1
A STUDY ON DEALER SATISFACTION OF CROMPTON
GREAVES PREMIUM DECORATIVE CEILING FANS IN
ERNAKULAM DISTRICT
A report on the Project Work submitted in partial fulfillment of the
requirements for the MBA ( Full time ) Degree of the Mahatma
Gandhi University
Submitted by
Vinil Steephen P
Reg . No . 31306
2011 - 13 Batch
FISAT BUSINESS SCHOOL
Hormis Nagar, Angamaly
Cochin – 683577
July 2013
2
Date :- 07 /11/ 2013
CERTIFICATE
Certified that the Project Work entitled “A STUDY ON DEALER
SATISFACTION OF CROMPTON GREAVES PREMIUM
DECORATIVE CEILING FANS IN ERNAKULAM
DISTRICT“inCROMPTON GREAVES LIMITED – COCHIN BRANCH is a
bona-fide work done by VinilSteephen P during the period June 3 , 2013 to
July 31 , 2013 under my supervision and guidance.
Dean and Director Faculty Guide
FISAT Business School SABU MANGALASSERRIL
( Professor )
FISAT Business School
3
ACKNOWLEDGEMENT
First and foremost, I thank the lord almighty for his perpetual showers
blessings, which led to the successful completion of my project. It gives me
immense pleasure to present this report.
I take this opportunity to express my deep sincere of gratitude to all those
who have helped me throughout this organizational study. It gives me
immense pleasure to acknowledge all those who have rendered
encouragement and support for the successful completion of my work.
I am also thankful to Dr, P A MATHEW, (Dean & Director , MBA)
FISAT BUSINESS SCHOOL for his whole hearted co-operation in bringing
out this project..
I also take this opportunity to express my sincere gratitude to Mr. SABU
MANGALASSERRIL, my faculty in charge who has helped me throughout
this project.
I would like to convey my sincere gratitude to Mr A.G. Ramesh,(Branch .
MANAGER) CROMPTON GREAVES LIMITED, for giving me an
opportunity to do my study in such a reputed organization. I also extend my
sincere gratitude to Mr. RAJEEV S.(Engineer In-charge) for helping me
in this project by giving proper directions and suggestions.
Finally, I am very thankful to all my parents, friends, other staff members of
Crompton Greaves Limited Cochin Branch and faculty members whose
cooperation and suggestions have helped me in successful completion of this
project. Above all, I would like to thank God Almighty without whose
blessings this project would not have been a reality.
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5
DECLARATION
I hereby declare that the Research Report entitled ―A STUDY ON
DEALER SATISFACTION OF CROMPTON GREAVES PREMIUM
DECORATIVE CEILING FANS IN ERNAKULAM DISTRICT‖ is a
record of bona fide work done by me in ―Crompton Greaves Ltd.‖, during
―03/06/2013 to 3/08/2012‖ under the supervision of Mr. RAJEEV
S.(Engineer in-charge) CROMPTON GREAVES LTD and Mr SABU
MANGALASSERRIL , FISAT BUSINESS SCHOOL, and that no part of
this report has formed the basis for award of any degree, diploma,
associateship, fellowship or any other similar title or recognition in any other
institution.
Place : Hormis Nagar
Date : VINIL STEEPHEN P
6
Table of Contents
Sl.No. Content Page No.
1 EXECUTIVE SUMMARY
CHAPTER 1 INTRODUCTION TO THE STUDY
1.1
1.2
1.3
1.4
1.5
Introduction
Importance of the study
Organization selected for study
Objectives of the study
Scope of the study
2
2
2
3
4
CHAPTER 2 RESEARCH METHODOLOGY
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
Research design
Details of Data collection
Research period
Research instrument
Sample design
Tools for data analysis and interpretation
Hypothesis of the study
Limitations of the study
5
5
5
6
6
7
9
10
CHAPTER 3 INDUSTRY, COMPANY AND PRODUCT PROFILE
3.1
3.2
3.3
Industry profile
Company profile
Product profile
11
16
23
CHAPTER 4 REVIEW OF LITERATURE 30
CHAPTER 5 THEORETICAL FRAMEWORK 33
7
CHAPTER 6 DATA ANALYSIS AND INTERPRETATION
6.1
6.2
Data Analysis And Interpretation
Statistical Analysis
40
66
CHAPTER 7 FINDINGS, SUGGESTIONS AND CONCLUSION
5.1 Findings
5.2 Suggestions
5.3 Conclusion
82
84
85
BIBLIOGRAPHY
QUESTIONNAIRE
8
List of Tables
Table No. Content Page. No.
1 Sector wise fan production 13
2 Experience in selling Crompton greaves products 40
3 Dealing with competitors 41
4 Use of advertisements 42
5 Pattern of advertisements 42
6 Factors affecting dealer satisfaction. 45
7 Opinion about the brand Crompton greaves 47
8 Opinion about quality of Crompton greaves
decorative fans
48
9 Opinion about margin of Crompton greaves
decorative fans
50
10 Opinion about promotional activities of Crompton
greaves
52
11 Most preferred type of promotional activity 54
12 Opinion about timely delivery of Crompton
decorative fans
56
13 Opinion regarding employees of Crompton greaves 57
14 Opinion regarding after sales service of Crompton
decorative fans
59
15 Opinion regarding availability of Crompton
decorative fans
60
16 Areas for boosting premium decorative fan range. 62
17 Overall opinion of dealer satisfaction of Crompton
decorative fans
64
9
List of Figures/Graphs/Charts
Sl No. Content Page No.
1 Transformers & Reactors 24
2 Switchgear Products 24
3 Industrial Systems 25
4 Rail Control & Coach Products 26
5 Celling Fans 27
6 Industrial Fans 28
7 Experience in selling Crompton products 40
8 Dealing with competitors 41
9 Use of advertisement 43
10 Pattern of advertisements 44
11 Factors affecting dealer satisfaction. 46
12 Opinion about the brand Compton greaves 47
13 Quality of Crompton greaves decorative fans 49
14 Opinion about margin of Crompton greaves
decorative fans
51
15 Opinion about promotional activities of Crompton
greaves
53
16 Most preferred type of promotional activity 55
17 Opinion about timely delivery of Crompton
decorative fans
57
18 Opinion regarding employees of Crompton greaves 58
19 Opinion regarding after sales service of Crompton
decorative fans
60
10
20 Opinion regarding availability of Crompton
decorative fans
61
21 Areas for boosting premium decorative fan range 63
22 Overall opinion of dealer satisfaction of Crompton
decorative fans
65
11
EXECUTIVE SUMMARY
12
Crompton Greaves Ltd is one of the world's leading engineering
corporations. Their unique and diverse portfolio ranges from transformers,
switchgear, circuit breakers, network protection & control gear, project
engineering, HT and LT motors, drives, lighting, fans, pumps and consumer
appliances and turnkey solutions in all these areas; thus enhancing the many
aspects of industrial and personal life. The company operates in four segments:
Power Systems, Consumer Products, Industrial Systems and Others. The Power
Systems include transformer, switchgear, turnkey projects and power Supervisory
control and data acquisition systems (SCADA). The Consumer Products business
supplies fans, lighting equipment (light sources and luminaires), pumps, and range
of electrical household appliances and provides solutions for integrated security
systems, home automation and street lighting.
Dealers play a very important role in supporting the business activities of
any company. For any company dealers‘ satisfaction is a key marketing tool. It not
only helps in framing the marketing strategy, but also an important part of the
industry as far as its existence is concerned. Dealers play an important role in
market growth, diversification of products, market modification and above all
retaining the customers in their custody. In today‘s economy dealers face a vast
array of products, brand choices prices. These situations put pressure on the
companies to measure and understand new ways in which their existing dealer
chain can be retained.Companies cannot ignore in designing long term growth-
oriented policies, strategies aimed at dealers‘ satisfaction.
The study titled ―A study on dealer satisfaction of Crompton greaves
premium decorative ceiling fans in Ernakulam district‖is about understanding the
satisfaction level of Crompton greaves decorative fan dealers towards the company
dealership. Considering the fact that the way in which a dealer is treated by its
manufacturer has decisive influence on the dealer‘s commitment to the brand as
well as on the dealer‘s business success, an examination of dealer satisfaction or
dissatisfaction has become strikingly important during the last few years. For this
purpose a questionnaire has was developed with the aim to study the Dealer
Satisfaction of Crompton Greaves premium decorative fans in Ernakulam District.
Another objective of this questionnaire was to identify and evaluate the various
factors which influenced the dealer satisfaction with regard to Crompton greaves
decorative fans to provide a result concerning satisfaction or dissatisfaction of all
dealers with regard to Crompton greaves premium decorative ceiling fans..The
analysis part consists of Percentage analysis,Chi– Square Analysis,and use of
Statistical packagesThis project gives suggestions for improvement.with respect to
the findings from the study.
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CHAPTER 1
INTRODUCTION
14
1.1INTRODUCTION
Every company considers dealer satisfaction as a goal and marketing tool.It is not
only a decisive component in framing the marketing strategy, but also an inseparable
part of the industry as far as its existence is concerned. Dealer satisfaction also plays an
important role in market growth, diversification of products, market modification and
above all retaining the customers in their custody. Further, companies cannot perform
the competition only if they can go about winning dealers by meeting and satisfying their
needs because today‘s dealers face a vast array of products, brand choices prices. In such
an environment it is quite natural that dealers estimate which company‘s offer will
deliver them the maximum profit or satisfaction.
1.2 IMPORTANCE OF THE STUDY
Companies manufacture products according to the consumers‘ needs and
preferences, but the products reach the final consumers through the dealers, hence it is
very much essential for the manufacturers to ensure whether their dealers are able to
fulfill their roles effectively and to check the performance of its dealers periodically
.Understanding of these factors will help the companies to make the prompt action to
make product improvements on time and hence grab more market. For doing this,
company needs adequate information so that it can further improve the performance of its
dealers thereby improving its sales and profit .Company can get the necessary
information from the market by conducting a market research on the perception of the
dealers. This research is a genuine effort to understand the dealer satisfaction levels on
Crompton Greaves Premium decorative ceiling fans. This will enable the company to
enhance or modify their image and value in dealer‘s minds.
1.3 ORGANIZATION SELECTED FOR THE STUDY
The company selected for the study was Crompton Greaves Ltd. It is one of the
world's leading engineering corporations. Their portfolio ranges from transformers,
switchgear, circuit breakers, network protection & control gear, project engineering, HT
and LT motors, drives, lighting, fans, pumps and consumer appliances and turnkey
solutions in all these areas; thus enhancing the many aspects of industrial and personal
life. The company operates in four segments: Power Systems, Consumer Products,
Industrial Systems and Others. The Power Systems include transformer, switchgear,
turnkey projects and power Supervisory control and data acquisition systems (SCADA).
15
The Consumer Products business supplies fans, lighting equipment (light sources and
luminaires), pumps, and range of electrical household appliances and provides solutions
for integrated security systems, home automation and street lighting. The Industrial
Systems include electric motors, alternators, drives, traction electronics and Crompton
Greaves brought the electric fan tothe Indian sub-continent.The company – earlier known
as CromptonParkinson Works – manufactured its first ceilingfan in 1937 at Worli,
Mumbai. It later diversifiedinto table- pedestal- wall-mounted- exhaustedindustrial-fans.
.The fans division has been winning the market race for over a decade.CG is the largest
fan manufacturer in India, manufacturing fans like Ceiling fans, Table fans, Wall
mounting fans, Pedestal fans, Exhaust fans, Industrial fans for various applications of air
delivery- be it domestic or industrial. CG is a leading fan exporter to countries like USA,
Italy, S. Africa, Ghana, Fiji, Singapore, Bahrain, UAE, Sri Lanka, UK, France, etc.
1.4OBJECTIVES OF THE STUDY
The objectives of the study are mainly classified into two types;
Primary :
To identify the level of satisfaction of Crompton Greaves Premium decorative
range fan dealers and to measure the factors influencing the dealers to deal with
Crompton Greaves.
Secondary:
To identify the pattern of advertisement followed by the dealers.
To find out how the dealers rate the brand Crompton greaves.
To know how the dealers rate the quality of premium decorative range fan of
Crompton Greaves.
To find out how the dealers rate the promotional activities carried down by
Crompton greaves.
To know the impact of after sales service provided by Crompton greaves and the
satisfaction level of the dealers
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To know dealers opinion regarding the availability of Crompton decorative fans.
To find out the areas of dealership that needs improvement with respect to
Crompton Greaves decorative fans.
1.5SCOPE OF THE STUDY
Study is confined to selected dealers of Ernakulam District
To know dealers satisfaction level regarding Premium Decorative range fans
To know the expectations and minds of dealers
The study highlights the scope for future improvements on the basis of present
scale.
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CHAPTER 2
RESEARCH METHODOLOGY
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2. RESEARCH METHODOLOGY
2.1Research design
The Research conducted is descriptive in nature. Questionnaires were used to
collect the data through a field survey. Descriptive Research mainly involves surveys and
fact finding enquiries of different kinds. The main objective of research is to describe the
state of affair as it exists at present. Even though variables are beyond the researcher‘s
control he can report what is happening or happened and also discover the causes.
The research design is the conceptual structure within which research isconducted; it
constitutes the blueprint for the collection, measurement andanalysis of data. The data
was collected from 75 dealers from Ernakulam district.A scheduled questionnaire was
used to collect primary data on the otherhand; secondary data was collected using books,
magazines and websites.Graphical tools including bar diagrams, pie charts and statistical
tools which included percentage& chi-square analysis were used in the process ofanalysis
and interpretations of the collected data.
2.2 Details of Data collection
Primary data
The primary data was collected using questionnaire, the questionnaire comprised
of 17 question each with open-ended questions, multiple choice questions and
dichotomous questions
Secondary data
The secondary data was collected through company brochures, management
books, market research books, websites etc.
Area covered
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The study was conducted with the dealers in Ernakulam district who sold
Crompton greaves Premium decorative ceiling fan models.
2.3 Research period
The research period was from ―03/6/2013‖ to ―05/8/2013‖
2.4 RESEARCH INSTRUMENT
Research instrument used for data collecting is questionnaire. Questionnaire
preparation is one of the most challenging tasks of conducting a research.The
questionnaire is the backbone for obtaining data during survey. The questionnaire is
prepared in well-structured and non- designed form so that it is easily understandable and
answerable by everyone.The type of questions included in the questionnaire are Open
ended Questions, Multiple choice questions and Dichotomous question.
Open ended questions
Open ended questions require the respondents to provide his/her own answer to
the question. This is referred as a free response to collect the primary data.
Multiple choice question
A multiple choice question requires the respondent to choose an answer from
among the list provided in the questionnaire. Therespondents may be asked to
choose the most apt answer for the question.
Dichotomous Question
Dichotomous Questions allow the respondents to choose on from two extreme
responses like Yes/No, Agree / Disagree etc.
2..5 SAMPLE DESIGN
A research design is the agreement made to collect and analyze the data in a
manner that aims to combine the relevance to the research purpose with economy in
procedure. It constitutes the blue print for the collection, measurement and analysis of
data.Sample design is the way of selecting the sample, in other words a sample design is a
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definite plan determined before any data are actually collected for obtaining a sample
from the given sampling frame.
Population
All dealers dealing with Crompton Greaves Premium decorative ceiling fans in
Ernakulam district are coming under the population of the study.
Sample size
Sample size was taken as 75 dealers from Ernakulam district.
Contact Method
The method used to contact the respondents was direct personal interview. For
conducting the personal interview a structured questionnaire was prepared.
Sampling Method
The sampling method used for this study is non-probabilistic judgment sampling,
in this type of sampling procedure, the sampling unit selected for the collecting the
information is based on the judgment of the researcher. A judgment sample is a sample,
which a researcher purposively draws from the population which he thinks is a
representative of the population.
2.6 TOOLS FOR DATA ANALYSIS AND INTERPRETAION
The researcher carries out analysis through various statistical tools . The
statistical analysis is useful for drawing inference from the collected information. . The
statistical analysis and interpretation has been using the following tools:-
2.6.1 PERCENTAGE ANALYSIS
After the data is collected , it is then recorded , tabulated and edited accurately.
Here percentage analysis test is applied for analyzing and interpreting the data. It is an
important test of significance developed by statistician. As a known Para metric test, It
can be used to determine whether the categorical data shows dependency or if they are
independent.
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2.6.2 CHI-SQUARE ANALYSIS
Pearson‘s Chi-square test is the best known of several Chi-square test. Statistical
procedureswhose results are evaluated by the reference to the Chi-square distribution. It
tests a null hypothesis, that the frequency distribution of certain events observed in a
sample is consistent with a particular theoretical distribution.
Chi-square test, χ2 = ∑ (Oij-Eij) 2∑ij
Where, O= Observed frequency
E = Expected frequency
Degree of freedom (D.F) plays an important part in using the chi-square distribution and
tests are based on it. The degree of freedom is worked out as follows.
D.F = (c-1) (r-1)
‗C‘ represents number of columns and ‗r‘ represents number of
rows.
2.6.3 SPSS
Statistical packages are computer programs written for statistical analysis. These
programs have simplified the work of researchers who have to do statistical analysis in
their research work. Many statistical packages known as SPSS, MSAT, INDOSTAT,
MINITAB, EXCEL etc. are now developed for statistical analysis. These packages are
useful in employing most of the statistical techniques like calculating averages, standard
deviation, coefficient of correlation, regression, equation etc. and conducting statistical
tests like t-test, f-test and chi-square test. SPSS for windows is a relatively
comprehensive package for use in economics, business and research.
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2.7HYPOTHESIS OF THE STUDY
• Hypothesis 1
H0 : Brand name does not affect the overall satisfaction.
H1 : Brand name does affect the overall satisfaction.
• Hypothesis 2
H0 : Product quality does not affect the overall satisfaction.
H1 : Product quality does affect the overall satisfaction.
• Hypothesis 3
H0 : Credit period does not affect the overall satisfaction.
H1 : Credit does affect the overall satisfaction.
• Hypothesis 4
H0 : Promotional activities does not affect the overall satisfaction.
H1 : Promotional activities does affect the overall satisfaction.
• Hypothesis 5
H0: Timely delivery of goods does not affect the overall satisfaction.
H1: Timely delivery of goods does affect the overall satisfaction.
• Hypothesis 6
H0 :Employee interactions with the dealer does not affect the overall satisfaction.
H1 Employee interactions with the dealer does affect the overall satisfaction.
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• Hypothesis 7
H0 : After sales service does not affect the overall satisfaction.
H1 : After sales service does affect the overall satisfaction.
• Hypothesis 8
H0 : Availability of products during season does not affect the overall satisfaction.
H1 : Availability of products during season does affect the overall satisfaction.
2.8LIMITATIONS OF THE STUDY
Any research study will be restricted in scope by particular inherent limitations
that are participated by the choice of the research design, sampling procedure and
respondent selection. This study has the following limitations:
Since the survey was done only in Ernakulam district the result obtained
may not be taken as a universal suggestion.
Quality of the information highly dependent on the knowledge of the
respondents.
Dealers opinion is susceptible to change.
Time for the study was major constraint as the study was within a period
of 8 weeks.
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CHAPTER 3
INDUSTRY, COMPANY AND
PRODUCT PROFILES
25
3.1 INDUSTRY PROFILE
Electric equipment’s
The electrical equipment industry comprises several products such as
transformers, switchgears, motors and control equipment. In 2009-10, the size of the
electrical equipment industry stood at Rs 525 billion. The electrical equipment industry
grew at 11.3 per cent during 2009-10. The main buyers of electrical equipment are
powerutilities. A typical electric equipment component has a life of 20-25 years; hence,
replacement demand would incrementally add to the growth opportunities. The raw
Material cost of electrical equipment manufacturers is estimated at 50-60 per cent of
sales. Primary raw materials include copper, aluminum and steel. A few large players
dominate the electrical equipment industry. However, several other small and medium-
sized players too specialize in specific product lines. In addition, there has been
substantial competition from Chinese equipment‘s manufacturers especially in the high
voltage category. The electrical equipment industry is highly working-capital
Intensive as it takes 4-5 months to recover payments from SEBs, which are their major
clients.
Electric fans
Electric fans are broadly categorized as general purpose fans and industrial fans.
While the latter are used in factories for driving out hot or polluted air, the former
includes ceiling fans, table fans, railway fans and pedestal fans etc. that are meant to
provide human comfort.
An introduction to Indian Fan Industry
Though the first electric fan was manufactured in India in 1921, the industry was
dominated by imports until the late forties. Import of fans was banned after
independence. With this ban, the domestic manufacturing was started in the medium
scale sector in 1947 around Kolkata with a unit called Jay Engineering Works. This was
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followed by orient in early fifties again in Kolkata. With the closure of the JE plant in
Kolkata because of labor problems, JE‘s Hyderabad unit became the main manufacturing
center for the company. Initially, all the components were manufactured in-house by JE.
Over time, In order to reduce costs, JE started outsourcing components until only the
assemblywas being done in-house. Finally, JE started procuring completed fans
manufactured to theirspecifications and branding them..Starting in the mid-eighties,
other brands emerged and JE‘s production declined resulting in excesscapacity with the
component manufacturers. These component manufacturers scouted around for
newcustomers, and as a result the ceiling fan technology was out in the open in
Hyderabad. Over time, inaddition to the organized component manufacturers, there
emerged a number of units in the unorganized sector each manufacturing one or two
components such as CI castings, aluminum diecastings, blades, stators, rotors etc, or
providing single services such as machining. Several assemblyunits also came up and
assembly work became a cottage industry. In this way a cluster of units
formanufacturing fans developed in Hyderabad. In a similar way, clusters came up
around Delhi, Kolkata,
Bangalore, Pune, Varanasi, and in parts of Punjab and Haryana.
Crompton‘s unit came up in late fifties at Mumbai with a British collaboration.
Other organized sector manufacturers also emerged like Khaitan and Rallies (in sixties),
Polar (in seventies) etc. With the development of skills and migration of labor, the
industry developed around metropolitan cities like Delhi, Mumbai and Chennai and then
expanded in the small scale sector of Punjab, Haryana and around cities like Bangalore,
Pune, Hyderabad, Varanasi etc.
The fan industry has grown tremendously in the post-independence period. The
industry has grown nearly ten times between 1950 and 1970. The production from the
organized sector had a five-fold growth from 15.5 lakhs in 1970-71 to 81.4 lakhs in
1998-99. The production from the unorganized sector for the period has grown from 4.5
lakhs to 24.1 lakhs. Thus, the total production has increased from around 20 lakhs in
1970-71 to around 108.5 lakhs in 1998-99. The annual compounded growth comes to
about 5.9% for both the organized and the small-scale sector, the relative share being
fairly stable over the period.
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According to Usha International Limited, the marketing arm of the leading fan
manufacturer, Jay Engineering Works, a total market size of Rs.1500 crores is being
shared by the organized and the unorganized sectors. On this basis, the total production
comes to 262.5 lakh pieces, with the organized sector accounting for 75 lakhs (at a
market price of Rs.1000 per fan) and the unorganized sector accounting for 187.5lakhs
(at a market price of Rs.400 per fan). According to their industry sources, the current
production is of the order of 200 lakhs, with the share of unorganized sector rising to
60%. On this basis, the production comes to 80 lakh fans from the organized sector and
to 120 lakh fans from the unorganized sector.
Sector wise fan production
India is a tropical country and thus fans are necessary. Therefore the Fan industry
in India is well-established and has grown significantly over the years.The fan market in
India consists of ceiling fans (which have dominant share), table fans, pedestal fans, wall
fans and exhaust fans and manufacture special purpose fans for industrial applications.
The Indian market is estimated at 2.5 million fans per month and it is growing at
about10% per annum. India has large number of manufacturing plants located across the
country and producing world class fans.Infact the export of fans from India has doubled
in the last few years and are a testimony to the quality and development of the Indian fan
Industry. The distribution of fans in India is also well developed with over 1,00,000
selling pointsfor fans, across the country.
The fan industry has taken significant steps to ensure consumer satisfaction and
leading brands not only provide good quality but also back this up with good after sales
28
service.The organized market is dominated by players like Usha, Crompton, Orient and
Khaitan.These players are facing stiff competition from the local players who compete on
the basis of price. The organized players try to defend their position banking on their
brandequity.Although the fan industry size is huge, the industry players are facing issues
of competition from unorganized sector. Unorganized sector holds around half of the
totalmarket.It has to be noted that in the early 1990s the market was in the hand of four of
five players like Usha, Polar, Khaitanetc . But later regional players hit the market with
low priced fans which eroded the market share of these major players.
Rural sector offers huge scope for consumer durables industry, as it accounts for
70% of the Indian population. Rural areas have the penetration level of only 2% and 0.5%
for refrigerators and washingmachines respectively. The urban market and the rural
market are growing at the annual rates of 7%-10%and 25% respectively. The rural market
is growing faster than the urban market. The urban markethas now largely become a
product replacement market. The bottom line is that Indian market ischanging rapidly and
is showing unprecedented business opportunity.
More recently, competition in the fan industry has increased, forcing
manufacturers to look foradditional ways to cut costs. Himachal Pradesh (HP) and
Uttarakhand have offered tax holidays toattract industries to set up manufacturing units in
these two states. Some of the entrepreneurs fromthe old clusters shifted their bases to
these two states and some new entrepreneurs joined in. As aresult, now there are a few
hundred manufacturers in these two states who supply fans to all leadingbrands according
to their designs and desired level of quality.
STRUCTURE OF THE INDIAN FAN INDUSTRY
Today the market is divided into three segments:
(1) Eight leading brands - Bajaj; Crompton-Greaves;Havells; Khaitan; Orient; Ortem;
Polar; and Usha - together have a market share of about 60%.
(2) About a hundred lesser known brands in the organized sector have a market share
of about 25%; and
(3) A large number of very small manufacturers have the remaining market share of
about 15%.
29
A largefraction of the demand for fans for the organized sector is met by the clusters in
HP and Uttarakhand.
INTERNATIONAL MARKET
Besides meeting the domestic requirements, electric fans are also bring exported
from India (table – 1.2). It can be seen that with an export of nearly 6.5 lakh ceiling fans
in 1999-2000, the export earning was of the order of Rs.41.6 crores (or an average
realization of Rs.640 per fan). The major destinations for Indian ceiling fans are the
Middle East (Bahrain i.e. Kuwait, Oman, Saudi Arabia, Yemen, United Arab Emirates
etc.), African countries (Ghana, Egypt, Nigeria etc.), South and South East Asian
countries (Sri Lanka, Bangladesh, Singapore etc.), and Italy, United Kingdom and
United States of America. Tables 1.3 & 1.4 provide data on imports of table and ceiling
fans into India in recent years. Given the tropical conditions of India, the growing
population and the reducing cost of fans (particularly those from the unorganized sector),
the demand is expected to grow with a major part of the growth coming from the
household sector. The sources of new demand would be household sector, office sector,
new buildings and replacement requirements of old fans. The estimated demand for
electric fans is shown in table 1.5. With the demand estimated between 11.5 million and
14.9 million over 2001-06, prima facie there appears to be substantial opportunity for
new investments, since the production by the industry was only around 10.8 million in
1998-99, with the contribution of organized industry at 8.1 million.
With easy availability of finance, emergence of double-income families, fall in prices
due to increased competition, government support, growth of media, availability of
disposable incomes, improvements in technology, reduction in customs duty, rise in
temperatures, growth in consumer base of ruralsector, the consumer durables industry is
growing at a fast pace. Given these factors, a good growth is projected in the future, too.
30
3.2COMPANY PROFILE
Crompton Greaves Ltd is one of the world's leading engineering corporations. The
company provides end-to-end solutions, helping its customers use electrical power
effectively and increase industrial productivity with sustainability. Their unique and
diverse portfolio ranges from transformers, switchgear, circuit breakers, network
protection & control gear, project engineering, HT and LT motors, drives, lighting, fans,
pumps and consumer appliances and turnkey solutions in all these areas; thus enhancing
the many aspects of industrial and personal life. The company operates in four segments:
Power Systems, Consumer Products, Industrial Systems and Others. The Power Systems
include transformer, switchgear, turnkey projects and power Supervisory control and data
acquisition systems (SCADA). The Consumer Products business supplies fans, lighting
equipment (light sources and luminaires), pumps, and range of electrical household
appliances and provides solutions for integrated security systems, home automation and
street lighting. The Industrial Systems include electric motors, alternators, drives, traction
electronics and SCADA
Since 2005, CG has embarked upon an ambitious globalization strategy, growing
both organically and inorganically, drawing into its fold leading international companies
such as Pauwels, Ganz, Micro sol, Sonomatra, MSE and PTS. Consequent to this
globalization, CG now enjoys manufacturing bases in Belgium, Canada, Hungary,
Indonesia, Ireland, France, UK and US, in addition to more than twenty manufacturing
locations in India, employing more than 8000 employees worldwide with diverse
nationalities and cultures. A worldwide marketing network of more than 150
representatives spans the globe, offering the entire range of CG‘s products, solutions and
services.
CG has been aggressively investing in R&D, product certifications, product quality,
productivity enhancement and operational excellence. CG`s Global R&D center, located
in India, has been recognized for its innovation and received the prestigious "National
Award for the Best R&D Efforts" for its outstanding achievements in the Electrical
Engineering Sector in 2008. CG`s R&D strategy aligns with the Company`s Global
Vision, and focuses on creating platform technologies, shrinking product development
cycle time and enhancing CG‘s Intellectual Property capital.
31
To unify global focus, all CG facilities across the world have taken actions to ensure
that customers receive consistent "One World Quality", for all CG products and solutions
in all parts of the world.
Thanks to its well structured and validated business model, CG is well positioned to
provide its customers with technology-driven, value-added solutions, leveraging a broad
product portfolio on the one hand, and enhancing the entire value-chain quality, delivery,
and services on the other hand.
Company History
The origins of CG can be traced back to the pioneering work of Colonel REB
Crompton, who, in 1878 founded a business at Chelmsford, Essex, England under the
name of REB Crompton & Co., to engage in the manufacture and contracting of electrical
equipment.
REB Crompton & Co. merged with F&A Parkinson Limited, thereby establishing
Crompton Parkinson Limited (CPL) in England. In 1937, CPL established its wholly
owned Indian subsidiary 'Crompton Parkinson Works Ltd.', in Mumbai, along with a sales
organization, 'Greaves Cotton & Crompton Parkinson Ltd.'
In the year 1947, with the dawn of the independence of India, the Company was
taken over by LalaKaramchandThapar, an eminent Indian industrialist who formed the
Thapar Group. In 1966, Crompton Parkinson Works Ltd and Greaves Cotton & Crompton
Parkinson Ltd. merged to create Crompton Greaves Limited (CG) in its present form.
In the 1960s CG took its initial steps to revolutionize its portfolio, which till then
comprised only motors and consumer products. It took a major leap in the electrical
engineering segment, through the acquisition of transformer technology from
Westinghouse Electric Corporation of USA, for manufacture of 400 kV transformers and
aluminum wound transformers. This was followed by further expansion in the switchgear,
vacuum interrupter and allied businesses. By 2005, the Company had emerged as one of
the leading companies in the electrical engineering domain of India, in its three business
areas of Power Systems, Industrial Systems and Consumer Products; and a serious
contender in the global arena.
32
CG established its international manufacturing footprint in the year 2005 by
acquisition of the Belgium based Pauwels Group, which gave CG additional
manufacturing facilities for Power and Distribution transformers at Belgium, Ireland,
USA, Canada and Indonesia. This was followed with a series of successful acquisitions -
Ganz, Hungary in 2006; Microsol, Ireland in 2007; Sonomatra, France; MSE, USA in
2008 and PTS, UK in 2010 in its quest to establish a technology edge, increase its global
market reach and enhance the product portfolio. The business domains of the new
companies that joined the CG family, has charted the way for CG becoming a "full
solutions provider" which has carved out for CG a position as a serious international
player and a recognized transnational corporation.
Initially, CG`s foreign acquisitions operated their respective businesses under their
individual Brand names. To integrate these new entrants into the CG family, the first step
was integration of processes, systems and technologies across all the acquired companies
worldwide. The next step was to articulate the one single idea that provided a common
thread through all the CG Group companies. We discovered our shared philosophy as
"our core strength is the value we place on relationships, and the ability to provide
solutions, which, in turn, strengthen these relationships". This realisation and initiative
gave birth to CG`s new Brand Identity which was launched on 15th October, 2009,
succinctly conveying this shared philosophy.
In May 2011, the company was awarded a contract for acting as the distribution
franchisee of Maharashtra State Electricity Distribution Company Ltd (MSEDCL) for
power distribution in the Jalgaon Circle (Maharashtra) for a period of ten years. In May
19, 2011, the company acquired Emotron of Sweden for an enterprise value of Rs 57.8
million there after they acquired QEI Inc of USA, a provider of automation systems and
products for power transmission and distribution, for an enterprise value of USD 30
million. In 2012 Crompton Greaves Acquired leader in smart Grid Automation : ZIV
Group, then again Crompton Greaves establishes new JIT manufacturing facility in
Goa.AfterwardsGreaves crossed the three million mark in light diesel engines.
Whilst the Company`s name in India will continue to be Crompton Greaves, the
names of all the foreign companies in the CG family start with "CG", thus establishing
their lineage and uniting every company in the CG family with a common face to the
internal as well as the external world, globally.
33
Today, CG is a public listed company, amongst the "A" (premier) category of
listings on the Bombay and National Stock Exchanges of India and its GDRs are listed on
the London Stock Exchange, with over 140,000 shareholders.
Values
The ideology for CG`s businesses emanates from its 5 Values of Performance
Excellence; Leading Edge Knowledge; Nurturance; Customer Orientation and Intellectual
Honesty. These Values articulate the basic behaviors that every employee is expected to
display in business situations and these form the core principles for all actions.
CG thrusts upon each employee to be aware of and practice the CG Values, and behave in
accordance with the letter as well as the spirit of CG Values.
Brand Values
When a customer thinks of a fan the chances are that the name most top of mind is
Crompton. This is the real power of this fine brand, recognized and validated, time and
again, by Indian consumer studies. Over the years, the powerful brand recall – the identity
of fans with Crompton – has impacted not only dealers but also consumers. Crompton
fans signify and embody trust, unimpeachable quality, reliability and a sense of
belonging. The brand has been generational in character, like a family that has grown up
with, inspiring and been inspired by its customers. The brand has never fallen behind
trends; it has led them. The legacy of the fan that keeps working from year to year is the
special bonding it has forged with its customers – a tie that has only grown stronger with
time.
Promotion
It is believed in the advertising world that ultimately a product will sell on its own
merit –thus underlining the significant role of word-of-mouth. This adage is best
illustrated in thepositive feedback Crompton fans generate from satisfied customers. In
many pockets of the country, the brand has almost become generic to fans. To ensure that
the customer is effectively updated on new product developments, the company has
identified the sales counter as its first point of contact. Crompton provides product
34
information leaflets and catalogues at all these locations, besides also dynamically
displaying its range banners.
Channel partners are trained and armed to handle every conceivable query on
models,performance, maintenance, utility and value-for-price considerations. Sales
promotiondrives at the regional level ensure that Crompton fans can be seen on high-
visibilitylocations such as front-lit hoardings, gantries, bus and metro panels, road shows
andmobile vans. The brand advertises regularly in the print and electronic media at the
national as well as regional levels. It actively seeks to be seen in places of mass interest.
Thus, the sports section of national dailies carried sustained advertising for Crompton
fans during the first round of the IPL cricket series. Crompton Greaves is notably present
at most national exhibitions for electrical goods. Prominent amongst these are Elecrama
and Gridtech which provide the company highvisibility platforms to promote its wares on
a large scale. In the Hannover and the Dubai Electricity Fairs, Crompton Greaves stalls
with banners, display logos, glossy handbooks are must-visit destinations. At these fairs
the company sends out a powerful message: it can compete with any world-class
company and benchmark its products and technologies with the best in the business.
Code of Business Practices
The CG Code of Business Practices has been conceptualized considering CG`s
multi segment and transnational culture, as well as the need to respect the cultures of all
companies in the CG fold. The Code strives to provide guiding principles in various
business situations and is the lighthouse for decision making and actions, with integrity
and discipline. This Code also aims to minimize adverse consequences due to ambiguity,
for CG and every employee.
CORPORATE GOVERNANCE
CG believes that its Management is accountable to its shareholders, for creating,
protecting and enhancing their shareholder value, and reporting to them on the Company's
performance and developments on the performance in a timely and transparent manner.
All our systems institutionalize our belief that Corporate Governance protects the interest
35
of all stakeholders by inculcating in all our operations and processes, the principles of
transparency, integrity, professionalism and accountability.
It starts at the top with the Board of Directors comprising eminent professionals, as
Independent Directors, who provide high quality, impartial advice to the Chairman,
Managing Director and the various Committees of the Board. The Chairman of the Board
is a non-Executive Director providing the necessary independence to the management to
chart its growth strategy and promote operational excellence. Espousing the philosophy of
going beyond Regulatory requirements, the number of Independent Directors on the
Board far exceeds the proportion required between Independent and Non-Independent
directors, prescribed by the Listing Agreement with the Stock Exchanges.
The above ideology is also well reflected through best-in-class business practices
and adoption of high level ethical standards in all its business dealings. CG encourages
Management independence and provides individual flexibility within an established
framework of policies, standards and processes, which for clarity, are amplified in its
"Rules of Procedure for Management" through which decision-making levels, with
respect to the areas of importance in CG`s day-to-day operations within India, are
documented.
As CG`s foreign locations progressively get integrated with CG India, the best
practices of governance get progressively extended to these locations as well. To better
achieve its high Governance standards at its foreign locations as well, CG has articulated
"Transnational Governance Guidelines", with a view to creating a common platform for
Board practices across the Company`s subsidiaries and joint ventures, and introduce an
effective governance framework. These Guidelines outline comprehensive integrated
approach towards Governance, which includes creation of an Authority-Responsibility
Matrix for Management; Compliance Certifications; Board Compositions, Procedures,
Information Flow, and Reporting Formats for Board Reviews, across the Group.
36
Business Review Process
CG has a robust business review framework, to monitor the ultimate direction and
implementation of the Company`s business strategies and plans. Periodically, each
business presents its strategic road map at specially constituted Board meetings.
Approved initiatives form a part of the growth and business strategy of the Divisions. The
performance of the businesses is reviewed at monthly meetings, through a monthly
review by the Managing Director with the Management team. Operational Issues and
budgets are extensively monitored through an elaborate Management Information
System, with adequate focus on non-financial business enablers including process
improvements and customer service
CG Global R&D Centre
CG Global R&D Centre is a state-of-the-art facility which caters to the New
Product Development & technology needs for its Strategic Business Units spread across
the world.
The Global R&D Centre is certified with ISO 9001:2008, ISO 27001:2005 and its
laboratories are NABL accredited for testing & calibration as per ISO/ IEC 17025:2005.
It has also bagged the Golden Peacock Award. At the center of the activities are the 12
expert centers with highly qualified manpower and a robust infrastructure driven by a
strong technology process. The R&D Centre manages CG`s innovation wealth through its
state of the art IPR (Intellectual Property Rights) cell. Through its research contributions,
it has earned itself much recognition such as DSIR recognized R&D Centre.
Recent Developments
Over the decades, Crompton fans have been synonymous with eminence and
dependability. To maintain this distinction Crompton Greaves strives to produce better
fans every day. Its most recent high-profile initiative is the conscientious design and
implementation of a Six Sigma initiative. Six Sigma is a practice designed to
improvemanufacturing processes and reduce production defects leading to a measurable
improvement in customer satisfaction. The company is working towards achieving the
sixth level which entails bringing defects down to 3.4 parts per million opportunities.
37
3.3PRODUCT PROFILE
As one of the world`s leading engineering corporations, Crompton Greaves
provides end-to-end solutions, helping its customers use electrical power effectively and
increase industrial productivity with sustainability. CG was established in 1937 in India;
and, since then the Company has been a pioneer and has retained its leadership position in
the management and application of electrical energy.
PRODUCTS MANUFACTURED
Crompton greaves unique and diverse portfolio ranges from transformers,
switchgear, circuit breakers, network protection & control gear, project engineering, HT
and LT motors, drives, lighting, fans, pumps and consumer appliances and turnkey
solutions in all these areas; thus enhancing the many aspects of industrial and personal
life. This portfolio has been structured into 3 SBUs –
Power Systems
Industrial Systems
Consumer Products.
Power Systems
Power Systems, includes the business area related to transformers, switchgear,
circuit breakers, vacuum interrupters, network protection & control gear, as well as
design, execution and servicing of turnkey T&D as well as sub-station projects and
solutions including complete end to end Renewable projects. This is the largest business
of CG which is now well entrenched throughout the world. It is a high value, high
turnover business with a strong global footprint, contributing to approx. 70 per cent of
CG‟s consolidated revenue. Its facilities are located in Belgium, Canada, Hungary, India,
Indonesia, Ireland, France, UK and USA.
38
Fig,3.1.Transformers& Reactors
Fig 3.2.Switchgear Products
It includes :
Transformers & Reactors
Switchgear Products
Instrument Transformers
Power Quality Solutions
T&D Systems / Engineering Solutions
Protection, Control & Automation
39
Services for Power Systems
Transformer & Switchgear Components
LV Switches & Panel Products
Industrial Systems
Industrial Systems is engaged in the business of providing solutions through the
supply of power conversion equipment‘s of a wide spectrum of High and Low Tension
rotating machines (motors and alternators), inverters & converters, stampings, as well as
railway transportation and signaling equipment‘s. Industrial Systems has a very strong
market presence and market leadership position in most segments in India. It also caters
to overseas markets through its facilities in Hungary and through exports from India. Its
product portfolio includes motors ranging from 20W to 25MW and generators ranging
from 1kW to 70MW; and CG is the largest manufacturer of Low Tension motors in India
offering a range of 0.18kW to 4MW in various standard and customized configurations to
respond to the exacting demands of the industry.
Fig 3.3. Industrial Systems
40
Fig. 3.4. Rail Control & Coach Products
It includes :
Motors: High / Low Voltage AC & DC
Generators / Alternators AC & DC
Traction Motors / Alternators / Control Electrics
FHP / Commercial Motors
Railway Signalling& Coach Appliations
Drives & Automation
Stampings & Laminations
Services for Industrial Systems
Products & Solutions by End Use
Consumer Products
Consumer Products, one of CG's fastest growing businesses, manufactures and
markets a wide spectrum of products ranging from fans, light sources and luminaires,
pumps and household appliances such as geysers, mixer grinders, toasters, irons and
41
electric lanterns. This business is the second largest SBU of CG. It also enjoys a
substantial brand presence and goodwill in India.
CG's Fans and Lighting Brands have been accredited with the 'Superbrand' status.
CG has the largest number of 5-Star energy efficient rated products in this segment in
India, certified by Bureau of Energy Efficiency, a Government of India agency. CG is the
largest manufacturer of fans in India, with offerings for all sections of the market and
various applications - domestic or industrial . Although predominantly India centric, CG
is a leading fan exporter to countries like USA, Italy, South Africa, Ghana, Fiji,
Singapore, Bahrain, UAE, Sri Lanka, UK, France, Oman, Sudan, etc.
Fig. 3.5.Celling Fans
42
Fig. 3.6.Industrial Fans
It includes :
Fans
Appliances
Lighting
Pumps
Home Automation
Integrated SecuritySystems
Wiring Accessories
The Fans Division of Crompton Greaves is the market leader in India and has
been so for over a decade. It‘s dominance of the market is comprehensive and it
manufacturers fans for all sections of the market and for all applications of air delivery –
be it domestic or industrial. In the international market, the company is one of the leading
exporters to countries like USA, Italy, S.Africa, Ghana, Fiji, Singapore, Bahrain, UAE,
Sri Lanka, UK, France, Oman, Sudan, etc.
Its products are known for consistent quality, low current consumption and high volume
air delivery. Crompton Greaves Fans are the preferred supplier for two important Govt.
43
of India departments – Defense and Directorate General of Supplies and Disposal
(DGSD).
The Indian Standards Institute (ISI) has certified the quality of the range of
Crompton Greaves fans and the brand has been awarded the ISI mark. The range is also
certified by a variety of International Quality Certification boards.
Fan range includes:
Luxury Under light Fans
Premium Decorative fans
Star Rated Fans
Standard Fans
Table Fans
Pedestal Fans
Remote Fans
Wall Mounting Fans
Battery Operated Fans
Domestic Exhaust Fans
Speciality Fans
Industrial Fans
CG`s ceiling fans incorporate power and performance, safety and durability,
comfort and style and offer both decorative and economy models to suit individual needs
Crompton Greaves range of ceiling fans is the largest in India and encompasses
everything from under-light and decorative fans to standard models in different colours
and blade shapes. In addition, its table, pedestal and wallmounted fans are available in
both metal and plastic and form an enviable addition to the brands' product portfolio. For
the industrial segment Crompton Greaves has a range of industrial heavy duty exhaust
fans, air circulators and air curtains.
44
CHAPTER 4
REVIEW OF LITERATURE
45
4. REVIEW OFLITERATURE
Indian Consumer Durable sector has been witnessing significant growth in recent
years, helped by several drivers such as retail boom, real estate, and housing demand,
greater disposable income and an overall increase in the level of affluence of a
significant section of population. Apart from steady income gains, consumer
financing and hire purchase schemes have become a major driver in the consumer
durable industry. Indian consumer durable industry can be broadly segmented into
three key groups:- 1) White Goods: Washing Machines, Air conditioners, Speakers
and Audio equipment, etc. 2) Kitchen Appliances or Brown Goods: Mixers, Grinders,
Microwave ovens, Fans etc. 3) Consumer Electronics: Mobile Phones, Televisions,
DVD players, VCD players etc (1. Sontaki, S. N. (1999))
Anyone who has a continuing relationship with a supplier in buying and selling
goods is considered a dealer. More specifically, dealers are middlemen selling
industrial goods or durable consumer goods direct to customers; they are the last step
in the channel of distribution. Dealers have continuing, close working relationships
with their suppliers and exclusive selling rights for their producer‘s products within a
given geographic area. They drive a large portion of their sales volume from the
products of a single supplier firm (2. Cateora, PR& Graham (2004)).
In marketing channel relationship, researchers have revealed that a channel
member‟s satisfaction increases long-term orientation and continuity .In such cases,
channel members like retailers and dealers must develop good working relationships
with their suppliers in order to provide merchandise efficiently and effectively to the
consumers. This is because the retailers and their suppliers are interdependent on one
another and this relationship is a key to a successful channel distribution. In addition,
building strong relationships between manufacturers, suppliers, distributors, retailers,
and customers has become an important channel strategy in both industrial and
consumer markets. Through the utilization of relationship element like relationship
satisfaction, buyers and suppliers could integrate various functions spread over
different areas within them which could lead to greater levels of channel trust and
commitment. This effort could enhance their capability to cope with today‟s
worldwide trend towards building closer and more integrated relationships between
46
channel intermediaries and suppliers (3.Corsten, D. & Kumar, N. (2005) & 4.
Leonidou, L. C., Palihawadana, D., &Theodosiou, M. (2006)). Studies found that
higher levels of supports are associated with higher levels of satisfaction in channel
relationships .A study in channel relations by Gassenheimer and Ramsey (1994)
found that dealers‟ reliance on their primary supplier for quality of service support,
not only contributes to the dependence imbalance, but also to their satisfaction with
the relationship. In other words, dealers who receive better service support from their
primary supplier consider the relationship as more satisfying. (5. Gassenheimer, J. B.,
& Ramsey, R. (1994)).
Relationship has become an inevitable feature in today‟s business environment.
Businesses are increasingly emphasizing on the relationships they have with their
suppliers and are demanding that they adhere to high standards. The pressure to
compete also makes it necessary of the development and maintenance of relationships
between buyers and suppliers. In relation to that, small and large companies nowadays
are fostering partnerships with suppliers as a foundation of their supply strategies (6.
Theng-Lau, G., &Goh, M. (2005). A study by Abdul-Muhmin (2005) among Saudi
Arabia manufacturing firms discovered that relationship satisfaction is positively
related to satisfaction with product performance of the supplier‟ marketing
programme. However, there is no relationship found between pricing, delivery
support and marketing communication performance on relationship satisfaction.
(7Adul-Muhmin, A. G. (2002)). In a study done by Nor Azila, M.N*, Selvan, P.a and
Zolkafli, H.b on globalization in the automobile industry: how supplier-dealer
relationship could be effectively managed it was revealed that the dealers‟
relationship satisfaction is contributed by supports that they get form the suppliers.
Specifically, sales support from the supplier appear to develop the amount of
satisfaction that the dealers perceive to obtain from having relationship with the
suppliers.Perceptions of a dealer‟ relationship satisfaction is important to suppliers for
three reasons. First, suppliers who are partnering with highly customer-oriented
dealers, may be able to create greater value for end customers and thereby gain a
competitive advantage by maintaining satisfied relationship with the existing dealers.
Second, suppliers may be able to improve their own levels of performance through
trickle-up effect, which means that when dealers‟ satisfaction improves, by virtue of
the dependent dealer-supplier relationship, it will lead to suppliers‟ sales
improvement. Finally, relationship satisfaction becomes relevant because of the
47
concern given to the importance of relational market base which appears to be
vigorous for current business competencies, especially in the area of managing
relationship between organizations. (8.Nor Azila, M.N., Selvan, P.a, Zolkafli, H.b
(2011))
A study done by Norris Bruce, Preyas Desai & Richard Staelin on Trade
Promotions of Consumer Durables revealed inter-temporal effects of trade promotions
as well as the effect of product durability on the promotion strategies of
manufacturers. For example, manufacturers of more durable products benefit more
from running trade promotions and give deeper discounts.most trade promotion
models assume a) the retailers can forward buy, b) the manufacturers are not able to
easily monitor the retailer‘s sales and c) the product being sold is a non durable and
thus there is no secondary market for the used product. In addition, most trade
promotion models are aimed at situations where the retailer is able to carry multiple
products produced by competing manufacturers. In contrast, automobiles (and many
other durables) are sold through franchise dealers who can carry and display only one
manufacturer‘s line. (9.Norris Bruce, Preyas Desai, Richard Staelin, (January, 2004))
In the study of 2012 India Dealer Satisfaction with Automotive Manufacturers
Index Study, MohitArora mentioned that overall dealer satisfaction is determined by
examining nine factors: marketing and sales activities; product; vehicle ordering and
delivery; sales team; parts; warranty claims; after-sales team; training; and support
from the manufacturer‖J.D. (10.Power Asia Pacific 2012). In a study Md.
AslamUddin studies the dealers‘ satisfaction of Partex Furniture Industry Limited
(PFIL) in Bangladesh. The study was designed to provide manufacturers with insights
about dealer opinions and attitudes to help them improve dealer relations. In order to
ensure the fulfillment of the concept ‗place‘ in marketing mix and to survive in the
competitive environment, organizations need to satisfy its‘ dealers by providing
greater benefits from all the aspects.The total number of dealer and agent outlets of
this organization is about 80. Among them, 20 outlets have been selected as sample.
The findings of this research showed that most of the dealers are satisfied with their
principal in respect of availability of products, timeliness of product deliveries,
quality, price, credit sales, allowances, and brand name. (11.Md. AslamUddin
(August 2012))
48
CHAPTER 5
THEORETICAL FRAMEWORK
49
5. THEORETICAL FRAMEWORK
Market
The market consists of all the potential customers, dealers and producers sharing a
particular need or want who might be willing and able to engage in exchange to satisfy
that need or want. But the growth in the size of the companies and markets has removed
many marketing managers from direct contact to the customers. The role of dealers in
developing the marketing activity cannot be ignored. Several instructions are involved in
discharging marketing functions. There may be either small machinery or big, good or
bad, but they are on their toes to satisfy human wants.
Marketing
Marketing is essentially about marshaling the resources of an organization so that
they meet the changing needs of customers on whom the organization depends. As a verb,
marketing is all about how an organization addresses its markets. Marketing is ―The
management process which identifies anticipates and supplies customer requirements
efficiently and profitably‖. Marketing is a total system of interesting business activities
defined to Plan, piece, promote and distribution want satisfying products & services to
present and potential consumers‖- William. J. Stantion
Marketing is the performance of business activities that direct the follow of goods
and services from the producer to the consumer or user - American Marketing
Association A social and managerial process, by which individuals and groups obtain
what they need and want, through creating and exchanging product and value with others.
Dealer
Dealer is a person or firm engaged in commercial purchase and sale. Dealer may
signify firms that buy or resell products at retail or wholesale basis. A producer cannot
sell all his products directly to consumer, he has to depend upon intermediaries to push,
off, his products. A dealer is an intermediary who helps to market a product. A dealer is
one who purchase and sells products. A dealer may be a wholesaler or a retailer or a
distributor or any agents. The volume of sales depends on the efficiency of a dealer who
assesses the psychology of consumers and takes appropriate steps to sell a product. It is
the dealer who suggests to the manufacturers the suitable media of advertisement and
other promotional tools. Dealers include all activities involved in selling goods and
50
services to those buying for resale or business use. Dealers buy mostly producers and sell
mostly to retailers or industrial consumers
Dealer Satisfaction begins with the following specific assumptions about
company‘s relationship with the customers.
• The dealer service activities focus mainly on existing dealers.
• Some dealers are more important than others
• They are the assets
• The dealer is always specific.
The dealer needs and value should influence every aspect of the organization
strategy, employee safety and performance, product and organization strategy, employee
safety and performance, product and service development, sales and marketing programs,
operational procedures and information and measurement system. Understanding the
dealer is critical to the success of any customer focus initiative, the first step in
understanding the dealers is to listen to them. A company needs to hear what its dealers
are saying about its people, product, service and vision. Their information helps to
develop meaningful product and service. Organizations need to listen to their dealer
satisfied, dissatisfied, neutral and prospective. In the past, dealer satisfaction and service
was the responsibility of a separate organization that supported the dealer primarily after
the sale. Today, service is also likely to be interested with the every product a company
offers. High dealer satisfaction comes from providing effective services. But giving that
service is a continuous activity. It means being efficient, reliable, courteous, curing and
professional every time.
Dealer wants high marginal gain from manufacturers. The main objective of
dealership isearning profits. Dealership business is different from other business. The
peculiar feature of a dealer is dealing with one or more similar products. Dealers earn
commission for goods sold from the manufacturers. The commission depends upon the
value of sales both cash and credit. Dealer excepts income from business because there is
some guarantee of getting more commission from this business. Dealers demand more
commission from the manufactures; they cover the entire market within their locality.
51
Channel Marketing
Channel marketing is the means by which manufacturers work with different
distribution channel members to reach consumers with their products. In addition to
helping manufacturers serve customers, channels allow manufacturers to transfer a
portion of their marketing costs to channel partners. Selecting appropriate channel
members and marketing activities involves choosing ones that meet the manufacturer's
needs and effectively serve consumers while generating profitable sales for all channel
members. Much of the power in the channels of distribution has shifted to the retailer as
competition for limited amounts of shelf space has intensified. Therefore, marketers must
focus their attention and effort on "pushing" their products through the channels of
distribution. Trade sales promotions are an important part of this strategy.
Advertising
The term advertising includes any paid form of non-personal communications
through the media about a product, that has an identified sponsor. The use of payment
differentiates advertising from public relations for which no payment is made for the time
or space to convey a message. The media may include telephone directories, guides,
newspapers, magazines, radio, television, direct mail, Web pages and billboards. It is
normally associated with mass communication, where a broad target market is to be
contacted.
Types Of Advertising:
Product advertising:
Product advertising is aimed at enriching people to the store in order to consider
specific merchandise. Product advertising will feature the promotion of merchandise that
is new, exclusive, and superior in aspects of quality and design as well as creating
awareness of complete assortments or special merchandise events.
Markdown event advertising:
This is used to create some excitement about a special period of lower cost offers
for products. It is likely to be more successful if the reduction is believed to be part of a
genuine sale of products which in the past had been fairly faced.
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Institutional advertising:
This type of advertising is used to sell the store or shopping mall as a pleasing
place to shop. With the use of institutional advertising, the store attempts to reinforce the
image of one or more of the following: a leader in fashion, fair prices, wide merchandise
selection, superior service or quality, a leisure experience or somewhere to enjoy visiting.
Co-operative advertising:
This is used where manufacturers fund part of a promotion by supplying leaflets
or advertising material for use by the store. The store can add its own address to ready
prepared printed material and carry out mail drops or other methods of distribution.
Alternatively a manufacturer may agree to share equally the costs of an advertising
campaign.
Credit facilities:
Business is based on bonafide good faith, confident and mutual trust. Long ago
businesswas based on cash basis. But now business is based on mercantile basis (Credit
basis).More over cash basis of business in also not possible for every business because of
want of funds. Mercantile basis of business is globally accepted and very easier for the
business people.Credit facilities to regular customer and genuine consumers will enhance
the business.There some consumers who buy mostly in credit and make their payment at
regular intervals. There is some agreement between the buyer and seller for a credit
purchase.This agreement also covers terms of payment trade discount, cash discount etc.,
for thesmooth ant regular payment of cash. Credit facility system is beneficial to both the
buyersand sellers. There will be tremendous improvement on both the sides. Allowing
credit toconsumers is also useful for growth and expansion.
Trade Sales Promotions
Trade sales promotions are designed to encourage channel members to stock,
display, and promote the marketer's brand. They are part of a promotional "push"
strategy. Their role is to improve trade relations, gain new distributors, and obtain support
for consumer sales promotions.
53
Trade Sales Promotion Tactics (or Tools)
Once the trade objectives and strategies are established, it is important to develop
a tactical plan for the execution of these promotions. There are numerous people and
tasks to be planned within a specific period to ensure that the trade promotion strategies
are executed perfectly.
There are a variety of trade promotion techniques manufacturers can use as incentives (it
leads to price reductions) for sales representatives, wholesalers, distributors and retailers.
Contests and Incentives
Manufacturers use contests and special incentive programs to stimulate greater
selling effort from resellers, management, and/or sales personnel. Special prizes and
contests (especially travel-related contests) are available when sales reach a
predetermined volume (or a stated percentage increase on the previous year's sales). The
sales personnel of the intermediaries are an important target of contests or special
incentives. Contests offering several prizes are much more successful than those offering
only one or two big prizes.
Trade Allowances
The most commonly used trade promotion is some form of trade allowance. This
is a discount or deal offered to the retailer or channel member to encourage them to stock,
promote, and/or display a manufacturer's products. There are several types of trade
allowances, including:
Buying allowances—A deal or discount offered to resellers in the form of a price
reduction on a product ordered during a fixed time period. As an example, a coat
manufacturer may offer a 30% reduction in the cost of a coat if the retailer agrees to order
and pay for the coat in the summer months. This allowance benefits the manufacturer in
that it can keep the factory operating during the summer months, and it benefits the
retailer in that it receives a substantial discount by ordering early.
Promotional allowances—These are discounts provided to retailers for performing certain
promotional or merchandising activities in support of a manufacturer's brand.
Slotting allowances or fee—A one-time fee manufacturers pay retailers to stock a product
and provide a slot or position in their stores. The fee depends upon the product placement
54
on the shelf-shelf space just above eye level costs more than shelf space closer to the
floor-and how many front-facing columns the product will occupy on the shelf.
Displays and Point-of-Purchase (POP) Materials
POP materials are displays designed by the manufacturer and distributed to retailers to
promote a particular brand or line of products. Products often sell better when they are on
display, as they are more likely to be noticed by consumers.
POP displays advertise a product at its point of purchase. They are important promotional
tools as they help a manufacturer obtain more effective in-store merchandising of their
products. The manufacturer employs a price discount called a display allowance to obtain
trade support from retailers for their displays.
Marketers use a variety of POP materials, including on-premise signs, window displays,
display racks, display signs, wall displays, posters, banners, audiovisual materials, and
vending machines. These materials can be as small as a 2? by 3? sign card on a store shelf
or as large and expensive as a major cosmetic manufacturer's counter in a department
store.
Keep in mind, that the lower the level of customer service, the more essential POP
material becomes. These displays are particularly important in self-serve outlets.POP
materials are effective because they provide customers with a reminder just prior to
making their purchase decision and a finishing touch to a well-integrated MC program.
Most importantly, when the creative concept and message of the marketing
communication tools are repeated in an in-store display, sales increase significantly.
Dealer Loaders
These are an incentive or a gift given to a wholesaler or retailer in return for
purchasing a particular quantity of a product during a trade sales promotion. Often the
incentive is a POP display or attached to a POP display—these types of dealer loaders are
permanent displays the store can continue to use after the end of the promotion. The
objective of dealer loaders is to gain the attention of the trade and encourage support of
the trade sales promotion.
55
Gifts
Some reputed companies will provide a number of gifts to its dealers and distributors.
Their gifts are allowed to improved sales in all areas. Dealers will be much motivated
when gifts are offered by manufactures. Gifts are a special kind of incentives, which will
pursue the dealers to increase their sales. The main objectives of offering gifts to dealer
and distributors are to enhance or improve sales to the maximum level. The competition
can be easily managed when gifts are offered to dealer, the number of types of gifts is as
follows.
Value of sales in Rupees.
Value of sales in units
Seasonal gifts.
Gifts to dealers will play a greater role in marketing. This will motivate the full dealers to
do better and this will also encourage better sales.
56
CHAPTER 6
DATA ANALYSIS AND INTERPRETATION
57
6. DATA ANALYSIS AND INTERPRETATION
6.1. EXPERINCE IN SELLING CROMPTON GREAVES PRODUCTS
EXPERIENCE IN SELLIG CROMPTON PRODUCTS
Sl.No. Criteria No. of respondents % of respondents
1 Less than 3 years 13 17.3
2 4 – 7 years 14 18.7
3 8 – 10 years 7 9.3
4 Above 10 years 41 54.7
Total 75 100
Inference:
This table shows the experience of the dealers in dealing the Crompton Greaves
products. 18.7% of the dealers have experience in dealing Crompton products for 4 to 7
years. Experienced dealers are up to 9.3%. 41% of the dealers are having experience
above 10 years and the rest 17.3% have less than 3 years‘ experience with Crompton
products.
Fig. 6.1.EXPERIENCE IN SELLING CROMPTON PRODUCTS
58
6.2. DEALING WITH COMPETITORS
DEALING WITH COMPETITORS
Sl. No. Criteria No. of respondents % of respondents
1 Yes 63 84
2 No 12 16
Total 75 100
Inference:
Most of the dealers deal with the competitors also. This is in order to satisfy their
various customers who have different brand and product preferences. Most of them are
dealing in companies like Havells,Orient, Usha, Bajaj, Khaitan, Polar and many other
local brands. Many of them are dominated by Crompton Greaves.
Fig. 6.2 DEALING WITH COMPETITORS
59
6.3. USE AND PATTERN OF ADVERTISEMENTS
6.3.1 USE OFADVERTISEMENT
USE OFADVERTISEMENT
Sl. No. Criteria No. of respondents % of respondents
1 Yes 16 21.3
2 No 59 78.7
75 100
6.3.2PATTERN OF ADVERTISEMENTS
PATTERN OF ADVERTISEMENTS
Sl. No. Criteria No. of respondents % of respondents
1 Independently by
the shop
8 10.7
2 In collaboration
with the company
8 10.7
3 Solely by the
company
59 78.7
75 100
Inference:
These tablesdisplay the use of advertisements by the dealers of Crompton Greaves
decorative fans and the pattern in which they have used it. It can be seen that majority of
the dealers ie. Almost 78.7% had no advertisements for the decorative fan ranges, these
dealers display a pattern of advertisement which is done solely by the company. 21.3 %
of the dealers mentioned the use of advertisements of which the half of them does their
advertisements independently by the shop and the other half does advertisements in
60
collaboration with the company. The common forms of advertisements seen are Bill
boards, Posters,Catalogues etc.
Fig. 6.3 (a )USE OF ADVERTISEMENT
61
F1g. 6.3 (b)PATTERN OF ADVERTISEMENTS
62
6.4. FACTORS AFFECTING DEALER SATISFACTION.
FACTORS AFFECTING DEALER SATISFACTION.
Sl. No. Criteria No. of respondents % of respondents
1 Promotion Schemes 3 4
2 Company Policy 0 0
3 Margin 8 10.7
4 Brand Name 24 32
5 Availability 5 6.7
6 Timely Delivery 4 5.3
7 Product Quality 23 30.7
8 Price 6 8
9 Credit Period 2 2.7
Total 75 100
Inference:
The table shows the factors affecting dealer satisfaction.Most of the dealers
mentioned Brand name(32%) and Product quality(30.7) as their main reason for
continuing as a Crompton greaves dealer. Those dealers who mentioned margin as a main
factor were 10.7 %. 8 % of the dealers mentioned Price as a major factor. Percentage of
dealers who mentioned availability of the products as a major factor were 6.7 & 5.3 % of
dealers said Timely delivery as their main factor. 4% of dealers mentioned Promotion
schemes as a factor affecting dealer satisfaction and the rest 2.7 % dealers mentioned
Credit period as the major factor for their satisfaction.
63
Fig.6.4 FACTORS AFFECTING DEALER SATISFACTION
64
6.5. OPINION ABOUT THE BRAND CROMPTON GREAVES
OPINION ABOUT THE BRAND CROMPTON GREAVES
Sl. No. Criteria No. of respondents % of respondents
1. Very Good 25 33.3
2 Good 34 45.3
3 Average 16 21.3
4 Poor 0 0
5 Very Poor 0 0
Total 75 100
Inference:
Majority of the dealers had the best remarks for the brand Crompton Greaves 33.3
and 41.3% of the dealers mentioned the brand Crompton as very good and Good
respectively. 21.3 % of the dealers mentioned the brand to be Average. No dealer
mentioned the Brand to be Poor or Very poor.
Fig. 6.5 OPINION ABOUT THE BRAND CROMPTON GREAVES
65
6.6. OPINION ABOUT QUALITY OF CROMPTON GREAVES
DECORATIVE FANS
OPINION ABOUT QUALITY OF CROMPTON GREAVES DECORATIVE FANS
Sl. No. Criteria No. of respondents % of respondents
1. Very good 31 41.3
2 Good 31 41.3
3 Average 13 17.3
4 Poor 0 0
5 Very Poor 0 0
Total 75 100
Inference:
Majority of the dealers said the quality of Crompton Greaves decorative fans is
the best in market today. 41.3 % mentioned it to be very good. 41.3 % of them said its
quality to be good. The rest 13 % of the dealers mentioned the Quality of Crompton
greaves decorative fans to be Average. No dealers mentioned the quality of the fans to be
below average.
66
Fig. 6.6QUALITY OF CROMPTON GREAVES DECORATIVE FANS
67
6.7.OPINION ABOUT MARGIN OF CROMPTON GREAVES
DECORATIVE FANS
OPINION ABOUT MARGIN OF CROMPTON GREAVES DECORATIVE FANS
Sl. No. Criteria No. of respondents % of respondents
1. Very good 4 5.3
2 Good 15 20
3 Average 44 58.7
4 Poor 12 16
5 Very Poor 0 0
Total 75 100
Inference :
Most of dealers mentioned the margin from Crompton Greaves decorative fans to
be having moderate level of margin. 44% of dealers said their margin to be average.4% of
dealers mentioned their margin to be very good and the rest 15% of the dealers said their
margin from Crompton premium decorative fans to be good.
68
Fig. 6.7OPINION ABOUT MARGIN OF CROMPTON GREAVES DECORATIVE
FANS
69
6.8.OPINION ABOUT PROMOTIONAL ACTIVITIES OF
CROMPTON GGREAVES
OPINION ABOUT PROMOTIONAL ACTIVITIES OF CROMPTON GGREAVES
Sl. No. Criteria No. of respondents % of respondents
1. Very good 12 16
2 Good 21 28
3 Average 30 40
4 Poor 12 16
5 Very Poor 0 0
Total 75 100
Inference:
Mostof the dealers were satisfied by the present promotional activities of
Crompton. 40 % of thedealers mentioned it to be average. 28 percent of the dealers
mentioned it to be good, 16 % mentioned it to be very good and 16 % of them rated it as
poor.No dealer said it to be very poor.
70
Fig. 6.8 OPINION ABOUT PROMOTIONAL ACTIVITIES OF CROMPTON
GREAVES
71
6.9. MOST PREFERED TYPE OF PROMOTIONAL ACTIVITY
MOST PREFERED TYPE OF PROMOTIONAL ACTIVITY
Sl. No. Criteria No. of respondents % of respondents
1. Discount 41 54.7
2 Gift/Prize 10 13.3
3 Offers 22 29.3
4 Others 2 2.7
Total 75 100
Inference :
54.% of the dealers said Discount as their most preferred type of promotion. 29.3
% of the dealers said offers were their most preferred type of promotion and 13.3 %
dealers selected Gifts or Prizes as their preferred type of promotion.2.7 % of the dealers
suggested some other methods of promotion such as dealer meets, bonuses, surprise
schemes etc.
72
Fig.6.9. MOST PREFERED TYPE OF PROMOTIONAL ACTIVITY
73
6..10. OPINION ABOUT TIMELY DELIVERY OF CROMPTON
DECORATIVE FANS
OPINION ABOUT TIMELY DELIVERY OF CROMPTON GREAVES
DECORATIVE FANS
Sl. No. Criteria No. of respondents % of respondents
1. Highly Satisfied 36 48
2 Satisfied 29 38.7
3 Average 4 5.3
4 Dissatisfied 6 8
5 Highly Dissatisfied 0 0
Total 75 100
Inference:
Most of the dealers were highly satisfied by the timely delivery of Crompton
decorative fans of which 48 % were highly satisfied, 38.7 % rated it satisfied and 5.3% of
them marked it Average. Thought 8 % of them were dissatisfied none of the dealer were
highly dissatisfied.
74
Fig.6.10. OPINION ABOUT TIMELY DELIVERY OF CROMPTON
DECORATIVE FANS
6..11. OPINION REGARDING EMPLOYEES OF CROMPTON
GREAVES
OPINION REGARDING EMPLOYEES OF CROMPTON GREAVES
Sl. No. Criteria No. of respondents % of respondents
1. Highly Satisfied 37 49.3
2 Satisfied 28 37.3
3 Average 7 9.3
4 Dissatisfied 3 4
5 Highly Dissatisfied 0 0
Total 75 100
75
Inference:
Majority of the dealers were highly satisfied by employees of Crompton. More
than 49 % of the dealers were highly satisfied, More than 37 % of the dealers were
satisfied and 9.3 percent f the dealers rated it average. Though no dealers were highly
dissatisfied 4 % of the dealers were found dissatisfied
Fig.6.11. OPINION REGARDING EMPLOYEES OF CROMPTON
GREAVES
.
76
6.12. OPINION REGARDING AFTER SALES SERVICE OF CROMPTON
DECORATIVE FANS
OPINION REGARDING AFTER SALES SERVICE OF CROMPTON
DECORATIVE FANS
Sl. No. Criteria No. of respondents % of respondents
1 Highly Satisfied 29 38.7
2 Satisfied 29 38.7
3 Average 14 18.7
4 Dissatisfied 3 4
5 Highly Dissatisfied 0 0
Total 75 100
Inference :
Majority of the dealers found to be happy with the aftersales service of Crompton
greaves . 38.7 % were Highly satisfied and 38.7 % of them were found satisfied/ 18.7 %
of the dealers found the aftersales service to be average and 4 % of them were dissatisfied
but none of them were highly dissatisfied.
77
Fig. 6.12 OPINION REGARDING AFTER SALES SERVICE OF CROMPTON
DECORATIVE FANS
6.13. OPINION REGARDING AVAILABILITY OF CROMPTON DECORATIVE
FANS
OPINION REGARDING AFTERSALES SERVICE OF CROMPTON
DECORATIVE FANS
Sl. No. Criteria No. of respondents % of respondents
1 Very Good 26 34.3
2 Good 28 37.3
3 Average 14 18.7
4 Poor 7 9.3
5 Very Poor 0 0
Total 75 100
78
Inference:
37.3 % of the dealers mentioned that the availability of the Crompton greaves fans
is good. More than 34 % of the dealers mentioned that the availability is Very good and
18.7% of them said that the availability was average. Although none of the dealers
mentioned about very poor availability 9.3% of them mention it to be poor.
Fig6.13. OPINION REGARDING AVAILABILITY OF CROMPTON
DECORATIVE FANS
79
6.14. AREAS FOR BOOSTING PREMIUM DECORATIVE FAN
RANGE.
AREAS FOR BOOSTING PREMIUM DECORATIVE FAN RANGE.
Sl. No. Criteria No. of respondents % of respondents
1 Promotional 20 26.7
2 Sales 15 20
3 Follow up 9 12
4 Service 22 29.3
5 Credit facility 9 12
Total 75 100
Inference:
Most of the dealers ( 29.3% ) mentioned that Service can be a bit more early, 26.7
% of the dealers found that more importance should be given to promotional activities. 20
% of the dealers mentioned a help in Sales can improve the Premium Decorative fan
range. 9% of the dealers mentioned the need for help in credit facility and rest 12 %
specified follow up as a way for improving the Premium decorative range.
80
Fig.6.14.AREAS FOR BOOSTING PREMIUM DECORATIVE FAN
RANGE.
81
6.15. OVERALL OPINION OF DEALER SATISFACTION OF CROMPTON
DECORATIVE FANS
OVERALL OPINION OF DEALER SATISFACTION OF CROMPTON
DECORATIVE FANS
Sl. No. Criteria No. of respondents % of respondents
1 Highly Satisfied 25 33.3
2 Satisfied 39 52
3 Average 10 13.3
4 Dissatisfied 1 1.3
5 Highly Dissatisfied 0 0
Total 75 100
Inference :
Majority of the dealers were happy with their dealership with Crompton greaves.
No dealer was highly dissatisfied by their Crompton dealership. 33.3 were Highly
Satisfied with the dealership and 52 % of them were satisfied. More than 13 % of the
dealers gave an average rating for the dealership and 1.3% of the dealers were found
dissatisfied.
82
Fig.6.15. OVERALL OPINION OF DEALER SATISFACTION OF CROMPTON
DECORATIVE FANS
83
6.2STATISTICAL ANALYSIS
Hypothesis 1
H0 :Brand name does not affect the overall satisfaction.
H1 : Brand name does affect the overall satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
DealerSatisfaction *
Brandname 75 100.0% 0 0.0% 75 100.0%
DealerSatisfaction * BrandnameCrosstabulation
Count
Brandname Total
3 4 5
DealerSatisfacti
on
2 0 0 1 1
3 5 2 3 10
4 6 24 9 39
5 5 8 12 25
Total 16 34 25 75
Chi-Square Tests
Value df Asymp. Sig.
(2-sided)
84
Pearson Chi-Square 14.053a 6 .029
Likelihood Ratio 13.470 6 .036
Linear-by-Linear
Association 1.493 1 .222
N of Valid Cases 75
a. 6 cells (50.0%) have expected count less than 5.
The minimum expected count is .21.
Symmetric Measures
Value Approx.
Sig.
Nominal by
Nominal
Phi .433 .029
Cramer's
V .306 .029
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming
the null hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is more than the cut off value (0.05) , therefore
the null hypothesis is H0 accepted and the H1 is rejected i.e Brand name does not affect
the Dealer satisfaction.
85
Hypothesis 2
H0 :Product quality does not affect the overall satisfaction.
H1 : Product quality does affect the overall satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Quality 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * Quality Crosstabulation
Count
Quality Total
Average Good Very Good
Overalsatsfn
Poor 0 0 1 1
Average 3 5 2 10
Satisfied 8 15 16 39
Highly Satisfied 2 11 12 25
Total 13 31 31 75
Chi-Square Tests
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 5.502a 6 .481
86
Likelihood Ratio 6.225 6 .398
Linear-by-Linear
Association 1.755 1 .185
N of Valid Cases 75
a. 7 cells (58.3%) have expected count less than 5. The
minimum expected count is .17.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .271 .481
Cramer's V .192 .481
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is more than the cut off value (0.05) , therefore
the null hypothesis H0 accepted and the H1 is rejected i.eProduct quality does not affect
the Dealer satisfaction.
87
Hypothesis 3
H0 :Credit period does not affect the overall satisfaction.
H1 : Credit does affect the overall satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Credit 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * Credit Crosstabulation
Count
Credit Total
Poor Average Good Very
Good
Overalsatsfn
Poor 1 0 0 0 1
Average 3 4 2 1 10
Satisfied 2 20 15 2 39
Highly
Satisfied 3 3 13 6 25
Total 9 27 30 9 75
Chi-Square Tests
88
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 24.634a 9 .003
Likelihood Ratio 22.167 9 .008
Linear-by-Linear
Association 9.706 1 .002
N of Valid Cases 75
a. 12 cells (75.0%) have expected count less than 5. The
minimum expected count is .12.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .573 .003
Cramer's V .331 .003
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is less than the cut off value (0.05) , therefore
the null hypothesis H0 rejected and the H1 is accepted i.e Credit period does affect the
Dealer satisfaction.
89
Hypothesis 4
H0 :Promotional activities does not affect the overall satisfaction.
H1 : Promotional activities does affect the overall satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Promotion 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * Promotion Crosstabulation
Count
Promotion Total
Poor Average Good Very
Good
Overalsatsf
n
Poor 1 0 0 0 1
Average 5 5 0 0 10
Satisfied 3 20 14 2 39
Highly
Satisfied 3 5 7 10 25
Total 12 30 21 12 75
Chi-Square Tests
90
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 35.548a 9 .000
Likelihood Ratio 34.909 9 .000
Linear-by-Linear
Association 19.359 1 .000
N of Valid Cases 75
a. 10 cells (62.5%) have expected count less than 5. The
minimum expected count is .16.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .688 .000
Cramer's V .397 .000
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is less than the cut off value (0.05) , therefore
the null hypothesis H0 rejected and the H1 is accepted i.e Promotional activities does
affect the Dealer satisfaction.
91
Hypothesis 5
H0 Timely delivery of goods does not affect the overall satisfaction.
H1 : Timely delivery of goods does affect the overall satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Tmlydelivry 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * TmlydelivryCrosstabulation
Count
Tmlydelivry Total
Poor Average Satisfied Highly
Satisfied
Overalsatsf
n
Poor 1 0 0 0 1
Average 3 1 4 2 10
Satisfied 2 1 20 16 39
Highly
Satisfied 0 2 5 18 25
Total 6 4 29 36 75
Chi-Square Tests
Value df Asymp. Sig.
(2-sided)
92
Pearson Chi-Square 30.146a 9 .000
Likelihood Ratio 23.662 9 .005
Linear-by-Linear
Association 15.916 1 .000
N of Valid Cases 75
a. 12 cells (75.0%) have expected count less than 5. The
minimum expected count is .05.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .634 .000
Cramer's V .366 .000
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is less than the cut off value (0.05) , therefore
the null hypothesis H0 rejected and the H1 is accepted i.e Timely delivery of goods does
affect the Dealer satisfaction.
93
Hypothesis 6
H0 Employee interactions with the dealer does not affect the overall
satisfaction.
H1 Employee interactions with the dealer does affect the overall
satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Employees 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * Employees Crosstabulation
Count
Employees Total
Poor Average Satisfied Highly
Satisfied
Overalsatsf
n
Poor 0 0 1 0 1
Average 1 3 5 1 10
Satisfied 2 3 17 17 39
Highly
Satisfied 0 1 5 19 25
Total 3 7 28 37 75
94
Chi-Square Tests
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 19.004a 9 .025
Likelihood Ratio 19.916 9 .018
Linear-by-Linear
Association 13.264 1 .000
N of Valid Cases 75
a. 12 cells (75.0%) have expected count less than 5. The
minimum expected count is .04.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .503 .025
Cramer's V .291 .025
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is less than the cut off value (0.05) , therefore
the null hypothesis H0 rejected and the H1 is accepted i.e Employee interactions with the
dealer does affect the Dealer satisfaction.
95
Hypothesis 7
H0 : After sales service does not affect the overall satisfaction.
H1 : After sales service does affect the overall satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Aftrsales 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * AftrsalesCrosstabulation
Count
Aftrsales Total
Poor Average Satisfied Highly
Satisfied
Overalsatsf
n
Poor 1 0 0 0 1
Average 0 6 2 2 10
Satisfied 2 6 18 13 39
Highly
Satisfied 0 2 9 14 25
Total 3 14 29 29 75
Chi-Square Tests
96
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 41.068a 9 .000
Likelihood Ratio 22.057 9 .009
Linear-by-Linear
Association 12.699 1 .000
N of Valid Cases 75
a. 11 cells (68.8%) have expected count less than 5. The
minimum expected count is .04.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .740 .000
Cramer's V .427 .000
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference:
Since the Asymp. Sig. (2-sided) value is less than the cut off value (0.05) , therefore
the null hypothesis H0 rejected and the H1 is accepted i.e After sales service does affect
the Dealer satisfaction.
97
Hypothesis 8
H0 : Availability of products during season does not affect the overall
satisfaction.
H1 : Availability of products during season does affect the overall
satisfaction.
Crosstabs
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Overalsatsfn *
Availablty 75 100.0% 0 0.0% 75 100.0%
Overalsatsfn * AvailabltyCrosstabulation
Count
Availablty Total
Poor Average Good Very
Good
Overalsatsfn
Poor 0 1 0 0 1
Average 5 3 2 0 10
Satisfied 1 9 21 8 39
Highly
Satisfied 1 1 5 18 25
Total 7 14 28 26 75
98
Chi-Square Tests
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 50.165a 9 .000
Likelihood Ratio 44.007 9 .000
Linear-by-Linear
Association 27.294 1 .000
N of Valid Cases 75
a. 11 cells (68.8%) have expected count less than 5. The
minimum expected count is .09.
Symmetric Measures
Value Approx. Sig.
Nominal by Nominal Phi .818 .000
Cramer's V .472 .000
N of Valid Cases 75
a. Not assuming the null hypothesis.
b. Using the asymptotic standard error assuming the null
hypothesis.
Inference :
Since the Asymp. Sig. (2-sided) value is less than the cut off value (0.05) ,
therefore the null hypothesis H0 rejected and the H1 is accepted i.e Availability of
products during season does affect the Dealer satisfaction.
99
CHAPTER 7
FINDINGS, SUGGESTIONS AND CONCLUSION
100
7.1FINDINGS
Almost all dealers of Crompton greaves Premium decorative fans are satisfied with
their dealership.
It can be seen that more than half of the dealers in Ernakulam district had experience
as a Crompton greaves dealer for more than 10 years.
Many dealers were electrical retailers
Majority of the dealers dealt with competitors of Crompton Greaves such as Havells,
Orient, Usha, Bajaj, Khaitan, Polar and other brands such as Almonard,,Impexetc
,indicating that there is high market competition.
It is found that majority of the dealers consider the Brand name and Product Quality
of Crompton Greaves fans to be the highest available in the market.
It is found that majority of the dealers have not used any form of advertisements for
promoting decorative fan range and depended highly on advertisements by the
company alone.
Very few dealers are using advertisements on their own consisting of posters and
hoardings.
Margin of Crompton greaves decorative fans is considered to be average compared to
other brand. Almost 12 % of the dealers have indicated dissatisfaction with the
present margin.
Majority of the dealers consider the current promotional activities done for Crompton
greaves decorative fans as average and a few even consider them to be poor.
Most of the dealers consider discount more than offers , gifts and prizes
Majority of the dealers are highly satisfied by the availability and timely delivery of
Crompton decorative fans , even when the demand is high
Majority of Dealers were impressed with the employees of Crompton greaves that
they come into contact with.
Although dealers think the aftersales service of Crompton greaves fans are excellent
few dealers mentioned that Servicing of the complaints should be made more fast
101
20 % of the dealers mentioned a help in Sales can improve the Premium Decorative
fan range.
9% of the dealers wanted better credit periods.
Through statistical analysis the factors that affecting dealer satisfaction were found as
credit period, promotional activities,timely delivery of goods,employee interaction
with the dealer, after sales service and availability of products.
Dealers mentioned existence of duplicates in the market.
Dealers mentioned the presence of price difference in the market
Dealers are uninformed regarding few of the models available within the premium
decorative range.
102
7.2SUGGESTIONS
As some dealers have mentioned their dissatisfaction with the after sales servicing
of Crompton Greaves fans, facilitating speedy spot servicing is suggested.
There are only very few exclusive dealers for Crompton greaves in Ernakulam
district, therefore having exclusive dealership can be helpful for the company.
Majority of the Crompton Greaves dealers depend solely on company
advertisement for making sales which mainly consist of hoardings and bill
boards .Encouraging the dealers to advertise the Crompton Greaves fans in
collaboration with the company by word of mouth and Point-of-purchase displays
etc. can make positive differences in the sales.
12% of the dealer mentioned that margin received is average compared to other
brands. This could be due to the price difference that exist in the market.Hence,
the existence of price differences in the market is to be checked and controlled by
the company by maintaining strict price standardization.
Dealer meets, trade allowances and push money can be good promotional
techniques to boost the morale of the dealers.
The existence of duplicates in the market should be checked and dealt with using
methods such as holograms, Unique bar coding etc.
Few dealers have mentioned their displeasure with the availability of the fans
during seasons of high demand. A suitable method should be adopted to forecast
the dealer‘s demand. For example opening an online portal showing the current
stock levels with each dealer can be an effective solution.
Having a separate website where the Crompton Greaves fan dealers can enter
using a separate user name and password thereby creating a platform for them to
interact among each other and the company alike can be a cost effective way to
maintain the dealer‘s morale.
.
103
7.3. CONCLUSION
In today‘s economy all manufacturers need to pay attention on how to buildstrong
long-term relationships with their dealers ‗chain..For a manufacturing company, in order
to satisfy its customers, it is highly important to satisfy its dealers, as they are the direct
customers to them. Establishing satisfaction as the ultimate goal, is like the other ultimate
goals of business pursuit of higher profits or shareholders wealth. Perfect dealer service or
satisfaction is one that meets the combined need satisfaction.
The Study on dealer satisfaction of Crompton greaves premium decorative ceiling
fans in Ernakulam district helped in understanding the level of satisfaction of fan
dealers.Another purpose of the study was to measure the factors affecting the dealer
satisfaction.The study helped in having a better understanding about Premium decorative
fan market in Ernakulam district and about the dealer network of Crompton greaves fans.
Most of the dealers have good opinion about the brand and quality of Crompton greaves.
Majority of the dealers are impressed by the timely delivery and employeesinteractionson
part of the company.The study revealed that satisfaction of Crompton Greaves premium
decorative fans dealers is good.
Statistical analysis of the hypotheses revealed that overall satisfaction of the
dealers were affected by the factors such as credit period, promotional activities, timely
delivery of products, employees interaction with the dealer, after sales service and
availability of products during seasons of high demand.Study revealed few areas that
need continuedattention from the company such as advertising,sales, credit facilities,
better promotion, speedy serviceetc. These factors can be crucial for further success of the
company.
Understanding the needs of the dealers beforehand and making adequate efforts to
meet those needs on time are crucial for the growth and success of Company‘s business.
Dealer satisfaction is a systemized service that involves the entire organization. This
study helped in measuring and understanding those factors which affected dealer
satisfaction and to estimate the overall satisfaction of Crompton greaves Premium
decorative fan dealers.
104
BIBLIOGRAPHY
Books
Principles of marketing,PhilipKotler& Gary Armstrong
Marketing research -Principles applications & Cases, D.D. Sharama& G.C. Beri
Statistical tools, S.P. Gupta
Research methodology,C.R. Kothari
Basic marketing, William G.Zikmund, Michaell d. Amico.
Websites
www.google.com
www.cgglobal.com
www.jdpower.com
Journals
1. Sontaki, S. N. (1999). Marketing Management - In the Indian background (1/e).
New Delhi: Kalyani Publishers, 209.
2. Cateora, PR& Graham (2004), International Marketing, McGraw-Hill.
3. Corsten, D. & Kumar, N. (2005) 'Do suppliers benefit from colloborative
relationships with large retailers? An Empirical investigation of efficient consumer
response action'
4. Leonidou, L. C., Palihawadana, D., &Theodosiou, M. (2006) 'An integrated model
of the behavioural dimensions of industrial buyer-seller relationships', European
Journal of Marketing‖
5. Gassenheimer, J. B., & Ramsey, R. (1994) 'The impact of dependence on dealer
satisfction: A comparison of reseller-supplier relationships', Journal of Retailing
6. Theng-Lau, G., &Goh, M. (2005) 'Buyer-seller relationship in PCB industry',
Supply Chain Management: An International Journal, vol. 10, no. 4, pp. 302-312
105
7. Adul-Muhmin, A. G. (2002) „Effects of suppliers' marketing program variables on
industrial buyers' relationship satisfaction and commitment‟, Journal of Business &
Industrial Marketing.
8. Nor Azila, M.N., Selvan, P.a, Zolkafli, H.b (2011) ―Globalization in the
automobile industry: how supplier-dealer relationship could be effectively managed?‖
9. Norris Bruce, Preyas Desai, Richard Staelin, (January, 2004)
10. ‖J.D. Power Asia Pacific 2012 India Dealer Satisfaction with Automotive
Manufacturers Index Study‖
11. Md. AslamUddin (August 2012) ―Factors Responsible to Dealers‘ Satisfaction: A
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Vol. 2. No. 5.
106
APPENDIX
107
QUESTIONNAIRE
A study on dealer satisfaction of Crompton Greaves Premium decorative ceiling fans in
Ernakulam District
Name :
Address :
1. How long you are dealing with the Premium range of Crompton Greaves products?
1-3 years 4-7 years 8-10 years above 10 years
2. Are you dealing with Premium range decorative fans of other companies?
Yes No
If Yes, specify BRANDS__________________________________
3. Which factor enables you to be the dealer of Crompton Premium decorative ceiling
products?
Promotion Schemes Company Policy Margin Brand Name
Availability timeliness of delivery Product quality Price Credit
period
4. How do you feel about the brand Crompton Greaves?
Very Good Good Average Poor Very Poor
108
5. How do you feel about Quality of Premium decorative ceiling fans of Crompton?
Very Good Good Average Poor Very Poor
6.Do you have any advertisements for boosting the volume of sale of the Premium range
fans?
Yes No
7.Mention the Pattern of the advertisements?
Independently by the shop In collaboration with the company
Solely by the company
8. How do you rate the Profit margin from Crompton greaves premium decorative
ceiling fans against other brand’s .
Very Good Good Average Poor Very Poor
9. What do you feel about credit period given by Crompton for the Premium Decorative
ceiling fans?
Very Good Good Average Poor Very Poor
10. How do you rate the Promotional Activities given by Crompton?
Very Good Good Average Poor Very Poor
11. What type of promotional activity do you prefer with Crompton products?
Discount Gift Prize Offers Others
(Specify)……………..
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12. How do you feel about the timely Delivery of the Premium decorative ceiling fans of
Crompton?
Highly Satisfied Satisfied Average Dissatisfied
Highly Dissatisfied
13. What do you feel about the employees dealing with you in Crompton?
Highly Satisfied Satisfied Average Dissatisfied
Highly Dissatisfied
14. What are the factors that you expect from Crompton for boosting the Premium
Decorative ceilingfans ?
Promotional Sales follow-up Scheme Service
Credit Facility
Others____________________________
15. What do you feel about after sales service given by Crompton?
Highly Satisfied Satisfied Average Dissatisfied
Highly Dissatisfied
110
16.How is the availability of premium decorative ceiling fans during seasons?
Very Good Good Average Poor Very Poor
17.What is your opinion regarding the dealership network of Crompton?
Highly Satisfied Satisfied Average Dissatisfied
Highly Dissatisfied
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