Description
The Videocon group's core areas of business are consumer electronics and home appliances. They have recently diversified into areas such as DTH, power, oil exploration and telecommunication.
PROJECT REPORT ON INDUSTRIAL EXPOSURE
VIDEOCON TABLE OF CONTENTS
Page No. ? Executive Summary …………………………………….. 1 ? Objective & Scope of Study……………………………… 2
? Chapter – 1
Introduction…………………….. 3 – 21
1.1 Overview of the Company 1.2 Company Profile 1.3 History of Videocon 1.4 Why Logo Changed 1.5 Vision & Mission 1.6 Ambition & Technologies
? Chapter – 2
Products………………………. 22 - 33
2.1 Competitors 2.2 Comparison with other Companies 2.3 Distribution Channel in the Industry
? Chapter – 3 ? Chapter – 4 ? Chapter – 5
SWOT Analyses……………….. 34 - 36 Recommendations……………… 37 - 38 Learning………………………... 39 - 40
? Bibliography………………………………………………… 41
EXECUTIVE SUMMARY
The Indian consumer durables industry has witnessed a considerable change in the past couple of years. Changing lifestyle, higher disposable income coupled with greater affordability and a surge in advertising has been instrumental in bringing about a sea change in the consumer behavior pattern. This industry consists of durable goods used for domestic purposes such as televisions, washing machines, refrigerators, microwave ovens, mobile phones etc. The growth in the consumer durables sector has been driven primarily by factors such as the boom in the real estate & housing industry, higher disposable income, emergence of the retail industry in a big way coupled with rising affluence levels of a considerable section of the population. As per a survey conducted by FICCI on the Indian consumer durables industry, a shift in consumer preferences towards higher-end, technologically advanced branded products has been quite discernable.
1
OBJECTIVES & SCOPE
Objective:
?
To study the ELECTRONIC industry
? To study the marketing strategies
Scope:
? The project will help the other industry to known about their competitive edge ? Advertisement will encourage to buy its products .
2
Chapter - 1 Introduction
3
1.1 Overview of the Company
The Late Shri. Nandlal Madhavlal Dhoot Founder, The Videocon Group (26 February 1932 - 26 April 1993)
Videocon Industries Ltd. was one of the initials companies that made it to the World. Videocon Electricals captured the initial Indian Electrical market and topped the charts for its products such as Refrigerators, television etc. before other players such as Samsung, Whirlpool etc .entered Indian market. Videocon was one of the first Electronic Company to Collaborate with Japanese Toshiba Ltd as early as 1985
4
2.2 Company Profile
The Videocon group emerges as a USD 2.5 Billion global conglomerate continuing to set trends in every sphere of its activities from a conference room sized assembly line in 1979.
Today the group operates through 4 key sectors: 1. Consumer durable 2. Thomson CPT 3. CRT glass 4. Oil and gas
5
Consumer Electronics, Home Appliances & Compressor manufacturing in India We enjoy a pre-eminent position in terms of sales and customer satisfaction in many of our consumer products like Color Televisions, Washing Machines, Air Conditioners, Refrigerators, Microwave ovens and many other home appliances, selling them through a Multi-Brand strategy with the largest sales and service network in India. Our compressor manufacturing technology in Bangalore further supports refrigerator manufacturing.
Display Industry and its components With the Thomson acquisition Videocon has emerged as one of the largest Color Picture tube manufacturers in the world operating in Mexico, Italy, Poland and China, continuing to lead through new innovative technologies like slim CPT, extra slim CPT and High Definition 16:9 formats CPT.
6
Color Picture Tube Glass Videocon is one of the largest CPT Glass manufacturers in the world with a high level of experience and technical expertise operating through Poland and India. Videocon will leverage on this synergy after the Thomson acquisition to internally source glass for its CPT manufacturing increasing efficiencies and lowering costs.
Oil and Gas An important asset for the group is its Ravva oil field with one of the lowest operating costs in the world producing 50,000 barrels of oil per day. The group has ambitious plans for expansion in this
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8
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1.3 History of Videocon
A Man of ideas, Man of substance, man of vision, Shri Nandlal Madhavlal Dhoot, the founder of the Videocon group, completed his education in Ahmednagar, Pune and in Maharashtra, India. A successful sugarcane and cotton grower, he boldly ventured forth and imported machinery from Europe, setting up the Gangapur Sakhar Karkhana (Sugar Mill) in 1955, at a time when the village had no electricity, thereby unleashing an industrial revolution. The die was cast. Over the years, Nandlalji's pioneering spirit found expression in a myriad ways, earning him the well-deserved reputation of the doyen of industrial activity in Marathwada, India. In early 80s, Nandlalji initiated his three sons - Venugopal, Rajkumar and Pradeep into the business. Through a technical tie-up with Toshiba Corporation of Japan, he launched India's first world -class Color Television: Videocon. Today, Videocon is a household name across the nation - India's No.1 brand of Consumer Electronics and Home Appliances, trusted by over 50 million people to improve their quality of life.
10
Corporate Overview
The Videocon Group is committed to create a better quality of life for people and furthering the interests of society, by being a responsible corporate citizen. Creating Happiness
We will bring happiness into every home, offering high quality consumer durables at affordable prices, spreading the culture of convenience, entertainment and comfort, far and wide. Achieving Progress We will pursue innovative technologies in the fields of Electronics and Energy, create products and services that will improve the quality of life, realize the goals of the world community and protect the environment.
Sustaining Growth
We will be a source of pride to our business associates by ensuring mutual prosperity and growth through the implementation of forward-looking corporate strategies, aimed at identifying opportunities and responding intelligently to the dynamics of change.
11
Pursuing Excellence
We will provide a conducive environment for enabling our employees to develop their potential and make a significant contribution to the Group's success. In 1985, through a technical tie-up with Toshiba Corporation of Japan, Videocon International Limited launched India's first world class Color Television. Today, Videocon International Ltd., the flagship company of the Videocon Group, is India's leading manufacturer of Consumer Electronic products. Fired by a passion for innovation, Videocon has kept pace with the changing face of technology, constantly upgrading its manufacturing facilities to incorporate advanced technology and high standards of quality into its product range, right across the spectrum.
12
1.4 WHY LOGO CHANGED
Videocon’s new logo pushes ‘change’ The Videocon Group has embarked upon a massive rebranding exercise in order to position itself as a ‘younger, fresher, eco-friendly and a ‘with-it’ brand. The new ‘V’ is a more fluid version of the erstwhile logo and comprises two green lava-like shapes. “To communicate the brand’s new identity, we decided to give life to the two parts of the logo”. The two animated characters have been named ‘Chouw’ and ‘Mouw’.
13
1.5 Vision & Mission
Videocon’s mission: a reflection of continuity and change Videocon’s mission expression has been crafted to envelope both extant and emerging realities: “To delight and deliver beyond expectation through ingenious strategy, intrepid entrepreneurship, improved technology, innovative products, insightful marketing and inspired thinking about the future.” A breakdown of the statement above reveals a ‘means and end’ approach, where the end is articulated at the beginning with the means linked to it. “To delight and deliver beyond expectation…” the end This segment not only underlines the importance of the ultimate goal - customer satisfaction (‘delight’) and ultimate target - the customer, but also of intermediate processes and principals, which have contributed to building a robust, dependable Videocon value chain (‘deliver’). As a result of its focus on developing loyal customers and reliable associates, Videocon is able to exceed expectations. “…through ingenious strategy…” the means In the cutthroat world of today, it is only by taking recourse to advance planning and strategy that a business can hope to survive. Although textbook strategy has its uses, reproducing it in verbatim for the real world would be foolish because of the absence of textbook conditions. Thus, there is a need for a bounded rationality, spontaneity and improvisation that is flexible enough for scenarios both imaginable and unimaginable.
14
Videocon’s ingenious maneuvers are actually flexi-strategy that abstracts from shifting ground conditions and decides game-plans, or sometimes changes the rules of the game. “…intrepid entrepreneurship…” the means An enterprise with the odds stacked against it makes great business sense. This is because higher the obstacles lower the number of players likely to be active in that field - thus, fetching extraordinary returns. The only requirement is a bold and confident attitude willing to brave the odds. Videocon’s foray into oil and gas is a bold and intrepid Endeavour that arises from immense faith on the surefooted competence of the company’s in-house managerial talent. “…improved technology…” the means Technology is no more a premium input; it has become the bare minimum in recent years. Rapid advances have only fuelled this phenomenon. Videocon is extremely vigilant in shunting out dated technology and replacing it with the best-in-class offers of the times. “…innovative products…” the means Product development, innovation and customization are the tools Videocon uses to stay ahead of the competition. This is because a continuous stream of innovative products excites the market and enhances brand recall. A strategy that Videocon banks on a lot, especially on the domestic front.
15
“…insightful marketing…” the means The market share battle scene has long shifted from technology and processes to the psyche of the customer. This means that those with deeper insights into the elusive mind of the buyer are likely to dominate. Videocon is reinforcing marketing strengths to read better the pulse of the market and help create products that map perfectly into customer preferences.
“…inspired thinking about the future.” the means The future is unpredictable, but not doing anything about it is fraught with grave risk. Videocon extrapolates future trends on the basis of current changes in technology and preferences as well as sheer gut feel. Fine-tuned business instincts are worth their weight in gold, lots of it. The company has perfected its practice almost into an art form with some calculated gambles like oil and gas proving to be absolute money-spinners.
1.6 Ambitions & Technologies
Technology with a Heart 16
Committed to giving the consumer the best the world has to offer, Videocon has developed near zero wastage technology which helps reduce manufacturing costs by optimizing material inputs. Coupled with quality-consciousness at every stage, the consumer benefits enormously by getting premium products at affordable prices. The company currently manufactures Color TVs, Black & White TVs and Audio products. At its modern plant at Chitegaon and Aurangabad, the Company has also undertaken complete backward integration to manufacture all critical and important components of its products, such as Electronic Tuners, FBTs, ATDMs and Deflection Yokes, thereby reducing costs, ensuring quality control and becoming vertically integrated. It has set up a unit at Gandhinagar in Gujarat for manufacturing Black & White TV picture Tubes.
The Sound of Excellence Videocon produces a sophisticated range of Home Audio Systems, Stereo Radio, Recorders and Personal Stereos, as well as the contemporary international range of Kenwood Digital Hi Fi Systems.
First with the Best Continuous up gradation and indigenous manufacturing has been and continues to be an integral part of the company's philosophy. Perceived as an innovator in its field,
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Videocon has notched up many exciting firsts, by exploring the world's most advanced technologies. In Color TVs, Videocon was the first Indian Company to introduce PictureIn-Picture, Turbo Sound, Surround Sound, Larger Screen Sizes, the Full Flat Square Tube, Bazooka technology and the Freedom series: affordable high quality range of Color TVs for the price-conscious consumer. Global Ambition Looking beyond India, Videocon is now a global player, acknowledged by the world. It is the first Indian company to win the prestigious CE approval for exporting its Color TV to Europe. Videocon is now entering world market with its operations in the Middle East, Europe, Indonesia and South Africa. Videocon Narmada Glass (VNG): a division of Videocon International Ltd., has the distinction of having set up India's first plant for the manufacture of Glass Shells for Color Television Picture Tubes, in technical collaboration with Techneglas Inc., USA (formerly known as OI-NEG TV Products Inc., USA), world leader in Glass Shell Technology. The projects in 1990, when the then Prime Minister of India, the late Shri Rajiv Gandhi, laid the foundation stone for the project. The Videocon Group, with the objective of backward integration, joined hands with Gujarat Narmada Valley Fertilizers Co. Ltd., (GNFC) for the implementation of this 100% import substitution project, the largest investment (Rs. 450 cores) in electronic component industry in the country. The plant, with an installed annual capacity of 1.7 million Glass Shells for Color Picture Tubes and 0.25 million glass Bulbs for Black & white Picture Tubes and Monochrome Monitor Tubes, is located at Village Chavai, District Bharuch, and Gujarat.
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SUCCESS STORIES The Heights of Success VNG has some remarkable achievements to its credit, starting with the successful absorption of sophisticated technology from Techneglas Inc., USA. The CTV Glass Shells manufactured by VNG are at par with international standards and the Color Picture Tubes made with VNG glass have already received VDE approval. The facilities include a state-of-the-art Tool Room and Mould Shop to manufacture and maintain its mould requirements. Having initially successfully established its 20V, 19V and 13V CTV glass parts, VNG has now developed the 20V 2R the latest models. A Picture Perfect Future Till 1994, Indian manufacturers of CTV Picture Tubes were importing Glass Shells. VNG's production has replaced these imports, thereby saving almost Rs.200 crores of precious foreign exchange every year. VNG has now surpassed the norms of performance guaranteed by the collaborator, Techneglas Inc., U.S.A. and is operating the plant with 150% capacity utilization - with efficiencies exceeding international standards. Where fields of sugarcane grow tall and proud. Where bushes of cotton bud blooms. Where tourists flock to the world-famous caves of Ajanta and Ellora. Where India's NO.1 Consumer Electronics and Home Appliances take shape, to take millions of Indians into a better, brighter future.
This is Marathwada, India, where the Dhoot family launched Videocon International Limited in 1984, with the avowed purpose of producing world-class Color Television through a technical tie-up with Toshiba Corporation of Japan. Within a decade, Videocon
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emerged as India's leading brand of both Color and Black & White Televisions and continues to dominate this highly competitive market. The leader innovates. The leader forges ahead. The leader breaks new ground. Harnessing the advanced technology, relentlessly pursuing quality to achieve various international standards of Quality Control. Breaking through, time and again, with innovative products for a better life. VISIONARY VIDEOCON Profiles of Leadership Futuristic Neuro Fuzzy Logic Washing Machines, User-friendly - No-Frost Refrigerators, the very latest music systems. The most sophisticated Color Television and VCRs. HighTech Air-conditioners. Videocon today, is a multi-faceted group, with 9 state -of-the-art manufacturing facilities all over India. Highly qualified engineers, trained in Japan, backed by 6500 technical and support staff, work together in close unison to produce India's leading branch of consumer electronic products and home appliances. Leadership through People Videocon lays great emphasis on the training and development of its work force, providing every opportunity for growth and advancement, including training stints overseas.
LANDMARKS FROM ELECTRONICS TO ENERGY The Heart of Nation
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1995 was a landmark year for Videocon. It clearly reaffirmed its leadership in Color TVs, Black & White TVs, VCRs and VCPs, Washing Machines as well as No-Frost Refrigerators. Then Videocon began to reach out to the core. To industries at the heart of a nation: Petroleum, Power, Construction and Housing. Leading India into the future, with Confidence, with determination, with a commitment to excellence, rooted in the pioneering vision of a path breaker.
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Chapter - 2 Products
22
23
24
Videocon Mobiles:
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1.1 Competitors
1. LG, Samsung: This strategic group includes the South Korean MNCs. These are the players who are operating only in the frost-free segment and carry a large product length. They have products only in the above 300 Ltrs segment. These brands follow the Premium strategy of high quality at high price. They are targeting to the upper income as well as the higher middle class of the society with the products that are associated with status. These companies have shown a tremendous growth in few years. 2. BPL, Whirlpool: BPL, the market leader in the Frost-free segment and Whirlpool of India, the subsidiary company of the US giant Whirlpool form this group. They have frost-free models in the below 300 Ltrs capacity segments as well as the above 300 Ltrs segment. The models in above 300 Ltrs segment cater to the replacement market and to the higher middle class. These aim at providing high quality at a moderate price. The models in the below 300 Ltrs are targeted at the first time buyers of middle class and are not high in price. 3. Godrej: These are the old brands of India, which have high brand awareness and presence in urban as well as the rural Markets. These are mainly serving to the Direct cool segment and have few models in the frost-free segment. These brands are catering to the middle class and are not very high in prices. 4. Videocon: This is the company, which introduced Frost-free refrigerators in India. The products are value for money products. With the lowest prices in the market it is catering to the middle class of the society.
26
5. Voltas: These companies cater to the middle and lower middle class of buyers with their low priced ranges.
The companies in the market witness a tough competition from the other members of its strategic group as they fight for the same chunk of the market. As their products do not differ much in the features, they try to differentiate their brands through copy differentiation in advertising. The competition intensifies as most of the companies are using the same dealer network to distribute their products. They lure the dealers to promote their product by different strategies on margins, incentives and credit and payment terms. The competition increases as all the companies have high Strategic stakes in the Refrigerator Business. A major fraction of their revenues come from this business and so they retaliate sharply to any move of the competitor. The industry has high Exit Barriers for the members who have invested in the manufacturing facilities in India in the form of specialized assets.
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1.2 Comparison with Other Companies
REFRIGERATOR INDUSTRY AT A GLANCE ? Refrigerators are being manufactured in India for the last four decades. ? Till early nineties only direct cool refrigerators were used in India. ? Videocon introduced frost-free refrigerators in 1991. ? In 2005-06 the market was as follows:
1 0.8 0.6 0.4 0.2 0 Price
% Mkt. Share
Direct Cooling
Direct Cooling Frost Free
Segment Direct Cooling Frost Free
Price % Market Share Low 85% 35-40% more than DC 15%
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COMPANIES IN THE REFRIGERATOR MARKET
The leading companies in the market with their market share in first half.
TOTAL MARKET BRAND VIDEOCON Sales (Units) 199000 21000 SAMSUNG LG GODREJ BPL WHIRLPOOL ELECTROLUX OTHERS TOTAL 396000 25000 349000 8000 178000 25000 85000 83000 10000 7000 8000 8000 313000 1535000 180000
FROSTFREE SEGMENT % Share 12.9% 12% 25.7% 14.3% 22.7% 4.6% 11.5% 13.8% 5.5% 7.4% 0.7% 4.0% 0.5% 4.6% 20.3% 100% 100%
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1.3 Distribution Channels in the Industry
The Refrigerator companies in the industry use different distribution channels to reach the customer. These are as follows:
1. In this type of channel the company uses its sales representatives to deal with the dealers directly. The dealers place the order through the sales representatives who visit them periodically, and the products are delivered directly from the company. Some companies appoint Direct Dealers who act as their Franchisee Outlets or their Exclusive showrooms.
30
BPL uses this channel
2. In this channel of distribution the company appoints distributors on the basis of District/ Population /No of Dealers to be handled by one distributor. The area of operation and its potential is also taken into consideration. Some of the companies make the distributor totally responsible from appointing the dealers to providing after sales service.
31
Godrej use this channel
3. In this channel of distribution the company appoints Distributors as well as Direct Dealers. The company appoints distributors to deal with small dealers who order small quantities. With the dealers who have good potential and sales the company deals directly. Videocon and Samsung use this channel: The Korean Multinational follow this channel where they appoint Distributors for upcountry towns and direct dealers for big cities and major towns eg. Ahmedabad.
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4.
In this channel the company appoints a C&F agent who acts on behalf of the company. The C&F agent is totally responsible for appointment of Distributors and Direct Dealers. He sells to both the Distributors and the Direct Dealers at the same rates.
Strategic group mapping of industry players:
33
Chapter - 3 SWOT Analysis
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Strengths:
1. Videocon has largest distributed capacity manufacturing base across India with 17 Facilities and plant in china, Poland, Italy, Mexico. 2. Manufacturing capacity is 1, 40000 units. 3. Tie up with the Matsushita electric company of Japan add to the goodwill of Videocon. 4. Customers are aware about Videocon’s products. 5. Company has good brand name. 6. Strong backward integration 7. Videocon has largest distribution manufacturing based across in India. 8. Large brand basket 9. Multi brand strategy 10. 3rd largest picture tube manufacture in India Cheap price.
Weaknesses:
1. Less investment on advertisement of Videocon CTV 2. Fewer margins to the distributor/dealer. 3. Weak promotional strategy of CTV. 4. Not providing good service. 5. No exclusive show rooms
35
Opportunities:
1. Videocon takes over the Electrolux. 2. Videocon buys Thomson color picture tube manufacturing plant. 3. Videocon international is going global. 4. Videocon exploring whole new segment
Threats:
1. Brand loyalty is more of LG &other company. 2. A new competitor in your home market. 3. Increased trade barrier. 4. Brand reputation is not good. 5. Competition in global CPT market especially from integrated players such as LG, Phillips, Samsung, and Matsushita is intense.
36
Chapter - 4 Recommendations & Suggestions
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? Freezer should be small ? No crystal, grill shelf should be there ? No MRP is written. So MRP should be written ? Date of manufacturing is not written ? Model change should be there constantly ? Double door refrigerator should be provided. ? In today’s world of competition, the company should pay more attention towards: ? Best sales service • • • • • • • Displays In festivals we do promotions 0% finance Exchange offer High incentives 0% interest Carry back scheme
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Chapter - 5 Learning
39
It was a great opportunity to carry a study on such a reputed organization, which give me a good learning experience and knowledge about the products and industries. Another very crucial area that needs to be mention is the experience I gained while talking to and interacting with people. This has been actually enriching experience because interacting with people with varied projects helped me in enhancing my communication skills.
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BIBLIOGRAPHY
? www.videocon.com ? www.yahoo.com ? www.google.co.in ? www.aol.in
41
doc_534972683.doc
The Videocon group's core areas of business are consumer electronics and home appliances. They have recently diversified into areas such as DTH, power, oil exploration and telecommunication.
PROJECT REPORT ON INDUSTRIAL EXPOSURE
VIDEOCON TABLE OF CONTENTS
Page No. ? Executive Summary …………………………………….. 1 ? Objective & Scope of Study……………………………… 2
? Chapter – 1
Introduction…………………….. 3 – 21
1.1 Overview of the Company 1.2 Company Profile 1.3 History of Videocon 1.4 Why Logo Changed 1.5 Vision & Mission 1.6 Ambition & Technologies
? Chapter – 2
Products………………………. 22 - 33
2.1 Competitors 2.2 Comparison with other Companies 2.3 Distribution Channel in the Industry
? Chapter – 3 ? Chapter – 4 ? Chapter – 5
SWOT Analyses……………….. 34 - 36 Recommendations……………… 37 - 38 Learning………………………... 39 - 40
? Bibliography………………………………………………… 41
EXECUTIVE SUMMARY
The Indian consumer durables industry has witnessed a considerable change in the past couple of years. Changing lifestyle, higher disposable income coupled with greater affordability and a surge in advertising has been instrumental in bringing about a sea change in the consumer behavior pattern. This industry consists of durable goods used for domestic purposes such as televisions, washing machines, refrigerators, microwave ovens, mobile phones etc. The growth in the consumer durables sector has been driven primarily by factors such as the boom in the real estate & housing industry, higher disposable income, emergence of the retail industry in a big way coupled with rising affluence levels of a considerable section of the population. As per a survey conducted by FICCI on the Indian consumer durables industry, a shift in consumer preferences towards higher-end, technologically advanced branded products has been quite discernable.
1
OBJECTIVES & SCOPE
Objective:
?
To study the ELECTRONIC industry
? To study the marketing strategies
Scope:
? The project will help the other industry to known about their competitive edge ? Advertisement will encourage to buy its products .
2
Chapter - 1 Introduction
3
1.1 Overview of the Company
The Late Shri. Nandlal Madhavlal Dhoot Founder, The Videocon Group (26 February 1932 - 26 April 1993)
Videocon Industries Ltd. was one of the initials companies that made it to the World. Videocon Electricals captured the initial Indian Electrical market and topped the charts for its products such as Refrigerators, television etc. before other players such as Samsung, Whirlpool etc .entered Indian market. Videocon was one of the first Electronic Company to Collaborate with Japanese Toshiba Ltd as early as 1985
4
2.2 Company Profile
The Videocon group emerges as a USD 2.5 Billion global conglomerate continuing to set trends in every sphere of its activities from a conference room sized assembly line in 1979.
Today the group operates through 4 key sectors: 1. Consumer durable 2. Thomson CPT 3. CRT glass 4. Oil and gas
5
Consumer Electronics, Home Appliances & Compressor manufacturing in India We enjoy a pre-eminent position in terms of sales and customer satisfaction in many of our consumer products like Color Televisions, Washing Machines, Air Conditioners, Refrigerators, Microwave ovens and many other home appliances, selling them through a Multi-Brand strategy with the largest sales and service network in India. Our compressor manufacturing technology in Bangalore further supports refrigerator manufacturing.
Display Industry and its components With the Thomson acquisition Videocon has emerged as one of the largest Color Picture tube manufacturers in the world operating in Mexico, Italy, Poland and China, continuing to lead through new innovative technologies like slim CPT, extra slim CPT and High Definition 16:9 formats CPT.
6
Color Picture Tube Glass Videocon is one of the largest CPT Glass manufacturers in the world with a high level of experience and technical expertise operating through Poland and India. Videocon will leverage on this synergy after the Thomson acquisition to internally source glass for its CPT manufacturing increasing efficiencies and lowering costs.
Oil and Gas An important asset for the group is its Ravva oil field with one of the lowest operating costs in the world producing 50,000 barrels of oil per day. The group has ambitious plans for expansion in this
7
8
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1.3 History of Videocon
A Man of ideas, Man of substance, man of vision, Shri Nandlal Madhavlal Dhoot, the founder of the Videocon group, completed his education in Ahmednagar, Pune and in Maharashtra, India. A successful sugarcane and cotton grower, he boldly ventured forth and imported machinery from Europe, setting up the Gangapur Sakhar Karkhana (Sugar Mill) in 1955, at a time when the village had no electricity, thereby unleashing an industrial revolution. The die was cast. Over the years, Nandlalji's pioneering spirit found expression in a myriad ways, earning him the well-deserved reputation of the doyen of industrial activity in Marathwada, India. In early 80s, Nandlalji initiated his three sons - Venugopal, Rajkumar and Pradeep into the business. Through a technical tie-up with Toshiba Corporation of Japan, he launched India's first world -class Color Television: Videocon. Today, Videocon is a household name across the nation - India's No.1 brand of Consumer Electronics and Home Appliances, trusted by over 50 million people to improve their quality of life.
10
Corporate Overview
The Videocon Group is committed to create a better quality of life for people and furthering the interests of society, by being a responsible corporate citizen. Creating Happiness
We will bring happiness into every home, offering high quality consumer durables at affordable prices, spreading the culture of convenience, entertainment and comfort, far and wide. Achieving Progress We will pursue innovative technologies in the fields of Electronics and Energy, create products and services that will improve the quality of life, realize the goals of the world community and protect the environment.
Sustaining Growth
We will be a source of pride to our business associates by ensuring mutual prosperity and growth through the implementation of forward-looking corporate strategies, aimed at identifying opportunities and responding intelligently to the dynamics of change.
11
Pursuing Excellence
We will provide a conducive environment for enabling our employees to develop their potential and make a significant contribution to the Group's success. In 1985, through a technical tie-up with Toshiba Corporation of Japan, Videocon International Limited launched India's first world class Color Television. Today, Videocon International Ltd., the flagship company of the Videocon Group, is India's leading manufacturer of Consumer Electronic products. Fired by a passion for innovation, Videocon has kept pace with the changing face of technology, constantly upgrading its manufacturing facilities to incorporate advanced technology and high standards of quality into its product range, right across the spectrum.
12
1.4 WHY LOGO CHANGED
Videocon’s new logo pushes ‘change’ The Videocon Group has embarked upon a massive rebranding exercise in order to position itself as a ‘younger, fresher, eco-friendly and a ‘with-it’ brand. The new ‘V’ is a more fluid version of the erstwhile logo and comprises two green lava-like shapes. “To communicate the brand’s new identity, we decided to give life to the two parts of the logo”. The two animated characters have been named ‘Chouw’ and ‘Mouw’.
13
1.5 Vision & Mission
Videocon’s mission: a reflection of continuity and change Videocon’s mission expression has been crafted to envelope both extant and emerging realities: “To delight and deliver beyond expectation through ingenious strategy, intrepid entrepreneurship, improved technology, innovative products, insightful marketing and inspired thinking about the future.” A breakdown of the statement above reveals a ‘means and end’ approach, where the end is articulated at the beginning with the means linked to it. “To delight and deliver beyond expectation…” the end This segment not only underlines the importance of the ultimate goal - customer satisfaction (‘delight’) and ultimate target - the customer, but also of intermediate processes and principals, which have contributed to building a robust, dependable Videocon value chain (‘deliver’). As a result of its focus on developing loyal customers and reliable associates, Videocon is able to exceed expectations. “…through ingenious strategy…” the means In the cutthroat world of today, it is only by taking recourse to advance planning and strategy that a business can hope to survive. Although textbook strategy has its uses, reproducing it in verbatim for the real world would be foolish because of the absence of textbook conditions. Thus, there is a need for a bounded rationality, spontaneity and improvisation that is flexible enough for scenarios both imaginable and unimaginable.
14
Videocon’s ingenious maneuvers are actually flexi-strategy that abstracts from shifting ground conditions and decides game-plans, or sometimes changes the rules of the game. “…intrepid entrepreneurship…” the means An enterprise with the odds stacked against it makes great business sense. This is because higher the obstacles lower the number of players likely to be active in that field - thus, fetching extraordinary returns. The only requirement is a bold and confident attitude willing to brave the odds. Videocon’s foray into oil and gas is a bold and intrepid Endeavour that arises from immense faith on the surefooted competence of the company’s in-house managerial talent. “…improved technology…” the means Technology is no more a premium input; it has become the bare minimum in recent years. Rapid advances have only fuelled this phenomenon. Videocon is extremely vigilant in shunting out dated technology and replacing it with the best-in-class offers of the times. “…innovative products…” the means Product development, innovation and customization are the tools Videocon uses to stay ahead of the competition. This is because a continuous stream of innovative products excites the market and enhances brand recall. A strategy that Videocon banks on a lot, especially on the domestic front.
15
“…insightful marketing…” the means The market share battle scene has long shifted from technology and processes to the psyche of the customer. This means that those with deeper insights into the elusive mind of the buyer are likely to dominate. Videocon is reinforcing marketing strengths to read better the pulse of the market and help create products that map perfectly into customer preferences.
“…inspired thinking about the future.” the means The future is unpredictable, but not doing anything about it is fraught with grave risk. Videocon extrapolates future trends on the basis of current changes in technology and preferences as well as sheer gut feel. Fine-tuned business instincts are worth their weight in gold, lots of it. The company has perfected its practice almost into an art form with some calculated gambles like oil and gas proving to be absolute money-spinners.
1.6 Ambitions & Technologies
Technology with a Heart 16
Committed to giving the consumer the best the world has to offer, Videocon has developed near zero wastage technology which helps reduce manufacturing costs by optimizing material inputs. Coupled with quality-consciousness at every stage, the consumer benefits enormously by getting premium products at affordable prices. The company currently manufactures Color TVs, Black & White TVs and Audio products. At its modern plant at Chitegaon and Aurangabad, the Company has also undertaken complete backward integration to manufacture all critical and important components of its products, such as Electronic Tuners, FBTs, ATDMs and Deflection Yokes, thereby reducing costs, ensuring quality control and becoming vertically integrated. It has set up a unit at Gandhinagar in Gujarat for manufacturing Black & White TV picture Tubes.
The Sound of Excellence Videocon produces a sophisticated range of Home Audio Systems, Stereo Radio, Recorders and Personal Stereos, as well as the contemporary international range of Kenwood Digital Hi Fi Systems.
First with the Best Continuous up gradation and indigenous manufacturing has been and continues to be an integral part of the company's philosophy. Perceived as an innovator in its field,
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Videocon has notched up many exciting firsts, by exploring the world's most advanced technologies. In Color TVs, Videocon was the first Indian Company to introduce PictureIn-Picture, Turbo Sound, Surround Sound, Larger Screen Sizes, the Full Flat Square Tube, Bazooka technology and the Freedom series: affordable high quality range of Color TVs for the price-conscious consumer. Global Ambition Looking beyond India, Videocon is now a global player, acknowledged by the world. It is the first Indian company to win the prestigious CE approval for exporting its Color TV to Europe. Videocon is now entering world market with its operations in the Middle East, Europe, Indonesia and South Africa. Videocon Narmada Glass (VNG): a division of Videocon International Ltd., has the distinction of having set up India's first plant for the manufacture of Glass Shells for Color Television Picture Tubes, in technical collaboration with Techneglas Inc., USA (formerly known as OI-NEG TV Products Inc., USA), world leader in Glass Shell Technology. The projects in 1990, when the then Prime Minister of India, the late Shri Rajiv Gandhi, laid the foundation stone for the project. The Videocon Group, with the objective of backward integration, joined hands with Gujarat Narmada Valley Fertilizers Co. Ltd., (GNFC) for the implementation of this 100% import substitution project, the largest investment (Rs. 450 cores) in electronic component industry in the country. The plant, with an installed annual capacity of 1.7 million Glass Shells for Color Picture Tubes and 0.25 million glass Bulbs for Black & white Picture Tubes and Monochrome Monitor Tubes, is located at Village Chavai, District Bharuch, and Gujarat.
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SUCCESS STORIES The Heights of Success VNG has some remarkable achievements to its credit, starting with the successful absorption of sophisticated technology from Techneglas Inc., USA. The CTV Glass Shells manufactured by VNG are at par with international standards and the Color Picture Tubes made with VNG glass have already received VDE approval. The facilities include a state-of-the-art Tool Room and Mould Shop to manufacture and maintain its mould requirements. Having initially successfully established its 20V, 19V and 13V CTV glass parts, VNG has now developed the 20V 2R the latest models. A Picture Perfect Future Till 1994, Indian manufacturers of CTV Picture Tubes were importing Glass Shells. VNG's production has replaced these imports, thereby saving almost Rs.200 crores of precious foreign exchange every year. VNG has now surpassed the norms of performance guaranteed by the collaborator, Techneglas Inc., U.S.A. and is operating the plant with 150% capacity utilization - with efficiencies exceeding international standards. Where fields of sugarcane grow tall and proud. Where bushes of cotton bud blooms. Where tourists flock to the world-famous caves of Ajanta and Ellora. Where India's NO.1 Consumer Electronics and Home Appliances take shape, to take millions of Indians into a better, brighter future.
This is Marathwada, India, where the Dhoot family launched Videocon International Limited in 1984, with the avowed purpose of producing world-class Color Television through a technical tie-up with Toshiba Corporation of Japan. Within a decade, Videocon
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emerged as India's leading brand of both Color and Black & White Televisions and continues to dominate this highly competitive market. The leader innovates. The leader forges ahead. The leader breaks new ground. Harnessing the advanced technology, relentlessly pursuing quality to achieve various international standards of Quality Control. Breaking through, time and again, with innovative products for a better life. VISIONARY VIDEOCON Profiles of Leadership Futuristic Neuro Fuzzy Logic Washing Machines, User-friendly - No-Frost Refrigerators, the very latest music systems. The most sophisticated Color Television and VCRs. HighTech Air-conditioners. Videocon today, is a multi-faceted group, with 9 state -of-the-art manufacturing facilities all over India. Highly qualified engineers, trained in Japan, backed by 6500 technical and support staff, work together in close unison to produce India's leading branch of consumer electronic products and home appliances. Leadership through People Videocon lays great emphasis on the training and development of its work force, providing every opportunity for growth and advancement, including training stints overseas.
LANDMARKS FROM ELECTRONICS TO ENERGY The Heart of Nation
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1995 was a landmark year for Videocon. It clearly reaffirmed its leadership in Color TVs, Black & White TVs, VCRs and VCPs, Washing Machines as well as No-Frost Refrigerators. Then Videocon began to reach out to the core. To industries at the heart of a nation: Petroleum, Power, Construction and Housing. Leading India into the future, with Confidence, with determination, with a commitment to excellence, rooted in the pioneering vision of a path breaker.
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Chapter - 2 Products
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Videocon Mobiles:
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1.1 Competitors
1. LG, Samsung: This strategic group includes the South Korean MNCs. These are the players who are operating only in the frost-free segment and carry a large product length. They have products only in the above 300 Ltrs segment. These brands follow the Premium strategy of high quality at high price. They are targeting to the upper income as well as the higher middle class of the society with the products that are associated with status. These companies have shown a tremendous growth in few years. 2. BPL, Whirlpool: BPL, the market leader in the Frost-free segment and Whirlpool of India, the subsidiary company of the US giant Whirlpool form this group. They have frost-free models in the below 300 Ltrs capacity segments as well as the above 300 Ltrs segment. The models in above 300 Ltrs segment cater to the replacement market and to the higher middle class. These aim at providing high quality at a moderate price. The models in the below 300 Ltrs are targeted at the first time buyers of middle class and are not high in price. 3. Godrej: These are the old brands of India, which have high brand awareness and presence in urban as well as the rural Markets. These are mainly serving to the Direct cool segment and have few models in the frost-free segment. These brands are catering to the middle class and are not very high in prices. 4. Videocon: This is the company, which introduced Frost-free refrigerators in India. The products are value for money products. With the lowest prices in the market it is catering to the middle class of the society.
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5. Voltas: These companies cater to the middle and lower middle class of buyers with their low priced ranges.
The companies in the market witness a tough competition from the other members of its strategic group as they fight for the same chunk of the market. As their products do not differ much in the features, they try to differentiate their brands through copy differentiation in advertising. The competition intensifies as most of the companies are using the same dealer network to distribute their products. They lure the dealers to promote their product by different strategies on margins, incentives and credit and payment terms. The competition increases as all the companies have high Strategic stakes in the Refrigerator Business. A major fraction of their revenues come from this business and so they retaliate sharply to any move of the competitor. The industry has high Exit Barriers for the members who have invested in the manufacturing facilities in India in the form of specialized assets.
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1.2 Comparison with Other Companies
REFRIGERATOR INDUSTRY AT A GLANCE ? Refrigerators are being manufactured in India for the last four decades. ? Till early nineties only direct cool refrigerators were used in India. ? Videocon introduced frost-free refrigerators in 1991. ? In 2005-06 the market was as follows:
1 0.8 0.6 0.4 0.2 0 Price
% Mkt. Share
Direct Cooling
Direct Cooling Frost Free
Segment Direct Cooling Frost Free
Price % Market Share Low 85% 35-40% more than DC 15%
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COMPANIES IN THE REFRIGERATOR MARKET
The leading companies in the market with their market share in first half.
TOTAL MARKET BRAND VIDEOCON Sales (Units) 199000 21000 SAMSUNG LG GODREJ BPL WHIRLPOOL ELECTROLUX OTHERS TOTAL 396000 25000 349000 8000 178000 25000 85000 83000 10000 7000 8000 8000 313000 1535000 180000
FROSTFREE SEGMENT % Share 12.9% 12% 25.7% 14.3% 22.7% 4.6% 11.5% 13.8% 5.5% 7.4% 0.7% 4.0% 0.5% 4.6% 20.3% 100% 100%
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1.3 Distribution Channels in the Industry
The Refrigerator companies in the industry use different distribution channels to reach the customer. These are as follows:
1. In this type of channel the company uses its sales representatives to deal with the dealers directly. The dealers place the order through the sales representatives who visit them periodically, and the products are delivered directly from the company. Some companies appoint Direct Dealers who act as their Franchisee Outlets or their Exclusive showrooms.
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BPL uses this channel
2. In this channel of distribution the company appoints distributors on the basis of District/ Population /No of Dealers to be handled by one distributor. The area of operation and its potential is also taken into consideration. Some of the companies make the distributor totally responsible from appointing the dealers to providing after sales service.
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Godrej use this channel
3. In this channel of distribution the company appoints Distributors as well as Direct Dealers. The company appoints distributors to deal with small dealers who order small quantities. With the dealers who have good potential and sales the company deals directly. Videocon and Samsung use this channel: The Korean Multinational follow this channel where they appoint Distributors for upcountry towns and direct dealers for big cities and major towns eg. Ahmedabad.
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4.
In this channel the company appoints a C&F agent who acts on behalf of the company. The C&F agent is totally responsible for appointment of Distributors and Direct Dealers. He sells to both the Distributors and the Direct Dealers at the same rates.
Strategic group mapping of industry players:
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Chapter - 3 SWOT Analysis
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Strengths:
1. Videocon has largest distributed capacity manufacturing base across India with 17 Facilities and plant in china, Poland, Italy, Mexico. 2. Manufacturing capacity is 1, 40000 units. 3. Tie up with the Matsushita electric company of Japan add to the goodwill of Videocon. 4. Customers are aware about Videocon’s products. 5. Company has good brand name. 6. Strong backward integration 7. Videocon has largest distribution manufacturing based across in India. 8. Large brand basket 9. Multi brand strategy 10. 3rd largest picture tube manufacture in India Cheap price.
Weaknesses:
1. Less investment on advertisement of Videocon CTV 2. Fewer margins to the distributor/dealer. 3. Weak promotional strategy of CTV. 4. Not providing good service. 5. No exclusive show rooms
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Opportunities:
1. Videocon takes over the Electrolux. 2. Videocon buys Thomson color picture tube manufacturing plant. 3. Videocon international is going global. 4. Videocon exploring whole new segment
Threats:
1. Brand loyalty is more of LG &other company. 2. A new competitor in your home market. 3. Increased trade barrier. 4. Brand reputation is not good. 5. Competition in global CPT market especially from integrated players such as LG, Phillips, Samsung, and Matsushita is intense.
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Chapter - 4 Recommendations & Suggestions
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? Freezer should be small ? No crystal, grill shelf should be there ? No MRP is written. So MRP should be written ? Date of manufacturing is not written ? Model change should be there constantly ? Double door refrigerator should be provided. ? In today’s world of competition, the company should pay more attention towards: ? Best sales service • • • • • • • Displays In festivals we do promotions 0% finance Exchange offer High incentives 0% interest Carry back scheme
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Chapter - 5 Learning
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It was a great opportunity to carry a study on such a reputed organization, which give me a good learning experience and knowledge about the products and industries. Another very crucial area that needs to be mention is the experience I gained while talking to and interacting with people. This has been actually enriching experience because interacting with people with varied projects helped me in enhancing my communication skills.
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BIBLIOGRAPHY
? www.videocon.com ? www.yahoo.com ? www.google.co.in ? www.aol.in
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