Abhay Asian Paints
Abhay Asian Paints
Abhay Asian Paints
For e.g. Nerolac has adopted strategy of Vertical Expansion by which Nerolac wants to improve its sale from Asian Paints monopoly outlets, means its monopoly outlets are being taken over by Asian Paints now in this condition to improve its sale Asian Paints need to open new outlets which is called Horizontal Expansion Strategy. A monopoly created through Horizontal Expansion is called a Horizontal Monopoly. This is the expansion of a firm within an industry in which it is already active for the purpose of increasing its share of the market for a particular product or service.
India is a big country having diversified taste and appearance and same character is reflected in their demography. Horizontal Expansion helps the company to serve the more people and more customers touch point because in the waste country many customers commute. Benefits of horizontal expansion: Provides Incremental Volume & Revenue for Business. By horizontal expansion there will be more outlets of our product In the market which will sell our product in more quantity. This will generate incremental revenue for the business. Helps Improve Route Productivity There are pre determined routes through which product is transported and delivered at the Asian Paints outlets. If we open more outlets on the routes it will increase the productivity because more outlets will be covered and more products will be delivered with a negligible increase in time and efforts. Hence it will improve productivity of the route Improves Profitability of Our Distributors Expenses on routes and delivery of product are incurred by the distributers. Opening new outlets will give more revenue to our distributors also. With the increase in route productivity will improve profitability of the distributors. Reduced Dependence on Large Customers, We know that Asian Paints products have a very good demand. To comply with this we have to provide large amount of supply. In case we have few outlets a large amount of stock is gathered at few retailers. In this case they become monopolistic and demand many things like hoardings and glowshine boards discounts margins etc. from the company. So it is very necessary to reduce dependence on large retailers by opening new outlets. Increase market visibility selling at more outlets give more market visibility of the product which gives higher product recognition and brand value to the products.
Economies of scale Economies of scope Increase in market power over supplier and downstream market channels.
Both expansion techniques are meant for increasing sales volumes. But in horizontal expansion company can earn more profits by spending less. Lets see the profit story of horizontal expansion
Above tables clearly indicate the importance of opening new outlets. By doing vertical expansion only growth in profit was not very effective but because of opening just 200 new outlets sales increased to a large extent. Total profit margin and return on investment also increased.
Story
Salesperson hello sir, I am from Asian Paints and I have a proposal that will surely increase your income. May I present you? Shopkeeper yes please present it Salesperson - Sir if you will start to sell Asian Paints then your overall sale will be increased and it is not tough to sell Asian Paints because Asian Paints is the leader in paimting industry and a very well known brand. Shopkeeper- yes, but how it can increase my overall sale? Salesperson - Sir, you are dealing in construction material. And these products have a very good combination with paints. If a person wants to purchase any of these products then it is quite possible that he will purchase Asian Paints and vice versa. Shopkeeper But how Asian Paints can increase my profit? Salesperson Sir if you are really interested to explore through asian paints, you may be able to sell it to the customer as you know that asian paint is the leading brand of painting industry ,and it gives a good emphasis on advertising so you need not to make any extra effort to sell it to the customer. Along with all this advantages our company also provide you the promotional tools like glow shine board, hoarding. And we will also provide you the home painting guide which will help you to make a long term relationship with your customer.
e.g. a car manufacturer merging with another car manufacturer. In this case both the companies are in the same stage of production and also in the same industry. A monopoly created through horizontal integration is called a horizontal monopoly. A term that is closely related with horizontal integration is horizontal expansion. This is the expansion of a firm within an industry in which it is already active for the purpose of increasing its share of the market for a particular product or service.
and related-linked types of diversification. Bic, the French Company, produces products such as disposable razors, cigarette lighters, and pens. The company pursues a related-constrained diversification strategy because all their products share significant commonalities in the areas of plastic injection molding, retail distribution, and brand name. Newell Rubbermaid is a good example of a related-linked firm. After Newell Company acquired Rubbermaid, the company is organized into five segments: cleaning and organization; home and family; home fashions; office products; and, tools and hardware. All five segments share common distribution channels supermarkets (such as Wal-Mart) and office supply stores (Staples, Office Depot, etc.). The products are sold under various brand names (Sharpie, Levolor) and do not typically share common technology or inputs across segments.
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1. To understand & explain the Horizontal Expansion Concept of the company. 2. To enlist the roles and responsibilities for Horizontal Expansion at retail end and its benefits. 3. To understand how to make The Horizontal Expansion Process more effective
Secondary Objectives:
1. To study the distribution system of the company. 2. To identify if there exists any training requirement for the improvement of sales to its sales team 3. To develop the business, expand the market coverage, acquisition of retailers, retention strategies and maintaining customer relations.
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1.
This project work is helpful in making a in-depth analysis of the horizontal expansion strategy of Asian Paints in Lucknow.
2. This project work will be helpful in conducting higher studies regarding the overall satisfaction of Asian Paints from the dealers perspective. 3. This report work will help the company to devise further marketing & sales strategies. 4. During my project I came to know about Narolac Marketing strategy that is the biggest competitor of Asian Paints.
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LIMITATIONS
Considering the fact that Nothing is perfect in the world, every individual is bound to make mistake at some points, and it is genuine. The study was restricted to Lucknow region only. Limited knowledge of the researcher in the field of research may lead to interpretation errors. The respondents may be biased or influenced by other factor. A busy schedule of dealers/ retailers also makes the collection of information a very difficult one. The project is purely based on observation & verbal meetings and may be influenced by unprecedented factors. Non-co-operative behavior of respondent was a big problem in this survey. . The research was based on primary collection of data through voice interview and observation so there may be chances of human error. The research was depending on the information provided by the respondents (retailers). It may insufficient. As associated with project, time and money were the major limitations with this project.
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RESEARCH METHODOLOGY
Data Collection
This research involved a study, which was descriptive in nature it basically aims at gathering data about how the Asian Paints red element concept &scheme playing in the mind of retailer & consumers. During the research period I collected data direct from retailers by survey. For proceeding further first of all we should know something about data and what the different type data are-
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ORIGINATED
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DATA .- DATA COLLECTED FOR SOME PURPOSE OTHER THAN THE PROBLEM AT
METHODS OF DATA COLLECTIONPrimary data collection: 1. Observation 2. Experiment 3. Survey But here, only surveys method of data collection is preferred which is very suitable to reach the researcher motto. A. Research instrument: Printed Questionnaire was used as the research instrument to collect the required information. B. Area of surveys: The survey was conducted at Lucknow. Primary data can be collected by three methods-
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SAMPLE DESIGN
Sampling unit: The retailer of construction material, hardware store and small level of builders was selected from different places of Lucknow. Sampling size: 150 Type of sampling: there are two type of sampling. 1.Probability sampling. 2. Non probability sampling.
Probability sampling- It is also known simple random sampling. In this sampling everybody gets similar chance to select as a sample unit.
Non probability sampling- In this sampling everybody gets not similar chance to select as a sample unit. Example of non probability are cluster sampling, convenience sampling, judgment sampling e t c.
Sampling procedure: Simple random sampling procedure was followed. Sampling method: Data were collected by retailer survey. The retailers are directly contacted and interviewed at their retail counter.
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CHAPTER-2
INTRODUCTION TO THE COMPANY
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Paint Industry
Paint industry estimated at Rs. 135bn. Unorganized sector accounts to 35% of paint market. Volume growth estimated at 15%. Indias share in the world paint market is 0.6%. Per capita consumption of paint in India is 1.2kg/annum.
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Asian Paints has always been ahead when it comes to providing consumer experience. It has set up a Signature Store in Mumbai & Delhi in India, where consumers are educated on colours and how it can change their homes. Vertical integration has seen it diversify into products such as Phthalic Anhydride and Pentaerythritol, which are used in the paint manufacturing process. Asian Paints also operates through APPG (50:50 JV between Asian Paints and PPG Inc, USA, one of the largest automotive coatings manufacturer in the world) to service the increasing requirements of the Indian automotive coatings market. Another 50:50 JV with PPG has been proposed which will service the protective, industrial powder, industrial containers and light industrial coatings markets International Presence Today the Asian Paints group operates in 17 countries across the world. It has manufacturing facilities in each of these countries and is the largest paint company in eleven countries. The group operates in five regions across the world viz. South Asia, South East Asia, South Pacific, Middle East and Caribbean region through the five corporate brands viz. Asian Paints, Berger International, SCIB Paints, Apco Coatings and Taubmans. The Group operates as:
Asian Paints in South Asia (India, Bangladesh, Nepal and Sri Lanka) SCIB Paints in Egypt Berger in South East Asia (Singapore), Middle East (UAE, Bahrain and Oman), Caribbean (Jamaica, Barbados, Trinidad & Tobago) Apco Coatings in South Pacific (Fiji, Tonga, Solomon Islands and Vanuatu) Taubmans in South Pacific (Fiji and Samoa)
The company has a dedicated Group R&D Centre in India and has been one of the pioneering companies in India for effectively harnessing Information Technology solutions to maximize efficiency in operations.
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Corporate Information
VISION
Asian Paints aims to become one of the top five Decorative coatings companies world-wide by leveraging its expertise in the higher growth emerging markets. Simultaneously, the company intends to build long term value in the Industrial coatings business through alliances with established global partners.
HISTORY
TODAY
Asian Paints becomes the 10th largest decorative paint company in the world Asian Paints is more than twice the size of its nearest competitor It is one of the most admired companies in India Present in 22 countries with 27 manufacturing locations, over 2500 SKU's, Integrated SAP - ERP & i2 - SCM solution Rated Best Employer by BT-Hewitt survey, 2000 Bluest of the blue chips by Hindu Business Line; Most admired company to work for by ET-BT survey, 2000 On the recommendations of Booz, Allen and Hamilton, Asian Paints restructured itself into Growth, Decorative and International business units and adopted SCM and ERP technology
Asian Paints aims to become the 5th largest decorative paint company in the world
1967
Asian Paints emerges as India's leading paint company ahead of any international competition.
1957 - 66
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British company Balmer Lawrie rejects the products of a giant British paint company in favour of Asian Paints. Asian Paints embarks on an ambitious grassroots marketing campaign, partnering with thousands of dealers in small towns all over India.
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Asian Paints touches a turnover of Rs. 3,50,000, with an innovative marketing strategy "to reach consumers in the remotest corners of the country with small packs."
Armed with little knowledge and great determination, Champaklal H. Choksey, Chimanlal N. Choksi, Suryakant C. Dani and Arvind R. Vakil get together to manufacture paint in a garage on Foras Road, Bombay. They name their company 'The Asian Oil & Paint Company', a name that they picked randomly from a telephone directory.
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BOARD OF DIRECTOR
Dr. S Sivaram
Mr. S Ramadorai
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Group Subsidaries
Apco Coatings is a subsidiary of Asian Paints in the South Pacific islands. Asian Paints operates in Australia, Fiji, Tonga, Solomon Islands and Vanuatu under the brand name of Apco Coatings.
Asian Paints Industrial Coatings Limited has been set up to cater to the powder coatings market which is one of the fastest growing segments in the industrial coatings market.
Website: www.bergeronline.com Few companies can claim of a history of consistent growth for over two and a half centuries, a presence in over 35 countries and an impact on the lives of over a billion people. Berger does that with elan. Ever since it was founded in England in 1760 by Lewis Berger, who perfected a new process for making Prussian Blue the colour of most military uniforms then, Berger has never looked back. Over the years Berger expanded its operations across oceans, to cover numerous geographies. In 1994, Berger units were brought under the single umbrella of the holding company 'Berger International Limited (BIL)' with headquarters in Singapore, which was also listed on the Singapore stock exchange. In November 2002, BIL became a part of the Asian Paints Group. Today, the name of Berger is synonymous with quality and innovation. BIL has presence across three regions viz. Middle East, Caribbean and South East Asia. In the Caribbean region, Berger is a household name. And considering that the company celebrated 50 successful years in the region recently, this is not surprising.
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Incidentally, Berger Paints Jamaica Limited, which is listed on the Jamaican stock exchange, is amongst the top ten companies in the country in terms of market capitalisation. In the Middle East too Berger is a well-respected brand. It is the largest paint company in Bahrain. Using its state-of-the-art manufacturing facilities there, and in United Arab Emirates, it exports to countries in the Commonwealth of Independent States, Gulf Cooperation Council and Africa. In South East Asia Berger enjoys a fine reputation and has operations in Singapore and Thailand.
Website: www.scibpaints.com Founded in 1979, SCIB Paints today is a reputed name and ranks amongst the top five paint companies in Egypt. SCIB Paints became a part of the Asian Paints group in August 2002
Website: www.asianppg.com Asian PPG Industries Limited, a joint venture between Asian Paints (India) Limited and PPG Industries, Inc. USA with 50:50 equity sharing was established in March 1997 with the objective of providing solutions to the paint requirements of Indian Automobile manufacturers. The joint venture brought together two leading companies with strengths in technology, manufacturing and customer insight.
Website: www.Taubmans.com.au Taubmans Paints Fiji, the fourth largest paint company in Fiji, became a part of the Asian Paints family in September 2003. Taubmans Paints is the dominant player in the project sales segment in the country and is a leader in the neighbouring SamoaIslands. It has two manufacturing facilities, one in Suva (Fiji) and the other in Samoa.
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COMPETITORS
International Operations
Evolution Phase Extension and Consolidation Phase The years of Excellence Moving Closer to the Consumer Changing rules of the game
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Market Share
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Key Strategies
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Reinvention
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During the late nineties the brand had to be reinvented because of increase in competition during festive season and also preference to other products during festival season. The choice of color became a high involvement decision. The company went in a for a brand overhaul. The logo was changed to a contemporary upmarket one designed by Enterprise IG based in Singapore. The logo/design was to convey self expression, sophistication and technology. Thus came the birth of a wonderful positioning strategy created by O&M. The insight was that the brand is about people and homes and homes reflect the people living in it. Hence Har Ghar Kuch Kehta Hai translated to Every Home has a story to tell. Their website is plays a key role in promotions. The famous hindi film actor Saif Ali Khan is the brand ambassador for their premium brand Royale.
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The new identity is expected to be rolled out over the next month at all the 5,277 critical retailer stores followed by the rest of the network. The change was inspired by research insights that showed that: Upward mobility of the urban middle class has been rising quite rapidly over the past several years which has resulted in a higher involvement and willingness to invest in home aesthetics. The emerging professionals group consisting of double-income professionals or younger influencers such as teenagers/young adults prefer design and dcor companies that assist the makeover process through color guidance, paint process guidance and related services. The home makeover process that includes tiling, upholstery, furniture, etc., cuts out a significant portion of the home owners budget. Hence, the paint category has immense potential to use color in an innovative and creative manner to provide more design and decor solutions than ever before.
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MANAGEMENT POLICY
MANAGEMENT DISCUSSION AND ANALYSIS:(2011-2012) The year began with several challenges both on the domestic and international fronts. The upheaval in Middle East, sovereign debt crisis in the European countries and weak recovery hopes for other developed economies threatened to derail the global economic environment at the beginning of the year. Additionally, India had its own set of challenges viz., inflation, interest rates and regulatory uncertainties. Amidst all these, however, there was a sense of optimism and hope that the environment would recover sooner than later and it was expected that the Indian economy would grow at around 8.5% on the back of strong domestic demand and a thrust on Infrastructure development. Reality, however, turned out to be otherwise. The macro-business environment during the year was characterized by uncertainty and volatility. The set of challenges which we began with either intensified or are still to be addressed. The sovereign debt crisis in Europe remains unresolved, USA saw a downgrade for the first time in the recent history and Middle East continues to face socio-political tensions. Expectedly, crude oil prices have remained firm during the year leading to commodity inflation across the board. The world has been trying to solve these problems or at least avoid any further aggravation, for quite some time now. The ground realities in India have not met the expectations either. The country is expected to have grown at 6.9%during the year against a growth of 8.4% registered in previous year. This in itself is an indication of the pressures being faced on the domestic front. Although disappointing, the fact that the country was battling near double digit inflation (mainly due to global cost push and agricultural supply constraints) cannot be ignored. Sticky inflation also led to a tight monetary policy which moderated growth during the course of the year. The impact was largely felt on the industrial sector whereas agriculture and services continued to do well. The rupee felt this pressure and breached the 50 level mark during the year, aggravating the concerns for importers. However, after remaining subdued for a better part of the year, some of the indices have started looking up. Inflation has started showing signs of easing and RBI has responded by cutting CRR and interest rates, signaling a softer regime going forward. It remains to be seen how the economy responds to these measures.
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In this uncertain environment, Company has made the best use of its resources and abilities to come out stronger from the tides. A lot to thank the outgoing Managing Director & CEO, Shri P.M. Murty for what the Company has achieved. His contribution to theCompany during his tenure needs no reiteration. The performance of your Company during FY 2011-12 is detailed below: 1. PRODUCTS AND MARKETS The Company operates in Decorative coatings and Industrial coatings segments across India and in the geographies of Asia, Middle East, Caribbean and South Pacific Islands through its subsidiaries and joint ventures. It has presence in 17 countries with 24 paint manufacturing facilities. The Paint industry volume growth in India during FY 2011-12 was strong across regions, albeit a bit lower than initial expectations. Margins in the industry were under pressure owing to surging inflation in input prices seen during the year. Industrial Paints business faced pressures due to the slowdown witnessed in the Industrial sector. Especially in automotive coatings, the markets didnt perform as was expected initially due to surging fuel prices and tightening interest rates. International business did well in spite of the regional turmoil in Middle East and subdued economic conditions in the Caribbean region. The Asian markets fared well owing to strong domestic demand conditions. Raw material inflation caused pressures on the margins of international units as well.
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The trend of high growth in emulsions and exteriors witnessed in recent years continued. This helped in registering a better mix and higher growth rates. Overall, the product mix offered by the Company is getting richer on account of good growth rates seen in emulsions, thus steadily reducing the dependence on enamels and distempers. The Company offers the broadest mix in the product portfolio to the customers and has successfully established its strength in the premium segment in the last few years. During FY 2011-12, the interior emulsion category continued to grow well on the back of good marketing work done in Royale (the new Teflon co-branding and the launch of the Shyne variant). Tractor Emulsion continues to grow extremely well, thereby, becoming the preferred Economy Emulsion in the market. The Exterior Emulsion category has strengthened with the inclusion of Apex Ultima and textured finishes in the portfolio. Asian Wall Putty has also been growing well in the recent past. Major thrust areas were identified to secure growth, ensure customer satisfaction, supply chain capability and capability building for the future during FY 2011-12. The Company continued to expand its sales network. The Colour World reach has now grown to over 21000 dealers. The 43 Colour Idea stores that have been opened so far continue to be an area of consumer delight. The concept would be expanded significantly over the next three years.
The Signature stores in Mumbai and Delhi (which was opened during the year) continue to attract a large number of consumers who respond very positively to the experience. Innovative marketing initiatives are being undertaken to increase consumer connect and awareness on painting. The Happy Painting Guide and Colour Scheme PRO (Mobile
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application enabling consumers to create colour combinations) that have been launched are a step in this direction. Samplers and Foresites service continue to receive a good response. Shop-boy and dealer training and other Critical Retailers specific initiatives are also being undertaken vigorously .With volumes doubling nearly every five years, Company needs to invest in capability to effectively implement its growth strategies. Work on the construction of the 7th Decorative paint plant at Khandala (Maharashtra) is progressing steadily and is on course for commissioning a capacity of 300,000 KL in fourth quarter of FY 2012-13.Rohtak plant (Haryana) produced 125,000 KL in its second year of operation. The capacity at Rohtak has been increased from 150,000 KL to 200,000 KL per annum and this capacity is now available from the first quarter of FY 2012-13.Construction of the Distribution Centre at Patancheru Plant is underway and by the end of FY 2012-13, all plants with the exception of the Bhandup Plant would have operating Distribution Centres allowing complete migration to the new Distribution Model. This new model is expected to facilitate higher service levels with lower levels of inventory going forward.
INTERNATIONAL OPERATIONS
FY 2011-12 was a challenging year for the overseas operations of the group. Most of the international markets where Company operates continued to be impacted by difficult market conditions. The political turmoil in Egypt and Bahrain continued and impacted demand. Bangladesh was impacted by sharp currency depreciation and a liquidity crunch in the market that has pushed up interest rates. The focus in the international operations of the group during the year was on strengthening position in the market place through initiatives to improve customer centricity, increasing the number of dealer tinting systems, introduction of new products, expanding the dealer network, increasing exports, focus on protective and industrial coatings segments and improving service level to minimize loss of sale due to stock outs. All these steps coupled with tight control on expenses and capital employed have helped the international operations of the group perform satisfactorily despite difficult market conditions. Sharp focus was accorded to further enhance safety standards in all subsidiaries. During the year, the subsidiaries in UAE and Trinidad were certified for ISO 14001. The revenue from paint sales of the overseas operations of the group for the year is ` 1138.6 crores as compared to ` 974.5 crores during the previous year. Material prices during the year saw an inflationary trend and profitability was impacted due to inability to take price increases commensurate with increase in material prices. The impact of inflation was mitigated to some
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extent by formulation re-engineering, economies of scale in purchasing and reducing losses in manufacturing. Profit after tax for the overseas operations of the group during the year is ` 72.3 crores as compared to ` 87.9 crores during the previous year. During the year, Asian Paints International Limited, Mauritius, a 100% subsidiary of your Company, declared its maiden dividend. The dividend received during the year amounts to US$ 3.4 million (equivalent to ` 15.8 crores) and royalty received during the year from overseas subsidiaries amounts to ` 15.2 crores. The revenue from paint sales of Berger International Limited, a subsidiary listed on the Singapore Stock Exchange has decreased by 1% to S$ 107 million (equivalent to ` 413 rores). The group operates in the following geographies:
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The Rohtak plant of your Company has implemented environmental management system and received the ISO 14001 certification. With this, all your Companys seven paint plants and the two chemical plants have the ISO 14001 environmental certification. All the seven paint plants and one chemical plant are Zero Industrial Discharge plants with rain water harvesting capabilities.
Khandala plant construction has begun and is progressing at fast pace. The design of the Khandala plant has world class safety facilities, Zero Discharge of effluents, water conservation, rainwater harvesting and green belt at the periphery of the premises.After achieving Zero Discharge of industrial effluent, minimization of waste through reduction at source and recycle/reuse has been a key focus area. This has resulted in reduction in specific generation of effluents and solid waste. Company also appreciates the need to monitor and reduce emission of Green House Gases (GHGs) which are responsible for global warming and climate change. Your Company has institutionalized a mechanism to monitor GHGs emissions across all business units as per Green House Gas (GHG) protocol [A Corporate Accounting and Reporting Standard by World Business Council for Sustainable Development]. GHGs emissions monitoring has been categorized under Scope 1 - Direct GHG emissions (due to fuel consumption) and Scope 2 Indirect GHG emissions due to electricity consumption (electricity bought from power generation companies) over which your Company has got direct control. Company has focused its efforts on enhancing energy efficiency in all its operations, right from the design
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of new manufacturing facilities. Company is participating in Carbon Disclosure Project (CDP) for disclosing information on carbon emissions.
3. HUMAN RESOURCES:
FY 2011-12 has been a year of consolidation for Human Resource function of Company. Several initiatives, which began in the previous year, started taking shape this year. Learnscape, People Review process and Employee Engagement are few such initiatives where noticeable consolidation over last years work were seen.While attracting and retaining talent continues to be a common challenge across industries in last few years, campus recruitment remains the most important source of getting right talent for Company. Therefore, in order to further improve Companys brand image at select campuses, initiatives towards increased industry-academia interface were focused upon. This in turn resulted in better quality talent attraction from specific campuses for Company. Customers are at the center of external interface, similarly, employees are the center of internal interfaces. In Company, several initiatives under Voice of Employeeagenda were taken up for implementation making a good beginning to responding to employee needs.
Inclusive participation and Inclusive growth is the core of any peaceful Industrial Relation. Building and working on comprehensive employee relations agenda has been an area of continued focus in Company. Accordingly,initiatives around Employee Relations and Engagement were taken up across all major manufacturing units.The formation of a new JV in the industrial business involved HR integration which included developing organization structure and policies to support the independent entity.A repertoire of courses available
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through e-learning is gaining momentum in Company which includes partnerships with reputed global organizations like Harvard Business Publishing and Skillsoft. These have received encouraging feedback from employees in Company.
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playground equipments to a primary girls school in Baliyana village. At Ankleshwar in Gujarat, Company is an active member of Ankleshwar Industrial Development Society, a trust which looks after Shree Gattu Vidyalaya, Shree Jayaben Modi Hospital, Mobile Education Van Project and Childrens theatre cum sports complexWhen the cyclone Thane struck Cuddalore and its neighbouring areas, essential provisions were distributed by the Penta plant to the cyclone affected villagers.
5. INFORMATION TECHNOLOGY:
There are four mega trends in the Information Technology(IT) world, shaping the way information is getting generatedand consumed today. These trends are Mobility, Social, Cloud Computing and Consumerization of IT. During FY 2011-12, Company has explored the impact of these trends and its relevance for your Company and deployed innovative applications around these mega-trends. A third generation cutting edge mobile application for the front line sales force of your Company was developed which will allow the territory officers to manage the dealer network efficiently by providing a 360 degree view of dealers. As this report goes to print, the application and associated devices are being rolled out pan India. Going forward the other customer facing roles of Company are also planned to be mobile enabled.The relevance of managing online reputation has gained immense significance in todays world. Company has already established its presence on popular social media platforms like Facebook and Twitter. To enable structured management of Companys online reputation, a social sentiment analytics tool was proto-typed and developed during FY 2011-12 , which can listen to opinions expressed by various consumers about Company and channel it to the Customer Relationship Management Systems.
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During the FY 2011-12, technology efforts have been focused on environmentally compliant technologies: 1. Water borne Acrylic Emulsion 2. Water borne Alkyds 3. High solids and 4. Low VOC solvent borne; VOC = Volatile Organic Compounds. The portfolio of projects includes leading edge technology for strengthening core business and overall capabilities.During FY 2012-13, Emulsions developed from Technology platform programs are expected to represent 20% of current total volume of emulsions. To meet the mid and long term strategic goals, focus will be in the area of developing paints with reduced VOC.
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Asian Paints has been included in the Forbes magazine's - Asia's Fab 50 List of companies once again. This is the second time that Asian Paints has been included in the coveted list.
In Feb 2012, Asian Paints wins the Asian Centre for Corporate Governance & Sustainability awards for the BEST GOVERNED COMPANY in 2011 Asian Paints included in Asia's Fab 50 List by Forbes Asia Magazine (Sept 2011 Issue) Asian Paints ranked 13th amongst the top paint companies in the world by Coatings World - Top Companies Report 2012 (July 2012 Issue) Mr. P M Murty, MD & CEO, Asian Paints conferred upon the 'CEO of the Year' award by Business Standard, one of India's leading business daily (March 2011) Asian Paints receives the Best Audit Committee Award from the Asian Centre for Corporate Governance & Sustainability (Feb 2011) Awarded the "Sword of Honour" by the British Safety Council for all the paint plants in India. This award is considered as the pinnacle of achievement in safety across the world.
Forbes Global magazine, USA ranked Asian Paints amongst the 200 'Best Small Companies of the world' in 2002 and 2003 and amongst the top 200 'Under a Billion Firms' of Asia in 2005.
The Asset - one of Asia's leading financial magazine ranked Asian Paints amongst the leading Indian companies in Corporate Governance in 2002 and 2005. Received the Ernst & Young "Entrepreneur of the Year - Manufacturing" award in 2003.
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InterpretationThrough the above diagram we can know that out of 150 outlets how many outlets are construction, builders and hardware outlets. Thus we can conclude that 40% outlets were hardware, 20% were builders,40% were construction material outlets.
2. Type of Outlet
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Outlets NAROLAC Asian Paints Both Asian Paints and Nerolac Paints OTHERS
Response 30 30 30
Percentage 20 20 20
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40
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Highly satisfied Quite satisfied Neither satisfied nor dissatisfied Quite dissatisfied Highly dissatisfied
18 57 24 39 12
12 38 16 26 8
InterpretationThrough the above diagram we can know the level of satisfaction on communication from the company. Out of 150 outlets,18 are highly satisfied,57 are quite satisfied,24 are neither satisfied nor dissatisfied,39 are quite dissatisfied and 12 are highly dissatisfied
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Go for other brand Call to distributer Call to companys sales person Stop selling that brand Other outcomes
96 0 39 15 0
64 0 26 10 0
InterpretationThrough the above diagram we can know what the retailers do if a brand they prefer is not deliver to them. Out of 150 outlets, 96 of them go for other brands, 39 of them call to the company`s sales person and 15 of them stop selling that brand.
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promotions
Responses
Percentage
scheme Case refund Price pack Home Painting Guide Any others
63 21 12 54 0
42 14 8 36 0
70 60 50 40 30 20 10 0 scheme Case refund Price pack Home Painting Guide Any others
Interpretation:Through the above diagram we can know the promotion that affect brand mostly. Out of 150 respondents 63 replied schemes, 21 case refund,12 price pack and 54 under crown scheme.
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InterpretationThrough the above diagram we can know the effect on sales in the occasions of festive season( peak seasons). Out of 150 responses 21 said that the sales increase, 18 said that the sales decrease, 66 said that there is no effect on sales on festive and 45 did not answer.
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Response 42 15 69 24
Percentage 28 10 46 16
InterpretationThrough the above diagram we can know the effect on sales in the occasions of non festive . Out of 150 respondents 42 said that the sales increase, 15 said that the sales decrease, 69 said that there is no effect on sales on non festive seasons and 24 did not answer.
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Findings
1. It is felt that outlet owner are more concern about schemes like offers on cases,and promotional schemes etc and nerolac is providing them better schemes than asian paints. 2. It is felt that distributor is not doing his work honestly, he is not sending route in the market properly. When the salespersons generate orders with retailer, due to problem like salesman is on leave, vehicle is not available etc they delay the order and retailer cancel the order with the distributer that affects the sales volume. 3. Distributer is more concern about Wholesaler rather than Retailer.
4. The distributor in its area is facilitating sales by establishing monopoly of offers and schemes that do not reach to the outlet. 5. Due to infiltration, difference in the rates for the shopkeepers has been perceived as a major problem in the market. 6. Distributor rarely keeps any interest to work and communicate with the customer which results in of the companys sales as well as image are getting adversely affected.
7. It has been found that the shopkeepers has strongly responded to the option of switching to the another brand, when it has been inquired that what will they do in order to continue trading at the time when their preferred brand is not been delivered properly
8. The shopkeepers have nodded to the view that schemes offered to them as per the policies of the company plays a significant role in increasing profitability. As per the notes taken apart from the data in the questionnaire it has been discovered that nerolac offers more schemes to the shopkeepers who are vindictive for the company.
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9.. Some outlets are maintaining old price strips and also these are not easily visible to the customer.
10. I found that some retailer were not satisfied with our service, for that reason they stopped to sell our product and started to sell nerolac product.
11. I found that nerolac is doing aggressive advertisement in comparison with asian paints, and investing aggressively on activation like hording, glow sign board, also in terms of providing good service and free advertising equipment to the retailer.
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Company should convince retailers to have promotional tools decorating with Asian Paints products and should tell them why these elements are important and how company as well as Retailers is getting benefit of using these activation elements. Company should focus more and more on builders because most of the builders dont have promotional tools of the company and overall average score of these is very less. Company should reframe the Flange to an attractive and big size because the current look and size of Flange is not attractive and fail to draw attention of the population. Overall service should be improved because many of the retailers are not satisfied with company service. Company must provide free promotional equipment to the outlet where needed and also company should work out on the complain of Retailers. The Company should measure Retailers satisfaction regularly and should maintain proper communication with them. Company can increase the sales when it considering more on retailers, their suggestions or complaints about service or product so that necessary action can be taken. Review meeting should be often held so that the working pattern of the executives can be checked and improved if needed. Company representatives should visit retailers and should make a long-term relationship with retailer so that they can push the product. Distributers should be convinced to pass the incentives to the retailers so that they aremotivated to promote this brand. Increase the number of dealers and retailers as this will help in making high sales volume.
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In Season Company should give more discount & schemes to retailers so that they sell more our product.
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Conclusion
No other company is planning to increase its capacity in the near future; this will give Asian Paints a competitive advantage in terms of pricing.
Growth rate of two important activities i.e. repaints activity and construction activity will have direct impact on the volume of demand, thus affecting its profitability and margins. Rural markets have devloping potential. Companies that can establish a dealer network in these markets are likely to get the edge in positing above par growth rates over the next few years.
As setting up distribution infrastructure is expensive, it would mean that the competition is limited to the top players. Due to substantial hike in raw material prices, Asian Paints has raised the prices of solvent based paints, thus demand would be affected to some extent.
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BIBLIOGRAPHY
1. Nargundakar- Marketing Research (All India Traveler Book Sellers) 2. Malohotra,Naresh K. & Das, S.- Marketing Research (PEARSON)
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4. Anonymous, How to decide who should get what data, H.R.Focus(May 2001)
5.
Thorburn, David and Jenkins, Henry (eds)(2002). Rethinking Media Change, MIT Press, Cambridge, Massachusetts, pp.283&284.
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Personal information
Name:Area:Mobile no.:(1) What Type of Channel do you hold? a) construction material c) builder b) hardware d)Other,Please specify .
(2) What Type of outlet are you in? a) Nerolac Exclusive c) Never sell oil and apints b) Asian Paints Exclusive d) Both a & b
(3) What is the promotional equipment you are using? a) Glow shines board c) Own yourself hoardings e) Both (A & B). (4) Kindly rate the level of satisfaction on Communication from the company a) Highly satisfied c) Neither satisfied nor dissatisfied e) Highly dissatisfied b) Quite satisfied d) Quite dissatisfied b) Hoardings d) Banner
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5) If a brand which you prefer is not delivered to you properly, then what do you do? a) Go for other brand c) Call to companys sales person b) Call to distributer d) Stop selling that brand
(6) Which of the following promotions affect the sale mostly? a) Scheme c) Price pack b) Case refund d)Home Painting guide
(7) I. Is there any effect on sale of ASIAN PAINTS in festive season? a) Increase c) No effect b) Decrease d) Cant say
(8) Is there any effect on sale of ASIAN PAINTS in non-festive season? a) Increase c) No effect b) Decrease d) Cant say
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