Case Analysis - Prithvi Electricals

Situation analysis

• Prithvi Electricals was a partnership firm with two brothers as its partners - Jayantilal and
Gordhandas.
• The firm was set up in 1976 by Jayantilal. In 1984, Prithvi Electricals entered into the
manufacturing field by making table top mixers(mixies). By 1996, it had started selling
2000 units a month.
• Prithvi had only one model of mixie. It also acquired BIS(ISI) certification for its product.
• The distributors made a margin of around 15% when sold to retailers who in turn made
18% margin. The margin was reduced during promotional schemes which was making
distributors unhappy.
• Prithvi as a mixie brand was well established in its target segment.
• Manufacturing schedule was primarily based on the gut feeling and past experiences.
• The manufacturing unit comprised of two sections -the motor assembly, with a capacity
of 2500 units of 250 watts, and the mixie assembly line which produced about 3000
units per month.
• The major sales came from south with 64% and least 3% from North.

Problem statement:

• Prithvi electrical facing issues with a distribution channels with dealers and retailers along
with upcoming competition in a market as the competitors are better in quality, price,
aesthetics, product range and warranty. How to address this issue and regain their position
in a market.

Product Analysis:

Strength Weakness
Price leader Inadequate relationship with dealers
Small, compact tabletop units No product range
Consumed less power Fewer features with heavy models
Made more noise Single product line
1-year warranty No innovation

This case can be analyzed through the business to consumer perspective with the following issues:

Collaborative: As the demands increased, they start appointed dealer who sold the product to
retailers which made their existing dealers unhappy and some of them pulled out of the Prithvi
dealership. With this there was no collaborative exchanges.
Mutually adaptive: The channel between dealers and company is getting shrink. As they were not
taking the problem seriously. Buyers were unhappy which lead to no trust and cooperation.

Buying and selling: They targeted the lower middle-class people who can afford at a price of Rs2000
easily compared to top brands. They promoted through the local newspaper, magazines, movie
house, price ads, finance schemes during the festive seasons with attractive discount schemes

Bare Bones: With more Companies expected to enter in the Indian mixer market like Chinese &
Korean with innovative marketing strategies better in quality, price, aesthetics, product range and
warranty leading to less adaptation by the seller and cooperation for their product.

Customer supply: They were neglecting the relationship with the existing dealers by appointing
new dealers to gain high margin which leads to bad relationship with not meeting their need.
Making their sales drop down by 10%.

Recommendations in Business market perspective:

Close suppler- customer relationship- They should establish credibility and trustworthy relationship
among dealers and come up with varieties of product. They need to address the problem of the
dealers to make a position in a market for a long run as more companies are getting entered with
innovative. To resolve and making the healthy relationship.

Derived demand: As the demand for business goods ultimately derived from the consumer goods.
For this reason, they should closely monitor the buying patterns of the end users.

Multiple buying influence: Gopal appointment is a good step for a company. As his 6 years of
experience in sales area may lead a company to next level with increased revenue growth by
coming up with new promotional plan. As Market share of AC motor was 85% with a growth rate of
10% per year. He has the liberty to design the distribution channels on his own and he should
establish a trustworthy relationship and keeping the margin of dealer and retailers in mind and
work with them on regular basis to get the feedback and work on them to address for the
company’s growth.