INSTITUTIONAL SALES MAPPINGAT VOLTAS LTD.

By Tathagata

Roy IBS

Mumbai

INTRODUCTION

Voltas – A part of TATA Group It was established in 1954 in Mumbai as a JV

between M/s Volkart Brothers and TATA Sons Ltd. 1956 – The company went public and Volkart

brothers sold their stake in the company. 1961- Voltas marketed imported products. 1963 – first factory was established to

manufacture ACs and refrigeration equipment. Later on many plants were set up to

manufacture compressors, condensers, chillers, ancillaries, refrigerators etc.

BUSINESS ORGANIZATION

VOLTAS is into

Over the years Voltas tied up with US based Dunham Bush & Standard refrigeration company.

To secure access to new technologies in air conditioning and refrigeration market.

By 1990 Voltas diversified extensively in industries like food and beverages, forklift trucks, chemicals, pesticides, engineering services, etc.

In 1996-97 the market shrunk by 9% (refrigerators) and it was a severe blow to Voltas.

In 1996-97 company recorded it’s first ever loss of 170 million and also failed to pay dividend.

The price of stock crashed from Rs 225 to Rs 21. So in 1997 MD Munshi was replaced by Nawshir

Khurody. A huge restructuring process was followed which

involved all the businesses of Voltas and it’s finances and human resources.

It was decided that the company would focus on its air conditioning and engineering businesses.

This exercise finally helped Voltas improve it’s profitability.

RESTRUCTURING

One core management team started to analyze the viability of each business.

Incompetent businesses to be sold

Air conditioning and engineering were two profit making businesses.

Idle assets were either leased or were sold.

In 2000 four refrigeration manufacturing units were sold to Electrolux.

Realized around 4.1 billion from sales of its businesses.

Voltas grouped its remaining businesses into 4 segments.

To reduce cost Voltas started to reduce its workforce.

Encouraged new talents and ideas.

REVENUE OF VOLTAS

1996-97-170 million

1998-99-119 million

2000+ 69 million

VOLTAS IN 2000

Started looking for new profit making businesses.

DIVIDEND OF 12%

Aim to increase operating margin

NEW AVENUES FOR GROWTH

THEELECTROMECHANIC

ALBUSINESS

THE UNITARY COOLINGBUSINESS

THE ELECTROMECHANICAL BUSINESS

Very successful working internationally also

Voltas India Limited used to produce these products.

In 2001 VIL merged with Voltas. Opened offices in many other countries. Taking projects in India as well 40% share in Indian CAC market Market leader in CAC market – Blue Star

THE UNITARY COOLING BUSINESS

MARKET LEADERWITH 40% MARKET SHARE

MAJOR PLAYERS – BLUE STAR, CARRIER

MANUFACTURED REFRIGERATOR UNDER COLDCEL NAME

ABOUT THE PROJECT

Institutional Sales Mapping

Had to do a survey regarding the usage of air conditioners of various companies in Mumbai

Visited almost 350 companies for the survey and took a feedback

The data obtained was then grouped and analyzed.

Pie charts were constructed to obtain and deduce the result.

METHODOLOGY

Research methodology is considered the nerve of the project. Very important to come to a final deduction.

Research Design.

Data Collection Methods Primary data 1. Sampling 2. Research Instruments 3. Secondary Data 4. Data Analysis and Interpretation a. Questionnaire b. Pie Charts

LIMITATIONS

Not willing to share information with just anybody and everybody.

Biased information.

Suspicion.

Duration of my project.

Convincing people that it is just a study and nothing else.

ANALYSIS OF PRIMARY DATA

Hospitality --- 20%Hospitals --- 16%

Voltas --- 39%LG --- 25%

39%

25%

13%

4%

1%

11% 4%4%

AWARENESS

Voltas LG SamsungHitachi Blue StarVideoconOGCarrierMitsubishi

0-25 --- 66%26-75 --- 28%

65%

28%

6%

USAGE

0-2526-7576-150Above 150

Others --- 41%LG --- 26%

26%

7%

18%8%

40%

BRAND USAGE

LGSamsungVoltasHitachi Others

0-50 --- 83%51-100 --- 17%

83%

17%

YEARLY PURCHASE

0-5051-100101-200201-300Above 300

LG --- 33%Hitachi --- 23%

5%

33%

2%19%

23%

5%4%

5%4%

PURCHASE CONSIDERATION

Samsung LG VideoconVoltas HitachiBlue StarCarrier OGMitsubishi

LG --- 32%Voltas & Hitachi --- 20% each

4%8%

20%

20%

33%

3%9%3% 3%

EXPERIENCE

Videocon SamsungHitachiVoltas LGBlue StarOGCarrierMitsubishi

LG-Qualis --- 48%LG-Honda City --- 31%

8% 14%

31%

48%

LG

LG-AltoLG-PajeroLG-CityLG-Qualis

Samsung-Pajero --- 50%Samsung-Honda City --- 20%

19%

50%

20%

11%

SAMSUNG

Samsung-AltoSamsung-PajeroSamsung CitySamsung-Qualis

Voltas Alto --- 51%Voltas Pajero --- 24%

51%

24%

11%

14%

VOLTAS

Voltas-AltoVoltas-PajeroVoltas-CityVoltas-Qualis

Hitachi-Honda City --- 39%Hitachi-Qualis ---25%

23%

14%

39%

25%

HITACHI

Hitachi-AltoHitachi-PajeroHitachi-CityHitachi-Qualis

LG-Cheetah --- 41%LG-Monkey --- 36%

17%

6%

41%

36%

LG

LG-LionLG-White ElephantLG-CheetahLG-Monkey

Samsung-Monkey --- 33%Samsung-Cheetah --- 30%

17%

20%

30%

33%

SAMSUNG

Samsung-LionSamsung-White ElephantSamsung-CheetahSamsung-Monkey

Voltas-White Elephant --- 66%Voltas-Lion --- 16%

16%

66%

10% 9%

VOLTAS

Voltas-LionVoltas-White ElephantVoltas-CheetahVoltas-Monkey

Hitachi-Lion --- 51%Hitachi-Cheetah & Monkey --- 20% each

51%

9%

20%

20%

HITACHI

Hitachi-LionHitachi-White ElephantHitachi-CheetahHitachi-Monkey

Purchase From Dealers --- 65%Direct Purchase --- 31%

4%

31%

65%

MODE OF PURCHASE

TenderingDirect PurchasePurchase from the Dealers Others

0-15 --- 83%16-20 --- 8%

83%

8%1% 3% 5%

BRANCHES

0-1516-2021-3535-50Above 50

FINDINGS

AC industry is here to stay.

Improve quality with innovative design.

Cost reduction and high quality service are not the only criteria.

Brand building and promotion of the brand.

Advertising and post sales service is low as compared to it’s potential.

Voltas needs to tackle not only the direct forms of competition but also indirect competition.

LEARNINGS

Corporate exposure.

Enhance our marketing and selling skills.

Meet top level Executives.

Realization of work life culture.

RECOMMENDATIONS

A concerted effort to promote Voltas products through advertising & branding should be launched.

Need highly focused marketing strategies to provide the target segments with compelling customer value propositions.

Trust relationships with customers should be improved.

The company must be ready to incur the high customer acquisition costs required for brand marketing.

Company need to offer low cost service trials to early adopters of AC technologies who maintain opinion leadership within their social communities.

CONCLUSION

There is no substitute for quality.

The company must be aware that the awareness of the product and services is like half the battle won.

They need more quality innovative and competitive price structure products and services.

Allocation of funds to marketing should be increased in order to make more headway into the market among the competitors.

THANK YOU