1. The document discusses the Indian elevator industry market segments and key players like Otis. 2. It analyzes factors driving growth in the industry like urbanization and increasing population as well as challenges from regulations and new entrants. 3. The supplier management is a key success factor given the stringent manufacturing process for elevators and customized solutions can increase costs and lead times.

1. Submitted by:
Nilesh A. Mashru, PGDIBS - 2012
Submitted to:
Dr. Mridula Mishra @ IIFT, New Delhi

2. Segment % Mkt Share Stop Speed MPS Schindler Products
Manual 50% 2-8 0.5-0.7 Not available
Low Rise 35% 2-15 0.6-1.5 S001
Mid Rise 14% 16-25 1.5 S300P
High Rise 1% >25 >1.5 S300P

3. KEY FACTS
1. Manual Elevators with 50% market share slated to get replaced due to
legislation
2. Otis leading the market share as well as perceived brand image
3. Otis considered VFM product and enjoyed high customer retention
4. Service first in influencing factors of Elevator purchase thereby giving
Otis an edge. Price a close follower with reliability & technology given
importance over brand image and delivery.

4. 1. Increase in Import Duty
2. Increase in Transfer Rates 1. Growing Indian Economy
2. Growing Tourism & Hotel Industry
1. Rapid Urbanization
1. Govt ban on Manual
2. Metro culture in cities
Elevators
3. Sophistication of buildings
2. Step accepted by States
& enforced to follow
INDIAN with advancement in
technology
3. Competition responded ELEVATOR 4. Perception of Elevator as
positively with new
products
INDUSTRY basic commodity
5. Increasing Population
6. Relative pricing - % cost
of elevators to the
apartment cost dropping
7. Hire purchase facilitates
need for more
apartments
1. Advancements in Elevator Technology
1. Growing economy increasing concerns
2. Paradigm shift in customer’s mindset – looking
on Environment protection
for better services & facilities
2. Government emphasis on Environment
protection 3. Growing demand for top quality high rise
buildings

6. Strong Competition and push from
regional players to intensify rivalry
Entry of Players like Mitsubishi & Hyundai.
Although it is a capital intensive industry,
but the entry exit barriers being low, threat
of new entrants is high.
Customers demands rising for
customized products and better
services. High bargaining power due to
availability of substitute products.
Limited support from the European plant and
increase in the originally estimated transfer
price leading to low competitiveness. Also
customization of products was not supported.

9.  Manufacturing of Elevators comprises of stringent process cycle right from
sourcing to final product
 Supplier performance and management a key to success to ensure
continuity and competitiveness. Factors like standardized material specs,
distance from manufacturing location, consistency in quality & price are
major influencers
 Standardization of the process cycle is very high and hence adapation cost
could be higher.
 While a fair estimate could not be traced, estimated cost difference for
including specialized panels in S001 would cost anywhere from 15-20%
considering material as well as labour & logistics costs.
 Lead time of the delivery could also increase due to non-standardized
requirement.