PRESENTATION ON MARKET POTENTIAL OF “LOW VOLTAGE SWITCH GEARS”
IN RAJASTHAN [APRIL 2004-JULY 2004]
Facilitated By Mr.. S. Sanyal Mr.M.P.Jindal Mr.Vishal Nerurkar Mr. Vikas Malhi
Presented By. Japneet Singh Lokesh Doraya Manish Patidar 1
WHAT ARE LVSWGRS??
DISTRIBUTION
PROTECTION
SWITCHING
*ACB *SFU
*MCCB *LOAD BREAK SWITCHES
*CONTACTORS *CONTROL RELAYS *MINI COTACTORS
*THERMALOVER LOAD RELAYS *SOFT STARTERS *STARTERS
*MCB *DISTRIBUTION BOARDS
*RCCB *ISOLATOR
2
COMPANY PROFILE •24th Dec 1949- Hindustan Electric Company Limited Was Incorporated •1965- Name Changed To Hindustan Brown Boveri Limited •1989- Name Changed To Asea Brown Boveri Limited Due To Amalgamation of Asea Limited With HBB •2003- Name Changed To ABB Limited •1994- ABB Started LVSWGRS Manufacturing in INDIA at Bangalore •Core Business Area --•Power Technologies •Automation Technologies •Building Systems
3
4
PROJECT OBJECTIVE
• To forecast the sales revenue of ABB in Rajasthan for “Low voltage switch gears” for next 3 years. • To suggest a marketing strategy to ABB for increasing revenue of LVSWGRS from 34 Lakhs to 3 Crores within next 3 years.
5
SUPPLY CHAIN- LVSWGR
PANEL BUILDER
SUPPLIER
D E A L E R
OEM
C O N S U L T A N T
INDUSTRY
6
SURVEY METHODOLGY
•Designing a tool for conducting the survey: •Data Collection: Phase I: Jaipur, Jodhpur, Udaipur, Kota. Phase II: Chittorgarh, Bhilwara and Alwar
•Questionnaire for consumer •Questionnaire for dealers •Final analysis: •Suggestions:
7
RAJASTHAN MARKET SCENARIO
•Total LVSWGR Market
27.82 Cr.
•No. of Delaers covered
34
•No. Of customers visited
100
•Average market growth
18%
8
RAJASTHAN MARKET AREA-WISE BREAKUP P R E S E N TM AR K E T
Crores
G R O W T H
14
28%
25% 12
11 .82
24%
20% 10
20% 19%
8
16% 15% 12% 10%
6
12% 4.75
4
10%
3.25
8% 3
3
2
4% 1
1
0
0% JA IPU R
U D A IPU R
K O T A
B H IL W A R A
JO D H PU R
C H IT T O R R
A L W A R
9
PRODUCT SEGMENTWISE BREAKUP
LPD 17%
Whole Rajasthan
BREAKERS 20%
SWITCHES CONTROL
24%
GEARS 39%
BREAKERS LPD
ABB
39%
28%
CONTROL GEARS 25%
SWITCHES 8%
10
Schneider
L&T
LPD 9%
BREAKERS
LPD
BREAKERS
21%
17%
31%
CONTROL CONTROL
GEARS
GEARS
SWITCHES
32%
46%
SWITCHES 14%
30%
Siemens LPD 10%
BCH BREAKERS 20%
CONTROL GEARS 50%
SWITCHES 20%
CONTROL GEARS 100%
11
MARKET SHARE OF MAJOR PLAYERS Lakhs
1200
1058.25
1100 1000 900 800 630.5
700 600 500
340
400
221.25
300
133.75
200
110.5
99.7
95
34
59
ABB
OTHERS
100 0 L&T
SCHNE IDE R
BCH
SEIMENS
MDS
GE
HAVELLS
JYOTI
12
RANKING GIVEN BY CUSTOMERS TO ATTRIBUTES : 4 .5
4.45
4.45
4 .4
4 .4 4.35
4.31 4 .2
4 .3 4.25 4 .2 4.15 P R OD U C T
S E R V IC E
P A C K A GIN G
B RA ND
13
PRODUCT ATTRIBUTES 5
4.91 4 .7
4 .8
4 .5
4 .6 4 .4
4 .2
4 .1
4 .2
4 .1
4 3 .8 3 .6 Y T I L I B A I L E R
Y T E F A S
S E R U T A E F
L A C I N H C E T
N O I T A T N E M U C O D
E C I R P
E T E L P M O C
E G N A R
14
SERVICE ATTRIBUTES
4 .8 4 .6
4 .6
4 .5
4 .5
4 .4 4 .2 4
3 .9
3 .8 3 .6 3 .4 R E S P O N S E T IM E R E P L A C E M E N T SS T OC K A V A I L B I L IT Y IN S T A L L A T IO N GUIDANCE
15
BRAND ATTRIBUTES
4 .6
4 .4
4 .5 4 .4 4 .3 4 .2
4 .0
4 .1 4 3 .9 3 .8 B R AN D N AME
D E A L E R R E P U T A T IO 16
PACKAGING ATTRIBUTES 4.38
4 .3
4.36 4.34 4.32 4 .3 4.28
4 .2
4.26 4.24 4.22 4 .2 INS TA L L A TIO N L EA FL ET S EA L S & CER TIFICA TIO N 17
CUSTOMERS PERCEPTION ABOUT ABB’s ATTRIBUTES ABB
AVG
4.5
4.5
4
4
3.5
3.5
3
3
2.5
2.5
2
2
1.5
1.5
1
1
0.5
0.5
0
0 Y IT L A U Q
G N I H S I N I F
E C N A N E T N I A M
E IM T N W O D
Y G O L O N H C E T
N O I T C U R T S N I
T E L F A E L
E C I R P
Y IT L I B A I L A V A
G N I N I A R T
18
SUPPLIERS POLICIES S U P P L I E R S C H N E I D ES E I M E N R R E V E N U E D E A L E R S S A L E S
630.5 LAKH 15 6
B C H
L & T
A B B
S
221.25 LAKH 7 2
340 LAKH 11 4
1058 34LAKH LAKH 7 10 5 1
P E R S O N S E R V I C E
2
0
0
2
0
60
30
70
45
45
C E N T E R C R E D I T P E R IO D
IN
D A Y S D I S C O U N T
20% to 38%
O F F E R E D
3%
P R O F I T M A R G I N D E L I V R Y P E R IO D
10 to 20
15 to 25% 2.5%
`20% to 15 to 20% to 30% 45% 30% 3% 3% to 4% to 4% 5% 20 to 25 10 3 to 4 20 to 3 0
IN
D A Y S
19
INCENTIVES & PROMOTION S U P P L I E R S C H N E I D E RS E I M E N S
B C H
L & T
A B B
C ash Cash Cash Q u a n t i ty C a s h D i s c o u n t , D i s c o u n t , D i s c o u n t D, i s c o u n Dt i s c o u T u r n o v e r T u r n o v e r T u r n o v e r nt, D i s c o u n t ( 2 % D) i s c o u n t , D i s c o u n t T urnov P r o d u c t F o c u (s 3 % ) e r D iscount D iscou nt S e m i n a r , S e m i n a r ,I n p l a n t O M O T I O S e m i n a r , A d v T s, G ifts D irect G i f t s S e m i n a r s- ,- - - - - - N M a i li n g , Sem inars, -G ifts, G ifts Product D irect D em onstratio M ailers n ** O nly in G ifts Lunch N T R I B U TA d v t . a n d G i f t s 5 0 % n e w s p a p e r 1 0 0 % and -------I O N A d vt. 50 % G ifts50 % ---
I N C E N T I V E
P R
C O
** L&T provide 1% of turnover, for advertising expenses 20
ANALYSIS
•DRIVERS INDEX GRAPH •STRENGTH WEAKNESS OF DIFFRENT PLAYERS •SERVICE QUALITY GAP ANALYSIS •ACTION PLAN
21
DRIVERS INDEX GRAPH
L & TS I E M EA NB SBB C HS C H N 6 5 4 3 2 1 0 Q U A L IT Y
P R IC E
A W A R E N AE SV SA I L A B IL ICT RY M 22
STRENGTH WEAKNESS SCHNEIDER STRENGTHS
•AGGRESSIVE PROMOTION •BRAND PUSH •EXCELLENT AFTER SALES SERVICE •AVAILABILITY •STRONG MARKETING TEAM •TECHNOLOGICALLY SOUND •PRICING STRATEGY • STRATEGIC ALIANCES. WEAKNESS
•DEALERS DILEMMA
23
STRENGTH WEAKNESS L&T STRENGTHS
•AGGRESSIVE PROMOTION. •BRAND PUSH. •EXCELLENT AFTER SALES SERVICE. •AVAILABILITY. •PRICING STRATEGY. •QUALITY. •AWARENESS. WEAKNESS
•DUPLICACY 24
STRENGTH WEAKNESS ABB STRENGTHS
•QUALITY. •TECHNOLOGY. •COMLETE RANGE WEAKNESS
• LOW AWARENESS • PRICING • DOUBTFUL BRAND POSITIONING • DELIVERY • WEAK MARKETING TEAM • POOR AFTER SALES SERVICE • NO BRAND PROMOTION SCHEMES
25
STRENGTH WEAKNESS SEIMENS STRENGTHS
•GOOD BRAND EQUITY •GOOD BRAND AWARENESS •GOOD COMMUNICATION WITH CUSTOMERS THROUGH DIRECT MAILERS AND SEMINARS •STRATIGIC ALLIANCES WEAKNESS
•POOR DEALER NETWORK •POOR AFTER SALES SERVICE
26
STRENGTH WEAKNESS BCH STRENGTHS
• GOOD DEALER NETWORK • FAST DELIVERY. • GOOD AFTER SALES SERVICE • SPECIFED INDUSTRY DEMNAD. • COMPETITIVE PRODUCTS WEAKNESS
• LIMITED PRODUCT RANGE. • REACH IN LIMITED INDUSTRIES • POOR QUALITY PRODUCTS 27
Service Quality Gap Model GAP1: Between what customer expects from the service and what the management perceives of customers' expectation. GAP 2: Between, management perceptions of consumer expectations and translation of perception into service- quality specification GAP 3: Between, translation of perceptions into service-quality specifications and service delivered to consumer. GAP 4: Between service delivered and the external communication to the consumer. GAP 5: Between perceived service and the expected service. 28
Word of Mouth Communication
Personal Needs
Past Experience
Expected Service
GAP 5 No Gap due to continuous competition
GAP 1
Availability Quick response After sales service Quick delivery Competitive pricing
Perceived service Consumer Marketer Service Delivery
GAP 3 Generation of customized products
External Communications to consumers GAP 4 Prompt delivery to the consumer.
Translation of Perceptions into service-quality specifications GAP 2 Technical and Financial feasibility
Management Perception Of
29
AIM 3 CRORES P L A C E
C U R R E N T
M A R K E T
A B B
A B B
A B B
S H A R E
S H A R E
2004
2005
2006
JA IPU R
3.70
43%
30 .1 0
62 .3 5
129
U D A IP U R
12
17%
1 1 .9
24 .6 5
51
8.30
11%
7.7
15 .9 5
33
B H IL W A R A
8
12%
8.4
1 7 .4
36
JO D H P U R
2
10%
7
1 4 .5
30
C H IT T O R R
**
3.5%
2.45
5.075
1 0 .5
A LW A R
*
3.5%
2.45
5.075
1 0 .5
TO T A L
34
100%
70
145
300
K O T A
All figures in Lakhs.
30
AIM 5 CRORES PLACE
CURRENT SHARE
MARKET SHARE
ABB 2004
ABB 2005
ABB 2006
JAIPUR
3.70
43%
35.80
87.70
215
UDAIPUR
12
17%
14.10
34.70
85
KOTA
8.30
11%
9.15
22.40
55
BHILWARA
8
12%
10
24.50
60
JODHPUR
2
10%
8.35
20.5
50
CHITTORR
**
3.5%
2.95
7.10
17.5
ALWAR
*
3.5%
2.95
7.10
17.5
TOTAL
34
100%
83.30
204.08
500
All figures in Lakhs. ** Chittor is procuring from Udaipur.
* Alwar is procuring from Delhi. 31
SUGGESTIONS:
• • • • • • • • • • • • • •
APPOINT SALES PERSONS ORGANISE SEMINARS SEND DIRECT MAILERS OPEN A SERVICE CENTRE PRODUCT AVAILABILITY AND PROMPT PRODUCT DELIVERY SUPPORT THE DEALER DEALER SELECTION PARAMETERS SUPPLY CHAIN COMMUNICATION ADVERTISEMENT CUSTOMISATION EMBOSSED SPECIFICATION SEAL TARGETTING ALLIANCES SPARES’ STOCK CRM FEEDBACK FORM 32
EXPENSE DETAILS REGION/ HEADS
Jaipur
SALARY
Jodhpur
Udaipur
Chittor garh
180,000
Bhilwara
Kota
Alwar
180,000
SEMINARS
70,000
70,000
70,000
a) Common
20,000
20,000
10,000
70,000 50,000
Rajasthan
3,60,000
70,000
70,000
30,000
4,20,000 1,30,000
5,50,000
b) In-House DIRECT MAILERS
10,000
ADV.-*JOURNLS
20,000
Total
90,000
270,000
80,000
50,000
280,000
70,000
70,000
9,40,000
* Journals—Industrial Product Finder, Electrical India 33
SUSTAINABILITY PRESCRIPTION
• Sync with Market Growth • Regular Market Promotion •Confidence building measures (C BM) with dealers •Common payroll employee • Stalling Threat From New Entrants. •Financial backing of the entrant. •Technology. •Marketing efforts deployed. •Brand image. 34
AREAWISE INFORMATION ALWAR
•Total Market As Per Dealers Is 75 Lakh •While Total Market Perceived by Dealers 1 Crore. •The Region Is Expected to Grow With 10% Growth Rate •Customers Covered Are Using 145.85 Lakh LVSWGR Products •No. Of Customers Covered--17 •No. Of Dealers Covered--2 35
SUPPLIERS POLICIES SUPPLIER
SCHNEIDER
SIEMENS
MDS
L&T
REVENUE DEALERS SALES PERSON SERVICE CENTER CREDIT PERIOD IN DAYS DISCOUNT OFFERED PROFIT MARGIN DELIVERY PERIOD IN DAYS FREQUENCY OF VISIT RESPONSE TIME TO COMPLAINTS
12.5 LAKH
2.5 LAKH
3.75 LAKH
50 LAKH
1
1
1 -
-
-
-
-
-
-
-
30
30
15
60
Not Disclosed
Not Disclosed
Not Disclosed
20%
Not Disclosed
Not Disclosed
Not Disclosed
5%
7
7
7
3
YEARLY
15 DAYS
OK
SOON
YEARLY OK
OK
36
SUGGESTIONS •
• •
• •
•
•
Com pany should appoint a D ealer in this region. And do their business along w the dealers. Product availability should be go od. ABB shouldorganise technical seminars and after seminar, company Enginee should be in touch with these potential customers. Mo re emphasis mu st be given to the new projects. As replacemen t is one to one. Reach toInfluencers' must be increased by regular visit by company Enginee and dealers. Visits must be there even when there is no requirement to brief up the indus engineers. Aw areness about the products must be increased.
37
CHITTORGARH
•Total market as per dealers is 80 LAKH. •While total market perceived by dealers 1 crore. •The region is expected to grow with 15% growth rate. •Customers Covered Are Using 84.2 Lakh LVSWGR Products •No. Of Customers Covered--7 •No. Of Dealers Covered--1 38
SUPPLIERS POLICIES SUPPLIER
L&T
REVENUE 64 LAKH 1 DEALERS SALES PERSON --SERVICE CENTER --CREDIT PERIOD IN DAYS CASH DISCOUNT OFFERED UP TO 35% 5% PROFIT MARGIN DELIVERY PERIOD IN 7 TO 10 DAYS FREQUENCY OF VISIT 15 DAYS RESPONSE TIME TO IM MED IATE COMPLAINTS
HAVELLS
16 LAKH 1 -----CASH UP TO 30% 5% AS PER REQUIREMENT MONTHLY OK 39
SUGGESTIONS •
•
•
• •
R e g u l a r c o n t a c t w i th c u s t o m e r i s m u s t . It c a n b e d o n e t h r o u g h S e m in a rs. o D irec t m aile rs. o P lan t v isit. o C o m p an y S h oourld g an ise sem inar to B r ie f a b o u t p r o d u c t r a n g e . o P rod u ct’s tech n ical d etails. o T o h igh ligh t sp ec ial fea ture s o f A B B p ro d u ct as co m p are o players. C om pa n y sh ou ld ap p oin t a serv ice en gine er in this reaso n to p custom er n eeds. A f te r s a le s s e r v i c e s h o u l d b e v e r y g o o d . C o . s h o u l d a p p o i n t a d eCa lheitto r aG tr a rh. 40
BHILWARA
•Total market as per dealers is 299 LAKH. •While total market perceived by dealers 333 LAKH •The region is expected to grow with 25% growth rate. •Customers Covered Are Using 84.2 Lakh LVSWGR Products •No. Of Customers Covered--17 •No. Of Dealers Covered--5
41
SUPPLIERS POLICIES SUPPLIER
SCHNEIDER
SIEMENS
MDS
L&T
G.E
ABB
REVENUE
26 LAKH
40LAKH
70 LAKH
DEALERS SALES PERSON SERVICE CENTER CREDIT PERIOD IN DAYS DISCOUNT OFFERED PROFIT MARGIN DELIVERY PERIOD IN DAYS FREQUENCY OF VISIT RESPONSE TIME TO COMPLAINTS
1 --
1 ---
1 ---
100 LAKH 1 ---
15 LAKH 1 ---
8 LAKH 1 ---
--
--
--
---
---
---
CASH
CASH
CASH
CASH
CASH
45
32%
32%
37%
45%
*
25%
*
*
*
5%
*
5%
10 TO 20
20 TO 30
15
3 TO 4
20
45
MONTHLY
MONTHL Y IMMEDIA TE
MONTHL Y IMMEDI ATE
15 DAYS
MONTH LY OK
MONT HLY OK
IMMEDIATE
IMMEDIA TE
42
