project eicher

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

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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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http://www.ecs-limited.com/

http://www.eicherinternational.com/

http://eicherworld.com/lcvv.htm

http://eicherworld.com/demm.htm

http://www.royalenfield.com/

http://eicherworld.com/tractor.htm

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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http://eicherworld.com/#finance

http://eicherworld.com/#export

http://eicherworld.com/#efficient

http://eicherworld.com/#custom

http://eicherworld.com/#eml

http://eicherworld.com/#tech

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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http://www.eicherworld.com/

http://www.eicherworld.com/

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

41

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.


Table No. 23






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.


Table No. 24






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.


Table No. 25






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.


Table No. 26






68

Fig. 29


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.


Table No. 27






Fig. 30


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.


Table No. 28





71


Fig. 31


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

S.8. You are brand loyal and will stick to the brand you are dealing in.


Table No. 29







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.


Table No. 30






Fig. 32


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

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


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


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


Om Machinery Mandia Road 230006 Om Prakash Solanki

& Yogesh Solanki

94

KOTA

Name of Dealership


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


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


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


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


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


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


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


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


22. Response of Statement 1 65









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


25. Response of Statement-1 65







Response of Statement-8 77


33. Market Share of different Regions in 15-40HP

Engine Sales 82

106

project eicher

Documents