Listen to the Sound of the Day Yesterday

Listen to the Sound of the Day Yesterday, Today & Tomorrow By Naveed Ahmed Khawaja Date: 19 th November 2009 A Company with a Heart and Soul

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The History of EBM • English Biscuit Manufacturers (Pvt) Ltd was established as a joint venture company in 1965 with the name of PEEK FREANS PAKISTAN LIMITED • In 1966 the UK sponsor company was renamed as Associated Biscuits International Limited (ABIL), while the venture was renamed to English Biscuit Manufacturers (Pvt) Ltd, which stands to date • EBM started manufacturing and marketing of world famous Peek Freans range in 1967 in order to provide Pakistani consumers with good quality, nutritious and hygienically packed biscuits A Company with a Heart and Soul

The Industry Issues • The Early Years - 70’s – Economic Challenges • Rupee de-valuation, Labor Unions unrest, Surging imported RM prices, Market too small (branded biscuits) • EBM making losses everyday – Tethering on the brink of bankruptcy – Incurring losses of Rs 5000/- per day – Traditional & Old style Biscuit industry • • BP – Montgomery – Sunshine etc. Branded market small & stagnant No concept of “Strong Branding”, “Positioning” No Product innovation/ differentiation etc. A Company with a Heart and Soul

Key Challenges • Leadership Challenge – Shake & revive the industry – Bring Change through Competition – Achieve Growth in branded biscuit industry • Strategy & Branding – – – Create need & niche Biscuits considered as a Luxury food item & not a necessity Introduce Branding & Positioning Bring Product & Packaging innovation Grow Vol. share to survive Invest in Technology & R&D A Company with a Heart and Soul

The Strategy of 70’s • Taking Competitive Edge • • Biscuits marketed as “food in between meals” Biscuits marketed under PF & EB umbrellas Through strong & modern “Branding” The Pied Piper concept launched – The Sound of Yesterday, Today & Tomorrow • The Legend Leads • Gained Instant Popularity, Awareness, Relevance, Trial and Loyalty • A larger than life icon… • But the Total Market did not grow! • Competition did not compete A Company with a Heart and Soul

The Strategy of 70’s contd. . . • Grow the total Market – – – Created Competition from within Launched another brand range “Happy” Created competition in branded biscuit ind. Overall Market grew by +30% Market growth attracted a mushrooming of entrants • Union, Montgomery, AB Foods, etc A Company with a Heart and Soul

The Strategy of 80’s • The mid-Years - Era of Market Growth – Grew market leadership through launch of new innovative products • Introduced Premium products i. e. Farm House Cookies (87 -88) • Introduced the EB Royal Range (88 -89) • Entry of Danone through CBL i. e. LU brand • Competitive environment fuelled further market growth A Company with a Heart and Soul

The Strategy of 90’s • Intense competition & market growth – – EBM market share slipped Standing Still…. Was not an option A change was imminent With increasing input costs, increasing competition & market share slip strategic business decisions had to be taken – EBM adopted a “high volume, low margin strategy” A Company with a Heart and Soul

The Strategy of 90’s contd… • Price Increase Freeze in mid-90’s – Objective • Create barriers of entry for new entrants • Make biscuits more affordable for consumers to aid conversion from loose biscuits to packaged • Allow economies of scale & capacity utilizations – Outcome • Market grew volumetrically • Small players crashed out as their scale of operations could not sustain the price freeze • EBM focused on increasing internal efficiencies – New plant expansions – Balancing, Modernization & Replacement (BMR) A Company with a Heart and Soul

The Strategy of 2000 & Onwards • Current Times – Era of EBM Growth – – Continue Price Freeze till 2007 Continue High Volume, Low Margin Strategy Focus on Increasing Internal economies and efficiencies Cost reductions without impacting product quality • Self-power generation • Reduction of product wastages • Increase in plant efficiencies (new plants) • Focus on long-term contractual agreements for raw materials procurement • Alternate sourcing of packaging material (imported vs. local) • No compromise on the product quality via any cutting of corners – Ensuring that the consumer is not cheated – Trust and confidence is maintained A Company with a Heart and Soul

The Strategy of 2000 & Onwards contd… • Market Penetration Strategies – Product Launches & Re-launches – EBM’s true Marketing Success Stories • Sooper Re-launch - leading the turnaround of business & growth of overall biscuit market Sooper 1. avi Sooper 2. mpg – Capitalizing on Market Leadership Position • RIO Double Treat – product innovation (2 creams) • Marvell – Product Innovation in Shape • Party Re-launch – Seeking new consumers through new consumption occasions • Sandwiches Re-launch – Over 40 years old brand – Tapping up-country markets • Peanut Pik & Pista Re-launch A Company with a Heart and Soul

The Strategy of 2000 & Onwards contd… • Focus on increasing Distribution Penetration into Rural Markets – Rural Development Programs – Opening of New Towns & Direct Servicing • Focus on Demand Generation – Out-spending competition on media – Trial generation & repeat purchase • Consumer Promotions • Brand Activations – Heavy investment behind CSR initiatives to project positive brand & company image • Demand of Brands > Ability to Supply – 5 Focus Brand Strategy A Company with a Heart and Soul

How did we do that ? “Power of Vision”

Vision • To be recognized as a LEADING and PROGRESSIVELY FORWARD looking FOOD COMPANY, providing the best quality products to everyone in Pakistan • To be an INSTITUTION financially healthy, promoting universal human values and growing as a useful, purposeful corporate citizen A Company with a Heart and Soul

Corporate Objective • Transform EBM into a living institution with a body, mind & soul which is recognized as a good corporate citizen due to its core values as Open minded, transparent, & responsibly delivering consumer satisfaction with a sprit to excel. A Company with a Heart and Soul

Core Values • Follows the Highest Ethical Values & Professionalism • Believes Product Quality is next to religion • Pursues International Safe Food Standards & Hygiene to promote National Health since its very inception • Environmentally sensitive & responsible • Attains Technological Advancement in both human resources, plant & machinery A Company with a Heart and Soul

Our Philosophy • Food is “Rizk” • “Hygiene” a part of a bigger concept of Pakeezgi • What is the concept of PAKEEZGI for us at EBM? à Innate realization that the Food we offer, MUST be of the highest Quality à Hygiene at the work-place à In our THOUGHTS & ACTIONS à In having a SENSE of RESPONSIBILITY and the HEART to do what’s right A Company with a Heart and Soul

Sense of Responsibility Towards Consumers – Ensuring Quality & Affordability • No compromise on product quality • Focus on improving internal efficiencies & economies of scale – Offering the best Quality & Taste • Adherence to International Quality Standards • First Biscuit company in Pakistan to attain HACCP & ISO 90012000 Certifications • State of the art manufacturing processes with investment of over Rs 2 billion A Company with a Heart and Soul

Sense of Responsibility Towards the Nation – Company contributes over Rs 850 million to the National Exchequer in the form of Taxes & Duties • Clubbed in the elite group of highest tax-payers – Provides Employment (direct & indirect) to over 2000 ppl approx – Company ethos of a Caring Corporate Citizen • As a Responsibility • As an Obligation of Good Governance A Company with a Heart and Soul

Sense of Responsibility Towards the Nation We make the world around us better. A Company with a Heart and Soul

Sense of Responsibility Towards the Nation – Sensitivity to the Environment • Proactive Environmental practices • Water Treatment Plant • Separate Area for Solid Waste Management • ISO 14001 Certification • Only Biscuit company to have received the Environment Excellence Award for 5 consecutive years A Company with a Heart and Soul

Caring Corporate Citizen • Primary focus of Corporate Social Responsibility (CSR) initiatives on 3 key areas: • Health • Education • Sports HEALTH EBM EDUCATION A Company with a Heart and Soul SPORTS

Sense of Responsibility Towards the Nation A Company with a Heart and Soul

Where are We? “LAST SEVEN YEAR HIGHLIGHTS” 01 -02 TO 08 -09

Sales Volume – Master Cartons +17% -2% 31% 48% 81% 11%

A Company with a Heart and Soul

A Company with a Heart and Soul

A Company with a Heart and Soul

A Company with a Heart and Soul

A Company with a Heart and Soul

5 A Company with a Heart and Soul

A Company with a Heart and Soul

A Company with a Heart and Soul

Recognized as A Company with a Heart and Soul

A Company with a Heart and Soul

The Mantra • Leadership – – • Power of Vision (No Dreams – No Gains) Magic of a Rallying Call Directing Peoples Power, Energy, Exuberance & Passion Make the Change happen Branding – Learn to reject, Research & Explore, Spend time • Technology – Invest ahead of time, Be the 1 st to introduce, Take risk • Customer Care – Suit your business to customers needs, otherwise – Customers will suit themselves • Work Environment – Open, Challenging, Competing, Empowering, Team working & Fun working The Harder You Work…The Luckier You Get!!

The Future • God has been kind to us • Our Consumers have been kind to us • We have lived up to their trust and confidence in our company and brands through our Marketing initiatives • Aggressive marketing plans for the future • We have glorious past…an enviable present and Godwilling, a prosperous future ahead of us where the Sound of Peek Freans will continue to keep resounding in your hearts A Company with a Heart and Soul

THANK YOU A Company with a Heart and Soul