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Metal products Indialimited
By :- Ashok RanaChurchill MishraChandan Kumar Kuldeep Katiyar
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Case Overview MPIL was setup for improving the
distribution in South MPIL lost its market share North
Karnataka MPIL was solely dependent on
Bangalore Metal Trader for
distribution New entrants operated with the sub
dealers of MPIL
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Metal Products IndiaLimited (MPIL) Established in 1987 at the out skirts
of Bangalore. Set up by parent company Madhya
Bharat Metal Sections Limited(MBMS) in Bhilai
Manufacturers of mild steel mostly
used in construction, furniture, rollingshutters and industrial sheds.
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Metal Industry
Complete market size was of 40,000metric tones (MT)
Annual growth rate of 6 percent Major Players
Karnataka Metal Sections (KMS) Adarsh Metals (AM) Mahavir Metal Sections (MMS)
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Comparison with others On the basis of product quality On basis of pricing & discounting On the basis of distribution &
availability On the basis of brand name &
reputation of the company
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Characteristics Of Environment Previously MPIL was market leader
in south India environment was favorable for MPIL Business was quite attractive Later on new entrant increased the
competition
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Distribution Channel of MPIL
Distribution through existing dealersof MBMS
Appointed new dealers atVijayawada, Calicut and Erode
MPIL decided prices for its dealers Manufacturer gave discount of 3% to
7% depending on volume Dealers further marked up the prices
by 7% to 8%
Direct dealing with OEMs and
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Market Structure Bangalore Metal Traders (BMT) was
largest dealer in South India with off take of 2000 MT per annum
BMT had more than 50% of marketshare in Karnataka
Transactional Relationship/Mutual
Understanding MPIL didnt appoint dealers at other
centers in Karnataka BMT didnt dealt with other
manufacturers
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Market Structure Cont Karnataka Metal Sections (KMS)
operated Bangalore market throughKavery Agency
More than 80% of market was shared by MPIL & KMS
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Apparent Problem Loosing sub dealers in north
Karnataka Loss in market share Strategies adopted by competitors i.e.
new entrants Discount rate for the sub dealers Distribution network
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Recommendation MPIL should not solely depend on
BMT MPIL should promote their product
through hardware to capture themarket of north Karnataka
Restructuring of discount in interest
of sub dealers Applying condition to deal only with
MPIL products
Assigning of new dealer in differentareas of south India
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Problems With SuggestedRecommendation
Might loose the some business withBMT
Cant offer high margin as AM andMMS
Time constraint in appointing newsub dealers
Cost involved in stud in market b
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