I.

Description of the company SA Covalact SA

1. Description of the business idea

The proposed business idea is to open a dairy products company in
Covasna, aimed at the general public. It has been found that a structure of this type exists in Covasna.
aa dar decizia de a crea un asemenea firme s-a dovedit a fi dinamic , atrag toare i
innovative.
Through the company S.C. Covalact S.A. has a portfolio of over 16 types of
produces and holds, according to its own estimates, a market share of 2%. The most important
Players in the dairy products market are Friesland, Danone, Hochland, LaDorna, and Albalact.
In the yogurt market, there are about 24 active brands at the regional or national level.
The company understands how to capitalize on all opportunities that arise for satisfaction, as much as
to a greater extent, of its clients, for improving the economic situation and the climate of
businesses and the markets it serves. In this regard, the company will take appropriate actions
to meet a higher level of its socio-economic responsibilities, so that
to serve the interests of customers, employees, and shareholders as well as possible. A primary direction
The action will be that of continuously improving manufacturing and sales technologies.
products.
In order to be more successful than your competitors, you must never...
we are content with a certain state of affairs; we will have to calculate the risk of seeking answers
innovative to the complex problems we face, bringing better solutions for
raising the standard of living in the markets we compete in.
The development of this business aims to meet the existing needs in this market, as
aceste zone prezinta un potential valoros de dezvoltare intrucat detin purtatori de cerere
numerous options to cover the needs of this local market entirely and at the best
inalte standard.
The mission is to identify the best market positioning for Covalact and to
create a distinct and consistent brand identity. 'As a starting point in this endeavor I have
it has two major advantages - the excellent quality of Covalact products and the impeccable reputation of
"the company." – Augustina Lungu, FireBrand Associate.
Business strategy: Based on the knowledge possessed and the type of services held, the business strategy
it will be one of differentiation compared to the competitive offer, both through the quality of the services provided, as well
and through their accessibility.
In order to be successful, both the promotion strategy and pricing must be implemented. These are
we stabilize based on what we can initially offer. If we offer exceptional conditions, we will
address of the top class (managers, accountants, IT engineers, engineers, doctors, teachers, etc.)
from a top neighborhood. If the investment does not allow us to offer top services, we will have to
we address ourselves to a segment that fits. This does not mean that we should compromise on
quality, but it may mean fewer services included (for example, in case if not
we have the resources to purchase a car, we will not provide the transportation service to
residence of the children.
In implementing a pricing policy, it should not be forgotten that a price too low for services
may create the impression of low-quality service. Also, a price that is too high must
sa corresponds of a service of quality.
Goals and objectives: those at Covalact have a new communication campaign aimed at
reposition the brand in consumers' minds, bringing them the authentic taste of
yogurt, from the producer. Purpose of the communication: persuasive advertising, trying to convince.
the consumers find no other yogurt better, healthier, richer, than the one from
Covalact.

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 The business aims to stand out as a brand exponent for this type of products.
oferite. Recunoasterea acestei pozitii se va face prin obtinerea intr-un interval de 3 ani o unei
slope of market of 20%.
To achieve its goals, the company will consider the following objectives:
• diversification of the product offer by approximately 20% improvement in quality;
improving the quality of products offered to customers and developing a stable network of clients
prin loyalty of these the first doi ani;
• obtaining one slope of market of 20% in the following3 Ani;
the recovery of the initial investment in the first 2 years of operation;
· increase in market share;
· achieving a turnover of over 30 million euros;
· aligning business activities with the new European Union regulations;
· the technological progress of the company and gaining a stable position in the dairy market;
· increasing market coverage and strengthening;
· position on the already conquered market;
· increasing the sales target for the milk and yogurt product segment;
· increasing the brand awareness of Cezar;
· improving the image of the Covalact brand product lines.
The quality of the products will be ensured and maintained through strict control.
management, the organization of periodic technical inspections by specialists in the field in
the oversight of compliance with safety standards. At the same time, workers will carry out periodic
medical visits and training courses and evaluation of professional competencies. Loyalty
Customers will be attracted by the superior quality of our services compared to those of others.
contestant.
2. Description of the company
Company Presentation
Date of identification of the economic agent
• Numele firmei : S.C. COVALACT S.A
• Sediul : Str. Lunca Oltului 1 Sfîntu Gheorghe, judetul Covasna, cod postal 4000, Tel:
067351861 , Fax : 067351058.
• Registration number at the Trade Registry: J14/76/1991
• Codul unic de inregistrare fiscala : 550152
• Type of activity, according to the CAEN classification: Manufacturing of dairy products and
of the brands.
S.C. COVALACT S.A. is a traditional company in the Romanian food industry
founded in 1969, being focused from the very beginning on milk collection and manufacturing of
dairy products, with a daily collection capacity of 200,000 liters.
Covalact is the most important on the Romanian dairy products market. Currently,
the company is owned by the American investment fund SigmaBleyzer Southeast European
The fund also owns the Lactate Harghita brand in Romania.
In 1990, based on Law 15, it was established as a joint-stock company with majority capital of
is registered at the Commercial Registry under the name of S.C. based on H.G. 1251/1990.
COVALACT S.A.
Starting in 1993, the company's management made the decision to take action in a very short time.
try privatizing the company through the MEBO method starting in November
1994, S.C. COVALACT S.A. is registered at the Trade Register under number 3283 as
private company with a subscribed and paid share capital of 1.529.4 million lei and a number of
119.569 nominal acres held by 417 shareholders. The resulting activity subject from
The founding documents refer to the collection, industrialization, and marketing of milk.
dairy products.

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 The company's management is currently developing a strategy for strengthening the company and
the transition to a new stage, primarily aimed at ensuring the quality of the products at
the level of European standards and norms. Financing of current activities is mainly ensured
from its own sources, but also from attracted sources such as bank loans and supplier credits. The profit
Reinvested profits have constituted the main source of financing for the company's development since its establishment.
up to the present has contributed to the formation of the technical-material base.
I mention that for several years through the investments made, the company has managed to
improve the quality of raw materials and extend the warranty period of its products
and thus managed to enter the markets in the neighboring counties and even in areas located
the mare distance cum ar
Bucharest, Constanta, Bacau, Ploiesti, Sibiu, Tg. Mures, Targoviste, as well as in the networks of
magazine Selgros, Cash&Carry, Carrefour Hypermarket, XXL Megadiscount (Rewe), Penny
Market, Trident, InterEx, Metro Cash & Carry, Bila, Cora Hypermarket, Artima, Plus Discount.
It is worth mentioning that there are products for which we are unique producers in Romania, such as Branzica.
from Frisca house for coffee - currently being suppliers of coffee cream Covalact for
Tarom, also for Jiulius Meinel Romania and Romania Prod (Agrana Group) under the brand
Covalact is also the first and so far the only company.
manufactured drinkable yogurt products from goat milk.
An important aspect is our partnership with the Dutch group.
Campina, a partnership through which our company has become the producer of the entire
yogurt assortments (plain or with fruit) and sour cream under the Campina brand for Romania.
The company has strengthened its position in the market over time through constant investments. Thus
Since 1994, a "HUGART" technological line has been purchased from Poland in
value of over 350,000 USD for the production of "homemade cheese" and Covalact Cream, a
complete technological line (UHT installation and BOSCH packaging machine) worth over
500,000 USD that 'Whipped Cream for Coffee' realizes uniquely in Romania.
These equipment have demonstrated their reliability and cost-effectiveness over the period.
for use by increasing production capacity and a quality level of finished products
superior.
In 2009, the company recorded a turnover of over 25 million Euros.
At the end of 2009, Covalact began an extensive rebranding process, which
marks the alignment of the image to the quality level of the product. Covalact from the Country translates
with natural, healthy, nutritious, and tasty dairy products.
In the period of 2010-2011, Covalact will continue its development plan and will invest
over 1.3 million euros in improving product quality, diversifying the portfolio,
as well as increasing production and logistics capacities. The company has invested over 1.5
millions of Euros for this purpose in the last two years. "Covalact understood that Romanians want to
Return to the true and healthy taste of the countryside, and our recipes respect the tradition of Transylvania.
Romanians desire quality products that are tasty and healthy, and Covalact de Tara is the brand.
"What all these things bring," said Zsolt Kovacs, Vice President of Covalact.
Covalact is the market leader in the cottage cheese segment with the brand 'Branzica of
"House" is in the top 10 producers for the rest of the dairy product categories through products under
the Covalact de Tara brand. The market is divided nationally by over 200
producers.
The collection activity of raw milk is carried out with its own forces from
Farms (former IAS) and private associations as well as from over 5000 producers
individuals from 5 counties. Milk suppliers are supported (for a fee) with feed, whey, etc.
ensuring milk cooling installations, milking machines, most of them being subsequently
purchased by milk producers.

3
 Presentation of the current situation
Regarding the market share, it can be estimated to be somewhere above 1.5% at the national level.
In certain areas of the country, the market price can reach, for example, -50% in Covasna County.
4% in Constanta; 7% in Bucharest. The company is in the process of implementing the system.
HACCP - the most recent measure in improving product quality by monitoring points.
critique of technological trends.
In 2009, the company recorded a turnover of over 25 million.
Euro. At the end of 2009, Covalact began an extensive rebranding process, which
marks the alignment of the image to the quality level of the product. Covalact de Tara translates to
for natural, healthy, nutritious, and tasty dairy products.
The company's objective is to fully satisfy customers and the reputation of Covalact.
the excellent quality of the products. The dairy producer Covalact from Sfantu-Gheorghe has
registered, in the first nine months, a turnover of about 13 million euros, an increase of over
12% compared to the same period last year. The company estimates it will close the year 2006 with
business of 16 million euros, an increase of 15% compared to the previous year. For 2007, the company
forecasting business over 18 million euros.
The dairy producer Covalact ended last year with a declining turnover.
Based on the results obtained in 2007, 'The turnover with which we closed the year 2008 was with'
between 8 and 10% lower than the results from 2007 due to a decrease in milk production
flour and butter by reducing the purchase of raw materials by up to 12%, and the profit was
correspondent
The financial crisis of 2009 is also significantly reflected in the performance dynamics of companies.
from the Top. Thus, their share in the county's turnover decreased in 2009 by almost
14% compared to 2008, and if this indicator is compared to the achievements of 2007, the decrease is
20%. The companies in the Top offered, in the reference year, 16,533 job positions, with 4,942 (23%)
less than the previous year.
Indicators from
the account of
profit yes 2005 2006 2007 2008 2009
loss of
COVALACT
Figure of
981.065 1,022,180 1,012,374 1.512.608 1.213.017
business
Total
1.027.925 1,211,305 1,064,670 1,561,543 1,267,065
income
Total
778.927 1,092,722 943.074 1,489,467 1,240,481
expenses
Gross profit 248.998 118.583 121.596 72.076 26.584
Net profit 209.201 98.299 102.775 60.236 16.498
Number
33 35 39 47 43
employees
According to CCI Covasna News, the mission of this major event is to
acknowledge and publicly recognize the merits of those with outstanding performances, to promote
competition and competence in business, good entrepreneurial practices. The achieved turnover
The companies in the Top, in the year 2009, amounted to 2.517 million RON (585 million EUR),
representing almost 55% of the turnover achieved in the county.
3. Product description
The company's product portfolio covers the entire range of dairy products, from yogurt,
["sour cream","fresh cheese","Fagaras cheese","drinking milk","kefir","whipped cream","cheese","butter"]

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powdered milk, butter, fermented cheeses (mature cheese), scalded cheeses (cheeses) until
to products that have innovated the market, such as those made from goat milk.
Ø Covalact sour cream 15% fat;
Ø Covalact Sana 3.6 percent fat 375g;
Ø Beaten milk from Covalact in a 900g pet.
Ingrediente: lapte de capra 50%, lapte degresat de vaca, culturi lactice selectionate.
Calorii: 47, Gr simi: 2, Carbohidra i: 3.8, Proteine: 3.4, Fibre: 0, Sodiu: 0;
Ø Covalact Branzica Casa 6% (200g)
Ø Covalact Natural Yogurt 2.8% Fat 375g;
Ø Covalact diet yogurt 0.1% fat 375g;
Ø Covalact one 65% fat 200g;
Ø Powdered milk Ingredients: sweeteners, acidifiers, preservatives, food flavors; fats
["vegetable","natural cocoa","citric acid"]
Ø Fagaras cheese 16% fat 200g;
Ø Sour cream 3.3% fat 100ml.
"Our best-selling products at the moment are Homemade Cheese and "
goat milk products, Covalact being the first company to launch products in this area.
categories. Another segment that has a very good evolution from our point of view is the one
the yogurts, where we will also expand the product range with fruit varieties in the fall.
similarly, recently, Covalact launched the products from the Sana and Kefir range under the brand
"own," added Mihai Neagu, Sales & Marketing Director, Covalact.
Due to the investments made in production capacities, it has been possible to obtain some products.
competitive, qualitative, and aesthetic, which ensures a market at the level of areas such as: Bucharest,
Constanta, Prahova, Dambovita, Brasov, Bacau, Valcea, Arges, Sibiu, through their own structures of
distribution. The potential offer of the company at the level of effective production capacities
(determine the technical condition of the equipment and the working regimen) correlated with raw materials
the following is available: drinking milk 45,000 hl/year; fresh products 60,000 hl/year;
branzeturi 7-800 tone/an; lapte praf 1400-1700 tone/an; unt 650-900 tone/an.
The quality of products made by S.C. COVALACT S.A. Sfantu Gheorghe was
confirmed by the awards won at the dairy products competition held within
SIMPOLACT 2002, the largest annual symposium and exhibition for the dairy industry from
Southeast Europe. Out of 13 products with which the company participated in the competition, 11 were
premium thus
PRIZE I: Sour cream, Buttermilk, yogurt, Cow's milk under 2.8% fat, Yogurt
cow milk with 2.8-4% fat, processed cheeses, sheep milk, fresh cow cheese
SECOND PRIZE: Yogurt with fruits, Pasteurized cow's milk under 2% fat, UHT milk over 2%
fat fresh of coffee) Cheeses frame of reference
milk cow
Award III: Sana
Description of services
For the creation of the Cezara and Cheile Cibului brands, Covalact turned to Brandient.
a company that provides its clients with integrated consulting services in marketing and branding,
creative services for verbal and visual identity, packaging design, brand communication,
internal branding services etc. Having the reputation of a team of experienced specialists
remarkable in management, marketing, design, and communication, Brandient is involved in
the creation or revitalization of important local brands.
To support and increase the company's activity, credit services were utilized.
supplied by the banks on the Romanian market and funds have also been contracted
Sapard (for financing the factory in Oidejdea that will be put into operation in the first part of
the year 2007).

5
 4. Location of the company S.C. Covalact S.A
Company [Link] S.A located at: Str. Lunca Oltului 1 Sfîntu Gheorghe, County
Covasna, being located near the intersection of Lunca Oltului and Nicolae streets
Balcescu, so that the location Saint George is located across from a central park
benefiting both from the proximity to the central park and from the attraction of the park's vegetation. Also having
as a workplace in Pitesti on Mircea Eliade Street 20 and Mioarei Street across from the hospital
Arges County.
Accesul la amplasament se poate face usor cu mijloace de transport in comun.(autobus sau
The future Saint George will be located on Oltului Street, near the
a central park, an easily accessible area filled with the attraction of vegetation.

[Link] of the environment in which the business operates

The business evolution environment can be characterized as relatively transparent.
predictable and which follows the trend of the national economy. The products manufactured have been and will be
always a permissive and permeable business, thus easy to imitate and open to competition
sustainable. As a consequence, the risk of bankruptcy is quite high. The year 2009 compared to the year
2008 (table no. 1)
In the previous year, in 2009, the production of goat milk collected by
The unit with processors decreased by 1.675 tons (0.2%). All processed dairy products have
registered creameries, the largest producing sour milk being 23,898 (25.9%).
The production of drinking milk also had an upward trend: from 159,464 tons
in the year 2008, to 191,335 tons in 2009, this meaning a 20% increase. in the year 2009 to
from 2008.
The significant levels of production were obtained in butter and sour cream for consumption.
of 1151 tone (17.5%), respectively 5434 (16%).
The production of cheese has evolved more slowly, the growth compared to the previous year being
only 2.8% (1846 tons), with a focus on the quantity of cheese produced exclusively from
Goat's milk accounts for 91.2% of the total cheese production.

Table No. 1. Collected goat milk and dairy product production

U.M YEAR 2008 YEAR 2009
Goat milk tone 1108696 1107021
collect yourself from the units
processors
The average content of % 3.65 3.67
fat
The environment content of % 3.20 3.21
projects
Dairy products obtained
Drinking milk tone 159464 191335
Cream for consumption tone 33940 39374
Yogurt tone 92331 116229
Unt tone 6563 7714
Total-cheeses-of tone 65547 67393
made only from milk tone 56913 61429
of the goat

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 -tone-
130000
120000
110000
100000
90000
8000
70000
60000

dec ian Feb Mar Apr May Jun July August sep oct nov dec
2008 2009

Fig. 1. Evolution of the amount of goat milk collected by processing units during the period
December 2008 - December 2009 (Source: [Link])

7
 II. The marketing plan of the company S.C. Covalact S.A.

1) Market description

The yogurt market has grown for two reasons: the change in consumption habits and
tending to of the Romaniansof a consume mult I many products lactate.
Year investments in marketing
BUDGET. Since the increase in the number of products on the shelf, the number of purchases has also increased.
yogurt promoted in the media, and implicitly, the expenses of the specialized companies. According to a
analyze Zenith Media, the budget allocated by them for media promotion during the period
January-June 2008 increased by 12% (at card rate), compared to the same period last year.
the most promoted being Covalact, Danone, Albalact, followed by those of but and those with
fruits. The evolution is largely due to the increase in the number of advertising clients from
this category.
Sales in this market segment have almost doubled from January to April.
2008, it had a similar period to last year, registering a growth rate of 176%, in
volume, at 202%, in value
Even though the market for fresh dairy products is growing, Romanians are falling behind.
of Europeans from the perspective of consuming these products. In Romania, consumption
the consumption of fresh dairy products per capita is about 5.4 kilograms per year, while in
Germany is 33.6 kilograms, in France, 33.7 kilograms, and in Bulgaria, 16.2
1 billion euros is the amount that the domestic dairy market could reach this year,
about 15% more than last year.

2) The targeted market segment

The types of segmentation used are: age, gender, place of origin.

Therefore, the existing yogurts on the market are aimed at certain consumer segments.
different. Depending on age, we have the following market segments: children between (2 - 12 years old),
adolescent (13 – 23 years), adult (24 – 50 years) and elderly over 50 years.
Children generally prefer yogurt with fruit, vanilla, chocolate which they like more and more.
the most popularity, young people prefer fruit yogurt, and simple yogurt, yogurt with cereals,
The dietetic yogurt and plain yogurt are generally aimed at adults, while seniors consume plain yogurt.
Regarding yogurt consumption, a higher proportion is observed in males.
feminine, these preferring diet yogurts or those with fruits. Among men, there
I notice a growing demand for yogurt with cereals, which helps improve digestion, being
consumed by people with an active social life, who do not have time to prepare a meal
This product is primarily consumed by people in urban areas.
In rural areas, consumption generally involves yogurt produced in households.
The formation of a family (household) will influence yogurt consumption through growth.
You sing because you want to nourish yourself. In the case of single people,
Generally, yogurt consumption is lower.
From the desire to meet the needs of potential consumers but also to
to attract as many customers as possible, the Covalact company has decided to launch a new type of yogurt: 'Covalact
from the countryside. Too good. Too much like the countryside" which is aimed at adolescents between 13-24 years old for a
better assimilation of knowledge and for improving memory.
Manufacturers and distributors are required to precisely define the segment of
the market in which it decides to compete. This is called the target market. To segment the market
it means to precisely choose a certain clientele.

8
3) Market trend

The management of Covalact, one of the main players in the domestic dairy market
fresh, with a margin of approximately 11%, I state that I analyze the market trends carefully,
on a downward trend, being ready to implement a program for growth
competitiveness in the market and the reorganization of activities in order to reduce costs, in
The conditions under which the dairy market returned to an upward trend in 2009 after a 20% decline.
registered in the first three months of this year, after the reprofiling of the major players who resorted to
discounts of up to 30% to combat the decrease in purchasing power.
The dairy product market contracted by about 3% in the first three months of this year, in
the conditions under which the purchasing power of Romanians has decreased by over 10%, against the backdrop of the crisis
economic. Pia a
Dairy products recorded a volume increase of 4.5% in the month. The dairy market will...
maintain the upward trend this year, against the backdrop of the adjustment of the strategies of major players, these
they rely on price reductions to reach their targeted sales volumes, in their opinion
Covalact representatives, who estimate that a number of producers will be forced to
The arena will shrink in the future as a result of the recession. 'The crisis accelerates consolidation.'

4) Competition and other influences

In the dairy market, the largest share of sales is held by

The drinking milk. These record, according to some estimates from producers in the year
In 2008, almost three quarters of the market, it is noted the existence in the Romanian market of a number
many small local producers making great efforts to carry out investments in
modernization, a mandatory condition after accession.
The strongest companies in the dairy market are LaDorna (with the large LaDorna and
Lady Milk), the company Covalact (Fulga and Zuzu), and Friesland (with the brands Milli, Oke, Cedra) which
it belongs to the local operator taken over by Friesland, Napolact.
According to some studies conducted by MEMRB in 2008, in the yogurt market there is
a number of about 24 brands active at the regional or national level. Main competitors
Direct competitors of the Covalact company in the yogurt segment are: Danone (brands
Activia, Actimel, Natural, Creamy, CasaBuna, The Flavor, Delicious, Frutissima), Friesland(with
brands Milli, Milli fruit test, Milli simple and pure, Oke), Albalact with brands Albalact and
Canpina.
The production of yogurt and buttermilk has dramatically decreased in the post-December period.
currently, they hold a very small share in the total market both in terms of volume and as
value. However, considerable increases in sellers are expected in this market, against the backdrop of
changes in consumption habits at both national and global levels. The global trend towards products
functional, healthy has imposed itself in Romania recently.
For the segment of yogurt and buttermilk, the most important competitors are
Danone (buttermilk), Fresland (with the brands Milli and Oke - buttermilk and sour cream), Albalact (buttermilk and
you), Lacta(you if beaten milk), Lactaprod(Brands Pacolact and Pacolactate-you and milk)
The competition among companies is very strong in this segment, manufacturers.
consolidating its position in anticipation of market expansion, once the accession takes place.
In the segment of fresh cheese, the competitors of Covalact are Friesland (with
brands Milli and Oke), Albalact, Napolact, Dorna Lactate. On the segment of processed cheese and cream of
The cheese market is concentrated at a small number of firms, the most important competitors.
Hochland Romania/Whiteland (market leader), Friesland (brands Oke and Frico)
The butter market, although small in size, is crowded. The first five companies hold
cumulative market share of 60.7% in sales volume. The most important players in this

9
Segments are: Friesland (with Napolact), Albalact, Lactalissi Meggle. Covalact is also included.
print the five important players.

5) Marketing strategy

[Link] S.A aims to invest in rebranding under the name 'Covalact DE'.
AR for all products in the company's portfolio that were previously under the 'Covalact' brand.
Produc torul de lactate Covalact a investit aproximativ 150.000 de euro pentru
the rebranding of Covalact DE TARA which will be available in stores starting in December.
The company also plans to invest 1.5 million in 2009 and 2010.
euros for technological modernization. "The first installations for yogurt, sour cream, and butter have been
was put into operation in September 2009 and the process continues throughout 2010, when they will be
I implemented other new installations, namely those for fresh cheese.
cases, with total investments amounting to 1.5 million euros," the company's data shows.
Pricing policy
Pre ul varies very little in I has a reduced influence on the purchasing decision.
The concept of price is closely related to the concept of product, with price being one of the elements.
the incorporeal aspects of a product, in the sense that the product can exist without a price, but in the absence
the product, the price, whether it is only imaginary or potential, has no object. In the case of the company
Covalact's positioning is the following:
The market segment Product Price level
Economic Covalat, Albalact - yogurt Reduced
Premium Covalact, Danone - sour cream Medium to high
Premium Covalact,Friesland-cascaval Medium to high
Special requirements Covalact - whipped milk Medium
In the fresh dairy segment (yogurts), Danone is competing for supremacy with
the local producer from Campina, being the undisputed leader in the fruit yogurt market.
According to statistics from the Romanian Dairy Industry Employers' Association (APRIL), depending on
In terms of revenue, the leader is Friesland company, with 70 million euros and a market share
from 20-25%, followed by Danone with 40 million euros.
The yogurt market rose in the first six months of this year to over 227 million lei, in
an increase of 22% compared to the first six months of 2007 and 11% in terms of volumes sold. In addition,
yogurt sales follow the trend observed across the entire retail market: sales through
the intermediary of modern commerce is growing, to the detriment of the traditional channel. As a subcategory,
drinking yogurt holds over half of the yogurt market, both in terms of sales volume and as
value.
Most manufacturers recorded sales growth as expected
pe care le aveau, cresterile - de volum si de incasari - fiind considerate firesti. Exceptia a
appeared at Albalact, where the launch of the Zuzu brand led to a 70% increase in revenue.
the company's business, beyond initial expectations.
However, the biggest winners have been the players who have bet in the last year on
the launch of fruit and plain yogurts. Sales in this market segment have almost
in Dublat, between January and April 2008, do from a similar period last year,
registering a growth rate of 176% in volume and 202% in value. 1 billion euros is
the amount that the internal dairy market could reach this year, about 15% more than
since last year. The main players are Danone, the market leader in the yogurt segment,
Friesland Foods, a leader in the entire market, Tnuva, Albalact, LaDorna, and Covalact.

10
 In the case of advance payment by bank transfer, the delivery term is calculated from
the moment of full and effective collection in the [Link] a countervalues
products that are the subject of the order placed through the above-mentioned site.
Payment in cash. Payment will be made in cash upon receipt of the package or at the pickup.
products of the headquarters Supplier .
The payment will be made in Lei, with the conversion done at the exchange rate (Leu/EUR)
announced by BNR on the day the invoice is issued.
All delivered goods will be accompanied by an invoice. The invoice can be paid in
the following ways:
- In cash or with a VISA, VISA ELECTRON, MASTERCARD or bank card.
MAESTRO, through the POS available at our location;
- Cash on delivery, in this case the receipt will be sent to you after receipt of
to Covalact of amounts paid in reimbursement; in the case of invoices issued for companies, the receipt is
send it along with the goods;
- By bank transfer/OP (before delivery), in this case, after making the payment, you will
Please send by fax or e-mail the payment document endorsed by the bank, so that we can dispatch it to you.
Marfa in the shortest time;
- Online payment with VISA, VISA ELECTRON, MASTERCARD or
MAESTRO, through the secure platform [Link]; in this case, after
the bank's confirmation of the transaction, the goods will be shipped to you with payment
transport to destination;
The delivery time is 24-48 hours, calculated from the date of your order confirmation.
for the products in the current stock. This term is indicative and can be modified by
independent motive of our will and primarily depends on the area where you live. If
one or more of the ordered products are no longer in stock, you will be informed in this
In this sense, the delivery time for these products is 10-15 working days. The products are
delivered while stocks last.

Distribution strategy
Distribution is carried out at the national level, through its own distribution network (fleet of
trucks that comply with all regulations regarding transport conditions
of products lactate), print the seas flavors of
hypermarkets (Carrefour, Cora), supermarkets (Mega Image, Billa), and cash & carry (Selgros) and
through its own deposits.
In the next two years, hypermarkets had a share of 42.5% of the total.
Sales in the first half of this year increased to 54.4%. From the point of
According to the preferences of the Romanians, yogurt remains at the top of the ranking.
a price increase of 64% in the first semester of this year. The following on the list of purchases
I like fruit yogurts, especially those with pumpkin flavor.
Covalact has 6 distribution centers in the country and specialized personnel for all.
activity segments: collection, production, distribution, quality control, etc.
If before the complete privatization of the company (1999) the daily milk intake capacity was
of approximately 6,000 liters, in 2005 the amount of milk was over 120,000 liters, that is
20 times larger. The distribution network has been continuously diversified, so that in
In 2006, Covalact was present with its products in almost the entire country.
In 2006, the growth rate of Covalact is nearly four times greater than
the growth of the dairy market in the period from January to September 2006, the current capacities of
Albalact's production being unable to fully meet the demand.
Covalact has increased the production capacity of the dairy factory in Covasna by 25%.
In 2006 to support the sales of the Cezara brand, launched in March 2006.

11
 Regarding Covalact brand products, we intend to conclude contracts for
national level with supermarket chains and discount-type stores. This strategy
The aggressive nationwide expansion is motivated by the rapid growth of commercial forms.
modern.

Promotion and public relations

Covalact invests 1 million euros in a new communication campaign. The producer of

Covalact launched a communication campaign to support the brand 'Covalact'.
Tara
Part of the rebranding process that started at the end of 2009, the dairy producer
Covalact has launched a new campaign to increase brand awareness and share growth.
from the market.

The role of advertising is to create demand for a certain product, and the company wants to
spend as much as necessary to achieve the planned sales. Furthermore, there are
I present a few specific activities that must be taken into account in the development of this.
budget.
Specific activities in budget development Details
Stage in the product life cycle Typically, new products require a budget of
consistent advertising, to inform them about
consumers of their existence and to determine them
they try. Mature brands usually need,
larger budgets, calculated as a percentage of
the value of sales.
Sink quota In the night mode, I walk with the footpath.
higher need for greater expenses with
advertising than brands with lower quotas.
The respective expenses can be calculated as
percentage of sales value. Creation of the market
or as the cigarette of a market quota at the expense of
the incurred expenses imply advertising
I am bigger than in the case of the minimum quota.
current.
3. They concur in the congestion
with many competitors that spend massively with
Advertising, a brand must be promoted more.
quiet to be noticed in the noise
for the advertising frequency. If
presentation of the message of the market to consumers
I need his broadcast several times, the budget
The publicity needs to be larger.

4. Product differentiation
The brand that resembles other brands from
that is the class of products (beer, beverages
I need higher expenses with
advertising, with a view to distinguishing it from
the other ones thank you. On the Romanian market
advertising for wines represents 10% of
total. When the product varies greatly in measure of

12
 the choice of competitors, advertising can be
used to highlight the differences
respective.

The company will invest over 1 million euros in the communication campaign, including
market research activities, creation, production, broadcasting, and national sampling for
brand promotion.
The communication campaign for the Covalact de Tara brand is carried out by
the creative agency Candiso, and the media campaign is provided by the media agency Optimedia
According to Covalact officials, between 2010-2011, the company will invest over 1.3
millions of euros in product quality, portfolio diversification, and increasing capacities of
production and logistics.
At the income level, the dairy producer estimates a 10% increase in 2010 compared to
since last year, when it reported business of around 25 million euros.
The company plans to expand distribution at the national level, both through the intermediary
the major international retail chains present in Romania, as well as through
distributors.
Currently, Covalact products are distributed in all major cities in the country, and
By the end of the year, the focus will also be on expanding logistical capabilities, according to
representatives of the company.
Thus, products under the new brand will be available in stores starting from the month
December. The investment in rebranding amounts to approximately 150,000 euros, including the part of
research, create ie, packaging replacement and a communication campaign that started in November
I continue this month,' declared Willy Cristea. Covalact is betting on growth this year.
with a turnover of 5%, up to the value of 61 million lei. The dairy producer has
ended the year 2006 with a turnover of 58 million lei, an increase of 15%, and a profit
2.5 million lei.
Investments for the current year will reach 2.5 million euros, an amount that will be
used for the modernization of production capacity. For this year, Covalact has scheduled a
triple the allocated amounts for promotion and marketing. The company has a portfolio of over
16 types of products were launched last year, according to our own estimates, with a market share of 2%.
The sales of the company are higher in certain areas, such as Covasna County, where the market share of the
Covalact recorded a 50% deposit last year, according to the company.
Necessary arrangements
The Saint George site is located opposite a central park benefiting from both
from the vicinity of the central park as well as from the attraction of the park's vegetation, an important center of
business in the city of Covasna. The headquarters where the investment project will materialize requires
some renovations, improvements and arrangements. For this, consolidation works will be carried out.
residential structures and necessary repairs will be carried out. Special attention will be given
utilities, higher finishes, and decorative elements.
The total value of arrangements and facilities will be:
-arrangements-120,453 Ron (according to the anticipated expenses estimate);
delivered materials - 314,561 Ron (according to market prices and selection of offer)
The arrangements will take a month and a half to complete.

13
 SWOT analysis

Strengths Weak points

The company offers a diversified range There are some higher costs
of dairy products, covering an area of only better than those of the competitors;
over 50% of the local market; There are some campaigns
• Extensive experience in the field; insufficient advertising;
The ability to create new products 5th place in
(cheeses); dairy sector
• Personal has prepared well, through Complete dissatisfaction of
THE ENVIRONMENT
organizing training sessions; market existence
INTERN Sufficient financial resources; The market for sale is
Equipment and machinery mostly conquered;
performant The position in the market
A rich experience in the field of it is not consolidated enough;
employed staff. • Non-inclusion in the offer
favorable liquidity values and I signed for certain varieties
solvency; fruit yogurt;
increase in sales compared to the year decreasing profitability compared to
precedent from the previous year;
• stable dividend policy, raw material milk varies
characterized by small variations in the rate from one season to another, that which
dividend it prints a certain
the company does not exhibit a high degree of cyclicality in its activities
dependency on a client or a if the necessity of establishing
group of clients. stocks in the winter period;
unfavorable situation of
financial balance at
the end of the year 2007.
Opportunity Dangers
Customer loyalty; Perspective of a competitor
The adoption of an intense policy of powerful from the
innovate companies present in the market.
• Increase in purchasing power of The rising cost of materials
population; prime;
THE ENVIRONMENT
The high weight that is allocated • Concurenta autohtona
EXTERN acquisition of food products. powerful.
penetration into new markets
Finding sources of supply
with cheaper raw materials.

14
 III. Market research

[Link] S.A requested a market research from the IRECSON company to identify
the image of the society and the general situation of the target market. The research was conducted on a sample
representative of 1,000 subjects. The results of this survey are presented as follows:

QUESTIONNAIRE

Are dairy products consumed in your family?

yes
b) no
very little

2. Which of the following age groups do you belong to?

a)18-25 ani
b) 26-34 years old
c) 35-42 years
d) 42-49 years
over 50 years

3. Your sex is:

masculine
feminine

4. Your professional status is:

student
entrepreneur
employee
omer

5. What are the reasons for which in your family you consume
dairy products?
one or more members suffer from a certain illness
b) care for family health
c) old motives
Which of the following brands do you consider when purchasing?
dairy products
Tnuva
b) Danone
c) Zuzu
Napolact
Covalact
f) Others

7. What is the origin of the dairy products they consume?

supermarkets and hypermarkets
b) mini-markets near the residence
c) others

15
8. How much does advertising influence your choice of dairy products?
mult
very much
c) put in
very few in

Do you know Covalact products?

yes
b) no
c) very few in

10. Have you heard about Covalact products:

in advertising
from friends/relatives
c) for personal interest

Do you consume Covalact products?

yes
b) no
sometimes

12. Which Covalact products do you prefer?

homemade cheese
yogurt you
simple yogurt
of horse
e) others

13. How do you consider the prices of Covalact products:

sea
b) mic
c) accessible

14. Cât de des cump ra i produse Covalact?

daily
b) 1-2 times per week
1-2 times a month
less often

15. On a scale from 1 to 10, what rating do you give to Covalact products?
ensemble?

………………………………………………………………………..

16. Are you in agreement with the statement: 'no day without Covalact?'
total disagreement
disagreement
c) indifferent

16
 d)agreement
total agreement

17. What do you consider to be the strengths of Covalact products?

a) accessible pre-ul
b) the quality of the products
the taste is delicious
beneficial effects on health
f) enforcement through advertising

Do you have a better state of health after consuming Covalact products?

yes
b) no

What do you think about the packaging of Covalact products?

bun
very good
not very good

20. Will you buy Covalact products in the future?

yes
b) now
c)poate

17
 Interpretation of the results

`Intrebarea nr.1

Are dairy products consumed in your family?

yes
b) no
very little

70
60
50
YES
40 68 NO
30 % MAYBE
20
10
12 20
0
% %

Analyzing the given answers, it is easy to understand that the majority of the population
consume dairy products. Another category of people (12%) stated that in
In my family, a very small amount of dairy products are consumed, while the others...
20% of the population acknowledges the consumption of a small amount of dairy products.

Question number 2.
Which of the following age groups do you fit into?
a) 18-25 years old
b) 26-34 years old
c) 35-42 years
d) 42-49 years
over 50 years

50

40
18-25
30 26-34 ABC
47 35-42 A B C
20 % 42-49

25 5 Code 50 TBA
10 15 % 8
% % %
0

Question number 2 revealed that people aged between

26 to 34 years old (these are generally married people, with children, tend to
to consume dairy products, to maintain their health and especially
the beauty.

18
Question number 3

Your sex is:

a) masculine
feminine

54

52

50 mucul
53% f⏏m⏂⏁⏂⏁
48

46 47%
44

It can be observed that there is not a particularly large difference in consumption.

of dairy products in men and women.
Thus, there is only a 6 percent difference between their consumption, women
holding the majority.

Question number 4

Your professional status is:

student
entrepreneur
employee
omer

40
35
30
Translation unavailable
25
zork
20
g j
15 37
10 23 13 27 fomor
%
5 % % %
0

According to studies, employed individuals are larger consumers.

of dairy products, consuming especially yogurt or buttermilk at work both
during lunch breaks you are only.
It has also been observed that unemployed people consume many dairy products as well.
the time they spend at home with family. Both students and people from
businesses hold smaller percentages.

19
Question number 5

What are the reasons why products are consumed in your family?
lactate?
one or more members suffer from a certain disease
b) care for the health of the family
c) old motives

I love you
mul gibberish
Hello
Go back
34%
Hello World
26% familiar

40% U ul um
mul? m mbr
What is it? It is
How are you? Are you fine?
0 20 40

People consume dairy products especially to feel good, for

the unique taste they provide or for other reasons (40 %). However, they are
36% of people purchase dairy products for family members.
they suffer from certain illnesses. Another category of people claim that in their families
dairy products are consumed for the treatment of certain diseases or prevention
It is known from ancient times that you stay healthy only
consuming dairy products.

Question number 6

Which of the following brands do you consider when making a purchase?

dairy products
a) Tnuva
b) Danone
c) Zuzu
Napolact
Covalact
f) Others

25

20 Tuv
Dogo
15
Zuzu

10 21 14 Nicolc
18
12 % 19 % 16 Covllic
5
% % Alkali
% %
0

20
It has been observed that the company Covalact holds the 2nd place (19%) in the ranking.
successful companies, both in terms of affordable prices and quality, being
the famous Zuzu, Napolact, and Tnuva.

Question number 7

What is the origin of the dairy products that they consume?

supermarkets and hypermarkets
b) mini-markets near the residence
others

l l
14%
100
80 32% migratory
60 Hello World
sensible clamour
40
20 54% ur
u rm r -

0 hyminar
ur

Since the products sold in supermarkets and hypermarkets are more

cheap, people (54% in this case) choose to buy dairy products from there,
thus benefiting from promotional offers regardless of their proximity
housing a grocery store. However, there are also exceptions when people buy
dairy products in small quantities, such as a yogurt or a pack of margarine,
to the nearest mini-market.

Question number 8

How much does advertising influence the choice of dairy products?

a) mult
very much
c) put in
very few in

15%
100%
80%
13% For the best
ˀbaʔ
60% 41% For the most part
40%
Mul
20% 31%
0%

From the 100 respondents surveyed, it can be observed that advertising

plays a particularly important role in the selection and consumption of products
lactate. Thus, 41% of these people say that advertising contributes to
their opinion formation on dairy products.

21
 Question number 9

Do you know the Covalact products?

yes
b) no
very few in

70
60
50 68 u
40 % 18 Forte cuccu
30
20 14 % Ford
Hello
10
%
0

From the graph above, it can be deduced that many people know
Covalact products

Question no. 10

Have you heard about Covalact products?

in advertising
from friends/relatives
c) for personal interest

100 16%
Hello
80 7% barrel

60 za zhi
ruru
40 77% Public health
20
0

Analyzing the given responses, it can be observed that advertising plays a role
particularly important in the lives of many dairy product consumers. thus, 77
Out of 100 people, they responded that they choose to buy dairy products based on
In advertising, 7% are influenced by friends or relatives, while the remaining 16% are from
personal interest.

Question number 11

Do you consume Covalact products?

22
 yes
b) no
sometimes

50
40 34
24 u
30
42 % cudgels
20
% % hello
10 u
0

People are asking if they consume Covalact products, I obtained a score.

quite vulnerable in this regard (42%), considering how many companies
activate on the Romanian dairy market.
24% responded that they do not consume Covalact products, while 34% buy them.
produced only sometimes.

Question number 12

Which Covalact products do you prefer?

home cheese
I miss you
simple yogurt
the horse
e) others

25 brazil c
câre
20 Our home

15
Our dream
25 25
10 17 % % 21 cucuml
% 12 %
5
% Alal
0

From the graph above, it can be observed that we have an equal score of 25% at
Covalact yogurt and whey products, these being the most purchased products.
Consumers. At the same time, 17% say they buy homemade cheese more often.
Covalact, cow cheese (12%) and other Covalact products (21%).

Question no 13

How does he consider the price of Covalact products:

sea

23
 b) mic
accessible

60
dead
59
40 mɔ c
%
19 abcdef
20 22 % acclable
controller
%
murder
0

As can be analyzed in the dairy market, we deduce that the price

Covalact products are quite affordable, with 59% of people
interviewed answered that they purchase these products both because of the price
accessible, as well as due to its quality. 22% of people consider the price
Covalact mare, but 19% small.

Question number 14

How often do you buy Covalact products?

daily
1-2 times a week for food
1-2 times per month
d) more rarely

50 zlc
40 It is 1-2 or 3-4 minutes
13
30 45 30 12 % 1-2 or 3 4 lu 1 0
mʌ l rʌ r
20 % %% mʀʊ rʀ
10
zalc
0

Of the 100 people involved in completing this questionnaire, 45% have

response that they purchase Covalact products daily (due to the quality-price ratio)
30% buy Covalact products once or twice a week, 12
people once or twice a month, having other preferences in this matter
of dairy products, while 13% purchase Covalact products less frequently.

Question number 15

15. On a scale from 1 to 10, what rating do you give to Covalact products?
ensemble?
According to the conducted survey, 74% of the respondents mentioned that
In their opinion, the quality of the products is satisfactory. Only 6% of them have

24
it is considered to be very good with a score of 10, while 20% have gone for the technology that
Based on these services, representing a score of 8, 41% considered it to be
The products are justified by their quality, scoring 6.
Question number 16

Are you in agreement with the statement: 'No day without Covalact?'
total disagreement
disagreement
c) indifferent
d) agreement
total agreement

0 50 100 150

inifin

The quality of Covalact products encourages consumers to agree with

the statement 'no day without Covalact (36 %), 13 % having a total disagreement towards
23% of them are indifferent to the products, 18% do not like them.
agreement, requesting that the remaining 10% have an agreement

Question number 17

What do you consider to be the strong point of Covalact products?

the pre-accessible
b) the quality of the products
the delicious taste
e) the beneficial effects on health
f) imposition through advertising
Brutal Accessibility
30

25

20 29 cluede
brochure
%
15
24 19
10 % 16 %
% 12 guul
5 sublime
%
0
afafcal

The question 'what do you consider to be the strong point of Covalact products?'
the interviewed persons (29%) acknowledged that the quality of the products makes it
the latter to be purchased as frequently as possible by as many people as possible.

25
Question number 18

Do you have better health after consuming Covalact products?

yes
b) no

60

50

40
55% D
30 45% No
20

10

Based on the graph above, it is observed that there is some certainty.

regarding the fact that people who consume Covalact products are more
healthy (55%). At the same time, there are also people (45%) who do not have health.
better after consuming them.

Question number 19

What do you think about the packaging of Covalact products?

a) bun
very good
not very good

qʌʊ
for you
the next day

60 51% 21%
40
28%
I am happy
20 for you
bu
0

Observing the graph above, it is evident that the packaging of the products
Covalact is one that consumers like, with 51% of them saying so.
this greatly contributes to their choices.

Question number 20

In the future, will you buy Covalact products?

yes
b) no
maybe

26
 50
40 34
30 % 17 34 u
49
20 17 49 % % o o
10 % u
% %
0

49% of those surveyed say they will buy certain items in the future.
Covalact products, due to their affordable price, 17% would not buy.
these products and 34% might buy Covalact brand products.

6. Identify and analyze risks

The risk elements that could affect the development of Covalact's activity are:
1. The quality of leadership presents a low risk regarding the management of the enterprise.
It is important to know its origin, its competencies, the dependency relationships of
the leaders' attitude towards the group or a majority shareholder, the leadership style (collegial, authoritarian,
on objectives, centralized, decentralized), the remuneration system, etc. Also, the age
members of the management, their formation, seniority in the company, areas of decision-making and
the limits of commitment and hierarchical control, their relations with certain economic-social environments
(clients, suppliers, employees, banks, external support, etc.), their image both internally and externally
In an enterprise, there are just as many components that largely define the way of leading.
the enterprise, to define and apply its general policy. Regarding the personnel
of the enterprise, it is important to see to what extent it is faithful to the enterprise and what the
the replacement possibilities in case of departure, and in the case of retirement, if it is provided for
succession. If the risk is at a reasonable level, so is the level of uncertainty.
The image also shows that personal resources are limited. And it is evident that employees feel less.
in uncertain and unknown situations, the satisfaction provided by the workplace is more
mother, because I achieve performance.
2. Industrial dynamics represents a medium risk that targets the market for sale of
of the company's products and its supply market. The main objective of the diagnosis
Industrial consists in estimating the current and potential market of the enterprise and its place in
In the context of industrial diagnosis, the following aspects are recommended to be addressed
esentiale: piata, produsele/serviciile, pretul si promovarea.
The financial situation is associated with the way of financing activities.
firmei,întreprinderea Covalact apeleaz la împrumuturi, ea î i asum o obliga ie financiar
fix, represented by financial expenses with interest, which makes borrowing through
its subtleties and costs, to determine the modification of the obtained results and the financial risk.
Yes, however, financing of activities is done only from internal resources, such as
the reinvested profit and the increases in share capital through new contributions from shareholders, this
does not imply taking on rigid payment obligations. The more fixed-cost obligations (loans)
banking, leasing) have a higher share among financial sources, the greater the risk
financing is higher.

27
Annex No. 1 - Organizational chart of the company SC Covalact SA
The Best Coffee
Amini...
Anicca
Gʁ nʁʆʈʈ

Cānídīyī Bō
A mini size
Finland

Rainy Day

Adoit Insetim

DREAM
Sgki
Destination Daring Toni Version of the Morning
E n mi
Seth
Aminisotsen
SAMPLE TEXT
Bi Bi Sapphire Hello
SILVER Canti Cᵉ dᵃ sᵕ sᵉ s Sibnocrac
I am In the dream L
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Domain Sgzkoi
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Hello everyone
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28
 Bibliography

[Link]://[Link]/
2. Pop, N. Al., (coord), Marketing Strategy, Economic Publishing, 2000, Bucharest;
3..Sica Stanciu “Bazele generale ale marketingului”, Universitatea din Bucuresti,2002
4. Torrico Plaza, Rosemery Sandra 'marketing strategies for penetrating foreign markets'
ASE, 2003
5. Toiu, I. (coord.), Marketing Research, Uranus Publishing, Bucharest, 2002;
6. Kotler, P. Armstrong, G., Saunders J., Wong V., Principles of Marketing, Publisher
Teora, 1999, Bucharest;
7. GHICA I., (1967) The legal regime of state budget revenues, Scientific Publishing House,
Bucharest,
[Link] Magazine
9. Info manager
[Link] [Link]
[Link]
[Link]://[Link]
[Link]
[Link]
[Link]
[Link]
17. 'Marketing' coordinator Virgil Balaure, Uranus Publishing
18. Financial newspaper
[Link] Top business of Covalact companies

29