Thursday, December 12, 2019
Chotukool Solutions free essay sample
Assess the business scenario for ChotuKool? What are the critical success factors for this product to succeed? ChotuKool falls in to the business of refrigeration, to understand the business better let us understand the overall refrigeration business But before that lets looks at the consumer durable market, the consumer durable market consists of products from watches to fans. With the help of the below mentioned data we can understand the penetration and reach of a consumer durable like refrigerator in comparison to a product like Television Set, car, bike or Grinder. This will help us in having a deeper knowledge of the placement of a retrigger in the minds of the consumer in comparison to other consumer durables. With the analysis of the below shown chart we understand that refrigerators have been able to penetrate only 46% of the urban market on the other hand it has barely scratched the rural market by just reaching a meager 8%. We will write a custom essay sample on Chotukool Solutions or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Overall most of the consumer durable shown below have a decent reach in the rural markets except for car and refrigerators, this helps us understand that there is an untapped market available in the rural areas for this specific consumer durable Ownership of consumer durables (% of household) Refrigerators Pressure cooker Bicycle Wrist watch Ceiling fan Mixer/Grinder Colour TV Motorcycle Car 0% 3% 12% 19% 17% 19% 34% 48% 56% 54% 8% 38% 53% 69% 76% 88% 89% 46% 80% Urban Rural 20% 40% 60% 80% FY 2008 Ã¢â¬â 09| Rs/cr| ACamp;R industry market size| 14,200 (US$ 3. 0 B)| Airconditioning systems| 11,000| Commercial refrigeration| 2,000| ACamp;R servicing| 1,200| * Approximately 69 per cent population resides in rural India, yet only 35% sales is contributed by rural markets. However, this sales contribution is expected to increase to 45% in near future. * Rural Consumer durables markets is growing by 30 per cent currently, expected to grow by 45 per cent in FY12 80 lacs Refrigerators sold last year and the market has grown by 12-15% (2010) Commercial Refrigeration Sector Ã¢â¬ ¢ Growth during last 5 years: -10% Ã¢â¬ ¢ Expected growth during medium term (3-5 years): 10-12% Looking at these figures we can see that the Domestic Refrigerator market in IndiaÃ is one of the fastest growing segments of the consumer durable industry and is witnessing significant growth on account of rising per capita income and improved social indicators. The market is estimated to be worthÃ INR 97. 69 bnÃ in 2010. Over 80% of the population of India does not use refrigerators. Refrigerators have been manufactured in India since 1950s. Till the 1980s, players like Godrej, Kelvinator, Allwyn and Voltas controlled almost 90% of the market. Earlier, the white goods sector was categorized as a luxury goods industry and was subject to oppressive taxation and licensing. The situation changed after liberalization of the economy in the early 1990s. The Government removed all restrictions, and now there is no restriction on foreign investment, and licenses are no longer required. Post-liberalization, a number of foreign companies entered the market and many domestic players also diversified into refrigerators. BPL and Videocon who already had a presence in the consumer electronics market, leveraged their strengths to enter the durables sector. In India, refrigerators have the highest aspirational value of all consumer durables, with the exception of televisions. This accounts for the high growth rate of the refrigerator market which has been growing at a rate of about 15% per year, while the consumer durables industry as a whole has grown at almost 8%. The size of the refrigerator market is estimated to be 3. 5- 4 million units approximately, valued at Rs. 50 bn. The domestic penetration rate of refrigerators is about 9%. The penetration is considerably higher in urban areas, which account for 75% of the demand, with rural areas constituting the other 25%. The demand is also higher in the northern and western parts of the country than in the east. A study by Assocham in 2011 estimated the rural consumer durables market to grow at 40% in 2012 as a result of higher disposable income among rural consumers. The size of the home appliance market in India is pegged at `30,000 crore, with air-conditioners, refrigerators and washing machines as the largest categories, though household peneration levels are in low single-digits. Current Scenario in India, * Refrigerators have the 2nd highest aspirational value of all consumer durables * High growth rate of the refrigerator market. Refrigerators are manufactured in two basic designs which are referred to as Direct Cool (DC) and Frost Free (FF) refrigerator. GodrejÃ¢â¬â¢s share in the refrigeration market as shown below is 18 % Critical success factors for chotuKool: Let us study the critical success factors on the basis of the 4pÃ¢â¬â¢s of marketing Product: Designed specifically for rural consumer Cooling Chip Runs on low power and invertors Runs on battery when thereÃ¢â¬â¢s load shedding Colour chosen on the basis of consumer interest Use of unconventional cooling technology.