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Case Overview
MPIL was setup for improving the distribution in South MPIL is losing its market share in North Karnataka Solely dependent on Bangalore Metal Trader for distribution in Karnataka
Metal Industry
Complete market size of 40,000 metric tones (MT) Annual growth rate of 6 percent Major Players
Karnataka Metal Sections (KMS) Adarsh Metals (AM) Mahavir Metal Sections (MMS)
Characteristics Of Environment
Previously MPIL was market leader in south India Environment was favorable for MPIL Business was attractive New entrants increased the competition
Market Structure
Bangalore Metal Traders (BMT) was largest dealer in South India with off take of 2000 MT per annum BMT had more than 50% of market share in Karnataka Transactional Relationship/Mutual Understanding
MPIL didnt appoint dealers at other centers in Karnataka BMT didnt dealt with other manufacturers
Recommendation
MPIL should not solely depend on BMT
MPIL should promote their product through hardware dealers to capture the market of north Karnataka Restructuring of discount in interest of sub dealers Applying condition to deal only with MPIL products Assigning of new dealer in different areas of south India
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