Strategic Management

Batch – 2020-22

Business Plan Report

BERGER PAINTS

SUBMITTED TO: SUBMITTED BY:

Dr. Prashant Gupta Apoorva Jain (PGFB2007)

Kritika Godha (PGFB2026)

Niharika Suhalka (PGFB2033)

Nisha Mantri (PGFB2034)

Shubham Kumar Jha (PGFB2050)

Tamanna Jha (PGFB2055)

 INTRODUCTION

We can paint our home wall according to our imagination with the help of Berger's paints.
Berger paints is an ISO 9001 company and the country’s Second-largest paint manufacturer,
with its headquarters in Calcutta. Berger paints hold a distribution network comprising 82
stock points and 12000+ paint retailers across the country.
The company offers quality colorful paints for their customers includes homeowners,
professional and industrial users, because of its quality products the company attained instant
recognition worldwide. They work towards meeting the quality requirements of the domestic
market.
VISION:
To be the most appreciated Indian Paint & Coating Solutions Organization with worldwide
capabilities.
MISSION:
To maximize shareholder value by developing and delivering innovative and best solutions
for customers, consistently outperforming our peers, and providing a Dynamic & Challenging
work environment for our employees.
PRODUCTS:
Interior wall coating
Exterior wall coating
Berger metal and Wood Paints
Protecting Coatings
Construction chemical
Sanitizers
Disinfectant
SERVICES:
Express paintings
Projects
Innovative Packaging
 PESTEL ANALYSIS
Political Factor
Role of Non-Government Organization, Civil Society & Protest Groups – Our country has a
thriving civil society culture, and Berger paint is concentrating its efforts on building bridges
with them and identifying areas for collaboration. Civil society organisations have a
significant impact on policy development as well as the development of a societal narrative.
Segregation of Political Responsibilities between Different Government Agencies – There are
several government departments, which decreases the risk of one agency exerting undue
pressure. However, it raises the time and expense of doing business as well as obtaining
certifications and clearances. As a result, in order to cope with this, Berger paint is primarily
based on the variables that deal with time and cost at the same time.
 Regulatory Practices - The regulatory practises are in line with international standards, which
have aided the country in improving its “ease of doing business” ranking.

Economic Factors
Employment Rate –If the unemployment rate is high, it will affect Berger paint strategies in
two ways: first, it will provide enough customers for the company's goods, and second, it will
make hiring talented and skilled workers more costly.
Financial Market Structure and Availability of Capital at Reasonable Rates: The Federal
Reserve's quantitative easing policy has resulted in a flood of liquidity into global financial
markets. As a result, Berger paint will borrow at a low cost in such situations. However, as
interest rates rise, this strategy poses a risk.

Social Factors
 Attitude towards Health & the Safety – The quality of goods and the cost structures of
manufacturing processes also represent a company's attitude toward health and safety. So,
since Berger Paints has stringent health and safety standards, it will have to contend with
players who do not have the same high-cost structures as Berger Paints in emerging markets.
Level of Social Concerns & Awareness in Society: When society's social needs are strong,
consumer advocacy and agitation from non-governmental organisations and pressure groups
also increase.

Technological Factors:
Transparency & Digital Drive: Berger Paint is primarily focused on using digitalization of
different processes to combat corruption in the local economy; as a result, Berger Paint is
able to work with the highest level of data security and transparency.
 Preparedness for 5G Related Infrastructure –Countries all over the world are attempting to
plan for the deployment of 5G networks. Berger is now concentrating on determining how
equipped the local market is to carry out 5G connectivity.
Mobile Phone & Internet Penetration – Berger Paint should evaluate the country's internet
and cell phone penetration before developing a business model that is tailored to local needs
and realities.

Environmental Factors
Environmental Standards and Regulations both at National & Local Levels – Environmental
policies at the national and local levels are often at odds. This can assist Berger Paint in a
variety of decisions, including plant location, product production, and pricing strategy.
Influence of Climate Change – What effect will climate change have on Berger Paint's
business model and supply chain? If the supply chain is not flexible, for example, shipments
from one part of the world can be delayed due to a sudden climate change, resulting in
bottlenecks. Berger paint performs well in this regard when it comes to coping with climate
change.
 Corporate Social Responsibilities Culture – Is Berger Paint's current CSR efforts relevant in
the new market, or does it need a new initiative to meet the needs of the potential market?

Legal Factor
Transparency in Judiciary System & Processes – Transparency is essential for making
rational and consistent decisions. Berger paint will prepare ahead with greater confidence if
the method is clear and straightforward.
Health & Safety Laws – What are the country's health and safety rules, and what does Berger
Paints need to do to comply? Since various countries have different attitudes toward health
and safety, Berger Paint should perform extensive research prior to entering the market.
 PORTER’S FIVE FORCES ANALYSIS

Threats of New Entrants - LOW

 Asian Paints and Berger Paints alone accounts to 75% of revenue among listed Paint
Companies. It is very difficult for anyone to be the emperor in the Paints Industry.
 Working capital required is high. There are 300 varieties of materials used in the
industry.
 Sometimes there is also shortage in the supply of raw materials.

Competitive Rivalry – LOW

 About 80% of this sector is contributed by the top 3 companies.
 Large company like Asian paints is the main competitor to this.
 This is also an unorganized sector.
Bargaining Power of Supplier – MEDIUM
.
 Titanium Dioxide is a key ingredient used which have huge shortage hence supplier
can bargain.
 It also import raw materials
 Sometimes there will also be a high fluctuation of price in raw materials.

Bargaining Power of Buyer – MEDIUM

 The consumer is important for industry and household companies.
 Price can be sensitive

Threats of Substitutes – LOW

 In rural areas lime wash is used as a substitute
 Wallpaper is used as a substitute
 People use marbles in case of paintings as well

EFE MATRIX
Key External Factors
By utilizing EFE Matrix we recognize that the key external opportunities and threats that are
influencing or may influence an organization. By examine the outer environment with the
devices like PESTEL Analysis, Porter’s Five Forces or Profile Matrix; the key external
elements can be distinguished. The overall principle is to distinguish whatever number key
outer and inner factors as could reasonably be expected.
Weights
Each key factor ought to be assigned a weight going from 0.0 (low significance) to 1.0 (high
significance). The number shows how significant the factor is if an organization needs to
prevail in the industry. In the event that there were no weights assigned, every one of the
variables would be similarly significant, which is an incomprehensible situation in reality.
The amount of the multitude of weights should rise to 1.0. Separate variables ought not to be
given a lot accentuation (assigning a weight of 0.30 or more) on the grounds that the
accomplishment in an industry is once in a while controlled by one or few components.
Ratings
The ratings in the external network refer to how adequately organization’s present procedure
reacts to the chances and threats. The number range from 4 to 1, where 4 means a superior
response, 3 means above average response, 2 means the average response and 1 is poor
response, we can see the company’s response to the opportunities is not poor, because only
one opportunity has received 2 rating while the rest have 3 and 4 ratings.
Weighted Score
The score is the result of the weight increased by rating. Each key factor should get a score.
All out weighted score is just the amount of all individual weighted scores. The firm can get
similar all out score from 1 to 4 in the two networks.
 IFE MATRIX

The Internal Factor Evaluation (IFE) matrix is a strategic management method for
auditing and assessing major strengths and deficiencies in a business's functional areas. It can
be used to assess how well a company is doing.

In the above matrix for Berger paints we have taken 6 strengths and 2 weaknesses. We have
taken rating scale from 1 to 4. The strengths must receive a rating of 4 or 3 and the weakness
must receive a rating of 2. Berger has received a score of 2.6 which is an average score. It
indicates that the company is vulnerable to its rivals and it needs to strengthen it strategies in
order to sustain in the paint industry.

STRENGTHS

Brand Recognition: As the second largest paint manufacturer in the world, they have a strong
brand. Almost everybody knows the name of the company and is familiar with its products
and services. They've become well-known as a result of their tireless campaigns.

International Market: They have international operations in Nepal, Bangladesh, Russia,

Poland, and Cyprus, as well as collaborations with Sweden's Becker and Japan's Nippon
Paints.

Loyalty: When it comes to re-painting their houses, customers are faithful to Berger Paints.
WEAKNESS

High dependence on 1 segment: Berger Paints has a high reliance on a single segment for the
majority of its sales, which is the decorative segment. This is not a long-term plan, and a high
rate of growth cannot be maintained indefinitely.

Weaker distribution – Berger paints has a weaker distribution network than Nerolac or Asian
paints, which is a big issue for the company. It needs to expand its distribution network and,
if necessary, raise its production capacity to keep up with demand.

INTERNAL-EXTERNAL EVALUATION
 VRIO MODEL

The VRIO system is utilized to investigate the two fundamental significant asset of Berger
and recognize if there sources have been viable and how powerful they could be later on.

• Berger's extension inside the country and worldwide tasks just as the item
enhancement Berger was associated with

• Berger's consistent marking of its sub items, for example, Luxol, Rangoli,
and Bison and so on.

Valuable:

Item broadening into car covering and plastic substrates put Berger Paints at a lot more
grounded traction and caused them to go into these business sectors that the contenders have
not entered at this point. Likewise, the marking were expanding the significance and worth of
these items to an ever increasing extent.

Inimitable:

The contenders could likewise recognize similar areas to enter and take a stab at purchasing
additional assembling units. Be that as it may, marking an item and causing it to accomplish
significant notoriety would take some time and these all around existing famous items would
have an edge over it.

Rare:

The assembling units that were obtained inside the country and the joint efforts with Japanese
Nippon Paints and Becker of Sweden were surely uncommon and it would not be feasible for
the contenders to accomplish. Albeit comparable brand system could be received by the
contenders, the particular brands, for example, Luxol and Rangoli explicitly had a place just
with Berger and the contenders would be not having the option to possess it.
RarYes)

Organized:

Berger Paints realized how to exploit these assets and utilized it to use its deals however
much it could. Likewise, Berger paints comprehended the significance of promoting its items
and consistently kept marked its items and guaranteed that it didn't at any point lose its fame.
 BCG – MATRIX

Examining the BCG of Berger paints which will help the association with considering
advancement openings by reviewing its game plan of things to pick where to contribute, to
stop or make things.

The association deals in various thing ranges, for instance, glass finishes, undercoats,
waterproofing course of action, outside surfaces and the as of late conveyed range which is in
the home tidiness and security part named as breathe in basic, so we can see that there are 4
quadrants – show, gold mine, star and canine so arranging all of the things as shown by the
plc. design will help in perception in which quadrant will each class lie in.

So starting with the question mark, it the quadrant which depicts high market advancement
and low piece of the general business, here the association needs to finish up whether to go
for a raised framework, market improvement or sell them. So in this stage the as of late
dispatched partition which is the tidiness and security can be arranged involving

Breathe in basic sanitizers, and sprinkles floor sanitizer as it is seen that in light of the Covid
circumstance and rising prosperity concerns such sanitizer are showing an upward example in
the market so the association has a phenomenal opportunity to fill in this part and
augmentation their target base as the piece of the general business for such things is entirely
high anyway understanding that there's a colossal competition keeping watch so Berger being
a pioneer in the Paint partition the purchasers are mindful of buying Breathe basic conversely
with various choices available to them, similarly the association has not really made immense
pay in this segment depicting low slice of the pie.

By then going to the Star, this quadrant depicts high market advancement and high slice of
the pie, presenting best since quite a while past run openings for improvement and efficiency
for the affiliations. So in this quadrant we can fuse the waterproofing plan and the undercoats
that the association makes, for instance, divider sheets, sealers and break screens. The market
for such thing have extended and the association has obtained a huge proposal in the market
with such thing with market invasion methods, moreover Berger Paints have will acquired
95.53 percent stake of STP Ltd which is for the most part into waterproofing and guarded
coatings. This getting will help Berger in its present associations.

Examining the mother lode, this quadrant depicts low market advancement and high piece of
the general business, the waterproof adversary of buildup paints, and within and outside paint
characterization is associated with this. As we can see that this is the speediest creating
segment which has successfully made a brand arranging making incredible pay keeping
watch, this the their medium to deliver excess cash to address the issues for greater upgrade
as we understand that high improvement rate doesn't allow them to convey their resources so
they to expand.

Last yet not insignificant, talking about the fourth quadrant, which is canine depicting low
market advancement and low piece of the general business. Business are much of the time
traded, stripped or oversaw down through preservation. This quadrant join the Berger's
marine covering It is a little segment. Likewise, it doesn't have exceptional material impact
similarly as the pay because there are an enormous number of competitors into this, all are
outstanding players and everybody has its own fortitude.
 GRAND STRATEGY

Whenever an association is assessing their fundamental decisions, the Grand Strategy Matrix
can be used to deliver discussion and decisions.

All of the associations can be arranged in one of the 4 quadrants of the stupendous framework
subject to the 2 estimations – which are Competitive position and the market development.

So to analyse the association (Berger paints) similar to the fundamental decisions, we can say
that after Asian paints Berger rank second regarding the slice of the pie, it has a strong
relentless position when stood out from various adversaries keeping watch, it is moreover
seen that Berger works specifically divisions for each, one such, protective coatings division,
"Affirmation". This current division's embodiment is in the market from the soonest
beginning stage and is a market head with respect to business, volumes, in the advanced part.
The thing extent of both Asian paints and Berger is almost neck-to-neck and kept up in such a
way to beat the resistance. So with we can say that the difficult circumstance of the
association is especially strong. Where Asian paints has a 40% market, Berger similarly has a
32% market, which tells that the association is going on well, and for getting more merciless
edge over the pioneer it should appreciate expanding , it might be associated or arbitrary at
any rate we can see that the new arrive at which is prosperity and tidiness has not increment a
ton of offer so the association should endeavor to think about some associated extension
strategy. Examining its market advancement in the current circumstance, we can see that
because of Coronavirus the store organization and the premium for such items have upset
COVID-19 has been the most irksome force for the overall paint and covering industry in
progressing memory.
The Indian paint and coatings industry has seen demand plunge to some degree as of late in
an astounding manner. In spite of the way that creation units has proceeded in a shocked
manner, the continuing rising number of cases and falling interest has caused anxiety among
the fundamental paint and covering creators. Berger India Ltd on Friday uncovered a 91.44
decline in joined net advantage t0 Rs. Pay from assignments dropped 45.77, so it might be
said that at present the market improvement isn't much higher. This is depicting that the
association lies in the quadrant 4.

CONCLUSION

There is a colossal potential for the paints business as family salaries are raising and
individuals like to improve with more current tones in their homes.
There is consistently interest for quality items and Berger being a favoured brand among
clients.
The paints market is especially serious in spite of the fact that Berger paints holds the
significant piece of the overall industry. In any case, the development pace of the contenders
is incredible difficulties for Berger. The facts confirm that Berger paints is conspicuous in the
market on account of its top notch items, cutthroat value rate and so forth .The best option of
purchasers is Berger on the grounds that they can depend on it and its durable capacities .It's
additionally ready to give the shoppers choice of picking assortment of tones; 5000 shades
inside 5 minutes through its shading bank.
Berger paints is a lot of confined in credit strategy. It gives credit just to some chose sellers
whereas different contenders are a lot of liberal in credit. Paints merchants, wholesalers or
retailers, are normally a lot of found of colossal credit. Accordingly they key contenders
slowly experience childhood in the market through their immense credit strategy.
With elite reach and solidness, Berger is consistently prepared to reply to all climate
condition and attempt to fulfil each edge of the country.

Corporate Social Responsibility

To empower the youthful specialists in their undertaking, the organization has begun Berger
Young Painters Art Competition in 2008 and coordinated it the organization. Over this period
3500 artwork 500 special fine arts including 60 granted winning canvases were investigated
and shown through presentation.
To advance and motivate the youthful Architects, the organization has been putting together
biennial rivalry for Young designers, since 2007 .The subsequent occasion was during 2008.
Other than in 2006, the organization has supported a decent number of socio culture
improvement programs coordinated by various social associations.

 Technology Development-

Berger came with the very first low volatile organic compound paint. Its inspiring
innovative service proposition –Device Distribution Beacon, Virtual 3D paint look,
Germ kill paint, Breathe easy paint made its name.

 Inbound logistics

It tries to keep its raw material cost minimal even with the large range of product
diversification they try to use such materials which results into low cost of the paints.

 Outbound logistics
They have more than 85 depots and 2000 dealers with the effective inventory
management and less distribution cost and reaches every level of customers with its
distribution channels.

 Operations
As it not only operates in India but also in Poland, Russia, Bangladesh and Nepal with
dedicated sales team and service.

 Backward integration-
Berger doesn't fabricate itself the printed jars and re-appropriates it to the outer
sellers. The expense of acquisition of completed merchandise for Berger paints was
15% higher contrasted with Asian Paints. The expense of acquisition of completed
products as level of deals for Berger paints is just 1.5 contrasted with industry normal
of 3.5 and this thus gives upper hand to Asian paints.