CASE STUDY PRESENTATION

PRESENTED BY –
RASHMI VARSHNEY
RITIKA SINGH
RUPAL GUPTA
SANCHITA NAMDEV
SUMMARY
Full Moon Children Ltd.(FMCL) is a newly formed joint venture in India, who deals with
children schools accessories .American Toys Inc.(ATI) and Vandan education Ltd.(VEL)
are equal partners in this venture. They had spent huge amount on advertisement. A latest
market survey, shows that FMCL and its product have got very good visibility in urban and
semi-urban markets. But the demand is not that much rising.
Mr. Peter Wood , Director- Marketing and Mr. Sripad, VP-
Marketing had many sittings with their managers, to discuss strategies that would boost
sales. Mr. Sripad suggested that FMCL should offer hefty discount to customers. He further
stated that Indian consumer are not used to spend more on children accessories. Mr. Wood
was absolutely against the concept of heftily discounts and price distortions . It would led
to an unnecessary price war . Sripad didn’t agree with Mr. Wood as he strongly believed
that ,modern business is like a battle and had to be fought ruthlessly They both decided to
discuss their views with Mr. Brown , Managing director of FMCL. Mr. Wood further
suggested that Mr. Prasad finance controller should also join their discussion . When all the
4 executives met for their brain storming sessions . Mr. Prasad told that FMCL cost ratios
were already under pressure so any further discounts would give us burden . Mr. Brown
also agreed the same. He also agreed with Mr. Sripad that “ Concept Sale” has to be tried
out , the company should organize product awareness programs as modern educational
programs Mr. Brown also agreed the same. He came out with an idea that the company
products should be offered as free to the teachers. . Mr. Sripad was not sure of this strategy
but he stated that business is business and therefore any workable idea should be
welcomed.
PROBLEM IDENTIFIED
Problem in FMCL – Sales decline

REASONS
The demand of the product is not shooting up as it covers only urban and semi-urban
areas
Due to heavy expenses on advertisements the company was still not able to reach the
mind of consumers .
High price of the products .
Offering heftily discounts .
Less awareness of Indian consumer to spend on their children's school accessories .
SUGGESTIONS
They need to cover rural areas as well as urban areas too.
Advertisement expenses should be kept appropriate.
Price should be kept moderate and affordable for the consumers, especially
rural people because 70% of the India population is covered by the rural
areas.
Free sampling .
Discount should be given up to certain limits so that they can easily cover
their profit.
BEST ALTERNATIVE
Price rate of the product should be minimized so that all the
consumers can easily afford it so that it will ultimately increase in the
sales of the company.
PORTER’S 5 FORCES MODEL
COMPETITIVE RIVALRY
New competitors may be a threat, but there is also the constant threat of existing
competition. It also depends on market position and consumer perception. In this case
the problem is price, if they want to sustain in market they need to maintain their price
which helps to reduce the competition.
SUPPLIER POWER
They have certain level of power over the company based on pricing and term of
supply. FMCL was providing a huge discount and the price is high so if they want to
sustain they need to manage their discount and their price.

BUYER’S BARGAINING POWER

Buyers have more bargaining power , when there is high supply then demand for a
product in the market place. This allows buyers to pressure companies to offer higher
quality at low prices.
THREATS OF SUBSTITUTE
In any market there will be a substitute product . If FMCL wants to increase their sale,
they need to maintain their price as compare to another product .

NEW ENTRANCE
As FMCL is a new venture company so they should maintain their pricing policy as
there is a huge competition among the new entrance in the market. So FMCL should
maintain their price to sustain among the new entrant available in the market.