A PROJECT WORK ON “Market Analysis of Amaron two wheeler batteries in Hyderabad”. ”. A Project report submitted to Institute of Public A Project report submitted to Institute of Public Enterprise, Hyderabad in partial fulfillment of the Enterprise, Hyderabad in partial fulfillment of the requirement for the award of the Degree of requirement for the award of the Degree of POST GRADUATE DIPLOMA IN MANAGEMENT - POST GRADUATE DIPLOMA IN MANAGEMENT - INTERNATIONAL BUSINESS INTERNATIONAL BUSINESS SUBMITTED BY SUBMITTED BY M SRIKANTH REDDY M SRIKANTH REDDY PGDM-IB PGDM-IB 0911-51 0911-51 INSTITUTE OF PUBLIC ENTERPRISE INSTITUTE OF PUBLIC ENTERPRISE 1
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A PROJECT WORK ON
“Market Analysis of Amaron two wheeler batteries in Hyderabad”.”.
A Project report submitted to Institute of Public Enterprise, Hyderabad in partialA Project report submitted to Institute of Public Enterprise, Hyderabad in partial
fulfillment of the requirement for the award of the Degree offulfillment of the requirement for the award of the Degree of
POST GRADUATE DIPLOMA IN MANAGEMENT - POST GRADUATE DIPLOMA IN MANAGEMENT -
INTERNATIONAL BUSINESSINTERNATIONAL BUSINESS
SUBMITTED BYSUBMITTED BY
M SRIKANTH REDDYM SRIKANTH REDDY
PGDM-IBPGDM-IB
0911-510911-51
INSTITUTE OF PUBLIC ENTERPRISEINSTITUTE OF PUBLIC ENTERPRISE
OSMANIA UNIVERSITY CAMPUSOSMANIA UNIVERSITY CAMPUS
HYDERABAD – 500 007HYDERABAD – 500 007
2009- 20112009- 2011
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DECLARATION
I, hereby declare that the Summer Internship Project Work titled, “Market Analysis of
Amaron two wheeler batteries in Hyderabad” is an original work done by me under
the Supervision of M.J.RAMAKRISHNA M.J.RAMAKRISHNA , Assistant Professor, IPE, OU Campus,
Hyderabad AND Mr. Trivikaram , Marketing Head, Amaron batteries Pvt ltd.,
Hyderabad.
This project has not been submitted elsewhere for the award of any degree or diploma
either in part or full in any university/institution.
Place- Hyderabad M SRIKANTHREDDY
Date:
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ACKNOWLEDGEMENT
No task however small can be completed without proper guidance and encouragement. It
is a pleasure to acknowledge my debt to the many people involved directly or indirectly,
in the successful completion of the project.
I would like to acknowledge the help rendered to me by Prof. R.K.Mishra, Director,
IPE Hyderabad.
I would like to thank Dr.S.K.Mathur, Coordinator, PGDM-IB, IPE, Hyderabad, for
guidance and support throughout the course of this project.
I express my gratefulness to Mr. TRIVIKRAM, Regional Manager, Amaron Batteries
Ltd, Mr. NAIUDU for providing me with an opportunity to be associated with the
project.
I express my deep sense of gratitude to MR. M.J.RAMAKRISHNA MR. M.J.RAMAKRISHNA for her timely help
and integrity in handling my needs. I take this opportunity to thank her profusely for her
excellent guidance and support throughout the course of this project.
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Index
Contents: Page No’s
1. Industry overview 5
2. Company profile 14
3. Introduction to study 30
4. Data Analysis 35
5. Findings 46
6. Suggestions 47
7. Conclusion 48
8. Questionnaire 50
9. Bibliography 51
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1. INDUSTRYOVERVIEW
5
INDUSTRY PROFILE
Industry Overview:
The total Indian storage battery market is approximately estimated at US$ 500
Million with the automotive battery segment contributing 60 to 65 percent of the overall
market value. In terms of volumes, the overall consumption of automotive batteries could
be around 6.3 million units with the OE segment comprising around 1.2 to 1.3 million
units per annum, according to an interview with the Executive Vice President of ARBL
that was published on the website chennaibest.com. The late 1990s also saw a surge in
the sales of the passenger car segment for around 2 years due to certain factors like the
software boom, lowering of interest rates, etc. - which increased the overall sales of
batteries. The automotive sector did not see any significant growth during the early part
of the new millennium and is slowly showing signs of growth during this financial year.
This factor also adds to the demand in the aftermarket as more number of cars was sold
around 2 to 3 years back which is generally the life of a lead acid battery. The
replacement automotive battery market is expected to grow at a healthy rate in the
coming years.
The SLI market in the Indian subcontinent is a highly fragmented industry with a
few manufacturers in the organized segment and a lot many belonging to the tier 2 / tier 3
categories which have a regional presence and thrive especially among the semi urban
and rural areas.
Role of Technology
With the advent of newer more advanced technologies, the consumer is getting
the best of both worlds; a superior product at an affordable price. ARBL sells its
automotive battery under the brand name Amaron which is the country's first Zero
Maintenance Free Automotive battery while the competitors had only maintenance free
batteries that needed topping up of distilled water. Today, all the leading manufacturers
are also offering a similar product with focus shifting towards offering a technologically
superior product. Amaron was also the first to talk about what goes into making a great
product. It spoke of having silver inside which is used as an alloy mix that actually
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increases the battery life and this was the first attempt by any battery manufacturer to
educate the consumers.
Fuddy Duddy Category to Creative Advertisement of the Year
The interest level shown by any car owner to a battery revolves around only when
the car fails to start. Amaron therefore realized the need to make the consumer think
about automotive batteries, because thinking before a purchase will definitely lead to a
comparison among the brands available in the market.
Amaron thus went ahead with its "Chicken Leg" media campaign that created a
storm in the advertising industry and made people look to this relatively new player in the
battery industry. Over the years, the creative bent of all its campaigns starting from the
media blitz, to below-the-line campaigns have been towards educating the consumer
about a battery.
The lead shown by ARBL was quickly followed by the others, with Exide
Industries sponsoring a cricket series in India for the first time with the campaign "India
moves on Exide" becoming a major success.
All this action in the automotive battery industry did not go unnoticed. An
automotive battery manufacturer (Amaron) for the first time was in the same league as
mega ad spenders like Coca Cola, Times of India, and others and won the Creative
Advertiser of the Year, which was a shot in the arm for the entire automotive battery
industry.
Distribution
For the success of any aftermarket product, availability of the same is as
important as the product quality and competitive pricing which go a long way in
increasing the visibility and creating a network across markets. Here again, the leading
automotive battery manufacturers became aggressive in extending their reach to the
nooks and corners of the country and also moved away from the traditional distribution
network and instead appointed dealers and distributors who were the first timers to the
battery business like service outlets of some of the automobile majors like Maruti,
Power Source won the distinguished alumnus award from the International Management
Institute (IMI) which is given in recognition of dedicated and meritorious service to
business and society above and beyond expectations of expertise in the workspace.
HIGHLIGHTS:
Amaron TM is the preferred supplier to Daimler Chrysler, Ford and General
Motors
Automotive product of the year 2000 by overdrive
Excellence in Environmental management in 2002 by AP Pollution Control Board
Creative Advertiser of the year ’02 by ABBY
Ford “World Excellence Award”
Ford Q1 Award
ISO - 9001 in 1997….RWTUV
QS 9000 in 1999….RWTUV
ISO/TS 16949 in 2004….RWTUV
Quality benchmarks
Best business practices as per JCI
ISO 14001 in 2002…..RWTUV
Part of the world’s largest battery manufacturing alliance- Johnson Controls Inc.,
USA
Largest manufacturer of standby VRLA batteries for industrial application in
India
Auto CAD for sheet metal design
Largest & dominant market leader of standby batteries in Railways, Telecom,
power generating stations in India
One of the largest (designed for producing 2.5 million batteries p.a) and most
modern automotive battery plants in Asia
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Highly automated (oxide preparation to finishing; all processes and operations are
automated)
Part of Amara Raja’s highly integrated battery complex (most components are
built in-house)
Industrial Economist Business Excellence Award – 1991 by the Industrial
Economist, Chennai.
Best Entrepreneur of the year 1998 – by Hyderabad Management Association.
Excellence award by Institution of Economic Studies (ES), New Delhi.
Udyog Rattan – 1999 by Institution of Economic Studies (ES), New Delhi
Q1 vendor status by Ford India Limited – 2003
World Excellence Silver Award by Ford USA
The spirit of Excellence by Academy of fine arts, Tirupathi
Future growth and prospectus:
The company has plans of expanding its battery manufacturing capacity a robust
50% from 3.6 million units per annum to 5.4 million units per annum. The company
intends to make an investment of Rs 882 million for the expansion.
The company plans to expand the capacity of the industrial battery division,
which would incur a capital expenditure of Rs 650 million. The company would be
investing Rs 1,134 million in setting up a facility at Tirupati for the manufacture of two
wheeler and small VRLA batteries. The proposed Share valueinvestment would be spread
over three years. The capacity’s facility would increase to 5.74 million units Share value.
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3.INTRODUCTION
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INTRODUCTION TO STUDY
Problem definition:
To find out the factors that influence the customers to buy Amaron two wheeler batteries
and also to find the market potential of Amaron two wheeler batteries in Hyderabad.
Scope of the study:
The scope of the study can be defined in terms of the area and the sample size which will
be reviewed for satisfying the objective of the subject matter. The scope of study is in
Hyderabad, and around 50 Battery retailers and OEMS was targeted for the door to door
survey which was done through questionnaire.
Objective:
A study on factors influencing purchasing decision of the customers and identifies the
reason for better sales of Amaron batteries and examines option for enhancement.
Limitation of the study:
1) This study is limited to only Hyderabad.
2) Sample size is only 50. As sample size is very small it might not give the exact fig
or may not be the exact representative of the actual population.
3) Respondents are not very much cooperative and some time biased answer so
understatement and overstatement observed
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RESEARCH METHODOLOGY
Research is scientific & systematic search pertinent information on a specific topic the
meaning of research is a careful investigation (or) inquiry especially through search for
new facts in any branch of knowledge.
Data sources:
One of the important tools for conducting research is the availability of necessary
and useful data collection is more of an art that science. The source of information fall
under two categories.
1. Primary data:
Primary data is collected with the help of questions, which consisted of questions of closed ended. The questionnaires are chosen because of its simplicity and reliability. Researchers can expect a straight answer, which is directly related to the questions asked. Interpretation of data under this can also be done correctly. It helps the responded to understand the significance and answer to their ratability. In this method response rate and reliability is high. In addition to this the data is collected through observation, questionnaire method and personal interview.
2. Secondary data:
Secondary data is collected through the document provided in internet by
the company, manuals and reports regarding financials etc., and books.
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3. Sampling:
It is necessary to collect data from the retailers and OEMS in the market. A small
represents sample may serve the purpose. A sample means group taken from a large lot.
This small group should be imitative cross section and really representative in character.
This selection process is called sampling.
4. Sampling Size:
Sample is device for learning about masses by observing a few individuals ,the selected sample is 50.
4. Collecting and analyzing data :Data collection is usually done by trained interviewers who are employed by field
data collection companies to collect primary data. A choice has to be made between collecting the data yourself or hiring an external office who are specialized in interviews.
Data analysis is needed to give the raw data any meaning. The first step in analyzing the data is cleaning the data. This is the process of checking the raw data to verify that the data has been correctly entered into the files from the data collection form. After that the data have to be coded. This is the process of assigning all response categories a numerical value. For example males = 1, females = 2. After that the data can be tabulated, which refers to the actual counting of the number of observations that fall in to each possible response category
5. Tools of analysis:
The collected data was first codified. Classified and then crystalised into tables
which are further elucidated by dint and by pie chats. The conventional statistical
techniques used in this survey are the percentage analysis and the graphical
representation. Percentage analysis has been used as the main tool and graphs are helpful
to analysis and interpret the data. Suggestions and recommendations were made at the
end of the report
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4. DATA ANALYSIS
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Data analysis:
1. Are you dealing with any two-wheeler batteries?
S.NO Response No of respondents
Percentage
1 Yes 50 100
2 No 0 0
Total 50 100
Interpretation:
From the above graph that it can be stated that 100 percent of retailers are dealing with two wheeler batteries.
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4. Price of the battery is the main factor which attracts the customer?
INTERPRETATION:
The above graph depicts the opinion of the retailers, from the above graph we can say that in sample of 5o, exactly half of them agree that price is one of the factors which attracts the customer, 25 % of them are neutral, and only 4 of them disagree that price is not a factor which really attracts a customer .so from the graph we can conclude that price is one of the key factor which plays a vital role in customer mind while purchasing a two-wheeler battery.
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3. Warranty period of the battery is the main factor which attracts the customer?
INTERPRETATION:
From the above graph we can say that, from the sample of 5o, 28 members strongly agree that warranty period is the main factor which attracts the customer,18 members agree that it is also one of the factor which customer perceives while buying a battery, and only 4 of them disagree .from the above data we can conclude that while comparing both price and warranty period warranty period is the factor which scores more over price while purchasing.
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4. Free maintenance of the battery is the main factor which attracts the customer?
Free maintenance of the battery means that battery does not require continuous monitoring after it is fit in to the vehicle. For example Amaron batteries are embedded with a latest technology called VRLA , the significance of the technology is that, the battery does not require any external sourcing( like water ) once it is fit in to the vehicle.
INTERPRETATION:
From the above graph, it shows that, out of the 50, 32 members strongly agree that free maintenance of the battery is the main factor which customer is attracted to, 12 members agree ,4 members are neutral i.e the cant decide and only 2 members disagree with the statement.
From the given data we can conclude that customers are biased with the latest technology , it stresses on the fact of continuous up gradation of the technology a company must strive for, to able to sustain in the market .
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5. Customers are aware of the brands available in the market?
INTERPRETATION:
From the above graph we can say that, out of sample 50 exactly half i.e. 25 of them agree that customer are aware of the different brands available in the market, seven of them are neutral & eight of them feel that customers are not aware of the brands available in the market
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6. The first choice of the customer is Amaron?
INTERPRETATION:
From the above graph we can say that, out of sample 50, 25 members disagree with the statement that Amaron is the first choice of the customer, 14 members agree with the statement, 5 members are neutral, 3 members strongly agree & 3 members strongly disagree.
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7. The distribution chain of the Amaron batteries is good?
INTERPRETATION:
From the above graph , we can say that there is mixed response from the participants exactly 20 of them agree that distribution chain of Amaron is good & 20 of them disagree,
5 members are neutral, 3 members strongly agree,& 2 members strongly disagree with this.
The Amaron follows a different kind of distribution chain which is unique from its competitors, they follow franchise method i.e. they allow their products to flow in the market through franchises, the company does not have direct link up with the retailers, so distribution chain of Amaron batteries is different in different markets, which clearly depicts in the data shown in the graph i.e. retailers in some areas agree that Amaron has got good distribution network, while in some areas they feel it should improve & the response is exactly same in number.
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8. The replacement of fault batteries is quick in case of Amaron?
Replacement of fault batteries here means that , how quick the company (franchise) responds in replacing the fault battery with a new battery within a specified warranty period.
INTERPRETATION:
From the above graph we can say the out of the sample 50 exactly 25 of them disagree with the statement that replacement of the fault batteries is quick in case of Amaron , 13 of them agree, 5 of them strongly disagree & 4 of them are neutral.
As we see from the graph majority of the respondents feel that the replacement of the fault batteries is a concern with Amaron . Again this points out the effective functioning of the franchise in a area . Amaron two-wheeler batteries have a 60 month warranty period which is quite a long period compared to its competitors. While collecting the data from the retailers they complained us about giving high warranty period , some of the
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retailers also felt that they refrain from suggesting a customer a Amaron battery because of high warranty period.
9. Which brand has the highest sales record in the recent past?
Interpretation:
From the above graph we can say that out of the sample 50 , 20 respondents feel that Exide has got the highest sales in the recent past , 13 members feel that Amaron is leading in the sales, 7 members are up for Amco , 3 members for SF, 7 members are for other batteries.
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10. You have sufficient stock of Amaron two wheeler battries?
Sufficent stock of Amaron batteries :
Interpretation:
From the above graph we can say that the out of 50 samples 19 peoplestrongly feel that there is no stock of amaron batteries ,6 people said that they said they are not having the stock ,4
retailers are Neutral and 10 people said that they are having sufficient stock of batteries.
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5. FINDINGS1. The first preference of most of the customer is Exide.
3. The retailers are not satisfied with the time taken for replacement of Amaron two wheeler batteries.
4. The warranty period of the Amaron batteries is very high when compared to other brands available in the market. I found that warranty period is very important in Amaron battery sales.
5. To keep up the motivation & also to make the retailers loyal to the brand, company should initiate to give some incentives & promotional offers to retailers.
6. Free maintenance of the battery/the technology (VRLA) which is used in the Amaron batteries is the most competitive factor of the brand.
7. In our survey, we found that many of the OEMs & also some of the retailers are not aware of the Amaron two-wheeler battery.
8. Although the technology (VRLA) of Amaron two wheeler batteries is of highest quality, some retailers complained to us that few batteries are prone to technical faults.
9. Some retailers complained that they not satisfied with the lead time.
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6. SUGGESTIONS
1) The present Warranty period ( 60 month) is very high , I found that retailers are reluctant to suggest the customer to buy Amaron as they are afraid they have to cater the needs of the customer for 5 years . so I suggest to lower the warranty period to match up with its competitors.
2) Although the company follows Franchise system, it should Maintain direct link ups with the retail owners. The company should also give some incentives to the retailers with the amount of sales they produced.
3) The company should get in to contracts with the Original Equipment Manufacturers.
4) I Observed that , now there is a huge demand of two-wheeler Batteries in the market , every company is falling short of supply , this is the right time to penetrate in to the market.
5) The company should modify their supply chain so as to reach the present days demand.
6) The most important suggestion for the Amaron company , it should take some initiatives in bringing awareness regarding the uniqueness of the Amaron two-wheeler battery , advertising should be increased.
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7.CONCLUSION
To conclude, the overall market share in Hyderabad with regard to Amaron two-wheeler batteries is pretty average , there is a lot of scope to increase its market share, although it has been only for year since it is in the market , it is not reached the position to where it has to be( keeping in mind the brand image Amaron). Although technically , regarding warranty period, the price it is on par with its competitors , the area where it lacks is in bringing awareness among the consumers , the company should take immediate initiation in advertising the product , so as to create awareness among customers, another area of setback to Amaron two wheeler battery is that the company doesn’t have any tie-ups with the original Equipment manufacturing dealers , while talking to the retailers , majority of them opined that , most of the customer insist to have their new battery with same brand that of the old one, this tells us the importance of tie-ups with the OEMs .
The distribution of Amaron two-wheeler battery is different, the company doesn’t have direct link-ups with retail market , each area is segmented and given to franchises , in our research we found mixed responses regarding this distribution chain , the other side who complained us, their main problem is that , there is no set policies for these franchises, the even run retail i.e. they even sell the product directly to the customer , where he gets lesser price than what he might got at the retailer, retailers are unhappy with this.
Most important of all is that, during my research i found that there is a lot of shortage of two wheeler batteries in market at present, lot of retailers complained about time delay in supplying the orders, i think this is the right time for new entrant like Amaron to capture the market , they should make their supply chain effective so as to reach the future demands of market.
SA = Strongly Agree, A = Agree, N = Neutral, D = Disagree, SD = Strongly Disagree
SA A N D SD
4) Price of the battery is the main factor which attracts the customer
5) Warranty period of the battery is the main factor which attracts the customer
6) Free maintenance of the battery is the main factor which attracts the customer7) The distribution chain of Amaron batteries is good8) Customers are aware of the brands available in the market9) The first choice of the customer is Amaron10) The sales of Amaron has increased compared to past11) The replacement of fault batteries is quick in case of Amaron.12) you have sufficient stock of the brand Amaron .
13)can u suggest, how Amaron could improve to serve you better?
Ans:
50
9. BIBILOGRAPHY
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LIST OF BOOKS
1. MALHOTRA, NARESH K., 2008, Marketing Research, Pearson Prentice
Hall, New Delhi.
2. KOTLER PHILIP & KELLER KEVIN, 2003. Marketing Management, New