CHARTERED INSTITUTE OF PERSONNEL

MANAGEMENT SRI LANKA (INC.)

DIPLOMA IN HUMAN RESOURCE MANAGEMENT

MINI BUSINESS DEVELOPING PLAN

 AN EXECUTIVE SUMMARY

The study is on Carlsberg Sri Lanka's business strategy.

Carlsberg Sri Lanka is a well-known beer manufacturer in
Sri Lanka. However, in recent years, brands like Tiger and
Guinness Anchor have posed a serious threat. So the
company's management concentrated on business growth
plan to stay competitive. Two elements have been
prioritized: product diversity and company growth. To evaluate the viability of the new business
strategy, extensive study has been performed.
According to the study, Carlsberg Sri Lanka must create goods suitable with all meals. For
example, the business should provide beer that goes well with the vegetables. Moreover, the
business must adapt its price plan to the people's economic situation. For business growth, the
firm must also enhance its business procedures. Moreover, the business must use various cost-
cutting strategies to reduce cost of products sold and increase operating profitability. The business
must also improve its risk management system to mitigate potential risks. This report contains
comprehensive marketing strategy for the business to grow its operations in rural and semi-urban
Sri Lanka. However, to grow into a new market, Carlsberg must first evaluate the consumer
preferences.

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 TABLE OF CONTENTS

1. Customers of the business 4

2. The target audience of the business 4
3. Opportunities 4
4. Competitors & competition 5
5. Financial plan 5
6. Marketing plan 6
7. Operational plan 8
8. People 10
9. Simplicity in planning 10
References 11

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 CUSTOMERS OF THE BUSINESS

According to 2021 estimates, Sri Lanka's annual beer market was 51 million liters with
an average of 2.7 liters per person. The increase to 2.45 litres per year from 50 million litres in
2019. Hard liquor's market share is decreasing, while the beer industry is increasing in
comparison. The beer market in comparison to the hard liquor market increased by 23% in
volume in 2021 whereas it only grew by 10% over the previous year.

THE TARGET AUDIENCE OF THE BUSINESS

Carlsberg Sri Lanka plans to sell beer in Sri Lanka's big cities, including Colombo and
Kandy. Though the company's marketing plans may not be seen as niche marketing, the price of
the company's goods will be increased in order to benefit the brand image. By working with
rugby, the business is better able to reach younger audiences and has gotten its brand in front of
a lot more people. Carlsberg Sri Lanka set up social networking platforms to maximize their
audience. It enabled many individuals to become aware of the company's goods.

OPPORTUNITIES

It is critical for the market researchers to clarify market boundaries to assist with the
formulation of company strategy. It's predicted that the overall volume of beer would rise by 4
percent in the future years, which is better than the prior year's increase (3 percent ). The big
boost in beer sales will come courtesy of the country's sizable middle-class populace. Conversely,
brand loyalty of customers may also be traced to big names like Tiger and Anchor who
outperform their competitors. Many people in Sri Lanka associate these firms with drinking,
because their products are popular among adults in the nation who may legally drink as defined
by local laws. Carlsberg Sri Lanka will be able to take advantage of the improved loyalty of
customers in the years to come to enhance their commercial success.

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 COMPETITORS & COMPETITION

Carlsberg Sri Lanka's management will create a new strategy to help them keep ahead of
their competitors. To do this, the firm will concentrate on expanding the selection of products.
The business will also reduce prices a little so that they're more competitive with the other firms.
Customers in this market category are very price sensitive, therefore the brand will be able to
attract more people with these lower prices. And the business plans to focus on bettering the
product's quality.

FINANCIAL PLAN
3-Year Forecast Income Statement

The above table shows, Carlsberg Sri Lanka's projected income statement. The projected
income statement is based on previous data. However, a positive growth factor was anticipated
for the projected income statement. We may expect the amount of money available to increase
by two percent and one percent next year. When doing market research, the client's customers
were considered. However, when profits grow, prices will also rise, hurting the overall gross
profit margin. The company's sales and administrative costs will rise with the market rate.
However, the company's financial managers will retain a portion of the profits to pay taxes.
However, the company's net income is projected to increase by 16% in 2020. However, owing
to economic factors, the company's net margin may fall by 17% in 2021. The company's EPS
is expected to remain stable over the next three years.

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 MARKETING PLAN

Segmentation and Positioning

Segmentation
Due to the saturated market in metropolitan Sri Lanka, Carlsberg Sri Lanka will
concentrate on the semi-urban area. Multinational beer firms may access Sri Lanka's rural
markets owing to their potential. Also, owing to the saturation of major markets like North
America and Europe, diversification of operations in Sri Lanka is warranted. Although the
brand is premium in Sri Lanka, it must primarily target the middle-income segment.

Geographical
According to market data, Sri Lankans living in cities drink the most alcoholic
beverages. However, the company's management will actively seek out semi-urban and rural
areas of Sri Lanka, since its primary rivals target the southern market. In this instance,
Carlsberg Sri Lanka has modified tactics to focus on the underserved Sri Lankan market.

Psychographic
A significant number of Sri Lankans have rapidly developed distinct cultures, lifestyles,
and personalities. A company like Carlsberg with worldwide recognition would be very pleased
with it.

Positioning
Carlsberg Sri Lanka will promote itself as the top beer brand in rural Sri Lanka as part of
its commercial growth plan. Carlsberg Sri Lanka is the most costly brand in Asia Pacific brewers,
compared to Anchor, Lion and Tiger beer. The brand will become a premium brand due to its
exceptional quality. The firm will also offer strong beer goods in Sri Lanka. Carlsberg Sri Lanka's
long-term business strategy is to develop new beer categories and pricing points.

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Marketing Mix

Product
Carlsberg's most popular product in rural and semi-urban Sri
Lanka is Carlsberg beer. It is the first in the area. Also, the company's
main product Carlsberg Pilsner will be crucial. It is classified as light
beer with an alcohol level of 3.8-4.6 percent. The firm will also
launch Tuborg. This product's USP is its revolutionary pull-off top
that eliminates the need for a bottle opener. Tuborg has a 4.6%
alcohol level. So it's a premium mild beer niche. The firm will launch
Okocim Palone, a 5.6 percent alcohol strong beer. It will be launched to target the conventional
beer customer segment.

Place
Carlsberg Sri Lanka will concentrate on rural and semi-urban distribution of its flagship
brand Carlsberg beer. While most of its competitors have targeted the country's western area,
Carlsberg Sri Lanka will target the country's other regions. Carlsberg Sri Lanka's management
will focus on expanding the company in the north and west of the nation. The firm will target
the country's top 20 metro areas.

Price
The Carlsberg Sri Lanka product will be somewhat more expensive than the current local
brands.The management of Carlsberg Sri Lanka will use the high pricing to preserve the
company's worldwide brand image.

Promotion
As Carlsberg enters a new market with many rivals, its advertising approach will need
special attention. Advertising and public relations is important, but it alone is not enough to
enter a new market. To be able to utilize social media marketing, the company must be in this
kind of scenario. With the rise of social media and online media, many believe that social media
marketing may help businesses appeal to customers. Aside from traditional advertising
methods, the business may concentrate on building client connection. During the holiday
season, the business may provide discounted or complimentary beer to consumers.

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 OPERATIONAL PLAN

Organizational Structure

Marketing department
First, Carlsberg Sri Lanka will concentrate on marketing to expand its company in semi-
urban and rural Sri Lanka. In this scenario, the business will hire a promotion head. It will
oversee all promotional efforts in the new market. The promotional head will also devise market
penetration tactics. Teece, Pisano, and Shuen (2009) state that in order to enter a new market,
business managers must raise product awareness among target consumers. The firm will also
hire four sales managers to oversee sales operations throughout the nation.

Operational department
Carlsberg Sri Lanka must improve operational operations to improve company
performance in semi-urban and rural Sri Lanka. The operational managers will concentrate on
lowering production costs. The newest technology are required to achieve cost efficiency. As a
result, the company will hire managers with technological skills. Moreover, the company's
operational managers will adopt methods like just-in-time to maximize operational efficiency.

Finance department
Finance managers will be hired to improve the company's financial performance in the
intended new market. The financial manager will keep track of all company transactions. The
financial manager will also monitor the company's liquidity and evaluate risk. To expand the
company, the finance manager will seek money from several sources.

Human Capital Plan

Formalizing human capital planning is an essential part of company growth strategy. In

this context, argues that human capital quality trumps worker number. Carlsberg Sri Lanka will
need to grow its operations in semi-urban and rural Sri Lanka. However, the company's human
resource managers must devise particular methods for attracting new employees.
Firstly, human resource managers will choose to hire domestically. Managers must
evaluate the cost of recruiting in this scenario. Human capital planning, on the other hand,
includes managers' strategies for recruiting new employees. Carlsberg Sri Lanka will place ads

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in the press to hire employees. Alternatively, the firm will hire employees via campus
internships at reputable Sri Lankan business schools. The company's human resource managers
will follow a transparent recruiting procedure. During the hiring process, all candidates will be
treated equally. Recruiting experienced individuals will help reduce training costs. Recruiting
from the home market allows business managers to spend less time and money educating
individuals about the targeted market's culture.

Business Process/ Value Chain

During business development planning, Carlsberg Sri Lanka management will

concentrate on improving the related business process. Company's bottom line performance is
mostly determined by its business process. The business will focus on primary and secondary
operations using the value chain concept. For example, the supply chain and distribution system
will be emphasized. Carlsberg Sri Lanka's management will focus on eliminating middlemen to
improve value chain efficiency. The management will increase the number of stores to increase
product availability. The business will also expand its supplier networks to improve the operating
system's efficiency. The company's operational managers will devise various cost-cutting
strategies to maximize operational profitability. To decrease storage costs, the company's
management will lower inventory levels. The company's management will focus on the
localization concept to effectively grow operations in the new market. But the firm's fundamental
business strategy will stay unchanged. The firm's goods will be tailored to appeal to local
consumers.

Localization approach may be beneficial for entering new markets. Moreover, while
developing goods, Carlsberg Sri Lanka management would consider the dietary patterns of rural
and semi-urban consumers. Moreover, the business would adjust product prices to the market's
economic situation. The company's management will use a just-in-time strategy to preserve
operational efficiency. The emphasis will be on improving consumer access to goods. Managers
will also concentrate on appealing promotional tactics to stay competitive in the industry. Apart
from broadcast and print media, Carlsberg Sri Lanka management will depend on word of mouth.
The business will aim to increase client happiness to increase word of mouth. In other words, the
business builds client loyalty.

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 PEOPLE

The youth population in Sri Lanka has seen tremendous growth in recent years. Semi-
urban and rural Sri Lanka is filled with youthful people. The firm will attempt to get the young
generation's attention by actively sponsoring rugby events. In this respect, the fact that the middle-
income group of Sri Lankans, in both rural and semi-urban areas, have seen an increase in
disposable income may be regarded a good factor for Carlsberg Sri Lanka's company.

SIMPLICITY IN PLANNING

Managers of a firm must define risk mitigation measures in order to successfully execute
business growth plans. Contingency planning helps managers anticipate business problems. Thus,
contingency planning saves the business from significant financial losses. Management of
Carlsberg Sri Lanka must create a rigorous risk mitigation system that comprises three stages:
identification, evaluation, and mitigation.
In the first step, managers will identify potential threats to the company's success. In this
instance, one of the most important risks is market risk. The poor economic situation of Sri
Lanka's rural and semi-urban markets may adversely impact Carlsberg Sri Lanka's bottom line.
In the second step, the company's management will assess each risk element. Carlsberg Sri
Lanka's management must assess each risk factor's frequency and likely effect. The management
will determine the next steps in risk mitigation measures based on this evaluation.
The business may use various hedging methods to minimize market risks. Managers may
use diversity to avoid market risk factors. To prevent quality problems, the company's
management must maintain a rigorous quality control system. Managers will also concentrate on
the change management strategy to prevent any organizational turmoil during transition periods.
The following are possible risk considerations for the proposed business:

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