Nalli silk sarees

Nalli silk sarees

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  CaseStudy Analysis On Nalli SilkSarees Submittedto: Submittedby: Dr. ArvindKumar Jain Raghav Agarwal Associate Professor (500044376) (Department of Marketing) BBA-Retail Management (1st Year)
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  Nalli Silk Sarees Itwas founded in 1928 by Dr. Nalli Chinnasamy Chetty. Vice chairman of the company was Mr.Ramanth K. Nalli. It has 22 retail stores across the country and was supposing to build 12 more retail stores with the funded amount of 25$ million. It is a 95$ million company. It has out done its competitor by being the only player in its segment to have a national presence. But over the years the business has become more complex to manage because of the increase in the growth of retail stores and the proliferation in the number of stock keeping units that had to be managed. Nalli was applying a uniform pricing margin for all the products in its stores across the country this led to increase in the cost of the product but it didn’t the price of its product. As we know that India is the largest producer of silk after china as there was two types of silk one was ‘zari’ and another was ‘pure zari’ and nalli was the first saree retailers to implement a retun policy as a testimony of the quality of its sarres. Nalli deals with different product suits which are women wear, men wear, children wear, and other products. Top Competitors  Kala Niketan  Kumaran Silk Sarres  Roop Kala  Sheetal Sarees  Sundari Silks  Pioneer Embroidery Limited
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  Problems Faced Bythe Nalli Company  Competition –The Company started facing huge competition from large Indian & Multinational Companies who is dealing in this sector.  Supply Problem- Shortage of labor supply was a major issue in weaving industry in India. Young generation weavers are looking for stable income and comfortable lifestyle so they are more interested in joining software jobs.  Shelf Space- Shelf Space was similar across all the outlets. It was also a problem because shelf space should be made according to the living, choice, and likes of the people of that area. If rich society is living then they could decrease the low-value products like fabrics and dhotis and increase the shelf allocation with traditional wedding sarees that have high costing. It is not necessary that same type of customers is found everyplace.  Pricing- The prices of the Kanchipuram silk sarres could range from $100 to $ 2000 dollars which means they charge premium from customers and in return they provide premium services and the competitors were offering at cheap rates. Peoples were not able to afford it.  Limited Brand Awareness- They were not known about the products available in the market segment. The stores entertain only the social contacts.  Promotional Strategy- theCompany fails to go for new promotional strategy. It only have ‘word of mouth’ publicity and on other hand its competitors were aggressively making adervertisment and offering huge amount of discount and offers.
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  SWOT Analysis Strength  BrandName - The Biggest strength of a company is its brand name. As nalli was enjoying a good amount of monopoly in market with kanchipuram silk sarres as they were only the producer of the kanchipuram sarres. They were providing pure zari which was increasing the brand value of the product.  Imported Dye -Nalli sarres were only the first to bring the vegetable dye which they often have to import from outside. They have taken first mover advantage.  Technology – Nalli sarres have took the first mover advantage in technology which was barcode, computer billing system and system administration room.  Trust in Customer -As the company was working in the dynamic environment so the firm has to build trust among the people as today there are around 60% of brand loyal person.  Product Range -As competition was increasing so, nalli sarres were increasing the number of goods available with him. They were providing proper shelf space for the product Weakness  Lack of Feedback – Feedback is one of the important policies in marketing as the company is able to consider the preferences and thinking of the customer about our product. So, there was no any feedback system.  No offers and discount policies – The Company was not offering any types of offers and discount on its product even they know that there are many competitors which are offering huge discounts and offers especially on the peak season.
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   Weak Advertisement–No proper advertisement were followed by the company to attract the customer segment. Only ‘word of mouth’ publicity were done.  Uniform Pricing –We know that having uniform prices is good the company because of the brands loyal it was working but sometimes people are not brand loyal easily. So company must reduce the prices of its product to attract the customer of lower segment. Opportunity  E-Tailing – In 21th century with evolution of modern technique the company can go for its online sales of product and customer can also came to know about your product and company.  Expansion in different areas –The Company can launch or can add new products in the market and its timeline. The company can go market which is yet not affected by the other player. It can be a type of first mover advantage to them.  Expansion in product line – The Company can launch new product in the market and add in their timeline. They can extend their western clothes and traditional dress to boost up their sales because we can say, that today’s youth focus is more on western outfit. Threats  New Brands - Many new saree brands are coming in the market with new innovative colors, designs and latest techniques. This is a threat for the company as the business can turn into failure if any new saree brands occupy the large market share in the market.  Regional Market Competition - Many people in villages are still doing weaver jobs and work in cottage industry. They can provide raw materials to other companies at cheaper rates. So, there may be chances that company may face regional market competition.  Matching up with the Trend - People nowadays are shifted more towards western trends as it becoming fashion for today’s generation. The company is not matching up with the trends. This can
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  soon results inclosure of traditional market and expand of western clothes market. Porter’s Five Force Model Nalli Silk Sarees Rivalry industry  Low customer loyalty  Unique characters and structure  E-tailing  Introduction of Dye  Technology Threats of new Entrants  No Barrier for new Entry  New Competitors  Trend of new products  Reduction in cost  New Technology Bargaining powerof customers  Individual buyer  Some consumer are not price sensitive  High substitute  No offer and discount on lot purchase Bargaining power of supplier  Less concentrated suppliers  Large number of potential supplier to exchange them  Labor supply  Costof raw materials Threats of Substitute Product  High threat of substitute  Brand image and recognition  Entrance of new products in market
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  Marketing Mix The companyneed to do marketing for its products because from initial time the customers were most of social contacts and the company was also not able to attract new customer segment. It needs to adopt aggressive growth strategies which are adopted by its competitors. The company should start spending on advertisement so as to gather more customers towards their products. Other than word-of-mouth, Advertisements can help to remove the problem of limited brand awareness. The company should start offering some sort of discounts on their products as to beat their competitors because competitors are giving huge discounts on peak buying seasons. The company can give discounts to their special customers for being brand loyal and can also offer discounts to new customers on special occasions like Diwali, Karvachauth, and Holi etc. Product Mix Price – As price was the main factor of the company which was troubling them in sales as they have considered premium prices for Kanchipuramn silk sarres which was not affordable by everyone. And respect to that they were providing services to the people. Promotion –As we know that promotion plays an important role in every company to boost their sales but here, company was not actively participating inpromotionactivities and using ‘word- of – mouth’ publicity. Product –They were very unique in their product as they were selling Kanchipuram Silk Sarres which they do not have any competitors.
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  Packaging- With thecharge of high prices for commodities they were giving premium services which were in turn related to good packaging criteria for them.