Itm 406 Ülker Bisküvi Case Study

[pic 1]

School of Management and

Administrative Sciences

ITM 406

Instructor: ANIL DİVARCI ÇAKMAKLI

Mustafa Çelikel 218191926

Mehmet Adayolu 214011064

Baran Altun 214201500

Abdul Sami Barakzai 214151511

    Ülker was found in 1944 by Sabri Ülker in Eminönü in İstanbul. Ülker is in the Fast-moving consumer goods sector from the beginning. The company sells only biscuits from its foundation to 1970. After 1970 Ülker started to produce products mainly products with chocolate, wafer, and chocolate. After 20 years Ülker also started to sell cake, milk, and oil. After 2000s Ülker produces almost any product for kitchens and also beverages. Ülker sells its products abroad since 1974 with biscuits. Ülker produces its products in Turkey till the late 1990s. At that time Ülker found and FMCG company in Saudi Arabia. The main purpose of Ülker by establishing a new company in Saudi Arabia is to reduce transportation costs and reach the whole Arabian peninsula easily. After that Ülker started to found new factories in Romania, Kazakhstan, Pakistan, and Egypt. Ülker’s export numbers grew swiftly. Ülker manages to survive in foreign countries with its brand and also produce some private labels for local companies. Nowadays Ülker reached more than 80 countries in 5 continent. But Ülker enters the new countries by not only establish factories but also with buying already existing companies such as United Biscuits. Ülker bought worlds 6th biggest biscuits producer with the acquisition. Again in same method Ülker also bought Godiva in 2007. Ülker generally uses organic expansion by using its own brand name and producing local private labels as like as in Turkey.

    As we all know the world is becoming a very small place. Especially for business. Every businessman dream is to have a worldwide known brand. But achieving it is not easy. Firstly, it’s not easy to be successful in your own city. If you succeed in it. The product you sell in your country might not work in other places. So for all these things we have to have a strategy when to enter a new market and how to enter it.  So we were talking about Ülker. Ülker is the largest chocolate and biscuits producers. And it also started to build manufacturing outside of the turkey, in the international market at the beginning of the 21st century. Now they have 6 factories in 6 different countries. Ülker is a very rich and big company. When they are entering a new market they are doing a survey about that country, about their culture. For whether they should bring changes to their product or not. So according to that survey, they are making their plane whether to enter. Or if we enter can it be beneficial and many more. Ülker continuous investment is based on a strategy that focus on both sustainable and profitable growth. Ülker is exporting to more than 100 countries, with 29300 employees. Buying famous brands is also one of their strategies. Ülker when they want to enter a new market they research it and buy a famous brand or company in that market. It has benefited in many ways. First, it’s already a well-known brand and they will not send money to make their brand famous. Also, they can change the things in that brand that people do not like in that brand. For example, Ülker bought Godiva. It’s a luxury chocolate brand. By buying this Ülker become one of the well-known company in the market. Ülker was known in Russia, Russia, and Asia. Now after this step of buying Godiva. They entered the eyes of Europe and America. America was one of those places which Ülker was not known. In short, Ülker is bringing changes in their products in some part of the world by doing a survey and according to the country culture. In some countries, they use the same product as they use in Turkey. And sometimes they buy the existing company. And bring some changes if necessary.    

       For competing in the new market generally difficult for companies. They need to discipline, powerful corporate culture and loyal customers to achieve it. Moreover, they should do something to compete for their rivals in the new market. To illustrate, they should identify their brand, they should be superior to their competitors in specific fields and they should know or measure customer and customers preferences. Ülker collected customer preferences before going into new countries. Ülker actively produces biscuits and chocolates in Saudi Arabia, Kazakhstan, Romania, Pakistan, and Egypt. These are the countries which Ülker actively produce something. On the other hand, Ülker exported more than 80 countries their products these days. This means they are very successful in competing in new regions. Because these countries are located in different parts of the worlds. So, Ülker competes for its rivals according to that rivals countries’ condition and different taste preference. Ülker applies their plans about expanding very well despite local laws, local competitors which are the first preference of society, and local tastes. These numbers about exporting countries and actively producing countries show us to Ülker continue its way successfully. According to them, the main motivation of the Ülker to globalize its activities are successful brand purchasing and high-profit margin. “Ülker's net profit for 2017 increased by 51.6 percent of the year to TL 431 million.” (CNNTURK, March 2018). And another example of it that: “Ülker Announces Historical Profit with TL 241.7 Million in the Second Quarter of 2018.” (ÜLKER, August 2018). These examples show us to high-profit mark- up is remarkable driving power with purchasing brands for Ülker. Taking everything into account, Ülker competes for its rivals in the new market place according to new rules. Ülker apply its plans successfully, and purchasing correct firms and high-profit rates are the essential motivation of the Ülker to globalize its activities and expanding carefully and successfully.