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Sonalika Rotavator– The Road Ahead*

CASE STUDY, MARKETING MANAGEMENT
ET Cases - GSMC, 9 Pages

Case Preview

Sonalika Rotavator– The Road Ahead

 

In the post-green revolution period, farm mechanization has been regarded as one the major reasons that helped reduce the human labor and enhance the agricultural productivity. The impact of farm mechanization in general and Tractor-mounted rotavators in specific for agricultural productivity has been well-recognized in India. The  level of mechanization in agriculture in India is low as compared to other agriculture-based countries which provides an opportunity to many companies to enter this industry.

Agriculture Scenario

Agriculture is the base of Indian economy and Punjab being prominent in this field has contributed to the Indian agricultural produce more than any other state. The infrastructural developments and residential requirements of the ever growing population in India have decreased the cultivated land over the recent years. Punjab is no different, as in the recent time per hectare of cultivated land is decreasing and due to this there is increase in demand of agriculture equipment which can increase the agriculture productivity so that the level of agricultural output is maintained. The net area sown had decreased from 4187 hectares in year 2007-08 to 4158 hectares in year 2010-11. The gross cropped area was 7882hectares in year 2010-11 (Exhibit I).In 2007-08 the gross area was 7870000 hectares while irrigated area was 7689300 hectares which was 97.7% and it had shown minor increase of 0.3% till 2010-11 making it 98% (Exhibit II).......................

Teaching Note Preview

Sonalika Rotavator– The Road Ahead

 

Synopsis

Sonalika Rotavator, a division of Sonalika Agro Industries Corporation in Punjab was established in year 2000.The company is situated in Dashmesh Nagar,  Hoshiarpur city, Punjab. The company division covers approx. 10 acres area of land. Rotavator is a machine with rotating blades for breaking up or tilling the soil. It is the equipment used by the farmers in sowing the crops. The Sonalika Rotavator Company has typical organizational structure with different departments like sales department, production department, marketing department, accounts department, human resource department and research and development department and all the departments are under the supervision of Business head Mr. Rajesh Thakur. Adjoining to the departments, the production unit gets operated in a very systematic way. The company owns huge production unit, which is in operation since year 2008. The company has set up its new plant in Nasrala village, 6 kms from Hoshiarpur with the expenditure of approx.50 crore rupees. The company is currently in process of shifting the departments from its old unit to its new unit in Nasrala. The reason of new plant set up is mainly business growth and expansion plan. The company gets its raw material of Rotavator through the local  companies in India. It does not import any kind of raw material or spare parts from outside.

Pedagogical Objectives

The case study can be effectively taught to Post Graduate courses or executives at levels such as Introductory Marketing, Rural Marketing and Strategic Marketing.

Specific objectives include:

  • • To make students understand the 4A’s of rural marketing.
  • • To illustrate the importance of promotional strategies in rural markets.
  • • To make students understand the product development specified to rural areas.
  • • To make students understand the importance of diversified products.
  • • To make students understand the importance of brand extension.

 

Assignment Questions

  • I. What can Sonalika do for further penetration into rotavator market?
  • II. Why Sonalika started Rotavator, and why they started so late?
  • III. What kind of expansion strategy should Sonalika keep in future?
  • IV..............................................

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Abstract

Agriculture continues to be the backbone of the economy of the Punjab State also known as ‘Food Basket’ of the country. The future growth of the sector and state will largely depend upon public policies supported by the developments and use of technology including farm machinery. To facilitate persistence of green revolution and support the Indian farmers with mechanization technology, Sonalika Group (Sonalika) a renowned name and one of the top three tractor selling companies in India, established Sonalika Agro Industries Corporation to diversify into farm equipment manufacturing.

In year 2008, Sonalika extended the brand name to rotavators and today has a wide range of products in terms of price and sizes of the rotavators. The sale of rotavator depends heavily on external environment factors such as season, government subsidies, agricultural scenario, migrant labors, etc.

As a part of Sonalika’s expansion plan and also due to intense competition from other established players recently the company decided to extend its capacity of rotavator production and is in the process of setting up of a new plant. The case study focuses on the expansion and diversification strategies of Sonalika and will also highlight the challenges of rural Marketing in terms of 4A’s (Awareness, Availability, Acceptability & Affordability).

The case study has been prepared with the help of extensive interviewing and observation of officials of Sonalika, Agricultural department officials, Rotavator dealers and Farmers.



Pedagogical Objectives

  • To assess the effective use of 4A’s of rural marketing to penetrate in rural market
  • To discuss Sonalika’s product diversification strategy for competitive advantage in agricultural equipment market
  • To discuss the new product development and brand extension strategies adopted by Sonalika

Case Positioning and Setting
The case study can be effectively taught to Post Graduate courses or executives at levels such as Introductory Marketing, Rural Marketing and Strategic Marketing.

* GSMC 2014, IIM Raipur

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- Abstract
- Case Study
- Teaching Note (**ONLY for Academicians)
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