Professional Documents
Culture Documents
ON
ASIAN PAINTS LIMITE
SUBMITTED
SUBMITTED
TO
BY
Prof S.Balasubramanyam
C.SOWBHAGYA LAKSHMI
M.B.A 1 st year,Roll No: 89535
SCHOOL OF MANGEMENT
NATIONAL INSTITUTE OF TECHNOLOGY
WARANGAL-506004
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INDEX
1. ASIAN PAINTS OVERVIEW ........................................ 2
2. BACKGROUND
............................................. 3
3. VISION
.............................................. 4
4. MISSION
............................................... 4
5. MAJOR CORPORATE EVENTS ..................................... 5
6. COMPETETIVE ADVANTAGE PROFILE .......................... 7
7. CORPORATE FACTORS ............................................... 9
8. STRATEGIC MANTRAS OF ASIAN PAINTS LTD .............. 10
9. SWOT ANALYSIS
...................................................... 12
10.MARKET SEGMENTATION ............................................ 13
11.ANSOFF MATRIX
........................................... 15
12.FUTURE PLANS
............................................16
13. ANALYSIS & SUGGESTIONS ..........................................17
14.CONCLUSION
................................................ 19
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LEARNING OBJECTIVE
The learning objective for the industry analysis is to determine the
opportunities and threats that exist for firms within a competitive
environment.
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The learning objective for the firm analysis is to determine the strengths
and weaknesses of a firm and to determine the core competence that can
be built on to establish a competitive advantage.
The final step is to develop a sound business plan to ensure the survival
of their chosen firm within its competitive environment.
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Asian Paints Limited(APL) is the market leader in the Indian paint industry,
commanding a market share of 38 per cent in decorative paints and 33 per cent
overall in the organised sector. Its annual sales turnover exceeds Rs. 1,300
crore, way ahead of all the competitors in the industry. In profits too, Asian
Paints is far ahead. Asian paints market leadership in the decorative paints
segments can be grasped correctly when we take note of the relative position of
the various players in the industry. Whereas Asian Paints has a market share of
38 per cent, its nearest rival, Goodlass Nerolac, commands a share of just 14 per
cent. All others have only less than 10 per cent. Such an achievement by a
company that is wholly Indian in capital, management and technology and in an
industry historically dominated by multinationals is certainly a commendable
feat
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2. Background
Asian Paints Limited was established in 1942 as a partnership firm by four
friends Champaklal H. Choksey, Chimanlal N. Choksi, Suryakant C. Dani and
Arvind R.Vakil to manufacture paints in a garage in Mumbai (Bombay). From
its humble beginnings, the company has moved on to become the largest paints
company in India with a market share of 30 per cent.The company with a
turnover of US$ 535 million on standalone basis and US$ 640 million on
consolidated basis (including turnover of all its subsidiaries) is one of the top
ten decorative paints companies in the world. Its reach and dominance in the
Indian market can be gauged from the fact that it is more than twice the size of
its neares competitor in India and it has been the market leader in paints
industry in India since 1968.The company operates in 22 countries and has 29
paint manufacturing plants in the world which service consumers in over 65
countries.The company operates around the world on its own and also through
its three subsidiaries Berger International Limited,Apco Coatings and SCIB
Chemicals.The company aims to become one of the top five decorative paint
companies in the world and has embarked on an aggressive strategy of
expanding its global operations. The promoters hold the majority stake in the
company (46.8 per cent of the equity stake).The next largest shareholders are
the foreign institutional investors (19.5 per cent stake), followed by Indian
public (16.5 per cent stake). Domestic banks, financial Institutions, mutual
funds and insurance companies hold 13.4 per cent stake. Corporate bodies and
non-resident Indians hold the remaining stake.
ASIAN PAINTS PRODUCTS
Asian Paints is engaged in manufacturing of paints. The company offers interior
and exterior wall paints, automotive paints, powder coatings, auto refinish
paints, and wood finishes. It operates in 22 countries and has 29 paint
manufacturing facilities in the world servicing consumers in over 65 countries.
It is headquartered in Mumbai, India and employs 3,924 people
1)
2)
3)
4)
5)
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3. VISION
Asian
4. MISSION
To provide paints as per market demand, ensuring desired level and quality of
customer (dealer) service, continued availability of the right product mix of
right quality at the right time.
CORE VALUES
Commitment and Integrity in dealing with internal and external
customers
A strong belief in individual ability and creating an environment in which
entrepreneurial spirit is encouraged
Ownership and Responsibility
To continuously Rejuvenate every living and working space of people
and bring joy to their lives
CORE PURPOSE
To continuously rejuvenate every living and working space of people
and bring joy to their lives
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1945
1957
1967
2002
2005
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APLs whole business operation can be divided into two segments i.e. Paints
and Chemicals.
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7.
Corporate factors
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AWARDS
Awarded the "Sword of Honour" by the British Safety Council for all the
paint plants in India. This award is considered as the pinnacle of
achievement in safety across the world.
Forbes Global magazine, USA ranked Asian Paints amongst the 200 'Best
Small Companies of the world' in 2002 and 2003 and amongst the top 200
'Under a Billion Firms' of Asia in 2005.
Ranked 24th amongst the top paint companies in the world by Coatings
World - Top Companies Report 2006.
The Asset - one of Asia's leading financial magazine ranked Asian Paints
amongst the leading Indian companies in Corporate Governance in 2002 and
2005.
Received the Ernst & Young "Entrepreneur of the Year - Manufacturing"
award in 2003
ENVIRONMENT AND SAETY :
Asian Paints approaches the environment issue from the perspective of
waste minimisation and conservation of resources.
It attempt is to reuse, recycle and eliminate waste, which results in less
and less waste being generated. Accordingly, the material losses in
manufacturing have been reduced substantially over the last few years.
It has ISO 14001 certification for environment management standards.
It has achieved 'zero industrial discharge' capability. This has been
achieved by the installation of upgraded effluent treatment facilities and
installation of reverse osmosis plants in conjunction with appropriate
recycling and reuse schemes. Our emulsion manufacturing facility has
also achieved 'zero waste' status. It has adopted the principles of "green
productivity".
Some of its innovative schemes which enhance green productivity are
dealer tinting systems which has resulted in large batch sizes ; bulk
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storage facility for monomers which reduces wastage; Use of natural gas
which is a cleaner fuel ; solvent recovery plants have been set up which
has resulted in zero reduction of solvent disposal ; Improved incinerating
systems and reverse osmosis.
The "Sword of Honour", instituted by the BSC, is recognized the world
over as the pinnacle of achievement in safety management systems.
QUALITY POLICY:
We shall provide products and services that meet stated standards on
time, every time.
We accept Zero Defect as a quality absolute, and shall design and operate
our quality system accordingly.
We will organise our work practices to do a job right the first time, every
time.
We are committed to continuous improvement in quality in all business
processes and shall track such improvement through measurable
indicators.
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At the time Asian Paints entered the Indian paint business. Distribution was the
most crucial task for any new entrant. Both physical distribution and channel
management posed formidable challenges. The foreign companies and their
wholesale distributors dominated the business. Also they were shutting the
doors on any new paint company seeking an entry into the business. They
concentrated on big cities where they could make the sales without much
investment in distribution infrastructure and market development.
Asian Paints sized up the scenario and formulated a unique strategy. It went in
for a strategy that differed totally from the existing pattern.
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Strength :
NO.1 Player in decorative paints and 2nd in industrial paint segment.
Wide range of products with around 8500 colors.
Geographically well spread giving the company logistical advantage.
International presence giving opportunity to reap benefit from
international growth.
wide distribution network i.e. 19,000 dealers.
Highest manufacturing capacity.
Strong finanacial helps the company to invest in marketing and brand
recall activities.
weakness :
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Threats :
Growing industry and low capital intensive nature of business will attract
competition.
Setting up Greenfield project and buyout are viable options for
international players to enter the domestic market.
Industry growth depends on two factors
(a) Repaint activity and
(b) Construction. Any slowdown in any of the two will have
direct impact on the company sales.
Aggression from existing players
The external environment saw an entry of a lot of multinationals trying to
attack us on various segments
10.Market segmentation :
Asian Paints segment the market based on the usage :
BRAND POSITIONING
It is how the Asian paints enabled people to form a mental image for their
products in the customers mind. The strategies that they followed where as
follows,
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Brand Image
The ways in which Asian Paints attempted to meet the customers psychological
and social needs.Indian paint industry is a low involvement industry. Till 1990s
people will just tell their budget for painting their house to their contractors.
And few customers will also mention the colour they need. During that period
Asian Paints analyzed the customer market and found that people where not
brand conscious but their concern was only the price of the paint. To meet this
needs of the customer
Asian paints reduced the cost of the raw materials by backward integration in
order to reduce the cost of the paints
Established an advertising strategy with created an emotional touch among the
customers
All these strategies helped them in creating a Brand Image for their products
among people and people started realizing the need for brand conscious in this
industry.
Umbrella Brand
In 2004 the company realized that though they have almost 20 brands only few
products like Apex emulsion, Royale interior emulsion, Apcolite and Touch
wood had high recall among the customers. Therefore they decided to promote
the brand as a whole, to create a corporate image and the various products under
their Umbrella Brand Asian Paint, which became their mother brand. This
created a Brand Awareness as a whole among the customers.
Brand Portfolio:
It was realized that instead of spending on individual brands and in promoting
them it was logical to promote their corporate image and allthe brands under
their umbrella brands ...
Asian Paints has embarked on an umbrella branding policy encompassing all its
products and services. The project includes a new visual identity that establishes
the company name as the dominant reason for purchase. Tractor, Royale, Utsav
and Apcolite names are no longer the focus on the can, rather consumers will be
buying "Asian Paints." Some key brand names are being retained for the time
being--to signal a position in the market rather than a product or surface. For
instance, Tractor will represent the "value for money" brands.
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The immediate advantage is obvious. Rather than spread resources thinly across
brands and sub-brands, a company centric portfolio can synergize
communication efforts. To be competitive in a world of fragmentation and rising
costs, traditional mass media, such as television, can be prohibitively costly.
With the umbrella-branding move, Asian Paints can also afford to move forward
from a mere functional platform for each individual product to the high ground
of a mood-based emotional dimension.
An Underlying Theme
At Asian Paints, the underlying theme is "har ghar kuchh kehta hai," or "every
home has something to say." The depth and texture visualized by this line goes
into the customer's basic psyche of owning a home, and will carry through
various messages emanating from the company, which is the leader in the
decorative coatings market in India.
11.ANSOFF Matrix
Asian Paints value for the customers was build through innovative package
(size),distribution , and communication .In 1970s they decide to computerize
and network their 30 depots round the country ,to provide proper feedback of
market needs ,resulting in quick response to meet the needs.
They planned a new distribution structure , smaller packages and
computerized communication networks. Asian paints differentiation strategy
starts from market segment, distribution & packaging .
With increasing volumes in chosen segments Asian Paints achieved
economies of scale for cost leadership .With their dominant position they
diversified in product range as also market and geographic segment.
1. They diversified into manufacturing raw materials for paints.
2. product diversification also included industrial paints .Now with a large
market share ,they have strong distribution network even in metros.
Asian paints strategy of quick response translates into supplying 95% of the
order supply in 48 hrs which is a positive competitive advantage .Their R&D
has developed new products to later to industrial & scientific segments . The
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With 27% market share, they enjoyed double the market share than their
nearest competitor .In order to maintain this leadership position they have
drawn up the following strategy.
12.Future Plans :
The company plans to consolidate its dominant position in India by launching
new products in line with the market developments in both decorative paint and
industrial coating segments. The company is focusing on further improving the
operations of all of its subsidiaries in India and abroad and has already launched
E-Strides, an ERP initiative through which all the overseas ventures are being
covered for sharing of global knowledge, best practices and better control on
operations. The companys objective is to be among the top three players in
each market where it is currently operating or plans to operate in the future
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Green concepts and techniques in the construction sector can help address
national issues like handling of consumer waste, water efficiency,
reduction in fossil fuel use in commuting, energy efficiency and
conserving natural resources.
Most importantly, these concepts can enhance occupant health, happiness
and wellbeing.
So automatically enhance the mood of occupant and they feel fresh
throughout the day and in the mean time profit also increases.
If we observe the Marketing Strategy :
Since the firm has following good strategies ,but it must be careful about MNCs
coming for various segments.and there is aggression from existing palyers.
14.CONCLUSION
An independent survey named Asian Paints to be one of the best
companies in Asia in paint industry and other.
Business Today showed that the company was one of the most transparent
and a leader on the issue of innovative methods.
EXCELLENT MANAGEMENT SYSTEM
EFFECTIVE OPERATIONAL MANGEMENT
GOOD NUMBER OF SUPPLIERS AND DISTRIBUTORS.
LOTS OF AWARDS
No.1 PAINT COMPANY IN PAINT INDUSTRY
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