Question 1. Identify the key problems, why they exist, how the impact the organization and who is responsible for them.

Question 2. Uncover possible solutions by reviewing course readings, discussion, outside research, your experiences.

Question 3. Be realistic.

Select the best solution by considering strong supporting evidence, pros and cons.

Question 4. Do you think direct export is the only possible option? Are there other options that the company might have pursued?

1:42 PM On 66 Assignment Details .. . Indian Ayurveda Pharmacy Ltd The Indian Ayurveda Pharmacy Ltd is located in company has always maintained a unique image that Coimbatore, Tamil Nadu. It manufactures and mar- blends quality and tradition in a unique way. The old kets ayurvedic products under its own brand name. hospital still exists with more extensive and improved The company was established in the early 1950s by a facilities. The company has lately entered the cosmetics well-known ayurvedic physician as a small pharmacy and personal care segment with some lotions, hair oils, attached to his ayurvedic hospital. The company has and toilet soaps. Its soap brand Jeevan has become very witnessed tremendous growth over the past 50 years popular over the last few years. Sales figures soared to with sales growing from just thousands of rupees to reach a figure of 10,00,000 units in just three years. 200 million annually. The company has a large This is a big achievement. The soap has a unique portfolio of ayurvedic products which are mostly sold fragrance and has numerous loyal users. The soap is through its network of exclusive retail outlets spread sold through large distributors to retail outlets. The over Kerala, Tamil Nadu, and Karnataka. Presently, company regularly receives enquiries about it from far there are about 500 retail outlets in these states. The and wide. The brand is promoted through television nid radio and also through wall paintings and bill- expatriate Indian population of over 2 million to which Wards. The company feels that given its unique the products can be targeted. The company expects to intures and the image of a fresh and natural product, sell at least 4,00,000 units annually to begin with, as the scope for expansion is tremendous. The company wants to venture into new markets. The company's selling less than 10,000 units will not be a profitable market surveys reveal that its soap is generally preferred proposition. After considerable analysis of the alternatives, the by ladies and gents who are either middle-aged or company has decided to appoint distributors to sell its old but not so much by the youth. This is probably products in these countries. The company searched for because of the ayurvedic features that do not seem to possible distributors to see which distributor will be is advertised. appeal to the younger set, particularly in the manner it more suitable to handle a product like this. Initial en- quiries with the embassies of these countries provided Export strategy a large list of distributors who actively trade with India. These include distributors with high levels of experience The company has of late noticed that non-resident in handling trade-related issues and connections Indians, especially those belonging to the southern parts with large retailers in these countries. Most of the of India, buy Jeevan soaps in large quantities to take distributors charge a margin of about 20 to 30 per cent back to their countries of residence. This is probably for handling a product like this: Also, the distributors . because they have strong brand loyalty and consider the are not willing to pay in advance to the manufacturer. inherent qualities to be quite attractive in comparison This is because the product is new to the market and to the brands available abroad. The company is now it is considered quite risky to handle a product like planning to export its Jeevan brand abroad, particularly this. The distributors have decided to take title to the' in the Middle East which has a sizeable population of goods and supply to retail outlets on a trial basis, Once. south Indians. The company has adequate production there is enough evidence for market acceptance, the supply will be made more regularly. The initial orders capacity to meet additional demands for export. All will be for small sizes and later when the demand picks the company now needs to: do is to work on its-new . up, orders of higher value will be made. Most of the marketing strategy to reach its target market. Making "distributors have sufficient experience in handling such arrangements for producing the soap abroad is not types of products and some of them are even handling considered a viable option since it involves high competitive brands. The transportation charges are to investment and also the regulations abroad necessitate be borne by the company. clearances from several agencies. Hence, the company is more or less stuck with the export strategy. The company's target population is mostly concentrated in six countries of the Gulf: Kuwait, The United Arab Emirates (UAE), Bahrain, Qatar, Kingdom of Saudi Arabia (KSA), and Sultanate of Oman. Each of these countries has different rules and regulations with regard to exporting goods, as well as different currencies. Out of these, the maximum number of people the company wants'to target reside in Kuwait, UAE, and KSA. It is estimated that the three countries together have an View Quiz