MRF TYRES

MRF TYRES

Presented by:Swapnil ChaudhariAkshay KumathRahul BanwaniKushal Rastogi 1Muechen International Business School

Introduction• The company, MRF Ltd., originally started as a

small manufacturing unit of balloons, latex cast squeaking toys and industrial gloves.

• A young entrepreneur, K. M. Mammen Mappillai, opened a small toy balloon manufacturing unit in a shed at Tiruvottiyur, Madras (now Chennai).

• The company established its first office in 1949 at Chennai

• It began the manufacturing of tyres in 1961. 2Muechen International Business School

Facts• In 1961 the Madras Rubber Factory Private

Limited was converted into a public company.

• Additional capital was issued in order to start the manufacture of automobile tyres and tubes in collaboration with the Mansfield Tire & Rubber Co., Mansfield, Ohio, U.S.A.

• The Company was given permission to export tyres having Mansfield trade mark to all world markets except U.S.A. and Canada.

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Facts• The Company was identified as `Star Exporter',

a status that enables the company to get priority treatment in several areas concerned with customs.

• MRF became the first tyre company in India to cross the INR 10 billion mark in 1993

• The Company has received the Top Export Award for the year from All India Rubber Industries Association in 1995 and has been receiving the same regularly since then.

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Facts• MRF Tyres has signed an OEM (original

equipment manufacturer) alliance with various automobile giants.

• Funskool, the No. 1 toy company in India, is a joint venture between MRF tyres and the world's largest toy company Hasbro Inc., USA.


Products• Tyres


Products• Conveyor belts


Products• Pretreads


Products• Industrial Paints and Coatings


Plant locations in india• Tiruvottiyur, Chennai• Kottayam, Kerala• Usgao, Goa• Arakkonam, Tamil Nadu• Medak, Andhra Pradesh• Pondicherry


INDUSTRIAL MARKETING• Industrial marketing consists of all activities

involved in the marketing of products and services to organizations that use product and services ,in the production of consumer or industrial goods and services ,and to facilitate the operations of their enterprises.

• Eg: MRF markets its tyres to various automobile giants like Maruti, Tata Motors, Honda,etc.

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Industrial Demand• The demand for industrial products and

services does not exist by itself. It is derived from the ultimate demand for consumer goods and services . Therefore Industrial demand is also called Derived demand.

• Eg. Net sales of MRF tyres was Rs 3274.37 crores in the year 2008-09


Customers


FIVE FORCES MODEL


KEY COMPETITORS


RAW MATERIALS


• Number of Suppliers – Low

• Availability/ acceptability of raw material substitutes – Low

• Switching costs – High

• Threat of forward integration – High


BARGAINING POWER OF BUYERS

• OEM’s High• In Replacement Market Moderate• Switching Cost Low• Threats of Backward Integration Low


THREAT OF POTENTIAL ENTRANTS• LOW, due to HIGH ENTRY BARRIERS• Highly capital intensive industry

Rs4bn for radial tyre plant with a capacity of 1.5mn tyresRs1.5-2bn for a crossply tyre plant of a capacity to manufacture 1.5mn tyres

• High raw material costs


Buyer-Seller Relationship• The most important part of buyer-seller

relationship is the interection between a buyer and sales representative.On the basis of it there are two factors are:

1. The content of information – includes product features,prices ,services,as well as individual needs of buyer and seller.

2. The style of interaction –includes mannerisms and the format used by buyer and a seller in their communication.


Various types of transactions based on style and content


Ideal Transaction

Inefficient Transactions

Inefficient Transactions

No Transactions

Compatible Style Incompatible Style

Compatible content

Incompatible content

Product Life Cycle

FLATLESS

TUBELESS

RADIAL

CROSS PLY

Major Sales Segments

Demand Categories

Pricing new product

• Skimming strategy . Selling a product at a high price, sacrificing high

sales to gain a high profit, therefore ‘skimming’ the market. Usually employed to reimburse the cost of investment of the original research into the product.

• Penetration strategy The price is deliberately set at low level to gain

customer's interest and establishing a foot-hold in the market.

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Distribution Channels • MRF has one of the largest tyre distribution

channel in India. It has divided the indian subcontinent into 33 regions and has setup a Regional office in each region.

• The basic structure comprises of the following:• Factory• Divisional Distribution Centers• Regional Distribution Centers• Carrying & Forwarding Agents• Dealers • Over 2500 sales outlets all over India


ADVERTISING• Various ads in Televisions• Billboards• Sponsors to various racing events• Sport accessories


MRF TYRES

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