This action might not be possible to undo. Are you sure you want to continue?
Page | 1
A Study on the Customer Satisfaction Level and to make Newer and innovative strategies for effective customer retention. A summer (Dissertation) Project Report Submitted in partial fulfillment of the requirements for the award of the degree of Post Graduation Diploma in Management (Marketing & HR)
By- Debdattaa Saha (P09011)
Under the guidance of Mr. Dipak Kumar Das (Retail Sales Manager, IOCL, Kolkata Divisional Office) and Sir Cris Abraham K (Faculty Guide and Batch Coordinator, DCSMAT Business School)
Page | 2
DCSMAT Business School DC County, Pullikkanam, Vagamon Idukki, Kerala - 685503
Date-----------------TO WHOMSOEVER IT MAY CONCERN
This is to certify that ___________________, PGDM student of DCSMAT Business School; Kerala has done her/his Project titled “_________________________” in our company during the period from ___to__________.
During the above period, he/she has _________________________ (comments by the project guide or company official) and his/her conduct and character were found to be good.
Page | 3
We wish all the success in her future endeavors.
Name ---------------Designation ------------
This is to certify that the project entitled “___________________________________________” is the bona fide record of the work done by ___________, PGP_______, ________trimester PGDM student of ___________ batch, submitted in partial fulfillment of the requirements for the award of Post Graduate Diploma in Management.
Faculty Guide: ________
Page | 4
Page | 5
First and foremost, I would like to express my gratitude to the Alma Mater, “Institution, DC School of Management and Technology Business School” for providing me a magnificent opportunity in the form of this dissertation to work and learn. Secondly I would like to thank my “Industry Guide (Mr. Dipak Das)” who has helped me a lot in preparation of this project. He was always been a constant source of inspiration during all the time of project. His valuable feedbacks, guidance & encouragement helped me to accomplish my task. Thirdly I would like to thank my “Project Guide (Sir Cris Abraham K)” on the completion of my project. He motivated me throughout the project & always gave useful feedback whenever I felt short of ideas. I cordially express my gratitude to him for sharing the journey of conceptualizing and developing all the ideas. He stood in times of difficulty and despite of his busy schedule devoted a major chunk of his time towards this project. He has been a part of all the activities and duly guided the project to its destination. I am indebted for his endeavors in making this project a success. He has truly fulfilled his role as a guide. I would also like to thanks my “Parents” for providing me with constant motivation during my whole project tenure. I would also like to thanks for the help and support extended by all my “Friends” whose names could not be mentioned here. They all have been very co-operative and provided impetus to this project. Without their help
Page | 6
this project would not have reached its destination. I express my gratitude for their suggestions and help they extended to this project. I will not miss the opportunity of expressing thankfulness towards all my teachers and the faculty of DCSMAT Business School for sharing their knowledge, which provided necessary ingredients to this project. Last but not the least I would like to thank each and every person individually who has devoted their valuable time in the completion of my survey data sheet. In the end, I want to thank Mr. Bill Gates and his Microsoft Corp. for MS Word, MS Excel and MS PowerPoint. Without them this report would not have been in its present form. TABLE OF CONTENTS Title: Page
1. Executive Summary a. Phase 1- The Starting of the Research b. Phase 2- Survey Work Detail 2. Brief Analysis of the Report 3. Literature Review 15-20 a. Brief Survey of current trends & theories b. Definitions c. Customer satisfaction and its Process d. Satisfaction-Loyalty Link e. Consequences of Customer Loyalty f. Target the Right Customers 4. Introduction 21-24 a. Customer Retention b. Customer Satisfaction c. Customer Relationship Marketing d. Benefits of CRM e. Customer Loyalty 5. An Insight into the Research a. Need for the Research b. Research Problem c. Research Objective d. Scope of the Research e. Research Methodology f. Type of Research g. Sources of Information and Tools for data Collection h. Sampling Techniques i. Sample Size j. Research Design 9-12 11 11-12 13-14 16-17 17-18 18 19 19-20 20 22 22 23 23 23-24 25-31 26 26 27 27 28 28 29-30 30 31 31 Page | 7
k. Limitations of Research 31 6. Industry Profile 32-37 a. Petroleum Industry 33 b. Evolution of Oil and Gas Industry in India 33 c. Preamble 34 d. Petroleum Sector Reforms, 1990 34 e. Foreign Companies in Exploration in India 34 f. Indian E & P companies 35 g. Opening of Oil/ Gas Fields for development by private sectors 35 h. Various Production segments 36 i. India as an International refining destination 36 j. Indian Petroleum Retail market 36 k. Investment in Indian Petroleum Industry 37 l. Future of Indian Petroleum Industry 37 7. Company Profile of Indian Oil 38-55 a. Present Scenario 39 b. Profile 39-46 c. Vision and Mission 46 d. Objectives and Obligations 46-48 e. Indian Oil-A National Brand 48 f. Competitive Force Analysis 49-50 g. SWOT Analysis of Indian Oil 51-52 h. PEST Analysis of Indian Oil 53-54 i. 4P’s of Indian Oil 55 8. Competitor’s Profile 56-66 a. Bharat Petroleum Corporation Limited 57-61 b. Hindustan Petroleum Corporation Limited 61 c. Reliance Petroleum Limited 62 d. Essar Oil 62-63 9. An Evaluation of Customer Expectation and Customer Satisfaction 64-96 a. Stage 1: City samples collected from IOCL ROs 65-83 b. Stage 2: City samples collected from Taxi Association 84-87 c. Stage 3: City samples collected from Bus & Truck Terminus 88-89 d. Stage 4: Highway samples collected from IOCL ROs 90-96 10.Suggestion and Recommendation 97-108 a. Non Fuel Retailing 98 b. India as a Non Fuel Retailing Destination 99 c. Recommendations for non fuel offerings 100102 d. Branded Fuel and its Promotion 103 e. Recommendation for promotion of Branded Products 103105 f. Recommendations for Fleet card users 106-107 g. Recommendations for Customer Retention 108 11.Conclusion 109-110 Page | 8
12.Appendix A 13.Appendix B 14.Bibliography
111-112 113-114 115
Page | 9
The Indian retail industry can be segmented in different segments viz. cosmetics, footwear, sanitary products, entertainment etc. The downstream petroleum retailing is one of the largest segments of the Indian retail industry and the petro-retail sector is one of the most organized sectors of the retail industry. India had deregulated the petroleum retail sector in 2002 by dismantling APM and enabling new players to enter the market. The entry of private players like Reliance, Essar, Shell, NRL, and many more have increased the competition by means of the quality of fuel and the non fuel offerings at their retail outlets. With a market determined pricing mechanism in place, prices will be lowered, which would reduce the margins from fuel products. In such circumstances, the petroleum retailers will need to have differentiated value propositions to improve revenues. It will require customer centric approach and building of a strong brand equity and identity. Non-fuel products tender higher margins as compared to petroleum products and enable companies to sustain themselves, especially during times when oil prices are high. However, it is to be kept in mind that petroleum retailing is a retailing of petroleum product and service, with differentiation possible in either or both areas. Now, it is not all about offering fuel only at the petrol stations. The new look petrol pumps, apart from dispensing fuels; now offer the best of retail chains providing a value added service to busy consumers. This trend is in circulation in the international markets and the big petrol station convenience stores earn more than 30 to 40 per cent of their profits from the non-fuel activities. The range of value added services is all beneath one roof. The new-look petrol pumps are now the more advanced multi-purpose dispenser petrol-pumps. The petrol pumps are computerized, thus reducing waiting time which not only ensures accuracy, but also saves a lot of time for customers and avoids misconception and arguments. The study gives a comprehensive
Page | 10
overview of petroleum industry in India, the way it has evolved through shackles of time and its current status with respect to companies, regulations and customers. The study tracks the origin and the journey of industry till date. It has also focused on the kind of services expected by consumers, which are being provided on retail outlets and which can be provided on outlets and by which Customer can be retained and new customer can be pulled as well as the brand image of the company increases. These services will cumulatively increase the revenue realization as well as optimal utilization of land available on an outlet. The project title was “To study the buying behavior and customer satisfaction based on which newer strategies can be made for customer retention”. The research work was divided into two phases for reporting & analyzing the factors respectively. Each phase is being described as follows:Phase 1: Phase 1 was the starting point of research work & its duration was about 2 weeks. Before going out for primary research work, I studied the petroleum industry and its two branches i.e., upstream and downstream with the help of internet & collected some useful insight about the industry. In the primary research work, I first of all decided on the customer profiling who all are linked with the petroleum industry and how and to what extent. These persons/stakeholders were as follows:1. 2. 2 Wheelers 3. 4 Wheelers 4. 6 Wheelers 5. 10 Wheelers 6. 14 Wheelers 7. Taxi Drivers 8. Bus Owners 9. Transporters 10.Agricultural Customers 11. Corporate Customers Then I had carried an exploratory survey for each stakeholder without drawing any questionnaire. This random sample helps me to understand the various factors affecting the buying decision of the fuel from a specific fuel player in India. But the information which I get was quite raw & hence I moved on to the second phase for a systematic review of the enlisted factors gathered from the exploratory survey.
Page | 11
Phase 2: After understanding the enlisted factors, I formed the questionnaire, covering each & every aspect about buying behavior of the customers and the extent of their satisfaction. I form different questionnaire for all stake holders from the point of view of that segment of people. The sample data collection from all the stakeholders had taken duration of around 5 weeks. I decided to carry out the survey on the basis of geographical segmentation. Firstly I divided the whole survey in to two parts which are as follows: • • City ○ North ○ South Highways ○ NH 34 ○ NH 35 ○ Kalyani Expressway
In the first week I covered the Kolkata City North. I had taken a sample of 100 from 4 Retail Outlets. In the second week I covered the Kolkata City South. The third week was devoted to cover the Highways. In the fourth week I covered the Taxi Drivers and Transporters. From this survey I try to figure out the relationship between the buying behavior of drivers & their economic background and tried to make some strategies on the basis of which the permanent customers can be retained by some new loyalty programs. This survey was covered in the fifth week. The remaining days of my research work were used to draft out the studied factors on the word file & give it the shape of a project report.
Page | 12
Page | 13
Brief Analysis of the Report
Overall from the given feedback & analysis it can be clearly stated the fact that the “Quality” and “Customer Service” have a neck-to-neck fight in acquiring the top most factor which is affecting the buying decision of Fuel. Hence in order to increase the sales we have to increase the perceived value in the minds of consumers about the Quality parameter of the Fuel as well as the Customer Service in the Indian Oil Retail Outlets. The Customers choose a Retail Outlet, generally, on the basis of Customer Service and Quality and Quantity. Their expectations as a general customer confined to Quality and Quantity and Customer Service as well. But today’s customers are smarter and choosier. Retaining such customers need extensive smart services as well as customized products for them. Only fuelling in the Retail Outlets is a decade old story. Now the faster life style of the customers craves for multi-utility fuel stations where they can have a cup of coffee while fuelling. Our study and its analysis says that economical condition is a factor for the amount of refueling per month but economical condition is neither correlated with the type of product used and nor with the expectations of the customer. All customers want an excellent Customer Service with equally excellent Quality and Quantity. It is also been found that the sale of the branded fuel is dependent on its price to a great extent. Company can make some strategies by which they can mould the customers about the branded fuels without changing its price. For example, they can provide some gifts to the branded fuel customers and can also introduce some loyalty programs exclusively for branded fuel users.
Page | 14
Elaborate recommendations and strategies suggested are discussed later in the report.
Page | 15
Businesses are in a constant race to increase profits, keep current customers and gain or poach new ones, competing for customers on a globalised market like never before. One of the many sets of tools aimed at aiding the interaction between supplier and customer is customer relationship management (CRM). CRM is aimed at building strong, long-term relationships that keep customers coming back repeatedly. It aims to help organizations build individual customer relationships in such a way that both the firm and the customer get the most out of the exchange, providing both parties with long term benefits. The purpose of this thesis is to provide a better understanding of the use of CRM in B2B firms. To reach this understanding the thesis starts with three research questions that focus the objectives of CRM, CRM strategies, and how CRM is measured. Using these three questions as a guide to the literature review for this study, a frame of reference is developed and used to collect data from two large firms operating from Sweden, Haldex and Nefab. These companies were studied through case analysis and compared to each other and to theory. The data collected from them was primarily attained through structured interviews. The findings indicate that much of the explored theory regarding CRM is true for the B2B sector. There are however a few areas in which the firms diverge from theory, specifically those relating to the usage of estimated values such as loyalty and satisfaction in customer evaluations. It was also found that there is a lack of research in the areas of evaluation of CRM. Furthermore the findings indicates that CRM in B2B settings focuses on the organizational aspects of CRM, and a strong goal for businesses is to unlock the information the employees have and store it in a place the business can own and find use of. Brief Survey of Current Trends and Theories:
Page | 16
Loyalty is dead, the experts proclaim, and the statistics seem to bear them out. On average, the U.S. corporations now lose half their customers in five years, half their employees in four, and half their investors in less than one (Reichheld, 1996). No, loyalty is not dead; it remains a dominant key of success. In fact, the corporate leaders in loyalty – that apply a strategic loyalty-based management – have enduring records of productivity, solid profits and steady expansion. More than a limited customer approach, the loyalty effect should be viewed as a wide context in which all the key players of a firm are far more powerful, further reaching, and more interdependent than we have ever imagined. There would be no customer loyalty without loyal employees as there would be no loyal employees without long term investors. We will later focus on the customer side, but the employees and the investors problematic should be kept in mind during the entire process. We will also, now and then, show the implications of such a three dimensional environment in which creating value for customers has become a strategic issue. The advantages of loyalty are numerous, but the implementation of such a culture does not go without posing problems. What should be done, who should be responsible for these changes, who should be targeted, and how should these changes be conducted are some of the questions we will try to answer in this compilation of some classical theories of the day (1998). Definitions: Loyalty Reichheld opposes loyalty to the actual profit-theory. This theory gathers the firm's resources toward one unique goal: creation of profit. Reichheld views loyalty as a value-creation theory. The fundamental mission of a business is oriented toward the creation of value for the customer and profit becomes a consequence of value creation. It turns out to be a mean rather than an end. Customer loyalty Customer loyalty is not always easy to construe and many definitions have been proposed. Let's first settle what customer loyalty is not (Prus & Randall, 1995): Customer loyalty is not customer satisfaction. Satisfaction is a necessary but not sufficient criterion. We know that "very satisfied" to "satisfied" customers sometimes switch to competitors.
Page | 17
Customer loyalty is not a response to trial offers or incentives. Customers who react to incentives are often highly disloyal and they often leave as fast as they came. They are very much inclined to respond to a competitor's incentive. Customer loyalty is not a strong market share. High level of market share can also be influenced by other factors such as poor performance by competitors or price issues. Customer loyalty is not repeat buying or habitual buying. Some of your consumers choose your products because of convenience or habits and they can be tempted to defect for any reason. Prus & Randall then describe customer loyalty as follows: "Customer loyalty is a composite of a number of qualities. It is driven by customer satisfaction, yet it also involves a commitment on the part of the customer to make a sustained investment in an ongoing relationship with a brand or company. Finally, customer loyalty is reflected by a combination of attitudes (intention to buy again and/or buy additional products or services from the same company, willingness to recommend the company to others, commitment to the company demonstrated by a resistance to switching to a competitor) and behaviors (repeat purchasing, purchasing more and different products or services from the same company, recommending the company to others)". Customer satisfaction Satisfaction is often confused with loyalty. Satisfaction is an emotional or feeling reaction (Westbrook, Newman, Taylor, 1978). It is the result of a complex process that requires understanding the psychology of customers. The range of emotion is wide with, for example, contentment, surprise, pleasure, or relief. Satisfaction is influenced, in the end, by expectations and the gap between perceived quality and expected quality, called "expectancy disconfirmation". The figure below shows the predominant linkage of this process.
Page | 18
Satisfaction-Loyalty link High-quality products and associated services designed to meet customer needs will create customer satisfaction. This high level of satisfaction will produce increased customer loyalty. According to conventional wisdom, we would be tempted to believe that the link between satisfaction and loyalty is a simple, linear relation. But reality proves us wrong: it is neither linear nor simple (see figure "The effect of satisfaction" below). The relation reacts differently according to time and circumstances. Unless they are totally satisfied, there is always a chance you will see your customers be lured away (Jones & Sasser Jr., 1995).
Page | 19
Consequences of Customer loyalty Businesses with high customers' loyalty rates have proven to reach great financial results. Buchanan & Gillies identified six reasons explaining why long-term customers are more profitable than others are: 1. Regular customers place frequent, consistent orders and, therefore, usually cost less to serve. 2. Long-established customers tend to buy more. 3. Satisfied customers may sometimes pay premium prices. 4. Retaining customers makes it difficult for the competitors to enter a market or increase their share. 5. Satisfied customers often refer new customers to the supplier at virtually no cost. 6. The cost of acquiring and serving new customers can be substantial. A higher retention rate implies that fewer new customers need be acquired, and that they can be acquired more cheaply. In fact, the acquisition cost of a new customer is three to five times more expensive than retention cost. We could also add that a loyal customer is more willing to give feedback on his dissatisfaction and becomes this way a sort of quality controller. Finally, loyalty is an excellent weapon, since it is almost impossible to measure a competitor's retention rate. Target the "right" customers Before retaining all the customers at any price, it is very important to identify your core customers. There are three easy questions you can ask yourself (Reichhheld, 1996). First, who are your more profitable and loyal customers? You will look for those who spend more, pay promptly, require less service, and prefer stable, long-term relationship.
Page | 20
Second, which customers place the greatest value on what you offer? Those for whom the product fits best to their needs. Third, which of your customers are worth more to you than your competitors? The more customers fitting one, two, or three of these groups you attract, and the more you increase the chances to have loyal customers. All customers are not good to keep. That's why it is critical to know the characteristics of the customers you target.
Page | 21
Customer Retention: It is the activity that a selling organization undertakes in order to reduce customer defections. Successful customer retention starts with the first contact an organization has with a customer and continues throughout the entire lifetime of a relationship. A company’s ability to attract and retain new customers, is not only related to its product or services, but strongly related to the way it services its existing customers and the reputation it creates within and across the marketplace. Customer retention is more than giving the customer what they expect; it’s about exceeding their expectations so that they become loyal advocates for
Page | 22
your brand. Creating customer loyalty puts ‘customer value rather than maximizing profits and shareholder value at the center of business strategy. The key differentiator in a competitive environment is more often than not the delivery of a consistently high standard of customer service.
Customer satisfaction: Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy. Organizations need to retain existing customers while targeting non-customers. Measuring customer satisfaction provides an indication of how successful the organization is at providing products and/or services to the marketplace. Customer satisfaction is an abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also vary depending on other factors the customer, such as other products against which the customer can compare the organization's products. Customer Relationship Marketing: Customer relationship management (CRM) is a broadly recognized, widely-implemented strategy for managing and nurturing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing, customer service, and technical support. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service. CRM denotes a company-wide business strategy embracing all client-facing departments and even beyond. When an
Page | 23
implementation is effective, people, processes, and technology work in synergy to increase profitability, and reduce operational costs. It is important to emphasize that CRM is a specialty within marketing, and to implement CRM in a company, you can use tools as CRM systems, mailers, databases etc. CRM is commonly misunderstood, thinking it is an IT system. Benefits of CRM: These tools have been shown to help companies attain these objectives: • •
Streamlined sales and marketing processes Higher sales productivity Added cross-selling and up-selling Improved service, loyalty, and retention Increased call center efficiency Higher close rates Better profiling and targeting Reduced expenses Increased market share Higher overall profitability Marginal costing
• • •
Customer Loyalty: The term customer loyalty is used to describe the behavior of repeat customers, as well as those that offer good ratings, reviews, or testimonials. Some customers do a particular company a great service by offering favorable word of mouth publicity regarding a product, telling friends and family, thus adding them to the number of loyal customers. However, customer loyalty includes much more. It is a process, a program, or a group of programs geared toward keeping a client happy so he or she will provide more business. Customer loyalty can be achieved in some cases by offering a quality product with a firm guarantee. Customer loyalty is also achieved through free offers, coupons, low interest rates on financing, high value trade-ins, extended warranties, rebates, and other rewards and incentive programs. The ultimate goal of customer loyalty programs is happy customers who will return to purchase again and persuade others to use that company's products or services. This equates to profitability, as well as happy stakeholders. Customer loyalty may be a one-time program or incentive, or an ongoing group of programs to entice consumers. Buy-one-get-one-free programs are very popular, as are purchases that come with rebates or free gifts. Another good incentive for achieving customer loyalty is offering a risk free trial period for a product or service. Also known as BRAND NAME LOYALTY , these
Page | 24
types of incentives are meant to ensure that customers will return, not only to buy the same product again and again, but also to try other products or services offered by the company. Excellent customer service is another key element in gaining customer loyalty. If a client has a problem, the company should do whatever it takes to make things right. If a product is faulty, it should be replaced or the customer's money should be refunded. This should be standard procedure for any reputable business, but those who wish to develop customer loyalty on a large-scale basis may also go above and beyond the standard. They may offer even more by way of free gifts or discounts to appease the customer.
Page | 25
Need for the Research
In today’s world earning trust and maintaining it is a big challenge to any company, it is the customer for whom a company exists and tries to deliver the best product and service in the society. So in this regard a market research has been carried out to study and evaluate the extent of customer satisfaction and hence making strategies to retain them. The
Page | 26
market research has been given a title called “Relationship Marketing is the key to customer retention.” In the beginning we have to know where IOC stand in the customer mind and what are their expectation from us. For that I carried out a survey on various Indian Oil retail Outlet both on Kolkata City and National Highways. For carrying out the survey I prepared questionnaires on the above topic. After preparing the questionnaires and surveying the customer on the basis of it, I have got the trend and purchasing behavior of the customers. So, the need for the research is very strategic and important because this research is the only way by which customers can be evaluated as per their expectations, their satisfaction level and as well as their loyalty to a particular company.
The Research Problem was to find out the failure of Indian Oil Corporation Limited in regards to Customer Retention. The major crisis of this project is to find the loop holes of the existing loyalty programs and how far they are successful. If the existing loyalty program cannot retain as much as the customers possible then what should be the newer one and how it can be implemented.
Page | 27
1. To understand the Petroleum Retail Industry by secondary market research especially in Kolkata City and its outskirts Major Highways. 2. To analyze all the important properties & factors for the buying behavior analysis. 3. To carryout comparative analysis of all the major brands of fuels available. 4. To undertake exploratory survey of fuel market of Kolkata and its outskirts along with the evaluation for Brand awareness with the help of 2 Wheelers, 4 Wheelers, 6 Wheelers, 10 Wheelers, Taxi owners, Transporters and Private Car Users. 5. To formulate questionnaire on the basis of which survey is conducted and this will help to analyze and interpret the expectations of the customers and their extent of satisfaction. 6. To analyze the economic demography of the customers on the basis of their need to fuel per month and give finer strategy for each segment customer. 7. To analyze all the survey data & formulate recommendations based on it.
Scope of Research
• • • • The research work will be totally concentrated inside the Kolkata region and few major Highways in outskirts. The Research work will cover the respondents from 2 Wheeler, 4 Wheeler, 6 Wheeler, 10 Wheeler, Taxi Drivers and Transporters. It is based on detail analyzing of customer expectation from Indian Oil Corporation outlet both in Kolkata as well as in Highways. This study will help the Company to find out how the expectations of the customer can be fulfilled so as to increase customer retention rate as well as converting them to loyal customer of Indian Oil Corporation.
Page | 28
This research work is done to first find out the factors which affect the buying decision of fuel and the expectations of the customer and their satisfaction level & secondly on the basis of survey analysis, formulate recommendations to improve sales of Branded Fuels and other recommendations to retain the customers.
• Survey Methodology:
Here data were collected from various assigned IOC Retail Outlet in Kolkata and in Highways (NH 34, NH 35, Kalyani Expressway)
• Statistical Methodology:
After collecting the data, they were uploaded to excel sheet so as to analyze them with the motive of coming to various alternative conclusion.
Type of Research
The research work conducted is exploratory & descriptive in nature. This research work is used to investigate the factors which are affecting the buying decision of fuel and branded fuel and their expectations as well as their satisfaction level & marking perception of all profiles of customers about various fuel brands available in market. It’s an exploratory and descriptive research, as it has using both the secondary data and surveys respectively.
Page | 29
Sources of Collection
The data was been gathered through a survey based research approach with the help of questionnaire in 24 Indian Oil Retail Outlets all over Kolkata and its outskirts highways. The questionnaire was made in English but it was translated to Hindi and Bengali language for the convenience of the respondents. As the research work of writing & asking question was totally carried out by one person only, so human error related to recording of responses cannot be totally ruled out.
Name and Address of the City Retail Outlets Drive In 63/2B, Belgachia Road, Belgachia, Kolkata – 700037 R.B. Trading and Co. 101/2A, B.T. Road, Baranagar, Kolkata – 700090 R.N. Singh and Sons 16, Beliaghata Main Road, Beliaghata, Kolkata – 700010 Salt Lake Service Station DD-29, Sector-I, Salt Lake, Kolkata – 700064 Prince Service Station 377-B, Prince Anwar Shah Road, P.O. Jodhpur Park, P.S. Jadavpur, Kolkata – 700068 Binnu Enterprise 553, Block N, New Alipore, New Alipore, Kolkata – 700053 Anderson Auto Service 7, Belvedere Road, Kolkata 700027 –
Name and Address of the Highway Retail Outlets Gouripur Service Station Gouripur, P.O. Birati, NH-34, Pin-700051 Kanai Lal Paul Chandpara, Dist. (North), Pin-743245 24 Parganas
Garai Brothers Bhatjungla, NH-34, Krishnagar, Dist. Nadia, Pin-741102 Maa Sarada Fuels P.O. Gacha, Dist. Nadia, Pin-741126 Sadananda Singha and Brothers Chatimtala, NH-34, Chakdah, Dist. Nadia, Pin-741222 Maa Durga Fuel Station Vill.&P.O. Habibpur, P.S. Ranaghat, Dist. Nadia, Pin-741403 Zaman Service Station NH-35, Baluigachi, Lakshmipool, P.S. Habra, Dist. 24 (North) Pin-743234 P.O. Parganas
Bypass Services Plot-3B, RashBehari Avenue Connector, Rajdanga, Nabapally,
Gateway Transport Company Private Limited Court Road, P.O.&P.S. Bongaon,
Page | 30
Kolkata - 700107 Shantanu Carfil Plot No. 970 & 971, Baroda Avenue, Baishnabghata, Patuli Connector, Kolkata – 700084 Shankar Auto Service 57/1, Diamond Harbour Road, Iqbalpur, Kolkata – 700023 Gopal Traders IndiraNagar, Rekjoani, P.O.&P.S. Rajarhat, 24 Parganas (N), Kolkata – 700135 Lauhati Service Station P.O. Lauhati, 24 Parganas (N), Kolkata – 700135
Pin-743235 Basanta Bahar Service Station Vill. Hatishala, P.O. Dignagar, P.S. Kotwali, Dist. Nadia, 741401 Debnath Auto Fuel Service Debagram, NH-34, Dist. Nadia, Pin-741137 Pragati Service Station Raghunathpur, Kalyani, Dist. Nadia, Pin-741245 Nilachal Fuels Bahadurpur, P.S. Nadia Pin-741183
b) Secondary Data:
• • • •
The source of secondary data was the articles on the fuel and branded fuel mentioned on the internet. Research reports on Non Fuel Retailing Performance and strategy reports of petroleum companies. Articles on Non Fuel retailing and Branded Fuels, Loyalty Programs, Customer Retention Programs. White papers on non fuel retailing and Branded Fuels, Loyalty Programs, Customer Retention Programs. Newspaper articles and Online journals The sources of all the sites are mentioned in bibliography & under the subscript where ever it is used in this report.
Random sampling technique has been used, as the respondents are scattered all over the Kolkata region & the population of respondents are homogeneous in nature.
technique: A method of
sampling, which involves the division of a population into smaller groups, known as strata. In stratified random sampling, the strata are formed based on their members sharing a specific attribute or characteristic. A random sample from each stratum is taken, in a
Page | 31
number proportional to the stratum's size when compared to the population. These subsets of the strata are then pooled to form a random sample. Trend Analysis Technique: An aspect of technical analysis that tries to predict the future movement of a stock based on past data. Trend analysis is based on the idea that what has happened in the past gives traders an idea of what will happen in the future. There are three main types of trends: short-, intermediate- and longterm. Interval Scale Technique: It is an interval scale because it is assumed to have equidistant points between each of the scale elements. This means that we can interpret differences in the distance along the scale. We contrast this to an ordinal scale where we can only talk about differences in order, not differences in the degree of order.
Area Kolkata City Highways Taxi Miscellaneous Total Sample Size 300 300 50 100 750
This Research is Descriptive one. The topic characterizes following things: 1. Information needed is defined only loosely. 2. Research process is structured but flexible. 3. Sample is not very huge and not completely representative. 4. Analysis of secondary data is qualitative.
Page | 32
The major part of the research is an exploratory research design. Some portions follow the descriptive design criteria. This type of research design is generally followed by further exploratory or conclusive research.
Limitation of the Research:
There were few limitations in this research work. The sample covers all the major portions of Kolkata and its outskirts, but still it was not able to cover the full width of Kolkata. This limitation is because of the time span. So, there is a much broader need to increase the sample size to get more results. Also the secondary data on fuel and branded fuel and all other components, available on internet is not sufficient. There is no where mentioning of % wise market share of fuel in Kolkata in regards to branded fuel and others. This data was needed to check the % error in the report. So, error in report cannot be reported which is a big limitation of the given analysis. One of the limitations was that, I was the only person involved in reporting the data. Therefore, asking of same question from so many people can register some error in reporting the data which is called human error.
Page | 33
Page | 34
The petroleum industry includes the global processes of exploration, extraction, refining, transporting (often by oil tankers and pipelines), and marketing petroleum products. The largest volume products of the industry are fuel oil and gasoline (petrol). Petroleum is also the raw material for many chemical products, including pharmaceuticals, solvents, fertilizers, pesticides, and plastics. The industry is usually divided into three major
Page | 35
components: upstream, midstream and downstream. Midstream operations are usually included in the downstream category. Petroleum is vital to many industries, and is of importance to the maintenance of industrial civilization itself, and thus is a critical concern for many nations. Oil accounts for a large percentage of the world’s energy consumption, ranging from a low of 32% for Europe and Asia, up to a high of 53% for the Middle East. Other geographic regions’ consumption patterns are as follows: South and Central America (44%), Africa (41%), and North America (40%). The world consumes 30 billion barrels (4.8 km³) of oil per year, with developed nations being the largest consumers. The United States consumed 25% of the oil produced in 2009. The production, distribution, refining and retailing of petroleum taken as a whole represents the world's largest industry in terms of dollar value. Over the years India Petroleum Industry has played an influential part in triggering the speedy expansion of the country's economy by contributing 15% in the total GDP. Further to this, petroleum exports gave new dimension to foreign exchange earnings by drawing US$ 23.64 billion in the FY 2008-09. To assist and acknowledge the Committee on Economic Affairs blocks on November 2008 under the (NELP-VII). expansion of the sector, the Cabinet felicitated 44 petroleum research New Exploration Licensing Policy
Evolution of Oil and Gas Industry in India:
At Independence, India's domestic oil production was just 250,000 tonne per annum. The entire production was from one state-Assam. Most foreign experts had written off India as far as discovery of new petroleum reserves was concerned. The Government announced, under Industrial Policy Resolution, 1954, that petroleum would be the core sector industry.
Petroleum exploration & production was controlled by the Governmentowned National Oil Companies (NOCs), ONGC and OIL, in pursuance of the Industrial Policy Resolution, 1954. In the early 70s, they supplied nearly 70% of the domestic requirement. However, by the end of the 80s, they had
Page | 36
reached the stage of diminishing returns. Oil production had begun to decline whereas there was a steady increase in consumption and today the two NOCs are able to meet only about 35% of the domestic requirement. This was further compounded by the resource crunch in the beginning of the 90s. The Government had no money (FE) to give to the NOCs for the development of some of the then newly discovered fields. While some of these fields could be developed by ONGC (Gandhar, Neelam, Bombay High, Lakwa, Heera, Geleki etc.), for others there was no money available for indigenously developing the fields. The problem had elements such as the administered oil price, non-availability of appropriate technology, logistics etc.
Petroleum Sector Reforms, 1990:
The Government launched the Petroleum Sector Reforms (PSR) in 1990. Till then, three rounds of exploration bidding had been gone through with no success in finding new oil/gas deposits by the foreign companies who only were allowed to bid. Under the PSR, the Fourth, Fifth, Sixth, Seventh and Eighth Rounds of exploration bidding were announced between 1991 and 1994. For the first time Indian companies with or without previous experience in E&P activities were permitted to bid starting with the Fourth Round. The Government then announced the Joint Venture Exploration Program in 1995. The exploration blocks were in those areas for which the Petroleum Exploration License was with the NOCs and they were required to have a 25% to 40% Participating Interest from day one.
Foreign Companies in Exploration in India:
Foreign companies entered the Indian E&P scene since early fifties (Indo Stanvac Project- A Joint Venture between Government of India and Standard Vacuum oil Company for West Bengal on land in early fifties, Carlsbons Natomas for Bengal offshore in early seventies, Assamerc for Cauvery offshore and Reading and bates for Kutch offshore also in early seventies and later since the first round in 1980; Shell for Kerala offshore and Chevronn- Texaco in Krishna - Godavery Offshore). This was certainly not as much as elsewhere in the world.
Indian E&P Companies:
Most of the Indian companies barring HOEC have been riding piggyback on the foreign companies for exploration and development ventures in India. In this regard, Reliance Petroleum Ltd. has taken the first step by joining up with ONGC in bidding for exploration as well as development ventures in India and abroad. Some of the downstream companies like IOC; GAIL has entered also upstream in consort with ONGC and OIL.
Page | 37
Opening of the Oil/Gas Fields for Development by Private Companies:
The Indian oil/gas fields discovered by the two NOCs were first offered in 1992 under the First Offer. The second such offer was made in 1993. Development of fields is characterized by a comparative lack of business risk but is a cost intensive venture. Only those companies who have previous experience of field development can undertake such ventures. Unlike the Exploration blocks, field development contracts have upfront payments to be made to the NOCs for past costs as well as in the form of signature bonus. At the stage of oil/gas production, companies are also required to make production bonus payments. Lack of previous experience forces the Indian companies to seek foreign partners not only to work as Operator but also to share costs. It would help Indian cause if the government were to introduce the practice of Pure Service Contract like in some of the other producing countries. Today 74 Exploration Contracts and 28 Development Contracts are in operation. There are a total of 103 PSCs in operation. This is a sizable number but unfortunately this is not made known to a large number of people/enterprises. The Development Contracts are likely to add about 150,000 barrels of oil per day (or about 7.5 MMT per year) and about 7 million cubic meters per day of gas production. In terms of money about 4 billion dollars are expected to be pumped into these ventures over the next 10 to 15 years.
Various Production Segments:
Refinery production: Refinery production in context of crude oil escalated from 156.11 MT in FY 2007-08 to 160.67 MT in FY 2008-09. Indian Oil Corporation Ltd is looking forward to elevate the capacity of its Haldia refinery and Panipat refinery plants to 7.5 million tones and 15 million tonne respectively in 2010.
Page | 38
Natural Gas Production: The natural gas production in 2008-09 increased from the previous year's 32.40 billion cubic meters tonne (BCM) to 32.84 BCM. In 2009 alone the Natural gas production was registered at 33,846 million cubic meters. Crude Oil Production: The projected production of crude oil during the 11th Five-Year Plan (2007-2012) is 206.76 MMT, while that of natural gas is 255.27 BCM. Cumulative production of crude oil between AprilDecember 2009 was 25,152 MT, while cumulative production of refinery production during the same period was 119,283 MT.
India as an International Refining Destination:
India is steadily emerging as an international destination for oil refining with investment requirements lesser by 25% - 50% as compared to its Asian counterparts. As per the analysis carried out by Deutsche Bank, India is expected to enhance its refining competence by 45% in the next 5 years. Being the fifth biggest worldwide nation in context of distillation capacity, India enjoys 3% of the international capacity share. To move ahead in making its presence felt strongly in the global market, Indian petroleum firms are planning to raise their distillation capacity from the existing 149 mtpa to 243 mtpa by FY 2011-12.
Indian Petroleum Retail Market:
Expansion of Indian petroleum retail market is triggered by the growth in automobile sales that resulted in major foreign investments. The growth is estimated to sustain and the market is likely to expand further by 20 million every year till 2030, placing India at the world map in terms of being the biggest automobile market. Accordingly, the petroleum dealers Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Indian Oil Corporation in collaboration with each other are looking forward to add 2,262 petrol pumps in India by 2010.
Investments in India Petroleum Industry:
• In 2010 the state-owned oil firms are expected to splurge US$ 11.34 billion on developing supplies and constructing new shipping networks for petroleum and natural gas.
Page | 39
Indian Oil Corporation is looking forward to establish a petroleum plant in the state of West Bengal by bringing in investments worth US$ 596.63 million ONGC will bring in US$ 694 million for raising services at its oil fields in Assam and adjoining states to enhance the petroleum output. In addition it will also splurge US$ 5.65 billion on capital expenses in the next two years. GAIL (India) Limited and OVL, the international associate of leading oil and gas player ONGC, are expected to bring in investments worth US$ 250 million.
Future of Indian Petroleum Industry:
As per the latest CII-KPMG analysis, the energy industry of India will help tin the expansion of the petroleum sector by bringing in investments worth US$ 120 billion-US$ 150 billion in the next 3-5 years. By 2012, the prospects in India Petroleum Industry are estimated to accomplish US$ 35 billion to US$ 40.
Page | 40
Page | 41
Company Profile of Indian Oil Corporation Limited
Present Scenario: Indian Oil Corporation Ltd. is currently India's largest
company by sales with a turnover of Rs. 271,073 crores and profit of Rs. 10,220.55 crores for fiscal 2009-10. Consistently improving its position in the Fortune 'Global 500' listings, moving up 11 places, Indian Oil is ranked 105th in 2009, making it the highest ranked Indian company. It is also the 18th largest petroleum company in the world. Indian Oil’s vision is driven by a group of dynamic leaders who have made it a name to reckon with. In this section, you can peruse through the profile and spread of Indian Oil across the country & abroad. You can also know about Indian Oil’s current financial performance, special initiatives and causes along with the prestigious recognitions & awards that have come its way for exceptional performances.
Profile: Indian Oil Corporation Ltd., currently India's largest company by
sales with a turnover of Rs. 271,073 crores and profit of Rs. 10,220.55 crores for fiscal 2009-10, is also the highest ranked Indian company in the prestigious Fortune 'Global 500' listing, having moved up 11 places to the 105th position in 2009. India’s Flagship National Oil Company: Incorporated as Indian Oil Company Ltd. on 30th June, 1959, it was renamed as Indian Oil Corporation Ltd. on 1st September, 1964 following the merger of Indian Refineries Ltd. (established
Page | 42
1958) with it. Indian Oil and its subsidiaries account for approximately 48% petroleum products market share, 34% national refining capacity and 71% downstream sector pipelines capacity in India. For the year 2008-09, the Indian Oil group sold 62.6 million tonne of petroleum products, including 1.7 million tonne of natural gas, and exported 3.64 million tonne of petroleum products. The Indian Oil Group of companies owns and operates 10 of India's 20 refineries with a combined refining capacity of 60.2 million metric tonne per annum (MMTPA, .i.e. 1.2 million barrels per day). These include two refineries of subsidiary Chennai Petroleum Corporation Ltd. The Corporation's cross-country network of crude oil and product pipelines, spanning over 10,000 km and the largest in the country, meets the vital energy needs of the consumers in an efficient, economical and environmentfriendly manner. Indian Oil is investing Rs. 43,400 crores (US $10.8 billion) during the period 2007-12 in augmentation of refining and pipeline capacities, expansion of marketing infrastructure and product quality up gradation as well as in integration and diversification projects.
Network Beyond Compare:
As the flagship national oil company in the downstream sector, Indian Oil reaches precious petroleum products to millions of people every day through a countrywide network of about 35,000 sales points. They are backed for supplies by 167 bulk storage terminals and depots, 101 aviation fuel stations and 89 Indane (LPGas) bottling plants. Indane earned the coveted status of 'Superbrand' in 2009 and was poised to expand in the rural market through the Rajiv Gandhi Gramin LPG Vitarak Yojana. About 7,335 bulk consumer pumps are also in operation for the convenience of large consumers, ensuring products and inventory at their doorstep. Indian Oil operates the largest and the widest network of petrol & diesel stations in the country, numbering over 18,278. It reaches Indane cooking gas to the doorsteps of over 53 million households in nearly 2,700 markets through a network of about 5,000 Indane distributors. Indian Oil’s ISO-9002 certified Aviation Service commands over 63% market
Page | 43
share in aviation fuel business, meeting the fuel needs of domestic and international flag carriers, private airlines and the Indian Defence Services. The Corporation also enjoys a dominant share of the bulk consumer business, including that of railways, state transport undertakings, and industrial, agricultural and marine sectors.
Technology Solutions Provider:
Indian Oil’s world-class R&D Centre is perhaps Asia's finest. Besides pioneering work in lubricants formulation, refinery processes, pipeline transportation and alternative fuels, the Centre is also the nodal agency of the Indian hydrocarbon sector for ushering in Hydrogen fuel economy in the country. It has set up a commercial Hydrogen-CNG station at an Indian Oil retail outlet in New Delhi this year. The Centre holds 214 active patents, including 113 international patents. Indian Oil has joined the league of global technology providers last year with the selection of its in-house developed INDMAX technology (for maximizing LPGas yield) for the 4 MMTPA Fluidized Catalytic Cracking (FCC) units at the Corporation's upcoming 15 MMTPA grass roots refinery at Paradip in Orissa, as well as for the FCC unit coming up at BRPL. A wholly-owned subsidiary, Indian Oil Technologies Ltd., is engaged in commercializing the innovations and technologies developed by Indian Oil’s R&D Centre. The lubricant technology team endeavored to develop more energy efficient, environmental friendly and longer drain SERVO lubricants. Over 181 lubricant formulations were developed during the year of which 75% were commercialized.
At Indian Oil, customers always get the first priority. New initiatives are launched round-the-year for the convenience of the various customer segments. Exclusive XTRACARE petrol & diesel stations unveiled in select urban and semi-urban markets offer a range of value-added services to enhance customer delight and loyalty. Large format Swagat brand outlets cater to highway motorists, with multiple facilities such as food courts, first aid, rest rooms and dormitories, spare parts shops, etc. Specially formatted Kisan Seva Kendra outlets meet the diverse needs of the rural populace, offering a variety of products and services such as seeds, fertilisers, pesticides, farm equipment, medicines, and spare parts for trucks and tractors, tractor engine oils and pump set oils, besides auto fuels and kerosene.
Page | 44
SERVOXpress has been launched recently as a one-stop shop for auto care services. To safeguard the interest of the valuable customers, interventions like retail automation, vehicle tracking and marker systems have been introduced to ensure quality and quantity of petroleum products.
To achieve the next level of growth, Indian Oil is currently forging ahead on a well laid-out road map through vertical integration— upstream into oil exploration & production (E&P) and downstream into petrochemicals – and diversification into natural gas marketing, bio fuels, wind power projects, besides globalization of its downstream operations. Petrochemicals In petrochemicals, Indian Oil is envisaging an investment of Rs. 20,000 crores (US$ 4 billion) by the year 2011-12. Through the world’s largest single-train Linear Alkyl Benzene (LAB) plant with an annual capacity of 1,20,000 tonne set up at its Gujarat Refinery, the Corporation has already captured a significant market share of LAB in India, besides exporting the product to Indonesia, Turkey, Thailand, Vietnam, Norway and Oman. A world-scale Paraxylene/Purified Terephthalic Acid plant (annual capacities: PX - 3,63,000 tonnes, PTA – 5,53,000 tonnes) for polyester intermediates is already in operation at Panipat, while a Naphtha Cracker with a capacity of 800,000 tonnes of ethylene per annum, 6,00,000 TPA of Propylene, besides an annual production of 3,25,000 TPA of Mono Ethylene Glycol, 1,40,000 TPA of Butadiene, 6,50,000 TPA of Polyethylene and 6,00,000 TPA of Polypropylene, equipped with downstream polymer units is to be completed by December 2009 at Panipat. A grassroots refinery at Paradip is proposed to be completed by the year 2011-12, subsequently followed by the setting up of an integrated petrochemical plants with an estimated investment of Rs 12,000 crores (US$ 2.5 billion) which will further strengthen the Corporation’s presence in the sector.
Page | 45
During the year, LAB sales touched 126 TMT including the export of 19 TMT to 13 countries and over 30% growth achieved in PTA sales (535 TMT).
Oil Exploration & Production In E&P, Indian Oil has non-operator participating interest in seven oil & gas blocks awarded under various NELP (New Exploration Licensing Policy) rounds and two Coal Bed Methane blocks in India, in consortium with other companies. In addition, Indian Oil has two onshore type ‘S’ NELP blocks, with 100% participating interest (PI) and sole operatorship. It also has participating interest in an onshore block in Assam and Arunachal Pradesh through a farm-in. Overseas ventures of the Corporation includes two blocks (86 and 102/4) in Sirte Basin and Areas 95/96 in Ghadames basin of Libya, Farsi Exploration Block in Iran, onshore farm-in arrangements in one block in Gabon, one on land block in Nigeria, one deepwater offshore block in Timor-Leste and two onshore blocks in Yemen. In all, Indian Oil has 12 domestic exploration blocks, including 2 blocks where gas discoveries have been made and 9 overseas exploration blocks, & the Farsi block in Iran where commerciality of gas discovery has been established. Indian Oil has incorporated Ind-OIL Overseas Ltd. – a special purpose vehicle for acquisition of overseas E&P assets – in Port Louis, Mauritius, in consortium with Oil India Ltd. (OIL). A consortium of Repsol, Petronas, OVL, Indian Oil and OIL has been awarded a project for the development, extraction, up-gradation and marketing of heavy oil in Carabobo heavy oil region of Venezuela. Gas During 2009-10, Indian Oil sold 1.89 MMTPA of Natural Gas generating revenues of Rs. 2,989 crores. A technology innovation has been initiated to reach LNG (Liquefied Natural Gas) directly to the doorstep of bulk consumers in cryogenic containers for industrial as well as captive power applications. To consolidate its city gas distribution (CGD) business, Indian Oil has tied up with several players such as Adani Energy, Reliance Gas Corporation, OIL and ONGC, etc., to set up joint ventures in various cities of India. The
Page | 46
Corporation has also entered into franchise agreements with CGD players such as Indraprastha Gas Ltd., Mahanagar Gas Ltd., Adani Energy Limited, GEECL, SITI Energy and GSPC Gas Ltd. to market CNG through its retail outlets
Bio-fuels To straddle the complete bio-fuel value chain, Indian Oil formed a joint venture with the Chhattisgarh Renewable Development Authority (CREDA) with an equity holding of 74% and 26% respectively. Indian Oil CREDA Biofuels Ltd. has been formed for carrying out farming, cultivating, manufacturing, production and sale of biomass, bio-fuels and allied products and services. A pilot project of jatropha plantation on 600 hectares of revenue wasteland is underway in Jhabua district in Madhya Pradesh to ascertain the feasibility of revenue land-based commercial biodiesel units and to develop benchmarks for plantation costs and output. Indian Oil has also signed a MoU with M/s Ruchi Soya Industries Ltd. to take up contract farming on one lakh hectare of private and panchayat wasteland in the state of Uttar Pradesh. A MoU for collaborating on commercial production of biodiesel from algae has also been signed with PA LLC. Wind Energy Business IndianOil has forayed into wind energy business with the commissioning of a Rs. 130 crores, 21 MW wind power project in the Kutch district of Gujarat. The cumulative power generation from the 14 wind turbine generators has crossed 159 lakh KW since commissioning in January 2009. It has also commissioned two pilot solar lantern charging stations at its Kisan Seva Kendra at Sathla near Meerut and Chokoni near Bareilly. Consultancy For over two decades now, Indian Oil has been providing technical and manpower secondment services to overseas companies. Such services have been extended to Emirates National Oil Company (ENOC), Kenya Pipeline Company and Aden Refinery, Yemen. For the first time, SAP implementation / IT consultancy was provided in Sri Lanka. Consultancy on
Page | 47
pipelines was provided to Greater Nile Petroleum Operating Company (GNPOC), Sudan .The 2nd India-Africa Hydrocarbons Conference at New Delhi was jointly organized by MoP&NG, FICCI and Indian Oil. Kuwait Petroleum Corporation (KPC) selected Indian Oil as a training provider.
Indian Oil has set up subsidiaries in Sri Lanka, Mauritius and the United Arab Emirates (UAE), and is simultaneously scouting for new business opportunities in the energy markets of Asia and Africa. Lanka IOC Plc (LIOC) Lanka IOC Ltd. operates about 150 petrol & diesel stations in Sri Lanka, and has a very efficient lube marketing network. Its major facilities include an oil terminal at Trincomalee, Sri Lanka's largest petroleum storage facility and an 18,000 tonnes per annum capacity lubricants blending plant and state-ofthe-art fuels and lubricants testing laboratory at Trincomalee. Presently, it holds a market share of about 40%. In a highly competitive bunker market, catering to all types of bunker fuels and lubricants at all ports of Sri Lanka, viz., Colombo, Trincomalee and Galle. It is the major supplier of lubricants and greases to the three arms of the Defence services of Sri Lanka. LIOC's market share in petrol increased stands at 24.8% in 2008 with an overall market share of 16.9%. Indian Oil (Mauritius) Ltd. (IOML) Indian Oil (Mauritius) Ltd. has an overall market share of nearly 22% and commands a 35% market share in aviation fuelling business, apart from its bunkering business. It operates a modern petroleum bulk storage terminal at Mer Rouge port, besides 17 filling stations. In addition to the ongoing expansion of retail network, IOML has to its credit the first ISO-9001 producttesting laboratory in Mauritius. Overall sales grew by around 10% to 237 thousand kilolitres (KL) from 217 thousand KL last year to emerge with the third largest market share of 24.4% on a turnover of MUR 4.6 billion (INR 6.8 billion).IOML's market share touched a high of 41.9% and the company is the only one operating Retail Outlets round the clock. Indian Oil Middle-East FZE (IOME) The Corporation's UAE subsidiary, IOC Middle East FZE, which oversees business expansion in the Middle East, is mainly into blending and marketing
Page | 48
of SERVO lubricants and marketing of petroleum products in the Middle East, Africa and CIS countries. Finished lubes were exported to Oman, Qatar, Yemen, Bahrain, UAE and Nepal.
As a leading public sector enterprise of India, Indian Oil has successfully combined its corporate social responsibility agenda with its business offerings, meeting the energy needs of millions of people everyday across the length and breadth of the country, traversing a diversity of cultures, difficult terrains and harsh climatic conditions. The Corporation takes pride in its continuous investments in innovative technologies and solutions for sustainable energy flow and economic growth and in developing technoeconomically viable and environment-friendly products & services for the benefit of its consumers.
A major diversified, trans-national, integrated energy company, with national leadership and a strong environment conscience, playing a national role in oil security and public distribution.
To achieve international standards of excellence in all aspects of
energy and diversified business with focus on customer delight through value of products and services and cost reduction. To maximize creation of wealth, value and satisfaction for the stake holders. To attain leadership in developing, adopting and assimilating state-ofthe-art technology for competitive advantage. To provide technology and services through sustained research and development. To foster a culture of participation and innovation for employee growth and contribution. To cultivate high standards of business ethics and Total Quality Management for a strong corporate identity and brand equity. To help enrich the quality of life of the community and preserve ecological balance and heritage through a strong environment conscience.
Objectives and Obligations: Objectives:
Page | 49
To serve the national interests in oil and related sectors in accordance and consistent with Government policies. To ensure maintenance of continuous and smooth supplies of petroleum products by way of crude oil refining, transportation and marketing activities and to provide appropriate assistance to consumers to conserve and use petroleum products efficiently. To enhance the country's self-sufficiency in crude oil refining and build expertise in laying of crude oil and petroleum product pipelines. To further enhance marketing infrastructure and reseller network for providing assured service to customers throughout the country. To create a strong research&development base in refinery processes, product formulations, pipeline transportation and alternative fuels with a view to minimizing/eliminating imports and to have next generation products. To optimise utilisation of refining capacity and maximize distillate yield and gross refining margin. To maximise utilisation of the existing facilities for improving efficiency and increasing productivity. To minimise fuel consumption and hydrocarbon loss in refineries and stock loss in marketing operations to effect energy conservation. To earn a reasonable rate of return on investment. To avail of all viable opportunities, both national and global, arising out of the Government of India’s policy of liberalisation and reforms. To achieve higher growth through mergers, acquisitions, integration and diversification by harnessing new business opportunities in oil exploration&production, petrochemicals, natural gas and downstream opportunities overseas. To inculcate strong ‘core values’ among the employees and continuously update skill sets for full exploitation of the new business opportunities. To develop operational synergies with subsidiaries and joint ventures and continuously engage across the hydrocarbon value chain for the benefit of society at large.
• • •
• • • • • •
Towards customers and dealers:- To provide prompt, courteous and efficient service and quality products at competitive prices.
Page | 50
Towards suppliers:- To ensure prompt dealings with integrity, impartiality and courtesy and help promote ancillary industries. Towards employees:- To develop their capabilities and facilitate their advancement through appropriate training and career planning. To have fair dealings with recognised representatives of employees in pursuance of healthy industrial relations practices and sound personnel policies. Towards community:- To develop techno-economically viable and environment-friendly products. To maintain the highest standards in respect of safety, environment protection and occupational health at all production units. Towards Defence Services:- To maintain adequate supplies to Defence and other para-military services during normal as well as emergency situations.
Indian Oil: A National Brand
Indian Oil has been adjudged India's No. 1 brand by UK-based Brand Finance, an independent consultancy that deals with valuation of brands. It was also listed as India's 'Most Trusted Brand' in the 'Gasoline' category in a Readers' Digest - AC Nielsen survey. In addition, Indian Oil topped The Hindu Businessline's "India's Most Valuable Brands" list. However, the value of the Indian Oil brand is not just limited to its commercial role as an energy provider but straddles the entire value chain of gamut of exploration & production, refining, transportation & marketing, petrochemicals & natural gas and downstream marketing operations abroad. Indian Oil is a national brand owned by over a billion Indians and that is a priceless value. Due to innovative initiatives, strong brand communications and sales promotion campaigns conducted during the year, Indian Oil's branded fuels - XTRAPREMIUM petrol and XTRAMILE diesel - maintained their firm leadership status, with a market share of 48.6% and 59.6% respectively among branded fuels in the market. XTRAPREMIUM and XTRAMILE are now available at 6,446 and 9,256 retail outlets of Indian Oil respectively. Indian Oil is a heritage and iconic brand at one level and a contemporary, global brand at another level. While quality, reliability and service remains the core benefits to our customers, our stringent checks
Page | 51
are built into operating systems, at every level ensuring the trust of over a billion Indians over the last four decades.
Competitive Force Analysis:
Threat of Intense Segment Rivalry: It is witnessed in the holistic service offered by the retail outlet majors (IOCL, HPCL, and BPCL). If IOCL has “SWAGAT” Outlets, HPCL and BPCL has “Club HP” and “Ghar” Outlets. It is noted that most of these outlets have same facilities like Quality verification checks, Truck driver amenities, etc, and leading to intense segment rivalry. However, IOCL has the edge in terms of vast refining and distribution network hence is the market leader. Threat of New Entrants: In the current Indian scenario, entry and exit barriers are high and profit potential is high but firms face more risk because poorer performing firms stay in and fight it out. Like, IBP was facing bleak prospects till the time Indian Oil purchased it with a
Page | 52
premium of over 60%. Till the recent crude oil spike, Reliance Retail Petroleum, Essar Oil and Shell gave a head-on-clash with oil PSU’s. Adding to its newer plants come with better crude handling capacities (like better Nelson’s index) and therefore refinery margins are good thus reflected in the net margins. Threat of Substitute Products: Threat is from cleaner and efficient fuels like Compressed Natural Gas (CNG), where it was implemented on a war-footing in Delhi to control emissions. Also the increased awareness on Jatropa and Pongamia, Central Government’s encouragement in the form of Bio-fuel purchase policy for 5% bio-fuel blended Diesel. Electric Reva also poses a challenge to the existing players. Threat of Buyer’s growing Bargaining Power: “Consumer is always the king”-is apt in the case of petroleum products in India. Consumer’s interest is protected by the Government by not raising the fuel prices beyond a limit and indirectly consumer is exercising his bargaining power. Also all the Oil PSU’s are offered varied services to the consumer including intangible ones like frequent quality checks and tangible ones like amenities, ATM, car care, etc, which was not even a moot concept in the past. Hence the buyer’s bargaining power has increased. Threat of Supplier’s Bargaining Power: Petroleum is synonymous with OPEC cartel. Big-wigs like Exxon-Mobil, Total, Occidental Petroleum, IOCL, and BPCL are not shielded from the vagaries of Oil and Petroleum Energy Conservation. Though OPEC claims that it’s the tax structure in the respective countries which makes petroleum products expensive, crude oil price varies in NYMEX or in UK or in Singapore in accordance with production levels of Oil and Petroleum Energy Conservation. Today, world is gaining its spine power once again after the Global Meltdown, and crude oil prices, hence, are declining but Oil and Petroleum Energy Conservation has already initiated significant production cuts whose effect might be felt in the forthcoming months.
Page | 53
SWOT Analysis of Indian Oil Corporation Limited
∗ IOC controls 10 refineries, by virtue of which it has a total share of around 40% of India’s overall refining capacity. IOC has also acquired equity stakes in Cochin Petroleum Corporation Limited and Bongaigaon Refinery Pipeline Limited, and in 2001, these refineries became subsidiaries of IOC. 58% of IOC’s refining capacity is located in the Northern and Western regions, which are high demand and high growth areas. Although its refineries are located in the interior of the country, and not near the major ports, IOC has a very strong distribution network by virtue of having a share of 48% in the country’s product pipelines. The total capacity of these product pipelines is 49.79 Million Metric Tonne. IOC also acquired management control of the marketing company IBP, thereby strengthening its position in these activities. It also has a dominant share in all segments in terms of marketing infrastructure. Its network includes 18,278 retail outlets of petrol and diesel, 8000 LPG distributors, and 3963 kerosene/LDO dealers.
The major weakness for the company is the R&D. The company starts working on it. The petrochemical product development technology is another weakness for the company. The technological drawback, as compared to some major foreign player is another weakness for the company.
∗ Since the company has the maximum no. of outlets and also the maximum no. of refineries in India, it can very easily go for extension
Page | 54
at any point of time, and can introduce any new products, which will get support from its huge market network. The company can make the buying process easier for the customers, by implying many more schemes in the range of XTRAPOWER and XTRAREWARD. The company can think over the issue to build its own pipelines, so that it will be an independent player and it will also support its aviation fuel supply.
Foreign players with more advanced technologies are the biggest threat to the company. The crude oil supply is also a big issue in front of the company because the company cannot fix its price and so, sometime had operated in loss also. It is the biggest problem because the maximum part of their crude is been reported. In future the market will welcome more private players, which will eat up its market share. If the Govt. policies allow the private players to set their own price, the private player can seriously harm the market share of IOCL.
SWOT Analysis at a Glance
Strength ∗ ∗ ∗ PSU unit Vast refining and distribution network Diversified outlook ∗ ∗ ∗ ∗ Weakness PSU unit Upstream R&D Petrochemical development technology Old refineries leading to poor refinery margins Threat ∗ ∗ Volatility of Crude oil price Increased competition from private and foreign players
Opportunity ∗ ∗ ∗ To expand in South East Asia Can become an independent E&P player Expansion easily possible due to huge distribution network
Page | 55
Political – Legal Environment Entire oil industry is been governed by OIL Ministry and OIDB a Govt. body This two Institutes are responsible for all the decision related to the price, quality specification etc. Beside this the international politics also affect this international commodity “Oil” a lot and also its companies Any company operated in India had to work according to the norms and on the prices specified earlier by Govt. bodies Economic environment The gradual reduction of tariff protection has ensured that prices of most goods in countries like India are closer to global levels or even much lower. The lower prices are much more extensive in the services sector, which accounted for 52.4% of the Indian economy in 2004- 05.
The use of GDP based on purchasing power parity in the calculation of oil intensity is also validated by the fact that the figures on oil consumption are measured in terms of volumes of input (million tons of oil equivalent-mote) while the GDP estimated on the market
Page | 56
exchange rate gives only the value of output and not the actual volumes. It is only the GDP estimated on a purchasing power parity basis which gives some indicator so the volume of output which should form the basis of cross country comparisons of output and estimation of oil intensity therein. However, though the oil intensity in India is comparatively much lower than in most other developed and developing countries the negative impact of high oil prices on the economy is accentuated by the distorted pattern of oil consumption in India.
Social Cultural Environment Social cultural variation in the Indian context is very important for any company to work in it. The India is basically can be divided into four major regions on the basis of language, demography and also the income states. These are the south, north, east and west. The IOCL as a company also operates differently in different regions and also use different languages to attract people towards them. This is also, a reason for which the companies have three refineries in the south region out of eleven in total. And that also because of the merger with MRPL a local regional company Technological Environment Indian Oil has, till date, invested close to Rs. 1,000 crore in setting up world-class facilities at its R&D Centre and it plans to invest about Rs. 500 crore during the period 2007-12 to maintain its leadership in downstream R&D activities in the hydrocarbon sector. This the reason , that’s why IOCL have the India's first experimental HCNG (Hydrogen-Compressed Natural Gas) dispensing unit at the R&D Centre campus at Faridabad and has been in the forefront of
Page | 57
technology development for Bio-diesel production from various edible and non-edible oils and its application in vehicles. Pioneering studies by India Oil’s R&D Centre established that Biodiesel produced from Jatropha seeds were at par with that produced from vegetable oils.
4 P’s of Indian Oil Corporation Limited
Products • • • • • • • • • • Petrol Diesel LPG Auto LPG Aviation Turbine Fuel Lubricants Naphtha Bitumen Paraffin Kerosene •
Price Price for all the products of all company is decided by petroleum ministry. Very less difference in price of all PSU’s branded products. • •
Place Located all over India. Maximum number of refineries. Only company having retail outlet outside India (SriLanka) •
Promotion Subhiksha: Two ZOOP noodles packet free on purchase of Rs. 250/Dominos: Rs. 50/- off on each midsize dominos pizza. PVR cinema: Rs 10/- off on eatables purchased in PVR cinema. Rajdhani Thali: 10% off on each Rajdhani
Page | 58
Thali. Yoko Sizzlers: 10% off in Yoko Sizzlers AC Restaurants. 10 litres of fuel free on Power FM contest.
Page | 59
Page | 60
Major Competitors of Indian Oil Corporation Limited Bharat Petroleum Corporation Limited: Bharat Petroleum
Corporation Limited (BPCL) is one of India's largest PSU oil and gas companies, with Fortune Global 500 rank of 289 (2009). Its corporate office is located at Ballard Estate, Mumbai. As the name suggests, its interests are in downstream petroleum sector. It is involved in the refining and retailing of petroleum products. Bharat Petroleum is considered to be a pioneer in Indian petroleum industry with various path-breaking initiatives such as Pure for Sure campaign, Petro card, Fleet card etc.
Page | 61
BPCL's growth post-nationalisation (in 1976) has been phenomenal. One of the single digit Indian representatives in the Fortune 500 & Forbes 2000 listings, BPCL is often referred to as an “MNC in PSU garb”. It is considered a pioneer in marketing initiatives, and employs “Best in Class” practices. Offering World Class Fuels Since 2002, we have introduced new generation branded fuels Speed, Hi Speed Diesel and Speed 97, being the pioneers to introduce premium fuel brands in the Country. These specialized products we launched in line with global trends and keeping pace with the technological advancements in the automobile industry leading to introduction of new generation vehicles. Speed brand of petrol contains multi-functional fuel additives that prevent formation of harmful deposits and help clean existing deposits, thereby improving vehicle performance. Speed has been the market leader in the branded fuels category. BPCL has also introduced a high-end Octane 97 variant Speed 97 catering to the requirement of vehicles at the upper end of the tier. To meet the growing needs of the diesel passenger car segment, we introduced Hi-Speed Diesel which is a blend of diesel and world-class multi-functional additive which uses the internationally renowned Green Burn Combustion Technology. This multi-functional additive enables the high performance vehicles to deliver their designed outputs by removing harmful deposits from all fuel metering systems and components. This also reduces particle level, black smoke and provides longer engine life.
Making a Difference through Innovative Retailing At Bharat Petroleum we understand your needs as customers and relentlessly work towards fulfilling these needs. We have consciously worked towards providing added value to our customers in fuel and non-fuel areas. The Corporation offers products and services that have been designed to meet the need gaps of its customers. We have introduced several pioneering offerings in Indian Petroleum retailing scene. Servicing the Customers Need We recognized the customer need for pure quality and correct quantity of fuel for their vehicles and launched the flagship initiative of Pure For Sure (PFS) offering the guarantee of pure quality and correct quantity of fuel to
Page | 62
our customers. The petrol pumps displaying a prominent Pure For Sure signage have become landmark destinations as the movement has gained momentum across our Retail Network. We now offer a robust and automated network of retail outlets, which leverage technology to deliver the assurance of quality and quantity promise, ensure integration of payment with fueling and improves the service efficiency at the forecourt of the petrol pump. Fostering Loyalty We share rewarding relationships with our customers and building loyalty has been a center of focus with us. Recognizing the need of our customers to make life more convenient and rewarding and introduced the first loyalty-cumrewards program, PetroBonus. Equipped with Smart Card Technology, the Petro Card program combines convenience in payment along with an inbuilt rewards program that rewards the customer with Petromiles every time he fuels. A similar program, Smart Fleet was launched for Fleet Owners. The SmartFleet Programme offers the fleet owner an unbeatable convenience, security and a host of privileges such as cashless transactions, vehicle tracking, Credit Option for Fleet Owners and Cash Management System.
Delivering Convenience Bharat Petroleum has pioneered the concept of Convenience Stores in the Country. The In &Out Convenience Stores are the largest network of stores spread across the BPCL network, offering convenient timings and location for the motorists and neighboring localities. The offerings range from convenience products, ATMs, Money Transfer facilities, Courier services, Launderettes, Music, Greeting Cards, Bill Payments, Movies / Entertainment Tickets, etc. The network also has a good spread of Fast Food destinations throughout tie ups with Mc Donalds, Caf Coffee Day, Subway, Pizza Hut and other leading retail chains. Caring for your Vehicles Needs We also aim to provide service centre facilities through our V-CARE (Vehicle Care) Centres across the urban network. The V-Care Centres provide
Page | 63
customers with reliable, transparent and value for money services for the basic vehicle care needs. We have tie ups with Hero Honda and General Motors for being their authorized After Sales Service Centres apart from the other brands of cars and two-wheelers. With our reach to the nook & corner of the country we are always near to the customers. Partnering your Highway Journeys On the highways, we offer a home away from home to the truckers and the tourists in the form of the Generation Next OSTSs/OSTTSs (One Stop Truck cum Tourist Shop) branded as GHAR. These outlets are built on a minimum of 3 to 5 acres plot sizes and house dedicated and fully automated MS/HSD petrol/ diesel Fuelling facilities to fuel all kinds and sizes of vehicles besides the specially designed offerings for the highway travelers, that include a Food Court for Tourists and a Dhaba for truckers, a dormitory with beds, a Safe, Secured and Spacious parking for trucks and cars, a vehicle wash facility, Saloon, Laundry and Tailor shop, a Kirana shop, Bathing facilities, dedicated toilets for Truckers and dedicated toilets for Tourists (Gents, Ladies & Handicapped),Childrens Play area, Amphitheatre for entertainment, Health care centre, Smartfleet Customer service centre ,Sanjha Chula for self cooking and captive power generation. Assuring a network of outlets on the highway shows our commitment to serve our highway customers with as much care as in the key cities. AUTO LPG Introduction of LPG as Auto Fuel With the menace of rising vehicular pollution, use of LPG as an auto fuel was proposed as a pollution abatement measure. LPG being a clean environmentally friendly fuel will reduce air pollution to a great extent if the vehicles are fuelled with LPG. Bharat Petroleum was the first Oil Company to take the initiative for setting up of an Auto LPG Dispensing Station (ALDS) and run vehicles on LPG as a pilot project in Delhi in October 1999. We have today over 70 Auto LPG Dispensing Stations (ALDS) in various cities (including metros) in the country. CNG CNG (Compressed Natural Gas) is a mixture of hydrocarbons consisting of approximately 80 to 90 percent methane in gaseous form. Because of its low energy density, it is compressed to pressure of 200 to 250 Kg/cm2 (to enhance the vehicle on-board storage in a cylinder), hence the name
Page | 64
Compressed Natural Gas. Colourless, non-carcinogenic and non-toxic, CNG is inflammable and lighter than air. It is not a liquid fuel, and is not the same as LPG (Liquefied Petroleum Gas), which consists of propane and butane in liquid form. Superior to petrol, it operates at one-third the cost of conventional fuel and is hence, increasingly becoming popular with automobile owners. Commonly referred to as the green fuel because of its lead free characteristic, it reduces harmful emissions and is non-corrosive, thus enhancing the life of spark plugs. Another practical advantage observed in countries where CNG is in already in vogue is the extension of life of lubricating oils as the fuel does not contaminate and dilute the crankcase oil. In the next millennium, alternative fuels like Compressed Natural Gas (CNG) and Liquefied Petroleum Gas (LPG) would be increasingly used in automobiles. Mumbai already has over 10,500 private cars/taxis that run on CNG and in Delhi, all public transport runs on CNG. Car manufacturers have been conducting tests on their vehicles, using LPG/CNG - both in dedicated and bi-fuel modes. While these fuels will not totally replace petrol and diesel, they may be targeted for use in particular segments, like commercial and public transport vehicles. Diesel was for a long time considered eco-friendly because it is more fuelefficient than petrol i.e. 15-20 percent more mileage than one litre of petrol. But the 1990s have seen diesel being increasingly acknowledged as extremely detrimental to health and environment. Experiments have revealed that besides a very tiny - one micron or less, which are injurious to health. Recognizing the gravity of the situation, authorities are intensifying the thrust on use of alternate fuels like CNG and LPG which besides being less hazardous are cost-effective.
Hindustan Petroleum Corporation Limited:
HPCL is a Fortune 500 company, with an annual turnover of Rs. 1,16,428 Crores and sales/income from operations of Rs 1,31,802 Crores (US$ 25,618 Millions) during FY 2008-09, having about 20% Marketing share in India and a strong market infrastructure. Corresponding figures for FY 2007-08 are: Turnover of Rs 1,03,837 Crores and sales/income from Operations of Rs.1,12,098 Crores (US$ 25,142 Million). HPCL operates 2 major refineries producing a wide variety of petroleum fuels & specialties, one in Mumbai (West Coast) of 6.5 Million Metric Tonnes Per Annum (MMTPA) capacity and the other in Vishakapatnam, (East Coast) with a capacity of 7.5 MMTPA. HPCL holds an equity stake of 16.95% in Mangalore Refinery & Petrochemicals Limited, a state-of-the-art refinery at
Page | 65
Mangalore with a capacity of 9 MMTPA. In addition, HPCL is constructing a refinery at Bhatinda, in the state of Punjab, as a Joint venture with Mittal Energy Investments Pte. Ltd. HPCL also owns and operates the largest Lube Refinery in the country producing Lube Base Oils of international standards, with a capacity of 335 TMT. This Lube Refinery accounts for over 40% of the India's total Lube Base Oil production. HPCL's vast marketing network consists of 13 Zonal offices in major cities and 90 Regional Offices facilitated by a Supply & Distribution infrastructure comprising Terminals, Aviation Service Stations, LPG Bottling Plants, and Inland Relay Depots & Retail Outlets, Lube and LPG Distributorships. HPCL, over the years, has moved from strength to strength on all fronts. The refining capacity steadily increased from 5.5 MMTPA in 1984/85 to 13 MMTPA presently. On the financial front, the turnover grew from Rs. 2687 Crores in 1984-85 to an impressive Rs 1,16,428 Crores in FY 2008-09.
Reliance Petroleum Limited:
The Reliance Group, founded by Dhirubhai H. Ambani (1932-2002), is India's largest private sector enterprise, with businesses in the energy and materials value chain. Group's annual revenues are in excess of US$ 44 billion. The flagship company, Reliance Industries Limited, is a Fortune Global 500 company and is the largest private sector company in India. Backward vertical integration has been the cornerstone of the evolution and growth of Reliance. Starting with textiles in the late seventies, Reliance pursued a strategy of backward vertical integration - in polyester, fibre intermediates, plastics, petrochemicals, petroleum refining and oil and gas exploration and production - to be fully integrated along the materials and energy value chain. The Group's activities span exploration and production of oil and gas, petroleum refining and marketing, petrochemicals (polyester, fibre intermediates, plastics and chemicals), textiles, retail and special economic zones. Reliance enjoys global leadership in its businesses, being the largest polyester yarn and fibre producer in the world and among the top five to ten producers in the world in major petrochemical products. Major Group Companies are Reliance Industries Limited (including main subsidiary Reliance Retail Limited) and Reliance Industrial Infrastructure Limited
Page | 66
Essar Oil's assets include developmental rights in proven exploration blocks, a 10.5 mtpa refinery on the west coast of India and over 1,300 Essar-branded oil retail outlets across India. Plans are under way to increase its exploration acreage in various parts of the globe, expand its refinery capacity to 36 mtpa, and open 3,000 outlets countrywide. Our global portfolio of onshore and offshore oil and gas blocks, with about 70,000 sq km is available for exploration. We have over 300,000 bpd (barrels per day) of crude refining capacity that is being expanded to 750,000 bpd, with a goal to reach a global refining capacity of 1 million bpd. We have a 50 percent stake in Kenya Petroleum Refineries Ltd., which operates a refinery in Mombasa, Kenya, with a capacity of 80,000 bpd. Our Exploration and Production (E&P) business has participating interests in several hydrocarbon blocks for exploration and production of oil and gas. This includes the Ratna and R-Series blocks on Bombay High, and an E&P block in Mehsana, Gujarat, which has currently started commercial production. It has also been awarded a Coal Bed Methane (CBM) block at Raniganj in West Bengal, and two more E&P blocks in Assam, India. The overseas E&P assets include three onshore oil and gas blocks in Madagascar, Africa, and one offshore block each in Vietnam and Nigeria. We have a 10.5 mtpa refinery at Vadinar in Gujarat, which started commercial production on May 1, 2008. It has been built with state-of-theart technology and has the capability to produce petrol and diesel suitable for use in India as well as advanced international markets. It will also produce LPG, Naphtha, light diesel oil, Aviation Turbine Fuel (ATF) and kerosene. The refinery has been designed to handle a diverse range of crude — from sweet to sour and light to heavy. It is supported by an end-toend infrastructure setup including SBM (Single Buoy Mooring), crude oil tankage, water intake facilities, a captive power plant (currently 120 MW, being expanded to 1,010 MW), product jetty and dispatch facilities by both rail and road. The refinery is strategically located in Vadinar, a natural allweather, deep-draft port that can accommodate Very Large Crude Carriers (VLCCs). Vadinar also receives almost 70 percent of India’s crude imports. Post its expansion to 36 mtpa, the refinery will run at a Nelson Complexity of 12.8. This means it will be able to refine all varieties of crude, producing Euro 5 grade fuels. It will also be among the largest single location refineries in the world thus leveraging on economies of scale.
Page | 67
Essar Oil serves retail customers through a modern, countrywide network of over 1,000 retail outlets. We were the first private Indian company to enter petro retailing, looking beyond urban markets and reaching out to consumers in India’s heartland. We offer a wide range of products to bulk customers in the industrial and transport sectors. EOL has product off take and infrastructure sharing agreements with oil PSUs, namely Bharat Petroleum Corporation Ltd (BPCL), Hindustan Petroleum Corporation Ltd (HPCL) and Indian Oil Corporation (IOCL). We have received approvals to supply Aviation Turbine Fuel (ATF) to the Indian Armed Force.
Page | 68
The Customer Expectations and the Customer Satisfaction are the two twins which comes one after the other. When the Customer Expectations get fulfilled it adds to Customer Satisfaction. This Research has been done upon various types of wheelers owning customers both in Cities and Highways. The detailed analysis of the survey research is discussed below:
Stage 1: City Sample Collected from IOCL Retail Outlets
Page | 69
Sample Summary a. Vehicle type percentage on Total vehicle sample collected Vehicle Type 2 Wheeler 4 Wheeler 6 Wheeler 10 Wheeler Total Number of Vehicle On road 56 207 18 19 300 Percentage 18.67% 69% 6% 6.33% 100%
b. Vehicle type percentage based on different expenditure per month for fueling Amount Less than Rs 500 Rs 500-Rs 1500 Rs 1500Rs3000 Above Rs 3000 Total 2 Wheeler
Analysis to find out Total Fuel Requirement of Vehicles in City
Page | 70
Figure 1: Pie Chart Showing the Total Fuel Requirement in City. Depiction from the Figure 1: The Pie chart above shows the total fuel requirement in city. The total sample customers were 300 and out of which the highest 63% lies within the range of above Rs. 3000. The next range followed is Rs. 1500 – Rs. 3000. If the above chart is plotted in an interval scale of 4, where 4 is of highest importance and 1 is of the lowest, then: 4 Above Rs.3000 (63%) 3 Rs.1500 Rs.3000 (20%) 2 Rs.500 – Rs.1500 (14.67%) 1 Less than Rs.500 (2.33%)
Inference: It is observed that the customers in city have a fuel requirement of above Rs. 3000 the most. Out of 300 sample customers, 63% fuels above Rs. 3000 per month which includes personal as well as commercial heavy vehicles. It is also observed from the survey that the heavy vehicles in commercial use have a requirement of nearly Rs. 10000 above per month. So, this group of customers seems to be important to Indian Oil and emphasis should be given on their expectations and finally on their retention.
Analysis to find out Total fuel requirement in city on Wheeler basis
Figure 2: Bar Graph showing percentage of customers lying in the fuel requirement range on the basis of type of vehicle used. Depiction of the Figure 2: Out of 300 customers, 18.67% is using 2 Wheelers, 69% is using 4 Wheelers, 6% is using 6 Wheelers and 6.33% is using 10 Wheelers. Amongst 2 Wheeler Customer, 8.67% lies in the range of Rs.500 – Rs.1500. Therefore for 2 Wheelers this range is the significant one and emphasis should be given on them with regards to their expectation. 4 Wheeler customers are found as the most potential as because they
Page | 71
constitute a major portion in the city vehicle with 69% and mostly lie between the range of above Rs.3000 with 48.33%. Inference: The most important group of customers is found to be the 4 wheeler owners in city lying in the range of above Rs.3000 with 48.33%. So, the most emphasis must be given on their expectations. The 4 wheeler customers are generally with a sound economical profile. Out of 207 4 wheelers, it was observed during the market research that 50% - 60% of the customers are having a deluxe car. This creates a room for customer pulling in regard to branded fuel. It also signifies that there is a great chance of earning extra revenues by providing non fuel services to the customers and by this IOCL can make the customer feel delighted.
Analysis to find out the Type of Fuel Used by Vehicles in City
Figure 3: Pie Chart showing the analysis of type of fuel used in City. Depiction of the Figure 3: The highest used fuel in city is the Unleaded Petrol with 40.67% and then follows HSD with 28.67%. The demand of branded fuel both for petrol and diesel is comparatively low with 18.67% and 12% respectively. If the above chart is plotted in an interval scale of 4, where 4 being the largest group and 1 is the smallest, then: 4 Unleaded Petrol (40.67%) 3 HSD (28.67%) 2 Xtra Premium (18.67%) 1 Xtra Mile (12%)
Inference: As the number of 4 wheelers is more in city, so the demand for petrol is higher than that of diesel. Most of the 4 wheelers are Petrol running. But the inference which can be drawn from the above chart is very crucial. Indian Oil being a Public Sector Undertaking Company, literally it does not have any regulation over price fixing. Therefore, it does not add much value to IOCL as far profit maximization is concern. To maximize the profit, IOCL need to focus much on the sale of the branded products like Xtra Mile and Xtra Premium. But from the above chart is clearly understood that the sale of Xtra Mile and Xtra Premium is comparatively very low and hence, chance to maximize profit slashes to a great extent. Strategies should be
Page | 72
made in such a way that pulls the customer from normal petrol and diesel to branded products.
Analysis to find out the type of fuel used in City by Different Wheelers
Figure 4: Bar Graph showing Wheeler based type of fuel used in City Depiction of the Figure 4: From the above graph it is observed that in case of 2 wheelers majority of 13.33% choose to use Unleaded Petrol and only 5.33% uses Xtra Premium. In case of 4 wheelers, Unleaded Petrol has a demand of 27.33% which is the highest. Inference: It can be concluded that the demand for Unleaded Petrol is the highest amongst the 2 wheelers and 4 wheelers. But quite an interesting demand has been noticed for Xtra Mile Diesel among 4 wheeler customers. It is observed from the data collected that customers having diesel cars has an increasing tendency to use Xtra Mile as compared to that of Xtra Premium. It may be because of the high price for Xtra Premium. Another important reason found for less demand of branded fuel is high price. Customers do not will to buy products of high price differences because they are not aware of the advantages of the branded fuels. Another sufficient reason is that the customers do not understand the basic differences between the normal products and branded products even after one or two uses where the fact is at least a car should run at least 1000 to 1500 km to feel the service at first use. This proves that there is lack of knowledge, awareness and information about the products. Some value added services and gifts should be provided to pull the customers to Branded Products.
Analysis to find out the factors on which 2 wheeler customers depends the most while choosing a Retail Outlet in a city market
Figure 5: Bar graph showing the factors which affect the choice of visiting a Retail Outlet for 2 Wheeler Customers. Depiction of Figure 5: It is observed that the 2 wheeler customers are mainly focused on the Quality and Quantity and Customer Service as well irrespective of their fuel requirement. The importance of Quality and
Page | 73
Quantity and Customer Service is equal in case of the entire 2 Wheeler Customers. Inference: Thus, it is inferred that Q&Q and Customer Service is equally important for the 2 Wheeler customers and as because the majority of the customers are lying between the range of Rs. 500 to Rs. 1500, so, the Q&Q and Customer Service should be world class to retain them.
Analysis to find out the factors on which 4 wheeler customers depend the most while choosing a Retail Outlet in a city market
Figure 6: Bar graph showing the factors which affect the choice of visiting a Retail Outlet for 4 Wheeler Customers. Depiction of Figure 6: It is observed that the 4 wheeler customers are mainly focused on the Quality and Quantity and Customer Service as well irrespective of their fuel requirement. The importance of Quality and Quantity comes first with 89.37% and Customer Service follows it with 81.64%. Inference: Thus, it is inferred that Q&Q and Customer Service is more or less of higher importance for the 4 Wheeler customers and as because the majority of the customers are lying between the range of above Rs.3000, so, the Q&Q and Customer Service should be world class to retain them.
Analysis to find out the factors on which heavy vehicle customers depend the most while choosing a Retail Outlet
Figure 7: Bar Graph to show the factors on which the heavy vehicle customers depend the most while choosing a Retail Outlet. Depiction of the Figure 7: The above Bar Graph shows that for heavy vehicle customers, the customer service is the factor which affects the choice of Retail Outlet. Next comes the Quality and Quantity which is also very important for the heavy vehicle customers. They prefer the Retail Outlet with good reputation of Quality and Quantity and above all they are experienced too to comment on this part.
Page | 74
Inference: Though the parking space and garage facility is a vital basis to choose a Retail outlet, but Customer Service and Quality and Quantity hits the list. The overall survey shows that how good your house keeping may be and what more extra facilities you may provide, but the basic expectation of the customers is all around basic customer service that includes excellent behavior of the sales person and good quality fuel and in accurate measurement.
Analysis to find out the most important factor for choosing a RO
Figure 8: Bar Graph showing the total analysis for the factors on which customers depend to choose a retail outlet in city market. Depiction of the Figure 8: On the whole customers in city market generally look for Retail Outlets with excellent reputation of providing quality products and in accurate quantity, i.e., these two factors are the primary need and basis to go to a retail outlet. Others facilities are secondary to the customers. Inference: It is true that if a coffee shop or an ice cream parlor could have been there in a Retail Outlet, the extra revenues could be earned. But that definitely does not fall under the basis for choosing a Retail Outlet. For vehicles parking space is an all time necessary facility but they do not think it as the primary need to visit a Retail Outlet. Irrespective of whatsoever facility is available in the RO, the most sought after privilege is the Q&Q and Customer Service to quite a large extent.
Analysis to find out the most sought after facility among 2 wheeler customers in city market
Figure 9: Bar Graph showing the percentage of customer responded for different tangible expectation in Retail Outlets. Depiction of the Figure 10: ATM has the highest respondent of 85.71% of 2 wheeler customers and washroom being the 2nd most important with 66.07%.
Page | 75
Inference: So, it can be concluded that in city retail outlets ATM has become a hot cake expectation amongst the 2 wheeler customers and they also expect for a neat and clean washroom. Note: Others comprise of expectations like Cold Drinking Water, Wind Screen Wash, Air Checking facility, Pollution Checking Centre, Ice Cream Parlours, Cafeteria, etc.
Analysis to find out the most sought after facility amongst 4 wheeler customers in city market
Figure 10: Bar Graph showing the extra facilities that 4 wheeler customers want the most. Depiction from Figure 10: Similar to the 2 wheeler, 4 wheeler customers has the most demand for ATM in Retail Outlets and next on the line a neat and tidy washrooms. Inference: As it is seen from the graph, except ATM and washroom other facilities are having a row clutching fight. Unlike others, ATM comes to be the most sought after facility which customers feel should be there in ROs.
Analysis to find out the most sought after facility amongst heavy vehicle customers in city market
Figure 11: Bar graph showing the demand of extra facilities among the 4 wheeler customers. Depiction of Figure 11: ATM, Washroom and Spare Parts shop is found to be the most demanded extra non fuel facilities among heavy vehicles running in city market. Restaurant and road side Dhaba seems to be another important factor for the heavy vehicle customers. Inference: It is very likely that the owners of heavy vehicle, generally does not drive the truck or bus. The drivers are the one who really understand the need of the road journeys. Therefore to facilitate this group of customer,
Page | 76
though in very small number yet profitable, IOCL should drag them into some loyalty programs and make necessary promotions. In city heavy vehicles are few but they are the potential customers because small cars take fuel in smaller quantity but heavy vehicles require fuel above 25000 on average per month. So, much more emphasis should be given on their need according to the site of the RO.
Analysis to find out the overall expectations of the facilities in city
Figure 12: Bar graph showing the overall expected non fuel services of the customer in city. Depiction of Figure 12: Overall ATM is the most sought after non fuel services among the customers in city. 78% of the customers need ATMs in ROs. Washrooms are also very important facility demanded by 64% customers. Inference: We should keep in mind that the majority customers in city are the small personal car users who really faces problem at times if ATM is not near and they are in need of fuel. Washroom is another very important facility which is made compulsory by IOCL but unfortunately very poorly managed. It is utmost necessary to see that the washrooms are neat and tidy.
Basic expectation of a customer from a Retail Outlet (2 wheeler)
Figure 13: Bar Graph showing the basic expectation of 2 Wheeler Customers in City.
Page | 77
Depiction from Figure 13: The 2 wheeler customer’s basic expectation hits the Customer Service with the maximum of 94.64% and it follows with Quality and Quantity at 89.29%. Inference: It is proved here that the 2 wheeler customers are mostly looking for Customer Service and Quality and Quantity. Though IOCL have a very good reputation for Q&Q, but has to do much with its Customer Service in ROs. In figure 2 it was observed that the basis of choosing a RO for 2 Wheeler Customers majorly confined to Q&Q and Customer Service and here for the basic expectation the scenario is almost similar.
Basic expectation of a customer from a Retail Outlet (4 wheeler)
Figure 14: Bar graph showing the basic expectations of the 4 wheeler customers in city. Depiction of Figure 14: In case of 4 wheeler Quality and Quantity seems to be the most important one. The basic expectation of the customers is Quality and Quantity with 88.41% and next the customer service with 85.99%. This little difference between Q&Q and Customer Service is very negligible. Inference: It can be make out very clearly that in city 4 wheelers are the major players and they should be look after very carefully by enhancing the customer service as far as possible. By giving good services promptly and giving the extra facilities as much as possible will retain the customer.
Basic expectation of heavy vehicle customers from a Retail Outlet
Page | 78
Figure 15: Bar graph showing the basic expectation of the heavy vehicle customers in city market. Depiction of Figure 15: Here in case of heavy vehicle customers, the customer service is their basic expectation. As the sample size of heavy vehicle customers is small in city market, it becomes very difficult to comment. But as far as the above chart is concern and with the help of trend analysis, it can be said that the basic expectation of these customers are nothing but customer service. Inference: Despite the no. of heavy vehicles are much lesser in cities as compared with highways, it is not advisable to neglect them and focus only on 4 wheeler customers. There are ROs in city where heavy vehicle customers do not go at all and there are ROs where a good no. of heavy vehicles goes per day. So, on the basis of the potential of the market where the RO is located, strategies should be made. We have to keep in mind that, 1 heavy vehicle customer approximately equals 3 small car customers, because their need is quite higher than 4 wheeler customers. Promotion of fleet card is needed in city. There is rarely a fleet card user in city. There should be absolutely excellent customer service in city ROs for the customers irrespective of the type. There are complains where it is said that wind screen wipe is only meant for small cars but not for heavy vehicles, where in fact it’s not true. Gifts are only given to the small car customers not to the heavy vehicles. These imbalances should be scrutinized minutely and necessary actions should be taken. The dealer should be made aware that these services, if found to be not provided will be a violation of the rules and decorum of the company. They should be made aware that these services will enhance their sale and reputation of the RO.
Analysis to understand the overall expectation of the customers in city
Figure 16: Bar Graph showing the overall expectations of the city customers. Depiction of Figure 16: The overall scenario of the city says that the customer service is the most expected among the city customers where as the quality and quantity is also found to be an important one. The difference between the both is very negligible because the sample size was not too big. As such quality and quantity and customer service proves to be the basic expected factors in city customers.
Page | 79
Inference: It is to keep in mind that millions of loyalty programs will not prove worthy if the basic expectations of the customers are not met. It is of prime importance that each RO in city should be with world class customer services. The customer service is a wide area to deal with. It comprises of neat and clean washrooms, providing cold drinking water, wind screen wipe and a sophisticated, polite behavior of the staffs. IOCL has many loyalty programs like co-branded cards, fleet card, Xtra rewards, easy fuel, etc but the basic need to pull the customers into a loyalty program is to meet their basic expectation. Because if their expectations are fulfilled, then only they will be agreeable to become a loyal customer. IOCL should deal with their dealers accordingly. Dealers are the bridge between the company and the end user. So, they need to be loyal to the company.
To find out the Brand Awareness amongst the Customers in City
Figure 17: Pie Chart showing percentage of Customers who knew about Branded fuels. Depiction of Figure 17: 76% of the total customers knew about branded fuel but only 49.33% is using it. 24% is unaware of the branded products. Inference: There are 24% customers who are not at all aware of the branded fuel and 26.67% of the customers knew but does not use it. In the survey I tried to find out the reason for not using the branded products. The majority was due to high price. So, it is understood that two necessary things has to be done by Indian Oil: 1. Make extensive promotions and awareness programs to promote branded fuels, such as advertising in TV, Radio FMs, Print Media, Brand Ambassadors, Conducting some social Rallies, tie ups with some reputed brands like Reebok, Nike, Pantaloons, West Side, etc. 2. To pull the non users by giving gifts for purchasing branded products, lucky draw coupons, providing a new type of loyalty card exclusively for branded fuel users, etc.
Page | 80
Testing the Loyalty among the City Customers
Figure 18: Pie Chart showing the percentage of loyal customer in City Depiction of Figure 18: In city, more than half of the total customers are flying customer. Only 4.67% tends to be the loyal customer and 2% wants to be in a loyalty program. 38.67% of the customers are permanent. Inference: As the number of RO is large in city, so the availability to the customer is more. The customers are of changing nature in city because they generally visit to the RO as per their convenience. There is a tendency in customers to visit to a RO which is near to their place. There are many customers too who does not even know on which company RO they are standing. They also fuel their vehicle as per their necessity. So, it is an immense opportunity for Indian Oil to make these customers aware and pull them to their ROs permanently. As the no. of heavy vehicles is less in city, the chance of getting loyal customer diminishes. But Indian Oil must come up with some new strategies for middle class people who can be a part of the loyalty programs. The Citi Bank Co-branded card is for those people who are above middle class because survey says that account with Citi Bank is majority in hi profile customers. To pull the middle class customers into loyalty program IOCL should tie up with SBI or AXIS bank for Co-branded card which is easily available to this group of customers. It was also found that the permanent customers are the very middle class person who does not have an account with citi bank or so but are willing to be a part of the loyalty programs. After the city analysis done with the samples collected from different retail outlets of Indian Oil, now it’s time to collect some open views from some commercial segment of customers like Taxi Drivers Association, Public Bus Terminus and Transport Truck Terminus.
Stage 2: City Sample Collected from Taxi Drivers Association
Total Sample 50 IOCL Customer 16 BPCL Customer 22 HPCL Customer 12
Page | 81
Preferred Petrol Pump in City among Taxi Drivers
Figure 1: Pie Chart showing the preference for the oil company for fuelling amongst the Taxi Drivers. Depiction of Figure 1: It is observed that the Taxi Drivers mostly prefer the Bharat Petroleum (44%) Retail Outlets rather than any other. Indian Oil is just behind BPCL in the preference with 32%. Inference: The taxi drivers prefer to go to BPCL outlets rather than any others. This may probably because of the customer service. BPCL is quite ahead in customer service and promotional marketing. IOCL has to come up with equally good customer service rather with much more refined, new, and better one.
Analysis to find out the reasons for the choice of Retail Outlet
Figure 2: Pie chart showing the reasons for the preference of RO. Depiction of Figure 2: The pie chart shows that 28% of the customers prefer the RO because of good service, 24% because of loyalty program, and so on. Inference: Customer Service is nothing but a series of activities designed to enhance the level of customer satisfaction i.e., the feeling that a product or service has met the customer expectation. To enhance the Customer Service IOCL should train the Retail Dealers and the staffs. The following are some suggestions which IOCL may follow for RO staffs grooming: Know your product – Let them know the importance of products they are offering back to front. In other words be an information expert. It is okay to say "I don't know", but it should always be followed up by "but let me find out" or possibly” but my friend knows!" Whatever the situation may be, make sure that they don't leave the customer with an unanswered question.
Page | 82
It has been observed that the sales personnel do not have much information about the facilities available in the RO like, whether Debit card is accepted or not, etc. Body Language and Communication – Most of the communication that we relay to others is done through body language. If we have a negative body language when we interact with others it can show our lack of care. Two of the most important parts of positive body language are smiling, and eye contact. Make sure that they look to the customers with an eye contact. It shows that we are listening to them, not at them. And then of course smiling is just more inviting than someone who has a blank look on their face. It has been found that the sales personnel are very reluctant and lazy type with a neglecting attitude. The politeness, humbleness and always ready to help attitude can work miracles. Big players go for many loyalty programs and much more marketing gimmicks for retaining the customers, but the main “mantra” for customer retention follows under creating a relationship with the customer. Loyalty program may fetch customers for some time span but excellent relationship marketing will create a relationship for life long. Anticipate Guest Needs - Nothing surprises your customer more than an employee going the extra mile to help them. Always look for ways to serve your customer more than they expect. In doing so it helps them to know that you care and it will leave them with the "Feel Good Factor" that they are searching for. Make them feel that you are always at their service. Do not stop at customer satisfaction, go beyond customer delight. While fuelling give the customer a pen and paper and ask him to fill up a customer service feedback form and insist him to put his birthday, anniversary date. By maintaining this data, send him a card on his birthday or a message wishing him. This will create a beautiful lifetime relationship.
Page | 83
Analysis to Find out the Branded Fuel User
Figure 3: Pie Chart showing the % of Taxi Drivers using Branded Fuel.
Figure 4: Pie chart showing the reasons for not using Branded Fuel.
Depiction of Figure 3: It shows that Depiction of Figure 4: It shows that only 40% of the customers are using out of 30 non user of branded fuel, branded fuel and rest 60% are not. 56.67% does not use it because of high price. Inference: The reason need to be found out for low rate of using branded fuel. Inference: It can be said that a vital reason for not using the branded fuel is high price. IOCL must follow extensive promotions and advertisements demonstrating its advantages and benefits.
When it comes to name brand items everyone knows that you can save a lot of money by getting the store brand and the less popular name brand of just about anything on the shelf. Many people don't bother buying them because they feel that the name brands are the only ones that really work. Everyday we are bombarded with tons of commercials that advertise just about everything you can think of. In a way they are actually programming people to buy the more expensive brand items. Of course when we think of television actually programming someone we usually think that our children are a lot more susceptible than we ourselves are. I decided to ask several people in my area if they buy more name brand products or if they buy more of the so called knock off products. I was not surprised to find that the majority of people I spoke with will buy the name brand products just because they think it works better. When I asked why they felt it would work better many of them would say that they guess it's because the commercial makes it looks appealing to them. You have got to admit that it really is a great way to get people interested in your product and to make people want to actually purchase it.
Page | 84
City Sample Collected from Bus Terminus and Truck Terminus
Total Sample 100 IOCL Customer 23 BPCL Customer 51 HPCL Customer 26
Preferred Petrol Pump in City among Bus and Truck Owners
Figure 1: Pie chart showing the percentage of preferred petrol pumps by bus and truck owners. Depiction of Figure 1: It is depicted in the chart that 51% of the customers prefer Bharat Petroleum, 27% of the customers prefer Indian Oil and 22% of the customers prefer Hindustan Petroleum. Inference: As was in the case of Taxi, the same scenario repeats here again. The customers prefer Bharat Petroleum much than any others that may be because of the good customer service and other facilities available. To find out the real scenario behind this ratio, it is firstly need to be understood, what is the reason for going to this RO rather than Indian Oil.
Analysis to find out the reasons for the choice of Retail Outlet
Figure 2: Pie chart showing the reasons for preference of RO. Depiction of Figure 2: 35% of the customers prefer the chosen ROs because of good Service, 32% because of Loyalty Programs, etc. Inference: “The quality of our work depends on the quality of our people.” This
great saying is very true. Our people are responsible for each good customer and no customers as well. If we don’t care of our customers someone else will do. That is what is happening. Bharat Petroleum has taken our weaknesses as their opportunity to serve the customers better. None can have a product or price advantage. They can be easily duplicated and copied, but a strong customer service culture can never be copied. Page | 85
We all know the story... it costs 5 times as much to bring in a new customer, than to keep an existing one. When people become your customer, they want to be loyal. So, why do they leave? Most of the time, they leave because of small oversights and lack of attention to plain, old customer service. It is of immense importance for Indian Oil that they take good care of their dealers and in return make them understand that customer service is something which is priceless. The benefit and reward of excellent customer service can be recognized. Indian oil has many opportunities over others, but only a good customer service with some added facility can fetch them great success.
Stage 4: Highway Samples Collected from IOCL Retail Outlets
The highway Retail Outlets covered has totally different characteristics from City outlets. The 4 wheelers and 2 wheelers are the major customers in city but in highways the major customers are 4 wheeler (heavy vehicle), 6 wheeler, 10 wheeler and 14 wheelers. Type of wheeler 4 wheeler 6 wheeler 10 wheeler 14 wheeler Total No. of Vehicles 42 202 49 7 300 Percentage 14% 67.33% 16.33% 2.33% 100%
Analysis to find out the mode of payments by the customers on highways
Page | 86
Figure 1: Pie Chart showing the mode of payments by the customers on highways. Depiction of Figure 1: Majority of 61.33% customer uses fleet cards as their payment options. Only 38.67% does not use any card and pay in cash. Inference: It can be clearly stated that 61.33% are loyal customers on highways and majority of the cash payers are permanent customers but some wish to enroll in loyalty program available and some other finds this loyalty program not so suitable for them.
Analysis to find out the reason for using fleet card as their payment option
Figure 2: Bar Graph showing the reasons for using the fleet cards as the payment option Depiction of Figure 2: The graph shows that the customers prefer fleet card mostly because of safety. Rewards and other facilities are of secondary importance to them. Inference: The graph again shows that the customers are not dependent on getting gifts. Their primary importance is the road safety that is why the maximum customers prefer the reason “no need to carry cash”. The heavy vehicles which run 100s and 1000s Kilometers, the road robberies and thefts are real threat to them. That is why they prefer to use the fleet card. Safety is the major concern for the customers. Secondarily, they accept the extra facilities available with it. But it is also found that the system of fleet card transaction is not user friendly. Many a times a common problem has been found of server. IOCL should look into these matters very crucially because the customers are loyal and once they get disappoint then it would be a very hard job to pull them again.
Analysis to find out the overall fuel requirement on highways by heavy vehicles
Figure 3: Pie chart showing the demand of fuel on highways
Page | 87
Depiction of Figure 3: 59% of the customers has a demand of fuel of above Rs. 40000 per month, 24.33% have a demand of Rs. 25000 – Rs.40000 per month. Inference: It can be said that the customers on highways are more often potential customers with high demand for fuel. If these customers can be retained in IOCL, a good business could come out of it. It should be in the mind of the staffs and the dealers that these customers are potent customers and they are the basic business sources of IOCL. These customers should be treated well. Many ROs have a tendency that the heavy vehicles are driven by the drivers and owner very rarely comes, so as the drivers are not so up to the class person, the RO staffs do not treat them well. Here the problem lies. The driver is the bridge between owner and the RO. If we behave well and treat him well one day, he will insist his owner to be a permanent customer of this RO. Not only this, he may also spread the good words to different other drivers and they may come to your outlet. Never miss an opportunity to satisfy a single customer.
Analysis to find the most used fuel by heavy vehicles on highways
Figure 4: Pie Chart showing the analysis of type of fuel mostly used by vehicles on highways. Depiction of Figure 4: It has been observed that majority of the heavy vehicles on highways mainly prefer HSD (normal Diesel). A concrete reason behind this may be because of the vehicles incapability to support the branded fuels. Mainly the old heavy vehicles which are 2005-2006 made engine generally do not support branded fuel. The service centers also recommend these old engine vehicles to use normal fuel. So, this may be a cause for this high percentage of 87.33% for type of fuel used. Few new 4 wheelers like TATA 407, 409, and other goods carriage vehicles do use branded diesel. The sale of petrol and branded petrol is very less because the no. of petrol cars on highways are rare.
Page | 88
Inference: At this point of time, the no. of old heavy vehicles is much more in no. than that of new ones. It is very important that these vehicles are treated very well and can be converted into loyal customers if not. The new heavy vehicles coming to the RO should be treated specially because they may be retained by some loyalty programs and can be promoted to use the branded diesel, Xtra Mile. We need to demonstrate and make them understand the advantages of using Xtra Mile.
Analysis to find out the basis of choosing a RO by vehicles running on Highways
Figure 5: Bar graph showing the factors upon which highway customers mostly depends for choosing a RO. Depiction of Figure 5: The Bar Graph shows that the basis of choosing a RO is depending upon Quality and Quantity to the maximum of 90.67% and Customer Service to 83.33%. Inference: It can be inferred that the customers come to a RO on the basis of the fuel quality and its measurement accuracy. They also give customer service almost an equal importance. It is a common complaint from the drivers and the owners on highways that they are not treated equally well as that of the small cars. It should be kept in mind that these heavy vehicles are the major loyal and can be loyal customers, not the small cars on highways. On the basis of that we should be much focused on the needs and expectations of the heavy vehicles customers. Along with quality products and good customer service, few more necessary facilities should be provided to them like Dhaba, PCO, Cold Drinking water and Neat and Clean washrooms.
Basic Expectations of the Highway Customers from the Retail Outlet
Page | 89
Figure 6: Bar Graph showing the basic expectations of the highway customers. Depiction of Figure 6: The basic expectations of the highway customers are all concentrated along Customer Service and Q&Q. This proves that besides all the non fuel services and expectations, the main reason for choosing a RO is Q&Q and Customer Service. 94% of the customers expect customer service and 93% of the customer expects Quality and Quantity. Inference: The needs, wants, and preconceived ideas of a customer about a product or service are the customer expectation. Customer expectation will be influenced by a customer's perception of the product or service and can be created by previous experience, advertising, hearsay, awareness of competitors, and brand image. The level of customer service is also a factor, and a customer might expect to encounter efficiency, helpfulness, reliability, confidence in the staff, and a personal interest in his or her patronage. If customer expectations are met, then customer satisfaction results.
Extra Facilities that a Highway Customer wants in a Retail Out
Figure 6: Bar Graph showing the most wanted extra facilities by highway customers. Depiction of Figure 6: On highways, among 300 customers 66.33% wants neat and clean washrooms and 63.67% customer wants spare part shop in outlets. Inference: As Indian Oil has tied up with Future Group to set up SERVOXpress shops, the SERVOXpress outlets will offer services such as battery/oil check, oil and coolant change, tyre pressure check, A/C service, vacuum cleaning, perfuming, upholstery cleaning and polishing. But along with all these strategies, the basic commodities which a customer wants should be taken into consideration. Indian Oil is making lots of strategies for customer retention, satisfying customer and providing them non fuel
Page | 90
benefits too by setting many big brand shops, convenience stores, etc. But the basic amenities which are there in the RO, those should be provided to the customer first in absolute manner. It has been noticed while the survey that these basic amenities like Washrooms, Cold Drinking Water, Air Checking, etc., are not in proper usable conditions. We should keep in mind that the city or the metropolis is not the only potential market. Highway covers a major portion of the country and majority of the RO are situated on highway. So, we should give emphasis on the highway customers.
Page | 91
Non Fuel Retailing Till a few years ago, petroleum retailing in India was a staid and dreary business. Cars, buses and two wheelers drove in, got the vehicles fuelled, paid cash, and drove out. The environment started changing when Shell did a makeover of some petrol pumps as part of the economic reform process. Improved signage, use of credit cards, and car washes soon became an integral part of the petroleum retail outlets. Earlier petrol stations were merely used for selling fuel; now they are quickly getting converted into multi-facility joints. The idea, common enough in countries like Singapore and Malaysia —is to buy fuel, and shop alongside. However, these pumps are either owned by state-owned petroleum product companies like Indian oil, Bharat Petroleum and Hindustan Petroleum or are run as franchises by private entrepreneurs with limited capital. Indian Petroleum Industry has been witnessing a steady growth but the margin pressure has increased. There has been a steady growth of 2.8% in the last five years (2002-07). The desired impetus would be provided by enhanced economic activity. To overcome margin pressure, Indian PSU Oil companies have started their Non Fuel Effort, similar to their global counterparts. Even losses of over Rs 300 crore (Rs 3 billion) per day from selling automobile fuels have not stopped government-owned oil marketing companies from expanding their retail network across the country. The three government-owned companies -- Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) -- are together planning to expand their non fuel business on existing outlets and provide the same on existing outlets to boost profitability. The marketing businesses of oil retailers are suffering losses as they are forced to sell petrol, diesel, LPG and kerosene at
Page | 92
subsidized prices. Demand for these products is growing at a healthy rate of about 8 per cent per year. It is perhaps a blessing in disguise. In last few years, opportunities in petro retailing have risen in two key areas: • Sale of Value Added Fuels – Branded Fuels • Value added products and services – Non Fuel products and services
India as a Non Fuel Retailing Destination The Indian Petro retailing industry is now poised to make huge tread both in terms of new forecourt retailing opportunities and better offerings for the customer at the retail outlet. With the onset of the deregulated scenario, the character of competitiveness among the petroleum companies augur well for the consumer with each of the companies espousing innovative ways to capture larger part of the consumer’s mind. The emergence of organized retailing and a growing demand from consumers for a superior shopping experience has made Convenience Retailing a key business area for petroleum companies due to their wider presence at strategically located sites and the existing mammoth customer base. Convenience need gaps have been felt in various fields and research shows that the urban consumer today seeks convenience in shopping for their basic requirements so that their precious time is reserved for more productive activities. Petrol retail outlets provide an excellent framework for setting up convenience retail chains. Here, the consumer enjoys dual occasion of, opportunity of combining shopping with the fuelling. Hence, along with the strategic locations, the number of footfall in the petrol retail outlets gives petroleum retail companies the competitive advantage. Worldwide, petrol station convenience stores have developed into a serious business in itself with companies like BP, Shell, and Exxon running their convenience store chains profitably. All of them have deployed best retail practices in their stores and offer a wide range of services including laundry, postal services, courier services, fast food etc. Here are some of the reasons so as to why non fuel petroleum retailing offers immense scope as far as India as a destination is considered. • 2nd most attractive developing market • 4th largest economy after USA, China & Japan. • 2nd fastest growing economy in the world
Page | 93
• • • • • • • • • •
Recommendations for Non-Fuel Offerings
Would be 3rd largest economy in next 15 years 5th among the 30 emerging markets for retailers Largest young population in the world 300+ million middle class - the Real consumers Increased disposable Income Among top 10 FDI destinations Major tax reforms including implementation of VAT in progress Massive investment planned in infrastructure development in next 5 years Exponential growth is taking place in Retailing in India Organized Retail Only 3% but growing at 30%
To deliver the many conveniences and services, various oil marketing companies have associated with leading brands and companies like ICICI Bank, Coca Cola India, Fed Ex, Cafe Coffee Day, Western Union Money Transfer, US Pizza, Barista, Domino’s Pizza, Skypak, etc. The facilities on a particular outlet would depend upon the purchasing power of the people. The facilities like Cafe Coffee Day, Barista, Domino’s Pizza, US pizza, Crossword, Skypak, etc and other expensive outlets may not work everywhere. Apart from them there are many other facilities which can be offered to draw more and more customers, thereby increasing profitability and level of customer satisfaction. Here, we will have a glimpse of some of the facilities which are expected by a customer and can be offered to them on an outlet: ATM (Automated Teller Machine or Any Time Money): An ATM is the most expected facility at an outlet. Almost every customer now has a debit/credit card and he/she expects an ATM at the outlet. • Benefits from implementing an ATM: a) Customer will get an additional facility along with fuel and it will help to draw more customers. b) Increase in revenues due to the lease rent from the bank. A room 120 square feet is required to install an ATM which is a nominal expense. The company may get rent in the range of Rs 8000 to Rs12, 000 per month depending upon the location.
Quick care point: A mechanic who can quickly give a service to the concern vehicle and also he can do the air check. In the quick care point, various lubricants and coolant can be displayed with the purpose of advertisements as well as enhancing customer awareness. The facility of tyre puncture should also be offered. This will further enhance the revenue of company.
• Page | 94
• Windscreen cleaning facility: A cleaning man can wipe the windscreen of four wheelers and front or body of the two wheelers while customer is getting his/her vehicle fuelled. This will augment the customer’s perception of brand as well as organization. An extra attendant can serve for the role of cleaner.
Free health check-up: In the outlet some free health check up camps can be organized by the company doctor. This will illustrate the responsibility of the organization towards the society. Some of the camps which can be organized may include the Pulse-polio camp and AIDS awareness camps. A citizen reward program can be conducted during the same camp, which would cater to honoring of some local people who have made contributions to society. Auto/taxi drivers segment can be recognized and honored for their outstanding service to society. On similar approach best employee award can be given to outstanding employee. It will boost the pump attendants to give perform best in their jobs. Their performance can be monitored on the following parameters: 1) Punctuality: - Time of arrival and departure. 2) Discipline in the job. 3) How well an individual is prompting for branded fuel and other allied services. 4) Behavior with the customers. 5) Neatness. INDE-PAY: It is e- recharge machine which will provide a recharge of six different telecommunications companies along with the railway reservations. The facilities offered by Inde - pay machine are as follows: ∗ Recharge Vouchers (mobile top-ups) ∗ Flight tickets ∗ Rail tickets ∗ Utility Bill-Pay ∗ Cinema tickets ∗ Budget Hotels ∗ Contests The benefits of Inde - pay machine to the end user are: ∗ Alternate revenue stream ∗ High ROI ∗ Major Value added services under one single terminal
Page | 95
With the purchase of the terminal in addition to the value added services, PCO and POS the retailer gets the following: ○ IRCTC authorized e-ticketing agent certificate ○ Airline ticketing (IATA sub-agent license) Wireless POS working over IP – saves per transaction dial out cost Wireless POS – could be used in exhibitions/trade shows where merchants are deprived of a phone line to connect their traditional POS The end user will be able to accept payments in cash, credit card and cash card.
Vending Machine of Coffee and Coca-Cola:Vending machine of coffee and coca-cola will help in enhancing the revenues. It will also augment the customer satisfaction level. Along with them, beverages items like mineral water bottles, snacks etc. can be display in a stand near the dispenser for sale. • Pay Phone:This is another facility which can be provided to the customers. It requires very less space and has low initial investment as well as zero maintenance cost. The pay phone will help in drawing the customers. • Other Necessary Amenities ○ Toilets:Neat and clean toilets facilities should be available for the customers. ○ Drinking Water:Purified drinking water facilities should be available to the customers. Depending upon the climate hot or cold water can be provided. It is expected that if these above mentioned amenities could be added to the Retail Outlets depending upon their potentiality, customer expectations and non fuel revenues could be earn. This will promote the sales of the RO as well as IOCL.
Page | 96
Branded Fuels and its Promotion
Brand: A brand is the identity of a specific product, service, or business. A brand can take many forms, including a name, sign, symbol, color combination or slogan. The word brand began simply as a way to tell one person's cattle from another by means of a hot iron stamp. The word brand has continued to evolve to encompass identity - it affects the personality of a product, company or service. Brand Management: Brand management is the application of marketing techniques to a specific product, product line, or brand. It seeks to increase a product's perceived value to the customer and thereby increase brand franchise and brand equity. Marketers see a brand as an implied promise that the level of quality people have come to expect from a brand will continue with future purchases of the same product. This may increase sales by making a comparison with competing products more favorable. It may also enable the manufacturer to charge more for the product. The value of the brand is determined by the amount of profit it generates for the manufacturer.
Recommendation for Promotion of XTRA Mile and XTRA Premium: It has been found during the whole survey that a large
percentage of vehicles prefer to choose normal petrol and diesel. Demand for branded fuels are very less that is only because of high rate and differences in price with normal fuels. It is also found that a good number of customers are not at all aware of the branded fuels and how to use it.
Page | 97
Here is a list of some promotional tips for branded fuels which, if done, regularly and in a sincere way, must fetch some good results. 1. Awareness Program: a. Leaflets and Brochures: Leaflets and brochures of branded fuels of IOCL can be distributed among the customers in retail outlets who are coming to fuel their vehicles. It should be kept in mind that majority of the commercial vehicle drivers are not much familiar with English language and thus, must be printed in Bengali and Hindi too. Leaflets will contain all the advantages details of the branded fuels and it will also contain the list of applicable vehicles that can use it as per their manufacturing age. It will also say about the offers and value added services provided with branded fuels in time to time basis. It is because a common feedback was found that car service centre has recommended not to use branded fuels.
b. LCDs and CFTs in ROs: Use of LCDs and CFT screens on Retail
Outlets will help to demonstrate the advantage of using branded fuels. It will promote the sales of branded products and also create an attractive ambience for the customers to come in.
c. Advertisements: Advertisements in print medias and local
medias are of great importance which will boost the sale of branded fuels. It will promote about the offers and promotions too.
d. Brand Ambassador: Hiring a brand ambassador is of great
importance and here in this case of branded fuels, common man is the best option for the brand ambassador.
e. Arranging a common meet like Rallies or Marathon Walk
on Sundays or Official Holidays: Invite some of the celebrities, players, economists or industrialists and can organize a rally or marathon walk mainly highlighting the branded fuels.
Page | 98
f. Tie ups: Tie ups with different Car manufacturers major can
promote the sale of branded fuels by recommending the car purchaser to use branded fuels of IOCL. 2. Offers and Promotional Services: a. Loyalty card exclusively for Branded Fuel users: Loyalty cards can be introduce for the customers using branded fuel which will give some extra benefits like reward points, free car servicing in specific service centres, free car accessories and decors, etc. b. Seasonal gifts: Seasonal gifts during Durga Puja or New Year or Xmas can be provided to the branded fuel users. c. Lucky Draw: Lucky Draw coupons can be given to the users and 1st prizes like a Maruti Alto, or of similar value can be provided. d. Ensured gifts: Gifts ensured in every purchase of branded fuels like cooking utensils, car accessories, toiletries, gift vouchers and hampers from shopping malls and restaurants, cash back, discounts, etc can be provided. The main intention to do all these promotions is to increase the branded fuel sale and also to pull customer and meet their expectations and satisfy them and retain them.
Page | 99
Recommendations to improve Xtra Power Fleet Card Service:
Fleet card users are one of the loyal customers of Indian Oil. It was found that there were many reasons of dissatisfaction among the users of fleet card. While the survey it was a fact that customers of fleet card was really annoyed and at times blasted with agonies and problems. It was quite challenging to make them understand the real situations and regain the faith on Indian Oil. The major feedback was regarding the fleet machines which get disrupted very frequently and the concern authorities take a large span of time to visit and repair it. Server problem is another common problem and is a major issue because the fleet card users come and fuel and the only mode of payment is fleet card. They do not have enough money with them to pay in cash if the server is down or something happens. At that case dealers have to give them fuel either in credit or the drivers has to keep their cards with the RO. Redemption of point is a great issue. Many have given the feedback that points are not redeemed at time and the gifts are not of good conditions. Here are some suggestions to overcome the loop holes of the Fleet Management in Indian Oil.
1. Fleet machines should be more users friendly and its operations
should be much handier. 2. Automation, if possible, should be in such manner that all the billing and transactions starting from cash payments to all types of card payments like debit card, credit card, co-branded cards, fleet cards,
Page | 100
etc, can be done from the automation enabled machine from the POS (point of sale). This will reduce the error and time of the transactions making it more transparent to the customers. 3. Concern authority should take prompt actions for resolving the fleet machine related problems. If call centers and customer service centers are required for online solving of the problem, IOCL should go for it. 4. Vehicle Tracking System which is now available by internet is a difficult task for all the class of customers who are using fleet cards. Vehicle Tracking System should be like Money withdrawal and deposition information of the phone banking facilities of the bank. As soon as a transaction has taken place, the enrolled mobile number of the customer will receive a SMS about the place, RO and litre of fuel filled by the respective vehicle no. Total amount of XTRA points should be intimated to the customer by SMS too. 5. More alliance partners should be there to redeem their points and take necessary commodities as required. Alliance could be there with TATA motors for spare parts, Car Insurance with Oriental Insurance or National Insurance or any other insurance sector players. 6. Application for the new cards should be delivered within stipulated time period mentioned in the brochure. Card renewal should be much faster. 7. Daily limit should be increased which is now Rs.70000. 8. Special gifts like fertilizers, pesticides, insecticides can be provided to the agricultural fleet card users. 9. Some monthly or quarterly discounts can be given to the corporate customers. 10.Gifts for the drivers like T-shirts with IOCL logo will promote the brand. 11.Both fuel and non fuel gifts should be there for the fleet card users. 12. During festive season the drivers those who are using fleet card for fueling their vehicle from IOCL should be provided some gifts for their family. 13.Free parking Space should be provided for fleet card users wherever possible. 14.Nominal vehicle checking should be provided to the fleet card users free of cost.
Page | 101
Recommendations for Customer Retention:
When a customer gets into your outlet, a new relationship starts. But starting a relationship is very easy but to maintain it is the toughest part. To maintain a lifetime customer relationship needs excellent customer service and meeting the customer expectations as much as possible. Satisfying and delighting them with newer services. Here are some lists by which all these parameters can be easily solved.
1. IOCL have cobranded card of Citi Bank. But Citi Bank, generally,
represents a posh bank with above middle class customers. But today in the age of TATA Nano, having a private car is of no big bowl food. Majority of the customers are middle class or upper middle class people who does not have account with citi bank or so. Middle class customers prefer SBI. So, making Co- Branded cards with some nationalised banks such SBI –IOCL or Axis Bank-IOCL,which will help to increase loyal customer. 2. IOCL can step into another loyalty program. For example, if a customer fuels more than Rs. 1500 petrol at a time, he will be getting a offer of a loyalty card. This card is not like any debit card or credit card or petro card. The customer can fuel as per his choice by cash, debit or
Page | 102
credit card. But whenever he purchases each Rs. 10 equals to 1 point which is equal to a rupee. This point can be redeemed at allied shops like West Side, Pantaloons, Café Coffee Day, KFC, Spencers, More, Big Bazaar, etc. and can purchase any thing they like. 3. IOCL should give some rewards or incentives to the dealers on the basis of which they will take interest to do sale promotion of fleet cards and converting the parmanent and other customer into loyal customer.
Page | 103
“We can believe that we know where the world should go. But unless we're in touch with our customers, our model of the world can diverge from reality. There's no substitute for innovation, of course, but innovation is no substitute for being in touch, either”. –Steve Ballmer. “A customer is the most important visitor on our premises, he is not dependent on us. We are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider in our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us an opportunity to do so”. –Mahatma Gandhi. The whole survey report dealt with the different aspects of customers in Indian Oil. But the crude essence of this research report is one –“CUSTOMER RELATIONSHIP”. Unless and until we made the customers understood that we can go a long away with them to serve them the best we can, customer relationship does not make any sense. We have got so many complaints regarding so many things at Indian Oil. But the most interesting part of it is that statistics suggest that when customers complain, business owners and managers ought to get excited about it. The complaining customer represents a huge opportunity for more business.
Page | 104
It is indeed a great opportunity for Indian Oil that they have customers who are complaining and that suggest they want much more from Indian Oil. They have the trust and faith on IOCL. We should really look forward to fill up all the loop holes with our intense customer service and offerings. With these I end my project here and wish to see IOCL implementing these suggestions after evaluating the pros and cons and creating an example for the world about their service, offerings and relations with the customer.
“Satya Mewa Jayate”
Questionnaire to evaluate the customer satisfaction in city retail outlets of IOCL
Vehicle no: Type of Vehicle:
1. How much you pay on an average on fuelling your vehicle per month? a. Less than Rs. 500 b. Rs. 500 –Rs. 1500
c. Rs. 1500 – Rs. 3000 d. Rs. 3000 and above
2. Which fuel do you use generally and why? a. Unleaded Petrol b. High Speed Diesel c. Xtra Mile d. Xtra Premium 3. What is the basis for choosing a Retail Outlet?
a. Quality and quantity
b. c. d. e. f. g. Service Convenient stopping and filling Housekeeping and ambience is attractive Air checking facility is available Garage is available Others
4. What are your expectations from a RO as customer? a. Customer Service
b. Quality & Quantity Page | 105
5. What are the facilities that you would like to have in a RO? a. ATM b. Washrooms c. Restaurants and Bars d. Multipurpose Stores e. Spare parts stores f. Others
6. How frequent you visit the IOCL Retail Outlet? a. Daily b. Once in a week c. More than once in a week d. Once in a month e. More than once in a month f. Never
If frequent, then Why? _____________________________________________
ii. If Not, Why? ______________________________________________________
7. Do you know the name of the branded fuels of IOCL? a. If Yes, What benefits are you getting from it? b. If No, Why are you not using it?
8. Tell me one thing you like about IOCL:
_______________________________________________________ Tell me one thing you dislike about IOCL: _____________________________________________________ 9. Please list the top three reasons for which you would like to become a loyal customer of IOCL, that is, you would like to come again and again to IOCL rather than going to any other company’s RO, in order of importance? a. __________________________________________________________ b. _________________________________________________________ c. __________________________________________________________
10. Any Suggestions
Page | 106
Questionnaire to evaluate the customer satisfaction in Highway Outlets of IOCL
Vehicle no: Type of Vehicle: 1. How much you pay on an average on fuelling your vehicle per month? a. Less than Rs. 10000 b. Rs. 10000 –Rs. 25000 c. Rs. 25000 – Rs. 40000 d. Rs. 40000 and above 2. Which fuel do you use generally and why? a. Unleaded Petrol b. High Speed Diesel c. Xtra Mile d. Xtra Premium 3. What a. b. c. d. e. f. g. 4. What a. b. c. d. is the basis for choosing a Retail Outlet? Quality and quantity Service Convenient stopping and filling Housekeeping and ambience is attractive Air checking facility is available Garage is available Others are your expectations from a RO as customer? Customer Service Quality & Quantity Parking Space Others
Page | 107
5. What a. b. c. d. e. f.
are the facilities that you would like to have in a RO? ATM Washrooms Restaurants and Bars Multipurpose Stores Spare parts stores Others
6. How frequent you visit the IOCL Retail Outlet? a. Daily b. Once in a week c. More than once in a week d. Once in a month e. More than once in a month f. Never i. If frequent, then Why? ____________________________________________ ii.If Not, Why? ______________________________________________________ 7. What is your mode of payment? a. Cash b. Card c. Others 8. Do you know the benefits of Fleet Card? a. Yes b. No 9. If yes, what benefit are you getting from using Fleet card? a. Safe b. Don’t have to carry cash c. Rewards available d. Redeemable Points available e. Others 10.Tell me one thing you like about IOCL: ___________________________________________ Tell me one thing you dislike about IOCL: _________________________________________ 11.Please list the top three reasons for which you would like to become a loyal customer of IOCL, that is, you would like to come again and again to IOCL rather than going to any other company’s RO, in order of importance? a. __________________________________________________________
Page | 108
b. __________________________________________________________ c. __________________________________________________________ 12.Any suggestions.
Bibliography and References
Dwivedi 2. http://www.scribd.com/doc/3942812/Project-Report 3. http://www.scribd.com/doc/18945057/Internship-Indian-Oil 4. http://business.mapsofindia.com/india-petroleum-industry/ 5. http://www.iimcal.ac.in/community/consclub/reports/petroleum.doc 6. http://www.iocl.com/AboutUs/Objectives.aspx 7. http://www.companyin.com/ioc.htm 8. http://www.iocl.com/AboutUs/Objectives.aspx 9. http://www.iocl.com/AboutUs/Profile.aspx 10. http://www.scribd.com/doc/14197461/IOCL-Report 11. http://www.cmlinks.com/hpclintra/indrepdis.asp? indnos=131&cap=Competitive+Scenario&ind= 12. http://www.bharatpetroleum.com/EnergisingBusiness/FA_FuelServices_ Overview.aspx?id=1 13. http://www.bseindia.com/xmldata/corpfiling/AttachHis/Essar_Oil_Ltd1_230110.pdf 14. http://en.wikipedia.org/wiki/Bharat_Petroleum 15. http://www.hindustanpetroleum.com/En/ui/AboutUs.aspx 16. http://www.associatedcontent.com/article/255649/do_commercials_bra inwash_people_to.html?cat=46 17. http://dictionary.bnet.com/definition/customer+expectation.html 18. http://www.wisegeek.com/what-is-customer-loyalty.htm 19. http://en.wikipedia.org/wiki/Customer_retention 20. http://en.wikipedia.org/wiki/Customer_relationship_management 21. http://en.wikipedia.org/wiki/Customer_satisfaction 22. http://en.wikipedia.org/wiki/Customer_retention 23. http://quotations.about.com/od/businessquotes/a/customerservice.htm 24. http://www.icelebz.com/quotes/steve_ballmer/ 25. http://www.woopidoo.com/business_quotes/innovation-quotes.htm 26. http://en.wikipedia.org/wiki/Brand_management
Page | 109
28.Business standard – 28/06/2010
Page | 110
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue reading from where you left off, or restart the preview.