INGERSOLL RAND

MADE BY:-
PRIYA BHATTACHARYA
JN180106
INGERSOLL-RAND
Marketed three types of Compressors
 Reciprocating (recips)
 Rotary screw (rotaries)
 Centrifugal
Range: 3/4 to 6000 housepower (hp)
I-R Air Compressor: OEMs & User- Customers
Industry Covention
 Small (below 25hp)
 Medium (25 to 300 hp)
 Larger (above 300 hp)
STATIONARY AIR COMPRESSOR
DIVISION
 16 Countries, sales offices in 40 countries and distribution arrangements in 80
others
 DSM: Sales to users of all centrifugal compressors
 DSM organization included five regional managers and two industry managers
Five parts salespersons solely responsible for sale of parts to the company’s
large direct customers
 Independent Distribution Manager(IDM): Sold reciprocating
compressors below 250hp and rotary compressors below 450 hp
 ACM were two regional managers each of whom supervised seven area
managers
 SM directed a team of direct field service supervisors
 Other Players – 10-12% Marketing
 Joy (Centrifugals)
 Sullair (Rotary)
 Atlas Copco (Stationary)
How & Why should Ingersoll-Rand distribute
Centac-200?
ABOUT THE PRODUCT
 200hp centrifugal compressor
 Spare parts requirement very low
 Operates at very high speeds 50000rpm
• Provides “oil-free” air unlike recips and rotaries
 Inadequate repair carried risk of serious damage

FACTORS
 A medium range product falling in 25-300hp bracket.
 Overall market : $35million
 Low Spare Part requirement
 High Technical Support Requirement
 Intensive distributor training needs to be provided
 Independent
Parameters Direct Sales Force Air Centers
Distributors
Recips > 250 hp,
Recips < 250 hp & Recips < 250 hp &
Product Type rotaries > 450 hp & all
rotaries < 450 hp rotaries <450 hp
centrifugals
Sales revenue generated
35% 30% 20%
(%)

Cost to company 11% 21% 19%

Experience with Highly competent

Centrifugals
No prior experience No prior experience
technical selling

• Well established • Well established • Useful in areas where

service capabilities network. distributors were not
• Good addition to the • Consistent with successful
Advantages shrinking line the hp portfolio

• Sales force tend to • Attention away • Apprehension in the

become ‘elephant from the minds of distributors.
Disadvantages smaller
hunters’
compressors.
• Partial attention to
• Distributor
Centec 200 training is
required.
How should distributors benefit from
Centac-200?How about the Sales Force?
Product they sell: Recips < 250hp & rotaries < 450hp
 Increase in revenue and profits of distributor
Established network: Worked in the benefit of the distributors
 Focused attention to Centac-200
 Easy accessibility and serviceability
 Competitor’s Atlas Copco’s product Z series is currently being sold through
distributors
 From the Full Partner Program the distributor could earn commissions for
referring enquiries to the direct sales repand on conversion they could earn a
2% commission on a lead and 5% in case of active involvement in sales
 Cost Analysis

Cost of Centac- 200 =$225*200= $45000

=12% of $45000
Installation Cost $5400

=2% of $45000
Spare Parts and Maintenance Cost $900

=15% of $45000
Gross Margin on Compressors $6750

=30% of 900
Gross Margin on Spare Parts $270
OMNI CHANNEL ENVIRONMENT
 Customer- focused framework showing to win in the Omni-channel
environment
 Omni channel can be defined as an emerging approach to channel integration
that aims to deliver seamless customer experience through every possible
channel a retailer or brand can connect with their end consumers
CHALLENGES:
 A big challenge comes with recognizing the shopper and their unique profile in
an Omni channel environment
 The 360 degree customer view: What it is and why it’s important
 Different attribution models and the value of each
 Direct Sales Distributors Air Centres Manufacturer’s
Force Reps

Nature of the • All Centrifugals • Recips below 250 • Recips below • Recips 5 hp and
product • Recips 250 hp hp 250hp below
and above • Rotaries under • Rotaries under • DIY Products
450 hp 450 hp
• Rotaries 450 hp • Technical and • Distributed
(do-it-yourself)
and above service support Ingersoll-Rand
products only

Buyer Behavior • Products that • Large customers • Buyer behaviour is • People who use the
requires high that had relatively less complex and compressors for small
degree of technical sophisticated specifications less jobs. (Mainly small
demanding. contractors and
expertise and buying behaviour. • Target: Small and plumbers).
coordinated sales medium machines.
effort

Cost to Company • 11% of Total Sales • 21% of Sales • 19% of Sales • Paid 3%
• Sales • Invoiced at 20% • Invoiced at 20% Commission on
Representatives off list price off list price Sales
were paid a
commission of 1-
3%
Will Web Change the multiple channel
strategy?
Challenges:
 Channels competing with each other at times to complete a sale
Solution:
Full partner program
 Independent distributors and Air centres perceived the other as receiving
favoured treatment
 Distributers contended air centres got better prices, information and service
since owned by the company
 Air centres contended that the sales territories were exclusive and air centres
had territories with poor potential