RAJ MINERAL WATER COMPANY
Submitted by:- RAJIV RANJAN
ASHUTOSH MISHRA
Our vision: To be the dominant player in the branded water business where the second player is less
than 20% of our business.´
MISSION : We are in the business to serve the customer. He is the most important person. He is the
only one who pays. He deserves the best quality and presentation at a worth of the price. We must
have world class quality, at the lowest production & distribution cost. This will make us an
unbeatable leader, and will have satisfied loyal customers.´
VALUES Integrity, Leadership, Teamwork, Co-operation, Quality, Passion, Openness and
Transparency.´
VALUE CHAIN ANALYSIS
INBOUND LOGISTIC: The company will receive the machine
for extraction of groundwater, packaging and labelling from
specialised vendor. It will also ask for water from state
municipality and for purification it will outsource for short
term period and then will purchase the equipment.The
packeaging plastic will be purchased from local
manufacturer.There will be own transportation system
comprising of mini truck and cargo truck.
OPERATION: About 50 worker will be engaged in production
of ground water ,purification and packaging.
OUTBOUND LOGISTIC: For every 100 shop there will be one
mini truck and thus 12 mini truck will be required initially.
Marketing and sales: For physical distribution of water bottle
,there will be own shop every 200 metres.Target is to open a
total of 1200 mini shop. For every 100 shop there will be one
big shop that will act as store house for mineral water bottle
supplying water to these mini shop. For every 100 mini shop
there will be one local manager and two business
development manager that will look for opportunity in the
market and will look for customer. Thus a total of 12 local
managers 24 BDM will be required. For advertising we will
sponsor sports event, will open small outlets at station
showing the comparative benefit of cost .All BDMs will serve
as promotional team with one brand promotion head.Price
of a mineral water bottle is Rs 8.
SERVICES: For every customer we will provide one
pencil/pen worth Rs 1.There will be a service department
looking for the scope for finding best way to delight the
customers.
PORTER’S MODEL
Threat of entry: As the number of Bottled packaged water
consumption is increasing in all over the world, the
opportunity for other players in increasing rapidly. In the
bottled packaged industry the entry barrier is low. The entry
barrier is low due to local low production cost, less amount
of capital, easy to access government and legal law, local
production law, less legal and government barrier and low
switching cost. The existing brand in beverage industry is
paying attention and moving into bottled packed water, as
they have good brand image and the opportunity is very
huge in this industry. Eg.Pepiso coca cola According to
industry life cycle the bottled packed industry is at mature
state and the most of the market is covered by the Bisleri,
Aquafina, kinley and Ozone. So the pressure for new entrants
to capture the market is very high. But according to still there
are many local player that covered the 26% of the market.
But when we observe the product on differentiation the
different among product is very less or equal lent to nil.
According to product differentiation the threats of entrants is
high. But the overall threat of new entrants is medium.
Bargaining power of suppliers: The bargaining power of
supplier is low, as the suppliers include municipal water
system, bottles and plastic cap, label printer filtration and
deionization equipment, plastic grains and etc. Sometimes
the bargaining power of suppliers is depends on geographical
location and the technology adopted by the organization. The
recyclable bottle used by the company needs advanced
technology or some dependant, like other packaging industry
as the packaging cost is high. But the large availability of
suppliers leads to less bargaining power. The bargaining
power of supplier may include the inventory stock of bottles.
Overall bargaining power of supplier is less.
Bargaining power of buyer: As the bottled packed water
industry comes in oligopoly industry. The no of producer is
less thus the bargaining power of suppliers is less. The
bargaining power of buyer is depends on the price and
product. The availability of product also affects the
bargaining power of buyers. Availability of substitute is also
affects the bargaining power. As the competition is not much
high, there are mainly five to ten producer like Bisleri,
Aquafina, Kinley, Oxyrich and Pure life so the customers do
not have any advantage moving from one brand to other
brand. The product differentiation is almost zero, so the
bargaining power of customer is low.
Sometimes it depend upon the geographical location,
segment of consumers both rural and urban population,
consumer buying behavior and consumer preferences.
Substitute product: The availability of substitute is coffee,
soft drink, juice and tea. The substitute of product affects the
price and market. The availability of substitute provides the
option to customer and customer can switch from one
product to other. The beverage industry is always
appreciated by every country. The availability of various
health drinks, juice, carbonic and no carbonic drinks and
availability of taste changed the consumer preferences.
Consumer is using various health drinks, carbonic and non
carbonic drinks to quench the thirst.
The total size of food industry in India is almost $ 65.6 billion
and soft drinks (juices and carbonated beverage) contain $ 1
billion. Indian soft drink market consumption in a year is 284
million crates. Soft drink market is highly seasonal in nature,
consumption in during offseason is 15 million crates and in
peak season is around 25 million crates per month. In urban
area Consumption of soft drinks is 75% of whole Indian
market. Indian soft drink market is dominated by
multinational companies Coca-Cola and PepsiCo. In India
mineral water market is $50 million and 65 million in crates.
The monthly average consumption of mineral water is 4.9
million crates that increase in peak season to 5.2 million
(Non-alcoholic beverage market in India, 2009).
So we can draw that the bottled packed water consumption
in India is one third of the total beverage industry. Rivalry:
The degree of rivalry and the competition affects the price,
quality, profit and revenue in an industry. As the market is
almost on saturation state, and the industry refers the
oligopoly competition so there is a high competition to
increase the market share. The market is dominated by the
very few players like bisleri(%), aquafina(%), kinley(%) and
oxyrich, and they are trying to increase their market share by
product introduction, price, packaging and volume of water.
As there is no much difference among the product by
different competitor, the rivalry is only in terms of service
and of marketing strategy. The intensity of rivalry is low as
there is limited player and the product is not price sensitive.
According to Indian beverage association the market will
grow by in 2012 , the market shows the high growth rate so
the competition is less.
SWOT
ANALYSIS
Strength
y
Extensive range of products
AMRIT is providing a wide range of products to pull all types of customers. E.g. twelve litres and twenty
litres of bottle are for organization¶s purpose and 500 ml and one litre is suitable for individual purpose.
High quality standard
.
Marketing . It is using print and electronic media for its marketing and hoardings at the point of sale to
supports their TV advertisements. For example vehicles are painted in light green with logo of Amrit easy
punchline as ³drink and drive´
Increasing popularity
Distribution channels
Amrit will open eighty thousands outlets in India in next five year . It distributes products directly to its
own shop through its large fleet of truck by using a system known as route selling in which truck driver is
trained as a service man. Th is helps in maintaining the freshness of water and shape of bottles.
The safety seal
In order to deliver the quality product to the customer every bottle of Amrit will be sealed with a unique
cap which is patented and cannot be replicated. This is a technical strength of the company which
guarantees that customer will get product of standard quality not duplicated.
Weaknesses
Reusable bottles
Government pressure
Unable to fulfill the demand of the customer .
Opportunity
Field growing at rapid pace
Water seems to be the best beverage for India in the upcoming time period. In last several years, it has
been indicated that drinking water market has shown high level of activity with several new competitors.
The worth of the bottled market is expected to be increased from Rs.1000 crore to Rs.5000 crore by 2010.
Effective utilization of distribution chain
It is becoming a generic name for mineral water and if company can use the distribution channel in order
to provide the product to place where consumer require it most then company can gain more success in this
field. This company can establish good relations with dealers and other distributors to market the product
all across the world.
.
Alteration
of image
The company has changed its colour from blue to green and by doing this company has offered a
new product to the customers and they will enjoy a fresh product.
Increasing production
The company is focusing on the market and looking forward to increase the production by
establishing new more plants. It will enhance the capacity of production of the company.
Threats
Entry of big players
The market growth is showing that the demand for the mineral water is increasing. Therefore, big players
are focusing on the market; players like,Bisleri Pepsi, Coke, Britannia and nestle are curious to increase
their stakes in the market. Due to the tough competition between Pepsi and Coke, BISLERI can be
dissolved.
Entry of new players
New players are entering the market in order to capture some shares. Some of the players like
Tata-Tea and Godrej are looking forward to launch their product and this will heat the
competition. There are some other brands like EVIAN, ATCO, BRILLIAN water, DS FOODS are also
looking forward to launch their products. Hindustan lever is also looking forward to launch its product in
the product and this will lead to a tough competition.
Water filter manufacturing companies
It is facing competition from water filter manufacturing companies like Eureka forbes. They are
marketing their product in the market which has reduced the sales volume of bottled water.
Unauthorized manufacturers