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BUSINESS RESEARCH

METHODS
TERM PAPER ON
STEEL PIPE MARKET VS PVC PIPE MARKET

UNDER THE AEGIS OF


PROF. ARVIND CHATURVEDI

BY

DINESH SHARMA
ROLL NO 9
KC SHAKDWIPEE
ROLL NO 14
PANKAJ G SACHDEV ROLL NO 25
3rd

SEMESTER
MBA E 2003-06 IIFT NEW DELHI

CONTENTS
SL NO

TITLE

PAGE NO

EXECUTIVE SUMMARY

INTRODUCTION

PIPE DEMAND

4.1

PROBLEM
IDENTIFICATION

4.2

RESEARCH
METHODOLOGY
SAMPLING PLAN

4.4

4.5.1

SECONDARY DATA &


ANALYSIS

4.6

PRIMARY DATA &


ANALYSIS

16

RESEARCH FINDINGS

25

CONCLUSION

26

QUESTIONNAIRE

27

EXECUTIVE SUMMARY
There was market feedback that PVC pipes are coming in a big way in the market
and taking away share of Steel pipe market .Management wanted to know the
real picture as about 2 lac mt steel was being consumed all over India by steel
pipe manufacturers.

Data of All India sales segment wise was compiled for sales of PVC PIPE and
STEEL PIPE FROM 2001-2004.Prices of pipe were also compared .The increase
in the price of steel pipe was quite steep compared to PVC pipe rate
increase.Moreover the PVC pipe was much lighter in weight compared to Steel
Pipe.Both these factors led to replacement of steel pipe by PVC pipe in some
appplications in agriculture segment ,infrastucture and housing segment.

People were not aware of the carcinogenic effects of PVC.Durability and price
were the major factors in customer deciding the use of PVC or Steel
pipe.Traditionaly steel pipes were being used in all sectors .But of late relative
market share of PVC is gradually increasing in all segments.
Due to constraints of time only nearby Delhi PVC pipe manufacturers who were
also producing steel pipes were contacted .These producers of pipes are
gradually increasing the capacity utilization of PVC Production .In steel pipes
production the same increase in capacity utilization is not there.
While for PVC Dealer Channel was predominantly used for steel pipes direct
marketing by producers to Government departments and Exports was utilized.
Sales of steel is not being immediately hit because of growth in steel pipe
consuming segments but in the long run steel manufacturers will have to explore
other potential user segments of steel .

2 INTRODUCTION
Steel is an alloy of iron and carbon containing less than 2% carbon and 1%
manganese and small amounts of silicon, phosphorus, sulphur and oxygen.
Steel is the most important engineering and construction material in the world. It
is used in every aspect of our lives, from automotive manufacture to construction
products, from steel toecaps for protective footwear to refrigerators and washing
machines and from cargo ships to the finest scalpel for hospital surgery.
IT IS WIDELY USED FOR PIPES.

More than 135 years ago, the first steel


pipe ever laid in America began
supplying water to the population of San
Francisco. This five mile long conduit-unlined, uncoated, and unwrapped--was
the first of millions of miles of pipe and
millions of tons of steel used to create
the infrastructure of America's water,
chemical, and petro-chemical distribution
and transmission infrastructure.
As a testament to steel's durability, this pipe is still in service today. With
considerable and ongoing improvements in the quality of mill steel,
fabrication technology, welding, linings, coatings, and cathodic protection
the combination of steel's strength, performance, and durability remains
unparalleled.
Steel is the world's most recycled material; indeed one of the two major steel
production techniques uses exclusively 100% recycled steel . Of the 960 million
tons of steel produced in 2003, more than 60% of it was produced from recycled
steel.. The properties of steel remain unchanged no matter how many times the
steel is recycled. The steel in car body might have been a panel from a washing
machine in a previous life and even that panel might have been a drink can!
Steel is produced in more than 50 countries worldwide and on every continent
except Antarctica.
Steel possesses greater durability and compared to other materials. Steel is a
material, which is very friendly to the environment. The problem with steel is the
corrosion which happens when steel comes into contact with water and oxygen,
there is a chemical reaction and the steel begins to change to its original form iron oxide. In most modern steel applications this problem is easily overcome by
coating. Paint is used in automobiles, enamel is used in refrigerators and other
domestic appliances and in other cases elements such as nickel and chromium

are added to make stainless steel, which can help prevent rust. Galvanizing is
done on pipes to prevent corrosion. Steel pipes are videly used in production of
oil and natural gas and in modern power stations .They use steel pipes as these
remain impermeable even at extreme temperatures of 580 degree C or 270
degree centigrade.

3. PIPE DEMAND
The demand for pipes is directly related with the performance of the economy
and the agriculture in particular.There is demand for irrigation pipes.The
housing sector is a big consumer of pipes.The interlinking of rivers,rural water
supply schemes and urban development measures contribute to demand of
pipes.Major schemes of the Central Government like Swajal Dhara Scheme,
AP s Govt drip irrigation project of Rs 11.2 Billion require massive quantity of
pipe.Lot of State Governments requirements are there in drinking water and
sanitation projects.Of late PVC pipes have come in the market which are light in
weight and much cheaper in price. Replacement of PVC in several critical
segments has been forecast.

A realistic appraisal of PVC Pipe was needed to properly assess its future in a variety
of applications in light of environmental pressures exerted over the past decade. It
may be noted here that some scientific studies have concluded that PVC causes
cancer, PVC compounding is done by weight, and compounds are formulated in parts
per hundred. Following is a list of ingredients in a typical Compound.

The above formulation contains a total of 135 parts by weight. The


percentage of calcium carbonate by weight is 30/135 or 22%. To
approximately convert this to percent volume, divide the percentage by
weight by two, since calcium carbonate has

approximately twice the specific gravity of PVC. Therefore, a 30 part per


hundred calcium carbonate compound contains approximately 11%
calcium carbonate by volume

4.RESEARCH
4.1)

PROBLEM IDENTIFICATION

SALES OF HR COIL(which is the primary material to manufacture steel pipe) to steel


pipe manufacturers was not matching the growth rate of pipe segment (PVC+STEEL
PIPE) which was growing very fast. The idea was to get a picture why it was so?
4.2)

RESEARCH OBJECTIVES:

1) STUDY THE ALL INDIA DEMAND OF PVC PIPE VS STEEL PIPE


2) To understand PARAMETERS THAT INFLUENCE PURCHASE DECISION OF
PIPE
3) FACTORS THAT INFLUENCE PURCHASE OF PIPES BY CUSTOMERS
4) BRAND PREFERENCE OF STEEL PIPE BY CUSTOMER
5) BRAND PREFERENCE OF PVC PIPE BY CUSTOMER
6) SEGMENT WISE SALES OF PVC VS STEEL PIPE
7) CHANNEL WISE SALES OF PVC VS STEEL PIPE
8) PRODUCTION OF PVC TUBE VS STEEL TUBE

4.3)TYPE OF RESEARCH:
It started with exploratory research and further descriptive research was done.

4.4)SAMPLING PLAN
Sampling Frame:
Industrial Directory of Manufacturers of both PVC Pipe
and Steel pipe .
Unit of analysis:
It was found from Industrial Directory that there are only
Three manufacturers of pipes around Delhi who manufacture both Steel and PVC pipes.
Sampling Method used.
STRATIFIED RANDOM SAMPLING

4.5) DATA COLLECTION


4.5.1

SECONDARY DATA

1. PERSONAL INTERVIEWS WITH TUBE MANUFACTURES ASSOCIATION


PRESIDENT
AND
SECRETARY GENERAL.
2. PERSONAL INTERVIEWS WITH
8 LEADING PIPE DEALERS IN
HAUZ QAZI NEW DELHI & PRESIDENT OF DELHI PIPE DEALERS
ASSOCIATION.
3. INTERNET SITES OF PIPE MANUFACTURERS.

ANALYSIS
Based on above the following data was arrived at after checking and cross checking
with above people.

TABLE 1

DEMAND IN INDIA FOR STEEL PIPES (MT)


SEGMENT

2001

2002

2003

2004 E

AGRICULTURE

427350

450000

500000

500000

NFRASTRUCTURE

341880

350000

400000

450000

HOUSING
OTHERS

512821
256410

550000
250000

600000
300000

630000
300000

TOTAL

1538461

AVERAGE PRICE PER


KG(Rs) BLACK
7 INCH BLACK
PIPE PRICE
AVERAGE PRICE PER
KG(Rs) GALVANIZED
7 INCH GALV
PIPE PRICE

1600000 1800000 1880000

18

17

26

31

1710

1615

2470

2945

22

21

30

35

2090

1995

2850

3325

%
GROWTH
IN 2004
OVER
2001
17
32
23
17
22
72
72
59
59

INFERENCE: FROM TABLE 1


There is overall growth of 22% in steel pipe demand in 2004 compared to 2001 demand.
The growth is highest in Infrastructure Sector 32% followed by housing and agriculture
sector.
8

The price of Black Pipe over the same period has increased by 72% while Galvanized
pipe price has increased by 59%.

TABLE 2

DEMAND IN INDIA FOR PVC PIPES (MT)


SEGMENT

2001

AGRICULTURE

301000

331000 364000 400400

INFRASTRUCTURE

125000

140000 150000 165000

HOUSING
OTHERS

185000
22500

200000 250000 275000


25000 36000 39600

TOTAL

633500

696000 800000 880000

AVERAGE PRICE
PER KG(Rs)
7 INCH PIPE PRICE

INFERENCE:

2002

2003 2004 E

48

50

50

55

1248

1300

1300

1430

FROM TABLE 2

There is overall growth of 39% in PVC pipe demand in 2004 compared to 2001 demand.
The growth is highest in Others Sector 76% followed by housing 49%, agriculture 33%
sector and infrastructure 32%.
The price of PVC pipe has increased by 15% over the same period.

INFERENCE:

FROM TABLE 1,2 & GRAPHS 1,2,3,4 & 5.

%
GROWTH
IN 2004
OVER
2001
33
32
49
76
39
15
15

As is evident from Graph 1 in agriculture sector if we take the total demand of pipe the
share of PVC pipe has increased compared to steel pipe .Similarly in infrastructure
housing ,and other sectors the share of PVC pipes has increased .A look at overall pipe
market Graph 5 shows that share of PVC PIPE is gradually increasing.
GRAPH 6
This graph highlights the weight advantage of PVC pipe compared to Steel pipe of same
dia.
GRAPH 1

AGRICULTURAL DEMAND OF
PVC PIPE VS STEEL PIPE IN MT
1000000
800000
600000
400000
200000
0
2001

2002

2003
STEEL

2004
PVC

GRAPH 2

10

INFRASTRUCTURE DEMAND OF
PVC PIPE VS STEEL PIPE IN MT
700000
600000
500000
400000
300000
200000
100000
0
2001

2002

2003

2004

STEEL PIPE

PVC PIPE

GRAPH3

HOUSING SECTOR DEMAND OF PVC PIPE


VS STEEL PIPE IN MT
1000000
900000
800000
700000
600000
500000
400000
300000
200000
100000
0
2001

2002

2003

STEEL PIPE

2004
PVC PIPE

11

GRAPH 4

OTHER SECTOR DEMAND OF


PVC VS STEEL PIPE IN MT
3000000
2500000
2000000
1500000
1000000
500000
0
2001

2002

2003
STEEL PIPE

2004
PVC PIPE

GRAPH 5 TOTAL DEMAND OF PVC


PIPE VS STEEL PIPE IN MT
400000
350000
300000
250000
200000
150000
100000
50000
0
2001

2002

2003

2004
12

STEEL PIPE

PVC PIPE

GRAPH 6

AVERAGE 7 INCH PIPE PRICE PER KG IN Rs

3500
3000
2500
2000
1500
1000
500
0
2001
PVC PIPE

2002

2003

BLACK STEEL PIPE

2004
GALV STEEL PIPE
13

GRAPH 7

WEIGHT ADVANTAGE
APPROX WEIGHT IN KG OF 1 Mtr PIPE OF 110 mm DIA

10

WEIGHT

PVC PIPE

1.7

GI STEEL PIPE

10

14

Following comparison was taken from internet site which solves the dilemma of a customer whether
to choose steel pipe or PVC pipe and advantages of steel pipe.

Choosing Between PVC Pipe and Steel Pipe


When choosing a piping material customers are often faced with many considerations
Here are some comparisons to use .
Strength

Distortion

Steel is stronger than PVC. It can resist minor collisions with forklift traffic better than PVC.
PVC is not as resistant to water hammer as steel.
PVC will distort or bend permanently if very hot temperatures are applied. PVC pipe must
not be used for water temperatures above 140 F. A special version of PVC called CPVC
must be used for higher temperatures.

Corrosion
Resistance

PVC will not rust, however, fittings, pumps or heat exchangers combined in a PVC system
can corrode and require a corrosion prevention program in the water treatment. New steel
piping can be cleaned and pacivated to minimize future corrosion with a treatment program.

Thermal
Conductivity
Thermal
Expansion

PVC has a lower thermal conductivity than steel and can reduce the need for insulation.

PVC pipe expands and contracts at 4.5 times the rate of steel (0.36" per 100 ft length at a
10F temperature differential). As a result the suspension system should be designed with
sliders to accommodate this movement. Expansion loops may also be required. 200 feet
of PVC pipe installed at 75F and operating at 50F will contract 2".

Fire
Resistance
Handling

Cost

Where pipes penetrate a fire rated wall, floor or ceiling assembly, PVC cannot be used.

PVC pipe is lighter than steel pipe and can reduce the need for heavy equipment lifts during
installation.
The installation costs for steel are higher than those for PVC. PVC materials, however, are more
expensive and special fittings such as valves, filters and y strainers more than double the cost.
Often to save money, flanged PVC connections are made to steel or brass flanged valves to

15

reduce the cost, however, the advantage of a corrosion resistant system is lost. In small
(1-6 machine) molding halls PVC can be a good choice since the entire installation can be done with
maintenance staff.
System
Efficiency

Although PVC pipe is smoother than steel pipe, it is not as strong. The result is that lower face
velocities (less than 5 feet per second) must be used in the design and this translates to larger
pipe diameters than a comparable steel pipe system (which can accommodate face velocities
ideally at 7 to 10 feet per second). Larger diameter pipes exert a higher load on the building
structure and support is more expensive.

Workmanship

PVC can be assembled with a minimum of skill and often for this reason, systems are installed
by less experienced workers and the results show. Steel pipe is typically welded and the required
skill level ensures the finished installation is neater in appearance and of higher quality. Repairs
and minor changes to PVC systems can be made by in-house maintenance people while similar
work on steel systems requires that outside help be brought in.

ADVANTAGES OF STEEL PIPE

Durability and long service life Records indicate many instances where steel pipe has been in

service for more than 100 years and is still doing a great job today. With the improved steels, and
advancements in linings and coatings during the past few decades, the useful life of steel pipe is only

getting better.
Economy of installation and maintenance Steel pipe is not only economical to purchase and
install, but will usually have a better life cycle cost compared to the alternatives.

With the above Exploratory data in background endeavor was made to collect
primary data from actual producers of both PVC and Steel pipe around Delhi.

16

4.6) PRIMARY DATA:


Primary data collection method was adopted using a questionnaire instrument identified
three PVC and Steel pipe manufactures around Delhi. Data was collected through
personal interview. The questionnaire used was structured and undisguised consisting of
13 important questions apart from classification section. It is given in Appendix 1 for a
meaningful appreciation of this research study.

DATA ANALYSIS & INTERPRETATION:


a) Opinion about future of steel pipe
SURVEY RESULTS
NUMBER PERCENTAGE
GOOD
34
BAD
SO SO
67
CANT
SAY
INTERPRETATION Out of three one told that future of steel pipe is good while
other two informed future was so so.
INFERENCE: The growth in steel pipe in future may not be the same rate as
growth of Total pipe market
b) Importance of margins, turnover & needs in influencing customer purchase
decision to purchase PVC or steel pipe in case of undecided Customer.
SURVEY RESULTS (IN %)
MOST
IMPORTANT
MARGIN
33
TURNOVER
CUSTOMER 67
NEEDS

SOMEWHAT
IMPORTANT

33
33

NEITHER
IMPORTANT
NOR
UNIMPORTANT
67
67

SOMEWHAT
UNIMPORTANT

INTERPRETATION: In case of undecided customer coming to them two informed


Margin & Turnover were neither important nor unimportant while one informed
margin was most important, one informed that Turnover was somewhat important.
Two producers informed that Customer needs were most important while one
producer informed that customer needs were somewhat important

17

MOST
UNIMPORTANT

INFERENCE
In case of undecided customer coming to producers for pipe they consider customer
needs on top of their mind .
c) Factors that customer considers important while making purchase decision

FACTORS

SURVEY RESULTS ( IN %)
MOST
SOMEWHAT
IMPORTANT IMPORTANT

PRICE
WEIGHT OF PIPE
DURABILITY
BRAND
TRANSPORTATION
HAZARDOUS TO
HUMAN HEALTH
HAZARDOUS TO
ENVIRONMENT

33

34
33

NEITHER
IMPORTANT
NOR
UNIMPORTANT

SOMEWHAT
UNIMPORTANT

MOST
UNIMPORTANT
33

67

100
33

100
100
67

33

67

INTERPRETATION: In their view point when customer makes a pipe purchase


decision the importance given to above factors on 5 point rating scale is as follows:
PRICE :
One told it is most important ,one told it is somewhat important while one
told it is most unimportant.
WEIGHT OF PIPE: Two informed that it is neither important nor unimportant
while one told it is somewhat important.
DURABILITY :All the three told it is most important.
BRAND: All the three informed that it is neither important nor unimportant.
TRANSPORTATION: All the three were of the opinion that it is neither important nor
unimportant.
HAZARDOUS TO HUMAN HEALTH: Two of them were of the opinion that it is
neither important nor unimportant while one was of the view that it is most important.
HAZARDOUS TO ENVIRONMENT: Two of them were of the opinion that it is neither
important nor unimportant while one was of the view that it is most important
INFERENCE:As per their view point when customer makes a decision
regarding purchase of pipe the most important factor is durability of pipe
followed by price and hazardous to HUMAN HEALTH & ENVIRONMENT.

d) Brand preference of steel pipe


BRAND
NUMBER
TATA
1

PERCENTAGE
100

18

JINDAL
2
100
PRAKASH/SURYA
3
67/33
SWASTIK/RAMA
4
67/33
APOLLO/ADVANCE 5
33/67
INTERPRETATION: It is interesting to note that all the three producers considered
Brand as neither important nor unimportant they were unanimous in rating TATA
as No 1 followed by Jindal Prakash Surya & Swastik.Their Brand was placed by
them on $th position by one and 5 th position by two of them.
INFERENCE: As their brand was placed at 4 th or 5th position either they were
targeting non Brand conscious customer or using some other marketing strategy
to sell their product.
e) Brand preference of PVC pipe
BRAND
NUMBER
PERCENTAGE
FINOLEX/TIRUPATI
1
67/33
SUPREME
2
100
KISSAN/JAIN JALGAO
3
67/33
PRAKASH/KISHAN/PRINCE 4
33/33/34
APOLLO/RAMA/NIL
5
33/33/34
INTERPRETATION Two of them considered Finolex as No 1 Brand while 1
considered his brand Tirupati as No 1.All of them considered supreme as No 2.Two
of them considered Kissan as no 3 brand while one considered Jain Jalgao as No 1
brand. Each of them considered either Prakash /Kishan or Prince as no 4 Brand
.One of them didnt rate any of them as No 5 while two of them rated as their
Brands as no 5.
INFERENCE As in two cases their brand was placed at 5th position either they
were targeting non Brand conscious customer or using some other marketing
strategy to sell their product
f) PERCENTAGE BREAKUP OF SEGMENT WISE SALES OF PVC & STEEL
PIPE.
SEGMENT
PVC %
STEEL PIPE %
HOUSING
10
10
CONSTRN
AGRICULTURE
70
15
INFRASTRUCTURE 20
35
DRINKING WATER 0
35
OTHERS
0
5

20%

GRAPH 8

HOUSING

0%

10%

70%

SEGMENT WISE SALES OF PVC PIPES

AGRICULTURE

INFRASTRUCTURE

OTHERS
19

SEGMENT WISE SALES OF PVC PIPE IN PERCENTAGE

GRAPH 8
SEGMENT WISE SALES OF STEEL PIPE IN PERCENTAGE

20

35%
15%

5%

10%
35%
AGRICULTURE
OTHERS

INFRASTRUCTURE
DRINKING WATER

HOUSING

INTERPRETATION
THEIR % segment wise sales was as shown in the pie table.
INFERENCE
PVC pipe sales was maximum in the Agriculture sector followed by infrastructure
and housing sector. Steel pipe sales was maximum in infrastructure and drinking
water supply scheme followed by agriculture housing and others.
g) Channel wise sales of PVC & steel pipe
PVC PIPE %

STEEL PIPE %

21

DEALERS
DIRECT PVT
DIRECT GOVT
EXPORT

65
10
20
5

20
15
35
30

GRAPH 9

70
60
50
40
30
20
10
0
PVC PIPE
DEALERS

STEEL PIPE
DIRECT PVT

DIRECT GOVT

EXPORT

CHANNEL SALES OF PVC PIPE VS STEEL PIPE


INFERENCE
PVC pipe maximum sales was through dealers followed by govt depts. directly by
producers. In case of steel pipes maximum percentage of sales was to
govt depts. directly followed by exports and dealers.

22

h) PIPE PRODUCTION AND CAPACITY 2003


PVC PIPE CAP
PVC PIPE PRDN
STEEL PIPE CAP
STEEL PIPE
PRDN

FACT B (MT)
8000
6000
60000
36000

FACT A (MT)
12000
12000
40000
30000

FACT H (MT)
6000
4800
72000
60000

GRAPH 10

80000
70000
60000
50000
40000
30000
20000
10000
0

PVC PIPE CAP


STEEL PIPE CAP

H
PVC PIPE PRDN
STEEL PIPE PRDN

PVC PIPE/STEEL PIPE INSTALLED CAPACITY


AND PRODUCTION OF PAST THREE YEARS

23

B FACTORY
PVC PIPE CAPACITY

2001
NOT
INSTALLED
0

2002
NOT
INSTALLED
0

40000
24000

40000
24000

6000
75
60000
36000

60

60

60

A FACTORY
PVC PIPE CAPACITY
PVC PIPE PRDN
% AGE UTILIZATION
STEEL PIPE CAP
STEEL PIPE PRDN
% AGE UTILIZATION

2001
12000
8000
67
40000
27000

2002
12000
10000
83
40000
28000

2003
12000
12000
100
40000
30000

68

70

75

H FACTORY
PVC PIPE CAPACITY
PVC PIPE PRDN
% AGE UTILIZATION
STEEL PIPE CAP
STEEL PIPE PRDN
% AGE UTILIZATION

2001
6000
2000
33
72000
50000

2002
6000
3500
58
72000
55000

2003
6000
4800
80
72000
60000

69

76

83

PVC PIPE PRDN


% AGE UTILIZATION
STEEL PIPE CAP
STEEL PIPE PRDN
% AGE UTILIZATION

2003
8000

INTERPRETATION:
As is evident from Table 4 the percentage utilization of capacity for Factory B for
steel pipes is 60% while for PVC in first year of production it is 75%.In case of
factory A while for steel pipes the capacity utilization is 68%in 2001,70% in 2002
and 75% in 2003,for PVC PIPES the capacity utilization has reached 100% in 2003.
In case of factory H the steel tube capacity utilization has increased from 69% to
83% ,for PVC pipe it has increased from 33% to 80%
INFERENCE
Demand from PVC is increasing fast compared to steel pipes demand.

i)

ANALYSIS OF SEGMENTS THAT ARE SHIFTING


FROM STEEL PIPES TO PVC PIPES.

24

All the three were of the view that demand has shifted from Steel pipes to PVC pipes
in certain segments of AGRICULTURE Sector and Infrastructure sector.
REASONS
The main reasons given was.
1) CHEAP PRICE OF PVC PIPE
2) LIGHT WEIGHT OF PVC PIPE

5) RESEARCH FINDINGS
The growth in steel pipe market in future may not be at the same rate as growth of
overall pipe market. There is ALL INDIA overall growth of 39% in demand of PVC
PIPE in 2004 compared to 2001.The same figure FOR Steel pipe is 22%.While the
price of PVC pipe has increased by 15% in 2004 compared to 2001,the
corresponding increase in galvanized steel pipe price is 59%.Weight of 110 mm dia
PVC pipe is 1.7 Kg ,while the same dia pipe of steel weighs 10 Kg.When customer
makes a decision regarding purchase of pipe the most important factor is durability
of pipe followed by price and hazardous to HUMAN HEALTH & ENVIRONMENT
and weight of pipe.. In case of undecided customer coming to producers for pipe
they consider customer needs on top of their mind rather than their turnover and
margin.. As their brand was placed at 4 th or 5th position either they were targeting
non Brand conscious customer or using some other marketing strategy to sell their
product. As in two cases their brand was placed at 5 th position either they were
targeting non Brand conscious customer or using some other marketing strategy to
sell their product.
PVC pipe sales was maximum in the Agriculture sector followed by infrastructure
and housing sector. Steel pipe sales was maximum in infrastructure and drinking
water supply scheme followed by agriculture housing and other segments.
PVC pipe maximum sales was through dealers followed by Government
Departments done directly by producers. In case of steel pipes maximum
percentage of sales was to Government Departments done directly by producers
followed by exports and dealers.
The percentage utilization of capacity for PVC is higher compared to Steel pipe
installed capacity.
There has been a shift in demand from Steel pipes to PVC pipes in certain
segments of AGRICULTURE Sector and Infrastructure sector. The main reasons
given were CHEAP PRICE and LIGHT WEIGHT of PVC pipe.

6) CONCLUDING REMARKS
To increase its growth rate the steel pipe manufacturers will have to find new segments,
cut down costs and try to increase the durability of pipes further.As the pipe market is

25

growing there is no immediate threat for HR coil Producers but in the long run they will
also have to explore newer segments for sales.

----------------------------------------------------------------------------------------------------------Please note

QUESTIONNAIRE on next page

APPENDIX 1

7. QUESTIONNAIRE
26

1.) you are in the pipe manufacturing business for the past how many years
(a)
< Than 5
(b)
> 5 - 10
(c)
> 10 - 15
(d)
> 15
2.) In your opinion the FUTURE of STEEL PIPE is
(a)

Good

b)

Bad

(c) So so

(d) Cant say

For Q 3 & Q 4
5=
4=
3=
2=
1=

MOST IMPORTANT
SOMEWHAT IMPORTANT
NEITHER IMPORTANT NOR UNIMPORTANT
SOMEWHAT UNIMPORTANT
MOST UNIMPORTANT

3) Please rate the importance of following Parameters, when you influence the
customers purchase decision in case of undecided customer steel pipes vs. a vs.
PVC pipes
1

i) YOUR MARGINS
MOST
UNIMPORTANT
1
ii)

YOUR
TURNOVER

CUSTOMER
NEEDS

MOST
UNIMPORTANT
1

iii)

MOST
IMPORTANT

MOST
UNIMPORTANT

5
MOST
IMPORTANT

MOST
IMPORTANT

27

4) From your experience kindly RATE ON FOLLOWING FACTORS THAT


CUSTOMER CONSIDERS IMPORTANT when making pipe purchase
decision.

1
i)

PRICE
MOST
UNIMPORTANT

MOST
IMPORTANT

ii) WEIGHT OF PIPE


MOST
UNIMPORTANT

1
iii)

MOST
IMPORTANT

DURABILITY
MOST
UNIMPORTANT
1

iv)

MOST
IMPORTANT

BRAND
MOST
UNIMPORTANT

MOST
IMPORTANT

v) TRANSPORTATION
MOST

MOST

28

UNIMPORTANT
1
vi)HAZARDOUS TO
HUMAN HEALTH

MOST
UNIMPORTANT

1
vii)HAZARDOUS TO
ENVIRONMENT

IMPORTANT
5
MOST
IMPORTANT

MOST
UNIMPORTANT

5
MOST
IMPORTANT

5.)
Please give the ranking of BRAND PREFERENCE OF STEEL PIPE by the
customer
1.
2.
3
4.
5.
6.

6)
Please give the ranking of BRAND PREFERENCE OF PVC PIPE by the
customer
1.
2.
3
4.
5.
6.
7.) YOUR % BREAKUP OF ANNUAL sales to FOLLOWING SEGMENT OF
PVC & STEEL PIPES is

SEGMENT
PVC
a) HOUSING CONSTRUCTION
b) AGRICULTURE
c) INFRASTRUCTURE
d) DRINKING WATER SUPPLY
e) OTHERS
TOTAL

|
|

STEEL PIPE
|
|
|

|
|
|

|
|
|

100%

|
|

100%

29

8) Kindly give us your % breakup of ANNUAL SALES to following segments of


PVC and steel pipes.

SEGMENT
PVC

|
|

a) DEALERS
b) DIRECT PVT
c) DIRECT GOVT
d) EXPORT
TOTAL

STEEL PIPE
|
|
|
|
|

100%

|
|
|
|
|

100%

9) Last year (2003-04) WHAT WAS YOUR TURNOVER OF


a)PVC

PIPES __________ CRORES

10)
Please give in MT
PRODUCTION for

b) STEEL PIPES __________ CRORES

your PRODUCTION CAPACITY


2001

2002

and ACTUAL
2003

PVC PIPE CAPACITY


PVC PIPE PRDN
% AGE UTILIZATION
STEEL PIPE CAP
STEEL PIPE PRDN
% AGE UTILIZATION

11) THIS YEAR (2004-05) you EXPECT A TURNOVER OF


a)PVC PIPES __________ CRORES
b) STEEL PIPES __________ CRORES

30

12) In your opinion WHICH SEGMENT OF CUSTOMERS are SHIFTING from


STEEL PIPES TO PVC PIPES (Please Tick)
1.AGRICULTURE
2.HOUSING CONSTRUCTION
3.INFRASTRUCTURE
4.OTHERS
5. ANY OTHER ( PL SPECIFY)

13) WHY DO YOU THINK they are SHIFTING FROM STEEL PIPES TO PVC
PIPES

THANKS SIR FOR SPARING YOUR


VALUABLE TIME

31

CLASSIFICATORY DATA OF PIPE


MANUFACTURERS
NAME

ADDRESS

OWNERS NAME

Sh

CONTACT NUMBER

ANNUAL TURNOVER
IN CRORES)
DATE OF VISIT
VISITED BY

:
:

32

33

34

35