introduction An idea evolved in the mind of a small farmer, turned into a mini tractor. Innovation was done at the grass root level. Mini tractor was made in view of the small & individual farming need. It was made to eliminate the problems created by the usage of bullockcarts in the fields. Mini tractors reduced the working hours of the farmers.
The dilemma Targeting will be successful or not. The estimated sales and revenue growth will be achieved or not. This market segment will be according to the company goals and objectives or not.
Benefits of mini- tractor Affordable price. Gear selection facility. Lower operating cost. Limited liability. Low maintenance & easy Useful for material handling repairs. in small industries, warehouses, & airports. Smaller wheel base & turning radius. Best for interculture operations. Accessibility to smaller areas. Reduces man hours. Multitasking. Three wheeler convertibility. Having a tested power take– Single piece casting. off point.
Weaknesses Lack of experience. Lack of market research Lack of concept testing Higher price compare to other mini tractors. Conservative estimate of sale & revenue growth.
Opportunities Highly potential market (world largest market for tractors) Third largest gross cropped area High number of marginal & small farmers Less tractors per 1000 hectare of land Increase in total irrigation area. Increase in horticulture land Increase in intercultural farming Easy financing to small farmers. Lack of big players
Threats Chinese tractors dumping in Indian market Indirect completion from assembled tractors manufactures Govt. restrictions Unexpected climatic condition Customers drive towards earning potential in custom hiring of hire horse power tractors.
Drivers of tractor demandCommercialization of agriculture.High level of govt. support.Easy financing.Increased agricultural land & cropped area.Increased technology need.
Competition Company is entering in the new segment and this segment was not catered by any big company. There is a indirect competition from some assembled tractor companies, like- trishul, field marshal, captain. These are not the refined product. Competition from Chinese dumped tractors. Different promotional offers are introduced by competitors like – Exchange of old tractors. Longer credit period. Credit sales.
PEST ANALYSIS This case is not too much influenced with politics Economical the company was the small scale industry and the customers identified were small and marginal, large and horticulturist etc. Company got funding from the government wing for the technological refinement Sociological factors - product was focused to cater small usage which was not tackled by the big tractors. Most of the consumers were small and marginal farmers. For the buying the tractor they consider the HP as the main factor but beside this there are other factors like it is a status symbol also it is the sign of prosperity also tractor purchase also has lot of other social significance.
CONT….. Technological aspect The marginal farmers are still dependent on the bullocks and other manual systems. Farm mechanisation has lot of value in terms of the upliftment of the poor and increasing the productivity In tractor industry HP is the main criteria and most of the technological aspects are covered in this case
MARKET SEGMENTATION Demographic segmentation Geographical/ Segmentation based on Topography of soil Product segmentation (Engine horse power)
Demographic segmentation On the basis of land holdings: Small & marginal farmers: In this category the level of mechanisation is low and they used bullocks for tilling and agricultural operations. Moreover they had small land for farming and the Vanraj tractor was focussing this segment as its target. Large farmers: This section was catered by all the big players as they have large area for farming and the farms were highly mechanised. They usually preferred tractors having HP more than 20.
CONT….On the basis of type of occupation: Industry: Industry wise they are divided into small scale firm, national, and multinational players. Horticulture: This segment of cultivation requires specific design which would facilitate the cultivation process. It requires intercultural operations like removing weeds and creation of soil. These functions could be well performed by tractors having “three wheel convertible features” which is observed in Vanraj tractors.
Geographical/ Segmentationbased on Topography of soil North India: The regions like Punjab, Uttar Pradesh, and Haryana were dominant in tractor sales. As the soil is alluvial they require tractors with less HP. South and West India: In the regions like Gujarat, Maharashtra and Madhya Pradesh the soil is harder type- Laterite and black soil where more HP tractors are required
Product segmentation (Engine horse power) Mini tractor: The tractors which are having less than 20 HP are considered to be the mini tractors and Vanraj being one of them. Small tractor: Tractors having horsepower between 21 and 30 HP are considered as small tractors. Medium tractor: Tractors having horse power between 31 and 40 HP were included in this section. Large tractor: Tractors having horse power more than 50 HP were included in this section.
The segmentation on the basis ofland holdings is important as’ This segment is not served by big players, as they are interested in more margins. In this segment about 82% of the people do not have tractors, thus having more scope for future. Land holdings are smaller, for small farmers it is 0.4 hac & for marginal farmers it is 1.4 hac. Thus they need a tractor which is not bigger in size. The Vanraj tractors are of 10 HP and hence it would be best suitable for small and marginal farmers due to its low cost and lesser fuel consumption with more utility and less maintenance.
Recommendations Company should go for a market research. Company should refine its marketing strategy to make it more B2C focused. Company should do a concept testing. Sales and revenue estimation should be according to the research outcomes. Market should be analyzed to know the customer buying pattern & their actual needs.
Conclusion “Small is beautiful” and “the bigger the better” But“Big things look small from outside and come in small packaging”