Titan

By LokeshLokesh.ubs@gmail.comAugust 2013University Business SchoolPanjab UniversityChandigarh,Sector-14www.ubs.puchd.ac.in

Acknowledgment

A scholarly and quality work like designing of any project can be accomplished by motivation guidance and inspiration of quarters besides the individual efforts. Let us in this page express our heartiest gratitude to all those who helped us in various stages of this study.We wish to express our deep sense of gratitude to our guide Prof. Manoj Kumar Sharma for his valuable guidance and kind cooperation without which this project would have not been possible.

ECONOMIC ANALYSIS OF TITANLokeshMBA(General) Section-BAugust 2013

Abstract

This set of notes guides you on the format of student research projects in Businesseconomics.

Keywords:- research, writing, survey.

Contents

Introduction

Determinants of demand

Demand forecasting

Consumer survey

Production analysis

Cost analysis

Market structure

Conduct

Bibliography

Introduction

Titan Industries is a manufacturing company that produces India's largest and best-known range of personal accessories watches, jewellery, sunglasses and prescription eyewear. Precision engineering is another area of specialisation that Titan Industries excels in.Titan Industries was established in 1984 as a joint venture between Tata and the Tamil Nadu Industrial Development Corporation.The company brought about a paradigm shift in the Indian watch market, offering quartz technology with international styling, manufactured in a state-of-the-art factory at Hosur, Tamil Nadu. In 1995, the company diversified into jewellery under the brand Tanishq to capitalise on a fragmented market operating with no brands in urban cities. In 2005, the company launched its second jewellery brand, Gold Plus, to capitalise on opportunities in small towns and rural India. The company has also made its foray into eyewear, launching Fastrack eyewear and sunglasses, as well as prescription eyewear.Areas of businessTitan's main products are:Watches: The four main watch brands include Titan for the mid-premium segment, Fastrack focused on the youth and trendy fashion space, Sonata for the mass market and Xylys for the premium market. The Titan brand architecture comprises several sub-brands, each of which is a market leader in own space. Notable among them are Titan Edge, Titan Raga, Nebula and other collections such as Zoop, Orion, Purple, Obaku, Automatic, Tycoon, Bandhan, Octane and the HTSE series.The company manufactures over 15 million watches per annum and has a customer base of over 100 million. Today, the Titan portfolio has over 60 percent of the domestic market share in the organised watch market. Watches are sold through exclusive World of Titan' showrooms and at 12,000 multi-brand outlets in more than 2,500 cities in India and internationally in over 32 countries, primarily in the Middle-East, Asia Pacific and Africa. Its after-sales-service is itself a benchmarked operation with modern service centres offering some of the fastest turnaround times in the world. The company has a world-class design studio for designing watches and accessories.Helios, India's multi-brand watch retailer, offers an unmatched range of the latest designs across 30 international brands in addition to Titan brands.Jewellery:Tanishq offers a premium range of gold jewellery studded with diamonds and precious, semi-precious stones in various hues in 18KT and a wide range of plain gold jewellery in 22KT pure gold. Platinum jewellery also forms part of the product range. Gold Plus retails plain gold jewellery offerings with designs specifically created for the semi urban and rural Indian market and offers unique designs crafted with diamonds, american diamonds and other precious stones. Zoya offers premium studded jewellery catering to the needs of the elite. The jewellery division has its own design studio.Eye wear: Titan Eye+ offers a variety of differentiated products to the end consumer consisting of frames, lenses, contact lenses and accessories. Frames are available in both international brands (Levis, Esprit, Hugo Boss, etc) and in-house brands Titan Eye+ and Dash. Customers are offered a unique browse-select-buy format where all products are accessible, using world class equipment for zero-error eye testing by qualified optometrists trained at Sankara Netralaya and style consultants to help buyers make the right choice of frames and lenses.Precision engineering: The divisions products span precision engineering components and sub-assemblies, machine building and automation solutions, tooling solutions and electronic sub-assemblies. The division is ISO 9001:2000 and ISO 14001:2004 certified. Additionally, the unit catering to the aerospace segment is AS 9100B certified and the unit catering to automotive segment is TS 16949 certified. The unit has recently been selected for the National Aerospace and Defence Contractors Accreditation Programme for its non destructive testing capabilities.LocationHeadquartered in Bengaluru, India, the company has manufacturing and assembly operations at Hosur, Dehradun, Roorkee, Pantnagar and Chikkaballapur, and an electronics component manufacturing plant in Goa.

Titan is a part of the TATA Group having a turnover of about USD 30 bn, equivalent to over 2.5% of Indias GDP and having the biggest market capitalization in India The Tata group is Indias largest employer in the private sector 222,000+ employees across 85 companies The TATA group has achieved many Firsts for India: First private sector Steel mill First private sector Power utility First luxury hotel (Taj) First Airline (now Air India) The Worlds least expensive car (Tata Nano) Indias largest software company (TCS) Indias largest watch & jewellery mfgr (TitanTitan is the worlds fifth largest, integrated own brand manufacturer for watches Commencing production in 1986-87, the Company is today the leader in the Watch & Jewellery businesses in India

First & largest player in the branded jewellery segment (Tanishq) >60% share of the organised watch market Over 90 million watches sold across 30 countries, cumulatively Manufacturing Facilities

Main Watch & Jewellery plants in Hosur near Bangalore. Watch assembly plants at Dehradun, Baddi, and Roorkee. ECB plant in Goa; Jewellery Plant at Dehradun Investment of US$150 million in a 450,000 sq.ft. state-of-the-art facility.

Owned by Tata: 25.17% and TIDCO: 27.88%. Professionally managed by TATA group & an independent Board Recognition and Awards in many categories The Watch Division won the coveted JRD QV (Malcolm Baldrige) Award in 2006 and its score was affirmed in 2007. Indias most admired consumer durables company having the most trusted brand -TITAN. Both TITAN and TANISHQ adjudged most admired brands for the last 4 years. Adjudged Retail Company of the year. Retail Asia and Media Award-Singapore, for Retailing and preferred brands. Selected as Asian Dynamo by BCG Ideator Awards for Titan designers. Best Corporate Citizen Mother Teresa, Helen Keller, Rotary and Chamber of Commerce Awards. President of India Award for best employer of the physically challenged.

Our Brands TITAN SONATA FASTRACK XYLYS TANISHQ GOLD PLUS TITAN EYE+Highlights Businesses Watch volume crosses 10M Jewellery turnover crosses Rs 2000 cr.Brands Brand GoldPlus crossed Rs 200 Crore mark Brand Sonata touched 5 million watches Brand Fastrack crossed 1 million watchesRetailing World of Titan stores crossed 225 Tanishq boutiques crossed 100International Watches launched in PakistanNew Businesses Gold Plus outlets reached 22 (from 10) Titan Eye+ outlets reached 10 (from 1)

THE THREE YEAR JOURNEYINCOME

CAPITAL EMPLOYED(The three year journey..)

COMPANY PROFITABILITY (The three year journey..)

Market Capitalisation (Rs. Cr.)

The Watch Market & Industry in India

India is an under-penetrated market for watches only 27 % of Indians own a watch Total estimated market as of 2007 Volume ~ 42 mn units & Value: Rs 2700 Crores (USD 675 Mn) Vast proportion of the Indian market is below Rs 500 ~ 68% (85% by volume) Market has been split into: Low end, Mass market, Premium,Luxury.

INTERNATIONAL BUSINESS

One of Indias first companies to market a consumer brand overseas. Now present in 26 countries outside India Among the top 3 brands in some Asian countries Selling 650k watches annually with increasing presence in jewellery. Total export sales of over Rs 130 crores in 2007-08 (up from Rs 115 crores in 2006-07).

Multiple Businesses, Brands and Geographies

Our market and brand leadership of >50% uses the muscle of a vast distribution network

Watch Market Map

OUR WATCH BUSINESS OVERVIEW

By 2009, More than a billion $ company

Demand forecastingWHAT IS FORECASTING:Forecasting is not a substitute for management judgment in decision making; it is simply an aid to that process. Managers who use forecasts in their work need to develop realistic expectations as to what forecasting can and cannot do. In simple words we can say that forecasting demand means prediction of future demand.

SUBJECTS OF FORECASTING:Business uses forecasting to obtain information about many subjects. In the final analysis, firms are interested in future sales and profits-the bottom line. But to get there, a large number of forecasts may be necessary. There are various categories of forecast:

1) Forecasts of gross domestic product-which describes the total production of goods and services in a country.2) Forecasts of the components of GDP-for example, consumption expenditure, producer durable equipment expenditure , and residential construction.3) Industry forecasts-for Global Foods, this would represent forecasts of sales of soft drinks, bottled water, and its other products.4) Forecasts of sales for a specific product-for instance, diet cola.

Demand Estimating and Demand Forecasting:There is a great deal of similarity between demand forecasting and demand estimating. The difference between the two lies largely in the ultimate purpose of the analysis. The demand estimating technique will be used by a manager interested in probing the effect on the demand (or quantity demanded) of a change in one or more of the independent variables. Thus, a pricing manager may want to know the impact on the sales of the companys club soda as a result of a price change, of a competitors price changes, or, for example, of a change in the companys advertising expenses. In contrast, forecasting puts less emphasis on explaining the specific causes of demand changes and more on obtaining information regarding future levels of sales activity, given the most likely assumptions about the independent variables.

PREREQUISITES OF A GOOD FORECASTCertain conditions should be met by any good forecast:

1) A forecast must be consistent with other parts of the business. For instance, a sales forecast of 10 percent growth must ensure there are sufficient manufacturing facilities and labor force to produce this increase.2) A forecast should be based on knowledge of the relevant past. However, when underlying conditions have changed significantly, past experiences may be of no help in making a forecast. Moreover, sometimes there is no past on which to rely. This is the case when we are dealing with a new product or technology. Under these circumstances, analysts judgments must be injected into the forecasting process. In some cases, forecasts based purely on the opinion of experts are used to formulate the forecast or scenario for the future.3) A forecast must consider the economic and political environment, as well as any potential changes.4) A forecast must be timely. An accurate forecast that is too late to be acted on may be worthless.

NEED OF FORECAST IN PRODUCTION/OPERATIONS MANAGEMENTIn any company, everyone has to recognize that the sales forecast is not exact but should be as accurate as you could reasonably expect for the business you are in and that, through measurement and correction of errors, the sales forecast accuracy is improving on a product by product basis. It is the job of the execution departments (planning, purchasing, and production) to be able to meet the sales forecast at given this expected level of accuracy. A company that would like to ship from stock will need to measure the accuracy by part number at the effective procurement lead time. The procurement lead time will be supplier's lead time for a distribution company or cumulative lead time for a manufacturing company taking into consideration any safety stock of material, intermediate products or sub-assemblies.

General STEPS in the Forecasting ProcessFollowing steps are involved:

1) Identify the General Need: First of all, it is required to identify the requirement of forecast. For example, in a manufacturing department it has been observed that there is discontented demand due to which they realized to expand the production. This situation is known as identification of general need. 2) Select the Period (Time Horizons) of Forecast.Once the identification is realized, it is required to select the estimate time. 3) Select the Indicators Relevant to Need At this step, as per the requirement, the one or more of the following indicators may be identified:

a) Present competitors and projected capacityb) Income levelsc) Economic developmentd) If the product is related to population then population projectione) Industry sales

4) Select the forecast model to be used For selecting the forecast model knowledge of various forecasting models is required, along with the situations in which these are applicable and how much are they reliable.5) Data Collection With the reference of indicators identified, data is collected from various appropriate sources. This data can also be taken from the past evaluation.6) Prepare ForecastUsing the collected data, apply the selected model and calculate the value of forecast.7) Evaluate The obtained forecast through any of the model should be evaluated in terms of confidence interval. Generally, all the forecast models have methods of calculating upper value and lower value in which the forecast is expected to stay behind within a certain level of possibility. Forecast can also be evaluated from logical point of view i.e. whether the obtained value is logically feasible or not.

Forecasting is the process by which companies ponder and prepare for the future. It involves predicting the future outcome of various business decisions. This includes the future of the business as a whole, the future of an existing or proposed product or product line, and the future of the industry in which the business operates.

Forecasting is used to answer some important questions:

1) How much profit will the business make?

2) How much demand will there be for a product or service?

3) How much will it cost to produce the product or offer the service?

4) How much money will the company need to borrow?

5) When and how will borrowed funds be repaid?

Forecast is an estimate of future values which is related to planning of specified indicators. Selecting appropriate methodology for projecting the past data into future depends on the type of past data, pattern of past data and time scope of forecast. This method for projecting the past into future is known as Forecasting Model.

Forecast>= Time taken for preparation of plan + Time taken to implement the plan

Forecasting is also important when it comes to developing new products or new product lines. Forecasting prevents the company from spending time and money developing manufacturing and marketing a product that will fail. Forecasting is a process of estimating future events on the basis of previous data. The previous data systematically collective in predetermined form to get the estimate of the future. Whereas Prediction is a process of estimating future events which are not based on previous data. It is usually based on subjective considerations. Financial Forecasting is also an important aspect, as it enables management to change operations at the right time in order to reap the greatest benefit.

FORECASTING TECHNIQUES:

There are different forecasting methods. One of the challenges facing a forecaster is choosing the right technique. The appropriate method depends on the subject matter to be forecast and on the forecaster. Factors that affect it are:

1) The item to be forecast.2) The interaction of the situation with the characteristics of available forecasting methods. The manager must judge the relation between value and cost. If a less expensive method can be used to achieve the desired results, it certainly should be.3) The amount of historical data available.4) The time allowed to prepare the forecast. Selection of a specific method may depend on the urgency of the situation.

FORECASTING TECHNIQUES can be categorized in many ways:

1) Expert Opinion2) Opinion polls and market research3) Surveys of spending plans4) Economic indicators5) Projections6) Econometric models

FORECASTING HORIZONS:

1) Short Term Forecasting (1-3 Months)2) Medium term Forecasting (12-18 months)3) Long term Forecasting (5-10 years)

Criteria Short Term Forecast Medium Forecast Long Term Forecast

TypicalDuration 1-3 Months 12-18 Months 5-10 Years

Nature of decision Purely TacticalTactical as well as strategic Purely Strategic

KeyConsiderations Random(Short term effects)Seasonal and Cyclical effectsLong term trends and business cycle.

Nature of data Mostly Quantitative Subjective and Quantitative Largely Subjective

Degree of uncertainty Low Significant High

Some examples Revising QuarterlyProduction plans Rescheduling supply of raw material Annual ProductionPlanning Capacity augmentation New Product introduction Facilities location decision New business development

Some of the methods can also be classified under below mentioned categories:

1) Qualitative Forecasting2) Quantitative Forecasting

Qualitative Forecasting is based on judgments of individuals or groups. The results of qualitative forecast may be in numerical form but generally are not based on a series of historical data.Quantitative forecasting, in contrast, generally uses significant amounts of prior data as a basis for prediction. Quantitative techniques can be nave or causal. Nave forecasting projects past data into the future without explaining future trends. Causal or Explanatory forecasting attempts to explain the functional relationship between the variable to be estimated and the variable that accounts for the changes. Both Qualitative and Quantitative techniques of forecasting are used frequently and the use of quantitative methods has been growing rapidly.

EXPERT OPINION:

Various types of techniques fit into the category of expert opinion.

1) Jury of Executive Opinion: Forecast is generated by a group of corporate executives assembled together. The members of the panel may represent different functions within the corporation (intra organizational) or different corporations (inter organizational).2) The Delphi Method: This method, developed by the Rand Corporation in the 1950s, is used primarily in predicting technological trends and changes. Delphi also uses a panel of experts. The process is carried out by a sequential series of written questions and answers. Although in the past such iterative procedure could have been quite time consuming, computers and e-mail have shortened the process significantly. The iterations are conducted until the range of answers is narrowed. Finally, a consensus is obtained.

OPINION POLLS & MARKET RESEARCH: Opinion polls can be very useful because they may identify changes in trends, which may escape detection when quantitative (both nave & explanatory) methods are used. Choice of the sample population is of utmost importance because the use of an unrepresentative sample may give completely misleading results. Further, the questions must be stated simply and clearly. Often a question is repeated in a somewhat different form so the replies can be cross checked.

Market research is closely related to opinion polling. Market Research will indicate not only why the consumer is or is not buying, but also who the consumer is, how he or she is using the product, and what characteristics the consumer thinks are most important in the purchasing decision.

SURVEYS OF SPENDING PLANS:The use of surveys of spending plans is quite similar to opinion polling and market research, and the methods of data collection are also quite alike. However, although opinion polling and market research usually deal with specific products and are often conducted by individual firms.

1) Consumer Intentions: Because consumer expenditure is the largest component of the gross domestic product, changes in consumer attitudes and their effect on subsequent spending are a crucial variable in the forecasts and plans made by businesses. Two-well known surveys are reviewed here:

a) Survey of Consumer, Survey Research Center, University of Michigan: This is probably the best known among the consumer surveys conducted. Initiated in 1946, it is conducted monthly. It contains questions regarding personal finances, general business conditions, and buying conditions. The answers to these questions are summarized into an overall index of consumer sentiment and a large number of indexes covering replies to the more detailed questions.b) Consumer Confidence Survey, The Conference Board : A questionnaire is mailed monthly to a nationwide sample of 5,000 households. Each month a different panel of households is selected. The resulting indexes are based on responses to questions regarding business conditions (current and 6 months hence), employment conditions (current and 6 months hence), and expectations regarding family income 6 months hence. The replies are then summarized monthly into three indexes: (i) The consumer Confidence Index (ii) The Present Situation Index and (iii) The Expectation Index. This survey has been published since 1967.

2) Inventories and Sales expectations : A monthly survey published by the National Association of Purchasing Agents is based on a large sample of purchasing executives.

ECONOMIC INDICATORS:

The barometric techniques of economic indicators is specifically designed to alert business to changes in economic conditions. The success of the indicator approach to forecasting depends on the ability to identify one or more historical economic series whose direction not only correlates with, but also precedes that of the series to be predicated. Such indicators are used widely in forecasting general economic activity . Any one indicator series may not be very reliable; however, a composite of leading indicators can be used to predict. Such a series should exhibit a slowing before overall economic activity turns down, and it should start to rise while the economy is still experiencing low activity. Forecasting on the basis of indicators has been practiced in an informal fashion for many years. It is said that Andrew Carnegie used to assess the future of steel demand by counting the number of chimneys emitting smoke in Pittsburgh. Another example contains, Much of the work of establishing economic indicators was done at the National Bureau of Economic Research, a private organization. Today, economic Indicators data are published monthly by The Conference Board in Business Cycle Indicators. These monthly data are reported in the press and are widely followed. There are three major series: Leading, Coincident, and Lagging indicators. As their names imply, the first tells us where we are going, the second where we are, and the third where we have been. Although the leading indicators series is probably the most important, the other two are also meaningful. The Coincident indicators identify peaks and troughs, and the lagging series confirms upturns and downturns in economic activity. Many individual series are tracked monthly in the Business Cycle Indicators, but only a limited number are used in the construction of the three major indexes. The leading indicators index contains ten series, and the coincident and lagging indicators are made up of four and seven components, respectively. Leading Indicators represent not present expenditures, but commitments indicating that economic activity will take placed in the future.

ECONOMIC INDICATORS:Leading indicators

1) Average weekly hours, manufacturing2) Average weekly initial claims for unemployment insurance3) Manufacturers new-orders, consumer goods and materials.4) Vendor performance, slower deliveries diffusion index5) Manufacturers new orders, non defense capital goods6) Building permits, new private housing units7) Stock prices, 500 common stocks8) Money supply, M29) Interest rate spread, 10-year Treasury bonds less federal funds10) Index of Consumer expectations

Coincident indicators 1) Employees on nonagricultural payrolls2) Personal income less transfer payments3) Industrial production4) Manufacturing and trade sales

Lagging indicators

1) Average duration of unemployment2) Inventories to sales ratio, manufacturing and trade3) Labor cost per unit of output, manufacturing4) Average prime rate5) Commercial and industrial loans6) Consumer installment credit outstanding to personal income ratio7) Consumer price index for services

BUSINESS CYCLE

The economy tends to grow and then contract alternatively. This is called a business cycle. An unpredictable long-term pattern of alternating periods of economic growth and decline; characterized by change in employment, industrial productivity, and interest rates is also called an economic cycle. It is periodic in nature but irregular, the up and down movements in economic activity, and is measured by fluctuations in real GDP and other macro economic variables. Business Cycle have a major impact on business and on employment as well as the national income of the country. It consist of four phases: (i) Contraction (ii) trough (iii) expansion (iv) peak. A recession occurs if a contraction is severe enough. A deep trough is called a slump or a depression.

CONSTANT COMPOUND GROWTH RATE

The constant compound growth rate technique is extremely simple and is widely used in business situations. When quick estimates of the future are needed, this method has some merit. The most rudimentary application of this method is to take the first and last years of past data, and to calculate the constant growth rate necessary to go from the amount in the first period to the amount in the last.

(1+i)n=E/BWhere E= Last years amount B= First years amount I= Growth rate N= Number of years

TIME SERIES ANALYSIS (TIME SERIES FORECASTING)

It has various advantages:

1) It is easy to calculate. A large number of software packages is available.2) It does not require much judgment or analytical skill by the analyst.3) It describes the line with the best possible fit, and provides information regarding statistical errors and statistical significance.4) It is usually reasonably reliable in the short run, unless an absolute turn in the series occurs.

The fact that time series analysis does not take into consideration causative factors does not mean that an analyst using this method should not consider additional information about changes in the underlying forces. Any analyst using this nave method of prediction should try to fine tune the conclusions based on information that could alter the results.

When data are collected over a number of periods in the past, they usually exhibit four different characteristics:

1) Trend: This is the direction of movement of the data over a relatively long period of time, either upward or downward.2) Cyclical Fluctuations: These are deviations from the trend due to general economic conditions. For instance, if one were to observe data for the GDP over time, a long run upward trend would be evident. Also evident in this series would be movement around that trend as the economy rises more quickly or less quickly.3) Seasonal Fluctuations: A pattern that repeats annually is characteristic of many products. Time series in which data are collected more frequently than annually (monthly , quarterly) can exhibit seasonal variations.4) Irregular: Departures from norm may be caused by special events or may just represent noise in the series. They occur randomly and thus cannot be predicted.

Thus time series can be mathematically represented as: Yt=f(Tt,Ct,St,Rt)

Where Yt= Actual value of the data in the time series at time t Tt= Trend component at t Ct= Cyclical component at t St= Seasonal component at t Rt= Random component at t

MOVING AVERAGE: The average of actual past results is used to forecast one period ahead. The equation for this construction is simply:

Et+1=(Xt+Xt-1+_Xt-N+1)/N

Where Et+1= Forecast for the next period (t+1) Xt, Xt-1= Actual values at their respective times N= Number of observations included in the average

SALES FORECASTING SURVEY:

An article published in 2005 presents the results of a survey that was conducted to discover whether forecasting practices have changed over the previous 20 years and whether forecasting results have improved. It compares its results to two similar surveys that were conducted in 1995 and 1984. Some of the major findings of this survey were as follows:1) The most familiar forecasting techniques were moving averages followed by exponential smoothing, regression and straight-line projection.

2) The familiarity smoothing appeared to be the most satisfactory method, followed by trend line analysis.

3) The satisfaction level with the various techniques appears to be declining from previous surveys.

4) Despite the great importance in tools such as software that are now available to forecasters, the overall degree of accuracy of the forecasts is substantially lower than that of the previous two studies.

5) Sales forecasting performance does not affect compensation of forecasting personnel.Judgmental Forecasting

Judgmental forecasting is the most common method of actual forecasting especially when the decision to be taken is critical or the required data is unreliable. They may use objective data or subjective impressions. Different methods of judgmental forecasting are as follows:

1) Personal interviews2) Traditional meeting3) Role playing4) Telephone interviews5) Mail questionnaires6) System dynamics7) Cross impact theory8) Delphi9) Structured meetings

THE DELPHI TECHNIQUE

The Delphi method is a systematic, interactive forecasting method which relies on a panel of experts. The experts answer questionnaires in two or more rounds. After each round, a facilitator provides an anonymous summary of the experts forecast from the previous round as well as the the reasons they provided for their judgments. Thus, experts are encouraged to revise their earlier answers in light of the replies of other members of their panel. It is believed that during this process the range of the answers will decrease and the group will converge towards the 'correct' answer. Delphi is based on the principle that forecast from a structured group of experts are more accurate than those from unstructured groups or individuals. The technique can be adapted for use in face-to-face meetings, and is then called mini-Delphi or Estimate-Talk-Estimate (ETE).

Opinion Capture Techniques

Based on structured accepted research methodology and survey techniques, most Hotels and Cruise Lines fail to capture the true opinion of their guests due to flawed questionnaires and surveys.

Nominal Group Technique

Steps involved in Nominal Group Process:

1) Silent idea generations2) Round-robin sharing of ideas3) Feedback to the group4) Explanatory group discussion5) Individual re-assessment6) Mathematical aggregation of revised judgmentsThe following Three Principles are involved in Nominal Group Process to make it a SUCCESS:

1) First, ideas should not be evaluated one at a time. Rather the facilitator should collect many ideas before any one of them are evaluated.2) Second, in estimating numbers, thinking again improves the accuracy of the numbers. A sort of bootstrapping occurs, where the group members best themselves by listening to other group members and revising their own opinions.3) Finally, individual generation of ideas leads to more ideas and more creative ones than generating ideas while listening to other group members.

FORECASTING BASED ON CROSS IMPACT ANALYSIS:

Technology forecasting dos not follow a fixed methodological pattern. However, the way in which the study is approached and the choice of methods depend on the individual researcher. Several versions of cross impact analysis have been developed by researchers. The evaluation of the technique has not followed a single path but has produced a variety of different methods for constructing, utilizing, and evaluating cross-impact matrices. In applying cross-impact analysis to a particular area, it is important to select for inclusion those developments (events and trends) whose expected impact on the future of that area is judged to be relatively greatest.The major steps in the use of cross impact Impact analysis for evaluating future situations are:1) Define the events and trends to be included in the analysis.

2) Define the planning interval and sub-intervals

3) Develop cross impact matrices to define the interdependencies between events and trends.

4) Estimate the entries in the cross impact matrix, i.e. information on how the occurrence of an event E, or how the deviation of a trend T from its expected value in a given scene would affect other event probabilities and trend values.

5) Estimate the initial occurrence probabilities of each event in each scene.

6) Estimate the value of each trend at the beginning of each scene.

7) Perform a calibration run

8) Define the policies, actions, or sensitivity tests to be run with the matrix

9) Perform the cross impact calculations

10) Evaluate results.

Forecasting through Moving Average Method: manufacturing company has monthly demand for one of its product as follows:

Now, calculating the estimated forecast for September month by moving average method:(520+490+550+580+600+420+510+610)/8= 535 unitsExamples of Moving Average Method used to forecast sales:

In case of titan we have a sales of titan year wise as followes:-

year Sales Rs. Million

1987168

1988275.9

1989740.6

19901062.6

19911550.1

19921912.1

19932262.3

19942803.4

19953514.4

19964096.6

19974433.8

19984836.1

19996322.3

20006990

20017276.9

20028005.4

20039611.2

200411508.9

200515099.1

200621816.9

200730981.9

200839260.9

200947986.5

201065708.6

201189708.7

201289708.7

201381708.0

So now according to moving average method we have taked last three years. (65708.6+89708.7+89708.7)/3 = in 2013 the sales forecast of company is 81708

REGRESSION ANALYSIS of Titan

Introduction. Regression analysis is used when two or more variables are thought to be systematically connected by a linear relationship. In simple regression, we have only two let us designate them x and y and we suppose that they are related by an expression of the form y = b0 + b1 x + e. Well leave aside for a moment the nature of the variable e and focus on the x - y relationship. y = b0 + b1 x is the equation of a straight line; b0 is the intercept (or constant) and b1 is the x coefficient, which represents the slope of the straight line the equation describes. To be concrete, suppose we are talking about the relation between air temperature and the drying time of paint. We know from experience that as x (temperature) increases, y (drying time) decreases, and we might suppose that the relationship is linear. But suppose that we need to know the exact nature of the relationship, so that we can predict drying time at various temperatures. How could we discover the actual values of b0 and b1? Well, to start with, we cannot discover the actual values. In short Regression analysis its a stastical tool with which we are able to estimate or predict the value of one variable(the dependent variable) from known value of the onther variable(it dependent variable).The regression equation of Y on x is express as :- Y = a+bxWhere Y = dependent variableX = independent variablea = alpha co-efficientb = beta co-efficient.

Representing this diagrammatically:-yY= a+bx

a bx

thus for a known value of X,Y can be calculated.

For Titan watches:

Titan Industries Ltd.

year Sales Rs. MillionProfit after tax Rs. MillionIncome Rs. Million

19871682.619

1988275.910.72.1

1989740.643.35.2

19901062.691.14.4

19911550.11114.3

19921912.1108.25.6

19932262.3190.910.1

19942803.4250.98.9

19953514.4275.814.8

19964096.6242.2148.8

19974433.8146.468.9

19984836.1170.6123.2

19996322.3192.8164.3

20006990234.8156.7

20017276.9130.977.4

20028005.462.1193.5

20039611.2111.988.9

200411508.9249.498.2

200515099.1736.262

200621816.9941.387.1

200730981.91502.7272.5

200839260.91589.6259.3

200947986.52503.2107.1

201065708.64304.2576.7

201189708.76001.6950.7

201289708.76001.6950.7

2013

In this case we know that profit is dependent on sales.Therefore we can take profit values on y-axis and sales on x-axis.

Onther regression of sales & year(Titan)year Sales Rs. Million

1987168

1988275.9

1989740.6

19901062.6

19911550.1

19921912.1

19932262.3

19942803.4

19953514.4

19964096.6

19974433.8

19984836.1

19996322.3

20006990

20017276.9

20028005.4

20039611.2

200411508.9

200515099.1

200621816.9

200730981.9

200839260.9

200947986.5

201065708.6

201189708.7

201289708.7

2013

Consumer Behaviour and Brand Preference of Titan WatchesI. Introduction:

Today human begins work with the time. The various activities to be performed on generally prescribed on the basis of time factor. Thus time is consider to be a fresher factor in every walk of life. Now-adays we find no person without a wrist watch and a home without a clock. Thus the watches have become almost a necessity for human begins, to whichever economic class they belong. In the 18th and 19th century watch industry has flourished in western world only, specificallySwitzerland but the second half of the 20th century has seen India emerging an important manufacturer of watches. Titan Industries a TATA group company as created history in the Indian watch industry by manufacturing and marketing different brands of watches not only in Indian market but also in the internationalmarket. This project work titled MARKETING OF TITAN WATCHES is a effort to study the market response to Titan brand of watches.

Objectives Of The Study:The following are the objectives of the study towards Marketing of Titan Watches in Haveri City.Tostudy consumer attitude towards Titan range of watches.1. To know the market share of Titan watches.2. To know the extend of satisfaction among Titan watch users.3. To find the extent of brand loyalty among consumers.4. To study the factor affecting the buyers behavior.5. To study consumer attitude towards price policies of titan watches study the consumer attitude towards companys promotional activities.6. To study buyer reaction to after sales service.7. To study the marketing strategy adopted in the dealers.8. To analyze statistically responded opinion.9. To determine consumer demographics.Scope Of The Study:1. Study covers the awareness of the consumer towards Titan watches.2. Study covers the market share of Titan watches.3. Study covers the reasons of buying the Titan watches.4. Study covers the consumer attitude towards the price of the Titan watches.5. Study covers the various marketing channels of Titan watches.6. Study covers the history of Titan watches industries.7. Study covers the various problems faced by the company and the dealer.8. Study is restricted to Haveri City only.

II. Research Methodology:In the study both primary and secondary data has been used for the purpose of collecting data.The primary data have been collected through the consumer survey and discussions were carried out with the consumer personally.The secondary data has been collected from various published literature (like text books, magazines, news papers) and internet. The information regarding the organization has been collected from report and record provided by the dealers of Titan watches.

Consumer survey:In order to collect the primary data the consumers survey was undertaken. The sample consumers were selected on stratified random sampling method. A structured question was used to collect information from the sample consumer contacted. Even personal interviews were held with the respondents to gather unbiased information. Observation method also made used to understand the real feelings of the respondents so that study become more realistic in nature.

Limitations:1. The study has been restricted to the users of Titan watches only.2. The data and opinion collected are assumed to be objective.3. The survey is restricted to 100 respondents.4. Lack of consumer awareness about different watches.5. Time constraint.6. The sample size is supposed to representative of the views of the consumers.7. The study has been restricted to Haveri city only.

III. Survey AnalysisIntroduction:Consumer survey is necessary in any form of marketing research because consumer is the king in the market and his behavior changes day by day. Selection of products by the consumer reflects the faith in the products. The buyers behavior changes according to their age, income, sex and other factors. Buyers purchasing always depends on the quality and price. The study of consumer satisfaction is necessary to know the opinion of different consumers to implement the most effective marketing policy of the firm.To conduct the consumer survey, questionnaire method was used. Questionnaire is the most common research instrument. A questionnaire is a set of questions with or without space for recording answer. The question can secure relevant facts or opinions from informed and interested respondents included in the sample survey. In the following subsequent section, the data obtained from the respondent are analyzed statistically. A convenient sampling technique was made use for this survey and the number of respondents chosen was 100.

Demographic Analysis:The demographic factors pertaining to consumers are mainly age, education, occupation and income.

Table-1: Showing Gender Wise Classification Of Respondents

GENDERNo. of respondentsPercentage

MALE8080

Female2020

TOTAL100100

As per the table, of the respondents 80% are male and 20% are female.

Table 2: Showing Classifiction Of Respondents On The Basis Of Age Group

Age group (in years)No. of respondentsPercentage

10-2020 20

20-3060 60

30-4010 10

Above 4040 10

Total100

100

The above table indicates that majority of the respondents (60%) belongs to the age group of 20 to 30 years, 20% belong to age group of 10 to 20 years and 10% each belongs to the age groups of 30 to 40 years and above 40 years.

Table-3: Showing Classification Of Respondents Based On OccupationOccupationNo.of respondentsPercentage

Student6060

Businessmen / Professional1818

Government employee88

Others14 14

Total100 100

The above table reveals the occupation of the respondents. Out of the total respondent 60% are student, 18% are businessmen/ professionals, 8% are government employees and remaining 14% are other (like housewives,retired people etc.)

Table-4: Classification Of Respondents On The Basis Of Monhtly Income Of FamilyMonthly income (in Rs)No.of respondents Percentage

Below50004040

5000 100001414

10000 150003636

Above 150001010

Total100100

This table classifies the respondents based on monthly income. Of the respondents 40% belong to the income group of below Rs. 5000, 36% to the income group of Rs. 10000 to Rs. 15000, 14% to the income group of Rs.5000 to Rs. 10000 and 10% to above Rs. 15000 group.

Table 5: Classification Of Respondents Based On QualificationQualificationNo. of respondentsPercentage

S.S.L.C.1010

Graduate6060

Post-graduate44

Others2626

Total 100100

From the above table it can be seen that of the respondents, 10% have studied up to S.S.L.C., 60% are graduates, 4% are post graduate and remaining 26% are others (like P.U.C., Engineering)

Table 6: Showing Classification Of Respondnets On The Brand Of Watches OwnedBrand of watchNo. of respondents Percentage

Titan4040

Timex2424

Sonata1616

Fastrack66

Others1414

Total 100100

The table shows that 40% of respondents owned Titan brand watches, 24% Timex brand of watches, 16% Sonata brand of watches, 6% Fast track brand of watches and remaining 14% owned other brand like HMT, Citizen, and Maxima etc.

Table 7: Classification Of Respondnets Based On The Source Of Information About Titan WatchesSource of informationNo. of respondents Percentage

Advertisement14 35

Relatives14 35

Friends12 30

Total40 100%

The above table indicates the sources of information about Titan watches. Of the 40 respondents, 35% each came to know about the Titan brand of watches through advertisement and relatives and 30% through their friends.

CHART SHOWING SOURCE OF INFORMATIONThe above table indicates the sources of information about Titan watches. Of the 40 respondents, 35% each came to know about the Titan brand of watches through advertisement and relatives and 30% through their friends.

Table8-: Classification Of Respondents On The Basis Of Plan To Change WatchPeriod (in years) No.of respondents Percentage

Less than year 20 20

1 to 3 34 34

3 to 5 28 28

Above 5 years 18 18

Total 100 100

. PERIOD IN YEARS

As per the above table, 34% of the respondents wants to change the watch in a period of 3 years, 28% in 3 to 5 years, 20% in less than a year and 18% after 5 years.

Table-9: Showing The Table Of Respondent On The Basis Of Opinion Abou The Performance Of Titan WatchOpinionNo. of respondentsPercentage

Excellent1435

Good1640

Satisfied615

Unsatisfied410

Total40100

CHART SHOWING OPINION ABOUT THE PERFORMANCE OF TITAN WATCH

The above table indicates the opinion of the respondents regarding the performance of titan watches. Of the 40 respondents, 35% consider the performance as excellent, 40% as good, 15% as satisfied and remaining 10% are not satisfied with the performance of titan watches.

Respondents Regarding After Sales Service Of The CompanyOf the respondents 90% of the satisfied of the after sales service of the dealer and remaining 10% feel dis-satisfied with the after sales service of the dealer.

Major Survey Findings:1. Majority of the respondents are male.2. Most of the respondents belong to the age group of 20-30 years.3. Most of the respondent belongs to the occupation of student.4. Majority of the respondents monthly income were below Rs.5000.5. Most of the respondents belong to the qualification of graduates.6. The majority of respondents owned titan brand watches.7. The majority of respondents are come to know about the titan brand watches through advertisement and relatives.8. Most of the respondents belong to the plan to change watch in a period of 3 years.9. Most of the respondents belong to the wish price range of Rs.500-1500.10. The majority of respondents feel that the price of the titan watches as high. 11. Most of the respondents belongs to the mode of owning watch are bought.12. The majority of respondents are occasion of watch gift from birthday.13. The majority of respondents are occasion of watch bought from birthday.14. Most of respondents belong to the opinion about the performance of titan watch as good.15. Majority of respondents feel satisfied about the after sales service.

IV. Suggestions And ConclusionSuggestions:The survey of consumers has revealed the like and dislikes and taste regarding wrist watches andsatisfaction level in relation to Titan industries Ltd. The consumers have forwarded the following suggestionsfor the consideration of the company and dealers.1. The respondents feel that the price of Titan watches is too high. They anticipate a reduction in the price,which can be affordable to all common class of people.2. The service for the new watches should be improved.3. One service mechanic must be provided by the company at every showroom to ensure consumers goodservice and advice.4. Some respondents feel that the price of spares of Titan watches is high and suggest for a reduction in prices.5. Some more attractive festival offers and gifts should be given on purchases.6. All varieties of watches should be made available in show room, which cater to the taste of different incomegroup customers.7. Quality of the leather straps (belt) of watches should be improved.8. Advertisements in local media should be increased. This may cover rural areas also.9. Guarantees should be given for costly interior parts of watch.10. Some respondents suggested that Titan industries Ltd., should manufacture separate kids and sportswatches.11. The dealer has to improve after sales service to satisfy the customers.

Conclusion:The Titan brand of watches coming from the Titan industries is known for quality and performance in the domestic and international markets. The consumer of Titan brand watches are highly satisfied customers having pride in owning and wearing the most sophisticated, highly reliable and superior performance watch.Titan brand watches are in great demand not only in India but also abroad. It is owing to a fact that they come from a Tata group company.The turnover of titan brand of watches has shown uptrend from year to year. Titan watches enjoy a lions share in the domestic watch market.Though, there, is increasing demand for all varieties of Titan a watch, a few suggestions given by the respondents is to be considered by Titan industries. The company has to put its efforts in improving quality of its watches, introduce new varieties with changing out look to appeal and attract potential customers for its products. Again the company can also consider for a reduction in the prices which may make it market leader in the years to come.Finally it can be said that the performance of Titan watches is not only amazing but also highlysatisfactory. The company can achieve further success by improvement the suggestions of the consumers.

PRODUCTION ANALYSIS

INTRODUDCTIONProduction implies provision of goods and services, often described as services. Production is an important economic activity. It directly or indirectly satisfies the wants and needs of the people. Satisfaction of human wants is the objective of production.

MEANING OF PRODUCTIONProduction is the conversion of input into output. The factors of production and all other things which the producer buys to carry out production are called input. The goods and services produced are known as output. Thus production is the activity that creates or adds utility and value. In the words of Fraser, "If consuming means extracting utility from matter, producing means creating utility into matter". According to Edwood Buffa, Production is a process by which goods and services are created".

FACTORS OF PRODUCTIONAs already stated, production is a process of transformation of factors of production (input) into goods and services (output). The factors of production may be defined as resources which help the firms to produce goods or services. In other words, the resources required to produce a given product are called factors of production. Production is done by combining the various factors of production. Land, labor, capital and organization (or entrepreneurship) are the factors of production (according to Marshall). We can use the word CELL to help us remember the four factors of production: C. capital; Entrepreneurship; L land: and L labor.

PRODUCTION FUNCTIONProduction is the process by which inputs are transformed in to outputs. Thus there is relation between input and output. The functional relationship between input and output is known as production function. The production function states the maximum quantity of output which can be produced from any selected combination of inputs. In other words, it states the minimum quantities of input that are necessary to produce a given quantity of output.The production function is largely determined by the level of technology. The production function varies with the changes in technology. Whenever technology improves, a new production function comes into existence. Therefore, in the modern times the output depends not only on traditional factors of production but also on the level of technology.

The production function can be expressed in an equation in which the output is the dependent variable and inputs are the independent variables. The equation is expressed as follows:Q= f (L, K, Tn)Where, Q = outputL = laborK = capitalT = level of technologyn = other inputs employed in production.

There are two types of production function - short run production function and long run production function. In the short run production function the quantity of only one input varies while all other inputs remain constant. In the long run production function all inputs are variable.The production function of TITAN can be calculated by using various factors like output, labour cost, capital. So now we will calculate by using these factors.

Output- It is the Net sales of the TITAN.

Labor Cost: - It is the total compensation that is paid to the employees of the Titan.

Capital Cost: - It is the cost of shared capital of Titan.

The table is been given below:-yearsaleslabor costcapital cost

20006322.3652.64099.3

20016990673.44220.1

20027276.9690.14433

20038005.4651.34670.8

20049611.2772.74070.1

200511508.9890.83181.9

200615099.11018.62679.3

200721816.91450.22470.2

200830981.91950.52574.9

200939260.92670.21754

201047986.53500.5728

201165708.64190.8677

201289708.75215.5113.1

2013102063.78400.860.3

The graphs for the various heads of labor, capital and total income are shown as below.After we are done with the graphs, we would find the:1.) Output as a function of labour and capital.2.) Output as a function of labour only (capital being considered constant).

Sales in millions (Rs..)

1.) Output as a function of labor and capital using the function:Sales, O = f (L, K)L= Labor cost K= Capital cost.or O = A* L^ * K^To obtain the values of alpha and beta we have to use the regression analysis. To do so we take log on both the sides.Ln (O) = Ln (L) + Ln (K) + Ln (A).The various values for the logarithms are given as below:yearsaleslabor costcapital costLn(sales)Ln(labor cost)Ln(capital cost)

20006322652.64099.38.7517908936.4809643848.318571506

20016990673.44220.18.8522358356.5123395078.347614103

20027276.9690.144338.8924602266.5368365158.396831835

20038005.4651.34670.88.9878715936.4789703668.449085642

20049611.2772.74070.19.1706843646.6498908758.311422848

200511508.9890.83181.99.3508759286.7921199358.065233782

200615099.11018.62679.39.6223904186.9261844147.893310845

200721816.91450.22470.29.9904401787.2794567577.812054398

200830981.91950.52574.910.341158447.5758410297.853565977

200939260.92670.2175410.577984397.8899086557.469654173

201047986.53500.572810.7786758.1606610946.590301048

201165708.64190.867711.092985098.3406469256.517671273

201289708.75215.5113.111.404323038.559390244.728272383

2013102063.78400.860.311.533352419.0360822184.099332104

Then we use regression analysis to calculate the values thereof.Ln(A)= -0.39465854 = 1.287155574 = 0.116799396Now, Ln(O) = -0.39465854+1.287155574 Ln(L) + 0.116799396 Ln(K)

Ln(A) = -0.39465854 A = 0.673910113+And 1.287155574+0.116799396 =1.403955 + = >1Now we have following observations for the value (+ ).1. If (+ ) = 1, the production function exhibits constant returns to scale, increasing both inputs by a factor A raises output by exactly the same factor. It is linearly homogeneous.

2. If (+ ) > 1, the production function exhibits increasing returns to scale.

3. If (+ ) < 1, the production function exhibits decreasing returns to scale.

ANALYSIS :The value of (+ ) is more than 1, so the net sale comes out to be increasing function of labor & capital. Increasing returns to scale means a proportionate increase in all inputs leads to a more than proportional increase the output. In this case doubling all inputs would lead to more than a doubling of output. In this case, + = 1.403955 indicates a 100 % increase in (or doubling of) the inputs leads to a 140.39 % increase in the output level.

2.) Output as a function of labour only using the function:Sales, O = f (L)L= labor cost Now, We define O = A* L^ To obtain the values of alpha and beta we have to use the regression analysis. To do so we take log on both the sides. Ln (O) = Ln (L) + Ln (A).The various values for the logarithms are given. Then we use regression analysis to calculate the values thereof.

yearsaleslabor costLn(sales)Ln(labor cost)

20006322.3652.67.6009028.751838

20016990673.47.6014028.852236

20027276.9690.17.6019028.89246

20038005.4651.37.6024018.987872

20049611.2772.77.60299.170684

200511508.9890.87.6033999.350876

200615099.11018.67.6038989.62239

200721816.91450.27.6043969.99044

200830981.91950.57.60489410.34116

200939260.92670.27.60539210.57798

201047986.53500.57.6058910.77868

201165708.64190.87.60638711.09299

201289708.75215.57.60688511.40432

2013102063.78400.87.60738111.53335

Then we use regression analysis to calculate the values..

Ln A = 1.714412317 = 1.117479612Ln(O) = 1.117479612 Ln(L)+ 1.714412317Now we get..Ln( A) = 1.714412317 A = 1.714412317A = 5.553410908Thus, the estimated equation in its multiplicative form is: O = 5.553410908L1.1175And = 1.117479612

Now we have following observations for the value ().1. If () = 1, the production function exhibits constant returns to scale, increasing both inputs by a factor A raises output by exactly the same factor. It is linearly homogeneous. 2. If () > 1, the production function exhibits increasing returns to scale. 3. If () < 1, the production function exhibits decreasing returns to scale.4. ANLAYSIS: The value of is Greater then 1 so the net sales comes out to be increasing function of labor. It shows a given percentage change in labor would generate a Greater percentage change in output. The term elastic is used to describe the responsiveness of output to labor input in this case. In this increasing the labor would lead to increase the output at more then 110 %. In this case, = 1.117479612 which indicates more then 100 % increase in the output.Average product of labor, APL = Sales/ labor costMarginal product of labor, MPL = * (sales/ labor cost)

AVERAGE PRODUCT & MARGINAL PRODUCT:Average product =

Marginal product = Therefore, Average product of labor (APL) = Marginal product of labor (MPL) = = * APLSimilarly Average product of capital (APC) = and Marginal product of capital (MPC) = = * APCThe values of APC & MPC is calculated and plotted for different fiscal years as follows:

yearsaleslabor costAVERAGE PRODUCT OF LABOR (APL)MARGINAL PRODUCT OF LABOR (MPL)

20006322652.69.68740422916.60820513

20016990673.410.3801603817.7958748

20027276.9690.110.5447036718.07796984

20038005.4651.312.2914171721.07255698

20049611.2772.712.4384625321.32465337

200511508.9890.812.9197350722.14975293

200615099.11018.614.8233850425.41339388

200721816.91450.215.0440628925.79172671

200830981.91950.515.88408127.23186411

200939260.92670.214.7033555525.20761386

201047986.53500.513.7084702223.50197018

201165708.64190.815.6792497926.88069895

201289708.75215.517.2004026529.48858215

2013102063.78400.812.149283420.8288811

COST ANALYSISWe will now do cost analysis for State Bank Of India. We have collected data for the expenses and income statements of the bank for the previous six years. The expenses have been divided on various bases such as rent and lease rent insurance premium paid treasury operations expenses compensation to employees interest paid provisions and contingenciesThe income has been divided on various bases such as Income from financial services Interest Dividends Treasury operations Other Income Prior period income and extraordinary incomeAlthough there are other bases also but these are the most important of them of all. Also some of the bases have zero figures , so we have selected some of them for doing our cost analysis.YearsSalesSelling and Admin ExpensesPercentage

2004958.9200

20051134.66157.340.13866709

20061481.37193.80.13082484

20072136.46262.360.12280127

20083041.09301.60.09917497

20093848157.340.04088877

20104703193.80.04120774

20116571262.360.03992695

20128970.86301.60.03361997

201310206.4385.720.03779212

Sales vs Other manufacturing Expenses

YearsSalesOther Manufacturing ExpensesPercentage

2004958.9200

20051134.663.670.003234449

20061481.373.670.002477436

20072136.465.770.002700729

20083041.096.250.002055184

200938483.670.000953742

201047033.670.000780353

201165715.770.000878101

20128970.866.250.0006967

201310206.369.210.000902379

Sales VS miscellaneous Expense:YearsSalesMiscellaneous ExpensesPercentage

2004958.92146.750.15303675

20051134.6633.030.029110042

20061481.3752.330.035325408

20072136.4662.010.029024648

20083041.09109.290.035937772

2009384833.030.00858368

2010470352.330.01112694

2011657162.010.00943692

20128970.86109.290.012182778

201310206.490.590.008875838

YearsSalesEmployee CostPercentage

2004958.9294.780.09884036

20051134.6696.60.08513564

20061481.37111.950.07557194

20072136.46159.990.07488556

20083041.09193.360.06358247

2009384896.60.02510395

20104703111.950.02380395

20116571159.990.02434789

20128970.86193.360.02155423

201310206.4237.250.02324531

Sales Vs Employee cost

YearsSalesPower and fuel costPercentage

2004958.928.90.00928127

20051134.6610.050.00885728

20061481.3710.260.00692602

20072136.4611.810.00552784

20083041.0914.180.0046628

2009384810.050.00261175

2010470310.260.00218159

2011657111.810.00179729

20128970.8614.180.00158067

201310206.416.390.00160586

Sales Vs Power and Fuel cost:

Sales vs. Raw Materials

YearsSalesRaw materialsPercentage

2004958.92593.760.619196596

20051134.66748.860.659986251

20061481.37975.540.658539055

20072136.461,616.030.756405456

20083041.092,426.590.797934293

200938482,936.020.76299896

201047033,558.070.756553264

201165715,302.380.806936539

20128970.867,371.950.821766252

201310206.48,387.020.821744481

MARKET STRUCTURE

Market is defined as the institutional relationship between buyers and sellers ; it refers to the interaction between buyers and seller of a god at a mutually agreed upon price. Market structure is best defined as the organizational and other characteristics of a market. There are different parameters on which markets may be characterised:-I. Nature of Competition:- This refers to the number , size and distribution of seller in an market . There can be a market in which a very large number of seller exist and size of an individual seller is very small , whereas there can be another market with only one very large player , without and competitor.

II. Nature of Product:- This refers to whether the product is homogeneous or differentiated . The market we face may have sellers producing the same products which are almost identical. Then there can be a market with large number of sellers selling similar yet somewhat different products like cosmetic.

III. Number and size of buyers:-We know that any market has two players , a buyer and a seller . As we can categorise markets on the basis of number and size of sellers, so also can be done on the basis of number and size of buyers. IV. Freedom to enter into or exit from the Market:-Some markets may be very difficult to enter , there may be financial restriction , legal compulsions and technological constraints on entry . At teh other extreme , entering a market may be very easy , without any such restriction .

Now based on all the above parameters we can characterise the market in the following :- PERFECT COMPETITION:- Features of Perfect Competition Presence of Large number of Buyers and Sellers Homogeneous Product Freedom of Entry and Exit Perfect Knowledge Perfectly elastic Demand Curve Perfect Mobility of Factors of Production No Government Intervention Firm is Price Taker

MONOPOLY:- A monopoly is a market in which a single seller sells a product of service which has no substitute.Features of Monopoly Single Seller Single Product No Difference between Firm and Industry Independent Decision Making Restricted Entry

MONOPOLISTIC COMPETITION:- Monopolistic competition is a market situation in which a relatively large number of producers offer similar but not identical procuts.Features of Monopolistic Competition Large Number of Buyers and Sellers Heterogeneous Products Selling Costs Independent Decision Making Imperfect Knowledge Unrestricted Entry and Exit

OLIGOPOLY:- Oligopoly is a market where a few dominant sellers sell differentiated or homogenous products under continuous consciousness of rivals actions.

Features of Oligopoly Few Sellers Products may be differentiated or homogeneous Entry Barriers Interdependent Decision Making Non Price Competition Indeterminate Demand Curve

Strength:

Style: Titan first introduced the style concept in India and projected the watch as a fashion accessory. Now adays style is avery much evidentfactor among theyouth. And there is a craze for stylish wristwatch. So, Titan makes the peoples life more glorious by making stylish wristwatch.

Models: As Titan offers the best and the biggest range to customer to choose the watchof their choice with an affordable price.It offers about 14 different names with about 1000plus different varieties with a watch forliterally everyone.

Exclusive products: Today Titan holds the pride for say that its products both within thecountry and internationally running in battle position. Its EDGE the slimmest watch inthe world position.Other than these there have few more strength like-

Contribution of owned brands and retail. The profit is accounted by being in theretail space which is booming.

Watchesareavailablewithpopularfunctionslikedates,multifunction& chronographic.

Guarantee/warranty

weakness

Pricing: the average price of Titan in mid-price segment is very high than the othercompetitor. Average price for Titan is Rs.1100 while the price for HMT is Rs.550. In the mid-price segment the company is not performing up to the mark due to the lack ofchoice of consumers.

Marketshare: As the average price of Titan wristwatch is far more than the othercompetitor, Titan has less market share. The market is more demonstrate by middle classpeople and for them Titan is quite costly. Among 75% market share in mid-segment.Titan market share is between 18-20% which is far lower than HMT and Maxima.

Globalized: As the company is Indian based which leads it to the strength, where as it isthe weakness also because the company not sufficiently globalized.

Opportunities

Seasonality: Atthetimeoffestival,likeDiwali.TitanpromotesNebula,Bandhanbecause there is demand for the products.- Gold watches and pairs are thelike as a wedding occasion.-The fast track brand is promoted in month of June-August when schools and colleges re-open.

Gifting concept:Titan started as a brand which was associated with gifting and relation .The fight concept sells well for people have come to associate Titan with love care and makes emotion run high.

Exchangingoffer:The Titan stores offer exchange offer of any old watch, of any make ,in any condition functional or otherwise and receive a flat discount of 25% on theirpurchase of abrand new, stylish and technologically advancedwatch from Titan.

Threats

Competitor:As we know that lots of Foreign brands are entering in our country withtheir branded watches. As the removal of quantitative restrictions on import watches leads tothreat to titan.

Premiumsegment:As in premium segment Titan is getting threats from reputedinternational brand such as Espirit, Swatch and Citizen.

Mobile:Now a days people can get the time and the other feature in mobile phone. So,the need of wristwatch is in decreasing trend. People can talk and see the time in a cell phoneand some people think thatthere is no need of wristwatch.

Marketing Objectives:Titan industries in watch holds 70% in Domestic level and 60% in Share inorganizedsectormarket.Companies the marketing objectives is to increase in market share by 5% .Before implementing the of marketing strategies we must have to focus on certain things ,whichinclude the BCG Matrix representation.Titan industries has registered an Income of Rs.1,104.85 crore as compared to previous yearwhich was Rs 7,25.11. In all the income the Titan industry had contributed Rs.3,03.45 crore.

BCG matrix helps us to understand the watches playing a important role for Titan industries here we are considering the different segment according to its performance as well as market share.

The titan- wwf collection is inspired from six species namely the Tiger, Indian RahinoGnageticriver Dolphin ,Red Panda ,Whaleshark and Oliver Ridley Turtle.Earlier they had launched Heritage collection about a year back based on beautiful monument ofIndia including The Taj-Mahal, LakshmiVials Place, Jharokha, Konark ,Ajanta. As it is the newcollection it requires more investment for Tiatn-wwf as the market growth is also high there.It include the watches namely REGALIA, EDGE andNEBULA.

Cash Cow:It basically include the watches Fast Track, Exacta, pectra for the titan. As in this segment thesewatches are playing important roleso it requirecertain amount of money which will help it outto sustain into themarket as well helpin liquidity.

Marketing Mix:PRICEPRODUCTPROMOTIONPLACE

Price:As achieve our marketing our marketing objectives, we can do some change in the pricing .The main consideration will be in changing price are followings

Survival:In case of some of thewatches titan prices them according to thefeatures .The Exacta is a simplesteel watch priced at Rs.600-1,100. As the company also deals with Spectra, Raga throughpricing policy.

B. Market share:As we know that 70% of sales in watches come from the lower segment, therefore by pricingSonata at 350 onwards with guarantee.Titan prices its world watches which compared equal to an international players like CalvinKlien where a customer pays 4 times as value of the world watch, therefore market with lowprices to international players to gain market share.C. Market Skimming:In Indian watch industry there is no one offering pure gold watches,watches in pair, jewellery watches. Here Titan offers there product with the Indian touch in itsdesign, the product, the love.Product:Quality and leadership are the two main terms for the Titan. As to achieve the marketingobjectives this aspects should also be considered.A. Product line:To increase the sales, the difference in the prices of the watches are justified bythe features.B. Product pyramid:Portfolio of Titans product is of3 distinct price-range thatcan be definedin general, as Popular, Mid, and Premium. At the popular segment, the emphasis is on involumes but not in margins. At the premium segment, the emphasis is on profits and image butnot in volumes. Obviously, company giving more emphasis at thetop of the pyramid as profits atthe top of the pyramid is very high. This pyramid guidedthe strategy of Titan.C. Product strategy:Titan was first focused only on the premium segment of the watch market.As per the product strategy they took, Titan moved in to the mass market for watches. To widenbase, Titan created new segments and increasinglyfocusing on segments individually. In the pastfew years Titan has took a lot of initiatives to focused on specific segments.

Promotion:

Promotional pricing:

A. Marketing pricing:As by opening new shops such as the world of Titan buy directly from the dealer and hence theelement of middleman is not there Here the retailer in this category buys watches for 17-18% lesser than MRP and hence they areable to get the 17% profit margin on sales .It is managing to successfully convince to the customer of the perceived value of WORLDWATCHusinghoardingallaroundthecity,increasingbuyerimage,trustworthiness,innovation, differentiation, value for the product.Price discount andallowances:Every year Titan comes with a price discount sale on the MRP of the watches. The allowances varies from onesegment to another.

B. Creative advertising:Titan introduces a contest on cartoon network in india.comwhich invites children to use creativity and design watch.The prize winning design was launched as a new watch in summer 2002 collection .Type of advertising:Titan believes in making its ads clean, well made, touch on emotionalchord. As the company is using celebrities or superstars that is Amir Khan for the Titan watches.As here we can say that a female actress would be more effective for the promotional purpose. Itcan be Katrina Kaif, asnow she is one of the popularactress inBollywood.

C. Promotion on occasion:

Titan is one of the company which formally believes in thepolicy of promotion the product basedon the occasions

Conduct

BOARD OF DIRECTORS Hans Raj Verma, (Chairman) (from 31.10.2012) N.S. Palaniappan, (from 30.01.2013) T.K. Arun, (from 31.07.2012) Bhaskar Bhat, (Managing Director) Ishaat Hussain N.N. Tata T.K. Balaji C.G. Krishnadas Nair Vinita Bali Hema Ravichandar Das Narayandas Ireena Vittal, (from 30.01.2013)

Our Mission and Vision

Titan Group aspires to be an admired company in the region, which delivers high values to the stakeholders through the deployment of the best available technology combined with strategic marketing and management practice. In the wholehearted effort to make that dream a reality, we firstly pursue trusted customer relationship by creating and adding value to customers by the deployment of solutions that conform to the best management practices. Equally important is how we can develop high return business portfolio through continuous expansion in strategic and profitable investments. All ventures that we enter into should maximize Titan's business value and, in return, sustain our growth.

Philosophy of the Company

Our beliefs and values drive behaviors and enable achievement of our mission.Our Group of companies is committed to major "shared" values: Acting in accordance with our beliefs and values will keep us on the right course, and will continually increase the strength of our company. INTEGRITY, Operating with integrity is one of our most fundamental group philosophies. We are committed to conduct all aspects of our practice with integrity. Integrity is at the heart or our relationships. Each of us is accountable for doing the right thing, which includes internal operations as well as external interaction with customers, vendors and business partners. We maintain the highest standards of professional and ethical practices. We are relentless in uncovering and sharing the truth and being honest with ourselves, our co-workers, stakeholders and the community at large. TRUST (and RESPECT), We strive to display honesty, dignity, and respect to our members, business partners, clients, and vendors by trusting, respecting and empowering our employees, and operating every single day with authenticity, openness and reliability. We thoughtfully consider other's ideas and viewpoints, and recognize our differences. We thrive under high standards, prospering when an individual grows and meets new challenges. OPENNESS, We believe that to an open and effective communication channel is the key to understand each other to make Titan a better company. We pursue and value each other perspectives, and desire to learn about opinions and decisions different from our own. Via an open communication, internally and externally, we encourage fresh ways to address business issues to make the group moves toward its goal. FUN, Together with hard work and high spirit, we want all Groups members and those people with whom we interact to have fun in their work. Our Group's goal is to create fun workplace in order to create an enjoyable working environment. At Titan we recognize that in almost every action we are part of a team, and through our collaborative efforts we align the workforce.

Brand PositioningSince its introduction, Titan has been positioned as a premium brand, providing highquality products. With its numerous sub-brands catering to different segments, the challengethat Titan faces is to create a strong brand image. It follows different positioning strategies,these strategies can also be analysed as given below:

Attribute Positioning: When the company launched its products, it was the first to bring quartz watches to the Indian market. The company successfully leveraged this to penetrate the market and gain a market share. Raga, Classique and Regalia come under this strategy. Classique has been positioned as elegant corporate wear that leaves a quiet, but definite impression and fusion of function and sophistication. Power dressing now has a new weapon! As Magic in gold and bicolour look, the 'Regalia' range represents the essence of dress-wear. Raga has been differentiated and positioned as exclusive watches for women. The Raga and Silver Raga collection is elegant, delicate and feminine with each piece being truly unique.

User Positioning: Titan caters to several user groups- children (the Dash), sportspersons and adventurers (PSI4000 and Fastrack range). The Fastrack range is seen as being contemporary, sturdy and reliable. The advertising, packaging and merchandising of this range is young, vibrant and cool (the ad line says Cool watches by Titan).

Competitor Positioning: With the entry of several foreign watchmakers into the market, Titan had to counter the threat. Most of the entrants are catering to the upper end of the market- Omega, Tissot, and Cartier etc. Titan already had the Tanishq brand in this segment. However, it has tried to reposition this brand by increasing the price range to encourage more customers.Price Positioning: In the overseas market, especially in Europe where it is competing with Swiss and Japanese watches, it is positioning itself as value- for- money: reasonably priced (less than Swiss watches and higher than Japanese), attractively styled and of good quality. In Indian market, Sonata is a perfect example of Price positioning, titan came up with this segment when it was facing heavy competition from lower end segment.

Market SegmentationMens segment:

With Titan positioning its range of watches as a life-style, the Indian market started viewing watch more as a complement to dress than just a time showing machine. They are also realising that, unlike other forms of art that are meant to be admired, high-end jewellery watches have that added bonus: practical luxury with a function other than beauty. Watches have joined the list of tie, deodorant and shoes to represent the occasion and flaunt your status.

Nebula Marketed as the Jewellery collection from Titan, Nebula is targeted towards affluent men who consider wearing gold jewellery a symbol of status. Magical blend of most coveted of metals, Gold and craftsmanship; Nebula is more of a connoisseur watch with the lowest price model at Rs.5500. It is marketed as a watch for discerning individual positioned as a gold jewel.Regalia: Incredibly eye-catching. magic in gold.

The watch uses the unique combination of gold and bicolour looks representing theessence of dress-wear. In India, gold-look is associated with status but at the same time, thesilver-look is the fashion of the day in international watches. With the combination of both,this watch is targeted towards affluent businessmen. The elegant looks and colours make it astrong competitor to the foreign brands like the Tissot, Piaget and Rado.This is also marketed as a watch for gift Special Watch for special occasion, positioning this as a costly gift.

Insignia:The World Watch from Titan.The watch with fascinating designs and precision engineering was targeted towardsthe European markets. The complexity of this watch is 10 times more than a regular titanwatch. Though it didnt meet with much of a success in Europe, this tag line and keyword International are used to position this watch as a world-class watch for international traveller with European tastes.

Classique: Power dressing now has a new weapon! Timeless elegance captured on the wrist.Classique' is marketed as a fusion of function and sophistication.Classique with its looks fits the formal corporate image and is positioned as a watch for corporate employees. This also reinforces the importance of watch along with the dress worn. These watches aregeneric in their simplicity and find no real competitors except HMT.Spectra:

Designed for those who look beyond the ordinary. This brand from Titan extends over wide range of prices from 900-7000. It is a classic premium watch with style, which boasts of combining the sturdiness of steel with richness of gold. The positioning of the watch is not very clear as it is targeted towards the salary earners with its lower price point models and appealing models for the corporate executives at the higher end.Sports Watches:In the Indian scenario the sport awareness is not quite there. And the market is notmature enough that consumers buy special watches for sporting except in the super-premiumand segments above that. A sports watch in the mind of an average Indian is a polyamidewatch with stopwatch and trendy look. So there is no clear distinction between sportswatches and casual watches. But in the available market Timex, Casio, and Titan are major players and after the lifting of QR restrictions, world famous Tag- Heur has also enteredIndia but in the Connoisseur segment of sports watches.

PSI2000:Titan has introduced a range of contemporary Precision Sports watches. The brand ismarketed as tough, outdoor, adventure brand. (Psychographically segmented) Ranging from800 to 7500, these watches are in direct competition with foreign brands like Swatch Irony.Casual Wear:The segment of watches that has a variety of brands and models to appeal to the youth and mentally young people is casual wear. The watches in this segment are mainly sporty watches, which are unconventional and typically symbolize the attitudes of younger generation.

Titan Fast Track:Cool watches from Titan.The target audience for this watch, in the 20-35 age groups include working adults and postgraduate students of both sexes in metros and mini metros. The Fast Track user, in termsof attitude is one who wears an informal dress, wears branded jeans, shirts, sunglasses and branded informal shoes. The Fast Track personality is that of a young, energetic,achievement oriented person, who seeks to express his or her individuality by braking freefrom constraints of formal environment, without being a rebel. Built around the Coolconcept, this watch from Titan has virtually very few competitors because no one offers the feature combination and price but Casio (in digital range) and Espirit and Swatch (in the analog range) can be considered as competitors feature-wise.

Technology Watches:Wrist Watches have changed a lot from the inception- a time showing conveniencemachine to a status symbol. But the underlying concept remained unchanged, convenience.Stretching this concept a bit with the development of technology are the technology watchesavailable in the market. Watch for time, status has in the new technology era is looked for convenience of carrying data. In to the competitive market with people willing to pay a premium for that advantage, a good number of brands have ventured.

Womens segment

Dress WearTitan has chiefly three brands in this category. Nebula (6000-65000)-The Jewellers Collection Nebula is a precious jewellery watch from Titan. It is marketed as a magical blend of most coveted of metals and engineering excellence. The Nebula range of watches is positioned as objects of ornamentation. A 21 carat gold watch, studded with gems it istargeted at the upper most end of the market in competition with brands such as Rolex andCartier.

RegaliaRegalia range is positioned as Essence of dress wear. It is marketed as Incredibly eye catchingmagic in gold. With the unique combination of gold and bicolour looks andsleek case, Regalia is targeted towards middle-aged women who consider watch to be a statussymbol and also representing their delicacy. It is available in many price points betweenRs.1800 onwards.

Raga and the Silver RagaRaga and the Silver Raga collection are positioned as Ethnic Indian styling for thesophisticated woman. Each piece is truly unique and represents elegance, delicacy andfeminine. The designs and the bracelets represent traditional Indian ornaments as well ascontemporary style.

Fastrack The woman's collection presents the all-new international 'Frosted' look, which istrendy and chic. The ad line: Fastrack- Cool watches from Titan aims at building the brand around the cool concept.Fastrack is targeted at a personality that is young, energetic, achievement-oriented,who seeks to express her individuality by breaking free from constraints imposed by formalenvironments, without being a rebel. The positioning of Fastrack for men and women isalmost the same.

New logo and tagline - Be MoreBeyond styleNow, Titan wants to move from style statements to personality statements. Accordingto Harish Bhat, chief operating officer, watches, Titan Industries, a watch ought to denote thewearers mood and personality. With the explosion of options in a persons life, our coreconsumer is changing. And to keep up with them, Titan has evolved too, he says.On the adoption of Be More, Bhat says that that st