APPLIED BUSINESS PROJECT PROPOSAL

Strategic Improvement in Supply Chain Model for Neem

oil production

Final Report

Industry Mentor: Dadasaheb Sawant

Academic Mentor: Prof. T P Anand

Proposal Document Submitted by:

Payal Basak

EMBA02 Global Batch

Roll No: EJU20ONL05

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Table of Contents
ABR PROJECT TITLE ............................................................................................................................. 4
ABSTRACT ................................................................................................................................................. 4
ACKNOWLEDGEMENTS ....................................................................................................................... 5
INTRODUCTION....................................................................................................................................... 6
ACADEMIC LITERATURE ................................................................................................................... 11
RESEARCH DESIGN AND STRATEGY ............................................................................................. 17
RESEARCH QUESTIONS ...................................................................................................................... 23
RESEARCH OBJECTIVE ...................................................................................................................... 23
FINDINGS AND DISCUSSION .............................................................................................................. 24
Macro level External Environmental- PESTE description ............................................................... 24
Industry’s competitive environment-PORTER’S Five Forces ......................................................... 29
Industry level- Competitive profile matrix ......................................................................................... 32
Company Level-SWOT Analysis ......................................................................................................... 37
Analysis of Stakeholders....................................................................................................................... 41
Vision of Golden Agro........................................................................................................................ 41
Mission of Golden Agro ..................................................................................................................... 41
Corporate Objectives of Golden Agro ................................................................................................ 41
TOWS Root Cause Analysis ................................................................................................................ 45
Balanced Scorecard .............................................................................................................................. 58
CONCLUSION ......................................................................................................................................... 67
REFERENCES .......................................................................................................................................... 70

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 DECLARATION

I hereby declare that the matter included in this Applied Business Study report entitled as
“Strategic Improvement in Supply Chain Model for Neem oil production”, is result of the
Research work carried out by me. I further declare that this is my original work and has not been
published anywhere before. This work has been carried out for the sole purpose of submission as
partial fulfilment of Executive Masters in Business Management (EMBA) in the field of
Operations at SP Jain School of Global Management, Dubai, UAE.

Payal Basak
EJU20ONL05
EMBA02 Global Batch

The above is true to the best of my knowledge and information.

Professor T P Anand
Academic Mentor

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ABR PROJECT TITLE
How to strategically improve the supply chain model of Neem Oil production with introduction
of innovative technology and marketing tactics for the Company: ‘Golden Agro Industries’ in
interior Maharashtra, India.

ABSTRACT
Neem is an abundant resource freely available in sub continents of India. There is huge amount
of neem fruit available in forest which are not utilized and get wasted. The oil extracted from this
fruit can be used across various industries such as Pharmacy, medicine, cosmetics, fertilizers etc.
Neem oil industry is a growing industry with a huge potential to increase its market share and
revenue. With the increase in awareness of using biofertilizers and natural cosmetics the demand
for neem oil has increased exponentially over the years. As of now the demand is fulfilled using
both by Indian manufacturers and import. The import of neem oil can be cut down if there is
efficient utilization of raw materials and quality production facility. This would help small
manufacturers increase their productivity and revenue and also help in overall development of
Indian economy. Golden Agro Industries being one of the neem oil manufacturers based out of
Pune also sees a potential to increase its revenue and productivity efficiency in the light of the
growing demand. However, the company requires a strategic plan to meet the demand and fulfill
the supply of its customers. The plan would also help in enhancing the value of all the
stakeholders involved in the process. Since the supply chain involve majority of its functionality
at villages involving lower income groups, the improvement brought in the process would
directly affect the socio economy growth of the country as well.

The report reflects on the current issues that the company faces and aims to come up with a
strategic plan to upgrade the process and increase the company’s productivity which would in
turn increase its revenue.

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ACKNOWLEDGEMENTS
I would like to express my deepest regards to everyone who helped me complete this report.

I could like to acknowledge my Industry Mentor Mr. Dadasaheb Sawant, who has given me an
opportunity to work on this project. His immense knowledge about the industry and its
functioning made the report more valuable. He is involved at grassroot level functioning of
improving the entire gamut from collection to production to delivery scientifically, so that
everyone involved in the process is benefitted. His rich experience encouraged and guide me to
gain insight of this industry from data collection to preparing the report in detail. I deeply
appreciate his time and effort in providing me all the valuable resources required to complete this
project.

A special gratitude to my academic mentor Mr. T.P. Anand who has enthusiastically supported
me with his guidance throughout my project. The knowledge and the insights provided by him
during the whole endeavor has enriched my report. He had a crucial role in providing
suggestions and encouragement in continuously improving my project. I would also like to
express my deepest appreciation to the SP Jain Global Management School who provided me
with an opportunity to present my project and provide me with all the necessary framework
required to achieve my goal.

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INTRODUCTION

Neem Oil is a vegetable oil pressed from fruits and seeds of neem (Azadirachta indica), an
evergreen tree which is endemic to the Indian subcontinent. The neem oil contains many
bioactive components including Azadirachtin and Triterpenoids. These two components have a
crucial role in providing the therapeutic and medicinal value that we get from neem oil. The oil
can be called as a contact insecticide, presenting systemic and translaminar activity which helps
in broad spectrum of actions. The action such as inhibiting feeding, affecting hormone function
in juvenile stages, reducing ecdysone, deregulating growth, altering development and
reproduction, suppressing fertility, sterilizing, repelling oviposition, and disrupting molting
processes can be seen by the components in the neem oil that ultimately contributes to the
healthy growth of crops.

The Neem oil has a wide range of usage from curing diseases using modern and ancient
treatments to enhancing agricultural productivity. The commercial usage of neem oil can be now
seen in soap, facewash, face creams etc.

• Modern/Ancient Medicine- The practice has been since centuries wherein folk medicines
were used to cure diseases such as malaria, ulcer, skin problems, cardiovascular disease
etc. Also, the neem ingredients have been used extensively in various Ayurveda, Unani,

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 Homeopathy, and modern medicine for the treatment and prevention of many infectious,
metabolic, or cancer diseases. The chemicals in neem oil help to reduce blood sugar
levels, healing ulcers in digestive tract, preventing conception, killing bacteria and
preventing plague formation.

• Bio pesticide- It’s been seen that the hazardous use of chemical-based fertilizers and
pesticide have a negative effect on humans and has raised alarming concerns to the
regulatory bodies and consumers. The neem-based products are treated as antifeedants,
growth regulators, sterilant, anti-oviposition agents, and repellents. The oil is one of the
least toxic elements to humans and has very low toxicity to other beneficial organisms
which marks itself as a very promising ingredient for controlling many pests. This in turn
has made the farmers to use bio pesticides which has increased the demand for the bio-
based pesticides. The demand for neem oil is not only limited to India, but there is
demand all across the world, since there is very less growth of neem trees in other parts
of world compare to India.
The neem cake which is a byproduct, is used as a livestock, natural pesticide and
mosquito repellent.
• Commercial products- With the growing awareness about the side effects of the extensive
use of chemical based personal products, consumers are opting for more natural
ingredient-based products. This trend has led to lot of personal care manufacturing
companies to use neem oil as a base ingredient in its product. Products such as Face
cream, face pack, sunscreen, toothpaste, soap etc. uses this neem oil extract. The
continuous use of such products has made consumers appreciate the long-lasting effects
and outcomes.
Leading to increase in demand by the customer (B2B companies) need to procure more
neem oil extracts for using in their products.

The market growth of Neem Oil Industry has a forecasted trajectory of growth and Neem Extract
Market is expected to gain $2.04 billion by 2022. This would in turn register a CAGR of 17.4%
during the forecast period 2016 to 2022.

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The major players operating in the market are Ozone Biotech, Pradip Agrotech, R.K. Oil
Products, Orgo Growth India, Neeming Australia etc.

The Neem Oil Industry has various segmentation based on application, type and region

By region:

• North America- U.S., Canada, Mexico

• Europe- UK, France, Germany, Spain

• Asia-Pacific- India, China, Australia, Japan

• LAMEA- Turkey, Brazil, South Africa, Saudi Arabia

By Application:

• Pesticides/Agriculture

• Pharmaceutical Industry

• Personal Care and Cosmetics

By type:

• Leaf Extract Oil

• Seed Extract Oil

• Bark Extract Oil

The current project focuses only on the Seed Extract Oil Segment which is the core business of
Golden Agro Industry, the company in discussion for the particular report.

Golden Agro Industries is a manufacturing company established in the year 2012 as an

Individual Proprietor. The main business is manufacturing and supply of Organic Neem oil and
Neem fertilizers. The company supplies its products to fertilizer, cosmetic and agriculture
industries who uses these products as a key ingredient. The company’s manufacturing unit is
based out of Sangli which is a drought affected region but has a wide range of good quality

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Neem trees. The fruits of these Neem trees are collected and dried before taking it to process
Neem Oil.

The manufacturing plant is well equipped with state-of-the-art facilities, which uses rotatory
machines to produce Cold Pressed Neem oil. This process ensures best quality neem oil
extraction by maintaining the therapeutical value of the oil from the seeds.

The process followed in the supply chain model wherein the neem fruits are first collected from
individual framers, mainly rural women. These fruits are then further collected and stored in
VLCC (Village level collection center) or NGOs. The fruits are then given to the service
provider partners such as Golden Agro Industries, who would store the neem fruit for further
processing.

The neem fruits are dried to an optimum dryness after which the depluming activity takes place.
These seeds are stored for about 2 months so that the neem oil develops its chemical
‘azadirachtin’ which has various medicinal properties. The seeds are then processed in different
machines to finally extract the neem oil using cold press.

The company receives a lot of demand from different clients across various industries. But the
quantity and quality of the neem fruit collected doesn’t suffice the need of the company to
expand and meet the rising demands of the clients. The company has lot of scope to grow if the
overall supply of the neem oil production is increased. This can be done decreasing the demand
and supply gap.

Most of the neem fruits collected are not of good quality since the collectors are mostly
unorganized labors who don’t have the requisite training nor infrastructure to collect quality
neem fruit that would provide the best quality neem oil upon extraction.

Also, the support price received by the collectors are not sufficient to compensate for their hard
work and effort of collecting and drying the neem fruit. The price received varies from Rs 10-12/
kg which not a sustainable amount, hence encourage the collectors to search for alternatives with
better pay.

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The neem fruit after initial cleaning and drying need to store in the warehouse for 2 months
before the neem seed develops the essential neem oil component that is the Azadirachta
indica which has the core medical properties, can be used as pesticides and fertilizers. The non-
profitable organization post collection needs to handle carefully and further dried and stored in a
cool and dry environment. The optimum temperature during this operation also needs to be
understood to extract the maximum quality neem oil from the neem seed.

The whole supply chain design for Neem oil extraction is setup in such a way that involvement
of the local resident who are living in the drought affected region with very less scope of finding
job opportunities, can possibly have a positive impact on both the economy and individual. Study
needs to be done to understand the current impact of the Neem projects across the country and
put together the best practice guidelines the reap the best out of the process.

Processing of neem oil

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ACADEMIC LITERATURE
As per the current situation in the neem oil production it is suspected that the efficiency, quantity
and quality of the neem oil extracted can be further improved. These three factors c ould bring
about a lot of advantage to the company to increase its customer base (by taking new orders from
different customers) and increase customer retention with the improve product quality and
meeting the expectation regarding the quantity requirement.

The improvement in the supply chain will also have a positive effect on the associated
stakeholders such as the Collector, labors, NGOs, company and the customers. The idea is to
bring about change in the supply chain model to enhance the value addition and increasing the
pie.

To understand the current situation of the neem oil extraction industry and the external effects on
the industries’ functioning the Literature review is conducted, where the objective is to review
and analyses using strategic approach through internet. The main pointers of the review are to
understand the developments in the field of neem oil extraction with best practices, influence of
external agencies and environmental factors and possible improvements (where successful in
other conditions) which can be extrapolated to the company’s ways of working and production
sphere.

The key pointers of the Literature Review are listed as follows-

• Improved result when plastic sheet was used to retrieve neem fruits as there were lesser
stones and dust compared to traditional method and low output using handpicked
methods and individual picking of fruits is a very tedious task.
More efficient process can be determined to collect larger amount neem fruit.
The critical process of depulping the neem fruit has been suggested with the use of hand
operated machine which can be easily operated by the farm worker. The depulper can be
used with prerequisite soaking and assessed using the economic value add.
The other depulper need to be accessed in terms of ease of use, maintenance and
performance. (Solanki, R.C., Naik, S.N., Santosh, S. and Srivastava, A.P., 2017)
Gap- The experiments were performed under closed laboratory conditions; the
implementation of these processes can have a different result than what is documented
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• The oil extracted from neem seed has the maximum amount of azadirachtin, which is
used has a commercial insect growth regulator. The highest yield of azadirachtin was
found when n-hexane, ethanol, binary solvent was used in exact proportions at a
particular geography, climatic location. (Gadien, L.A., Karim, A.K.M.A., Suliman, E.,
Ahmaed, D.T. and Ghada, M., 2018)
Gap- The product manufactured at Golden Agro Industries are not segregated based on
the future use of the neem oil. The neem oil is sold as per the quality measured in PPM,
hence the particular process used to extract azadirachtin, may not be fruitful for all the
customers of Golden Agro.

• The n-hexane methane extraction provided the best yield when hot water was used. The
experiment conducted in the article also pointed out that the storage of neem oil for a
longer duration increased the utilization in soaps and cosmetic production.
Hence different type of storage duration can induce utilization of neem oil in different
products. The finding can help selecting the type of storage for neem oil for different
industry (Koul, O., 2004. Neem: a global perspective. In Neem: today and in the new
millennium (pp. 1-19). Springer, Dordrecht), (Subramanian, S., Salleh, A.S., Bachmann,
R.T. and Hossain, M.S., 2019.)
Gap- The product manufactured at Golden Agro Industries are not segregated based on
the future use of the neem oil. The neem oil is sold as per the quality measured in PPM,
hence the particular process used to extract azadirachtin, may not be fruitful for all the
customers of Golden Agro.
However, the processes can be segregated in future to target segments of particular
customers.

• The article suggest that different intensity of pruning (selective removing plant parts)
process can enhance flowering and fruiting. The moderate pruning of 25% in neem tree
enhanced the nutrient status in leaf and fruit yields. Such technique feasibility can be

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 accessed to get better yield of neem seeds. (Hussein, J.B., Ilesanmi, J.O.Y., Yahuza, H.A.
and Nkama, I., 2021)
Gap- The laborer associated with procurement of raw material neem are not aware about
the pruning processes. The particular group of laborers need to be trained to implement
process suggested in the article.

• The article focuses on the establishing a win-win strategy for both Organization and
employee (or different stakeholders) across the supply chain to have a competitive
advantage. The shared value created by setting up partners at grassroot level helps in
offering innovative last-mile reach solutions for neem oil production supply chain.

Similar to the far-fetched reach of GNFC IN Gujarat the reach can be established across
various other parts of Maharashtra to encourage women labor and entrepreneurs to take
initiative towards Neem oil production. (Prabakaran, P. and Kumaran, K., Studies on leaf
nutrient status and seed yield of different pruning intensity treatments in Azadirachta
indica A. Juss plantation at Tirunelveli district of Tamil Nadu, India.)
Gap- The GNFC company is a urea manufacturing company and the neem project was
started as a part of CSR. The idea to start the CSR was after the understanding that neem
oil coated urea would stay much longer in the soil and help in increasing the productivity
of the crops. Since Golden Agro Industry has a primary business in manufacturing neem
oil there would a difference in the functioning and working of the two companies.

• Fruit color is indicator of maturity which also suggests that the fully ripened seed has
high germination and vigor than normal seeds. The seed color can be a good indicator for
non-technical person like the collectors or the labor. These seeds can be further
segregated to germinated or used for neem oil production. Educating the locals i.e., the
seed collectors and labors is essential. (Goyal, S., Kapoor, A. and Sergi, B.S., 2020.)
Gap-The laborer involved neem fruit collection at the Sangli region are not trained to
understand the different stages of neem fruit maturity. Additional effort needs to be taken

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 to train and educate the labors involved in the process to follow the suggestion mentioned
in the article.

• The article tries to establish that Yobe state which was not profitable, can be made
profitable using diversification program by introducing favorable production and
diversification policies. Similar analysis can be conducted for Sangli region of
Maharashtra to understand the concerns and bring in more diversification of neem oil
production by involving socio economic policies and production facilities. (Rathiesh, P.
and Negi, A.K., 2020).
Gap-The Yobe state is based out of Nigeria the Economical and the Social parameters
may not be same as that of India. Hence the policies and factors need to be mapped and
investigated for conditions in India before implanting it.

• The price per unit of Neem seeds was discovered to be the most important factor
influencing Neem seed collection. Because the study focuses on evaluating the economic
incentives associated with Neem plantations as well as the factors that motivate farmers
to establish Neem plantations on a larger scale, the following tools of analysis were used
to develop feasible information on Neem plantations that will be useful to other farmers
in different zones. Under the headings of Establishment Cost, Maintenance Cost, Cost of
Production, and Returns Realized from Neem Plantation, the costs incurred and returns
realized through time are reviewed. (Muhammad, Y.K., Ilu, K.J., Jibo, A.U., Salami,
K.D. and Ahmed, B., 2020)
Gap- The article is written in view of the labors in Nigeria the economic and socio-
economic conditions alongside the Government policies may not be same as that of India.
Thus, all the factors in question need to be investigated in terms of Indian laborers before
concluding the same implication for Indian Farmers/ labors.

• For optimum amount of extraction of neem oil with the usage of mechanical pressure of
5000psi at room temperature is recommended. This finding can be used in the company

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 to regulate temperature during the neem oil processing. (Pascoli, M., Jacques, M.T.,
Agarrayua, D.A., Avila, D.S., Lima, R. and Fraceto, L.F., 2019)
Gap- Golden Agro Industries doesn’t use the mechanical pressure for neem oil processing
as of now. The company’s R& D department needs to do a detailed research/analysis on
implementing the above change and the impact it would bring on the existing machinery.

• The introduction of neem oil GNFC project reduced migration, increased income and to
enhance women's role in their family's decision making. Also, domestic violence reduced
and women empowerment was initiated. This shows that such empowerment projects can
have a huge impact on the society and economy as a whole. (Soetaredjo, F.E., Budijanto,
G.M., Prasetyo, R.I. and Indraswati, N., 2008)
Gap- The GNFC project was implemented in Gujrat wherein there was a positive impact
on the socio-economic condition of the women in the neem fruit collection. However, the
due to the culture difference in Maharashtra region the growth and development of the
women may not be perceived in the same manner in another regions.

• The article reinstates the observation in the above article. It highlights the success of
GNFC program, whose model can be replicated for other similar projects. It also
mentions the challenges such as sourcing, storage, extraction and quality control, forward
integration which need to be overcome with strategic innovations for other projects
(Pascoli, M., Jacques, M.T., Agarrayua, D.A., Avila, D.S., Lima, R. and Fraceto, L.F.,
2019).
Gap- Whenever there is a difference in the location of operation there is a possibility to
have different variants impacting the overall process of neem oil extracts. There might be
different challenges for different locations. However, the learnings from the GNFC
project can be utilized to reduce the risk of failures.

• National Bank for Agriculture and Rural Development (NABARD) is playing a pivotal
role in promoting and development of agriculture and integrated rural development in
state of Himachal Pradesh. The external agencies are supporting RRBs commercials

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banks and other RBI approved financial institutes also help in extending support for rural
economy and development. A similar model can be extended to Maharashtra which can
help the NGO collecting neem fruits and drying to build more sophisticated
infrastructures for neem fruit procurement and processing of neem oil. (Pierre, G.,
Dubessay, P. and Michaud, P., Influence of Physicochemical Characteristics of Neem
Seeds (Azadirachta indica A. Juss) on Biodiesel Production.
Gap- The state Government priorities in implementation a particular agriculture-based
project may vary. In there the Golden Agro Industry is an Individual proprietor owning a
private company which might cause the roadblock in getting RBI approval for conducting
such projects.

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RESEARCH DESIGN AND STRATEGY

Qualitative research approach would be suggested to go ahead as the research methodology. The
following sections would help in justifying the selection of the research methodology.

Rationale for using the Type of Research methodology-

The research design proposed for the ABR project titled “Strategic Improvement in Supply
Chain Model for Neem oil production” is Qualitative analysis in context of the how the
Information would be sought.

Qualitative analysis would help in depth analysis of the neem oil production supply chain. The
macro-level (external environment), industry-level, company-level and stakeholder-level
analysis could enable the research with understanding of the current success factors and
influence on the supply chain of neem oil production.

On basis of Objective, it’s Exploratory research. The research focuses on the exploratory design
very few previous researches conducted on the research problem which can be used to predict an
outcome. This design would help in gaining background information and address different
research question such as what, why, how etc. In this kind of researches, the research problem is
vaguely defined but during the research the research priorities and area of resource allocation is
established.

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At the application front, this project uses Applied research as a basis since there is an existing
problem and the research would help in solving the practical problems of the modern world
rather than just acquiring knowledge.

Quantitative Research-

The Quantitative analysis would help in providing the initial data required to go ahead with the
next step of the Project. There are a lot of secondary data available on the internet and other
public domains which can provide insights about the on-going research and surveys done
regarding Neem Project and this effectiveness.

Qualitative Research-

The major highlight would be on the qualitative research since its exploratory research. As part
of exploratory design where the focus would be understanding first the Environmental, Industry,
Company overview. Post the initial qualitative analysis the pain points of all the processes
involved in the neem oil extraction and other problem minute details could be studied to deep
dive into precise factors affecting Neem oil production. A new strategy or insight in the ongoing
project can be expected post the qualitative analysis.

The methods proposed to be used for this research is SWOT analysis, along with root cause
analysis for TOWS.

The above qualitative analysis could help identify the key stakeholders such as the collectors,
labors, NGO workers (who are directly involved in procuring the dried fruits from labors),
company management team and staff and their expectations. This could also identify the Key
success factors which can majorly impact the existing Supply chain and the production of Neem
Oil in Golden Agro Industry.

With this a descriptive understanding and analysis, we would be able to identify the key
strategies and their priorities to come up with a favorable solution.

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Research Process-
The research process for the particular project would be inclusive of the following steps-

Identification

Formulate
Hypothesis

Literature
Review

Prepare Research
design

Qualitative Macro level

analysis Analysis

Industry level
Analysis

Company level
Analysis

TOWS analysis

Balance scorecard

Findings and
conclusion
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Identification-

The definition of the information needed for the selected topic is determined using conversation
with consultant experts of the field, observing on going activities of the sector, print materials etc
. This information would help in finding the research problem, which could further guide in
formulating research hypothesis. The correct interpretation of the problem would help in coming
up with the correct conclusion.

Formulate Hypothesis-

Once the research problem is identified the next step is to formulate hypothesis. The hypothesis
is the theoretical statement using in solving logical relationship between various variables, which
could in turn help in solving the stated research problem.

Literature Review-

Preliminary research using different information sources such as research papers, academic
journals, articles on professional journals, websites etc. are performed and all the required
information is gathered. This help in understanding the key findings and understand the previous
works. The gaps could be identified between the previous research performed and the research in
question. The wide range of information obtained via the Literature review needs to be narrowed
down to accommodate the issues at hand.

Preparation of Research Design-

The blueprint of the Research undertaken is designed, which includes work plan of the whole
study. The design helps in building a plan to utilize the resources and come up with a
analysis/conclusion plan. In of the current research project the Qualitative analysis would be
conducted with the available secondary data (research available over internet and relevant
articles) and primary data (interview with the experts).

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Analysis-

The current project is largely dependent on the analysis conducted on various levels i.e., External
environment, Industry level, Company level and stakeholder analysis. The evaluation Matrix is
determined using simple evaluation questions and columns to address the design issues. These
could lead to understanding the SWOT (strength, weakness, opportunity, threats) analysis.

Using these details, the root cause analysis for TOWS is conducted to narrow down to the
important Strategies.

Result and Discussion-

The final result of the research is a balance scorecard which could include all the findings of the
research that can be used to measure the performance of the organization.

The Balance scorecard can be used by the company has a tool to monitor and measure the set
strategies.

Formulation of Conclusions and Recommendations-

As a Conclusion is a statement the solution to the proposed problem based on the findings of the
investigation would be presented. The conclusion will show whether or not the analysis worked.
The conclusion statement would include the plans for the research topics that might need further
research and investigations. It would also include the possible benefits to the company and
society as a whole.

A mixed research approach would be suggested to go ahead as the research methodology which
includes both qualitative and quantitative analysis. However, the major focus would be on the
qualitative analysis. The following sections would help in justifying the selection of the research
methodology.

Rationale for using the Type of Research methodology-

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Quantitative Research-

There are a lot of secondary data available on the internet and other public domains which can
provide insights about the on-going research and surveys done regarding Neem Project and this
effectiveness. The Quantitative analysis would help in providing the initial data required to go
ahead with the next step of the Project.

Questions such as how many labors where part of the Neem project and outcomes of their
involvement in the project. Another one could be how much production/ yield was possible
under Neem Project framework. This would provide us an initial data regarding the neem fruit
collection and neem oil extraction that could help us understand the different variables which are
common for our company and if these can be replicated with the help of available infrastructure
of the company.

Qualitative Research-

The major highlight would be on the qualitative research since its exploratory research. As part
of exploratory design where the focus would be understanding the pain points of all the
processes involved in the neem oil extraction and gather all the problem details. A new change or
insight in the ongoing project can be expected after or during the qualitative analysis.

The methods proposed to be used for this research are Surveys, interviews, focused group and
observation.

The above qualitative analysis could be carried out around a few key stakeholders such as the
collectors, labors, NGO workers (who are directly involved in procuring the dried fruits from
labors), company management team and staff.

Reason to include such kind off qualitative analysis is that the research could get a greater insight
on the ongoing issues. A descriptive understanding will help in having in-depth understanding of
what is a favorable solution.

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RESEARCH QUESTIONS
1. What are the potential solutions to improve supply chain model to increase productivity
of neem oil?
1.1. What is the current supply chain model and possible points of improvement?
1.2. Which is the stage whose improvement would help the supply chain at large?

1.2.1. What type of training, equipment and schemes could be required to facilitate the
collectors/ labors to produce more quality neem oil.

1.3. Who are the main stakeholders who can influence the growth, profit and value add to the
existing supply chain system?
1.4. What are the pain points of the stakeholders?

1.5. What are the factors that could lead to a sustainable model including all the stakeholders
of neem oil manufacturing/ processing?
2. How can we encourage larger number of collectors to be involved in Neem oil
collection?
2.1. What are the factors that would attract more collectors/labors in the region to start neem
fruit collection?
2.2. Is the current incentive model attractive and sustainable enough to encourage Local
residence to improve neem oil production and increase entrepreneur activities among
them?
2.3. What is the marketing technique that can be used to encourage engagement and
involvement of collectors/ labors?

RESEARCH OBJECTIVE
To build a strategic plan to improve neem fruit supply model to get higher production yield by
5% within 2023

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FINDINGS AND DISCUSSION
Macro level External Environmental- PESTE description
To begin the qualitative analysis, the first step taken is under the external environment of Neem
Oil Production Industry in India. Since businesses operate within external macro-environment it
has a major impact over the success/ failure of the industry. The understanding these details
PESTE (Political, Economic, Socio-cultural, Environmental/Ecological) would lead to
understanding true strategic issues that can move the firm forward towards accomplishing its
vision.

Analysis

The different PESTE factors for Neem Oil production are-

Political

1. In 2015, Government of India had allowed fertilizer firms to produce 100% neem coated
urea. The move was made by the Indian government in the benefit of stakeholders such
as:
a. The farmers- who reduce their subsidiary bill by Rs 6500 crore and also boost up
the economy. Since neem coated urea helps in slow release of nitrogen which in
turn helps in maintaining the fertility of the soil for a longer duration. This
indicates that there would be more yield to extend 15-20% and less use of urea to
the extent of 15-20%, resulting in saving of Rs5000 crore for the government.

b. Industry (Urea manufacturer and Neem oil producers)- Earlier India used to
produce 22 million tonne urea and import 9 million tonne to meet the demand.
Now with less wastage of urea with the help of neem oil coating the shortfall can
be meet without import.
In case of the neem oil manufacturers, their product demand has increased since
earlier there as a cap of 35% neem coated urea, after the amendment passed the
neem coating can be done up to 100%.

24 | P a g e
Overall, the Indian Government has taken necessary steps to make amendments in the law,
which resulted in the increased neem oil production. Since there is a government backing the
producers of neem oil can also leverage few more benefits in order to meet the growing demand.

2. The success of the GNFC Project (Gujrat Narmada Fertilizer Company) has led to
increased interest by various State Governments to implement a similar model in their
respective states to increase the neem oil collection and production. States such as Uttar
Pradesh, Maharashtra, Madhya Pradesh, Rajasthan etc. have launched the neem oil
project. This would lead to additional income generation for women and poor economic
background population. Most of the states in India has abundance of neem fruit available
and with the support of Government this raw material can be utilized to meet the growing
demand.

Economic

1. As per the projected forecast neem extraction market is expected to accumulate $2.04
billion with a CAGR of 17.4% between the period 2016 to 2022. The growing awareness
about the harmful effects of chemical-based fertilizers and cosmetics have tilted the
customers interest towards bio-based products. Neem having versatile usage across
various industry production need to be increased accordingly to meet the growing
demand. The revenue generated by this industry would directly affect the economy of the
country. Furthermore, if the quality and quantity of the neem oil can be increased, the
same can be exported to other countries which would have overall impact on the
economy of our country. With additional effort on managing the production quality and
strategic planning on expansion of neem seed collection, Indian manufacturers could be
able to export neem oil across various part of the world (where again there is increased
demand of neem oil).

25 | P a g e
 2. The first step of neem oil production, is neem fruit collection. The majority of the effort
takes place at this stage. There is a huge number laborer required to conduct the activity.
There can be abundant raw material or neem fruit available however if they are not
collected and used for extraction the resource is wasted.
As an outcome of GNFC project it was observed that average income of women in the
villages was around Rs12000/- per year before the project implementation. Post the
project implementation the average income increased to Rs84000/- per year. This
indicates the enormous impact of the Neem project implementation on the low-income
groups.

Social

1. The GNFC Project was a very good example of how a single project of neem fruit
collection has a socio-economic impact in a village. There was an increase in number of
women who own livestock. The neem project encouraged women to become
entrepreneurs wherein they would go to different labors or farmers to accumulate neem
fruits against providing them certain amount. These women entrepreneurs then sell these
neem fruits to local aggregators for storing before using it in manufacturing.
In this process the women entrepreneurs have gained enough revenue to own livestocks
and improve their livelihood.
Another important impact was the improvement in the role of women in decision making
and reduction in domestic violence.

2. With the introduction of the neem project there is reduction in the migration of labors to

26 | P a g e
 different locations during off season. Earlier the laborer used to travel to different
locations in search of alternative jobs mainly during the season April to July when there
was no harvest. Since the neem fruits ripe and are available during the same period of
time it becomes feasible for the labors and farmers to invest their time on collecting neem
fruits and getting their wages based on the amount of neem fruit collected.

Technology

1. There has been continuous R& D in the field of neem oil extraction wherein scientists
are looking for better and efficient methods to extract the purest form of neem oil
without much wastage. Since 280 tons of neem kernel provides only 85 ton of neem
oil, researches are trying to increase production of oil per MT of kernel.
2. Also, there are ongoing researches related to the practices to reduce wastage of the
neem fruit and increase overall utilization of fruit collected. As there would be a lot of
fruits which may not to be up to the mark for usage in medicines however can be used
in soaps and other disinfectants wherein the quality of the neem oil need not be of
very high quality. Such alternatives are being tested and implemented in various
industries.
3. As of now the different technologies available for neem oil extraction are as follows –
a. Mechanical Pressing,
b. Steam Pressure Extraction,
c. Solvent Extraction, and
d. Super Critical Extraction

Environmental

1. India has large number Neem trees across various parts such as Andhra Pradesh, Madhya
Pradesh, Uttar Pradesh, Maharashtra, Gujrat, Karnataka etc. Neem is a fast-growing tree
in arid regions which is also drought resistant. In spite of wide spread presence, as part of
‘The Neem Project’ additional 20 million trees planted. Also, in future the government is
planning to plant more neem trees to support similar projects like this. This will increase
the number of neem fruits availability directly increasing the neem oil production.

27 | P a g e
 2. Neem is also beneficial for environment with respect to the pollution, since it helps in
improving oxygen level. As it grows over in arid and sub humid regions, the tree
regulates the greenery quotient in such regions as well. Apart from that the neem tree is
used as a windbreaker across farms, a source of shade, helps to restore and maintain soil
fertility. Neem tree is also useful in urban forestry due to its remarkable property to
withstand air, water pollution and even heat.
3. Due to all the above reasons Neem tree is regarded as scared in Indian subcontinent. Its
widespread usage in medicine to bio pesticide gives people reason to preserve it and grow
more neem trees in the locality. Since ancient time it is ranked as ‘Kalpavriksha’, wish-
fulfilling tree. Its noteworthy that each part of the neem tree is used for various other
purpose from curing diseases to protecting crops.

Summary

28 | P a g e
Conclusion
Looking at the PESTE Analysis as presented above we observe that Indian subcontinent has
abundant Neem tree plantation and Government itself supports the plantation of more neem tree.
The Government support is not only to increase the greenery quotient but also to increase the
socio-economic gain that the Neem project offers. The neem oil extraction seems to have a win
-win situation with all the stakeholders from grassroot level (i.e., the laborer) till the customers
(i.e., clients) in various ways. With the continued support from Government the industry can
achieve to manage shortfall in the demand gap and produce its indigenous neem oil.
All the components of external environment i.e., Political, Economic, Social, Technology,
Environment indicates that it has a favorable position to prosper and earn more revenue in the
coming days.

Industry’s competitive environment-PORTER’S Five Forces

The competitive environment of an industry can be evaluated using Porter’s five forces. The
porters’ five forces help in identifying and analyzing the five important forces which could be
industry’s strength or weakness. This could ultimately help in understanding the level of
competition within the industry and enhance company’s long-term profitability. The
attractiveness of the industry could be indicated using the favorable conditions determined in the
analysis.

The Porter’s five forces could be applied to the Neem Oil Production industry and the favorable
and unfavorable conditions of this industry would be determined.

29 | P a g e
Threat of new Entrant-Medium

The barrier for entry into the industry is medium as the entrant needs to build the network for
themselves to procure the neem seeds from the seed collectors as a first step. If the entrant is
already in the oil extraction industry, they might have the expertise to extract high quality and
existing clients. This would reduce the level of barriers to enter for such competitor. Here they
could leverage both supply and demand side benefit of scale.

However, since neem oil extraction industry is an oligopoly market attracting new clients would
become a difficult task.

Threat of Substitutes - High

As per the news article(https://www.downtoearth.org.in/news/governance/towards-a-bitter-end-

india-s-neem-shortage-63978) manufacturers are freely blending neem oil with other cheap
varieties of similar constituency, such as palm oil, cotton seed oil and bran oil. This is causing a
lot of issues for the end customers such as farmers and other product manufacturers who use this
extracted neem oil as an ingredient to produce further end products.

The substitute oil is easily available and can garner huge profits when mixed with pure neem oil.
However, it is difficult to totally substitute neem oil with any other oil such as almond, castor
etc., since each oil has its own properties and benefits. For example, the substitute to neem oil

30 | P a g e
could be synthetic pesticides which can be harmful to the nature in long term. But it is not
possible to substitute neem oil with any other oil for Urea coating.

Bargaining power of Customers - High

Since there are lot of manufacturers of neem oil in the market, the customers can influence the
pricing of the neem oil. The best way to lock the customers would be using loyalty programs. By
garnering to the customer requirements with respect to price, quality, quantity and variety the
customer’s bargain power can be reduced to a certain limit.

The company need to be unique by innovating itself on regular basis and have a strong supply
chain alongside a firm market presence. These factors can ensure that the company can retain
and capture a large number of customers.

Bargaining power of supplier- Low

The suppliers here refer to the seed collector and the NGOs who help in collecting the raw
material. There is no particular skillset required to collect the neem seeds. The labors in the seed
collecting can be easily replaced by a different set of labors.

But the current seed collectors can also easily switch to any other daily wage jobs where there is
a better pay. As of now a neem seed collector only earns around 12-25 Rs per kilogram of neem
fruit gathered. Collection of neem fruit is a laborious job and if sufficient wages are not provided
the labors would switch to a better job perspective. Also, in case the NGOs and the other
cooperatives don’t help in providing logistics to transport, the procurement neem seeds from
various households would be difficult leading to a lot of effort to be put by the company to set up
its own network and gain the labor’s trust.

Competitive Rivalry-High

There are lot of competition among the neem oil extractors, from small scale to large scale
manufacturers. There are manufacturers who provide assortment of extracted oil which is an
added advantage for the customer since they can get all their orders fulfilled at one place.

The online presence of the neem oil extractors has increased post Covid. More the advertising
more would be the awareness about the company in the industry, leading to more probability to

31 | P a g e
get customer attention. Innovation and a string research and development team can add to the
differentiating factor for the company.

Summary

Conclusion

Analyzing all the forces for this particular industry it indicates that Competitive Rivalry and
Threat of substitute is high, hence we need to focus on the differentiating factor i.e., quality that
would make the company stand out from other competitor products. The Bargain power of the
buyer is high, but since product quality would attract more and more client base. This because
even the customer would like to have the best quality product.
The Bargain power of the Supplier is low and the industry can leverage upon it and utilize more
labors to procure larger number of raw materials.

Industry level- Competitive profile matrix

An industry level Competitive matrix would assist in understanding company’s position using
visual representation. There can be a clear view how the company in question stand up against

32 | P a g e
competition from specific perspective. The company might be good at one prospect but it might
lack in another aspect.

Analysis

The below template would be filled to understand the most important critical factor across the
industry.

Competitors in discussion are as follows-

Golden Ozone Pradip R.K. Oil Orgo

Weigh
Agro Biotech Agrotech Products Growth
CRITICAL t
India
SUCCESS
WEIGHT

WEIGHT

WEIGHT

WEIGHT

WEIGHT
RATING

RATING

RATING

RATING

RATING
FACTOR
SCORE

SCORE

SCORE

SCORE

SCORE
ED

ED

ED

ED

ED
Quality of 3.75 1.87
0.5 4.5 2.25 3 1.5 3.5 1.75 4.5 2.25
product 5

Continuous 3.5 1.05

R&D with
0.97
process 0.3 4 1.2 3.25 3.5 1.05 4.5 1.35
5
improvemen
t

2.5 0.5
Reachability
0.2 4 0.8 2.5 0.5 4 0.8 4.5 0.9
to customer

3.42
5
TOTAL
2.97
4.25 5 3.6 4.5

*Rating done on the scale of 1-5

Ozone Biotech and Orgo Growth are leading companies which can be benchmarked

33 | P a g e
Ozone Biotech- The company is a leading manufacturer of Pure Neem Oil and Neem oil-based
insecticide in India. It is based out of Faridabad, Delhi in 2001, having a wide range of products
such as Pure Neem oil, Neem oil insecticide, Neem cake, Azadirachtin powder and Karanja
seed-based products. They also produce neem oil suitable for various different industries
agriculture (crop protection and fertilizers), pharmaceutical (human and veterinary) and
Cosmetics.

The company is ISO certified and its aim is to provide best quality products which are organic,
non-toxic and strive towards customer satisfaction.

Pradip Agrotech- The company was established in 1993 in Navi Mumbai, Maharashtra. There
is a wide range of neem products available from neem cake, neem powder, neem oil to neem
fruits. Apart from that the company has a strong portfolio in other non-edible seed business as
well. They produce products whose raw materials are cotton seed, castor, Karanja etc. The
company has an establish infrastructure for processing the neem seeds and an establish client
base near its base location.

R.K. Oil Product- With the company base in Indore, Madhya Pradesh the company operates
from one single location including its team of expert professionals. The company focuses on
striving customer satisfaction with its range of products derived from various non edible seeds
such as neem, Karanja, Jatropha, Mahua. The company was established in the year 1989 with a
client centric approach and having a large product line as this differentiating factors.

Orgo Growth-Orgo growth is a Private limited company who has 35+ products in plant nutrient
management and soil management. The company is ISO certified and takes at most care in
keeping the quality standard using SOP (Statement od Operating Procedures). The company is
focused on producing quality standard product with competitive pricing. The state of the art
Infrastructure, high skill team of experts to provide bio based fertilizers as a substitute to
chemical inputs.

Looking into the company profile the following success factors were found critical for a Neem
Oil Manufacturing company-

34 | P a g e
Quality of Product- This is one of the most important success factors among all others. The
quality of the neem oil would ensure that the client continues to stay with the company for future
business as well. It’s important to maintain the quality level for each batch and have continuous
check on the extraction process.

As per the research the neem oil should have minimum of 300ppm azadirachtin to show some
effect as a pesticide/ insecticide. There are other neem oil manufactures who produce neem oil
with varying azadirachtin content from 300 to 50000ppm as well. More the quantity of
azadirachtin more would be its effectiveness.

The companies in question produce varying azadirachtin content, the rating has been given on
the basis of the ability to produce neem oil with highest azadirachtin content. As per the
company profile Orgo growth and Ozone Biotech produce a minimum of 3000ppm to
50000ppm. Both the companies are ISO certified that provides customers an assurance on the
quality of the product produced. The customers can then trust these products without having
doubt regarding substandard or other substitute product being mixed.

As per the customer perseverance too the companies are rated high on their quality.

In comparison to that Golden Agro produces neem oil to up to 3000ppm, which is also a high-
quality product in the market. But there is still scope of improvement to increase the amount of
ppm of azadirachtin, hence the rating. Also, a backing of ISO certification could help the
company get instant trust from the customers.

Continuous R& D with process improvement- The companies who are in the competitive matrix,
all have their own research and development department at the company level, however level of
research conducted and the frequency in which the changes have been brought into the product
varies from company to company.

Both Ozone Biotech and Orgo growth have good experienced professional who are continuously
involved in the latest R& D operations of the company and work continuously in bringing up
changes in the ways of product manufacturing or product itself. It’s a common observation that
larger the company in terms of its production capacity more can the company invest in bringing

35 | P a g e
up further investment on R& D activities. Since R.K. Oil Products and Pradip are small scale
manufactures its not always feasible to have continuous investment for R&D.

In case of Golden Agro, this has been a differentiating factor for the company to continuously
bring up changes in their production method and product quality. With help of experience
professionals at the company, the company is able to build up on the product development and
the processing front.

Reachability to customers- Once the products are manufactured the next stage is to reach out to
the customers to sell the products, hence the accessibility and feasibility to reach out to the
customers become pivotal. The companies need to increase both its customer base and ensure
that customers are receiving the product regularly with required time frame.

There both promotion and logistic would come into picture. Promotion to attract more customers
and logistics to deliver the product at the location of customer demand. Comparing the
companies in the competitive matrix, almost all the companies have a good connectivity to
transport the goods to the customer location which would be done by delivery agents or using the
company’s own logistic team. But promotion becomes crucial, since the bargain power of the
consumers is high (as per Porter’s Five Forces analysis) the company needs to be prominent
enough to be noticed and reach out.

Most of the small manufactures of neem oil have an account on IndiaMart, which is India’s
largest B2B marketplace where buyer and suppliers are connected. The companies display their
products with description and price. However, if the company has its own website that would
provide customers a better insight on the company’s overall profile and its USP (Unique selling
Proposition).

In the pre-Covid era the small manufactures would go to different customers to promote their
products, however now it has become very important to have an online presence and the
company stays connected with the customers when they reach out. Golden Agro still follows the
conventional method of promoting its products offline. Hence its key factor for the company to
ramp up its online presence and have its own website and team who can provide continuous
support regarding its product.

36 | P a g e
Conclusion
Ozone Biotech and Orgo Growth both can be benchmarked for neem oil extraction since the
overall rating of all the critical success factors is high. Golden Agro Industries having a strong
R& D background and quality should focus on improving and increasing the customer reachability
so that it can increase its client base and gain more revenue as an end result.

Company Level-SWOT Analysis

The SWOT analysis helps to draw the most important information into a format that can then be
used in strategic management. The SWOT would help in determining the strategic issue the firm
needs to address and resolve. This analysis tool is helpful in the next phase of strategic
management to set strategies. The SWOT framework would provide the Strength Weakness
Opportunity Threat of a particular company, which would in turn help in comparing the internal
and external factors to generate idea about how the firm could be successful.

The Evaluation Design Matrix is an essential planning, evaluation and organizing tool. This
design matrix links each evaluation question to the means for answering the questions. In case of
Neem Oil production various projects and companies would be taken into account. The critical
success factors would be used to identify the most useful one using weights and ratings.

This outcome would ultimately help in identifying which actions are performed correctly in the
firm and which need improvement. The below Evaluation Matrix template would be used to note
down the Strength Weakness Opportunity Threat alongside the Weightage and ratings of each of
these factors.

37 | P a g e
Analysis
The SWOT analysis with Evaluation Matrix has been carried out and following are the
outcomes
Internal Factors Evaluation Matrix External Factors Evaluation Matrix
Weighted

Weighted

Weighted

Weighted
Weight

Weight

Weight

Weight
Rating

Rating

Rating

Rating
Score

Score

Score

Score
Strength Weakn Opportun
Threats
s esses ities

O1-
W1-
S1- Growing
Restrict T1-
Presence demand
ed Suscepti 0
of 0. 4. 1.1 0. 0. for bio 0. 2. 0.
location 3 1 bility 3 .
operatio 25 5 25 2 6 pesticide 4 5 2
of towards 6
ns at one and
operatio infection
location natural
n
cosmetics

S2-
Strong W2- O2- T2- 1
3
network 0. Limited 0. 1. Abundant 0. 0. Climate 0. .
4 0.4 4 2 .
between 1 client 3 2 Raw 2 4 change 3 0
5
stakehol base material Impact 5
ders

O3-
W3-
Entreprene T3-
Low
S3-Good urship Constrai 0
0. focus of 0. 0. 0. 0. 0.
Product 4 1.2 2 inducing 3 nts in 2 .
3 skill 1 2 1 3 1
quality expansion procure 2
develop
of ment
ment
business

W4-
T4-Lack
S4- Limited
of
Strong machin O4- 0
coordina 1
R&D 0. 3. 0.8 ery and 0. 2. 0. Abundant 0. 0. 0. .
3 tion .
backed 25 5 75 capacity 3 5 75 Availabilit 2 6 1 1
among 5
manufact to y of Labor 5
Stakehol
uring manufa
der
cture

38 | P a g e
 W5- O5-Global T5-
S5-
Limited focus on Many 1
Establish 0. 0. 0. 0. 3. 0. 0.
4 0.4 Product 2 product local 4 .
ed 1 1 2 1 5 35 3
assortm developme Competi 2
company
ent nt tors

3
2. 2.
Total 4 Total .
95 65
2

*W - Weights are industry based. Least important = 0, Most important = 1. All the ratings are done
on the scale of 1-4
WS – Weighted Score (W x R)
The Internal Factor Evaluation Matrix- The evaluation indicates that company can easily capitalize
on its strength (4). Even tough the weakness are very low (2.95) the company should take measures
to convert them into strengths.

The External Factor Evaluation Matrix- With respective external factors the company should take
immediate actions on minimizing the threats (3.2) and converting them into strengths. There is
ample amount of opportunity (2.65) in the market, however the company should take strategic
decisions to convert them in favor of the company’s growth.

Summary

39 | P a g e
Conclusion
On the basis of the SWOT analysis using evaluation matrix the following are the interpretation-
1. The Strength of central operation of the company and good network connection between the
stakeholders should be leveraged.
2. The company has a lot of scope in capturing the markets by expanding on its client base and
promoting its products online as well
3. The positioning of the company can be made to perceive it as a high quality product
producing company making it as a differentiating criterion to compete with the other local
competitors.
4. Improvement can be brought in the products using various R& D techniques to increase the
product quality to a level so that company can enter into global market and export it.
5. Finding innovative solution for encountering threat of climate changes and diseases on the
raw material can act as a differentiating criterion in the neem oil industry.

40 | P a g e
Analysis of Stakeholders
The list of the stakeholders and their exception with their level of power are stated below. The
analysis would help in analyzing the stakeholder needs and deliver quality products. This will
ultimately build a strategic view of possible of stakeholder’s issue.

Vision of Golden Agro

To provide high quality organic product with continuous improvement across India

Mission of Golden Agro

To provide organic, economical, non -toxic quality non edible seed products to customer for
healthier life

Corporate Objectives of Golden Agro

To introduce strategic improvement in neem oil production model to get higher production yield
by 5% within 2023

Analysis of Stakeholders

Name of the stakeholder Their Expectations Their Power

1. Stakeholder1 Earn enough money to sustain Seed collection is first step

livelihood in extracting neem oil.
No migration during non- The greater number of seed
agriculture period collector more oil can be
extracted to meet the
No or less cost involved in
industry demand
activities
Low power, high interest
Easy mode of transportation
and getting paid

Individual Seed collectors (Women, landless laborer, farm laborer, small and marginal
farmers)

41 | P a g e
 Name of the stakeholder
2.Stakeholder2
Village level collection Center (includes Sakhi Mandal, NGO, Milk Cooperation)
Name of the stakeholder
3. Stakeholder3
Company and its employee
Their Expectations
Help the seed collectors in
storing and transportation of
neem seeds from various
individuals.
Receive amount in turn of the
storage and logistics in some
case to continue its
sustainability
Their Expectations
Receive profit
Retain and Able to meet up
the expectation of Client
Meet the demand of client
Provide high quality products
with minimum cost/expense
Their Power
Train and provide various
kind of support to rural
women and labors to
continue seed collection at
district level
Absence of the stakeholder
will lead to
mismanagement and lot of
unorganized seeds
collection without proper
storage conditions,
medium power, high
interest
Their Power
The neem oil extractors are
one level below the product
manufactures
They can bargain with the
prices against the quality,
however there are many
suppliers in the market which
they need to be cautious
about. The Bargain power is
low
Low power, high interest
42 | P a g e
 Name of the stakeholder Their Expectations Their Power

4. Stakeholder4 High quality product Bargain power is high,

since there are lot of
Cost effective and value for
suppliers
money
Need to get a good quality
Meet the regular demands on
product to retain its
timely basis
consumer
Able to get assortment of oil at
High power, high interest
one place

Client / Manufactures

Name of the stakeholder Their Expectations Their Power

Competitors Benchmark their product Capture more client base

against Golden Agro, than Golden Agro
introduce differentiating
High power, high interest
factors

Name of the stakeholder Their Expectations Their Power

Government Induce socio economic Change government

growth regulation and taxes to
influence neem oil
Low-income level population
production
income opportunity
Low interest, high power
Fulfill gap of demand and
supply of neem oil

43 | P a g e
 Name of the stakeholder Their Expectations Their Power

Society Receive quality neem oil Influence demand and

produce for healthier living supply cycle of neem oil
Low interest, low power

Conclusion

There are many stakeholders in the supply chain of neem oil production as mentioned in the
above Stakeholder Analysis grid. The management and fulfilling the expectation of these
stakeholders is a challenging task, however as seen from the PESTE analysis in the above section
the overall impact of the neem oil production industry is beneficial to whole community.

The knowledge of the stakeholder analysis can now be used to formulate the action plan so that
the actions designed would help in fulfilling the expectations of the stakeholders.

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TOWS Root Cause Analysis
The TOWS analysis is built on SWOT analysis that allows to think about strategies in and
around internal and external areas. The tool is to be used to have a wider picture and start
developing strategies. Its noteworthy to use the PESTE and Porter’s Five forces model to
determine the macro environmental factors analysis easier.

The SWOT is utilized to build strategies using four strategic groups- SO, ST, WO and WT.
Further the strategies are developed by addressing the following areas-

1.SO(Maxi-Maxi)-How to leverage strength to maximize benefit from opportunities?

2.ST(Maxi-Min)-How to leverage strength to mitigate the threats in marketplace?

3.WO(Min-Maxi)-How to utilize opportunities to overcome weakness?

4.WT(Min-Min)-How to mitigate threats to reduce impact of the weakness?

The combinations of all the Strength, Threats, Weakness and Opportunities are mapped in the
matrix with the type of Strategy & Implementation model and Section of Balance Scorecard
(Market Development, Product Development, Differentiation, Cost Leadership, Focus).

Strength Root Cause Analysis

Neem trees widely available in Sangli district of MAHARASTRA
Presence of operations Machinery and transportation already established
at one location Fruits readily available without any invest on the plant
Different stakeholders well connected for end-to-end process
Transportation from household available via NGO and VLCC
Strong network between consuming minimum distance
stakeholders NGO and VLCC connected to company's storage
State of the art machinery used for extraction
Processes supervised and handled by experienced professional
Good Product quality 1500ppm Azarachdin quality of neem oil extract
Quality check at each batch of the manufactured product
Company leads with experienced industrialist
Strong R&D backed Adequate budget allocated for R& D and process improvement
manufacturing Introduce new machinery to improve cycle time and quality
Established company 10 years in business

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 High quality product and safety measures taken
High retention rate of customers
Weakness
The operations are limited to only Sangli region, no alternative site
Restricted location of Seed collection, manufacturing takes place at limited area of
operation operation
Operating with very few set of clients over the years
Limited client base Low focus on capturing larger number of clients
Daily wage workers, labor for seed collection is unskilled laborer
No former training, hence not aware of the do and don’ts of neem
fruit collection
Low focus of skill Collection of fruit contain dirt, quality of fruit selected might be
development poor
Limited machinery and Operation in single region, limited number of machineries is kept
capacity to manufacture Lack of optimum utilization of machinery
Company has limited product on the basis of non-edible seeds
Limited Product Clients prefer to have one stop model to get various assortments of
assortment seeds
Opportunity
Growing demand for bio CAGR 17.4 growth in 2016-2022 projected
pesticide and natural
cosmetics Usage in cosmetic ayurveda biopesticide
Readily available in villages
200million plus trees in the region
Can introduce new neem seed extraction plant where seeds and
machinery available
Abundant Raw material No added cost in cultivation, natural growth
Entrepreneurship Igniting social growth encouraging women entrepreneur
inducing expansion of Provide lower-level income group earning opportunity
business Increase communal growth
Every family member can collect neem fruit and get incentive
against the fruit collected
Potential to attract more labor
Abundant Availability Associate themselves with NGO get added advantages on income,
of Labor health etc.
Extensive ongoing R&D around the world to improve quality and
cycle time
Global focus on product High tech machinery can improve the rate and quality of neem oil
development produce
Threat
Various fungal diseases Powdery Mildew, damping off, Leaf Web
Blight etc. can infect the neem fruit produce and decrease the
Disease infection quality of fruit produced

46 | P a g e
 Impact several communities and economic growth
Quality of the neem fruit is impacted
Fruit rot and trees dry up reducing number of neem seeds to be
procured
Untimely rain and weather change impact the growth of the neem
fruit
Climate change Reduces the quality and amount of neem fruit that can be procured
Neem needs to be storage in a location for a fix amount of time
after which the oil of neem seeds would have high quality
Storage location need to be properly maintained and seeds need to
be carefully transported
Constraints in Drying needs to be done to correct percentage, only 8% moisture
procurement allowed
Less seed collectors, backing out as collectors due to less payment
Miscommunication between the stakeholders, discourage further
Stakeholder synergy participation
Less differentiating factor available
Price war-->many competitors can compete for same client
Other larger competitors can take up the growing demand
Since less assortment available, client tend to move to shop at one
Many local Competitors place

On the basis of action plans, the four perspectives of Balanced Scorecard are identified along with
strategy.

P = Production (Internal Process) C = Customer L = Learning & Growth F = Finance

Strengths Weaknesses

1 1
Internal
2 2
External
3 3

4 4

Opportunities SO (Maximize – Maximize) WO (Convert – Maximize)

1 Action Plans Action Plans

2 S1O1 W1O1

3 S1O2 W1O2

47 | P a g e
 4 S1O3 W1O3

S1O4 Continue to match S2, S3 W1O4 Continue to match W2,

and S4 with all opportunities W3 and W4 with all
opportunities

Threats ST (Maximize – Minimize) WT ( Convert – Minimize )

1 Action Plans Action Plans

2 S1T1 W1T1

3 S1T2 W1T2

4 S1T3 W1T3

S1T4 Continue to match S2, S3 W1T4 Continue to match W2,

and S4 with all threats W3 and W4 with all threats

TOWS MATRIX – SO - Matching Strengths with opportunities

The strengths need to be matched with the Opportunities by exploiting them to the fullest and
create an action plan.

Internal
Strengths
External
Opportunities
O1-Growing demand for bio pesticide and natural S1-Presence of operations at one
cosmetics location
S2-Strong network between
O2-Abundant Raw material
stakeholders
O3-Entrepreneurship inducing expansion of business S3-Good Product quality
S4-Strong R&D backed
O4-Abundant Availability of Labor
manufacturing
O5-Global focus on product development S5-Established company
Balanced
SO (MAX-MAX) Action Plans Strategy
Score Card
S1O1: Increase production capacity and labor Market Penetration Production

S1O2: Explore mechanized collection of neem fruit Market Penetration Production

S1O3: Launch champaign to encourage more women

Market Penetration Production
entrepreneur

48 | P a g e
S1O4: Campaign to attract more labor to collect neem fruit Market Penetration Production

S1O5: Ample resource to experiment to find best extraction

Focus Strategy Production
process

S2O1: Increase number of stakeholder at each level

Market Penetration Production
proportionately

S2O2: Expand the area of business/ cultivation Market Penetration Production

S2O3: Motivate and Encourage more entrepreneur Market Penetration Production
S2O4: Motivate and encourage more labor Market Penetration Production
S2O5: Keep Involved-Educate and communicate Learning &
Differentiation - USP
stakeholders about new innovation in the field Growth
Learning &
S3O1: Value based positioning, good quality product focus Differentiation - USP
Growth
Cost Leadership –
S3O2: Produce large amount of good quality product Production
Lean Management
S3O3: Provide bonus incentive, Entrepreneur utilize the
Market Penetration Production
maximum available labor in their vicinity
S3O4: Training Camp-Encourage Employee committee to Learning &
Differentiation - USP
have focused neem collection Growth
S3O5
Cost Leadership –
S4O1: R& D to maximize quality extraction Production
Lean Management
S4O2
S4O3
S4O4
S4O5: Launch upgraded product-Utilize upcoming R&D
Product Development Customer
technics to expand into global market
S5O1: Marketing team to advertise and attract new clients Market Penetration Customer
S5O2: Improve efficiency to exploit resources-create value
Differentiation - USP Customer
proposition
S5O3: Training Programs-Mentor and train new Learning &
Differentiation - USP
entrepreneur Growth
S5O4: Encourage more participation-by penetrating rural
areas Scheme to provide incentive and other non-financial Market Penetration Production
benefits to laborer
S5O5: Launch upgraded product-Utilize upcoming R&D
Product Development Customer
technics to expand into global market

49 | P a g e
 Market
penetration
11
Focus 1
Differentiation 5
Cost
leadership
2
Product
development
2

TOWS Matrix – ST- Matching Strengths with Threats

The strengths are matched with the threats to minimize its impact, the action plan is created.

Internal
Strengths
External

Threat

T1-Susceptibility towards infection S1-Presence of operations at one location

T2-Climate change Impact S2-Strong network between stakeholders

T3-Constraints in procurement S3-Good Product quality

50 | P a g e
T4-Lack of coordination among
S4-Strong R&D backed manufacturing
Stakeholder

T5-Many local Competitors S5-Established company

ST (MAX-MIN) Action Plans Strategy Balanced Score Card

S1T1: Plantation program at village level-
Market Penetration Production
young and strong tree every year
S1T2: Alternative neem plantation area- Cost Leadership –
Production
Reduce dependency on one area Lean management
S1T3
S1T4

S1T5: More number product offering in Differentiation -

Customer
comparison to other competitor USP
S2T1: Joint venture with other company-
Focus on areas where no disease infected-- M&A Finance
Transport labors
Cost Leadership –
S2T2: Focus on plantation from other area Production
Lean management
S2T3: Training /Educate on Quality check at Differentiation -
Learning & Growth
each level-SOP established USP

S2T4: Community Bonding-Organize Differentiation -

Production
festivities to celebrate yield USP

S2T5: Benchmark stakeholder hierarchy

Market Penetration Production
with competitor hierarchy
Differentiation -
S3T1: Train labor to inspect trees Learning & Growth
USP
Cost Leadership –
S3T2: Employee labor from different region Production
Lean management
Differentiation -
S3T3: Train labor with SOP Learning & Growth
USP
S3T4: Increase interaction among Differentiation -
Production
stakeholders, Community bonding USP
S3T5: Incentives for quality neem fruit to
Market Penetration Production
laborer
Product
S4T1: R&D on Disease resistant plant Finance
development

51 | P a g e
 S4T2
Cost Leadership –
S4T3: R&D on lean management create SOP Production
Lean management
S4T4
S4T5: Positioning of product as innovative Differentiation -
Production
product USP
S5T1
S5T2
S5T3: SOP design and train employees for Differentiation -
Learning & Growth
producing superior quality product USP
S5T4: Regular meet with the stakeholder to Differentiation -
Production
understand their needs USP
S5T5: Make use of the marketing strength to Cost Leadership –
Production
distinguish and not engage in any price war Lean management

Market
penetration
3
M&A
1
Differentiation 9

Cost
leadership
5
Product
development
1

TOWS MATRIX – WO –Convert Weaknesses in to Strengths and match the converted Strengths with
Opportunities

As weaknesses are internal controllable factors, plan can be created to convert them into
strengths which can later be matched with the opportunities.

Internal
Weakness
External
Opportunities

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O1-Growing demand for bio pesticide and
W1-Restricted location of operation
natural cosmetics

O2-Abundant Raw material W2-Limited client base

O3-Entrepreneurship inducing expansion of

W3-Low focus of skill development
business

W4-Limited machinery and capacity to

O4-Abundant Availability of Labor
manufacture

O5-Global focus on product development W5-Limited Product assortment

Balanced
WO (CONVERT-MAX) Action Plans Strategy
Score Card
W1O1: Optimum utilization of machinery with tie Cost Leadership – Lean
Production
up other company in different region Management
W1O2: Introduce tool for collection- maximize
Differentiation Production
utilization of resource
W1O3: Explore new location for expanding
Market Penetration Production
business for increasing production units

53 | P a g e
W1O4: Campaign to encourage more collectors in
Market Penetration Production
the region
W1O5: R&D on optimum utilization of machinery
Differentiation - USP Production
and processes
W2O1: Increase Online presence to capture interest Market Development –
Customer
of core client Porter’s Diamond Model

W2O2

W2O3

W2O4

W2O5: Introduce differentiating factor with global

Differentiation - USP Customer
technology to attract client
W301: Train/educate stakeholder about the neem
Differentiation Production
processing
Cost Leadership – Lean
W3O2: SOP designed to collect neem fruit Production
Management
W3O3: Train the trainer-Train entrepreneur to train
Differentiation Production
collector
W3O4: Train/educate stakeholder about the neem
Differentiation Production
processing
W3O5: R&D to create SOP design to collect neem
Differentiation Production
fruit
W4O1: Tie up with another company from different
M&A Finance
region using extraction machinery
W4O2: Increase production capacity -Capital
Market Penetration Production
investment
W4O3:
W4O4: Utilize the labor in one area to share Cost Leadership – Lean
Production
resource for another company Management
Cost Leadership – Lean
W4O5: Ensure optimum utilization of machinery Production
Management
W5O1: Diversification in other low-cost product
Product Development Customer
segment
W5O2: Create Synergy-Tie up with another
M&A Finance
company with for products competency building
W5O3: Encourage entrepreneurs to take other seed
Market Penetration Production
collection activity
W5O4: Utilize labor when there is off season for
Product Diversification Production
neem for another plantation

54 | P a g e
 W5O5: R& D to utilize the same extraction Cost Leadership – Lean
Production
machine for different seed oil extraction Management

Market
penetration
4

Market
development
1
Differentiation 7

Cost
leadership
5
Product
development
1
M&A 2
Product
Diversification
1

TOWS Matrix – WT – Convert the Weaknesses into Strengths and Match Converted strengths with
Threats

As weaknesses are internal controllable factors, plan can be created to convert them into
strengths, which can later be matched with the threats so that they are fully dealt with.

Internal
Weakness
External
Threat

T1-Susceptibility towards infection W1-Restricted location of operation

T2-Climate change Impact W2-Limited client base

T3-Constraints in procurement W3-Low focus of skill development

W4-Limited machinery and capacity to

T4-Lack of coordination among Stakeholder
manufacture

T5-Many local Competitors W5-Limited Product assortment

55 | P a g e
 Strategy & Balanced Score
WT (Convert -MIN) Action Plans
Implementation Model Card

W1T1: Plan to have alternative operation for the year Cost Leadership – Lean
Production
to another region Management

W1T2: Plan to have alternative operation for the year Cost Leadership – Lean
Production
to another region Management

W1T3: Training labors with SOP to procure Differentiation - USP Production

W1T4: Increase community bonding-Regular

Market Penetration Production
Festivities and connects with stakeholders

W1T5: Tie up with other local competitors M&A Finance

W2T1: Advertise client the precaution steps taken Differentiation - USP Customer
W2T2: Highlight client the alternative steps taken Differentiation - USP Customer
W2T3: Highlight client the internal process checks
Differentiation - USP Customer
taken
W2T4: highlight client the communal growth due to
Differentiation - USP Customer
the product brought by them
W2T5: Focus on the differentiating factors Differentiation - USP Customer
W3T1: Train collectors to identify disease infection Learning &
Differentiation - USP
and necessary steps to be taken Growth
W3T2: Train collectors to identify best fruit and Learning &
Differentiation - USP
necessary steps to be taken Growth
W3T3: Incentivize bringing huge quantity and quality
Market Penetration Production
fruits
W3T4: Standardize rate for neem fruit of particular Cost Leadership – Lean
Production
quality across various location for laborer Management
W3T5: Create differentiating factor based on the fruit
Differentiation - USP Customer
quality
Cost Leadership – Lean
W4T1: Focus on other seed oil extraction Production
Management
Cost Leadership – Lean
W4T2: Focus on other seed oil extraction Production
Management
Cost Leadership – Lean
W4T3: Tight control over processes Production
Management
W4T4
W4T5

56 | P a g e
 Cost Leadership – Lean
W5T1: multiskilling labor with other seed extraction Production
Management
Cost Leadership – Lean
W5T2: multiskilling labor with other seed extraction Production
Management
W5T3
W5T4: Utilize the stakeholder for other fruit Cost Leadership – Lean
Production
collection Management
W5T5: Launch new product (seed oil) in market Product Development Production

Cost
Leadership
9
Differentiation
9
Market
Penetration
2
M&A
1
Product
development
1

57 | P a g e
Balanced Scorecard
Lastly using the frequency of each strategy across all the TOWS matrix the Balance scorecard
with the different strategies would be determined.

The balance scorecard is a performance matrix to identify and improve various business
functions and their outcomes. The initial data collection is important here to provide a
quantitative result which are gathered by managers and executives of the company. The
company can use this table to make better decision for future of their organization.

At the end the Balance scorecard would be created under different Balance scorecard type such
as financial perspective, customer perspective, Internal process and learning and growth
perspective for the strategies deduced for the TOWS matrix.

Analysis
Strategy Action Recurring Capital Measure Primary MIS
Plan Expenditure Expenditure ment Responsi Reporti
Bud Act Varia Bud Act Varia Model bility ng
get ual nce get ual nce
Market S1O1: Rolling Producti Monthly
Penetrati Increase Budget on Busines
on productio Manager s
n to Perform
catering ance
market
demand
Market S1O2: Inventor Procure Monthly
Penetrati Explore y ment Producti
on mechaniz Manage Manager on
ed tool ment Report
for
collectio
n of
neem
fruit for
increased
productio
n
Market S1O4: No of Human Monthly
Penetrati Launch labour Resource Inventor
on Campaig participa y report
n to tion
attract
more

58 | P a g e
 labor to
increase
collectio
n of
neem
fruit
Product S3O4: Lean Procure Monthly
developm Training manage ment Quality
ent Camp- ment Manager Report
Encourag
e
Employe
e
committe
e to have
focused
neem
collectio
n
Market W1O3: Porter's CEO Monthly
Penetrati Explore diamond Project
on new model Progress
location report/
for Monthly
expandin Busines
g s
business Perform
for ance
increasin
g
productio
n units
Product S4T1: Rolling Finance Return
Develop Invest budget Manager on
ment R&D for product
disease develop
resistant ment
plants expense
Product W5O1: BCG R&D and Monthly
developm Diversifi marketin Sales
ent cation in g Report
other
low-cost
product
segment

59 | P a g e
 Product W5O4: Lean Procure Producti
Diversific Utilize manage ment vity
ation/ labor ment Manager Improve
concentri when ment
c there is Report
diversific off
ation season
for neem
for
another
plantatio
n
Product S4O5: Lean Innovatio return
developm Launch manage n Lead on
ent upgraded ment product
product- develop
Utilize ment
upcomin expense
g R&D
technics
to
expand
into
global
market
Differenti S3O1: USP Marketin Monthly
ation Position g Sales
the manager Report
product
as
organic,
superior
quality,
non toxic
Differenti S5T3: Lean Procure Monthly
ation SOP manage ment Quality
design ment Manager Report
and train
employe
es for
producin
g
superior
quality
product
Market W4O2: Rolling Finance Monthly
Penetrati Increase Budget Manager Busines
on productio s
n

60 | P a g e
 capacity Perform
-Capital ance
investme
nt

*Company to fill in details of budgeted amount and actual amount

1. S1O1: Increase production to catering market demand- The action plan is designed to
utilize the existing strength of the company which is having centralized operations and
enhancing it with the growing demand for neem oil in the global market. The company
already produces product which are in demand however the market share is low due to which
the action plan need to be formulated to exploit the market potential by using market
penetration Strategy. The implementation of this strategy could be to first identify the
location of market with high potential and stepping up the production accordingly. In case
there is a need of setting up production unit the following parameters need to be taken into
consideration such as supply chain accessibility in the location of setup, feasibility to procure
raw material, cost effectiveness of setting up a plant or a new machinery.
The Annual Budget need to be created with the plan to enter into the new location with
machinery and establishment in the Rolling Budget.
The weekly tracking of sales target versus actual sales could help in understanding the
product demand and the estimation of future product sale.

2. S1O2: Explore mechanized tool for collection of neem fruit for increased production-
As stated in the previous action plan the strategy is to have Market penetration to go capture
the market share. The strength of having centralized operation with the opportunity to
efficiently utilize abundant raw material can be easily materialized using an introduction of
a mechanized tool. More the raw material is procured more can be the production of neem
oil.
A new project needs to be planned with timelines. The tool will help the labors to gather
more amount of raw material with ease and less manual effort. The monthly production report
will reflect increase the amount of neem oil production after the introduction of the tool and
how successfully it was in achieving the target to procure more amount of neem fruit.

61 | P a g e
3. S1O4: Launch Campaign to attract more labor to increase collection of neem fruit-
Since there is a centralized operation in the area of manufacturing and procurement, the
testimonies of different labors and farmers who are part of the neem fruit procurement can
be used to attract other labors. Launching a campaign would require planning on reaching
out to the potential audience who can be a part of the supply chain network and educate them
about the incentives and benefits. More the number of labors a greater number of hands to
procure larger amount of neem fruit. In this way the fruit wouldn’t be wasted and the labors
would be able to earn during their off-season time without migrating to other locations.
The tracking of setting up the campaign can be by the Human Resource team and the success
of the campaign can be tracked under the Inventory report. The expectation is to see the
increased amount raw material acquisition.

4. S3O4: Training Camp-Encourage Employee committee to have focused neem

collection- The product quality of the neem oil produced by the company is one of its core
strengths, whereas there are lot of workers who could be part of the supply chain increase the
production of neem oil by collecting neem fruits. An action can be devised to educate and
train these new labors about the whole supply chain and the processing of neem oil so that
they are aware about their contribution in the whole process. They would be trained to
identify the fruits which are suitable for procurement and can avoid collecting ones which
would be any way rejected in the process.
The camps can be kept short for 1-2 days wherein there would be other activities and
knowledge embarkment sessions. This will bring in all the stakeholders under one roof and
an opportunity to connect and interaction, making them feel to be part of one community.
The main responsible person would be the procurement manager who can train the labor
regarding the do and don’ts that would ultimately reflect on the Monthly quality report. This
report would indicate the amount of waste produced and the quality of the neem fruit
procured.

5. W1O3: Explore new location for expanding business for increasing production units-

62 | P a g e
 One of the weaknesses of the company is that operations and procurement of the neem fruit
takes place only that one location which is Sangli. In case of disease infection or spoilage of
the raw material there is no alternative for the company to procure or a remedial plan. The
neem project has shown us that there is a lot of scope of introducing new entrepreneurs into
the network. The same opportunity can be utilized to spread the procurement of neem fruit
across various other locations.
By understanding the geography and feasibility of the location whole new supply chain can
be setup there. This will not only help in having a remediation plan for the company but also
help in establishing itself in new location providing employment opportunity at this place as
well.
The annual budget can have the details of the budget allocation for establishment of the
production unit and supply chain at new location. A new project plan can be created for each
section such as logistic, Establishment of production unit etc. with timelines. This project
Progress plan can be tracked on a monthly basis to understand the progress. Once the
production plant is established the tracking can be done on the basis of the Business
performances.

6. S4T1: Invest R&D for disease resistant plants- Disease for any living being can be
dangerous. In this case the neem trees can be attacked by various fungal diseases that can
spread and infect other neighboring neem trees. In such cases it is very unfavorable to
procure such disease infected fruit and use for neem oil production. To curb the threat of the
disease it is possible to invest on R& D to come up with a disease resistant plant. Since the
company already has its core strength in performing and implementing R& D activities, the
same can be done with a target to create a disease resistant plant.
The investment can be tracked under the Rolling Budget and return on product development
expense can be used for MIS Reporting.

7. W5O1: Diversification in other low-cost product segment- The company focus on the
Product development strategy wherein there can be a division made on the basis of the
product quality. The diversification can be made during the product placement and

63 | P a g e
 promotion. This could bring encourage customer to take informed decision. On the product
development front the low-quality fruits can be used to extract neem oil and the pricing can
be lower than the other product. This will ensure that the wastage is reduced and there is full
utilization of the raw materials.
A plan needs to be deduced to understand the market demand for this low-quality neem oil
and accordingly sales projection can be made and distributed. The tracking can be done using
the Monthly Sales Report.

8. W5O4: Utilize labor when there is off season for neem for another plantation- As there
is abundant availability of labor for procurement of neem fruit and limited product
assortment, an action plan can be made to utilize the labors during the other period in
collection of other seeds that can be further used by the company for oil extraction when the
machines are ideal. The labors would be still associated with the company and help in
procurement.
Since clients also prefer to be associated with vendors who can provide different products
under one roof. This move would help in extending the product line and increase in
productivity of the company.

9. S4O5: Launch upgraded Product-Utilize Upcoming R&D technics to expand into global
market- The R&D Department can further focus on implementing new methods and
processes to increase the product quality in a cost-effective way that increase the amount of
Azadirachtan quantity in the neem oil extracted with minimum wastage.
This would not only help in capturing more clients with such high-quality neem oil demand
but also enable the company to export its product to other countries and mark it as premium
product. The initial tracking would be done by the R&D department till the product is
developed, post that the product can be tracked under MIS reporting for return on product
development expense.

10. S3O1: Position the product as organic, superior quality, nontoxic- The main

64 | P a g e
 differentiator or the USP (Unique selling proposition) for Golden Agro is its assured high-
quality product. The Marketing team should also position itself in the similar way so that the
customer perceives it in the same way. This is very important as even from the analysis
obtained from the overall industry the understanding was that the product quality is of utmost
importance. The industry is filled with manufacturers who adulterate the products with
various other substitute product.
It would be the role of the marketing manager to implement it and the sales managers would
promote and advertise the same to its customers. The tracking would have done using MIS
Reporting using Monthly Sales Report.

11. S5T3: SOP design and train employees for producing superior quality product- The
statement of Operation Procedure is a must document for an industry like neem oil extraction,
since there are many constraints involved in producing the final neem oil. To avoid missing
out on the steps and prerequisites, designing of a SOP is a must. This would not only ensure
that the steps are followed as per the standard guidelines but also improve the quality of the
end product. This can also be highlighted in the company’s profile so as to be transparent
with the customers regarding internal working processing of the neem oil extraction. The
Monthly Quality report can act as the reporting tool to track its progress and outcome.

12. W4O2: Increase production capacity -Capital investment- As there is abundance of raw
material in the current region of operation and a smaller number of machinery available at
the location of production. The action can be formulated to increase the production unit so
that the customer demands are met. The analysis can be done on current machinery capacity
against the actual raw materials to be processed. With the help of this information the next
action step to increase number of machineries can be taken.
The procurement of this machinery can be included in the Annual Budget plan and included
in the Rolling budget. Post the establishment of the machinery unit the Monthly Business
Performance Report will indicate the success of the Strategy implemented.

65 | P a g e
 Summary
In the above Balance scorecard, there were broadly there are different types of strategy used. As
the focus is to increase the overall revenue of the company, the external opportunity of growing
Neem oil needs to be exploited to the fullest. Hence the following strategies were included in the
final scorecard-
1. Market penetration –This can be defined as the extent to which the particular product is brought
by the customer. As stated above the product is already in demand in the market, however the
company need to tap the market to attract the audience into buying it. This can be done using
Market penetration technique. The company needs to include the above-mentioned Action Plan
to help gain maximum revenue by the stipulated timeline.
2. Product development- The product offered by the company has limited assortment and available
across limited spaces. The product development strategies would help the company introduce
variation and changes in the existing products that would be in more satisfying for the potential
customers. More the product caters to their needs more would be the customer satisfaction, which
would lead to retention of clients for a long term.
3. Differentiation- This strategy enables the company to produce and develop something unique
which the customer distinguishes from the competitors. As there are many competitors in the
market and to stand out from them it’s important to implement the differentiator strategies. The
strategies could increase the profitability margin and provide a perceived value to the customers.

66 | P a g e
CONCLUSION

The balance scorecard is the final outcome which could be used by the company personnel to
monitor and track the progress of all the refined strategies enlisted in the research. Any further
findings and next set to action plan would be stated in this section.
The report was written with an objective to increase the production yield of the Golden Agro.
Golden Agro Industries being an established player for about 10 years and has rich experience in
production of pure neem oil. However, in the current times the company would identify its
potential for increasing its yield and in turn getting increased revenue.
The report provides a qualitative analysis using various tools and techniques to conclude upon a
few strategies that would directly help Golden Agro Industries achieve its target. The following
were the conclusion after the in-depth analysis of the industry and the company-
1. Focus on procurement- The first step to increase productivity yield is by collecting more
‘Raw’ material. The collection of raw materials when analysis in depth turned out to be a
tedious process for the labors and farmers. The labors need to be continuously bent to
collect ample amount of neem fruit so that they would receive sufficient amount of
incentive against the raw material collected. The incentive received per kilogram of neem
fruit is also very minimal. In such cases there is a possibility that the labors might switch
to some other occupational or menial jobs during the off season.
One of the methods indicated in the academic papers was to used plastic sheet to collect
neem fruit. That might be feasible by some group of people but there might me cases when
the sheet could fly away or there may not be enough sheets available to collect sufficient
number of neem fruit.
The other method could be to devise a mechanized tool to easily collect neem fruit. The
features of the device would be as such that is easy to use. The labors need not require
much effort of learning to use the tool nor they need to put a lot of hard work to run the
tool.
The primary purpose of the tool should be to collect maximum number of neem fruit
possible without affecting the core properties of the neem fruit required in the neem oil
extract and minimum manual effort. Such a unique tool would not only help increase
productivity for Golden Agro Industry but encourage more labors to be a part of the supply
chain.

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 The plan is to introduce this tool to the NGOs who can then distribute and train the labors
to use the tool. Tool can be provided to them on a rental basis for a minimal amount. This
would be a win-win situation for both the company in terms of increased productivity and
labor in terms of the increased wages earned.
2. Human resource development – The Neem oil extraction industry doesn’t only affect the
Economy of the country but also the social status of the laborer association in the process.
Monetary benefit is only one part of the incentive that a labor would want to have. There
are other benefits which are equally important for the wellbeing of the laborers such as
medical benefits, vaccination, health checkup etc. The company can focus on conducting
regular camps for the laborer associated with the supply chain and accessibility to other
basic amenities. This will not only encourage other labors to join the network but also
instill loyalty and trust for the company, indicating a larger number of retention rate of the
labor. This would then incidentally increase the number of labors associated in the process.
There could be setup of training camps as suggested in one of the strategies that would
instill knowledge in them and let them be aware and inclusive about the whole process.
The training will improve the production process and help laborers take precautionary
measures in case they detect any disease or other calamities to prevent loss of raw material.
The training camps can also be a source of community bonding where everyone feels to
be part of one network and help reach other fulfill their expectations.
Another suggestion could be having a registration process in the NGO for the laborer so
that they can be tracked and amenities can be provided to them in case it’s required. The
bottom line being to convert an unorganized set of laborers into an organized group which
would be beneficial for both the parties.
3. Business Expansion – The Business expansion as mentioned in one of the strategies is
important as per the growing demand in the industry. The Golden Agro Industry being an
established company is aware about the do and don’ts in the industry and take an informed
decision to introduce new product lines or increase production capacity. The sales report
of the industry at various location could be helpful in making such decision. Further plan
can be chalked out to understand the next area to expand.
Also, the company mainly functions as a B2B manufacturer. The company can take steps

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 to introduce few of the products directly to the end users like the farmers. The product
development team alongside the R& D team can help deduce a plan to implement such a
strategy.
4. Product development- The product development and the marketing team can play a crucial
role in designing products which can cater to different segment of customers. A low grade
quality product can also be introduced that can be promoted to cater to the requirements
of the customers who require a lower quality neem oil.
Such categorization can help customers take informed decision and help in increasing
customer satisfaction. As per the comparative analysis with the other companies its seen
that companies with ISO certification has more client base and trust in comparison to the
one who don’t have it. Hence its recommended that the company formulate an action plan
to get ISO certification in order to increase the client base.

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