Pramal Farmatics Pvt Ltd have acquired the technology and exclusive rights to manufacture and market 10 HP Mini Tractor ‘Vanraj’ in 4 Indian States – Gujarat (GJ), Madhya Pradesh (MP), Maharashtra (MH) and Uttar Pradesh (UP). It has many features - affordable, fuel efficient, low maintenance cost, less operational costs, comparable features with big tractors. However, Pramal partners are in dilemma in targeting market segments.
Background: The 4 states in which
PROBLEM IDENTIFICATION & ANALYSIS
Below are the case analysis and the problems identified
Immediate concern to select most appropriate market segment. 2.
Being a small-scale-industry, Pramal needs to be extremely productive in marketing efforts. This involves direct selling to the final consumers – farmers. 3.
Pramal identified 4 market segments – Small and Marginal farmers, Large farmers, Industries and Horticulture farmers. 4.
Small and Marginal farmers
Large in numbers
No big player (tractor manufacturer) served in this segment (< 20HP). HMT is planning to enter this market with 18-20HP Tractors priced at around 0.18 to 0.2 million rupees. •
Dependent on their bullocks for farming activities
Farm mechanization extremely low
82% of Total Land holding (with no tractors)
Per Annex-2, 77% of the total Operational Holdings in the above mentioned 4 states
Small in numbers
Lucrative market segment
Big Players (tractor manufacturer) serves in this market •
High Farm mechanization
Per Annex-2, 23% Operational Holdings in the above mentioned 4 states 6.
Horticulturists had large land holdings.
Average land holdings for farmers on decline
Northern Indian states have alluvial soil type so less HP tractor is sufficient. 9.
States under consideration have harder soil types which require higher HP tractors. 10.
Below figure shows market share of different tractors available in Indian market.
Less than 20 HP tractors was...
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