Diversification Strategy - Wazir Advisors

Strategy > Consumer Products and Retail > Diversification Strategy

Assess & Identify the High Opportunity Segment in Indian Retail Industry

About the Client

The client, one of India’s largest players in the infrastructure sector, wanted to understand the Indian retail industry and identify high opportunity business segment within so as to achieve a turnover of Rs.2,000-3,000 crore in next 4-5 years.

Project Objectives:

The core objective of the project was to identify high opportunity segment in Indian retail industry and the position that can be taken by the client, while answering some key questions like:

What is the global and Indian retail scenario? How some of the leading brands & retailers have grown over a period of time?
What are the most opportunistic/ high growth categories/ sub-categories?
What are the various positions in a retail value chain that can be adopted by the client?
How does retail measure up to/ compare with other opportunities/ business segment on key financial parameters?

Deliverables:

1. Landscaping Global & Indian Retail Market:

1. Overview of global & Indian markets in terms of – macro-economic factors, retail market size, etc. Also provided key consumer trends that are driving the Indian retail market and will continue to be a growth fuel for the future.
2. Developed detailed case studies of key brands & retailers to better understand the market realities and how these brands/ retailers have become market leaders.
3. Detailed analysis of various categories on parameters like – market size, segmentation, key trends driving the category growth, etc.
4. Overview of typical Indian retail value chain and various entities involved in it, their key performance indicators, trade terms, etc.2

2. Shortlisting & finalization of most opportunistic segments:

Aligned client’s expectations and retail opportunities based on various attributes like- target consumer segment, market/ price segment, potential channels, operating mode, etc.
A long list of key categories & sub-categories was prepared which were evaluated to arrive at the best possible opportunities. The first level of shortlisting was done through a detailed evaluation matrix based on predefined parameters. The final filtering of the shortlisted opportunities was conducted through an evaluation matrix based on key success parameters.
Final opportunities were detailed in terms of market size, key trends supporting the growth, a brief concept, probable business model, etc. Brief case studies of key global & Indian company benchmarks were also provided.

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.

Project Objectives:

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?

Deliverables:

1. 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 could be leveraged to its maximum. Shortlisted categories were Furniture, Modular Kitchens, and wardrobes which were then studied in detail.

2. Current Market Scenario:

1. 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.
2. 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.
3. 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.

3. Formulated Business Strategy:

Appropriate positioning
Product-Price mix
Distribution strategy
Roll out plan – no. of outlets, cities for expansion

4. Developed a 5-year business and financial plan as per the suggested strategy highlighting revenues, operating expenses, investment requirements, and working capital requirements.