Entry Stratergy of Dabur
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Transcript of Entry Stratergy of Dabur
Group 3
DABURUSP: NATURAL AND AYURVEDIC FMCG PRODUCTS.
• It was founded in the year 1884 by Dr. S K Burman
• Dabur is a Public ltd Ayurvedic company and has its headquarters in Ghaziabad
• It has two hundred and fifty products. Popular brand with outlets in Africa, Europe, United States, Russia, SAARC Countries and Middle East Countries
• Product categories are oral care, hair care, skin care, food products, health and home-care products
• The prices are kept minimum so that people can buy natural products which are healthy
• Distribution Network : 2.8 million retail outlets
Maximizing Shareholder’s WealthShareholders wealth
Profitability
Reduce cost
Add value & Increase cost
Profit growth
Sell more
Expansion
Netherlands
Government subsidies to ayurvedic and natural
products.
European union is the biggest market with the share 45% of
total herbal market.
Access to portsOne of the world’s best agricultural countries
World’s 4th best logistics performance
Base for EU countries
Source: http://lpi.worldbank.org/international/global?sort=asc&order=Infrastructure
Global Standardization Strategy
Localization
Transnational Strategy
International Strategy
Pressure of local responsiveness
Cost
Pre
ssur
e
High
High
Low
ENTRY STRATEGY
LEGAL COSTS
BUREAUCRACYRED TAPISM
INFRASTRUCTURE COSTS
UTILITYWAREHOUSING
TRANSPORT
COST ANALYSIS
Number of days for processing: 4 days
Average number of procedures to be followed: 4/10
Land, labor, electricity, gas, inbound and outbound freight
Source: http://www.heritage.org/index/ranking
BENEFITS Increase in employment Increase in purchasing
powerIncrease in disposable income
RISK• POLITICAL RISK: LOW Democratic
• LEGAL RISK: LOW Civil Law
• ECONOMIC RISK: LOW Sustainable GDP And PPP BREXIT
• TIME: FOLLOWER • SCALE: LARGE SCALE• HOW: GREENFIELD INVESTMENT
ENTRY STRATEGY
Demand for ayurvedic products increasing 4.6%
Porter’s Diamond Model
Firm Strategy, Structure And Rivalry
Demand Conditions
Related And Supporting Industries
Factor Endowments(Basic And Advanced)
Land , Labor, Capital, Proximity To Raw Materials. Research Facilities,
Infrastructure, Logistics, Namaste labs, Machinery.
Domestic Demand
Strong Competition From:•Online Websites•Maharishi Ayurveda
Source: http://www.heritage.org/index/rankinghttp://lpi.worldbank.org/
Frequent buying customersAll age groups
Dabur India. 4th largest FMCG company in India. Operations in
several countries. Purchased Namaste Lab.
Maharishi Ayurveda Products Pvt. Ltd. incorporated in 1986
It is the major player in Netherlands
Political stabilityEmerging middle class
populationEmerging of latest technology
Ayurveda is acceptable culturally
Access to key ports, airways, and railways.(ESSAR)
Developing strong alliances with suppliers/wholesalers
CUSTOMER
CLIMATE
COLLABORATION
COMPANY
COMPETITOR
5C ANALYSIS
MARKETING PLAN
1. Fragmented and concentrated
2. Channel length – long ( we will be selling through Albert Heijn, Jumbo)
3. Channel quality – HIGH : due to these international retailers
4. Channel exclusivity is very low
Distribution strategy
1.Cultural barriers – minimum
2.Source and origin effects –India’s brand image as the ayurveda and herbs hub
3.Pull strategy and push
Communication Strategy
POSITIONING
• Ayurvedic FMCG
• Affordable Product
• Trusted household name
Target
Age : All age group Income : low and
middle income group Occasion of Usage :
Regular + Health conscious people
Advertising strategy
TelevisionRadioNews paperDigital marketing
Pricing strategy
Competitive pricing
SEGMENTATION
• Demographic• Geographic• Psychographic• Behavioural
Make/buy Facility Suppliers Wholesalers/ distributors/retailers
Logistics
Make Location:
Tilburg
Near to
Rotterdam port
Export port :
Hyderabad, Nhava
Sheva sea,
Sabarmati icd
Entry port :
Rotterdam
Shipping partner:
ESSAR
•Vetrivel herbals•Govardhan enterprises•Jay jalaram•Raj & company•Dabur’s own cultivation
Unstructured
•Udea•Natudis•Odin•Other retail outletsStructured•Jumbo•Albert heijn
Technology
Daburnet : currently in Egypt, Nepal, UAE, India
Expand for EU with headquarters in netherlands
Operations plan
• Ranked No. 2 in the world for overall logistics performance
Source:http://biz.allyface.com/india/suppliers/biz-dabur
HR PLAN
Consumer Care
Foods & Beverage
Consumer Health Care
Dabur Asia Division
Dabur Africa
Division
Dabur N America
Division
Dabur Europe Division
Organizational Structure
Staffing Policy
Poly Centric Policy
Global Matrix
Control Mechanism
Bureaucratic
Headquarters:India
FINANCIAL PLAN
I. Infrastructure
II. Working capital
III. Operating expenses
Purpose of funds
Capital structure
debt equity
Source of funds BondsBank loans
Cost of debtLoan- 1.36%Bond-2.2%
Source of funds
Risk mitigation – Hedging, Letter of credit
Risk transfer - Insurance
Risk acceptance – R&D, Forex fluctuations.