CASE-STUDY

GROUP MEMBERS
Anthony Gomes [13] Kaushik Ganguly [03] Chiranjib Rudra [05] Sandip Ghosh [22] Avash Chakraborty [17] Arghya Basu Adhikari [41]

Tathagata Ghosh [31]

Sanjay Ghosh [11] Nirmal Yadav [07]

Case Study
Company Profile:Synthetic Pencil Manufacturing Company.

Product:Challenges Ahead:-

Wood-pencils
Financial Crisis due to variations in monthly sales figure. Ballpoint Pen manufacturing company.

Market Competitor:-

The purpose of the case study is to analyze the causes behind the failure of the Synthetic Pencil Manufacturing Company. So we have highlighted certain major points which is responsible for the financial crisis..

1.Ballpoint pens has attractive colours and comparatively less price . 2.The marketing & sales team are ineffective regarding market trend as they are satisfied without assessment . 3.Increase in price of wood causes declining quality due to the usage of hard-wood instead of soft-wood. 4.R&D Team has developed variations in existing product, additional features along with new products in line. 5.The Corporate Management is not sure about the forecasting of sales analysis.

Case Study
From the case study we need to investigate and report on the following questions:-

Table for Analysis

From the given data references we can write:Serial No

Months (t)
1 2 3 4 5 6 7 8 9 10 11 12 78

Sales

Yt
120 125 180 100 90 80 130 110 60 130 170 150 1445

t*Yt
120 250 540 400 450 480 910 880 540 1300 1870 1800 9540

t2
1 4 9 16 25 36 49 64 81 100 121 144 650

From the above table we can say that : Y Y / n 1445 / 12 120.42 and t t / n 78 / 12 6.5
t

Graphical Representation
From the given data references we can plot the below graph:-

190 180 170 160 150 140 130 120 110 100 90 80 70 60 50 40 30 20 10 0 1 2 3 4 5 6 7 Months

Market Trend for Synthetic Pencil Company.

Months (t) Sales Yt
8 9 10

11

12

Regression Analysis
Now as we know by the Regression Analysis of time series we can express the forecast equation as,

Tt b0 bt t.

Tt Trend Value of sales in time t b0 I n t e r c e p t o f t h e t r e n d l i n e bl S l o p e o f t h e Tr e n d l i n e

Again we know for computing the values of b0 & bl we may write:bl

t.Y ( t Y ) / n & b0 Y bl t t ( t ) / n
t t 2 2

Yt Actual value of time series in period t n No. of periods Y Average value of time series t Average value of time

Actual trend
So from the table putting the values we get:-

9540 (78 1445) / 12 9540 9392 5 147.5 bl 2 650 (78) / 12 650 507 143 bl 1.03(approx.)
So for b0 we get, b0 120 .42 (1.03 6.5) 113 .73(approx.) So the trend line equation of time series analysis, we get:Tt 113 .73 1.03t

Therefore the actual trend of the market as is reflected by sales we can say is very slowly uprising (as value of bl is very small but positive).

Forecast for the next three months

Forecast for the next three months are given below :-

Tt / t 13 113.73 (1.03 13) 127.12 Tt / t 14 113.73 (1.03 14) 128.15 Tt / t 15 113.73 (1.03 15) 129.18
Monthly Sales figure in Lakh
190 180 170 160 150 140 130 120 110 100 90 80 70 60 50 40 30 20 10 0 1 2 3 4 5 6 7 8 9 10 11 12

So the forecast sales figure for the next three months are1,27,12,000 and1,28,15,000 and 1,29,18,000 respectively.

13

14

15

16

If the trend is upward

If the trend is uprising then by spending money on product improvement, promotion, and distribution the firm can capture a dominant position. It forgoes maximum current profit in the hope of making even greater profit in the next stage.

The firm uses several strategies to sustain rapid market growth as long as possible. These strategies are as follows:Improving product quality and adding new features and improved styling Adding new models and flanker products Entering new segments Increasing distributing coverage and entering new channels Shifting from product awareness to product preferences advertising Lowering prices to attract the next layer of price sensitive buyers

Indication of DECLINE in Life Cycle

If there is a possibility of reaching the decline phase. In decline stage the symptoms are like Decline sales Low cost per customer Declining profits Laggards are targeted Declining competition In this stage the company should take the below steps:Product : Phase out weak items Price : Cut price Distribution : Use selective distribution : Phase out unprofitable outlets Advertising : Reduce to level needed to retain hardcore loyalist Sales Promotion : Reduce to minimal level

SWOT ANALYSIS
Strong Brand Loyalty
Experience Active R&D Centre Wide Product variation

Quality Compromise
Inactive marketing team Puzzled Management

S
O

W
T
Cheap ball point pen mfgrs Financial crisis

Huge market Potential Diversification

Conclusion
They need to concentrate on following four things : Customer Reduce No. of customer complain Increase customer satisfaction Identify target customer and market segment and measures the companys success in these segments Focus on Internal Operation Product Innovation Reduce New Product development time Increase yield Financial Reduce cost in key areas Increase revenue generation from new products Learning Proper training for employees for their advancement Increase employee satisfaction

 A market is never saturated with a good product, but it is very quickly saturated with a bad one

Henry Ford

TANDEM GROUP