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PREFACE
This Project has been prepared as per the requirement of my
B.Com curriculum. This will also give the proper knowledge of
‘Alternative distribution channels in paint industry.’
I have worked my best to keep the presentation of this Project
report simple and understandable. My aim is to make clear all
related points of the study.
While presenting the project report I am very optimistic about
its relevance to the organization.
Acknowledgement
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It gives me immense pleasure while thanking the Management of Berger Paints India Ltd. for allowing me to do my Project Training in this organization.
I am very much grateful to Mr.Bhaskar Dasgupta(Regional Manager) Sales who gave me this opportunity to work under his guidance and provided valuable suggestions
I would also like to thank Mr. Mainak Ghosh ( sales manager), who provided all the information and untiring guidance throughout the project.
I would like to acknowledge the efforts of Mr. Manosij Mukherjee in helping me compile this project. Without his support, this project would not have been complete.
I would also like to express my sincere gratitude to my college guide Professor Tridib Sengupata for his valuable inputs and assistance throughout.
I wish to take the opportunity to extend my sincere gratitude to all those who have given me their precious time and humble guidance in the completion of my Project report. During the preparation I have also received full co-operation of the Sales Department.
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Part One
INTRODUCTION
History of Paint Industry in India
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The Indian paint industry is a Rs 49 billion sector. The demand for paints is relatively price-elastic but is linked to the industrial and economical growth. The per capita consumption of paints in India is very low at 0.5 kg per annum if compared with 4 kgs in the South East Asian nations and 22 kgs in developed countries. The global average per capita consumption is 15 kg. In India the organised sector controls 70 percent of the total market with the remaining 30 percent being in the hands of nearly 2000 small-scale units.
In India the industrial paint segment accounts for 30 percent of the paint market while the decorative paint segment accounts for 70 per cent of paints sold in India. In most developed countries, the ratio of decorative paints vis-a-vis industrial paints is around 50:50. All the industry majors have a vast dealership network and are required to maintain high inventory levels. most of the paint leaders have technical tie-ups with global paint leaders. Sector comments Paint is a mixture of four elements - solvents, binders, pigments and additives. Solvents give the paint a liquid flow while the binder binds it to the surface. Pigments impart colour and opacity to the paint and the additives give it special resistance properties. The recession in the construction and automobile sector had thrown in shades of grey across the Industry spectrum, but the revival in these sectors is cause for cheer for the paint industry as well. The balance sheets of the industry majors are now painted with bright colours. Sector specifics on product lines, paints can be differentiated into decorative or architectural paints and industrial paints. While the former caters to the housing sector, the automotive segment is a major consumer of the latter. Decorative paints can further be classified into premium, medium and distemper segments.
Premium decorative paints are acrylic emulsions used mostly in the metros. The medium range consists of enamels, popular in smaller cities and towns. Distempers are economy products
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demanded in the suburban and rural markets. Nearly 20 per cent of all decorative paints sold in India are distempers and it is here that the unorganised sector has dominance. Industrial paints include powder coatings, high performance coating and automotive and marine paints. But two-thirds of the industrial paints produced in the country are automotive paints. Market profile The leaders in the organised paint industry are Asian Paints (India) Ltd. (APIL), Kansai Nerolac, Berger Paints, Jenson & Nicholson Ltd. (J&N) and ICI (India) Ltd. Asian paints is the industry leader with an overall market share of 33 per cent in the organised paint market. It has the largest distribution network among the players and its aggressive marketing has earned it strong brand equity. The Berger Group and ICI share the second slot in the industry with market shares of 17 per cent each. Kansai has a market share of 15 percent in the organised sector. The market can be further split into decorative paints and industrial paints.
The demand for decorative paints is highly price-sensitive and also cyclical. Monsoon is a slack season while the peak business period is Diwali festival time, when most people repaint their houses. The industrial paints segment, on the other hand, is a high volume-low margin business. In the decorative segment, it is the distribution network that counts while in the industrial segment the deciding factor are technological superiority and tie-up with automobile manufacturers for assured business. APIL dominates the decorative segment with a 38 per cent market share. The company has more than 15,000 retail outlets and its brands Tractor, Apcolite, Utsav, Apex and Ace are entrenched in the market. Kansai( formerly Goodlass Nerolac Paints Limited), the number-two in the decorative segment, with a 14 per cent market share too, has now increased its distribution network to 10,700 outlets to compete with APIL effectively. Berger and ICI have 9 per cent and 8 per cent shares respectively in this segment followed by J&N and Shalimar with 1 and 6 per cent shares. The share of industrial paints in the total paint consumption of the nation is very low compared to
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global standards. It accounts for 30 per cent of the paint market with 70 per cent of paints sold in India for decorative purposes.
In most developed countries, the ratio of decorative paints vis-a -vis industrial paints is around 50:50. But, with the decorative segment bottoming out, companies are increasingly focusing on industrial paints. The future for industrial paints is bright. In the next few years, its share would go up to 50 per cent, in line with the global trend. GNPL dominates the industrial paints segment with 41 per cent market share. It has a lion's share of 70 per cent in the OEM passenger car segment, 40 per cent share of two wheeler OEM market and 20 per cent of commercial vehicle OEM market. It supplies 70 per cent of the paint requirement of Maruti, India's largest passenger car manufacturer, besides supplying to other customers like Telco, Toyota, Hindustan Motors, Hero Honda, TVS-Suzuki, Mahindra & Mahindra, Ashok Leyland, Ford India, PAL Peugeot and Bajaj Auto. GNPL also controls 20 per cent of the consumer durables segment with clients like Whirlpool and Godrej GE. The company is also venturing into new areas like painting of plastic, coil coatings and cans. APIL, the leader in decorative paints, ranks a poor second after Goodlass Nerolac in the industrial segment with a 15 per cent market share. But with its joint venture Asian-PPG Industries, the company is aggressively targeting the automobile sector. It has now emerged as a 100 per cent OEM supplier to Daewoo, Hyundai, Ford and General Motors and is all set to ride on the automobile boom. Berger and ICI are the other players in the sector with 10 per cent and 9 per cent shares respectively. Shalimar too, has an 8 per cent share.
Price sensitivity factors various factors that have influenced the pricing of paints are summarised below: The industry is raw-material intensive. Of the 300 odd raw materials, nearly half of them are imported petroleum products. Thus, any deficit in global oil reserves affects the bottom-line of the players. The major raw materials titanium dioxide, phthalic anhydride and peutarithrithol
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constitute 50 per cent of the total cost. Besides, this, there are other raw materials such as castor, linseed and soybean oils, turpentine. The raw materials cost sums up to a whopping 70 per cent. Any increase in the prices of these raw materials could adversely affect paint prices. Most of the paint majors have to import nearly 30 per cent of their raw material requirements thus changes in import policies can affect the industry. The prices of packing materials such as HDPE, BOPP and tinplate have reduced considerably. However, the decision of the Central Government to ban import of tinplate waste could lead to a spurt in the prices of the tinplate in the near future. Technology collaboration All the paint majors have tie-ups with global paint leaders for technical know-how. Asian Paints has formed a JV with PPG Industries Inc to service the automotive OEMs. Berger has a series of tie-ups for various purposes. It has a technical tie-up with Herbets Gmbh of Germany in addition to its joint venture with Becker Industrifag. With the agreement with Herbets coming to an end in 2001, Berger has now allied with the Japanese major Nippon Paints to boost its OEM turnover since the Indian roads are being flooded with Japanese automobiles. It also has an agreement with Orica Australia Pvt. Ltd. to produce new generation protective coatings. The company also has tie-ups with Valspar Corp and Teodur BV for manufacturing heavy duty and powder coatings.
The industrial paints are slated to grow at an annual rate of 10 to 12 per cent per annum for the next few years. The industrial paint manufacturers would benefit from the burst in the passenger car sales. The two-wheeler industry has also registered a good show in the current year. The commercial vehicles segment, a star performer last year with 33 per cent growth, is expected to average a growth of only 15 per cent this year. However, the raising titanium dioxide prices and the negligible growth in agriculture this year, will play spoilsport. Considering the past trend, the paint industry is expected to show at least twice the growth of Indian GDP in the ensuing years. The reduction of excise duties from a
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high of 40 per cent to 16 per cent in the last five years has made the numerous small-scale units unviable, as they no longer have a price advantage over the organised sector. This has helped the organised paint industry a lot. The industry is in a consolidation phase and only those Indian paint companies with a strong technical alliance, better distribution network and an ability to compete in the global markets would emerge victorious in the paint war.
Company Profile:BERGER PAINTS
Berger Paints has come a long way since its inception in the year 1923. India’s second largest decorative paint player, Berger Paints is headquartered in Calcutta and services the market through a distribution network comprising of 82 stock points and 12,000+ paint retailers. One can trace the history of Berger Paints to the 18th century. In 1770, Louis Steinberger moved from Frankfurt to London to sell a ‘Prussian blue’ colour, which was made using his own formula. He then changed his name to Lewis Berger and by 1870 Berger was selling 19 different pigments, including black lead, sulphur, sealing wax and mustard. After the demise of Lewis Berger his sons took over the business. Sherwin-Williams, an American company bought control of the company in the 1900s.
IN THE 1940’S
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By the 1940s Mr. Hadfield had set up Hayfield’s (India) Ltd a small paint company in Calcutta on 17 December,1923. Towards the end of 1947 British Paints acquired Hadfield's (India) Ltd and thus British Paints (India) Ltd was incorporated in the State of West Bengal.
FROM 1950-1970
In 1951, sales offices were opened in Delhi and Mumbai and a depot was started in Guwahati. This resulted in sales rising to Rs.6 million in 1952. In 1969 Berger, Jenson Nicholson Limited, UK bought the British Paints (India) Ltd. This marked the beginning of Lewis Berger’s legacy in India - which the company would later take forward to enviable heights. Mr. D. Madhukar took over as the Managing Director in the year 1973. Under him the company became the fastest growing company in the paint industry as sales figures reached over Rs. 160 million by 1978.
FROM 1980-1999
The 80s and the 90s saw the launch of many new products such as emulsions and distempers. The COLOR BANK tinting system was launched through which the consumer can select from a range of over 5000 colours. Mr. Amar Bose has been the Managing Director since 2007, under whom Berger's team currently runs.
Apart from operations in Russia, with a production facility at the Berger manufacturing unit at Krasnodar, Berger has also expanded its footprint in Nepal by setting up a second unit. Today Berger’s sister company in Bangladesh is the dominant leader with over 65% market share. In keeping with the Company’s dynamic growth plan, Berger has also acquired Bolix SA of Poland, a leading provider of External Insulation Finishing Systems (EIFS)
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in Eastern Europe. As Berger continues to grow internationally it also continues to be the second largest paint company in India.
Berger is the lone supplier to Nuclear Power Plants with its protective coatings. The automotive sector, be it cars or bikes, is primarily ruled by Berger’s automotive coatings. Luxury cars including Mercedes make use of Berger’s products. Companies like Nokia use Berger’s services as well. Berger has tied up with Becker of Sweden to manufacture coil coatings for steel surfaces.
IN THE NEW MILLENNIUM
Jenson & Nicholson, Nepal was acquired as a 100% subsidiary and renamed Berger Jenson & Nicholson, Nepal. The Motors & Industrial paints business of ICI India with its factory at Rishra, West Bengal was acquired as a 100% subsidiary Berger Auto &
Industrial Coatings Limited and then merged with the Company in 2005. Another new paints factory at Jammu was commissioned in 2003-04 and in 2005 the Company ventured into Russia through a foreign subsidiary. New technical tie-ups were forged. Currently the Company has Technical License Agreements with
→ DuPont Performance Coatings in the area of automotive coatings,→ Nippon Paint Co Ltd for new generation of automotive coatings, → Orica Australia Pty. Ltd. In the area of protective coatings, → TIGERWERK Lack-u. Farbenfabrik GmbH & Co. KG, Austria for specialised powder coatings and → Nippon Bee Chemical Co. Ltd for coating on plastic auto parts and mobile phones.
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Lewis Berger Home Painting was launched, offering painting solution to customers - making it a hassle free exercise. Illusions multi chrome finishes was also introduced as "designer finishes for walls" allowing consumers to transform their walls into fashion statements. This is once again a first for the Indian paint industry!
To avail the services all a customer has to do is call on Berger's helpline 1901 - 3333 - 55 and enjoy customized service in the comfort of his home.
The name Berger was prefixed with the first name of Mr Lewis Berger and a premium range of products was launched under his full name. The The new trademark includes LEWIS BERGER and incorporates a unique design and colour scheme, reaffirming the Company's commitment towards aesthetics, product quality, packaging and better service to dealers and customers.
The Company's sales in the year ended 31 March 2005 was Rs 9.83 billion.
History of Sanitary-ware Industries in India
India is a large, highly populated country of around one billion people, with an economy, which is steadily growing. As per the study, there were an estimated 125 million dwellings in India (1995), but 200 million households. This reveals an acute housing shortage. The U.N. predicts an increase in the population of 1.6% per annum. There is a gradual migrant shift from rural to urban areas and 27% of the population now lives in urban areas as compared to 20% in 1971. There is a large difference in amenities between the urban population and the rural. In 1994, 70% of the
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urban population had access to adequate sanitation, whereas in the rural community only 14% had access.
In 1991, approximately 64% of urban households had some kind of toilet facility compared with 9% of the rural areas. There is a widening difference in income between different regions, the rich and the poor.
Sanitation is a must for every individual of our society. According to the Government estimates, more than 50% of the urban population does not access to sanitation facilities. Condition of the rural areas abysmal that only 6% of the population are covered by sanitation.
Population Covered by Sanitation Facilities
1985 1990 1997Rural 0.7 2.4 6.4Urban 28.4 45.9 49.3Sanitary-ware demand:
Sanitary-ware Industries in India for the last 6-7 years have shown very dramatic growth with major players doubling their production capacity. The Companies have also upgraded their manufacturing system by introducing Battery Casting, Beam Casting and have gone in for latest imported Fast Firing Cycle Kiln Technology. These Companies have also upgraded their quality and have introduced high value range in the market, which has been accepted and appreciated. The demand for high value Sanitary-ware in India is growing very fast. The Companies are trying to meet the demand as the realization per Metric Ton for high value product is very good which ultimately results in good profitability. In order to educate the customers in India to go for quality products and also for higher value sanitary-wares, companies have adopted a very aggressive advertisement campaign. Companies have also strengthened their dealer network by offering showroom
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incentives and some of the companies have also gone for their own retail outlets in major towns. The demand for Sanitary-wares in India is growing @ 15% -17% every year.
The sanitary-ware industry in India is divided in two sectors. The organized sector consisting of 5 companies (M/s. Hindustan Sanitary Industries Limited, M/s. E.I.D. Parry, M/s. Swastik Sanitarywares Limited, M/s. Madhusudan Ceramics, M/s. Neycer India Limited), manufacturing sanitary-ware for the last 15-20 years and have established their Brand image. The organized sectors produce fully vitrified sanitary-wares, using latest technology and best of Ceramic Raw Materials available in India. The unorganized sectors have adopted local Indian technology to manufacture the basic sanitary-ware products. Since the availability of raw material is in abundance and also very cheap in the state of Gujarat & Rajasthan, various companies have established their factory in these areas. They are producing the basic sanitary-ware in various brands. Unorganized sector's percentage of production capacity and also their sales in the local domestic market are higher than that of the organized sectors' sales. Unorganized sanitary-ware manufacturer comes under small sectors and hence enjoy the benefit of Nil Excise Duty and Sales Tax and hence they sell their products in the domestic market approximately 70% cheaper than the organized sector products.
Government of India Policy on Housing Sector is very encouraging. The Government has announced Income Tax rebate on housing loan to boost the housing sector. All financial institutions are lending money for construction of house at a very low rate of interest. Government figure shows that Housing Sector is growing by approximately 25% every year. The need of Housing in India with 100 crores population looks to be very potential. As per DGTD Survey Report there is a shortage of about 20 million houses in the country by the end of 8th Five Year Plan. The housing has become a basic necessity, as people in India are
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looking forward for improved sanitary condition. The concept of making toilet is fast growing even in village areas, where toilet till last two years did not exist.
The cost of producing sanitary-ware in India is substantially low as compared to the advance countries, because the labour cost and the basic raw materials for manufacturing quality sanitary-wares is available at very cheap rate and in abundance. Because of our low cost of production, Indian sanitary-wares are very competitive in the neighboring countries and hence export from India is also growing everyday.
Demand Estimates:
The total demand for sanitary-ware in India for the organized manufacturers is at present approximately 80,000 M.T. per annum. The region wise demand pattern can be estimated as follows:
NORTH SOUTH EAST WEST TOTAL18,000 32,000 15,000 15,000 80,000
Current Market Size:
The Indian Sanitary-ware market is worth around 500 crores for the year 2001-02 with an annual market size of around 8 million pieces. This represents a yearly growth rate of about 3-4%.
Major players:
Until the mid 1940s the only Sanitary-ware available in India was imported mainly from UK and was used only in upper class residences in major cities. The first Sanitary-ware manufactured in India was by M/s. Parasuram Pottery Works. In the 1960s, companies like EID Parry, in collaboration with Royal Doulton of
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UK and Hindustan Sanitary-ware in collaboration with Twyford of UK, started production of Vitreous China Sanitaryware. Other major players who joined the organized sector were Madhusudan Ceramics and Neyveli Ceramics. In the 1980s, 7-8 other players had entered the organized sector, but most of them have since been taken over by the majors.
The large foreign players like American Standard, Toto, Villeroy and Boch have also set up distribution channels in India.
In addition to the branded products made by the above companies, there are a large number of small-scale units mainly in Thangad and Morbi districts of Gujarat.
Concerns:
It has been observed that many sanitary-ware manufacturers in the small-scale sector do not manufacture ceramic sanitary-ware to standard quality norms. Moreover some of these manufacturers use the word "Vitreous" along with their brand name whereas they do not meet the water absorption standards and thereby are misleading the consumers
Outlook for Sanitary-ware Industry in India:
In the next decade, India is expected to be one of the world's fastest growing countries for sanitary-ware consumption. The sanitation penetration has more than trebled from 8% in 1982 to 18% in 1994 and to 29% in 1999.
The comparative penetration levels in neighboring countries are as follows: Pakistan: 50%, Sri Lanka: 65%, Malaysia: 94% and Thailand: 96%.
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The government impetus to improve hygiene and sanitation is likely to increase the demand for sanitary-ware in India. Moreover the increasing urbanization of India and the consequent requirement for residential and commercial buildings will be a major driver for growth of sanitary-ware. Along with this the focus of the central and state governments to provide housing facilities to the poor, is also expected to generate demand.
The National Housing Policy formulation that envisages "Housing for all" by the end of Ninth Plan period is a big step towards this. Indira Awaas Yojana, Samgra Awaas Yojana are programs for providing housing to the rural poor is a key step taken by the government in this area. The housing development organizations like HUDCO, State Housing Development Boards and Rajiv Gandhi Rural Housing Corporation Ltd. are also playing a large role in this initiative.
It is estimated that there is currently a demand for 20 million housing units in India. Further, a significant number of the 115 million housing units across the country will need reconstruction for improvement. Therefore a replacement market will emerge, though currently original equipment sanitary-ware market accounts for nearly 90% of the market.
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SANITARYWARE INDUSTRY STATISTICS:
1. World production: 187 Million pieces2. India's Share: 6.7 Million pieces.3.
World ranking (in production):not in the Top 10 (India A/c for 3.30%)
4. Global Industry Growth Rate: 5-7%5. Growth Rate (India Domestic
Market):10%
6. Organized sector:% Share of Production: 43%No. of units: 6
Production Capacity:103300 M.T. per annum
Actual Production:95000 M.T. per annum
7. Unorganized sector:% Share of Production: 57%
Production Capacity:136700 M.T. per annum
Actual Production:120000 M.T. per annum
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Company Profile: HINDUSTAN SANITARYWARE INDUSTRIES LIMITED
It was the year 1960 when Mr. Rajendra K. Somany established Hindustan Twyfords, in collaboration with Twyfords Ltd. of UK. With a bent towards innovation coupled with the intention to introduce vitreous china ceramics in India, he identified the sanitary-ware market as the segment of interest. Hindustan Twyfords was the first in the country to make available vitreous china ceramics, offering significant improvement from the prevalent earthenware sanitary products. Aware and focused towards the burning need for sanitation across the country, this opportunity well extended his desire for social welfare, and bringing a much needed service to the nation. This was the impetus that initiated the journey half a decade ago. With strong family support, coupled with technical collaboration from Twyfords, Mr. RK Somany established the Bahadurgarh plant, which commenced production in 1962. Every decade thereon marked a milestone of achievement in product innovation, market penetration, internal expansion as well as venturing out to new business segments – container glass and home retail.
Concentrated and strategic progress enabled business expansion through organic and inorganic growth. HSIL bought over another sanitary-ware manufacturing sanitary-ware manufacturing facility in South India, and recently commenced operations of our second container glass facility in Bhongir, A.P. Today, HSIL stands tall with strong market leadership in the building products market, and a dominant player in the container glass segment. The Building Products commands more than 38% of the market in the sanitary-ware industry, while the Container Glass is the second largest player in India. Customer Satisfaction, Product Innovation, and Quality Control are the three pillars that have fostered high levels of trust and respect for the Hindware Brand. The brand is trusted
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and respected by millions of customers and thousands of dealers across the country. The 40 million satisfied customers is testimonials to is brand ethos. With a product spectrum ranging from Sanitary-ware to Wellness, to Faucets and as of recently covering Kitchen Appliances, Hindware satisfies the need of bathroom and kitchen products.
Appreciating the evolving customer needs, Hindware’s Customer Service Division takes pride in its confidence of speedy customer support, and in providing a spectrum of service opportunities for enhancing the Hindware experience. HSIL’s institutional partners include the respectable business houses India – DLF, The Taj Hotels, GMR, Unitech, ITC Hotels, Mahindra, Infosys, Coca Cola, Pepsi, Dr. Reddy’s Laboratories, Hindustan Unilever, Peron Ricard, Pfizer, Sab Miller, Dabur, Nestle, to name a few.
This validation from the cream of India Inc. extends the confidence and conviction in its values and vision. HSIL is recognized among the top 300 companies in India, while rated amongst the best 100 small and medium sized companies in the world by the Forbes Magazine. HSIL is the first company in the Building Materials Industry to be awarded the prestigious ISO 9001, 14001 and OHSAS 18001 certificate, awarding effective quality management and environment systems. It was also the first in the country to receive the ISI license.
With its recent foray into the retail of Home Interior solutions, we have extended our outreach to the end-customer. EVOK, our retail brand specializes in providing a comfortable and convenient one-stop shopping experience.
Currently located in NCR, upon consolidating its hold within North India, EVOK plans to become the household’s most preferred shopping destination. HSIL’s corporate office is located
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in Gurgaon, with eight regional offices covering the length and breadth of the country. It now has four manufacturing units, one located in Bahadurgarh, Haryana, while the other three are located in Andhra Pradesh.
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Part Two
The Main Study
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Objectives of the Study
To rank the sanitary-ware companies in terms of their
market share.
To provide Berger Paints India Ltd with market
information which would lead to the development of
newer distribution channels for their paints in the form of
sanitary-ware shops.
To forge a successful collaboration between the sanitary-
ware industry and paint industry.
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NATURE OF THE STUDY
Berger Paints India Limited are toying with the idea of collaborating with sanitary-ware dealers so that they can stock their paints. This would provide the company with newer distribution outlets and help them to reach wide areas with the help of the long standing sanitary-ware dealers. With this the company would be benefited immensely as they would not have to look for new dealers who deal solely in paints. For this purpose, the company conducted a market survey of sanitary-ware dealers in the city of Kolkata to know about the market standing of each. A structured questionnaire was provided on which the dealers were questioned about the nature of products they stocked, their annual turnover and the area of godown. They were also asked whether they wanted to collaborate with a paint company. This was done with a view to evaluate the commercial viability of such a collaboration, if any. The questions were strategically chosen such that every aspect of the dealer came to the fore.
The survey was conducted across the city of Kolkata and a total sample size of 120 was ascertained. Out of the total 120, 70 dealers participated in the survey. The areas were as diverse as Behala in the southern fringes of the city to Dumdum, the northernmost part of the city. The survey was conducted over a period of 25 days.
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Research Methodology
The research comprised primary and secondary data. The primary data was collected by visiting sanitary ware dealers across the city of Kolkata and asking them whether they wanted to forge collaboration with any paint company. For this, a structured questionnaire was provided by Berger itself on which the dealers’ answers were noted down. The questionnaire included questions so as to analyse the dealers’ market standing which would give Berger a heads-up regarding the business viability in case the dealer wanted to collaborate with it. The financial standing of the dealer would be revealed by such a questionnaire and it could also be found out if the dealer had sufficient shelf space in order to accommodate paint products. For locating the dealers, no prior database was provided and I had to scour Kolkata in almost its entirety to search for interested dealers. The market survey was spread over a period of 25 days in the months of December’09 and January’10.
The secondary aspect of the research comprised of information obtained from the websites of the sanitary ware companies which helped to learn more about their market standing and commercial operations, also their profitability in the current scenario. The combination of primary and secondary data helped me to reach some concrete conclusions.
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RESEARCH REPORTNAME OF THE DEALER
CONTACT PERSON ADDRESS
PHONE NO.
Akash steel industries Mr.A.Sharma 39,strand rd,kol-6 22437314
S.Roy & co 142 B,SP Mukherjee rd,kol-26
Modak buildersMr.Shyam Agarwal 108, Raja S.C Mullick rd,Kol-92 24122788
A.K Trading Mr. Khokan Das 598,Boral main rd, kol-84 9830185914
M.S Builders Mr.Argha Ghosh 103/B,S.P.Mukherjee rd,kol-26 9830364244
Sani Care 144-K,S.P.Mukherjee rd,kol-26
Panja sanitary forumMr.Subhash Panja 142-B,S.P.Mukherjee rd,kol-26
Sri Balaji tiles and sanitation Mr.K.Agarwal 522,D.H road,Behala Manton,kol-34 9433993932
Nirman sanitary Mr.R.Das 440,Raja S.C Mullick rd,Baghajatin,kol-86 24252286
The Shibisco 499,D.H rd,kol-34 24687026
Somany ceramics ltd Ms.Trupti Dutta 54/D,Hazra rd,kol-19 65224332
Shubham marble and sanitation Mr.S.Jaiswal 227,D.H rd,kol-34 24468252
Radha marble and sanitation Mr.L.Kundu 115,Bidhan Sarani,kol-4 5553434
Lokenath sanitary 237A,D.H rd,kol-34 24451786
Dolphin sanitary Mr.S.Basu 226,D.H rd,kol-60 24451397
Sasmal & coMr.Biplab Sasmal 639,D.H rd,kol-34
Jaiswal sanitary storesMr.Chandan Jaiswal 54/4C,Hazra rd,kol-19 24761615
Hindustan tiles company 122C,Karl Marx sarani,kol-23 24592186
Sree Durga HardwareMr.Binoy Chatterjee Naktala,kol-47
Rainbow sanitaryMr.Umesh Agarwal 2/92,N.S.C Bose rd,kol-47
BharatiMr.Gautam Kundu 11,Raja S.C Mullick rd ,kol-47 24307589
Park sanitary emporium Mr.Jogen Dutta 23/20/3,gariahat rd,kol-29 24404131
Banerjee sanitaryMr.Sukumar Banerjee 14,ramkrishna nagar,garia,kol-48 69428253
Himadri sanitation Mr.S.Roy 1,roy bahadur rd,kol-34 24683528
M.L.Roy & others Mr.D.K.Roy 28,college st,kolkata-73 65120521
Behala sanitary house Mr.K.Banerjee 535,D.H rd,Behala,kol-34
J&N TradingMr.Kalipada Dutta 76,Raja S.C.Mullick rd,kol-84 24303658
NAME OF THE DEALER
DEALING WITH PAINT COMPANY/INTEREST SHOP PROFILE
STOCKED COMPANIES
MKT.TYPE AREA(sq.ft)
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Akash steel industries Yes/No Main rd 250 Hind,Parry
S.Roy & co No/No Main rd 200 G.I pipes,Hind
Modak builders No/Yes w/s 400 Bansal,Hind,Parry
A.K Trading No/No w/s 700 Johnson,Parry,Hind
M.S Builders No/No Main rd 200 Hind,Parry,Jaguar
Sani Care No/No Main rd 250 Somany,Essco,Parry
Panja sanitary forum No/No Main rd 500 Hind,Parry,JaguarSri Balaji tiles and sanitation No/No Main rd 625 Jasper,Hind,Parry
Nirman sanitary No/No Main rd 1000 Somany,Johnson,Hind
The Shibisco No/No w/s 550 Marc,Jaguar,EssEss
Somany ceramics ltd No/Yes Main rd 550 Marc,Hind,ParryShubham marble and sanitation No/No Main rd 1000 Jaguar,Somany,ParryRadha marble and sanitation No/No w/s 525 Somany,Jaguar,Hind
Lokenath sanitary No/Yes Main rd 150 Hind,Parry,Jaguar
Dolphin sanitary No/No Main rd 200 Hind,Parry,Neycer
Sasmal & co No/No Main rd 650 Venus,Hind,Neycer
Jaiswal sanitary stores Dealing Main rd 275 ParryHindustan tiles company No/Yes Main rd 375 Parry,Jaguar,Essco
Sree Durga Hardware No/No w/s 600 Somany,Hind
Rainbow sanitary No/No Main rd 325 Jaguar,Hind,Parry
Bharati No/No Main rd 575 Essco,Jaguar,ParryPark sanitary emporium No/Yes Main rd 200 Hind,Neycer,Jaguar
Banerjee sanitary Dealing Main rd 375 Hind,Neycer,Parry
Himadri sanitation No/No Main rd 300 Hind,Neycer,Parry
M.L.Roy & others No/No Main rd 300 Marc,Jaguar,Parry
Behala sanitary house No/No Main rd 400 Hind,Orient,H.B
J&N Trading No/No Main rd 475 Essco,Hind,Parry
NAME OF THE DEALER CONTACT PERSON ADDRESS PHONE NO.
Lokenath sanitary Mr.Ashish Dutta Raja S.C.Mullick rd,kol-32 24130362
Standard Mosaic and Sanitary 24/4A,College st,kol-73 22418155
Dutta sanitary and hardware Mr.B.K.Dutta B-92,Sukanta mkt,Jadavpur,kol-32 24142320
Das associates Mr.Suren Das 27/A-1,Raja S.C.Mullick rd,kol-92 24122166
Kumar Samanta &co Mr.Ashim Samanta 37A,College st,kolkata-73 22416163
Nanadalal Kundoo Mr.N.Kundoo 2/23,Vidyasagar,kolkata-47 24253038
Shivam Paints & sanitary Mr.S.Kejriwal 94,Raja S.C.Mullick rd,kol-47 9831009528
M.L Roy & co Mr.S.Roy 28,college st,kolkata-73 22418241
R.M Chatterjee iron foundry Mr.S.Basu 110,college st,kolkata-12 22417876
Subhadra sanitary Mr.K.Ghosh 1,Arpuli lane,kolkata-12 22411896
Supreme marble & sanitation Mr.K.Jaiswal 9,canal east road,kolkata-67 23562088
Calcutta plumbing stores Mr.Krishna Sanyal 25,college st,kolkata-73 22419529
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Joy Maa Santoshi sanitation Mr.Amit Jaiswal 112,College st,kolkata-12 32402360
N.Dutt & co Mr.Nilratan Kundu 39-1,college st,kolkata-73 22417009
Gaurab trading co Mr.Gaurab Khandelwal 35,jadunath dey road,kolkata-12 22370080
Modern sanitation Mr.Soumo De 2,college st,kolkata-12 9830741302
South sanitary sales Mr.Debashish Hazra 174/1,n.s.c bose rd,kolkata-40 24811887
Ma Durga enterprise Mr.Arun Dutta 100A,N.S. C. Bose rd,kolkata-40 24712177
Home Décor Mr.Sudipto Bhattacharjee 14,college st,Kolkata-12 9830482877
N.K sanitary Mr.K.N.Bihani 37,Maharana Pratap Sarani,kolkata-1 22218631
Sonu sanitation Mr.Ajay Gupta 27,jadunath dey rd,kolkata-12 9883089962
Monmotho enterprise Mr.Tarun Chatterjee 23,college st,kolkata-73 22192999
Annapurna sanitary Mr.Swapan Kar 4,Jadunath Dey rd,kolkata-12 22122280
A.R sanitation Mr.Gyan Jaiswal 35,jadunath dey rd,kolkata-12 30270714
Ghosh & sons Mr.Arabindo Ghosh 4,jadunath dey rd,kolkata-12
C.A sanitation Mr.Bholanath Biswas 11,Akshoy Bose lane,kolkata-4 9830198705
Neelachal Mr.Jayanta Roy Chowdhury 2,jadunath dey rd,kolkata-12 40072504
Jaytee sanitation Mr.Karan Jaiswal 10,jadunath dey rd,kolkata-12 22120882
NAME OF THE DEALER
DEALING WITH PAINT COMPANY/INTEREST SHOP PROFILE
STOCKED COMPANIES
MKT.TYPE AREA(sq.ft)Lokenath sanitary Yes/No On lane 600 Hind,ParryStandard Mosaic and Sanitary No/Yes On lane 375 Hind,Neycer,C.IDutta sanitary and hardware No/No On lane 350 Hind,Marc,Johnson
Das associates No/No Main rd 550 EssEss,Jaguar,EsscoKumar Samanta &co No/No w/s 350 Parry,Hind,Jindal Nezon
Nanadalal Kundoo No/No Main rd 600 Kajaria,Marc,C.IShivam Paints & sanitary No/Yes w/s 500 Parry,Hind,Jaguar
M.L Roy & co No/No w/s 450 Parry,Hind,NeycerR.M Chatterjee iron foundry No/No Main rd 600 Hind,Parry,Sanyo
Subhadra sanitary Yes/No Main rd 200 Marc,Kajaria,JohnsonSupreme marble & sanitation No/No w/s 800 Mirano,Johnson,HindCalcutta plumbing stores No/yes On lane 200 Orient,Marc,JohnsonJoy Maa Santoshi sanitation No/No w/s 100 Jaguar,Parry
N.Dutt & co Yes/No w/s 400 Leader,Auram,Suman
Gaurab trading co No/No w/s 100 Eagle
Modern sanitation No/No w/s 2000 Parryware,Hindware
South sanitary sales Yes/No w/s 300 Supreme,Jaguar,Parry
Ma Durga enterprise Dealing Main rd 1000 Parry,Roca
Home Décor No/No w/s 200 Johnson,Kajaria,Orient
N.K sanitary No/No w/s 350 Parry,Hind,Sanyo
Sonu sanitation No/No w/s 100 Parry,Jaguar,Essco
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Monmotho enterprise No/No w/s 300 Hind,Parry,G.I
Annapurna sanitary No/No w/s 84 Parry,Neycer,Hind
Ghosh & sons No/No w/s 300 Hind,Parry,Johnson
C.A sanitation No/No w/s 150 Parry,Hind,Neycer
Neelachal No/No w/s 170 Parry,Cera,Neycer
Jaytee sanitation No/No w/s 150 Jaguar,Essco,Marc
NAME OF THE DEALER CONTACT PERSON ADDRESS
PHONE NO.
Ankit sanitation Mr.Pawan Sharma 112,college st,kolkata-12 22374019
Shivam sanitation Mr.Anupam Shrivastava 9C,Nirmal chandra st,kolkata-12 22122559
Krishna hardware Mr.Raju Dutta 105,Dum Dum rd,kolkata-74 25481208
Sanitary Palace Mr.Rajat Chatterjee 57/4B,N.S.C Bose rd,kolkata-40
Roy Bros. Mr.Milon Roy 140A,S.P Mukherjee rd,kolkata-26 24668754
N.I Enterprise Mr.Nikhil Bansal 188/1,N.S.C Bose rd,Bansdroni,kolkata-40 9831186807
Supreme Sanitation 57B,N.S.C.Bose rd,kolkata-40
Kalicharan De & sons Mr.K.Mullick 35,college st,kolkata-73
Jalaram Industrial Mr.Nikunj Parekh 40,Strand rd,kolkata-1 22304649
Ashutosh Roy & sons Mr.Probir Roy 110,college st,kolkata-12 22370802
Sanitary forum 131/42,N.S.C Bose rd,kolkata-40 24811399
Ambika Agency Mr.Dheeraj Jaiswal 2,Jadunath Dey rd,kolkata-12 32962325
Mahamaya Mr.Arjun Roy 95,S.P.Mukherjee rd,kolkata-26 9007439254
NAME OF THE DEALER
DEALING WITH PAINT COMPANY/INTEREST SHOP PROFILE
STOCKED COMPANIES
MKT.TYPE AREA(sq.ft)Ankit sanitation No/Yes w/s 300 Hind,Parry,Jaguar
Shivam sanitation No/No w/s 100 Johnson,Marc,Parry
Krishna hardware Yes/No On lane 480 Parry,Hind,Jaguar
Sanitary Palace No/Yes Main rd 500 Hind,Neycer
Roy Bros. No/No w/s 250 Supreme,Essco,G.I
N.I Enterprise Yes/No w/s 500 Parry,Essco,Jaguar
Supreme Sanitation No/No w/s 350 Kajaria,Somany,Johnson
Ray Indra Chandra No/No w/s 200 Parryware,Nelco,Essco
Kalicharan De & sons No/No w/s 200 Hind,Parry
Jalaram Industrial Yes/No w/s 200 Cera,Marc
Ashutosh Roy & sons No/No w/s 400 Hind,Essco,H.B
Sanitary forum Yes/No w/s 500 Jaguar,Hind,Parry
Ambika Agency No/Yes w/s 150 Parry,Marc,Hind
Mahamaya No/No Main rd 300 Parry,Hind
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SUMMARY OF FINDINGS
During the course of the internship, several areas of the city were traveled to question sanitaryware shop owners about their interest in collaborating with paint companies. The inferences from this project are discussed as follows:
1) In the central region of the city, comprising the areas of Bowbazar, College Street, C.R.Avenue, the sample size was 55 shops out of which 30 participated in the survey. Out of these 30, only one was interested in collaborating with a paint company.
2) The stretch from Garia to Tollygunge provided a sample of 20 shops out of which 9 participated. Among these, one was already in collaboration with a paint company while others were not too keen on it.
3) Areas such as Hazra road, S.P.Mukherjee Road provided a combined sample of 40 shops out of which 23 participated. Amongst these, five showed some interest in collaboration with a paint company as they treated it as a different line altogether.
4) Dumdum and adjoining areas of Lake Town,Nager Bazar.did not yield any positive results either as only three dealers participated.
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5) Ballygunge Phari had a dealer already stocking paints and one showed interest in collaborating with a paint company.
6) Kidderpore was a futile effort as there were not too many dealers present in the first place.
7) Dalhousie and nearby areas of the Howrah Station also proved futile.
8) Jadavpur provided a sample of 7 dealers out of which 4 participated. 2 dealers showed interest in a collaboration.
9) Behala was a huge market and had a sample size of 20 dealers out of which 10 participated. Amongst these, 2 already dealt in paints and one showed interest in entering the paint business
.
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Reaction from the dealers
The questionnaire provided proved to be accurate in most cases as it covered all the relevant topics with regard to the business of sanitary goods. However, most dealers were unwilling to reveal their annual turnover figures. Upon much persuasion and on realizing that we did not mean any harm, some gave in. The following dealers reacted positively when asked about their annual turnover:
1) Ma Durga enterprise reported an annual turnover of approxiamately 42 lacs accruing from their sanitaryware dealership as well as paint dealership. They are an authorized dealer of Asian Paints.
2) J&N Trading reported an annual turnover of Rs.7 lacs.
3)Lokenath sanitary reported an annual turnover of Rs.11 lacs.
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GRAPHICAL ANALYSIS
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Asian Paints30%
Kansai Nerolac20%
Berger19%
ICI12%
Others19%
Market share of Paint Companies in India
The above diagram is a pictorial representation of the paints market in India. It takes into account the major players in the paint industry and draws up a comparative analysis between them. The market share in terms of revenue is highlighted. Asian Paints is at the top followed by Kansai Nerolac while Berger comes in a close third. These figures are from a survey conducted in August 2009.
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Hindustan Sani-taryware India
Limited45%
Parryware30%
Others25%
Market Share of Sanitaryware Companies in India
The above figure is a pictorial representation of the sanitary ware industry in India. The different companies have been graphed according to their market share in terms of revenue. Hindustan sanitary-ware industries limited have emerged as the biggest player in this industry with 45% market share. Parryware comes in a distant second with 30% market share. They are followed by others such as Jaguar, EssEss and Cera. The data is of the year 2009.
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Interested14%
Not Interested76%
Already Dealing10%
Graphical Analysis of Survey Findings
The above figure refers to the data collected during the course of the market survey. The brief given to me by the company was to question sanitary-ware dealers whether they wanted to forge a collaboration with a paint company. To this, most of the dealers replied in the negative as they thought they were not in a position to enter into such a joint venture. This constituted 76% of the respondents. 10% of the dealers contacted already had a dealership in paints simultaneously with their sanitary-ware business. Only 14% of the dealers showed a keen interest in collaborating with a paint company as it meant a good business opportunity and they could then enter newer markets. The details of the interested dealers were duly intimated to the top management of the company.
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Limitations of the Market Research
During the course of the market research spread over a period of 25 days, certain limitations were identified which are as follows:
1) The dealers had to be visited during their business hours . As a result many felt the survey to be an unnecessary interruption in their work and refused to participate.
2) Some dealers were hostile in their attitudes and did not provide the relevant information in its entirety.
3) Some dealers were apprehensive about my original identity as no authorization had been provided by the company. This led to them refusing to disclose confidential information such as their annual turnover, godown size etc.
4) No database of the dealers had been provided by the company. As a result of this, it was necessary to travel to every corner of the city to search for interested dealers. This made the job all more difficult as some places like Kidderpore and Dumdum did not yield any positive results. There was a dearth of sanitary-ware dealers in these areas. This unfavourable situation could have been avoided if a database had been provided.
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CONCLUSION
The market survey has provided me with very important and conclusive results as to the nature of the industry and the various forces at play. It has given me considerable understanding and exposure to the market. The sanitaryware market in Kolkata has proved to be highly competitive with many dealers vying for the customers’ attention. This project has helped me to gain immense first-hand experience as to how the sanitaryware market functions in the city.
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Bibliography
1) www.bergerpaints.com 2) www.hindware.com 3) www.allbusiness.com 4) Business World magazine
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Part Three
ANNEXURE
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