Chapter 1– Introduction
The furniture sector in India only makes a marginal contribution to the formation of GDP,
representing just a small percent (about 0.5%), which indicates a huge potential for growth.
It is estimated that the furniture industry comprises 25% of the construction industry and
hardware comprises 40% of total furniture industry, out of this 20% is replacement and
20% is new. Wood and wooden products, furniture and fixtures carry a weight of 27.01% in
the total manufacturing sector.
The furniture industry employs a total of around 30,000 workers. The future on the
furniture sector in India seems positive. Talking about production, several agreements have
been signed between local producers looking for technology and European and Asian
companies trying to reach a potential opportunity in costs.
From the commercial point of view, India shows good perspective to sell furniture in the
following years. First of all, because its size and secondly due to the newly acquired taste as
a result of exposure to western furniture style.
India is one of the largest consumers of wood in South East Asia. Until a few years ago the
county had considerable quantities of available tropical woods. The most common species in
Indian forests are teak, rosewood, ebony, laurel, pine, cedar and rubber trees. Supply of
these “ready to uses” species became scarcer due to unconditional and inappropriate
exploitation and also due to growing concern about the environment.
In India, natural rubber plantations covers 520,000 hectares with another 6,000 hectares
replanted almost every year since 1994. Kerala state (South India) produces 95% of the
total supply of rubber wood in India
India imports wood (logs) especially from Malaysia, Indonesia, Myanmar, Ivory Cost,
Cameroon, Nigeria, Ghana, South Africa and New Zealand and to some extend from South
America. Most soft and hard woods are imported from Russia, Scandinavia and other South
East Asian counties. MDF is imported from Europe, and there is also a small local
production. Veneered panel are becoming more popular in India and are imported from the
European Union and the USA. The total size of Indian furniture industry is estimated at Rs.
350 thousand million but almost 85% of this is unorganized. The remaining 15% is
organized and is believed to be growing at a steady pace of 12% to 15% per annum.
The share of the wooden furniture market is estimated at Rs. 600 million. Woodworking
industry of India is one of the fastest growing in the county’s economy. Much of this growth
has been fuelled by the increasing access to modern machinery and technology through
easier import policies as a result of India’s entry into the WTO in the year 1990s. There is a
noticeable shift in the preference towards mechanized mass production and the up
gradation of technology.
The upcoming Commonwealth Games in 2010 will also support growth of the housing and
construction sectors in India. Imports constitute 20 percent of total annual consumption of
wood in India, while plantations and forestry contribute 58 and 22 percent respectively
Though technology has made inroads in the industry with increasing stress on the use of
machines, overall scenario reveals that almost 80% of the products supplied in local
markets by indigenous manufacturers are labor intensive and handmade.
Residential or household furniture accounts for over 60% of the overall domestic and
leading manufacturers have begun to realize the necessity of proper distribution system in
this area.
Among other sectors where the demand is spiraling upwards is office furniture. Growth of IT
an IT- enabled sector such as BPO’s has created a huge demand in metros and Class II
cities all over India. The old economy businesses are also undergoing a makeover and this
is reflected through changing looks of the offices.
Metal and plastic furniture production is gaining wider prominence but wood still remains to
be the most favored medium.
As with the global market, home furniture is the largest segment in the Indian furniture
market, accounting for about 65 per cent of furniture sales. This is followed by, the office
furniture segment with a 20 per cent share and the contract segment, accounting for the
remaining 15 per cent.
Home furniture in India is available in a wide range, to cater to different customer needs. A
typical middle class urban Indian home has five rooms (including kitchen and bathroom).
About 25 per cent of the urban population lives in homes with five rooms or more, while 45
per cent live in houses with three rooms or less. About 16 per cent is estimated to live in
single-room homes. The type of furniture used depends on the customer’s affluence and
taste. The rich and upper middle class is typically very attentive to design and quality, so
price is rarely a determining factor. In general, European style furniture is only found in
homes of the urban upper class. Demand for furniture of international standards is limited
to the larger cities. It is also estimated that the wealthier classes do not change furniture
very frequently; the average life of a piece of furniture is about 20 years and some
craftsmen’s pieces are used for as long as 50- 70 years. Colonial furniture is still very
common in India, but the trend seems to be declining slowly.
The office furniture segment caters to the commercial and office space. This segment has
witnessed rapid growth in recent years, in line with the growth in the Indian economy and
subsequent demand for office space. The thrust on real estate and office construction is
expected to sustain in the near future, indicating continued growth for the furniture industry
1.2.3 Contract segment
The contract segment caters primarily to hotels and its growth is consequently linked to
growth in tourism and development of new hotels.There is around 1,200 hotels in India in
the organized sector. More than 10 per cent of these are in the 5-star and above categories
The Indian furniture industry is estimated at around Rs 35,000 crore (Rs 350 billion).
Eighty-five per cent of this falls into the unorganized sector.
The share of the wooden furniture market is around Rs 60 crore (Rs 600 million).
The world home furniture market is worth Rs 20,000 crore (Rs 200 billion). During the past
three years, it grew by 20 per cent a year. According to a World Bank study, the organized
furniture industry is expected to grow by 20 per cent a year and India, Russia and Brazil
will witness a boom. The range of indigenous furniture available in India includes both
residential and contract system furniture, with an increased concentration in office and
kitchen furniture.
Though technology has made inroads in the industry with increasing stress on the use of
machines, overall scenario reveals that almost 80% of the products supplied in local
markets by indigenous manufacturers are labor intensive and handmade.
Residential or household furniture accounts for over 60% of the overall domestic and
leading manufacturers have begun to realize the necessity of proper distribution system in
this area.
Among other sectors where the demand is spiraling upwards is office furniture. Growth of IT
an IT- enabled sector such as BPO’s has created a huge demand in metros and Class II
cities all over India. The old economy businesses are also undergoing a makeover and this
is reflected through changing looks of the offices. Metal and plastic furniture production is
gaining wider prominence but wood still remains to be the most favored medium.
Unlike other home solutions focused retail formats run by the Future Group and Shoppers
Stop, which have recently seen a double-digit decline in same-store sales Godrej’s furniture
retail business, has in fact seen a 25-30 per cent rise in same-store sales. Building on the
success, the group expects to expand its retail chain network to 200 stores over the next
three years using a mix of company-owned and operated outlets to franchisees. At present,
all of the chains’ stores are company owned and operated. Godrej says “that in difficult
times, customers tend to patronize brands, which are known for their reliability and
durability”.
The group’s wide sales network in B and C class towns too it said, has helped it side step
the effect of the slowdown because furniture sales in these towns were impacted less than
those in the metros. In addition to its own retail chain, Godrej also sells its furniture range
through its wide network of dealers and franchisees. Along with expanding its own retail
chain, Godrej & Boyce continues to appoint new franchisees to further grow its sales
network pan-India. In keeping with its focus on ‘Brighter Living’, the group is now trying to
connect. more closely with its consumers and is engaging in more one-to-one research and
customer emotion studies to help uncover what its target consumers want. The input is fed
this back into its marketing and new product development initiatives.
2.3.2 Durian
From plywood to furniture Durian integral part of the lives of millions of Indians, Durian has
set new trends in lifestyle with quality benchmark products, redefining the word “piece of
furniture” to a lifestyle product which dictates pride of possessing it. Enriching lives across
boundaries they are today one of the largest interior infrastructural household names in
India with a network extending to every nook and corner of the nation. It has most
prominent ISO 9001 and 14001 certifications for our quality standards and contribution in
the industry. Durian is a yarn of how two generation of a close knit business family built a
conglomerate that is a household name in the country today. The journey has been eventful
marked by numerous pioneering achievements in the building material industry. Durian is
the pioneer of natural veneer in the building material industry in India. Their products have
met the most stringent of international quality standards, resulting in our constant supply
not only in the domestic market but the international market also. Durian has also
introduced readymade doors in this industry to make life trouble-free for all the users with
a range of designs and colors to suit every eye. Durian has imported home and office
furniture range which is sourced from all over the world which is the talk of the nation in
terms of world class designs be it classic or contemporary. The furniture pieces which are
sourced from across the world to meet the new changing taste of the Indian market. For the
first time in India, with the help of overseas research and technical team Durian introduces
Laminates which are guarded to resist borer, fungus and termite. It’s the proprietary know-
how which Durian has developed in collaboration with highly techno-savvy foreign research
laboratory.
The ideas and products have resulted in intensive transformation of technology for chairs
and workstations to give corporate look to offices meeting international standards. To fulfill
the demand of the ever changing market in office furniture they have built state-of-the-art
factories with the most advanced technology, with BIFMA standard guidelines. They have
also started offering services for turnkey projects to provide a complete package to our
clients. In concise
Durian offers lifestyle products related to interior design of office, home under one roof.
2008•
Established Veneer Edge banding plant at Palghar in joint venture with Canadian
Company Launched Accessories, Furnishings, Paintings and Decorative Lightings division in
all Durian Showrooms
2007•
Launched 10 of Durian’s retail Factory Outlets Showrooms all over India
Started Veneer Splicing plant at Palghar with Canadian collaboration
2006•
Set up a plant for manufacturing Decorative Laminates (HPL) with latest machineries at
Ahmedabad, Gujrat Started manufacturing modular office furniture plant at Palghar
Started manufacturing Office Chairs at Palghar Started providing services for Turnkey
Projects
2005•
Completed successfully a network of 40 imported furniture showrooms all over the
country • Added facility for manufacturing HDF doors at Wada, near Mumbai
2003
Added office furniture range in the category of imported furniture
2001•
Launched one of the largest Imported furniture Showroom at Mumbai
1999•
Launched first retail showroom of Durian imported furniture for home range in
Ahmedabad, Gujrat
1998•
Started manufacturing P.V.C door skin & P.V.C. molded doors in Wada
1995•
Set up , for the first time in India a decorative veneer manufacturing unit at Palghar with
latest technical know how and the equipments
1991•
Established 4th plywood manufacturing unit at Palghar
1990•
Established 3rd plywood manufacturing unit at Palghar
1988•
Installed Timber peeling plant at Wada
1987•
Established 2nd plywood manufacturing unit at Palghar
1985
Established first Plywood manufacturing unit at Palghar
1981•
Started activities in Mumbai with retail & wholesale trading of Plywood
2.3.3 Zuari
Indian Furniture Products Limited (IFPL) is a part of the KK Birla Group, one of the most
respected business houses in India. The KK Birla Group has under its mantle, a diverse
range of industries ranging from agrochemicals to fertilizers, financial services to media.
And in anticipation of increasing global demands, furniture is the latest addition to the
corporate portfolio. Deploying sophisticated technology from europe that gives it unique
manufacturing capabilities, IFPL also has the distinction of having created the largest
furniture retail chain in india
Zuari, the flagship brand Indian Furniture Products Limited (IFPL), a part of the K K Birla
Group and an ISO 9001:2000 certified company, have changed the perception of people
about furniture. Zuari’s wide and affordable range of offerings like bedroom furniture, TV
trolleys, computer tables, utility furniture etc have not only added to the convenience, but
have become style statements owing to their sleek designs and trendy looks. And the
beauty of the furniture is not just skin deep. They are manufactured with the most
sophisticated European RTA (Ready To Assemble) technology, in a state-of-the-art plant
near Chennai, Tamilnadu. The product range offered is made from raw materials imported
from France, Belgium, Germany and UK. The furniture is grafted on CNC controlled
automated machinery imported from Germany, Italy and Spain. The technology set up is
the largest of its kind in the entire Asia and a substantial portion of the company's
production is being exported to developed countries of Europe, viz France, Germany, UK
and Belgium
The success of Zuari lies in their understanding of the Indian Consumers, who have been
long craving for stylish and easy to assemble furniture at affordable costs. A strong
distribution network of 21 distributors, 14 Wholesalers and more than 450 dealers has
helped Zuari to reach its customers through the length and breadth of the country with
readily available goods and excellent after sales service.
With the mantra of offering more style and utility at reasonable prices, it seems Zuari is
clearly emerging as the most popular choice of the discerning consumers.
Expertise IFPL has a design team trained in Europe. This accounts for the team's expertise
in various functional aspects of furniture design and a keen sense of aesthetics, honed by
constant exposure to international furniture fairs. In addition, interaction with
designers/manufacturers in Europe and developing exclusive designs for several
international clients. In fact this expertise has helped IFPL bag prestigious projects from
corporates and institutions such as Reliance Industries, Ernst & Young, Schwings Stetter,
Chambal Fertilizers, and IIM-Calicut etc. This has given IFPL an organizational learning that
allows manufacturing furniture on a turnkey basis
2.3.4 Tangent
Tangent is a chain of sprawling showrooms that put together everything an office or a home
needs. The furniture is gathered from all over the world. Spain, Italy, Malaysia, France,
Hong Kong with a firm grip on the international furniture pulse, when we feel that you might
like some furnishing, we bring it down for you. Furniture designs at Tangent are renowned
for their elegance, international appeal, durability and affordability
Bedrooms and living rooms, cozy nooks and comfortable dens- our furniture will fit right into
your lifestyle. Sets for bedrooms and living rooms. Recliners, couches, sofas and settees,
loveseats, beds, dressers, dining tables… the list is endless.
For your office needs, Tangent offers ergonomically designed contemporary seating,
spacious desks, open plan office systems, and much more. All of these are designed to
utilize space in an optimum manner and promote productivity. Comfort and durability are
the trademarks of our business furniture line. At Tangent your every space requirement will
be met. We invite you to help us make your dreams come true.
2.3.5 Ikea
IKEA furniture’s, privately held; international, low-cost home products are an inevitable part
of interior furnishings at many houses in the world. IKEA furniture’s are marked for its
modern utilitarian design. The company has 250 retail outlets in 34 European countries
while 24 new stores are on the line to be opened in 2007 including India. At this moment of
this house product's successful expenditure, its history will enable you to understand how
this furniture will add charm to your house interiors.
IKEA was founded in 1943 by a 17-year-old Ingvar Kamprad in Småland, south of Sweden.
IKEA formed its name from the founder's initials (I.K.) plus the first letters of Elmtaryd and
Agunnaryd, the farm and village where he grew up from a farmer to a businessman. Ingvar
sold whatever he found could fill with a product at a reduced price under the brand name of
IKEA. When Ingvar Kamprad outgrew his ability to make individual sales calls in 1947,
furniture was introduced into the IKEA product range. Local manufacturers in the forests
close to Ingvar Kamprad's home produced the furniture. The founder of IKEA soon saw the
opportunity of becoming a furniture provider on a larger scale and discontinued all the other
products to focus directly on low-priced furniture. The result is the IKEA that we know
today.
In 1953 the first IKEA furniture showroom was opened in Älmhult. In1955 IKEA began
designing its own furniture. Much of IKEA's furniture was designed to be assembled by the
consumer rather than being sold pre-assembled. IKEA made a revolutionary change in the
interior furnishings by reducing the price of quality furniture’s to a minimum amount. The
successful saga took a new turn as the first IKEA store in Norway opened outside Oslo in
1963.IKEA store opened at Stockholm in 1965, in 1969 at Denmark, in 1973 at Zurich,
Switzerland, in 1974 at Munich, Germany and the store opening continued as a new store
opened in each succeeding years at a new country.
IKEA products vary from upholstered furniture, coffee tables, beds, carpets, lightings, and
garden furniture’s to a variety of household furniture’s. Most of the names are Swedish,
Danish, Finnish or Norwegian in origin. Although there are some notable exceptions, most
product names are based on a special naming system developed by IKEA. For example,DU
KT IG (good, well-behaved) is a line of children's toys,O SLO is a name of a bed,JERKER (a
Swedish masculine name) is a popular desk, DINERA for tableware,KASSET T for media
storage. A range of office furniture is namedEFFEKT IV; ÄRPT (sharpened in Swedish) is a
line of kitchen knives. IKEA has initiated its activities in India in 2000.Together with
UNICEF; IKEA initiated a broad community program in the north of India in August 2000.
The aim is to prevent child labor by creating awareness and addressing the root causes. The
project focuses on 200 rural
communities, involving the villagers in strategies for preventing child labor.
The manufacturing facility located near Chennai is a fully automated sophisticated plant
equipped to manufacture exquisite pieces of furniture of impeccable quality. The plant is
also one of Asia’s most modern and largest manufacturing facility.
The products - elegant and contemporary furniture for homes and offices, mattresses and
pillows – are retailed in exclusive Style Spa showrooms spread across the country.
Style Spa is the largest retailer of furniture in India with over 90 exclusive showrooms
spanning the length and breadth of the country. Style Spa’s competitive edge lies in its
elegant range of products which are difficult to replicate, its State of the Art manufacturing
facility that ensures consistent quality, a large retail network, experienced, and qualified
personnel that make up the Style Spa team and not to mention the tens and thousands of
homes that revel in the Style Spa brand of Good Living.
The key raw materials include wood, metal and plastic, with bamboo and cane also being
used in some cases. Wood accounts for nearly 65 per cent of all furniture made in India.
This includes several types of indigenous wood, as well as imported wood. India imports
wood from various South East Asian countries such as Indonesia, Malaysia and Myanmar. It
also imports MDF (Medium Density Fiberboard) boards from Europe
Wood
India abounds in several tree species whose wood is used for furniture making. Apart from
indigenous material available in India, some types of wood are also imported, in case the
domestic supply is inadequate. Popular wood types used in India include Walnut,
Sandalwood, Teak, Sheesham,Deodar, Ebony, Redwood, Rosewood, Red Cedar and Sal.
Teak accounts for almost 50 per cent of the total wooden furniture produced, Sal and
Deodar account for about 20 per cent and the balance includes Mahogany, Cedar and other
tree types. Bamboo Material Boards (BMB) are increasingly being used in place of plywood.
India also has abundant rubber wood supply. Natural rubber plantations cover 520,000
hectares with an additional 6,000 hectares being replanted almost every year since 1994.
The southern state of Kerala produces 95 per cent of the total supply of rubber wood in
India. Although furniture making as an activity is spread across the length and breadth of
India, a few centers have become famous for their exquisite carving, inlaying, turning and
lacquering. Indian states well known for woodwork include Gujarat, Jammu & Kashmir,
Punjab, Uttar Pradesh and Kerala. India is one of the largest consumers of wood in South
East Asia. The country has sufficient availability of tropical wood, however, in recent years,
growing concerns about the environment and the need for conservation of forests have led
to reduction in the supply of wood. India imports wood from various countries like Malaysia,
Indonesia, Myanmar, and Ivory Coast, etc. MDF boards are imported from Europe, soft and
hard wood are imported from Russia and other South East Asian countries. Veneered panels
are becoming increasingly popular in India and are imported from the European Union and
USA.
Domestic Manufacturing
Furniture manufacturing is driven by the designs chosen, the inputs which come from in-
house designers and market feedback. Manufacturers consider several aspects related to
the customer (demography, lifestyle, motivation and aspiration, needs and preferences),
raw material(type, quantity and availability) and internal capability (expertise, quantity and
availability of labor, production process complexity and delivery time) for developing
different designs, which in turn, determine the furniture’s functionality, look and feel and
value. Furniture produced in India falls into two broad categories, depending on the end
user; domestic furniture meant for home use and commercial furniture meant for the office
and hospitality sectors. Domestic furniture represents almost two-thirds of the total output.
The key success factors for each category vary. Manufacturers in the domestic sector
typically try to differentiate on the basis of design variety and price, while in the commercial
space, having a strong and reliable brand is important.
Imports
Furniture imports in India have been growing at nearly 64 per cent CAGR; over the 5-year
period from 2001 to 2006.A key driver is the increasing demand for furniture, fuelled by the
boom in housing and commercial construction. Increasing income levels and influence of
global lifestyle trends have also led to many urban, affluent Indians, moving towards
imported furniture. European furniture manufacturing companies have been the first
entrants, with their premium products (mainly veneered) in India. They were led by the K K
Birla joint venture, Gautier, with Groupe Seribo of France. Furniture imports from other
Asian countries have come in much later. Barring a few, such as, Renaissance Home,
Interior Espania, Pinnacle Saporiti and Gautier, most of the imported furniture dealers sell
their products either under their own brand name or without any branding. In recent times,
import of cheaper furniture from South East Asian countries has been increasing.
Distribution
Indian furniture companies operate both, through direct selling in the market and
distributors. Companies with a large local customer base normally sell directly, without
involving distributors. The larger companies typically have their own commercial offices and
showrooms in all the larger cities in India. Many organisations prefer, however, to operate
via organized outlets. For projects of large volume, companies typically sell directly to the
customer – the primary customer is often the ‘specifier’ (architects, builders or project
managers) or building owners/lessees who are responsible for fitting out buildings and
offices. Armed with the choice of local and imported products, these purchasers exert
significant influence on the sector
Retailers
There are a large number of furniture retailers and franchises spread across the country.
While the majority of retailers are small in size and scale, large retailers usually operate in
urban markets. One-stop shopping chains for home building solutions have come up in large
cities, such as Arcus in Gurgaon and KSS Home Pro in Bangalore. Another development has
been the emergence of specialty furniture chains, such as, Usha Shriram Furniture
Industries, OCL, Pace Furniture, Indoors and Renaissance Home. With the rapidly growing
and transforming retail sector, it is expected that the large retailers will continue to expand
their presence, leading to consolidation in furniture retailing in urban markets
2.4 Locations known for excellence in woodwork
Although, furniture is manufactured in many different parts of the country, a few centers
have become well known for their exquisite carving, inlaying, turning and lacquering
These are:
2.4.1 Gujarat
Besides carved chests and almirahs, Gujarat is synonymous with the wooden swing. The
different varieties of swings are made using a range of wood from unvarnished hewn wood
to rich lacquer. Sankheda village, in Gujarat, has a unique tradition of engraving
indigenously developed silver, gold and bronze colors on wood. Surat, has a tradition of
parquetry-work, which is locally called Sadeli.
2.4.2 Kashmir
In Kashmir, extensive wood-work has been used for structures since ancient times. Houses
are lined with wood ceilings worked in geometrical patterns and windows in lattice work.
The Kashmiri houseboat made entirely of a specially seasoned wood that does not warp in
water, is a visual delight.
India is the fourth largest economy in the world and it’s the largest democracy with second
largest GDP among emerging economies. World Bank’s President James D. Wolfensohn
confirmed that India is not the world’s 4th largest economy after USA, China and Japan in
PPP (Purchasing Power Parity). It is also one of the ten fastest growing economies in the
world. With 1 billion populations, India remains on the fastest growing economies and even
in the present worldwide economic slowdown, has maintained GDP Growth rate of nearly
6%. India today is 7th most attractive destination for foreign direct investments, after US,
China, Brazil, Mexico and Germany. Besides, India offers higher rate of returns and
profitability than anywhere else in the world. Out of 1 billion population the upper and
middle class constitutes 20% or 200 million people (or 30 to 40 million houses). By rent per
capita: •
2 percent of Indian has a per capita income in excess of 14,500 Euros, which means
20 million people.
8 percent of Indians have a per capita income of more than 3,900 Euros, which
means 80 million people.
10 percent of Indians have a per capita income in excess of 3,200 Euros, this is
about 100 million people
Levels of affluence are high- with the number of individuals in the “high: income
demographic group doubling each year, according to NCAER statistics.
The actual “disposable” income at the disposal of the affluent Indian is as high as
three to five times higher as the official statistics, on account of the very large
proportion of unaccounted (“black”) money income.
The market has, due to exposure to overseas products and lifestyles, displayed the
willingness and ability to purchase overseas brands and products at high prices.
Customs duties and tariffs have been drastically reduced, in keeping with
government policy to open up the economy – a policy which has stayed constant
despite changes in government. All the products in the INDEX product range are now
permitted for import into India under OGL or the Open General License, which
implies that no special import license is required for import.
Despite the cut in duties, the rate of customs duties is fairly substantial which makes
the prices of products higher in India. There is a huge demand for furniture,
hardware and fittings, DIY equipment, lighting and consumer non-durable and
appliances.
While the Indian middle class still does not have as high a rate of obsolescence as
the US, and tend to use their furniture for several years before changing or
upgrading, the actual size of this segment makes investment in this market more
than worthwhile. The affluent classes however, do have high rate of obsolescence of
interior decoration products and redecorate constantly.
All the above factors put together make manufacturers and retailers of a wide range of
consumer durables. Several overseas companies have already entered the market and have
been extremely well received by the market
Chapter - 4 Sales Promotion Tools
Many tools can be used to accomplish sales promotion objectives. Descriptions of the main
promotional tools are as follows;
Samples:
They are offers of a trial amount of a product. It consists of inviting prospective
purchasers to try the product without cost or at a lower cost in the hope that they will buy
the product. Samples may be free or discounted.
Coupons:
Coupons are certificates that give buyers a saving when they purchase a specified product.
Coupons can be mailed, placed in advertisements or included with other products.
Rebates:
Rebate is also known as cash refund offers. Rebates are offers to refund part of the
purchase price of a product to its customers who send a proof of purchase to the
manufacturer. These are like coupons except that the price reduction occurs after the
purchase and not at the point of sale.
Price Packs:
Cents-off deals or price packs offer consumers savings by way of reducing prices
that are marked by the producer directly on the package.
Premiums:
These are the goods offered either free or at a low cost as an incentive to buy a
product. Premiums may be in-pack or on-pack (outside the pack).
Prizes:
They are offers of chance to win something such as cash, trips or goods – by luck or
through extra efforts. Contests of talent and sweepstakes or draws the most popular prize
offering promotions.
Tie-in Promotions:
Tie-in promotions involve two or more brands or companies that team up on coupons,
refunds or contests to increase their pulling powers.
Cross Promotions:
Advertising Specialties:
These are useful articles imprinted with an advertiser’s name, given as gifts to consumers.
Patronage Rewards:
They are cash or other awards for the regular use of company’s products or services. They
are values (in cash otherwise) that are proportional to one’s patronage of a certain vendor
or a group of vendors. They aim at building brand loyalty.
POP Promotions:
Point of purchase (POP) includes displays and demonstrations that take place at the point of
purchase or sale
Discounts:
It is also known as price-off or off-invoice or off-list. Discounts price cut off the list price on
a particular quantity purchased during a stated time.
Allowances:
They are the amount offered in return for an agreement by the retailer to feature the
manufacturer’s products in some way; displays, advertising or otherwise.
Free Goods:
Free goods are the extra merchandise offered to middlemen who buy a specific amount of a
product. Companies also offer push money and specialty advertising items to the
middlemen.
Companies spend huge amount on promotions focused on industrial consumers. The major
business promotion tools are as follows;
There has been an increase in sales of Branded furniture in India. The branded furniture
industry is growing at 30% per annum. Growth in this sector is being propelled by increase
in disposable income, reduction in import duties, growth in real estate sector, growth in
organized retail, rising quality consciousness amongst Indian consumers, growth in IT &
ITES Sector and growth in tourism.
In this research, a small sample size was surveyed. Hence the conclusion may not hold good
for a large number of people.
Primary data
Structured Questionnaire (Refer Annexure)
Secondary Data
Internet, Books, Magazine, Previous related study or research
conducted.
4.7.1 Technique
Simple Random Sampling
SEC A & SEC B, males & females having purchasing power of buying Branded
Furniture or have purchased Branded Furniture or willing to purchase in 6 months time.
Residing in Mumbai
Chapter 5: Data Interpretation & Analysis
Q1) Which Brand of Furniture do you own?
Q3) How much are you willing to pay for a Branded Furniture?
Descriptive
Statistics N Mean
Brand Name 100 3.86
Design 100 3.81
Quality 100 3.94
Durability 100 3.86
Price 100 3.61
Ergonomics 100 3.42
Availability 100 3.6
Compact 100 3.53
Delivery 100 3.56
Reliability 100 3.74
Valid N (listwise) 100
Brand Name, Design & Durability are the most important parameters while purchasing
Branded Furniture
Q7) Rate your Branded Furniture on the following parameters?
(Highly satisfied-5, Satisfied-4, Normal-3, Poor-2, Very poor-1)
Descriptive
Statistics N Mean
Brand Name 100 3.92
Design 100 3.77
Quality 100 3.54
Durability 100 3.42
Price 100 3.46
Ergonomics 100 3.43
Availability 100 3.48
Compact 100 3.36
Delivery 100 3.40
Reliability 100 3.47
Valid N (listwise) 100
Fig 5.7 Post purchase Branded Furniture consumers rating of their Furniture’s
Brand Name, Design, and Quality where the most important parameters post purchase of
Branded Furniture
Q9) Please rate the following sentences on a Scale of 1to 5 (where 5 is Strongly Agree and
1 is Strongly Disagree)?
Sentences N Mean
Sentence 1 100 4.05
Sentence 2 100 3.55
Sentence 3 100 3.42
Sentence 4 100 3.28
Sentence 5 100 3.29
Sentence 6 100 3.27
Sentence 7 100 3.30
Sentence 8 100 3.20
Sentence 9 100 3.46
Sentence 10 100 3.33
Valid N (listwise) 100
price of a new product introduced into the market and the consumers’ awareness of it,
high price normally means high quality to the general consumer.
Branded furniture manufacturers are in a better position to play the role of a trendy
and high quality product producer. Hence, “trendiness” and “high quality” can be
used as selling points.
“High quality” can be substantiated by the materials used, product quality and
service offered. Branded furniture companies should strike a balance between
trendiness and durability. How to win the confidence of consumers in the quality of
the products is an important market strategy.
Target the new home market, as its purchasing power is stronger. Position at the
middle- to high-end of the market. Second-time home buyers are less sensitive to
price and place more emphasis on the quality, material and grade of the product.
This market offers great opportunity to Branded furniture companies which excel in
high quality.
Distribution channels play an important role in the sale of home furnishing product,
especially furniture. Branded furniture companies should choose to establish a
presence
in stores which are positioned at the middle- to high-end of the market, have a good
image, and match the middle- to high-end image of Indian home furnishing
products.
Price is not an important consideration factor, as long as the “style” and “quality” of
the furniture meet their requirements. As consumers are most concerned about
quality and style in cases where price is an indicator of quality and style, they do not
mind paying more.