JSW Steel

Case

Sales and Distribution Management

1. Situation Analysis (JSW vs Competition, why should manufacturers shift to
retail channel)
Traditionally like other B2B products in the Indian market the business of steel was
also mainly between manufacturers and dealers. Maintaining a healthy and a good
relationship with the dealers played a vital role. The dealers were not proprietary
dealers and would stock other competitors products as well. Hence the steel
traditionally did not have any built in differentiation with respect to brands.
The reason for steel manufacturers to move to a retail model are as follows The traditional business required dealers to source the product from the
manufacturers in bulk orders. The retail model would allow the dealers to
serve as partners and reach the B2C market.
Steel was made in many differing varieties. With this array of options it was
possible to introduce differentiation.
The new model will increase the customer involvement and also build a brand
image. It will also educate the customers of the various products available for
a task.
2. Issues from dealers perspective on JSW Shoppe.
JSW Shoppe's major issues as projected from the dealer's side are as follows:
Dealers were skeptical of the intentions of the firm. They felt that in the long
run they might be kicked out of business.
They Dealers were not very comfortable with using the MIS system as
proposed by JSW.
Dealers were not comfortable with JSW's interference in their daily
operations.
The customers were recently facing a problem of not receiving the
customized orders.
The firm was dumping it's high end products. These were not easily sold by
the small dealers leading to pile up.
3. Issues from companys perspective on JSW Shoppe.
JSW Shoppe's major issues are:

Dealers were also running parallel shops and outlets

The company prescribed shop environment was not adhered to by dealers
The dealers were not training the staff
Dealers were using executives for unskilled work leading to unsatisfaction
Inappropriate use of Business Development Activity funds
The IT systems were not being updated regularly by the dealers
There were no ways to measure the dealer performance

Sales and Distribution Management

4. Work out a revenue model for the JSW Shoppe assuming that you are
the branch head for JSW trying to convince a dealer.

5. How should the company promote its products to help propagate the
idea?
The JSW was trying to market a traditional B2B product as a B2C product.
Therefore they were to follow unconventional marketing strategies. They were
following the "JSW on Wheels" campaign to improve awareness amongst the
end customers. Following strategies can also be implemented to improve the
JSW shoppe1.
2.
3.
4.
5.

TV ads showing usage of JSW steel

Sponsor sporting events
Take up CSR activities
They should advertize in Social Media and Content Blogging
Come up with campaigns that convey the values of JSW

Sales and Distribution Management