Launch of Lice Suk in India - Research Proposal Example

EXECUTIVE SUMMARY Launch of LiceSuk in India Personal Hygiene products have seen tremendous growth in 2007. Growth in revenue was partly due to high levels of inflation but volume sales also saw dynamic growth. Rising income levels have resulted in relatively lower-income groups being able to afford more personal hygiene products. Meanwhile, mid- and high-income consumers in urban areas began to seek out value-added mass brands and premium products. I am taking India as the country to sell the product as the huge young population of the country gives a huge customer base. On the top of it, owing to the temperature of the country and increased pollution level gives a better environment for germs and lice to foster. In order to fix the problem the mothers of young kids use greasy hair oils, harmful chemicals, time consuming nit combs, visit exorbitantly priced spas and parlors but almost never get the desired result. The product to be marketed is a vacuum hose attachment with a nit comb attached to the front which provides a convenient, safe and environmentally friendly way for a speedy removal of lice from the head providing instant relief to children from head lice and it will be launched in the Indian market by the name:- LiceSuk Juon ka sarvanaash (Hindi) (Complete wipeout of Lice) International Comparison Program'(2005) suggests that India along with five countries account for nearly half the GDP of total world as measured in PPP. More than half of the world's total population lives in just two countries of the world -India and China. Moreover these are the developing countries of the world which offer higher growth rate as compared to the already developed markets; and the economically developed countries like US and Germany are facing greater heat of recession with surging economic crises. Therefore one can think of investment in either India or China. I took India as the country to develop LiceSuk because there is a need of this new product in an Indian Market and till now no other company has launched this type of product in the Indian Market. Our Vision: Our vision is for LiceSuk to be'accessible on shelves worldwide; providing a safe, environmentally friendly, fast and effective alternative method to remove head lice and lice eggs at an affordable price for all. About LiceSuk: LiceSuk is a vacuum hose attachment with a nit comb attached to the front which provides a convenient, safe and environmentally friendly way for the speedy removal of lice from the head providing instant relief for children from head lice. It is a comb attachment which fits into a standard vacuum hose, utilizing the suction and removing both lice and eggs instantly. The LiceSuk'model'is a simple, lightweight,'hand held device which'has been designed to be placed into a vacuum hose to utilize the suction power, sucking out head lice and lice eggs from the infested hair. LiceSuk'is a safe,'environmentally friendly'alternative method'to the current head lice removal process involving lotions and fine combing. LiceSuk provides instant relief for'all; the lice are removed (sucked out) almost immediately. Features and Benefits of LiceSuk: LiceSuk is a once off purchase and being only 15cm in length it'can be easily stored away'for later use,'it can be used over and over again on the whole family - No more repeatedly buying expensive shampoos and lotions again! LiceSuk is suitable for all hair types (2 comb option, thicker and thinner). LiceSuk saves time as it sucks the'lice and lice eggs out almost instantly - No need for leaving lotions in hair anymore! LiceSuk is a safe alternative method which eliminates the'use of harsh, toxic, smelly chemicals - Great for those with sensitive skin! LiceSuk provides instant relief from the uncomfortable itchy feeling caused from the lice. A modern and ergonomical model, LiceSuk has been designed for ease of use. Maintenance and cleaning is very easy, simply'remove LiceSuk from vacuum hose, take off the comb attachment and wash'all components in'warm soapy water, dry and then store away for another time. How LiceSuk Works' The LiceSuk is a plastic tapered attachment that fits your common vacuum cleaner nozzle. The suction of the vacuum cleaner combined with the attached lice comb removes the head lice. The lice comb attachment is removable via a snap lock for different combs and easy cleaning. Lice get sucked into the vacuum cleaner's bag. Although it is recommended to clean out the bag it is not necessary as head lice live off blood from the scalp. Once they've been removed from the head their life expectancy is between 3 - 24 hours. Why LiceSuk' The most common treatment of head lice is insecticide shampoo and conditioning washes that work by attacking the nervous system of the lice. This is followed by pulling a nit comb through the hair to remove the dead lice however; lice are getting a resistance to chemicals on the market. Using washes are also time consuming whereas using LiceSuk should only take about 10 minutes to do with a couple of follow up treatments to get rid of any nits that have hatched and were not removed in the initial treatment process. Experts in lice recommend wetting the child's hair and covering it daily in conditioner when lice are discovered. It stuns the lice and slows them down for about 20 minutes. There is another vacuum attachment system which works on a similar concept to LiceSuk. This system's comb however is in the head of the nozzle. LiceSuk's comb protrudes out the front of the vacuum cleaner which the inventor says will make it easier for the comb to get really close to the scalp and as lice feed off the scalp it's very important to be able to get close. The LiceSuk works on a natural combing motion which is not distressing and less likely for the hair to go into the hose. Directions to use LiceSuk: Ensure hair is not tangled; you may want to slightly dampen. Place the tapered end of LiceSuk into vacuum hose and turn vacuum on. Start with thicker comb attachment to remove lice, comb LiceSuk through hair, then change comb attachment to finer comb and proceed to comb LiceSuk through hair again removing any left over lice and the eggs. Alternatively you can use LiceSuk without the comb attachment initially to suck lice out, but to complete the whole removal process including the removal of the eggs; the comb attachment needs to be run through the hair simultaneously International Market Culture: Before entering onto a very different market, the culture must be known. Culture is the manner in which things are performed within a society, community or nation. Culture is not a trait that comes with birth but it is learnt over a span of several years. The Terpstra and Sarathy Cultural Framework help marketing managers to assess the cultural nature of an international market. The Eight categories are Language, Religion, Values and Attitudes, Education, Social Organizations, Technology and Material Culture, Law and Politics and Aesthetics. Indian Culture:- 1. Language: - There are as many as 22 official languages in India. The national language of the country is Hindi and most of the people in the country are quite well versed with English as well owning to the British rule in the country for around 200 years. 2. Religion: India is considered to be a land of unity in diversity. Many religions are practiced in the country including Hinduism, Jainism, Buddhism, Islamism, Sikhism, Christianity etc. The cow is considered sacred in Hinduism. She is the one who should be worshipped for the various graces she bestows on humanity. 3. Values and Attitude:- Generally people in India have a high regard for their elders. Although traditional roles are changing, especially in urban areas, there are important values shared by most Indian families. Normally, Indians hold family progress, unity and support in high regard throughout their lives. Mostly people live in an extended family, in which every member has their own role, often determined by age and gender. There is typically a head of the family who takes the major decision with respect to the family and his decision is respected by everyone in the family. Elders are supposed to use their experience and wisdom to help guide younger members of the family. 4. Education:- As per the data of 2000-2004 from the Education for All Global Monitoring Report, UNESCO (2006), India has an adult literacy rate(15+ years old) of 61 percent and a youth literacy rate (15-24 years old) of 76.4 % which shows that India as a country has started to realize the importance of education reflective in its much higher youth literacy rate which indeed is a positive sign for the country. 5. Technology and Culture: - India has recently been identified on the world map as a preferred Information Technology destination. Moreover 65% of its population is below 35 years of age who are really enthusiastic and technology savvy. 6. Aesthetics: - Although India has a diverse culture, yet a lot of similarity can be observed in aesthetics. There fundamental ingredients of Aesthetics include rasa (pleasure), buddhi (reason), kama(pleasure), natya shastra(dance) and emotions. 7. Social Organizations: - what is the role of women in a society' How is the country governed - centralized or devolved' The level influence of class or casts upon a society needs to be considered. For example, India has an established caste system - and many Western countries still have an embedded class system. So social mobility could be restricted where caste and class systems are in place. Whether or not there are strong trade unions will impact upon management decisions if you employ local workers. 8. Law and Politics: - The political ideology on which the society is based will impact upon the decision to market there. India is a market-driven, democratic society with political parties like Congress, BJP etc. Modes of entry: Mode of entry in an International Market is a process by which a company can enter into a new International market. There are different types of Mode of entry: Internet Exporting Licensing International Agents and International Distributors Strategic Alliances (SA) Joint Venture Joint Ventures tend to be equity-based i.e. a new company is set up with parties owning a proportion of the new business. There are many reasons why companies set up Joint Ventures to assist them to enter a new international market: Access to technology, core competences or management skills. To gain entry to a foreign market. Access to distribution channels, manufacturing and R&D are most common forms of Joint Venture. So, a Joint Venture with the Indian company Marico can be implemented; as the company is a well reputed brand in India for Hair care. Marico's Products and Services in Hair care, Skin Care and Healthy Foods reach out to more than 20 countries in the Middle East, Asian sub-continent, Australia and USA. The company generated a turnover of about Rs. 19.1 billion (about USD 455 Million) during 2007-08. Marico markets well-known brands such as Parachute, Saffola, Kaya, Sundari and Fiancee to name few, most of which enjoy leadership positions (No. 1 or No. 2), with significant market shares in respective categories. They have a brand called Mediker which is an Anti Lice Shampoo but the company is not taking care on its development and expansion. So we can have a Joint Venture with Marico India Ltd. And can enter into the Indian Market by the name Marico-LiceSuk. Product target market The target market to be initially focused on could be the parents especially the mothers of school going kids. Market Research (Primary Research): Before entering into the market, a Primary marketing research has to be done and it is the part of Market testing and analysis so that the likes and dislikes of the consumer can be known. The data for Primary research should be original and collected for a specific purpose, or to solve a specific problem and the purpose should be to enter lavishly in the market of Personal Hygiene and hair care. Generally interview is considered as the most proper and interactive way for primary research. Interview can be both telephonic and face to face and generally staff like tele-callers can be recruited for market researchers or even it could be done independently. The target crowd for research for this kind of a product line should be parents and especially the mothers. The market researchers should be given the target market list. Several questions; a few open ended questions and remaining close ended questions could be considered in a questionnaire which should be helpful for Market testing and analysis: The questionnaire could be of the following sort:- Do you have young kids' a) Yes b) No Do you use any Anti lice products for them' a) Yes b) No If yes, how often do you use any of them' a) Daily b) Once in a week c) Very less Are you happy with the performance' a) Yes b) No Which type of Anti Lice product/service do you use' a) Hair Oil b) Shampoo c) Nit Comb d) Spa (service) Do you go for a particular brand while buying an Anti lice product' a) Yes b) No What specific expectation do you have from new Anti Lice Product Company(apart from removing lice)' Ans-------------------------------------------------------- Name- Age- Gender- Occupation- Interview can also be conducted on the Internet by pop up windows and flashes. Even a website could be launched, such that visitors are asked to complete the electronic questionnaire. Internet being relatively economical and easy to access could be a definitely help in future as well. The Visuals of product LiceSuk and other USPs can be very easily shown through the internet. Financial Analysis: Expected Revenue FY09-10:- The base price will be taken as Indian Rupees as the manufacturing and selling will be done in India. For all the conversions, the approx. rate of conversion of Rupees as compared to Australian Dollar is:- 1 Australian Dollar = INR 35 There are around 450 million females in India. Our target consumer is the population residing in the cities. About 27% of total population lives in cities (India Finance and Investment Guide, 2001). On an average in a typical Indian family there are two females, a mother and a daughter, so both may share the product and on an average the target consumer base should come around:- Target consumer base = No. of females residing in a city in separate houses. = 450 * 27/100 * ' million = 60.75 million. (Approx. 60 million) The major benefit is that there is no existing competitor in the market and therefore we could target at having a deeper market penetration for our product. Even if we take a conservative estimate of 10% then we should hope to produce around 6 million products for the country in the first year of operations. Considering the spending capacity of an average middle-high range lady, one unit could be sold at a price of approx. INR 350 in India. For the first year, we are targeting around INR 500 million as a promotional cost for the product. The cost of production for every unit would be somewhere around INR 200. Therefore the cost price of every unit will be approx. C.P. = Cost of production + marketing cost/total number of units = 200 + 500/6 = INR 283 The Net Profit will come out as Profit before Tax= (S.P- C.P.). = (350-283) = INR 67. Considering an average tax rate of around 30% the PAT = 67*0.7 = INR 46.9/unit Percentage Profit = PAT/C.P * 100 = 46.9 / 283 * 100 = 16.57 % So we hope to make a very healthy average profit of around 16.57% with our joint venture in its first year of operation itself. Manufacturing and Distribution Network: Manufacturing Unit: Silvassa is the capital of the Indian Union Territory of Dadra and Nagar Haveli which enjoys a cosmopolitan mix of non-local people. This city can be selected for the manufacturing unit because of the tax exemptions offered to locate manufacturing in this (commercially) backward area. Distribution and Sales Headoffice: In order to focus on building urban and rural sales as well a strong distribution network must be there in both urban and rural areas. Mumbai is the capital of Maharashtra and it can be chosen to have a Sales headoffice to target East and Northeast India, North India, South India and West India. Service Strategies Promotion and making aware of what is available to the customers and what the offerings are is the important and an essential part of any marketing strategy; keeping this in mind we at Licesuk, can promote the Unique Selling Proposition (USP) i.e. convenience at an affordable price to the customers. Name and the Logo- LiceSuk And the Punch line- Juon ka sarvanaash Also, Attractive pamphlets could be created and distributed through the volunteers to the target customers. Electronic advertisement could be published and telecast for 'LiceSuk-Juon ka Sarvanaash' Discounts could be offered through contests or through kitty parties. Also, a very popular beautiful Indian Kid Model who has recently been a finalist on a Beauty Pageant for kids can be chosen by us as our Brand Ambassador. We have also launched a website named as licesuk.com as we know that technology plays a very important role in the delivery of service today. Internet being the revolution is the easiest way for the customer to order for. Conclusion: Personal Hygiene products are expected to see even stronger growth during the forecast period in constant value terms. This will be chiefly due to rising income levels in the developing country-India. In addition, distribution is expected to improve for these products and consumers will have greater access to buy it. LiceSuk therefore will effectively cater for a wide range of Indian consumers, driving sales growth as a consequence. References: About us. Marico Ltd. Retrieved April 4, 2009, from http://marico.com/abt_marico/index.html Aesthetics in Asia - India. Retrieved April 2, 2009, from Aesthetics in Asia - India Cosmetics and Toiletries in India. (2008). Euromonitor International. Retrieved April 2, 2009, from http://www.euromonitor.com/Cosmetics_And_Toiletries_in_India International Marketing and culture. Marketing Teacher. Retrieved April 3, 2009, from http://www.marketingteacher.com/Lessons/lesson_international_marketing_culture.htm Kotler, Philip. (2003).Marketing Management. New Delhi: Pearson Education (Singapore). Languages of India. webindia123.com. Retrieved April 3, 2009, from http://www.webindia123.com/india/people/language.htm LiceSuk. Retrieved March 31, 2009, from http://licesuk.com/services Modes of Entry into International Markets (Place). Marketing Teacher. Retrieved April 3, 2009, from http://www.marketingteacher.com/Lessons/lesson_international_modes_of_entry.htm Image Credit: http://www.tourism.holdfast.sa.gov.au/site/page.cfm'u=656 Read More