Marketing Management Case Analysis

1. Vanraj Tractors - CAN
Sr no Name Roll No Organization Designation
1 Aswin Palliath EPGP-07-21 RINA Surveyor
2 Chintan Gondalia EPGP-07-28 L&T AGM
3 Ranjit Mohan EPGP-07-69 Mondelēz India Foods Ltd Architect – CCS
4 Yogesh Gopalkrishnan EPGP-07-98 Novartis Senior Manager

2. Major Decision Issues
- Major dilemma / decision issue is for Mr Trivedi to select a market segment and target the
marketing efforts towards the same.
- There are four segments that were identified
o Small and marginal farmers,
o Large farmers,
o Industries,
o Horticulture.
Recommendation/Inferences on major issues
- Focus marketing efforts on selling tractor to
o small and marginal farmers
o large farmers ( with niche of horticulture)
Summary analysis
- 82% of the total landholding in India belongs to small and marginal farmers. These are yet to
mechanize their farming.
- The mechanization of farming was happening at a good pace but as per research the average
landholding size had reduced from 2.3 hec to 1.57 hec. This made bigger tractors less viable for
these farmers. Farmers were willing to buy tractors that would match their need.
- Horticulture has grown in Gujrat and maharastra over past decade, however it has fallen in UP
and MP. Hence focus on horticulture sale in Gujrat and Maharastra region.
- Large farmers can benefit from Vanraj, since it will perform the same work, with much cheaper
investment. Moreover the better maneuverability and the additional features for weed removal
and availability of PTO makes it more value for money for large farmers.
- Drivers of tractor demand are
o Monsoon
o Level of agricultural production
o Minimum support price
o Price of tractor
o Fuel efficiency
o Availability of spare parts
o Maintenance costs
o Compatibility of tractor with various farm implements
o Ease of loan availability
- Selling points of Vanraj over bigger tractors
o Higher the horsepower of a tractor, more the usage of Diesel: Mini-tractor consumes
about 1.5 litres/hour while the larger ones need a spent of 4litres/hour. There is a saving
of about 60% on fuel costs.
o Mini-tractors are priced affordably for the farmer compared to the big tractor – typical
25% savings.
o Tractors are mostly financed (90%) through banks and at cheap rates. However there was
gross under-utilization of the bigger tractors for smaller area of land requiring longer
break-even period and eventually leading to higher rates of default on loan repayments. A
mini-tractor thus will be more efficient in utilization and break-even can be easily
optimized.
o Mini-tractors being a single piece casting design structure is low on maintenance – its
lifetime service and repair charges are approximately 15% of selling price.

3. o Its smaller wheel base and turning radius offered better maneuverability and control and
its size made it accessible to all corners of the land .
- SWOT analysis
- Comparison with bullocks for small farmer market
- Bullocks (2) vanraj Bullocks(4)
Initial expense 27500 1,90,000 55,000
Life-years 8 8 8
Fuel cost/Fodder
cost
17500 1.5*950*40=570
00
35,000
Maintenance cost 23750
Inter culture cost Man hours for a
hectare@rs 10/hr
=400*10=4000rs
2.5*40=100rs for
hectare
-
Deep Plough 1600rs per acre 560 rs per acre 3200 rs per acre
Subsidy possible 30,000
Promotional
Schemes
NIL Pay only 50,000
upfront, rest on
installments
NIL
Rotavator NIL YES NIL
Pump attachment NIL YES NIL
Thrasher NIL YES NIL
Small Generator NIL YES NIL
- Comparison with other tractors for Large farmers (and horticulture) market
STRENGTH WEAKNESS OPPORTUNITY THREAT
Affordable, lower
operation &
maintenance cost
New entrant in
market segment
Huge potential market New product offering
planned by HMT
PTO
Higher price in
same segment
Lack of big players in
the segment
Lower quality assembled
products from Chinese
makers
Better
maneuverability
leading to better reach
in hard to reach areas
Conservative
sales figures
Government subsidy
applicable
Gujrat based brands-Field
Marshal,Thrishul,Captain
.Assembled products
Can be used in
industries
-
Single piece casting - -

4. - Vanraj 10
HP
18-20HP
(HMT)
20-30HP 30-40HP 40-50 HP 50 above
Savings by
subsidy
30,000 30,000 30,000 No subsidy No subsidy No subsidy
cost 1,90,000 1,90,000 2,50,000 3,50,000
Fuel
efficiency
1.5l/hr Not much
presently
known
Between
1.5-4l/hr
4l/hr 4+l/hr 4+l/hr
Maintenance 12.5% Planning to
enter market
12.5% 12.5% 12.5% 12.5%
PTO with
variable
speed
Available Not available Not
available
Not
available
Not
available
Not
available
3 Wheel
convertibility
Available Not available Not
available
Not
available
Not
available
Not
available
Rotavator and
Thrasher
Available Not available Not
available
Not
available
Not
available
Not
available
Water pump
attachment
Available Not available Not
available
Not
available
Not
available
Not
available
Generator
attachment
Available Not available Not
available
Not
available
Not
available
Not
available
Adjustable
wheelbase
(better
maneuverabil
ity)
Available Not available Not
available
Not
available
Not
available
Not
available
Flexibility
wrt usage in
industries/con
struction
Yes No No No No No
Market Share Less than
1%
Less than1% 26% 55% 15% 4.5%
Players Vanraj HMT Eicher - - HMT,
Punjab
Tractors,Ne
w holland,
John
Deere,Rena
ult
Growth rate
Over last 10
years
-0.37 -0.37 15.2 -2.90 -5.9 17.9