JSW Shoppe A Unique

Distribution Model for

Branded Steel
By- Group 10
Ashima Gupta (09309)
Harjas Singh Kohli (09312)
Malvika Bahety (09315)
Nishit Gupta (09319)
Arindam Mukerji (241024)

Comparison of business models & effect

on distribution
Transactional business model
- Consumers pay each time
they use the service

Relationship based distribution

model
- Facilitate consumer
awareness of JSW steel
- Franchise its business model
- Partner with dealers

Effect on Steel industry distribution system

- Challenges of franchising a specialty product, evaluation of
dealers using a balanced score card, and preparation of elaborate
training module for the sales force

Change in roles of sales person from old to new business

model
Transactional business model
Finding the cause of a problem which
includes customer needs and his loyalty
towards a particular brand
Identify the customer needs and market trends
and thereby finding link between the two
Keeping regular touch with the existing
customers
Negotiating prices with the customers
Providing information to the management
about any significant changes happened in his
territory
It includes low level of interaction with the
dealers

Relationship-based model

Collection of orders from the dealers and

maintaining relationship with them at the
same time

It involves focusing on the collaboration

with the dealers

It includes high level of interaction with

the dealers

Challenges faced in implementing the new business model

Internal resistance-

Dealers sceptic -

Dealer end adaptation-

Sales executives now have

to perform more roles;
spend time at dealers,
promotional activities.
IMPACT- non compliance
to company goal. Slower
progress to goal.

Serve wider range of offerings

than one.
Heavy investment in
infrastructure.
IMPACT- will have to remain
committed to JSW and couldnt
serve other steel companies. They
feel power being taken away from
them in long term and company
wants to do away with them,
difficulty in selling

Inability to adapt to sophisticated

ordering process ensuring regular
material supply, branding SC,
cost & revenue sharing model.
Unhappy with non-customization
Impact- may not be able to
perform as per training
considering as time wastage.
Also, company may have to
rethink about new process as not
much support.

Issues & Challenges faced in Transition

Dealer selection

Need for training

Preference to young dealers> more adaptable

Criticism by saying
proximity in dealers->
cannibalization
IMPACT- Model not
suitable for all types of
markets or scalable.

Dealers and store personnel

need training & dealers
consider it waste of time
Not IT adept dealers
IMPACT- sense of
professionalism and
uniformity missing

Attracting end
customers
No basis for evaluation
to determine incentives

Balanced Score Card

Financial
Perspectiv
e

Customer
Perspectiv
e

Internal
Process
perspectiv
e

Learning/
Growth
Perspectiv
e

Need for Balanced Score Card

Evaluation
Upcoming steel demands from smaller areas, from medium and small companies,

need for branded steel, hence need for retail dealers

Traditional focus on bigger buyers to be substituted for Retail push from Steel
players
All this leading to more emphasis on dealers closing the deal, hence need for all
round evaluation of dealers and evaluation not only on the basis of ROI and
increase in sales, calling for Balanced Score Card.

Financial
Perspecti
ve

Objective: Increased profitability through Cost Benefit

Analysis
Measure: Excess Tasks to be eliminated or reduced to
provide reduced costs or enhanced revenues
Target: atleast 25% of the total tasks done in JSW Shoppe
either while selling or while procuring materials should
reduce costs
Initiatives- Effective Inventory management system

Custome
r
Perspecti
ve

Objective: Increased Customer Retention and new

Customer Acquisition
Measure: More customer satisfaction, Advertising and
branding of Jindal Steel and JSW Shoppe
Target: atleast 80% of the customers to be retained for min
6 months with min 12 new customers each month
Initiatives- Customer Loyalty Programme, Enhanced
services and better products

Learning
and
Growth
Perspecti
ve

Objective: Increased Employee retention at JSW Shoppe

Measure: Reduced employee turnover
Target: atleast 80% of the hired executives love to stay at
the Shoppe by the end of their 1 year tenure
Initiatives- Employee discounts, status upliftment of
employees, greater career opportunities

Internal
Business
Process
Perspecti
ve

Objectives- Effective implementation of Initiatives as

planned by dealer
Measures- Check percentage of goals achieved and
percentage of Initiatives developed on time
Target-80% of goals achieved and 80% of them developed
on time
Initiatives-Proper project management and review program

Sales Management Process Review

Sales Organization

Recruitment

Evaluation

160 dealer
network
Used as a kickstart
to the shoppe
initiative
Should have
incentivized the
joining for
existing dealers

New generation
dealers targetted
Separate check list
should be
employed for
selection
Shoppe executives
must be recruited
by JSW

No particular
system for
measuring
performance
Performance must
be graded based
on sale of different
materials

Extra marketing initiatives to be taken

Missionary
selling

Advertise
at rural
panchayat
s
Open an
online
store for
the urban
segment