Case Study Fraser & Neave Holdings Bhd

Strategic Management (MGT657)

Examination: December 2013

Part A

F&N Looks to Unlock Landbank

1. Explain F&N strategies for its future plan (10m)

Fraser & Neave Holdings Bhd (F&N), a household name that has been in existence in Malaysia for more than a century. There are many strategies that F&N has come out for their future plan.

Firstly, F&N may unlock landbank for development in Johor Baru and Kajang, Selangor. In these projects, F&N believe that this move is a part of the group’s strategy to explore value enhancing initiatives for its existing land assets that are primed for development.

Besides that, F&N and Vacaron Co Sdn Bhd will team up with Singapore’s FCL Centrepoint to develop Jalan Kemajuan and Jalan Universiti in Petaling Jaya set to be transformed into a hub, with residential, retail office and hospitality properties.

Lastly, F&N has set up to develop commercial properties in Johor Baru.

2. Describe the collaboration of F&N and its partner and the potential benefits derived from such arrangement. (10m)

The joint venture between F&N and Vacaron Co Sdn Bhd in order to team up with Singapore’s FCL Centrepoint Pte Ltd will enable the group to maintain its focus on their core business which are food and beverages. Besides that, this collaboration does not require F&N to divert the resources with others. Furthermore, F&N be able to earn revenue from the property sales.

3. Suggest any two (2) marketing efforts to boost F&N My Cola Sales. (10m)

Increase advertising

Advertising works well when it tries to appeal to those values that drive consumer decision processes. Furthermore, F&N must enhancing the quality and reliability of information available to consumers. This involves ensuring the quality claims made by firms by promoting the development of guides, standards and codes by endorsing labelling requirements and by developing and implementing enforcement strategies.

Protect the quality of the product

Health claims help food marketers sell more of their brands at higher prices. Thus, introducing My Cola with less sugar and My Cola energy drink are the alternative way to market the products.

4. Besides what has been highlighted in the case study (e.g floods in Thailand), discuss another two (2) environmental forces that could impact a firm’s strategy. (10m)

 Air Pollution

Air pollution is one such form that refers to the contamination of the air, irrespective of indoors or outside. A physical, biological or chemical alteration to the air in the atmosphere can be termed as pollution. It occurs when any harmful gases, dust, smoke enters into the atmosphere and makes difficult for plant, animals and humans to survive as the air becomes dirty. For example, air pollution can reduce the productivity of individual workers. At the same time, environmental regulations are often considered to be a drag on the economy, as it can slow down production and lead to business closures and job losses, with resulting higher costs for consumers. Yet effective environmental regulations should be implement to improve the air quality. So workers are more likely to be healthier and more productive as a result. The extent to which these gains in worker productivity offset or even overcome the perceived negative effects of regulation is therefore an essential consideration for designing optimal environmental policy.