Evaluation of Entry into Ice cream Business - BRAC University ...

“Evaluation of Entry into Ice 

cream Business for Unilever 

Bangladesh Limited” 

Submitted to 

Sharmin Shabnam Rahman 

Lecturer 

BRAC Business School 

BRAC University 

Submitted by 

Md. Robin Miah 

Id# 06204032 


Date: 02-09-2010

September 2, 2010 

SHARMIN SHABNAM RAHMAN 

Lecture 

BRAC Business School 


Subject: Submission of Internship Report 

Dear Madam, 

This is to inform you that I am submitting the internship project report titled “Evaluation of 

Entry into Ice cream Business for Unilever Bangladesh Limited” upon completion of my 

formal internship attachment period from May 06, 2010 to July 06, 2010 with Unilever 

Bangladesh Limited. 

I would like to thank you and show my gratitude for your support and guidance that you 

provided me during the preparation of this report. Without your help it would have been 

impossible for me to prepare this report. I would like also show my gratitude to my Company 

supervisor MD. Risalat Siddique, Brand Manager, UBL for his support during my internship 

period. 

I have tried to discuss all the relevant points of a feasibility study while keeping consistency with 

Unilever Bangladesh Limited’s information confidentiality policy. 

I would be glad to clarify any discrepancy that may arise or any clarification that you may 

require regarding my project and report. 

Sincerely, 

________________________ 

MD. ROBIN MIAH 

ID#06204032 

BRAC University

ACKNOWLEDGEMENT 

I would like to show my sincere gratitude to Sharmin Shabnam Rahman, lecturer, BRAC University, 

and my Academic Internship Supervisor; for her constant supervision and guidance have been of 

extreme help to me. I am also thankful for all the times I consulted her and she answered with the 

utmost patience and perseverance. 

I am thankful to Mr. Tanzeen Ferdous, Senior Brand Manager, Brands & Development, Unilever 

Bangladesh Limited, for entrusting me with such an important project and allowing me scope to work 

independently, providing all required supports. 

I am also grateful to Mr. Muhammad Risalat Siddique, Brand Manager, Unilever Bangladesh 

Limited and my Company Internship Supervisor, for his relentless support during each stage of 

research and work. He supervised and corrected me during the entire research process. 

Last but no the least, I would like to thank Mr. Hamdan Kabeer, Brand Manager for Lipton, Unilever 

Bangladesh Limited for helping me in developing the construct of this report and providing me detail 

regarding Operating Methods for Foods of Unilever PLC. 

Evaluation of Entry into Ice cream Business for Bangladesh Limited 

I

Executive Summary 

Unilever Bangladesh Limited (UBL) is a household name virtually for every Bangladeshi national. 

Being a multi-national, no other company has achieved this level of success. It is regarded as one of 

the most reputed multi-cultural companies of the world. With its history of over 70 years globally, UBL, 

an operating and Brand building company of Unilever Group has predominantly served the 

Bangladeshi market with mainly Home and Personal Care (HPC) FMCG products for last 47 years 

with limited presence in the food business with Lipton tea. With dominant brands in HPC like Lux, 

Lifebuoy, Wheel and Pond’s, growing brands like Sunsilk, Clear and rising stars like Rexona and 

Dove’, the company now wants to check its possibilities in the foods category which globally is the 

largest business of Unilever (54% of total portfolio). With this intention in mind, the authorities of UBL 

in Brands & Development Department assigned the project “Evaluation of Entry into Ice cream 

Business for Unilever Bangladesh Limited”. This research was designated to be mainly qualitative 

in nature and to build on earlier researches done by UBL. 

To assess the feasibility of entering into ice cream business, I combined primary sources like 

consumer and trade visits, and secondary sources like earlier research reports to understand market 

construct, market characteristics, and target consumer groups of the ice cream industry. Based on the 

collected data, and then assessed the entry prospect for UBL in this industry. 

Ice cream industry of Bangladesh is estimated to have a size of BDT 220 Crore where BDT 131 Crore 

belongs to branded segment (BDT 121 Crore Common Format Ice cream that is distributed through 

retail and BDT 9.8 Crore in the boutique segment) and BDT 79 Crore is in the unbranded low qualitylow 

price segment. The industry is currently growing at a rate of 19%. The research excluded 

unbranded segment from discussion as global quality mandate of Unilever prohibits UBL from 

competing in that market. 

Branded common format is dominated by Igloo with more than 51% share with followers like Kwality 

and Polar where Milk Vita and Savoy are minnows. Boutique segment is competed by Club Gelato 

(20% share), MövenPick, Andrsen’s (3 outlets) and Gelateria Igloo (3 outlets). These three have 

around 17% share. 

The market is characterised by low competitive rivalry where Dhaka still contributes to more than 61% 

of total country’s sales. This is due to issues regarding electricity and requirement of cold distribution 

chain by the industry. There are still huge untapped areas of the country. However, the industry is 

extremely capital intensive and there are lots of entry barriers. Only manufacturers with large capital 

can invest and thus there has been no big player in the common format segment since Kwlaity (1999). 

Products or of quite high quality in the Bangladeshi market but price is still out of reach of rural and 

lower SEC people who belong to low disposable monthly income group. Distribution is mainly done 

through refrigerated trucks alongside use of carts in the country. Boutique format players serve at 

their premises, ice cream and other dessert items to offset seasonality of ice cream sales. Promotion 

in the common format is mainly in newspapers and billboards along with trade based consumer 

promotions and trader schemes. 

Consumers of ice cream are mainly Urban kids in the age group of 5-14 who mainly consume normal 

sticks, cups, cones innovative fillers and water ice creams; there is urban youth in the age group of 

15-24 who consume premium and extrusion sticks and cones and urban mothers in the age group of 

25-35 who are the decision makers for kids and family ice cream purchases. The consumers can be 


II

segmented based on their desired satisfactions from ice cream occasion, portrayed personality traits 

of ice cream bands and the occasions when they consume ice cream. Analysis shows there is scope 

for market development and penetration in the country. There is also scope for ice creams that are 

health conscious and nutritional in the industry. 

Looking at the scenario of the Bangladeshi market, UBL is suggested to enter the industry in a grand 

way with tentative initial investment of BDT 45 Crore in manufacturing facility, cold distribution channel 

development and placing branded freezers at retail outlets. Expected brand is Wall’s, the regional ice 

cream brand of Unilever. Company is also suggested to enter in the boutique segment with 

Ben&Jerry’s the premium boutique brand of Unilever. Products should be differentiated and nutritional 

with the price range at par or higher than common format players and lower than the boutique format. 

Extensive promotion would be required and thus presence in television as ice cream is a brand that 

requires continuous innovation and hype around the brand. 

Expected outcome of the entry is to have sales of BDT 11 Crore with a market share of 10% in the 

first year. However, for the first three years company would have negative net profit and is expected 

to make a net profit of BDT 2.5 Crore with a gross slaes of BDT 38 Crore in the fifth year of business. 

Thus, Unilever can benefit from entering in this industry if they enter in a grand way. Obviously 

company has to balance the investment issues for the industry and also acquire necessary resource 

for ice cream as traditionally UBL is an HPC company. If they can address these issues tactfully they 

can do well leveraging their existing brand image. 


III

Table of Contents 

Topic Detail Pg. No 

1.0 Introduction 

1.1 Background of the Report 1 

1.2 Objectives 1 

1.3 Scope 2 

1.4 Methodology 2 

1.4.1 Primary Research 2 

1.4.2 Secondary Research 3 

1.5 Limitation 4 

2.0 Background of the Organization 5 

2.1 Global Unilever Group 5 

2.1.1 Home and Personal Care Divisions 5 

2.1.2 Foods Division 6 

2.2 History of Unilever 6 

2.2.1 Soap and Margarine Origins 6 

2.2.2 Surviving the Great Depression 7 

2.2.3 Post-war Era: Adapting to New Markets and Technology 7 

2.2.4 Restructuring and Major Acquisitions 7 

2.2.5 Twenty First Century Unilever 7 

2.2.6 Unilever of Today 8 

2.3 Unilever Bangladesh Limited (UBL) 8 

2.3.1 Manufacturing Facilities 9 

2.3.2 Employees 9 

2.3.3 Product Categories and Brands 9 

2.3.4 Brand Launches by Year 10 

2.3.5 Corporate Mission 11 

2.3.6 Corporate Social Responsibility 11 

2.3.7 Corporate Governance 11 

2.3.8 Organizational Structure 12 

2.3.9 Brands and Development Department 12 

3.0 Global Ice cream Industry 15 

3.1 Overview 15 

3.2 Unilever Ice cream Business 15 

3.3 Regional Ice cream Business and Unilever 16 

3.3.1 Ice cream Consumption 16 

3.3.2 India Ice cream Business and Unilever 16 

4.0 Bangladesh Ice cream Industry 17 

4.1 Industry Construct 17 

4.1.1 Branded Market 17 

4.1.2 Unbranded Market 18 

4.2 Historical Progress of the Industry 18 

5.0 Market & Competition Analysis 20 

5.1 Market Description 20 

5.1.1 Market Characteristics of the Common Format Segment 20 

A. Market size 20 

B. Competitive rivalry in the Market 20 

C. Market Sales and Growth Rate 22 

D. Market Share and Size of the rivals 22 

E. Geographic Sales Orientation 23 

F. Seasonality of Sales 23 

G. Distribution/ Servicing System 24 

H. Technology and Innovation 26 


IV

I. Production Capacity 26 

J. Products and Pricing 27 

K. Firms as Price Setters 28 

L. Promotion 28 

M. Players in the Common Format Segment 30 

5.1.2 Market Characteristics of the Boutique Segment 35 

A. Detail of Operation 36 

B. Players in the Boutique Segment 37 

5.2 Price Comparison of Common and Boutique Segments 41 

6.0 Consumer Analysis 42 

6.1 Target Group of Ice cream 42 

6.1.1 Geographic Group 42 

6.1.2 Target Age Group 42 

6.1.3 Target SEC and DMFI Group 43 

6.2 Ice cream in Consumer Lifestyle 43 

6.3 Highlights of Purchase Habit of Ice cream 44 

6.3.1 Common Habits across Target Groups 44 

6.3.2 Habits of Kids 45 

6.3.3 Habits of Youth 45 

6.3.4 Habits of Mothers 45 

6.4 Barriers to Ice cream Consumption 45 

6.4.1 Emotional Barriers 45 

6.4.2 Functional Barriers 45 

6.5 Research Findings 46 

6.5.1 Relevant Occasions in Daily Lives of Consumers 46 

6.5.2 Frequency of Ice cream Consumption 47 

6.5.3 Market Character: Relevant Occasions vs. Frequency of Consumption 48 

6.5.4 Consumer Satisfaction from Ice cream Occasions 50 

7.0 Industry Attractiveness and Entry Prospects 52 

7.1 Driving Forces of Growth 52 

7.1.2 Trade and Infrastructural Level 52 

7.1.3 Consumer Level 52 

7.2 Prospects of Entry 53 

8.0 Entry Strategy for Unilever 54 

8.1 Suggested Entry Areas for UBL 54 

8.2 Products 54 

8.3 Placement 55 

8.4 Price 55 

8.5 Promotion 55 

8.6 Scope of Opportunity 55 

8.6.1 Geographic Contribution 56 

8.6.2 UBL objectives 56 

8.7 Critical Success Factors 56 

9.0 Business Projection 57 

9.1 Basic Assumptions 57 

10.0 Conclusion 58 

References 

List of Tables 


V

Detail 

Page 

No. 

Table 1: Detail of Trade Visit 2 

Table 2: Detail of Consumer Research 3 

Table 3: Third-Party Factories of UBL 9 

Table 4: UBL Categories and Brands 10 

Table 5: History of Brand Launch 10 

Table 6: Unilever’s Global Ice cream Business 15 

Table 7: Per Capita Ice cream Consumption of Countries 16 

Table 8: Glimpse of India Ice cream Business 16 

Table 9: Market Sales and Growth Rate of Branded Common Format Market 22 

Table 10: Volume Based Market Size 22 

Table 11: Market Share of Competitors 23 

Table 12: Seasonality of Ice cream Sales 24 

Table 13: Distribution Method of Market Players 24 

Table 14: Production Capacity of Current Market Players 26 

Table 15: Ice cream Serve types 27 

Table 16: Rank of SKUs 27 

Table 17: Rank of Flavours 27 

Table 18: Volume Share of Different Serve Types 27 

Table 19: Products of Igloo 30 

Table 20: Igloo Facilities and Logistics 32 

Table 21: Strengths and Weaknesses of Competition 35 

Table 22: Players and Shares in Boutique Segment 36 

Table 23: Detail of Club Gelato 38 

Table 24: Detail of MövenPick of Switzerland 39 

Table 25: Detail of Andersen’s of Denmark 40 

Table 26: Detail of Gelateria Igloo 41 

Table 27: Comparative Price Analysis 41 

Table 28: Relevant Occasions in Consumers’ Lives 46 

Table 29: % of Variance Explained by Consumer Clusters 55 

Table 30: Requirements & Product Attributes Desired by Consumer Clusters 50 

Table 31: Value and Volume Based Scope of Opportunity for UBL 55 

Table 32: Assumptions for Business Projection 58 


VI

List of Figures 

Detail 

Page 

No. 

Figure 1: Unilever’s Business Areas and Sales Contribution 5 

Figure 2: Unilever’s Governing Structure 12 

Figure 3: Departments and Leadership Team of UBL 12 

Figure 4: Organogram for Brands and Development Department 14 

Figure 5: Unilever Ice cream Portfolio 15 

Figure 6: Market Construct of Bangladesh Ice cream Industry 17 

Figure 7: Geographic Sales Orientation 23 

Figure 8: Serve Types and Pricing 28 

Figure 9: Igloo Supply Chain 31 

Figure 10: Distribution Process of Igloo 31 

Figure 11: Target Group wise Consumption Pattern 42 

Figure 12: Ice cream in Consumer Life style 43 

Figure 13: Frequency of Occurrence of Occasions 47 

Figure 14: Frequency of Ice cream Consumption 48 

Figure 15: Relevance of Occasion-Frequency of Consumption Mapping 49 

Figure 16: Required Market Strategy for Bangladesh 49 


VII


VIII

1.0 INTRODUCTION 

This section presents the background of the report, “Evaluation of Entry into Ice cream Business 

for Unilever Bangladesh Limited” and outlines its objectives, scope, methodology of project 

completion and report preparation used in its formation, and limitations of the report. 

1.1 Background of the Report 

This project was assigned as part of the Internship Program of Institute of BRAC University upon 

completion of four year BBA graduation program. In accordance with the specifications of the 

Program, the author has completed the 12-week period of the internship at an organization, Unilever 

Bangladesh Limited (UBL). 

The project was completed and report was prepared under kind supervision of Academic supervisor, 

Sharmin Shabnam Rahman, Lecturer, BRAC University and Official supervisor, Muhammad Risalat 

Siddique, Brand Manager, UBL. The project, on which this report is based, was assigned as a job 

responsibility of me my self. 

1.2 Objectives 

Broad Objective: 

Main objective of the project was to evaluate feasibility of entering into ice cream business for UBL. 

To achieve this broad objective, some specific objectives were accomplished. These are outlined 

below. 

Specific Objective: 

� Identify current global ice cream business situation and view of Unilever towards Asian region. 

� Identify ice cream industry construct of Bangladesh and its parameters and characteristics. 

� Analyze sales, financing, marketing, and supply chain issues of branded ice cream segment. 

� Analyze current market players of the branded segment. 

� Analyze consumers of Ice cream in detail. 

� Assess industry attractiveness and entry prospects for UBL. 

� Suggest entry strategy for UBL. 

� Estimate tentative five year business projection for UBL in ice cream business. 

Evaluation of Entry into Ice cream Business for Bangladesh Limited 1

1.3 Scope 

Scope of research for the project has been limited to Dhaka and outskirts of Dhaka only. As of 

current market situation, ice cream is primarily an urban product (due to electricity issues of the 

country) and Dhaka contributes more than 50% of the market and all the major marketing activities 

are concentrated in Dhaka and thus this scope does not limit overall understanding of the market. 

The report puts emphasis on branded ice cream segment and takes a cursory glimpse of the 

unorganized unbranded segment. While carrying out the competitor analysis, all the existent branded 

segment players and only the major players in the premium boutique segment have been analyzed. 

Special emphasis has been placed on market leaders and their marketing strategies while formulating 

the entry strategy for UBL. 

1.4 Methodology 

Both primary and secondary research sources were used to complete the analysis. Primary research 

was mainly qualitative and was used to understand the ice cream industry first-hand and validate the 

information collected from secondary sources. Details of both methodologies are provided below. 

1.4.1 Primary Research: 

Trade Visit: 

� During market visit, a total of 60 shops were visited with formal questionnaires in different areas of 

Dhaka city. Areas were selected based on SEC orientation of different areas. The areas were: 

Zone 

Gulshan, Dhanmondi, 

Uttara 

Kamalapur, Mirpur, 

Mohammadpur, 

Lalmatia 

Malibagh, Rampura, 

Khilgaon, Shantinagar 

Azimpur, Lalbag, New 

Market, Dhaka 

University, Sadarghat 

Table 1: Detail of Trade Visit 

Major SEC 

Orientation 

SEC A++ 

SEC A 

SEC A & B 

SEC B & C 

Channels Visited (All Zones) 

1. Urban General Stores (UGS) 

2. Urban Neighbourhood Grocer 

(UNG) 

3. Premium General Store (PGS)/ 

SMMT 

4. Modern Trade (MT) 

5. Confectionary/ Bakery 

6. Fast Food shops 

� 10 (6 Igloo and 4 Kwality) cart sellers were interviewed to understand cart distribution and selling 

method. 

� 4 highest performing boutique players (Club Gelato, MövenPick of Switzerland, Andersen’s of 

Denmark and Gelateria Igloo) were formally interviewed to understand the boutique segment. 


Consumer Visit: 

To understand consumer perception about ice cream and current industry, focus target groups of ice 

cream were identified and group discussions were conducted with them. The groups were: 

� Urban kids in the age group of 5-14: 

� Informal discussions with 10 kids regarding their perception of ice cream and how their 

parents influence their ice cream consumption. 

� Urban youth in the age group of 15-24 

� Two group discussions were conducted students of IBA and NSU, each consisting of 10 

members. 

� Urban mothers in the age group of 25-35 

� Two group discussions were conducted with mothers at Green Herald Int’l School and Rifles 

Public School. 

1.4.2 Secondary Research: 

Secondary research sources provided useful insight into background and upcoming issues of global 

and Bangladesh ice cream industry. These were used as information source and then cross validated 

against each other and using primary research. 

Internal sources: 

Unilever’s internal sources that contributed to the research were: 

� Unilever global web archive. 

� Unilever Ice cream Academy web site. 

� Unilever Pakistan Ltd, Consumer & Market Insight (CMI) Division. 

� Unilever Bangladesh Ltd archive. 

External sources: 

External sources that contributed were: 

� AC Nielsen, Bangladesh. 

� Market Research Information from India. 

� Market Intelligence from Bangladesh. 

� Company web sites of competitors. 

� Earlier reports on the Ice cream industry of Bangladesh. 

� The Internet. 

1.5 Limitation 

This study had few limitations that restricted the research analysis. They are outlined below. 

� By policy, UBL does not disclose any financial, research, production or sales data to any entity 

outside the company. Because of this policy, it has not been possible to include the data and 


other information used to estimate different financials and work out the entry strategy for UBL in 

this report. This is especially true in case of the business projection section, where information on 

the exact size of the target group, market share for the initial years, distributor and trade margins, 

supply chain costs, etc. have been omitted. Much of the data provided has been modified to 

maintain confidentiality. 

� First of all, convenience sampling was used for research and this warranted for some biasness in 

input from traders and consumers of qualitative study. 

� All the market competitors are private companies and thus amount of available public information 

is few. Also, no research or advertising agency formally tracks the industry. In many cases recent 

concrete data was not available and estimations had to be made. 

� Research was conducted only in Dhaka even though ice cream consumption habits and 

distribution issues (e.g. electricity) in other areas of the country can vary in future with proper 

expansion of the ice cream industry beyond capital and metro cities. 


2.0 BACKGROUND OF THE ORGANIZATION 

2.1 Global Unilever Group 

Unilever is one of the world’s leading suppliers of fast-moving-consumer-goods (FMCG), with 400 

brands spanning 14 categories of Home, Personal Care and Foods products. In fact, 150 million times 

a day people use Unilever products at key moments of their day. Unilever employs more than 206,000 

people in 150 countries and had worldwide revenue of just over US$47 billion or BDT 3290 billion in 

2009. 

Unilever has two parent companies - Unilever NV and Unilever PLC. Unilever N.V is a public limited 

company registered in the Netherlands and Unilever PLC is a public limited company registered in 

England and Wales. The two parent companies, NV and PLC, together with their group companies, 

operate as a single economic entity (the Unilever Group, also referred to as Unilever) with the same 

board of directors. Unilever's corporate centres are in London and Rotterdam. 

Unilever’s brand portfolio includes worldwide favourites: Lipton, Knorr, Dove, Axe and Vaseline. Their 

portfolio is diverse in response to the varying needs of their customers across the globe. Unilever 

offers world-class brands, many of which are customized for local markets. Unilever invests €1 billion 

or BDT 94.4 billion every year in cutting edge research and development and has five laboratories 

around the world that explore new thinking and techniques to help develop their products. The 

following figure shows the portfolio of categories Unilever operates in: 

Figure 1: Unilever’s Business Areas and Sales Contribution 

The following are some recent highlights from Unilever’s three global divisions - Foods, Home Care 

and Personal Care: 

2.1.1 Home and Personal Care Divisions: 

� Lux became the first mass-marketed soap when it launched in 1924. Today it achieves annual 

global sales of over €1 billion 


� Unilever’s oral care brands Mentadent, Pepsodent and Signal have teamed up with the world's 

largest dental federation, the FDI, representing 750 000 dentists around the world 

� First launched in France in 1983,Unilever’s leading male grooming brand, Axe, now gives men 

the edge in the mating game in over 60 countries 

� Hindustan Lever has launched a Surf Excel Quick Wash, with a low foaming formulation, reducing 

the amount of water needed for rinsing by up to two buckets per wash 

� Recent breakthroughs at Rexona include Rexona Crystal, a deodorant that eliminates unsightly 

white deposits on dark garments. 

2.1.2 Foods Division: 

� Unilever is the world's leading ice cream producer, with brands such as Algida and Wall's in 

Europe, and Ben & Jerry's in the United States. 

� Unilever is the largest seller of packet tea in the world through the Lipton brand. 

� The acquisition of Bestfoods in 2000 brought Unilever leadership in the culinary category. Knorr is 

now their biggest brand, with €2.3 billion sales in over 100 countries and a product range covering 

soups, bouillons, sauces, noodles and complete meals. 

� Becel/Flora pro.activ products have been recognized as the most significant advancement in the 

dietary management of cholesterol in 40 years. 

2.2 History of Unilever 

2.2.1 Soap and Margarine Origins: 

The Anglo-Dutch Group, Unilever, was created in 1930 when the British soap-maker Lever Brothers 

merged with the Dutch margarine producer, Margarine Unie. At the time, an international merger was 

an unusual move. However, the owners of the two companies could see that bringing together 

complementary businesses with strong global networks would create new opportunities. The 

companies were competing for the same raw materials, both were involved in large-scale marketing of 

household products and both used similar distribution channels. 

Lever Brothers was founded in 1885 by William Hesketh Lever with his brother James. The company 

produced Sunlight, the world's first packaged, branded laundry soap. Sunlight was a revolutionary 

product that helped popularize cleanliness and hygiene in Victorian England. Its purpose was 'to 

make cleanliness commonplace; to lessen work for women; to foster health and contribute to personal 

attractiveness, that life may be more enjoyable and rewarding for the people who use our products.' 

In 1930, Lever chose Margarine Unie as a merger partner. Margarine Unie, a Dutch company had 

grown through mergers with other margarine companies in the 1920s. The logic for the Anglo-Dutch 

merger was clear: animal fats were the raw materials for both margarine and soap. 


2.2.2 Surviving the Great Depression: 

The Great Depression struck not long after the new company was formed. As prices and profits 

around the world threatened to collapse, Unilever had to act quickly to build up an efficient system of 

control. But it was not until the end of World War II that Unilever began to recognize the important 

relationship between marketing and research. In the meantime, Unilever expanded its U.S. operations 

through two important acquisitions: Thomas J. Lipton Company, manufacturer of tea and the 

Pepsodent brand of toothpaste. 

2.2.3 Post-war Era: Adapting to New Markets and Technology: 

Unilever's greatest achievements between 1945 and 1965 were its adaptation to new markets and 

technology. Unilever's strategy was to acquire companies in new areas, particularly food and 

chemical manufacturers. Among the post-war acquisitions were U.K. frozen foods maker Birds Eye 

(1957) and U.S. ice cream novelty maker Good Humour (1961). The advent of the European 

Economic Community, or Common Market, also created new opportunities for Unilever. 

2.2.4 Restructuring and Major Acquisitions 

In the 1980s Unilever undertook a massive restructuring. The company sold most of its service and 

ancillary businesses, such as transport, packaging, advertising, and other services that were readily 

available on the market, and went on a buying spree, snapping up some 80 companies between 1984 

and 1988. Specifically, Unilever's core businesses were detergents, foods, toiletries, and specialty 

chemicals. 

2.2.5 Twenty First Century Unilever: 

Unilever's fastest growing market in the early 1990s was in Asia. Asian sales of personal products, 

detergent, and packaged foods were growing more than twice as fast as sales in the United States 

and Europe. Unilever continued to make acquisitions in the mid-1990s, completing more than 100 

purchases between 1992 and 1996, more than half of which were in foods. In 1993 Unilever gained 

the number one position in the U.S. ice cream market through the completion of two acquisitions. One 

the largest acquisitions of this period was the 1996 takeover of Chicago-based Helene Curtis 

Industries Inc., manufacturer and marketer of personal care products, primarily shampoo and 

conditioners, hand and body lotions, and deodorants and antiperspirants. 

Unilever ended the 20th century with the launch of Path to Growth, a five-year strategic plan that 

included a focus on top brands within core market sectors and an emphasis on growth within 

developing countries. In the face of considerable competitive pressures in various markets around the 

world – particularly from Procter & Gamble, the company announced that it would eliminate about 

1,200 of its brands to focus on around 400 regionally or globally powerful brands. 


2.2.6 Unilever of Today: 

Unilever is truly a ‘multi-local’ multinational with operating companies and factories on every continent. 

They have a portfolio of brands that are popular across the globe - as well as regional products and 

local varieties of famous-name goods. This diversity comes from two of their key strengths: 

� Strong roots in local markets and first-hand knowledge of local cultures 

� World-class business expertise applied internationally to serve consumers everywhere 

Unilever recently completed the five-year Vitality company initiative in which it began to converge the 

marketing of disparate arms of their business, including personal care, dieting, and consumables into 

an umbrella function. More than ever, Unilever brands are helping people 'feel good, look good and 

get more out of life' – a sentiment close to William Lever's heart over a hundred years ago. 

2.3 Unilever Bangladesh Limited (UBL) 

Lever Brothers Bangladesh established its manufacturing facility in 1964 at Kalurghat in Chittagong. 

Productions started off with Lux and Lifebuoy soap. After meeting the local demand, the surplus 

production was shipped to Pakistan. It was after independence that Lever Brothers Bangladesh Ltd 

was constituted with Unilever owning 60.75% shares and the Government of Bangladesh owning the 

remaining 39.25% shares. In 2004, Lever Brothers was renamed Unilever Bangladesh Limited in 

order to align their corporate identity and logo with the global Unilever. 

By tapping into the vast know-how base of the parent company - Unilever, Lever Brothers was able to 

make their products available to the consumers at an affordable price. In the last decade, Unilever 

has consistently been achieving double-digit growth in Bangladesh, with an annual turnover reaching 

at BDT 1 billion in 2006. Unilever procures 40% of its inputs from local sources and spends about 

BDT 150 crores annually in Bangladesh for promotional activities, including advertisements, for its 

products. 

Its current offices are located in: 

Factory: Unilever Bangladesh Limited 

51 Kalurghat Heavy Industrial Area 

P. O. Box # 125 

Chittagong – 4000 

Bangladesh 

Corporate Office: Unilever Bangladesh Limited 

ZN Tower 

Plot No. 2, SW (1) 

Road No. 8 

Gulshan – 1 

Dhaka – 1212 

Bangladesh 


2.3.1 Manufacturing Facilities: 

The company has a Soap Manufacturing factory and a Personal Products Factory located in 

Chittagong. The factory has to adhere strictly to four important policies: 

� Quality Policy 

� Occupational Health and Safety Policy 

� Environmental Policy 

� Quality & Consumer Safety Policy 

� Total Productive Maintenance Policy 

Besides these, there is a tea packaging operation in Chittagong and four manufacturing units in 

Dhaka, which are owned and run by third parties exclusively dedicated to Unilever Bangladesh. 

The following are the details of these third party operations: 

ARC Surfactants 

91, Tongi Industrial Area, Gazipur 

Progati Soap Factory 

Tongi Industrial Area, Gazipur 

SMAH Limited 

96, Tongi Industrial Area, Gazipur 

Third-Party Factory Brand 

SMAH Limited 

115-116, BSIC Industrial Estate, Konabari, Gazipur 

2.3.2 Employees: 

Table 3: Third-Party Factories of UBL 

Wheel Washing Powder , 

Surf Excel 

Lifebuoy Soap – 70gm 

Wheel Washing Powder 

Pond’s Talcum Powder 

Unilever operations in Bangladesh provide employment to over 10,000 people directly and through its 

dedicated suppliers, distributors and service providers. Ninety-nine percent of UBL employees are 

locals. 

2.3.3 Product Categories and Brands: 

In Bangladesh, Unilever offers consumer brands which spans across three categories which are as 

follow: 

� Home care, which in turn is divided into: 

� Fabric cleaning 

� Household care 

� Personal care, which in turn is divided into: 

� Skin Cleansing 

� Skin Care 

� Oral Care 

� Hair Care 

� Foods 


There are currently 14 brands across the above-mentioned categories: 

Category Brands 

Skin Cleansing Lux, Lifebuoy and Dove 

Skin Care Fair and Lovely , Rexona and Ponds’ 

Oral Care Pepsodent and Close Up 

Hair Care Sunsilk, Dove and Clear 

Fabric Cleaning Wheel, Surf Excel 

Household Care Vim 

Foods Lipton Taaza 

Table 4: UBL Categories and Brands 

Leveraging their global network and combining it with local consumer insight, Unilever Bangladesh 

has introduced relevant innovative products throughout the years. This has led to the development of 

products in categories such as Detergent powders, Dish wash Bar, Face wash and Deodorants, thus 

enriching the lives of Bangladeshis. The following table illustrates the way UBL has continuously 

introduced new brands and even more so in the last decade. 

2.3.4 Brand Launches by Year: 

2.3.5 Corporate Mission: 

Year Brands 

1964 Lifebuoy 

1964 Lux 

1972 Wheel Laundry Soap 

1982 Sunsilk 

1987 Close Up 

1987 Vim 

1989 Clear 

1988 Fair & Lovely 

1990 Lipton Yellow Label 

1991 Ponds' 

1991 Pepsodent 

1992 Taaza 

1993 Surf Excel 

1997 Wheel Washing Powder 

2002 Clinic 

2002 Rexona 

2003 Vim Bar 

2003 Pepsodent Tooth Powder 

Table 5: History of Brand Launch 


Unilever states its mission as follows: 

“Our mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene and personal care 

with brands that help people look good, feel good and get more out of life.” 

Its goals are: 

� To manufacture high-standard products 

� Promoting products to the highest extent 

� Producing large volume to achieve production cost economies 

� Enabling quality products to be sold out at obtainable prices 

2.3.6 Corporate Social Responsibility: 

Unilever Bangladesh supports community development through various initiatives. 

� The Fair and Lovely Foundation undertakes various projects throughout the country to empower 

women with access to information and resources in the areas of Education, Career and 

Enterprise. Workshops for rural women teaching them business and vocational skills like pickle 

making , poultry farming, etc. have been held and Projects on IT education for women will also be 

implemented through this Foundation 

� Unilever Bangladesh has sponsored the modernization of existing surgical facilities and the 

setting up of a modern operation theatre and intensive care unit at the Maa Shishu O General 

hospital in Chittagong, which significantly enhanced access to modern health care for the 

underprivileged people of the city 

� Unilever is the main sponsor of the Lifebuoy Friendship Hospital bringing health care to 

thousands of underprivileged riverine population in the country 

� UBL also sponsors students from various education institutes in Chittagong as well as members 

of the British Council Library and provided scholarships to meritorious students. 

2.3.7 Corporate Governance: 

Unilever's highest executive body is called the Unilever Executive (UEX). It is led by the Group Chief 

Executive (GCE), Patrick Cescau. The UEX define the top level organisation structure and manage 

tradeoffs within the corporate portfolio. They are accountable for all aspects of company operations, 

managing business performance and overall profit responsibility for the Group. 

The Unilever Executive is also responsible for defining and shaping the culture, leadership capabilities 

and behaviour needed to deliver Unilever’s corporate strategy. They have responsibility for all internal 

communications and some aspects of external communications (customers, suppliers, professional 

bodies, media and investor relations). They are responsible for managing corporate risk and 

reputation. 


Figure 2: Unilever’s Governing Structure 

The Category Presidents for Foods and Home and Personal Care are responsible for Category 

strategies, brand development and innovation. The Regional Presidents are responsible for managing 

the business, deploying brands and innovations effectively and winning with customers. They are 

supported by the Finance and HR functions. 

2.3.8 Organizational Structure: 

Unilever Bangladesh is headed by a Chief Executive Officer, Mr. Rakesh Mohan, in Bangladesh. 

There are five departments headed by five individual directors. Presently the company has the 

following departments at its corporate headquarters: 

Brands & 

Development 

K.S.M. Minhaz 

Supply Chain 

Imran Momin 

CEO 

& Chairman 

Rakesh Mohan 

Finance IT 

& Legal 

Mahatabuddin 

Ahmed 

Customer 

Development 

Mizanur Rashid 

Figure 3: Departments and Leadership Team of UBL 

2.3.9 Brands and Development Department: 

This department has five parts working together. These are: 

� Brands 

� Development 

� Consumer and Market Insight (CMI) 

� Media 

� Activation 

Evaluation of Entry into Ice cream Business for Bangladesh Limited 12 

Human 

Resources 

Jerry Jose

This department is responsible for nurturing a brand towards market leadership and offering 

consumers with innovation and novelty in brands. With a deep consumer insight, the Brand Managers 

look after the brands on a daily basis: planning and organizing activities that boost their image and 

increase their exposure. The Brands Team has been expanded to Brands and Development, thus 

providing the opportunity of increased coordination between the Marketing and Development Team 

and to ensure a successful innovation process at Unilever. The Development team is responsible for 

developing cost-effective formulations and packaging for the products and developing and improving 

the processes involved in their manufacture. 

However, Bangladesh still remains a Brand-Building country while Development generally takes place 

at regional level. Brand Developing countries are responsible for the brand category strategy, 

identifying new consumer and technology opportunities, product formulation and packaging design 

and communication strategy. The critical role of Brand Building is to lead the specific country category 

and brand operations team to create, execute and evaluate the insight-led Category Building Plan and 

Brand Marketing Plans created by Brand Development. Development at local levels takes place in the 

form of packaging innovations and minor product modifications to fit local consumer needs and 

production methods. 

Marketing information is crucial for UBL and the company decisions are based to a large extent on the 

accuracy and timeliness of such information. Consumer and Market Insight (CMI) team ensure that 

data are collected cost effectively to provide consumer information to aid the company to attain a 

competitive advantage. This helps to achieve a proactive understanding of the Bangladeshi 

consumer. The CMI team carries out various market and consumer research through external 

research agencies such as Sirius and AC Nielson and also coordinates with regional CMI team to 

gather category research done globally. 

Brand activation is the core marketing process through which a brand is brought to life through a 

variety of brand experiences. The activation team builds a brand by creating a physical or emotional 

space in the consumers’ lives that enables the brand to interact in a meaningful way. These activation 

programs drive purchase and preference by building consistent, long term relationships with 

consumers. The responsibility of the media team is to buy media space, settle the different media 

packages for each brand and coordinate various partnerships and events with media partners. 

The Organogram on the following page depicts the different positions in Brands, Development, Media, 

Activation and CMI. 


Product Group 

Manager 

Fair & Lovely 

Marketing Manager 

Colour, Oral & 

Pond’s 

Product Group 

Manager Pepsodent 

Senior Brand 

Manager Pond’s 

Senior Brand 

Manager - 

Lifebuoy 

Product Group 

Manager 

Hair Care 


Chairman & Managing Director 

Brands & Development Director 

Company CMI 

Manager 

Marketing Manager 

Skin cleansing, fabric 

Wash & Household & Head of 

CMI 

Senior Brand 

Manager Wheel 

Co. Media Manager/ 

Product Group Manager 

Lux 

Activation Planning & 

Media Operations 

Manager 

Figure 4: Organogram for Brands and Development Department 

Company Activation 

Manager & Senior Brand 

Manager – Tea 

Company Development 

Manager 

Packaging 

Development 

Manager 

Product 

Development 

Manager 

* Company Media Manager reports to BDD for media related issues 

while has a double reporting line to MM for Lux related issues

3.1 Overview 

3.0 GLOBAL ICE CREAM INDUSTRY 

Global Ice cream industry is estimated at 43 Billion Euros 1 ($54 Billion) at the end of 2009. Unilever 

business is currently at 4.7 billion Euros ($6.04 Billion). Nestle’ outpaced Unilever with recent 

acquisition of U.S. Company Dreyer's Grand Ice Cream Holdings Inc and became world’s largest ice 

cream manufacturer with 28% market share compared to that of 17.6% Unilever share. 

3.2 Unilever Ice cream Business 

Unilever Ice cream business under the umbrella name of “Heart” brand (also known as Wall’s, 

Algida, Ola etc in different countries) has been one of the most successful businesses in the food 

category. As of 2009, Unilever ice cream sales stands as following. 

Region 2007 2008 2009 

Europe 2315 2,392 2,455 

North America 1,269 1,283 1,298 

Asia 444 506 576 

Latin America 408 430 452 

Total (Mln. Euros) 4,412 4,611 4,781 

Table 6: Unilever’s Global Ice cream Business 

Current market standing based on Underlying Sales Growth (USG) and Market share for Unilever in 

Asia is excellent and market is currently growing at a very high rate compared other three regions. 

Market is not saturated and many untapped countries like Bangladesh can provide more growth from 

this region. Unilever Portfolio under “Heart” or “Wall’s” brand looks as follows: 

Magnum 

Magnum Cornetto Carte d'Or Carte d'Or 

Light 

Figure 5: Unilever Ice cream Portfolio 

Breyers 

CarbSmart 

Solero Ben&Jerry’s 

Among these Magnum is Premium Extrusion stick, Cornetto is Cone, Solero is fruit based and 

Ben&Jerry’s is super premium ice cream that is sold through dedicated boutiques. Others are filled 

SKUs. In recent times there have been additions of sub-brands like Frusi and Moos. 

1 Source: Reuters (Global AC Nielsen study) 


3.3 Regional Ice cream Business and Unilever 

3.3.1 Ice cream Consumption: 

World ice cream consumption data shows scopes and opportunities for Unilever in this category. Per 

capita consumption (PCC) of ice cream in the South Asian region is pretty low with 0.1 litres per year. 

Bangladesh PCC is also estimated to be similar where people consume ice cream less than once a 

month as can be seen from the following chart 2 . 

Country Per Capita Consumption 

Volume 

(ltrs/yr) 

Value 

(Euros/yr) 

Consumption 

Pattern 

Australia 18.0 48.0 > 8 times / month 

Hong Kong 2.4 11.0 

Singapore 2.4 11.9 

Malaysia 1.6 3.0 

Thailand 1.5 1.8 

China 1.0 1.1 

Philippines 0.8 1.5 

Pakistan 0.4 0.4 

Indonesia 0.2 0.4 

India 0.1 0.1 

Table 7: Per Capita Ice cream Consumption of Countries 

2 -3 times / 

month 

< 1 once / month 

This represents the challenge for the category in this region to be: “To Grow the Category & 

Increase Market Share”. 

3.3.2 India Ice cream Business and Unilever: 

Overall Ice cream industry in India is as follows: 

Detail 

Total 

Market Impulse 

Take 

Home Artisan 

Value (Cr BDT) 1687 56% 34% 10% 

Volume (‘000 Ltrs) 75407 54.5% 40.2% 5.3% 

CAGR (Volume) 11% 10.43% 11.33% 12.63% 

CAGR (Value) 13.52% 13.19% 13.91% 14.02% 

Gross Profit 49.9% 48.20% 51% 55% 

Table 8: Glimpse of India Ice cream Business 

This market data has been considered to understand a similar but evolved market. In the Indian 

market, Kwality Wall’s (a merger between Unilever and Kwality) with its mother brand and two sub 

brands Cornetto and Max has 16.19% market share in the market. However recent strategic change 

towards focused distribution and marketing approach in six major cities (Mumbai, Delhi, Calcutta, 

Chennai, Hyderabad and Bangalore) that contribute to two thirds of total Unilever sales has provided 

Unilever recent success in the category in India. 

2 Source: Unilever Pakistan Ltd. CMI 


4.1 Industry Construct 

4.0 BANGLADESH ICE CREAM INDUSTRY 

The ice cream industry of Bangladesh is a growing one. With an estimated market size of BDT 220 Cr 

in 2009, the market can be subdivided broadly into branded and unbranded categories. 

Common 

[BDT 121 Cr] 

Branded 

[BDT 131 Cr] 

4.1.1 Branded Market: 

Boutique 

[BDT 9.8 Cr] 

Total Market 

[BDT 220 Cr] 

Figure 6: Market Construct of Bangladesh Ice cream Industry 

Unbranded 

[BDT 79 Cr] 

Around 20,000 local manufacturers 

The branded market segment is around BDT 131 Cr with players in both common/ conventional ice 

cream format (BDT 121 Cr) and boutique format which is still very small in size (BDT 9.8 Cr). 

Common Format: 

Common format ice creams are generally produced and packed in factory. These are distributed and 

sold through retail channels/ carts to the shoppers. Products can be single serving like stick and 

cones or multiple serving like containers. Moreover, single serving can either be water based where 

only water and flavours are mixed or cream based where milk cream and flavours are mixed. 

Branded common format ice cream industry has only five players in the market. They are Igloo, Polar, 

Kwality, Savoy and Milk Vita. Igloo is currently the market leader. Polar stayed market leader for 10 

years (’86-‘96) in their initial days and Kwality challenged and took Polar’s second position in recent 

times. However, Igloo bounced back every time they faced challenge. Milk Vita came in the market 

with proper dairy ice cream but failed to create an impact as their core business is not ice cream. 

Boutique Format: 

Boutique format ice creams are sold through dedicated outlets where there is seating facility for 

consumers. They can see the products/ flavours open in freezers and can choose directly. Also 

consumers can decide what type of packing to use e.g. cup, cones or containers and based on the 

consumers decision product is either served for consumption at the premises or take away. 


Boutique format has seen an upsurge from year 2000 with introduction of premium, franchise and 

imported ice creams. This segment is driven by Dhaka and Chittagong based players. Club Gelato, 

MövenPick, Andersen’s, Gelateria Igloo, Baskin31Robbins and Sub Zero are the major players in the 

segment. Among these, Gelateria Igloo and Sub Zero are run by common format players Igloo and 

Kwality respectively. 

4.1.2 Unbranded Market: 

The unbranded market basically is constituted with around 20,000 local small producers that do not 

use any brand leverage and compete in the market based on significant lower price in the range of 

BDT 1-5. 

Market size of this segment is significantly high with BDT 79 Cr. These producers are mainly rural and 

suburb based where concentration of SEC C and lower SECs are high. They mainly produce water 

ice cream sticks or in colloquial terms “Baarfi”. These are made with saccharine and colours. They 

also produce small amount of milk based kulfi. These ice creams are very unhygienic and of low 

quality. 

4.2 Historical Progress of the Industry 

� Before 1964: Ice cream market dominated by unorganized unbranded approach. 

� 1964: Igloo started large scale organized approach under K Rahman & Co. Ltd. 

� 1965: Igloo opened up the first ice-cream parlour in Dhaka. 

� 1971: Igloo was nationalized by the government of Bangladesh after liberation. 

� 1972: In June Igloo was handed over to Bangladesh Sugar & Food Industries Corporation. 

� 1983: Abdul Monem Ltd. acquired Igloo under privatization policy. 

� 1986: Polar started operation; introduced food grade plastic based packaging. They immediately 

became market leader with extensive campaign. 

� 1988: Dolce Vita Gelato, one of the dedicated boutique operator brought premium ice cream. 

� Early 1990s: Rainbow and Snow White started extensive operation in the boutique segment. 

� Late 1990s: American Soft Ice cream started promoting the soft ice cream format. 

� 1995: Savoy was introduced but failed due to product quality though in suburban areas they 

grabbed share with low price. 

� 1996: In September, Igloo organized a massive marketing campaign 

� Introduced the first straight line extrusion ice-cream in the market 

� They initiated a massive campaign and became market leader after 10 years 

� 1997: In February, Igloo took a devastating decision to increase price for the cup line 

� Igloo not only incurred substantial financial loss but also lost the hard earned market 

share. The question of sustaining became a central issue. 

� In summer, Price of 11 items were revised and communicated as special discount. 

� This instantly pushed them to the number one position. 


� 1999: Kwality ice-cream entered the market 

� 2000: Entry of the premium boutique operators like Club Gelato, MövenPick and 

Baskin31Robbins. 

� 2002: Kwality launched an extensive campaign and started to capture the ice-cream outlets of the 

city by providing freezers. 

� 2004: Kwality’s number of freezers exceeded Polar’s and moved to second position. 

� 2005 onwards: Igloo leads the market and there is immense competition among Polar and 

Kwality for the coveted 2nd spot. 

Historical progress of this industry is of great importance. Bangladesh ice cream industry has 

traditionally been exposed to high quality products for a long time. Igloo initiated the progress of 

boutique segment (1965) but it lost its way over time. The segment picked up once again in the recent 

years. Also high quality products and innovations in the common format segment have created an 

appreciation for continuous innovation and better products in the minds of the consumers. Consumers 

in Bangladesh see ice cream as a fun product which requires novelty and quality coupled with 

continuous hype around the brand. This is why we see Kwality and Polar could create early impacts 

with their entry into the industry as they came up with innovations in product or packaging and 

arranged massive marketing campaigns during their launches. Igloo had to minimize their effects with 

similar campaigns to hold on to their position. 


5.1 Market Description 

5.0 MARKET & COMPETITION ANALYSIS 

Bangladesh ice-cream industry is growing. With increasing market demand, size of the industry is 

growing but due to entry barriers of lengthy and complex production process and high investment few 

companies enter this business. Although local companies in the branded segment have captured 

most of the market share, small unbranded local companies own a huge market to themselves. 

Where branded ice cream consumers look for innovation and quality, unbranded users outside metro 

cities are currently inclined towards low price low quality products. This creates an opportunity for 

further market development on the hygiene and health platform. On the other hand, the boutique 

industry is doing quite well with their approach towards ice cream as a dessert item along with service 

of other snacks like cakes and coffee at their premises which help them reduce seasonality effects of 

ice cream. 

With a complicated scenario in the market, to analyze the industry condition and understand the 

competitive realities, details of market characteristics and players of both common and boutique 

segments are explained in following sections. However, unbranded segment is excluded from 

discussion as Unilever’s portfolio does not match the characteristics and price level of this category. 

5.1.1 Market Characteristics of the Common Format Segment: 

A. Market size: 

Due to promotion, innovation and exposure to different cultures the consumption of ice cream has 

increased. As a result the total market size is expanding. At present the local companies in the 

common format segment have a huge market of about BDT 121 Cr. This market is 16 times larger 

than the boutique segment and nearly doubles the unbranded segment. Over the years, the size 

increase of the industry shows the prospect of converting unbranded unhygienic ice cream consumers 

into branded ice cream consumers. However, price level still remains a big problem for the branded 

category as petty unbranded ice cream companies with a price range of Tk.1 to Tk.5 have a total 

market size of BDT 79 Cr which shows a hint of high price sensitivity in lower SEC consumers. 

Overall market size of 220 Cr indicates that most of the people in the country are exposed to ice 

cream or some kinds of derivatives of ice cream like “Baarfi”, however, they probably cannot afford 

higher priced icy fruit sticks (BDT 6-10) available in the branded segment. 

B. Competitive rivalry in the Market: 

Competition is not very intense among the existing five companies because the number of operators 

is very small considering the total population. Also, complexities of production and distribution process 

and other entry barriers are stopping new companies from entering the industry. 


Igloo is confident about its unbeatable first position, but there is competition among other companies 

such as Polar and Kwality for the 2 nd position. However, in current market, no operator is showing 

much aggressive and visible activity towards growth. It is expected that recent announcement 

regarding introduction of ISIS diabetic ice cream by Polar in partnership with DANONE would again 

create some hype in the market. 

Reasons behind existing level of rivalry among competitors can be attributed to following reasons: 

� The ice cream industry has few sellers because there is economy of scale through large-scale 

production. The larger firms have a cost advantage over smaller firms; they can produce more 

cheaply- making it hard for small firms to survive. 

� Market is bigger than capability of current players and can accommodate them without much 

trouble. This is because PCC of ice cream in the country is still pretty low. 

� This market has substantial amount of “barriers to entry”, making it difficult for a large number of 

competitors to enter the market. The cost of setting up a new plant in this industry is quite high. 

The cost of entry works as an entry barrier. 

� To get people to try new product, the potential entrant will have to run a big competitive 

advertising or massive promotional campaign, which is expensive. The prevailing companies 

created barriers in entry for potential rivals by using extensive advertising and product 

differentiation earlier which has its effects till now. Another fact is that product awareness and 

brand loyalty to the existing firms make it expensive for potential rivals to enter. 

� To further elaborate present competitive reality of the industry the five competitive forces are 

discussed below: 

� The rivalry among the competing sellers is weak as market is yet to develop more. 

� With various entry barriers not many new companies are attempting to enter this industry. 

� As there are no direct substitute products to ice-cream, the companies don’t face any 

competition from other industries. 

� As the number of suppliers is very low and, the companies especially Igloo as the best 

product enjoys high bargaining power or leverage over rivals. But some of the companies 

such as Savoy are concentrating on increasing profit margin of the retailers for securing a 

more prominent position in the market. 

� Mainly consumers or buyers decide the pricing. Keeping in mind the various buying power 

of people, the companies decide the price of each items. Price of the Items that have the 

most market demand is kept low so that they are in the reach of the general customers. 

By lowering the price some companies such as Savoy are trying to maintain a competitive 

edge. 


C. Market Sales and Growth Rate: 

Sales information of the five existing companies for the current years shows the following trend. 

Company 

Name 

2007 2008 2009 

Total Market 113.07 121.20 131.22 

Igloo 57.85 60.86 64.25 

Polar 16.8 18.35 20.19 

Kwality 30.6 33.5 37.4 

Savoy 3.88 4.15 4.58 

Milk Vita 3.94 4.34 4.88 

Table 9: Market Sales and Growth Rate of Branded Common Format Market 

Volume based market size shows the following scenario prevailing in the Bangladesh market in 2009. 

Company Single Vol Multi. Vol Total Vol 

Name 

Total 

('000 Ltrs) ('000 Ltrs) ('000 Ltrs) 

Market 3275.9 4296.7 7573 

Igloo 1676.0 2198.3 3874 

Polar 486.7 638.4 1125 

Kwality 886.5 1162.8 2049 

Savoy 112.4 147.4 260 

Milk Vita 114.1 149.7 264 

Table 10: Volume Based Market Size 

The total volume of the branded common format ice cream industry is 7500 Tons of which more than 

50% belongs to Igloo, followed by Kwality with 27%. 

D. Market Share and Size of the rivals: 

Market share data for all the local companies show a trend where Igloo is the biggest ice-cream 

company dominating with a huge market share. Although even 1-2 years ago there was intense 

competition between Kwality and Polar but now it seems that Kwality is 2 nd largest ice-cream 

manufacturing company in Bangladesh. Polar is in the 3 rd position with Savoy and Milk Vita trailing in 

the market. Market share percentage over the years is presented in the following table. 

Company 

Name 

2007 2008 2009 

Igloo 50% 50.31% 51.16% 

Kwality 25.6% 26.66% 27.06% 

Polar 17% 16.1% 14.85% 

Milk Vita 3.4% 3.32% 3.48% 


E. Geographic Sales Orientation: 

Savoy 3.9% 3.65% 3.43% 

Table 11: Market Share of Competitors 

Ice cream still continues to be a city-oriented product and its demand is comparatively low in the rural 

areas. Reasons behind this are electricity problem outside urban areas and purchasing power of 

people. Geographic sales orientation of the common format ice cream industry is provided below. 

4.80% 2.50% 5.90% 

6.90% 

18.90% 

Dhaka Chittagong Khulna Comilla Barisal Others 

Figure 7: Geographic Sales Orientation 

Dhaka still is the largest contributor in the ice cream segment. Nevertheless, over the years this trend 

is shifting. Areas outside Dhaka are also growing making Dhaka’s share lower by small percentage. 

As urban markets are the major contributors, companies design their products keeping in mind the 

tastes and styles of the urban consumers. Compared to the other companies Igloo is the most 

expensive in the common format segment, so they target only city based customers who have the 

purchasing power. Although other companies such as Savoy are offering low priced product, even 

their main target is urban people due to nation wide electricity problem. 

F. Seasonality of Sales: 

Ice cream industries in warmer part of the world are highly seasonal. Same is true with Bangladesh. 

According to secondary data sources sales seasonality looks as follows: 

61% 

Period Name Months Contribution 

Super-Peak April, May, June 46% 

Peak March, July, August 36% 

Off-Peak February, September, October, November 15% 

Super Off-Peak December, January 3% 

Table 12: Seasonality of Ice cream Sales 

This data was validated through interviews with retailers during market visit. According to them more 

than 75% sales of ice cream came in the hot months. Another insight that could be identified was 


various festivals and programmes provide scope for higher volume of ice cream sales. According to 

companies where only 10-15% sales occurs in the winter season, same amount of sales occurs 

during festivals like the two Eids and Nobobarsha. 

G. Distribution/ Servicing System: 

Mainly common format ice-cream is distributed in two methods that are directly to retail shops and 

through hawkers with ice cream carts/ trolleys. 

The various channels of retail shops other than cart that serve as distribution outlets for Ice cream 

are: 

7. Urban General Stores (UGS) 

8. Urban Neighbourhood Grocer (UNG) 

9. Premium General Store (PGS)/ SMMT 

10. Confectionary/ Bakery 

11. Modern Trade (MT) 

12. Fast Food shops (Recently some fast food shops keep branded ice cream cabinets) 

Distribution details of all the companies are provided below. However, detail of Milk Vita is not 

available as they are mainly milk producer and they have no dedicated ice cream cabinet for retail 

stores and currently they are not distributing ice cream in Dhaka city. 

Company 

Distribution 

Method Frequency 

No. of 

Cabinets 

No. of 

Carts 

Igloo Distributor/ Cart 2 to 3 times a week 4000 100 

Kwality Distributor/ Cart 1 to 2 times a week 1050 20 

Polar Distributor/ Cart 1 to 2 times a week 800 50 

Savoy Company 1 to 2 times a fortnight 176 - 

Milk-Vita - - - - 

Table 13: Distribution Method of Market Players 

Distribution Process: Distribution process through both methods is described below. 

Retail Distribution: The general distribution that is followed by companies is that distributor sends 

large refrigerated trucks dedicated to specific territories. These trucks are accompanied by small 

refrigerated vans. Main road side shops are served directly from the large truck and shops that are 

inside small streets are served by the small vans. 

Order and delivery are done on the same day. The strategy followed is that of replenishment. If the 

branded freezer of the company is empty, they simply fill it up according to requirement of different 

SKUs as the delivery people see fit. However, shopkeepers have to buy full cartons (usually 24 pieces 

in a carton) of single serve ice cream; they cannot buy in pieces. 


Among the retail shops, there are about equal numbers of branded and unbranded freezers. This is a 

normal scene in Dhaka where all shopkeepers require freezer to keep other cold products. However, 

basic distribution policy is that, if a shop has branded cabinet of a company, they cannot keep 

competitor ice cream in that cabinet. Thus, penetration can be made possible in shops where 

unbranded freezers are available. 

General branded freezer contract policy with Igloo and Polar is that traders have to pay BDT 5000 to 

take a freezer. Maintenance of branded freezers is responsibility of the company but electricity bill is 

paid by shopkeeper. However, Polar is not currently giving any new freezer. Kwality gave away their 

freezers for free; however, they ensured safety of their freezers by checking background of the 

shopkeepers. 

Cart sellers: Cart sellers collect required amount of ice cream from nearby distribution house or 

company showroom (Igloo has one showroom in Panthapath) on a daily basis. They also have to buy 

cartons of products, not pieces. Kwality carts collect their ice cream from factory (Tejgaon) or nearby 

distribution house. Cart sellers contribute around BDT 3000 sales in a day and generally sell at BDT 

1-2 higher than set price of each product. 

The cart sellers generally keep at least a two-day stock so that they can meet sudden upsurge in daily 

demand of ice cream or if they get the opportunity to sell at parties, programs or any open air event 

(Wedding at community centres or outside cultural programs at auditoriums). If cart sellers need 

replenishment of stock, they even take service more than once in a day either revisiting showroom/ 

house or they call up company delivery people to serve them at their location if there is opportunity for 

selling more ice cream. 

Policy regarding Damaged Ice cream: All the ice cream producers have very good relationship with 

the shopkeepers. If the retailers have refrigeration problem, company takes ice cream back until the 

problem is fixed, whether it is stored in branded freezer or not. Also if any ice cream gets damaged or 

there is bacterial formation, company takes them back. Usual return time varies from 15-30 days. For 

large sellers however, they take less time. 

Payment Method for Ice cream Purchase: All the companies give credit of around one month to 

large volume contributing retail sellers and try to maintain good relationship with them. This trend is 

seen in all channels. Also all the SMMTs and MTs are given credit of one month and payment is 

made by cheque. Other small shopkeepers have to purchase with cash. However, according to 

shopkeepers Igloo is currently trying to cut down on credit sales as they believe there is a consumer 

pull for their brand. Companies like Polar and Kwality also give special commission to large sellers. 

Polar gives 5% commission on every bill. 


H. Technology and Innovation: 

Technological advancement in the ice cream industry has been very rapid. Starting with stick mould 

and filler ice cream production, the companies have come a long way. Assessing the consumer 

choice and demand the companies are introducing new products very often. Improved and new 

technology is used for faster production and better quality. Igloo is trying to meet the international 

standards and launching products such as Sundae, Cornelli, and Nuggets. Other companies are also 

introducing new flavours suitable for their target segments. Igloo has both the ISO and the HACCP 

certifications. These were awarded in the year 2003 due to their relentless pursuit of quality and 

innovation. In September 1996, Igloo introduced the 3D Mould line and straight line extrusion 

technology for the first time in the subcontinent. Basically, with Igloo’s pursuit, all the modern 

technologies and quality innovations are available in the market. 

I. Production Capacity: 

Current production capacity of the major players in the common format ice cream segment is 

estimated to be as follows: 

Name 

Capacity 

(Ltrs/ day) 

Total 

Production 

('000 Ltrs) 

Required 

Capacity (at 300 

production days ) 

Estimated unutilized 

capacity (Ltrs/ day) 

Igloo 22000 3874.33 12914 9086 

Polar 6500 1125.13 3750 2750 

Kwality 12100 2049.34 6831 5269 

Savoy 1560 259.85 866 694 

Milk Vita 1330 263.87 880 450 

Table 14: Production Capacity of Current Market Players 

From the table we can see that all the ice cream manufacturers are operating with unutilized capacity. 

However, one point to be noted is that different ice cream SKUs require different amount of item to be 

produced. Exact machine production capacity at litre per day does not represent the accurate 

scenario. Nevertheless, it can be safely assumed that all the manufacturers have unused machine 

capacity at their premises. Moreover, the larger players like Polar and Kwality have new technology 

available at their premises. Kwality bought second hand machines from Thailand but both Igloo and 

Polar bought their’s from Italy and Denmark. 

J. Products and Pricing: 

Products: The products in the ice-cream market are differentiated. A few firms dominate the market, 

but an endless variety of ice creams are offered to the consumers. Igloo pioneers all major 

innovations in the market. The products that are available in the market can be classified into single 

serving and multiple serving groups. Which are then categorized based on functional attributes/ 

designs. These are: 

Single Stick Normal mould, 3D mould, extrusion 


serving 

Multiple 

Cup and Sundae Flat cup, long cup 

Cone Normal cone (vanilla, strawberry etc), premium cone (Ripple) 

Innovative Fillers Snowball, Animal shaped containers, sandwich, nuggets etc 

Container 0.5 ltr, 1 ltr and 2 ltr containers 

serving Family Pack Assorted packs, cakes, shahi kulfi etc 

Table 15: Ice cream Serve types 

Among all the products available in the market, most selling SKU for all the companies is Choc-bar 

stick and highest selling flavour is Vanilla. Following are the ranks of most selling SKUs and flavours. 

SKU Name Rank 

Choc-bar (70 ml) 1 

Vanilla Cup (100 ml) 2 

Vanilla Box (0.5 and 1 Ltr) 3 

Lemon Lolly (70 ml) 4 

Normal Cone 5 

Flavour Rank 

Vanilla 1 

Chocolate 2 

Strawberry 3 

Ripple 4 

Mango 5 

Table 16: Rank of SKUs Table 17: Rank of Flavours 

Choc-bar is one of the earliest vanilla based chocolate coated SKU that has dominated the market 

strongly over the years. Shopkeepers could not provide an exact percentage on SKU based sales 

contribution. Most of them ranked the SKUs and flavours according to sequence shown in the above 

table. Also, according to newspapers and secondary sources Vanilla is the most selling flavour with 

60% sales contribution. According to secondary sources percentage sales contribution of various 

types of SKUs in the common format segment are as follows: 

Type of Ice cream 

Value 

Share 

Volume 

Share 

Impulse dairy ice cream 51.4% 44.3% 

Impulse water ice cream 11.2% 13.8% 

Take-home dairy ice cream 37.4% 41.9% 

Table 18: Volume Share of Different Serve Types 

Impulse dairy ice cream provides more value share as price per litre is higher than take home multiple 

serving ice creams. Impulse water ice cream shows a similar trend as of take home ice cream. 

Pricing: Product pictures and price ranges of each category are provided below. 


Stick 

Cup 

& 

Sundae 

Normal Cup Sundae Premium Cup 

Price Tk.12 Tk.20 Tk.25 

Cone 

Normal Premium 

Price Tk.20 Tk.25 

Container 

Normal Ice Fruit Normal Cream 3D Mould Premium Extrusion 

Price Tk.10 Tk.15 Tk.15 Tk.20 


Price/Ltr. Tk.100 Tk.175 

Innovative 

Fillers 


Price Tk.20 Tk.25 

Family 

Packs 

Kulfi Cake Mixed Pack 

Price/Ltr. Tk.150 Tk 175 Tk 190 

Figure 8: Serve Types and Pricing 

Single 

Serving 

Multiple 

Serving 

As it can be seen from the above chart, all impulse ice creams are priced within the range of BDT 10 

to 25. Other take home multiple servings are priced within the range of BDT 50 (0.5 Litres) to BDT 

220 (2 Litres). Another noticeable factor in price is that there are both normal and premium flavours in 

all types of ice creams. 

K. Firms as Price Setters: 

The firms have capability to affect the market price to be low as profit margin is very high. If Igloo 

reduces the price of an item below the prevailing price level in order to increase its sales, its 

competitors will fear that their customers will go away from them to buy Igloo products. To retain their 

customers they will be forced to match the price cut of Igloo. Historically this has been proven to be 

true. However, due to price sensitivity, companies cannot drastically increase price even if they 

provide higher quality of product. It was seen in 1997 when Igloo increased price of 11 SKUs and 

faced drastic sales fall during that time. It shows that the industry might welcome overall industry price 

increase but not individual company price increase. 

L. Promotion: 

The promotion scenario in the industry is not quite organized as of now. Even proper data regarding 

promotional expenditure is not available from research sources. The reason being, there is not much 

consumer related activity seen in the market. After Kwality’s introduction in the market in 1999, Igloo 

went on with massive Television promotion of their new products that were available at that time. 


However, in current times there is no TVC running from any company. Companies promote their 

launches mainly through billboards and newspaper promotions which is currently the most used 

source of consumer promotion. Some promotional activities that were done by the companies over 

the years are listed below. 

Consumer Promotions: 

1. Larger players like Igloo and Kwality goes on with campaigns like “Gift on stick” where various 

prizes’ names are written on the sticks and consumers can get them. 

a. Igloo ran a program on their launch of Macho variant where gift varied from cricket 

bat to personal computer. 

b. Igloo had a program in 2006 where gifts on sticks varied from Bangkok visit to 

sunglass. 

c. Igloo ran one campaign in 2007 where gold bars were given on purchasing Choc-bar. 

d. Kwality ran a similar program in 2008 where gifts varied from wrist watches to 

motorcycle. 

2. Some companies ran consumer TTS and gift programs where company products were given 

free. 

a. Igloo had a program in 2006 where Igloo butter was given free on purchasing Igloo 

ice cream cake. 

b. Kwality ran a program in 2008 where one SKU was given as gift with another SKU 

randomly. 

c. “Cone Ice cream at your Home” program was run by Igloo in 2002 where six cone 

biscuits were given free with purchase of one litre ice cream. 

3. Media placement is another form of placement done by larger companies. 

a. Igloo purchased “Glimpse into World Cup Result” space in daily newspapers during 

World Cup Football 2002. 

4. One interesting program is done by only Igloo in Bangladesh. They did it in June 2006. The 

program was “Igloo Ice cream Festival” with main attractions of “Get as much ice cream as 

you want for BDT 200”, “Get a Fantasy Kingdom Entry ticket with each Entry Coupon”, “Lucky 

Draw” and “Celebrity Adda”. 

Trade Promotions: 

5. Trade promotions are mainly given to “Highest retail purchasers” and also based on time 

bound trade schemes where various slabs of purchase amount are mentioned for different 

prizes. 

a. Igloo takes their highest purchasers to visit countries like Singapore and Thailand. 

b. Savoy has a purchase slab scheme where first prize is table fan. 

c. Polar gives special sales commission to their highest purchasers (around 5%). 


M. Players in the Common Format Segment: 

Branded common format ice cream segment is constituted of five players only. Among them Igloo is 

the largest player and Milk Vita is the smallest. The following sections detail the basic company detail 

of all the companies with special emphasis on Igloo, the market leader. 

Igloo: 

The pioneering ice-cream company in Bangladesh started its operation in 1964 in Chittagong under K 

Rahman & Co. Limited (KRC) with a small factory inside Coca Cola bottling factory of KRC. After the 

independence of Bangladesh in 1971 Igloo was taken over by the government of Bangladesh. Later in 

1983, Abdul Monem Limited purchased the entire production setup of KRC Limited including Coca- 

Cola bottling plant and Igloo ice-cream factory. After taking full charge of Igloo ice-cream by Abdul 

Monem Limited the manufacturing operations continued in Chittagong till 1990. Although, Dhaka 

fetched the maximum share of the total revenue, the distribution cost increased tremendously in the 

process of meeting the demand of Dhaka city. To cope with the distribution problem and handle Polar 

threat, Abdul Monem Limited transferred the factory to Dhaka, changed the ice-cream packaging from 

the conventional paper to plastic and expanded their market and distribution operation. The new 

factory of Igloo was setup at Shyampur, Narayanganj and was nine kilometres away from the 

Motijheel office. The company apart from catering the capital city started to expand its operations in 

Comilla (1991), Khulna (1992), and North Bengal (1993). These markets were served directly from 

Dhaka since the storage facilities were not developed till then. The company is now the market leader 

since 1997 with clear market share victory over others with sweeping 51% share. It is to be noted that 

Igloo is also a player in the boutique segment with three parlours (2 in Dhaka and 1 in Chittagong). 

Product Range: Igloo offers the widest choice of ice cream, more than any other competitor in the 

market. Igloo is offering a total of fifty items, including normal premium and novelty cup, stick and 

family pack items. Igloo has thirty flavours, more than anyone else in the industry and is continuously 

launching new and innovative delicacies. 

Igloo ice-cream can be classified in six groups. They are: 

Stick Macho, Choc-bar, Mini Choc, Clown, Mega, Shell n core, Lolly 

Cone Cornelli 2 in one, Cornelli classic 

Cup Shahi kulfi, Vanilla, Strawberry, Mango, Snow ball 

Container Vanilla, Strawberry, Mango, Chocolate, Coffee, Diet Vanilla, Tutti 

Frutti, Ripple, Pralin, Pistachio 

Innovative Nuggets, Sandwich 

Family Ripple cake, Party time, Shahi Kulfi 

Table 19: Products of Igloo 

Single serve stick, cups and cone items are easy to carry around and convenient to eat which makes 

it most sold. The core target segment of ice-cream is 6-24 years and this generation is always on the 


move and thus prefers independent cone, stick or cup items. As Igloo initiated the concept of ice- 

cream as a family product, they offer some items to be enjoyed with the whole family. 

Quality and Innovation: Igloo is committed to maintaining the highest quality standard, through its 

continuous R&D activities. The major ingredients, raw materials and packing materials are procured 

from the best European sources. Strict quality control is done at every stage of the manufacturing 

process, from procurement of material, mixing, material flow, ice cream making, packaging, storing (at 

main warehouse), distributing and market shelving, by the Quality Control Department. Current supply 

chain for various materials of Igloo is as follows: 

Australia 

(Milk Powder) 

Denmark 

(Ingredients, 

emulsifiers & 

stabilizers) 

Figure 9: Igloo Supply Chain 

China, Denmark, 

Singapore & 

Thailand 

(Food grade 

packing materials) 

China & UAE 

(Food grade 

sticks) 

Distribution Network: Their distribution network is stretched all over the country with a long fleet of 

refrigerated vans. Firstly, the ice cream products are stored at the central warehouse of the factory, 

and from there they are distributed through the haulage vehicle to the operational centres located in 

Dhaka, Chittagong, Comilla, Rajshahi, Barisal, Bogra, Rangpur and Khulna. Strictest cold chain 

maintenance during the distribution and selling of the ice creams is ensured. Their distribution process 

is as follows: 

Manufacture Stored at -24c Transported by 

Refrigerated trucks at - 

Retail outlets 

(Deep freezers) 

Refrigerated 

vehicles 

(Distributors) 

Figure 10: Distribution Process of Igloo 


Reaches & 

Preserved in 

Eight regional stores

Trolley Operation: Igloo also operates through trolleys for extending its reach to consumers at the 

furthest points. The trolleys are operated near schools, alleys, streets, parks etc. and play rhythmic 

music to attract the consumers. These are very colourfully decorated with Igloo umbrella and the 

puller wears specific uniforms. Igloo was the first in introducing and operating these trolleys in 

Bangladesh for any Fast Moving Consumer Goods (FMCG). Igloo has around 125 trolleys operating 

throughout the country. Individual trolleys are provided with a regular supply of igloo ice creams. 

Marketing: The marketing commitment of Igloo is based on the relationship with its customers and 

consumer by not only manufacturing the highest quality product but also delivering the product by 

maintaining this quality. To satisfy the ever-changing needs of the customer, Igloo has regularly 

launched new ice creams and introduced new flavours. And this commitment has positioned Igloo as 

the market-leading brand by gaining the consumers trust with the positioning as: “A WORLD OF 

GREAT TASTE”. 

Facilities and Logistics at a glance: As of 2009, following are the facilities and logistics enjoyed by 

the company. 

Kwality: 

Factory location Dhaka 

Production Lines 4 

Packages 

Stick, Cup, Family pack, Others (Nuggets 

and sandwich) 

� Mark-Italy 

Machine suppliers 

� 

� 

Tetra Pak(Hoyer)-Denmark 

Sabore, Denmark 

� Hass- Austria 

� Freemark 1100, Italy 

Machine models 

� FM 3000, FM 6000, Italy 

� SL600, Denmark 

Cone baking Hass- Austria 

Chocolate making Macentyre-UK 

Coverage Nationwide 

Operational centre 10 

Total market vehicles 30 

Distribution channel Direct/through appointed distributors 

Outlet service 7500 

Injected deep freezers 4000 

Trolley operations 125 

Warehouse no 8 

Table 20: Igloo Facilities and Logistics 

Kwality is currently the second largest ice cream manufacturer of the country. The mother company 

for the Kwality brand is Sanowara Drinks & Beverages Ltd, a sister concern of Sanowara Group. The 

company is famous for powdered milk brands Red Cow and Diploma in Bangladesh. The drinks and 

beverage concern of Sanowara made an entry into the market in 1997 with “Yes” brand drinking water 

and launched the ice cream brand in 1999. With heavy communication and novelty products it 


successfully removed Polar from the second place with a current market share of 27%. The company 

also operates in the boutique segment with two parlours in Dhaka and Chittagong. 

Kwality ice cream factory is situated in Chittagong with a floor space of 35,000 sft and fully automated 

machinery/ wrapping/ mix machinery equipments from Italy having capacity of around 20,000 litres of 

ice cream per shift. The ice cream factory employs 140 people. The company is ISO 9001-2000 

certified. 

Kwality was the first true competitor for Igloo products with some major innovation in product design 

and communication but their quality is perceived to be lower in the minds of the consumers and they 

do not have extrusion ice cream. The product prices are also similar to that of Igloo but they charge a 

bit lower than Igloo in premium multiple servings. However, during market visits it was seen that 

shops that keep only Kwality or Igloo and Kwality both, they can sell Kwality too although the sales 

amount is lower than that of Igloo. People who look for Igloo, shopkeepers give them that directly but 

if they get a chance and Kwality ice cream stock is high, they also push Kwality to dry the stock out. 

This gives an indication that market is larger than what the current players are capable of serving 

even in Dhaka. 

Kwality follows a similar distribution model like Igloo but distribution frequency is lower and amount of 

cart sellers is limited to 25 and they operate only in Dhaka. 

Polar: 

Once a giant in the industry, Dhaka Ice Cream Industries Ltd. introduced the first hygienically packed 

ice cream in Bangladesh in 1987 and the brand name "Polar" was thus born. In the early days, the 

company started ice cream business with a wide range of products and a variety of flavours in Dhaka 

city. In 1988, the company started its distribution in the city of Chittagong, then Bogra, and continued 

to cover more cities. Presently, Polar ice cream is available throughout Bangladesh. The company 

today trails in the market with 15% market share in the common format segment. Recently, Polar has 

announced launch of ISIS diabetic ice cream with support from DANONE to turn around in the market. 

The company has its head office, as well as a modern, large-scale industrial plant in Dhaka. Polar ice 

cream is made with Danish expertise, using Danish equipment and technology. The production 

activities and quality control measures are supervised and managed by Danish experts. Polar offers a 

wide range of delicious flavours and tastes made by ingredients imported from Europe. 

Dhaka Ice Cream at present has 3 cold stores in Dhaka, Chittagong and Bogra, in Bangladesh. From 

Dhaka cold store, they distribute ice creams in Mymensingh, Tangail, Jamalpur, Sherpur, Kishoreganj, 

Netrakona, Comilla, Narsingdi, Barisal, Madaripur, Agaeljhara, Faridpur, Magura, Chuadanga, 

Jessore, Satkhira, Khulna, Pirojpur and Sylhet through their distributors. In case of long distance 

delivery points, the company uses auto cooling freezer van. 


In Dhaka city, they distribute ice creams directly to retail stores in freezer vans. Besides that, they 

have several distributors at different points of the city. Distributors cover their individual areas where 

company is not able to supply directly in their freezer vans. Similar model is followed by the company 

to distribute ice cream from their other cold storages through out the country. For storing and selling 

ice creams in retail stores, the company like the other players arranges a deep freezer with the Polar 

logo and canopy light box. 

In addition to this distribution, the company also undertakes home delivery of ice creams for special 

occasions. 

Savoy: 

Savoy Ice-cream brand is owned by Sena Kalyan Sangstha (SKS) Group of industries. It started its 

journey in March 1995 with a factory in Tejgaon, Dhaka. Yearly turnover is estimated at BDT 3.88 

crores with a market share of roughly 3.5%. 

The factory has been established with Sonali Bank finance at 60:40 equity ratio. The total production 

capacity of the factory has been estimated at 2400 litres of Ice-cream per day. Total land area of the 

factory premise is 1.16 Bigha with 8,000 sft area covered with a total project cost of BDT 1.44. The 

factory employs 73 people. 

Product ranges of the company include all the basic designs and flavours of the industry. However, 

the company has not been much of an innovator in the industry. Their product quality is substantially 

low than that of other players and they price their products at 10-15% lower than the other 

competitors. The company imports raw materials mainly from Europe. The general raw materials are 

Euro cream, Skimmed Milk Powder, Cocoa Powder and Flavour (Vanilla, Mango and Strawberry), 

Colour (Yellow, Red, Chocolate and Green), Ripple Sauce, Cheney Fruit, Palm Kernel Oil, 

Anhydrous, Butter Oil (Ghee) and Sugar etc. 

Milk Vita: 

Milk Vita is one of the most famous brand names in Bangladesh for its liquid dairy milk. Owned by 

Bangladesh Milk Producers’ Co-operative Union Limited (BMPCUL), the company came in the market 

with proper dairy milk ice cream in form of cups and choc-bar. With a production capacity of around 

1600 litres per day, the company is trailing in the market place with 3% market share. 

Although the Milk Vita Choc-bar was perceived to be extremely tasty by consumers, they probably 

could not do well due price competition. Currently they do not even distribute ice cream in Dhaka. 

However, their presence is seen in outskirts of Dhaka and other nearby towns. 

If the current market situation prevails, Milk Vita would lose their remaining market share and other 

companies would benefit, especially Igloo. However, one of the advantages of Milk Vita remains to be 


their nation wide milk supply network. They have skimmed milk powder production plant that Igloo 

does not have. Thus, they can combat the seasonality of milk supply that Igloo with its huge 

requirement of milk cannot. 

Strengths and Weaknesses of Competitors: 

Company Strengths Weaknesses 

Igloo 

Kwality 

Polar 

Savoy 

Milk Vita 

� Strong brand image 

� High product quality 

� Highest no. of variety 

� Strong distribution network 

� Highest visibility 

� Strong promotion 

� High production capacity 

� Presence of extrusion ice cream 

� Product variety 

� Strong promotion 

� Free freezer distributed 

� Presence in all price segments 

� High production capacity 

� Free freezer 

� Quality perceived to be high 

compared to Kwality 

� Items are generally a bit pricy 

� Igloo does not give free freezers like 

other companies. 

� Reluctant in recent times regarding 

innovation 

� Local sourcing of liquid milk does not 

meet demand 

� Failure to use ERP technology, 

slowing decision making 

� Weak distribution 

� Lower exposure 

� low amount of carts in operation 

� Discoloured freezers 

� Lower exposure 

� Low product variety 

� Unused capacity 

� Price is lower � Discoloured freezers 

� Low product variety 

� Weak distribution 

� Small amount of freezers 

� Low production capacity 

� Quality is good due to dairy cream 

� Brand leverage from Milk Vita milk 

Table 21: Strengths and Weaknesses of Competition 

5.1.2 Market Characteristics of the Boutique Segment: 

� Low exposure 

� Low variety 

With a small market of BDT 9.8 Cr and 5.67% share in the branded ice cream market, the boutique 

segment is currently an increasing segment in the ice cream industry. Boutique segment’s history 

dates back to 1960s when Igloo launched boutiques in Dhaka to save distribution cost and promote a 

culture of “ice cream eating out”. In later years, boutiques lost their glamour and retail common format 

segment picked up growth. However, with Dolce Vita in the late ‘80s, craze for Italian Artisan ice 

cream was recreated in the market. Although Dolce Vita is failing in recent times, emergence of 

MövenPick and Club Gelato in 2000 has uplifted the segment once again. Current growth rate of the 


segment can be estimated to be approx. 20-22% (higher than the common format segment). 

Following are the basic detail of all the major players in the segment with their estimated sales 3 . 

A. Detail of Operation: 

Players Outlet # 

Sales 

(Cr Taka) Share 

Club Gelato 1 1.36 19.9% 

MövenPick 1 1.19 17.4% 

Andersen’s 3 1.19 17.4% 

Gelateria Igloo 3 1.19 17.4% 

Sub Zero (Kwality) 2 0.51 7.5% 

Baskin Robbins 1 0.15 2.2% 

Dolce Vita 1 0.17 2.5% 

American Soft 1 0.09 1.2% 

Rainbow 1 0.09 1.2% 

Others (off site) 0.89 13.0% 

Total Market 6.82 

Table 22: Players and Shares in Boutique Segment 

General operational procedure followed by all the operators is as follows: 

� Operating method: There is a variation in operational method among the large operators. 

� Club Gelato uses kitchen at own premise where imported ingredients and local milk (daily 

special service from Milk Vita) are used to make ice cream. 

� MövenPick directly imports ice cream from Switzerland. 

� Andersen’s, Gelateria Igloo and Sub Zero produce ice cream at their factory with a mix of 

imported and local ingredients. 

� Products: Around 30-35 flavours of artisan dairy ice cream are served at the premises. 

� Most sold flavours are Vanilla, Ferrero Rocher, Butterscotch, Chocolate, Caramel etc 

� Other Products: Larger players also serve ice cream desserts (milk shakes, ice cappuccino etc), 

pastries and other desserts with normal coffee and tea facility at their premises. 

� Boutiques fight ice cream seasonality with the other products sales during off-peak ice cream 

seasons. Usually ice cream and other products contribute at 60:40 ratio in summer and during 

winter and off-peak seasons the ratio reverses. 

� Pricing: Usually the prices of products in this segment are 3-4 times higher than that of the 

common format segment. 

� Prices do not vary with flavours. Variation depends on serve style (Cone/ tub) and use of 

toppings and other ingredients (Chocolate sauce/ nut/ fruits) etc. 

� Usual margin charged is around 50-60% over production cost. Similar margin is charged for 

other products like coffee, ice cappuccino etc. 

3 Yearly sales is estimated based on company’s approximate daily sales collected during interview 


� Target Group: Most of the consumers belong to SEC A and higher SEC A with DMFI of at least 

BDT 20,000. 

� Foreign delegates and resident foreigners also visit these boutiques. 

� Main purposes of visits in the boutiques are: 

• Youth: hangout with friends and having ice cream and ice cream derivatives 

• Family: Family night out or eat out at a restaurant and then having dessert 

• Foreigners: Having dessert after dinner 

� Rush time at boutiques are: Afternoon 2-4 pm and at night 9-11 pm. 

� Offsite sales: Most of the large operators also sell offsite. They have small freezers for off-site. 

� Club Gelato and MövenPick serves ice cream at high society parties and programmes. 

� MövenPick also has kiosks in known hotels like Sheraton. 

� Promotion: No mass promotion is done by any of the companies. Word of mouth is the most 

important source of promotion. Posters and banners outside the premise and occasional 

newspaper advertisements are used to communicate special offers. 

� Growth Drivers: Market growth is driven by image, innovation, quality, decoration of facility, 

environment and special offers. 

� Club Gelato has the image of selling true Italian dairy ice cream with an excellent hangout 

environment. 

� MövenPick imports ice cream directly from Switzerland and is perceived to be of high quality. 

� Andersen’s operates with the image of ice cream from Denmark 

� Gelateria Igloo (from Igloo) and Sub Zero (from Kwality) could not establish the premium 

artisan ice cream image. 

B. Players in the Boutique Segment: 

There are very few players who have significant impact in the boutique segment. Detailed information 

of all the major boutique segment players is provided below. 


Club Gelato: 

Basic Company Information 

� Location: Banani, Road# 11 (Planning for a second one in Dhanmondi) 

� Established in: 2001 

� Seating Capacity: 48 

� Area: 1250 sft (including kitchen) 

� Owner: Mr. Jahangir Alam (Bangladesh) 

� Business Type: Joint business partnership with Singapore 

� Staff: 15 people (6 in the kitchen) 

� Production capacity: 150 litres per day 

Product Related Information 

� Product: Italian style parlour scoop ice cream, fruit juice, coffee and pastries 

� Flavours: Around 32 flavours available 

� Most selling: Ferraro Rocher, Vanilla, Pistachio 

� Innovations: New variants and ingredients are communicated by their Italian supplier and Club 

Gelato decides what to take from them. 

� Serve type: Cup, Cone, Glasses, Box for take away 

Consumer Profile 

� Primary: Teenagers and Young Adults (18-30) & Diplomats 

� Secondary: Family consumers for eat out 

� Income Group: High income customers; tentatively from SEC A and higher SEC A 

� Geographic Area: Diversified 

� Rush time: 8-10 pm 

Sales and Price Information 

� Sales: BDT 50,000 (60% Ice cream, 40% other desserts) daily in summer. In winter however, other 

products sell more and thus they keep total sales at the same level. 

� Price: 750 per litre for any flavour. 

� Sales Volume: 50-60 litres per day 

Supply Chain/ Placement Information 

� Milk: Local sourcing from Milk Vita (40/50 litres per day) 

� Chocolates & Flavours: Belgium, France, Germany 

� Transportation: Mainly air (They can afford it due to high margin) 

� Contribution of various materials: Flavours (30%), Milk (20%), other parts are water and air 

Promotional Materials 

� Materials used are near premises POS materials for promoting the parlour only. 

Table 23: Detail of Club Gelato 


MövenPick of Switzerland: 


� Location: Gulshan 



� Owner: Mr. Arif Mahmud 

� Business Type: Franchise of International MövenPick 

� Storage Capacity in Shop: 150 litres 


� Product: Imported MövenPick ice creams, coffee, chicken sandwich and Frappe 

� Flavours: Around 30 to 35 flavours available 

� Most selling: Swiss Chocolate, caramel, Vanilla Dream, Espresso, Strawberry 

� Innovations: New variants are communicated by their franchiser and they decide on flavours that 

they want. 



� Primary: Teenagers and Young Adults (18-30) (70%) & Diplomats 


� Income Group: High income customers; tentatively from SEC A 

� Geographic Area: Concentrated in Gulshan and nearby areas. 

� Rush time: Afternoon- Young Adult, 10 to 11 pm Foreigners 

� *the company also serves at parties and has freezers in known hotels where their ice creams are 

served. 


� Sales: BDT 35-40,000 daily in summer. 




� Transportation: Imported finished goods by ship. 

� Ship travel time: 19 days 

� Port clearance: 10 days 

� Safety Cushion: Extra 10 days 



Table 24: Detail of MövenPick of Switzerland 


Andersen’s of Denmark: 


� Location: Gulshan, (2 others in Uttara, Dhanmondi) 



� Owner: United Group 

� Business Type: Franchise of Australian company Andersen’s of Denmark 

� Production: Tongi Factory of United Group 

� Production capacity: 2000 litres per day in factory 

� Storage Capacity in Shop: 150 litres 


� Product: Danish parlour scoop ice cream, and coffee 

� Flavours: Around 30 to 35 flavours available 

� Most selling: Strawberry, Butter Scotch, Green 

� Innovations: New variants and ingredients are communicated by their franchiser and they decide 

on flavours that they want. 



� Primary: Teenagers and Young Adults (18-30) (70%) & Diplomats 


� Income Group: High income customers; tentatively from SEC A 

� Geographic Area: Concentrated in Gulshan and nearby areas. 

� Rush time: 8 to 10 pm 


� Sales: BDT 10-12,000 daily in summer. 




� Milk: 20/25 kg packs are imported 

� Chocolates & Flavours: Imported 

� Butte paper: Local sourcing 

� Transportation: Ship 



Table 25: Detail of Andersen’s of Denmark 


Gelateria Igloo: 


� Location: Banani, Kemal Ataturk Avenue (Two others in GEC Mor, Chittagong and Naya Paltan) 



� Production: From Igloo factory in Shyampur, Narayanganj 


� Product: Parlour scoop ice cream and coffee only 

� Flavours: Around 30 flavours available 

� Most selling: Vanilla, Strawberry, Chocolate, Pistachio, Butter Scotch, Tutti Fruity 



� Primary: Teenagers and Young Adults (18-30) 


� Income Group: High income customers; tentatively from SEC A and B 

� Geographic Area: Diversified 

� Rush Time: afternoon and evening 


� Sales: BDT 8,000 to 10,000 daily in summer. Nearly one fourth in winter. 

� Price: Varies but 350 per litre of vanilla 

� POS materials at the premises. 


Table 26: Detail of Gelateria Igloo 

5.2 Price Comparison of Common and Boutique Segments: 

Price ranges of both common format and boutique segment cannot exactly be pin pointed as products 

do not follow common structure and variations occur with use of toppings, mixing of flavours and use 

of coatings. However, a price comparison has been made among the brands based on their price of 

per litre of vanilla flavoured ice cream in the market. It appears to be as following: 

Company Price/ Litre Vanilla 

Club Gelato 750 

MövenPick 640 

Andersen’s 460 

Dolce Vita 440 

Igloo 100 

Kwality 100 

Polar 100 

Milk-Vita 90 

Savoy 85 

Table 27: Comparative Price Analysis 

As it can be seen, there is price gap within the range of BDT 100-400. Ice cream kiosks and small 

scooping boutiques can operate within that range. 


6.1 Target Group of Ice cream 

6.0 CONSUMER ANALYSIS 

Who are the consumers of ice cream? This question does not have a clear answer. Ice cream is a 

food for all. It is the only food consumed by a human being at less than 0 degree centigrade 

temperature and people of all ages feel indulged to have it. However, we can determine focus target 

groups for both branded common format and artisan boutique ice cream. Group discussions and 

market visits were done to get insight into the consumers along side resources form secondary 

sources. Age based target group is common for both segments but variation among the groups occur 

mainly based on SEC and DMFI classification. 

6.1.1 Geographic Group: 

Branded ice cream remains an urban product till date. Geographically branded ice cream has reached 

urban and semi urban areas up to Thana Head Quarter levels. Ice cream has reached areas where 

electricity is available. Small artisan players are available in places where large branded players have 

no distribution. 

6.1.2 Target Age Group: 

Age wise grouping of target consumers is as follows: 

� Urban kids in the age group of 5-14 

� They mainly consume normal sticks, cups, cones innovative fillers and water ice creams. 

� Urban youth in the age group of 15-24 

� They consume premium and extrusion sticks and cones. 

� Urban mothers in the age group of 25-35 

� They determine the family purchases. Even when the father purchases ice cream, decision is 

taken by them. 

Consumption pattern of various age groups are depicted in the following chart. 

Ice cream consumption pattern 

20% 

50% 

30% 

05 to 14 yrs 15 to 24 yrs 25 to 35 yrs 

Figure 11: Target Group wise Consumption Pattern 


6.1.3 Target SEC and DMFI Group: 

Common Format: 

SEC A and B is the target group for common format ice cream. However, with rapid increase in price 

level over the years, has made it a “hard to consume” product for SEC B consumers who belong to 

lower DMFI group. 

Boutique Format: 

Boutique format’s higher margin and high price range makes it an exclusively SEC A ice cream. 

People belonging to upper and upper middle class have access to the mediocre boutiques and only 

higher upper class can have premium ice creams like Club Gelato and MövenPick. 

Another unique target group for boutique format are the foreigners who live in Bangladesh. These 

people tend to visit the parlours to have ice cream as dessert especially after dinner. 

6.2 Ice cream in Consumer Lifestyle 

Context 

� Fun & Excitement 

� Social Togetherness 

� Indulgence 

� Affection for children 

� Boredom relief 

� Pacifier/ Reward 

When 

� Post Dinner 

� School Time 

� Summers 

Ice Cream is 

best 

enjoyed in 

shared company 

Figure 12: Ice cream in Consumer Life style 

Social Setting 

� Friends 

� Family 

� Companion/ Spouse 

� Guests 

Where 

� Treat / Celebration 

� Holidays 

� Hangout 

This simple overview of ice cream in consumer lifestyle was determined based on in-depth research 

analysis of UBL and validated through qualitative group discussions by the author. However, detail of 

in-depth research is provided in a later section of this chapter. 


6.3 Highlights of Purchase Habit of Ice cream 

6.3.1 Common Habits across Target Groups: 

There are some common habits that were identified in earlier researches and group discussions with 

consumers. Common habits mean the consumer approach towards ice cream that is seen across all 

target groups e.g. kids, youth and adult purchasers. These are outlined below. 

� Ice cream is mainly seen as a dessert or a snack. Impulse ice cream is seen as a quick snack 

that is consumed when it is in sight. Visibility plays a big role here. Regarding family packs, 

people see it as a post-food dessert. 

� Ice cream purchase is commonly a planned event. When the contexts arise, people generally 

take a bit of time to decide whether or not to have ice cream or when they want to go to a 

boutique they make due considerations regarding which boutique to visit. 

� Ice cream purchase decision is taken based on favourite flavour. People tend to try out new 

variants and flavours when they first see it. They compare the taste with earlier experience and 

when they purchase later they choose the flavour they have liked most. 

� For In-Home segment decision is mostly taken on the flavour. Generally people come up with 

different flavours of choice and most voted flavour is chosen. 

� People become aware of new variants or flavours mainly through word-of-mouth. Advertisement 

(new launches, special offers and festivals) in newspaper is another source of awareness. 

� People are currently indifferent towards the price level of premium flavours. However, some feel 

that price of Choc-bar, or water ice creams (lolly) is a bit much. If less, they would have consumed 

more. Some also feel that companies should come up with branded ice cream in the price range 

of BDT 5-8. 

� Ice cream is purchased from nearby shops. If required brand and flavour is not available, 2-3 

shops will be visited and then available flavour will be selected even if the required one is not 

found. This is done mainly not to ruin the mood for ice cream. 

� People are very open to try new brands and flavours especially if it comes from a credible source. 

They would try new flavours and if they are satisfied with the taste, they would repeat purchase. 

� Regarding boutique visits, people feel that boutiques need to have a proper environment, enough 

flavours and other snacks. 

� While visiting boutique with family or companion, they want variation in flavours, so that they 

would order different flavours and taste each other’s ice cream. It is seen as a sign of 

togetherness. 

� Frequency of ice cream purchase varies among people. It depends on peer pressure, collective 

family decision, summer heat and attitude towards “ice cream” itself as a product. 


6.3.2 Habits of Kids: 

� Kids choose ice cream flavours by the look of the product (generally pictures shown in POS 

materials and carts). They love colour and designs of the products let it be a common format or a 

boutique ice cream. 

� Kids (when in house) would go with the housemaid to the nearby shop, choose the flavour they 

want (within range of the amount given to the maid) and buy it. 

� When with parents, they would take the product they like even if the price is lower than some 

other product. However, mothers play a role in this decision. They would want their children not to 

choose too high priced a product or coloured products. 

6.3.3 Habits of Youth: 

� Young people are the main consumer of impulse ice cream. They also are one of the major 

consumers in the boutique segment. 

� Young people love to try out new products that come into the market. Another side of the coin is 

that, they are not very loyal to a brand or a flavour and tend to switch a lot. 

� Regarding boutique visits, young people go to boutiques to have an “ice cream hang out” with 

peer groups. They would stay there for a longer period of time while they have their ice cream. 

� Some times young people make milk shakes and other ice cream based desserts. 

6.3.4 Habits of Mothers: 

� Mothers worry about their children’s health and they prefer “vanilla” type of brands. However, 

when price constraint occurs, they go for water ice creams for their children. They try to convince 

their kid’s purchase decision. 

� Regarding family purchase, mother’s decision is sometimes prioritized by the whole family. 

6.4 Barriers to Ice cream Consumption 

6.4.1 Emotional Barriers: 

� Overindulge (close to sinful) 

� Undisciplined (no control) 

� Childish (licking) 

� Artificial Image 

6.4.2 Functional Barriers: 

� People of SEC B feel that ice cream is an expensive dessert (If less expensive would consume 

more often). 

� It leads to cold / cough - especially in winter / rainy season. 

� It contains artificial additives / preservatives 

� It is very high in calories that lead to fattening. 


� It does not quench “thirst”. 

� Less convenient (portable, immediate eat) 

� Messy / Dripping 

6.5 Research Findings 

The highlights regarding purchase habits, triggers and barriers of ice cream consumption provide a 

glimpse into the consumer world of ice cream industry. However, UBL CMI conducted a formal 

research exclusively on ice cream consumers to identify: 

� Occasions of ice cream 

� Frequency of ice cream consumption 

� Expectations from ice cream occasions 

� Personalities that they desire from ice cream 

6.5.1 Relevant Occasions in Daily Lives of Consumers: 

Research question regarding “usual occasions of life that occurred most frequently in day-to- 

day lives of the respondents” generated the following replies. 

Occasion 

% of Respondents 

saying "Yes" 

Watching TV 93 

Normal Dinner At Home 91 

Normal Lunch At Home 89 

At Home, While Reading/Music/Surfing 86 

Informal Family Get Together 85 

Out Of Home, Hanging Out With Friends 84 

Out Shopping 84 

Mid-Afternoon Break At Home 83 

At Home By Myself During The Day 82 

Special Dinner At Home 82 

Informal Dinner Out Of Home 82 

Normal Lunch Out Of Home 82 

Leisure Walk 79 

Coming Home From Work/School 78 

Special Dinner Out Of Home 78 

Celebration 78 

A Night In With Friends 77 

At Home By Myself In The Evening 77 

Special Lunch Out Of Home 76 

Mid-Afternoon Break Out Of Home 75 

Special Lunch At Home 73 

Day out with Partner 72 

Midmorning Break 70 

At Breakfast 68 

Family Day Out 68 

During Work Or At School 65 


Travelling To/From Work/School 65 

At The Cinema 61 

Special Event 56 

Clubbing/ At A Party 50 

Post Gym/Sports 48 

Table 28: Relevant Occasions in Consumers’ Lives 

Respondents were then asked to mention “frequency of occurrence of the identified occasions”. 

The identified replies are as follows: 

Post gym/sports 

Special event 

Family day out 

Special lunch out of home 

Special dinner at home 

A night in w ith friends 

Mid-afternoon break out of home 

Leisure w alk 

Out of home, hanging out w ith friends 

Mid-afternoon break at home 

Day out w ith Partner/ Spouse 

Traveling to/from w ork/school 

Coming home from w ork/school 

normal lunch at home 

Normal dinner at home 

Daily 2-3 Times A Week Weekly 2-3 Times A Month 

Once A Month Every 2-3 Months Less Often Never 

Figure 13: Frequency of Occurrence of Occasions 

This shows that “Normal dinner at home, Watching TV, Normal Lunch At Home, At Home, While 

Reading/Music/Surfing, Coming Home From Work/School, During Work Or At School, 

Travelling To/From Work/School, Midmorning Break, Day Out With Partner/ Spouse, At Home 

By Myself During The Day” are the most frequent daily rituals of busy lives of consumers. 

6.5.2 Frequency of Ice cream Consumption: 

Respondents were asked to mention “consumption pattern of ice cream during the identified 

occasion” on a scale of 1-5 depicting frequencies like “(5) always, (4) most of the times, (3) about 

half of the times, (2) sometimes, (1) never/ do not know”. The responses are depicted in the 

following table. 


50 48 43 41 39 37 

48 30 30 29 27 26 23 27 25 22 20 20 20 19 20 

26 

22 17 13 17 

22 22 

34 37 

40 37 41 39 40 46 38 39 44 46 47 46 45 37 45 41 46 41 37 

46 38 

4 4 4 4 7 4 5 4 4 6 5 5 5 5 5 5 6 6 7 5 6 6 6 5 7 7 5 9 

6 7 7 7 9 9 9 10 11 10 10 16 

11 11 10 12 10 11 11 10 10 11 13 11 14 13 13 

12 14 

11 12 14 11 13 12 16 18 15 19 18 15 18 21 18 17 17 17 19 18 17 18 20 17 21 30 21 

22 

30 34 34 25 

Midmorning break 

While clubbing, at a 

At the cinema 

Special event 

Normal lunch out of 

A night in with friends 

Normal dinner at 

Informal dinner out of 

Always most of the times About half of the times Sometimes never/do not know 

At home by myself 

At home by myself in 

Figure 14: Frequency of Ice cream Consumption 

As it can be seen “Day out with Spouse, Special lunch at home, Special dinner at home, 

Watching TV, Family day out, Celebration” are the occasions where most frequently ice cream is 

consumed. 

6.5.3 Market Character: Mapping Relevant Occasions vs. Frequency of 

Consumption 

If we plot frequency of consumption on the X-axis of a chart and relevance of occasion occurrence on 

the Y-axis taking the above mentioned values as cut-off values we get four quadrants in the chart 

depicting four market scenarios that any ice cream manufacturer in Bangladesh market might 

encounter given the current market situation. This market segmentation is based on frequency of ice 

cream consumption in daily occasions of consumer lives. 

The segments are: 

� OPPORTUNITY MARKET: High Relevant Occasions-Low Ice cream Frequency 

� QUESTION MARKET: Less Relevant Occasions-Low Ice cream Frequency 

� HIGH FREQUENCY MARKET: Relevant Occasions-High Ice cream Frequency 

� CAPTIVE MARKET: Less Relevant Occasions-High Ice cream Frequency 

The chart looks as follows: 


Out shopping 

Special lunch at 

Day out with Spouse 

Watching TV

Figure 15: Relevance of Occasion-Frequency of Consumption Mapping 

As it can be seen from the above chart, Bangladesh Market still lies in the Opportunity and Question 

market zone with a pull towards High frequency and Captive Market zones. This is evident from 

market data as penetration of ice cream still remains at Thana headquarters levels. Also, this explains 

the high market growth rate of 17% as market is yet under developed and branded quality ice cream 

has yet not reached all levels of consumers, especially rural level that constitutes around 75% of 

Bangladeshi market. 

From the above analysis, we can establish that target of ice cream manufacturers should be to 

penetrate more into the Bangladeshi market to create higher frequency of ice cream consumption. 

The following chart shows the strategies to follow for ice cream manufacturers. 

Figure 16: Required Market Strategy for Bangladesh 


As, relevance of ice cream consumption occasions can hardly be controlled by marketers, their 

endeavour should be to create more “emotional and functional” attachment to ice cream in less 

frequent occasions through “market development” strategy to earn share from overall food 

expenditure of consumers and at the same time make them consume more ice cream in highly 

relevant occasions through “penetration” strategy. 

6.5.4 Consumers’ Emotional Requirements and Product Attributes: 

All consumers under these clusters also identify the emotional requirements and the significant 

product attributes they seek from their current preferred and future desired ice creams. These are 

provided below. 

Cluster 

Emotional/ Functional 

Requirement Product Attributes 

Enjoyment Flavour/ Variety � Combination of different flavours 

� Combination of different textures 

� Very sweet 

� With wafer or biscuit 

� With chocolate 

� Of a well known brand 

Socially Involved Spoonable/ Rich � Very creamy 

� Only natural ingredients 

� No mess 

Care Size/ Creaminess � Big 

� Rich, full taste 

� Smooth 

� Value for money 

� No mess 

Unwind & Escape Economy � Crunchy 

� Economic 


� Nutritious 

Balanced Convenience Health Conscious � Of a well known brand 


� Milk based 

� Low sugar 

� Low carbohydrates 

� Filling 

Active Self-Grooming Fruit/ Vitamins � Healthy 

� Fruit based 

� Low fat 

� Liquid or drinkable 



Confidence Drinkable/ Light � Low calories 

� Light on the stomach 

� Chewy or gooey 

� Not so sweet 

� Natural appearance 

Sensual Appeal or image � No artificial additives 


� Natural appearance 

� Melting slowly 

� Attractive packaging 

� High quality ingredients 


Table 29: Requirements & Product Attributes Desired by Consumer Clusters 

Of these findings we see that the identified highlighted barriers to ice cream consumption are pretty 

evident among the consumers. Mostly people want products of a reliable source or a well known 

brand, low calories, quality ingredients, value for money/ economic type. 


7.0 INDUSTRY ATTRACTIVENESS AND ENTRY PROSPECTS 

7.1 Driving Forces of Growth 

As identified in the earlier sections, there are several driving forces behind the growth of ice-cream 

industry in Bangladesh. 

7.1.2 Trade and Infrastructural Level: 

� As a result of globalization newer varieties have been introduced to the local products. Many 

foreign companies are also coming as franchise so there has been increased competition and 

these boutiques are setting higher standards for the local producers. 

� The present market growth rate is 18-19% which is being influenced by larger players like Igloo 

who are expanding their distribution nation wide with expansion of national electricity grid. 

� With entry of Modern Trade and recent organized business approach of retailers has made it 

possible for ice cream manufacturers to penetrate into shops even without providing them with 

branded freezers. 

� Weather change has increased “summer” season in our country, which has reduced negative 

seasonal impact on ice cream. 

� Large companies like Igloo have taken global learning of using carts as an effective tool of 

availability and visibility for ice cream. 

� New and improved technologies are being used in the production process. This technological 

advancement has improved quality, increased speed of production and made the process more 

cost effective. 

7.1.3 Consumer Level: 

� Only a few years back rich people could afford the luxury of having ice-cream but now it has 

become a common product for everybody. Ice-cream companies are producing different products 

with a wide price range for consumers of every class and status. 

� Nowadays companies are doing promotional campaigns more frequently; the customers get to 

know about the product which makes it easier for them to buy the best one. 

� The improved standard of life and more modernized lifestyle of people is an important reason for 

the increased consumption thus growth of the ice-cream industry. 


7.2 Prospects of Entry 

The ice-cream industry of Bangladesh is an attractive one for the investors because there is a huge 

market but number of producers is very small. The major reasons behind industry attractiveness are 

as follows: 

� The industry’s current growth potential is very high with opportunity for market development. 

� The competition currently permits adequate profitability and the competitive forces are becoming 

stronger with time. 

� Boutique segment is at a very high growth stage but no operator is currently operating with a mid 

price range of BDT 100-400. Ice cream kiosks and small scooping boutiques can operate within 

that range. 

� Current industry driving forces are favourable for the future industry profitability. 

� Globally oriented consumers look for variety in ice cream that is currently not available. Latest 

innovations came in the market in 2002. People would welcome new variety and flavours. 

� There is a gap in the market for balanced convenience through ice cream where consumers can 

get nutritional benefits for ice cream. Also, emotional attachment to ice cream could further be 

improvised in promotional campaigns. 

� There is high scope for market penetration and development to increase frequency of ice cream 

consumption. 

� Level of risk or uncertainty is very low in ice-cream industry because the consumer market is so 

huge, any product with a standard quality and careful pricing will be able to make significant profit. 

� As for geographic reach of the industry, 60% market is still in Dhaka. There is scope of expansion 

and a new entrant can easily capture market share within Dhaka using carts even if they do not 

want nation wide cold chain distribution. 

� The production process is very complex and capital requirements are also high. So before going 

into production any company should know about their capabilities and weaknesses and then start 

the business or else they might suffer huge loss at a certain level. 

� Unilever can acquire the required resource and use existing multi-national multi-cultural expertise 

to enter the market in a grand way. 

� With high probability of entry from DANONE with more products like the ISIS diabetic ice cream, 

Unilever should consider entering in this industry as soon as possible. 


8.0 ENTRY STRATEGY FOR UNILEVER 

While describing the suggested entry strategy for UBL, certain issues have been kept confidential and 

some issues have been touched but not explained to keep consistency with UBL confidentiality policy. 

8.1 Suggested Entry Areas for UBL 

� Boutique segment of the Bangladesh ice cream is only 5% of the branded market. UBL needs to 

pursue a larger scope to make the entry viable. 

� UBL cannot fight with unbranded segment as global product quality mandate of Unilever does not 

allow UBL to fight in low price-low quality segment. 

� Recommend entry should be in the common format segment with both single and multiple 

servings and in the boutique segment with a different brand name (if possible BEN & JERRY’S). 

� UBL should build up state-of-art modern factory for manufacturing and establish cold chain 

facilities initially focusing on metro cities. 

� Investment issues are required to be addressed for building factory and cold chain and capital 

requirement needs to be identified for that purpose 4 . 

� UBL may have boutiques for driving image/ selective top-end offering. 

� Kiosks can be setup near universities and shopping malls. 

� Boutiques should be concentrated in Dhaka and Chittagong. 

� Ice cream for boutiques and kiosks would be produced in factory as institutional packs of 9-10 

litres. 

8.2 Products 

� As a Brand Building country in global Unilever operating framework UBL is entitled only to bring 

products developed by the Brand Development countries. 

� Unilever should focus on serving products that have nutritional benefits (already available 

globally) along with usual satisfactions of sensual pleasure, functional attributes etc. 

� Current existent players especially Igloo and Kwality have extensively copied global and 

regionally available Unilever products e.g. Cornelli is same as Wall’s Cornetto, Vinetta is similar to 

Vienetta, Mega is similar to Magnum etc. UBL needs to differentiate these to consumers on the 

“taste the original” platform where global quality is focused regarding the products. 

� UBL should also bring regionally famous brands like Moo or Max to create image differentiation. 

� Magnum or Moo should be used as premium end ice cream to generate more profit margin. 


8.3 Placement 

� Distribution focus should be in Dhaka for entry as Dhaka contributes more than 60% of total ice 

cream sales in the country. 

� Company may use carts as distribution method. They serve as good source of visibility and 

availability. It would help in increasing impulse purchase. 

� At least 1500 outlets in Dhaka and Chittagong needs to be actively served using dedicated 

branded refrigerators to generate sales. 

� 50 carts should operate in Dhaka and Chittagong. 

8.4 Price 

� UBL products should be priced at par with Igloo pricing for the common format ice creams. 

� UBL can bring in premium single-serve SKUS for the higher economic classes in the price 

range of BDT 60-80. 

� Smaller SKUs (small lolly stick) can be introduced in the price range of BDT 10-15. 

� In the boutique segment UBL should price products above the semi-premium segment (Gelateria 

Igloo, Sub Zero or Andersen’s) but lower than that of Club Gelato or MövenPick. 

8.5 Promotion 

� UBL would require strong marketing campaign (As high as 50% of sales) to have a grand entry in 

the market. 

� Presence in the television media would be of utmost importance. More than 50% of 

promotional expense should be made here initially. Gradually it can be reduced. 

� Newspaper would serve as the second most important option. 

� Billboards should also be used. 

� Activations (similar to Lux Channel i Super Star or Igloo Festival) should be done to generate 

trial. 

8.6 Scope of Opportunity 

Value Volume 

(BDT Cr) (Tons) 

Market 131 7835 

Common 121 7600 

Boutique 9.8 235 

Table 30: Value and Volume Based Scope of Opportunity for UBL 


8.6.1 Geographic Contribution: 

� Dhaka (61%) 

� Chittagong (19%) 

� Sylhet (10%) 

8.6.2 UBL objectives: 

Common Format Ice Creams: 

� Target: 10% Market share in 1st year operation 

� Value: BDT 11 Cr 

� Production capacity required: 2.1 Tons/ day 

� Freezer Placement: 1500 freezers 

� Cart operation: At least 50 carts 

Boutiques: 

� Target: Further develop the market 

� Focus: Dhaka, Chittagong and Sylhet Metro 

� Franchise: At least 20 franchisee operations nation wide in divisional towns 

� Pricing: Below imported parlours; above common formats with around BDT 400 per Litre. 

8.7 Critical Success Factors 

� UBL is considered as a high profile company in Bangladesh and thus they cannot operate in the 

market only with common products like choc-bars and cups. They must have premium products 

(these require extrusion line) also to carry their brand image. Otherwise UBL would not be able to 

charge usual premium over competition products. 

� Launch of ice cream would require huge promotional and activation support in order to gain 

customers from Igloo. People want novelty regarding ice cream and UBL have to let them know 

about their products and create hype. 

� Cart should be used as a source of distribution. Recent successes of Unilever companies like 

Indonesia shows that carts can generate more sales and can be used as source of visibility in the 

minds of both retail traders and consumers. Carts can also provide incremental sales to the 

company. 

� UBL have to create a strong cold chain for ice cream (initially in Dhaka and Chittagong) to ensure 

quality products for consumers. 

� UBL have to build capacity very rapidly to meet consumer demand if the launch is successful. 


9.1 Basic Assumptions 

9.0 BUSINESS PROJECTION 

Business projection for ice cream business was made based on a conservative approach. UBL would 

require spending significantly on production capacity and factory dedicated to ice cream. Thus, to 

analyse business possibilities of ice cream certain assumptions were made and collected data were 

used. These are: 

� Production equipments and cabinets would cost approximately BDT 55 crores. 

� Production equipments : 45% 

� Packaging Equipments : 15% 

� Storage Facility : 20% 

� Branded Freezers : 10% 

� Distribution Investment : 10% (Distributors would also invest themselves) 

� Ice cream factory with a floor size of 20000 sqft would cost BDT 25 crores. 

� Objective is to capture 10% market share in Dhaka and Chittagong in the first year. 

� Business would grow by 50% in year 2 and 3; 30% in year 4 and 25% in year 5. 

� Weighted price per litre is BDT 170 according to volume share of single serve ice cream, multiple 

serve ice cream and boutique ice cream. 

� Other financial assumptions were also made. List of them are provided below but amount has 

been removed for confidentiality issues. 

Assumptions 

Trade Margin 

Distributor's Margin 

Duty/VAT Rate 

Trade Terms Expense % of NPS 

Trade Terms Expense % of NSV 

Advertising &Promotion % of NPS 

Indirects (Salaries, Wages etc) % 

Trading Tax % 

Table 31: Assumptions for Business Projection 


10.0 CONCLUSION 

Ice cream has good prospect in Bangladesh. It is still a growing market with opportunities for big new 

entrants. With the barriers of entry, UBL needs to consider its priorities. UBL being an HPC company 

traditionally needs to acquire expertise in cold chain distribution and has to invest a lot of money to rip 

the benefits of the industry. However, to initiate company can take regional support and acquire 

resource expertise. The company should enter the business as soon as possible since there is 

potential threat from DANONE to introduce more ice creams after ISIS diabetic ice cream and also 

with potential of the industry arch rival Nestle’ might consider entering into the industry too. 


Web References: 

References 

1. www.unilever.com 

2. www.unilever.com.bd 

3. www.hll.com 

4. www.unilever.com.pk 

5. www.thedailystar.com - Life Style Magazine, 

6. www.reuters.co.uk

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