1 TRAINING REPORT ON SALES STRATEGIES OF AQUAGUARD Submitted to MAHARSHI DAYANAND UNIVERSITY, ROHTAK In Partial Fulfilment of Requirement for the award of the degree of MASTER OF BUSINESS ADMINISTRATION (INDUSTRY INTEGRATED) (4th Semester) Submitted by, NAME: Kailash Somnathe Regn. NO. : 1073901744 Roll No.: 1090210491 GURU GRAM BUSINESS SCHOOL ELC Code : 151012055 Plot No 74, Unnati Park, Besa, Nagpur, Maharashtra AUGUST 2012
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KAILASH SOMNATHE 4th Sem Training Report on eureka forbes ltd
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1
TRAINING REPORT ON
SALES STRATEGIES OF AQUAGUARD
Submitted to
MAHARSHI DAYANAND UNIVERSITY, ROHTAK
In Partial Fulfilment of Requirement for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
(INDUSTRY INTEGRATED)
(4th Semester)
Submitted by,
NAME: Kailash Somnathe
Regn. NO. : 1073901744
Roll No.: 1090210491
GURU GRAM BUSINESS SCHOOL
ELC Code : 151012055
Plot No 74, Unnati Park, Besa, Nagpur, Maharashtra
AUGUST 2012
2
TITLES PAGE NO.
TITLE PAGE 1
INDEX 2
CERTIFICATE 3
DECLARATION 4
ACKNOWLEDGEMENT 5
CONTENTS 6
3
This is to certify that Mr. Kailash Somnathe, a student of the Maharshi
Dayanand University , Rohtak , has prepared his Project Report entitled “
Sales strategies of Aquaguard ” , at Guru Gram Business School , under my
guidance . He has fulfilled all requirements leading to award of the degree of
MBA ( Industry Integrated ) . This report is the record of bonafide training
undertaken by him and no part of it has been submitted to any other
University or Educational Institution for award of any other degree or simillar
titles or prizes.
I wish him all success in life.
Mr. Ajay Patole
Program Coordinator
Guru Gram Business School
4
I hereby declare that Training Report Conducted at
EUREKA FORBES LTD., NAGPUR
Under the guidance of
Mr. AJAY PATOLE
Submitted in partial fulfilment of the requirements for the
Degree of
MASTER OF BUSINESS ADMINISTRATION
(Industry Integrated)
TO
MAHARSHI DAYANAND UNIVERSITY, ROHTAK
is my original work and the same has not been submitted for the award of any
other Degree /diploma /fellowship or other simillar titles or prizes.
Place: _________
Date: _________
Mr. KAILASH SOMNATHE
Regn.No.1073901744
Roll no. :1090210491
5
This is to certify that MR. KAILASH SOMNATHE who is pursuing MBA (industry
integrated) course of Maharshi Dayanand University , Rohtak , at Guru Gram Business
school Nagpur has undergone management training at our organization from 1 Jan 2012
His performance during training period was found to be excellence
We wish him success for his future endeavors.
Anil Dhunde
Incharge manager
6
I have taken efforts in this project. However, it would not have been possible
without the kind support and help of many individuals and organizations. I would like
to extend my sincere thanks to all of them.
I am highly indebted to NIAM training’s officer for their guidance and
constant supervision as well as for providing necessary information regarding the
project & also for their support in completing the project.
I would like to express my gratitude towards my parents & member of GURU
GRAM BUSINESS SCHOOL NAGPUR for their kind co-operation and
encouragement which help me in completion of this project.
I would like to express my special gratitude to Mr. Ajay Patole and thanks to
industry persons for giving me such attention and time.
My thanks and appreciations also go to my colleague in developing the project
and people who have willingly helped me out with their abilities.
7
CHAPTER
NO.
CONTENTS SUB CONTENTS PAG
E
NO
1. INTRODUCTIO
N
1.1 GENERAL INTRODUCTION
OF SECTOR
10
1.2 INDUST
RY
PROFIL
E
ORIGINE AND
DEVELOPEMENT
16
GROWTH AND
PRESENT STATUS
15
FUTURE OF
INDUSTRY
18
2. PROFILE OF
THE
ORGANIZATIO
N
2.1 Origin of the organization 24
2.2 Growth developement 22
2.3 Present status 24
2.4 Functional department 26
2.5
ORGANIZATION
STRUCTURE AND CHART
35
8
2.6
PRODUCT PROFILE
36
2.7
MARKET PROFILE
44
3. Discussions on
Training
3.1 Student work profile 46
3.2 Key learning
47
4 STUDY OF
SELECTED
RESEARCH
PROBLEM
4.1 Statement of research problem 48
4.2 Statement of research objectives 49
4.3 Research design and
methodology
50
5 ANALYSIS 5.1 Analysis of data 51
5.2 Summary of finding 52
6 SUMMARY
AND
CONCLUSION
6.1 Summary of learning experience 53
6.2 Conclusion and recommendation 53
7 APPENDICES
8 BIBLIOGRAPY 54
9
LIST OF GRAPHS AND CHARTS
Sr.
No.
Graph
No.
Graph Title Page No.
1
2
3
4
5
6
1
2
3
4
5
6
TOP PLAYER
MARKET LEADER
PORTER’S ANALYSIS MODEL
ORGANIZATION STRUCTURE
DISTRIBUTION STRUCTURE
MARKET SHARE
11
12
13
35
45
44
10
CHAPTER- 1
INTRODUCTION
11
GENERAL INTRODUCTION ABOUT FMCD SECTOR
The Consumer Durables industry consists of durable goods and appliances for domestic
use such as televisions, refrigerators, air conditioners and washing machines. Instruments
such as kitchen appliances (microwave ovens, grinders etc) are also included in this
category. This industry includes all those goods which are durable i.e. products whose
life expectancy is at least 3 years. These products are hard goods that cannot be used up
at once. According to recent industry reports, the steadily growing market for consumer
durables is estimated at Rs. 300 billion.
Segmentation of the Consumer Durables Industry: The consumer durables industry
can be broadly classified into 2 segments: Consumer Electronics and Consumer
Appliances. Consumer Appliances can be further categorized into Brown Goods and
White Goods. The key product lines under each segment are as follows:
What does the Past Say?Here’s the review..
12
Titan, the market leader in watches and branded jewelry, has clocked the highest Net
Sales CAGR of 34% over the last 6 years. It has the competitive advantage of a strong
brand, which has helped it become the market leader. Using the right segmentation
& smart branding strategies, Titan has successfully captured the watch and jewelry
market. It has also managed to maintain a good Net Profit Margin of 6%
TTK Prestige, the market leader in pressure cookers and kitchen solutions, has
registered the highest CAGR of 74% in Net Profit over a 6-year period.
Porter’s Analysis:
13
What are the growth drivers for this sector? Here’s the analysis…
1) Rise in Disposable Income:
The demand for consumer durables has been rising with the increase in disposable
income coupled with more and more consumers falling under the double income
families. Also, the growing Indian middle-class plays a major role in increasing the
demand. This, along with a fall in the prices of durable goods mainly due to the
14
advancement of technology, easy import of components has led to an increase in the
consumption expenditure on durable goods.
2) Easy-availability of consumer financing:
Apart from steady growth in income of consumers, consumer financing has become a
major driver in the consumer durables industry. In the case of more expensive consumer
goods, such as refrigerators, washing machines, color televisions and personal
computers, retailers are marketing their goods more aggressively by providing easy
financing options to the consumers by partnering with banks. The easy-availability of
consumer financing is beneficial mainly for the lower and middle income group,
especially when the cost of capital and flexibility of the scheme is in their favor.
3) Existing Potential in Rural Markets:
Growth is coming in a big way from the smaller towns and rural markets and is expected
to be the next growth opportunity for the consumer durables market. In the last year ~30-
35% of the total sales of consumer durables was from the rural market. This is expected
to grow by 40-45% in the near future. The rural durables market has been growing by
~30% annually, mainly due to the growing affordability of products as well as the
general buoyancy in the economy. Products like mobile phones, televisions and music
systems are the ones which have witnessed high growth among the rural market. To
further cater to this market many manufacturers have started using local languages while
offering products to the rural crowd.
4) Increasing share of Organised Retail:
Since the last couple of years there has been an increasing shift towards organized retail
(brands) from the unorganized (unbranded) products. With rising income and purchasing
power, and the younger generation preferring branded products, the share of organized
shopping is increasing. Shopping in malls is considered more of an experience these
days. According to estimates, organized retail which constituted ~4% of the total buying
till 2010, is expected to grow to over 10% by 2013.
5) Entertainment and Media to boost growth:
According to a recent report by KPMG, the Indian Media & Entertainment (M&E)
industry registered a growth of 11% over 2009 and touched Rs. 652 bn and is expected to
achieve a 13% growth in 2011. Overall the industry is expected to register a CAGR of
15
14% to touch Rs.1275 bn by 2015. Out of this, the television industry is expected to
achieve a 16% CAGR and is expected to account for almost half of the Indian M&E
industry revenues. The television segment of the consumer durables industry is seeing
high growth coming from high-end flat panel TV, LCD TVs and Plasma TVs. All of
these were expected to register a 100%+ growth in the last year. Hence, the growing
importance of entertainment and media on our lifestyles is expected to boost the demand
for products like Plasma TVs , LCDs, DVD Players.
16
INDUSTRY PROFILE INDUSTRY OF WATER PURIFIER IN INDIAN
MARKET
ONE man's meat is another's poison can well be said in the context of the bottled water
controversy. Even as the ripples seem far from receding on whether the pesticide-residue in
packaged drinking water is a reason for concern — the water-purifier industry has lost no
time in sniffing out an opportunity.
"Water from Waterguard is completely safe from harmful pesticides, bacteria, viruses and is
economical too!", says an advertisement from Usha Shriram, advertising for its Usha Brita
Water Purification Systems. And in case you miss the point, the advertisement has in its
background copies of media reports on `Pesticides in bottled water.' Meanwhile, Eureka
Forbes, touted to be the leader in the water purification
segment, reacted more swiftly to the pesticide-issue and came out with "reassuring"
advertisements, within a couple of days after the Centre for Science and Environment (CSE)
came out with its controversial report.
The Ministry of Food Processing Industries held an inter-ministerial meeting on the issue, to
"take stock and decide on the future course of action." The Union Health Ministry too had
met discuss the subject and according to sources; the inclination was towards aligning with
the European Union (EU) norms. However, the Bureau of Indian Standards reiterated its
stand on the issue and said: "That it took into consideration the limits set by the USFDA, the
EU, the World Health Organization (WHO), Codex etc. and decided that since bottled water
was a value-added product and in keeping the public/consumer interest, the (BIS) committee
unanimously decided to quantify the maximum limits for pesticide residue and made the
necessary amendments to the two Indian standards".
17
The different companies which manufacture water purifier are:
Aqua Guard
Kent grand,
Hindustan uni lever –pure it,
Philips intelligent,
Whirlpool Pure Fresh,
Jaipan, Alpha Dewdrop,
Eurotek System,
GenPure R.O System,
Bionics
Aqua Tech
Kenstar water purifier,
Krona,
Astro-boy-water purifier,
Euro Fabs,
Euro riva water purifier,
Aqua fresh water purifier.
The two major products of Eureka Forbes:-
1. Eureka Forbes Water Purifiers
2. Eureka Forbes Vacuum Cleaners
Eureka Forbes Water Purifiers:-
Eureka Forbes have all over 20 water purifiers ranging from Rs.2,000 to Rs.25,000. Their
range of products treats the water with varying levels of technology. The main difference is
18
that the expensive systems like the Integra Hi-Life have larger water production capacity per
hour, more water storage capacity, and use the Reverse Osmosis Technology (RO) to treat the
water.
Market Segmentation:-
Market segmentation can be conducted using a number of approaches including
demographic, geographic, attitudinal, psychographic, and behavioural.
Geographic Variables:-
Regional: Eureka Forbes has branches in almost all the metropolitan cities and it is available
almost all over the country.
Population density:- It is targeted to Urban, Suburban and rural area in India.
Demographic Segmentation:-
Age: Eureka is targeted to different age groups like young and middle and old age group as
water is a necessity for all age groups.
Gender: Eureka Forbes is targeted to both male and female.
Income: Targeted to middle and high income groups of people.
Occupation: It is targeted to all groups of occupation.
Religion: It is targeted to all kind of religious people.
Psychographic segmentation:-
Lifestyle ± different people have different lifestyle patterns and our behavior may change as
we pass through different stages of life. Water Filter belongs to a better people with better
lifestyle, hygiene and health conscious people.
Behavioral segmentation:-
Benefits sought :Eureka Forbes water has created an better image to the consumers through
its quality and better service
19
Product usage: Eureka Forbes service is open to all type of customers.
Targeting:-
Eureka Forbes in India has carved a niche as the leading company for water purifiers. RO is
one of the most effective processes of purifying water with high TDS content. Eureka Forbes
is setting up alternative and new retail channels to increase the penetration of water
purification devices. Eureka Forbes have a range of non power using products under the
Aqua sure brand which we are promoting through the new channels set up by the retail
division. The purpose is to target 60 million households in urban and rural residential areas
which have never used water purifiers.
Positioning:-
Eureka Forbes has positioned itself as a cost effective, customer centric organization
servicing the market need for purified water. It will leverage its competitive edge to achieve
the desired positioning. Its competitive advantage is the ability to generate revenue streams
for sellers of the product; this is virtue of network marketing system.
20
CHAPTER 2
PROFILE OF
ORGANIZATION
21
EUREKA FORBES LIMITED
In 1999, Eureka Forbes Ltd. (Eureka Forbes), the leading vacuum cleaner and water/air
purifier equipment company, announced a major policy change that came as a surprise to the
Indian corporate world. The company, regarded as the pioneer of direct marketing in India,
was planning to focus more on the retailing business in the future. Commenting on this
decision, S Goklaney, Managing Director, Eureka Forbes, said, "Direct sales permits us to
exploit only the top end of the market.“
This move was in accordance with the company's plans to increase the visibility of its
products. The company planned to make its products available in retail outlets through its
dealer network, spread across 2,600 dealers. With this move, Eureka Forbes also planned to
increase the sales revenue generated by the retail division. Eureka Forbes' Senior Vice-
President, Sales and Marketing, Palekar, explained, "While the dealer channel contributes
10% to the overall sales turnover of the company, the direct sales route contributes 75%.“
The same year, in another major departure from the business practices adopted since it
began business in India, Eureka Forbes announced its decision to enter the bottled water
market. The company wanted to position itself as a one-stop shop for products related to
providing pure water. Industry watchers questioned this decision, observing that most
manufacturers of bottled water were regional players and very few brands had an all-India
presence. Parle's Bisleri mineral water brand, the only national level player at that point of
time, was expected to pose stiff competition to Eureka Forbes.
The fact that these developments came at a time when the partners in the Eureka Forbes
joint venture, Forbes Gokak Ltd. (FGL) and Electrolux AB (Electrolux), were engaged in a
bitter boardroom battle, added to the air of uncertainty surrounding the company. The tiff had
started in early 1999, when Electrolux announced its decision to walk out of the direct sales
business world over and, consequently, sell off its 40% stake in Eureka Forbes.
Company observers stated that Eureka Forbes could find it difficult to succeed in the retail
business without Electrolux's financial support and marketing expertise. The decisions to
shift from direct selling to retailing and to enter the bottled water segment were being eyed
22
with suspicion by analysts. Commenting on these decisions, analysts said that since Eureka
Forbes was a relatively new player in the retail business and did not have much experience, it
could have a tough future ahead.
• Background note
Fred Wardell, a well-known businessman of Detroit, Michigan, launched vacuum cleaners
under the Eureka brand name in 1909. Eureka's vacuum cleaners were sleek, versatile and
lightweight, while most of the vacuum cleaners manufactured those days were clumsy and
difficult to use. Within a few years, the company became well-known for its innovative
product range. In 1913, Eureka launched vacuum cleaners in six different models and offered
various add-ons for cleaning floors (bare/carpeted), walls, upholstery, and crevices. The
company adopted the direct
marketing route from the very beginning and its sales personnel delivered personalized
services to customers.
As vacuum cleaners became increasingly popular in the early 1900s, Eureka employed
around 5000 salesmen and opened over 400 branches to cater to growing customer demand.
Within a decade, Eureka had established itself as the market leader in the Vacuum Cleaner
industry. The company acquired reputation for high quality products and excellent
customer/dealer relations. In 1915, Eureka received the highest award for vacuum cleaners in
those days, the `Grand Prize', by a jury of electrical experts at the San Francisco International
Exposition.
By 1919, Eureka was manufacturing around 2,000 vacuum cleaners per day at its factory
(spread over 3.5 acres in downtown Detroit). Over the next decade, the company went on to
become the number one vacuum cleaner company in the US. By 1927, the company
manufactured one-third of all vacuum cleaners purchased in the US. During World War II,
Eureka had to stop production and its business suffered to a great extent for a couple of years.
In 1945, the company moved its headquarters from Detroit to Bloomington, Illinois.
During the same year, it merged with leading heating and air-conditioning equipment
manufacturer, Williams Oil-O-Matic Heating Company, and was renamed as Eureka-
Williams. Over the next few years, the company diversified into the manufacture of oil
burners and government defense equipment. In 1960, Eureka-Williams merged with
electronic goods manufacturer National Union Electric. The company even manufactured a
23
battery-operated automobile named Henney Kilowatt. But it did not stay long in all these
businesses and soon decided to focus only on its original business of manufacturing vacuum
cleaners and various other home appliances.
In 1974, Electrolux1 of Sweden, the world's largest producer of home appliances, purchased
Eureka-Williams and changed its name back to Eureka. Electrolux expanded Eureka's
manufacturing base manifold by opening factories at various places in USA. In 1974, a
manufacturing and warehousing facility was opened in Normal, Illinois (closed down later
on). In 1981, a manufacturing plant for the production of parts (of vacuum cleaners) was
opened in Juarez, Mexico and another was opened in El Paso in 1983, which was later
expanded in 1997. The El Paso unit was the world's largest vacuum cleaner manufacturing
facility.
Electrolux brought the Eureka brand to India in 1981 through Eureka Forbes, a joint venture
with FGL. While Electrolux held 40% of the stake, the rest 60% was held by FGL. FGL was
a 60:40 joint venture between the construction major ShapoorjiPallonji Group and one of
India's largest business houses, the Tata Group of companies. Eureka Forbes launched its first
range of vacuum cleaners, `Euroclean', in 1982, and established its direct sales division in the
same year. The company's subsidiary for manufacturing water purifiers, Aquamall Water
Solutions Ltd., was also established in 1982.
The company began operations from a single office in Delhi, with just 10 field
representatives. Two years later, it launched the Aquaguard range of water purifiers. As
business started picking up, Eureka Forbes established its dealer sales division in 1985, its
industrial sales division in 1986, and its exports division in 1989. During the mid-1990s, the
company diversified into products like mixers and irons. However, as the quality of these
products was reportedly very poor, Eureka Forbes had to discontinue them. In 1994, the
company entered the air purifiers segment. In 1995, Eureka Forbes launched the `Tornado'
range of vacuum cleaners and the `Aquaflo' range of water purifiers, exclusively for
marketing through the dealer route.
In 1997, Eureka Forbes diversified into electronic security solutions under the brand name
`Eurovigil'. The company established manufacturing facilities at Bhimtal (Uttar Pradesh, now
Uttaranchal), Hyderabad (Andhra Pradesh) and Banglore (Karnataka). Eureka Forbes also
had a Research and Development center at Bangalore.
24
Eureka Forbes - Starting from scratch
HISTORY
The Eureka Forbes story began twenty six years ago when it gained the first mover
advantage by capitalizing on a market opportunity it spotted way ahead of its time.
Traditional water purification methods such as alum straining and boiling were unable to
handle the wide spectrum of new water contaminants. Aqua guard was the first home water
purifier system to be introduced in India to combat this emerging monster. There were many
skeptics who predicted that the product was doomed to fail as there was no perceptible
market need for it. The company found in direct selling an important ally and a perfect
solution. By creating a dynamic sales team – aptly christened Euro champs – Eureka Forbes
was able to create a market where none existed by breaking down resistance. The Euro
champ mentored, installed and serviced the product and won the trust of the family. In the
comfort of people’s homes he was able to demonstrate and place irrefutable evidence that the
eye often deceived. With the residential front falling to Eureka Forbes it was only a matter of
time before corporate India realized that better employee health, fostered by a clean work
environment translated into an exponential increase in productivity and efficiency.
To provide support to this view Eureka Forbes created a dedicated arm – the Eureka
Forbes Corporate Care Division – to service this need. In the meanwhile the retail market
continued to grow, providing it with efficient service became a Eureka Forbes priority. The
company’s Consumer Division helped it to consolidate its position in the retail market by
introducing a product range for both the upper as well as the lower end of the market. Eureka
Forbes also added franchised direct operations to augment its reach and tap the vast potential
in smaller towns. Forbes Facility Services and Forbes Concept Hospitality Services were set-
up to provide institutional customers with complete outsourcing facilities. Water-borne
diseases are not just an India centric phenomenon. Large parts of the world suffer from this
deficiency. Eureka Forbes was quick to seize the opportunity. It made its debut in the
international arena with Forbes Lux – a joint venture with Lux AG, the world leader in direct
selling. This joint venture now reaches customers in over 39 countries.
Eureka Forbes followed the globally `tried and tested' direct selling route for marketing its
products in India, thus becoming one of the first direct selling companies in India. Vacuum
25
cleaners and water purifiers were rather new concepts for Indian consumers, who had till then
followed only the traditional methods of cleaning and filtering. Therefore, Eureka Forbes had
to first establish the concept of vacuum cleaners and water purifiers in India before it could
sell `Eureka' as a brand. The company believed that its core strength was its people. It
employed dynamic, highly motivated individuals, called `Eurochamps', who projected the
image of `The friendly man from Eureka Forbes'. Thus, for the average Indian consumer,
Eureka Forbes became synonymous with the smartly dressed salesman who came to their
houses and cleaned up things in a jiffy or showed how air/water purifiers were indispensable.
Eurochamps initially targeted the metros but soon began visiting smaller cities and towns
also.
Though the company posted profits initially, it suffered a setback in 1992-93, when
profits declined by 50% in comparison to the previous year. The following year, the company
even had to post its first-ever loss of Rs. 42.5 mn. However, gradually the company's
products gained acceptance in Indian markets and company sales picked up. The company
began advertising across various media primarily to familiarize its target segment,
housewives, with its products and introduce it to its salesforce. These advertisements showed
helpful salespersons who solved the problems of housewives. Television commercials
typically featured models who appeared `friendly' and trustworthy. The company also used
actors from popular Hindi TV serials, such as NitishBhardwaj and Amar Upadhyay, to
enhance the friendly and trustworthy image of its salespersons.
The company's direct marketing thrust did not end with the conversion of orders into
sales. Eureka Forbes started a customer care network that took care of after-sales services
offered by the company. The company's customer service network comprised over 400 CRC
(Customer Response Centers), covering over 98 towns with more than 4000 sales personnel
working under it. These centers offered a plethora of options to its customers in order to
enhance their satisfaction with their purchases. Some of these options were:
An `Annual Maintenance Contract', which the customer could enter into after the warranty
period was over. ‡
Free maintenance for its equipment at medical establishments on a yearly basis²This
scheme was called `Operation Red Zone'.
A mobile service van facility for New Delhi and Mumbai customers.
26
`Water Labs' for customers who wanted to reassure themselves about the quality of water
purified by Aquaguard. Representatives from these labs visited customer premises, collected
water samples, and provided test reports to the concerned customer. This service was
available in Mumbai, New Delhi, Kolkata Chennai, Bangalore and Ahmedabad.
The `Euroclean home contest' gave owners of Euroclean vacuum cleaners the opportunity
to entertain celebrities in their homes, on the basis of a cleanliness contest conducted by the
company. The `Gift a Smile' scheme was introduced to encourage sales personnel to keep in
constant touch with the customers.
In an attempt to forge closer ties with its customers and push its new products, Eureka
Forbes launched a scheme that gave existing customers the option of getting a new water
purifier against their old model at a discounted price.
Customers in New Delhi, Chennai and Bangalore could access the central CRC round-the-
clock. Service call-back was guaranteed within 48 hours, since most service personnel were
accessible through pagers.
The company believed that `A relationship does not end with a sale. It actually begins.'
Eureka Forbes gave a lot of importance to Customer Relationship Management (CRM) and
tried to maintain high level of post-sale customer contact. As after-sales service formed a
crucial element of its marketing mix, the company set up a 24 hour-365 day virtual call
center. The call center's software built into it tracked a complaint back to the nearest sales
office or franchisee on the basis of the complainant's telephone number or PIN code. Updat
27
FUTURE PROSPECTS OF EUREKA FORBES
Commenting on the decision to diversify into bottled water, company sources said that it
was only to strengthen the core products by capitalizing on their brand image. Goklaney said,
"In the water category, I will conduct activities which strengthen my core products. How I do
that and what I do is a matter of strategy." According to company sources, Eureka Forbes not
only had the financial strength, but also a strong network of sales executives to push its new
products into the market.
The company's decision to enter the retail business was primarily the result of its launch of
`Tornado' vacuum cleaners and `Aquaflo' water purifiers in 1995. Eureka Forbes had utilized
the retail route for this range, mainly to cater to the industrial segment. Over the years, the
retail business assumed greater significance and by 1999, around 5% of the company's sales
came from the 2500-strong dealer network. Eureka Forbes saw a lot of potential in the retail
business and thus decided to work towards expanding its dealer network further and double
its revenues from this segment. In 2001, the dealer market was growing at the rate of 25%
annually, and the company expected its dealer network to grow further by 25% by the end of
2002.
In 2001, with a customer base of 3 million, Eureka Forbes sales turnover stood at Rs. 3.68
bn, 32% of which came from vacuum cleaners and 45% from water purifiers. By 2002, the
company was the undisputed market leader in the vacuum cleaner segment with 75% market
share and water purifier segment with 85% market share. It was the market leader in the air
purification and electronic security solutions segments as well. Meanwhile, in April 2002,
after a long period of negotiations, FGL signed a deal to buyout Eureka Forbes from
Electrolux for Rs. 317.7 mn. FGL agreed to pay an annual royalty to Electrolux to use the
Eureka Forbes brand name. However, the two partners could not reach an agreement over the
issues of brand rights transfer. Since, as per the joint venture agreement, Electrolux owned
the Eureka, Aquaguard, EuroClean and EuroAir brands, it was necessary that the two parties
agreed over the use of these brands in future by Eureka Forbes. However, the matter
remained unresolved in July 2002. Refuting allegations that Electrolux's departure would
have any kind of negative impact on its performance, company sources pointed out that the
Swedish partner never had management control of the company, and that its inputs were only
28
in the form of technology transfer. And even on the technology front, Eureka Forbes did not
seem to be worried. Palekar said, "Technology is a non-issue. It used to be a competitive
advantage 15 years ago, but not today. In fact, with research and development costs
escalating and product lives becoming shorter, everybody in the consumer durables business
licenses out technology today."
Over the years many players had entered the segments Eureka Forbes was operating in3 ,
but none of them had been able to make a significant impact. That the `going was strong'
despite the upheavals it was going through, indicated that direct marketing or retail, with or
without Electrolux, Eureka Forbes planned to retain its distinction of being the largest direct
sales organization in Asi
COMPANY’S VISION
A happy healthy safe & pollution free environment built with trust and lasting relationship
with customers
Company’s vision (sales)...
Vision I: T o be the no.1 water purifier brand in dealer trade
Vision II: To be recognized as one of the finest marketing organization for
trade management.
29
COMPANY’S MISSION
To build sustainable relationship with customers as their ‘Friends for life’ by satisfying
their evolving health hygiene safety and lifestyle through
‘Our people’
Through entrepreneurial spirit and ambition is fuelled by a culture of pride, learning, earning
and fun.
‘Our products’ and ‘Services’
That reflect innovation, become quality benchmarks, and provide real value for money.
‘Our policy’ and ‘Practices’
Which are fair, transparent and constantly improved to maximise stakeholders satisfaction
and achieve market leadership.
COMPANY’S VALUES
CUSTOMER is the centre of our business. Integrity and highest ethical standards, mutual
respect and trust is our working relationships.
Communication that is open and two ways.
Diversity of people, cultures and ideas, innovation and encouragement to challenge the
status quo, continuous improvement, development and learning in all that we do. Teamwork
and meeting our commitments to one another performance with recognition for results.
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COMPANY PROFILE
We are ‘Your friends for life,’ we are Eureka Forbes!
It dates back to 1982, when health ambassadors from Eureka Forbes, with a
new concept of living in a clean environment and drinking water in its purest form
knocked on your door. They called themselves friends for life and they proved that
they indeed were. Eureka Forbes continues to be the best friend in Indian Households
even after two decades and the sentiments have not changed.
Eureka Forbes is a part of the Shapoorji Pallonji Group and today it is a 12 billion
INR, multi product and multi channel corporation. Incepted in 1982, we have put 28
years of consolidated efforts to become the undisputed leaders in domestic and
industrial Water Purification Systems, Vacuum Cleaners, Air Purifiers & Security
Solutions. Being Asia’s largest direct sales organization, our force of 7000 direct
personnel touches 8 million homes. We have one of the largest networks catering to
more than 131 cities and 398 towns across the country. We also have a 10,000 strong
dealer sales network and over 58 distributor strong Industrial Sales Network.
Dedicated to the cause of providing healthier living, today we have successfully
established ourselves as a business super-brand and our dedicated team works around
the clock to make your lives healthier and more secure. We strive to provide the best
after sales service, and to achieve the same we have over 1500 service centers and as
many as 4500 company trained technicians who visit over 20,000 Indian kitchens
daily!
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COMPANY HEADINGS
Rs. 10 billion multi-product, multi-channel corporation - part of the Shapoorji Pallonji
Group.
Over 7,000 employees.
Leaders in domestic and industrial Water Purification Systems, Vacuum Cleaners,
Air Purifiers & Security.
Pioneers in Direct selling - Asia's Largest Direct Sales Organisation.
A strong service network that backs up sales efforts, Supported by Call Centre,
Customer Care Representatives & Mobile Service Vans and 24 hour helpline for
customers - Eurohelpline .
Eureka Forbes - A Business Superbrand .
Aquaguard & Euroclean - Chosen Superbrands.
Ranked among India's Most Admired Consumer Durable Companies.
Best Employers (3 times in a row).
Winner of 'Most Admired Knowledge Enterprise' MAKE- Asia Awards.
A case study at the prestigious Harvard Business School.
Winner of awards on Customer Responsiveness.
Winner of Water Digest awards.
Customer has always been the centre of their business.
They are in close and constant touch with their customers, listening to them and
understanding their needs .
They have created exciting new products and services to satisfy customers’ needs.
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A sale is only the beginning of a relationship - they make a special effort to let the
bonds of friendship endure through service, post purchase training and a host of other
customer care incentives.
Operates in over 92 cities in India.
Employs over 6000 individuals.
1st to introduce domestic water purifier and vacuum cleaner in 1980.
Innovated direct selling.
Asia’s largest direct selling organisation 1500 customers added daily.
Effective marketing and training of employees and stakeholders on goods, services
and company objectives.
Eureka Forbes Business Policies:-
The customer is the sole focus of our business.
We constantly Endeavour towards customer satisfaction by delivering products and
services of the best value and quality.
We strive to honor our commitments, implied to both internal and external customers.
We stress on integrity, transparency and consistency in all our dealings.
We always strive to have a trusting, mutually beneficial and long-lasting relationships
with our business associates.
We seek to maintain a warm, positive and friendly work.
We empower our people at appropriate level to achieve their g
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ACHIEVEMENTS
Eureka Forbes has received many prestigious accolades since its inception - be it in
relation to our products, our people practices or our social responsibility. We continue to
make our mark in each of these fields thanks to the continuous support of our untiring people,
fondly called Eurochamps; our ever supportive customers, our associates and our partners.
This drives us to continuously strive to outdo ourselves as a company and reinstate our
position as friends for life. forever.
Our efforts have borne us fruits in the form of the numerous awards that
we have received from time to time:
Winner of 6 prestigious UNESCO Water Digest Awards 2009-10.
Winner of the Frost & Sullivan Award for the Best Company from the domestic point
of use, Water treatment systems and Customer Service Leadership Award.
We have been ranked amongst India's Most Admired Consumer Durable Companies.
Awarded Best Employers 4 times in a row.
Winner of 'Most Admired Knowledge Enterprise' MAKE- Asia Awards.
Holds the distinction of presenting a case study at the prestigious Harvard Business
School.
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Eureka Forbes Limited awarded for Customer Responsiveness
Eureka Forbes Limited has been awarded the The Economic Times - Avaya Global Connect AwardDrd, for
excellence in Customer Responsive Policies and Practices.
Avaya Global Connect Limited is a leading enterprise and a dominant player in the contact centre market. Their belief
in customer responsiveness as the new competence for companies wanting to stay ahead, paved way for The
Economic Times - Avaya Global Connect Customer Responsiveness Awards, 2005.
The participating companies were judged under many parameters like innovation, responsiveness, customer
education, etc. Companies across various categories including Automobiles, IT and Consumer Durables competed
against each other. Five nominees were short-listed from each category and a customer poll helped select a final
winner. Eureka Forbes Limited emerged as a winner in the Consumer Durables Category after receiving an
overwhelming number of votes online and through printed forms.