Indradhanush Paints

Ltd.
Group Members:
Varun Hegde
Mayuri Mahalungekar
Anand Raorane
Rahul Pote
Rohit Bhalekar
Overview
About Company
Formed in 1940
1960 developed its distribution network
4 Manufacturing units with 47 Sales offices across the
country
Rural Market neglected by MNCs
IPL has wide distribution network; they have many
retailers and distributers
Small packages giving competitive advantage to the
company
Product Range
Enamel Paints
Liquid Paints
Distempers
Aluminium Paints
Wood Finishes & Varnishes
Patti & Fillers
Rural Paint Market
Highly Price Sensitive
Sales were during different festivels
Distempers & Paints were used to paint
Horns of Bulls
Horns of Bullocks
Horns of Cows
Bullock Carts
Chuna was used as White Wash
This process of white washing was done every year
This process was Tedious
Chuna was Hazardous to health
Was available only in one colour except for few shade
It used to Flake off
The products paints and distempers used by the
villages for specific purposes
IPL’s strategy was to go rural
Their product Harvester failed in the market
Faced competition from the unorganised sector
Unorganised sector price the products very low and
they have also penetrated the market
Stiffer competition expected by the unorganised
sector in future
SURVEY
Survey was done in 1989 and 1993
Conducted in 15 villages across the country
Covered almost 200 household
Proportion and the pricing were the major factors
1989 Survey
Proportion was
Chuna 63%
Cheaper paints and distempers 2%
IPL Harvester paints and distempers 35%

Pricing to paint per 100 square feet area

Chuna Rs 22
Cheaper paints and distempers Rs 55
IPL Harvester paints and distempers Rs 70
Salient Observations of 1989
Chuna application was tedious
Those who used Harvester distemper accepted it was
superior to chuna
Unorganized players used low price as their USP
Price of Harvester was prohibitive for large number of
people
1000 manufacture in unorganized sector and 400 were
coming up
Painting & distempers were associated with festivals &
purely seasonal
1993 Survey
Proportion was
Chuna 45%
Cheaper paints and distempers 15%
IPL Harvester paints and distempers 40%

Pricing to paint per 100 square feet area

Chuna Rs 25
Cheaper paints and distempers Rs 62
IPL Harvester paints and distempers Rs 80
Salient Observations of 1993
Harvester was expensive & investment of people in it
was less irrespective of quality
Availability of shades did not suit rural requirement
Rural consumers were switching to cheaper brands
Affordable and inexpensive paints & distempers were
preferred
Cheaper paint and distemper manufacturers resorted to
direct selling to rural retailers
Buyer behaviour
The rural market is very price sensitive
The price and the availability of the product matter
more than the brand of the product
Price sensitivity has adverse effect on quality
Unorganised sector benefitting from this
For products such as ‘paint’ village buyer(including
the retail buyer) won’t travel far
Benefit sought
The paints are used to paint animal horns, doors of
houses etc.
Distempers are used only for white washing the walls
Competition
Organised sector 40%
IPL 31%
Goodlass Nerolac 15%
Berger paints 11%
Other organised players 43%
Unorganised sector 60%
Unorganised sector price the products very low
They sell directly to retailers so their costs are less
SWOT Analysis
Strengths
1.


Wide distribution network

Small size packs giving them competitive advantage

Largest market share in rural market instead of big players

Cash and carry system followed towards the retailers to avoid bad debts

2. Weakness
Harvester proved that company failed to study Market need
Underutilization of distribution
Same margins given to all the retailers and also indirect selling to retailers
eats up the margin
Price was higher than the products sold by the unorganised sector
The brand name was not helping in the sales of the products
3. Opportunities
 The use of chuna is tedious and also has ill effects on
health
 Direct selling to retailers will cut down on the margins

4. Threats
 Current Competition from the unorganised sector in
terms of distribution and price
 1000 more unorganised players are supposed to enter
the market
Marketing Mix
1. Product
 Compatibility between consumer needs and the product
 Products which are underperformers should be removed
from the market as well
 They should come up with a good mascot for the product
so that the company could play with the perception of the
customers
 Core use of the product being painting; other augmented
use of the product should also be thought of
 The product ‘paint’, applied on animals, doors of houses
etc. can be made less toxic
2. Price
The prices are higher than the prices of unorganised
sector products
The margins given can be reduced by selling to the
direct retailers
Same margins should not be given to all the current
retailers
3. Place
The distribution network of the company is very wide
but not close enough to the village buyer
Direct selling to retailers
4. Promotion
The product should reach the shelf of village shops
etc.
The product should have a mascot
The other benefits from the product should be
highlighted
Retailers should be involved in the promotion process
Melas and local festivals can be used to promote the
products