Summer Training Project

Title: Analysis of Marketing Mix of Ram Lubhaya &Sons (Ralco)

Under Guidance of: Mr. Sartaj Bajwa (Faculty, PCTE) Presented By: Taranpreet Kaur Mba-2(A)

COMPANY INTRODUCTION
 Ralson today stands tall as India's largest company in the field of bicycle tyre industry.  Location: Ralson Nagar, GT Road, Ludhiana.  Led from the front in 1974 by Mr. Sanjeev Pahwa Chairman-Cum-Managing Director, under the name Ralson Cycle Pvt. Ltd.  1982: name changed to Ralson Cycle Pvt. Ltd.  1985: Ralson India Ltd.  In 2003 a new plant was set up at Doraha for manufacturing automobile tyres.

 Company's turnover has shot up to 500 crores in 2009.  Presently company is producing: 1. 1.25 Lac tyres & 1.50 Lac tubes per day for bicycles 2. 1 lac tyre, tubes per month for automobile tyres.  It currently has workforce of about 5000 workmen.  Distribution network: 31 branches ,13 consignee agents and 8000 dealers spread all over India.

 Ralson is the first Bicycle Tyre manufacturer in India to be accredited with an ISO 9001:2008 Certification,.  It provides the widest possible range of tyres & tubes ensuring that customer aspirations are always and fully met.  It has full fledged R&D Lab. Equipped with most sophisticated testing equipments, duly approved by Central Govt. of India.  Ralsons proactive R & D department fuels momentum for growth by continuously developing newer sizes and designs.

 Ralson worldwide Export activity is also developing very quickly.  Ralco exports are already enjoyed in Europe, South & Central America, South East Asia, Gulf, Middle East & African Continent.  Ralco auto tyres have been developed keeping in view durability, grip & ruggedness in mind, allowing Riders to race or ride confidently both on & off-road.

SWOT ANALYSIS

STRENGTHS
 Company has a very comprehensive quality policy which ensures the production of best quality products.  Its a cash reach company i.e. company is 100% internally financed. The amount of borrowed funds is very less.  Company is having big production base (in case of bicycle tyres) in India company is producing 100000 tyres, 150000 tubes and 20000 hubs every day )

 Wide distribution network throughout the country.  Companies are having the biggest R&D facility in the industry. And its R&D department is recognized by Department of science and technology, GOI.  Company has employed best of the technologies since its inception. It has adopted SAP system since April 2001.  It has recently become the first company to make cycle tyres conforming ISI standards.

WEAKNESSES
 Lack of advertisement support
 Lack of market research.

THREATS
 Most of the labor in company comes form states like U.P. and Bihar. Due to the industrialization in these states, company is facing acute shortage of labor.  Labor turnover is very high.  Increase in prices of raw material e.g. rubber.  Expensive power and labor.  Incoming of foreign products and technologies, eg. Chinese tyres now-a days which are much cheaper.

OPPORTUNITIES
 There is a huge untapped demand for Ralson tyres in domestic market.  Because of globalization, many opportunities for exports have also opened up.  Company is also having huge opportunities in other similar segments like auto tyres as it can enter car tyres segment.

Marketing Mix of Ram Lubhaya & Sons

PRODUCT
Two wheeler tyres Three wheeler tyres E-bike tyres LCV tyres(Light Commercial Vehicles) ADV tyres(Animal Driven Vehicles) Tractor Tyres

PRICE
 Ralco practices cost based pricing.  Ralco prices its products according to the cost incurred on

manufacturing.
 After determining the cost, a certain fixed level of profit is

added to calculate selling price.

 Therefore the reson why prices of Ralco tyres fluctuate

according to increase/ decrease in price of raw materials.

PLACE
The distribution channel of Ralco caters four markets. Viz.  Export  Branch networks  OEM: Original Equipment Manufacturing  Consignee agents
 Levels of Distribution Channel:  Zero Level Distribution Channel  PRODUCER----------------------- EXPORT AGENTS  Three Level Distribution Channel  PRODUCER---- BRANCH---- WHOLESALER----RETAILER--- CONSUMER

 Zero Level Distribution Channel  PRODUCER--------------------- OEM  Three Level Distribution Channel  PRODUCER---- CONSIGNEE- WHOLESALER-RETAILER--- CONSUMER AGENT

PROMOTION
Promotion Mix of Ram Lubhaya &Sons

Participation in Trade Fairs(Auto Expo, Delhi)

Joint Promotional Schemes(JPS)Like calendars, t shirts, wall paintings, clocks, tyre stands, tin/plastic plates etc.

TV Advertisements in South India

Print Advertisements in newspapers and magazines(Bike India)

NEED OF STUDY
 Ralco Auto Products is a comparatively new venture of Ralson India Ltd. This study can help the marketing department to know the position of Ralco Auto Products in the market amongst its competitors.  The results of position analysis of Ralco amongst competitors can help the company to know how far it needs to come in order to stand amongst the industry leaders.  To know the perceptions of the Auto dealers in Ludhiana and Patiala about the marketing mix elements of Ralco auto Products.  To help Ralco improve its marketing mix or continue with the

OBJECTIVES OF STUDY
 To study the various factors affecting purchase preference for any auto tyre.  To study attributes of Ralco products viz product quality, price and design.  To study effectiveness of promotional tools used by Ralco.

RESEARCH METHODOLOGY
 Research methodology is a way to systematically solve the research problems.  In it we study the various steps that are generally adopted by a researcher in studying his research problem along with logic behind them. Research design:  The research design for this research is descriptive or ex-post facto research.  It means reporting exactly what has been foun without any further processing or deductions from data.

DATA SOURCES
 This research involves both primary and secondary sources of data collection.  The primary information has been collected from auto tyre dealers in the form of Schedules.  The secondary information was gathered from various company manuals, annual reports, websites and journals.

Research Instrument: Schedules  In this study, each Auto tyre dealer was approached individually and asked the questions written in the schedule. If dealer didnt understand something, it was explained and then responses were noted down. Population :  Population refers to part of universe from which the sample for conducting the research is selected.  The population for this study is finite i.e. all dealers of auto tyres in Ludhiana and Patiala. Sampling unit:  Sampling unit refers to smallest possible individual eligible respondent. In this study the sampling unit is the individual Auto tyre dealer.

Sampling size  This refers to the total number of respondents selected from the universe to constitute a sample. The sample size of this study is 50. Sampling frame  Frame is the list of respondents i.e., list of all Auto tyre dealers in Ludhiana and Patiala Sampling technique: non probability convenience.  This sampling method has been mainly chosen because of lack of time, lack of my knowledge of tyre dealers in city, difficulty in approaching very far off dealers and lack of expertise.

LIMITATIONS OF STUDY
 The research done is in a limited area only. The study represents Ludhiana and Patiala market situation only. Whereas the company operates not only throughout India but also abroad.  Although there are numerous auto dealers in the two cities, but sample size is limited to 50.  Some dealers may have rendered wrong information about the product either because of lack of knowledge or due to some personal grudges with company in the past i.e.biased nature of the respondents might have crept in while conducting the research.  Some big wholesale dealers or even some retailers of city refused to respond because of rush of customers at the shop. Their response could have been really useful.

DATA ANALYSIS AND DISCUSSIONS

4.1 Status of dealership

Table 4.1 No. of Respondents Wholesalers Retailers Both Total 21 13 16 50 Percentage 42% 26% 32%

4.2 No. of dealers selling each of different companies tyres

Table 4.2 No. of Responses MRF Dunlop t R lco Oth rs 42 40 9 20 22 Percentage 84% 80% 78% 40% 44%

4.3 Share of sales of each companies tyres out of total sales

Table 4.3 Contribution to total sales (in % units) 1 50 1145 1000 460 445 50000 Percentage( %) 3 22. 20 .2 8. 100 Position

MRF Dunlop Ceat Ralco Others Total sales

1 2 3 4

4.4 Maximum selling Product according to dealers

Figure 4.4(a)

Figure 4.4(b) Maximum selling product for other companies tyres

4.5 Rating of tyre designs of Ralco

Table 4.5 No. of Contribution Mean Respondent Score s 0.82 3 6 38 6 3 38 0 -3 0

Very good(2) Good(1) Average(0) Poor(-1)

Very poor(-2) 0

4.6 Product Quality of Ralco tyres

Table 4.6

Contributio Mean No. of Score Responden n ts 0.52 Very good(2) 2 4 Good(1) Fair(0) Poor(-1) Very poor(2) 28 14 6 0 28 0 -6 0

4.7 Prices of Ralco compared with that of competitors

.7 No. of Contribution Respondents Mean Score 0.72

Very good(2) Good(1) Fair(0) Poor(-1) Very poor(-2)

5 21 24 0 0

15 21 0 0 0

4.8 Reasons for preferring other companies products over Ralco

Figure 4.8

4.9 Ranking of various factors affecting generation of demand for a particular brand of tyre (most important-1, least important-4)

Figure 4.9

4.10 Availability of Ralco Tyres in market

T l . 0 No. of Contributio Respondent n s Available with almost every dealer(1) Available with few dealers only(0) 0 0 Mean Score

-0.62

Available 31 with very few dealers(-1)

-31

4.11 Tools of promotion used by Ralco which are known to dealers or seen sometime by them.

Figure 4.11

4.12 Most effective media for promotion of Ralco Products

Figure 4.12

4.13 Attributes of Ralco product that needs improvement

Figure 4.13

CONCLUSIONS
 Majority of the auto tyre dealers sell multiple brands and not a single brand at their outlets.  The tyres of MRF, Dunlop and Ceat are available with most of the dealers in market while Ralco Products are available with less than half the number of dealers.  On same lines, comparing the market sales of MRF, Dunlop, Ceat and Ralco, MRF is the leader followed by Dunlop, Ceat is at number three while Ralco being at fourth position.  The maximum selling product of Ralco out of its product range is the two wheeler tyre i.e. two wheeler tyre is generating maximum sale out of all the products.

Promotions:  Awareness of promotional tools used by Ralco is pretty low in market.

 Company salesman approach is the most effective of all the promotions carried out by Ralco since maximum dealers are aware of this promotional tool.  Joint Promotional Schemes are also known to some dealers but overall awareness of promotional tools is low.  Most of the dealers think that TV advertisement can prove to be the most effective promotional tool if used by company.

 The dealer network of Ralco in the market is very limited according to most of the dealers. That is why the availability of Ralco products is low in the market.  The dealer study reveals that the dealers prefer other companys tyres over Ralco because of customer demand for other brands. This means the brand awareness for Ralco amongst the customers is very low as compared to its competitors.  The study reveals that price is the most important factor in generating demand for particular brand of tyre in the market. Awareness of brand amongst customers is second most important factor, quality being third and tyre dsign being least important.

A study of following attributes of Ralco revealed that : Tyre Designs: The tyre designs of Ralco are most satisfactory to dealers out of the three attributes studied. The tyre designs are nearly good. Product Quality- The product quality is a little less satisfactory than tyre designs as it has been rated exactly between fair and good. Prices- The prices of Ralco are rated slightly above that of competitors

Study of attributes of Ralco products viz. price, design, quality

SUGGESTIONS
 Since the customer demand is very low for Ralco , it mainly needs to improve on its promotional tools in both volume and frequency.  Being new in market as compared to competitors, Ralco should make efforts to popularize its brand name in market. This means creating more brand awareness amongst consumers which can be done through promotions.  Company should increase its dealer network in order to enhance the availability of product in market.  Company can offer lucrative deals to the dealers eg. slab discounts, etc.so that more dealers are attracted to buy Ralco product and hence dealership network of Ralco can be enlarged.

 Also this will increase the availability of product in market., By offering good deals to dealers, Ralco can also increase its sales because dealers will encourage volume sales of Ralco to earn more profits for themselves.  The company still has huge scope of expansion as for example, entering car tyres segment or even expansion in currently operating segments is possible because demand is exceeding supply in this industry.

Schedule
Analysis of Marketing Mix of RAM LUBHAYA & SONS
Q1. What type of business you deal in? Wholesale Retail Both

Q2. Which out of these companies Auto Tyres do you sell?  MRF  Ceat  Dunlop  Ralco  Others (Please Specify) Q3. Considering your total sale to be 100%, what is the share of each of the listed companies sale of auto products out of 100?  MRF  Ceat  Dunlop  Ralco  Others

Q4. Which segment of Auto Products (Ralco) do you sell in maximum volumes? 1.Two wheelers 4. LCV 2.Three wheelers 5. ADV 3.E bikes 6.Tractors Q5. How would you rate tyre designs of Ralco Products? Very good Good Average Poor Q6. How would you rate Ralco in terms of Product quality? Very Good Good Fair Poor Very Poor

Very Poor

Q7. How would you rate the prices of Ralco compared to competitors? Very high High Competitive Low Very Low Q8. What are the reasons that you go in for companies other than Ralco?  Better margins  Customer demand  Better quality

Q9. How important are these factors in generating demand of a particular brand of tyre in market? (1- most important, 4-least important)  Price of Tyre  Design of Tyre  Quality Of Tyre  Awareness of brand amongst consumers Q10. What is your observation regarding availability of Ralco tyres in market?  1. Available with almost every dealer  2. Available with few dealers only  3. Available with very few dealers Q11. Which of these promotional tools of Ralco have you come across till date?  Print advertisement  Hoardings  Tyre Stands, Calendars, Etc.(JPS)  Company Salesman approach  None

Q12. Which tool do you think can be most effective for promotion of Ralco?  TV ads  Hoardings  Print Advertisements  Joint promotion schemes Q13. Which attributes of Ralco Auto Products need improvement?  Product Quality  Pricing policy  Promotion  Replacement policy  None