Blair Water Purifiers India
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. ABSTRACT
Blair Company Inc. was founded by Eugene Blair in 1975. The company’s mission is to provide equipment that will meet the needs of its target market in terms of filtration and purification of water for having high quality water. As part of the organisational goal, the company is also aiming to enter international market to be able to be known in both local and international level and position itself in the global competition. As part of the geographic expansion of the company, they are trying to produce innovative products to meet future needs in terms of water purification and filtration. Rahul Chatterjee, one of the companys international market liaisons, had made two fact-finding trips to India to survey the Indian market and competition for home water filters and purifiers, and the foreign investment issues in India. Based on these findings, he had to evaluate the feasibility of launching the Companys own “Delight” home purifier in the Indian market. After several researches and analysis made on the data obtained, he provided his recommendations on the appropriate entry strategy for the Indian market.
2. PROBLEM STATEMENT
The Indian market is large and expected to grow over three-fold in the coming five years. Nearly 85% of population is not being reached by any competitor. Very low labor costs and central location could enable export to other lesser-developed countries. Indian customers are favorable toward Western products, and also Indian government is actively seeking foreign investors. Quality of Blair’s product appears superior to competitors’ Indian introduction will be consistent with firm’s objectives required investment is low.
From the analysis made by Chatterjee and the Indian research agencies, is easy to identify the main problem in the high level of competition. In fact the main Indian competitors, Eureka Forbes, Ion Exchange, Singer, had obtained a good position on the market.
The first one with its water purifiers Aquaguard has gained huge brand equity, so that customers mistakenly used it to refer to other water purifiers or to the entire product category.
Ion exchange had been identified as a possible major player on the market, because of the results obtained without great efforts in advertising and promotion during the 3 years of activity on the market.
The last competitor, was already being sold in Bombay and Delhi but not in Calcutta; by the way a project of expanding the market was already prepared and the 210 company-owned showrooms (located in the main urban areas around the country), provided several demonstration of Aquarius purifiers, and it was a well-known and respected brand name in India.
Our goal would be though, to identify the best way to enter the market through branding and positioning, in order to avoid the high level of competition.
3. ALTERNATIVE COURSE OF ACTIONS
In order to reach our goal we have identified three different alternatives:
Licensee Consideration: Entering the market as a joint working arrangement with a license, the company would have minimal financial costs and the revenue would come more easily and quickly; on the other side there would be a limited control over product quality and marketing mix activities and there would be the possibility of never really Know the Indian market
Joint Ventures Consideration: In this way financial investments and annual fixed costs would be much higher and strongly dependant on the scope of the operations. On the other side there would be the share of the profits
Acquisition Consideration: Investment may be much lower than in a Join Venture but the profits would not be shared and it would be possible to control all the company operations. Also if the risk of be seen by the customers as foreigners should persist
STRENGHTS & WEAKNESSES OF CHOSEN RECOMMENDATION
In order to better understand, the reason why we chose this possible alternative to the problem, we made a balance of strengths and weaknesses.
The results of our analysis are shown in the table below.
STRENGHTS
WEAKNESSES
Increased control over all marketing alternatives
Profits are shared
Take advantage of Indian Partner’s expertise
Potential for disagreement on decisions relating to investments, technology-transfer, access to dealers, R&D, etc
Sharing of the risks
The company may experience problems with establishing work, rules, policies and strategies
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