JSW Steel is an integrated steel manufacturer. It is the largest private sector steel manufacturer in terms of installed capacity. In an effort to expand it’s retail base and to give better service to end customers, JSW Steel has set up 380 exclusive JSW Shoppes across the length and breadth of the country (JSW 2013). Vice-Chairman cum MD of the group has entrusted the task of enhancing brand, penetrating deep into the market and increasing dealers loyalty towards JSW to a team. Thus, took birth the concept of JSW Shoppe which was a name give to the organised retail format of JSW. They wanted it as a medium for end users to experience, understand and appreciate the quality of JSW steel and also to build a robust distribution network capable of bolstering JSW as a premium brand, resulting in its products becoming customer’s preferred choice. Thus by taking a decision to create a organised retail format, JSW apart from creating a more efficient supply chain also thought on rebranding its image in the minds of end users. Question 1: Differentiate between the previous and new business models. What are the advantages of new model? Steel industry in India had always favoured bulk buyers (Dealers, Construction companies) who placed orders directly with steel mills. Smaller buyers (fabrication units, home users, end users) are dependent on dealers to procure steel supplies. It was more of a Business to Business (B2B) product as opposed to Business to Customers (B2C).
In the older model, dealers were free to keep products from several manufacturers in their stores and sell them. Also, no surety of supply of steel was ascertained from the companies. They had no choice but to exist in a difficult and fluctuating market situation. JSW Shoppe was the new and organised retail format which will display all the products of JSW Steel. The objective is to attract end users to the stores and to help them understand the applications of the products. The outlets...
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