Market Entry Strategy for Value Added Products Retailing for a Leading Steel Manufacturer
About the client
A prominent Indian steel manufacturer wanted to extend its business upwards in the value chain and move into retail of value added steel based products. It wanted to explore the potential in possible segments, identify the most ideal one to target, and develop a competitive market entry strategy.
Core objective was to propose a business strategy for entering into steel based products retail segment, answering the following key strategic questions:
- What are the various product categories which they can enter into leveraging existing strengths and considering market potential?
- Who are the major competitors (Indian as well as International) in these segments and what is their business model?
- Who are the core consumers?
- What should be the implementation roadmap for the next 5 years?
- A long list of steel based product categories was created which was further shortlisted into 3 major product categories by applying various filters, so that the strength of the client can be leveraged to its maximum. Shortlisted categories were Furniture, Modular Kitchen, and wardrobes which were then studied in detail.
- Current Market Scenario:
- Market Analysis: current market size, price segmentation, and growth trends of Indian F&F retail and their sub segments- steel furniture, modular kitchens, and wardrobes.
- Competitor Analysis: major competitor profiles in terms of their core consumer, product offerings, retail presence, location strategy, price positioning, etc. including International players for benchmarking.
- Consumer Research: consumer survey across 12 cities was conducted to understand consumer needs and expectations from such products, critical selection parameters, price sweet spots for such products, etc.
- Formulated Business Strategy:
- Appropriate positioning
- Product-Price mix
- Distribution strategy
- Roll out plan – no. of outlets, cities for expansion
- Developed a 5 year business and financial plan as per the suggested strategy highlighting revenues, operating expenses, investment requirements and working capital requirements.