Strategic Analysis

of

NAME OF GROUP
MEMBERS:
B.Prabu (03)
SharadJain (20)
Saurabh Mahajan (28)
Rahul Goyal (46)
Nidhi Tiwari (55)
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Your ability to learn and change faster
than your competition is your only
sustainable competitive advantage
- Ajit Joshi
CEO & MD
Infinity Retail

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 INDUSTRY ATTRACTIVENESS
 Consumer Durable market Consumer Growth
is over Rs.35000 cr. Durable Rate (%)

08- 09
 Growth rate of 11.5% in Colour 12
 2008 – 2009 Television

 Predicted growth rate 12% Window Air 18.8
in 2009 – 2010 Conditioners

Washing 18.1
 The unorganized sector has
occupied a major share in Machines
manufacturing and
supplying VCD/MP3 Refrigerators 13.8
which has grown by 25%.
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 CROMA PROFILE
 Croma is promoted by Infiniti Retail Ltd, a 100%
subsidiary of Tata Sons

 Croma is India’s first national, large format,
specialist retail chain for consumer electronics
and durables


 Woolworth, one of the world’s leading retailers

provides technical and strategic sourcing
support


 Croma outlets stock 6,000 products comprising 4

 PERPETUAL MAPPING
HIGH QUALITY

VIJAY
CROMA SALES

HIGH
PRICE LOW
PRICE

UNORGANISED

LOW QUALITY
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 MERCHANDISE

 Large appliances
 Small appliances
 Computers and accessories
 Music & DVD
 Communication
 Gamming
 Home entertainment
 Imaging

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TARGET CUSTOMERS

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 CORE COMPETENCIES
 Access to wide variety of markets

Pan India presence (8 cities and 50 stores) and
100 stores by 2010
Difficult for competitors to imitate
 Technical and strategic sourcing support from
the world’s leading Australian retailer,
Woolworth
Higher merchandise mix in a
refined way

Computer accessories, electrical equipment,
gaming & music 8
ANSOFF ’ S PRODUCT / MISSION MATRIX
Existing New
products products

CROMA
CROMA

Existing 1. Market 3. Product

markets penetration development

New 2. Market
markets development 4. Diversification

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GENERIC STRATEGIES

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 SWOT ANALYSIS
 STRENGTH  WEAKNESSES
Large formats with good Lack of experienced personnel


ambience(Retail hot spot) Low in service quality



Tie up with Australian retailer

Woolsworth
Strong SCM due to sourcing from

abroad
Strong financial support

Brand equity

 THREATS  OPPORTUNITIES
New entrants from oraganized retail Pan India presence
Competition from grey market Innovations in technology

High labour turnover Increase in customer disposable

 income

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VALUE CHAIN

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 PORTER ’ S FIVE FORCE MODEL AND VALUE NET
SUPPLIERS
•High Switching Cost
•High threat to forward
integration
•High presence of substitutes
•Low importance of volume
SUBSTITUTES
NEW ENTRANTS
•High Industry Growth Rate •High buyer propensity
•Economies of Scale •low Concentration
•Product Differentiation to substitute
•High Fixed cost •High switching Cost
•Capital requirements •Low Switching Cost
•Switching Cost •Low Product differentiation
•Cost disadvantages

INDUSTRY •Low Switching Cost •MALLS

RIVALRY •High Profits •PRIVATE LABELS
•Low product differentiation

BUYERS COMPLEMENTORS
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Tetra Frame work Model:
Threats from Imitation:


 Easily imitable due to less government

regulation needed.
 To open a consumer durable store
amount needed is 1 to 4 crores , so
anybody can start it and give local
competition .
 Less product differentiation.


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Countering Threats from Imitation:


 By Getting the important locations for its

stores as it is one among the few pan
india level players.
 Making itself present in all important cities
across india.
 Differentiation is possible as CROMA has its
own private brands
 The sourcing and technical support of
woolsworth and IT infra structure from
TCS has really upgraded.
 Providing technologies that benefit the
customer through low power
consumption, and Low service
requirement,
 After sales services.
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Threats from Substitution:


 Internet virtual stores like ebay.com

 It can face substitution from other formats
of electronics which deal with only one
category(speality stores)


Countering Threats from substitution:



 Croma can launch its own version of E-

commerce.
 Croma itself can launch its own formats
which concentrate on a particular
product category. (Straddeling)

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Threats from Hold-up:


 Once government allows 100% FDI in muti brand

retail, Woolsworth will launch its own electronics
stores and croma will have trouble as its sourcing
of products depends on wholly by woolsworth.
 The manufactures of electronics durables can
themselves forward integrate to introduce
exculsive showrooms.


Countering Threats from Hold-up



 Opening stores in many cities, this will aid in three

ways. First they will enjoy first mover advantage.
Second they will get the volume in sales which
are necessary in wafer thin margin in this
industry. Finally the numbers stores present will
limit others stores from opening as all the
demands are satisfied.
 Launching its own private label.
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
Threats from slack:
 Croma has differentiated itself by having a very
efficient sales force which has good
knowledge about product. In future it may
find difficulty in finding human resource. All
ready Indian retail is has a challenge of
finding good human resource.
 The attrition rate in retail industry is high.
Countering Threats from slack:

 Tata group can open colleges which can be one

place stop for talented human resource. All
tata group companies can recruit from those
colleges.
 CROMA can offer incentives which motivates
the employees and keep them switching from
one company to another.

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 SCOPE
ØHORIZONTAL SCOPE
LOGISTICS COMPANY

ØGEOGRAPHICAL SCOPE
TARGET TIRE 2 AND TIRE 3 CITIES

ØOTHER ‘s
NEW RETAIL FORMATS
E-RETAILING
COMBINATION OF DIFFERENT CATEGORIES
FRANCHISE MODE

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 STRATEGIC RECOMMENDATIONS
 Increase merchandise & sale of private
labels over a period of time
 In house after sales service
 Display of new technological innovations
(working of blue ray disks)
 Strategic tie-ups with local companies (e.g
Zapak games etc)
 Explore B 2 B markets (e.g. Tie ups with
hotels, resorts etc for electronic and
electrical items)
 Should become a strong national force by
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 THANK
YOU
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