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8/6/2019 Tribhuwan Sir
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RECOMMENDATIONS
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LIST OF RETAILERS VISITED
1) Lindsay trading, new market
2) E. M. Esmail, Grant street
3) The seller, gariahat
4) Mangalam, minto park
5) Poddars
6) Status, theatre road
7) Saharsh, Park street
8) Perfection, Park street
9) Showman, park street
10) Reha fashion, M.G. road
11) Decorum, grant street
12) Akberally, bentick streer
13) J. S. mohemadally, bentick street
14) Hasnain, bentick street
15) Dress circle, grant street
16) A G Hatim bhai, grant street
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17) Siddharth, bentick street
18) Omco, bentick street
19) Pariwar, burrabazar
20) Chitrakoot, burrabazar
Distribution channel: Since most of the retailers are not satisfied with the distribution
channel of the organization, the organization needs to ponder over this issue. This issue
cannot be ignored because poor distribution channel will lead to poor stock in the retail stores
which will finally lead to reduced sales volume. The reason for this poor distribution
channel might be the presence of only one whole seller in the city. If we want to cater to
all and broaden our horizons, increasing the number of whole sellers might resolve this
issue. A single whole seller has to take care of a lot of issues and he faces many problems
while supplying to a new client in an area where he already has a client. It will be fruitful if
we have another whole seller who can cater to those retailers where the existing whole seller
cannot reach. Appointing additional whole sellers will undoubtedly improve the distribution
channel across the city.
SUPPLY AND ORDER DELIVERY: A poor distribution will definitely lead to a
poor supply chain management. Ifthe issue of distribution channel be resolved, the
supply of socks will definitely be good because distribution channel and supply go hand in
hand.
ADVERTISEMENT INITIATIVES: advertisement initiatives are quite inevitable
for a good brand recall among the end consumers. In a city where the demand of linen fabric
is limited only to high end consumers, the advertisement initiatives will have a greater role to
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play in order to make them aware of the brand. It is high time now that the organization
starts advertisement campaigns. Bill boards in the market, TV advertisement, magazines and
newspapers, online medium should be explored. Reaching out the masses through viral
marketing like Facebook, LinkedIn and other social networking websites can prove to be
quite fruitful. The organization doesnt have monopoly with the linen fabric anymore. The
competitors have started to creep in the market and so, the consumers have choices available
in the same product category. The need of the hour is to adopt proper advertisement
initiatives. The concerned department can also meet with the retailers and the whole seller to
discuss about this issue and do the needful. We should provide the retailers with carry bags,
key rings and some gifts during festive seasons. This will be given to the customers who
purchase linen fabric. This will surely be a good strategy for improving the visual branding
for our product.
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PRICE STRUCTURE:
After interacting with the city retailers, it was found that all of them feel that the product is
highly priced and this acts as a repellent for the consumers. The high price structure was not
a problem when the company used to enjoy a monopoly in the market. But, with the advent
of competitors, this price structure is driving the consumers towards other brands. It is
recommended that the organization revise its price structure. A consumer in a city like
Kolkata will not buy a product if he/she is getting the same product for a lesser amount.
This is because brand loyalty is not found among most of the city dwellers. What the
organization needs to do is revise the price structure so as to retain the consumers.
India is a land of festivals and we should capitalise on this fact. During the festive
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seasons, the organization can launch a slightly inferior quality fabric line for a reduced
price. Of course, the quality should not be reduced to a considerable level. For example
if a brand called anna is there in the market which is priced at 100, we can launch a new
brand manna for the same product line. This product will be slightly inferior and the price
will be kept low. This will surely attract the fantasy of consumers in a city like Kolkata. And
if this strategy is implemented for a product like linen fabric, the consumers will surely want
to have the luxury of donning a garment made of linen.
EBOs OF LINEN CLUB FABRIC IN THE CITY: Some of the retailers were
interested in opening up exclusive business outlets but the company policy is not very
encouraging for them. Their demands for an EBO are:
They need a space that should be provided by the organization
All the initial investment should be lent by the organization.
This will be like a loan that they will repay to the organization gradually.
Now, all these demands are not possible to fulfil. What we can do is to negotiate and decide
on a middle path. Even if we are providing space and initial investment, we wont provide all
of it. We can share the investment with them and recover that amount gradually.
If we want to integrate the recommendation section, the following graph will
say it all:
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THE NEW
ENTRANTS
INTRODUCTION: The new entrant in the linen fabric market that has recently hi Kolkata
is La fair, by Nirvana silk mills, a Mumbai based company. They recently launched high
value La-Fair linen shirting fabric during Dealers Conference held at Fariyas Hotel
Lonavala. The company claims La-Fair to be 100% linen shirting in width of 58 with higher
lea count. La fair claims to have produced 300 designs so far and promises to launch 100
designs per month.
Mr. Kapal Mehta, Director of Nirvan Silk Mills stated that the company has state of the art
weaving unit at Tarapur with 138 Rapier & Sulzer Projectile looms. It produces 10 lac meters
of shirting per month. Recently, the company has undertaken an expansion of Rs. 18 crore so
that its capacity will be increased to 14 lac meters within 6 months time.
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The company has plans to introduce 100% linen suiting & cotton -linen shirting in the near
future. In addition, the company has plans to set up yarn dyeing, sizing & processing units at
the cost of Rs. 50 crore. The company has 4 acres of additional plot in Tarapur, which will
take care of future expansion.
Nirvan Silk Mills has Pan India presence. The company, at present, is directly exporting
fabrics to Saudi Arabia, Dubai, Thailand, Malaysia, Indonesia, Vietnam, Cambodia etc. The
present export of the company is around Rs. 10 crore, which will enhance to Rs. 20 crore next
year.
Comparison with La Fair
Jaya Shree textiles had no threat from any other organization or competitor earlier. From the
day of its inception in 1949, the linen fabric had been enjoying a monopoly in the market.
There were no competitors both in the domestic as well as international market. Exports are
made even today, but with the advent of La fair both in the domestic and international
market, a threat has crept up for us. Even in the market of eastern India (primarily Kolkata).
La fair is not a giant yet, but it is catching up fast. They claim to have 15% of the Linen
market in India, but the point that is noteworthy is that if that is true, they have been able to
do it in a very short span of time. With some smart strategies, they have been able to create a
name for their brand. They have recently hit the Kolkata market too and they are the only
competitor that we have to worry about.
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PRICE STRUCTURE: The pricing strategy of La fair is giving it an advantage over us,
especially in a city like Kolkata, where people hate to cross their budget. As already
mentioned, Kolkatans will go for a product that is low priced compared to a same product
that is highly priced. It seems that they are capitalising on this attribute of the city dwellers.
They have launched their linen fabric at a price lower than our product. Even the retailers in
the city are aware of this fact and understand this strategy of our competitor. Even they can
avail their fabric for a lower price as compared to our fabric. As a result, they have enhanced
profit margins.
MARKET SHARE: La fair does not stand up to us when it comes to current market share,
but they are undoubtedly catching up fast. They claim to have a market share of 15% at
present.
A comparison of stocks at 5 random retail stores
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