Evaluate the logic of Silvio Napoli's strategy for selling standardized elevators in India. X
What should Silvio do about the order for non-standard elevators?
To understand Silvio Napoli's strategy for selling standardized elevators in India, let us first take a look at the Indian markets using the CAGE framework:
Sensitivity of Indian employees to organizational power and relationships -
Different management styles of Indian managers ¡V "friendly and easygoing" -
Huge curve to adjust to Indian living conditions ¡V housing, school, doctors, grocery shopping, etc. -
Mostly untrustworthy middle-men offering all kinds of services -
Difficult to find office space
Inability of the market to deliver on timing ("can't set your watch by Indian trains") -
Traditional sales structure has different people to handle sales, technical and installation -
Market need for small degree of customization in elevators ¡V custom glass pod elevator, glass wall, etc.
Large income disparities between urban (metros) and rural regions -
Expanding tourism; growing demand for top-quality, high-rise office facilities -
Elevator market: price-sensitive/value-based, need for excellent after-sales service, brand-sensitive; not as much focus on reliability -
Significant long-term differences between European and Indian markets in costs, willingness-to-pay, etc. Administrative
Excessive paperwork for government regulations and legal proceedings -
Huge tariffs/duties on imports of non-core goods such as elevators -
Mostly joint-ventures and domestic companies in the elevator market
The case indicates that the Indian elevator market was divided into three segments: ¡V
70% Low end: intense competition/local companies
20% Middle end: demanding modern, safe, quality product
10% Top end: 24/7 service top line elevators
Silvio was aware that due to the high import tariffs, their manufacturing costs...
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