1.

0 INTRODUCTION
Adabi Consumer Industries Sdn.Bhd is one of company in Malaysia which has monopolistic
market structure.Adabi Consumer Industries Sdn.Bhd was founded by Dato’ Syed Manshor Syed
Mahmood in 1984. Adabi Consumer Industries Sdn Bhd is the parent company whereas Adabi
Group is the main player of the company. They produce and markets products under the brand
name of Adabi. The first batch of Adabi products rolled off from a small factory in Batu Caves
Light Industries Area. Since their venture has grown immensely and market growth steady over
the year has prompted them to shifted to biggest factories in Taman Kepong Light Industrial Area
in 1986 and two more plants at Taman Ehsan Light Industrial Area in the year 1990 and
1992.The company shifted to its own factory and office premises located in Rawang Integrated
Industrial Park in November 1996.This is because of rising consumer demands for instant food
market which prompted them to expand.

Adabi brand was continually distributed to Malaysian consumers that have 100% Halal
label and high-quality products. In addition, Adabi brand also has managed to penetrate to
consumers outside of Malaysia such as Indonesia, Japan, Singapore, Mongolia, United Kingdom,
Australia, Brunei and Jordan. Today, Adabi has become a well-known household brand with the
existing products of more than 100 types under 10 main categories such as powdered spice mix,
processed paste, flour mix, sauce, canned food and beverage. Adabi will consistently aim to
identify and innovates the products to serve households and market needs.

Photo 1: Small factory of Adabi in Batu Caves Light Industries Area

 Photo 2: The biggest factories in Taman Kepong Light Industrial Area

Photo 3: Own factory and office premises of Rawang Integrated Industrial Park

Photo 4: Products of Adabi

2.0 MONOPOLISTIC MARKET STRUCTURE OF ADABI
Adabi Consumer Industries Sdn.Bhd is one of company in Malaysia which has monopolistic
market structure because they have the aspects that a perfect competition has except their
products are not exactly like their competitors such as Baba’s, Faiza, Alagappa’s, Maggi and
Mak Siti. Product differentiation is the real or perceived differences between competing products
in the same food industry. The firms highly compete with each other on various factors other
than prices such as brand, size, color and quality. Adabi’s basically could differentiate its offer in
a few differentiations, which are product, image or brand differentiation.

Firstly, for product differentiation, Adabi’s differentiated their products based on

ingredients and tastes. Nowadays, customers are aware about the taste of quality food that they
buy worth the money or not. Most customers believe that home cooking is the best for them
because they can estimate what kind of ingredient they want to use because too much flavouring
can affect their health. Somehow, Adabi’s products are guaranteed 100% Halal, hygienic,
wholesome, and healthy. To avoid that, Adabi’s decide to produce their Fried Rice Paste by
minimize amount of permitted flavouring and good cooking-oil inside, special mixed spices
which can provide special quality in consideration for the customers health. Besides that, Adabi’s
also produce this Fried Rice Paste in one flavour only which make it easy for consumers to
choose as the taste is suitable for all age. Adabi’s has seemed that considers of its customers’
needs because this paste contain all in one flavour. This make it is special and unique as well as
different from other company make it become one of competitive advantages for in competing
with its competitors. Thus, because of the speciality they made for the product, Adabi’s will
attracted a lot of customers in purchase their products and will eventually be their loyal
customers in the future.

Furthermore, even when competing offers look the same as Adabi’s paste, buyers may
perceive a difference of the product they want to purchase based on company and brand image
differentiation. Basically, a company or brand image should carry the product’s distinctive
benefits and positioning. While developing a strong, powerfully build and distinctive image calls
for creativity and a lot of work. For example, the chosen of symbols, characters, and other image
elements that must be communicated through related advertising that brings the company’s or
brand’s personality. Here we can conclude that Adabi’s has introduced its brand’s advantages and
differences in customer’s minds. Because of that they got an idea to create the Logo which is
represented by the established Royal Malay Palace of Malacca in the sixteenth decade. Its mean
the quality food product will be same which was served to the royalties in the past.

Adabi use competition pricing when introduce product at the new market. Adabi will
setting a price for the products in comparison with competitors. There will be option that Adabi
will get from this setting; price lower, price the same or price higher than competitor. Adabi will
choose price lower but high quality, suitable with their objectives.

3.0 Market Equilibrium in Short-Run

For the past few years, Adabi faces a lot of challenges in trading and retailing. However, Adabi is
spearheaded by a strong and experienced management team. It has comprehensive research and
development facilities to develop innovative food products. Having good products is one thing
but getting them to the consumer in another. Adabi has worked hard to establish an efficient
distribution system for its products. Besides that, Syed Manshor begins his business by selling
fried rice paste and banana fritter flour only in the wet market around Kuala Lumpur in the early
70’s. However, yearly they produce a product to expand their business. These products are
divided into five different products lines namely curry, soup, paste, sauce and flour-based
products. In short period, they produce 70 products including powdered spice mixes, processed
paste, sauces and flour mixes (The Star,2007). Moreover, Adabi won The Honored Product
Award (Malaysian Institute of Food Technology) on 1997 and International Food and Beverage
Award (New Millennium Award) in Paris on 2000.They also receive Industry Excellence Award
on 1999 & 2002.
 Photo 5: The first 2 product which produce by Adabi
The rapid growth of the company, from a staff of 25 and annual sales of RM2 million in
1984 to its current position of more than 400 personnel and an annual sale of RM120 million can
be attributed to the success of the range of new products it has introduced through the decades.
Based on The Star,2007 Syed Manshor mentioned that by introducing more products, it expects
revenue to increase further to RM102 million per year. However, Adabi's pre-tax profit fell
slightly to RM4.5mil in 2006 from RM4.8mil in 2005 due to the higher costs of packaging and
raw materials. In addition, the packaged food sector registered a growth of only 3% to RM12.1
billion in 2005 from the previous year. In terms of packaged food, Adabi has about 0.2% market
share compared with Nestle's 14%. Its curry products were the second most popular after Baba's
with about 13% market share, Syed Manshor said.

Besides that, based on The Star online, 2007 Dato Syed Manshor Syed Mahmood
mention that he strongly focuses on brand building rather than depend on wholesaler’s
distribution. In addition, he also mentions that as medium-sized company; need to build a strong
brand to penetrate the mass market so that retailers and consumer will recognize the brand. The
company needs a strong brand and quality products to compete with bigger players like Baba’s.

Adabi create the Logo which is represented by the established Royal Malay Palace of
Malacca in the sixteenth decade. The Malay palace symbolizes that Adabi's products have the
power of inheritance in line with the quality of food served to royal relatives in the past. They
give continuous commitment in providing consumers with products of the highest quality is
assured through strictest standards of requirements set on the processes and the quality of the
material used. Therefore, Adabi products are guaranteed 100% halal, hygienic, wholesome and
healthy. In recognition to quality, Adabi Consumer Industries Sdn Bhd is the first food company
which received the award of Halal Certificate from JAKIM (Jabatan Kemajuan Islam Malaysia),
ISO 9001: 2000 certification in 2002 and the transition to the ISO 9001: 2008 Certification by
SIRIM Berhad in 2009 for its Meat Curry, Kurma and Soup Powder Paste.

Through this ISO certification, every production process needs to meet the 'Quality
Management System', where each production process needs to comply with the standard
Operation Procedure. To ensure that each process either in the Production or Administration
section complies with ISO standards, annually an ISO internal audit session will be conducted by
a group of trained ISO internal auditors and audit sessions by SIRIM QAS. With the certification
of ISO 9001: 2008 and practicable, it ensures the best quality of Adabi product and satisfies the
needs of its customers.In fact, Adabi products were the first which receive Halal certification
from the Islamic Affairs Division of the Prime Minister’s Department. Among other awards
received are Superbrand Status (Reader’s Digest Malaysia) on 2005, Industry Excellence Award
(MITI) and Special Award for Innovative Product (Malaysian Institute of Food Technology).

Adabi has a strong marketing campaign directed at its principal markets. The company
make their advertisement more effective in order to provide clear information to ensure the
international consumer aware of the products. Most of their promotions involve conducting
cooking demonstrations, featuring the company’s various brands, naturally, with homemakers
and chefs. Adapi employs various chefs to conduct demonstrations and workshops in hotels,
supermarkets and with key partners like magazines and newspapers. Store samplings are another
way to ensure consumers know about the good taste and nutritional values of Adabi products.
Adabi has conducted joint promotions with Seri Angkasa Restaurant in Menara KL(the
telecommunications tower in the centre of the capital) and Wanita UMNO. Adabi was the first
curry brands to advertise on Malaysian television, thus enhancing sales and brand recognition.
Moreover, Adabi adversite products on television by program ‘Jagung Kampung Event’ & Spice
Routes, in magazines such as ‘Majalah Metro & Majalah Niaga’, newspapers (Utusan, Berita
Harian, The Star News) and in store promotions.

Other than that, Adapi focus on the importance of social network. As the people
nowadays more connected through the internet as they can easily find information with no
limitation, Adapi aggressively use social network such as blogs, websites, Youtubes and
Facebook as marketing tool. The basically reduce the cost of the company because developing
international market using social network does not require high involvement. Adabi have own
website that customers can get information from the website about their products, history,
management teams, awards and others. Adabi also use Facebook as platforms to connect with
their customers. Youngsters are always with their smartphones Adabi can catch their eyes with
the attractive video, promotions to attract them buy the products. It will be an advantage to Adabi
makes a video recipe how to cook fried rice using their paste. YouTube also famous web to post
video and become trends nowadays. Youngster like student they look on YouTube to search the
recipe of the foods. Indirectly, this will help Adabi to market their products. As become a trend,
not only youngster but everyone in the world also use YouTube to look for the music, tutorials
and many more. Based on The star News,2007 Syed Manshor said Adabi spent RM4 million to
RM 5million a year on advertising and promotion to strengthen its brand.

Currently, Adabi markets its products mainly through wholesalers and retailers, apart
from selling directly to 20% of its clients, which constitute hypermarkets and supermarkets.
However, the company has 11 distributors strategically located to cater directly to more than
7000 retailers, wholesaler and supermarkets nationwide. Adabi expand their market globally
without a doubt especially to Indonesia market through PT Multi Alam Prima Rasa. PT Multi
Alam Prima Rasa is 92% owned by ACISB. PT Multi Alam Prima Rasa was established in
January 1994 to facilitate the export process of Adabi products to Indonesia. At present, Multi
Alam Prima Rasa registers 11 Adabi products and each product is marked with a valid trading
number. Since the registration, range of Adabi products were brought into Indonesia, mainly to
Medan, Sumatera. Medan has been picked as the entry point as Adabi products are no strangers
to the locals who knew about Adabi from Malaysia TV transmission.Demand for Adabi products
is encouraging and various inventions are being made for products that can be distributed to
other parts of Indonesia. Based on The Star,2007 the company's revenue grew from RM87.3
million in 2005 to RM97.1 million in 2006, of which 5% was derived from export markets.

3.0 Market Equilibrium in Long-Run

Adabi Consumer Industries aims to become one of the largest packaged food manufacturers in
Malaysia by 2020, and to produce flavor some, healthy and high-quality food products meeting
international Halal standards. In addition, the company also hopes to be the largest distributor
and to become a multinational company in packaged food by 2020.Based on Utusan,2018
Adabi’s annual sales reach up to 640 million which is 20% while comparing with 2017 which is
540 million. Besides that, they also mentioned that so far, they got produce around 250 products
with various categories. In respective to these, Syed Mahadzir mention that soup spices and
fritter flour contribute to 90% whereas paste contribute 60%.

Annual sales of Adabi based on years

660
640
Annual sale(million)

620
600
580
560
Annu
540
al
520 sales
500
480
2016.8 2017 2017.2 2017.4 2017.6 2017.8 2018 2018.2

Years

Consumer of business and restaurant contribute to the high sales. The company, whose major
market segment comprises Malays, plans to introduce more products that suit all Malaysians.
Adabi's also export their products to others countries as well, such as Singapore, Japan, Hong
Kong, the Middle East and Britain to expand the growth of business.Currently they working with
ara Adabi is still the market leader for its spices and paste products, with about 75% market
share. When each time they come out with a new product, they spend half a million for the
Research & Development, pasteurized technology, packaging, product launch, marketing and the
whole works. They are committed to give the best to their customers said by Adrian in The Star
Online during interview on 2015.Moreover, the more production of product, Adabi provide more
job opportunity for Malaysian.
In order to make consumer easier, they launched its online shopping portal such as you can buy
products through Lazada, Shopee and etc. They have looked into all the logistics. Those who
purchase online will get fresh products right from our factories in Rawang, and they can return
the goods to the distributor if they are not happy. Delivery is free for purchase of RM30 and
above.

4.0 CONCLUSION
Adabi product was created in 1984 from a small factory, Light Industrial Area in Kuala Lumpur.
Within a span of two decades, the company was able to make Malaysian consumers fall in love
with their products. They still ride the train moving towards local and global success. Adabi have
many products such as, curry and soup, sauce, pasta product, flour, instant product and have
local and international branches. By joining the International strategic partnerships in Indonesia,
they increase their market share and strength. The aim should be to structure an alliance that will
achieve both goals partners. A good strategy can start with the option that offers the most
flexibility and a move towards greater commitment once we have more experience and
confidence in selected markets. Whatever strategy the company chooses, they will need to ensure
their business is well protected. The proper strategy planning will be lead to successful growth of
company.

Adabi expand their market globally without a doubt, especially for the international
export market. As marketers before entering the international market, marketers should do
research on the state and people over there. Adabi must produce product which adapt according
to the needs of their consumers. This is an advantage for Adabi to join the international market
because the Malays were also there. They will probably be the first customer and will be spread
to family, friends, college friends, housemates through word of mouth. Adabi is a famous brand
in Malaysia so they have a high market share and willingness successfully to expand their
market.
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