report grohe
TRANSCRIPT
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ACKNOWLEDGEMENTS
The successful completion of any task would be incomplete without the mention of people
who made it possible, whose constant guidance and encouragement crown all efforts with
success.
First of all I would like to thank the “GROHE India Pvt Ltd.” Company for giving me the
approval to do this project in the organization. I grateful thankful to Mr. Renu M isra (Managing
Director) who has given this opportunity to study the organization in totality, which provided me
with the immense managerial, and production knowledge, which is used by their organization for
the moral support, encouragement and generous assistance.
I am thankful to Mr. Ravi Mamdapur (Regional Sales Manager) who has guided me to
take up this project and for all the hospitality that he has given me which has enabled to
complete my project on time.
I also thank the staff and workers who have co-operated with me in successfully
completing my project by providing valuable information and knowledge about the functioning
of the organization.
I am very much thankful to Mr. Suni l Desai Principal of people tree College of
Business Administration Belgaum, for the support and encouragement to finish this report. I
thank my faculty guide Ms. Seneca Kalghatkar for coordinating the project work and giving me
the guidance. I am thankful to many individuals in the company for the encouragement and
professional assistance.
KUBER RAIBAGI
5TH
SEMISTER, BBA.
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DECLARATION
I hereby declare that this project work is the result of my original work. The findings and
conclusion is based on the information collected by me during the study. I am solely responsible
for any errors in the work.
Date: Mrs. KUBER RAIBAGI
Place: Belgaum Registration No:
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Abstract
This project is based on “problem solving”. As a part of course requirement the
students „Bachelor of business administration has to take up a project for a month.
The basic purpose of the project is to enable the students to expose the working of
any organization and manager, to relate the concept learned by the students to the working of the
organization, to understand the practical aspect of working of organization.
It aimed to diagnose the cause of company’s problems and to formulate programs for
improvement.
This project is on the study of ‘GROHE INDIA PVT LTD‟ The project is done based
on the information, manuals etc, given by the ‘Grohe India Pvt Ltd‟
The report initiates with brief introduction of company it covers many aspects of
‘Grohe India Pvt Ltd‟like Company profiles, scope, limitations etc. Finally this project report is
on “Consumer behavior of luxury sanitary ware” of „Grohe India Pvt Ltd‟ ends suggestions
and conclusion.
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EXECUTIVE SUMMARY
This project deals with the behavior of end consumer of luxury sanitary ware. Today faucets &
showers are no more just the requirements for consumer, but a luxury commodity. India is agrowing market touching world standards in sanitary market. With advent of local guerilla in
sanitary market, competition for new entrants is tough in lower segment. Since upper middle
class income group in south asian countries like India is growing very rapidly, the consumption
of luxury items will also increase at a faster pace. Indian sanitary ware industry is worth
$700million.
We have focused on the brand awareness among builders, contractors, architects and end
consumers and tried to sneak into those factors which they look for a while buying any sanitary
products. We also found out what are those cues and parameters which are prompting a
consumer from awareness to consideration. During this we also made some viral advertisement
to create awareness among Indian buyers. Since internet today, is the most cost effective &
extensive reach for consideration set. And we also studied distribution channel for the GROHE
India Pvt Ltd. Our area is Hubli, Karnataka. Hubli is the growing city in India with more than
150 running projects.
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Contents
1. Introduction
2. Grohe A brief history
3. 4 P’s of Grohe
4. Internship objective and task
5. Research proposal
6. Observation
7. PCWS analysis of Indian sanitary ware market
8. Suggestions
9.
Appendicies
I. Questionaire
II. Research Calculations
III. Refrence
IV. Glossary
V. Index
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COMPANY PROFILE
Name of the unit:- GROHE INDIA PVT LTD.
Location of the unit 14th Floor, Building no5, Tower A
DLF Cyber City, Phase III
Gurgaon – 122001
India Phone: ++91 124 493 3000
Call us toll free at 1 800 102 4475
Fax: ++91 124 493 3001
Website: http://www.grohe.co.in
Constitution:- Subsidiary company.
Name of the managing
Director:- Mr. Renu Misra
Activities: - Manufacturing of faucets & shower(bathroom appliance)
Industry sector:- construction/infrastructure
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INTRODUCTION OF THE COMPANY
GROHE India Pvt Ltd is a fully subsidiary of Friedrich Grohe AG of Germany. Grohe has
generated into the Indian market in 2005. It has mulled a joint venture with Indian sanitary giantHindustan Sanitary India Ltd. (HSIL). HSIL better known as Hindware has helped German
incumbents to use its experience. Grohe in india is targeting niche market of luxury highly
sophisticated and technologically advanced sanitary ware market which if experts are believed,
is increasing at a faster pace. Marketing mix of Grohe was interesting to study because it has
product ranging from 2000 to 20000 INR. Also it distribution channel is very effective and
considered best in industry.
•
Grohe India Pvt. Ltd. (GIPL) is a wholly owned subsidiary of Grohe, Germany
•
Has completed three years of direct operations in India
• Grohe recently launched its first Indian ‘GroheTechnology Centre’ in Bangalore in
November 2009.
VISION MISSION & GOAL
• Global vision is to become the market leader in every country they are present in by the
year 2015.
• As experts in water technology, it has mission to develop superior showers with
outstanding features.
• GROHE’s Goal is to see its place at the forefront of the industry in the coming year and
the coming decades.
• It is companies objective to strike a perfect balance between perfect experience and
environment.
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HISTORY OF THE COMPANY
Grohe AG is Europe's largest manufacturer of sanitary fittings, including kitchen and
bathroom faucets/taps, and shower systems. Grohe has a worldwide market share of roughly
eight percent in this product segment. The Grohe corporate centre is located in
Dusseldorf, Germany, and it has offices in many parts of the world, including a US headquartersin Bloomingdale, IL. Grohe has six production sites, with locations in Portugal, Thailand, and
Canada, along with three in Germany. The company has 9,000 employees, 3,400 of them
working at its Chinese subsidiary Joyou.
1911 UNTIL 1990: FAMILY-OWNED
The company started as a ferric hardware factory in 1911 under the name Berkenhoff &Paschedag, located in Hemer, Germany; it was taken over by Friedrich Grohe in 1936, whofocused on sanitary faucets only. Before that, Friedrich used to work for his father'scompany Hansgrohe, founded in 1901. The first order from outside of Germany came in 1938. In1948, the company was renamed to Friedrich Grohe Armaturenfabrik. In 1961, by which timethe company had purchased a factory in Lahr/Schwarzwald, the company set up its firstsubsidiary abroad in France. A year later in 1962, Grohe acquired exclusive rights to producethe Moen Mixing Faucet, which mixes hot and cold water with a single lever.
In 1968, Friedrich Grohe sold a 51% stake in the company to International Telephone &
Telegraph (ITT). During the '70s, Grohe openedsubsidiaries in the US, UK, Holland and
Belgium and introduced the ergonomic hand shower series Relexa.1982 saw the beginning of
production at the new factory in Hemer-Edelburg. Friedrich Grohe died in 1983; in the following
year, his heirs bought back the part of the company which had been sold to ITT. In 1989, therewere some additions to the Lahr production site and a new logistics dept was opened at Hemer-
Edelburg.
1990S AND 2000S: INVOLVEMENT OF INVESTORS
In 1991, the company bought two other producers of faucets: Herzberger Armaturen GmbH from
the Brandenburg region andArmaturenfabrik H. D. Eichelberg & Co.
GmbH at Iserlohn in Westphalia. Grohe was also restructured as a public limited company. By
taking over the DAL group in 1994, the company acquired a production site in Porta Westfalica, Westphalia; at the same time, the company also acquired Tempress Ltd. of Mississauga in
Ontario (Canada). At the Hemer site, new technology and factory control facilities were opened;
in 1996 saw the company expand to Portugal and Thailand. A new design centre followed at the
Hemer site in 1997.
In 1998, a group of investors working with BC Partners bought all available Grohe shares and
delisted the company in the following year, making the Grohe Holding GmbH company, owned
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by BC partners, into the majority owner of Grohe AG in 1999. BC partners sold the company to
a consortium of investors from the Texas Pacific Group and CSFB Private Equity (a subsidiary
of the Swiss Credit Suissebanking group) five years later in 2004.
In 2005, Franz Müntefering, chairman of the then ruling German Social Democratic party (SPD),
sparked a debate on capitalism by designating foreign private equity firms as "locusts".He made
TPG-owned Grohe his main example. The "locust" metaphor remained popular in German
politics and media for years while the German government cited Grohe as an example for a
successful turnaround only three years later.
The company’s sales and profit figures had been stagnating for years, leading to a programme of
savings as of 2005. Around 500 production jobs were cut at sites in Germany and the Herzberg
factory was closed; the sites in Thailand and Portugal were expanded considerably. Through
2008, investments totalling 130 million euros were made in Germany in the area of production
technology and logistics.
PRESENT HISTORY
In 2012, Grohe AG’s revenues increased by 21 percent to 1,405 million euros; operating
profits improved by 18 percent to reach 273 million euros, representing a return on revenue of
19.4 percent. Grohe is currently Europe’s biggest manufacturer of sanitary fittings and has eight
percent of the worldwide market.The German market makes up roughly 15 percent of overall
sales. Currently, Grohe AG is owned almost 100% by Grohe Holding GmbH (there are still some
minority shareholders from the period in which Grohe AG was listed on the stock market).
Grohe Holding GmbH is owned by investors.
June 2010 saw a ruling against the European sanitary fittings industry by the European
Commission. The Commission found that European manufacturers had operated a cartel between
1992 and 2002 and imposed a collective fine of 622 million euros. Grohe’s share of the fine
amounted to 54.8 million euros.The current Grohe board of directors, which took up business
after the period under investigation, introduced awareness programmes about competition law
and operates a zero-tolerance policy towards price-fixing.
In early 2011, Grohe acquired a majority stake in the leading Chinese sanitary fittings
producer Joyou, making a successful public takeover bid. The aim of this takeover is above all tostrengthen Grohe’s sales infrastructure on the fast-growing Asian market. Grohe currently holds
a 72 percent stake in Joyou.
In May 2013, David Haines, chairman of Grohe, confirmed that, although the company is
examining all options for ending investor involvement, no concrete plans had yet been made.
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Capital market experts estimate that Grohe would currently be valued at up to four billion euros
if it were to return to the stock market.
In September 2013, it was announced that Grohe had received the largest ever investment from a
Japanese company in the country. The firm is now almost entirely owned by the Japanese
building materials company Lixil and Development Bank of Japan, after a €3 billion deal for
87.5 percent of the firm.
GROHE IN U.S
In 1975, Grohe opened a small office just outside Chicago and its representative, Urell, Inc. in
Massachusetts, began supplying European-style kitchen and bathroom fixtures to American
tradesman and retailers. The new venture was incorporated a year later as Grohe America,
Inc. and moved into a small warehouse-office complex. In order to keep pace with its rapid
growth, the company regularly upsized its premises: a section of a larger warehouse facility in
1978; a whole warehouse in Wood Dale in 1986, finally settling into today’s custom-built 90,000
square foot facility in Bloomingdale, Illinois, in 1993.[5]
Sales figures doubled year after year as Grohe introduced a series of products such as
the Ladylux of 1983 – the first pull-out spray kitchen faucet, including detachable hand-sprayand
snap-on accessories (also the first hand-spray with a filter for drinking water), on the US market
– or the Europlus of 1989, another pull-out spray faucet. In the early 1990s, Grohe introduced a
new designer finish "white" which increased sales dramatically for the next 7 years. Introductionof clear powder-coating in the 1980s resulted in the advent of polished brass and other finishes
with superior adhesion, solving a major problem in the industry. In the late 1990s, Grohe
replaced the powder-coated first generation of these products with stainless steel versions.
1979 saw the launch of the Grohmix thermostat line, able to regulate water temperature to within
one degree Fahrenheit of accuracy. As of 1980, Grohe also implemented water-temperature
regulation technology in its successful range of custom showers which is still a strong seller in
the marketplace due to its unique design.
These shower systems saw Grohe America take the step of advertising directly to consumers. For
commercial customers, Grohe introduced a new product line in 1989, following it up with a
showroom marketing program for wholesalers. In 1996, Grohe America launched its first
television advertisement campaign and started offering a limited lifetime warranty as of 1997. By
the mid-1990s, Grohe America was selling fixtures with a value of $38 million annually, with a
market share of 1.7 percent.
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Grohe opened a 15,000 square-feet showroom for professional partners and visitors on Fifth
Avenue, New York in September 2011.[13] In February 2012, Grohe announced its US
headquarters will move from Bloomingdale, Illinois to New York City.
Grohe Group S.A R.L. is the ultimate parent company of the group. The following shows astructure chart oh the group showing the company, its subsidiaries and the two parent companiesof the main operating entities – Grohe AG and the publicly traded Joyou AG.
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ORGANIZATION STRUCTURE
General Manager
Factory ManagerOffice Manager
Production Department
Marketing Department
Finance Department
R & D Department
Designing Department
H.R. Department
Maintenance Department
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OBJECTIVE OF THE STUDY
1. To understand the consumers buying behavior of luxury sanitary products.
2. To prepare the database of future customers of grohe products.
3. To do a competitors analysis of grohe India.
4. To study supply chain flow of grohe India.
5. To develop an advertisement for grohe India.
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ANALYSIS AND INTERPRETAION OF THE CASE
The study is highly dependents upon the ratio analyses where the relationship between various
assets and liabilities are analyzed and plans and policies are executed.
The methodology adopted for this study is as follows:
Data source
Primary data: I had visited the project workplace and studied the various aspect in
management systems by personal observation, discussion with the contractors, architects,
plumbers and engineers of the various projects.
Secondary data: the relevant information for secondary data was collected from various
sources like various records maintained, through the company’s different manuals and
procedures & through the survey.
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RESEARCH METHODOLOGY
Sample size: As the company problem is consumer buying behavior the sample size will be 25.
The questionnaire were submitted to 5o consumers out of which the sample size 25. The 25
samples are been picked/selected randomly.
Statistical tools and techniques:
Pie chart
Doughnut graph
Bar graph
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INTERPRETATION
1.
Your income group (per annum) for end consumers only.
a) 5-10lakhs
b) 10-15lakhs
c) 15-20lakhs
d) Above 20lakhs
In the above graph the income group of the consumers which is highest rated is between 5-
10lakhs and rest all are constant and the entire graphs also states that there is a constant income
group in Belgaum city the graph also states that the income of consumer also plays a importantrole in the buying behavior.
28%
24%24%
24%
5-10lakhs
10-15lakhs
15-20lakhs
above 20lakhs
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2. What appliance do you use/prefer to fit in your bathroom/kitchen?
a) Jaguar
b)
Parry warec) Kohler
d) Others
In the above graph the brand which consumers prefer much can be understood here 52% of
consumers go for local brand and as usual 12% jaguar and 12% for parry ware and 24% of the
consumers for kohler brand.
12%
12%
24%
52%
ab
c
d
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3. Does product brand of appliance affect your choice?
a) Yes
b) May be
c) Not at all
The analysis in this graph was done on does brand choice affect their buying behavior and 56%
of consumers stated that no brand doesn’t affect their choice while buying. Whereas only 28%
consumers are affected by brand go on brand while making a choice.
28%
16%
56%
yes
may be
not at all
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4. What importance does bathroom have in your home?
a) Very important
b) Important
c) Not much important
d)
Doesn’t matter
In above graph 48% consumers stated that the bathroom plays very important role their house as
and 40% stated that its important 8% not much important & 4% doesn’t matter.
48%
40%
8% 4%
very importantimportant
not much important
doesn’t matter
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5. Are you satisfied with bathroom/ kitchen appliance? (Grohe brand).
a) Satisfied
b) Neutral
c) Dissatisfied
The above question was asked to only 15 consumers which were existing customer who were
using grohe brand appliance. Out which 47% are satisfied with grohe and 33% rated it as neutral
and 20% consumers were dissatisfied.
47%
33%
20%
satified
neutral
dissatisfied
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6. How do you rate advertisements from the following sources?(1 for low 5 for high)
7. How much are you affected by the advertisement for your choice?
3
4
6
7
3
6 6
4
3
5
7 7
5
4 44
3 3
5
7
5 5
7
6 6
0
1
2
3
4
5
6
7
8
Print media Tv advertisement Mall media Fm/radio
advertisement
Billboards
1
2
3
4
5
S.no Sources
1 Print media (Newspapers, Magazines
etc)2 TV Advertisement
3 Mall Media
4 FM/Radio Advertisement
5 Billboards
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a) Daily
b) Twice a week
c) Weekly
d) Fortnightly
As internet is playing important role in today’s world and is one of the powerful media for
advertisement this question was asked how much consumers are been using internet in their day
to day life. In the above graph 53% of consumers use internet daily where as 27% consumers use
twice a week and so on.
53%
27%
15%
5%
daily
twice a week
weekly
fortnightly
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9. Do you think of changing your the appliances during renovation?
a) Yes
b) No
In the following chart 72% of consumers stated that they think of changing their appliance while
renovating their bathroom/kitchen and 28% think that it’s not necessary to change.
72%
28%
yes
no
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10. How much are you willing to spend on bathroom/kitchen appliances?
a) 50000-1lakh
b) 1-1.5lakhs
c) 1.5- 2lakhs
d)
2- 2.5lakhs
In the above chart the 45% consumers think of spending 1.5to 2 lakhs on bathroom and kitchen
appliances & 27% are willing to pay 1-1.5lakhs.
23%
27%
45%
5%
50000-1lakh1-1.5lakhs
1.5-2lakhs
2-2.5lakhs