Farm Electronics Case

B2B Marketing Dilemma

Submitted by- Group 1

IEP/21002 Florian Toutain

PGP/36/171 Ishika Sharma
PGP/36/122 Kajal Yadav
PGP/36/023 Kanika Gulati
PGP/36/271 Mayank Kashyap
PGP/36/081 Parthivada Karthik
PGP/36/434 Pragya Chansoriya
PGP/36/146 Swagata Ganguly
PGP/36/047 Varun R.T.
Agenda

• Problem Statement
• Context Building & Current Scenario
• Evaluating the Available Alternatives
• Recommendations
• Analysis for Reckitt Benckiser’ Lysol
 Problem Statement

Problem Statement

Identifying growth opportunities & determining whether to maintain the company’s status quo or to diversify
its customer base.

Some other points to be considered basis the above decision are-

• Product Development

• Capacity Enhancement

• Prospecting
 Case Facts

Farm Electronics- Company Background

• Incorporated in 1977 by Dinesh Ratanlal, Farm Electronics is a sole proprietorship firm that manufactures
electrical and electronic industrial equipment and operates in the small-scale industry.

• Initially targeting farmers, the company now manufactures Transformers, Power Supplies, & multiple other
electrical & electronic component parts.

• Positioned as a sub-vendor to identify firms with ongoing need for specific electrical components- for own
manufacturing process or intermediate goods for larger equipment. The idea was to generate repeat sales by
leveraging customer relations.

• Core Products- Isolation Transformers, Railway-Signalling Relay Coils, BLDC Motors, Power Supply, DC Motors

• Value Propositions- Quality, On-time delivery, After-sales services, Customized Product Ranges, Lenient Credit
Policy, Attractive repair & replacement offers.

• The company invested in a manufacturing unit with premium machines to meet the growing demand & built a
separate in-house design facility and quality inspection unit.

• Pricing of the company’s products was mostly dependent on the raw material costs- governed by International
Markets.
 Case Facts

Buyer Persona- 1/2

Type A Type B Type C Type D PSUs

Industry Large-Scale Medium-Scale Small-Scale

Unorganized Large-Scale
Industry Industry Industry

• Very tedious
• Formal Process • Completely
process
• Prototype • Formal process unorganized
involving
submission initiated with • Purchase process
floating of
• Quality RFPs manager • Owners
tenders.
Assessment- • Meetings held contacts contacts
• Sometimes the
high with vendors to locally known multiple
Buying Process specifications communicate vendors vendors
departments
also buy
• Price quotes, specifications selecting the
directly from
scheduling & one offering
existing list of
deadlines. lowest prices
vendors
 Case Facts

Buyer Persona- 2/2

Type A Type B Type C Type D PSUs

• Standard • Standard
• Customer • Regular business
product product
retention was • Standard • Chance to
requirement requirement,
Opportunities good product upgrade to a
• Relation with hence easy to
• Business was requirement vendor from
purchase meet the
regular sub-vendor
manager very customer
useful expectations
• Winning a new • Account • Very tedious
account is amounts were • Transaction buying process
difficult low amounts are • Tradeoff
• Lengthy • Issues with the • Huge very low & between
process- high terms of credit competition- customer returns and
Challenges response & offered. mainly loyalty also competition
conversion established not depending on
time vendors in this guaranteed. the scale of
space contract
 Analysis

Alternatives Available- Ansoff Matrix

se ?
h o o 2
to c

New
o ne Market Development
i ch Expanding the customer Diversification
Wh base - new clients under
different segments
Markets

We have first compared

1 3 Options 1 and 2; and then
delved deeper into various
Existing

Market Penetration Product Development other alternatives given in

Maintaining the Status Extending the product the case
Quo- Sub vendor with two portfolio- upsell/cross-sell
main customers to existing clientele

Existing New
p hy
4 gra Services
eo
G
 Analysis
Analysis- 1/2
Option 1- Maintaining the
Status Quo
• Less effort in bidding
and tender process- easy
Pros repeat and regular sales
• Less investments
• 87% dependency on just
two accounts- very high
Cons risk
• Stagnant growth- low
scope for upsell
• Low profit margins- sub
vendor
Aligning with the Growth objective of the company, we suggest Increasing the Customer Base
Option 2- Increasing
Customer Base
• Access to new markets-
more market share
• More growth opportunities-
chance to become a vendor
• More revenue
• Higher investment
requirement
• Limited resources
• Establishing new client
relationships

Analysis- 2/2
Targeting Type A & B
Need to start cust. Manuf.
Facility; frequent
upgrading; employee
Investment
hiring; quality control labs
Requirement
Company has outstanding
experience in this
Resource category.
Availability & Increased need for
Internal Capability customization
Direct reaching out via
trade shows, cold calling,
etc- establishing trust
Marketing Strategy (quality prototypes) is key.
Once relationship
established, retention is
Level of easier- hence, low to
Competition moderate competition
Very formal and lengthy
buying process- many
Buying Process influencers & gatekeepers
Analysis
Targeting Type C & D
High marketing expenses-
approx. 15% of revenue for 1st
three years
Existing relations of utmost
importance & easy credit
terms are demanded-
company offers lenient credit
policy
Heavy marketing activities to
tap these segments-
established connections are
more significant
High competition with
several vendors available as
alternatives
Unorganized process- with
cases of straight rebuy mostly
from existing vendors
Targeting PSUs Overseas Expansion
Process design; investing
in maf. Equipment; Substantial investments
workforce recruitment; in infrastructure
quality certifications
Company already sub- Companies providing
vendors to vendors of better after-sale services
Indian Railway, hence high and competitive pricing
chances of becoming in more demand- in line
direct vendors with FE’s USPs
Participation in tenders &
expanding online presence Attractive credit policies
for transparent bidding & competitive pricing
process
All the vendors
Low to moderate- mainly
participating the tender
Chinese firms are strong
become competitors-
competitors
moderate to high
Tedious process with red
-
tape

Recommendations
Recommendations Explanation
• Given the standard product
requirement and inclination
for lower prices, online
portals can become as easy
source of reaching to this
Leveraging online portals segment
Creating profiles on sites
to tap type C & D •
customers like- IndiaMART etc also
help in brand building- more
awareness, more sales
• Better sources of continuous
sales
• Once relation is established,
it is easier to retain this
Channelize revenue from segment.
new sources to • The transaction amount
involved is also- high
developing infra for
revenue potential
tapping Type A customers • The new facilities can also
be used for other customer
groups.
Recommendations
Feasibility Priority
Yes
• Already the company has an
online presence 1
• Company is in a good • To be implemented in the
position to extend lenient short run
credit terms & discounts-
positive working capital of
110166.9 (projected)
Yes
• The company already has
outstanding experience in
this segment • 2
To be implemented in the
• The company has
medium to long run
capabilities to offer high
levels of customization
• Positive incremental
revenue
 Recommendations

Cost-Benefit Analysis
Estimating the Cost & Revenue of
targeting an additional Type A Incremental Cost/Per Customer    
customer
Cost in Prospecting Type A customers 1000 
Cost of Custom Manf. Facility 50000 
Additional Operator's Cost 4000 
Quality Control Lab 20000 
Depreciation of QCl 4000 
Capacity Enhancement Cost 75000 
  154000

Incremental Revenue/Per Customer  

Incremental Manf. 191520 
Revenue/Unit 3.359577778 
Incremental Revenue (Type A) 159647.136 

Incremental Revenue (Type B,C, & D) 20754.12768 

  180401.3
Revenue less Cost   26401.26 Profitable
 Analysis for RB (Lysol)

Lysol
B2B Marketing Dilemma
 Analysis for RB (Lysol)

Lysol- Portfolio

Lysol

Disinfectant Cleaners Hand Soap

• Lysol Disinfectant Spray
• Lysol Disinfecting Wipes • Lysol Power & Free • Lysol No Touch Hand
• Lysol Concentrate • Lysol All-Purpose Cleaner Soap System
Disinfectant • Lysol Multi-Surface Cleaner • Lysol Touch of Foam
Pourable Hand Wash
• Lysol Power Kitchen Cleaner
• Lysol Bathroom Cleaner
• Lysol Toilet Bowl Cleaner
• Lysol Mold & Mildew Remover
 Analysis for RB (Lysol)

Buyer Persona
Supermarkets/ Educational
Transport industry like
Retail chains Institutions like Hospitals/ Medical clinics
Railway Stations/Airports
like Big Bazaar schools/hostels
• Formal process with established procurement • Supplies department • Formal Process for govt hospitals
• Cleaning Department initiate
policies initiate the process • Estimating and calculating
the process
Buying Process • Competitive bidding process • May or may not call
• May or may not call for RFPs
requirements
• Tenders documents uploaded online for RFPs • Supplier selection
• Bulk purchase from the
• Vendor approval and assessment • Bulk purchase from • Placing the order using order form or
manufacturers in case of
• Levy of liquidated damages for delay in the manufacturers requisition form
stand-alone or small schools
supply • Receiving the supplies

• Increased awareness and need

• Indian railways purchase their goods & • Easy customer
of sanitization in the • Increased need of disinfectant and
supplies majorly from large private industry retention process
Opportunities (60%)
educational institutes cleaning products
• low involvement purchase

• Winning a new account is difficult

• Strict procurement policies
• Established relationship towards only
• Levy of liquidated damages for delay in • Long-term established • High brand switching cost,
health & wellness companies
supply relationship with other retention required for long-
• Poor penetration into the rural markets
Challenges • Joint inspection in case of rejections &
recoveries.
brands term customer base
for govt hospitals

Recommendations
Retaining the existing niche customer base is
important as the firm understands them
thoroughly, hence can become an undisputable
leader. It helps in making their marketing
efforts easier by defining exactly what they
do & distinguishing them from the
competition
Improve online presence and visibility by
collaborating with relevant influencers.
Robust educational content and carefully
targeted offers can drive leads to closer and
closer engagements, eventually bringing
qualified leads straight to them.
Analysis for RB (Lysol)
Increasing the customer base: By using
content marketing, RB can build a brand with
a widespread reputation for specialty in their
area even among audiences that haven’t
worked with them directly (Referral
marketing). This brand recognition can lead
to referrals and new business.
Co-market or cross-market with
complementing brands: By co-marketing
initiatives in conjunction with a like-minded
brand, they can help drive more attention,
leads, traffic, and sales for both companies.
For example, advertising through rural
newspapers to increase rural penetration
THANK YOU!