Name Ramgopal Varma

Question 1

Part A:

Period Rate of Growth

2000-2004 27.27%

2004-2010 90.47%

2010-2015 50%

Part B:

Three factors (mentioned in the case) responsible for the growth (or decline) of the two-
wheeler market in India.

1.Consumers' increasing disposable income

2.Aspiration to own a motorized vehicle

3.Availability of easy financing

Question 2

Part A: Three private sector players in the industry.

 1. Shell, 2. Gulf and 3. Valvoline

Three public-sector players in the Industry

1. Indian Oil Corporation Ltd., 2. Bharat Petroleum Corporation Ltd. and 3. Hindustan
Petroleum Corporation Ltd.

Part B:

The direct distribution channel for lubricant market in India are:

1. Forecourt: Petrol pumps and gasoline stations.

2. Franchised Workshops: Authorized workshops that serviced vehicles under warranty,

providing all services related to the vehicles.

The three distribution channels serviced through the distributor for the lubricant market in

India are:

1. Company branded workshops: Company exclusive outlets that catered to all

requirements of two-wheeler servicing.

2. Accessories and spare parts: Stores that stocked and sold vehicle accessories and

spare parts.

3. Pure lubricant outlets: Stores that stocked and sold lubricants of all companies; they

did not stock or sell other products

Question 3
 Question 3A: Consumer buying behavior

In India, 2 wheelers are regarded as the first step of achievement and therefore, its
maintenance for long term is considered important. During the warranty period of the vehicle,
most customers do service with the authorized franchised workshops for the sake of warranty.
After warranty period, most change over to Non franchised workshops for the sake of
convenience, personal relationships, service costs

Question 3B: Technological advancements happening in the two-wheeler industry

The engine designs are changing and the sizes are decreasing. This would result in a slump in
oil use. Two stroke engines are replaced by four stroke engines which mean PSUs are no
longer the front-runners are losing the first mover advantage. All companies in the industry
got the same advantage to go penetrate deeper. Companies just have to search for better
distribution networks and can also innovate this product as per the changing technological
advancements for getting advantage in the market.

Question 4

Part A:

Channel Partner Channel Share (%) 2010

Franchised workshops 30.95%

Spare part outlets 42.85%

Oil shops 11.90%

Non-Franchised workshops 14.28%

Part B: The share of four stroke oil market in Franchised workshop and NFW's is greater
than Castrol. While 4 stroke oils has a share of 39.47% in Franchised workshops, Castrol has
a share of ~30%.

Part C:

Channel Partner Sales (in litre) per channel outlet, 2005

Franchised workshops 6666.67

Spare part outlets 578.95

Oil shops 1103.45

Non-Franchised workshops 400

Part D:

Channel Partner Sales (in litre) per channel outlet, 2005

Franchised workshops 5323.31

 Spare part outlets 557.39

Oil shops 884.15

Non-Franchised workshops \670.88

Part E:

Channel for which the ‘sales (in litre) per channel outlet (for the four-stroke oil market)’ is
significantly greater than the ‘sales (in litre) per channel outlet (for Castrol)’ are Franchised
workshops and oil shops.

Franchised workshops = 6666.67>5323.30

Oil shops = 1103.45> 884.15
Spare part outlets = 578.94>577.38

Part F:

Based on the metrics the areas where Castrol is facing problems are 1. Franchise Workshops
where Castrol has both low channel share and sales per channel outlet as compared to the
Industry Benchmark, 2. Oil shops where Castrol has low sales per channel outlet as compared
to the Industry Benchmark and 3. non-franchised workshops where Castrol has low channel
share as compared to the Industry Benchmark.

Question 5

Part A:

characteristics of the three segments of NFWs

 Category Stock-and-sell Mechanics who Mechanics who are
Mechanics have approached for
worked at the small/minor jobs
franchised
workshops

Segment Size 10% 40% 50%

% of share in oil 30% 50% 20% (if consumers

change needed an oil
change they would
buy their own bottle
of MCO and take it
to Shop)
Oil purchase generally served by These mechanics If consumers needed
behavior the distributors normally received an oil change they
their supply of mostly buy their own
MCOs from nearby bottle of MCO and
spare part shops. take it to Shop.
Financial condition These mechanics These mechanics are This segment was
commanded a highly skilled, but approached for
premium price for short on finances, small
their services and since there is no jobs and thus the
customers did not guarantee and financial conditions
question their ability existence in of
as they had payment. this segment was not
developed high level good and they were
of skills through the short on finances.
years of experience.

Part B:

Module Parameter 1 Parameter 2 Parameter 3 Parameter 4 Parameter 5

1 Low High Low Low High

2 Low High Low High High

3 High Low High Low Low

Question 6

1. CASA’s (Castrol Authorized Service Associates) they will direct report to the DSR in the
headquarters locations. They are the trained distributors sales representatives with access to
these markets
2. CASA’s (Castrol Authorized Service Associates) will pick up the product from small
distributor’s and they will serve the NFW’s small mechanics who set up shop to serve
motorcycles.