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International Marketing

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Oron Watch Corp. – entering Nigeria
Submitted by :
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Afreen . J Khan (19)
Shabahan Meethal
Pratik Choudhary
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Tausif Khan

Submitted To:

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Prof. Quresh Moochhala

MMS (sem - III)

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BES’s IMSR, Mazgaon
Date: 12/10/2010

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Visit us at: www.oronwatches.com

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Acknowledgement:

We are solemnly thankful of Prof. Quresh Moochhala for

being our mentor and guide throughout the journey of learning

“International Marketing”. We thank Prof. Shikhare for letting

us

know the horizons of knowledge in the college. We would also

thank

librarians Mr. Noor Mohammed Khan and Mrs. Mugadha Odak.

Last

but not the least, we are thankful to all friends who have been
with

us all the time, being an inspiration. And first and last thank to
my

Lord, the most beneficent and merciful, who made us all

capable to

learn, understand and pen !

2
Contents:
Cultural Analysis
I. Introduction

II. Brief history of

III. Geographical settings

IV. Social institutions

V. Religion and aesthetics

VI. Living conditions

VII. Language

VIII. Executive summary

Economic analysis
I. Introduction

II. Population

III. Economic statistics and activity

IV. Development in science and technology

V. Channels of distribution (macro analysis)

Marketing plan

3
 I. Marketing plan

II. Pro forma of financial statements and budgets

III. Resource requirements

IV. Executive summary

V. Sources of information

I . Introduction: Oron Watch Corporation is an Indian watchmaker. We

specialize in sports watches. Globalization has opened the doors to

international market, so this is our first optimistic and ambitious step

towards internationalization. We believe in best quality and positive

efforts. We are good enough but want to be one of the bests among

watchmakers.

Vision: To provide the timepiece at right time to every ambitious

sportsperson.

Mission: To be the best in quality, reliability and technology so that we

can be the first choice of every sports person.

Objectives: we have following objectives:

• To come up with the best quality sports watch.

4
 • To inculcate the culture of continuous improvement.

• To build a strong brand in the Global market.

• To make a strong relationship with the customers.

• To generate customer delight and loyalty.

Oron Watches: Oron is one of the best quality sports watches with

following features:

• High-Sensitivity, Watch-Like GPS Receiver That

Provides Exceptional Signal Reception

• 1 Piece Training Assistant That Provides Athletes With

Precise Speed, Distance & Pace Data

• Includes Training Center Software, Which Allows

Users To Download Workout Data For A Detailed Analysis

• Used For Multiple Sports Such As Cycling, Cross-

Country Skiing & Windsurfing.

We are willing to trade with Nigeria, one of the growing economies. It has

found a large potential for the best sports people in it. And we are

targeting the same potential target market.

(http://www.state.gov/r/pa/ei/bgn/2836.htm)
5
III. Geographical Setting:

A. Location

Source: ( www.mapsofworld.com )

Nigeria is located in Western Africa(as shown in the map above) , and

borders the Gulf of Guinea, between Benin on the west and Cameroon on

the east. It has a compact area of 923,768 square kilometers (356,376

square miles). The country's land mass extends from the Gulf of Guinea

in the south to the Sahel (the shore of the Sahara Desert) in the north.
6
Comparatively, Nigeria is slightly more than twice the size of California,

or the size of California, Nevada, and Arizona combined. Abuja, the

capital city of the Federal Republic of Nigeria, replaced the former capital

city, Lagos, in December 1991, because of its more central location,

among other reasons. Lagos remains Nigeria's commercial capital. Other

major Nigerian cities include Ibadan, Kaduna, Kano, Maid-uquri, Jos, Port

Harcourt, Enugu, Calabar, and Aba.

B. Climate :

As in most of West Africa, Nigeria's climate is characterized by strong

latitudinal zones, becoming progressively drier as one moves north from

the coast. Temperatures throughout Nigeria are generally high; diurnal

variations are more pronounced than seasonal ones. Highest

temperatures occur during the dry season; rains moderate afternoon

highs during the wet season. Average highs and lows for Lagos are 31° C

and 23° C in January and 28° C and 23° C in June. Although average

temperatures vary little from coastal to inland areas, inland areas,

especially in the northeast, have greater extremes. There, temperatures

reach as high as 44° C before the onset of the rains or drop as low as 6°

C during an intrusion of cool air from the north from December to

February.
7
 C. Topography:

The topography of Nigeria consists of plains in the north and south

interrupted by plateaus and hills in the centre of the country. The Sokoto

Plains lie in the northwestern corner of the country, while the Borno

Plains in the northeastern corner extend as far as the Lake Chad basin.

The Lake Chad basin and the coastal areas, including the Niger River

delta and the western parts of the Sokoto region in the far northwest, are

underlain by soft, geologically young sedimentary rocks.Gently

undulating plains, which become waterlogged during the rainy season,

are found in these areas. The characteristic landforms of the plateaus

are high plains with broad, shallow valleys dotted with numerous hills or

isolated mountains, called inselbergs; the underlying rocks are

crystalline, although sandstones appear in river areas. The Jos Plateau

rises almost in the centre of the country; it consists of extensive lava

surfaces dotted with numerous extinct volcanoes. Other eroded

surfaces, such as the Udi-Nsukka escarpment (see Udi-Nsukka Plateau),

rise abruptly above the plains at elevations of at least 1,000 feet (300

metres). The most mountainous area is along the southeastern border

with Cameroon, where the Cameroon Highlands rise to the highest points

in the country, Chappal Waddi (7,936 feet [2,419 metres]) in the Gotel

Mountains and Mount Dimlang (6,699 feet [2,042 metres]) in the Shebshi

Mountains.
8
IV. Social Institution:

A. Family: A family, which is usually made up of people who are

related by blood, marriage, or adoption, is very important to most

Nigerians. There are two major family types; the nuclear family,

which is made up of one man, his wife, and their unmarried

children, and the extended family, which is usually made up of a

series of nuclear families. Culturally, most Nigerian cultural groups

practice patrilineal descent, have patriarchal authority, have

patrilocal rule of residence, and are generally patricentric in

outlook. The children are socialized with this arrangement in mind,

and female children are consciously socialized to serve and be

subordinate to males.

B. education:

Nigerian law requires compulsory education for all students between the

ages of 6 and 15. Students in primary and secondary school attend three

equally divided sessions from January through December, with about a

month vacation between sessions.

In 1982, Nigeria switched to the American system of six primary, three

junior secondary, and three senior secondary school grades, but the rigid

examination system remained. To qualify for entry into Junior Secondary

9
School (JSS), Senior Secondary School (SSS), and higher education,

nationwide examinations are held each year. Because exam scores

determine a student's future educational choices, schools tend to stress

memorization of facts, rather than creative problem solving. There are

not enough senior secondary schools in Nigeria, so most students who

finish JSS go into the workforce.

Subjects taught in primary education include English, mathematics, bible

knowledge, science subjects, and 3 native languages – Hausa, Yoruba,

and Ibo. Students are required to take the Common Entrance

Examination after 6 years to be admitted into the Federal and State

Government schools. State-owned secondary schools get funds from

each state government while private secondary tend to be more

expensive with annual average tuition fees of $1000-$2000.

Nigeria has major control of university education. English is the official

medium of instruction in the higher education. The academic year starts

in October and ends in September. There are 13 Federal and 14 State

owned polytechnic colleges in the country. Nigerian universities are

usually grouped on the following categories:

C. Political System: Nigeria is constitutionally a federalist state, with

certain powers held by the states and others reserved to the federal

government. According to the Constitution, the president is to be elected

10
every four years by popular vote, and the judiciary is to consist of state

and federal courts.

D. Legal system:

The legal system is based on English common law, Islamic law, and

customary law.

The Nigerian legal system has had a lot of influence from English law on

it's growth. Right now, English law forms a substantial part of Nigerian

law. However, the Nigerian legal system is somewhat complex, and has

several sub-systems.

• At the Federal level, there is a general federal legal system that is

applicable throughout the country.

• At the lower levels, each state (including Abuja) has it's own legal

system.

• Also, local customs are applicable laws in some states.

The sources of Nigerian law are:

1. Nigerian legislation

2. English law

3. Customary law

11
 4. Judicial precedents: the principle of law on which a judicial decision

is based.

LEGISLATION

Nigerian legislation consists of:

• Statutes: laws enacted by the Legislature (which is a part of the

government). This further consists of:

Ordinances: laws passed by the Nigerian Central Legislature before

October 1, 1954.

CUSTOMARY LAW

Customary law consists of customs that people in a certain community

hold as being binding to them, and recognized as law by them.

Customary laws may be relevant for certain ethnic groups, or certain

religions, and sometimes even for certain states.

(http://www.motherlandnigeria.com/legal.html)

e. Social Organizations:

12
 The nightclub culture is quite prevalent in Nigeria and the young

Nigerians often visit discotheques and beach parties. The urban crowd

watches Nigerian movies (Nollywood movies) and engages in different

art forms such as jazz dancing and western singing that provide them

great entertainment and recreation. The consumption of liquor is also

said to be one of the primary recreational activities amongst the

urbanized Nigerians. NEFA film festival is one of the most popular film

festivals in Nigeria, which celebrates the art of cinema by exhibiting

great movies from across the world. There are different organizations

and entertainment set-ups in Nigeria such “Ariztos”, which takes care in

providing full-time entertainment to the people of Nigeria. The rural

section of the society engages in local activities such as fishing, hunting,

singing and dancing. These are their main sources of entertainment

around which their daily lives revolve.

(http://www.mapsofworld.com/nigeria/tourism/entertainment.html)

V. Religion and Aesthetics:

Nigeria religion comprises a number of religions, mainly Christianity, Islam and

the traditional religion of Nigeria. Islam mainly dominated the northern part of

13
Nigeria, while Christianity was prevalent in the southern part of Nigeria, among

the Yoruba and the Igbo ethnic groups. Yoruba people inhabiting in Nigeria are

mainly practitioners of Protestantism, while Igbo and the groups residing in the

nearby areas are followers of Catholicism. Nigeria religion represents Nigerian

culture.

Even though Islam and Christianity are the main Nigeria religions the people are

also tolerant towards all the other minor religions.

(http://www.mapsofworld.com/nigeria/culture/religion.html)

Aesthetics:

Nigerian art is an important part of Nigeria culture. Art in Nigeria has been

important for more than 2000 years. As multi-ethnicity exists in Nigeria,

art of Nigeria is influenced by many tribes and ethnic groups.

Nigerian art comprises of ivory carving, grass weaving, wood carving,

leather and calabash. Pottery, painting, clothe weaving and glass and

metal works are other important forms of Nigerian art

Music is another important Art of Nigeria. Popular music includes highlife,

afrosoul, fuji, afrobeat, juju, apala, gospel, sakara, reggae, jazz, hip hop

and a lot more. The most musical important instruments are percussion
14
and string instruments. Art in Nigeria includes the Nigerian literature.

Literature typically followed an oral tradition in Nigeria, like it did in other

parts of Africa. However presently Nigerian literature has gained wide

popularity not only within the country, but internationally.

(http://www.mapsofworld.com/nigeria/culture/art.html)

(http://www.mapsofworld.com/nigeria/culture/music.html)

VI. Living conditions:

A. Diet and Nutrition:

The name Nigeria is taken from the Niger River, which plays an important part in

Nigerian lives.

People of the northern region (mostly Muslim, whose beliefs prohibit eating pork)

have diets based on beans, sorghum (a type of grain), and brown rice. The Hausa

people of this region also like to eat meat in the form of tsere or suya (kebabs,

which are chunks of roasted, skewered meat). Muslims love to drink tea, making

coffeehouses popular places to socialize.

The people from the eastern part of Nigeria, mostly Igbo/Ibo, eat gari (cassava

powder) dumplings, pumpkins, and yams. Yams are usually eaten in place of

potatoes and are an important part of the Nigerian diet. However, African yams

are different than Western yams. They are pale, barely sweet, and are not

15
commonly found in United States supermarkets.

(http://www.foodbycountry.com/Kazakhstan-to-South-Africa/Nigeria.html)

B. Housing:

The rate of urbanization in Nigeria has witnessed tremendous increase in the last

two

decades. Census in the early Fifties showed that there were about 56 cities in the

country

and about 10.6% of the total population lived in these cities. Given the expected

increases in Urban population, the magnitude of housing problem in

the country is enormous. According to the National Rolling Plan (NRP) the national

housing requirement is between 500,000 and 600,000 units considering the

prevailing

occupancy ratio of between Three and Four persons per room.

Relating annual requirements for housing with the Gross Domestic Product of

N82.53 billion in 1988 and 85.82 billion estimates for 1989, and over 88 billion in

1991 as

well as per capital income of N3,000.00, financing becomes a major factor of the

housing problem especially long term funding.

16
(http://www.fig.net/pub/proceedings/nairobi/ajanlekoko-CMWS1-1.pdf)

c. Clothing:

Nigerian Clothing is completely based on the Nigeria Culture. As Nigeria is a

multi-ethnic, there are lot of ethnic groups and each of them have their

traditional dress code. Clothing in Nigeria have a great variety. In the north,

people prefer their outfit based on their work. In the south, people are

pretty much fond of dressing up.

Important materials for Clothing of Nigeria are lace, jacquard, adire, ankara.

Nigerians are also fond of tie and die materials. Nigerian Clothing for

women includes buba, kaba, iro, gele and iborun or ipele.

Nigerian Clothes for men comprises of buba, fila, sokoto, abeti-aja and

agbada

(http://www.mapsofworld.com/nigeria/culture/clothing.html)

D. Recreation , sports and other leisure activities:

Nigerian Entertainment comprises of Nigerian religious festivals, film

festivals, dances and music. There are other forms of entertainment and

17
 recreation in Nigeria such as participating in games and sports activities,

watching good Nigerian movies and also taking substantial interest in the

country's rich tradition literature and art.

(http://www.mapsofworld.com/nigeria/tourism/entertainment.html)

Nigerian sports, though always exercised, was noted first in the 1950s. Nigeria

had it's first appearance in the Helsinki Olympic Games in 1952, and it's first

victory in 1954, when Emmanuel Ifeanjuna won a gold medal in the high jump at

the Commonwealth games in Cardiff.

In 1962, the Nationals Sports Council was set up, and in 1971, the National Sports

Commission was established.

(http://www.motherlandnigeria.com/sports.html)

E. Social security: Social security is a human right, as well as an economic

and political necessity. In Nigeria piecemeal social security programmes

have been in place since 1942 starting with the workmen’s compensation.

Others are benefits for temporary and permanent disability, unemployment,

maternity and sickness. All these have been going on without a unified

policy with no clear funding. Following a resolution of 11th International

Labour Organisation African Regional Meeting (Addis Ababa, 24-27 April

2007) a tripartite African ILO members committed themselves to develop

18
 national action plans to build basic social security to all and Nigeria is an

active player in the International Labour Organisation's (ILO) affairs and

playing host to the labour watchdog since 1960.

(http://www.nigeriavillagesquare.com/articles/anyanate-ephraim/social-security-

policy-for-nigeria-matters-arising.html)

F. Health care:

Traditionally, health was taken care of by 'medicine-men'. Now Nigeria has

National Health Policy.The goal of the National Health Policy is to bring about a

comprehensive health care system, based on primary health care that is

• promotive

• protective

• preventive

• restorative and

• rehabilitative

There is a three-tier system of health care, namely: Primary Health Care,

Secondary Health Care, and Tertiary Health Care.

• Primary Health Care

• Secondary Health Care

19
 • Tertiary Health Care

(http://www.motherlaigeria.com/health.htmlndn)

VII. Language:

There are more than 500 language in Nigeria, which are spoken by

different tribes and groups. Though English is the official language of

Nigeria, yet more than 50% of the people of Nigeria can not speak in it. It is

commonly used for conducting official affairs.

The most popular local Nigerian languages are Yoruba, Edo, Igbo, Hausa-

Fulani, Tiv, Kanuri, Ibibio. Among these the North Nigerian languages are

Kanuri, Tiv and Hausa while the languages spoken in Southern part of

Nigeria are Igbo, Edo, Yoruba and Ibibio.

Executive Summary:

Full name: The Federal Republic of Nigeria

Population: 154.7 million (UN, 2009)

Capital: Abuja

Largest city: Lagos

20
Area: 923,768 sq km (356,669 sq miles)

Major languages: English (official), Yoruba, Ibo, Hausa

Major religions: Islam, Christianity, indigenous beliefs

Life expectancy: 47 years (men), 48 years (women) (UN)

Monetary unit: 1 Nigerian naira = 100 kobo

Main exports: Petroleum, petroleum products, cocoa, rubber

GNI per capita: US $1,160 (World Bank, 2008)

Internet domain: .ng

International dialling code: +234

President: Goodluck Jonathan

Goodluck Jonathan was sworn in as president when his predecessor, Umaru

Yar'Adua, died after a long period of illness in May 2010.

Mr Jonathan, elected along with Mr Yar'Adua as his vice-president in 2007, had

already been appointed temporary acting president by parliament in February

2010, after lengthy political wrangling.

Nigeria's media scene is one of the most vibrant in Africa. State radio and TV

have near-national coverage and operate at federal and regional levels. All 36

states run their own radios, and most of them operate TV stations.

Press:

The Guardian - influential, privately-owned national daily

The Champion - Lagos-based daily

21
The Daily Times - Lagos-based government daily

The Punch - privately-owned daily

New Nigerian - government daily, separate editions in Lagos and Kaduna

The Daily Independent - Lagos State-based daily

Daily Trust - Abuja-based daily

Leadership - Abuja-based daily

Vanguard - Lagos-based, widely-read daily

This Day - widely-read Lagos-based daily

The Daily Sun - Lagos-based

Economic Analysis:
1.Introduction:

• The Nigerian economy is one of the most developed economies in

Africa. According to the UN classification, Nigeria is a middle-income

nation with developed financial, communication and transport sectors.

It has the second largest stock exchange in the continent.

The petroleum industry is central to the Nigerian economic profile. It is

the 12th largest producer of petroleum products in the world. The

industry accounts for almost 80% of the GDP share and above 90% of

the total exports. Outside the petroleum sector, the Nigerian economy is

highly amorphous and lacks basic infrastructure. Several failed efforts

22
 have been made after 1990 to develop other industrial sectors.

(Source: CIA World Factbook)

The country ranks 151 out of 177 on the UN Development Index. During

2003-07, the government initiated strategic economic reforms to

eradicate poverty and bring economic

(equalityhttp://www.economywatch.com/world_economy/nigeria/)

Population:

a. Total:

The population of Nigeria in 2003 was estimated by the United Nations at

124,009,000, which placed it as number 10 in population among the 193

nations of the world. It is the most populated country in Africa. In 2003

approximately 3% of the population was over 65 years of age, with

another 44% of the population under 15 years of age. There were 101

males for every 100 females in the country in 2003. According to the UN,

the annual population growth rate for 2000–2005 is 2.53%, with the

projected population for the year 2015 at 161,726,000. The population

density in 2002 was 141 per sq km (364 per sq mi). Regional differences

are significant; population is densest in the south and sparsest in the

north.

23
b.Distribution of population: Nigeria is a plural or multinational

state, with 250 ethnic or nationality groups. The most populous and

politically influential of the nationality groups include the Hausa-Fulani

(29 percent) in the north, the Yoruba (21 percent) in the southwest,

the Igbo (18 percent) in the southeast, and the Ijaw (10 percent) in

the Niger Delta. In the year 2000, nearly 25 percent of the Nigerian

population were urban dwellers. At least 24 cities have populations of

more than 100,000. Lagos, the largest city, had a population of 9.8

million in 1995, 12.5 million in 2000, and is projected to have a

population of 25 million in 2015.

24
 c. Economic statistics and activities:

GDP (purchasing power parity):

$353.2 billion (2009 est.)

$340.3 billion (2008 est.)

$323.1 billion (2007 est.)

note: data are in 2009 US dollars

[see also: GDP (purchasing power parity) country ranks ]

GDP (official exchange rate):

$165.4 billion (2009 est.)

[see also: GDP (official exchange rate) country ranks ]

GDP - real growth rate:

3.8% (2009 est.)

5.3% (2008 est.)

6.4% (2007 est.)

[see also: GDP - real growth rate country ranks ]

GDP - per capita (PPP):

$2,400 (2009 est.)

$2,300 (2008 est.

25
a. Distribution of wealth: The Office of Statistics indicated that

GDP grew 6.0 percent annually (adjusted for inflation) between FY

(fiscal year) 1959 and FY 1967. GDP shrank at an inflation-adjusted

annual rate of 1.1 percent between FY 1967 (which ended two months

before the secession of the Eastern Region) and FY 1970 (which ended

three months after the war).

(http://countrystudies.us/nigeria/55.htm)

b. Minerals and resources:

Kogi state is rich in mineral resources .Most of these minerals are

avaliable in commercial quantities and these include coal at KotonKarfe,

Okaba and Ogboyaga; limestone and marble at Jakura, Ososo,

Ajackuta, Osara, Ekinrin Adde and ltobe; kaolin at Agbaja and iron ore

at Agbaja plateau and Itakpe hills.

Coal was mined here during the Nigerian civil war; limestone and

marble are exploited at Jakura and iron ore at Itakpe hills. Other

minerals include feldspar at Okene and Osara; clay, cassiterite,

columbite and tantalite at Egbe; gold at Isanlu, gems, quartz, mica and

crude oil at Idah

26
 (http://www.onlinenigeria.com/links/kebbiadv.asp?blurb=309)

c. Surface transportation: There are a number of

different ways to travel by land.

One way is by road, and the methods by which road

can be traveled include cars (commonly called motto),

buses, taxi cabs, bicycles, motorcycles, etc. Also, I

believe animals are used in certain parts of the

country, like horses, etc.

The other main way is by railroad. There are over 3500

km of railway. The main routes run from Lagos to Kano,

Porta Harcourt to Maiduguri, Zaria to Gusau and Kaura

Namoda.

The most popular international airport is the Murtala-Muhammed airport

in Lagos (Airport Code: LOS). There are other international airports in

Kano (Airport Code: KAN) and Abuja (Airport Code: ABV).

(http://www.motherlandnigeria.com/transportation.html)

27
 d. Communication system: Computing and

Telecommunications is Nigeria’s fastest growing

sector. With the advent of Global System of Mobile

Communication (GSM), the springing up of social,

educational and commercial activities driven by ICT

and the increasing awareness of Information and

Communications Technologies (ICT), ICT is on the rise

in Nigeria.

e.Working conditions:

Nigeria had an estimated labor force of 42.844 million in 1999. Women

comprised 36 percent of that force, which included talented and well-

educated entrepreneurs. Conditions for workers in Nigeria are far from

ideal. Civil servants and employees of private companies (foreign) have

relatively good offices and facilities, health care, and wages, but that is

not the case for most of the others. Conditions in the pre-collegiate

schools and the universities have deteriorated markedly because of

repression, underfunding, and irregular payment of salaries.

28
(http://www.nationsencyclopedia.com/economies/Africa/Nigeria-

WORKING-CONDITIONS.html)

29
e.Principal industries:

• Since oil was discovered in the wilderness of Nigeria, it became

one of the biggest oil exporters in the World. The Agriculture

industry is also highly prominent in Nigeria as most of its people

are traditionally farmers. The cities of Lagos, kano and Onitsha are

the homes of several industries like the Cotton, Textile, Garment

manufacturing as well as the Leather industry which thrive in these

cities Foreign investments: In 1992, the Nigerian Free Zone Act

was passed establishing the Nigerian Export Processing Zone

Authority (NEPZA.

a. International trade statistics:

Exports

Oil and natural gas are the most important export products for Nigerian

trade. The country exports approximately 2.327 million barrels per day,

according to the 2007 figures. In terms of total oil exports, Nigeria ranks

8th in the world. According to the 2009 figures, the country’s total export

volumes stand at US$45.43 billion. Major items of export are oil products,

30
cocoa and timber. The UK and the US are the largest trade partners for

Nigerian exports.

31
Imports

The United States is the largest foreign investor in Nigeria. The stock of

U.S. foreign direct investment (FDI) in Nigeria in 2006 was $339 million,

down from $2 billion in 2004. U.S. FDI in Nigeria is concentrated largely

in the petroleum/mining and wholesale trade sectors. Exxon-Mobil and

Chevron are the two largest U.S. corporate players in offshore oil and gas

production.

A large portion of the imports arrive from the EU, particularly the

Netherlands, the UK, France and Germany. China, the US and South

Korea are also major import trade partners.

b. Exchange rates

nairas (NGN) per US dollar - 150.48 (2009), 117.8 (2008), 127.46

(2007), 127.38 (2006), 132.59 (2005)

Trade restrictions: The federal government levies customs duties on

most imports, but these duties were substantially reduced in 1986 and in

1995. The import duty varies from 5% to 60%, averaging 12%. All

imports are also subject to a 7% port surcharge and a 5% value-added

tax (VAT). The paperwork necessary for exporting and importing is

lengthy. The taxation system has been widely avoided and valuations

are arbitrary.
32
c. Extent of economic activities not included in cash income

activities

d. Labor force:

• Labor force:

47.33 million (2009 est.)

[see also: Labor force country ranks ]

• Labor force - by occupation:

agriculture: 70%

[see also: Labor force - by occupation - agriculture country ranks ]

industry: 10%

[see also: Labor force - by occupation - industry country ranks ]

services: 20% (1999 est.)

[see also: Labor force - by occupation - services country ranks ]

• Unemployment rate:

4.9% (2007 est.).

a. Inflation rates:

• Inflation rate (consumer prices):

11.5% (2009 est.)

• 11.6% (2008 est.)

33
 I. Development in science and technology:

• It is on record that the electronic digital computer made its first

appearance in Nigeria in 1963, in connection with the analysis of

the 1962/63 national census data.

( http://www.unu.edu/unupress/unupbooks/uu19ie/uu19ie0e.htm

#2.) growth of information technology

• Nigeria has launched three satellites into space. The first satellite,

the Nigeriasat-1, was launched from Russia on 27 September

2003. Nigeriasat-1 is part of the world-wide Disaster Monitoring

Constellation System.

• Nigeriasat-2, Nigeria's second satellite, is a high-resolution earth

satellite built by a United Kingdom-based satellite technology

company, Surrey Space Technology Limited.

I. Channels of distribution:

II.

a. Retailers: The formal retail sector of the Nigerian economy is

small and under-developed, but growing fast.

Between 2001 and 2004 the retail sector of the Nigerian economy

34
 grew by 10% per annum. By 2006 the combined contribution to gross

domestic product of the retail, wholesale and hospitality industries

was 15%.Most Nigerians shop at markets or purchase their goods

from traders and street vendors but city and state governments are

seeing the tax benefits of more formalized trading. Lagos is at the

forefront in building shopping malls. The Lagos City Mall is a well-

established complex while the Silver bird Galleria, completed in 2004,

offers the city’s only multi-cinema complex.

Some of the shopping malls in Nigeria:

 Palms Shopping Mall, Lagos

 SilverBird Galleria

 Lafayette Mall

 Lagos City Mall

 William Dokpesi Store

 My Blue Store Nigeria, Online store www.mybluestoreng.com
 Popping Tags Online Boutique, Online store www.poppintags.com

 Ceddi Plaza

 Shashilga Seven

 MyBlueStore

Nigeria www.mybluestoreng.biz, www.mybluestoreng.com

 Popping Tags Online Boutique, Online store www.poppintags.com

35
  Tinapa City Resort Emporiums

Marketing Plan:

A. Marketing objectives:

1. Target markets: we are the manufacturers of sports watches and

Nigeria is going to be a tough target for us. We want to target a market

which is not been targeted before. World has now come to know the athletic

and sport potential of Nigeria. It has grown and improved in past few years

tremendously. Taking this point under the consideration, we, Oron Watches,

are going to target the potential youth. Every person interested in sports

and wants to play in times, is our target market.

Geographically we would be targeting the main cities like Abuja (capital of

the country), Lagos & Enugu. These are the most populous cities and of

course crowd of athletes come from these cities only.

Beside these cities we will be targeting students of universities and colleges

in Nigeria.

2. Expected sales year : 10,000 *1200 = 1,20,00,000 INR

3. Profit expectation year: 360 * 10,000 = 36,00,000 INR

36
B. Market penetration & coverage: the market penetration or entry

strategy would be “strategic alliance”. It will provide us enormous scope to

enter and expand into the Nigerian market. Our ultimate goal is to leverage

critical capabilities, increase the flow of innovation and increase flexibility to

respond the demand and technological revolution around the country.

B.Product adaptation or modifications

1. Core component: we are watch manufacturers. Our core component

would be high quality steel. We are making water resistant, heat resistant

sport watches. We would be installing Gps tracking system in the metallic

dial with plastic acrylic mirror sheets.The bimetallic temperature

compensated balance wheel would be made obsolete by the discovery of

low temperature coefficient alloys invar and elinvar. A balance wheel of

invar with a spring of elinvar was almost unaffected by temperature

changes, so it replaced the complicated temperature compensated balance.

2. Packaging component: we are into contract with Nigerian based

packaging company who will take care of entire packaging procedure.

3. Thrifty square boxes would be used while transporting

C. Promotion mix

1. Advertising: We have planned our advertising based on the target

market. We have dedicated 1.7 lakh INR for advertising only. Our product is

for sportive youngsters, so we are going to advertise using print media and

electronic media both.

37
We would be advertising our watches in newspapers like” daily trust”, and

“leadership” both are published from capital Abuja. Magazines for

advertisement would be “Crystal Magazine” published from Abuja and few

other magazines like “Celebrity” & “City People”.

When it comes to electronic media, we would be showing our advertisement

on Nigerian radio and Television. The language of communication would be

English.

2. Sales promotions: As our product is a product for sports, we will

promote our brand through various Competitions of football and other

athletics. We will be organizing a mega sport event in capital Abuja to

introduce the brand.

3. Personal selling: yes, personal selling would be done on an extent but

we are not more focused on push strategy. As we are positioning our

product as a high quality trusted brand, we just can’t give more emphasis on

personally convincing the target audience.

4. Other promotional methods: other promotional method would include

public relation. We will be appointing PR manager in Oron head office, Abuja

who will take care of the brand promotions.

Distribution: from origin to destination:

Port selection: The origin port for shipment would be Mumbai destined

to port of Lagos. This is the easiest way to carry the products.

38
Mode selection: there are various modes like railroad, air carriers,

ocean carriers and motor carriers. But we have chosen ocean carriers

taking the following points under the consideration:

Advantages of ocean carriers:

• They are the most reliable carriers.

• They are speedy enough for the carriage of products.

• Ocean carriers are cost effective and reduce transportation cost.

(http://www.tradecarview.com/ship/oceancarriers.aspx)

Disadvantages of ocean carriers: The only disadvantage with ocean

carrier is that it is at risk. If something goes wrong with the climate or

ocean, there may be very high damage to the ship and products kept

inside.

Naturally speaking, risk factor is attached with every aspect now a days,

but entrepreneurship demands risk taking ability, so we don’t mind

opting for ocean carriers.

Packing: The basic principle of packaging is known as the "unit load'

concept or "unitization." Unitization is based upon the theory that all

shippers should pack their cargo so it may be moved and handled

39
entirely by mechanical equipment, such as lifts and cranes, throughout

the distribution network. As per unitization, our watches would be

enclosed in triple wall containers to avoid damage. Second, the boxes or

containers should be secured to four ways entry pallets cushioned with

shrink-wrap or steel strapping.

(http://www.susta.org/export/packingetc.html)

Marking and labeling regulations: Markings has to be done to a

minimum. Trademarks or product descriptions should not be added to

the box. Marks should be applied with waterproof ink to three surfaces of

the container. Cautionary markings should be in English, the language of

the country of destination and the international graphic-handling symbol.

Containerization: the containerized type is when the product is loaded

into containers and moved from door-to-door without the contents being

handled. It is the most common method used to transport high-value or

value-added agricultural exports.

Cost: The shipping cost from India to Lagos, Nigeria is approximately

675 INR (i.e. 15 $) per cubic foot.

(http://uboxworldwide.com/international-shipping/nigeria/)

4 . Documents Required:

40
1 . Bill of Lading: A bill of lading is a type of document that is used to

acknowledge the receipt of a shipment of goods. A transportation

company or carrier issues this document to a shipper. In addition to

acknowledging the receipt of goods, a bill of lading indicates the

particular vessel on which the goods have been placed, their intended

destination, and the terms for transporting the shipment to its final

destination.

(http://www.wisegeek.com/what-is-a-bill-of-lading.htm)

2 . Dock Receipt: we will be forwarding our products through Great

Eastern shipping company, Mumbai. This receipt will be given by

shipping company to acknowledge that goods have been received for

shipment. Dock receipt transfers the accountability for the safe custody

of the cargo from the shipper to the carrier, and serves as the basis for

preparing the bill of lading

(http://www.businessdictionary.com/definition/dock-

receipt.html#ixzz11tKOFz4w)

3 . Commercial Invoice: Document required by customs to determine

true value of the imported goods, for assessment of duties and taxes. A

commercial invoice (in addition to other information), must identify the

buyer and seller, and clearly indicate the

41
(1) date and terms of sale,

(2) quantity, weight and/or volume of the shipment,

(3) type of packaging,

(4) complete description of goods,

(5) unit value and total value, and

(6)insurance,shipping and other charges (as applicable).

(http://www.businessdictionary.com/definition/commercial-

invoice.html#ixzz11tL66zDx)

4 . Pro forma invoice: Abridged or estimated invoice sent by a seller to

a buyer in advance of a shipment or delivery of goods. It notes the kind

and quantity of goods, their value, and other important information such

as weight and transportation charges. Pro forma invoices are commonly

used as preliminary invoices with a quotation, or for customs purposes in

importation.

(http://www.businessdictionary.com/definition/pro-forma-

invoice.html#ixzz11tLYBc66)

5 . shipper’s export declaration: Shipper's Export Declaration (SED)

filing is generally required by the U.S. Census Bureau for U.S. exports
42
that contain a single commodity's value exceeding US$2,500.00. All SED

information is provided to the U.S. Census Bureau and is used for export

compliance and governmental reporting.

(https://www.ups.com/content/us/en/shipping/international/documents/in

tl_forms/declaration.htm)

6 . Statement of origin: The manufacturer's statement of origin, also

known as the manufacturer's certificate of origin, certifies the country

where goods were made. It is one of many documents that may be

involved with the import and export of manufactured products.

The Definition of Manufacturer's Statement of Origin | eHow.com

(http://www.ehow.com/facts_6850703_definition-manufacturer_s-

statement-origin.html#ixzz11tMLmvrn)

5 . Insurance claims: Many of the issues surrounding shipping

insurance come to bear either before you actually ship the item in

question or while you’re standing at the counter and/or filling out

necessary forms (online or not) to ship it. Here are some of the most

important.

1 . Pack well for shipment

2 . Take a photo of your packaging before you ship

43
3 . Buy as much insurance as the item is actually worth.

4 . Use a traceable shipment method

5 . Keep all shipping documentation

6 . Making a Claim

(http://ebay.about.com/od/shippingitems/qt/ct_insurance.htm)

6 . Freight forwarder: Freight forwarding is a service used by

companies that deal in international or multi-national import and export.

While the freight forwarder doesn't actually move the freight itself, it

acts as an intermediary between the client and various transportation

services. Sending products from one international destination to another

can involve a multitude of carriers, requirements and legalities. A freight

forwarding service handles the considerable logistics of this task for the

client, relieving what would otherwise be a formidable burden.

(http://www.wisegeek.com/what-is-freight-forwarding.htm)

E . Channels of Distribution

Products delivered at port are carried to various retail outlets

through road transport. Wholesalers distribute to other retail outlets to

44
various cities through road transport. Cost incurred to transport the

product to the retail outlets is included Maximum Retail Price (MRP).

1. Retailers.

a) There are 7 shopping malls in Nigeria and each shopping mall

consists of one retail outlets. There are nine distributors who

distribute the product to 3 cities of Nigeria.

b) Each retail outlets will be earning 2263 Naira per watch. Other

retail chains in the city will be earning 342 Naira per watch.

c) Transaction will be in cash as well as credit. Credit period for

wholesaler is 30 days.

2. Wholesale and Middlemen.

a) There are 9 wholesalers for the product who will distribute to 3

main cities of Nigeria.

b) Each distributor will earn 684 Naira for each watch.

c) Transaction will be in cash as well as credit. Credit period for

wholesaler is 30 days.

d) Scale of operation will be in large.

3. Import/export agents.

45
We have already made a contract with Great Eastern shipping Co.

Mumbai which will be taking care our reliable agent for exporting our

product.

4. Warehouse

We have our mother warehouse in destination port which is Lagos and

the daughter warehouse is at capital city of Nigeria- Abuja, rest of

warehousing would be taken care by the wholesalers themselves.

46
 F . Price Determination:

1. Cost of the shipment of goods

According to standard of Indian shipping they charge 15 dollars that is

675 approx Indian Rupees per cubic foot. So including all charges of

shipment from Indian port to Nigerian port would be Rs. 4, 00,000.

The cost of transportation and handling expenses (which includes

carriage charges and freight) will be included in the same.

2. Insurance costs

Our product is insured with Oriental Insurance company and the

amount charge by them is Rs. 3, 00,000.

3. Custom duty

As per Indian government law we are paying 20% custom duty on our

product which is Rs-36, 07,499

5. Value added tax

As per Indian government law we are paying 5% Value added tax

(VAT) for our product which is Rs-9, 01,875.

47
 6. Discounts

Discounts will be given only in retail outlets and the discount strategy

would depend upon strategies of competitors.

7. Company gross margin

As per the expected sale for the first year that us 10000 units our

profit is expected to be Rs.3, 600,000 (price for one unit is Rs 1200)

8. Retail Price.

Maximum Retail Price is Rs- 1500.

G . Terms of Sale:

1 . EX works: Term of sale signifying that the price invoiced or quoted

by a seller includes charges only up to the seller's factory or premises.

All charges from there on are to be borne by the buyer

(http://www.businessdictionary.com/definition/ex-

works.html#ixzz11tl69TuN)

Ex Works pricing is also more accurate as an indicator of the product's

price in any region as seller’s perception of the local price of that product

is not affected by the transportation cost.

48
EX WORKS or EXW is buying based on a price quoted to a buyer without

transportation or delivery to his/her site. It just means he buys at a price

where the manufacturer has the limited duty for producing and placing

the finished goods at his factory or warehouse, and then the buyer

collects it with his own transporter.

(http://ezinearticles.com/?What-is-Ex-Works?&id=1866174)

FOB: A trade term requiring the seller to deliver goods on board a vessel

designated by the buyer. The seller fulfills its obligations to deliver when

the goods have passed over the ship's rail.

When used in trade terms, the word "free" means the seller has an

obligation to deliver goods to a named place for transfer to a carrier.

(http://www.investopedia.com/terms/f/fob.asp)

Here, the buyer has to bear all the costs and risks of damage or loss to

the goods from that point. The FOB term requires the seller to clear the

goods for export. This term can be used only for sea or inland water way

transport.

(http://www.iccwbo.org/incoterms/preambles/pdf/FOB.pdf)

FAS:

49
C & F: Term of sale signifying that the price invoiced or quoted by a

seller for a shipment does not include insurance charges, but includes all

expenses up to a named port of destination. In comparison, carriage paid

to (CPT) terms include all transport charges (but not insurance) up to a

named place (usually the buyer's warehouse) of destination.

(http://www.businessdictionary.com/definition/cost-and-freight-C-

F.html#ixzz11tqnFWoy)

Seller owns goods until they are loaded on vessel; selling price includes

all costs so far plus cost of ocean freight.

(http://www.lectlaw.com/def/c001.html)

CIF: Cost, Insurance and Freight (-named port of destination) It is most

frequently used term in export transactions and includes FOB price plus

cost of ocean freight and marine insurance, upto the port of destination.

In C.I.F. quotation, care must be taken to state the name of port to which

the goods are intended to be shipped. However, if the “CIF price is

applicable all over the world, the quotation should be “CIF Main Port”. CIF

does not, however, include any charges for unloading the goods or for

import duties, if any, in the country of importation.

(http://www.eximkey.com/copycon/disparch.asp?archid=425)

50
 Methods of payment

As we are entering the market for the first time we have adopted

comfortable methods of payment. Taking Nigeria economy under the

consideration we would offer cash in advance, open accounts and letter of

credit methods of payment.

Marketing Budget

Advertising and promotion expense

As we are advertising our product through various print media such as

newspapers, magazines etc; television channels of Nigeria (national

channel) and also through various FM radio channels. As we are entering the

market for the first time various sales promotion activities are also done

along with the sale of the product. So total expense incurred for advertising

and sales promotion is Rs 17,500,000.

Distribution expense

As wholesalers would be distributing the product to various retailers the

entire distributing charges would be born by the wholesaler itself. There are

9 wholesalers who are going to distribute the product to different retail

outlets.

Product cost

Raw material Price (RS.) Quantity Total (RS)

Gps tracking system 135 per 50000 64,50,000

51
 machine

Plastic acrylic mirror 80 per sq. ft 30000 sq. Ft 24,00,000

sheets

metal 180 per kg. 3000 kg 5,40,000

Packing material 30 per case 50000 cases 15,00,000

(contract )

Export packaging (Thrifty 42 per box 50000 box 21,00,000

Square Box)

Labour 50 per unit 50,000 25,00,000

Production 50,000

watches(weight is 90

grams per watch)

Total 1,54,90,000

Other cost

Our vision is to provide a time piece to every person who wants to play. We are

pioneer to take initiative of building a brand in the economy like Nigeria. To

provide more credibility, trust and access to Oron watches we need to make our

own official website. Oron is taking care of its customers in both the market

either physical or online. Our official website is www.oronwatches.com

Other cost also include maintenance cost which cost Rs-12, 00,751

52
 Profit and loss account for first year i.e., 2010-11

Particulars Amount(in Particulars Amount(i

Rs) n Rs)

By Opening stock 42000000 To sales (10000 units of 12000000

(50000 units of Rs 840) Rs 1200)

30000000
To gross loss c/d

42000000 42000000

Profit and loss account for the fifth year

Particulars Amount (in Particulars Amount(

Rs) in Rs)

By Opening 42000000 To sales (50000 units of 6000000

stock(50000 units of Rs Rs 1200) 0
840)

18000000
By Gross profit c/d

60000000
6000000
0

53
III. Resources requirements:

1. Finances: We, Oron watch Corporation has got budget of 5 crore INR.

The distribution of finances has taken place as follows:

A. The major portion of total amount i.e. approximately 4.2 crore INR is

apportioned right from manufacturing till distribution up to the retail

stores.

B. The second big portion is for the events and promotions of the brand.

We have apportioned 50 lakh INR for mega sport events in Abuja &

Lagos.

C. Remaining 20 lakh INR are specially for CSR activities. We believe in

philanthropy. We believe in being good, doing good and getting good.

Finally, we understand our social responsibilities.

2. Personnel: Oron Watch Corporation believes in people working for it.

We have seven outlets at seven shopping malls in the cities of Abuja,

Lagos and Enugu. Each outlet will have 1 store manager, 2 technicians

and 3 salesmen. The employees are part of us and we believe in

excellence. They all will be well trained and equipped with best selling

skills.

3. Production Capacity: Our production capacity is 50,000 units for

now. We hope, it will increase with time and our progress. We are

54
hopeful we would be able to win the trust of our customers and print our

brand image in their minds.

Executive Summary: We, Oron watch corporation started our

company with the fortune of 5 crorore INR only. Our expertise lies in our

technology. And we specialize in sports watches. We analyzed and

studied the entire global market. And we came to know that on one end,

it is highly diversified and varied. There is lots of competition, still so

much demand. To make our concept more clear we did a SWOT analysis

of it;

55
SWOT Analysis:-

Strengths: We can say that there is lots of demand available for the

products and services both. If you are expert and specialize in

something, then there is lots of scope. There are international players in

the market and it makes you too standardize your product up to that

bench mark.

Weakness: the weakness of international market can be said it

demanding atmosphere. If certain player is not diversified or specialized,

then market won’t accept it.

Opportunities: international market has tremendous opportunities for

every sector and product. There is lots of scope for innovation and

uniqueness. There is tough competition and every product has to be very

competent to survive in the market. This nature of market not only

welcomes the new entrants but help them flourish.

Threat: the only threat of the international market is its diverse nature.

Besides all these factors, international marketing is exciting enough and

we decided to take risk to enter. We searched for the target audience is

every youngster which is sportive. We found Nigeria a good market. We

went through a short survey of Nigeria and we found following facts:

56
Oil-rich Nigeria, long hobbled by political instability, corruption,

inadequate infrastructure, and poor macroeconomic management, has

undertaken several reforms over the past decade. Nigeria's former

military rulers failed to diversify the economy away from its

overdependence on the capital-intensive oil sector, which provides 95%

of foreign exchange earnings and about 80% of budgetary revenues..

Since 2008 the government has begun showing the political will to

implement the market-oriented reforms urged by the IMF, such as to

modernize the banking system, to curb inflation by blocking excessive

wage demands, and to resolve regional disputes over the distribution of

earnings from the oil industry. In 2003, the government began

deregulating fuel prices, announced the privatization of the country's

four oil refineries, and instituted the National Economic Empowerment

Development Strategy, a domestically designed and run program

modeled on the IMF's Poverty Reduction and Growth Facility for fiscal

and monetary management. In November 2005, Abuja won Paris Club

approval for a debt-relief deal that eliminated $18 billion of debt in

exchange for $12 billion in payments - a total package worth $30 billion

of Nigeria's total $37 billion external debt. The deal requires Nigeria to

be subject to stringent IMF reviews. Based largely on increased oil

exports and high global crude prices, GDP rose strongly in 2007 and

2008, and less strongly in 2009. President YAR'ADUA has pledged to

57
continue the economic reforms of his predecessor with emphasis on

infrastructure improvements. Infrastructure is the main impediment to

growth. The government is working toward developing stronger public-

private partnerships for electricity and roads.

Taking these points under then considerations, we are launching our

first Oron Sports Watch in Nigeria. It has got following features:

• High-Sensitivity, Watch-Like GPS Receiver That Provides

Exceptional Signal Reception

• 1 Piece Training Assistant That Provides Athletes With

Precise Speed, Distance & Pace Data

• Includes Training Center Software, Which Allows Users To

Download Workout Data For A Detailed Analysis

• Used For Multiple Sports Such As Cycling, Cross- Country

Skiing & Windsurfing.

• (http://gadgetophilia.com/top-10-sports-watch/)

Our Brand Logo:

Our brand tagline: time in your hand!

58
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63