MARKETING MANAGEMENT - 1

VANRAJ TRACTORS

CASE ANALYSIS NOTE

GROUP 10, SECTION E

Submitted By:
Anuprasanth – PGP/20/260
Jhawar Pratiksha Ghanshyam - PGP/20/270
Nishi Ranjan Tarai – PGP/20/280
Rupali – PGP/20/290
Thaithoilung Thaimei – PGP/20/300
Ankur Sharma – PGP/20/370
 VANRAJ TRACTORS

Introduction
Vanraj was the name of a Mini-Tractor of horsepower manufactured by M/s
Pramal Farmatics Pvt. Ltd. Trivedi, one of the three partners of M/s Pramal
Farmatics Pvt. Ltd., was confident about the success of Vanraj. The Central
Farm Machinery Testing and Training institute has awarded Central Motor
Vehicle Rules compliance certificate to Vanraj. Trivedi had sent the circular
copies of the same to all district RTOs in Gujrat, Madhya Pradesh, Maharashtra
and Uttar Pradesh.

Segmentation
Trivedi had carefully analysed the market and arrived at the target segment fot
the Vanraj Mini Tractor. He had segment the market based on the following
parameters.

 Buyers
The first segmentation was based on the segment of people who will form
the prospective buyers. He had identified marginal and small farmers who
held less than 1 hectare land and 1 to 2 hectare land respectively. Since the
big and medium tractors are non-viable for this segment of farmers, mini-
tractor are the best choice for them. This can also be used in horticulture
farming and for material handling operations in industries, airports and
municipal corporations with few modifications.

 Region
The states Gujrat, Madhya Pradesh, Maharashtra and Uttar Pradesh has a
large number of marginal and small farmers and with annual sales of 17345,
 28443, 15288 and 54392 respectively. No big company ever tried to explore
the potential of mini-tractors in these states.

 Market

Vanraj was placed in less than 20 horse power mini-tractor segment which
accounted for less than 1% of total sales. There was also no big competition
for vanraj in the market.

Targeting
Trivedi’s main target was farmers who used bullocks for farming. Use of
bullocks was less efficient and costlier than using a tractor. Vanraj was not
only cheaper than other big tractors in the market, but was also nearly
three times less fuel consuming than them. All of them had the same life
span. The repair and maintenance cost was also less than that of the big
tractors. It also had the advantage of accessing small areas where the big
tractors cannot access. It was the only three wheel convertible tractor in
the industry and had all common farming implements. It also had the Power
take-off point which enabled the tractor’s engine to be used as a power
generator. The competitors were with the low quality assembled chassis
mounted engines and the Chinese tractors. Even though they were cheap,
the superior quality of Vanraj and its better features gave it an edge over its
competitors. India, with its third largest cropping area and world’s largest
market for tractors, had most of the land holdings in fragmented nature.
Subsistence and labour intensive farming methods were carried on. This
was the best market for vanraj. The availability of bank loan was also easier
for tractors due to government regulations and there was also a subsidy of
Rs. 30,000 for less than 30 HP tractors. Trivedi planned to sell the tractor for
0.19 million or even less given they outsource certain components in bulk
and derived economies of scale.