A PROJECT REPORT ON

TO STUDY OF SALE PROMOTION FOR NILKAMAL PRODUCTS

FOR NILKAMAL PVT.LTD. AT TIRANGA SALES, AURANGABAD SUBMITED TO, UNIVERSITY OF PUNE IN PARTIAL FULFILMENT OF MASTER OF BUSINESS ADMINISTRATION SUBMITED BY MR.DATTATRAY WALUNJ UNDER THE GUIDENCE OF PROF.ASHISH MOHTURE

Dnyanvardhiny Shikshan Sansthas GLOBAL INSTITUTE OF MANAGEMENT, VELHALE, SANGAMNER. (2010-2012 1

CERTIFICATE
This is to certify that Mr.Dattatray Manikrao Walunj is bonafied student of Global Institute of Management Sangamner. Studying in Master of Business Administration. The candidate has satisfactorily prepared the project report on TO STUDY OF SALE PROMOTION FOR NILKAMAL PRODUCTS

This project is the result of candidates own work and satisfactory enough to warrant his Presentation for Master of Business Administration (Second year) Examination. This project report has not been previously submitted by candidate for the degree of other University.

Head of Department Prof. Yogesh Gosavi

Project Guide Prof. Ashish Mohture

DATE:PLACE: - SANGAMNER

DECLARATION
I hereby Declare that the project report entitled of my own outcome of my own efforts under the guidance of Prof .Ashish Mohture Sir and it is submitted to the GLOBAL INSTITUTE OF MANAGEMENT in the Partial fulfillment of master of business Administration (Second Year) Examination 2011-12

I also declare that this project report has not submitted by me to any other University.

Mr. Dattatray M. Walunj DATE:PLACE: - Sangamner

INDEX

Sr.No.

Contents

Page No

Executive Summary

Objectives and scope

Industry Profile

Company Profile

Theoretical background

Research Methodology

Limitation of study

Data Analysis & Interpretation

Findings

10

Suggestion

11

Conclusion

Bibliography

Annexure

CHAPTER NO 1 EXECUTIVE SUMMARY

The Nilkamal Pvt Ltd. Then TIRANGA Sales it is district distributor Agency of Aurangabad .who has provide the Nilkamal furniture of all Aurangabad district. The Nilkamal is molded plastics industry is one of the fastest growing industries. Products of this industry offer economy in usage are durable and have strong aesthetic appeal. Availability and price trends of raw materials like highdensity polyethylene and polypropylene influence the profitability of players in this industry. Middle and low-income segments are the major consumers of the molded plastic furniture. In the Aurangabad Area where I have done this survey unfortunately the end user (the industry) at time is totally oblivious of the multitude material handling solutions available with the Nilkamal. If the end users type of operations are known and if his buying patterns are known, then Nilkamal could get back to the customer, anticipate his purchase and offer him a correct solution. Thanks to the range of products that the company possesses which is unmatched to the range of products of its competitors. A part of this research also intended to create some awareness and sense the maturity of the market vis--vis acceptance of Nilkamal new products into the market. Plastics Tools, Table, Chair Crates & Bins has potential to become great convenience driver for our country. Cheap, Durable and Stackable, this innovation brings with the promise of low cost comfort city on mass scale. Nilkamal was the first to introduce it and has strived to push it to the new limits continuously innovating on design and variety. Nilkamal offer for 65 different items in multitude of colors. Nilkamal has a large range of products across its products categories and has established an industry reputation of being first in the market place with new design and convenience based products The Question regarding Manufactured Items and Process involved was basically asked to know what is being manufactured and material handling plastic could have any application in the concerned industry.

I have done my study in Aurangabad city subject on Sale Promotion Activity. Following has the same objective of my study To study effectiveness of sales promotion activities with special reference to Tiranga Sales. To study the various promotional strategy adopted by Nilkamal Pvt. Ltd To find out the factors that influences the purchase decision of consumers. To study the effects of promotions on sales. To study how customer loyalty can be built through promotional activities.

For this study I have taken sample size is 50, because my study has limited only retailer in Aurangabad district. From this study I found that, Nilkamal furniture has lot of sale in the Aurangabad district. Because of the quality of the product.

CHAPTER NO 2 Objectives of the Study

1) To study effectiveness of sales promotion activities with special reference to Tiranga Sales. 2) To find out the factors that influences the purchase decision of consumers. 3) To study the effects of promotions on sales. 4) To study how customer loyalty can be built through promotional activities.

Scope of the Study

This project was undertaken for a specific period in TIRANGA SALES, OBEROI CHAMBERS, NEAR HOTEL AMARPREET, JALNA RD, AURANGABAD, and MAHARASTRA. It is an exercise that is well planned into the curriculum giving the researcher a valuable opportunity to understand the working dynamics of the organization and to experiment and exhibit the recently acquired management and administration skills.

The prospect of the furniture sector in India seems positive. The Indian furniture industry has awakened to interesting times! The last ten years have seen changes in the shop windows of furniture retailers. Consumers today no longer look for mere practicality in furniture, instead, they look for theme furnishing, i.e. lifestyle living. Realizing the tremendous market potential and to make the most of it, the study was undertaken.

CHAPTER NO 3 INDUSTRY PROFILE

3.1 Indian Furniture Industry

The furniture sector in India only makes a marginal contribution to the formation of GDP, representing just a small percent (about 0.5%), which indicates a huge potential for growth. It is estimated that the furniture industry comprises 25% of the construction industry and hardware comprises 40% of total furniture industry, out of this 20% is replacement and 20% is new. Wood and wooden products, furniture and fixtures carry a weight of 27.01% in the total manufacturing sector. The furniture industry employs a total of around 30,000 workers. The future on the furniture sector in India seems positive. Talking about production, several agreements have been signed between local producers looking for technology and European and Asian companies trying to reach a potential opportunity in costs. From the commercial point of view, India shows good perspective to sell furniture in the following years. First of all, because its size and secondly due to the newly acquired taste as a result of exposure to western furniture style. India is one of the largest consumers of wood in South East Asia. Until a few years ago the county had considerable quantities of available tropical woods. The most common species in Indian forests are teak, rosewood, ebony, laurel, pine, cedar and rubber trees. Supply of these ready to uses species became scarcer due to unconditional and inappropriate exploitation and also due to growing concern about the environment. In India, natural rubber plantations covers 520,000 hectares with another 6,000 hectares replanted almost every year since 1994. Kerala state (South India) produces 95% of the total supply of rubber wood in India. India imports wood (logs) especially from Malaysia, Indonesia, Myanmar, Ivory Cost, Cameroon, Nigeria, Ghana, South Africa and New Zealand and to some extend from South America. Most soft and hard woods are imported from Russia, Scandinavia and other South East Asian counties. MDF is imported from Europe, and there is also a small local

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production. Veneered panel are becoming more popular in India and are imported from the European Union and the USA. The total size of Indian furniture industry is estimated at Rs. 350 thousand million but almost 85% of this is unorganized. The remaining 15% is organized and is believed to be growing at a steady pace of 12% to 15% per annum. The share of the wooden furniture market is estimated at Rs. 600 million. Woodworking industry of India is one of the fastest growing in the countys economy. Much of this growth has been fuelled by the increasing access to modern machinery and technology through easier import policies as a result of Indias entry into the WTO in the year 1990s. There is a noticeable shift in the preference towards mechanized mass production and the up gradation of technology.

The Emerging Trend

Though technology has made inroads in the industry with increasing stress on the use of machines, overall scenario reveals that almost 80% of the products supplied in local markets by indigenous manufacturers are labor intensive and handmade. Residential or household furniture accounts for over 60% of the overall domestic and leading manufacturers have begun to realize the necessity of proper distribution system in this area. Among other sectors where the demand is spiraling upwards is office furniture. Growth of IT an IT- enabled sector such as BPOs has created a huge demand in metros and Class II cities all over India. The old economy businesses are also undergoing a makeover and this is reflected through changing looks of the offices. Metal and plastic furniture production is gaining wider prominence but wood still remains to be the most favored medium.

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3.2 A Look into the Indian Economy and Furniture Industry

India is the fourth largest economy in the world and its the largest democracy with second largest GDP among emerging economies. World Banks President James D. Wolfensohn confirmed that India is not the worlds 4th largest economy after USA, China and Japan in PPP (Purchasing Power Parity). It is also one of the ten fastest growing economies in the world. With 1 billion populations, India remains on the fastest growing economies and even in the present worldwide economic slowdown, has maintained GDP Growth rate of nearly 6%. India today is 7th most attractive destination for foreign direct investments, after US, China, Brazil, Mexico and Germany. Besides, India offers higher rate of returns and profitability than anywhere else in the world. Out of 1 billion population the upper and middle class constitutes 20% or 200 million people (or 30 to 40 million houses). By rent per capita:

2 percent of Indian has a per capita income in excess of 14,500 Euros, which means 20 million people. 8 percent of Indians have a per capita income of more than 3,900 Euros, which means 80 million people.

10 percent of Indians have a per capita income in excess of 3,200 Euros, this is about 100 million people

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3.3 Overall Economic Scenario

1. The Indian market has been enormous with a large base. 2. Levels of affluence are high- with the number of individuals in the high: income
demographic group doubling each year, according to NCAER statistics.

3. The actual disposable income at the disposal of the affluent Indian is as high as
three to five times higher as the official statistics, on account of the very large proportion of unaccounted (black) money income.

4. The market has, due to exposure to overseas products and lifestyles, displayed the
willingness and ability to purchase overseas brands and products at high prices.

5. Customs duties and tariffs have been drastically reduced, in keeping with
government policy to open up the economy a policy which has stayed constant despite changes in government. All the products in the INDEX product range are now permitted for import into India under OGL or the Open General License, which implies that no special import license is required for import.

6. Despite the cut in duties, the rate of customs duties is fairly substantial which
makes the prices of products higher in India. There is a huge demand for furniture, hardware and fittings, DIY equipment, lighting and consumer non-durable and appliances.

7. While the Indian middle class still does not have as high a rate of obsolescence as
the US, and tend to use their furniture for several years before changing or upgrading, the actual size of this segment makes investment in this market more than worthwhile. The affluent classes however, do have high rate of obsolescence of interior decoration products and redecorate constantly. All the above factors put together make manufacturers and retailers of a wide range of consumer durables. Several overseas companies have already entered the market and have been extremely well received by the market.

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3.4 SWOT Analysis of Indian Polymer Industry

The Indian petrochemicals industry is finally discarding its nascent stage tag and the companies are now vying for a major chunk of the global pie of the petrochemicals market. Indian major Reliance has recently acquired a German polyester major Trevira GmbH and this marks the private sector giant's entry into the European markets in a big way. At the same time, ONGC and IOC are planning entry into the business in a major way as this is in line with their forward integration plans. The petrochemicals cycle is currently on a global uptrend thanks to growing demand from China and other developing nations. In the domestic markets, growing activity in infrastructure and construction segments coupled with strong growth in the auto sector on the back of lower interest rates have actually boosted the performance of the petrochemicals sector. Major beneficiaries of this uptrend are the integrated players such as Reliance Industries, GAIL and IPCL (to some extent). A low per capita consumption of 4 Kgs of plastic as compared to a global average of 20 Kgs leaves enough scope for capacity expansion resulting in ONGC and IOC venturing into the business. The following are the major uses of the products:

Polymer Products and the uses

Product LDPE/LLDPE HDPE Uses Consumer packaging/film, extrusion wires, cable coatings Fertilizers, household packaging, woven sacks, cartons, crates, luggage, pipes Polypropylene (PP) PVC Polybutadeine (PBR) Let us now do a SWOT analysis on the industry so as to have a better understanding of the prospects for the industry, going forward: Cement packaging, monofilament yarn, ropes Water pipe, electrical wires, cables, sheets Rubber Automotive tyres and tubes, conveyor belts and footwear

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Strengths:

Consolidation:

The

Indian

petrochemicals

industry

has

witnessed

consolidation over the last few years and nearly 85% of the polymer capacity in the domestic market is with the top three participants (Reliance, IPCL and Haldia Petrochemicals (HPL)). Of the three companies mentioned, IPCL forms a part of the Reliance stable while GAIL is set to pick up stake in HPL. Such high concentration is likely to benefit these players, as this would help reduce duplication of production.

Synergies: Most of the petrochemical players have integrated facilities, thereby reducing external dependence to a large extent. To put things in perspective, Reliance Industries uses naphtha from its own Jamnagar refinery as a feedstock for the petrochemicals production. IPCL uses Reliance's vast and widespread marketing network to reach out to global consumers. On the other hand, GAIL utilizes natural gas for its petrochemicals capacity. Rich natural gas is evacuated into the pipelines and after separation of the hydrocarbons such as ethane, propane and butane, the lean gas is transmitted to consumers such as power and fertilizer industry. Further, petrochemicals business being a high value add, would add further to the profitability of these integrated companies.

Weaknesses:

Low bargaining power vis--vis the suppliers: Input costs form nearly 50% to 60% of the raw material costs. Further, gas prices are regulated but in short supply, while naphtha is an expensive source of feedstock. Refineries realize the import parity prices on naphtha produced and in case of high feedstock prices, petrochemical players have little bargaining power against the suppliers. These players are therefore vulnerable to raw material prices.

Low Bargaining power vis--vis customers: In case of increase in input costs, the companies might not be able to pass on the rise to the consumers as the 15

prices of products is highly influenced by factors such as international prices and supply.

Opportunities:

Low per capita consumption: Currently, domestic per capita polymer consumption is nearly 4 kgs while the global average is nearly 20 kgs. This underlines the fact that there is immense scope of capacity expansion in the country as the market to be tapped is huge. Further, spending on R&D activities is around 2% of sales as compared to an international average of 18%. This leaves enough room for product development. Also, currently, India has a chemicals trade deficit of about US$ 1.5 bn a year, which leaves enough investment opportunities in the industry.

Increased economic activity: The government has set aside nearly Rs 400 bn for infrastructure projects such as roadways, airports and convention centers and also towards rural housing augur well for the petrochemicals industry as this is likely to increase demand for various products (high density polyethylene, low density polyethylene among others) for the purpose of road development, packaging, cables and wiring. Also sustained growth in the auto sector is likely to keep the demand for petrochemical products high. As per our estimates, the auto sector is likely to grow at nearly 12% over the next few years.

Threats:

Customs duties: Historically, the domestic industry has been protected from overseas competition by high import duties imposed by the government. However, of late, Import duty on polymers has been steadily reduced and is currently at 20%. As part of its commitment to various multilateral and bilateral trade agreements, the government is likely to reduce duties going forward and this is likely to reduce the cushion enjoyed by the domestic players as against the landed cost of imported products.

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Growing competition: The domestic industry is likely to witness immense competition going forward with IOC all set to enter the segment with its Rs 64 bn project in FY06. Further, ONGC is also venturing into petrochemicals business. With commitments to reduce and eliminate tariff and non-tariff barriers, India, with huge market potential, might witness entry of global majors such as ExxonMobil, Dow Chemicals and Shell into the business. These global majors with deep pockets can actually lead into a pricing war, which could result in squeezing margins.

The above analysis is just to provide a view of the sector and by no way advocates any opportunities to invest in the petrochemicals sector. Taking a cue from their global counterparts, Indian majors such as IOC and ONGC are entering into this value add business in a huge way and this is likely to change the entire business dynamics of the companies, not only in India but Asia as Asia is fast becoming the largest petrochemicals manufacturing hub. Going forward, investors need to be aware of this reality and make informed investment decisions in the energy sector.

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CHAPTER NO 4 COMPANY PROFILE 4.1 Introduction

Nilkamal Plastics is Asia s largest plastic processor of moulded products. We make products that have changed the very nature of the good transportation and furniture industry in this region. The NILKAMAL GROUP, Indias leading manufacturer of Moulded Furniture and Material Handling Crates having a turnover in excess of US$ 100 million and is also the worlds largest manufacturer of moulded furniture. The group commands market leadership in India with five state of the art manufacturing facilities in various states of India accredited with quality certificates like ISO 9001 & ISO 14000. The group has not only limited its manufacturing operations in India but have also gone beyond Indian boundaries with its expertise in the field of plastics and has set up Joint venture manufacturing facilities in Sri Lanka (again an ISO 9001 certified unit) as well as Bangladesh. Apart from having overseas manufacturing facilities the group also has a warehousing facility along with a marketing office set up in Ajman Free Zone, United Arab Emirates which will cater to the requirement of customers in the Middle East & the African continent. The group has a wide array of products in both the furniture as well as crates segment. The Furniture product range comprises of Chairs, Dining Tables, Coffee Tables, Trolleys, Shoe racks, Multipurpose racks, Baby chairs stools etc to mention a few. As regards crates the group has all sizes of crates that cater to various industrial applications. Innovation is also a major asset of the group and hence they are able to add at least 10 new products to the already existing wide range.

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4.2 CORPORATE WORLD

Nilkamal's mission is to 'provide value through convenience' to its consumers. We aim at attaining a firm grip on the market through value initiatives directed towards our stakeholders. Since inception, Nilkamal has traveledin only one direction: upwards. There has been no looking back and the company has persevered to attain market leadership in this industry. In the first year of production itself, the company witnesses a profit of more than Rs. 5 crores. The compounded growth has been 30% annually and today the annual profits have reached Rs. 12 crores and 37 lakhs. Through our years we have proven this track record.

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4.3 PLANT LOCATION

Nilkamal has business presences in over 30 locations all over the country and manufacturing facilities in all four corners of the region.

WestIndia A) Kharadpada, Silvassa (Union Territory- Factory of NILKAMAL Crates &BinsPvt.Ltd.) The ISO 9001: 2000 factory complex has an area of 35,000 sq.meter with an installed capacity of 9000 metric tons Per Annum.

This factory houses manufacturing facilities like Injection moulding, Rotational moulding, Polypropylene Corrugated box, Vacuum forming & Blow moulding product. This factory is primarily focused on Material Handling products and OEM products for customers such as defense, automobile manufacturer etc.

B) Vasona, Silvassa (Union Territory) This 30,000 sq. meter, ISO 9001:2000 factory complex has an installed capacity of 13,500 metric tons Per Annum at present for manufacturing of Moulded Furniture & Crates. Material Handling

20

Sinnar-Nashik(Maharashtra) This 22,000 sq. meter, ISO 9001:2000 factory complex has an installed capacity of 6800 metric tons Per Annum primarily to manufacture crates for Fruits &Vegetable industries.

North India Greater Noida (Uttar Pradesh) This 16,000 sq. meter, ISO 9001:2000 factory complex has an installed capacity of 11,500 metric tons Per Annum for manufacturing of Moulded Furniture & Material Handling Crates

South India Pondicherry (Union Territory) This plant is manufacturing Moulded Furniture System & Material Handling products. This 13,500 sq. meter, ISO 14000 factory complex has an installed capacity of 6200 metric tons Per Annum.

21

East India Barjora (West Bengal) This 50,000 sq. meter factory complex is 9001:2000 certified has an installed capacity of 6200 metric tons Per Annum catering to Moulded Furniture & Material Handling Crates business.

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4.4 VISION AND MISION

Nilkamal mission is to provide value through convenience to its customers. We aim at attaining a firm grip on the market through value initiative directed towards our stakeholders. Since inception, Nilkamal has traveled in only one direction: upwards. This has been no looking back and the company has preserved to attain market leader ship in this industry. In the first year of production itself, the company witnessed a profit of more than Rs 5 Crores. The compounded growth has been 30% annually and today the annual profits have reached Rs.18 Cores & 31 Lakhs approximately. Through over years we have proven this fact record. Originally incorporated as Creamer Plastics Pvt Ltd. The name of the company was changed to NILKAMAL PLASTICS in August 1990. It initially came out with a public issue shares at par in Feb 1991 and subsequently made a right issue in FY 94 to expand its capacity. The promoter of Nilkamal Plastics Parikh Family old majority stakes of 54% in the company while the public hold the balance. The companys manufacturing activity is currently undertaken through five plants. Two units are located at Silvassa in Gujarat while one plant is located at Sinner in Maharashtra, Pondicherry in Tamil Nadu and Noida in UP. It has recently set up new manufacturing unit at Barjora in west Bengal and Vasona in Gujarat to cater the increasing demand for its products. The company is set up a Joint Venture in SriLanka called Nilkamal Eswaran with the installed capacity of the unit 4000 tons subsequently. The company further expanding the capacity of the unit 6000 ----tons. This company recently established a wholly owned subsidiary Nilkamal Eswaran Marketing Pvt Ltd. That will focus on marketing activity.

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4. 5 PRODUCT PROFILE
Following are furniture product of the company Furniture

Chairs
o

Premium Chairs

Baby Chairs

Novella Chairs

24

Shell

Stools

Centre Table

25

Dining Table

Trolley

Corner Cabinet Rack

Planter

Toy Storage Solutions 26

Ready To Assemble Furniture

Office Seating Solution

School Benches

Sofa

27

CHAPTER NO 5

THEORETICAL BACKGROUND
Consumer are not only looking for the core product or functional benefits from the sellers but also the non functional benefits needs to be compatible with their life style e.g. most of the People refer to branded products and maximum People not support to unwarranted productstheir product offering the atmospherics on the line of the multinational chain to compete with them and to serve change exception of the consumers. To understand what and from where the shoppers shop it is an important to analyze the reasons that promote Buying behavior.

5.1 Marketing Mix Tiranga Sales

Different companies can choose to position themselves differently and hence the marketing mix would be different. However, there are certain common characteristics that one can call out from the possible strategies that companies can adopt.

Marketing Mix 5.1.1 Product:

Tiranga Sales offers wide variety of products, ranging from Chairs, Tables, and other furniture. I have listed the products available at the Tiranga Sales along with the ranges available in that category Furniture

Chairs
o o o o

Premium Chairs Baby Chairs Novella Chairs Shell

Stools Centre Table Dining Table 28

Trolley Corner Cabinet Rack Planter Toy Storage Solutions Ready To Assemble Furniture Office Seating Solution School Benches Sofa

5.1.2 Price:
Price is the monetary value of the product. Price deals with selecting the pricing objectives, setting the price, discounts, allowances, payment policies and credit terms. It is very important to the customers as it decides the cost the customer has to pay to gain the product value.

5.1.3 Place:
This marketing tool stands for the various activities the company undertakes to make the product accessible and available to the customer. It involves market size, channel selection and management, storage and physical distribution with the ultimate purpose of efficiently supplying the companys offer to the target market. To the customer, this marketing tool refers to convenience.

5.1.4 Promotion:
Promotion stands for various activities the company undertakes to communicate and promote its products to the target market. It involves communication programs i.e. direct marketing, advertising, sales promotions, public relations and motivation of sales force. To the customer this tool provides knowledge and information. The Promotion Mix of a company includes the following tools;

Advertising:
It is any paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor.

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Direct Marketing:
It refers to the use of mail, telephone and other non-personal contact tools to communicate with or solicit a response from specific customers and prospects.

Personal Selling:
Face to face interaction with one or more prospective purchasers for the purpose of making a sale refers to personal selling.

Public Relations and Publicity:

It refers to the variety of programs designed to promote and or protect a companys image or its individual products.

5.2 Sales Promotions:

The short-term incentive to encourage trial or purchase of a product or service refers to sales promotion. Whereas advertising offers a reason to buy; sales promotion offers an incentive to buy. Since sales promotion directly push up the sales, increasing number of companies are undertaking sales promotion activities. Sales promotion refers to the short-term incentives to encourage sales of a product or service. It consists of a diverse collection of incentive tools, mostly shortterm, designed to stimulate quicker and greater purchase of products or services by consumers.

5.2.1 Purpose of Sales Promotion

Sales promotion tools vary in their specific objectives. They may be used to attract new customers, to reward loyal customers and to increase the repurchase rates of occasional users. Sales promotion usually targets brand switchers because nonusers and users of other brands do not always notice a promotion. Sales promotions are thus also seen as a tool for breaking down loyalty to other products. Sales promotions also let manufacturers adjust to short term changes in supply and demand and differences in customer segments. They also let manufacturers to experiment by varying prices. Sales promotions also lead to greater consumer awareness of prices. To use sales promotion, a company must set objectives, select the right tools, develop the best program and implement it and evaluate the results.

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5.2.3 Objectives of Sales Promotion

The specific objectives set for sales promotions will vary with the type of the target market. For consumer promotions, objectives include encouraging purchasing of larger sized units, building trial among non-users and attracting switchers away from the competitors brands. For trade promotions, objectives may include; including retailers to carry new items and higher level of inventory, encouraging off-seasonal buying, of-setting competitive promotions, building brand loyalty of retailers and gaining entry into new retail outlets. The sales force promotions help in encouraging support of a new product or model, encouraging more prospecting and stimulating off-seasonal sales. But most importantly, sales promotion should be focused on consumer relationship building.

5.2.4 Sales Promotion Tools

Many tools can be used to accomplish sales promotion objectives. Descriptions of the main promotional tools are as follows;

Consumer Promotion Tools

The main consumer promotion tools are as follows; Samples: They are offers of a trial amount of a product. It consists of inviting prospective purchasers to try the product without cost or at a lower cost in the hope that they will buy the product. Samples may be free or discounted. Coupons: Coupons are certificates that give buyers a saving when they purchase a specified product. Coupons can be mailed, placed in advertisements or included with other products. Rebates: Rebate is also known as cash refund offers. Rebates are offers to refund part of the purchase price of a product to its customers who send a proof of purchase to the manufacturer. These are like coupons except that the price reduction occurs after the purchase and not at the point of sale.

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Price Packs: Cents-off deals or price packs offer consumers savings by way of reducing prices that are marked by the producer directly on the package.

Premiums: These are the goods offered either free or at a low cost as an incentive to buy a product. Premiums may be in-pack or on-pack (outside the pack)

Prizes: They are offers of chance to win something such as cash, trips or goods by luck or through extra efforts. Contests of talent and sweepstakes or draws the most popular prize offering promotions.

Tie-in Promotions: Tie-in promotions involve two or more brands or companies that team up on coupons, refunds or contests to increase their pulling powers.

Cross Promotions: Cross promotions involve using one brand to advertise non-competing brand. Advertising Specialties: These are useful articles imprinted with an advertisers name, given as gifts to consumers.

Patronage Rewards: They are cash or other awards for the regular use of companys products or services. They are values (in cash otherwise) that are proportional to ones patronage of a certain vendor or a group of vendors. They aim at building brand loyalty.

Pop Promotions: Point of purchase (Pop) includes displays and demonstrations that take place at the point of purchase or sale.

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Trade Promotion Tools

More money is spent by companies on trade promotion (58%) than on consumer promotions (42%). The major trade promotion tools are as follows; Discounts: It is also known as price-off or off-invoice or off-list. Discounts price cut off the list price on a particular quantity purchased during a stated time. Allowances: They are the amount offered in return for an agreement by the retailer to feature the manufacturers products in some way; displays, advertising or otherwise. Free Goods: Free goods are the extra merchandise offered to middlemen who buy a specific amount of a product. Companies also offer push money and specialty advertising items to the middlemen. Business Promotion Tools Companies spend huge amount on promotions focused on industrial consumers. The major business promotion tools are as follows; Trade Shows and Conventions. Sales Contests. Clearly, sales promotions play an important role in the total promotion mix. To use it well, the marketer must define the sales promotion objectives, select the best tools, design the sales promotion program, pretest and implement the program and evaluate its results.

5.3 TYPES OF SALES PROMOTION FOR INDUSTRIAL PRODUCTS The above mentioned theory is a general approach for sales and promotion Now being more specific the sales promotion techniques or tools for industrial products will be discussed .The most significant sales promotion activities for many industrial marketers are as follows,

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1. Trade show exhibits:

Are basically used to meet potential customers, discover new product applications, introduce new products, demonstrate non portable

equipments, aid and attract new dealers, and match competitive efforts.

2. Catalogues:
Catalogs are other important components of promotional strategy for a number of industrial marketers. The catalogs serve the purpose of producing orders, developing recognition, generating request for information, stimulating invitations to bid and getting marketers product specification adopted by as many firms as possible While designing the catalogue the marketers take into account who are its principal users and what type of information they hope to be present in the catalogues.

3. Samples:
Samples are especially useful in promoting new products, as well as being a general aid to the salesman. Due to their expense, the distribution of samples needs to be well planned.

4. Letters:
Letters are also a useful sales promotion activity if properly composed and properly timed. If not, they may have a negative effect. It is probably advisable to place to place responsibility for promotional letters in a specialized unit, although almost every division and department of a business usually participates by supplying information to the unit.

5. Promotional novelties:
They are secondary means of sales promotion but are often effective as continuing reminders of the marketer and his products. Both promotional novelties and entertainment can be useful in smoothing the process of market development as well as negotiations with customers.

34

6. Public relations:
Essence of public relations is proper conduct of a firms relationship with the various subgroups which compose its general public. This requires thorough study of the way in which the companys operations affects each of these groups and a comprehensive program for responding in a positive way to each of them.

Sales promotion for industrial products implemented at Lectrotek:

1. Letters. 2. Catalogues. 3. Public relations. 4. E-mails

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CHAPTER 6

RESEARCH METHODOLOGY
Selection of Methodology for the study is one among the most important part of completion of the project report because it provides the easiest & wider range for collection of relevant information & data. It is of important for the management students to approach the business organization in a systematic way to gather information. Information can be retrieved either from books, magazines. The main ingredient of the methodology includes collection & classification. Collection of the consistent & relevant data which are interpreted to arrive at the rational inferences. Questionnaire was prepared for Tiranga sales customers and respondents were interviewed. The research was exploratory in nature.

6.1 Primary and Secondary data

Primary data or the information for the preparation of the research project refers to numerical figure obtained by the measurement. There are two types of sources for data collections: Primary sources Secondary sources

6.1.1 Primary Sources:Primary data is generated by the students or the researcher for the preparation of project & used methods namely. a) Questionnaire b) Interview. by student immediately for collecting data. He can use various

36

a)

Questionnaire:This method is most frequently used by researchers .In this method

formulating the questions relating personal opinions, suggestions, ideas, personal references, social attitudes, & feelings.

b) Interviews
Interview is a powerful method of data collection. It is verbal method of obtaining data. The student collects information by communicating with the respondents. This is the most direct means of conducting inquiry in to any research problem. An interview is to official for organization structures.

6.1.2 Secondary Sources

Any data which have been gathered earlier for some other purpose are secondary data in the hands of the marketing researcher. Primary data collected by one person may become the secondary data for other Sources for collection of secondary data are 1) Research records 2) Internet

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6.2 Data collection Collection of Primary Data

Primary data collected by the response to the Questionnaire was prepared for seeking information about Nilkamals product, price, quality, promotion tools, advertising tools, sequence of departments, structured questionnaire is a formal.

Collection of secondary data

Company profile and other background information was Collected from the Tiranga Sales and also internet. The finding of the survey were tabulated, analyzed and graphically represented and interpret thereafter for easier understanding Recommendations follow these at the end that assists the company in deciding its actions and strategies.

6.2.1 Sampling:Sampling is the one of the most fundamental concepts underlying any research work. It is the study of relationship existing between a population and various samples drawn from this population. The parts of the population that are selected constitute the sample, the technique involved in selecting them is called as sampling technique and the study based on these principles is called a sample survey. The area covered was surrounding of mall. For the questionnaire of customer.

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For this project I have chosen Convenience Sample Method. Convenience Sampling

Definition
Uses those who are willing to volunteer.

Uses
Readily available, large amount of information can be gathered quickly

Limitation
Cannot extrapolate from sample to infer about the population prone to volunteer bias.

Justification
It may be noted that when a small sample of a few units is to be selected a Convenience sample may be more suitable as the errors of Convenience are likely to be less than random errors of a non-probability sample.

Sample Frame:The primary requirement of the frame is that it covers the specific target population and is reasonably accurate.

Sample Size:The sample size selected was 50 for the available of Nilkamal furniture ltd. The sample size appeared adequate considering the limited available time.

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CHAPTER 7 LIMITATIONS OF THE STUDY

Every study is bound by limitations and as such this is no exceptions.

1. Lack of co-operation shown by the Shopkeepers. 2. Very little time given by the Shopkeepers to get the required feedback. 3. Lack of proper cooperation from retailers. 4. Data collected may have response error.

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CHAPTER 8 Data analysis and Data Interpretation

No1.No of companys furniture selling form shop Table No. 1 Content 1 2 3 4 One Two Three More than Four No of Respondent 6 15 9 20 50 Percentage 12% 30% 18% 40% 100%

Graph No. 1

No of Respondant
1 One 2 Two 3 Three 4 Four

12% 40% 30%

18%

Data analysis and interpretation:More than 50% of shopkeepers are selling three or more brands of furniture in Aurangabad market.

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2. Awareness about Nilkamal Furniture.

Table no. 2

N0. 1 2

Content Yes No

No of respondents 46 4

Percentage 92% 8% 100%

Awareness of the Product

Yes No

8%

92%

Data analysis and interpretation:More than 90% respondents are aware about the Nilkamal furniture. Still 8% respondents are unaware about the Nilkamal furniture.

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No 3.Keeping a Nilkamal furniture

Table No. 3

N0. 1 2

Content Yes No

No of respondents 39 11

Percentage 78% 22% 100%

Graphs No. 3

Keeping the Nilkamal Furniture

Yes No

22%

78%

Data analysis and interpretation:Maximum respondent are Keeping the Nilkamal furniture. But there is opportunity to expand their sale in the Aurangabad.

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No. 4 Highest selling furniture Table No.4 N0. 1 2 3 4 5 Content Supreme No of respondents 10 Percentage 20% 40% 32% 28% 10% 100%

Nilkamal 20 National Prince other 9 6 5 50

Graph No.4

Sales
Supreme Nilkamal National 0% 9% 10% Prince other

23%

58%

Data analysis and interpretation:Above the data Nilkamal having the maximum sale in Aurangabad city. And then others like Supreme, National, and Sai. Etc.

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No. 5 Reason for Maximum sale Table No. 5 N0. 1 2 3 4 5 Content Price Quality Services Advertisement Schemes No of respondents 13 22 7 2 6 50 Graph No.5 Percentage 26% 44% 14% 4% 12% 100%

Sale by
Price Quality Services Advertisement Shemes

4% 14%

12%

26%

44%

Data analysis and interpretation:Customers are always preferred on the quality of the product. Maximum Sale of Furniture on the price and quality of the furniture.

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No. 6 Best durable furniture Table No 6 N0. 1 2 3 4 5 Content Supreme No of respondents 13 Percentage 26% 40% 20% 8% 6% 100%

Nilkamal 20 National Prince other 10 4 3 50

Graph No. 6

other 6% Prince 8%

Durablity
Supreme 26%

National 20% Nilkamal 40%

Data analysis and interpretation: Nilkamal Furniture having a best durability compares other furniture. Then supreme is durable furniture.

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No. 7 No of times ordered given for furniture in particular year Table No. 7 N0. 1 2 3 4 Content less than 5 5<10 10<15 More than 15 No of respondents 7 13 8 22 50 Graph No. 7 Percentage 14% 26% 16% 44% 100%

Order to Buy
less then 5 5<10 10<15 More than 15

14% 44% 26%

16%

Data analysis and interpretation:More than 60% retailers are giving more than 10 times order in the particular year.Means that retailer has not giving a bulk order to the Tiranga sales.

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No.8 preference of the brand Table No. 8 N0. Content 1 2 3 4 Quality Price Durability easy availability No of respondents 26 7 13 4 50 Graph No. 8 Percentage 52% 14% 26% 8% 100%

Preferance
Quality Price Durablity eassy availablity

8% 26% 52% 14%

Data analysis and interpretation:More than 50% Customer prefer on the quality of the furniture. Quality is a major factor which doing a affect on the customer while purchasing furniture.

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No.9 Maximum selling furniture Table No.9 N0. 1 2 3 4 6 7 Content No of respondents Chairs 28 Percentage 56% 8% 20% 6% 8% 2% 100

Benches 4 Table Rack Stools Trolley 10 3 4 1 50

Graph No.9

Max. Selling Furniture

Stools Rack 8% 6% Trolly 2%

Table 20%

Chairs 56%

Benches 8%

Data analysis and interpretation:Chair is the maximum selling furniture in different type furniture.Chairs having maximum demand in the Aurangabad market.

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No 10. High profit margin Table No. 10. N0. 1 2 3 4 5 Content Supreme Nilkamal National Prince other No of respondents 11 17 10 7 5 50 Graph No.10 Percentage 22% 34% 20% 14% 10% 100%

Sales
National 10% other 0% Prince 9%

Nilkamal 23%

Supreme 58%

Data analysis and Interpretation:Nilkamal giving high profit margin to the retailer compare the other furniture company.

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No.11. awareness about promotional activity Table No.11

N0. 1 2

Content No of respondents Yes No 34 16 50

Percentage 68% 32% 100

Graph No. 11

Promotional Activities
1 2

32%

68%

Data analysis and Interpretation:The maximum retailer are aware about the promotional activity rendered by Tiranga sales, stillmore than 30% retailers are unaware about the promotional activity.

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No. 12 Promotional activity carried out by Tiranga sales. Table No.12

N0. 1 2 3 4 5

Content Advertising Trade fare And Exhibitions Coupons Free offer Attractive financial schemes

No of respondents 22 8 3 10 7 50

Percentage 44% 16% 6% 20% 14% 100%

Graph No. 12
Attractive financial schemes 14%

Chart Title

Free offer 20%

Advertising 44%

Coupons 6%

Trade fare And Exhibitions 16%

Data Analysis and Interpretation:-Advertising is the most effective sales promotional activity. Trade fare and exhibitions & Attractive financial schemes are minimum rendered by Tiranga sales.

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No.13 Satisfaction about Promotional activities. Table No 13

N0. Content No of respondents 1 2 Yes No 32 18 50 Graph No. 13

Percentage 64% 36% 100%

Satisfaction about Promotional activities

1 2

36% 64%

Data analysis And Interpretation:There is the maximum satisfaction of the retailer by the promotional activity rendered by the TIRANGA SALES.

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CHAPTER NO9 FINDINGS

1. From this study that 92% respondent are aware about the Nilkamal furniture, 8% Respondents are not aware about the Nilkamal furniture 2. 78% respondent are Keeping the Nilkamal furniture, 22% Respondents are not keeping the Nilkamal furniture. 3. As a quality matter 38% retailers are selling a Nilkamal furniture 4. In Aurangabad city as per the study 40% sale of Nilkamal furniture from the total sale of furniture 5. That26% retailer Are prefer in or Buy the Nilkamal furniture on the basis of price,44% are quality,14% are services, 4% Advertisement and 12% schemes. 6. 40% Customer are buying the Nilkamal furniture on the basis of durability of furniture. 7. 52 % retailer giving his preference quality of Nilkamal furniture 8. In Aurangabad city Chairs are having maximum sale thats 56% in to total sale of furniture. 9. As per the profit margin Nilkamal has giving a maximum profit margin thats 34% respondent are agrees with this. 10. 67% retailer are aware about the companies promotional activities and other not aware about the promotional activities 11.As far as promotional activity satisfaction is concern maximum retailer satisfied but still 34% retailer are not satisfied, there is scope to expansion.

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CHAPTAR NO 10 SUGGESTION
The TIRANGA SALES should mostly concentrate on promotional tools to have the advantage in the competitive market by creating a differentiation with comparison to others. Proper awareness programs like promotional activities should be adopt. To participate in various exhibition in Aurangabad city. Maintain Co-ordination between every Shopkeepers. Stimulate the every shopkeeper by giving various offers for maximization sale.

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CHAPTAR NO 12 CONCLUSIONS
In Aurangabad city various companys furniture are available in market. As far as furniture are concern the customer prefer on the quality and durability of furniture. Availability of Furniture was studied and it was found to be easily available. Sales of Furniture was studied, there is vast market potential for furniture. There is no effective promotional activity. Retailer s satisfaction level about Furniture product was studied and very high.

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