ALDI Manager

Case study

Company “Credit Finance” is leading finance company in Mobile segment, approaching Home Appliances and
Furniture markets. Company is providing POS & Cash loans. Your role as ALDI Manager is to implement all
new business initiatives, develop and plan sales execution strategy for new products and sales channels, make
comprehensive analysis of sales performance, make conclusions about region performance. Now you have
been asked to select region for pilot of new product - Extended warranty. You have to consider local areas
specific and Company’s strategy. Regions’ characteristics, key metrics and overall descriptions are given
below.

a) Region “North”. Number of active POS is 2,390, potential is ~12,000. Sales results: May – 24,600 units,
June – 23,879, July – 22,576. Region contributes in 43% of total sales volume. Productivity of POS in general
is high, as well as competition level. Main competitor “Y” presents in 24 cities and covers 1.6 times more
population than Credit Finance. Local management team is strong and mature, Regional Manager Sandeep K.
is 5 years in the system, was appointed 2 month ago from similar position in region West, where he was able
to show exceptional results and demonstrated great leadership. However, not all team members in North
accepted him as leader, 2 Area managers and 6 District managers resigned. As well team started to face issue
with SA attrition which recently became 5% per month. High attrition may be caused by activity of new market
player “X” started aggressive expansion campaign from North. Team need to hire 560 SA in next two month
to fulfill POS opening plan.

b) Region “South”. Company started expansion only 1 year ago, expansion was extremely fast and local team
was able to open 1,390 POS which is approximately 74% of overall market potential of region. However,
productivity is lower than in other regions – 27% lower than North and 14% lower than West. Competition is
level is average, main competitors presented in other segments than Mobile, mostly focused on High score
customers. Recently local authorities introduced additional requirements for all NBFCs – it says that to provide
loan Company has to complete KYC of Customer and all his/her family members. It will become effective in
next 4 month and all market players expect significant drop in volume of sales, estimation varies from -17%
to -32% in volume. Total team headcount is 2,150 employees, 82% of them are SA and DSM, the rest are Back
office, Security and other functions. South has highest number of managers per subordinate in company – 1
DSM per 7 SA, target is reach 10 SA per DSM ration in next 3 month as in other regions.

Company’s strategic goals for next financial year is reach No.1 market position in all regions. Launch new
product lines e.g. Value Added Services and EMI Cards for existing customers. Company plans to introduce
paperless loan origination process and launch new risk strategy which will decrease approval rate to 58% but
significantly improve risk.

Task – Select one region to pilot new product Extended warranty. Pilot duration is 2 month of sales and 3
month post sales observation. During pilot should be signed 10,000 extended warranty contracts. Your budget
for product promotion is 5 mln INR inclusive additional incentive, promotion and dealers’ support. Prepare
pilot execution plan, i.e. metrics, timelines and resource plan.

Prepare ppt not more than 5 slides, be ready to present this topic on ExCo meeting, you will have 15 minutes
for presentation including answering on questions.