INTRODUCTION

Tube investments of India Ltd is one of the famous and reputed company
located at Chennai and its brand own very good position in the Chennai market.

The project is about the market potential identification of the product Hercules
E3 cycle. Marketing of this product is purely undertaken by the marketing department of
Ti cycles.

The project aims at finding the real potential for the product Hercules E3 cycle
in Chennai. Also the project aims at other issues such as purchase behavior of consumer
and to identify the various ways to promote the brand.

The sample size for the project is 200.The sample design is convenient
sampling.

The research study used in the project includes the descriptive research, and
research methodology user here is survey.

The sampling unit is some areas in Chennai. The coverage duration for this
project is about three months.

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INDUSTRY PROFILE

ABOUT BICYCLE

A bicycle or bike is a pedal – driven land vehicle with two wheels attached to a
frame, one behind the other. First introduced in 19th-century Europe, bicycle evolved
quickly into their familiar, current design. Numbering over1000, 000,000 in the world
today, bicycles provide the principal means of transportation in many regions and a
popular form of recreational transport in others. To distinguish a bicycle from a
motorcycle, it is also called a pushbike.

The bicycle in one of the most notable of human invention.The basic shape and
configuration of the frame, wheels, pedal, saddle and handle bars has hardly changed since
the first chain-driven model was developed around 1885, although, many important detail
improvements have been made since, especially in recent years using modern materials
and computer-aided design.

A remarkable aspect of the bicycle is its widespread adoption in many different

fields of human activity, e.g. as a child’s toy in adult recreation and fitness, as a means of
everyday transport, in cycle- touring as a barks of cycle sport (branches: tack, off- road or
MTB, downhill, cycle-cross, time tailing, road racing, cycle speedway, cycle polo, BMX),
and as a basis for static gymnasium or home fitness versions.

A human being traveling on a bicycle at low to medium speeds of around 10-15

mph (16-24kph), using only the energy required to walk, in the most energy – efficient
means of transport generally available. Is day, which increases with the square of speed,
requires increasingly higher power outputs relative to speed. A bicycle in which the rides
lies in a prone position and which may be covered in as aerodynamic faring to achieve very
low air drag in referred to as a recumbent bicycle or human powered vehicle.

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 The bicycle has affected history considerably in both the cultural and industrial
realness. In its early years, bicycle construction drew on pre-existing technologies; in turn,
to others, newer areas. Beyond recreation and amputation, bicycles have been adapted for
use in many occupations, including the military, policing, courier services, and sports. A
recurrent theme in bicycling has been the tension between bicyclists and drivers of motor
vehicles, each group arguing for its fair share of the world’s roadways.

THE HISTORY OF BICYCLE INDUSTRY

No single time a person can be identified with the invention of the bicycle. Its
earliest know forebears were called velocipedes and included many types of human-
powered vehicles. One of these, the scooter-like dandy horse of the French comet de
sivrac, dating to 1970, was long cited as the earliest bicycle. Most bicycle historians now
believe that these hobbyhorses with no steering mechanisms probably never existed, but
were made up by Louis bawdry de saunier, a 19th- century French bicycle historian.

The most likely originator of the bicycle in German Baron Karl Von Drais, who
rode his tenants. He patented his draisine, a number of which still exist, including one of
the paleis let too museum in Apeldoorn, the Netherlands. These were pushbikes, powered
by the action of the rider’s feet pushing against the ground.

Scottish blacksmith Kirkpatrick Mac Million shakes creative credit with von Drais,
for adding a treadle drive mechanism, in 1840 that enabled the rider to lift his feet off the
ground while driving the rear wheel. However, some reports describe Macmillan’s vehicle
as more of a “quadricycle”.

In the 1850s and 1860s, Frenchman Ernest Michaux and his pupil Pierre Lallement
took bicycle design in a different direction, placing pedals on an enlarged front wheel.
There creation, which came to be called the “Boneshaker”, featured a heavy steel fame on
which they mounted wooden wheels with iron tires. Lallement emigrated to America,

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where he recorded a patent on his bicycle in 1866 in new haven, Connecticut. The
boneshaker was further refined by James Starley further refined the Boneshaker in the
1870s. He mounted the seat more squarely over the pedals, so that the rider could push
more firmly, and further enlarged the front wheel to increases the potential for speed with
tires of solid rubber, his machine became known as the ordinary. British cyclists likened
the disparity in size of the too wheels to their win age, nicknaming it the penny-farthing.
The primitive bicycles of this generation were difficult to ride, and the high seat and poor
weight distribution made for dangerous falls.

The subsequent dwarf ordinary addressed some of these faults, by adding gearing,
reducing the front wheel diameter, and setting the seat further back with no loss of speed.
Having to both pedal and steer via the front wheel remained a problem.

Staley’s nephew, J.K. Starley, J.H. Lawson, and Shergold solved this problem by
introducing the chain and producing rear- wheel drive. These models were know as dwarf
safeties, a safety bicycles, for their lower seat height and better weight distribution.
Starley’s 1885s Rover is usually described as the first recognizably modern bicycle. Soon s
the seat tube was added, creating the double triangle, diamond frame of the modern bike.

While the Starley design was much safer, the return to smaller wheels made for a
bumpy ride. The next innovations increased comfort and ushered in the 1890s golden age
of bicycles. In 1885 Scotsman john Boyd Dunlop introduced the pneumatic tire, which
soon became universal. Shortly there often the rear free wheel was developed, enabling the
rider to coast without the pedals spinning cut of control. This refinement led to the 1897
invention of coaster brakes. Derailleur gears and hand-operated; cable-pull brakes were
also developed during these years, but were only slowly adopted by casual riders. By the
turn of the country, bicycling dubs flourished on both sides of the Atlantic, and touring and
racing were soon the range.
Successful early bicycle manufactures included Englishman frank Bowden and
German builder Ignaz Schwinn. Bowden started the Raleigh Company in noting ham in
the1890s and soon was producing some 80,000 bicycles a year. Schwinn emigrated to the

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united states. Where he founded his similarly successful company in Chicago I 1895.
Schwinn bicycles soon featured widened tires and spring-cushioned, padded seats,
sacrificing some efficiency for increased comfort facilitated by connections between
European nations and their overseas colonies. European- style bicycles were soon available
worldwide.

By the mid. 20th century bicycles had become the primary means of transportation
for millions of people around the globe.

In many western countries the uses of bicycles traveled off a declined, as motorized
D became affordable and car- centered policies led to an increasingly hostile road
environment for bicycles. In North America, bicycle sales declined markedly after 1905, to
the point where by the 1940s they had largely been relegated to the role of children’s toys.
In the other part of the world however, such a china, India and European countries such as
Germany, Denmark, and the Netherlands, the traditional utility bicycle remained a
mainstay of transportation, its design only gradually changing to incorporated hand-
operated brakes and internal hub gears allowing up to seven speeds. In the Netherlands,
such so- called granny bikes have remained popular, and are again in production.
Especially in austere Dane they are often colorfully painted and or otherwise decorated.

Preservation spawned a renaissance of bicycling in the late1960s. Bicycle sales in

the United States boomed, largely in the form of the racing bicycles long used in such
events as the hugely popular Tour de France. Sales were also helped by a number of
technical innovation that were new to the us marked, including higher number of gears.
While 10 speeds were the rage in the 1970s, 12-speed designs In North America,
increasing consciousness of physical fitness and environmental were introduced in the
1980s and today most bikes features 18 or more speeds.
By the 1980s these newer designs had driven the three-speed bicycles from the
roads. In the late 1980s the mountains bike became particularly popular, and in the 1990s
something of a major fad. These task- specific designs led many American recreational
cyclists to demand a more comfortable and practical product. Manufactures responded with

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the hybrid bicycles, which restored many of these features long enjoyed by riders of the
time-tested European utility bikes.

INDUSTRY SCENARIO

• 4 Major manufactures- Hero, TICI, Atlas, Avon

• Industry capacity-250 lakhs cycles per annum (as on 2009)

• Industry capacity utilization-91%(as on 2009)

• Industry penetration- 54 %(as on 2009)

• Concentration of component supplies at Ludhiana/ Delhi

• Approx. 3500 deals across the country

MAJOR PLAYERS (as on 2009)

Company Volume (Lakh Nos.) Market Share

HERO 53.85 40%
TII 28.83 26%
ATLAS 28.30 28%
OTHERS 7.68 06%

India is the second largest maker of bicycles in the world. Around a million
bicycles (valued at rs.1500 crore) are produced each year. Ludhiana has been the prime
source of components fir the cycle industry in India. Recently, vendor bases have come up
in other parts of the country there by diluting the geographical risk.
Cycles can be classified into two segments- standards and specials. There are four
major players- Hero cycles, TI cycles, Atlas cycles and Avon cycles. With changing
environment, the market for standard for standard bicycles has become highly price
sensitive allowing small players to take aggressive price postures. The special category

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bicycles are more differentiated by design and find market in kids, students and youth, for
fitness and leisure.

The bicycle industry in India has witnessed continue downward tend in demand
over the last three years. In 2004-2005, there was 7 percent drop in volume over the
previous year. Increased urbanization, in proved public transport system, increased
affordability of motorized vehicles and limited road-space for bicycles (there in complete
absence of “cycles only” lanes even in most congested and polluted cities) are said to be
some of the causes for the down turn. However, the bicycle is still the first vehicle for most
children and there is growing use of bicycle as health and leisure products.

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 COMPANY PROFILE

MURUGAPPA GROUP

The Murugappa group, headquartered in Chennai, India, is a $1.5dillion

conglomerate with interest in engineering, abrasives, sanitary ware, fertilizers, finance,
bio-products and plantations. It has 29 companies under its umbrella; eight are listed and
actively handed on the national stock exchange and the Bombay stock exchange. Together,
they have over 28,000 employees.

The business has its origins in 1990, when Dew a bahadur AM Murugappa chattier
established a money-lending and banking business in Burma (now Myanmar), which then
spread to Malaysia, Sirlanka, Indonesia and Vietnam. A century down the line, it has
withstood enormous vicissitudes (including strategically moving its assets bank to India
and restarting from scratch in the 30’s before the Japanese invasion in world war 2) to
became one of the country’s biggest industrial houses. The group turn over crossed the $1
billion mark in 2003-04, with an impressive growth of 25% Rs. 42,060 million in 2002-03.
The group clocked a 40 percent jump in profit before tax over the previous year.
Murugappa Group’s consolidated turn over for 2004-05 crossed $1.44 billion. The group
achieved a growth of 20 percent over the previous year.

The group is a market leader in India across a spectrum of products like sanitary
ware, fertilizers, abrasive, automotive chains, car doorframes and steel tubes. Neemzal, a
neem-based organic pesticide, is the country’s best known brands like BSA and Hercules
in bicycles, parry ware in sanitary ware, parry’s spiraling and parry’s Beta carotene in
nutraceuticals, ball master and Ajax in abrasives, Gromor and Paramfos in fertilizers, and
many more come from the Murugappa group

Its companies have tie-up with Borg-Warner of the USA, wend of Germany.
Morgan Crucibles of the U.K and Mitsui Sumitomo insurance of Japan. It has registered 43

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International patents for its research and development innovation. The group has grown
consistently through its decisive and visionary response to change times. Its pioneering
efforts, steadfast commitment to ethical business practices and its dogged pursuit of new
arras to extend its business acumen have brought in its wake several prestigious national
and international awards.

Social commitment has always been the cornerstone of the group’s ethos and its
has been at the forefront of eco-conservation, public health, and education in the
communities where its companies operate, since 1957. It runs four schools, a polytechnic
college and four hospitals. Besides, the group runs a research and development center for
rural development the sir AMM Murugappa Chettiar research center (MCRC), which has
been a derigning simple, cocst-effective technology for local artisans since 1977.

The Murugappa group has 29 companies active in the area of engineering, abrasive,
sanitary- ware, fertilizers, finance, bio-products and plantations. The major companies of
the group all:

• Carborumdum universal limited

• Cholamandalam investment& finance company Ltd.
• Coromandel fertilizers Limited
• EID parry Indian Limited
• Godavari fertilizers Limited
• Parry Agro industries Limited
• Parry nutraceuticals Limited
• Tube investment of India Limited

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Name of the Organization % of turn over
TII 28%
EIDP 34%
CFL 16%
CUMI 8%
OTHERS 14%

TUBE INVESTMENTS OF INDIA LIMITED

A reputed engineering company in India, driving excellence in work and part of the
US $1.5 billion India conglomerate, the Murugappa Group

CORPORATE CHRONICLE
• Incorporate in 1949- TI cycles of India (TICI) in collaboration with TI, UK the
world’s largest manufactures of bicycles.
• A tube product of India (TPI) was established in 1955 with the objectives of
providing backward integration to bicycles.
• TPI merged with TICI in 1959. Name of the company changed to tube
investments of India Ltd.
• TPI established a cold Rolling mill in 1962 for the production of cold Rolled
close annealed steel strip.
• TPI established EOU at Avadi in 1996
• Tube plant commissioned in 1997 at Shirwal, Maharashta.
• Facilities to produce doorframes for Maruti 800 cc and Hyundai Santro in 1998
• Cycle’s plant at Nashik set up in 2001.

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 Tube Investments of India limited is the flagship company of Rs. 6250 cr.
Murugappa Group. It manufactures precision steel tubes and ships, car door flames, auto
motives and industrial chain and bicycles.

The company has 13 manufacturing assembly units spread across the

country. Marketing offices that act as interface between customer requirements and
production train ably support these units. The company’s shares are listed on the national,
Mumbai and Chennai stock exchanges within India and GDRS on the Luxembourg stock
Exchange. The company’s product segments are- Engineering, metal formed products and
cycles.

• TI is the market leader in precision tubes with 61 percent market share by virtue
of its quality & application engineering capabilities
• TI is a leading players in auto motive chain with 35 percent market share by
virtue of its quality, cost& delivery and association with two wheeler major
• TI is a leading player in bicycles segment with 30 percent market share by
virtue of its brand equity, product development capability and proximity to the
markets.
• TI is the market leader in roll formed car door flames with 57 percent market
share by virtue of its cist efficiency, association with key auto majors and roll
forming capabilities
• The company reported a turn over of Rs. 1563.39cr and profit after tax of

Rs. 98.55cr in 2004-2005

The company also has an interest in the services sector through its
investments in Cholamandalam Investment and finance company Ltd and Cholamandalam
MS general insurance Co.Ltd.

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 Tube investment of India was one of the most important post-
independence forays of the Murugappa group into manufactures. It was a niche the group
identified as a trump card for a nascent nation; marking the poor man’s vehicle, the
bicycle. It was originally founded as TI cycles of India, in 1949.Group companies Tube
products of India and TI miller-, which manufactured cycle, lamps and dynamo sets-were
merged with the company in 1959 and 1984 respectively.

TII in the second largest- manufacturer of bicycles in India, marketing

top. Brands like Hercules, BSA and Philips, and had a market share of 31 percent in 2003-
04.In the value-added special segment, TI in the leader, with a 50 percent market share.
More recently, the company entered the promising health conscious ‘exercise’ bicycle’
segment in 2002-03. TI cycles of India, one of the leading bicycle manufacturers in India,
started in 1949, has been at the forefront of innovation and is a pioneer in the market of
cycles. TI cycles are the makes of country’s most famous brands like Hercules, BSA and
Philips cycles. The company’s vision is to be a world wide leader in cycling and solution
by instilling the pride of ownership in the customers”

Brands

Hercules– the flag ship brand of TI cycles portfolio, this brand of ours is still as young as
ever. Hercules stands for a unique pride of possession-anchored in the time-tested values of
heroisne and integrity, to which the brand’s customers subscribe in their own lives.

BSA- another flag ship brand of TI cycles, BSA stands for Birneighani small arms. It
signifies the joy of cycling; fun and comfort go hand in hand with BSA. BSA today is an
intrinsic part of the Indian family with cycles for everyone. Kids teams and adults.

Certificates: certified with ISO 9002 &ISO 14001

Exports: TI cycle is an exporter to many regions across the global-Europe, south East Asia
and Africa; being some of them

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Locations: Chennai (corporate HO), Nashile, Noida, Durgapur, Bang lore, kolkatta,
Patna& ludhiana
A subsidiary, tube products of India was set up in 195 in collaboration with tube
products (old bury) Ltd, UK to produce electric resistance welded (ERW), cold drawn
welded (CDW) tubes and draw over mandrel (DOM) tubes. In 1957, tube investments of
India started production of cold-rolled close annealed steel strips, in collaboration with TI,
UK, primarily to meet in- house and group requirements

Though started as a backward integration project for the manufacture of

bicycles, today, TPI is a major preferred supplies of precision welded tubes to major
automotive companies in India and abroad. It is the undisputed leader in the Indian market
for precision welded ERW & CDW steel tubes, with the widest variety and range in terms
of size as well as material gracles offered. TPI started operation at Avadi, chennai, but has
expanded with two more plants satirically located in western and northern India

Another subsidiary, TI metal forming, is a pioneer in coid roll forming. It

manufacturers and dupplies value- added metal formed components like car door flames,
sash/ division channels, door guide rails and bar assembly. It has plant in chennai and
Bawal(near Gurgaon). Both plants in chennai and QS 9000 certified.

The chennai plant is ISO14001 certified.

A third plant has been set up near Baroda (in Gujarat state, western India) to
manufacture and supply doorframes, impact beam, bar and rail assembly for general
motors, India. Its client list includes Maruti udyog and Hyun

TIDC INDIA formerly known as TI Diamond chain Ltd, was

establisted in 1960 in collaboration with the Diamond chain co, USA. Starting as a marker
of bicycle chains, it now makes over 1,000 varieties of chains- in industrial chains TIDC
produce from tiller chains, leaf chains and conveyor chain to in dustrial power drive
chains, engineering class chains, in automotive TIDC produces motarcycle drive chains

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ands engine mechanism chain and fine blank parts. annually production runs to 45 million
ESS feet, and commands 40 percent of the domestic market share. The company is known
for developing high performance chains, for specific applications and machinery. Some of
TIDC’S popular brands are Diamond and Xtron, TIDC exports to over 50 countries
worldwide.

TII has entered into a joint venture with Borg Warner Morse TEC,
USA for production of timing and silent chains. It has entered into a technology agreement
with Tsubakimoto chains company, Japan, for engineering class chains. Some of TI
Diamond chain’s popular brands are Diamond and Xtron.

UNITS

TI CYCLES OF INDIA
TUBE PRODUCTS OF INDIA
TI METAL FORMING OF INDIA
TIDC INDIA

TII- Business portfolio

Business % Turn over
Cycle 41%
Engineering 56%
Metal Forming 3%

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PRODUCT PROFILE- “TI CYCLE SOF INDIA”

TUBE INVESTMENTS OF INDIA is one of the largest integrated cycle

manufactures in Asia, Manufactures high quality bicycles for both domestic and
international market. TI CYCLES OF INDIA manufactures and markets the Hercules,
BSA and Phillips brands.
HERCULES
 Hercules MTB
 Hercules Thriller
 Gear Ezy Ultra
 Hercules Ultima
 Hercules Captain Shakthi
 Hercules Bravo
 Hercules Tornado
 Hercules Axn
 Hercules Glider
 Hercules Top Grand Champion
 Hercules Explorer
 Hercules Captain Kidz
 Hercules Ultima Dx
 Hercules Ultima Ex
 Hercules Windpacer
 Hercules Hurricance
 Hercules Spitfire

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 BSA
• BSA Champ Plus
• BSA Lady Bird sport
• BSA Lady Bird
• BSA Dinosour
• BSA Dash Dx
• BSA Comet
• BSA Champ-H-Plus
• BSA Aqua Zing
• BSA Aqua Marine
• BSA Rocket
• BSA Diana
• BSA I-Bike
• BSA Mach
• BSA New Mach
• BSA Spice-Ic
• BSA Foldman
• BSA City Axt
• BSA Photon
• BSA SLR 2000
• BSA Delite
• BSA Supreme

Health Segment
• BSA Trim Gym
• BSA Trim Gym Jogger
• BSA Trim Gym Step

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 HERCULES E3

Color: Orange/Cool Grey

Price: 12,202/-

Get there faster with the Hercules e3 kit. A battery operated motor that can be fitted on
any standards bicycle, it assists you when you need to pedal for long distances.So you
can cover more distance with less effort.

In order to make biking a viable commuting option, two months ago BSA launched
Hercules E3, the motorised bicycle.A chargeable battery makes the old-fashioned bike
more efficient, require less energy to ride. With a three-hour charging, the bike can be
used to travel a distance of 30 km. These cycles can be used in rural areas where cycles
are still the mode of transport

Features and Benefits:

• It can be fitted on any Standards bicycle, including the existing one on road.
• The cycle can also be ridden normally when it’s not on the power assist mode.
• It comes with a detachable battery that can be taken inside the house for charging.
• Its thumb throttle is easy to operate and less strain on the hands.
• Has a top speed of 24kmph and runs 30km on a single charge.
• Has a running cost of less than 10paise / km.

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PARTS

18
 REVIEW OF LITERATURE

Market Potential Analysis

Market potential analysis is a primary analytic service performed by Mapping

Analytics. We have the people, experience, tools, and data required to perform
sophisticated and accurate market sizing.

Market potential has been defined as the “the maximum demand response
possible for a given group of customers within a well defined geographic area for a given
product or service over a specified period of time under well defined competitive and
environmental conditions.

First, market potential is the maximum demand response under certain

assumptions. It denotes a meaningful boundary condition on ultimate demand. Another
condition on which the concept of market potential depends is a set of relevant consumers
of the product or service. It is not merely the present consumer who is to be included but
also the potential consumer as maximum possible demand is to be achieved.

Market potential will vary depending on which particular group of consumers is

of interest.

Further the geographic area for which market potential is to be determined should
be well defined. It should be divided into mutually exclusive subsets of consumers so that
the management can assign a sales force and supervise and control the activities in
different territories without much difficulty.

Another relevant aspect in understanding the concept of market potential is to

clearly know the product or service for which market potential is to be estimated.
Especially in those cases where the product in question can be substituted by another, it is
desirable to have market potential for the product class rather than that particular product.

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 The most difficult estimate to make is that of the total potential available to the
whole market, including all segments covered by all competitive brands. It is often
achieved by determining the “maximum potential individual usage”, and extrapolating
this by the maximum number of potential consumers. This is inevitably a judgment rather
than a scientific extrapolation, but some of the macro forecasting techniques may assist in
making the estimate more soundly based.

The maximum number of consumers available will usually be determined by

market research, but it may sometimes be calculated from demographic data or
government statistics. Ultimately there will, of course, be limitations on the number of
consumers. For guidance one can look to the numbers using similar products.
Alternatively, one can look to what has happened in other countries. It is often suggested
that Europe follows patterns set in the USA, but after a time lag of a decade or so. The
increased affluence of all the major western economies means that such a lag can now be
much shorter.

A market potential analysis from Mapping Analytics may include:

• A customer profile to understand where to find more like them.

• Market penetration and market share reports showing performance in existing
markets and expected performance in new markets.
• Market ranking reports allowing you to prioritize resource deployment into new
markets.
• A geographic view of market opportunity on detailed maps.

Benefits of Market Potential Analysis

• Understand market potential for a single store, network of stores or a new market
• Deploy resources effectively by ranking markets in priority order.
• Forecast total opportunity in terms of number of customers and revenue potential.
• Estimate your market share.

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 RESEARCH METHODOLOGY

Business research is a systematic inquiry that provides information to guide

business decisions and aimed to solve managerial problems. Business research is of
recent origin and is largely supported by business organizations that hope to achieve
competitive advantages.

Research methodology is a way to systematically solve the research

problems. It may be understood as a science of studying how research is done
scientifically. It includes the overall research design, the sampling procedure, data
collection method and analysis procedure.

3.1 RESEARCH DESIGN

Research design stands for advance planning of the methods to be adopted for
collecting the relevant data and the techniques to be used in analysis, keeping in view the
objectives of the research and availability of time.

Descriptive research includes surveys and fact-finding enquiries of different

kinds. The major purpose of this research is description of state of affairs as it exits at
present.
In this survey the design used is descriptive in nature. The information is
collected from the individuals and analyzed with the help of different statistical tools, for
describing the relationship between various types of variables, pertaining to different
investment options. Moreover Cross table Analysis has been done for processing the data
and information is derived to meet the objectives of the study.

3.2 DATA
3.2.1 Nature of Data

Under the study Primary data was collected by using Questionnaire.

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3.2.2 Source of Data

The Primary data was collected from the individuals residing in Chennai
City, with the help of the questionnaire, which was prepared after getting inputs from the
experts and executives in Way 2 wealth .Secondary data are sourced from Magazines,
Books, Pamphlets, Periodical Surveys, and Websites etc.

3.3 METHOD OF DATA COLLECTION

Structured Questionnaire method is used as an instrument for collecting

information from the individuals. A Pilot study was conducted based on which a few
changes were made in the Questionnaire.

3.4 SAMPLING

Since the populations of consumers are large in number, researcher was

unable to collect information from all individuals due to limitation of time. So part of the
population is taken for analyzing and generating the findings, which may be applicable
for total market.

3.4.1 Sampling Unit

The number of items selected from the population constitutes the sample
size.

3.4.2 Sample Size

The sample size for the study is 200

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3.4.3 Sampling Method

Convenient non-probability sampling is applied. Non-probability sampling is

that sampling procedure which does not afford any basis for estimating the probability
that each item in the population has of being included in the sample. In this type of
sampling, items for the sample are selected deliberately by the researcher; his or her
choice concerning the items remains supreme.

3.5 TOOLS USED

The data has been mainly analyzed by using the following methods and tests.
Cross Tabulation and Percentage method supplemented by appropriate charts.
1. Percentage Analysis
2. Chi – Square Test
3. Mean
4. Weighted average
5. Correlation

STATISTICAL TOOLS

 PERCENTAGE ANALYSIS

Percentage analysis is used to describe a relationship. It is used extensively to

convert the data in terms of percentage to aid the interpretation quantitatively.

Percentage = No. of respondents in category / Total no.of respondents*100

 Mean
Arithmetic average is also called mean. It is obtained by dividing total values of various
items by their number.

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  CHI SQUARE TEST

Chi square tests are conducted to test whether two or more attributes are
associated or not. It describes the magnitude of the discrepancy between theory and
observation. Chi square can only be used if the experimental data or sample observation
are independent of each other. The data collected must be drawn at random from the
universe or population. We use the following formula for calculating the value of chi-
square.

y2 = ( Oi – Ei) 2 / Ei

Where Oi = observed frequency

Ei = expected or theoretical frequency

The degree of freedom is calculated from the frequency table called contingency table by
using the formula d.f = (c-1)(r-1)
Where, c = No. of cell frequencies in columns; r = No. of cell frequencies in rows

 WEIGHTED AVERAGE ANALYSIS

An average in which each quantity to be averaged is assigned a weight. These

weightings determine the relative importance of each quantity on the average. Weightings
are the equivalent of having that many like items with the same value involved in the
average.

Weighted Average = XiWi

Wi

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  CORRELATION ANALYSIS

Correlation or co-relation refers to the departure of two variables from

independence , although correlation does not imply causation. In this broad sense
there are several coefficient, measuring the degree of correlation , adapted to the
nature of the data. The correlation is defined only if both of the standard
deviations are finite and both of them are nonzero. It is a corollary of the
cauchy-Schwarz inequality that the correlation cannot exceed 1 in absolute value.

The correlation is 1 in the case of an increasing linear relationship, -1 in

the case of a decreasing linear relationship, and some value in between in all
other cases, indicating the degree of linear dependence between the variables. The
coefficient is to either -1 or 1 , the stronger the correlation between the variables.

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 OBJECTIVES

Primary objective

 To know about market potential of the product Hercules E3 cycle.

Secondary objectives

 To bring awareness about the product Hercules E3 cycle.

 To identify the consumer preference.

 To understand whether the new concept is welcomed by people or not.

26
 SCOPE OF THE STUDY

 To understand the consumer perception, buying pattern and behavior.

 To identify the potential market growth and various marketing strategies to be
adopted.
 To know the real opportunities that is present.
 The research findings have interdisciplinary use.
 The research findings will fill the gap in the existing theory and will create new
paradigms useful to both academics and the marketers.

27
 LIMITATIONS OF THE STUDY

 The research study is based only on the data collected only from few areas in
Chennai.
 Definite population is unconfined since the market is large.
 Time is the major limiting factor as the available time for survey was only three
months.
 Many customers are reluctant in answering the questionnaire as they are not
aware of the product.
 The information given by the respondents are tentative which may change from
time to time.

Despite the above limitations the researcher has made the study as objective and
meaningful as possible.

28
 GENDER CLASSIFICATION
TABLE 4.1

Particulars No of respondents Percentage of respondents

Male 130 65
Female 70 35

Inference

 Majority of the respondents 65percent of them are male.

 Only 35percent of the respondents are female.

29
 GENDER CLASSIFICATION

CHART- 4.1

Female
35%

Male
65%

Male
Female

30
 AGE OF THE RESPONDENTS
Table-4.2

Particulars No of Respondents Percentage of Respondents

15-20 80 40

20-25 48 24

25-30 50 25

>30 22 11

Inference

 It is found that majority of the respondents belong to the category of 15-20 years.
 24 percent belong to the category 20-25.
 25 percent belong to the category 25-30.
 Only 11 percent belongs to the category above 30.

31
 AGE OF THE RESPONDENTS
Chart -4.2

80 80
70
60 50
48
50
40
22
30
20
10
0
15-20 20-25 25-30 >30 15-20
20-25
25-30
>30

32
 INCOME OF THE RESPONDENTS
Table- 4.3

Particulars No of respondents Percentage of

respondents

<10000 54 27

10000-20000 69 34.5

20000-35000 48 24

>35000 29 14.5

Inference

 It is found that 27 percent of people belong to the category of income level which
is less than Rs10,000/-
 Majority of the respondents that is 34.5 percent comes in category 10000-20000.
 24 percent belongs to the category level 2000-35000.
 Only 14.5 percent belong to the category level which is greater then 35000.

33
 INCOME OF THE RESPONDENTS
Chart - 4.3

15%
27%

24%

<10000
10000-20000
34% 20000-35000
>35000

34
 OCCUPATION OF THE RESPONDENTS
Table-4.4

Particulars No of Respondents Percentage of Respondents

Employed 30 15

Professional 16 8

Postman 24 12

Student 128 64

Others 2 1

Inference

 It is found that majority that is 64 percent of respondents belongs to students.

 15 percent of the respondents were employed.
 8 percent were professional people.
 12 percent of respondents belong to post man.
 Only one percent comes in other category.

35
 OCCUPATION OF THE RESPONDENTS
Chart -4.4

1%
15%

8%

12%

64% Empolyed
Professional
Postman
Student
Others

36
FACTORS THAT COMES TO THE MIND OF THE RESPONDENTS
WHEN THEY HEAR ABOUT TI CYCLES
Table-4.5

Factors No of respondents Percentage of respondents

Quality 92 46

Price 40 20

Reliability 60 30

Others 8 4

Inference

 Quality is the first thing which attracts many customers towards ti cycles.
Majority of the people say quality is the first thing which comes to their mind.
 20 percent of people consider price.
 30 percent of people say that reliability is the thing which comes to their minds.
 Only 4 percent of people say other things like fashion, color and comfort comes to
their mind.

37
FACTORS THAT COMES TO THE MIND OF THE RESPONDENTS
WHEN THEY HEAR ABOUT TI CYCLES
Chart -4.5

100

80

Others
60
Reliability
92 Price
40
Quality
60
20 40

8
0

38
 PURPOSE OF USING THE BICYCLE
Table – 4.6

Purpose No of respondents Percentage of respondents

Education 128 64

Postal services 24 12

Household purpose 32 16

Others 16 8

Inference

 64 percent of people use bicycle only for education purpose. Majority of the
persons who are using bicycle are students.
 12 percent of people use it for postal services.
 16 percent of people use it for household purposes.
 Other people use it for different purposes like fitness, delivering newspaper and
milk etc.

39
 PURPOSE OF USING THE BICYCLE
Chart – 4.6

140 128

120
Education
100
Postal services
80

60 Household
services
32 Others
40
24
16
20

40
 FACTORS INFLUENCING PURCHASE DECISION
Table-4.7

Factors No of respondents Percentage of respondents

Quality 56 28

Price 96 48

Brand name 28 14

Features 20 10

Inference

 28 percent of people consider quality as a main thing before making a purchase

decision.
 Majority that is 48 percent of people prefer price as a main factor.
 14 percent of people consider brand name.
 10 percent of people consider features they want the look to be attractive.

41
FACTORS INFLUENCING PURCHASE DECISION
Chart -4.7

10%
28%
14%
Quality
Price
Brand name
Features

48%

42
 AWARENESS ABOUT E3 CYCLES
Table-4.8

Factors No of respondents Percentage of respondents

Before my explanation 60 30

Only after my explanation 140 70

Inference

 The awareness level is very low for the product E3 cycles. Because nearly 70
percent of the people were not aware about the product only after my explanation
they came to know about the product. To reach the market the company has to
bring lot of awareness about the product to the people.

43
 AWARENESS ABOUT E3 CYCLES
Chart -4.8

30%

Before explanation
After explanation

70%

44
 INFLUENCE OF PERCENTAGE OF WARRANTY TO BUY THE
CYCLE
Table-4.9

Factors No of respondents Percentage of respondents

25% 12 6

25% to 50% 40 20

50% to 75% 68 34

75% to 100% 80 40

Inference

 40 percent of people consider warranty is an important factor for purchasing a

cycle.
 34 percent consider warranty between the range 50% to 75%.
 20 percent of people consider warranty less than 50% but more than 25%.
 Only 6% do not worry about the warranty. They give less importance to it.

45
INFLUENCE OF PERCENTAGE OF WARRANTY TO BUY THE
CYCLE
CHART -4.9

6%

20%
40%

34%

25%
25% to 50%
50% to 75%
75% to 100%

46
 PREFERENCE OF RESPONDENTS TO HAVE A DEMO BEFORE
MAKING A PURCHASE
Table-4.10

Particulars No of respondents Percentage of respondents

Yes 168 84

No 32 16

Inference

 Majority of the people believe that they need to have a demo before making their
purchase. They want to check and see whether the new technology is working
properly or not.

47
PREFERENCE OF RESPONDENTS TO HAVE A DEMO BEFORE
MAKING A PURCHASE
CHART -4.10

180 Yes

160
140
120
100 Yes
80 No
60
No
40
20
0

48
 REACTION TO THE NEW CONCEPT
TABLE -4.11

Particulars No of respondents Percentage of respondents

Poor 28 14

Good 70 35

Very good 60 30

Excellent 42 21

Inference

 It is found that majority of the respondents 30 percent consider the concept to be a

good one.
 30 percent feel that it is really too good.
 21 percent feel that it is really an excellent one they consider this as a good
advancement of technology.
 Only 14 percent feel that the concept is a poor one they are just satisfied with the
old model itself.

49
 REACTION TO THE NEW CONCEPT
CHART -4.11

80
70
70
60
60

50
42
40

30 28

20

10
POOR
0
GOOD
VERY GOOD
EXCELLENT

50
 SATISFACTION LEVEL TOWARDS PRICE
TABLE -4.12

Particulars No of respondents Percentage of respondents

Poor 78 38

Average 63 32

Fairly good 37 19

Very good 22 11

Inference

 It is found that majority of the respondents are not satisfied with the price 38
percent consider it as a poor one.
 32 percent say price is some what average one.
 19 percent consider the price is good for the quality of the product.
 Only 11 percent say the price is a very good one they are satisfied with it.

51
 SATISFACTION LEVEL TOWARDS PRICE
CHART -4.12

11%

19% 38%

Poor
Average
32% Fairly good
Very good

52
 FACTORS INFLUENCING WHILE DECIDING TO BUY A
PRODUCT
TABLE- 4.13

Particulars No of respondents Percentage of

respondents
Sales representative 28 14

Offers and discounts 60 30

Advertising 72 36

Trade shows 20 10

Other 20 10

Inference

 14 percent of people feel that apart from the product sales representative play a
vital role.
 30 percent of people want offers and discounts other than the product itself.
 36 percent of people feel that advertisement plays a vital role.
 10 percent of people feel that trade shows are important other than the product
itself.
 And remaining ten percent of people consider other facts.

53
FACTORS INFLUENCING WHILE DECIDING TO BUY A
PRODUCT
CHART - 4.13

10% 14%

Sales
10%
representative
Offers and
discounts
Advertising

30% Tradeshows

Others

36%

54
 LEVEL OF PREFERENCE TO BUY THE PRODUCT
Table -4.14

Particulars No of respondents Percentage of respondents

Very high 6 3

High 30 15

Normal 82 41

Low 54 27

Very low 28 14

Inference

 41percent of respondents have normal preference level towards the product.

 15percent have high level of preference towards the product.
 3percent have very high level of preference.
 27percent of respondents have low level of preference.
 14percent of respondents have very low level of preference.

55
 LEVEL OF PREFERENCE TO BUY THE PRODUCT
Chart -4.14

90 82
80
70
Very high
60 54
High
50 Normal
40 30 Low
28
30 Very low
20
6
10
0

56
 CHI SQUARE TEST

RELATIONSHIP BETWEEN DISTANCE TRAVELED AND

PREFERENCE FOR CYCLES

Null Hypothesis
Ho – There is no significant relationship between Distance traveled and preference

Alternative Hypothesis
H1 - There is significant relationship between Distance traveled and preference

CHI TEST TABLE

Distance Very High High Normal Low Very Total

Traveled Low
<5 km 1 8 27 12 4 52
5 -10km 3 12 23 10 4 52
10 -15 km 1 6 18 12 5 42
15-20 km 1 3 11 14 7 36
>20 km 0 1 3 6 8 18
Total 6 30 82 54 28 200

Calculated value (CV) = ∑ (O-E)* (O-E)

Ei
= 35.54

Level of significance = 5%

Degrees of Freedom = (R-1)* (C-1)

= (5-1)*(5-1)
= 4*4
= 16

AT 16DOF and 5% level of significance, the table value is = 26.296

57
 OBSERVED EXPECTED (Oi – (Oi-Ei)
VALUE (Oi) VALUE Ei) *(Oi-
(Ei) Ei)/Ei
1 1.56 -0.56 0.20
3 1.56 1.44 1.33
1 1.26 -0.26 0.05
1 1.08 -0.08 0.01
0 0.54 -0.54 0.54
8 7.8 0.2 0.01
12 7.8 4.2 2.26
6 6.3 -0.3 0.01
0 5.4 -5.4 5.40
1 2.7 -1.7 1.07
27 21.32 5.68 1.51
23 21.32 1.68 0.13
18 17.22 0.78 0.04
11 14.76 -3.76 0.96
3 7.38 -4.38 2.60
12 14.04 -2.04 0.30
10 14.04 -4.04 1.16
12 11.34 0.66 0.04
14 9.72 4.28 1.88
6 4.86 1.14 0.27
4 7.28 -3.28 1.48
4 7.28 -3.28 1.48
5 5.88 -0.88 0.13
7 5.04 1.96 0.76
8 2.52 5.48 11.92
TOTAL 35.54

Interpretation:

Calculated χ2 value is greater than the table value. So Null Hypothesis is rejected.
Therefore, there is significant relationship between distance traveled and preference for
E3 cycles

58
 CHI-SQUARE TEST
TO ANALYSE THE PURCHASE DECISION

Null Hypothesis
Ho: Customers does not consider the following factors while going in for the purchase of
the product
Alternative Hypothesis
Ha : Customers consider the following factors while going in for the purchase of the
product.

Table 4. :
FEATURES NO.OF E (O-E) (O-E)²
RESPONDENTS

Quality 56 50 6 36

Price 96 50 46 2116

Brand Name 28 50 -22 484

Features 20 50 -30 900

Total 200 200 0 3536

(O-E)² = 17.98
E

59
γ2 = 17.98

Degree of freedom = ( n-1 )

5-1 = 4
The Table Value for 4 degree of freedom at 5% level of significance is 9.448

Calculated value > table value

i.e. 17.98 > 9.448

Therefore, we reject the null hypothesis.

INFERENCE.
The degree of freedom for 4 is 9.448; the calculated value is 17.98, since the calculated
value is greater than the table value. The null hypothesis is rejected. Hence the customers
consider the following factors while going in for the purchase of the product

60
 TO ESTIMATE THE RELATIONSHIP BETWEEN INCOME AND
SATISFACTION LEVEL FOR PRICE OF THE PRODUCT
USING CORRELATION ANALYSIS

TABLE 4.40 – ESTIMATING THE RELATIONSHIP BETWEEN INCOME AND

SATISFACTION LEVEL FOR PRICE OF THE PRODUCT USING
CORRELATION ANALYSIS
PRICE NO OF INCOME LEVEL NO OF
RESPONDENTS RESPONDENTS
Poor value 78 <10000 54
Average value 63 10000-20000 69
Fairly good value 37 20000-35000 48
Very good value 22 >35000 29
Total 200 200

TABLE 4.41 – CORRELATION ANALYSIS BETWEEN INCOME AND PRICE

x x- ( x - )2 y y- ( y - )2 ( x-) ( y-)

54 4 16 78 28 784 112
69 19 361 63 13 169 247
48 -2 4 37 -13 169 26
29 -21 441 22 -28 784 588
200 0 822 200 0 1906 973

= 200/4 = 50 = 200/4 = 50

r = 975/√822 * 1906

= 975/1251 = 0.77

Interpretation
There exists a strong positive relation between Income and thought about price

61
 WEIGHTED AVERAGE FOR RANKING THE SERVICE
OREINTED ATTRIBUTES

TABLE 4 - TO ESTIMATE THE WEIGHTED AVERAGE OF E3

CYCLEORIENTED ATTRIBUTES
Highly Satisfied Neutral Dis-satisfied Highly dis-
satisfied satisfied
Rank 1 2 3 4 5
A good 8 50 99 36 7
value
Well built 11 83 76 26 4

A brand I 13 82 87 16 2
can trust
Price 8 82 78 18 14
High quality 34 63 78 15 10

TABLE – A good value

VALUE 8 50 99 36 7
WEIGHT 5 4 3 2 1
TOTAL 40 200 297 72 7

W.A.M= 616/200 = 3.08

TABLE – WELL BUILT

VALUE 11 83 76 26 4
WEIGHTS 5 4 3 2 1
TOTAL 55 332 228 52 4

W.A.M = 671/200 = 3.355

62
 A BRAND I CAN TRUST

VALUE 13 82 87 16 2
WEIGHTS 5 4 3 2 1
TOTAL 65 328 261 32 2

W.A.M = 658/200 = 3.29

TABLE – PRICE
VALUE 8 82 78 18 14
WEIGHTS 5 4 3 2 1
TOTAL 40 328 234 36 14

W.A.M = 652/200 = 3.26

TABLE – High quality

VALUE 26 82 69 14 9
WEIGHTS 5 4 3 2 1
TOTAL 130 328 207 28 9

W.A.M = 702/200 = 3.51

FACTORS WEIGHTED AVERAGE RANK

A good value 3.08 5
Well built 3.35 2
A brand I can trust 3.29 3
Price 3.26 4
High quality 3.51 1

Inference

The table shows that the factors of the E3 cycle, based on high quality(78) respondents
are neither satisfied nor dissatisfied. 83 of the respondents say the product is well build
and satisfied. 87 of the respondents say their have neutral level of trust towards brand. 83
respondents wear satisfied with the price of the cycle, 99 of the respondents say it has
good value.

63
 FINDINGS

 It is found that majority of the people are having idea about the Ti cycles. So as a
brand it has a good reach among the public.

 It is found that majority of the respondents around 64% are using the cycle for
education purpose, so mainly cycle users are youngsters.

 Majority of the people that is 46%of the people say that quality is the first thing
which comes to their mind when they hear of the company name Ti cycles.

 Majority of the people who are using the cycle are men.

 Regarding purchase decision it is mainly based on the price. Majority of the

people 48% consider price as the first thing before taking any purchase decision.
Next to price only other things like Quality, Brand name and Features come.

 Only the person who are using the cycle for postal services travel a lot when
compared to others.

 The awareness about the product Hercules E3 cycle is very low. Many people do
not have any idea about the cycle. Only 30%of the people were having knowledge
about the cycle before my explanation.

 Warranty plays major roles nearly 40% percent of people believe that they will go
for cycle only when they have cent percent warranty for that.

 The most powerful influencers are the youngsters as the majority 64% are using
the cycle.

64
 The concept of electronic cycle is welcomed by many people it is a good sign for
the product.

 Demo plays a major role in this product. As it is a new product many want to have
a trial of it. Nearly 84% of people feel that they should have a demo before
making the purchase.

 Many feel that offers and discounts are very essential. Nearly 30% of people feel
that they need offer and discount in addition to the product.

 Advertising plays a vital role. Many were asking the same question like we have
not seen the product in advertisement itself. 36% people say that their purchase
decision is based on advertisement also.

 Price is a major barrier many feel that it is priced heavily.

 The awareness towards company is significant but the awareness towards the
product is not significant.

 Respondents were very happy with the quality of the product but they feel that
price is little high.

 Respondents also feel that there is no advertisement which is a main reason for
less awareness towards the product.

 There is a significant relationship between the distance traveled and preference

towards cycle .Hence they should target the people who travel a lot.

 People rate this cycle as a high quality one so it is a good sign for the product.

65
 There is also a strong relationship between the income and thought about the
preference for the product.

66
 SUGGESTIONS

 Since the concept is liked by many people they have to focus mainly on that they
should try to reach the market with the help of that.

 The majority of the consumers constitute the youngsters so targeting them and
fulfilling their needs with best quality will have the profitable results.

 Since the awareness level is very low steps have to be taken to bring awareness.
They should bring more advertisements, more trade shows etc.

 It is a new concept hence the company should give a demo about the product so
that many will have an idea about the cycle. It is also one of the sources to bring
awareness.

 Pricing plays a major role, the main problem which is faced by the product is its
price hence they have to try to make some alterations in it so that they can reach
the market easily.

 Many introductory offers and discounts must be given to capture the market for
this product. Being a new market offers and discounts will help to increase the
sales and it will help in capturing the market potential.

 They should try to bring down the cost of the product so that they can attract
many customers .Mainly steel is used as a raw material for production of cycles
which is a very costly one they can take steps to replace it with plastic so that the
cost will come down.

67
 CONCLUSION

I believe that it is little difficult for the product E3 to capture the market.
But it doesn’t mean that it is not having market potential definitely there is a good
potential for the product as the consumers are waiting eagerly for the technology and
innovative things. They have to grab the market with different marketing strategies at low
cost. The innovative product is really a good one they should take proper step to make it a
successful one. Finally I would like to conclude by thanking everyone who made me to
explore to such a fantastic market research.

68
 BIBLIOGRAPHY

BOOKS REFERED

 DR. C. R. KOTHARI, “RESEARCH METHODOLOGY”, New age International

Publishers, Second revised edition 2006.
 DR. G. C. BERI, “MARKETING RESEARCH”, First edition.

COMPANY DETAILS

 TUBE INVESTMENTS OF CYCLE LIMITED, CHENNAI.

WEBSITE

 www.marketresearch.com
 www.marketfinder.com
 www.blonnet.com

69
QUESTIONNAIRE ON MARKET POTENTIAL FOR HERCULES E3
CYCLE.

1) Name:
2) Age:
a) 15-20 b) 20-25 c) 25-30 d) Above 30

3) Gender:
a) Male b) Female

4) What is your monthly salary range?

a) Below 10,000 b) 10,000-20,000 c) 20,000-35,000 d) Above 35,000

5) What is your Occupation?

a) Employed b) Professional c) Post man d) Student e) Others

6. What comes to your mind when you hear of TI cycles?

a. Quality b. Price c. Reliability d. Others

7. For what purpose you are using the bicycle?

a. Education b. Postal services c. Household purpose d. others

8. How much distance will you travel per day?

a. < 5 km b.5-10 km c.10-15 km d. 15-20 km e. >20

9. Mainly your purchase decision is based on?

a. Quality b. Price c. Brand name d. Features

70
10. Are you aware of E3 cycles?
a .Before my explanation b .Only after my explanation

11. Please tell us how you would rate E3 on the following attributes.

1 2 3 4 5
A good value
Expensive
A brand I can trust
Well built
High quality

12. What is your reaction to the new concept electronic cycle?

a. Poor
b. Good
c. Very Good
d. Excellent

13. What you think about the price of the cycle?

a. Poor value
b. Average value
c. Fairly good value
d. Very good value

14. What percentage does warranty influence you to buy the cycle?
a.25% b.25% to 50% c. 50% to 75% d. 75% to 100%

15. Whether you like to have a demo about the cycle before making a purchase?
a. Yes b.No

71
16. Other than the product itself, which of the following would most influence you when
deciding to buy a product?
a. Sales representative
b. Offers and discounts
c. Advertising
d. Trade shows
e. Other

17. Your level of preference to buy the product

a. Very high b. High c. Normal d. Low e. Very Low

72