CERTIFICATE
This is to certify that RAMESH KUMAR, PGDM (Second Year) of Institute of
Management Education, Sahibabad, Ghaziabad has done his Summer Project –
GAUGING THE SALES POTENTIAL OF DIESEL ENGINE SETS IN
RAJASTAHN WITH SPECIFIC REFERENCE TO 15-40HP ENGINES – in
EICHER TRACTORS, FARIDABAD under my guidance. The duration of the
project work was two months i.e. from 1st May 2003 to 30th June 2003.
Date: (RAMESH KINI)Dy. Marketing Manager
Eicher Tractors59, NIT, Faridabad
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ACKNOWLEDGEMENT
The project “Gauging the sales potential of 15-40 HP Diesel Engine sets in Rajasthan”,
has been undertaken, in partial fulfillment of the requirements of Post Graduate
Diploma in Management (PGDM) offered by Institute of Management Education,
Ghaziabad. The project has been done at Eicher Tractors, a unit of Eicher Limited,
Faridabad. I take this opportunity to thank Prof. H.P. Gupta, Director, IME for
providing me an opportunity to take this project work. I would also like to thank Mr.
Srikant Kapoor, Faculty, IME, for providing guidance during the project. And, above
all I would like to thank Mr. Ramesh Kini, Deputy Marketing Manager, Eicher
Tractors, who was my project guide and was closely associated with the project right
from the beginning and under whose supervision and guidance whole of the project has
been completed. My sincere thanks also goes to those dealers who participated in the
survey work, and people of Rajasthan, who selflessly revealed several information,
without which I would not have been able to unravel several mysteries of the engine
world, which is now part of this report.
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SYNOPSIS
The aim of the project is to gauge the sales potential of 15-40 HP engines in
Rajasthan.
Research work is based upon the response of questionnaire containing open and
closed ended questions, alongwith statements to be rated on Likert scale.
Business cycle of 10 years has been detected which can predict phases of growth
in number of dealers in Rajasthan.
Market estimate with per annum sales figure in 12 districts of Rajasthan found
out.
Market segments in engine sale were identified.
Customer behaviour in purchase of engine gauged.
Warranty / service policy of different companies are examined.
Relative competition ratio among 3 segments of engine sales viz.
0-14 : 15-40 : >40 is found to be 1 : 4 : 2.
Brand equity in Rajasthan has been found out Kirloskar > Field Marshal >
Topland > Eicher ………..
Extent of territorial infringement and several policies to combat infringement viz.
Kirloskar’s, Topland’s etc.
In sufficient availability of finance for purchase of engines from various banks.
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INTRODUCTION
“Gauging the sales potential of 15-40HP diesel engine sets in Rajasthan”, is a
comprehensive analysis of the engine world, compiling most of information, about
growth in number of dealers over year, completion of brands, incentives to dealers,
buying and selling strategies, brand USPs, sales potential of different regions, business
market of dealership and relative completion and sales potential of different segments of
engine sales. The project report is based upon a comprehensive survey work done in
Rajasthan during a period of about 45 days’ stay in Rajasthan. Areas visited were, Jaipur,
Sikar, Dausa, Kota, Baran, Bundi, Jodhpur, Pali, Jalore, Dhorimanna, Sanchore and
Alwar. A separate survey of customers has been done to reveal the consumers’ buying
behavour. Analysis is based on a questionnaires response. Accordingly the brand order,
extent of infringement, sales potential of regions has been gauged. All the figures are
arrived at using scientifically approved statistical tools, on which inference of each
question is also based. Limitations and errors if any, are inherent to these statistical tools.
All the conclusions arrived at are honestly based on this methodology and does not
include any bias with respect to brand and region.
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COMPANY PROFILE OF EICHER
5
AN OVERVIEW
Eicher began its business operations in 1959 with the roll out of India's first tractor. Today the Eicher Group is a significant player in the Indian automobile industry with a gross sales turnover of over Rs. 13,700 million in the year 2002-03.
The Eicher Group has diversified business interests in manufacturing & marketing of Tractors, Commercial Vehicles, Automotive Gears, Motorcycles, and exports of vehicles, aggregates and components. Eicher has also invested in the potential growth areas of Management Consultancy Services. The activities of the Group are divided into the following business units covering all the business interests.EICHER LIMITED
- EICHER TRACTORS - Tractors- ROYAL ENFIELD - Motorcycles- EICHER DEMM - GearsEICHER MOTORS LIMITED - Commercial VehiclesEICHER INTERNATIONAL LTD - ExportsECS LTD. - Management ConsultancyEicher has over 5000 employees located in 10 manufacturing facilities and 24 marketing offices all around the country. The Group has around 950 vendors supplying components and sub-assemblies which testifies to the strength of the vendor base. The Group's products are brought to the customer through its network of around 800 dealers distributed across the length and breadth of the country.
E
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EICHER TRACTORS
The Eicher Group started in 1948 when the Goodearth Company was set up to sell and service imported tractors in India. Perceiving an urgent need to mechanise Indian agriculture, the Company set up a tractor manufacturing facility, Eicher Tractors Limited in 1959 in collaboration with Gebr. Eicher, Germany in India. The first Indian tractor rolled out of Eicher's factory at Faridabad in India, in 1960.
Today, there are over 4,00,000 Eicher tractors that contribute to the nation's agricultural development. Eicher's manufacturing and marketing facilities located at Faridabad have been awarded ISO 9001 certification.
Eicher Tractors has a technology transfer tieup with Valtra, Inc of Finland. It has an extensive network of over 400 tractor dealers and around 56 engine dealers across India with 15 regional offices and 12 depots.
Committed to providing high quality products, Eicher invests significantly in technology resources and infrastructure. Our manufacturing facilities are spread across three states :
Location AddressArea (sq. mtrs)
Annual Production Capacity
Faridabad59 NIT FaridabadHaryana - 121 001India
12500 30000 tractors
AlwarItarana Road, Alwar Rajasthan - 301 001India
11400 42000 engines
Bhopal
Plot No. 1, Sector D, Industrial Area, Mandideep - 462 046 District: Raisen (MP)India
63640 18000 tractors
Highlights Wide range of tractors, from 61 HP to 24 HP offering the best value for
money. Product range includes air cooled and water cooled engines. Highly fuel efficient machines, with low maintenance costs. Conforming to international emission norms.
Product range also includes engines in the 22 HP to 32 HP and gensets in the 15 KVA to 30 KVA categories.
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EICHER MOTORS
Eicher Motors Limited (EML) was incorporated in 1982 and introduced its first product, the Canter, a 6 ton GVW truck manufactured at its state of the art plant at Pithampur, Indore in collaboration with Mitsubishi Motors Corporation, Japan, in 1986. The maiden offering soon created a strong customer base for itself.
From a single 6 Ton GVW truck in 1986, our range today extends from 5T to 16T GVW trucks and the Skyline and Voila range of Buses. All our products can be offered in BS II compatible options. We also have arguably the best CNG technology in the world in our CNG Buses. Pioneering the concept of Built Up vehicles in the country, we make products that consistently deliver high value to our customers and are increasingly becoming the preferred option for all CV users, not only in India but overseas too. Eicher CVs today have significant presence in more than 20 countries across the world.
In India, Eicher Motors has consistently outperformed the industry in terms of growth and currently holds over 30% market share in the 6T-11T GVW segments. In the 9T GVW segment, Eicher Motors continues to be the leader with more than 50% market share. Our well-equipped workshops result in faster turnaround of service. A network of more than 4500 Eicher trained private mechanics, over 133 authorized sales and service centres, and easy availability of genuine parts across more than 300 authorized spares outlets means less downtime and increased opportunities for our customers to earn.
Eicher Motors is now poised to further consolidate its position in the CV industry by entering into the Medium & Heavy Commercial Vehicle segments. Strategic plans are in place to ensure necessary investments in technology and training to constantly sharpen our development and manufacturing edge. EML is totally committed to fulfilling the vision of being one of the top 3 CV manufacturers in the country by giving customers what they want: vehicles that are safe, fuel efficient, easy to maintain, enhance driver comfort and in turn productivity. Vehicles that deliver value by providing low cost of ownership and increased profitability to our customers.
THE EML ADVANTAGE
Technological ExpertiseExtensive NetworkCustomized ApplicationsEfficient cost of ownership ExportsVehicle Financing
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Technological Expertise
Our products are manufactured at the Company's plant in Pithampur, near Indore, Madhya Pradesh, India. The company has absorbed the technology and has successfully indigenised the vehicles.
To ensure that we continue to create products that offer unique advantages and benefits to our customers, Eicher Motors Limited has set up a Product Development group, consisting of competent engineers. The team has developed several successful vehicles and variants, an achievement made possible by the use of the latest Computer Aided Design and Computer Aided Engineering (CAD-CAE) software like NASTRAN and FEM analysis packages.
Extensive Network
Eicher Motors Limited provides its customers the benefit of an extensive sales and service network, customised solutions and an efficient cost of ownership.
Our manufacturing capabilities are backed by a sales and service network of over 133 EML authorised sales & service centers and more than 300 authorised spares outlets.
The three-tier service network consists of:
Authorised distributors in metros and cities. 133 Authorised Service Centre's. Over 4500 company trained private mechanics.
Service highlights: Eicher Genuine Spares - available across all Eicher dealerships, service
centers, spares distributors, satellite service outlets and retail outlets.300 authorized spares outlets throughout the country.
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A strong and wide dealer network Grass-root level penetration through training to popular local mechanics,
currently numbering over 4500 nationwide. Fully equipped modern workshops for fast and experienced service. Driver-Safety training programmes for drivers of corporate and institutional
customers. Free vehicle check-up camps, organised regionally. A Comprehensive Service Audit System, which oversees the physical
infrastructure, ensures understanding and compliance with the system and provides training and technical updates.
Customized Applications
Eicher specializes in offering ready-to-use custom-built application vehicles to suit customer needs, in addition to the normal range of vehicles. Adaptation of product specifications to suit local regulations and norms is an integral part of the process.
All Eicher exports to the Middle East meet Gulf Council Countries(GCC) specifications, have power steering and air-conditioned cabins. A breakthrough in our record as solution providers came when Eicher developed a cargo deck of a composite material of Wood and Steel, called Metawood. Metawood is lighter and more elegant, and vehicles fitted with these have more load capacity and yield higher fuel efficiency. We also specially manufacture Commuter and Tourist Buses suited for African markets. Our Commuter buses are designed for larger passenger carrying capacities and to withstand tough road conditions.
Efficient Cost of Ownership
Eicher vehicles not only prove to be safe but also a profitable business investment.
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This is a result of the engineering, maintenance and safety features built-into each Eicher vehicle. We call this the efficient cost of ownership of an Eicher vehicle.
Some of the highlights are:
A Tiltable Cab for easy reach during routine and periodic service check-ups. An Automated Exhaust Braking system that activates the brakes
automatically on deceleration, allowing for more driver control. A collapsible steering wheel. Adjustable seats for ergonomic comfort, thus reducing road fatigue. An aerodynamic design and a highly fuel efficient engine, that make it the
most fuel efficient vehicle in its class.
Exports
Eicher Motors markets its range of Commercial Vehicles and customized applications to over 28 countries across the world.
Vehicle Financing
Eicher has arrangements with a number of key Non Banking Financial Companies and Financial Institutions to help our customers to avail finance for the purchase of vehicles. Eicher also provides customer finance through Auto Finance Company, a division of EML.
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EICHER DEMM
Eicher Demm (formerly Ramon & Demm) was set up in 1964, in technical collaboration with Fratelli Daldi and Mattueucci of Italy - the makers of the famed Demm gears. In 1992, the Eicher Gear Business expanded with the takeover of the Ramon & Demm plant at Thane, Mumbai.
At present the Gear Business has two plants - at Thane, and Parwanoo in Himachal Pradesh - which collectively manufacture a spectrum of gear solutions which include:
Spiral and Hypoid Gears (Crown Wheel and Pinion) Straight Bevel Gears Spur and Helical Gears Cam Shafts Precision Machined Components Machined Housings
Royal Enfield
Classic Bikes with power for leisure riding is what a Royal Enfield bike stands for, and Royal Enfield leads this segment of the market in India by leaps and bounds. Its exquisite range of motorcycles combines distinctive styles with power, riding comfort and ruggedness to deliver a unique motorcycling experience.
The Beginning
Royal Enfield India was set up in 1955 when it started receiving 350cc bikes in kits from the UK and assembling them in Chennai, India. But, eventually the entire bike was manufactured in India and a couple of years later the Company started manufacturing the 500cc Bullet. By its sheer power, unmatched stability, superior riding comfort and rugged good looks, the Bullet dominated and continues to dominate the Indian roads. It is the dream choice of every motorcyclist in India with even the Indian Army and Police endorsing the Bike.The Eicher Chapter
In 1990, Royal Enfield entered into a strategic alliance with the Eicher Group, and later merged with Eicher Group in 1994. The Eicher Group, is one of India's leading automotive group with diversified interests in the manufacture of Tractors, Commercial Vehicles, Automotive Gears, Exports, Garments, Management Consultancy and Motorcycles.
Since then, the Company has made considerable investments in modernizing its
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manufacturing technology and systems and in 1996, when the Government decided to impose stringent norms for emission Royal Enfield was the first motorcycle manufacturer to comply. Royal Enfield is amongst the first few Indian companies to obtain the WVTA (Whole Vehicle Type Approval) for meeting the European Community norms.
Royal Enfield - revving up
With the finest and brightest of teams in the country, comprising of management professionals and a skillful, committed workforce, the Company has a unique and open culture, making Royal Enfield a vibrant and responsive company. To its customers in India and elsewhere in the world, Royal Enfield means more than just motorcycles… it is a sense of belonging to an exclusive community with unfading passion, emotion and interest. The Company, is all set to augment its leadership position, be it in the power and leisure bike segment in India or the classic bike segment elsewhere in the world, by introducing distinctively styled and higher-powered motorcycles, strengthening existing communities around its products, expanding its network, and delivering a unique motorcycling experience.
Maps & Travel Guides
Good Earth Publications specializes in the publication of world-class travel guides and maps. These publications reflect excellence in editorial content and high production value, and are benchmarked against the best available publications in the world. A highly professional team of editors, cartographers, designers and production personnel have got together to bring out these world class travel guides and maps.
Good Earth Publications is the only Indian publishing house which publishes highly visual guidebooks based on research both on historical and architectural details as well as hands-on collection of all data relating to travellers' needs.
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GIS SERVICES & SOLUTIONS
GIS division was formalised in Dec 2000, with the Ministry of Defence, Government of India , according approval to Eicher for licencing our digital maps of Delhi and satellite towns.
Eicher now offer GIS products and services that cater to a wide spectrum of applications in the corporate, and in the infrastructure development segments.
Its services in Digital Cartography include turnkey projects involving the entire gambit of activities from surveying and mapping to creation of a GIS, and setting up a enterprise GIS facility for applications in Transportation, Municipal, Electric, Water and Gas utilities.
EICHER ENGINEERING SOLUTIONS
Eicher has been delivering engineering solutions to our clients for over 5 years. The focus of our operations is to enable our customers to bring their quality products to market in the shortest possible time. We achieve this through a pool of highly qualified professionals who have honed their skills with live implementation experience in Concept to Prototype Delivery with Product Design and Development, Engineering Analysis and Software Services.
Eicher is uniquely poised with experience in the automotive area to ideate, design and deliver virtual and physical prototypes and products. Highly driven by customer requirements it deliver turnkey projects on design and development, providing high quality, rapid time-to-market solutions.
Its Delivery Process is built to translate the customer requirements into delivery specifications with quality checks. Project teams handle the customer orders with strong adherence to schedules in a professional manner ensuring complete confidentiality. Its networked locations ensure optimum use of specialised systems and resources.
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RESEARCH METHODOLOGY
This project work is based on response of a questionnaire which included a variety of
questions both open ended and closed. A separate questionnaire on likert scale had also
been made. The response was taken during one to one interview with dealers of
Rajasthan. The response has been statistically analysed, to make out the conclusions of
the findings. Consumer behaviour has been gauged by surveying the real users of the
diesel engine sets in villages and quarrying about their preferences and constraints while
purchasing a diesel engine set.
Size of Sample = 51
To know about the financing of engines survey work in banks has also been done. The
banks visited are:
Jodhpur Central Cooperative Bank
Rural Bank (Gramin Bank)
Thar Aanchalik Bank
UCO Bank
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QUESTIONNAIRE
Name:
Address:
Telephone No.:
E-mail:
Fax:
1.For how many years you are in this business
------------------2.Please indicate the range of engines you are dealing in
a)0-14HP b)15-40HP c)>40HP
3.Rank in order , the range of engines contributing to your sale during last three years.
a)0-14HP b)15-40HP c)>40HP
Vol . vol . vol .
Please answer the following questions with specific reference to the range of 15-40hp engines only
4.Which type of engines are available with you in this range.a)air cooled b)water cooled c)both
5.Please indicate the price range in which 15-40 hp engines are available.
Rs--------------- RS--------------- Rs---------------
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6.Is there any other dealer in your territory? Yes / no
If yes, then please name them,
1______________________2______________________3____________________
7.1Please rank in order the name of competitors in your territory.
1…………………………………… 2………………………………….. 3………………………………….. 4………………………………….. 5…………………………………..
7.2 Why people prefer the brand you are dealing in against other brands available in the market
7.3 why do people buy the No. 1 brand
8.Please explain the kind of strategy adopted by you to sell i.e., competitive pricing ,infringement,borrowed from the company's policy.e.g.:-credited / market support by the company / field activities
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9.Please explain how do you manage infringement.
10.Please , explain how do you perceive future of your product in market.
11.What are the warranty / after sales service contract available with you ?
12 . What are the terms for financing available with you ? ( banks / financial instn./ private )
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QUESTIONNAIREON
SURVEY OF ENGINE SALES
NAME
ADDRESS
CONTACT PERSON
Please react to the following statements on the given scale , about the brand you are dealing in.Here,
1=strongly disagree2=moderately disagree3=neither agree nor disagree4=moderately agree5=strongly agree
1)People buy water cooled models because they are ignorant about merits of air cooled models.
(_) (_) (_) (_) (_)1 2 3 4 5
2) People ask for most advertised/publicized / visible models
(_) (_) (_) (_) (_)1 2 3 4 5
3)People buy because of price rather than anything else.
(_) (_) (_) (_) (_)1 2 3 4 5
4)Customers come with predetermined model and brand to buy.
(_) (_) (_) (_) (_)1 2 3 4 5
5)You most of the times change the decision of the customers.
(_) (_) (_) (_) (_)1 2 3 4 5
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6)You get sufficient dealership margin in sale.
(_) (_) (_) (_) (_)1 2 3 4 5
7)You get adequate incentives and non monetary benefits, like travelling opportunities, to promote the brand you are dealing in.
(_) (_) (_) (_) (_)1 2 3 4 5
8)You are brand loyal and will stick to the brand you are dealing in.
(_) (_) (_) (_) (_)1 2 3 4 5
9)You will change the brand , for higher margin , with similar sales potential.
(_) (_) (_) (_) (_)1 2 3 4 5
THANK YOU VERY MUCH FOR ANSWERING ALL THE QUESTIONS WITH
PATIENCE.
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PHASES IN GROWTH OF NO. OF DEALERS
Watch the product life cycle, but more important, watch the market life cycle –
Kotler
Based on how many years old the dealers are in this business a frequency
distribution table has been made.
Table No. 1
Years old No. of Dealers Cumulative No. of Dealers starting from the oldest
0-5 8 51
5-10 4 43
10-15 8 39
15-20 9 31
20-25 5 22
25-30 5 17
30-35 6 12
35-40 4 6
40-45 2 2
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PLOT OF NO. OF DEALERS AGAINST YEARS OLD THEY ARE
Fig. 1
Smoothened version of the above drawn curve.
Fig. 2
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PLOT OF CUMULATIVE NUMBER OF DEALERS AGAINST YEARS OLD THEY ARE
Fig. 3
Smoothened version of the above drawn curve.
Fig. 4
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Drawing the Curve for no. of dealers against years old they are, one can see there are
two phases of growth alternating each other.
One is the phase of fast growth.
And another is the phase of slow growth.
Each phase continues for 10 Years alternating each other.
One can easily see from the no. of dealers curve that the phase of fast growth has
already been round the corner for previous 2-3 years and will continue for 7-8 more
years to come when the curve will go down and a period of slow growth will take
effect.
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MARKET SHARE & RELATIVE COMPETITION IN THREE SEGMENTS OF ENGINE SALE
Poor firms ignore their competitor; average firms copy their competitors; winning firms lead their competitors.
Table No. 2
Range of engines in HP No. of Dealers %of Dealers0-14 46 90.19
15-40 31 61.78
>40 10 19.6
Fig. 5
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Table No. 3
Range of engines in HP Total Volume of sales % Share0-14 5572 74.89
15-40 1088 14.62
>40 780 10.48
=7440
Fig. 6
Hence rank order of sale of engines of each segment is
1. 0-14HP.
2. 15-40HP
3. >40HP
Now putting the just arrived figures. Under the light of percentages of dealers
dealing in each segment.
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Table No. 4
0-14 HP 15-40 HP >40 HP
% of Dealers 90% 61% 20%
Market Share 75% 15% 10%
Assuming,
The total no. of Dealers in Rajasthan = P
The volume of sales in Rajasthan = Q
The above scenario can be depicted like this.
Table No. 5
0-14 HP 15-40 HP >40 HP
No. of Dealers (90/100)P (61/100)P (20/100)P
No. of Customers (75/100)Q (15/100)Q (10/100)Q
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Since,
Competition is directly proportional to no. of dealers,
and inversely proportional to no. of Customers.
Therefore,
Competition = K X No of Dealers
No. of Customers
(K= Proportionality constant)
Hence Dealer Customer ratio in each case is
Table No. 6
0-14 HP 15-40HP >40 HP
(90/75) P/Q (61/15) P/Q (20/10) P/Q
=1.2 P/Q =4.07 P/Q =2 P/Q
=P/Q Approx. =4 P/Q Approx. =2 P/Q Approx.
Hence relative competition in the three segments is
P/Q:4 P/Q:2P/Q
=1:4:2
Therefore 15-40 HP engine Market is four times more competitive than 0-14
HP Market and it is two times more competitive than >40 HP engine Market
Hence the rule for line extension can be shown as.
0-14 HP 15-40 HP >40 HP
While it is advisable to extend in >40 HP engines area. It is twice so in 0-14 HP
engines area.
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AIR COOLED vs WATER COOLED
Table No. 7
No. of Dealers
dealing only air
cooled
No. of Dealers Dealing only water
cooled
Both Air cooled Water cooled
2 32 17 19 49
3.92% 62.75% 33.33% 37.25% 96.08%
Fig. 7
Since, 96.08% of Dealers keep water cooled sets, its immense popularity is
evident against those of the aircooled sets kept by 37.25%.
It was also found out during the survey that air cooled models are popular in
industries, and urban sector while water cooled models are popular in rural &
agricultural sector.
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AVAILABILITY OF DEALERS IN DIFFERENT PRICE
SITUATION (DEALERS PRICE PREFERENCE)
The best way to get and keep customers is to constantly figure out how to given them
more for less –
Kotler
Based on responses following table has been prepared
Table No. 8
Price Range (15-40HP) (Rs.) No. of Dealers
5000-10000 1
10000-15000 1
15000-20000 5
20000-25000 9
25000-30000 9
30000-35000 8
35000-40000 7
40000-45000 7
45000-50000 8
50000-55000 7
55000-60000 5
60000-65000 6
65000-70000 7
70000-75000 7
75000-80000 6
80000-85000 6
85000-90000 6
90000-95000 5
30
95000-100000 5
100000-105000 5
105000-110000 4
110000-115000 5
115000-120000 5
120000-125000 5
125000-130000 5
130000-135000 5
135000-140000 5
140000-145000 5
145000-150000 5
150000-155000 3
155000-160000 3
160000-165000 3
165000-170000 3
170000-175000 3
175000-180000 3
180000-185000 3
185000-190000 2
190000-195000 1
195000-200000 1
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Fig. 8
SMOOTHENED VERSION OF THE PREVIOUS GRAPH
Fig. 9
A hypothetical chart has been prepared to take note of every change in the of no. of
Dealers against rise in price.
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Table No. 9
PRICE (Rs.) AVAILABLE NO. OF DEALERS
8000-12000 113000-14000 215000 216000 217000 418000 519000 620000 521000 722000 723000 824000 725000 1026000-30000 931000 1232000 1034500 935000 936000-39000 940000 1141000-42000 1043000-45000 1046000-50000 851000-58000 759000-60000 761000-62000 763000-80000 681000-93000 594000-105000 5106000-109000 5101000-150000 5151000-185000 2185000-200000 1
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Fig. 10
Smoothened version of the previous curve
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Fig. 11
TOP DEALERS OF RAJASTHAN
From the response of different dealers of different territories in Rajasthan the
dealers of different regions has been ranked in order according to the dealers’
perception
JAIPUR
1. Jackson Traders 7
2. Industrial Sales and manufacturing 6
3. Arjun Metals 4
4. Bhaskar Power Projects 4
5. Sudhir Gen Sets 3
6. Esen Engineers 3
7. Laxmi Agencies 3
8. Capital Engineers 2
9. Atlantic 2
10. Pratap Diesels Private Ltd. 1
11. Auto Diesel Spare and Services 1
12. Supreme Engineers 1
13. Laxmi Aircon 1
14. Eicher Agencies 1
15. Allied Agencies 1
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16. Vikash Agro engineers 1
Fig. 12
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SIKAR1. Arjun Metals
2. Laxmi Agro Agencies
3. New Chaudhary Enterprises
4. Chaudhary Machinery
5. Chaudhary Auto Centre
6. Chaudhary Auto Enterprise
7. Chaudhary Trading
DAUSA1. Vijayvargia Sales Co.
2. Rajesh Agencies
3. Rajesh Automobiles
4. Khandelwal Engine Co.
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KOTA
1. Fatehpuria Bros.
2. Bombay Machinery
3. Govind Agencies
4. Maharashtra Engg. & Machinery
5. Jainsons Enterprises
6. M. M. Sales
7. Maheswari Mill Store
8. Hindustan Machinery Mart
9. Delhi Machinery
10. Sanjay Agro Agencies
11. Nimish Enterprises
12. Dasmesh Enterprises
13. Ambika Krishi Kendra
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BARAN
1. Ganesh Machinery
2. Garg Traders
3. Banshal Machinery Stores
4. Jain Traders
5. Delhi Machinery
6. Nagar Machinery
7. Soni Enterprises
8. Nakoda Industries
9. Manoj Traders
BUNDI
1. Rashmi Traders
2. Shanti Traders
3. Mahajan Mill Store
4. Jhanwar Traders
5. Sharma & Co.
6. Usha Co.
7. Sharma Agencies
8. Vijay Agencies
9. Pradeep Electronics
10. Ashoka Traders
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JODHPUR
1. Mahesh Engg. Centre
2. Bhagwanti Machinery
3. Jain Machinery Shop
4. Kisan Bros.
5. Azad Enterprises
6. Harsh Trading Co.
7. Shree Kisan Bros.
8. Generators International.
9. Kushal Traders
PALI
1. Om Machinery Stores
2. Kisan Bros.
3. Mohan Machinery
SANCHORE
1. G. M. Agencies
2. Gehlot Machinery
3. Jambheshwar Machinery
4. Barmer Machinery Stores
5. Gayatri Machinery
6. Choudhary Sales Co.
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DHORIMANNA
1. Ashapuri Traders
2. B. R. Chaudhary Machinery Stores
3. Jangid Krishi Kendra
4. Gehlot Machinery
5. Kishan Machinery Store
6. Malaxmi Machinery
7. Godara Machinery Stores
8. Gopal Diesel Engines
9. Ganpati Traders
10. Vishwakarma Machinery
11. Jagdish Selection Machine Stores
12. Sarvodaya Electricals
BARMER
1. Barmer Enterprises
2. Marudhar Enterprises
3. Barmer Machinery Parts
ALWAR
1. Khandelwal Krishi Kendra 2. Agriculture Associates
3. Laxminarain Narendra Kumar
4. Subham Agency
5. Indrajit
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COMPETITION OF BRANDS & BRAND EQUITY
No of Respondents = 51
According to the responses from these dealers of different brands, rank in order of
competitors of different brands has been worked out, based on the following
formula.
No of Points = (No. of Brands ranked+1) (No. of
respondents of the concerned brand) –
sumtotal of ranks assigned
Based on the points gathered the different brands has been ranked in descending
order
42
RANK IN ORDER OF COMPETITORS OF KIRLOSKAR
Table No. 10
RANK BRAND POINTS
1 Field Marshal 117
2 Eicher 57
3 Ashok leyland 34
4 Cummins 33
5 Vishal Bharat 24
6 Prakash 22
7 Topland 16
8 Crown 12
9 Atul 11
9 Ajit 11
9 Usha 11
12 Mercury 9
Perception of extent of competition given by other brands to Kirloskar.
Fig. 13
43
Perception of extent of competition given by other brands to Field Marshal
Table No. 11
RANK BRANDS POINTS
1 Kirloskar 82
2 Topland 61
3 Satyajit 22
4 Anil 15
5 Indrajit 8
6 Mercury 7
7 Sonnet 6
7 Progressive 6
9 Bharat 5
Perception of extent of competition given by other brands to Field Marshal.
Fig. 14
44
Perception of extent of competition given by other brands to Topland
Table No. 12
RANK BRANDS POINTS
1 Kirloskar 8
2 Field Marshal 6
3 Mercury 3
3 Prakash 3
Perception of extent of competition given by other brands to Topland.
Fig. 15
Perception of extent of competition given by other brands to Eicher
45
Table No. 13
RANK BRANDS POINTS
1 Kirloskar 10
1 Field Marshal 10
3 Topland 8
4 Anil 4
5 Sonnet 3
6 Satyajit 2
Perception of extent of competition given by other brands to Eicher
Fig. 16
Perception of extent of competition given by other brands to
Usha
Table No. 14
46
RANK BRANDS POINTS
1 Kirloskar 24
2 Field Marshal 12
3 Bharat 5
4 Topland 4
5 Prakash 3
6 Sonnet 2
Perception of extent of competition given by other brands to Usha
Fig. 17
Perception of extent of competition given by other brands to Ashok Leyland
Table No. 15
47
RANK BRANDS POINTS
1 Kirloskar 3
2 Tata 2
3 Cummins 1
Fig. 18
Perception of extent of competition given by other brands to Cummins
Table No. 16
RANK BRANDS POINTS
48
1 Kirloskar 3
2 Ashok Leyland 2
3 Tata 1
Fig. 19
Perception of extent of competition given by other brands to remaining brands
Table No. 17
RANK BRANDS POINTS
1 Kirloskar 26
2 Field Marshal 20
3 Topland 19
4 Prakash 10
4 Satyajit 10
4 S.A Tiger 10
7 Harvest 9
7 Progressive 9
9 Sonnet 8
9 Varun 8
49
Fig. 20
Measure of Brand power of each brand
Assuming each dealer rates his brand as number one in the territory the brand power of
individual brands has been calculated based on the same previous formula.
Table No. 18
Brands Points gained by own
dealers
(A)
Points given by
other dealers
(B)
Brand power
(A+B)
Kirloskar 430 156 586
Field Marshal 279 165 444
Eicher 54 57 111
Usha 78 11 89
Topland 32 108 140
Ashok leyland 9 36 45
50
Cummins 9 34 43
Others 232 186 418
Fig. 21
Brand order in Rajasthan
1. Kirloskar 2.Field Marshal 3.Topland 4.Eicher 5.Usha 6.Ashok Leyland 7. Cummins.
PERCEPTIONS, SELLING PROPOSITIONS AND BRAND
USPs
From these two questions several selling propositions and perceptions about the
different brands has been charted. They appear in the order of frequency they are
heard in the market.
KIRLOSKAR
Faith in name (Brand Power)
Powerful
Availability of service
Genuine parts
Engine is o.k.
Quality
Cheap
Requires overhauling after three years
FIELD MARSHAL
Good quality
Oldest name in the market
Good service
Free service camp in two years
Fuel economy
Availability of spares
51
Availability on credit
Reasonable price
TOPLAND
Heavy wheel
Less complaints
0% accident rate in 12 HP (Safe)
Good strengths
Availability of service
Fuel economy
Cheap
EICHER
Aircooled
Fuel economy
Maintenance free
Good quality
Engine gets derated at high temperature
52
Based on the information about different brands in question numbers 7.1 & 7.2
unique selling propositions (U.S.P.) of different brands has been worked out.
Table No. 19
NAME OF BRANDS U.S.P.
Kirloskar Brand power
Field Marshal Ready availability of service & spares.
Topland Accident free
Eicher Fuel economy
Kisan Synonym of Topland
President Synonym of Topland
Satyajit Better piston position
Annapurna Availability of spares
Ashok leyland Heavy duty
Cummins Quality
53
SELLING STRATEGIES
Based on the response from 51 dealers a frequency distribution table of different
strategies for selling has been made.
Table No. 20
SELLING STRATEGIES NO. OF DEALERS
Advertisement 25 (50%)
Field activities 16 (32%)
Credit sale 11 (22%)
Discount 8 (16%)
After sales service 4 (8%)
no effort 6 (12%)
Series 1 denotes the strategies adopted by the dealers while.
Series 2 shows dealers not adopting the corresponding strategies.
Fig. 22
54
Hence selling strategies in the order of popularity among dealers are as follows.
1. Advertisement 2.Discount and credit 3.Field activities 4.No effort
5. After sales service.
55
TERRITORIAL INFRINGEMENT
Established channels for different markets and aim for efficiency control and
adaptability.
Successful “go to market” strategies require integrating retailers, wholesalers
and logistical organizations –
Kotler
Based on the response from 51 Dealers it was learnt that infringement is
happening at a sizeable level. Few dealers claimed that 30 to 40 percent of sale is
through infringement. It was also known that few brands are prone to
infringement for example, infringement is rampant among Kirloskar dealers. Few
dealers of Topland and Field Marshal also confided that infringement is
happening in every brand including theirs but not at a noticeable level. Few
dealers also confided that company instigates infringement. Infact Kirloskar has
made “infringement” its defacto policy. A total of 13 dealers out of 51 said that
there is no check to infringement and they counterinfringed in others territory.
However there was a general feeling that infringement acts as disincentive for
field work and brand building exercises.
56
Fig. 23
Infringement is rampant in engine market because of following reasons:
Overall shrinkage in the sale of engine
Shrinkage in the sale of big brands, like Kirloskars, because of drought on the one
hand ,and tough competition on the other hand
Infringement is the indicator of shrinkage in sale, and degree of infringement is
directly proportional it.
MANAGING INFRINGEMENT
KIRLOSKAR'S STRATEGY:
(De facto policy)
Kirloskar uses infringement to its advantage by compelling dealers to cut down their
margin & being able to clear inventory at the cost of dealers
(De Jure policy).
The commission of the infringing party goes to the dealer of the territory
TOPLAND'S STRATEGY
Make as many dealers in the same territory but give brand name to only one and
change the brand name like Kisan Topland or President Topland etc.
FIELD MARSHAL'S STRATEGY
Outright cancellation of dealership of the infringing party.
INFRINGEMENT IS FACED BY THE BIG BRANDS AT THE NOTICEABLE
LEVEL BECAUSE OF LARGE NO. OF DEALERS VYING FOR CONSISTENT
MARKET SHARE IN THE PERIOD OF DECLINING OVERALL SALES
VOLUME.FURTHER IT IS ACCENTUATED BY INCREASING COMPETITION BY
57
OTHER BRANDS WHICH ARE EATING A CHUNK OF THEIR PIE BELIEING
THEIR PROJECTED SALES FIGURE.
FUTURE PERCEPTIONS
The response of dealers has been divided into three categories
(i) Good – number of dealers perceiving future of engine industry as
good.
(ii) Bleak – number of dealers perceiving future of engine industry as
bleak or dark.
(iii) Uncertain – number of dealers perceiving future of engine industry as
Uncertain or based on factors like rain supply of electricity etc.
Table No. 21
Good 19
Bleak 12
Uncertain 18
Fig. 24
Market Buzz about engines’ future
Demand for high speed engines will increase
Good rainfall will boost engine sale
58
Future of water pumps is bleak
Future of Gensets is bright
WARRANTY & SERVICE CONTRACTS
Based on response from dealers following information has been gathered
regarding warranty and service policy of the companies.
Field Marshal Policy
Field Marshal has warranty policy of 1Year, which covers:-
1. Body 2.Block 3.Head 4.Crank & 5. Wheel
However, it does not give warranty on
1. Nozzle 2. Plenzer & 3.Silencer
The company gives Rs.25/- per set for service to the dealers.
The company also arranges free service camp annually or biannually
Kirloskar Policy
Kirloskar gives 1Year warranty and has service engineerevery 14000 sets.
(Rajasthan has only one service engineer).
Eicher Policy
Eicher gives warranty for 1Year or 1000 running hours whichever is earlier.
Topland Policy
Top land gives 6 months warranty an each set.
Ashok Leyland & Cummins Policy
59
Ashok Leyland & Cummins offers 1Year warranty
(Dealers of Kota region have curtailed the warranty period to 6 months only,
for all the brands, irrespective of what is promised by the company.)
Every dealer has their own trained mechanic, and barring few exceptions all
of them bear the cost of servicing within warranty period.
Some Kirloskar dealers told that replacement is problematic and sometimes it
takes even a whole year.
Some minor brands like Swaraj, offers guarantee (Which in engine market
means replacement of whole set in case of any fault) of 1year.
60
FINANCING OF ENGINES
From the response of dealers following things has been learnt about financing
of engine. Financing of engine is available through banks. These banks
are:-
Thar Anchalik Bank.
Gramin Bank.
Co-operative Bank
Land Mortgage Bank.
To get loan from any of these banks, membership is required, which is available
on producing evidence of being native of the region where the Bank is located,
and payment of membership fees. Banks don’t give loan for engines if the
resident is in dark zone (notified by NABARD as regions where water level is
below 50 feets). For non dark Zone, loan is granted for upto 10HP engines, which
should necessarily be ISI marked. There is no list of preferred brand. Whereas
Co-operative Bank requires margin money on quoted amount, Land Mortgage
Bank does not require any margin money. Rate of interest is 11.5%.
In addition to all these Banks several other Banks grant loan as personal loan.
61
ANALYSIS OF
RESPONSE TO STATEMENTS ON
LIKERT SCALE
62
S.1 People buy water cooled models because they are ignorant about merits of
air cooled models.
No. of Respondents = 50
Table No. 22
Strongly agree (5) 13
Moderately agree (4) 7
Neither agree nor disagree (3) 6
Moderately disagree (2) 6
Strongly disagree (1) 18
Fig. 25
Mean likert rating =2.78
63
Inference:
Likert rating of 2.73 and option wise break up of the Response, both shows
general disagreement to the proposed statement.
According to dealers perception about the customer buying water cooled sets,
amidst availability of good air-cooled sets, ignorance, is not the reason behind it
rather, it was learnt there are many barriers behind it. The most prominent are:-
Psychological Barrier and Perceived technological deficiency. People feel
aircooled sets create problems in the long run, like oil spillage, over-heating,
diminishing performance etc. Further water- cooled sets do have some inherent
problems with it but people are accustomed to it and consider it as safe bet
against air-cooled ones.
But it was also found out that air-cooled sets are fairly popular among industries
and corporate for they require little care from the operators.
64
S.2. People ask for most advertised/publicized /visible models.
No. of Respondents = 50
Table No. 23
Strongly agree (5) 28
Moderately agree (4) 10
Neither agree nor disagree (3) 4
Moderately disagree (2) 1
Strongly disagree (1) 7
Fig. 26
Mean likert rating =4.02
65
Inference:
Likert rating of 4.2 and only 16% of moderate and strong disagreement against
the statement suggests overwhelming acceptance of the proposed statement.
However during the survey it was learnt that visibility creates the most powerful
impact in the engine market, rather than advertising and publicity. People have
herd mentality and prefer to buy brand and model visible in the vicinity. Rural
folks have conservative mindset and they want a ‘secure’ buy rather than
venturing with an unknown brand in the market.
66
S.3. People buy because of price rather than anything else.
No. of Respondents = 50
Table No. 24
Strongly agree (5) 3
Moderately agree (4) 13
Neither agree nor disagree (3) 5
Moderately disagree (2) 4
Strongly disagree (1) 25
Fig. 27
Mean likert rating = 2.3
Inference:
Likert rating of 2.3 and only 32% people agreeing to the statement shows,
majority of people don’t buy because of price. However, there is a niche of
people in every region who buy purely for price. There are around 6-7%
customers in a region buying purely for price while 25-26% people keep price
high on the priority of factors influencing their buying decision.
S.4. Customers come with predetermined model and brand to buy.
No. of Respondents = 50
Table No. 25
Strongly agree (5) 26
Moderately agree (4) 11
Neither agree nor disagree (3) 5
Moderately disagree (2) 3
Strongly disagree (1) 5
67
Fig. 28
Mean likert rating = 4
Inference:
Likert rating of 4 and 74% of people moderately and strongly agreeing to it,
shows that people come with predetermined brands and models to buy.
S.5. You most of the times change the decision of the customer.
No. of Respondents = 50
Table No. 26
Strongly agree (5) 14
Moderately agree (4) 26
Neither agree nor disagree (3) 4
Moderately disagree (2) 2
Strongly disagree (1) 4
68
Fig. 29
Mean likert rating = 3.88
Inference:
Likert rating of 3.88 and moderate agreement of 52% of dealers shows that they
are in partial agreement of the statement. Hence , it may be inferred that dealers
does not change the buyers’ decision most of the times but many times they do so.
69
S.6. you get sufficient margin in sale.
No. of Respondents = 50
Table No. 27
Strongly agree (5) 9
Moderately agree (4) 8
Neither agree nor disagree (3) 5
Moderately disagree (2) 10
Strongly disagree (1) 18
Fig. 30
Mean likert rating = 2.6
Inference
Likert rating of 2.6 with 56% of people clearly not agreeing to the statement,
shows widespread resentment amongst dealers, regarding the margin they get in
sales. It was also revealed during the survey that Kirloskar dealers get 4-5%
margin, Field Marshal dealers get 3-4% margin, Topland dealers get 8-9%
margin, Eicher dealers get 6-7% margin, Kisan & president dealers get 5%
margin. General expectation of dealers is that they should get 10-12 % margin in
sale, so that they could bear the cost of field activities and servicing.
70
S.7. you get adequate incentives and non monetary benefits, like 71raveling
opportunities, to promote the brand you are dealing in.
No. of Respondents = 50
Table No. 28
Strongly agree (5) 7
Moderately agree (4) 14
Neither agree nor disagree (3) 1
Moderately disagree (2) 3
71
Strongly disagree (1) 25
Fig. 31
Mean likert rating = 2.48
Inference:
Likert rating of 2.48 with 50% dealers strongly disagreeing and 56% moderately
& strongly disagreeing, while 42% strongly and moderately agreeing to the
statements, denotes, different expectation of dealers from concerned brand
owners. Whereas Kirloskar dealers get target incentive, Topland dealers get
target discount and Field Marshal distributor get gifts like, T.V., V.C.P.,
Refrigerators etc, on target fulfillment.
Many dealers get travelling opportunities, once or twice a year. However this is
not the point of contention and many felt they would be happy if such tours are
organized once in two years, so that they too may save their precious time.
72
73
S.8. You are brand loyal and will stick to the brand you are dealing in.
No. of Respondents = 50
Table No. 29
Strongly agree (5) 22
Moderately agree (4) 7
Neither agree nor disagree (3) 9
Moderately disagree (2) 3
Strongly disagree (1) 9
Mean likert rating = 3.5
Inference
Likert rating of 3.5 suggest reservations of dealers in admitting their brand
loyalty. Thus, dealers are not sure if they would stick to the brand they are
dealing in. this shows the extent of uncertainties in this segment of sale.
74
S.9. you will change the brand, for higher margin, with similar sales potential.
No. of Respondents = 50
Table No. 30
Strongly agree (5) 17
Moderately agree (4) 15
Neither agree nor disagree (3) 4
Moderately disagree (2) 3
Strongly disagree (1) 11
Fig. 32
Mean likert rating = 3.68
75
Inference
Likert rating of 3.68, with 64% of dealers moderately & strongly agreeing to it
shows impact of margin on brand loyalty among dealers. Thus, agreement to
this extent suggests that margin plays a major role in shaping brand loyalty
among dealers. dealers who moderately agree prefer to add the incumbent brand
to the list without loosing the previously existing brand.
76
Table No. 31
S.
NO.
STATEMENTS LIKERT
RATING
INFERENCE
1 People buy water- cooled Models because
they are ignorant about merits of air cooled
models.
2.78 Disagree
2. People ask for most advertised/publicized
/visible models.
4.02 Agree
3. People buy because of price rather than
anything else.
2.3 Disagree
4. Customers come with predetermined model
and brand to buy.
4 Agree
5. Customers come with predetermined model
and brand to buy.
3.88 Agree
6. You get sufficient margin in sale. 2.6 Disagree
7. You get adequate incentives and non
monetary benefits, to promote the brand you
are dealing in.
2.48 Disagree
8. You are brand loyal and will stick to the
brand you are dealing in.
3.5 Agree
9. You will change the brand, for higher
margin, with similar sales potential.
3.68 Agree
77
GAUGING THE SALES POTENTIAL OF 15-40HP
ENGINES IN RAJASTHAN
Calculated total sales of 38 dealers = 1088 sets
Since 99 dealers are listed and assuming 10% dealers remained
Unscanned.
Estimated No. of dealers = 99X(1+10%)=109
Therefore, total estimated sales = 109X1088 = 3120 sets
38
Likewise, projecting the sales figure all over the surveyed area we get the market
estimate of each region.
78
Table No. 32
NAME OF REGION ESTIMATED SALES (15-40HP)
Jaipur 487
Sikar 200
Dausa 115
Kota 372
Barmer 86
Sanchore 172
Dhorimanna 344
Pali 86
Jodhpur 258
Bundi 286
Baran 258
Alwar 143
Rank in order of market sales of regions.
Fig. 33
79
Jaipur > Kota> Dhorimanna> Bundi> Jodhpur, Baran> Sikar> Sanchore> Alwar>
Dausa> Barmer, Pali
CUSTOMER BEHAVIOUR
The most important think is to forecast where customers are moving, and to be in front of
them –
Kotler
A separate customer’ survey was done to gauge the customers’ buying behaviour. In this
survey it was found out that there is an order in which people choose a brand and model
to buy. This order can be shown as :-
Choice of dealer.
Availability of services & spares.
Quality of the set.
Price of the set.
Dealers have their area of influence and they get their customers from that area only.
Customers choose the dealer based on the performance of sets in his neighborhood or
one previously owned by him. Hence, dealers play the most important role in selling
an engine set. Some of the dealers are even known for assisting the customers in
getting loan, e.g., one Field Marshal dealers, who earlier dealt in ‘Rocket’ brand
engine, was successful in selling bulk of them because of this policy only. Several
people in Hemaguda village of Sanchore Tehsil has bought ‘Rocket’ brand because
of this only. However, customer behaviour has changed by then and few people talk
of buying on credit, even dealers don’t want to sell on credit nowadays (Kota is an
exception, where credit sale in maximum). Nonetheless, dealers still come on top of
their mind while buying an engine.
After having chosen the dealer they know, customers look for whether services and
spares are readily available or not. People are ready to buy a mediocre set which can
be repaired easily by themselves or any readily available mechanic, rather than going
80
for sophisticated ones with complex engineering and which requires expert handling
in case of fault. An anecdote from an incident may prove useful in this case. While in
Pali, I encountered a villager who told me that he consider Massey Fergusson
tractors better than Ford or Eicher, because Ford or Eicher will not work in case of
even miner fault but Massey will work even if there is a fault in its engine. Same
principle applies in the case of diesel engine sets too.
After having ascertained dealer and availability of services and spares, the customers
looks for the quality of the set. Quality of the set is Judged on following parameters.
Expected life of the set
Time period after which servicing is required
Fuel efficiency.
Nowadays people considers buying an engine as a long time investment. Hence
people don’t’ care, if they spend extra for better quality. Quality comes above price in
customers’ mind.
81
WHY DEALERS ARE SO IMPORTANT
Many businesses are wisely turning their suppliers and distributors into valued partners–
Kotler
Types of Customers Dealer’s Offer
Credit Hunter Credit
Discount Hunter Discount
Utility Hunter Extra Service & Spares
Brand Hunter Advertisement / Visibility
Information Barrier
On the left side of the above drawn diagram are the types of customers available in the
market and boxes on the right hand side shows the strategies adopted by dealers to lure
these customers. The broken vertical line shows a semi permeable barrier which can be
passed through the acquaintance with the dealer offering these customers their desired
bargain. Because, credit and discount are offered in the engine market in hidden way,
therefore, customers choose the one based on information floating in his surrounding.
That is why we find dealers commanding influence in pockets. Further, servicing of
engine is also promised by few dealers beyond warranty period. Since, much of the
pricing and servicing contract is being done in confidential manner between customer and
dealer, choice of dealer becomes of paramount importance to the customers.
82
Returning back to the diagram, if the customer is not able to pass through the semi
permeable barrier, he falls into the next lower category just below him and so on. Since,
customers try their best to remain in higher order, therefore, they cling on to the dealer
known to him rather than venturing and scanning the market.
83
EXPLOITING CUSTOMERS’ BEHAVIOUR TO BOOST
SALES POTENTIAL
Since the order of preference in buying a diesel engine set in known which reads
as
Dealer> Services & Spares> Quality> Price.
And the factor which makes 15-40HP segment most competitive (Relative
competition ratio of 3 segments is 1:4:2) is the overabundance of dealers over
customer. Both the facts suggests, brands should spread themselves all across the
dealers in the targeted territory. The brand like Kirloskar has wide presence
among dealers and hence it is better propositioned in the market. Field Marshals
strategy of distributors driven network will not work in this segment. In fact Field
Marshal is a new entrant in this segment and shall have to learn the hard fact that
it is a segment of very high competition, where competition among dealers can be
combated only by spreading the brand across the dealers.
Eicher is very vulnerable to this competition among dealers because there are very
few number of dealers of Eicher in this segment. In fact brands will find that sales
is directly proportional to the number of dealers in this segment.
A good service policy may be the next target to boost the sales. Ready availability
of spares and service centers across the targeted territory may boost sales. Infact,
anamoly is that dealers play more on advertising and credit and discount, and
services comes last in their preferred tool for sales promotion techniques. Here,
Field Marshal scores over everyone by arranging annual free services camp. Little
to wonder is has acquired an envious aura in the engine market and customers
mindset.
84
Quality of the set is of importance only when the set has passed through two
previous stages in selling process. If the sale is decided on the previous two
parameters then even an O.K. quality will do. Infact, this behaviour is due to the
fact that people buy an engine sets to get return. They want it to work in required
time period. Hence services and spares are above quality in consumers preference.
Nevertheless, there is a section of quality conscious consumer who skips the
previous two stages and go for a better quality. These are the customers from
industries and corporates. They are the people who prefer aircooled over water
cooled, less bothered about complexity of engineering and services and spares.
Among majority of customers price is the last thing they look for in an engine set.
These days pricing is no more a barrier for good quality infact there are few
customers who buy purely an price basis.
Now looking at all the parameters that customers keep in mind while purchasing
an engine set. Kirloskar is the overall winner which plays an all the four fronts
while other brands are playing upon few of them only. Hence, Kirloskars’
Marketing strategy with enormous brand power (shown earlier) is suitably poised
in 15-40HP diesel engine market.
85
MARKET SEGMENT IN 15-40HP, ENGINE SALES
15-40 HP engine market may be segmented on following basis-
1. Based on electric supply in the region:-
(a) About 12 hours of electric supply:- people buy to supplement the electric
supply from electric lines and use less of engines infact market size is meager
in this segment Sanchore, Jalore & Pali are such type of regions.
(b) About 6hours of electric supply :- people depends fully on diesel engine sets
for irrigation and other applications. Dhorimanna & Barmer are such region.
In fact these are the real market for 15-40HP engines.
2. Based on credit sale:-
(1) High credit sale:- People here prefer credit, which has given rise to a
distinet marketing environment. Kota, Baran & Bundi are such regions.
(2) Moderate credit sale:- Jaipur, Sikar and Dausa.
(3) Low credit sale Jodhpur, Alwar, Dhorimaama, Pali
Sanchore
3. Based on ease of maintenance & convenience of use:-
(i) Seeking convenient and easy to handle sets:- Urban people who prefer
aircooled over water cooled, light weight over heavy weight, portable against non
portable sets and low-noise against high noise making sets.
86
(ii) Seeking heavy duty high utility sets:- rural people, who use sets for
irrigation and related agricultural purposes, seeks water cooled and are not
bothered about weight, portability and noise level.
EICHER PERSPECTIVE
Eicher tractors manufacture engines starting from 22HP to upto 45HP, that means it is
placed in the most difficult segment of engine industry i. e, 15-40HP. Further, engine
sales in this segment is proportion to the number of dealers. with very low number of
dealers in this segment, Eicher can’t expect to boost its sale. The first most important
thing is to increase the number of dealers. Good news is that growth in number of
dealers is passing through the stage of high rate of growth which is expected to be
maintained for coming 7-8 years. The company should try to make maximum number of
dealers within this period. Further, all dealers are not alike. Average sale per dealer
calculated during survey is 29 sets per annum. The company should set a realistic target
and reward the dealers who sell above this level. The realistic target, keeping in view the
brand power of Eicher (rated as No. 4 in industry) is 25 sets. Any dealer who sells above
25 sets in an year should be given target incentive on target discount. Looking at the
rated competitors of Kirloskar (the market leader in this segment), Eicher figures at
number 2 after Field Marshal. But, Field Marshal is new in this segment and unknown in
more than 20HP segment. This elevates Eicher from, ‘Trailer’ to ‘Runner’ status, thus
allowing it to make concentrated frontal attack on Kirloskar. Weak points of Kirloskar
enumerated during survey are:-
1. Frustrated Dealers become of high level of territorial infringement and unrealistic
target.
2. Poor conformance quality
3. Short expected life of set.
4. Delayed availability of services
87
Eicher may attack on Kirloskar based on following points.
1. Treat dealers as business partners by giving them adequate incentive, realistic target
and other fringe benefits like travelling opportunities, gifts etc.
2. Maintain high level of conformance standard in its set and frame some policy to
remove consumer dissatisfaction in case some of its sets are not meeting the
required standards.
3. Frame a good servicing policy. And annual on biannual service camp, as organized
by Field Marshal, may be ideal for this purpose. Infact a time frame should be
given within which a fault must get corrected.
4. Burst the Myth of aircooled sets being problematic. It should spread awareness
among masses by ‘showing’ the effectiveness and ease of operation of aircooled
engines in mass gathering, exhibition etc, because visibility creates great impact
among masses.
5. Aircooled sets combined with fuel economy as USP and good servicing policy, it
can make a frontal attack on Kirloskar by means of comparative advertisement in
media or wall paintings or public gatherings.
88
ANNEXURE
89
CALCULATION OF MARKET ESTIMATES
Gauging the sales potential of 15-40 HP engines in Rajasthan.
Calculated total sales of 38 dealers = 1088 sets
Since 99 dealers are listed and assuming 10% dealers remained unscanned.
90
91
LIST OF DEALERS
JAIPUR
Name of
Dealership
Address Phone & Fax Contact Person
Auto Diesel Spare
& Services
M.I. Road 2378137 (o) Vijay Kumar Uppal
Esen Engineers 13, Motilal Atal
Road
368661 (o) 378911,
408833
378911 (Fax)
Ravi Malhotra
Pratap Diesels Pvt.
Ltd.
453, Sanjay Nagar,
‘D’ Kalwar Road,
Ajmer Sikar Bypass,
Jhotwara
2344351, 2346361
0141-23441551
(Fax)
P.S. Sekhawar &
D.S. Sekhawar
Jackson Traders 141 ‘B’ Ganpati
Plaza, M.I. Road
2365120, 2365159
0141-5108538
(Fax)
Manju Sharma &
Mahendra Sharma
Arjun Metals Pvt.
Ltd.
102, City Centre,
S.C.Road
2369213, 2375499
0141-2375498
(Fax)
Arjun Choudhary
Supreme Engineers Radhika Complex,
Loha Mandi, S.C.
Road
2365811,
9829053265
(Mobile)
Ramniwas
Choudhary
Sudhir Gensets Ltd. 403, shalimar
Complex, Church
Road
2371045, 5104045
0141-2371045
(Fax)
P.K. Kochhar
Eicher Agencies 7, Transport Nagar,
Agra Road
2340661 432759 Mahendra
Choudhary
92
Laxmi agencies Shiv Bhawan,
Station Road
2365691
2366990 (Fax)
Dinesh Bhati
Vikash Agro
Engineers
Vanasthali Marg 2361936 Santosh Kumar
Sharma
Capital Engineers 165-166, Ganpati
Plaza
5102333
2388658 (Fax)
Rajendra Sharma
Industrial Sales &
Manufacture Co.
Katewa Bhawan,
M.I. Road
2375371, 5108059
0141-2366329
(Fax)
Shashank Bhargava
Atlantic Agencies M.I. Road, Purohit
Ji Ka Bagh
2367465
0141-2366879
(Fax)
G.R. Nahar
Bhaskar Power
Projects (Pvt.) Ltd.
Anukampa Tower,
Church Road
0141-375165
9829058011
(Mobile)
Manish Pareek
93
SIKAR
Name of Dealership
Address Phone & Fax Contact Person
Laxmi Agro
Agencies
Kalyani Circle,
Silver Jublee Road
01572-251207 (o)
255037 (R)
Mahavir Prasad
Sharma
Arjun Metals Kalyani Circle 255548 Mukanda Ram
New Choudhary
Enterprises
Kalyani circle,
Silver Jublee Road
51475 (O) 43100
(G) 58991 ®
Bhanwar Choudhary
DAUSA
Name of
Dealership
Address Phone & Fax Contact Person
Rajesh Agencies Lalsot Road 231754 Ramesh Kumar
Gupta
Rajech Automobile Lalsot Road 230854 Brijmohan Gupta
Khandelwal Engine
Co.
Lalsot road 230290 D.P. Gupta
Vijaya Vargia Sales
Corp.
Man Ganj 230139 (O)
230406 ®
Nawal vijay
PALI
Name of Dealership
Address Phone & Fax Contact Person
Om Machinery Mandia Road 230006 Om Prakash Solanki
& Yogesh Solanki
94
KOTA
Name of Dealership
Address Phone & Fax Contact Person
Gobind Agencies Opp. Allahabad
Bank, Shopping
Centre
2450181
2450181 (Fax)
Gulab chand
Nimish Enterprises Near Payal Hotel,
Nayapura
2333808 (S)
2430468 (R)
Rajendr Tyagi
Jainsons Enterprises Nayapura, Near
Thana
2340941
2451041 (O)
2380598 ®
94141-89091
(Mobile)
S.K. Jain & Hemant
Jain
Sanjay Agro
Agencies & Delhi
Machinery
Nayapura, Near
Petrol Pump
2322823
2323824
Bhanwar Singh
Hindustan
Machinery Mart
Nayapura 2322756 Jitendra Kumar
Dhal
BARAN
Name of Dealership
Address Phone & Fax Contact Person
Manoj Traders Deendayal Park,
Sahabad Road
230957 Manoj Garg
Soni Enterprises Mangrol Road 234488 (O)
230232 ®
Jagdish Soni
Bansal Machinery
Store
Deendayal Park 230302
230267
Hemant Bansal &
Pramod Bansal
Ganesh Machinery
Store
Deendayal Park 230293 (O)
231049 ®
232001 ®
Ganesh Lal
Garg Traders Hospital road 231000
230372
Anand Garg &
Bharat Garg
95
BUNDI
Name of Dealership
Address Phone & Fax Contact Person
Rashmi Traders Lankagate Road 2442125 Bhagwan Totla
Sharma Agency Lankagate Road 2447716 Sohanlal Sharma
Sharma & Co. Lankagate Road 2443461 R.C. sharma
Jhanwar Traders Lankagate Tehsil
Road
Parmeshwar
Jhanwar
Mahajan Mill Store Lankagate road 2443145 Murli Manohar
Lakhotia &
Shelandra Lakhotia
JODHPUR
Name of Dealership
Address Phone & Fax Contact Person
Generators
International
170, Clock Tower 540085 (O)
511291 ®
Lokesh Bhandari &
Kamal Bhandari
Azad Engine Spares
Centre
Inside Sojati Gate 2615327 (O)
2622091 (O)
2430291 ®
2626542 ®
Purushottam
Lalwani
Bhagwanti
Machinery Store
Inside Sojati Gate 2639217 (O)
2611807 (O)
2513559 ®
2513559 ®
Yashwant
Bhagchandani
Mahesh Engineering
Centre
Jalori Gate 2435755
2643755
Kamal Bhawnani
Shree Kishan Bros. Opp. Kankariya
Bldg. Jalori Gate,
Choupasani Road
640244, 245
640244 (Fax)
L.N. Bhati
96
BARMER
Name of Dealership
Address Phone & Fax Contact Person
Barmer Enterprises Subhash Chowk 222826, 221744 Inder Paliwal
Barmer Machinery
Parts
Chohtan Road 20050 (P.P)
224922 (R)
Misrimal Jain &
Pawan Jain
DHORIMANNA
Name of Dealership
Address Phone & Fax Contact Person
B.R Chaudhary
Machinery Store
N.H-15 Sanchore
Road
02986-221318 Bhiyaram
Chaudhary
Gopal Diesel
Engines
Sanchore Road 221293,221603,221
046
Ramshwar Lal
Swami
Gehlot Machinery Sanchore Road 02986-221734 Ruparamji Gehlot
Ashapuri Traders Sanchore Road 221532 Khuman Singh
SANCHORE
Name of Dealership
Address Phone & Fax Contact Person
Barmer Machinery
Store
Raniwara Road,
Sanchore
222090 N.M. Jain &
Narendra Gupta
G.M. Agencies Raniwara Road 222039, 222102 M.L Parmar
Gehlot Machinery
Store
Raniwara Road 222106 (O),
223048 (R)
Ruparam Gehlot &
Mafatlal Parmar
97
ALWAR
Name of Dealership
Address Phone & Fax Contact Person
Laxmi Narain
Narandra Kumar
Station Road 2336186
0144-2337399
(Fax)
K.K. Gupta
Agriculture
Associates
1,Tej Mandi Station
Road
2337340,
5100882,
2700882
Subhash Joshi &
Rajnish Joshi
Khandelwal Krishi
Kendra
2,Tej Mandi Station
Road
2344581(O),
2345752 (R)
Deepak Khandelwal
& Neeraj
Khandelwal
98
BIBLIOGRAPHY
Marketing Management
- Philip Kotler
Marketing Research
- G.C. Beri
Statistics
- S.C. Gupta
99
“GAUGING THE SALES POTENTIAL OF DIESEL ENGINE SETS IN RAJASTHAN WITH SPECIFIC
REFERENCE TO 15-40HP ENGINES”
PROJECT REPORT
2003
Submitted in partial fulfillment of the requirement of
POST GRADUATE DIPLOMA IN MANAGEMENT(2002-2004)
Submitted by:
RAMESH KUMAR
UNDER THE GUIDANCE OF:
INTERNAL GUIDE : Mr. SRIKANT KAPOOR
EXTERNAL GUIDE: Mr. RAMESH KINI
INSTITUTE OF MANAGEMENT EDUCATIONSAHIBABAD
100
CONTENTS
S.No. Particulars Page No.
1. Certificate 1
2. Acknowledgement 2
3. Synopsis 3
4. Introduction 4
5. Company Profile 5-15
6. Research Methodology 16
7. Sample Questionnaire 17-21
8. Phases in Growth of No. of Dealers 22-25
9. Market Share & Relative Competition in three segments
of Engine sale 26-29
10. Air Cooled Vs. Water Cooled 30
11. Availability of Dealers in different price situations 31-35
12. Top Dealers of Rajasthan 36-42
13. Competition of Brands & Brand Equity 43-52
14. Perceptions, Selling propositions & Brand USPs 53-55
15. Selling Strategies 56-57
16. Territorial Infringement 58-59
17. Future Perceptions 60
18. Warranty & Service Contracts 61-62
19. Financing of Engines 63
101
20. Analysis of Statements on Likert Scale 64-80
21. Gauging the Sales potential of 15-40HP engines in
Rajasthan 81-82
22. Customer Behaviour 83-84
23. Why Dealers are so important 85-86
24. Exploiting Customer’s behaviour to Boost sales
potential 87-88
25. Market Segment in 15-40HP Engines sales 89
26. Eicher Perspectives 90-91
27. Annexure 92-101
Calculation of Market Estimate 93-94
List of Dealers visited 95-101
28. Bibliography 102
102
INDEX OF TABLES
Table No. Description Page No.
1. Years old – Number of Dealers 22
2. Range – Number of Dealers 26
3. Range, Volume, % Share 27
4. Range, Market Share 28
5. Number of Dealers, Number of Customers,
Range of Engines 28
6. Competition in three segments 29
7. Air Cooled, Water Cooled 30
8. Price – Number of Dealers 31
9. Price – Available Number of Dealers 34
10. Competitors of Kirloskar 44
11. Competitors of Field Marshal 45
12. Competitors of Topland 46
13. Competitors of Eicher 47
14. Competitors of Usha 48
15. Competitors of Ashok Leyland 49
16. Competitors of Cummins 50
17. Competitors of Remaining Brands 51
18. Brand Power of Different Brands 52
103
19. Brand USPs 55
20. Selling Strategies 56
21. Future Perceptions 60
22. Response of Statement 1 65
23. Response of Statement 2 67
24. Response of Statement 3 69
25. Response of Statement 4 70
26. Response of Statement 5 71
27. Response of Statement 6 73
28. Response of Statement 7 75
29. Response of Statement 8 77
30. Response of Statement 9 78
31. Inference of Likert Rating 80
32. Estimated Sales (15-40 HP) 82
104
INDEX OF FIGURES
Figure No. Description Page No.
1. Dealers – Years old they are 23
2. Smoothened version of dealers – years
old they are 23
3. Cumulative Number of Dealers against
years old they are 24
4. Smoothened version of previous curve 24
5. Range of Engines – Number of Dealers 26
6. Range of Engines – Sales % 27
7. Air Cooled, Water Cooled 30
8. Price – Availability of Dealers 33
9. Smoothened version of
Price – Availability of Dealers 33
10. Price – Available Number of Dealers 35
11. Smoothened version of previous curve 35
12. Top Dealers of Jaipur 37
13. Competition given to Kirloskar 44
14. Competition given to Field Marshal 45
15. Competition given to Topland 46
16. Competition given to Eicher 47
17. Competition given to Usha 48
105
18. Competition given to Ashok Leyland 49
19. Competition given to Cummins 50
20. Competition given to Other Brands 51
21. Brand Power of different brands 52
22. Selling Strategies 56
23. Extent of Infringement 58
24. Future Perceptions 60
25. Response of Statement-1 65
26. Response of Statement-2 67
27. Response of Statement-3 69
28. Response of Statement-4 70
29. Response of Statement-5 71
30. Response of Statement-6 73
31. Response of Statement-7 75
Response of Statement-8 77
32. Response of Statement-9 78
33. Market Share of different Regions in 15-40HP
Engine Sales 82
106
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