Abstract:
Pakistan is a large consumer product market which accounts for more than 40% of consumer
business and worths $ 152 million showing an annual growth rate of 8% . The retail scenario in
Pakistan has changed from Kiryana stores (GT) to Superstores (LMT/IMT). Kiryana donot promise
all products at one place and superstores offer one window solution. Moreover, LMTs in Pakistan,
offer better price deals as compared to IMTS and therefore have more customer traffic. Due to the
change in this retail scene, the giant retailers especially LMTs have gained greater importance in
Pakistan. Maintaining good relations with these LMTs therefore have become very critical for
FMCG firms. Tang, one of the flagship brands of Mondelez Pakistan, in summer 2013, had lost 40%
market share of powdered beverage, when one of the giant LMT, Imtiaz Superstore entered into an
arm’s length relation with Tang Pakistan. The bone of contention between the two was the refusal of
Tang Pakistan to co-advertise with Imtiaz superstore. Tang Pakistan had to pay a high price for these
bitter relations when it revived the relationship with this giant superstore by paying unusually high
shelf rent. Also it had to face immense competition not only from local powdered beverage brands
but also with Tang international. This case uncovers how LMTs are operating in Pakistan and the
way they are dictated by these retailers for high sales and profit.
