This document discusses Neer Udyog Limited, a bottled water manufacturer that was the first to launch the product in India around 1990. As the total market value grew to Rs. 1000 Cr, Neer Udyog began facing intense competition from multinational corporations that entered the bottled water segment. The document analyzes the advantages MNCs had over Neer Udyog, such as established distribution networks. It also examines the challenges Neer Udyog faces, like competition and market share erosion. Finally, it considers whether Neer Udyog should extend its credit terms from 1 month to 2 months to increase sales by 15%. Tables project the sales increase and calculate the costs and benefits of lengthening
This document discusses Neer Udyog Limited, a bottled water manufacturer that was the first to launch the product in India around 1990. As the total market value grew to Rs. 1000 Cr, Neer Udyog began facing intense competition from multinational corporations that entered the bottled water segment. The document analyzes the advantages MNCs had over Neer Udyog, such as established distribution networks. It also examines the challenges Neer Udyog faces, like competition and market share erosion. Finally, it considers whether Neer Udyog should extend its credit terms from 1 month to 2 months to increase sales by 15%. Tables project the sales increase and calculate the costs and benefits of lengthening
This document discusses Neer Udyog Limited, a bottled water manufacturer that was the first to launch the product in India around 1990. As the total market value grew to Rs. 1000 Cr, Neer Udyog began facing intense competition from multinational corporations that entered the bottled water segment. The document analyzes the advantages MNCs had over Neer Udyog, such as established distribution networks. It also examines the challenges Neer Udyog faces, like competition and market share erosion. Finally, it considers whether Neer Udyog should extend its credit terms from 1 month to 2 months to increase sales by 15%. Tables project the sales increase and calculate the costs and benefits of lengthening
Chetan Sidana Dushyant Raj Verma Nikki Latta Puneet Garg Sanyam Grover INTRODCUTION 1. BOTTLED WATER MANUFACTURER 2. FIRST ONE TO LAUNCH THE PRODUCT 15 YEARS AGO ARND 1990 3. TOTAL MARKET VALUE TOUCHED Rs. 1000 Cr 4. STARTED FACING INTENSE COMPETITION WHEN MNCs ENTERED THE BOTTLED WATER SEGMENT ADVANTAGES MNCS HAD OVER NEER UDYOG LTD 1. WERE ALREADY MANUFACTURING AND SELLING AERATED SOFT DRINKS PAN INDIA 2. WELL ESTABLISHED DISTRIBUTION NETWORK 3. CHEAP CAPITAL CHALLENGES BEING FACED BY NEER UDYOG LTD 1. COMPETION FROM 2. REGIONAL PLAYERS 3. MNCs ENTERED THE MARKET 4. CONSOLIDATION OF OTHER PLAYERS THIS WAS EATING INTO ITS MARKET SHARE SHOULD NEER UDYOG GO AHEAD WITH THE LENGTHENING OF ITS CREDIT TERMS? 1. EXISTING 1 MONTH CREDIT, NO DISCOUNT 2. EXPECTED INC IN SALES 5% 3. 1/10, 60 DAYS 4. EXPECTED INC IN SALES - 15% INC IN SALES SALES PROJECTION TABLE 1 MONTHS ACTUAL PROJECTED 15% INC PROJECTED 10% INC 1 25.45 29.2675 27.995 2 27.25 31.3375 29.975 3 30.45 35.0175 33.495 4 32.6 37.49 35.86 5 32.7 37.605 35.97 6 33.5 38.525 36.85 7 27.25 31.3375 29.975 8 22.4 25.76 24.64 9 17.3 19.895 19.03 10 17.5 20.125 19.25 11 20.45 23.5175 22.495 12 24.65 28.3475 27.115 311.5 358.225 342.65 31.15 8.955625 Bad DEBT Percentage 0.0176 0.017391 0.015686 0 BAD DEBT 0.11 0.12 0.12 CREDIT SALES 2.433706 2.420543 2.531771 %OF cc 24.64 24.78261 23.66013 25