Lukman Kresno O. 29110394Yohanes De Deo Tedo 29110399Ronaldo Bagus Putra 29110404Anggi Fitrining Tyas 29110400Wisnumurti Rahardjo 29110412

BackgroundEstablish in 1922Jointly held by Burmah Shell, Shaw Wallace,

Tata Steel.Manufacture tinplate (packing kerosene)• Uninterrupted supply of raw material• Supplied tinplate in 4 major product segments:

Edible oil cansSoft drink crownsProcessed foodBatteries

Company Overview

Problem Statement

Should it continued in the edible oil segment?

How can TCIL compete with Foreign Company?

What strategies can TCIL formulate based on organizational buying behave concepts?

Analysis

Classification of Tinplate

Prime grade tinplate

Free from any visual defectFor food and batteryThe customer had high-speed can-making equipment

Secondary grade tinplate

Banned for food packagingUnsuitable for battery jackets“Become Carcinogenic”

RAW Material

Tin Mill Black Plate (TMBP) imported

Supplying raw material by combining cold and hot rolled coils from Tata Iron and Steel Company (TISC)

Imported PRODUCT

DISTRIBUTION and PROMOTION

TCIL factory in Jamshedpur India.

Product distributed through network of 15 agents throughout country in edible oil can.

A sales team of 20 personnel interacted with customers in other segments.

Dominated by personal selling.

Application of Tinplate

Competition : B2B Price Sensitive Segmentation

Price Sensitive – Large Market Lack of MonitoringUse Secondary For FoodConsumer Unaware of the negative

consequencesIndia’s low literacy level

Growth of Tinplate

1993 1994 1995 1996 19970

5

10

15

20

25

BatteryEdible OilCrownProcessed Food

Battery

Parameter TCIL FRITZ SUKAI

Temper 2 5 4Size 2 5 5Dimension 2 5 5Productivity 3 5 4Service 3 4 3Price 5 4 4Delivery 3 5 5 2.9 4.7 4.3

Edible OilParameter TCIL SAIL OTHERS

Price 3 4 5Brightness 5 4 2Delivery 5 3 2Service 5 3 2

4.5 3.5 2.75

Soft Drink CrownsParameter TCIL FRITZ SUKAI

Size 2 5 5Dimension 2 5 5Price 3 5 5Delivery 5 4 4Temper 3 5 5

3 4.8 4.8

Processed FoodParameter TCIL TMN SUKAI

Delivery 5 4 4Lacquer Adhesion 4 5 4Temper 3 5 4Price 5 4 4Dimension 3 5 4 4.0 4.6 4.0

Customer Satisfaction

Market Share

10%

45%

45%

Battery

TCIL FRITZ SUKAI28%

18%

54%

Edible oil

TCIL SAIL OTHERS

10%

45%

45%

Soft Drink Crowns

TCIL FRITZ SUKAI

22%

78%

Processed Food

TCIL TMN

Selling Price (Rs per MT)

TCIL’s Costs (Rs per MT)

  Battery Edible Oil CrownProcessed

Food Manufacturing Cost 27000 22000 25000 26000 Selling Cost 800 200 700 600 Distribution Cost 250 250 250 250 Cost of Credit 1400 450 1000 1350 Profit 6000 3000 3000 5500 Profit Margin 16.93% 11.61% 10.02% 16.32%

Segment TCIL SAIL FRITZ SUKAI TMN Unorganized

Crowns 29,950 - 35,56034,99

0 - -

Battery 35,450 - 44,50046,00

0 - -Processed

Foods 33,700 24,000 40,10041,30

043,00

016,000 – 19,000

Edible Oil 25,850 20,000 - - -13,000 – 17,000

Segment Pros Cons

Edible Oil

Competitor are unorganized company

Highly price sensitive

Catered to company that were more sensitive to specific product Parameter

Higher price than competitor

Market leader Low profit margin

Unorganized Company on the market

Battery

High profit margin Low customer satisfaction

Lowest price in the market

Less market share

Increasing market growth

Segment Pros Cons

Soft Drink Crowns

Dominated by Pepsi and Coke

Consumers has more favorable perception of foreign company

Low customer satisfaction

Dominated by foreign company

Low selling price Low profit margin

Increasing market growth

Less market share

Processed Food

Average customer satisfaction

Consumers has more favorable perception of foreign company

Competitive selling price

Unorganized company on the market

BUYING INFLUENCES IN TINPLATE PURCHASES

  Purchaser Decision Maker Influences User

Battery Purchaser CEO Production/ Marketing/ R&D

Production/ Quality Control

Edible Oil

Purchaser/ Owner/

Vanaspati Company

CEO/ Owner/

Vanaspati Company

Middleman/ Marketing

Production/ Quality Control

Crown Purchaser CEOProduction/ Marketing/

Quality Control

Production/ Quality Control

Processed

Food

Purchaser/ Owner/

Vanaspati Company

CEO/ Owner/

Vanaspati

Marketing/ Packaging Division/

Production/ Quality Control

Production/ Quality Control/

Packaging Division

ORGANIZATIONAL BUYER BEHAVIOR MODEL

ExternalInfluences

- Marketing / middleman- Production- Quality Control- Packaging division

InternalInfluences

- High quality perception of foreign companies- Price sensitive- High service expectation- Consumer ‘s buying behavior

OrganizationalCulture

Decision Process

Situations

Problem Recognition

Information Search

Alternative Evaluation and Selection

Outlet Selection and Purchase

Post purchase Processes

Needs /

Desire

Experiences and Acquisitions

Experiences and Acquisitions

SOLUTION

Keep the edible oil segment

Even the lower profit margin and high price, edible oil still has good customer satisfaction

From the customer satisfaction table, only price doesn’t get perfect score, so with decreasing the price, TCIL could get bigger revenue and lower manufacturing cost

Also TCIL could get products from unorganized company which has lower price than TCIL’s production cost

Strengthen TCIL market in battery segment

With increasing battery’s market growth, TCIL could get their market on the future to increase their market share and revenue

TCIL must invest more in their battery division to get their batteries fulfill customer wants

CREATE AWARENESS ABOUT THE DANGER OF SECONDARY GRADE TINPLATE IN FOOD PACKAGE With increasing the awareness of food

package, the customer would choose products with good packaging

With declaring that TCIL only use prime grade tinplate in food package, customer would believe that products with TCIL package has a good benefit for them

This would affect TCIL’s market to choose TCIL as their suppliers

TCIL could create advertisement about good package for foods and shows the products that use TCIL as their food package

Fulfilled the influencer expectation

•Improve specifications and speed of flexibility to deliver consumer needs

•Because the purchase decision is made by the CEO or owner, and the decisions are influenced by the influencer, so TCIL must influence the influencer

Long term contract with customers

• With long contract with customers and suppliers, TCIL could keep the price at some level and decrease the risk of foreign exchange

• Sign contract with Pepsi and Coca-Cola as a big customer

Lesson Learned

Lesson LearnedConcentrate on fewer segment

could increase revenues and market share

Fulfill customer needs to make sure that our products is not useless and create loyal customers

THANK YOU….