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Introduction of the Topic

What is Horizontal Expansion?

Expansion of business capacity through the absorption of facilities or buildings as well as through the acquisition of new equipment to handle an increased volume in sales in which the business is already engaged.In microeconomics and strategic management, the term Horizontal Expansion describes a type of ownership and control. It is a strategy used by a business or corporation that seeks to sell a type of product in numerous markets. Horizontal Expansion in marketing is much more common than Vertical Expansion is in production. Horizontal Expansion occurs when a firm is being taken over by, or merged with, another firm which is in the same industry and in the same stage of production as the merged firm,

For e.g. Nerolac has adopted strategy of Vertical Expansion by which Nerolac wants to improve its sale from Asian Paints monopoly outlets, means its monopoly outlets are being taken over by Asian Paints now in this condition to improve its sale Asian Paints need to open new outlets which is called Horizontal Expansion Strategy. A monopoly created through Horizontal Expansion is called a Horizontal Monopoly. This is the expansion of a firm within an industry in which it is already active for the purpose of increasing its share of the market for a particular product or service.

Reason of Horizontal Expansion

The ultimate objective of Asian Paints is to acquire more customers and serve them properly. While doing Horizontal Expansion take care to the competitors strategy. The main competitor is PEPSI, who has opted Vertical Expansion to generate more sell however Asian Paints do not believe on Vertical Expansion because Vertical Expansion has limited preview so ASIAN PAINTS is great believer in Horizontal Expansion and this strategy helped to the company to maintain its leadership in the soft drink industry.

India is a big country having diversified taste and appearance and same character is reflected in their demography. Horizontal Expansion helps the company to serve the more people and more customers touch point because in the waste country many customers commute. Benefits of horizontal expansion: Provides Incremental Volume & Revenue for Business. By horizontal expansion there will be more outlets of our product In the market which will sell our product in more quantity. This will generate incremental revenue for the business. Helps Improve Route Productivity There are pre determined routes through which product is transported and delivered at the Asian Paints outlets. If we open more outlets on the routes it will increase the productivity because more outlets will be covered and more products will be delivered with a negligible increase in time and efforts. Hence it will improve productivity of the route Improves Profitability of Our Distributors Expenses on routes and delivery of product are incurred by the distributers. Opening new outlets will give more revenue to our distributors also. With the increase in route productivity will improve profitability of the distributors. Reduced Dependence on Large Customers, We know that Asian Paints products have a very good demand. To comply with this we have to provide large amount of supply. In case we have few outlets a large amount of stock is gathered at few retailers. In this case they become monopolistic and demand many things like hoardings and glowshine boards discounts margins etc. from the company. So it is very necessary to reduce dependence on large retailers by opening new outlets. Increase market visibility selling at more outlets give more market visibility of the product which gives higher product recognition and brand value to the products.

 Economies of scale Economies of scope Increase in market power over supplier and downstream market channels.

Advantage of horizontal expansion over vertical expansion:

Both expansion techniques are meant for increasing sales volumes. But in horizontal expansion company can earn more profits by spending less. Lets see the profit story of horizontal expansion

Above tables clearly indicate the importance of opening new outlets. By doing vertical expansion only growth in profit was not very effective but because of opening just 200 new outlets sales increased to a large extent. Total profit margin and return on investment also increased.

How to do Horizontal Expansion

To do Horizontal Expansion more efficiently I made a profit story and talk to the shopkeepers according to that story.

Story
Salesperson hello sir, I am from Asian Paints and I have a proposal that will surely increase your income. May I present you? Shopkeeper yes please present it Salesperson - Sir if you will start to sell Asian Paints then your overall sale will be increased and it is not tough to sell Asian Paints because Asian Paints is the leader in paimting industry and a very well known brand. Shopkeeper- yes, but how it can increase my overall sale? Salesperson - Sir, you are dealing in construction material. And these products have a very good combination with paints. If a person wants to purchase any of these products then it is quite possible that he will purchase Asian Paints and vice versa. Shopkeeper But how Asian Paints can increase my profit? Salesperson Sir if you are really interested to explore through asian paints, you may be able to sell it to the customer as you know that asian paint is the leading brand of painting industry ,and it gives a good emphasis on advertising so you need not to make any extra effort to sell it to the customer. Along with all this advantages our company also provide you the promotional tools like glow shine board, hoarding. And we will also provide you the home painting guide which will help you to make a long term relationship with your customer.

Vertical or Horizontal Growth

When growing your business you need to decide on a growth strategy Here are two examples: 1) Vertical growth - focusing on current customers to make additional purchases of your product or services. Develop new products or services to appeal to existing customer base. 2) Horizontal growth - finding new customers to buy existing products or services. Expand the geographic reach of your business as well as sell to different customers in same area.Don't limit yourself. You can combine both strategies. If you are a smaller firm, concentrate on one at a time. Communication Tip - when communicating to your target market - U.S. Mail postage, envelope, paper and labor on average will cost you $1 per person, an email about 3 cents per person. In microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies are united through a hierarchy with a common owner. Usually each member of the hierarchy produces a different product or (market-specific) service, and the products combine to satisfy a common need. It is contrasted with horizontal integration. Vertical integration is one method of avoiding the hold-up problem. A monopoly produced through vertical integration is called a vertical monopoly, although it might be more appropriate to speak of this as some form of cartel. Nineteenth century steel tycoon Andrew Carnegie introduced the idea of vertical integration. This led other businesspeople to use the system to promote better financial growth and efficiency in their companies and businesses. In microeconomics and strategic management, the term horizontal integration describes a type of ownership and control. It is a strategy used by a business or corporation that seeks to sell a type of product in numerous markets. Horizontal integration in marketing is much more common than vertical integration is in production. Horizontal integration occurs when a firm is being taken over by, or merged with, another firm which is in the same industry and in the same stage of production as the merged firm,

e.g. a car manufacturer merging with another car manufacturer. In this case both the companies are in the same stage of production and also in the same industry. A monopoly created through horizontal integration is called a horizontal monopoly. A term that is closely related with horizontal integration is horizontal expansion. This is the expansion of a firm within an industry in which it is already active for the purpose of increasing its share of the market for a particular product or service.

Advantages of Horizontal integration

Economies of scale, in microeconomics, are the cost advantages that a business obtains due to expansion. They are factors that cause a producers average cost per unit to fall as scale is increased. Economies of scale is a long run concept and refers to reductions in unit cost as the size of a facility, or scale, increases.[1]Diseconomies of scale are the opposite. Economies of scale may be utilized by any size firm expanding its scale of operation. The common ones are purchasing (bulk buying of materials through long-term contracts), managerial (increasing the specialization of managers), financial (obtaining lower-interest charges when borrowing from banks and having access to a greater range of financial instruments), and marketing (spreading the cost of advertising over a greater range of output in media markets). Each of these factors reduces the long run average costs (LRAC) of production by shifting the shortrun average total cost (SRATC) curve down and to the right. Related Corporate Diversification When multiple lines of business are linked in a firm, the firm is pursuing a strategy of relateddiversification. Such a firm is conscious of leveraging its resources and capabilities beyond asingle product or market into those businesses that are related to their current activities. Related diversification can happen in two ways: Related-constrained when all the businesses in which a firm operates share a significant number of inputs, production technologies, distribution channels, similar customers, etc. Related-linked when the different businesses that a single firm pursues are linked on only a couple of dimensions, or if different sets of businesses are linked along very different dimensions. Examples help in understanding the critical difference between related-constrained

and related-linked types of diversification. Bic, the French Company, produces products such as disposable razors, cigarette lighters, and pens. The company pursues a related-constrained diversification strategy because all their products share significant commonalities in the areas of plastic injection molding, retail distribution, and brand name. Newell Rubbermaid is a good example of a related-linked firm. After Newell Company acquired Rubbermaid, the company is organized into five segments: cleaning and organization; home and family; home fashions; office products; and, tools and hardware. All five segments share common distribution channels supermarkets (such as Wal-Mart) and office supply stores (Staples, Office Depot, etc.). The products are sold under various brand names (Sharpie, Levolor) and do not typically share common technology or inputs across segments.

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Objectives of the study

Primary Objective:

1. To understand & explain the Horizontal Expansion Concept of the company. 2. To enlist the roles and responsibilities for Horizontal Expansion at retail end and its benefits. 3. To understand how to make The Horizontal Expansion Process more effective

Secondary Objectives:
1. To study the distribution system of the company. 2. To identify if there exists any training requirement for the improvement of sales to its sales team 3. To develop the business, expand the market coverage, acquisition of retailers, retention strategies and maintaining customer relations.

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SCOPE OF THE STUDY

This study has been done at Lucknow region in Uttar Pradesh only. During the study I went through different aspects. The study would be only a drop in the ocean that can help to understand the current status of activation elements of Asian Paints in retail outlet. The study can be conduct on the national basis also with large sample size & sufficient time by taking feedback of many retailers which sell Asian Paints products. There are some important aspects of this study which are as follow

1.

This project work is helpful in making a in-depth analysis of the horizontal expansion strategy of Asian Paints in Lucknow.

2. This project work will be helpful in conducting higher studies regarding the overall satisfaction of Asian Paints from the dealers perspective. 3. This report work will help the company to devise further marketing & sales strategies. 4. During my project I came to know about Narolac Marketing strategy that is the biggest competitor of Asian Paints.

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LIMITATIONS

Considering the fact that Nothing is perfect in the world, every individual is bound to make mistake at some points, and it is genuine. The study was restricted to Lucknow region only. Limited knowledge of the researcher in the field of research may lead to interpretation errors. The respondents may be biased or influenced by other factor. A busy schedule of dealers/ retailers also makes the collection of information a very difficult one. The project is purely based on observation & verbal meetings and may be influenced by unprecedented factors. Non-co-operative behavior of respondent was a big problem in this survey. . The research was based on primary collection of data through voice interview and observation so there may be chances of human error. The research was depending on the information provided by the respondents (retailers). It may insufficient. As associated with project, time and money were the major limitations with this project.

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RESEARCH METHODOLOGY
Data Collection
This research involved a study, which was descriptive in nature it basically aims at gathering data about how the Asian Paints red element concept &scheme playing in the mind of retailer & consumers. During the research period I collected data direct from retailers by survey. For proceeding further first of all we should know something about data and what the different type data are-

TYPES OF DATA: 1. P RIMARY

DATA .- DATA

T HERE

ARE TWO TYPES OF DATA -

ORIGINATED

BY

THE

RESEARCHER

FOR

THE

SPECIFIC

PURPOSE

OF

ADDRESSING THE RESEARCH PROBLEM .

2. S ECONDARY
HAND .

DATA .- DATA COLLECTED FOR SOME PURPOSE OTHER THAN THE PROBLEM AT

METHODS OF DATA COLLECTIONPrimary data collection: 1. Observation 2. Experiment 3. Survey But here, only surveys method of data collection is preferred which is very suitable to reach the researcher motto. A. Research instrument: Printed Questionnaire was used as the research instrument to collect the required information. B. Area of surveys: The survey was conducted at Lucknow. Primary data can be collected by three methods-

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SAMPLE DESIGN

Sampling unit: The retailer of construction material, hardware store and small level of builders was selected from different places of Lucknow. Sampling size: 150 Type of sampling: there are two type of sampling. 1.Probability sampling. 2. Non probability sampling.

Probability sampling- It is also known simple random sampling. In this sampling everybody gets similar chance to select as a sample unit.

Non probability sampling- In this sampling everybody gets not similar chance to select as a sample unit. Example of non probability are cluster sampling, convenience sampling, judgment sampling e t c.

Sampling procedure: Simple random sampling procedure was followed. Sampling method: Data were collected by retailer survey. The retailers are directly contacted and interviewed at their retail counter.

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CHAPTER-2
INTRODUCTION TO THE COMPANY

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Introduction to the Company

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Paint Industry
Paint industry estimated at Rs. 135bn. Unorganized sector accounts to 35% of paint market. Volume growth estimated at 15%. Indias share in the world paint market is 0.6%. Per capita consumption of paint in India is 1.2kg/annum.

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Introduction to Asian Paints

Introducing the Asian Paints Group
Asian Paints is India's largest paint company and Asia's third largest paint company, with a turnover of Rs 96.32 billion. The group has an enviable reputation in the corporate world for professionalism, fast track growth, and building shareholder equity. Asian Paints operates in 17 countries and has 24 paint manufacturing facilities in the world servicing consumers in over 65 countries. Besides Asian Paints, the group operates around the world through its subsidiaries Berger International Limited, Apco Coatings, SCIB Paints and Taubmans. Forbes Global magazine USA ranked Asian Paints among the 200 Best Small Companies in the World for 2002 and 2003 and presented the 'Best under a Billion' award, to the company. Asian Paints is the only paint company in the world to receive this recognition. Forbes has also ranked Asian Paints among the Best under a Billion companies in Asia In 2005, 06 and 07, The company has come a long way since its small beginnings in 1942. Four friends who were willing to take on the world's biggest, most famous paint companies operating in India at that time set it up as a partnership firm. Over the course of 25 years Asian Paints became a corporate force and India's leading paints company. Driven by its strong consumer-focus and innovative spirit, the company has been the market leader in paints since 1968. Today it is double the size of any other paint company in India. Asian Paints manufactures a wide range of paints for Decorative and Industrial use. In Decorative paints, Asian Paints is present in all the four segments v.i.z Interior Wall Finishes, Exterior Wall Finishes, Enamels and Wood Finishes. It also introduced many innovative concepts in the Indian paint industry like Colour Worlds (Dealer Tinting Systems), Home Solutions (painting solutions Service), Kids World (painting solutions for kid's room), Colour Next (Prediction of Colour Trends through in-depth research) and Royale Play Special Effect Paints, just to name a few.

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Asian Paints has always been ahead when it comes to providing consumer experience. It has set up a Signature Store in Mumbai & Delhi in India, where consumers are educated on colours and how it can change their homes. Vertical integration has seen it diversify into products such as Phthalic Anhydride and Pentaerythritol, which are used in the paint manufacturing process. Asian Paints also operates through APPG (50:50 JV between Asian Paints and PPG Inc, USA, one of the largest automotive coatings manufacturer in the world) to service the increasing requirements of the Indian automotive coatings market. Another 50:50 JV with PPG has been proposed which will service the protective, industrial powder, industrial containers and light industrial coatings markets International Presence Today the Asian Paints group operates in 17 countries across the world. It has manufacturing facilities in each of these countries and is the largest paint company in eleven countries. The group operates in five regions across the world viz. South Asia, South East Asia, South Pacific, Middle East and Caribbean region through the five corporate brands viz. Asian Paints, Berger International, SCIB Paints, Apco Coatings and Taubmans. The Group operates as:

Asian Paints in South Asia (India, Bangladesh, Nepal and Sri Lanka) SCIB Paints in Egypt Berger in South East Asia (Singapore), Middle East (UAE, Bahrain and Oman), Caribbean (Jamaica, Barbados, Trinidad & Tobago) Apco Coatings in South Pacific (Fiji, Tonga, Solomon Islands and Vanuatu) Taubmans in South Pacific (Fiji and Samoa)

The company has a dedicated Group R&D Centre in India and has been one of the pioneering companies in India for effectively harnessing Information Technology solutions to maximize efficiency in operations.

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Corporate Information

VISION
Asian Paints aims to become one of the top five Decorative coatings companies world-wide by leveraging its expertise in the higher growth emerging markets. Simultaneously, the company intends to build long term value in the Industrial coatings business through alliances with established global partners.

HISTORY
TODAY

Asian Paints becomes the 10th largest decorative paint company in the world Asian Paints is more than twice the size of its nearest competitor It is one of the most admired companies in India Present in 22 countries with 27 manufacturing locations, over 2500 SKU's, Integrated SAP - ERP & i2 - SCM solution Rated Best Employer by BT-Hewitt survey, 2000 Bluest of the blue chips by Hindu Business Line; Most admired company to work for by ET-BT survey, 2000 On the recommendations of Booz, Allen and Hamilton, Asian Paints restructured itself into Growth, Decorative and International business units and adopted SCM and ERP technology

Asian Paints aims to become the 5th largest decorative paint company in the world

1967

Asian Paints emerges as India's leading paint company ahead of any international competition.

1957 - 66

The family-owned company makes the transition to a professionally managed organisation.

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British company Balmer Lawrie rejects the products of a giant British paint company in favour of Asian Paints. Asian Paints embarks on an ambitious grassroots marketing campaign, partnering with thousands of dealers in small towns all over India.

1954

Asian Paints mascot, Gattu, the mischievous kid, is born.

1945

Asian Paints touches a turnover of Rs. 3,50,000, with an innovative marketing strategy "to reach consumers in the remotest corners of the country with small packs."

1st February, 1942

Armed with little knowledge and great determination, Champaklal H. Choksey, Chimanlal N. Choksi, Suryakant C. Dani and Arvind R. Vakil get together to manufacture paint in a garage on Foras Road, Bombay. They name their company 'The Asian Oil & Paint Company', a name that they picked randomly from a telephone directory.

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BOARD OF DIRECTOR

Mr. Ashwin Choksi Non-Executive Chairman

Mr. Ashwin Dani Non-Executive Vice Chairman

Mr. Abhay Vakil Director

Mr. K B S Anand Managing Director & CEO

Mr. Mahendra Choksi Director

Mr. Amar Vakil Director

Mrs. Ina Dani Director

Ms. Tarjani Vakil Chairperson of Audit Committe

Mr. Dipankar Basu Director

Mr. Mahendra Shah Director

Mr. Deepak Satwalekar Director

Mr. Rajendra Shah Director

Dr. S Sivaram

Mr. S Ramadorai

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Group Subsidaries

Apco Coatings is a subsidiary of Asian Paints in the South Pacific islands. Asian Paints operates in Australia, Fiji, Tonga, Solomon Islands and Vanuatu under the brand name of Apco Coatings.

Asian Paints Industrial Coatings Limited has been set up to cater to the powder coatings market which is one of the fastest growing segments in the industrial coatings market.

Website: www.bergeronline.com Few companies can claim of a history of consistent growth for over two and a half centuries, a presence in over 35 countries and an impact on the lives of over a billion people. Berger does that with elan. Ever since it was founded in England in 1760 by Lewis Berger, who perfected a new process for making Prussian Blue the colour of most military uniforms then, Berger has never looked back. Over the years Berger expanded its operations across oceans, to cover numerous geographies. In 1994, Berger units were brought under the single umbrella of the holding company 'Berger International Limited (BIL)' with headquarters in Singapore, which was also listed on the Singapore stock exchange. In November 2002, BIL became a part of the Asian Paints Group. Today, the name of Berger is synonymous with quality and innovation. BIL has presence across three regions viz. Middle East, Caribbean and South East Asia. In the Caribbean region, Berger is a household name. And considering that the company celebrated 50 successful years in the region recently, this is not surprising.

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Incidentally, Berger Paints Jamaica Limited, which is listed on the Jamaican stock exchange, is amongst the top ten companies in the country in terms of market capitalisation. In the Middle East too Berger is a well-respected brand. It is the largest paint company in Bahrain. Using its state-of-the-art manufacturing facilities there, and in United Arab Emirates, it exports to countries in the Commonwealth of Independent States, Gulf Cooperation Council and Africa. In South East Asia Berger enjoys a fine reputation and has operations in Singapore and Thailand.

Website: www.scibpaints.com Founded in 1979, SCIB Paints today is a reputed name and ranks amongst the top five paint companies in Egypt. SCIB Paints became a part of the Asian Paints group in August 2002

Website: www.asianppg.com Asian PPG Industries Limited, a joint venture between Asian Paints (India) Limited and PPG Industries, Inc. USA with 50:50 equity sharing was established in March 1997 with the objective of providing solutions to the paint requirements of Indian Automobile manufacturers. The joint venture brought together two leading companies with strengths in technology, manufacturing and customer insight.

Website: www.Taubmans.com.au Taubmans Paints Fiji, the fourth largest paint company in Fiji, became a part of the Asian Paints family in September 2003. Taubmans Paints is the dominant player in the project sales segment in the country and is a leader in the neighbouring SamoaIslands. It has two manufacturing facilities, one in Suva (Fiji) and the other in Samoa.

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Asian Paints- Today

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Products & Its Features

INTERIOR PAINTS. EXTERIOR PAINTS. WOOD FURNISHES. WOOD & METAL FURNISHES.

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Product Name: Asian Paints Apex Ultima

Description:Asian Paints Apex Ultima Advanced Anti Algal Weather Proof Emulsion is a water-based,modified acrylic, anti algal, high performance exterior wall finish. It incorporates the latest state-of-the-art technology to provide long-lasting exterior performance even in the most extreme tropical conditions of india. Its unique advanced anti algal chemistry ensures that exterior walls are provided with power-packed resistance aganist algae and fungi growth. Its has very good dirt pick up resistance and dirt cleaning properties

Product Name: Asian Paints Apex

Description: Apex Weatherproof Exterior Emulsion is a water-based 100% acrylic, exterior wall finish. A high performance, long-lasting exterior paint specially formulated to withstand extreme tropical conditions of high rainfall, humidity and heat, Apex provides excellent resistance against the growth of algae and fungi on the walls. It offers excellent protection against alkali and UV degradation too.

Product Name: Asian Paints Duracast Fine Tex

Description:Asian Paints Duracast Fine Tex is a 100% acrylicd water based exterior productspecially designed as an intermediate coating.It facilitates excellent adhesion of subsequent coats .Its unique texture pattern has distinctive appeal. 1.Asian Paint Duracast Fine Tex is a rollable product which will provide opacity in single coat without any sagging 2.It serves as an undercoat which will not only provide protection but also decor for a variety of exterior & interior surfaces 3.It promotes adhesion of subsequent coats 3.It hides surface undulation & fine cracks

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Product Name: Asian Paints Apex Stretch

Description: Asian Paints Apex Stretch Water Repellent Exterior Paint is a 100% acrylic, water-based hi-performance long-lasting exterior wall finish. This has an in built elasticity (Stretches more than 150% of its original size) which with adequate dry film thickness can bridge hairline cracks in the plaster up to 0.5mm. Due to the compactness Apex Strtech resists penetration of water caused by wind driven rain and is coupled with excellent anti-algal and anti-fungal properties.

Product Name: Asian Paints Royale Play

Description:Asian Paints Royale Play is a water-based special effects paint designed to create a variety of special effects on interior walls.

Product Name: Asian Paints Royale Play Dune

Description: Asian Paints Royale Play Dune offers a unique collection of subtle metallic textures in Gold and Silver base, in 3 different styles for your interiors.

Product Name: Asian Paints Royale Play Safari

Description:Asian Paints Royale Play Safari offers rich metallic shades with unique grain texturing that resemble islands on the wall.

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Product Name: Asian Paints Royale Play Metallics

Description: Asian Paint Royale-Metallic is a water-based special effects paint that creates a variety of effects on interior walls with a Metallic Designer look.

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COMPETITORS

International Operations

GROWTH CYCLE OF THE COMPANY

a) 1942-1967 b) 1967-1982 c) 1982-1986 d) 1987-1997 e) 1997-1999

Evolution Phase Extension and Consolidation Phase The years of Excellence Moving Closer to the Consumer Changing rules of the game

f) 1999- Present The new Asian Paints

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Mergers & Acquisitions

a) Buys Taubmans Paints (Fiji) In September 2003. b) Acquires ICI Indias Unit (February 2007). c) Sells stake in Australian Unit (June 2007). d) Marketing, Sales & Distribution e) Rural Marketing Initiatives since 1960. f) Distribution is one of the main strategies of Asian Paints. g) Advertising & Promotional Expenditure started in 1980s. h) Advertising Methods- Radio, TVCs, Print, Internet, i) OOH, POP, Retail Outlets, Seminars, Workshops. j) Advertisements k) Promotional Expenditure grew from 15% in 2003 to 21% in 2008.

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SUPPLY CHAIN MANAGEMENT

Supply Chain Management to meet changing demands.

Market Share

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Key Strategies

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From Consumer goods to FMCG The Birth of Gattu

Paints were usually considered to be a low involvement product. In earlier times, the decision of the brand was taken by the builder/contractor and the home owners are not involved much in the process. Asian Paints realized the need for brand building even during sixties. But at that point of time, the company had a wide range of brands/subbrands. The focus of the company was on product innovation and service network and managing quality proposition. The brand focused on mass and rural market. Asian Paints had a mascot called Gattu who was created by the celebrated cartoonist R K Laskhman. These efforts made the brand a leader during the late sixties.

Celebrate with Asian Paints

Although volume justified the leadership position, share of mind for the brand was very low. That was the result of the mass segmentation adopted by the brand. Rightly so because the industry was driven by channel driven promotions, building a brand was very difficult. During 1983, the company tried to reposition the brand as a premium brand. The corporate campaign Spectrum of Excellence was aimed to position them as a leader in the industry. But this campaign failed to inspire any interest in the consumers. Asian Paints undertook a consumer research aimed at understanding the perception of consumers about the product category. As per research, consumers felt that paints could change the mood of the space and it was a sign of festival and plenitude. It could make a gloomy place bright and pleasant. From this insight came the campaign of Asian Paints associating itself with festivals as customers tend to repaint their houses on the occasion of festivities. This resulted in the birth of the campaign Celebrate with Asian Paints. The campaigns were carefully crafted and there were different campaign for different regions. These campaigns effectively enhanced the brand equity of Asian Paints.

Reinvention

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During the late nineties the brand had to be reinvented because of increase in competition during festive season and also preference to other products during festival season. The choice of color became a high involvement decision. The company went in a for a brand overhaul. The logo was changed to a contemporary upmarket one designed by Enterprise IG based in Singapore. The logo/design was to convey self expression, sophistication and technology. Thus came the birth of a wonderful positioning strategy created by O&M. The insight was that the brand is about people and homes and homes reflect the people living in it. Hence Har Ghar Kuch Kehta Hai translated to Every Home has a story to tell. Their website is plays a key role in promotions. The famous hindi film actor Saif Ali Khan is the brand ambassador for their premium brand Royale.

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Advertisements of Asian Paints

Asian Paints- On the prowl
It would be difficult for you to miss the paint ads on Television. They are all over the place. No genre of channels are left untapped, be it sports, news, GECs, or even Cartoon network or regional channels. Two Indian paint giants, Asian paints and Kansai Nerolac Paints are looking for one upmanship in this festival sector. No one wants to be left behind in the endeavour to increase the market share and imprint the brand awareness. This is more true than ever for these two companies with the global paint giant, Sherwin-Williams entering India. They have bought Nitco Paints in 2007 and are waiting for the opportune moment to start aggressive marketing campaigns. They have adopted the inorganic growth path to give them a firm footing from which to start attacking the Indian giants. Asian paints have 3 new ads currently broadcasted. First is the ultra sophisticated and fabulously made Royale Teflon ad with Bollywood superstar Saif Ali Khan. It wouldnt be an over praise or exaggeration if it is said to be one of the most well executed ads in India. Contract Advertising should be duly credited for this fabulous work. Second is the Apex Ultima ad and third, the Tractor Emulsion ad. The tractor emulsion competes on price. The ad says sirf dikhne mein mehenga hai (only expensive in looks). Both the ads have high recall value. Asian Paints has unveiled its new brand identity and logo which reflect a more meaningful and personalised engagement with the increasing number of interior dcor consumers in the home, retail and commercial segments. Asian Paints is now a complete dcor and design solutions company, having also launched the first branded home painting service in the world under the brand name Asian Paints Home Solutions and the colour inspiration concept store.

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The new identity is expected to be rolled out over the next month at all the 5,277 critical retailer stores followed by the rest of the network. The change was inspired by research insights that showed that: Upward mobility of the urban middle class has been rising quite rapidly over the past several years which has resulted in a higher involvement and willingness to invest in home aesthetics. The emerging professionals group consisting of double-income professionals or younger influencers such as teenagers/young adults prefer design and dcor companies that assist the makeover process through color guidance, paint process guidance and related services. The home makeover process that includes tiling, upholstery, furniture, etc., cuts out a significant portion of the home owners budget. Hence, the paint category has immense potential to use color in an innovative and creative manner to provide more design and decor solutions than ever before.

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MANAGEMENT POLICY
MANAGEMENT DISCUSSION AND ANALYSIS:(2011-2012) The year began with several challenges both on the domestic and international fronts. The upheaval in Middle East, sovereign debt crisis in the European countries and weak recovery hopes for other developed economies threatened to derail the global economic environment at the beginning of the year. Additionally, India had its own set of challenges viz., inflation, interest rates and regulatory uncertainties. Amidst all these, however, there was a sense of optimism and hope that the environment would recover sooner than later and it was expected that the Indian economy would grow at around 8.5% on the back of strong domestic demand and a thrust on Infrastructure development. Reality, however, turned out to be otherwise. The macro-business environment during the year was characterized by uncertainty and volatility. The set of challenges which we began with either intensified or are still to be addressed. The sovereign debt crisis in Europe remains unresolved, USA saw a downgrade for the first time in the recent history and Middle East continues to face socio-political tensions. Expectedly, crude oil prices have remained firm during the year leading to commodity inflation across the board. The world has been trying to solve these problems or at least avoid any further aggravation, for quite some time now. The ground realities in India have not met the expectations either. The country is expected to have grown at 6.9%during the year against a growth of 8.4% registered in previous year. This in itself is an indication of the pressures being faced on the domestic front. Although disappointing, the fact that the country was battling near double digit inflation (mainly due to global cost push and agricultural supply constraints) cannot be ignored. Sticky inflation also led to a tight monetary policy which moderated growth during the course of the year. The impact was largely felt on the industrial sector whereas agriculture and services continued to do well. The rupee felt this pressure and breached the 50 level mark during the year, aggravating the concerns for importers. However, after remaining subdued for a better part of the year, some of the indices have started looking up. Inflation has started showing signs of easing and RBI has responded by cutting CRR and interest rates, signaling a softer regime going forward. It remains to be seen how the economy responds to these measures.

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In this uncertain environment, Company has made the best use of its resources and abilities to come out stronger from the tides. A lot to thank the outgoing Managing Director & CEO, Shri P.M. Murty for what the Company has achieved. His contribution to theCompany during his tenure needs no reiteration. The performance of your Company during FY 2011-12 is detailed below: 1. PRODUCTS AND MARKETS The Company operates in Decorative coatings and Industrial coatings segments across India and in the geographies of Asia, Middle East, Caribbean and South Pacific Islands through its subsidiaries and joint ventures. It has presence in 17 countries with 24 paint manufacturing facilities. The Paint industry volume growth in India during FY 2011-12 was strong across regions, albeit a bit lower than initial expectations. Margins in the industry were under pressure owing to surging inflation in input prices seen during the year. Industrial Paints business faced pressures due to the slowdown witnessed in the Industrial sector. Especially in automotive coatings, the markets didnt perform as was expected initially due to surging fuel prices and tightening interest rates. International business did well in spite of the regional turmoil in Middle East and subdued economic conditions in the Caribbean region. The Asian markets fared well owing to strong domestic demand conditions. Raw material inflation caused pressures on the margins of international units as well.

DECORATIVE PAINTS INDIA

Decorative Paints contribute more than 75% of the Indian Paints market. The Company continues to do well in the market place and has focused on defending the position earned over the years. Strong volume and value growth was seen in the segment during FY 2011-12. The strategies followed by your Company have enabled it to grow satisfactorily in spite of stiff competition. The key feature of FY 2011-12 was the high level of inflation for the second consecutive year. Despite five price increases with an overall impact in excess of 12%, gross margins dropped during the year. Fortunately, the substantial increases in prices did not affect demand which continued to be fairly robust. Going forward, margins are likely to remain under pressure in light of the uncertainty in commodity and other input prices.

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The trend of high growth in emulsions and exteriors witnessed in recent years continued. This helped in registering a better mix and higher growth rates. Overall, the product mix offered by the Company is getting richer on account of good growth rates seen in emulsions, thus steadily reducing the dependence on enamels and distempers. The Company offers the broadest mix in the product portfolio to the customers and has successfully established its strength in the premium segment in the last few years. During FY 2011-12, the interior emulsion category continued to grow well on the back of good marketing work done in Royale (the new Teflon co-branding and the launch of the Shyne variant). Tractor Emulsion continues to grow extremely well, thereby, becoming the preferred Economy Emulsion in the market. The Exterior Emulsion category has strengthened with the inclusion of Apex Ultima and textured finishes in the portfolio. Asian Wall Putty has also been growing well in the recent past. Major thrust areas were identified to secure growth, ensure customer satisfaction, supply chain capability and capability building for the future during FY 2011-12. The Company continued to expand its sales network. The Colour World reach has now grown to over 21000 dealers. The 43 Colour Idea stores that have been opened so far continue to be an area of consumer delight. The concept would be expanded significantly over the next three years.

The Signature stores in Mumbai and Delhi (which was opened during the year) continue to attract a large number of consumers who respond very positively to the experience. Innovative marketing initiatives are being undertaken to increase consumer connect and awareness on painting. The Happy Painting Guide and Colour Scheme PRO (Mobile

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application enabling consumers to create colour combinations) that have been launched are a step in this direction. Samplers and Foresites service continue to receive a good response. Shop-boy and dealer training and other Critical Retailers specific initiatives are also being undertaken vigorously .With volumes doubling nearly every five years, Company needs to invest in capability to effectively implement its growth strategies. Work on the construction of the 7th Decorative paint plant at Khandala (Maharashtra) is progressing steadily and is on course for commissioning a capacity of 300,000 KL in fourth quarter of FY 2012-13.Rohtak plant (Haryana) produced 125,000 KL in its second year of operation. The capacity at Rohtak has been increased from 150,000 KL to 200,000 KL per annum and this capacity is now available from the first quarter of FY 2012-13.Construction of the Distribution Centre at Patancheru Plant is underway and by the end of FY 2012-13, all plants with the exception of the Bhandup Plant would have operating Distribution Centres allowing complete migration to the new Distribution Model. This new model is expected to facilitate higher service levels with lower levels of inventory going forward.

INTERNATIONAL OPERATIONS
FY 2011-12 was a challenging year for the overseas operations of the group. Most of the international markets where Company operates continued to be impacted by difficult market conditions. The political turmoil in Egypt and Bahrain continued and impacted demand. Bangladesh was impacted by sharp currency depreciation and a liquidity crunch in the market that has pushed up interest rates. The focus in the international operations of the group during the year was on strengthening position in the market place through initiatives to improve customer centricity, increasing the number of dealer tinting systems, introduction of new products, expanding the dealer network, increasing exports, focus on protective and industrial coatings segments and improving service level to minimize loss of sale due to stock outs. All these steps coupled with tight control on expenses and capital employed have helped the international operations of the group perform satisfactorily despite difficult market conditions. Sharp focus was accorded to further enhance safety standards in all subsidiaries. During the year, the subsidiaries in UAE and Trinidad were certified for ISO 14001. The revenue from paint sales of the overseas operations of the group for the year is ` 1138.6 crores as compared to ` 974.5 crores during the previous year. Material prices during the year saw an inflationary trend and profitability was impacted due to inability to take price increases commensurate with increase in material prices. The impact of inflation was mitigated to some

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extent by formulation re-engineering, economies of scale in purchasing and reducing losses in manufacturing. Profit after tax for the overseas operations of the group during the year is ` 72.3 crores as compared to ` 87.9 crores during the previous year. During the year, Asian Paints International Limited, Mauritius, a 100% subsidiary of your Company, declared its maiden dividend. The dividend received during the year amounts to US$ 3.4 million (equivalent to ` 15.8 crores) and royalty received during the year from overseas subsidiaries amounts to ` 15.2 crores. The revenue from paint sales of Berger International Limited, a subsidiary listed on the Singapore Stock Exchange has decreased by 1% to S$ 107 million (equivalent to ` 413 rores). The group operates in the following geographies:

2. ENVIRONMENT, HEALTH AND SAFETY:

Your Company has always been environmentally conscious and believes in resource conservation. Environment, Health and Safety (EHS) is one of the primary values for Company. The policy entails ensuring compliance tostatutory EHS requirements as the minimum performance standard and commitment to go beyond and adopt stricter standards wherever appropriate. Company focuses on pollution abatement, resource optimization and waste minimization, which leads to sustainable development. Priority and attention is given to the health and safety of employees. Training is imparted to all the employees to work as per the prescribed procedures meeting all EHS requirements. Company also endeavors to educate its customers and the public on safe use of its products.

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The Rohtak plant of your Company has implemented environmental management system and received the ISO 14001 certification. With this, all your Companys seven paint plants and the two chemical plants have the ISO 14001 environmental certification. All the seven paint plants and one chemical plant are Zero Industrial Discharge plants with rain water harvesting capabilities.

Khandala plant construction has begun and is progressing at fast pace. The design of the Khandala plant has world class safety facilities, Zero Discharge of effluents, water conservation, rainwater harvesting and green belt at the periphery of the premises.After achieving Zero Discharge of industrial effluent, minimization of waste through reduction at source and recycle/reuse has been a key focus area. This has resulted in reduction in specific generation of effluents and solid waste. Company also appreciates the need to monitor and reduce emission of Green House Gases (GHGs) which are responsible for global warming and climate change. Your Company has institutionalized a mechanism to monitor GHGs emissions across all business units as per Green House Gas (GHG) protocol [A Corporate Accounting and Reporting Standard by World Business Council for Sustainable Development]. GHGs emissions monitoring has been categorized under Scope 1 - Direct GHG emissions (due to fuel consumption) and Scope 2 Indirect GHG emissions due to electricity consumption (electricity bought from power generation companies) over which your Company has got direct control. Company has focused its efforts on enhancing energy efficiency in all its operations, right from the design

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of new manufacturing facilities. Company is participating in Carbon Disclosure Project (CDP) for disclosing information on carbon emissions.

3. HUMAN RESOURCES:
FY 2011-12 has been a year of consolidation for Human Resource function of Company. Several initiatives, which began in the previous year, started taking shape this year. Learnscape, People Review process and Employee Engagement are few such initiatives where noticeable consolidation over last years work were seen.While attracting and retaining talent continues to be a common challenge across industries in last few years, campus recruitment remains the most important source of getting right talent for Company. Therefore, in order to further improve Companys brand image at select campuses, initiatives towards increased industry-academia interface were focused upon. This in turn resulted in better quality talent attraction from specific campuses for Company. Customers are at the center of external interface, similarly, employees are the center of internal interfaces. In Company, several initiatives under Voice of Employeeagenda were taken up for implementation making a good beginning to responding to employee needs.

Inclusive participation and Inclusive growth is the core of any peaceful Industrial Relation. Building and working on comprehensive employee relations agenda has been an area of continued focus in Company. Accordingly,initiatives around Employee Relations and Engagement were taken up across all major manufacturing units.The formation of a new JV in the industrial business involved HR integration which included developing organization structure and policies to support the independent entity.A repertoire of courses available

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through e-learning is gaining momentum in Company which includes partnerships with reputed global organizations like Harvard Business Publishing and Skillsoft. These have received encouraging feedback from employees in Company.

4. CORPORATE SOCIAL RESPONSIBILITY

The Company has always been in the forefront of conducting various CSR initiatives for the benefit of the communities wherever it operates. These initiatives primarily revolve around Water Conservation, Healthcare, Education and Elderly Care. Company believes that growth in isolation is not enough; it believes in the concept of sustainable growth taking into consideration the society and environment at large. Water Conservation has been one of the key focus areas of Company for a long time now. Management of Water through Recycling and Reuse has helped in the conservation of this depleting natural resource. The Total Water Management (TWM) Centre located in the premises of Companys manufacturing facility at Bhandup, Mumbai has been championing the issue of water conservation. It plays the role of Information and Demonstration centre on water harvesting for the public at large. Various representatives from housing societies, corporates, government bodies and even school and college students have visited the centre to gain a holistic view on water management. Company has also participated in various seminars to advocate the cause of saving this fast depleting natural resource. Companys other manufacturing facilities at Ankleshwar (Gujarat), Sriperumbudur (Tamil Nadu), Patancheru (Andhra Pradesh), Kasna (Uttar Pradesh) and Rohtak (Haryana) have been doing their bit to provide healthcare to the elderly in the villages around the plant. Company operates Mobile Medicare Units (MMUs) in association with the NGO Help Age India to provide medical aid to the doorsteps of the needy senior citizens. Blood Donation and Health care camps are conducted on a regular basis for the benefit of the society by all the manufacturing plants of Company. Education is the foundation of progress and realizing this, most of Companys plants are working towards improving health and infrastructure facilities of schools in their vicinity. The Penta Plant located at Cuddalore (Tamil Nadu) has adopted a government higher secondary school in the village of Karaikadu in the nearby area. Maintenance of computers, providing furnitures and improving the existing sanitation facilities were undertaken by the plant. Additionally, Scholarships are also being provided to the deserving students. The plant at Rohtak was involved in providing filtered water and

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playground equipments to a primary girls school in Baliyana village. At Ankleshwar in Gujarat, Company is an active member of Ankleshwar Industrial Development Society, a trust which looks after Shree Gattu Vidyalaya, Shree Jayaben Modi Hospital, Mobile Education Van Project and Childrens theatre cum sports complexWhen the cyclone Thane struck Cuddalore and its neighbouring areas, essential provisions were distributed by the Penta plant to the cyclone affected villagers.

5. INFORMATION TECHNOLOGY:
There are four mega trends in the Information Technology(IT) world, shaping the way information is getting generatedand consumed today. These trends are Mobility, Social, Cloud Computing and Consumerization of IT. During FY 2011-12, Company has explored the impact of these trends and its relevance for your Company and deployed innovative applications around these mega-trends. A third generation cutting edge mobile application for the front line sales force of your Company was developed which will allow the territory officers to manage the dealer network efficiently by providing a 360 degree view of dealers. As this report goes to print, the application and associated devices are being rolled out pan India. Going forward the other customer facing roles of Company are also planned to be mobile enabled.The relevance of managing online reputation has gained immense significance in todays world. Company has already established its presence on popular social media platforms like Facebook and Twitter. To enable structured management of Companys online reputation, a social sentiment analytics tool was proto-typed and developed during FY 2011-12 , which can listen to opinions expressed by various consumers about Company and channel it to the Customer Relationship Management Systems.

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6. RESEARCH AND DEVELOPMENT:

The Company is executing an integrated strategy for technology development and deployment. The technology function is supporting Companys strategy around four missions: technology development, development of substantially new products, productivity improvement and cost reduction.

During the FY 2011-12, technology efforts have been focused on environmentally compliant technologies: 1. Water borne Acrylic Emulsion 2. Water borne Alkyds 3. High solids and 4. Low VOC solvent borne; VOC = Volatile Organic Compounds. The portfolio of projects includes leading edge technology for strengthening core business and overall capabilities.During FY 2012-13, Emulsions developed from Technology platform programs are expected to represent 20% of current total volume of emulsions. To meet the mid and long term strategic goals, focus will be in the area of developing paints with reduced VOC.

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ACHIEVEMENTS AND AWARDS & RECOGNITION

Asian Paints has been included in the Forbes magazine's - Asia's Fab 50 List of companies once again. This is the second time that Asian Paints has been included in the coveted list.

In Feb 2012, Asian Paints wins the Asian Centre for Corporate Governance & Sustainability awards for the BEST GOVERNED COMPANY in 2011 Asian Paints included in Asia's Fab 50 List by Forbes Asia Magazine (Sept 2011 Issue) Asian Paints ranked 13th amongst the top paint companies in the world by Coatings World - Top Companies Report 2012 (July 2012 Issue) Mr. P M Murty, MD & CEO, Asian Paints conferred upon the 'CEO of the Year' award by Business Standard, one of India's leading business daily (March 2011) Asian Paints receives the Best Audit Committee Award from the Asian Centre for Corporate Governance & Sustainability (Feb 2011) 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.

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.

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1. Type of Channel Channel Construction material builders hardware Others Response 60 30 60 0 % 40 20 40 0

40 35 30 25 20 15 10 5 0 Construction material builders hardware Others

InterpretationThrough the above diagram we can know that out of 150 outlets how many outlets are construction, builders and hardware outlets. Thus we can conclude that 40% outlets were hardware, 20% were builders,40% were construction material outlets.

2. Type of Outlet

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Outlets NAROLAC Asian Paints Both Asian Paints and Nerolac Paints OTHERS

Response 30 30 30

Percentage 20 20 20

60

40

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4. Level of satisfaction on Communication From the Company

Level of satisfaction Responses Percentage

Highly satisfied Quite satisfied Neither satisfied nor dissatisfied Quite dissatisfied Highly dissatisfied

18 57 24 39 12

12 38 16 26 8

InterpretationThrough the above diagram we can know the level of satisfaction on communication from the company. Out of 150 outlets,18 are highly satisfied,57 are quite satisfied,24 are neither satisfied nor dissatisfied,39 are quite dissatisfied and 12 are highly dissatisfied

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5. What is done if a brand which preferred is not delivered properly?

outcomes Responses Percentage

Go for other brand Call to distributer Call to companys sales person Stop selling that brand Other outcomes

96 0 39 15 0

64 0 26 10 0

InterpretationThrough the above diagram we can know what the retailers do if a brand they prefer is not deliver to them. Out of 150 outlets, 96 of them go for other brands, 39 of them call to the company`s sales person and 15 of them stop selling that brand.

6.Promotions that affect the brand mostly

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promotions

Responses

Percentage

scheme Case refund Price pack Home Painting Guide Any others

63 21 12 54 0

42 14 8 36 0

70 60 50 40 30 20 10 0 scheme Case refund Price pack Home Painting Guide Any others

Interpretation:Through the above diagram we can know the promotion that affect brand mostly. Out of 150 respondents 63 replied schemes, 21 case refund,12 price pack and 54 under crown scheme.

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7. Effect on sale of ASIAN PAINTS(in festive season).

Effect Increase Decrease No effect Cant say Response 21 18 66 45 Percentage 14 12 44 30

InterpretationThrough the above diagram we can know the effect on sales in the occasions of festive season( peak seasons). Out of 150 responses 21 said that the sales increase, 18 said that the sales decrease, 66 said that there is no effect on sales on festive and 45 did not answer.

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8.Effect on sale of ASIANPAINTS. (In non festive season)

Effect Increase Decrease No effect Cant say

Response 42 15 69 24

Percentage 28 10 46 16

InterpretationThrough the above diagram we can know the effect on sales in the occasions of non festive . Out of 150 respondents 42 said that the sales increase, 15 said that the sales decrease, 69 said that there is no effect on sales on non festive seasons and 24 did not answer.

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Findings

1. It is felt that outlet owner are more concern about schemes like offers on cases,and promotional schemes etc and nerolac is providing them better schemes than asian paints. 2. It is felt that distributor is not doing his work honestly, he is not sending route in the market properly. When the salespersons generate orders with retailer, due to problem like salesman is on leave, vehicle is not available etc they delay the order and retailer cancel the order with the distributer that affects the sales volume. 3. Distributer is more concern about Wholesaler rather than Retailer.

4. The distributor in its area is facilitating sales by establishing monopoly of offers and schemes that do not reach to the outlet. 5. Due to infiltration, difference in the rates for the shopkeepers has been perceived as a major problem in the market. 6. Distributor rarely keeps any interest to work and communicate with the customer which results in of the companys sales as well as image are getting adversely affected.

7. It has been found that the shopkeepers has strongly responded to the option of switching to the another brand, when it has been inquired that what will they do in order to continue trading at the time when their preferred brand is not been delivered properly

8. The shopkeepers have nodded to the view that schemes offered to them as per the policies of the company plays a significant role in increasing profitability. As per the notes taken apart from the data in the questionnaire it has been discovered that nerolac offers more schemes to the shopkeepers who are vindictive for the company.

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9.. Some outlets are maintaining old price strips and also these are not easily visible to the customer.

10. I found that some retailer were not satisfied with our service, for that reason they stopped to sell our product and started to sell nerolac product.

11. I found that nerolac is doing aggressive advertisement in comparison with asian paints, and investing aggressively on activation like hording, glow sign board, also in terms of providing good service and free advertising equipment to the retailer.

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Company should convince retailers to have promotional tools decorating with Asian Paints products and should tell them why these elements are important and how company as well as Retailers is getting benefit of using these activation elements. Company should focus more and more on builders because most of the builders dont have promotional tools of the company and overall average score of these is very less. Company should reframe the Flange to an attractive and big size because the current look and size of Flange is not attractive and fail to draw attention of the population. Overall service should be improved because many of the retailers are not satisfied with company service. Company must provide free promotional equipment to the outlet where needed and also company should work out on the complain of Retailers. The Company should measure Retailers satisfaction regularly and should maintain proper communication with them. Company can increase the sales when it considering more on retailers, their suggestions or complaints about service or product so that necessary action can be taken. Review meeting should be often held so that the working pattern of the executives can be checked and improved if needed. Company representatives should visit retailers and should make a long-term relationship with retailer so that they can push the product. Distributers should be convinced to pass the incentives to the retailers so that they aremotivated to promote this brand. Increase the number of dealers and retailers as this will help in making high sales volume.

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In Season Company should give more discount & schemes to retailers so that they sell more our product.

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Conclusion
No other company is planning to increase its capacity in the near future; this will give Asian Paints a competitive advantage in terms of pricing.

Growth rate of two important activities i.e. repaints activity and construction activity will have direct impact on the volume of demand, thus affecting its profitability and margins. Rural markets have devloping potential. Companies that can establish a dealer network in these markets are likely to get the edge in positing above par growth rates over the next few years.

As setting up distribution infrastructure is expensive, it would mean that the competition is limited to the top players. Due to substantial hike in raw material prices, Asian Paints has raised the prices of solvent based paints, thus demand would be affected to some extent.

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BIBLIOGRAPHY

1. Nargundakar- Marketing Research (All India Traveler Book Sellers) 2. Malohotra,Naresh K. & Das, S.- Marketing Research (PEARSON)
3.

Information from www.asianpaints.com.

4. Anonymous, How to decide who should get what data, H.R.Focus(May 2001)
5.

Thorburn, David and Jenkins, Henry (eds)(2002). Rethinking Media Change, MIT Press, Cambridge, Massachusetts, pp.283&284.

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Appendix- A (sample questionnaire)

I am Abhay Kumar a student of I.E.T Lucknow undertaking a summer project on the topic Analysis of Horizontal Expansion Strategy of Asian Paints Pvt Ltd. I would like to see your views andopinions on the same. Could you kindly spend a few minutes helping me complete this questionnaire?

Personal information
Name:Area:Mobile no.:(1) What Type of Channel do you hold? a) construction material c) builder b) hardware d)Other,Please specify .

(2) What Type of outlet are you in? a) Nerolac Exclusive c) Never sell oil and apints b) Asian Paints Exclusive d) Both a & b

(3) What is the promotional equipment you are using? a) Glow shines board c) Own yourself hoardings e) Both (A & B). (4) Kindly rate the level of satisfaction on Communication from the company a) Highly satisfied c) Neither satisfied nor dissatisfied e) Highly dissatisfied b) Quite satisfied d) Quite dissatisfied b) Hoardings d) Banner

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5) If a brand which you prefer is not delivered to you properly, then what do you do? a) Go for other brand c) Call to companys sales person b) Call to distributer d) Stop selling that brand

e) Other actions, please specify __________________________________________.

(6) Which of the following promotions affect the sale mostly? a) Scheme c) Price pack b) Case refund d)Home Painting guide

j) Any Other, Please Specify ____________________________________________.

(7) I. Is there any effect on sale of ASIAN PAINTS in festive season? a) Increase c) No effect b) Decrease d) Cant say

(8) Is there any effect on sale of ASIAN PAINTS in non-festive season? a) Increase c) No effect b) Decrease d) Cant say

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