A REPORT ON LUBRICANTS DISTRIBUTION - A CASE STUDY OF MOBIL

Introduction

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A REPORT ON LUBRICANTS DISTRIBUTION - A CASE STUDY OF MOBIL

Mobil
Mobil is a major American oil company which merged with Exxon in 1999 to form ExxonMobil. Today Mobil continues as a major brand name within the combined company. Its former headquarters in Fairfax County, Virginia, are currently used as ExxonMobil's downstream headquarters. William P. Tavoulareas was President of Mobil Corporation until succeeded by Allen E. Murray in 1984. When Exxon Corporation merged with Mobil Corporation in 1999, the newlymerged company ended enrollment in Mobil Corporation's domestic partner benefits for same-sex partners of employees, and it rescinded formal prohibitions against discrimination based on sexual orientation by removing it from the company's Equal Employment Opportunity policy.

Rotex Petrochem
Rotex Petrochem Pvt Ltd. founded in the year 1966 by Mr. T. K. Rao, a Chemical Engineer by training, is a reputed name in Automotive Lubricants with a customer base of 1000+ Customers in the State of Andhra Pradesh. Rotex Petrochem Pvt. Ltd. is an authorized distributor for Exxon and Mobil branded Lubricants and snap on tools. Rotex have the state of the art infrastructure and trained personnel to meet the requirements of our customers. As a 40 year old successful business Rotex take pride in • Ensuring high service levels above par with the industry standards • Our focus on adding value to the customer’s business • Being Proactive in terms of upgrading the infrastructure to meet the ever changing needs of the customers • Being an integral part of the customers business Currently Rotex cater to all the Car Dealerships in the state of Andhra Pradesh and retail dealers in and around Hyderabad and Visakhapatnam. The main objective if the study is

To analyze the distribution channel adopted by the organization

• To map the existing distribution system adopted by Mobil to distribute their products • To identify potential gaps and improve their distribution efficiency
2| Page Aurora’s Business School, Hyderabad

A REPORT ON LUBRICANTS DISTRIBUTION - A CASE STUDY OF MOBIL

Methodology: In research methodologies I’m using two types of research methodologies. • Primary Methodology • Secondary Methodology Primary Methodology By designing a questionnaire to find the usage, lead time, stock in, stock out details of every outlet the company is supplying products to analyze the distribution channel and to find the performance level. Secondary Methodology By collecting the past data from the organization and data regarding the other competitors from internet in order to find the distribution channel followed by other competitors.

3| Page Aurora’s Business School, Hyderabad

A REPORT ON LUBRICANTS DISTRIBUTION - A CASE STUDY OF MOBIL

Background of the Study

Marketing involves satisfying consumer’s needs and wants. The task of any business is to deliver customer value at a profit. The American Marketing
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and renew customer value. THE ROLE OF MARKETING CHANNELS Successful value creation needs successful value delivery. • Assume risks connected with carrying out channel work.A CASE STUDY OF MOBIL Association offers the following formal definition: Marketing is an organizational function and a set of processes for creating. and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stake holders. and capturing customer lifetime value. experience. building customer loyalty. and other actors and forces in the marketing environment. and speed. and collaborators) and value-based activities (value exploration. Holistic marketers are increasingly taking a value network view of their businesses. intermediaries usually offer the firm more than it can achieve on its own. These are the various roles performed by the channel partners: • Gather information about potential and current customers. • Acquire the funds to finance inventories at different levels in the marketing channel. communicating. competitors. Intermediaries normally achieve superior efficiency in making goods widely available and accessible to target markets.A REPORT ON LUBRICANTS DISTRIBUTION . • Reach agreements on price and other terms so that transfer of ownership or possession can be affected. and value delivery) helps to create. According to this view. • Provide for buyers' payment of their bills through banks and other financial institutions. Hyderabad . Holistic marketers achieve profitable growth by expanding customer share. A holistic marketing framework shows how the interaction between relevant actors (Customers. The marketing channel performs the work of moving goods from producers to consumers. value creation. • Develop and disseminate persuasive communications to stimulate purchasing. holistic marketers succeed by managing a superior value chain that delivers a high level of product quality. • Provide for the successive storage and movement of physical products. and scale of operation. • Oversee actual transfer of ownership from one organization or person to another. company. maintain. • Place orders with manufacturers. Through their contacts. 5| Page Aurora’s Business School. service. specialization.

To customers. and service reputation. growth and profit record. future growth potential. producers should evaluate the number and character of other lines carried and the size and quality of the sales force. It needs to determine intermediaries' needs and construct a channel positioning such that its channel offering is tailored to provide superior value to these intermediaries. Coercive and reward power are objectively observable. but the intermediary must add a charge to cover its work. other lines carried. If the intermediaries are sales agents. If the intermediaries are department stores that want exclusive distribution. They should evaluate the number of years in business.  Motivating channel members A company needs to view its intermediaries in the same way it views its end users. the producer should evaluate locations. motivated. legitimate. If the intermediaries are more efficient than the manufacturer.  Selecting channel members Companies need to select their channel members carefully. cooperativeness.A REPORT ON LUBRICANTS DISTRIBUTION . they can often be performed better through specialization.  Training channel members Companies need to plan and implement careful training programs for their intermediaries. inefficient. CHANNEL MANAGEMENT DECISIONS After a company has chosen a channel alternative. the channels are the company. individual intermediaries must be selected. Being able to stimulate channel members to top performance starts 6| Page Aurora’s Business School. they should enjoy even lower prices. Hyderabad . Consider the negative impression customers would get off if one or more of their outlets or dealers consistently appeared dirty. and evaluated. trained. financial strength. When the manufacturer shifts some functions to intermediaries. the producer's costs and prices are lower. expert. and type of clientele. producers should determine what characteristics distinguish the better intermediaries. The company must constantly communicate its view that the intermediaries are partners in a joint effort to satisfy end users of the product. and they can be shifted among channel members. Channel arrangements must be modified over time. To facilitate channel member selection. prices to consumers should be lower. or unpleasant. If consumers perform some functions themselves. and referent power are more subjective and dependent on the ability and willingness of parties to recognize them.A CASE STUDY OF MOBIL All channel functions have three things in common: They use up scarce resources.

market research programs. which makes mass marketing more difficult. new competition arises. many critics point to the increasing splintering of the market. A producer will occasionally discover that it is paying too much to particular intermediaries for what they are actually doing. consumer buying patterns change. niches. Marketers are increasingly combining several 7| Page Aurora’s Business School. and individuals. mass distribution.  Evaluating channel members Producers must periodically evaluate intermediaries' performance against such standards as sales-quota attainment. which leads to the lowest costs. ➢ Target marketing Once the firm has identified its market-segment opportunities. average inventory levels. Most companies are turning to micromarketing at one of four levels: segments. the market expands. A company cannot connect with all customers in large. motivated. In mass marketing. broad.markets. Underperformers need to be counseled. or diverse . and cooperation in promotional and training programs. Consumers vary on many dimensions and often can be grouped according to one or more characteristics. treatment of damaged and lost goods. innovative distribution channels emerge. customer delivery time. and the product moves into later stages in the product life cycle. or terminated.A CASE STUDY OF MOBIL with understanding their needs and wants. Producers should set up functional discounts in which they pay specified amounts for the trade channel's performance of each agreed-upon service. local areas. The proliferation of advertising media and distribution channels is making it difficult and increasingly expensive to reach a mass audience. The company should provide training programs.  Modifying channel arrangements A producer must periodically review and modify its channel arrangements. Some claim that mass marketing is dying. ➢ Segmentation marketing The starting point for discussing segmentation is mass marketing. it has to decide how many and which ones to target. Modification becomes necessary when the distribution channel is not working as planned. LEVELS OF MARKETING SEGMENTATIONS AND TARGETS Markets are not homogeneous. and other capability-building programs to improve intermediaries’ performance.A REPORT ON LUBRICANTS DISTRIBUTION . retrained. and mass promotion of one product for all buyers. The argument for mass marketing is that it creates the largest potential market. Hyderabad . the seller engages in the mass production. which in turn can lead to lower prices or higher margins. However.

The dominant firm's costs might rise excessively and hurt its profits. ➢ Expanding the total market The dominant firm normally gains the most when the total market expands. ➢ Expanding market share Market leaders can improve their profitability by increasing their market share. ✔ Select one or more market segments to enter (market targeting). those who have never used it (new-market segment strategy) or those who live elsewhere (geographicalexpansion strategy). Second. It keeps increasing its competitive strength and value to customers. Every product class has the potential of attracting buyers who are unaware of the product or who are resisting it because of price or lack of certain features.A CASE STUDY OF MOBIL variables in an effort to identify smaller. does not automatically 8| Page Aurora’s Business School. even if market size remains constant. the firm can try to increase its market share. establish and communicate the distinctive benefits) of the company's market offering (market positioning). Gaining increased share in the served market. the dominant firm must continuously defend its current business. A company can search for new users among three groups: those who might use it but do not (market-penetration strategy). COMPETITIVE STRATEGIES FOR MARKET LEADERS The leader might spend conservatively whereas a challenger spends liberally. Leaders can respond to an aggressive competitor in three ways first. Effective target marketing requires that marketers: ✔ Identify and profile distinct groups of buyers who differ in their needs and preferences (market segmentation). The leader leads the industry in developing new product and customer services. The leader might misjudge its competition and find itself left behind. or a discount competitor can undercut prices. however. better-defined target groups. Hyderabad . the firm must find ways to expand total market demand. distribution effectiveness. the firm must protect its current market share through good defensive and offensive actions. The market leader should look for new customers or more usage from existing customers. ✔ For each target segment. Third. The dominant firm might look old-fashioned against new and peppier rivals.A REPORT ON LUBRICANTS DISTRIBUTION . and cost cutting. Usage can be increased by increasing the level or quantity of consumption or increasing the frequency of consumption. ➢ Defining market share While trying to expand total market size.

and to meet the customer’s service requirements. the effect of increased market share on actual and perceived quality. break and sort them into smaller lots and mixed lots and reroute inventory. to do it cheaply. and then moved directly to a railroad factor. that is. They are not 9| Page Aurora’s Business School. TRANSPORTATION To fulfill the order in a marketing channel is to obtain the items prepare them to ship. Distribution centers are meant to hold inventory only for the short time necessary to send it somewhere else. Because the cost of buying higher market share may far exceed its revenue value. Competition and deregulation has obliged the readjustment of attitudes and methods. Increasingly they are making a distinction between a warehouse and a distribution center. otherwise known as picking and packing. This is one reason why many pundits think catalog marketers will adapt to internet better than mass-merchants. Much depends on the company's strategy. sized to seat the container securely. a fulfillment house. Transportation. a company should consider four factors before pursuing increased market share: The possibility of provoking antitrust action. Economic cost. an increased interest in contract warehousing. such as a rail car. The list of coordinating mechanisms available in many economies is long. For example some maritime shippers use containers that can be affixed directly to a truck bed by a crane. Hyderabad . By abandoning their own warehouse whose configuration. Postal carriers routinely connect with private truck depots. of course is a complex and expensive endeavor. It is closely linked to the location and operation of some number of warehouses. and number they may have come to regret. They are central points to accumulate large lots. In a simpler time. It is difficult to do this humble task without errors. who specialize in shipping large lots to a few locations. a ship. a truck. shippers create great transportation flexibility. Hence. This determines the routing possibilities and is therefore a critical decision. emplacement. Warehouses are intended to hold inventory for some time. Transportation is not just the routing of shipments. that is. Catalogue companies master the art of shipping small lots directly to the individuals or quite often they contract with an organization that has mastered the art. Airfreight operators freely cooperate with truckers. shippers often thought in terms of a single type of carrier. outsourcing the warehouse function. pursuing the wrong marketing-mix strategy. Carriers encouraged this single mode mentality often creating barriers to mixing shipping modalities. Mixing modalities is common in many economies and the carriers themselves make it even easier.A CASE STUDY OF MOBIL produce higher profits—especially for labor-intensive service companies that may not experience many economies of scale.A REPORT ON LUBRICANTS DISTRIBUTION . or a plane.

for example. and from there transferred to trucks that transport gasoline to retailers 10 | P a g e Aurora’s Business School. a striking phenomenon has been the explosive growth of third party logistics providers (3PL). In cross-docking. For example. never entering a warehouse. Ex: FedEx and UPS. As such. On paper. Third party logistics providers There is a general theme in business press: Logistics is more and more being reconsidered. In reality. BASIC MEANS OF TRANSPORTATION There are five basic means of transporting products utilized by manufacturers and distributors: air. In this vein. The interrelationship of these decisions means that successful planning and scheduling can help business owners to save on transportation costs. distribution centers are like central dispatches.A CASE STUDY OF MOBIL intended to hold large lots for long periods. it represents an effort by FedEx to expand its in-house ability to offer service to various locations and industry sectors. The ultimate in dispatching quickly is a fairly new system called Crossdocking. It goes to the distribution center where it is merely loaded with a variety of other orders on to a truck bound for the store. rebundled and outsourced – not just to a single party. this looks like duplication of service. motor carrier. train. otherwise known as contract logistics providers. In an interesting twist some 3PL firms are also forming working partnerships with freight forwarders and air carriers. the accessibility of suitable means of transportation factors into decisions regarding where best to locate a business or facility. For example. The decisions a business owner must make regarding transportation of products are closely related to a number of other distribution issues. Many distribution networks consist of a combination of these means of transportation. Although transportation costs may be reduced by sending larger shipments less frequently. The merchandise crosses the asphalt from one loading dock to another. between freight forwarders and companies that actually do the transportation. or pipeline. marine. Many alliances also exist. the store’s assortment is composed at the factory or at a holding warehouse and labeled for the store. it is also necessary to consider the costs of holding extra inventory. Hyderabad . The means of transportation chosen will also affect decisions regarding the form of packing used for products and the size or frequency of shipments made. The key to cross-docking is that the end-users’s site places an order for an assortment of items. Generally the order would be composed from pallets of merchandise at the distribution center. and then sent to the store.A REPORT ON LUBRICANTS DISTRIBUTION . oil may be pumped through a pipeline to a waiting ship for transport to a refinery.

much of it due to local shipments. motor carriers account for approximately $120 billion in annual revenue. since a plane cannot ordinarily be pulled up to a loading dock. Air transport: Air transportation offers the advantage of speed and can be used for long-distance transport. But access to the network remains a problem for many businesses. Another disadvantage associated with air transportation is its lack of accessibility. motor carriers are now free to operate wherever they wish and to charge any rates that are agreeable to the shipper and the carrier. trucks are the dominant means of shipping in the United States. All of these transportation choices contain advantages and drawbacks. Motor carriers: Accessible and ideally suited for transporting goods over short distances.A REPORT ON LUBRICANTS DISTRIBUTION .A CASE STUDY OF MOBIL or heating oil to consumers. Railways: Rail transportation is typically used for long-distance shipping. it offers about the same delivery speed as trucks over long distances and exceeds transport speeds via marine waterways. The main advantage of water transportation is that it can move products all over the world. air is also the most expensive means of transportation. It is generally used to transport heavy products over long distances when speed is not an issue. 11 | P a g e Aurora’s Business School. deregulation and the introduction of freight cars with larger carrying capacities has enabled rail carriers to make inroads in several areas previously dominated by motor carriers. it is necessary to bring products to and from the airport by truck. Less expensive than air transportation. However." wrote Hoch. In fact. In fact. This industry sector underwent tremendous change in the 1990s with the introduction of deregulation measures that removed most state and federal regulations in the areas of pricing and operating authority. "With few exceptions. However. so it is generally used only for smaller items of relatively high value—such as electronic equipment—and items for which the speed of arrival is important—such as perishable goods. industry observers note that port terminal accessibility to land-based modes of transportations is lacking in many regions. Although accessibility is a problem with ships—because they are necessarily limited to coastal area or major inland waterways—piggybacking is possible using either trucks or rail cars. Water transport: Water transportation is the least expensive and slowest mode of freight transport. although he noted that trucks are still subject to federal laws on vehicle specifications and the parameters of the sanctioned truck routes of the Surface Transportation Assistance Act of 1982. Hyderabad .

slurry coal.000 miles of transmission pipe and more than 919.) of other companies. According to Transportation and Distribution. they can also be used to deliver certain products (chemicals. etc.A CASE STUDY OF MOBIL Pipeline facilities: Most pipeline transportation systems are privately owned. which combine to deliver nearly 20 trillion cubic feet of gas on an annual basis. 12 | P a g e Aurora’s Business School.A REPORT ON LUBRICANTS DISTRIBUTION . the nation's natural gas line networks include 276. Hyderabad .000 miles of distribution lines. Generally used for transport of petroleum products.

Hyderabad . high levels of investment in the power. according to a new study from the research and advisory firm. In the automotive sector.A REPORT ON LUBRICANTS DISTRIBUTION . Whilst there are no restrictions on foreign lubricant manufacturers from establishing 100%-owned operations in India. Worldwide established brands. Each one of the vast contingent of 22 Multinationals and a total of 80 big & small players are vying for a pie of Rs. marine and aviation lubricants. many have chosen to partner with local companies. consumers are migrating to better quality vehicles and motorbikes and as a result. power and engineering sectors is creating new market opportunities for lubricants’ manufacturers. some of them 13 | P a g e Aurora’s Business School. THE BACKGROUND These are exciting times for the lube industry in India. In the industrials’ segment. this is benefiting multi-grade lubricant products with strong brand recognition and wide distribution.5.A CASE STUDY OF MOBIL Industry Profile LUBRICANT INDUSTRY Strong growth in the Indian automotive. using higher grade lubricants. India Analysis. 500 Crore market. manufacturing and transport sectors should drive very strong growth for transformer oils.

and risk management are going to be the crucial factors. Prior to 1992 the lube industry in India was controlled by the 4 major Public Sector Oil companies namely Indian Oil. the Indian lube industry with annual demand of 1 million tons is just behind Japan and China in Asia having a demand growth rate of 4% compared to the World growth rate ranging between zero to 2%. logistics management.5 million tons. Pennzoil are fighting it out with established Indian brands like SERVO & others to establish their foothold in the 6th largest lubricant market in the World. Most of the new entrants formed associations with Indian companies both in the Private & Public sectors. Gulf. HPC. Hyderabad . All these new entrants are targeting for a very small share of the market considering that even 1% market share means a sale of Rs 55 crores. The 14 | P a g e Aurora’s Business School. like Shell. Retail networks. as they do not have the distribution infrastructure to sell their products in a deregulated market. Compared to the average World consumption of 35 Million tons per annum & Asia-Pacific region consumption of 7. Elf. Competitive Analysis Recent deregulations in the lubricant market have promised many new opportunities for the private lube manufacturers. With the dismantling of Administered Price Mechanism (APM) the burden of subsidies is now being passed on to the government. That is the lube industry in India today. The stand-alone refineries will have to be merged with the marketing companies. The Indian Oil controlled 54% of the lube market out of total PSU's market share of more than 90% during 91-92. Caltex.A REPORT ON LUBRICANTS DISTRIBUTION . Tidewater & others.A CASE STUDY OF MOBIL albeit new to India. During these phases marketing channels of distribution had drifted from petrol stations to bazaar trade. Companies like Reliance are already selling their products through petrol pumps. This has been followed by sudden entry of lot many players. The Government policy of deregulation followed by entry of multinationals through JVCs had its effect on the market dominance of PSUs. Mobil.BPC & IBP and a handful of private companies like Castrol. Private participants will also gain a presence in the Indian oil and gas sector and hence there will be competition between participants that will ensure the growth of the sector. The decanalisation of the lube base oil imports in 1993 by the Govt. each one claiming to have some international collaboration and a `foreign' brand name. the PSU Oil Companies controlled 90% of the market share. This had its initial impact and illusions in the market and the market became more volatile. the industry is going to witness sea changes. With the distribution & canalization of base oil import being controlled by the Government of India. of India followed by reduction of import duty on lube base oils from 85% to 30% and gradual scrapping of administered pricing observed the announcement of almost a new lube venture every month during 1994. In the next couple of years.

Convenient stores and highway stops for vehicles are being built from where the vehicle owners can get their vehicles repaired and get their supply of lubricants. In this. Most of the MNC’s have tied up with oil majors for marketing their lubricants like Castrol with Escorts and Tata BP with Telco. Elf. Frost & Sullivan expects private sector companies to have a market share of around 25 percent. After the deregulation of the petrol pumps companies are keenly watching the developments in the lubes market." These are outlets meant only for lubricant sales. Castrol is next with 25 percent of the share and HPCL and BPCL are next with about 20 percent and 15 percent shares respectively. Almost 70 percent of the lubricants in India are sold through petrol pumps. Lubes manufactured by Reliance Petroleum. Indian Oil Corporation Limited is leading the market with 30 percent market share. MNC’s and private companies sell through retail stores. Other private companies hold the remaining market share. The distribution channel adopted by public sector units is through the petrol pumps. linkages are gaining importance. Hyderabad . the consumer selects his own brand of lube after giving his vehicle for service in the same outlet. To compete with dominant public sector distribution. The concept of "User Outlet" is another new concept developed by Castrol.A REPORT ON LUBRICANTS DISTRIBUTION . concepts like "Bazaars" and "Super Stores" have also been developed. The original equipment market contributes almost 70 percent and 30 percent of the market is comprised by the retail sales segment. Key Success Factors Frost and Sullivan believe that the key factors for success in this highly fragmented and competitive industry include: Brand Image Distribution Channels 15 | P a g e Aurora’s Business School. Gulf Oil etc.A CASE STUDY OF MOBIL monopoly of the public sector holdings will no longer exist. Castrol. MNC’s will be able to sell their products through petrol pumps. Castrol developed the concept of "Bazaars. Distribution Structure There are two key markets for lubricants in India. stockiest and retailers throughout India. which are now sold at petrol pumps. The channel for replacement market or the retail segment is petrol pumps or retail stores. Given high levels of competition original equipment. In the lube market. In medium to long term. Other private participants have had to set up an independent infrastructure comprising of distributors.

in the future volume growth will be affected because of use of better quality. the scenario has improved with higher sales of commercial vehicles and two-wheelers. which has the potential to change the face of the lubricant industry. In the shorter term. However. Given the rising competition. success of a product would largely depend how well it is branded and distributed. Company Profile 16 | P a g e Aurora’s Business School.A CASE STUDY OF MOBIL Margins and Discount Schemes Prices and Promotion Market Trend In the future. long drain lubes. growth in the automotive lubricants industry will largely depend on the overall performance of the economy. This will increase the replacement cycle for lubes.A REPORT ON LUBRICANTS DISTRIBUTION . one will witness intense competition in a slow growing market marked by a consolidation activity. In the past one and a half years. Hyderabad .

Texas. When ranked by oil and gas reserves it is 14th in the world with less than 1% of the total. Exxon Mobil's reserves were 72 billion oil-equivalent barrels at the end of 2007 and. ExxonMobil is the largest of the six oil super majors with daily production of 3.A CASE STUDY OF MOBIL EXXON Mobil The Exxon Mobil Corporation. Rockefeller's Standard Oil company. accounting for approximately 70% of revenue. a petroleum shipping company. Mobil. and was formed on November 30. and SeaRiver Maritime.A REPORT ON LUBRICANTS DISTRIBUTION . The company employs over 82.3 million barrels.6% ownership) in Canada. with 17 | P a g e Aurora’s Business School. 1999. which is less than several of the largest state-owned petroleum companies. The upstream division dominates the company's cash flow. It is a direct descendant of John D. It also owns hundreds of smaller subsidiaries such as Imperial Oil Limited (69. by the merger of Exxon and Mobil. having been ranked either 1 or 2 for the past 5 years. this was approximately 3% of world production. or ExxonMobil. Hyderabad . The company has 38 oil refineries in 21 countries constituting a combined daily refining capacity of 6. at then (2007) rates of production are expected to last over 14 years. Its headquarters is located in Irving. is an American multinational oil and gas corporation. as indicated in ExxonMobil's 2006 Corporate Citizen Report. ExxonMobil is one of the largest publicly traded companies in the world.000 people worldwide.921 million BOE (barrels of oil equivalent). ExxonMobil markets products around the world under the brands of Exxon. In 2008. and Esso.

000 employees in its Fairfax downstream headquarters and 27. In 2005. ExxonMobil had committed less than 1% of their profits towards researching alternative energy. less than other leading oil companies. The ranking is based on the quantity (15. Revenue and profits 18 | P a g e Aurora’s Business School.A CASE STUDY OF MOBIL approximately 4.5 million pounds in 2005) and toxicity of the emissions. Operating divisions by category are as follows: • Upstream ○ ExxonMobil Exploration Company ○ ExxonMobil Development Company ○ ExxonMobil Production Company ○ ExxonMobil Gas and Power Marketing Company ○ ExxonMobil Upstream Research Company • Downstream ○ ExxonMobil Refining and Supply Company SeaRiver Maritime ○ ExxonMobil Fuels Marketing Company ○ ○ ExxonMobil Lubricants & Specialties Company ○ ExxonMobil Research and Engineering Company • Chemical ○ ExxonMobil Chemical Company • ExxonMobil Global Services Company ○ ExxonMobil Information Technology ○ Global Real Estate and Facilities ○ Global Procurement ○ Business Support Centers Environmental record While it has been a contributor to environmental causes (the company donated $6.000 people in its Houston upstream headquarters. Hyderabad . The Political Economy Research Institute ranks ExxonMobil sixth among corporations emitting airborne pollutants in the United States. ExxonMobil's environmental record has been a target of critics from outside organizations such as Greenpeace as well as some institutional investors who disagree with its stance on global warming.A REPORT ON LUBRICANTS DISTRIBUTION .6 million to environmental and social groups in 2007).

which guide their activities and decisions. T. Hyderabad : 1965 . In 2006.A CASE STUDY OF MOBIL In 2005.43 billion).1. K.5 billion in 2006) and market value ($460. • Being an integral part of the customers business.. Rotex have the state of the art infrastructure and trained personnel to meet the requirements of our customers. ROTEX PETROCHEM PRIVATE LIMITED Rotex Petrochem Pvt Ltd. • Focus on adding value to the customer’s business. ExxonMobil's $340 billion revenues in 2005 were a 25. Profile Year of Establishment 19 | P a g e Aurora’s Business School. is a reputed name in Automotive Lubricants with a customer base of 1000+ Customers in the State of Andhra Pradesh.5 percent increase over their 2004 revenues.A REPORT ON LUBRICANTS DISTRIBUTION . Rotex Petrochem Pvt Ltd. Rotex Petrochem is driven by the following values. In 2007. a Chemical Engineer by training. in part due to expropriation of their Venezuelan assets by the Chavez government. • Being Proactive in terms of upgrading the infrastructure to meet the ever changing needs of the customers. ExxonMobil had a record net income of $40. The purpose is to establish as a reliable and major marketing player in Lubricant Business while maintaining highest level of integrity and ethical business practices and grow in a sustainable and profitable manner. are channel partners of world’s largest corporate Exxon Mobil Lubricants & Specialties Ltd. and Snap On tools(P) Ltd. 2008. Wal-Mart recaptured the lead with revenues of $348. an increase largely due to escalating oil prices as their actual oil equivalent production decreased by 1%. • Commitment to time • Ensure high service standards • Alignment of companies business policies with that of our principles and be an integral part of customers business thus adding value to customers business.552 of revenue. ExxonMobil occupied all 10 slots for Top Corporate Quarterly Earnings of all Time. Rao. founded in the year 1966 by Mr. maker’s of world class Automotive service equipment. ExxonMobil continued to lead the world in both profits ($39. As of April 1. ExxonMobil surpassed Wal-Mart as the world's largest publicly held corporation when measured by revenue.61 billion on $404. although Wal-Mart remained the largest by number of employees.7 billion against ExxonMobil's $335..

All Four wheeler/ two wheeler show rooms/wheel alignment Centers. automotive spares and filters : Retail workshops. Car Care Products. Petrol Pumps. Grease Equipments and tools. etc. Hyvek & brake Fluids & coolants.A REPORT ON LUBRICANTS DISTRIBUTION . DuPont Automotive Paints. Hierarchy of ROTEX: Product Portfolio of Mobil Mobil Delvac Mobil Super Mobil 1 4T oils Gear oils Greas e Product Depth ➢ Mobil Delvac  Delvac MX W40 15W40  Delvac Super 1300 15W40  Delvac 1340  Delvac 1300  Diesel Super 20W40 ➢ Mobil Super 20 | P a g e Aurora’s Business School.A CASE STUDY OF MOBIL Nature of Business Number of Employees Turnover Area of Operation Legal Status Major Markets Products : : : Wholesaler 26 to 50 People 20 Crores per year Market Potential : Manufacturers and Traders : Limited Liability/ Corporation (Privately Held) : Indian Subcontinent : Mobil Lubricants. Hyderabad . Car decors. Automobile shops.

A CASE STUDY OF MOBIL ➢ ➢ ➢ ➢  Super 1000 TM 15W40  Super 1000 MS 15W40  Super 10W30  Super HP 10W30  Special 20W50  Super FE Special 5W30  Super 1000 X2 20W50  Super XHP 10W40 Mobil1  Mobil1 5W50  Mobil1 0W40  Mobil Synt S 5W40 Mobil 4T oil  Super 4T 20W40 Gear Oils  Mobilube HD 80W90  Mobilube HD 85W140  Mobilube GX 80W90  Mobilube GX 140  Mobilube GX-A 80W  Mobilube SHC 75W90  Mobil ATF 220  Mobil multipurpose ATF Grease  Mobil XHP 222 Grease Present Channel adopted by Rotex Petrochem: To Rotex 21 | P a g e Aurora’s Business School. Hyderabad .A REPORT ON LUBRICANTS DISTRIBUTION .

A CASE STUDY OF MOBIL From Rotex 22 | P a g e Aurora’s Business School. Hyderabad .A REPORT ON LUBRICANTS DISTRIBUTION .

Hyderabad .A CASE STUDY OF MOBIL Interpretation & Data analysis Type of market Type of Number of market outlets PVL 81 CVL 58 Both 34 Source: Secondary data 23 | P a g e Aurora’s Business School.A REPORT ON LUBRICANTS DISTRIBUTION .

e. 24 | P a g e Aurora’s Business School.e. it can be analyzed that more number of outlets in D Grade selling less than 100litres per month.A REPORT ON LUBRICANTS DISTRIBUTION . more than 500 liters. Hyderabad . And only 11 outlets are selling Mobil oil in high volumes i.A CASE STUDY OF MOBIL Interpretation From the above data we can say that most of the outlets present in Hyderabad are of PVL Market i. Number of Outlets Outlet Grade Number of outlets A grade outlets ( more 11 than 500ltrs) B grade outlets( 25010 500ltrs) C grade outlets( 10043 250 ltrs) D grade outlets( less 109 than 100 ltrs) Source: Secondary data Interpretation From the above data. And only few outlets are serving both PVL and CVL market. passenger vehicles.

5 5434.A CASE STUDY OF MOBIL Sales of outlets Sale in Grade ltrs A grade outlets 16741 B grade outlets 3613. Hyderabad .A REPORT ON LUBRICANTS DISTRIBUTION .2 D grade outlets 5374.8 C grade outlets 7017. Most Sold Product Product Mobil 1 Mobil delvac Mobil super Mobil Special Sale in ltrs 69 12275.5 25 | P a g e Aurora’s Business School.3 Source: Secondary data Interpretation From the above graph we can say that major part of the sales are from A grade outlets. Around 64% of sales are from A grade outlets followed by c grade outlets.3 3922.

it can be observed that 27% of the outlets are having Castrol in their display. Mobil is having only a share of 19% standing in second position. 26 | P a g e Aurora’s Business School. gear oils and Mobil1 Display Shares Share display Mobil 19% Castrol 27% Servo 16% ELF 10% Gulf 7% others 21% Source: Secondary data Brand in Interpretation From the data available.A CASE STUDY OF MOBIL gear oils 1878 Source: Secondary data Interpretation From the above data we can say that Mobil Delvac is mostly sold in the outlets followed by Mobil Super. Hyderabad . Mobil Special.A REPORT ON LUBRICANTS DISTRIBUTION . Servo has a share of 16%.

outlets Bp 2 Castrol 16 Mobil 18 Servo 4 Source: Primary Data Brand of Interpretation From the above diagram we can say that Mobil is sold in most of the outlets. Hyderabad No of outlets 10 16 13 2 . servo and BP Mobil’s share in counter sale Counter share 0-24% 25-49% 50-74% 75-100% 27 | P a g e Aurora’s Business School.A REPORT ON LUBRICANTS DISTRIBUTION . followed by Castrol.A CASE STUDY OF MOBIL Most sold brand No.

28 | P a g e Aurora’s Business School. And only two outlets have a counter share more than 75%. Mobil super stands next. and 10 outlets have a counter share of less than 25%. Hyderabad . of Outlets 29 Mobil Super 11 Source: Primary Data Interpretation From the data available we can say that Mobil delvac is the most sold product of all the Mobil products. Most Sold Product Product Mobil Delvac NO.A CASE STUDY OF MOBIL Source: Primary Data Interpretation From the above data it can be seen that most of the Mobil products have a counter share of 25-49% and 50-74%.A REPORT ON LUBRICANTS DISTRIBUTION .

A CASE STUDY OF MOBIL Customer Driving Factor Factor Money Mechanic Suggestions Quality OEM Source: Primary Data Share 30% 35% 25% 10% Interpretation From the data it can be observed that mechanic suggestion plays an important role in deciding the lubricant by a customer. Factor outlets stock 28 time 12 Source: Primary Data 29 | P a g e Aurora’s Business School. Money. Hyderabad of In % 70% 30% . Order Placing Factor No. Quality and OEM (original Engine Manufacturers) factors stands next.A REPORT ON LUBRICANTS DISTRIBUTION .

5 in Interpretation From the above data.A REPORT ON LUBRICANTS DISTRIBUTION .5 62. Timely Delivery In time No. delivery outlets yes 15 no 25 Source: Primary Data of Share % 37. Hyderabad .A CASE STUDY OF MOBIL Interpretation The above data states that nearly 70% of the retailers place their order based on stock present in their outlet and only 30% place their order based on time factor. it can be observed that 63% of the retailers feel that the stock is not delivered in time to the outlets. 30 | P a g e Aurora’s Business School.

A REPORT ON LUBRICANTS DISTRIBUTION . Relation between Display and sales Brand Bp Castrol 31 | P a g e Aurora’s Business School. Brand outlets Bp 2 Castrol 17 Mobil 14 Servo 7 Source: Primary Data of Interpretation From the above data it can be observed that Castrol is mostly displayed in outlets. Hyderabad display 2 17 sale 2 16 . Mobil in 14 outlets and servo in 7 outlets. Castrol is displayed in 17 outlets.A CASE STUDY OF MOBIL Display Shares No.

Recieval of gifts & schemes. we can say that there exists a correlation between display and sales as most of the products that are sold in the outlet are kept in display.A CASE STUDY OF MOBIL Mobil 14 Servo 7 Source: Primary Data 18 4 Interpretation From the above data.A REPORT ON LUBRICANTS DISTRIBUTION . 32 | P a g e Aurora’s Business School. Hyderabad . yes No 26 14 Source: Primary Data Interpretation From the above data we can say that not all the retailers receive all the gifts and schemes. Only 70% of the retailers are getting all the gifts and schemes.

e.A CASE STUDY OF MOBIL Relation between Gifts and Outlet Grades Grade yes A 10 B 9 C 5 D 2 Source: Primary Data no 0 1 5 8 Interpretation From the above table. lower grade outlets are not properly provided with gifts & schemes. And the outlets having fewer sales i. of outlets .A REPORT ON LUBRICANTS DISTRIBUTION . Hyderabad No. Service Satisfaction Levels Satisfaction level 33 | P a g e Aurora’s Business School. it can be seen that the outlets having more sales are receiving all the gifts & schemes. There exists a positive relation between sales and recieval of gifts and schemes as outlets having more sales are getting the gifts & schemes.

of outlets 0 1 28 11 Interpretation 34 | P a g e Aurora’s Business School.A CASE STUDY OF MOBIL highly dissatisfied Dissatisfied satisfied highly satisfied Source: Primary Data 0 6 26 8 Interpretation From the above data it can be observed that more number of retailers are satisfied with the service and 20% of the retailers are highly satisfied with the service. Hyderabad . Overall Satisfaction levels Satisfaction level highly dissatisfied Dissatisfied satisfied highly satisfied Source: Primary Data No.A REPORT ON LUBRICANTS DISTRIBUTION . 15% of the retailers are dissatisfied with the service provided by the distributor.

we can say that more number of retailers are satisfied with the distributor and only fewer are highly satisfied with the distributor. of outlets .A REPORT ON LUBRICANTS DISTRIBUTION .A CASE STUDY OF MOBIL From the above data. Relation between the Satisfaction level and outlet grades Grad highly e dissatisfied A B C D Source: Primary Data dissatisfie d satisfied 2 7 10 9 highly satisfied 8 3 1 Interpretation From the above data we can say that more the sale in the outlet more the satisfaction level. Retailer’s advice Suggestion 35 | P a g e Aurora’s Business School. fewer the sale lower the satisfaction level of the retailer. And only one retailer is dissatisfied with the distributor. No retailer is highly dissatisfied with the distributor. Hyderabad No.

Relation between Suggestion and grade of the outlet.A CASE STUDY OF MOBIL advertisements branding Gifts & schemes Promotions others margins Source: Primary Data 10 6 5 5 4 10 Interpretation From the data.A REPORT ON LUBRICANTS DISTRIBUTION . it can be observed that more number of retailers suggested the distributor to increase advertisements and margins. And 6 retailers suggested branding. 5 retailers suggested gifts & schemes to motivate them to increase the sales of Mobil. Grad Advertisemen e ts A 2 B 1 C 3 D 4 Source: Primary Data Margin Brandin Gifts s g Schemes 3 2 1 2 3 3 1 6 & Promotio ns 2 2 Other s 1 1 2 Interpretation 36 | P a g e Aurora’s Business School. Hyderabad .

. Mallap ur Erraga dda. Moosa pet. AS 4 Rao nagar. 4 0 Autona 8 gar Attapu Gachibo 2 r.A CASE STUDY OF MOBIL From the data. 5 1 Chanda Narayan Nagar aguda Attapur 4 Shamsh abad 4 4 3 5 Vehi cle 3 KPHB. Hyderabad 37 | P a g e .A REPORT ON LUBRICANTS DISTRIBUTION . Gachi Sainikp 4 uri. we can say that lower the grade of the outlet. 5 Jublee 3 hills. Aurora’s Business School. Kukat pally Vehi cle 1 Auton agar Sec'bad Champa 2 pet. to increase the margin is the suggestion given and the upper grade outlets are mostly suggesting gifts & schemes as a motivation to increase sales of Mobil products. wli. LB 4 6 nagar 8 Nagar 1 4 5 Vehi cle 2 Siddia mbar bazaar 1 7 Ameerpet. ampally 5 2 BHEL. TRANSPORTATION Present route plan of Rotex: T ot al K m Monday Tuesday K Area m 4 8 Wednesday K Area m Thursday Friday K Area m 4 1 Saturday K Area m Area K Area m Habsig uda. BB 5 . 6 7 3 Masab Shamsh 6 0 tank abad Dilsuk Ghatkes 2 hnagar 3 9 ar. Bagling balkampet.

No. Medch al 3 0 1 5 0 7 5 1 7 6 0 2 8 Vehi cle 4 Masab Tank 5 Uppal Total 1 2 3 4 1 Total Distance travelled: The below table shows the distance travelled by each in a week.A CASE STUDY OF MOBIL bowli Tiruma lagherr y 4 0 1 1 9 1 1 3 Bowen pally. of liters diesel required 38 | P a g e Aurora’s Business School. Hyderabad =708/35 .A REPORT ON LUBRICANTS DISTRIBUTION . And the price of diesel to be 35Rs per litre. Vehicle Auto 1 Auto 2 Auto 3 Auto 4 Total Distance travelled(km) 230 258 145 75 708 The total expenditure incurred on transport in a week is Assuming that each auto gives a mileage of 35km per litre.

And the rent for each auto per day is 200rs. BHEL.A REPORT ON LUBRICANTS DISTRIBUTION . New route plan for Rotex: Monday Tuesday K Area m Wednesday K Area m Thursday Friday K Area m Saturday K Area m K m T ot al Area K Area m Vehi cle 1 Dilsuk hnagar . Konda pur. Shamsh 7 Mallapur 0 Masab abad . Total rent =200 * 3 =600Rs Total expenses = diesel expenses + rent for autos = (20*35) + 600 = 700 + 600 =1300Rs. Hyderabad 39 | P a g e . LB 4 Nagar.A CASE STUDY OF MOBIL =20. Aurora’s Business School. Chandana 5 Baghlin 2 5 gampall 1 y. 3 4 Siddiamba 2 r bazaar 0 Habsigu Attapu da. 5 r. Narayan Erragadd 3 Cham 4 Ghatkes 9 2 a. Nagar. 4 Auton agar Jublee hills. BB 6 8 Moosape LB Nagar 9 t. As an auto is taken for rent for three days in a week. KPHB. 8 ar. 5 papet. Uppal Tank 1 4 6 4 5 Vehi cle 2 Ameerpet.22ltrs ≈ 20ltrs.

A CASE STUDY OF MOBIL Gachib owli Masab Tank. AS Rao 4 nagar. 2 Sec’ba 4 d 1 0 2 gar aguda Kukatpal y Sainikpu ri. no expense on rents for autos is incurred. 0 abad Medchal 4 4 1 4 1 Total 1 0 5 6 5 5 5 1 5 4 9 0 5 Total Distance travelled: The below table shows the distance travelled by each in a week. Hyderabad . Vehicle Auto 1 Auto 2 Auto 3 Total Distance travelled(km) 165 289 141 595 The total expenditure incurred on transport in a week is Assuming that each auto gives a mileage of 35km per litre.A REPORT ON LUBRICANTS DISTRIBUTION . Total expenses = diesel expenses + rent for autos = (17*35) + 0 40 | P a g e Aurora’s Business School. 3 Tirumala gherry 1 2 8 Auton agar Vehi cle 3 Bowenpall 3 Shamsh y. of liters diesel required =595/35 =17ltrs As no any auto is taken for rent. No. And the price of diesel as 35Rs per litre.

• No proper distribution channel to supply products. Aurora’s Business School.2%. % of savings = 705/1300 = 54. • Most of the customers prefer short term benefits. Hyderabad 41 | P a g e . Findings: • Mechanics are playing an important role in the selection of lubricants. • Upper grade outlets are mostly satisfied with the distributor.A CASE STUDY OF MOBIL = 595 + 0 =595Rs. • Distributor are mainly concentrating on upper grade outlets and showing less interest on outlets having low sales.2% By using the above transportation model the transportation charges can be reduced by 54. By using the new transportation model the distance travelled by autos in a week can be reduced by 113Kms. • Gifts are not properly distributed to the dealers due to which customers are attracted to other products. leading to more distribution costs.A REPORT ON LUBRICANTS DISTRIBUTION . Expenses saved = 1300-595 =705Rs per week.

Hyderabad . • To revise the transportation model to reduce the transportation costs. • Less margins affect the willingness of dealers not to sell our product. • To attract the dealers to maintain Mobil products in display. 42 | P a g e Aurora’s Business School. Suggestions: • To create awareness about Mobil as most of the customers are unaware about Mobil.A REPORT ON LUBRICANTS DISTRIBUTION .A CASE STUDY OF MOBIL • Display plays a major role in sales. • To encourage the lower grade outlets to increase the sales. • To increase margins in order to drive the dealers to sell Mobil products.

Hyderabad . • Learned how to interact with different customers of different mindset. • Learned how to deal with mechanics. • How to interact with retailers. • How a distribution channel works.A CASE STUDY OF MOBIL Learning’s: • Knowledge about oils and lubricants used in automobiles.A REPORT ON LUBRICANTS DISTRIBUTION . 43 | P a g e Aurora’s Business School.

• Many dealers showed less interest in providing information and haven't cooperated. but only 40 outlets.A CASE STUDY OF MOBIL Limitations: • During the dealer study. some of the dealers did not give exact information. • The study was done only on retail segment but not on Install and M1CCO. • The study does not take into account the market Hyderabad as whole.A REPORT ON LUBRICANTS DISTRIBUTION . Hyderabad . 44 | P a g e Aurora’s Business School.

of Employees : : : : ANNEXURE Mechanics tied up with your outlet Mode of payment Cash Type of market PVL : Cheque Credit CVL Types of products available at the outlet 45 | P a g e Aurora’s Business School.A CASE STUDY OF MOBIL Questionnaire for Outlets Name of the Outlet Area DSR No.A REPORT ON LUBRICANTS DISTRIBUTION . Hyderabad .

A CASE STUDY OF MOBIL Spares Lubricants Car accessories Types of additional services provided by the outlet Mechanic Availability Others. Hyderabad Castrol Servo Total BP . please specify Type of lubes you deal with Engine oils Gear oil Coolants Hydraulic oil Break oil Grease Door delivery Which brand lubricants do you deal with? Mobil ELF Shell Gulf Others. please specify Which factor does the customer mostly thinks at the time of purchase? Do you suggest the customer at the time of purchase? ______________________________ Which oil do you suggest? __________ Why do you suggest that oil? __________ Counter share of outlet per month? __________ Counter share of Lubricants per month? __________ Which oil does your counter sale mostly? __________ What is the best oil in the present market? __________ Which pack size you sale mostly in your counter? __________ Counter share of Mobil per month? __________ Do you possess the catalogue of Mobil Products? __________ 46 | P a g e Aurora’s Business School.A REPORT ON LUBRICANTS DISTRIBUTION .

Hyderabad satisfied Highly dissatisfied . gifts and schemes? __________ Do you receive all the gifts and schemes mentioned by DSR from Mobil? __________ What are the advantages of Mobil? __________ What are the disadvantages of Mobil? __________ Are you satisfied with the distributor? Highly satisfied Dissatisfied Are you satisfied with the service? Highly satisfied Dissatisfied satisfied Highly dissatisfied satisfied Highly dissatisfied Are you satisfied with the distributor on whole? Highly satisfied Dissatisfied 47 | P a g e Aurora’s Business School.A CASE STUDY OF MOBIL What is the monthly consumption of Mobil in your outlet? __________ Which Mobil product gets mostly sold in your outlet? Mobil Super Mobil Delvac Mobil 1 Have you got any remark on Mobil from customers? __________ How frequently do you place an order? __________ On what factor do you decide to place an order? __________ In how many days does the distributor deliver you the ordered products? __________ Type of payment to the distributor Cash Cheque Credit Within how many days you have to do the payment? __________ How frequently DSR keeps visiting the outlet? __________ Does he keep updating about Mobil products.A REPORT ON LUBRICANTS DISTRIBUTION .

Hyderabad .A REPORT ON LUBRICANTS DISTRIBUTION .A CASE STUDY OF MOBIL Which oil company provides you more benefits? __________ What are the benefits provided by them? __________ What can Mobil do to motivate you to sell more Mobil products than any other brands in the market? __________ Suggestions (if any) 48 | P a g e Aurora’s Business School.

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