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‘ 

DR. N. N. SHARMA
(ASSIGNED FACULTY)

‘ 

GAURI SAHU
PGDBM, 1ST TRIMESTER
ROLL NO:- 23/D/2009

  

08.09.2009
INTRODUCTION
Established in the year 1920, Kansai Nerolac Paints Limited (KNP) is
headquartered at Mumbai. KNP is a subsidiary of Kansai Paint Co. Ltd., Japan
(KPJ) a leading Japanese paint company.KPJ holds 69.27% shares in KNP . KNP
serves its vast customer base through its four strategically located factories at
Jainpur in U.P., Lote in Maharashtra, Perugundi in Tamil Nadu and Bawal in
Haryana as well as 65 sales locations. KNP is in the process of putting up its
fifth unit in Tamil Nadu. The managing Director of the company is | 
  |
    

KNP has a good name in the market being number one in the industrial,
automotive and Powder coating business. KNP is known for transformation,
innovation and style and has consistently been producing good re sults. Being
the fore runner in introducing new products, finishes and new technologies to
the market, taking the platform of innovation, KNP products and finishes enjoy
good brand image and its brands like ͚Impressions͛, ͛Beauty͛, ͚Excel͛, ͛Suraksha͛
are well trusted by the consumers.

÷  ÷


In 1920, Nerolac was started in as Gahegan Paints &Varnish Co.Ltd. in Bombay.


In 1933, Lead Industries Group Ltd. acquired entire share capital of Gahegan
Paints &Varnish Co.Ltd and was known as Goodlass Nerolac Paints Ltd.
Gradually in 2006, on 11 th of July, Goodlass Nerolac Paints Ltd. name has been
changed to Kansai Nerolac Paints Ltd. During the journey of continuous
performance excellence they have entered in too many technical collaboration
with other industry such as E.I. Du-Pont de Nemours &Co. Ltd, USA and Oshima
Kogya Co. Ltd, Japan for their different products. Their incessant journey of
success is going on their present human asset of over 2000 professionals and a
sales turnover of Rs 1484 crore. They are esteemed to be a subsidiary of Kans ai
Paint Co. Ltd., which is the largest paint manufacturing company in Japan &
among top ten coating companies of the world . They are the 2 nd largest coating
company in India with a market share of over 20%. They are the market leader
in industrial/automotive segment supplying over 90% of the OEM requirement.



÷   
Nerolac has two broad types of productsͶdecorative coatings and industrial
coatings. Decorative Coatings consisted of three products of decorative, auto
paints and wood coatings. Industrial coatings consisted of Original Equipment
Manufacturer (OIM) and protective coating. Further they can be classified as ---
Decorative Coatings
Interior-Nerolac͛s range of Decorative paints for inner walls
Ë âater based Paints
-Emulsions
-Distemper
Ë Solvent Based Paints
-Lustre
-Enamel
-Flat oil
Exterior- Nerolac͛s range of Decorative paints for building exteriors.
Ë Emulsions
Ë Textured
Ë Cement
Ë Nerolac Impressions Everlast
Industrial coatings
Ë Coating solutions for Bus, Load & Trailer Bodies
Ë Coating for drums and barrels, cylinders, beverage containers,
collapsible tools, crown & caps.
Ë Coil coatings for steel and aluminum substrates.
Ë Coatings for plastic substrates ranging from TV cabinets & Mobile
phones.
Ë Coatings conforming to IS, Defence & Road transpo rt specifications
Ë Coatings for cycle, helmets & furniture industry, etc..
Automotive Coatings of Kansai Nerolac have been tested and certified
by global automotive manufactures who have set up base in India, like
Suzuki Motors, Honda Motors, Toyota Motors, General Motors,
Corporation, IVECO Motors, Peugeot.



÷
   

Manufacturing is a very important function for the paint industry. Nerolac


has made sure that its manufacturing units located at Perungudi(T.N),
Jainpur((U.P), Lote Parshuram(Maharashtra) & Bawal(Haryana). The fifth
factory is planned at Hosur in Tamil Nadu. The total installed capacity of all
the existing units put together is 173900 MT/Annum. Its latest unit is at
Bawal which was commissioned in March 2005, with a capacity of 20400
TPA with an investment of around Rs.100 crore- all through internal
accruals.



÷ 

There are many sub-products of Nerolac Paints. The features of some of
them with price list are given in Table 1.

INTERIOR EMULSIONS 20 Lt 10Lt 4Lt 1Lt


-Rs- -Rs- -Rs- -Rs-
Nerolac Beauty Gold (âonder âhite) 2931.00 1523.00 644.70 168.90
Nerolac Beauty Silver (âhite) 2070.00 1087.00 457.50 117.20
Nerolac Beauty (âhite) 1285.00 702.50 313.00 85.30
EXTERIOR EMULSIONS 20 Lt 10Lt 4Lt 1Lt
-Rs- -Rs- -Rs- -Rs-
Nerolac Excel Total (âhite) 3900.00 2080.00 860.00 224.00
Nerolac Suraksha Advanced (âhite) 2100.00 1100.00 460.00 120.00
Nerolac Suraksha Plus (âhite) 1643.00 903.50 385.00 101.40
ENAMELS 20 Lt 10Lt 4Lt 1Lt
-Rs- -Rs- -Rs- -Rs-
Nerolac Satin Enamel (âhite) 2710.00 1420.00 591.00 157.50
Nerolac Synthetic Flat Paint Interior 2584.00 1359.00 562.50 147.00
(âhite)
NEROLAC PRIMERS 20 Lt 10Lt 4Lt 1Lt
-Rs- -Rs- -Rs- -Rs-
Nerolac cement Primer (âhite) 1625.00 878.00 377.50 103.40

÷    ÷ 
÷


Overheads were kept under control. Overall as a percentage to sales was more
or less at the same level as compared to the last year. Profit Before
Depreciation, Interest and Tax (PBDIT) for the year is lower at Rs. 157.44 crores
as against Rs. 186.55 crores of previous year reflecting a degrowth of 15.6%.

Table 4 :

I terest
De reciatio   
   ÷  Paid
2% Divide d 0%
Retai ed Ear i gs Cor orate Tax 2%
4% Ma ower Cost 3%
4%
Excise Duty
12%
Materials
53%

erati g
ex e ses
20%
.

   
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At Nerolac, the marketing function has been one of the pillars behind
building a successful organization. They believe that their key strength lies in
understanding the consumer. Nerolac commercials have been well ʹloved ovr
the years and its jingle ʹ͚è   
   ͛ Is now a familiar
tune in every Indian household.
Over the years, Nerolac has undertaken several initiatives, which have made
unprecedented success. Beginning with the introduction of the new Brush
stroke logo, which stands for the process of painting? It depicts motion,
dynamism and progress through change. The signal red color which is the color
of Nerolac, is symbolic o eternal joy and hope. It has now become an integral
part of the brand identity and now appears as a sign-off on any kind of
communication. ?
Another one of the marketing initiative was the unveiling of the new
corporate campaign with Mr. Amitabh Bachan as the brand ambassador and a
new baseline come into being i.e, ü                 .
Another one of the initiatives launched, during the festival season in Diwali
was ͚Har Din Diwali͛.
     

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Ë In order to increase customer involvement in the paint buying process,
KNP had decided to set up Experience Centers . These centers were
aimed at creating the appropriate retail experience by giving consumers
and influencers an opportunity to touch and feel the product and finish.
At, the end of March 2009, Nerola had a total of nine stores, across the 3
cities of Hyderabad, Bengalooru and Chennai. It will increase in numbers
in coming years.
Ë Continuing with the platform of initiatives, ͚ Nerolac Impressions Shopee͛
a ͚shop in shop͛ format of retail sources, was inaugurated in Nagpur this
year. The store is facilitated to provide one stop shop painting solutions
for the consumers, which will help them in choosing the right products,
finishes and colour combinations. This is also well supported by our
͚Home Stylers͛ Service.
Ë The company will continue to work closely with key players in the Auto
Industry in offering various value additions and new technology products
to ensure high value and repeat business.


  ÷    

The leading players in the market frequently undertook brand building


interventions through improvement in attributes, benefits, package,
advertising, and sales promotion in order to enhance brand equity. The
competitors of Kansai Nerolac are Asian Paints, ICI India, Berger Paints,
Shalimar Paints, Jenson & Nicholso and Snowchem India. Nerolac Paints ranks
fourth position in the market.

Further, the paint market is divided into two partsͶLow End & High End.
The classification is shown in the Table 5

Table 5 :

÷÷           

Brand Name Berger Paints, Shalimar Asian Paints, Nerolac Paints,


Paints, Snow chem India, ICI India
Jenson & Nicholso
Products Enamel, primers, Distemper Enamel, Industries, âood
Coatings
Qualities Low Price, Poor Durability High Price, High Durability

This shows the differences between the Market Competitors. Nerolac Paints
produce A to Z products in the market. According to the consumer survey, the
toughest competitor of Nerolac Paints is Asian Paints.

There is high demand for the product in the market but Nerolac launched the
entire Decorative Product Range as ͚lead free͛ product which is harmless and
good for the health. there are also govt. market who wants to buy low price
with poor durability. The products like Roof paint, Auto paint etc. are not
produced by Asian paints. So these features help Nerolac to grab the market.
The market share of various brands is shown in Table 6

Table 6 :
Sales Turnover Rs
  Asian Paints 4270.05
II India 908.65
Asian Paints Kansai
Nerolac 1375.63
I I India
Berger
Kansai Nerol
Paints 1513.74
Berger Paints Shalimar
Shalimar Pain Paints 334.30
Jenson Nicho
Jenson
Nicholso 37.47

 

 
   
Nerolac͛s strength of wide spread distribution network is its right arm in
generating sales revenue from all parts of India. Nerolac has a wide distribution
network of over 11000 dealers. They have eight Sales Divisions and each
division has depots to take care of local needs. In all they have 66 depots . All
this ensures complete reach in India including rural and up country markets.

In the North-Eastern region there are sales manager who looks after the
sales of the company. The dealers are having a Dealers Net Price (DNP) in
which they get some rebate from the branch office . There were different
schemes provided by the company for fulfilling sales target on differ ent
products in different period of time. The overview of the rebate schemes by
the branch office and the company are shown in Table 2 and Table 3
respectively.

There are no any intermediaries in dealing with the ultimate customers . The
wholesalers and retailers are confined to dealers and the dealer cost is passed
to the consumers. The salesman visits the dealers, project sites, construction
sites. They also have contacts with the architects, interior designers, painters
who are the influencers of the consumers and visit them regularly. The regular
visit ensures that they always good contact with the consumers and
understand the sales strategies.

Table 2 : Monthly Product rebate scheme for the month of August͛09

PRODUCT On bill Achieve your L.Y 20% LY value


rebate per Value Base or Rs. Growth or
ltr/kg 25000 whichever 30000/=whichever
is higher and get is higher by month
credit note Per and get credit
Ltr/Kg note Per Ltr/kg
NSE 5.00 2.00 2.00
BPAE 5.00 2.00 1.00
MELAMINE 3.00 2.00 1.00

Table 3 : The scheme period is 1 st July ʹ 31st Dec 2009

POINTS CHOOSE TO âIN


225000 Hyundai Getz Prime 1.1 GL
175000 Tata Indica V2 Xeta GL
125000 2 Tickets for Beijing & Shanghi ʹ 4N5D etc.

÷ 
   ÷  

In the survey on consumer awareness on Nerolac Paints, the different opinions


of consumers on different dimensions come into being. The survey is done in
two partsͶthe age group between 20-25 years and the age group between 30 -
35 years.

The age group between 20-25 years who are the future generation of the
use of Nerolac Paints is much more attracted towards Asian Paints. The
Nerolac likings as a product is less than an half as a decorative use in
households. They were quite concerned about Asian Paints which gets a huge
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÷    

1)  The company should give more importance to advertisement available from
various sources like newspaper, hoardings, magazines, radio etc..
2)  The price structure is in level. For a good quality product the price would be
obviously higher. But it should change to a little bit of margin to cope up
with competitors.
3)  More instruction should be given to the dealers for the promotion of the
product. They can play as role of influencer and can increase the number of
sales and lead the company towards profit.
4)  The shade of colours is good. The company should update the consumer͛s
choice according to the need of time and sustain the advantage.
5)  The company should keep a record of the competitors and make required
changes looking at the market share. New steps should be taken to grab the
market.

÷ ÷
 

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÷ NTENTS

wIntroduction

wCompany Background

wProduct Portfolio

wManufacturing Strength

wProduct Features

wCost & Price Structure

wPromotion

wMarketing Strategy

wMarket Competition

wFindings ʹ Distribution System

wConsumers͛ Perception

wRecommendations

wConclusion

wQuestionnaire
c÷KN EDGEMENT

This is an assignment on Marketing Management of Marketing


Analysis of a brand named Kansai Nerolac Paints. This is done to have
a detail analysis and understand the different aspects and
approaches of marketing.

I acknowledge with gratitude to Mr. Ajoy Sahu who helped me in


contacting the Marketing Professionals of Kansai Nerolac Paints and
fixed the appointment. Mr. Ajoy Sahu, being a dealer, also helped me
in getting informations about Nerolac Paints.

I must also acknowledge the contribution of Mr. Dilip Borthakur,


the Branch Manager of Guwahati of Kansai Nerolac Paint. Mr. Dilip
Borthakur with his substantial practical knowledge enhanced my
understanding of the subject matter.

Finally, and most important, many thanks to all of my respondents


who supported me in answering my Questionnaires.

GAURI SAHU