Group 1

NGUYEN PHAM NHUT THIEN (Tina)

M987Z240

VU THI AI VANM987Z256

NADIA NILA SARI M987Z250

BackgroundCompetitorsRecommendation &

Analysis

Blair Company Indian Market for Home Water

Filtration and Purification Situations in market of India Traditional method for Home Water

Purification Mechanical method for Home Water

Filtration and Purification Foreign Investment in India

Eugene Blair founded Blair Company in 1975. Desalinator was the first product, used in

Florida to remove salts from brackish well water supplied to residents.

By 2000, new products were added rapidly, the product line included desalinators, particle filters, Ozonators, ion exchange resins and purifiers.

In late 1997, the final design has the brand name “Delight”

For 2000, Sale revenues would be almost $400 million, with an expected profit close to $50 million.

Annual growth in sales revenues averaged 12 % for the past 5 years.

The market seemed clearly a mature one, with 4 or 5 Indian competitors in the market.

The market was fragmented, with no large competitor having a national presence.

Competing with only one or two companies of India’s 25 states.

Its stage is in early growth stages. Many Indians felt the need for improved

water quality.

Around 40 million of better-educated, wealthier, more health-conscious consumers took steps to safeguard their family’s health and often continued these steps year-around.

Another 4 million households had similar values and lifestyles, but as yet took little effort to improve water quality in their homes.

50% of target market used water boiling method.

40% of the rest used Mechanical Methods. Including 20% used candle filters, 20% used Water Purifiers.

Boiling 2 to 5 liters of water for 10 minutes, allow it to cool, and then transfer it to containers for storage (often in a refrigerator).

This procedure is affected the palatability of water, leaving the purified product somewhat “flat” to the taste.

Boiling also was cumbersome, time consuming, and ineffective in removing physical impurities and unpleasant odors.

Candle Filters Low price depend on

material (plastic, porcelain or stainless steel) and easy of using.

Candle filters were slow, producing 15 liters (one candle) to 45 liters (3 candles).

It is needed to be removed, cleaned, and boiled for 20 minutes.

Price Rs.350 to Rs.1,100.

Water Purifiers Better than Candle

Filters. There are three steps,

the first removed sediments, the second objectionable odors and colors and the third harmful bacteria and viruses.

Price is Rs.2,000 to Rs.7,000.

Joint working arrangement• Supply key purifier components• License fees will be calculated by per unit

basis over the item of the agreementJoint venture company

Be partner with an existing Indian company Share 50% profit

Acquisition• Purchase an existing Indian company then

expand to include the water purifier• All profit will belong to us

Apply for market entry to the Foreign Investment Promotion Board, Secretariat for Industrial Approvals, Ministry of Industries.

Approval of any royalties and fees, remittances of dividends and interest by Reserve Bank of India, Ministry of Finance.

“Virtually guarantee” by consulting firm.

Corporate tax rates in India probably were somewhat higher than in the United States

The average return on assets for all Indian corporations in recent year was almost 18%, for United States corporations was about 11%.

Product : Design and Benefits Price : Skimming or Penetration Strategy Distribution : Dealer Promotion : Advertising and door to door Strategic focus market : Urban or Rural Market Entry : Licensee or Joint Venture

Benefits : • Remove four types of contaminants found in

potable water – sediments, organic and inorganic chemical, micro bials or cysts, and objectionable tastes and odors.

• Technology is effective as long as contaminants present at the “reasonable “ level.

• Beyond WHO standard of technology to purify.

Product Design : • Model and specific appearance reflect a western,

high technology school of design to distinguish the Delight purifier from competitors products.

• Two kind of design : wall mouth design and countertop design. Customer prefer the countertop model better then wall mount design.

Delight purifier

Technical detail DELIGHT PURIFIER: Filter flow rates Storage capacity Unit layout Overall dimension Number of special feature

▪ Possibility of small battery to operate the filter for several hours in case of a power failure

▪ “bells or wristles” to tell them that the unit indeed was working properly.

▪ Allow users to add floride, vitamins, and flavoring in their water.

Wall Mount Water Purifier

Countertop Water Purifier

Feature Delight Singer ZERO-B PureSip Aquaguard

Price 4,400 - 5,900 4,000 2,000 5,500 2,000

Remove Sedimentation √ √ √ √ √

Remove Heavy metal √ √ X X √

Remove Odor √ √ √ √ (Weak) √ (Weak)

Remove color √ √ √ √ √

Kill Bacteria & Viruses √ √ √ √ √

Fungi √ √ X X X

neriatodes √ √ X X X

Remove bad taste √ √ √ X X

Flow rate fastest 3.8 liters/min n/a n/a n/a

Life time n/a 40,000 liters, 70,000 liters 1 yr (filter) n/a n/a

Maintenance Cost n/a n/a Rs.200/yr n/a n/a

Require electricity √ n/a X X √

Additional Feature

 Battery, too high standard n/a Iodine n/a stored safely

Skimming Pricing & Penetration Pricing DEALER CUSTOME

RCONTRUBUTION MARGIN

Skimming Strategy

Rs. 5,000 Rs. 5,900 Rs. 650

Penetration Strategy

Rs. 4,100 Rs. 4,400 Rs. 300

Our group choose skimming pricing strategy which is the price will sets relatively high  price at first, then lowers the price over time.

With below consideration : Image of the product : high innovated

positioning in the market. Allow return for the set up cost for first

launch in advertisement and promotion. Positioning in ‘prestige’ conscious than

price conscious.

Pricing strategy

DISTRIBUTION :For the distribution, we will open several dealer in urban area especially on West coast, also open small booth / stand in existing shop of patnership company.

PROMOTION :Door to door salesforce being an effective advertising to introduce the benefits of Delight purifiers, besides the product will be advertise in newspaper, magazine and television.

Approximately 80% of diseases in India are caused by water borne micro organisms, awareness of health risks linked to unsafe water is still very low among the rural population.

The urban Indian is definitely more health conscious and understands the necessity of purifying water before it is fit for consumption. It is estimated that roughly 7% of urban Indians use non manual water purifiers.

Besides, the lack of adequate distribution and communication infrastructure in rural of India meant that any market entry would begin with larger Indian cities, most likely on the west coast. So, Delight purifier will be focus on Urban market.

Licensee Consideration :

Disadvantage :- Couldn’t have fully control

over the licensee’s operations- Create technology may

always depend on the supplier

Advantage :- Company financial

investment would be minimal.

- Possible to reach the market faster.

Joint Venture Consideration:Disadvantage :- Financial investment & annual

fixed would be much higher- Different cultures and

management styles result in poor integration and co operation

Advantage : - Have fully control over the

production, operation and standardization of product

- Provide companies with the opportunity to gain new capacity and expertise

- access to greater resources, including specialized staff and technology

- sharing of risks with a venture partner

Based on the consideration above, we prefer Delight purifier to entry the market by joint venture.

With below consideration : the product of Delight purifier need a lot of control

on their operation to keep the product on high quality and standard as it is sets the product as high innovated water purifier.

Allow company to know new geographic markets in India ( ex. Rural market ) or do innovated

Sharing risk to the partnership company The partnership will be with one of Indian company

that promising like : Polar Industries, Milton Plastic, Videocon Appliance, BPL Sanyo Utilities and Appliance, Onida Savak, Hawkins India, Voltas.

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