Product Strategy for Business Success

Assignment 2 – IPCSL Case Study

Participant Name: SHAHEER T
Question 1: State the economic value IPCSL created for farmers and commission
agents. (~200 words)
• Economic value to Farmers
• There is a significant value addition to farmers by IPCSL
– Difference b/w offseason and season price is the price added to farmers for each item , For Example

Kiwi Assume: 1 month: Meaning entire fruit can be sold if it is

• 1 shipping container of Kiwi • Ordinary cold storage rate for storing of stored in ipcl , no wastage
• Price of the Kiwi = 2100 per kg
= 20 tons fruits = 50 paisa/kg Wastage cost of the Kiwi per kgI
• Wastage = 33 per kg
• Life of Kiwi in ordinary cold • IPCSL's cold storage rate for 1 month for PCSL's cold storage cost for 2
• Kiwi can be stored for 2 months
storage = 10 days storing of fruits =3 INR /kg months/kg
in IPCSL's cold: And be sold in 2
• 2/3 of the container can be 2 months: =33-6 = 27 /Kg = value addition
months
soldin 10 days • IPCSL's cold storage rate for 2 months for
• 1/3 of Kiwi would perish storing of fruits =6INR /kg
• Competitor's rate = 1INR /kg
• 5 INR more if it is stored in IPCL but if it is
stored in ipcl KIWI can be stored in 2 long
month
Question 1: State the economic value IPCSL created for farmers and commission
agents. (~200 words)
• Economic value to commission agents
– It is not adding economic value to commission agents
– Sell seasonal fruit- get a 6% commission
– Cost of the in-season apples = INR 550 per box
– The commission amount received by the agents in-season =Percentage of the commission × Cost of the fruit
per box= 6% × 2550 = INR 33
• Cost of the off-season apples = 7680 per box
– The commission amount received by the agents off season =Percentage of the commission received × Cost of
the fruit per box= 6% × INR 680 = INR 41
– INR 8 extra commission received off-season is 25% of the total commission received in-season, INR 33
– By looking at this perspective, Sanjay's cold storage is adding value to the commission agents
– The commission agents will lose their opportunity cost if they sell a stored fruit in the off-season at the cost of
the seasonal fruit
– For every box they sell of the stored fruit at that time, they could sell the fresh fruits, earning 733 directly,
assuming that the seasonal fruit costs the same as the apple in season• Loss in opportunity cost = The
commission amount received by the agents on-season - The extra amount in commission received by the
agents off-season= inr 33 –inr 8= inr 24
Question 2: Evaluate Porter’s value chain for the farmers in the IPCSL case.
(~500 words)

Primary Inbound These activities of Ipcsl Cold are associated with receiving, storing and disseminating the inputs of the products.
activities logistics It can include material handling, warehousing of physical products, as well as architecture to receive and store
customer information for digital media company. Ipcsl Cold at present has outsourced most of its inbound
logistics activities.
operations Activities that help the organization to transform raw material into finished products. For the purpose of this
article the definition is broad – it can mean moulding plastic to make products, using customer data to serve
advertisements based on usage behavior to clients etc
Outbound Ipcsl Cold under takes these activities to distribute the finished products to channel partners and final buyers.
logistic Outbound logistics activities include – wholesalers and retailers order fulfillment, distribution network,
warehousing, scheduling, and processing.
Marketing and These activities are undertaken by Ipcsl Cold to create means through which the buyer can buy a firm’s
sales products. These activities include – marketing, channel selection, pricing, advertising and promotion, sales force
management etc.
Services Ipcsl Cold needs to provide after sales services and maintenance for successful usage of the product. Service
activities of Ipcsl Cold can include – training, installation services, post sales maintenance, part supply, and
product forward and backend alignment of software
Question 2: Evaluate Porter’s value chain for the farmers in the IPCSL case.
(~500 words)

Support procurement Procurement activities at Ipcsl Cold include activities that are undertaken to purchase inputs that are used by
activities Ipcsl Cold’s value chain. It doesn’t include purchase inputs themselves. Purchased inputs may include - raw
materials, supplies, machinery, laboratory equipment, office equipment, and buildings.
Like all other value chain activities procurement also employs technology for things such as – procedures,
vendor management, information system, and supply chain partner qualification rules and ongoing performance
evaluation.

Human In an environment where each organization is striving to become a learning organization, Human Resources
resource Management is key to the success of any organization. HRM support activities include – Recruiting, Selection,
management Skill Assessment, People Planning, Training & Development, Hiring and Compensation at both business unit
level and corporate level.
Human resource management affects competitive advantage in any firm, but in some industries it is defining
factor. For example in the consulting companies HR is the main source of competitive advantage

Infrastructure Firm infrastructure support activities at Ipcsl Cold consists activities such as – general management, legal
services, planning, finance and accounting and quality management.
Firm infrastructure activities at Ipcsl Cold supports entire value chain though the scope varies given that Ipcsl
Cold is a diversified company even within the industry. For example the finance and planning at Ipcsl Cold are
managed at corporate level while quality management, accounting and legal issues are managed at business
unit level.

Technology Technology supports almost all activities in modern day organization. In the technology industry, technology
development development has become a source of competitive advantage. Technology development at Ipcsl Cold may
include activities such as - field-testing, process engineering, feature design, component design, and technology
selection.
Question 3: List the possible ways that IPCSL could communicate and deliver
value to its customers. (~200 words)
• The organization had only 3 manager
• Manager 1: overseeing the technical operations
• Manager 2: finance
• Manager 3: human resource and administration direct employees held clerical, supervisory, and business function responsibilities and were involved in
transportation and security aspects. Indirect were contract laborers deployed by labor supply contractors who worked on the floor and were mainly]
involved in loading and unloading fruits.The organization doesn't have a marketing team or an employee who could market its product after the
modernization and expansion drive. All farmers are not literate enough to understand their modernization. Even their sales transactions are conducted by
artis by closed and open auctions. There is no possibility that they understand the value of such an advanced setup.
• So IPCSL should create a new post to marketing where a marketing professional ca explain the setup of IPOSL, its advantages and the reason the cost is
high. It wil al more effective if the marketing professional could explain the above to them in the local language or with the help of interactive videos to
make them visualize and understand it better