Roll No:-10624

PROJECT REPORT

On
“Brand Value”
Of

For
“Basmati Rice”

SUBMITTED BY: -
Harsh Dev Jaiswal
SUBMITTED TO:-
THE DEPARTMENT OF OPERATIONAL RESEARCH
FACULTY OF MATHEMATICAL SCIENCES
UNIVERSITY OF DELHI, DELHI

AS
PARTIAL FULFILLMENT OF THE REQUIREMENT
OF THE DEGREE OF MATHEMATICAL SCIENCES

IN

OPERATIONAL RESEARCH
UNIVERSITY OF DELHI, DELHI

SESSION 2013-2014

Department of Operational Research

Faculty of Mathematical Sciences
University of Delhi
Delhi-110007

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Name of the Student Harsh Dev Jaiswal

Date of Commencement of 15th FEBRUARY 2014

Project

Date of Submission of Project 30th APRIL 2014

Title of the Project “Brand Value of Shakti

Bhog for Bamati Rice”

Project Mentor Mr. Vishal Lal

: Shakti Bhog Foods Ltd.,

N.S.P. Pitampura, New Delhi

Name of the Supervisors from Prof. Chandra K. Jaggi

the teaching faculty Dr. P.C. Jha
Dr. (Mrs.) Preeti wanti Srivastava
Dr. Pankaj Gupta
Dr. K.K. Aggarwal
Dr. Ompal Singh
Dr. Adarsh Anand
Dr. Mukesh Kumar
Mehlawat
Mr. Kaushal Kumar
Dr. Aditi Khanna
Dr. Vandana Khaitan
Dr. Satish Kumar Goel

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 CERTIFICATE

This is to certify that the Project Report titled “Brand Value of

Shakti Bhog for Basmati Rice” is my original work carried out at
“Shakti Bhog Foods Ltd” in the year 2013-2014; and this has not
been submitted to any other University or Institution for the award
of any Degree or Diploma.

Harsh Dev Jaiswal

M.Sc. (Final) Operational Research
Department Of Operational Research
Faculty of Mathematical Sciences
University of Delhi
Delhi-110007

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 ACKNOWLEDGEMENT

One of the most pleasant aspects of writing a project is the

opportunity to thank those who have made it possible.
Unfortunately, the list of expression of gratitude- no matter how
expensive- is always incomplete and inadequate. These
acknowledgements are no exception.

I am extremely thankful to faculty members Prof C.K.Jaggi, Dr. K.

K. Aggarwal, Dr. (Mrs.) Preetiwanti Srivastava, Dr. P.C. Jha, Dr.
Pankaj Gupta , Dr. Ompal Singh , Dr. Aditi Khanna, Dr. Vandana
Khaitan, Mr. Kaushal Kumar, Dr. Adarsh Anand , Dr. Mukesh
Mehlawat, Dr.Satish Kumar Goel for their valuable guidance,
precious time and support in completion of this project.

Then my intellectual debt is to those academicians and

practitioners who have contributed significantly. During the course
of the project work, I was in constant interaction with many
company people, who were highly cooperative in laying down the
strategy for the project.

Last but not the least, I would like to thanks all the respondents for
giving me their precious time and relevant information and
experiences I required, without which this project would have been
a different story.

Harsh Dev Jaiswal

M.Sc. (Sem.-IV) Operational Research
Department of Operational Research
University of Delhi
Delhi – 110007

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 CONTENTS

Introduction to Operational Research

Algorithm for solving a problem

Application of Operational Research

Industry Profile

Company Profile

Marketing Research

Brand Value

Questionnaire Design

Factor Analysis

Research Objective & Methodology

Analysis, Interpretation & Conclusion

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 Bibliography

Introduction to Operational Research

Definition of Operational Research:

“Operations Research is the systematic application of quantitative
methods, techniques and tools to the analysis of problems involving the
operations of systems.”

--Daellanbach and George (1978)

Operations Research may be described as a scientific approach to

decision-making that involves the operations of organizational system.”
--F S Hiller and G J Lieberman, (1980)

““OR is the application of scientific methods, techniques and tools to

problems involving the operations of a system so as to provide those in
control of the system with optimum solutions to the problem.”
--C W Churchman, R L Ackoff & E L Arnoff

“OR is the art of giving bad answers to the problems which otherwise
have worse answers.”
--T L Satty

“OR is a scientific knowledge through interdisciplinary team effort for the

purpose of determining the best utilizations of limited resources.”
--H A Taha

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 OPERATIONAL RESEARCH -- AN OVERVIEW

Operational Research (OR) is an interdisciplinary branch of applied

mathematics and formal science that uses methods like mathematical
modeling, statistics, queuing theory, game theory, decision analysis, and
simulation to arrive at optimal or near optimal solutions to complex
problems. Because of the computational nature of these fields, OR also has
ties to computer science, and operations researchers regularly use custom-
written or off-the-shelf software.
Operational research is distinguished by its frequent use to examine an
entire system, rather than concentrating only on specific elements (though
this is often done as well). An operational researcher faced with a new
problem is expected to determine which techniques are most appropriate
given the nature of the system, the goals for improvement, and constraints
on time and computing power.
The use of OR is hidden from our daily lives to such an extent that most
people would be surprised at how much OR impacts them. This includes
the schedule for the bus they ride, the crews on the airplane they fly, the
route their garbage truck takes, the prices of their car rentals and air
tickets, the inventory in their favorite store, whether they can get an
answer from a call centre, how trees are sawn into products, and where
and how many spares are provisioned.

Professor P.M.S. Blackett was one of the first scientists to define the
essential elements of Operational Research, also known as the FATHER OF
OPERATIONAL RESEARCH. In October 1941 he wrote a Report on
Operational Research which is considered by many to be the original
'definition of Operational Research'. Of the use of scientists at the
operational level he said;

'The object of having scientists in close touch with operations is to enable

operational staffs to obtain scientific advice on those matters which are not
handled by the service technical establishments... Operational staff
provides the scientists with the operational outlook and data. The
scientists apply scientific methods of analysis to this data, and are thus able
to give useful advice. The main field of their activity is clearly the analysis
of actual operations, using as data the material to be found in an operations

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room, e.g. all signals, track charts, combat reports, meteorological
information, etc. . . .'

In 1947 Dr. Kittel described OR thus: 'Operations Research is a scientific

method for providing executive departments with a quantitative basis
for decisions.' A year later Sir Charles Good eve summed it up as
'quantitative common-sense’.

The first definitions of OR date from the 1950's. The father of OR, Professor
P.M.S. Blackett (later Lord Blackett), states:

'OR is a scientific activity conducted for executives'.

In 1947, Dr. Kittel’s expands a little bit into his well-known definition of
operational research as-

“A scientific method for providing executives with a quantitative basis for

decisions.”

In 1976 the UK Operational Research Society defined Operational Research

as:

“...Is the application of the methods of science to complex problems arising in

the direction and management of large systems of men, machines, materials
and money in industry, business, government and defence. The distinctive
approach is to develop a scientific model of the system, incorporating
measurements of factors, such as chance and risk, with which to compare the
outcome of alternative decisions, strategies or controls. The purpose is to
help management determine its policies and actions scientifically....”

Operations Research (OR) and the Management Sciences (MS) are the
professional disciplines that deal with the application of information
technology for informed decision-making.
Operations research is the science of decision making. OR methods involve
identifying business problems and possible scenarios for solving them. These
variables are modeled using various forms of applied mathematics implemented as
software algorithms. On a more granular level, the OR professional collects the
relevant data to instantiate the model, optimizes it, and then evaluates the results,
which provide business professionals with a suggested course of action.
OR can help the following kinds of business questions:

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How should the fleet of delivery trucks be allocated to meet customer
needs while making the best use of drivers?
What's the best breakdown of the marketing budget to maximize customer
response rates?
 Where warehouses should be located to minimize transportation
costs?
 What’s the impact of faster machinery on the factory production
process?

HISTORY OF OPERATIONAL RESEARCH

The term, Operations research, was first coined in 1940 by McClosky and Trefthen
in a small town Bowdsey, of the United Kingdom. This new science came to
existence in military context. During World War II, military management called on
scientists from various disciplines and organized them into teams to assist in
solving strategic and tactical problems associated with allied military effort, because
they were simply too complicated to expect adequate solutions from any one
individual, or even a single discipline and to discuss, evolve and suggest ways and
means to improve the execution of various military projects .By their joint efforts,
experience and deliberations, they suggested certain approaches that showed
remarkable progress. This new approach to systematic and scientific study of the
operations of the system was called the Operations Research or Operational
Research. (Abbreviated as O.R.).

After the war, many of the scientists who had been active in the military O.R. groups
turned their attention to the possibilities of applying a similar approach to civilian
problems. Some returned to universities and provide a sound foundation for many
of the techniques that had been developed earlier and also develop new techniques.
And in 1950, Operational Research achieved recognition as subject worthy of
academic study.

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In India, operations research came into existence in 1949 with the opening of an O.R.
unit at the regional research laboratory at Hyderabad. At the same time another group
was set up in defense science laboratory which devoted itself to the problems of store,
purchase and planning in 1953, an O.R. unit was established in the Indian statistical
institute, Calcutta, for the application of O.R. methods in national planning and survey
O.R. society of India was formed in 1957. It became a member of international
federation of O.R. societies in 1959. The first conference of O.R. society of India was
held in Delhi in 1959.it was also decided to start journals of operations research, which
took a practical shape in 1963 in form of ‘OPSEARCH’. In the same year, India along with
Japan became a member of International Federation of Operational Research societies
(IFORS) with headquarters in London.
In India Planning Commission made the use of O.R. techniques for planning the optimum
size of the carevelle fleet of Indian Airlines. In the industrial sector, in spite of the fact
that opportunities of O.R. work at present are very much limited, organized industries in
India are gradually becoming conscious about the role of Operational research.

SIGNIFICANT FEATURES OF Operational

Research APPROACH

INTER DISCIPLINARY APPROACH: O.R. is interdisciplinary in nature and requires a

team approach to a solution of the problem, because managerial problems have
economic, psychological, biological, sociological and engineering aspects. Hence it
requires a blend of people with expertise in the area of mathematics, statistics,
engineering, economics, management, computer science and so on.
Methodological (Scientific) Approach: OR employs scientific methods consists of
observing & defining the problem formulation and testing the hypothesis; and
analyzing the results of the test the data so obtained are then used to decide

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whether the hypothesis should be accepted or not.
Wholistic Approach: While arriving at a decision, an O.R. team examines the
relative importance of all conflicting and multiple objectives and the validity of
claims of various departments of the organization from the perspective of whole
organization
Objective Approach: An O.R. approach seeks to obtain an optimal solution to the
problem under analysis. For this, a measure of desirability is defined, based on the
objectives of the organization.

MODELS ON OPERATIONAL
RESEARCH

A model in O.R. is a simplified representation of an operation or a process in which

only the basic aspects or the most important features of a typical problem under
investigation are considered. Constructing a model aids inserting the complexities
and possible uncertainties attending a decision making problem into a logical
framework amenable to comprehensive analysis. Such a model clarifies the decision
alternatives their anticipated effects, indicate the relevant data for analysis the
alternatives, and leads to informative conclusions.

CLASSIFICATION OF MODEL
Although the classification of models is a subjective problem, they may be
distinguished as follows:

MODELS BY DEGREE OF ABSTRACTION

These models are based on the past data/information of the problems under
consideration and can be categorized into (a) language models (b) case studies.
MODELS BY FUNCTION
These models consist of
(a) Descriptive Models
(b) Predictive Models
(c) Normative Models.

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DESCRIPTIVE MODELS
These models describe, explain, and predict facts and relationships among the
various activities of the problem. These are used to describe mathematically some
particular aspects of the system being modeled. These models do not have an
objective the system being modeled. These models do not have an objective
function as apart of the model to evaluate decision alternatives. Thus, in a
descriptive model it is possible to get information as to how one or more factors
charge as a result of changes in other factors.

PREDICTIVE MODELS
These model indicates that “if this occurs then that will follow” .they relate
independent and dependent variables and permit trying out, ’what if’
questions. In other words, these models are used to predict the outcomes
due to a given set of the alternatives for the problem. These models do not
have an objective function as a part of the model to evaluate decision
alternatives.
NORMATIVE (OR OPTIMIZATION) MODELS

These models provide the “best” or “optimal” solution to the problems subject to
limitation on the use of resources. These models provide recommended courses of
action. For example, in mathematical programming, models are formulated for
optimizing the given objective function, subject to certain restrictions and non-
negativity of the decision variables.

MODELS BY STRUCTURE

These models are represented as:

(a) Iconic Models
(b) Analogue Models
(c) Symbolic Models.

ICONIC MODELS
Iconic model retains some of the physical properties and characteristics of the
system they represent. An iconic model is either in an idealized form of or a scaled
scale version of the system. In the other words, such models represent the system as
it is by scaling it up or down.
Examples of iconic models are blue prints of a home, globes, photographs, drawing,
atom etc.
Iconic models are easy to observe, build and describe but difficult to manipulate and
not very useful for the predictions. Commonly these models represent a static event.

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ANALOGUE MODELS
Analogue models are more abstract then iconic ones for there is no ‘look- alike’
correspondence between these models and real life items. They are built by utilizing
one set of properties to represent another set of properties. For instance a network
of pipes through which water is running could be used as a parallel for
understanding a distribution of electric current. Graphs and maps parallel in various
colors are analogue models, in which different color correspond to different
characteristics. A floe process chart is analogue model which represents the order of
occurrence of various events to make a product.

MATHEMATICAL OR SYMBOLIC MODELS

These models are more abstract in nature. They employ asset of mathematical
symbols to represent the components of the real system. These models are more
general and precise.

MODELS BASED ON DEGREE OF CERTAINITY

DETERMINISTIC MODELS
If all the parameters, constants and functional relationships are assumed to be
known with certainty when decision is made, then the model is said to be
deterministic. Thus in such a case, the outcome associated with particular course of
action is known. That is for a specific set of input values there is uniquely
determined output which represents the solution of the model under conditions of
certainty. Linear programming models are example of deterministic models.

PROBABILISTIC (STOCHASTIC) MODELS

Models in which atleast one parameters or decision variables is a random variable
are called probabilistic models. These models reflect to some extent the complexity
of the real world and the uncertainty surrounding it.

MODELS BY EXTENT OF GENERALITY

These models can be categorized into

(a) Specific models
(b) General models

SPECIFIC MODELS:
When a model presents a system at some specific time, it is known as a specific
model. In these models if time factor is not considered, then they are termed as
static model and dynamic model otherwise.
GENERAL MODELS:

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Simulation and heuristic models fall under general models. These models are mainly
used to explore alternative strategies which have been overlooked previously. These
models do not yield any optimum solution to the problem, but give a solution to the
problem depending on the assumptions based on the past experience.

METHODOLOGY OF OPERATIONAL RESEARCH

The systematic methodology developed for operations research study deals with
problems involving conflicting multiple objectives, policies and alternatives. O.R. in
the final analysis is a scientific methodology which is applied to the study of
operations of large complex organization and activities with a view to assessing the
overall implications of various alternative courses of action, thus providing an
improved basis for managerial decision.

It involves analysis of the physical system, setting Then O.R. approach to problem
solving consists of the following six steps:
1. Formulation of the problem: up of objectives, determination of restriction
constraints against which decision should be adopted, alternative courses of action
and measurement of effectiveness.
2. Construction of a mathematical model: after formulation of the problem, the
next step is to express all the relevant variables of the problem into a mathematical
model. A generalized mathematical model might take the form:
E = f (xi, yj)

3. Deriving the solution from the model: once the mathematical model is
formulated, the next step is to determine the values of the decision variables that
optimize the given objective function. This deals with the mathematical calculations
for obtaining the solution to the model.

4. Validity of the model: the model should be validated to measure its accuracy.
That is in the order for a model to be useful, the degree to which it actually
represents the system or problem being modeled must be established. A model is
valid or accurate if (a) it contains all the objectives, constraints, and the decision
variables relevant to the problem, (b) the objectives, constraints, and the decision
variables are all relevant to, or the actually part of the problem, and (c) the
functional relationships are valid.

5. Establishing control over the solution: After testing the model and its solution,
the next step of the study is to establish control over the solution. By proper
feedback of the information on the variables which deviated significantly. As soon as

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one or more of the control variables change significantly, the solution goes out of the
control in such as situation the model may accordingly be modified.

6. Implementation of the final results: Finally, the tested result of the model is
implemented to work. This would basically involve a careful explanation of the
solution to be adopted and its relationship with the operating realities. This stage of
O.R. investigation is executed primarily through the cooperation of both the O.R.
experts and those who are responsible for managing and operating the system.

SCIENTIFIC METHOD IN O.R.

The scientific method in operations research consists of the following three phases:
Judgment phase: This phase includes:
1. Identification of the real life problem.
2. Selection of an appropriate goal and the values of the various variables related to
the goals
3. Appropriate scale of measurement
4. Formulation of an appropriate model of the problem, abstracting the essential
formulation so that the solution at the decision maker’s can be sought.

Research phase: this phase is the largest and longest among the other two.
However other two also equally important as they provide basis for a scientific
method. This phase utilizes:

(i) Observations and data collection for better understanding of what the problem
is.
(ii) Formulation of hypothesis and models
(iii) Observation and experiment to test the hypothesis on the basis of
additional data
(iv) Analysis of the available information and verification of the hypothesis using
pre-established measures of effectiveness
(v) Predictions of the various results from the hypothesis
(vi) Generalization of the results and consideration of alternative methods.

Action Phase: This phase consist of making recommendations for decision process
by those who first posed the problem for consideration, or by anyone in a position
to make a decision influencing the operation in which the problem occurred.

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 APPLICATIONS OF OPERATIONAL
RESEARCH
Some of the industrial /government / business problems which can be analyzed by
O.R. approach have been functional area wise as follows:

Finance, budgeting and investment:

a) Cash flow analysis, long range capital requirement, dividend policies,
investment portfolios.
b) Credit policies, credit risks and delinquent account procedures.
c) Claim and complaint procedures.
Marketing:
a) Product selection, timing, competitive actions.
b) Advertising media with respect to time and cost.
c) Number of salesman, frequency of calling of accounts etc.
d) Effectiveness of marketing research.

Physical distribution:
a) Location and size of warehouses, distribution centers, retail outlets etc.
b) Distribution policy.

Purchasing procurement and exploration:

a) Rules for buying.
b) Determining the quantity and time to purchase.
c) Bidding policies and vendor analysis.
d) Equipment replacement policies.

Personnel:
a) Forecasting the manpower requirement, recruitment policies and
assignment jobs.
b) Selection of suitable personnel with due consideration of age and skills,
etc.
c) Determination of optimum number of persons for each centre.

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Production:
a) Scheduling and sequencing the production run by proper allocation of
machines.
b) Calculating the optimum product mix.
c) Selection location and design of the sites for the production plant.

Research and development:

a) Reliability and evaluation of alternative designs.
b) Control and developed projects.
c) Co-ordination of multiple research projects.
d) Determination of time and cost requirements.

USES OF OPERTAIONAL RESEARCH

Formulation of industrial problems may be generalized into different groups of

classical problems, the package program for which is available for mechanization
and manual solutions.

Various problem of optimization can be brought to the model of linear program for
which solution is available. While formulating the problem, the class of the
problem is to be decided and the parameters are to be defined accordingly.
Inventory control, production planning, product mix, transportation problem, etc.
are very common to the industries. The cost reduction with the help of these tools
is very much powerful in comparison to any other conventional method. We can
enumerate the advantages of these techniques as:

I. Optimum use of production factors: linear programming techniques

indicate how a manager can most effectively employ his production
factors by more efficiently selecting and distributing these elements.

II. Improved quality of decision: the computation table gives a clear

picture of happenings within the basic restriction and the
possibilities of compound behavior of the elements involved in the
problems. The effect on the profitability due to changes in the
production pattern will be clearly indicated in the table .e.g. simplex
table.

III. Preparations of future managers: these methods substitute a means

for improving knowledge and skills of your manager.

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 IV. Modification of mathematical solution: O.R. presents a possible
practical solution when one exists, but it is always a responsibility of
the manager to accept or modify the solution before its use. The
effects of these modifications may be evaluated from the
computational steps and tables.

V. Alternative solution: O.R. techniques will suggest all the alternative

solution available for the same profit so that the management may
decide on the basis of its strategies.

LIMITATIONS OF OPERATIONAL
RESEARCH

O.R. has certain limitations. These limitations are as follows:

a) Magnitude of computation: O.R. tries to find out the optimal solution
taking all the factors into account. In the modern society , these factors
are numerous and expressing them in quantity and establishing
relationship among these , requires huge calculations. All these
calculations cannot be handled manually and require electronic
computers which bear a very heavy cost. Thus the use of O.R. is limited to
only very large organizations.

b) Absence of qualification: O.R. provides solution only when all the

elements related to a problem can be quantified. The tangible factors such
as product, price, etc., can be expressed in terms of quantity, but
intangible factors such as human relations etc. cannot be quantified. Thus
these intangible elements of the problem are excluded from the study,
though these might be equal or more important than quantifiable
intangible factors as far as possible.

c) Distance between managers and operations research: O.R. being

specialist job requires a mathematician or a statistician, who might not be
aware of business problems. Similarly a manager may fail to understand
the complex working of O.R. Thus, there is a gap between one who
provides the solution and one who uses a solution. Thus, the manager
who becomes suspicious about the optimal solution. This problem is
mainly of training. Both the persons should have a working knowledge of

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 each other’s job to have better understanding of insights of the problem
and its optimal solution.

CHARACTORISTICS OF OPERATIONAL
RESEARCH
I. Such a team, when confronted with a problem, determines the solution
of the problem by following inter-disciplinary approach. Every expert
of the team tries to abstract the essence of the problem and determines
if the same type of problem has been previously undertaken or not. If a
similar problem has been dealt previously then it becomes quite easy
to apply the same technique to determine the solution of current
problem as well. In this way, each member of the team, by utilizing his
experience and expertise may be in a position to suggest an approach
that otherwise may not be thought of. Thus, Operational Research
makes use of experience Interdisciplinary Team Approach. It is an
important characteristic of operational research. According to this
characteristic, no single individual can be an expert on all aspects of a
problem under consideration. Thus, Operational Research utilizes the
inter-disciplinary approach i.e., an Operational Research team
comprises of experts from different disciplines and expertise of people
from different disciplines for developing new methods and procedures.

II. Operational Research is a continuing process. It cannot stop on the

application of the model to one problem, for this may create new
problems in other sectors and in the implementation of the decision
taken. Operational Research must also specify the organizational
changes required to implement decisions and control the result
thereof. Without this, the work of Operational Research practitioner is
incomplete.

III. Objective- Operational Research attempts to find the best or optimal

solution to the problem under consideration. To do this, it is necessary
to define a measure of effectiveness that takes into account the goals
(objective) of the organization. In other words “Operational Research is
the scientific study of large systems with a view to identify problem
areas and provide the managers with a quantitative basis for decisions
which will enhance their effectiveness in achieving the specified
objectives.”

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 IV. Operational Research increases the creative ability of a decision-maker.

V. Operational Research is a decision-making science.

VI. Uncovers new problems for study methods

VII. Examine functional relationship from a systems overview.

VIII. Operational Research gives only bad answers to the problem where only
worse could be given i.e.; it cannot give perfect answers to the
problems. Thus, Operational Research improves only the quality of the
solution.

IX. Methodological Approach. Operational Research utilizes the scientific

method. Specifically, the process begins with the careful observation
and formulation of the problem. The next step is to construct a
scientific (typically mathematical or simulation) model that attempts to
abstract the essence of the real problem. From this model, conclusions
or solutions are obtained which are also valid for the real problem. In
an iterative fashion, the model is then verified through appropriate
experimentation.

X. Operational Research replaces management by personality.

XI. Operational Research is for operations economy. Operational Research is

a problem solving and a decision-making science. Whenever we have
conflicts, uncertainty and complexity in a situation, Operational
Research can help in the end to reduce costs and improve profits and
effect substantial “Operations Economy.”

TEACHNIQUES OF OPERATIONAL
RESEARCH
The techniques discussed below can be freely used by a progressive manager in the
decision making process.

1) Probability: It is rarely possible to predict the future of the business

world with complete certainty. There is always an element of uncertainty
as far as the future courses of events are concerned. The probability
concepts try to analyze the uncertainties and bring out necessary data
with reasonable accuracy for the purpose of decision making. Probabilities

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 are of two types:

(i) Objective probability, and (ii) Subjective probability. The objective probability
is a probability for which there is a definite historical evidence and common
experience.

On the other hand, the subjective probability is a probability where historical

evidence is not available and the businessman has to rely on own estimation of a
situation and the likelihood of various outcomes.

The probability of any given action must be between 0 and 1 and the sum of all
these probabilities must be 1. If the probability is ‘0’ to an occurrence, it will not
take place and in the case the probability is 1 to an occurrence, it is certain that the
occurrence will take place.
2) Decision theory: The basic elements in a decision theory are:
a. Alternative course of action(strategies)
b. Various states of nature.
c. Knowledge about the likelihood of occurrence of each state of
nature.
d. Net value (pay-off) to decision-maker for each outcome.
e. Decision maker’s objectives.

The basic premise of decision theory is that the behavior of the future is
probabilistic and not deterministic. Various probabilities are assigned to the
state of nature on the basis of available information or subjective judgment and
the likely outcomes of the alternative courses of action are evaluated accordingly
before a particular alternative is selected.

This technique of decision making is based on expected monetary value and

utility. By analyzing the monetary value of utility from a given set of
circumstances, a model is constructed and accordingly decisions are taken. It is a
well-known fact that the environment within which decisions are taken can be
logically divided into three parts: certainty, risk and uncertainty. Certainty exists
when one can specify exactly what will happen when during the period for which
the decision is being made. Risk refers to a situation where one can specify a

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probability distribution for the possible outcomes. Uncertainty refers to the
condition when one cannot specify the relative likelihood of the outcomes.
Although some business decision can be made under condition nearing certainty,
elements of risk and uncertainty underline most of the decisions which mangers
make.
3) Linear Programming: It is a method for selecting an optimum
combination of Factors from a series of inter-related alternatives, each
subjective to limitation. It involves the development of linear equations to
obtain the best solution for the allocation problem. An allocation problem
“...arise whenever there are a number of activities to perform but
limitations on either the amount of resources or the way they can be spent
prevent us from performing each activity in the most effective way
conceivable. In such situations we wish to allot the available resources to
the activities in a way that will optimize the effectiveness”.

Linear programming consists of:

a. The Simplex Method. This aims at maximizing or minimizing a given
function, subject to constraints in respect of each variable.

b. The Transportation Problem. This deals with problems of matching

the origins (stores, warehouse, and factories) with the outlets (process
centre, market etc.) at a minimum cost of distribution and
transportation.

c. The Assignment Problem. It can handle the problems of assigning a

given number of agents each one to the same number of tasks so as to
result in maximum efficiency or minimum cost.

4) Dynamic Programming: This technique deals with the problems that

arise in connection with multi period analysis and decisions. In contrast to
Linear Programming there does not exists a standard mathematical
formulation of Dynamic Programming, rather it is a general type of
approach to problem solving and particular equation must be developed
to fit each individual situation. However, the basic approach used in
Dynamic programming is to break down a problem into series of problems
in such a way that answer to the first sub problem can be used in deriving
the solution to the next sub-problem and so forth finally giving solution to

22 | P a g e
 the whole problem.

5) Sequencing: This method solves problem where effectiveness measure (in

terms of cost, time, mileage, etc.), depends upon the sequence of
performing given jobs. This helps to determine a sequence in which given
jobs should be performed if the objective is to minimize the total efforts.

6) Game Theory: Developed by Jon Von Neumann and Morgenson, this is a

mathematical theory applicable to competitive business problems. This
technique deals with situations where two or more (finite) individuals are
making decisions involving conflicting interests. However the final
decision depends upon the decisions of the parties concerned.

7) Inventory Control and Management.: Inventory problems(models) are

mainly concerned with inventory decisions, the basic inventory decisions
are:

a. How much to order at one time, and

b. When to order this quantity.

The first decision namely – how much to order at one time, is to be balanced
between two pressures – the first pressure is to order huge lots so as to
minimize ordering costs and the other pressure is order small lots so as to
minimize carrying costs. The optimum course of action is a compromise between
the two extremes. Arriving at a model for deriving the economic order quantity
(E.O.Q) can do this.

The second decision namely – when to order this quantity, is decided by

ascertaining the re-ordering level. The re-ordering level is the point lying
between the maximum and the minimum levels at which time it is essential to
intimate the purchase department for fresh supplies of the material. This point
will usually be slightly higher than the minimum stock, to cover such
emergencies as abnormal usage of material or unexpected delay in delivery of
fresh supplies. Re-ordering level depends upon lead-time, rate of consumption
and economic ordering quantity.
8) Queuing Theory: Waiting lines at any service centre are common
phenomena and Queuing theory is devoted to mathematical study of

23 | P a g e
 waiting lines. Various alternative models have been used to describe such
situations, but they basically share the following common features: (i)
Units requiring services are generated from an input source from different
kinds of queues for service, (ii) a service discipline by which the queue
members are selected for receiving service, (iii) a service mechanism
which defines the type of service, after the completion of which unit leaves
the system or rejoins it for further processing. Many alternative
assumptions can be made about these common elements, and these give
rise to the different queuing problems.

9) Network Analysis (PERT/CPM): PERT or Program Evaluation and Review

technique and CPM or Critical Path Method are powerful management
tools for planning and control of complex jobs involving a large number of
activities. A project consists of well-defined collection of jobs or activities,
some of which can be started independently of others and all the jobs have
to be carried out in technological sequence. The objective of PERT/CPM
technique is to establish time duration for each activity and to shorten the
total duration acquired for the completion of the project incurring the
optimum cost. CPM introduces the concept of critical path, i.e., the longest
time required to complete a project and emphasizes the reduction of the
duration of the activities by the application of more resources by obtaining
a trade-off between cost and time completion.

10) Simulation: It is highly versatile technique of operational research. It

has a wide-ranging application in business situations. Simulation is
particularly appropriate where it is difficult to build a model for the real
life situation mathematically or if at all it is modeled, it is difficult to solve
the model analytically. It may be noted that simulation is a manipulation of
a model constructed from the formal statements of mathematical
representation in respect of logical relations between the elements in a
structure or a system expressed in measurable terms. Thus, simulation is a
process of designing an experiment, which will duplicate or present as
nearly as possible the real situation and then watching what does happen.
In every walk of life, the test of adequacy of our decisions is the test of our
reality. However, in practical life, modern business cannot afford the
luxury of testing the consequences of the major decisions in the real-life
world. Instead of finding out the characteristics of an aircraft or a
skyscraper, by actually building or constructing it, we can simulate its
performance on the basis of its characteristics. In this way we can
experiment without incurring the cost of failure. The simulation

24 | P a g e
 techniques allow the modern managers to examine the probable
consequences of his decisions without the risk of real life experimentation.

11) Replacement Theory: This theory suggested the determination of the

time when items of plant should be replaced. The replacement of items is
necessary because the efficiency of an item deteriorates with time, or
sometimes the item may fail completely. Replacement, on the one hand,
requires investment, on the other, saves operating cost which otherwise is
more while using old parts. Thus, a problem arises when the part should
be replaced so that cost is minimum. The replacement problems arises in
three conditions:

(i) Replacements of item that fail completely and are expensive to be

replaced.
(ii)Replacement of items whose efficiency deteriorates with time
(iii) Replacement of items because of obsolescence.

12) Reliability: Reliability theory is concerned with quantifying the

frequency of failures and developing an indicator of quality and
dependability of a product. It is closely associated with probability theory
and therefore facilitates statistical analysis and measurement.

The assessment of reliability of equipment is most useful to the designer in

improving the quality of critical parts as well as in deciding how much to provide
by way of standby.

13) Some Advance O.R. Techniques:

i. Non-linear programming is that form of programming in which
some or all of the variables are curvilinear. In other words, this
means that either the objective functions or the constraints or both
are not in liner form. In most of the practical situations, we
encounter with non-linear programming problems.

ii. Integer programming. Integer programming applies when the

values of decision variables are restricted to integers. Applications
include Financial Management and Plant Location.

iii. Goal programming. Goal programming deals with the problems

having multiple objectives. It is a technique quite similar to linear

25 | P a g e
 programming. Applications include production scheduling,
transportation problems, portfolio analysis and crop selection in
agriculture.

iv. Heuristic programming also known as discovery method refers

to step by step search towards an optimal when a problem cannot
be expressed in mathematical programming form. The search
procedure examines successively a series of combinations that lead
to stepwise improvement in the solution and the search stops when
near optimal has been found.

v. Algorithmic programming is just the opposite of Heuristic

programming. It may also be termed as mathematical programming.
This programming refers to a thorough and exhaustive
mathematical approach to investigate all aspects of given variables
in order to obtain optimal solution.
vi. Quadratic programming refers to a modification of linear
programming, in which the objective function and constraint
equations appear in quadratic form, i.e., they contain squared terms.

vii. Probabilistic programming also known as stochastic

programming refers to linear programming that includes an
evaluation of relative risks and uncertainties in various alternatives
of choice for management decision.

Markov Analysis: The Markov analysis is a method of analyzing the current

movement of some variables in an effort to predict the future movement of the
same variable. Russian mathematician, A. Markov developed this analysis, early
in the 20th century. As a management tool, the Markov analysis has been used in
the last few years mainly as a marketing aid for examining and predicting the
behavior of the consumer in terms of their brand loyalty and their switching
from one brand to another. A full treatment of the application of Markov analysis
to managerial decision making would require an extensive background in
mathematics. This technique, however, can be most favorably applied.

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 BASMATI RICE INDUSTRY
PROFILE

What is Basmati Rice?

Many times people have asked what the meaning of basmati rice is. Basmati rice has
been reported in India since the early days of the 19th Century though it may have
been named differently. 'Bas' in Hindi language means "aroma" and 'Mati' means
"full of" hence the word Basmati i.e. full of aroma. This rice is different from other
rice mainly due to the aroma and elongation post cooking. No other rice has this
combined characteristic. The post cooking elongation of more than twice its original
length, the aroma and its sweet taste has made basmati rice a delicacy. Basmati rice
is grown only in Northern India and in parts of Pakistan touching India. One can
easily call it the Champagne of India.

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History of Basmati Rice:
Basmati is a Sanskrit word meaning "fragrant". Basmati rice has been cultivated in
India for thousands of years and originates from India. Basmati was introduced to
the Middle East by various Indian traders. Through cultural exchange, it remains not
only an important part of various Indian cuisines but now is also used extensively in
Persian and other Middle Eastern cuisines. Basmati Rice is considered to be the
benchmark for all types of Rice. India continues to be the largest cultivator of this
rice.

Production and Cultivation:

The areas of basmati rice production in India are in the states
of Punjab, Haryana, Jammu & Kashmir, Himachal Pradesh, Delhi, Uttarakhand, Uttar
Pradesh and Bihar. India's total basmati production for the 2011/12 crop year that
ended June was 5 million tons. In Pakistan, 95% of the basmati rice cultivation takes
place in the province of Punjab, where total production was 2.47 million tons in
2010. In India, Haryana is the major basmati rice cultivating state, producing more
than 60% of the total basmati rice produced in India.

Haryana presently accounts for almost 60 percent of the area being used for
cultivating basmati rice. Karnal district, which is often referred to as the rice bowl of
India produces the finest quality of basmati rice. Apart from Karnal, Panipat,
Kurukshetra, Kaithal, and Ambala are the major rice growing districts in the
northern state.

Varieties and Hybrids:

There are several varieties of basmati rice. Traditional Indian types include basmati
370, basmati 385, and basmati Ranbirsinghpura (R.S.Pura). Pakistani varieties of
basmati rice are PK 385, 1121 Extra Long Grain Rice, Super Kernel Basmati Rice and
D-98.

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Scientists at Indian Agricultural Research Institute, Delhi, genetically modified
basmati to produce a hybrid semi-dwarf plant which had most of the good features
of traditional basmati (grain elongation, fragrance, alkali content). This hybrid was
called Pusa Basmati-1 (it is also called "Todal", because the flower has awns); crop
yield is up to twice as high as traditional varieties. Fragrant rices that are derived
from basmati stock but are not true basmati varieties include PB2 (also called
sugandh-2), PB3, and RH-10.
List of approved varieties

Indian varieties:
Punjab, Uttar Pradesh, Safidon, Haryana, Kasturi (Baran, Rajasthan), Basmati 198,
Basmati 217, Basmati 370, Bihar, Kasturi, Mahi Suganda, Pusa.
Pakistani varieties:
Basmati 370, Super Basmati, Pak (Kernal) Basmati, Basmati 386, Basmati 385 and
Basmati 198.
Kenyan variety:
A variety of Basmati called Pishori or Pisori is grown in the Mwea region of Kenya.
American varieties:
A variety of Basmati called Texmati is grown in the United States of America.

India Basmati Rice Industry Competition:

The exporters of basmati rice in India are expected to face a lot of competition from
their counterparts in Philippines during 2013.The Philippines is looking to improve
its best rice variety so that exports can be started from 2013. At present the
Agricultural Department in the Southeast Asian country is making attempts to
cultivate the basmati rice. 

India, at present, is the biggest exporter of basmati rice in the world. It produces
nearly 7.5 million tons and exports approximately 2.5 million tons. Philippines, on
the other hand, is fairly self-sufficient as far as rice production goes. 

Reports state that a 6000 hectare area has been identified in Compostela Valley by
the Philippine government. It is being considered perfect for production of basmati
rice. It is aiming to target the Middle East as a potential client base. Right now, India
is the most prominent exporter of basmati rice to these countries as well as Iran

29 | P a g e
Basmati Rice as business in INDIA:
A study says that 26% (approximately) of total quantity of basmati rice exported
from India only. It’s mean that India is number one in basmati rice production. So
business opportunity is very high in India. So a number of branded companies deal
in basmati rice business in India. These branded companies have a very wide range
of market not only in India but also across the world.

The branded companies which deal in basmati rice in India are given below:
Best Basmati Rice
Kohinoor Basmati Rice
India Gate Basmati Rice
Shakti Bhog Basmati Rice
Dunar Basmati Rice
Dawat Basmati Rice
Doon Basmati Rice
Lal Qilla Basmati Rice
Saffola Aries Basmati Rice
Tirupati Basmati Rice

Lal Qilla 
Lal Qilla basmati rice is a product of S Amar Singh whose business started as a
small establishment about 6 decades ago. Since then the company has emerged
to become one of the top names in this market. It is also one of the leading rice
manufacturing companies in the country. Following are the major brands of the
organization in addition to Lal Qilla:

 Qilla
 Shahjahan

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 Golden Qilla
 Amar
 President

Daawat 
Daawat basmati rice is a product of LT Foods Limited. The company’s head offices
are at Gurgaon and it has approximately 900 workers. In 2011 its net sales
amounted to INR 1281 crore Daawat, the flagship brand was introduced during the
1980s and is presently one of the top names in the industry. 

Its products are available in three ranges that may be mentioned as below:

 Premium Range
 Food Service
 Consumer Range

Kohinoor 
Kohinoor basmati rice is manufactured and marketed by Kohinoor Foods Limited.
Apart from basmati rice, Kohinoor offers ready to eat products, spices, cooking
sauces, seasonings, cooking pastes, and frozen food. Its products are available in
Europe as well as the following locations:

 US
 Japan
 UK
 Australia
 Dubai
 Singapore
 Canada

Doon 

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Doon basmati rice is a product of KRBL Limited, which was incorporated during
1889 and in its 120 years of existence it has become one of the leading exporters of
basmati rice in the world. It is also regarded as one of the biggest rice millers in the
world. In the Doon brand following are the main variants:

 Basmati rice premium

 Mini dubar
 Basmati rice dubar
 Mogra
 Basmati rice Tibar
 Mini Mogra

Shakti Bhog
Founded by Mr. KK Kumar in 1970, Shakti Bhog Food Ltd. is a pioneer in
manufacturing & packing of daily use item like wheat flour. This Rs15bn Company
successfully uses its brand value to enter other daily use consumption items like
Rice, Salt and Porridge. The other products that come under Shakti Bhog are wheat
flour, gram flour, basmati & non-basmati rice, Missi Roti, Iodized Atta, Tea, Pickles,
Fruit Jams & mixed Fruit Jams. In addition to this, the company has been exporting
products to almost 38 countries worldwide.

Contribution in this field:

Basmati rice is like wine, it only gets better with age, says Anil K. Mittal, Chairman
and Managing Director of India's top rice exporter, KRBL, who has been in the rice
industry for more than four decades. "In the basmati rice industry, the most
important asset is experience in the commodity. It takes time to acquire. Old is gold
here, unlike with most other commodities where the old gets discarded," says the
Delhi-based miller and exporter.

Mittal has been in the rice business long enough to know. He used to supply rice to
big exporters for years before he decided to start exporting the grain himself in
1987. His big break came when he supplied 500,000 tons of basmati to Zee Group
Chairman Subhash Chandra's Rama Associates in the early 1980s. In 1987, Mittal
went to Saudi Arabia to secure export orders directly - and there's been no looking
back since. Mittal invested Rs. 25 lakh to set up a unit near Delhi with a capacity to

32 | P a g e
process six tons an hour; by 1993, KRBL was exporting 35,000 tons and had a one-
tenth share of basmati exports. Kohinoor Foods and LT Foods were established
exporters at that time. KRBL went public in 1995 and raised Rs. 15 crore. "By 2000,
we were the heroes of basmati exports," says Mittal.
Today, KRBL's India Gate brand is a leading export brand and its Rs. 2,100 crore
turnover is almost twice that of Kohinoor Foods, another major basmati rice
company. It reported a Rs. 150-crore profit in the last financial year. 

"I started my career in the early 1970s with trading in rice. Basmati used to be
exported only through public sector undertaking STC (State Trading Corporation)
until 1978 when the Janata government opened it to the private sector as well. We
became suppliers to leading domestic exporters," says Mittal. "We realized soon the
need to process and make our own rice. We set up our first plant in Ghaziabad
which became operational in 1990. We were the first domestic company to import a
fully automated rice milling plant."
As a rice baron, Mittal has played a key role in the transformation of the trade. He
dared to pick up two relatively unknown rice varieties on two occasions and made a
killing from them. In 2003, KRBL became the first domestic rice company to receive
foreign investment of Rs. 27 crore and in 2006, it raised $12 million through the
biggest GDR issue of the Indian rice industry. Its venture into renewable energy is
paying off too. It meets all its fuel needs from a 14-MW captive power plant that
uses rice husk and earns close to Rs. 1 crore a year through carbon credits. The
company also sells unrefined rice bran oil to edible oil refiners and plans to set up a
100-tonne refinery to sell rice bran oil under its own brand. Several international
companies such as Olam have approached Mittal for an equity sale in the past.

33 | P a g e
 Company Profile
Of

About Company:

(Mr. KK Kumar)
Shakti Bhog founded by Mr. KK Kumar in 1970, as Shakti Bhog Food Ltd. is a
pioneer in manufacturing & packing of daily use item like wheat flour. This Rs15bn
Company successfully uses its brand value to enter other daily use consumption
items like Rice, Salt and Porridge. The other products that come under Shakti Bhog
are wheat flour, gram flour, basmati & non-basmati rice, Missi Roti, Iodized Atta,
Tea, Pickles, Fruit Jams & mixed Fruit Jams. In addition to this, the company has
been exporting products to almost 38 countries worldwide.
Mr. K.K. Kumar, Managing Director, Shakti Bhog Foods Pvt. Ltd has more than
40 years of experience in the industry. After completing his graduation from Shri
Ram College of Commerce, K.K. Kumar joined his father’s family business. Then in
the year 1981, he started his own Granding Mill (Packed Atta). His talent and
expertise has taken his family business to an international stature and the present

34 | P a g e
state of Shakti Bhog is such that it has made its presence in almost every part of
India and in international markets as well.
It is the most reputed name in the field of food products. The brand – Shakti Bhog is
India’s fastest selling wheat flour and has made it a popular name in the global
market. The distinctiveness of its products and further broadening of products line
has established it as the most acknowledge manufacturer, exporter and supplier of
Wheat Flour, Basmati and Non-Basmati Rice, Poha, Daliya, Beshan, Biscuits,
Semoline (suji), etc. Its Impeccable quality products, cost effective production
process, voluminous experience of the market and prompt delivery has fetched it
tremendous customer response in overseas markets like USA, New Zealand,
Australia, UAE, Qatar and host of other countries. The work culture of this
organization is focused on high performance, innovations, entrepreneurship and
empowerment. Its products have been well appreciated by all its clients, which
motivates us to elevate the standard of excellence.

They are a leading producer in milled product segment in Indian processed food
industry, products like Packaged Atta (Whole Wheat Flour), Besan (Gram Flour),
Samoline (Suji), Basmati Rice and Dalia (Porridge) are part of our product line. They
produce three kinds of Flour, two kinds of Porridge and different variety of Basmati
Rice. Absolute hygienically proven and tested quality checks are undertaken at
every level of the production process, in order to make sure that only quality proven
batches of products are dispatched in the market.

Products:

They offer a wide and comprehensive range of products, which include:

Wheat Flour Rice (Royal Swad, Authentic,

Premium Gold, Basmati & non-
Basmati)
Poha Gram Flour(Besan)
Semolina (Suji) Maida (White Wheat Flour)
Instant Daliya Daliya
Biscuits Cookies

Infrastructure:
This company is empowered with a state-of-the-art infrastructure, requisite
technology, efficient transport facilities and superb working environment. They

35 | P a g e
possess a spacious warehouse which can store large quantities of products. They are
backed by a well-qualified and technical team of astute technocrats, business
oriented professionals and diligent workers, who are highly experienced and have a
thorough knowledge in the relevant field. The team is capable of sourcing large
volumes of products to satisfy the customer demands and specifications. They
possess one of Asia's largest Wheat Flour Manufacturing Plant which is installed in
our in-house production unit. They have the capacity to produce 3000 mt. Wheat
Flour as per the European Standards on daily basis. Their wide network of
distributors and suppliers are scattered all over the globe ensuring the customers of
safe, smooth and punctual delivery of products.

Packaging:
'Packaging' is supposed to be the fifth "P" in marketing. After product, price, place
and promotion, packaging is the element which holds the maximum importance in
the marketing of a product. As majority of the purchase decisions are made in store,
they ensure that our products are attractively packed so as to capture the attention
of the buyers. Their products are packaged in different quantities depending upon
the different segment and market.

Company Profile
Business Type : Exporter , Manufacturer , Supplier
No of Staff : 2000+
Year of : 1970
Establishment
Export to :- USA, UK, Europe,
Export Markets Europe :- Germany, Spain, Switzerland,
: Narway, Sweden, Denmark
Middle East.:- Dubai, Saudi- Arabia, Kuwait,
Oman, Doha, Qater, Bahrain
Asia Pacific :- Singapore, Bangladesh, Hongkong,
China, Japan, Solemen, Island,
Burnai, Congo
Africa :- South Africa, Ghana, Mozambique,
Nigeria, Sudan
Austria :- Perth, Adelaide, Sydney and
Melbourne

36 | P a g e
OEM Service : Yes
Provided
Production : automatic and semi-automatic
Type
Monthly : As Per Requirement
Production
Capacity
Memberships : APEDA

Product Range: Wheat Flour Rice (Royal Swad, Authentic,

Premium Gold, Basmati & non
Basmati)
Poha Garm Flour
Semolina (Suji) Maida (White Wheat Flour)
Instant Daliya Daliya
Biscuits Cookies

37 | P a g e
It’s different Varieties of Basmati Rice

Royal Swad :

Premium Basmati Rice:

38 | P a g e
Export Gold Rice:

Premium Gold Rice:

Authentic Basmati Rice:

39 | P a g e
 Indian Traditional Basmati Rice:

Marketing Research
Marketing research is the systematic and objective identification, collection,
analysis, dissemination and use of information for the purpose of assisting
management in decision making related to the identification and solution of
problems in marketing.

Marketing Research is the collection and analysis of data from a sample of

individuals or organizations related to their characteristics, behavior, attitudes,
opinions or possessions. It includes all forms of research such as consumer and
industrial survey, psychological investigations, observations and panel studies.

It can be defined as the means of acquiring information to assist in the making of

marketing decisions under uncertainty.

It is the systematic and objective search for, and analysis of, information relevant
to the identification and solution of any problem in the field of marketing.

Marketing Research is the systematic design, collection, analysis and reporting of

40 | P a g e
 data and findings relevant to a specific marketing situation facing the company.

PURPOSE OF MARKETING RESEARCH

The main purpose of marketing research is to provide information, which will
facilitate the identification of a problem situation, and to assist in arriving at the
best possible decisions when such situations are encountered. The market
research analysts provide this information to the company.

Research analysts are concerned with the potential sales of a product or service.
They analyze statistical data on past sales to predict future sales. They gather
data on competitors and analyze prices, sales, and methods of marketing and
distribution. Like economists, market research analysts devise methods and
procedures for obtaining the data they need. They often design telephone,
personal, or mail interview surveys to assess consumer preferences. After
compiling the data, market research analysts evaluate it and make
recommendations to their client or employer based upon their findings. They
provide a company’s management with information needed to make decisions on
the promotion, distribution, and design and pricing of products or services.

A CLASSIFICATION OF MARKETING RESEARCH

MARKETING RESEARCH

Marketing Research is classified as:-

1. Problem identification research

 marketing potential research
 market share research
 image research
 market characteristic research
 sales analysis research

41 | P a g e
  forecasting research
 business trends research

2. Problem solving research

 Segmentation research
 Product research
 Pricing research
 Promotion research
 Distribution research

MARKETING RESEARCH PROCESS

Marketing research process consists of several steps that define the task to be
accomplished in conducting a market research study.

Step-1
Problem Definition
The first step in marketing research project is to define the problem. In defining the
problem, the researcher should take into account the purpose of the study, the
relevant background information, the information needed and how it will be used in
decision making. Problem definition involves discussion with the decision makers,
interviews with industry experts, analysis of secondary data, and perhaps some
qualitative research, such as focus group.

Step-2
Development of an approach to the problem
Development of an approach to the problem to the problem includes formulating an
objective or theoretical framework, analytical models, research questions and
hypothesis and identifying the information needed.

Step-3
Research design formulation
A research design is a framework for conducting the marketing research project.

Formulating the research design involves the following steps:-

1. Definition of the information needed

42 | P a g e
 2. Secondary data analysis
3. qualitative research
4. methods of collecting quantitative data
5. measurement and scaling procedures
6. questionnaire design
7. sampling process and sample size
8. plan of data analysis

Step-4
Fieldwork or data collection
Data collection involves a field force or staff that operates either in the field as in the
case of personal interviewing. (In home, mall intercept or computer assisted personal
interviewing) from an office by telephone, through mail.

Step-5
Data preparation and analysis
Data preparation includes the editing, coding, transcription and verification of data.
Each questionnaire is transcribed. The data are analyzed to derive the information
related to the components of marketing research problem. And this provides input in
to the management decision problem.

Step-6
Report preparation and presentation
The entire project should be documented in a written report that addresses the
specific research question identified, describes the approach, the research design, data
collection and data analysis procedures adopted and present the results and the major
findings.

43 | P a g e
 Brand Value

Brand Value is a phrase used in the marketing industry which describes the value

of having a well-known brand name, based on the idea that the owner of a well-
known brand name can generate more money from products with that brand name
than from products with a less well-known name, as consumers believe that a
product with a well-known name is better than products with less well-known
names.
Some marketing researchers have concluded that brands are one of the most
valuable assets a company has, as brand value is one of the factors which can
increase the financial value of a brand to the brand owner, although not the only
one. Elements that can be included in the valuation of brand value include (but not
limited to): changing market share, profit margins, consumer recognition of logos
and other visual elements, brand language associations made by consumers,
consumers' perceptions of quality and other relevant brand values.
Consumers' knowledge about a brand also governs how manufacturers and
advertisers market the brand. Brand value is created through strategic investments
in communication channels and market education and appreciates
through economic growth in profit margins, market share, prestige value, and
critical associations. Generally, these strategic investments appreciate over time to
deliver a return on investment. This is directly related to marketing ROI. Brand
value can also appreciate without strategic direction. A Stockholm University study
in 2011 documents the case of Jerusalem's city brand. The
city organically developed a brand, which experienced tremendous brand

44 | P a g e
value appreciation over the course of centuries through non-strategic activities. A
booming tourism industry in Jerusalem has been the most evident indicator of a
strong ROI.
Brand value is strategically crucial, but famously difficult to quantify. Many experts
have developed tools to analyze this asset, but there is no universally accepted way
to measure it. As one of the serial challenges that marketing professionals and
academics find with the concept of brand value, the difference between
quantitative and qualitative equity values is difficult to reconcile. Quantitative brand
value includes numerical values such as profit margins and market share, but fails to
capture qualitative elements such as prestige and associations of interest. Overall,
most marketing practitioners take a more qualitative approach to brand value
because of this challenge. In a survey of nearly 200 senior marketing managers, only
26 percent responded that they found the "brand value" metric very useful.

PURPOSE:
The purpose of brand value metrics is to measure the equity of a brand. A brand
encompasses the name, logo, image, and perceptions that identify a product, service,
or provider in the minds of customers. It takes shape in advertising, packaging, and
other marketing communications, and becomes a focus of the relationship with
consumers. In time, a brand comes to embody a promise about the goods it
identifies—a promise about quality, performance, or other dimensions of value,
which can influence consumers' choices among competing products. When
consumers trust a brand and find it relevant, they may select the offerings
associated with that brand over those of competitors, even at a premium price.
When a brand's promise extends beyond a particular product, its owner may
leverage it to enter new markets. For all these reasons, a brand can hold
tremendous value, which is known as brand value.
Brand value is best managed with the development of Brand value Goals, which are
then used to track progress and performance.

Construction:
There are many ways to measure a brand. Some measurements approaches are at
the firm level, some at the product level, and still others are at the consumer level.
Firm Level: Firm level approaches measure the brand as a financial asset. In short, a
calculation is made regarding how much the brand is worth as an intangible asset.
For example, if you were to take the value of the firm, as derived by its market

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capitalization—and then subtract tangible assets and "measurable" intangible assets
—the residual would be the brand value. One high-profile firm level approach is by
the consulting firm Interbrand. To do its calculation, Interbrand estimates brand
value on the basis of projected profits discounted to a present value. The discount
rate is a subjective rate determined by Interbrand and Wall Street equity specialists
and reflects the risk profile, market leadership, stability and global reach of the
brand. Brand valuation modeling is closely related to brand value, and a number of
models and approaches have been developed by different consultancies. Brand
valuation models typically combine a brand value measure (e.g.: the proportion of
sales contributed by "brand") with commercial metrics such as margin or economic
profit.
Product Level: The classic product level brand measurement example is to compare
the price of a no-name or private label product to an "equivalent" branded product.
The difference in price, assuming all things equal, is due to the brand. More recently
a revenue premium approach has been advocated. Marketing mix modeling can
isolate "base" and "incremental" sales, and it is sometimes argued that base sales
approximate to a measure of brand value. More sophisticated marketing mix models
have a floating base that can capture changes in underlying brand value for a
product over time.
Consumer Level: This approach seeks to map the mind of the consumer to find out
what associations with the brand the consumer has. This approach seeks to measure
the awareness (recall and recognition) and brand image (the overall associations
that the brand has). Free association tests and projective techniques are commonly
used to uncover the tangible and intangible attributes, attitudes, and intentions
about a brand. Brands with high levels of awareness and strong, favorable and
unique associations are high equity brands.
All of these calculations are, at best, approximations. A more complete
understanding of the brand can occur if multiple measures are used.
Positive brand value vs. negative brand value
Brand value is the positive effect of the brand on the difference between the prices
that the consumer accepts to pay when the brand known compared to the value of
the benefit received.
There are two schools of thought regarding the existence of negative brand value.
One perspective states brand value cannot be negative, hypothesizing only positive
brand value is created by marketing activities such as advertising, PR, and
promotion. A second perspective is that negative equity can exist, due to
catastrophic events to the brand, such as a wide product recall or continued
negative press attention (Blackwater or Halliburton, for example).

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Colloquially, the term "negative brand value" may be used to describe a product or
service where a brand has a negligible effect on a product level when compared to a
no-name or private label product.
Family branding vs. individual branding strategies
The greater a company's brand value, the greater the probability that the company
will use a family branding strategy rather than an individual branding strategy. This
is because family branding allows them to leverage the equity accumulated in the
core brand. Aspects of brand value include: brand loyalty, awareness,
association and perception of quality.
Examples
In the early 2000s in North America, the Ford Motor Company made a strategic
decision to brand all new or redesigned cars with names starting with "F." This
aligned with the previous tradition of naming all sport utility vehicles since the Ford
Explorer with the letter "E." The Toronto Star quoted an analyst who warned that
changing the name of the well-known Windstar to the Freestar would cause
confusion and discard brand value built up, while a marketing manager believed
that a name change would highlight the new redesign. The aging Taurus, which
became one of the most significant cars in American auto history, would be
abandoned in favor of three entirely new names, all starting with "F," the Five
Hundred, Freestar, and Fusion. By 2007, the Freestar was discontinued without a
replacement. The Five Hundred name was thrown out and Taurus was brought back
for the next generation of that car in a surprise move by Alan Mulally.
In practice, brand value is difficult to measure. Because brands are crucial assets,
however, both marketers and academic researchers have devised means to
contemplate their value. Some of these techniques are described below.

Methodology
Brand value Ten (Aaker)
David Aaker, a marketing professor and brand consultant, highlights ten attributes
of a brand that can be used to assess its strength. These include Differentiation,
Satisfaction or Loyalty, Perceived Quality, Leadership or Popularity, Perceived
Value, Brand Personality, Organizational Associations, Brand Awareness, Market
Share, and Market Price and Distribution Coverage. Aaker doesn't weight the

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attributes or combine them in an overall score, as he believes any weighting would
be arbitrary and would vary among brands and categories. Rather he recommends
tracking each attribute separately.
Brand value Index (Moran)
Marketing executive Bill Moran has derived an index of brand value as the product
of three factors:

 Effective Market Share is a weighted average. It represents the sum of a

brand's market shares in all segments in which it competes, weighted by each
segment's proportion of that brand's total sales.
 Relative Price is a ratio. It represents the price of goods sold under a given
brand, divided by the average price of comparable goods in the market.
 Durability is a measure of customer retention or loyalty. It represents the
percentage of a brand's customers who will continue to buy goods under that
brand in the following year.

Brand Asset Valuator (Young & Rubicam)

Young & Rubicam, a marketing communications agency, have developed the Brand
Asset Valuator, BAV, a tool to diagnose the power and value of a brand. In using it,
the agency surveys consumers' perspectives along four dimensions:

 Differentiation: The defining characteristics of the brand and its

distinctiveness relative to competitors.
 Relevance: The appropriateness and connection of the brand to a given
consumer.
 Esteem: Consumers' respect for and attraction to the brand.
 Knowledge: Consumers' awareness of the brand and understanding of what it
represents.

Brand Valuation Model (Inter brand and Brand Finance)

 Inter brand, a brand strategy agency, draws upon financial results and
projections in its own model for brand valuation. It reviews a company's
financial statements, analyzes its market dynamics and the role of brand in
income generation, and separates those earnings attributable to tangible assets
(capital, product, packaging, and so on) from the residual that can be ascribed to
a brand. It then forecasts future earnings and discounts these on the basis of

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 brand strength and risk. The agency estimates brand value on this basis and
tabulates a yearly list of the 100 most valuable global brands.
 The Royalty Relief approach of Brand Finance, an independent brand
valuation consultancy, is based on the assumption that if a company did not own
the trademarks that it exploits, it would need to license them from a third party
brand owner instead. Ownership therefore ‘relieves’ the company from paying a
license fee (the royalty) for the use of the third party trademarks. The royalty
relief method involves estimating likely future sales, applying an appropriate
royalty rate to them and then discounting estimated future, post-tax royalties, to
arrive at a Net Present Value (NPV). This is held to represent the brand value.
[15]
 The independent consultancy publishes yearly lists by industry sector and
geographic region as well as a top 500 global list.

Brand Contribution to Market Cap Method (Core Brand)

Core Brand—a research, brand strategy, communication, and design firm—utilizes
the Brand Contribution to Market Cap method using the Corporate Branding Index®
database composed of Familiarity and Favorability data as the quantitative basis of
its system.
Familiarity and Favorability scores are analyzed in the context of a company’s size
in market cap and revenue to determine a base expected level of Familiarity and
Favorability for the brand’s value to be zero. Utilizing a statistical regression
analysis of the factors driving the cash flow multiple and thus share price, the
variance in Familiarity and Favorability above or below the base expected level is
analyzed.
As a point in time analysis, this method is used for brand value valuation of a
company based on its current Familiarity and Favorability, Revenue and Market
Cap. The output of the analysis provides the end user with two pieces of data:

1. The percentage of market cap that is attributable directly to its corporate

brand (i.e., how hard the brand is working to create value for the company);
2. The dollar value of the brand at a point in time, this is the asset value of the
brand as a component of the company’s market valuation.
According to this analysis, the corporate brand is responsible for 5-7% of stock
performance on average.
Conjoint Analysis
Marketers use conjoint analysis to measure consumers' preference for various
attributes of a product, service, or provider, such as features, design, price, or
location. By including brand and price as two of the attributes under consideration,

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they can gain insight into consumers' valuation of a brand—that is, their willingness
to pay a premium for it.

Brand Value’s OR Brand Equity’s

Main 5 factors

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 QUESTIONNAIRE
DESIGN

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Questionnaires are an inexpensive way to gather data from a potentially
large number of respondents. Often they are the only feasible way to reach
a number of reviewers large enough to allow statistically analysis of the
results. A well-designed questionnaire that is used effectively can gather
information on both the overall performance of the test system as well as
information on specific components of the system. If the questionnaire
includes demographic questions on the participants, they can be used to
correlate performance and satisfaction with the test system among different
groups of users.
The steps required to design and administer a questionnaire include:

1. Defining the Objectives of the survey

2. Determining the Sampling Group
3. Writing the Questionnaire
4. Administering the Questionnaire
5. Interpretation of the Results

Before these steps are examined in detail, it is good to consider what

questionnaires are good at measuring and when it is appropriate to use
questionnaires.

What can questionnaires measure?

Questionnaires are quite flexible in what they can measure, however they
are not equally suited to measuring all types of data. We can classify data in
two ways, Subjective vs. Objective and Quantitative vs. Qualitative. When a
questionnaire is administered, the researchers control over the environment

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will be somewhat limited. This is why questionnaires are inexpensive to
administer. This loss of control means the validity of the results are more
reliant on the honesty of the respondent. Consequently, it is more difficult to
claim complete objectivity with questionnaire data then with results of a
tightly controlled lab test. In general, questionnaires are better suited to
gathering reliable subjective measures, such as user satisfaction, of the
system or interface in question.
Questions may be designed to gather either qualitative or quantitative data.
By their very nature, quantitative questions are more exact then qualitative.
Any question must be carefully crafted, but in particular questions that
assess a qualitative measure must be phrased to avoid ambiguity.
Qualitative questions may also require more thought on the part of the
participant and may cause them to become bored with the questionnaire
sooner. In general, we can say that questionnaires can measure both
qualitative and quantitative data well, but that qualitative questions require
more care in design, administration, and interpretation.

When to use a questionnaire?

There is no all encompassing rule for when to use a questionnaire. The

choice will be made based on a variety of factors including the type of
information to be gathered and the available resources for the
experiment.

I. Defining the Objectives of the Survey

The importance of well-defined objectives cannot be over emphasized. A
questionnaire that is written without a clear goal and purpose is inevitably
going to overlook important issues and waste participants' time by asking
useless questions. The questionnaire may lack a logical flow and thereby

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cause the participant to lose interest. Consequential, what useful data you
may have collected could be further compromised. The problems of a poorly
defined questionnaire do not end here, but continue on to the analysis stage.
It is difficult to imagine identifying a problem and its cause. In other words,
how would it be possible to reach insightful conclusions if one didn't actually
know what they had been looking for or planning to observe.
A good rule of thumb is that if you are finding it difficult to write the
questions, then you haven't spent enough time defining the objectives of the
questionnaire. Go back and do this step again. The questions should follow
quite naturally from the objectives.

II. Writing the Questionnaire

If the preceding steps have been faithfully executed, most of the questions
will be on obvious topics. Most questionnaires, however, also gather
demographic data on the participants. This is used to correlate response sets
between different groups of people. It is important to see whether responses
are consistent across groups. For example, if one group of participants is
noticeably less satisfied with the test interface, it is likely that the interface
was designed without fair consideration of this group's specific needs. This
may signify the need for fundamental redesign of the interface. In addition,
certain questions simply may only be applicable to certain kinds of users.
Typically, demographic data is collected at the beginning of the
questionnaire, but such questions could be located anywhere or even
scattered throughout the questionnaire. One obvious argument in favor of
the beginning of the questionnaire is that normally background questions are
easier to answer and can ease the respondent into the questionnaire.

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It is important to ask only those background questions that are necessary.
Do not ask income of the respondent unless there is at least some rational
for suspecting a variance across income levels. There is often only a fine line
between background and personal information. You do not want to cross
over in to the personal realm unless absolutely necessary.

Questionnaire Research Flow Chart

Questionnaire research design proceeds in an orderly and specific manner.
Each item in the flow chart depends upon the successful completion of all the
previous items. Therefore, it is important not to skip a single step. Notice
that there are two feedback loops in the flow chart to allow revisions to the
methodology and instruments.

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 Advantages of Written Questionnaires

 Questionnaires are very cost effective when compared to face-to-face

interviews. This is especially true for studies involving large sample
sizes and large geographic areas. Written questionnaires become even

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 more cost effective as the number of research questions increases.

 Questionnaires are easy to analyze. Data entry and tabulation for

nearly all surveys can be easily done with many computer software
packages.

 Questionnaires are familiar to most people. Nearly everyone has had

some experience completing questionnaires and they generally do not
make people apprehensive.

 Questionnaires reduce bias. There is uniform question presentation

and no middle-man bias. The researcher's own opinions will not
influence the respondent to answer questions in a certain manner.
There are no verbal or visual clues to influence the respondent.

 Questionnaires are less intrusive than telephone or face-to-face

surveys. When a respondent receives a questionnaire in the mail, he is
free to complete the questionnaire on his own time-table. Unlike other
research methods, the respondent is not interrupted by the research
instrument.

Disadvantages of Written Questionnaires

One major disadvantage of written questionnaires is the possibility of low

response rates. Low response is the curse of statistical analysis. It can
dramatically lower our confidence in the results. Response rates vary widely
from one questionnaire to another (10% - 90%), however, well-designed
studies consistently produce high response rates.
Another disadvantage of questionnaires is the inability to probe responses.

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Questionnaires are structured instruments. They allow little flexibility to the
respondent with respect to response format. In essence, they often lose the
"flavor of the response" (i.e., respondents often want to qualify their
answers). By allowing frequent space for comments, the researcher can
partially overcome this disadvantage. Nearly ninety percent of all
communication is visual. Gestures and other visual cues are not available
with written questionnaires. The lack of personal contact will have different
effects depending on the type of information being requested. A
questionnaire requesting factual information will probably not be affected by
the lack of personal contact. A questionnaire probing sensitive issues or
attitudes may be severely affected.
When returned questionnaires arrive in the mail, it's natural to assume that
the respondent is the same person you sent the questionnaire to. This may
not actually be the case. Many times business questionnaires get handed to
other employees for completion. Housewives sometimes respond for their
husbands. Kids respond as a prank. For a variety of reasons, the respondent
may not be who you think it is. It is a confounding error inherent in
questionnaires.
Finally, questionnaires are simply not suited for some people. For example, a
written survey to a group of poorly educated people might not work because
of reading skill problems. More frequently, people are turned off by written
questionnaires because of misuse.

Questionnaire Design - General Considerations

Most problems with questionnaire analysis can be traced back to the design
phase of the project. Well-defined goals are the best way to assure a good
questionnaire design. When the goals of a study can be expressed in a few
clear and concise sentences, the design of the questionnaire becomes
considerably easier. The questionnaire is developed to directly address the

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goals of the study.
One of the best ways to clarify your study goals is to decide how you intend
to use the information. Does this before you begin designing the study. This
sounds obvious, but many researchers neglect this task. Why do research if
the results will not be used?
 Be sure to commit the study goals to writing .
 Formulate a plan for doing the statistical analysis during the
design stage of the project.
 Make the envelope unique.
 Provide a well-written cover letter.
 Give your questionnaire a title that is short and meaningful to
the respondent.
 Include clear and concise instructions on how to complete the
questionnaire.
 Use simple and direct language.
 Leave adequate space for respondents to make comments.
 Place the most important items in the first half of the
questionnaire.
 Hold the respondent's interest.
 Provide incentives as a motivation for a properly completed
questionnaire.
Use professional production methods for the questionnaire.

FACTOR ANALYSIS
Factor analysis is an interdependence technique in that an entire set of
interdependent relationships is examined.
Mathematically, factor analysis is somewhat similar to multiple regression
analysis, in that each variable is expressed as a linear combination of underlining
factors. The amount variance a variable shares with all other variables included in
the analysis is referred to as communality. The co variation among the variables is

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described in terms of small number of common factor plus a unique factor for each
variable. If the variables are standardized, the factor model may be represented as:

Xi = Ai1F1 + Ai2F2 + Ai3F3 + … + AimFm + ViUi

Where

Xi = ith standardized variable

Aij = standardized multiple regression coefficient of variable I on common factor j

F= common factor

Vi = standardized regression coefficient of variable I on unique factor I

Ui = the unique factor for variable i

m = number of common factors

The unique factors are uncorrelated with each other and with the common factors.
The common factors themselves can be expressed as linear combinations of the
observed variables.

Fi = Wi1x1 + Wi2X2 + Wi3X3 + … + WikXk

Where

Fi = estimate of ith factor

Wi = weight or factor score coefficient

k = number of variables

Key Concepts and Terms

Exploratory factor analysis (EFA) seeks to uncover the underlying structure of a
relatively large set of variables. The researcher's à priori assumption is that any
indicator may be associated with any factor. This is the most common form of factor
analysis. There is no prior theory and one uses factor loadings to intuit the factor
structure of the data.

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Confirmatory factor analysis (CFA) seeks to determine if the number of factors
and the loadings of measured (indicator) variables on them conform to what is
expected on the basis of pre-established theory. Indicator variables are selected on
the basis of prior theory and factor analysis is used to see if they load as predicted
on the expected number of factors. The researcher's à priori assumption is that each
factor (the number and labels of which may be specified à priori ) is associated with
a specified subset of indicator variables. A
minimum requirement of confirmatory factor analysis is that one hypothesize
beforehand the number of factors in the model, but usually also expectations about
which variables will load on which factors (Kim and Mueller, 1978b: 55).

Factors and components: Both are the dimensions (or latent variables) identified
with clusters of variables, as computed using factor analysis. Technically speaking,
factors (as from PFA -- principal factor analysis, a.k.a. principal axis factoring, a.k.a.
common factor analysis) represent the common variance of variables, excluding
unique variance, and is thus a correlation-focused approach seeking to reproduce
the intercorrelation among the variables. By comparison, components (from PCA -
principal components analysis) reflect both common and unique variance of the
variables and may be seen as a variance-focused approach seeking to reproduce
both the total variable variance with all components and to reproduce the
correlations. PCA is far more common than PFA, however, and it is common to use
"factors" interchangeably with "components."

* Factor loadings: The factor loadings, also called component loadings in PCA, are
the correlation coefficients between the variables (rows) and factors (columns).
Analogous to Pearson's r, the squared factor loading is the percent of variance in
that variable explained by the factor. To get the percent of variance in all the
variables accounted for by each factor, add the sum of the squared factor loadings
for that factor (column) and divide by the number of variables. (Note the number of
variables equals the sum of their variances as the variance of a standardized
variable is 1.) This is the same as dividing the factor's eigenvalue by the number of
variables.

In SPSS, the factor loadings are found in a matrix labeled Factor Matrix if PFA is
requested, or in one labeled Component Matrix if PCA is requested, or one labeled
Pattern Matrix if an oblique rotation is requested.

The sum of the squared factor loadings for all factors for a given variable (row) is
the variance in that variable accounted for by all the factors, and this is called the
communality. In a complete PCA, with no factors dropped, this will be 1.0, or 100%
of the variance. The ratio of the squared factor loadings for a given variable (row in

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the factor matrix) shows the relative importance of the different factors in
explaining the variance of the given variable. Factor loadings are the basis for
imputing a label to the different factors.

* Communality, h2, is the squared multiple correlation for the variable using the
factors as predictors. The communality measures the percent of variance in a given
variable explained by all the factors jointly and may be interpreted as the reliability
of the indicator.

When an indicator variable has a low communality, the factor model is not working
well for that indicator and possibly it should be removed from the model. However,
communalities must be interpreted in relation to the interpretability of the factors.
A communality of .75 seems high but is meaningless unless the factor on which the
variable is loaded is interpretable, though it usually will be. A communality of .25
seems low but may be meaningful if the item is contributing to a well-defined factor.
That is, what is critical is not the communality coefficient per se, but rather the
extent to which the item plays a role in the interpretation of the factor, though often
this role is greater when communality is high.

Communality for a variable is computed as the sum of squared factor loadings for
that variable (row). Recall r-squared is the percent of variance explained, and since
factors are uncorrelated, the squared loadings may be added to get the total percent
explained, which is what communality is. For full orthogonal PCA, the communality
will be 1.0 for all variables and all of the variance in the variables will be explained
by all of the factors, which will be as many as there are variables. In the
communalities chart, SPSS labels this column the "initial" communalities. The
"extracted" communality is the percent of variance in a given variable explained by
the factors which are extracted, which will usually be fewer than all the possible
factors, resulting in coefficients less than 1.0. For PFA, however, the communalities
for the various factors will be less than 1 even initially. Communality does not
change when rotation is carried out, hence in SPSS there is only one communalities
table.

* Eigenvalues: Also called characteristic roots . The eigenvalue for a given factor
measures the variance in all the variables which is accounted for by that factor. The
ratio of eigenvalues is the ratio of explanatory importance of the factors with
respect to the variables. If a factor has a low eigenvalue, then it is contributing little
to the explanation of variances in the variables and may be ignored as redundant
with more important factors.

Thus, eigenvalues measure the amount of variation in the total sample accounted for

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by each factor. Note that the eigenvalue is not the percent of variance explained but
rather a measure of "amount," used for comparison with other eigenvalues. A
factor's eigenvalue may be computed as the sum of its squared factor loadings for all
the variables. Note that the eigenvalues associated with the unrotated and rotated
solution will differ, though their total will be the same.

* Trace is the sum of variances for all factors, which is equal to the number of
variables since the variance of a standardized variable is 1.0. A factor's eigenvalue
divided by the trace is the percent of variance it explains in all the variables, usually
labeled percent of trace in computer output. Computer output usually lists the
factors in descending order of eigenvalue, along with a cumulative percent of trace
for as many factors as are extracted.

* Factor scores: Also called component scores in PCA, factor scores are the scores
of each case (row) on each factor (column). To compute the factor score for a given
case for a given factor, one takes the case's standardized score on each variable,
multiplies by the corresponding factor loading of the variable for the given factor,
and sums these products. The SPSS FACTOR procedure saves standardized factor
scores as variables in your working data file. By default it will name them
FAC1_1,FAC2_1, FAC3_1, etc., for the corresponding factors (factor 1, 2 and 3) of
analysis 1; and FAC1_2, FAC2_2, FAC3_2 for a second set of factor scores, if any,
within the same procedure, and so on. Although SPSS adds these variables to the
right of your working data set automatically, they will be lost when you close the
dataset unless you re-save your data.

* Kaiser criterion: A common rule of thumb for dropping the least important
factors from the analysis. The Kaiser rule is to drop all components with eigenvalues
under 1.0. Kaiser criterion is the default in most computer programs.

* Scree plot: The Cattell scree test plots the components as the X axis and the
corresponding eigenvalues as the Y axis. As one moves to the right, toward later
components, the eigenvalues drop. When the drop ceases and the curve makes an
elbow toward less steep decline, Cattell's scree test says to drop all further
components after the one starting the elbow. Scree plot example.

* Variance explained criteria: Some researchers simply use the rule of keeping
enough factors to account for 90% (sometimes 80%) of the variation.

* Rotation Methods. Rotation serves to make the output more understandable and
is usually necessary to facilitate the interpretation of factors. The sum of eigenvalues

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is not affected by rotation, but rotation will alter the eigenvalues of particular
factors.

* No rotation is the default in SPSS, but it is a good idea to select a rotation method,
usually varimax. The original, unrotated principal components solution maximizes
the sum of squared factor loadings, efficiently creating a set of factors which explain
as much of the variance in the original variables as possible. The amount explained
is reflected in the sum of the eigenvalues of all factors. However, unrotated solutions
are hard to interpret because variables tend to load on multiple factors.

* Varimax rotation is an orthogonal rotation of the factor axes to maximize the

variance of the squared loadings of a factor (column) on all the variables (rows) in a
factor matrix, which has the effect of differentiating the original variables by
extracted factor. That is, it minimizes the number of variables which have high
loadings on any one given factor. Each factor will tend to have either large or small
loadings of particular variables on it. A varimax solution yields results which make it
as easy as possible to identify each variable with a single factor. This is the most
common rotation option.

* Quartimax rotation is an orthogonal alternative which minimizes the number of

factors needed to explain each variable.

* Equimax rotation is a compromise between Varimax and Quartimax criteria.

* Direct oblimin rotation is the standard method when one wishes a non-
orthogonal solution -- that is, one in which the factors are allowed to be correlated.
This will result in higher eigenvalues but diminished interpretability of the factors.
See below.

* Promax rotation is an alternative non-orthogonal rotation method which is

computationally faster than the direct oblimin method and therefore is sometimes
used for very large datasets.

Steps in
Conducting Factor Analysis

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 Formulate the problem.
↓
Construct the correlation matrix.
↓
Determine the method of factor analysis.
↓
Determine the number of factors.
↓
Rotate the factors.
↓

Interpret the factors Variables

↓

Calculate the Select the

Factor scores Surrogate

.
↓
Determine the model fit

RESEARCH OBJECTIVE &

METHODOOGY

I. OBJECTIVE OF THE STUDY

The main objective of this study is as follow:

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“Brand Value of Shakti Bhog for Basmati Rice”

II. METHODOLOGY

The methodology adopted for collecting data and sample design is given below:

A. COLLECTION OF DATA

For collecting Primary Data from the users, a questionnaire was

designed.
This questionnaire was administered to the consumers who use mobil
services. Then a pilot survey was conducted to check the validity of the
survey. Sample questionnaire is attached in annexure.

B. SIMPLE RANDOM SAMPLING DESIGN

SAMPLE SIZE : 251

SURVEY AREA : Delhi/NCR

MODE OF SURVEY : INTERVIEW

C. STATISTICAL INTERPRETATION AND ANALYSIS

The data obtained from primary survey was analyzed using tools like SPSS and Excel
etc.

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Demographic Information:

Gender:

Gender Observations
Male 139
Female 112
Grand Total 251

67 | P a g e
 Gender
Male Female

45%

55%

Out of the 251 respondents surveyed, 55% are males and

45% are females.

Age:
Age Observations
Below 18 years 14
18-27 years 86
28-37 years 67
38-47 years 52
Above 47 years 32
Total 251

68 | P a g e
 Age
Below 18 years 18-27 years 28-37 years 38-47 years Above 47 years
13% 6%

21% 34%

27%

Out of the 251 respondents being surveyed, 5 % of the population belongs to <18
years age group. The number of respondents belonging to 18-27 years age group
is 34 %, 28-37 years age group is 27 %, 38-47 years age group is 21% and >47
years age group is 13 %.

Area of Residence:
Area of
Residenc
e Observations
North Delhi 59
South Delhi 63
West Delhi 48
East Delhi 47
Central Delhi 34
Total 251

69 | P a g e
 Area of Residence
North Delhi South Delhi West Delhi East Delhi Central Delhi
14% 24%

19%

25%
19%

Out of the 251 respondents surveyed, 23% are belongs to North Delhi, the no.
of respondents belongs to South Delhi are 25%, no. of respondents belongs to
West Delhi are 19%, no. of respondents belongs to East Delhi are 19% and
no. of respondents belongs to Central Delhi are 14%.

Occupation:
Occupation Observations
Student 63
Service 59
Professional 35
Business 37
Homemaker 56
Others 1

70 | P a g e
 Occupation
Others Student
Homemaker 0% 25%
22%

Business
15%
Professional
14% Service
24%

Out of the 251 respondents surveyed, mostly i.e. 25% are students followed
by Service constituting 24% of the sample, 22% are Homemaker. The no. of
respondents who are in Business is 15% & 14% are professionals.

Education:
Education Observations
Up to HSC 45
Graduates 83
Post Graduates 100
Others 23

71 | P a g e
 Education
Others Upto HSC
9% 18%

Post Gradutes
40%

Graduates
33%

No. of respondents 40% are post graduate,33% are graduate, 18%

are up to HSC and 9% are belongs to others.

Household Income (Monthly):

Household
Income Observations
Rs.10000-20000 19
Rs.20000-30000 50
Rs.30000-40000 98
Rs.40000 & above 84

72 | P a g e
 Household Income (Monthly)
Rs.10000-20000
8%
Rs.40000 & above Rs.20000-30000
33% 20%

Rs.30000-40000
39%

People having monthly income of Rs.10000-20000 are 8%, 20% people have
their monthly income Rs.20000-30000, 39% people have their monthly
income Rs.30000-40000 and above Rs.40000 are 33%. Thus we can say that
the purchasing power of the respondents is good.

Marital Status:

Marital Status Observations

Married 146
Unmarried 100
Others 5

73 | P a g e
 Marital Status
Others
2%

Unmarried
40%

Married
58%

Out of 251 respondents 58% are married, the no. of unmarried

respondents are 40% and 2% are others. (Others include divorced,
widow etc.).

No. of person/s who is/are living with you:

No. of person/s who is/are

living with you Observations
1 25
2 41
3 77
4 64
More Then 4 43

74 | P a g e
 No. of person/s who is/are living with you
1
More Then 4 10% 2
17% 16%

4
26%

3
31%

Out of 251 respondents, 1 person is living with respondents are 10%,

2persons are living with respondents are 16%, 31% respondents are
living with 3 persons, 4 persons are living with respondents are 26%,
17% respondents are living with more than 4 persons.

Brands You Aware About (you can choose multiple

options also):
Brands you aware
about? Observations
Best Basmati Rice 102
Kohinoor Basmati Rice 217
India Gate Basmati rice 230
Lal Qilla Basmati Rice 189

75 | P a g e
Shakti Bhog Basmati Rice 211
Dawat Basmati Rice 125
Dunar Basmati Rice 68
Doon Basmati Rice 43
Saffola Basmati Rice 68
Tirupati Basmati Rice 39
Others 2

250 230
217 211
189
200

150 125
102
100 68 68
43 39
50
2
0

Observations

When we have ask for awareness about Brands of Basmati Rice,most of

respondets are aware about India Gate,Shakti Bhog & Kohinoor. So Shakti
Bhog have a good market.

Q.1: Do you use basmati rice?

Yes 215
No 36

76 | P a g e
 Do you use basmati rice?
No
14%

Yes
86%

Out of 251 respondents, 86% are using Basmati Rice while 14% are
not.

Q.2: Which brand you like to purchase for basmati

rice?
Best Basmati Rice 12
Kohinoor Basmati Rice 38
India Gate Basmati rice 66
Lal Qilla Basmati Rice 7
Shakti Bhog Basmati Rice 45
Dawat Basmati Rice 11

77 | P a g e
Dunar Basmati Rice 11
Doon Basmati Rice 10
Saffola Basmati Rice 10
Tirupati Basmati Rice 4
Others 3

66
70
60
50 45
38
40
30
20 12 11 11 10 10
7
10 4 3

observations

Respondents are mostly preferred India Gate for Basmati Rice, it is on

1st position, while Shakti Bhog is on 2nd position and Kohinoor is on
3rd position for Basmati Rice.

Q.3: From how many years you are using above

mentioned brand?

Years observations
1 year 26
2 years 64
3 years 56
4 years 36

78 | P a g e
More than 4 years 35

Years of using above mentioned brand

1 year
More then 4 years 12%
16%

4 years
17%
2 yeasrs
29%

3 years
26%

Mostly respondents are loyal for their respective brands since 2

years. It has weightage of 29%.

Q.4: Approximately quantity of basmati rice

consume per month (in kg.)?

Quantity Observations
1 kg. 12
2 kg. 35
3 kg. 32
4 kg. 24
5 kg. 90

79 | P a g e
More Than 5
kg. 24

Consumption (in kg.)

2 kg.
More Than 5 kg. 1 kg. 16%
11% 6%

3 kg.
15%
5 kg.
41%
4 kg.
11%

Mostly respondents have consumption of 5 kg. for basmati rice it has

weightage of 41% then 2kg. which has weightage of 16%

Q.5: Size of the basmati rice packet you prefer to

buy (in kg.)?

Size Observations
1 kg. 29
2 kg. 12
5 kg. 165
10 kg. 9

80 | P a g e
Others 2

Size of the basmati rice packet

1 kg. 2 kg. 5 kg. 10 kg. Others

4% 1% 13% 6%

76%

76% of respondents are preferred for 5 kg. packet for basmati rice.

Q.6: Which Channel do you prefer to purchase

basmati rice (you can choose multiple options
also)?

Channel Observations
Local Kirana shops 147
Retail stores (like big apple, big
bazar etc.) 154
General Stores 134

81 | P a g e
Others 27

147 154
134
160
120
80
27
40
0

Observations

Respondents are preferred mostly Retail Stores for buying basmati

rice while Local Kirana Shops are on 2nd position.

Q.7 (a): On a scale of 1-5, rate the importance of

the following attributes you consider while
purchasing basmati rice [Brand name].

Weights Observations
Not Important 7
Less Important 17
Important 56
Very Important 87

82 | P a g e
Extremely
Important 48

87
90

80

70
56
60 48
50

40

30
17
20
7
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Brand Name is Very Important

for buying Basmati Rice.

Q.7 (b): On a scale of 1-5, rate the importance of

the following attributes you consider while
purchasing basmati rice [Advertisement].

Weights Observations
Not Important 23
Less Important 60
Important 84

83 | P a g e
Very Important 40
Extremely
Important 8

84
90

80

70 60

60

50 40

40
23
30

20 8
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

In respondents (mostly) point of view Advertisement is Important for

buying Basmati Rice.

Q.7 (c): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Price].

Weights Observations
Not Important 1
Less Important 13
Important 54
Very Important 100
Extremely 47

84 | P a g e
Important

100

100
90
80
70
54
60 47
50
40
30
13
20
1
10
0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Price is Very Important while purchasing

Basmati Rice.

Q.7 (d): [On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Quality].

Weights Observations
Not Important 2
Less Important 3
Important 25
Very Important 100

85 | P a g e
Extremely
Important 85

100

100
85
90
80
70
60
50
40
25
30
20
2 3
10
0
Not Important Less Important Important Very Important Extremely Important

Observations

Mostly respondents thought that Quality is Very Important while purchasing

basmati rice.

Q.7 (e): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Packaging].

Weights Observations
Not Important 9
Less Important 22
Important 88

86 | P a g e
Very Important 79
Extremely
Important 17

88
90 79

80

70

60

50

40
22
30 17
20 9

10

0
Not Important Less Important Important Very Important Extremely Important

Observations

Packaging is also Important according to mostly respondents.

Q.7 (f): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Taste].

Weights Observations
Not Important 1
Less Important 7
Important 38
Very Important 79
Extremely 89

87 | P a g e
Important

89

90 79

80

70

60

50 38
40

30

20
7
10 1

0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Taste of basmati rice is Extremely

Important when they think to buy it.

Q.7 (g): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Discount (offer)].

Weights Observations
Not Important 6
Less Important 24
Important 85
Very Important 86
Extremely 15

88 | P a g e
Important

85 86
90

80

70

60

50

40
24
30
15
20
6
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

Discounts (offer) also is Very Important according to mostly respondents

who consume basmati rice.

Q.7 (h): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Promotion].

Weights Observations
Not Important 19
Less Important 35
Important 93
Very Important 60
Extremely 7

89 | P a g e
Important

93
100
90
80
70 60

60
50
35
40
30 19

20 7
10
0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Promotion is Important to increase the sell

of basmati rice.

Q.7 (i): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Uniqueness].

Weights Observations
Not Important 14
Less Important 48
Important 72
Very Important 65
Extremely 15

90 | P a g e
Important

80 72
65
70

60
48
50

40

30
14 15
20

10

0
Not Important Less Important Important Very Important Extremely Important

Observations

In respondents (mostly) point of view Uniqueness is Important for buying

Basmati Rice.

Q.7 (j): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Recommendation].

Weights Observations
Not Important 15
Less Important 36
Important 87
Very Important 65
Extremely 11

91 | P a g e
Important

87
90

80
65
70

60

50
36
40

30
15
20 11

10

0
Not Important Less Important Important Very Important Extremely Important

Observations

Recommendation is also Important according to mostly respondents.

Q.7 (k): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Availability].

Weights Observations
Not Important 8
Less Important 25
Important 80
Very Important 87
Extremely 15

92 | P a g e
Important

87
90 80

80

70

60

50

40
25
30
15
20 8
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

Availability of basmati rice is Very Important according to mostly

respondents.

Q.7 (l): On a scale of 1-5, rate the importance of the following

attributes you consider while purchasing basmati rice
[Health Benefits].

Weights Observations
Not Important 5
Less Important 15
Important 61
Very Important 90

93 | P a g e
Extremely
Important 44

90

90

80

70 61

60
44
50

40

30
15
20
5
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

Getting Health Benefits from basmati rice is Very Important according to

mostly respondents.

Q.7 (m): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Product Expiry].

Weights Observations
Not Important 6
Less Important 11
Important 80
Very Important 86

94 | P a g e
Extremely
Important 31

86
90 80
80

70

60

50

40 31
30

20 11
6
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Product Expiry is Very Important while

purchasing basmati rice.

Q.7 (n): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Size of the rice].

Weights Observations
Not Important 5
Less Important 24
Important 85
Very Important 79

95 | P a g e
Extremely
Important 17

85
90
79
80

70

60

50

40

30 24
17
20
5
10

0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Size of the Rice is Important for buying

basmati rice.

Q.7 (o): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Thickness of the rice].

Weights Observations
Not Important 5
Less Important 29
Important 76
Very Important 87

96 | P a g e
Extremely
Important 16

90
80 87
76
70
60
50
40
29
30
20 5
10
0 16

Observations

Thickness of rice is Very Important according to mostly respondents while

purchasing basmati rice.

Q.7 (p): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Cooking Time].

Weights Observations
Not Important 10
Less Important 17
Important 92

97 | P a g e
Very Important 77
Extremely
Important 17

100 92

90
77
80
70
60
50
40
30
17 17
20 10
10
0
Not Important Less Important Important Very Important Extremely Important

Observations

According to mostly respondents Cooking Time of basmati rice is Important

to buy it.

Q.7 (q): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Aroma (fragrance) of cooked rice].

Weights Observations
Not Important 4
Less Important 26
Important 86

98 | P a g e
Very Important 85
Extremely
Important 12

90 86
80 85
70
60
50
40
30 26
20
4
10
0 12

Observations

According to mostly respondents Aroma (fragrance) of cooked rice is

Important to buy basmati rice.

Q.7 (r): On a scale of 1-5, rate the importance of the

following attributes you consider while purchasing
basmati rice [Condition of cooked rice].

Weights Observations
Not Important 6
Less Important 8
Important 75

99 | P a g e
Very Important 105
Extremely
Important 19

120
105

100

75
80

60

40
19
20 8
6

0
Not Important Less Important Important Very Important Extremely Important

Observations

Condition of Cooked Rice is Very Important for buying basmati rice

according to mostly respondents.

Q.8: Did you ever use Shakti Bhog Basmati Rice?

Yes 93
No 124

100 | P a g e
 Chart Title

Yes
43%

No
57%

Out of 215 respondents who consume basmati rice 57% are already used
Shakti Bhog Basmati rice at least once till now.

Q.9: Why did you choose Shakti Bhog Basmati Rice (you
can choose multiple options also)?

Reason Observations
Recommendation 35
Price 33
Advertisement 41

101 | P a g e
Bored from previously
used brand 27
Brand Name 51
Quality 25
Packaging 9
Discount 14
Others 1

60 51
50 41
35 33
40
27 25
30
20 14
9
10 1
0

Observations

Mostly respondents used Shakti Bhog Basmati rice because of Brand Name.

QUESTION NO. 10

Interpretation and analysis -

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .817

Bartlett's Test of Sphericity Approx. Chi-Square 634.195

102 | P a g e
 Df 153

Sig. .000

In the following tables:

VAR00001 – Brand name

VAR00002 – Advertisement
VAR00003 – Price
VAR00004 – Quality
VAR00005 – Packaging
VAR00006 – Taste
VAR00007 – Discount (offer)
VAR00008 – Promotion
VAR00009 – Uniqueness
VAR00010 – Recommendation
VAR00011 – Availability
VAR00012 – Health Benefits
VAR00013 – Product Expiry
VAR00014 – Size of Rice
VAR00015 – Thickness of Rice
VAR00016– Cooking Time
VAR00017– Aroma (fragrance) of cooked Rice
VAR00018– Condition of Cooked Rice

Communalities

Initial Extraction

VAR00001 1.000 .701

VAR00002 1.000 .675
VAR00003 1.000 .652
VAR00004 1.000 .669
VAR00005 1.000 .687
VAR00006 1.000 .545

103 | P a g e
VAR00007 1.000 .595
VAR00008 1.000 .655
VAR00009 1.000 .805
VAR00010 1.000 .636
VAR00011 1.000 .630
VAR00012 1.000 .667
VAR00013 1.000 .492
VAR00014 1.000 .735
VAR00015 1.000 .697
VAR00016 1.000 .677
VAR00017 1.000 .684
VAR00018 1.000 .537

Extraction Method: Principal Component

Analysis.

Total Variance Explained

Extraction Sums of Squared

Initial Eigenvalues Loadings

Component Total % of Variance Cumulative % Total % of Variance

1 5.916 32.865 32.865 5.916 32.865

2 2.010 11.165 44.030 2.010 11.165
3 1.688 9.377 53.407 1.688 9.377

104 | P a g e
4 1.086 6.032 59.439 1.086 6.032
5 1.040 5.776 65.215 1.040 5.776
6 .835 4.638 69.853
7 .765 4.250 74.103
8 .739 4.107 78.210
9 .620 3.445 81.655
10 .561 3.115 84.770
11 .495 2.752 87.522
12 .469 2.607 90.129
13 .431 2.396 92.525
14 .335 1.862 94.387
15 .300 1.667 96.054
16 .271 1.504 97.558
17 .235 1.306 98.864
18 .204 1.136 100.000

Extraction Method: Principal Component Analysis.

105 | P a g e
106 | P a g e
 Component Matrixa

Component

1 2 3 4 5

VAR00001 .367 -.096 .329 .565 -.359

VAR00002 .449 -.078 .483 .120 .469
VAR00003 .457 -.151 -.372 .506 .163
VAR00004 .545 -.315 -.476 .205 -.067
VAR00005 .581 -.447 .230 -.160 .267
VAR00006 .682 .146 -.195 -.104 -.091
VAR00007 .687 -.147 .176 .248 -.092
VAR00008 .625 -.094 .501 -.072 -.005
VAR00009 .688 -.297 .313 -.269 -.271
VAR00010 .712 -.159 .196 -.038 -.253
VAR00011 .656 -.151 -.202 -.307 .207
VAR00012 .647 -.096 -.414 .039 .257
VAR00013 .536 -.158 -.423 -.032 .015
VAR00014 .645 .292 -.176 -.297 -.339
VAR00015 .619 .506 -.137 -.073 -.180
VAR00016 .291 .746 .068 .163 -.064
VAR00017 .489 .534 .124 -.119 .360
VAR00018 .411 .516 .115 .213 .208

Extraction Method: Principal Component Analysis.a

a. 5 components extracted.

Rotated Component Matrixa

Component

107 | P a g e
 1 2 3 4 5

VAR00001 .066 .179 .081 .056 .809

VAR00002 .066 .722 .302 -.217 .105
VAR00003 .730 .035 .136 -.139 .284
VAR00004 .760 .055 -.107 .205 .187
VAR00005 .294 .760 -.106 .105 -.009
VAR00006 .416 .179 .304 .495 .042
VAR00007 .336 .447 .155 .220 .458
VAR00008 -.010 .691 .178 .280 .261
VAR00009 .097 .625 -.108 .583 .231
VAR00010 .222 .473 .056 .490 .345
VAR00011 .502 .431 .087 .354 -.242
VAR00012 .740 .224 .189 .160 -.090
VAR00013 .627 .103 .011 .294 -.034
VAR00014 .231 .059 .310 .763 .014
VAR00015 .229 .002 .577 .553 .079
VAR00016 -.068 -.146 .765 .199 .161
VAR00017 .079 .299 .731 .135 -.189
VAR00018 .104 .130 .703 .014 .119

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.a
a. Rotation converged in 21 iterations.

Component Transformation Matrix

Component 1 2 3 4 5
1 .541 .538 .357 .491 .221
2 -.279 -.382 .861 .149 -.108
3 -.706 .610 .102 -.111 .327
4 .276 -.207 .185 -.545 .741
5 .233 .386 .293 -.653 -.533

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.

Descriptive Statistics

108 | P a g e
 N Minimum Maximum Mean Std. Deviation Variance

VAR00001 93 1.00 5.00 3.8280 .82914 .687

VAR00002 93 1.00 5.00 3.0968 .80844 .654
VAR00003 93 1.00 5.00 3.5269 .87962 .774
VAR00004 93 1.00 5.00 3.6596 .95662 .915
VAR00005 93 1.00 5.00 3.1720 .81592 .666
VAR00006 93 1.00 5.00 3.6774 .92268 .851
VAR00007 93 1.00 5.00 3.2581 .89568 .802
VAR00008 93 1.00 5.00 2.9570 .89581 .802
VAR00009 93 1.00 5.00 3.1183 .97634 .953
VAR00010 93 1.00 5.00 3.1848 .92498 .856
VAR00011 93 1.00 5.00 3.4022 .90250 .815
VAR00012 93 2.00 5.00 3.5591 .90244 .814
VAR00013 93 2.00 5.00 3.3656 .84423 .713
VAR00014 93 1.00 5.00 3.3548 .96284 .927
VAR00015 93 1.00 5.00 3.3617 .94870 .900
VAR00016 93 1.00 5.00 3.3298 .92036 .847
VAR00017 93 1.00 5.00 3.3936 .83238 .693
VAR00018 93 1.00 5.00 3.4149 .86023 .740
Valid N (listwise) 93

Interpretations of factor analysis:

Factor Analysis is necessary as all the attributes above are somewhat important to

109 | P a g e
respondents, which can be combined in groups to reduce the attributes being
studied.
Respondents were asked to rate the various attributes of Shakti Bhog’s Basmati
Rice on the scale of 5.

The Scale was-

5. Best 4. Excellent 3. Good 2. Average 1. Poor
Out of 18 variables we are able to reduce them to 5 factors which are free from
redundancy.

After the statistical computations of factoring have been completed, the next step is
to interpret these factors. This is achieved by inspecting the pattern of high and low
loading of each of the factors on the variables.

Factor- 1: Features Label

1. Quality
2. Health Benefits
3. Price

Label Factor Mean Standard Variance

Loading deviation
1. Quality .760 3.6596 .95662 .915
2. Health Benefits .740 3.5591 .90244 .814
3. Price .730 3.5269 .87962 .774

Interpretation: We find that the first factor comprises of three attributes. Out of these
three variables, the first variable Quality influences the most within the factor. This
attribute, has the highest factor loading of 0.760 with the highest mean of 3.6596. So the
firm Shakti Bhog is doing well as far as the Quality is concerned. All the three attributes
within this factor have positive loading therefore we can say that these attributes affects
the consumers decision significantly.

Factor- 2: Image Label

1. Packaging

110 | P a g e
2. Advertisement
3. Promotion
4. Uniqueness

Label Factor Mean Standard Variance

Loading deviation
1. Packaging .760 3.1720 .81592 .666
2. Advertisement .722 3.0968 .80844 .654
3. Promotion .691 2.9570 .89581 .802
4. Uniqueness .625 3.1183 .97634 .953

Interpretation: We find that the second factor comprises of four attributes. Out of these
four variables, the first variable Packaging influences the most within the factor. This
attribute, has the highest factor loading of 0.760 with the highest mean of 3.1720. So the
firm Shakti Bhog is doing well as far as Packaging is concerned. All the four attributes
within this factor have positive loading therefore we can say that these attributes affects
the consumers decision significantly.

Factor- 3: Cooking Label

1. Cooking Time
2. Aroma (fragrance) of cooked Rice
3. Condition of Cooked Rice

Label Factor Mean Standard Variance

Loading deviation
1. Cooking Time .765 3.3298 .92036 .847
2. Aroma (fragrance) .731 3.3936 .83238 .693
of cooked Rice
3. Condition of cooked .703 3.4149 .86023 .740
Rice

Interpretation: We find that the third factor comprises of three attributes. Out of these
three variables, the first variable Cooking Time influences the most within the factor. This

111 | P a g e
attribute, has the highest factor loading of 0.765 with the highest mean of 3.3298. All the
four attributes within this factor have positive loading therefore we can say that these
attributes affects the consumers decision significantly.

Factor- 4: Physical Label

1. Size of Rice

Label Factor Mean Standard Variance

Loading deviation
1. Size of Rice .763 3.3548 .96284 .927

Interpretation: We find that the fourth factor comprises of one attribute. This attribute,
has factor loading of 0.763 with mean of 3.3548. So the firm Shakti Bhog is doing well as
far as Size of Rice is concerned. This attribute in fourth factor has positive loading
therefore we can say that this attribute affects the consumers decision significantly.

Factor- 5: Popularity Label

1. Brand Name

Label Factor Mean Standard Variance

Loading deviation
1. Brand Name .809 3.8280 .82914 .687

Interpretation: We find that the fifth factor comprises of one attribute. This attribute,
has factor loading of 0.809 with mean of 3.8280. So the firm Shakti Bhog is doing well as
far as Brand Name is concerned. This attribute in fifth factor has positive loading therefore
we can say that this attribute affects the consumers decision significantly.

Q.11: Which variety of Shakti Bhog basmati rice you

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prefer/consume?

Varieties Observations
Royal Swad 12
Premium Gold 13
Indian Traditional 25
Export Gold Rice 22
Authentic Basmati
Rice 11
Premium Basmati
Rice 11
Others 0

Others 0

Premium Basmati Rice 11

Authentic Basmati Rice 11

Export Gold Rice 22

Indian Traditional 25

Premium Gold 13

Royal Swad 12

0 5 10 15 20 25

Observations

Most of respondents prefer Indian traditional variety of Shakti Bhog for

basmati rice.

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Q.12: How will you rate Shakti Bhog’s Basmati Rice?
Ratings Observations
Poor 5
Average 24
Good 38
Excillent 27

27
Excillent

38
Good

24
Average

5
Poor

0 5 10 15 20 25 30 35 40

Observations

Most of respondents rate Shakti Bhog Basmati Rice that Shakti Bhog Rice is
Good.

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Q.13: What type of drawbacks you found in Shakti
Bhog’s Basmati Rice (you can choose multiple options
also)?
Drawbacks Observations
Taste 19
Quality 19
Packaging 17
Expiry 3
No Drawback 45
Others 13

Others 13

No Drawback 45

Expiry 3

Packaging 17

Quality 19

Taste 19

0 5 10 15 20 25 30 35 40 45

Observations

Most of respondents found No Draw Back in Shakti Bhog Basmati Rice.

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Q.14: Do you think Shakti Bhog can make bigger market
in future comparing now?
Answer Observations
Yes 54
No 11
Can't Say 37

Observations

Can't Say
36%

Yes
53%

No
11%

Most of respondents think that Shakti Bhog can make bigger market in the
future for basmati rice.

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 SWOT ANALYSIS
The SWOT analysis involves an in depth study of the strength and weakness of the
provided organization and it also provides information to the promoter, consultant,
other agencies and helps in long term viability of the project.

Strength:
1. It is the oldest and most well experienced player.

2. Shakti Bhog has a strong and very well developed distribution network.

3. It is having a huge consumer base and is evolved as one of the most powerful
brands of the country.

4. It has a large product portfolio and worldwide market.

5. It has the advantage of well-known firm from many years.

6. One of the largest Companies in the world in this field.

Weakness:

1. It has an image of a local agency.

2. High range of price of its products.
3. Supply is less than demand in local shops.
4. Some varieties are quite similar to each other.
5. Its products are expensive for poor persons.

Opportunity:

1. Shakti Bhog giving a tough competition to India Gate.

2. Its demand now increasing very rapidly more than comparing before.
3. Be on top by leaving India Gate behind.
4. Since it has branches worldwide so it is now consider as worldwide reputed
company.
5. Now company is looking for low price products. Which are about to launched.

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Threats:

1. Shakti Bhog can be number one in basmati rice most demanded company all
over India in the future.
2. Shakti Bhog is going to increase its market by opening new branches all over
the world.
3. Last few years in the field of basmati rice Shakti Bhog feel a very high
increase of its products sold. Selling increased by 20% in last 5 years. So they
are expecting more selling of their products in the future. Their expectation is
increase selling more by 30% in upcoming 5 years.
4. Shakti Bhog is thinking to launch new varieties in the field of basmati rice.
It already has 6 varieties of basmati rice.

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FINDINGS AND CONCLUSIONS BASED ON
PRIMARY RESEARCH.

Findings:-

14% population is not use basmati rice.

Shakti Bhog, India Gate, Kohinoor & Lal Qilla are major players in the
field of Basmati rice.
India Gate is on the TOP in the field of basmati rice market share.
Almost 26% respondents be loyal customer for their respective brand
since 2 years.
Discount is another main factor which affecting consumer buying
behavior for basmati rice.
5 kg. of basmati rice is consumed by mostly respondents.
Consumers are looking for mostly 5 kg. packet of basmati rice.
Retail stores are used by mostly consumers while purchasing basmati
rice.
Brand name has a very good effect while purchasing basmati rice.
Mostly consumers think about quality of the basmati rice while
purchasing it and go for the best one.
Condition of cooked rice should be very good according to survey.
India gate has 30% of market share for basmati rice while India gate has
21%.
37.20% consumers used Shakti Bhog basmati rice. Out of this 16.20%
left it and move to other brand.
Shakti Bhog has 21% loyal consumers.
22% consumers choose Shakti Bhog Basmati Rice because of brand
name.
According to the survey mostly consumers are satisfied with quality &
taste of Shakti Bhog Basmati Rice.
Indian Traditional is most demanding variety of Shakti Bhog Basmati
Rice.

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 Consumers rated Shakti Bhog Basmati rice as Good.
According to survey mostly consumers did not find any draw back in
Shakti Bhog Basmati Rice.
Consumers thought that Shakti Bhog can make bigger market in the
field of basmati rice.
Shakti Bhog has mostly consumers whose household income is more
than Rs.40000 and in between Rs.30000-Rs.40000. The weightage of
percentage of both types of household income is approximately equal
i.e. 38%.
South Delhi has the highest no. of consumer of basmati rice i.e. 24.19%.
No. of persons who are living together if 4 or more than 4 then they are
using basmati rice in huge amount and they are 78% of the total
consumer of basmati rice.
Consumers who are Homemaker by occupation are used to buy basmati
rice more than other consumers who have any other occupation.
Most of consumers visit retail stores to buy basmati rice and North
Delhi region’s consumers are on the top to visit retail stores.

Conclusions:-

As 14% population is not used basmati rice. The reason may be price so
Shakti Bhog must launch some varieties of basmati rice at cheaper cost
for this population.
As I experienced 1kg. packet is expensive than 5kg. if we calculate 1kg.
price of 5kg. packet. So firm must reduce price of 1kg. packet’s price to
increase the sale of 1kg. packet.
India Gate has highest market share because it has wide range of
varieties so Shakti Bhog should increase varieties to give a tough
competition to India Gate.

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As consumers are looking to get discount while purchasing basmati rice
so firm should announce some attractive discounts on their products on
regular period of time.
Consumers who switching brand from Shakti Bhog to other brand for
them firm should announce some offers so that firm can keep customer
more than now.
Most of customer are have house hold income more than Rs.30000
because expensiveness of basmati rice. So firm should lower the price to
increase the sales.
Since consumers get some good discount in retail stores so they visit
retail stores to buy basmati rice in it. So firm should announce some
discount at lower level to increase sales in local kirana shops & general
stores.

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QUESTIONNAIRE ON BRAND VALUE OF SHAKTI BHOG FOR
BASMATI RICE

QUESTIONNAIRE

Dear Respondent I am Harsh Dev Jaiswal, student of M.Sc. Operational

Research, University of Delhi. I am undertaking a market survey as a part of
my project work.
Please fill the Questionnaire; it won’t take more than 5 minutes.
Personal Information:
1. Gender: Male Female

2. Age: Below 18 Years 18-27Years 28-37 Years

38-47 Years Above 47 Years

3. Area of Residence:
North Delhi
East Delhi
West Delhi
South Delhi
Central Delhi

4. Occupation:
Business Professional Service Homemaker Student

Others (please specify) _______

5. Education:
a) Upto HSC b) Graduate

c) Post-graduate d) Others (specify) ____________

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6. Household Income (monthly):
a) Rs.10000-20000 b) Rs.20000-30000

c) RS.30000-40000 d) RS.40000 and above

7. Marital Status:
a) Married b) Unmarried

c) Others (Specify) _____________

8. No. of person/s who is/are living with you:

a) 1 b) 2 c) 3 d) 4 e) more than 4

Part-I
9. Brands you aware about (you can choose multiple options also):
a) Best Basmati Rice b) Kohinoor Basmati Rice

c) India Gate Basmati Rice d) Lal Qilla Basmati Rice

e) Shakti Bhog Basmati Rice f) Dawat Basmati Rice

g) Dunar Basmati Rice h) Doon Basmati Rice

i) Saffola Arise Basmati Rice j) Tirupati Basmati Rice

k) Any other (specify) _______________

10. Do you use basmati rice? :

a) Yes b) No

(If no then please move to question number- 24)

11. Which brand you like to purchase for basmati rice:

a) Best Basmati Rice b) Kohinoor Basmati Rice

c) India Gate Basmati Rice d) Lal Qilla Basmati Rice

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 e) Shakti Bhog Basmati Rice f) Dawat Basmati Rice

g) Dunar Basmati Rice h) Doon Basmati Rice

i) Saffola Arise Basmati Rice j) Tirupati Basmati Rice

k) Any other (specify) _______________

12. From how many years you are using above mentioned brand:
a) 1 year b) 2 years c) 3 years d) 4years

e) More than 4 years

13. Approximately what quantity of basmati rice consume per month (in k.g.):

a) 1 b) 2 c) 3 d) 4 e) 5 f) more than 5

14. Size of the basmati rice packet you prefer to buy (in k.g.):
a) 1 b) 2 c) 5 d) 10

15. Which channel do you prefer to purchase basmati rice?

a) Local Kirana shops b) Retail Stores (big bazar, big apple etc.)

c) General Stores d) Others (specify) _______________

16. On a scale of 1-5, rate the importance of the following attributes you consider while
purchasing basmati rice:

Attributes 1-(Not 2-(Less 3- 4-(Very 5-

important important) (Importan Importa (Extreme
) t) nt) ly

Importa
nt)
Brand name

Advertisement

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Price

Quality

Packaging

Taste
(flavor)
Discount
(offer)
Promotion

Uniqueness

Recommendation

Availability

Health Benefits

Product Expiry

Size of the rice

Thickness of the
rice
Cooking time

Aroma(fragrance)
of cooked rice
Condition of
cooked rice

17. Did you ever use Shakti Bhog Basmati Rice?

a) Yes b) No

(If no then please move to question number-24)

Part-II

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18. Why did you choose Shakti Bhog Basmati Rice (you can choose multiple options also):
a) Recommendation b) Price

c) Advertisement d) Bored from previously used brand

e) Brand Name f) Quality

g) Packaging h) Discount

i) Others (specify) ____________

19. On a scale of 1-5, rate the following attributes of Shakti Bhog’s Basmati Rice:
Attributes 1-(Poor) 2- 3-(Good) 4- 5-(Best)
(Average) (Excellent
)
Brand name

Advertisement

Price

Quality

Packaging

Taste
(flavor)
Discount
(offer)
Promotion

Uniqueness

Recommendation

Availability

Health Benefits

Product Expiry

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Size of the rice

Thickness of the
rice
Cooking time

Aroma(fragrance
) of cooked rice
Condition of
cooked rice

20. Which variety of Shakti Bhog basmati rice you prefer/ consume:
a) Royal Swad b) Premium Gold

c) Indian Traditional d) Export Gold Rice

e) Authentic Basmati Rice f) Premium Basmati Rice

21. How will you rate Shakti Bhog’s Basmati Rice?

a) Poor b) Average

c) Good d) Excellent

22. What type of drawbacks you found in Shakti Bhog’s Basmati Rice (you can choose
Multiple options also):

a) Taste b) Quality

c) Packaging d) Expiry

e) No Drawback f) Others (specify) _______________

23. Do you think Shakti Bhog can make bigger market in future comparing now?
a) Yes b) No

c) Can’t Say

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24. Would you like to give any suggestion to improve sales? (Optional)
Please Specify Here:

THANK
YOU!

BIBLIOGRAPHY

The following books and websites were referred to in the execution of

this project:
1. FUNDAMENTALS OF APPLIED STATISTICS
S.C.GUPTA & V.K.KAPOOR
Sultan Chand & Sons
2. MARKETING RESEARCH
N.K.MALHOTRA
Pearson Education, Inc.
3. STATISTICAL METHODS
S.P.GUPTA
Sultan Chand & Sons
4. INTRODUCTION TO OPERATIONAL RESEARCH
HILLER &LIEBERMAN

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 Tata McGraw-Hill Edition
5. MARKETING RESEARCH
David A. Aaker, V.kumar, George.S.Day
John Wiley & Sons,Inc

SITES USED:
www.google.com
shaktibhog.tradeindia.com
www.wikipedia.org

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