SYPNOSIS

PROJECT REPORT

ON

“TRANSPOTATION MARKETING”

SUBMITTED BY:SUBMITTED BY:

NILESHKUMAR D. SHUKLANILESHKUMAR D. SHUKLA

UNDER THE GUIDANCE OFUNDER THE GUIDANCE OF

Prof:- Prof:- KRUNAL SIRKRUNAL SIR

SAKET COLLEGE OF MANAGEMENTSAKET COLLEGE OF MANAGEMENT

KALYAN, MAHARASHTRA, INDIAKALYAN, MAHARASHTRA, INDIA

UNIVERSITY OF MUMBAIUNIVERSITY OF MUMBAI

(2013-2014)(2013-2014)

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Declaration

I Mr. NILESHKUMAR D. SHUKLA NILESHKUMAR D. SHUKLA hereby declare that the

project entitled “TRANSPOTATION MARKETING” carried out at

SAI PRASAD TRANSPORTS is a genuine work of MMS SUMMER

INTERNSHIP (Marketing) .

To the best of my knowledge any part of this context has not been

submitted earlier for any Degree, Diploma or Certificate Examination.

N NILESHKUMAR ILESHKUMAR D. SHUKLAD. SHUKLA

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ACKNOWLEDGEMENT

I owe my gratitude to SAI PRASAD TRANSPORT Navi Mumbai for providing me the opportunity to training, especially Mr. RANJEET YADAV, Regional Manager for allowing me to work on the project.

It is my foremost duty to express my deep sense of gratitude and respect to Branch Manager Mr. RAJESH SINGH for his valuable guidance as well as for mentoring me, taking active interest throughout the project, sharing his insights on the topic and for being a constant source of inspiration.

I would like to give sincere thanks to everyone in SAI PRASAD TRANSPORTS, for their extreme help, self guidance, cooperation and friendliness; they did it in one way or other for successful completion of the project. I am greatly acknowledged by their kind help.

N NILESHKUMAR ILESHKUMAR D. SHUKLAD. SHUKLA

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OBJECTIVE OF THE PROJECT

The main objective of filed survey during the project was to find out the

market share of the LG and also calculate the display share.

Find out the positional dealer who can sale the LG product in large

volume.

The main objective of research was to identify potential dealer and

development these dealer. So LG can make them their direct dealer.

This will ease the dependence on the some big dealer like Maharashtra

and Mahaveer electronics.

Find out the problem faced by the dealer in sales and the distribution.

The Objective was to find out that how far the exhibitions are helpful in

branding,

While purchasing the consumer durables which parameter is most

important for the consumer?

Do the consumers prefer the financial facility for buying consumer

durable?

How frequently consumers change the consumer durable?

To enhances the knowledge of consumer durable market.

To enhances the knowledge about the marketing and branding activity.

Allwyn, and Voltas were the major players in the consumer durables market,

accounting for no less than 90% of the market. Then, after the liberalization,

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foreign players like LG, Sony, Samsung, Whirlpool, Daewoo, and Aiwa

came into the picture. Today, these players control the major share of the

consumer durables market.

Consumer durables market is expected to grow at 10-15% in 2007-2008.

It is growing very fast because of rise in living standards, easy access to

consumer finance, and wide range of choice, as many foreign players are

entering in the market

With the increase in income levels, easy availability of finance, increase in

consumer awareness, and introduction of new models, the demand for

consumer durables has increased significantly. Products like washing

machines, air conditioners, microwave ovens, color televisions (CTVs) are

no longer considered luxury items. However, there are still very few players

in categories like vacuum cleaners, and dishwashers

Consumer durables sector is characterized by the emergence of MNCs,

exchange offers, discounts, and intense competition. The market share of

MNCs in consumer durables sector is 65%. MNC's major target is the

growing middle class of India. MNCs offer superior technology to the

Consumers whereas the Indian companies compete on the basis of firm grasp

of the local market, their well-acknowledged brands, and hold over wide

distribution network. However, the penetration level of the consumer

durables is still low in India.

Classification of consumer durables sector

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1. Consumer electronic include Vcd/Dvd, home theatre, music player, color

television (CTVs), cameras, camcorders, portable audio, Hi-Fi, etc

2. White goods include dishwashers, air conditioners, heaters, washing

machines, refrigerators, vacuum cleaners, kitchen appliances, non-kitchen

appliances, microwaves, built-in appliances, Tumble dryer, personal care

product etc.

3. Moulded luggage include plastics

4. Clocks and watches

5. Mobile phones

Scope:-

1. In term of purchasing power parity (ppp), India is the 4th largest economy in the world and overtake Japan in the near future become the 3rd largest.

2. Indian consumer durable market is expected to reach $400 billion by on 2010

3. India has the youngest population amongst the major countries. There are lot of people in the different income categories nearly the two third population is below the age of 35 and nearly 50% is below 25.

4. There are 56 million people in middle class, who are earning us$4,400-US$21,800 a year. And there are 6 million rich household in India.

5. The upper-middle and high-income household in urban areas are

expected to grew to 38.2 million in 2007 as against 14.6 million in 2000.

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Opportunity :-

1. In India the penetration level of white goods is lower as compared to

other developing countries.

2. Unexploited rural market.

3. Rapid urbanization.

4. Increase in income level, i.e. increase in purchasing power of consumers.

5. Easy availability of finance.

Threats:-

Higher import duties on row materials.

Cheap imports from Singapore, China and from other Asian countries.

Brands in consumer electronics sector:

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MNCs NATIONAL REGIONALLG )SAMSUNG ) KOREA ONIDA BUSHHYUNDAI ) VIDEOCON CROWN

BPL SALORATCL ) CHINA GODREJ T-SERIESHAIER ) VOLTAS WESTON

IFB BELTAKPHILIPS ) HOLLAND OSKAR

PANASONIC )SHARP )HITACHI )SANSUI ) JAPANAKAI )AIWA

WHIRLPOOL )ELECTROLUX

TODAY Consumer durables sector is characterized by the emergence of

MNCs, exchange offers, discounts, and intense competition. The market share

of MNCs in consumer durables sector is 65%. MNC's major target is the

growing middle class of India. MNCs offer superior technology to the

LG, SAMSUNG the two Korean companies has been maintaining the

lead in the industries with LG being leader in almost all the categories.

The company, having a turnover of Rs 9,500 Cr and market share of 26 per

cent, is investing Rs 360 Cr on brand-building and other marketing initiatives

and around Rs 140 Cr on research and development, besides launching new

platforms in information technology and related areas,

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LG Electronics is one of the leading companies in the field of electronics with

a global presence in many countries. . Before briefing, I have divided the

introduction part into three main sub parts.

1. LG Global

2. LG India

3. LG Mumbai

History of company:-

The company was originally established in 1958 as Gold Star, producing radios,

TVs, refrigerators, washing machines, and air conditioners.

The LG Group was a merger of two Korean companies, Lucky and Gold Star,

from which the abbreviation of LG was derived. The current "Life's good"

slogan is a backronym. Before the corporate Name change to LG, household

products were sold under the Brand name of Lucky, while electronic products

were sold under the brand name of Gold Star. The Gold Star brand is still

perceived as a discount brand.

In 1995, Gold Star was renamed LG Electronics, and acquired Zenith

Electronics of the United States.

Global Operation

LG Electronics is playing an active role in the world market with its assertive

global business policy. As a result, LG Electronics controls 110 local

subsidiaries in the world with around 82,000 executive and employees.

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LG Group

1. LG.Philips LCD

2. LG Chemical

3. LG Telecom

4. LG Powercom

5. LG Twins

6. LG Dacom

Business areas and main products

Mobile communications

(a)CDMA Handsets,

(b)GSM Handsets,

(c) 3G Handsets,

(d)Cellular Phones

Digital appliance

a) Air Conditioners,

b) Refrigerators,

c) Microwave Ovens,

d) Washing Machines,

e) Vacuum Cleaners,

f) Home Net,

g) Compressors for Air Conditioners and Refrigerators

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Digital display

a) Plasma TVs,

b) LCD TVs,

c) Micro Display Panel TVs,

d) Monitors,

e) PDP Modules,

f) OLED Panels,

g) USB Memory,

h) Flat Panel Computer Monitors

Digital media

a) Home Theater Systems,

b) DVD Recorders,

c) Super Multi DVD Rewriters,

d) CD±RW,

e) Notebook PCs,

f) Desktop PCs,

g) PDAs,

h) PDA Phones,

i) MP3 Players,

j) New Karaoke Systems,

k) Car Infotainment

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LG Electronics will do its best to create new products and services with an

open mind, while developing new technologies and business fields through

various associations with some of the world's most successful companies.

1. 3M

2. SUN

3. YAHOO

4. PHILLIPS

5. TOYOTA

6. MICROSOFT

7. HP

8. GOOGLE

9. GE

10.INTEL

11.NORTEL

12.HITACHI

13.PRADA

14.RENESAS

15.TOSHIBA

16.BESTBUY

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And the number follows many more…………………………..

In Feb. 2007 LG Electronics and Yahoo formed a strategic alliance. Yahoo

mobile services will be available from LG mobile. This service is targeting 10

million LG mobile phones in over 70 countries.

In Mar. 2007 LG Electronics and Google formed a strategic alliance.

Both companies will work together to release, market, and offer LG mobile

phones with Google services (search engine, map, email, and blogs.)

LG BRAND IDENTITY:-

The brand of LG is delightfully smart. LG strives to enhance the customer’s life

and lifestyle with intelligent features, institutive functionality and exceptional

performance.

The brand platform:-

The LG brand is composed of four basic elements –

1. Value

2. Promise

3. Benefits

4. Personality

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The Brands core Value that never changes.

a. Trust,

b. Innovation,

c. People

d. Passion

The benefits that are consistently delivered to the customer includes

Reliable products

Simple design

Ease of use

Extraordinary Experience

Personality describes the human characteristic that are expressed to the

customer through

Trustworthy, Considerate

Practical, Friendly

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The Internal Culture of LG:

LG practices four cultures

1. Learning Culture

2. Boundary less Environment

3. A Carrier

4. Growth

According to LG, the Learning Culture continuously helps the employee to

learn more and more to develop the habit of continuous learning.

Boundary less Environment means that there is no difference between the

levels of employees. There is transparency between the work and mutual

understanding between all the employees.

A carrier is highly growing in LG and one who is the employee can develop

their carrier largely. A new comer will feel fully comfortable in the company

and for a new comer the company is very helpful in the overall growth of

personality.

Growth in LG is very high for those who are in the company and for those who

want to join in LG. The company is growing with fast innovation and the BLUE

Ocean strategy is one of the examples of growth.

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Mission

The mission of LG is to provide the customers with utmost satisfaction through

leadership.

The fundamental policy of development is to secure product leadership that the

Customers may have the utmost satisfaction.

Product Leadership

We are focusing on six development areas to become the product leader.

1. New Machine

2. Reliability

3. Conventional Installation

4. Environment Friendly Product

5. Low Noise & Vibration

6. Energy Saving

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Quality Innovation:

The policy of quality assurance is to provide customers with utmost satisfaction

by supplying zero defects.

LG proceeds in a hierarchal manner. It is named as “LG WAY”.

From top to bottom:

No.1 LG – is the VISION

“Jeong-DO” Management is LG’s unique application to ethics. LG will

succeed through fair management practices and constantly developing our

business skill.

A) Honest with our customer

b) Providing great values to customer through constant innovation & and

development.

c) Equal opportunities

d) Equal Treatment

Management Principle - Creating value for customer

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Code of conduct of LG :

1. Responsibility and obligations to customers :• Respect for Customers• Creating Value • Providing Value•2 Fair competition• Pursuit of Free Competition• Compliance with Laws and Regulations

3 Fair Transaction :• Equal Opportunity • Fair Transaction Procedure• Support and Aid for Business Partners

4 Basic Ethics for Employees• Basic Ethics• Completion of Duty • Self Development• Fairness in Performance• Avoidance of conflict with company interest

5 Corporate Responsibilities to employees• Respect for human dignity• Fair Treatment• Promoting Creativity

6 Responsibilities to society and country

• Rational Business Development• Protection of stock holder interest• Contribution to social development• Environmental Conservation

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LG INDIA:

LG Electronics India Pvt. Ltd., a wholly owned subsidiary of LG Electronics,

South Korea was established in January 1997 after clearance from the Foreign

Investment Promotion Board (FIPB). LG set up a state-of-the art manufacturing

facility at Greater Noida, near Delhi, in 1998, with an investment of Rs 500

Crs.

LG corporate office is located at Plot no.51, Udyog Vihar, Kasna Road, Greater

Noida, India.

This facility manufactured Color Televisions, Washing Machines, Air-

Conditioners and Microwave Ovens.

''Company is setting up a chain of exclusive premium showrooms. LG plans to

launch 60 premium Brand Shoppes by the end of the first quarter of this year.

At present, LG has a total of 83 LG stores across the country, of which 45 are

shoppes and 38 are exclusive stores. Brand shoppes will be placed in the

premium segment and the target audience will comprise buyers interested in

premium and high end products.

LG Brand Shoppe goes beyond the concept of a normal exclusive store by

having a more interactive environment and additional lifestyle orientation on

display so that the customer can actually experience the LG products in his or

her own home settings.

LG Electronics India Ltd (LGEIL), consumer durables leader with 27% market

share, is planning a brand new image. To attract inspirational and young

consumers across India, company will roll out a new marketing strategy. The

exercise will cost the company Rs 360 Cr.

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LG Electronics India is the fastest growing company in the consumer

electronics, home appliances, and computer peripherals industry today.

LG Electronics is continually providing, superior technology products & value

for money to more than 50 lakh households in India. LGEIL is celebrating the

11th anniversary this year.

LG Soft India the innovation wing of LG Electronics in Bangalore is LG

Electronics' largest R&D centre outside Korea. We at LGSI focus on niche

technology areas such as mobile application development, digital video

broadcast and biometrics software and support LG Electronics with our

expertise. Motivated by a passion for technology, a strong work culture and

loyalty to the organization, we are determined to see LG become one of the top

three brands globally.

Prominent consumer electronic company, LG Electronics Inc. has said that it

expects the sale of its products in India to up by 15 per cent in 2008. Moon Bum

Shin, managing director of LG Electronics India has said that the company has

earmarked 4.8 billion rupees for investment purpose in India this year. The said

money will be used to market as well as manufacture new products.

LG Electronics, which is originally a South Korean Company with branch in

India, informed that its sales of GSM mobile phones, color televisions, air

conditioners and other household goods in the Indian market was to the tune of

95 billion rupees ($2.4 billion) in 2007. As per Shin's estimate, the sales in 2008

would be around 110 billion rupees.

In order to achieve its target, Shin said LG Electronics will concentrate on

catering to the high-end consumer market which will help boost sales this year.

India churns out six (6) per cent of LG Electronics global revenues of $42

billion. The Indian branch of LG exports to 40 countries.

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Challenges in India

The challenges faced by LG when entered in Indian market

1. Low brand awareness about LG in India.

2. One of the last MNCs entered in India (Samsung, Panasonic entered in

1995 in India).

3. High import duty

4. Compitition from local market players and other MNCs in consumer

durable segment.

5. Price sensitiveness of the Indian consumer

LGEI over comes these challenges to emerge as

Innovative marketing strategy

1. Launch new technologies in consumer electronic and home appliances.

2. LG was the first brand to enter in cricket in big way a way, by sponsoring

the 1999 world cup followed it up in 2003 as well.

3. LG brought in four captains of the Indian cricket team to endorse its

products. LG invested more then US$ 8 million on advertising and

marketing in this sport.

4. LG has differentiated its product using technology and health benefits.

CTV has “Golden eye technology” Air conditioner has “Health air

system” and microwave ovens have the “Health wave system”.

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Local and efficient manufacturing to reduce the cost

To overcome high import duties LG manufactures TV refrigerator in India at

manufacturing facility at Noida and Mumbai. LGEI had already commissioned

contract manufacturing at Mohali Kolkata and Bhopal for CTVs. This has

helped LGEI to reduce cost.

LGEI implementing the “Digital manufacturing system” (DMS) as the cost

cutting innovation this system is follow-up to the six sigma exercise LGEI had

initiate earlier.

R&D potential

LG has the research and development facilities in Bangalore and Mumbai. Both

the unit carry out R&D department for the domestic as well as the parent

company it also dose customize R&D for the specific countries to which it

export product.

Regional channel and wide distribution network

1. LG has adopted the regional distribution channel in India. All the

distributers work directly with the company. This has resulted in quicker

rotation of the stock and better penetration into B, C, D, class market.

2. LG also follows the stock rotation policy rather then dumping stock on

channel partners.

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Product localization:-

1. Product localization is the key strategy used by the LG

2. LG came out with Hindi and regional language menus on its TVs.

3. Introduced the low-priced “Cineplus” and “sampooma” for the rural

market.

4. LG was the first brand to introduce gaming in TVs in continuations of its

association with cricket LG introduce cricket game in CTVs

MAJOR KEY SUCCESS FACTORS

1. Innovative marketing - LG was the first brand to enter cricket in a big

way, by sponsoring the 1999 World Cup and followed it up in 2003 as

well.

2. Local and efficient manufacturing to reduce cost - To overcome high

import duties, LG manufactures PC monitors and refrigerators in India at

its manufacturing facility at Noida, Delhi.

3. Commissioned contract manufacturing at Mohali, Kolkata and Bhopal for

CTVs.

4. Product localization - Product localization is a key strategy used by LG. It

came out with Hindi and regional language menus on its TV.

5. Regional distribution model - This has resulted in quicker rotation of

stocks and better penetration into the B, C and D class markets.

6. Leveraging India’s IT advantage - LG Electronics has awarded a contract

to develop IT solutions to LG Soft India (LGSI). The project involves

development and support for ERP, SCM, CRM and IT-enabled services

for LG.

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Strategies adopted by the organization

LG follows 10 commandments which are as follows.

1. Foster working environment-5S Environment

2. Fast execution is key to success

3. Transparent and fast communication-open communication

4. Update market -knowledge –Demographics

5. Win –Win relationship with the trade partners

6. Customer is the king

7. Even Billing –Road to ach supplier A

8. Be in touch with the market (70% Market, 30% Office).

9. Plan and Execute annual marketing Calendar-Time to market

10.Display share of 50% -to get 50% consumer share.

LG MUMBAI

LG Mumbai is the branch office of LGEIL. It is located in J.M Road.

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In 2004 LGEIL opened second factory which is located in Ranjangaon. This

plant manufactures all product including DVD writers and GSM mobiles. Thus

it became first company to manufacture DVD writer in India. The ODP plant

aims to reach a manpower base of 1500 people and an investment of Rs 300 Cr

till 2010.

LG India will become the export hub for LG Worldwide, catering to the Middle

East and African markets. The company aims to touch an export turnover of $3

billion by 2010 from India, which will contribute to 30 per cent of the Indian

arm's turnover.

Mumbai, India, October 6, 2004 -- LGE announced 3 growth strategies aimed at

the 1.1 billion people of India making the Indian market the second largest

global production base following China. Under this strategy LGE has projected

2007 revenues in India will exceed US$10 billion, 10 times that of 2004.

The three strategies for the Indian market that the global electronics giant

disclosed. included: penetrates the south-western market of India through the

new Mumbai plant near Mumbai, the second largest city in India, in addition to

the existing northern plant; installs a new GSM handset production line in the

new Mumbai plant and uses it as its second-largest global GSM handset

production line after the Qingdao plant in China; and expands the current 750

R&D staff in India to 1,500 by 2007, striving to develop premium products and

export 30% of India-manufactured products to Asia, Middle East and Africa

markets by 2007.

LG Electronics’ second new plant in Mumbai, India covers a total area of

211,200 square meters and is currently equipped with a production line to

manufacture 600,000 TVs and one million refrigerators a year. The company is

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set to add production lines of air conditioners, washing machines, monitors, and

electronic ovens, by 2005.

Also, LG Electronics is poised to install a GSM handset production line in the

new Mumbai plant by early next year. The Mumbai GSM handset line

envisages a capacity of manufacturing 2 million handsets annually, and the

company expands it to become a global GSM handset production base with a

capacity of an annual 10 million units by 2010.

In connection with its three growth strategies for the Indian market, LG

Electronics will invest a total of US$150 million in establishing facilities and

boosting R&D efforts in India by 2007. Specifically, it will invest US$53

million in the Mumbai second plant, another US$43 million in establishing the

GSM line, and US$54 million in securing R&D manpower and boosting other

efforts. Through these strategies, LG Electronics aims to penetrate the global

market by using China and India as its core production bases, while operating

its plants in Changwon and Gumi, Korea, as its main production bases. This

way, the company is pushing to penetrate the global home appliance market.

The present capacity of the facility is of 1 lakh unit per year and it shall cater to

the need of the domestic markets. LG plans to upscale its operations to a figure

of 2.5 lakh units a year in the near future. The Mumbai plant in addition to its

current manufacturing facility at Greater Noida will enable the company to

enhance its consumer reach and reiterate it’s commitment towards providing

superior technology products to the India consumer.

The key strategies being implemented include increasing the number of its

regional offices from six to eight. LG has split its southern regional office into

two, one comprising the states of Tamil Nadu and Kerala and the other

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consisting of Andhra Pradesh and Karnataka. In addition, it has split one of its

northern regional offices by making Uttar Pradesh a separate region after

spinning it out from Delhi NCR. The other four regional offices take care of

East, Gujarat and Madhya Pradesh, Maharashtra & Goa and Punjab, Haryana &

Rajasthan respectively.

In the coming year, LG is also repositioning its marketing spends, resulting in a

significant increase in its mass media expenditure for better brand visibility. LG

had a marketing budget of Rs 320 Cr in 2007 with a 60:40 split in favor of

below-the-line activities. Next year, the company plans to increase the share of

mass media even as overall marketing spends would be raised by just about 10-

15%.

LG Mumbai is the branch office of LGEIL. It is located in J.M Road.

The organization structure is –one branch manager, one chief accountant, and

area sales manager of CE, HA separate for GSM, Marketing manager for CE,

HA and separate for GSM. The Mumbai branch has warehouse at wagholi

Distribution and Marketing

The company has number of dealers and warehouses. They have

LG exclusive shopee. For the marketing of the

products a number of activities are followed

1. Exhibitions are conducted from time to time.

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2. Society and college activities are conducted.

3. Hoarding, Posters, banners are used so as to grab the attention of the

costumers.

4. Day to day advertisement in leading newspaper.

5. Discount at festival time.

6. For dealer relationship they arrange dealer meting at several time in the

year

7. LG divide dealer in gold silver etc. category to know the performance of

the dealers.

The logistics (Supply Chain Management)

Visit to warehouse of LG Mumbai at Thane

Logistics is the art and science of managing and controlling the flow of goods,

energy, information, and other resources like products, services, and people,

from the source of production to the marketplace. It is difficult to accomplish

any marketing or manufacturing without logistical support. It involves the

integration of information, transportation, inventory, warehousing, material

handling, and packaging. The operating responsibility of logistics is the

geographical repositioning of raw materials, work in process, and finished

inventories where required at the lowest cost possible.

Logistics Management is that part of the supply chain, which plans,

implements and controls the efficient, effective forward and reverse flow and

storage of goods, services and related information between the point of origin

and the point of consumption in order to meet customers' requirements.

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5R’s of Logistic followed by LG:

1. Right Time

2. Right Place

3. Right Condition

4. Right Cost

5. Right Handling

LG Mumbai Distribution

LG Mumbai comes under the western Distribution Region. This region has

following

1. Mumbai

2. Kolapur

3. Sholapur

4 Satara

5 Sangli

The LG Factory is located at NOIDA & MUMBAI. There are three types of

Warehouse-

1. Mother Warehouse

2. Branch Warehouse

3. Spare part warehouse

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The mother warehouse is that where the products from the factory are kept and

from that warehouse, the products are sent to the branch warehouse.

A warehouse is a commercial building for storage of goods. Warehouses are

used by manufacturers, importers, exporters, wholesalers, transport businesses,

customs, etc. They are usually large plain buildings in industrial areas of cities

and towns. They come equipped with loading docks to load and unload trucks;

or sometimes are loaded directly from railways, airports, or seaports. They also

often have cranes and forklifts for moving goods, which are usually placed on

ISO standard pallets loaded into pallet racks.

The Mumbai warehouse is located near Thane. It is 13670 sq. feet in area.

In warehouse 7 locations is set up for the products.

Loc 1, Loc 2, Loc 3, Loc 4, Loc 5, Loc6, Loc 7

Loc 1 – selling

Loc 2 - second sale

Loc 3 - insurance claim

Loc 4 - write off material

Loc 5 – destroy the item

Loc 6 - court case material

Loc 7 - for repair

5’s of warehouse, which the LG strictly follow.

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1. Sweeping

2. Sorting

3. Systematic Arrangement

4. Simplification

5. Self- discipline

In warehouse, the products are pinup with 3-color paper to get the knowledge

about the delivery.

1. Red Card – To stop the product going into market,

2. Green card – To allow the product for delivery in market,

3. Yellow Card – After the product labeled with green, allow this to move in

market

Distribution Time: -

• Local delivery – 4 hrs.

• Upcountry delivery - 12 hrs.

• Within 200 km. – 24 hrs.

• Beyond 200 km. – 48 hrs.

The above distribution time is the time of delivery of products from warehouse

to the market place, which the logistic department follows to fulfill the demand

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in the market at right time. In LG, we have the following process, which is

followed in logistic through ERP.

Order Processing

Invoicing

Indenting

Report

Order Processing booking for dealers /distributors

Invoicing after billing process/bill generation

Indenting requirement (Pdt Unit to branch unit)

Report distributed to all

In warehouse, there are two mode of dispersion of product from one place to

another within. a) Hydraulic b) Manual

In addition, there are 35 fire extinguishers to prevent the accidental hazard

within the warehouse due to fire. These fire extinguishers are valid up to year

2011. One has to follow the rule of “NO Smoking” within the warehouse

Logistics Ten Commandments – Golden Rules

1 - Warehouse 5S – to be strictly followed – FG – 2, 5 & 7 to be properly

maintained.

2 - 100% Bar-coding for all inward & outward transaction.

3 - Follow standard pick – ship process religiously.

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4 – No inventory mismatch, shortage or excess – monthly 100% physical

stocktaking.

5 – Nil 30+ for FG – 2, 3 & 5.

6 – Nil transit damage.

7 – File insurance claim within 2 days. Settle all claim all within 30 days.

8 – No inter – branch transfer without HO clearance.

9 – PSI feeding into system by 25th of every month. Ensure 90% accuracy.

10 – Apply physical FMFO.

Problem

1- In transit material damage checking.

2- Cost target achievement.

3- Natural events tracking.

Equipments

1- 100% Bar code scanner.

2- ERP – Invoice Generation Process.

3- Hydraulic Trolleys for material movement.

4- Pallets for safety of material.

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WAREHOUSE WITH THE EQUIPMENT.

WAREHOUSE: REFRIGERATOR AND CTV SECTION

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CUSTOMER SERVICE

The best and the biggest international brands are here in India –but the irony if

it all: where is the after-sales-service? So integral to a brand, so critical for its

success and so taken for granted in developed markets! In India, after sales

service is, for want of a better description, the pits. So what’s stopping the best

companies from pulling out all the stops when it comes to providing the best

service? Do customers expect for too much? Or is it that in India they don’t

really care. Brand Equity fanned out to MNC as well as Indian consumer

durable companies, stockiest and dealers, analysts and market researchers to get

a feel of what’s really keeping after sales from being used as a cutting edge

marketing tool in pushing products across categories.

Customers support following the purchase of a product or service. In some

cases, after-sales service can be almost as important as the initial purchase. The

manufacturer, retailer, or service provider determines what is included in any

warranty (or guarantee) package. This will include the duration of the warranty

traditionally one year from the date of purchase, but increasingly two or more

year’s maintenance and/or replacement policy, items included/excluded, labor

costs, and speed of response. In the case of a service provider, after-sales

service might include additional training or helpdesk availability. Of equal

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importance is the customer's perception of the degree of willingness with which

a supplier deals with a question or complaint, speed of response, and action

taken.

LG also had a big problem of after sale service in India. During my project I

also came to know that after sale service becomes the big issue in Mumbai

region. Customers as well as dealer were facing the problem of after sale

service. Because of this problem many dealer in Mumbai region were not ready

to sale LG product. So it becomes the big issue.

But LG has taken some solid steps towards improving customer’s perception

and experience of after sales service. Because it very important in competitive

market to provide the best service.

L G Electronics has signed a memorandum of understanding with 23 Industrial

Training Institutes to strengthen its after sales service in India.

The company aims to recruit 10,000 people by the end of this year as a part of

its branding strategy to focus on service and move away from discounting.

L G Electronics has identified eight states with high after sales service call rates

to ink the deals with the ITI. Y V Verma, director HR and management system,

LG Electronics said, "The Company was trying to find a solution for effective

after sales service since last two years. There is a huge need of trained

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manpower for the after sales service to align with the company's expansion and

focus on the GSM mobiles and the personal computer segments."

In the initial phase the company has entered into agreements with ITIs in

the states like Maharashtra, Gujarat, Delhi, Punjab, Assam, and

Karnataka and is in the last leg of signing with Uttar Pradesh.

1. L G Electronics, with 1200 service centers, has already recruited 300

students and plans to beef up the number to 10,000 by the year-end.

2. "The company has offered a scholarship to the selected students for the

last six months of their training programme,"

3. The company will invest Rs 8 Cr (Rs 80 million) in employee

development programme this year with an aim to attain a 8 per cent

attrition rate.

4. The company moved away from the discounting strategy since last year

and is putting thrust on the quality and service in its brand

communication to position LG as a premium consumer electronics brand.

5. At the top, the Service Division in Korea reports to the Global CMO. (as

mentioned in Dermot’s public interview in ET on Wednesday). This

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shows commitment that Service must be made into a marketing

differentiator, and leveraged thus.

6. LG has the widest service network across the country; some estimates put

it at a significant multiple of service-infrastructure from our nearest

competitor. While the sale size may also be a nice multiple from nearest,

it shows the company is ready to put our money where our mouth is.

7. The company has introduced a 211 service - once you register your

complaint, we will call you back in 2 hours (hence 2), set up an

appointment for the next convenient day for you (hence the first 1), and

show up in the promised 1-hour slot (hence the second 1). If the next

convenient day for you is the next day, that’s great too. It’s a disruptive

action in an industry (including LG) having traditionally shied away from

its service responsibilities, and thus not leveraging any mileage from it.

8. The company is promoting 211 through ATL, probably the first time

after-sales service is being communicated in this fashion by any product

company. You may have seen the TV commercial or heard the radio

advert or seen the newspaper ad or in-shop posters, both of which revolve

around prompt response.

9. The first LG-owned service centre opened in Gurgaon. (Service in India

generally works through authorized service centers, in LG’s case they

work exclusively for LG.) A company-owned service centre tries that

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much harder, knows things better, and can even contribute as a revenue

center.

CONSUMER SURVEY DURING EXHIBITION

From 16th to 25th May a consumer exhibition was organized at the college of

Engineering ground. The exhibition was sponsored by Sakal group in which

number of companies participated.

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EXHIBITIONS PICTURES SHOWING THE PRODUCTS

Research

Methodology

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Research methodology is considered as the nerve of the project. Without a

proper well-organized research plan, it is impossible to complete the project and

reach to any conclusion. The project was based on the survey plan. The main

objective of survey was to collect appropriate data, which work as a base for

drawing conclusion and getting result.

Therefore, research methodology is the way to systematically solve the

research problem. Research methodology not only talks of the methods but also

logic behind the methods used in the context of a research study and it explains

why a particular method has been used in the preference of the other methods

Research design:

Research design is important primarily because of the increased complexity in

the market as well as marketing approaches available to the researchers. In fact,

it is the key to the evolution of successful marketing strategies and

programmers. It is an important tool to study buyer’s behavior, consumption

pattern, brand loyalty, and focus market changes. A research design specifies

the methods and procedures for conducting a particular study. According to

Kerlinger, “Research Design is a plan, conceptual structure, and strategy of

investigation conceived as to obtain answers to research questions and to

control variance.

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Types of research are:

Descriptive Research

The type of research adopted for study is descriptive. Descriptive studies are

undertaken in many circumstances when the researches is interested to know the

characteristic of certain group such as age, sex, education level, occupation or

income. A descriptive study may be necessary in cases when a researcher is

interested in knowing the proportion of people in a given population who have

in particular manner, making projections of a certain thing, or determining the

relationship between two or more variables. The objective of such study is to

answer the “who, what, when, where and how” of the subject under

investigation. There is a general feeling that descriptive studies are factual and

very simple. This is not necessarily true. Descriptive study can be complex,

demanding a high degree of scientific skill on part of the researcher.

Descriptive studies are well structured. An exploratory study needs to be

flexible in its approach, but a descriptive study in contrast tends to be rigid and

its approach cannot be changed every now and then. It is therefore necessary,

the researcher give sufficient thought to framing research.

Questions and deciding the types of data to be collected and the procedure to

be used in this purpose. Descriptive studies can be divided into two broad

categories: Cross Sectional and Longitudinal Sectional. A cross sectional study

is concerned with a sample of elements from a given population. Thus, it may

deal with household, dealers, retail stores, or other entities. Data on a number of

characteristics from sample elements are collected and analyzed. Cross sectional

studies are of two types: Field study and Survey. Although the distinction

between them is not clear- cut , there are some practical differences, which need

different techniques and skills. Field studies are ex-post-factor scientific

inquiries that aim at finding the relations and interrelations among variables in a

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real setting. Such studies are done in live situations like communities, schools,

factories, and organizations.

Another type of cross sectional study is survey result, which has been taken by

me. A major strength of survey research is its wide scope. Detail information

can be obtained from a sample of large population .Besides; it is economical as

more information can be collected per unit of cost. In addition, it is obvious that

a sample survey needs less time than a census inquiry. Descriptive research

includes survey and fact finding enquiries of different kinds of the major

purpose. Descriptive research is description of the state of affairs, as it exists at

present. The main characteristic of this method is that the researcher has no

control over the variables; he can only report what has happened or what is

happening. The methods of research utilized in descriptive research are survey

methods of all kinds including comparative and co relational methods. The

reason for using such needs to be flexile in its approach, but a descriptive study

in contrast tends to be rigid and its approach cannot be changed ever now and

then.

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MUMBAI BRANCH

MUMBAI 1 MUMBAI 2 MUMBAI 3

DEALER MANAGEMENT

Mapping of Mumbai region dealers.

In Mumbai region there were total 180 dealers including the up country side

They have been divided into three categories on the basis of their turnover and

the selling capacity.

MUMBAI -1

MUMBAI-2

MUMBAI-3

MUMBAI-1 Includes the modern trade and they have direct billing from the

branch office. They have high turnover and the company depends heavily on

them

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MUMBAI-2 includes the distributors. They have direct billing from the branch

office.Their turnover is also high.

MUMBAI-3 Includes the sub dealers .They have direct billing from distributors

or from the branch office. Their turnover is not so high, but there are few sub

dealers whose potential is quite high. According to sales the branch has

designated as gold and silver sub dealers.

OBJECTIVE OF THE STUDY

The objective was to find out the market share of LG products, advantages,

and disadvantages of LG products from dealers and to find out what

problems they are facing with the LG products so that problems can be

resolved to increase the sale.

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PICTURE SHOWING THE PRODUCT OF LG IN ONE OF THE SHOP

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Data collection methods:

After the research problem, we have to identify and select which type of data is

to research. At this stage; we have to organize a field survey to collect the data.

One of the important tools for conducting market research is the availability of

necessary and useful data.

Primary data : For primary data collection, we have to plan the following

four important aspects.

Sampling

Research Instrument

Secondary Data - The Company’s profile, journals and various literature

studies are important sources of secondary data.

Data analysis and interpretation

1. Questionnaires

2. Pie chart and Bar chart

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Questionnaires:

This is the most popular tool for the data collection. A questionnaire contains

question that the researcher wishes to ask his respondents which is always

guided by the objective of the survey.

Pie chart:

This is very useful diagram to represent data , which are divided into a number

of categories. This diagram consists of a circle of divided into a number of

sectors, which are proportional to the values they represent. The total value is

represented by the full create. The diagram bar chart can make comparison

among the various components or between a part and a whole of data.

Bar chart:

This is another way of representing data graphically. As the name implies, it

consist of a number of whispered bar, which originate from a common base line

and are equal widths. The lengths of the bards are proportional to the value they

represent.

Preparation of report:

The report was based on the analysis and presented with the findings and

suggestions. The sample of the questionnaires is attached with the report itself.

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Sampling Methodology:

Details of the sampling methodology, I have made questionnaire. The one is

made for the Customer.

No. of questions in questionnaires for customer: 07

No. of question related to LG product: 03

No. of people met during the research: 200

No. of respondents during the research: 50

Sample unit

Professionals, Business man,

Employees, House wife,

Working women, Students

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DATA ANALYSIS

&

INTERPRETATION

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Q1. Have you purchased any consumer durable during Exhibitions?

Yes

No

INTERPRETATION

1. 65 % of Customer have not purchased any consumer durable from

exhibitions.

2. Only 35 % people have purchased.

3. It shows that consumers are coming in the exhibition for knowledge of

product and also they want to know that weather there is actual price

difference in exhibition and shop or not.

4. Consumer also want to compare to the different brand which are available

in the exhibition.

5. So exhibitions are more useful to increases brand awareness.

6. People are less interested to purchase product from the exhibition.

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Q.2While purchasing consumer durable which parameter influences you?

Price

Product feature

Brand

Service

Durability

INTERPRETATION

1. 30% of customer gives importance to price. So it shows that Indian

consumers are very price sensitive. They give more importance to price

over the brand.

2. 26% give importance to brand. So price and Brand matter a lots for the

costumers. And they are also want best brand in best price.

3. 19% to product feature Service 16% and durability 9% Service is also a

big factor for the customer they are less interested in the durability.

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Q3. From where you prefer buying consumer durables

Exhibitions

Co.shoppee

Showroom

INTERPRETATION:

1. A majority of customers prefer to buy from showrooms. Very less

proposition of customers buys from Exhibitions.

2. 47% customers are prefer to by from the showrooms because the

showrooms are more convenient to customers they also think that these

shops give more discounts.

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INTERPRETATION

In CTV section maximum customers have Onida, in LCD Sony is the leader, In plasma BPL is the leader, In Ref LG is the leader, MW LG is the leader. In WM there are companies and in AC also.

Q.6. How frequently you change your consumer durables?

1-3 years

3-5 years

5-10 years

More than 10 years

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INTERPRETATION

1. Customers prefer to change consumer durables within 5-10 years. In

India people do not change consumer durable frequently.

2. 23% customers do not change their consumer durable within 10 year.

3. It represent that Indian consumer do not prefer to change their consumer

durable frequently.

Q.7.Do you prefer any financing scheme to purchase consumer durables?

Yes

No

INTERPRETATION

Majority of customers do not prefer any financial scheme.

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Dealer survey Findings

1. By calculating the display share we found that in most of store LG has

50% display share almost all categories.

2. By the actual monthly sale of particular store we came to know the

capacity of the store and how much product can they sale.

3. It helps us to know that weather dealer is capable of being a direct dealer

of LG or not and it also helps to find out the new dealer who are capable

of being the dealer of LG.

4. We also came to know while visiting the shops that there was big

problem of after sale service.

5. Many dealers were facing the problem of after sale service because there

is no follow up calls from LG.

6. Demo calls also not done properly.

7. The top competitor of LG product in Mumbai is SAMSUNG.

8. In Mumbai area the performance of LG is in better position but the

competitor also hold closer margin.

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9. There is high growth of sale in market due to booming in new technology

and better service.

10.Word of mouth plays a vital role in awareness among customer. This is

one factor, which can play a good role in promotion of products as well

as demonstration given by the shopkeeper also plays a vital role for

customer.

RECOMMENDATIONS AND SUGGESTIONS

1. on. A big LG showroom should have at least 2 such kind of person.

2. LG should try new dealer who have the potential. So they can target more

market.

3. As there is a bottle neck competition between Samsung and LG, it is

necessary to take measure steps to overcome the area of downfall in LG

with respect to Samsung.

4. The marketing managers should make better relations with dealers and

reputation of the company.

5. Customer considers quality as their first preference, so the company

should give more stress on this.

6. The switching of customer from LG product to other brand is due to the

bed after sell service in shop.

7. The product is well aware and it is on top of mind of customer. So

company should always improve services and update their technology.

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CUSTOMER SURVEY FINDINGS

Conclusion

India being the second largest growing economy with huge consumer class has

resulted in consumer durables as the fastest growing industries in India LG,

SAMSUNG the two Korean companies has been maintaining the lead in the

industries with LG being leader in almost all the categories.

The rural market is growing faster than the urban market, although the

penetration level is much lower .The CTV segment is expected to the largest

contributing segment to the overall growth the industry. The rising income

levels double-income families and consumer awareness are the main growth

drivers of the industries.

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