A PROJECT ON RAYMOND STRATEGIC MANAGEMENT

BY: Mr.MANOJ DIWAKARAN

M.COM (FIRST YEAR)

TABLE OF CONTENTS Executive Summary 1. Definition of Strategic Management 2. Raymond Company history 3. Industry structure 4. Environment 5. Products 6. Price 7. Distribution Network 8. Promotion 9. SWOT analysis 10. Suggestions Appendix

Executive Summary The purpose and scope of the project is to study, analyze and understand the business and marketing practices of Raymonds . In order to achieve this objective two stages were identified-Data collection stage and the Analysis stage. The first stage includes the data collected from various sources regarding the following: 1. The history of the company, its subsidiaries, the board of directors, Operation Units in India. 2. The closest competitors in the textile industry-Bombay Dyeing, S Kumars, Zodiac, Arvind Brand, Triggers. 3. Information about the 4 Ps of marketing-Product, Price, Place and Promotion The analysis stage includes understanding the implication and relevance of the data collected and drawing conclusions about the companys business and marketing decisions. Indian textile industry can be divided into several segments: Cotton Textiles Silk textiles Woollen Textiles Readymade Garments Hand-crafted Textiles Jute and Coir

Raymond Ltd is well known for worsted suiting, tailored clothing, denim, shirting, Woollen outerwear. Known for its innovative marketing and distribution strength the company is one of the consistent performers in the Indian scene. The company has a track record of profitability, transparency in operations. Indian textile industry is one of the leading textile industries in the world which largely depends upon the textile manufacturing and export. It also plays a major role in the economy of the country. India earns

about 27% of its total foreign exchange through textile exports. Further, the textile industry of India also contributes nearly 14% of the total industrial production of the country. It also contributes around 3% to the GDP of the country. At present industry requires highest efficiency in physical distribution as companies not working on operational efficiency business models. Companies need to work on improving internal efficiencies to retain
profits which are under pressure on account of dropping prices. The customer (retailer for the company) is seen to be dictating terms so companies have no choice but to lure more customers through incentives. At the same time companies also need to attract final consumers by offering value added services. So we came up with the following recommendations to take up trade promotions, to build up relations with the intermediaries, a need to improve current inventory levels to cut down costs, a need to promote awareness among the customers, improve advertising strategies, and a need to expand in industrial segment by forming strategic partnerships to take advantage of the upcoming industrial growth at national and regional levels.

STRATEGIC MANAGEMENT

Strategic Management is all about identification and description of the strategies that managers can carry so as to achieve better performance and a competitive advantage for their organization. An organization is said to have competitive advantage if its profitability is higher than the average profitability for all companies in its industry. Strategic management can also be defined as a bundle of decisions and acts which a manager undertakes and which decides the result of the firms performance. The manager must have a thorough knowledge and analysis of the general and competitive organizational environment so as to take right decisions. They should conduct a SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats), i.e., they should make best possible utilization of strengths, minimize the organizational weaknesses, make use of arising opportunities from the business environment and shouldnt ignore the threats. Strategic management is nothing but planning for both predictable as well as unfeasible contingencies. It is applicable to both small as well as large organizations as even the smallest organization face competition and, by formulating and implementing appropriate strategies, they can attain sustainable competitive advantage. Strategic Management is a way in which strategists set the objectives and proceed about attaining them. It deals with making and implementing decisions about future direction of an organization. It helps us to identify the direction in which an organization is moving. Strategic management is a continuous process that evaluates and controls the business and the industries in which an organization is involved; evaluates its competitors and sets goals and strategies to meet all existing and potential competitors; and then revaluates strategies on a regular basis to determine how it has been implemented and whether it was successful or does it needs replacement. Strategic Management gives a broader perspective to the employees of an organization and they can better understand how their job fits into the entire organizational plan and how it is co-related to other organizational members. It is nothing but the art of managing employees in a manner which maximizes the ability of achieving business objectives. The employees become more trustworthy, more committed and more satisfied as they can co-relate themselves very well with each

organizational task. They can understand the reaction of environmental changes on the organization and the probable response of the organization with the help of strategic management. Thus the employees can judge the impact of such changes on their own job and can effectively face the changes. The managers and employees must do appropriate things in appropriate manner. They need to be both effective as well as efficient. One of the major role of strategic management is to incorporate various functional areas of the organization completely, as well as, to ensure these functional areas harmonize and get together well. Another role of strategic management is to keep a continuous eye on the goals and objectives of the organization.

RAYMOND COMPANY HISTORY

Dr.Vijaypat Singhania

Dr. Vijaypat Singhania a reputed industrialist who started his business career at an early age of 20. Managing the JK Groups cotton mill in Bombay was his first venture into business. He then extended his portfolio to manage the Groups fertiliser and chemicals factories as well. On the untimely demise of the then Chairman of Raymond, Mr. G.K. Singhania on January 3, 1980, Dr. V.P. Singhania took over as CMD of Raymond and its affiliate companies. During his tenure, the Company diversified into manufacture of mens suits, readymade garments, cement, steel, polyester filament yarn, denims, cosmetics and prophylactics. He expanded the files plant in Indonesia and the woollen plant in Kenya and turned them into respected and profitable ventures in their respective countries. Under his able management, which spread over two decades, Raymond witnessed an increase in sales by 30 times, while PAT grew by 137 times and Net Worth increased by 61 times. On retiring from active management in September 2000, he handed over the reins of the Raymond management to his son Mr. Gautam Hari Singhania, who took over as the CMD in 2000. As a token of Dr. Vijaypat Singhanias meritorious services to the Company, the Board of Directors appointed him Chairman Emeritus & Advisor of the Company effective September 6, 2000.

VPS, as he is fondly called, now generally oversees Raymonds operations and guiding its policies, philosophies and values.

Mr.Gautam Singhania Mr. Gautam Hari Singhania took over the reins of the Company as Chairman and Managing Director in September 2000. Since then, he has steered the destiny of Raymond Limited with a single-minded focus of making it the best brand in India. He has taken active interest in the launch of new services and products. He was instrumental in the successful launch of the brand KamaSutra in 1991. In 1996, he launched a new division called Million Air, providing quality air-taxi charter services. It was under his leadership that the fashion casual wear brand Parx and premium mens wear brand Manzoni were launched in the year 1999 and 2000 respectively. In 2001, Mr. Gautam Hari Singhania introduced the concept of corporatisation of designer wear in India. He was also instrumental in Raymonds acquisition of ColorPlus, a leading menswear brand.

Under his leadership, the Raymond Group has become an internationally reputed premium fibre to fashion player with immense strength in worsted suitings, high value cotton shirting, denim, garmenting, owning market leading brands with a deep distribution network across the country and a premium international client base. His personal vision for the group was to take the Raymond Brand from being amongst the most respected Indian brands to be amongst the best in the global market.

With over 60% market share in India, Raymond Ltd. is one of the largest integrated manufacturer of worsted fabric in the world. The company comprises the following divisions:-

With a capacity of 38 million meters in wool & wool-blended fabrics, Raymond commands over 60% market share in worsted suiting in India and ranks amongst the first three fully integrated manufacturers of worsted suiting in the world.

J.K. Files & Tools and Ring Plus Aqua Ltd. are the group companies that are engaged in the manufacture of precision engineering products such as steel files, cutting tools, hand tools, agri tools and auto components.

Raymond Ltd. is one of the first Corporate House in India to launch Air Charter Services in India in 1996 and since then it has been always a way ahead for Raymond Aviation.

The Raymond Group was incorporated in 1925 and within a span of a few years, transformed from being an Indian textile major to a global conglomerate. The company has the diverse product range of nearly 20,000 designs and colour suiting of fabrics. They export their products to over 55 countries including USA, Canada, Europe, Japan and the Middle east. The company has registered the turnover of USD 636.7 million for the FY 2011 as compared to USD 364 million turnover in 2006. Their suitings are available in India over 400 towns through 3,000 retailers as well as over 500 exclusive retail shops. In their endeavor to keep nurturing quality and leadership, they always chose the path untaken - from being the first in 1959 to introduce a polywool blend in India to creating the world's finest suiting fabric the Super 250s made from the superfine 11.4 micron wool. Today, the Raymond group is vertically and horizontally integrated to provide customers total textile solutions. Few companies globally have such a diverse product range of nearly 20,000 varieties of worsted suiting to cater to customers across age groups, occasions and styles. They manufacture for the world the finest fabrics - from wool to woolblended worsted suiting to specialty ring denims as well as high value shirting. After making a mark in textiles, Raymond forayed into garmenting through highly successful ventures like Silver Spark Apparel Ltd., EverBlue Apparel Ltd. (Jeanswear) and Celebrations Apparel Ltd. (Shirts). They also have some of the most highly respected fabric and apparel brands in their portfolio: Raymond, Raymond Premium Apparel, Park Avenue, ColorPlus, Parx,Makers and Notting Hill. The Raymond Group also has an expansive retail presence established through the exclusive chain of 'The Raymond Shop' and stand-alone brand stores. They are today one of the largest players in fabrics, designer wear, denim, cosmetics & toiletries, engineering files & tools, prophylactics and air charter services in national and international markets. All their plants are ISO certified, leveraging on cutting-edge technology that adheres to the highest quality parameters while also being environment friendly.

Raymonds wide range of products and services include: Total textile solutions Fabrics (Worsted, denim and shirting) Apparels(tailored clothing, Jeanswear and dress shirts) Brands( Raymonds, Manzoni, Park Avenue,Color Plus; Parx; Be; Zapp; Notting Hill; and The Raymond Shop) Woollen outwear Furnishings

Retail( the Raymond shop and Brand store) Engineering(Files, Cutting wools,Hand tools and agri Tools, and auto

components) Personal care (Park Avenue and Kamasutra)

Prophylactic (kamasutra and surgical gloves) International Business

Corporate wear.

SUBSIDIARIES:

Raymond Ltd. Raymond Ltd. is among the largest integrated manufacturers of worsted fabrics in the world. Raymond Apparel Ltd. Raymond Apparel Ltd. has in its folio some of the most highly regarded apparel brands in India Raymond Premium Apparel, Park Avenue, Parx and Notting Hill. ColorPlus Fashions Ltd. ColorPlus is among the largest smart casual brands in the premium category. The company was acquired by Raymond to cater to the growing demand for a high end, casual wear brand in the country for Men & Women. Silver Spark Apparel Ltd. A garmenting facility that manufactures formal suits, trousers and jackets. EverBlue Apparel Ltd. A state-of-the-art denim garmenting facility. Celebrations Apparel Ltd. A facility set-up for the manufacture of formal shirts. J.K. Helene Curtis Ltd. A leading player in the grooming, accessories and toiletries category. J.K. Investo Trade (India) Ltd. JKIT is an investment company registered with Reserve Bank of India as Non-Banking Financial Company.

J.K. Files & Tools A leading player in the Engineering Files & Tools segment and the largest producer of steel files in the world.

Ring Plus Aqua Ltd. A leading manufacturer in the engineering automotive components.

Trinity India Ltd. A leading supplier of components and sub assemblies for the automotive global market.

JOINT VENTURES

Raymond UCO Denim Pvt. Ltd. The manufacturers and marketers of denim fabrics. Raymond Zambaiti Pvt. Ltd. A Greenfield facility manufacturing high value cotton shirting. J.K. Ansell Ltd. The manufacturers and marketers of KamaSutra condoms and surgical gloves.

J.K. Talabot Ltd. Our Joint venture with MOB Outillage SA, manufacturing files and rasps for international markets.

BOARD OF DIRECTORS

Name Vijaypat Singhania H Sunder Nabankur Gupta Shailesh V Haribhakti

Designation Chairman Emeritus Whole Time Director Director

Director Akshay Chudasama Gautam Hari Singhania I D Agarwal P K Bhandari Pradeep Guha Boman R Irani Chairman and Managing director Director Director Director Director

AWARDS AND RECOGNITION

Raymond Made-to-Measure has won the 'Most Innovative Store Design' from ET Retail Awards 2011. Raymond has won the 'Most Trusted Apparel Brand 2011' Award from Economic Times Brand Equity. The Businessworld Most Respected Company Award 2011 in the Apparel & Textile category. Raymond has been ranked 20th in "The Brand Trust Report, India Study, 2011". Images Fashion Awards 2009 - Most Admired Textile Brand of the Year Reader's Digest - Platinum Trusted Brand, 2008 Lyrca Images Fashion Awards 2008 - Most Admired Textile Brand of the Year Lyrca Images Fashion Awards 2008 - Most Admired Suiting Brand of the Year CNBC Consumer Award 2007 - The Best Branded Readymade Garment and Textile
Park Avenue

PARK AVENUE has won the Most Preferred Mens Apparel Brand under the Lifestyle category in the NORTH EAST CONSUMER AWARDS 2011. Park Avenue has been ranked 36th 'Most Trusted Personal Care Brand 2011' in Economic Times Brand Equity. Images Fashion Awards 2011 - Most Admired Mens Formalwear Brand of the Year Images Fashion Awards 2009 - Most Admired Menswear Brand of the Year Lyrca Images Fashion Awards 2008 - Most Innovative Lycra Brand of the Year EEPC (Engineering Export Promotion Council) India "Export Excellence Award 2011-2012" for Hand Tools Exports in the category of Large Enterprise EEPC (Engineering Export Promotion Council) India "Star Performer Award Year 2008-2009" for the highest engineering exports in Hand Tools (Large Enterprise) DHL & CNBC TV18 International Trade Awards 2006-07 - 'Outstanding Exporter Award' in the engineering category

ACCOR Services - (International Leaders and India's Foremost in Employee Benefits, Motivation and Loyalty Solutions) - Presented the "GLOBAL HR EXCELLENCE AWARDS 2007-08" for the Outstanding Contribution to the Cause of Education at the Asia Pacific HRM Congress

SWOT ANALYSIS A scan of the internal and external environment is an important part of the strategic planning process. Environmental factors internal to the firm usually can be classified as strengths (S) or weaknesses(W), and those external to the firm can be classified as opportunities(O) or threats (T).Such an analysis of the strategic environment is referred to as a SWOT analysis. The SWOT analysis provides information that is helpful in matching the firms resources and capabilities to the competitive environment in which it operates. As such it is instrumental in strategy formulation and selection. SWOT ANALYSIS FRAMEWORK Environmental scan / Internal Analysis Strengths Weaknesses External analysis Opportunities Threats

SWOT MATRIX Strengths A firms strengths are its resources an capabilities that can be used as a basis for developing competitive advantage. Examples of such strengths include: Patents Strong brand names Good reputation among customers Cost advantages from proprietary know-how Exclusive access to high grade natural resources Favourable access to distribution networks

Weaknesses

The absence of certain strengths may be viewed as weakness. For example, each of the following may be considered weakness. For example, each of the following may be considered as weaknesses: Lack of patent protection A weak brand name Poor reputation among customers High cost structure Lack of access to the best natural resources Lack of access to key distribution channels

In some cases, a weakness may be the flip side of the strength. Take the case in which the firm has a large manufacturing capacity prevents the firm from reacting quickly to the changes in strategic environment. Opportunities The external environmental analysis may reveal certain new opportunities for profit and growth. Some examples of such opportunities include: An unfulfilled customer needs Arrival of new technologies Loosening of regulations Removal of international trade barriers

Threats Changes in the external environment also may present threats to the firm. Some examples of such threats include: Shift in consumer tastes away from the firms products Emergence of substitute products New regulations Increased trade barriers

The SWOT matrix The firm should not necessarily pursue the more lucrative opportunities. Rather it may have a better chance at developing a competitive advantage by identifying a fit between the firms strengths and upcoming opportunities. In some cases the firm can overcome the weakness in order to prepare itself to pursue a compelling opportunity. To develop strategies that take into account the SWOT profile the matrix of these factors can be constructed SWOT/ TOWS MATRIX Strengths Opportunities Threats S-O strategies S-T strategies Weaknesses W-O strategies W-T strategies

S-O strategies pursue opportunities that are a good fit to the companys strengths. W-O strategies overcome weaknesses to pursue opportunities. S-T strategies identify ways that the firm can use its strengths to reduce its vulnerability to external threats. W-T strategies establish a defensive plan to prevent the firms weaknesses from making it highly susceptible to external threats.

REFERENCES: 1. Simplified strategic planning: a No-Nonsense Guide for Busy People who want Results fast!- bradford