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INTRODUCTION
JSW Manufacturing plant producing steel pipes, bends and sockets
One of many low-cost steel producers in the world and favored bulk buyers
April 2007 : Location Marketing Headquarters in Mumbai
People Attended - Jayant Acharya (Director Marketing), Sharad
Mahendra (Vice-President) and marketing team
Agenda - How to boost the presence of Jindal Steel Works steel in
the
market
Result - Development of an organized retail format
COMPANY BACKGROUND
Founder OP Jindal established a manufacturing plant near
Kolkata
1952 Production of steel pipes, bends and sockets
Multi-billion dollar, multi-location and multi-product
business empire
2010 Manufacturing faculties across India, US and UK
Range of Products and services :
Mining iron ore
Manufacturing carbon and value-added steel
Cement
Power and industrial gas
Providing port facilities
COMPANY BACKGROUND
(contd.)
PR JINDAL
SAJJAN JINDAL
RATAN JINDAL
JSL Ltd.
PT Jindal Stainless
JSS Steelitalia Ltd.
Jindal Stainless Steelway
Ltd.
Austenitic Creations Private
Ltd.
Jindal City Infrastructure
Ltd.
Parivartan City
Infrastructure Ltd.
NAVEEN JINDAL
COMPANY BACKGROUND
(contd.)
THE IDEA
Keeping the branding of Tata Steel and Essar Steel in mind Mahindra had two primary
decisions to make : should the company venture into retail on its own or
should it collaborate with the existing dealers?
Cost Analysis Conclusion - It would be extremely expensive for the company to
venture into retailing on its own
With 160 dealers he needed to choose a model that would be suitable to all kinds of
markets and could be easily replicated in all regions of the country
Dealer's perspective
Dealers were sceptical that company wanted to do away with
dealers in long run
Standardised materials provided (Companys response steel
service centres)
Growing interference in day-to-day affairs, also due to inclusion
of MIS
Forcing to sell all products and expand stock with new products
(Companys response need to maintain brand value therefore
uniformity across all shoppes)
Companys rationale
Strategically targeted new
generation dealers
Company claimed that
competing dealers also existed
earlier
Proposed to adopt balanced
scorecard evaluation criterion
Dealers perspective
No proper evaluation criterion
Allotting dealerships in close
proximity, which cannibalized
their sales
Sceptical about the very idea of
attracting end consumer
Suggestions:
1. JSW need to make proper balance between dealer distribution supply and Shoppe
distribution supply.
2. JSW needs to implement a strong distribution network in growing cities.
3. JSW need to establish their branding most powerful and separated for effective
supply chain management