COMPARATIVE

STUDY

OF

DISTRIBUTION

CHANNELS OF HOME APPLIANCE MARKET IN AHMEDABAD

Guided

by: Dr. Jasmin Padiya Prof. Harshit Shah by: Zil Shah (117350592062) Ravi Shah (117350592016)
Presented

KEY INDUSTRY DYNAMICS

Industry

Size: US$ 7.3 billion (in FY11 according to CCI) Key Categories: White Goods, Brown goods and Consumer electronics. Competitive landscape: Dominated by Korean majors like LG and Samsung in most of the segments Margin Profile: Low margin, dependant on volumes. CAGR: 12.8% (During FY03 to FY11 according to CCI)

MAJOR PLAYERS
LG Samsung Panasonic Sony Videocon Whirlpool Sharp Godrej

FACTORS INFLUENCING INDUSTRY

Growth

in per-capita income Shift in culture Access to Credit Government investment in rural market Growth of services industry Innovative products at penetration price points

RESEARCH METHODOLOGY
Research Problem
Comparative study of distribution channels of home appliance market in Ahmedabad.

Type of Research
Descriptive Research.

Objectives

To study the distribution channels of home appliances market. To know the availability of the product in the market. To understand how the distribution channels serve the retailers and the consumers. To study the satisfaction of consumers and channel members regarding distribution channels.

Sample Size
300 Consumers & 50 Channel Members

Sample Unit
Consumers, Dealers, Retailers, Wholesalers of Consumer Durable

Source of Data
Primary as well as Secondary data collection methods

Sampling Procedure
Convenience sampling

Method of Data Collection

One to one interaction with consumers and channel partners of consumer durables with the help of questionnaires.

SWOT ANALYSIS
Strength

Weakness

Established distribution networks in both urban and rural areas

Seasonal demand
Demand is dependent on good monsoons Poor government spending on infrastructure Low purchasing power of consumers

Presence of well-known brands

Organised sector has increased its share in the market.

Opportunity

Threat

Rising growth rate of GDP Rising purchasing power of people Rapid Urbanization Penetration level of white goods is lower than in other developing countries Unexploited rural market

Higher import duties on raw materials Cheap imports from Singapore, China and other Asian countries Poor infrastructure

KEY SUCCESS FACTOR

Market Positioning and Branding Product Technology Innovation in Advertising and Promotions Distribution and Service Network Attractive Locations

FIVE FORCE ANALYSIS

Suppliers Power High Raw Material Prices Lack of Captive Source Hurting Steel Producers Lack of Transportation Backward Integration

Asarwa:
3500 3000 2500 2000 1500 1000 500 0 Krishna Swastik Mill Sarvoday Enterprise Store Steel Co. 1 2 3 Ronak Co. 4 Kaushik Steel 5 Kishore Steel 6 HR (in tons) CR (in tons) GP (in tons)

Rakhiyal:
1600 1400 1200 1000 800 600 400 200 0 Rushabh Steel Co. Paxaal Metal and Nickle Alloys kanakratna Steel Krishna Metal R.I. Steel Arsh Traders Rajeshwar Steel Lalit Steel

HR (in tons) CR (in tons) GP (in tons)

KEY CHART OF BQ & HT STEEL ANALYSIS:

Manufacturers' High Importance Towards Key Buying Factors

80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% Quality of Material Price Payment Terms Availability of Material Prompt Delivery 46.66% Percentage of Total Manufacturers 76.66% 70% 66.66% 60%

KEY FINDINGS:
Retail Study:

1. 2. 3. 4. 5.

After doing area wise comparison of retailers with respect to their Total Sales Turnover (in tonnes) we found retailers whose turnover is above satisfactory level of our objectives. They are named below: Jagdish Steel Traders Dariyapur Dhara Co. CTM Ganesh Steel Traders Dudheshwar Kishore Steel Asarwa Arsh Traders Rakhiyal

From this study we found that Essar has stack of around 50% in retail market of HR, CR & GP. Next competitor are Indian Steel and JSW steel with the stack of around 29% and 12% respectively.

BQ & HT Steel Market Study:

In boiler industry mainly HR & BQ steel are consumed. CR steel is rarely used.

Average consumption of BQ steel is around 105 tonnes per year per company.
Mainly chemical, pharmaceutical and textile industries are catered by manufacturers. A 515 and A 516 are the specification for a range of steels used in the fabrication of industrial boiler. But specially A 516 grade 70 steel plates is very popular due to their high tensile and yield strength. Quality and Price of steel are the main buying factors.

SUGGESTIONS/ RECOMMENDATIONS
Retail Study:

Our main study is to find out retailers which can be future company retail outlet. And we suggest these five retailers in five different areas who can be established as a Essar Retail Outlet. 1. Jagdish Steel Traders Dariyapur 2. Dhara Co. CTM 3. Ganesh Steel Traders Dudheshwar 4. Kishore Steel Asarwa 5. Arsh Traders Rakhiyal

BQ & HT Steel Market Study: There is a good market for BQ steel in Ahmedabad for Essar Steel to look upon. According to the specification and requirement of Chemical & Pharmaceutical industry, production of BQ steel should be done. A 516 specification of steel and specially grade 70 of it, should be produced and marketed more. In production and marketing, Quality and Price of BQ steel should be main factors.

CONCLUSION
ESSAR

has a strong retail chain which can be further brighten/expand if they establish the retail points in near future to make their place on more height in compare to others.

As

the Boiler Quality plate consumption is very much in use as per current scenario they can grow up with this section too if they concentrate on BQ and HT production more in compare to past.

THANK YOU