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N. L. Dalmia Institute of
Management Studies & Research
Why “Foxy Lady” car?
N. L. Dalmia Institute of
Management Studies & Research
Market scenario of passenger cars
• Market share & Total sales 2012
GM, 3.20% Ford, 2.40%
Honda, 4.20%
Mahindra, 1.80%
Others, 2.90%
Tata Motors,
Maruti, 47.30% 12.70%
Hyundai, 25.50%
N. L. Dalmia Institute of
Management Studies & Research
Growth in passenger car sales
30%
25%
20% 25% 26%
20% 20% 24%
15%
10%
10%
5%
0%
2007
2008
2009
2010
2011
2012
N. L. Dalmia Institute of
Management Studies & Research
India: Working population
Millions
1200
1100 1143
1034
1000
900
800
790
Growing labour
700 force in India
+31%
600
500
400
1970 1990 2010 Year 2030 2050 2070
N. L. Dalmia Institute of
Management Studies & Research
Target segment
40.00
30.00
20.00 31.13
18.99
10.00
4.60 2.82
0.00
Labour force Employed in Senior mgmt in Board of directors
organisations organisations
N. L. Dalmia Institute of
Management Studies & Research
Product segmentation
N. L. Dalmia Institute of
Management Studies & Research
Major expected competitors
N. L. Dalmia Institute of
Management Studies & Research
Porter’s five forces
Threat of new entrants
(Moderate)
Industry competitors
Bargaining power Bargaining power
of suppliers of buyers
(Medium) (Very low)
Rivalry among existing players
(Low)
Threat of substitutes
(Low)
N. L. Dalmia Institute of
Management Studies & Research
Product life cycle
700 0
Sales
600 0
500 0
400 0
300 0
200 0
100 0
Year
0
STRENGTH
• Well developed sales and service network
• Strong customer base and brand image
• Unique product
• Specially designed for targeted segment
N. L. Dalmia Institute of
Management Studies & Research
SWOT analysis
WEAKNESS
• Other segments can’t be served
• May affect sale of other car models
N. L. Dalmia Institute of
Management Studies & Research
SWOT analysis
OPPORTUNITY
• Untapped market available
• Enhancing the existing brand value
• Product range for entire household
N. L. Dalmia Institute of
Management Studies & Research
SWOT analysis
THREAT
• Possibility of new entrants
• Dependency on fuel prices
• Increase in traffic congestion
N. L. Dalmia Institute of
Management Studies & Research
BCG matrix
In 2 years
STARS QUESTION MARKS
Alto SX4
Wagon-R Omni
N. L. Dalmia Institute of
Management Studies & Research
Porter’s generic strategy
Cost leadership
• Investment in state of the art technology
• Common engine technology shared between
different product lines
• Just-in-time supply logistics
• Kaizen for improving in-house capabilities
N. L. Dalmia Institute of
Management Studies & Research
Porter’s generic strategy
Differentiation
• Innovation in product features
• Unique product for a specific segment
• Use of brand name and improving it continuously
• Use of highly fuel efficient and technologically
advanced engine
• Huge network of service centers for achieving
“360 degrees customer experience”
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PRODUCT
• Specially designed car for ladies
• Additional safety features
• Classic feminine look with a range of vivacious
interiors
• Compact and easy to handle with
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PRODUCT
• Special features in place for the lady driver –
Adjustable raised driver seat
Bluetooth connectivity
Parking guide display
Vanity box
Large boot space
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PRODUCT
• Special features …(contd.) –
Automatic gear shift
Tubeless tyres with puncture endurance
Hydraulic jack
Big rear-view mirror
Child seat and child lock
Adjustable steering
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PLACE
• Target customer in urban India
• Metro cities
• Tier-2 cities
• Target customer profile
• Working ladies
• Medium to high income group
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PLACE
• Marketing channel
Manufacturer Distributor Customer
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PROMOTION
• Brand ambassador
• Advertisements in newspapers
• Advertisements on television
• Hoardings at prominent places in cities
• Sponsoring women oriented events
• PR events at dealers and service centers
N. L. Dalmia Institute of
Management Studies & Research
4 P’s
PRICE
• Pricing objective – to maintain cost leadership
• Pricing method – Skimming
• Price per car at launch – Rs. 5L
• Focus on small market segment to avoid
competition
• Targeting customers who can support
skimmed pricing
N. L. Dalmia Institute of
Management Studies & Research
Financial Projections
Amount in Rs. Crore
Particular 2013-14 2014-15 2015-16
No. of units 78000 105300 147420
Price Per unit. 0.05 0.05 0.05
Sales Turnover 3,900.00 5,265.00 7,371.00
Excise Duty -390.00 -526.50 -737.10
NET SALES 3,510.00 4,738.50 6,633.90
Growth Rate 35% 40%
Expenses
Manufacturing Expenses 2,527.20 3,080.03 3,980.34
Personnel Expenses 61.43 70.64 81.23
Selling Expenses 170.20 80.00 40.00
Administrative Expenses 52.65 60.55 69.63
TOTAL EXPENDITURE 2,811.48 3,291.21 4,171.20
Operating Profit (EBIDTA) 698.53 1,447.29 2,462.70
Op. profit as % of Sales 20% 31% 37%
N. L. Dalmia Institute of
Management Studies & Research
Break-even Point
3000
2500
Amount in Rs. Crore
2000
1500
22562 units
1000
500
0
5K 10K 15K 20K 25K 30K 35K 40K 45K 50K 55K
Revenue 250 500 750 1000 1250 1500 1750 2000 2250 2500 2750
Cost 464 653 833 1013 1193 1373 1553 1733 1913 2093 2273
Fixed Cost 284 284 284 284 284 284 284 284 284 284 284
N. L. Dalmia Institute of
Management Studies & Research
N. L. Dalmia Institute of
Management Studies & Research