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TO STUDY THE IMPACT OF TRACTOR DEALER INFRASTRUCTURE AND
ITS EFFECTS ON SALES
Submitted in
partial fulfilment for the award of the degree of
Master of Business Administration
Punjabi University Patiala
(2011-13)
Submitted to: Submitted by:
Dr.SIMRANJIT KAUR GURPREET SINGH
ROLL NO.
______________________________________________________________________
CORDIA INSTITUTE OF BUSIESS MANAGEMENT SANGHOL
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ACKNOWLEDGEMENT
Success comes to those who strive for it. To achieve ones goal, one puts in lot of
hard work and efficiency. Unless you venture into real world you never know how lame
and in fecund your efforts could without help of various and how tough the real world
environment is. And even tougher work is enumerating and enlisting all the individuals
whose contribution went into the making of this project.
I take this opportunity to express my profound sense of gratitude to the support
given to me by Mahindra & Mahindra ltd ( Swaraj Division ), Mohali. At the outset I
would like to thankMr Varinder Gupta ( Deputy Manager IB ) for his guidance
throughout the project with his suggestions.
I owe my regards to the entire faculty of CORDIA INSTITUTE OF
BUSINESS MANAGEMENT SANGHOL from where I have learnt the basics of
Management
Date : Signature
Mohali
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PREFACE
Learning lessons and sitting in the classroom is not a difficult thing to do.
The difficulty comes in when it is time to put into practice all that a person has learnt inyears of education. When all the individuals leave the college to go out and face the
world, it is the most difficult & challenging phase of his life. It becomes easier for him if
he gets a little taste of what, he expects before he is actually in that situation. The six
week summer internship intends to do exactly that.A student is made to work in the exact environment that he would be required to work in
when he actually starts working. This is an excellent experience for the students. It also
help in the overall personality development of an individual.
Mahindra & Mahindra LTD (Swaraj Division) has provided me with very comfortable
working environment and an excellent project to work on. . It has bee taken care that thisdocument elicits the infrastructure effect in a lucid and an understandable manner. The
contents have been divided into segments called chapters, all of which has been explained
in detail in the following pages. This report presents before you a brief description of mywork during my training at Swaraj division over last six weeks. It is the summary of
project being developed by me at Swaraj Tractor Division.
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CONTENTS
Chapter 1. Overview of the Tractor Industry 5
Chapter 2. Company Profile 12
Chapter3. Objectives of the Study 29
Chapter 4. Research Methodology 31
Chapter 5. Data Analysis & Interpretation 39
Chapter 6. Findings of the Study
Chapter7. Limitations of the Study
Chapter 8. Conclusion & Recommendations
Chapter 9. Future Research
Chapter 10. References
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CHAPTER ONE
OVERVIEW OF INDIAN TRACTOR INDUSTRY
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INTRODUCTION
India being a predominately agriculture country, where agriculture is the life and blood of
the economy, has been a traditional manufacturer of different type of farm machinery and
implements. However, the use of advanced agricultural techniques in india stared only in
early 60s. Modernization and tractorization in Indian agricultural is only a post
independence phenomenon. One of the achievements of green revolution has been that
the farmers increasingly realised the advantage of tractorization. This would happen only
because of awareness of new farm technology among the farmers, rise in the level of their
income an education.
The biological source of energy especially bullocks, could not cope
with the requirements of the changed situation therefore, introduction of tractors got
accelerated in several agriculturally advanced states of country like Punjab, Harayana,
Maharashtra, etc. tractors were introduce to Indian agriculture in early 20s. The demand
of tractors rose sharply in last two decades. However, the rate of adaptation of tractors in
diff. Part of country Punjab occupies no.1 rank in this regard. Punjab possess only 1.5 %
of the geographical area of the country; the density of 85 tractors per hectare in Punjab is
the highest as compared to national average of 10.5 tractors per hectare.
India is primarily an agrarian nation , with more than 50% of our
GDP being contributed directly or indirectly by agriculture. No wonder India is
considered the largest tractor market in the world. But in terns of total tractor in use in
the country , we are ranked 8th. In terms of penetration , India has 10.5 tractors per
thousand hectare of gross cropped area(GCA)as compared to the international average
close to 30 tractors per thousand hectare of GCA
Figuratively speaking, Indias largest GCA is next only to the big two USA and Russia.
That and the highly fragmented land holding in india have helped our country to become
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the largest tractor market in the world. Thus the indian tractor market has to be only after
considering its position in the world
Description Units World total India Indias rank
Arable land Million hectare 1,444 170 2
Irrigated area Million hectare 249.6 45.8 2
Tractors in use Tractor/1000
hectare
28 10.5 8
Despite a phenomenal increase in tractors population in the country, the tractor density is
very low at about 10.5 tractor per thousand hectare of GCA in comparison to the
international of about 28 tractors . also , the small size of land holding in India have led
to low average of tractor at 35 horse power , which is far low then the global average of
above 80 HP
Easy availability of bank finance coupled with the
declining interest rate has propelled the demand for tractors. Furthermore, a good
monsoon a strong growth in agricultural production and an increase in the irrigated area
rate expected to lead to a long term growth of 7 to 8 % .
There has been a boom in the tractor industry since
1997. The sales of tractors are not evenly distributed. they are mainly concentrated in the
north and north west were Punjab, Harayana and UP account for mainly 50% of the
tractor sales. Punjab alone accounts for 26%.the main reason is comparatively larger land
holdings and the affluence farmers in these states .new market like MP, Tamil Naidu,
Andhra Pradesh, Maharastra and Gujarat are also growing at fast pac
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CRITICAL PARAMETERS FOR GROWTH OF TRACTOR INDUSTRY
AGRICULTURAL CREDIT
Nearly 90-95% tractors are purchased with the help of bank credit. It plays an
important role in determining the demand for tractors.
PRICING OF TRACTORS.
The financial inability of the Indian farmers makes the pricing a critical parameter.
Companies that managed to keep their costs low are the ones that managed to
survive during the reversionary period.
MONSOONS AND CROP PRICES.
The farmers have to pay say 15% of the total price of the tractor, in cash, at the
booking stage; Consequently, if the farmer is faced with bad monsoons and low crop
prices, he will not be able to make the initial down payments.
GOVERNMENT POLICIES
To enable a farmer to purchase a tractor against these odds, the government
introduced subsidies in this sector. During the union budget of 1994-95 the
government exempted excise on small HP tractor I. e. below 1800 cc. In the budget
of 2004 all the tractors were exempted from excise duty.
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IMPORTS
The industry has managed to reduce its dependence on imports, as many players
have indigenised their inputs, which were earlier Imported.
PRIORITY TO RESEARDCH & DEVELOPMENT
Even though all tractor-manufacturing units, except the Swaraj, were initially set up
with foreign collaboration, tractor industry has been on its own for the last decade.
Al tractors have been nearly 100% indigenous and almost all product improvement
and new products have come through indigenous Research and Development
(R&D). Capital R & D investment by industry today exceeds Rs. 22 crores and the
recurring annual expenditure is at the level of Rs. 7 crores. Emphasis on R & D is in
the steady increase in the number and price range of competing models available to
customers to choose from.
Reflection of emphasis on R & .D in the line with national priorities is the steady
improvement in the Fuel efficiency ensured on the basis of the average of fuel
efficiency figures of tractors in different power ranges during mandatory tests at
Government of Indias Testing Station at Bundi in Madhya Pradesh.
WIDENING RANGE FOR CUSTOMER CHOICE
Intense competition in tractor industry all through the last 44 years, has naturally ledto a steady increase in the variety of models for farmers to choose from. Industry
today offers 43 models, and special variants to suit regional needs and special usage
are often available in many models. Tractors offered cover a horsepower range from
15-60 and prices cover the entire spectrum from Rs. 1,00,000 to Rs. 4.5 lacs per
tractors.
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EMERGING MARKETS
In the total mature markets, which include Punjab, Haryana and U.P., sales
proportion has fallen from 55.4% in FY 93 to 37.8% in FY 97. With sales in these
markets plateauing, tractor manufacturers are now zeroing in on the central and
Southern markets in the country. These are the areas with enormous potential and
are called emerging markets. The share of these emerging markets like Madhya
Pradesh, Maharashtra, Gujarat, Tamil Nadu, Karnataka, Andhra Pradesh and
Rajasthan has increased from 41% in 1992-93 to 55.9% in 1996-97. Among these
markets, states like Madhya Pradesh, Andhra Pradesh and Maharashtra have the
highest growth. Some of the tractor manufacturers have entered the exports area; M
& M has increased exports from 132 tractors in 1993-94 to 1853 in 2002-03.
Emerging export markets potential are America, Nepal, Sri Lanka, Malaysia and
Bangladesh.
In order to be competitive, the players in Indian Tractor Industry will have to reset to
manufacturing after cutting out many of the frills in their lower HP tractors.
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CHAPTER TWO
COMPANY PROFILE
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HISTORY OF THE COMPANY
In 1965, Government of India research institute Central
Mechanical Engineering Research Institute, Durgapur, WB initiated design and
development of Swaraj Tractor based on indigenous know how. In 1970, PunjabGovernment acquired the Swaraj tractor's design and established Punjab Tractors Limited
(PTL). It was India's first large-scale totally indigenous project. The company exports
Tractors to various countries including USA. It manufacturers nine models of tractor and
several models of combine harvesters. The manufacturing units are located at SAS Nagar,Asron Village of Nawanshahar District and Nabha of Patiala District, Punjab.
Actis, a private equity firm acquired 29 per cent of Punjab Tractors in mid-2003 from the
Punjab Government. In March 2007, and currently subject to the receipt of requisiteapprovals, M&M bought a controlling 43 per cent stake in Punjab Tractors Ltd. that will
reportedly increase M&M's share in the domestic tractor market from just over 30 percent to nearly 40 per cent. The 43 per cent stake in Punjab Tractors includes the 29 per
cent owned by Actis and 14.2 per cent by the Delhi-based Burman family. In July 2007,
Mahindra upped its share in Punjab to 64.6%.
COMPANY
Punjab tractor limited was established in the year 1970 between 1971-73PTL setup Swaraj project for 5000 tractor per annum at a capital outlay of Rs.37.0
million . The equity base was Rs.11.0 million . In 1974 Swaraj 724 (26.5 hp) tractor was
commercially introduced. Its second tractor model , SWARAJ 735(39 hp) was developedits own R & D .
Today PTL has four operating division with 2202 employees. It has 443 dealers
networks and 281 ancillary base. In the year 2002 the cumulative tractor sales of thecompany crossed 5,00,000 mark.
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BOARD OF DIRECTORS
The Company's current Board of Directors is as follows:
NAME DESIGNATION
1. Mr. Keshub Mahindra Chairman
2. Mr. Anand G. Mahindra Vice Chairman and Managing
Director
3. Deepak Shantilal Parekh Director
4. Nadir Burjorji Godrej Director
5. M. M. Murugappan Director
6. Bharat Narotam Doshi Executive Director & Group Chief
Financial Officer (Group CFO)
7. Arun Kumar Nanda Executive Director & Secretary
8. Narayanan Vaghul Director
9. Dr. Ashok Sekhar Ganguly Director
10. R. K. Kulkarni Director
11. Anupam Pradip Puri Director
12. Thomas Mathew T. Nominee of LIC
14
http://www.mahindra.com/OurGroup/management_bod.html#kushubmahindrahttp://www.mahindra.com/OurGroup/management_bod.html#anandmahindrahttp://www.mahindra.com/OurGroup/management_bod.html#deepakparekhhttp://www.mahindra.com/OurGroup/management_bod.html#nadirgodrejhttp://www.mahindra.com/OurGroup/management_bod.html#mmmurugappanhttp://www.mahindra.com/OurGroup/management_bod.html#bharatdoshihttp://www.mahindra.com/OurGroup/management_bod.html#arunnandahttp://www.mahindra.com/OurGroup/management_bod.html#narayanvaghulhttp://www.mahindra.com/OurGroup/management_bod.html#asgangulyhttp://www.mahindra.com/OurGroup/management_bod.html#rkkulkarnihttp://www.mahindra.com/OurGroup/management_bod.html#anupampurihttp://www.mahindra.com/OurGroup/management_bod.html#thomosmathewhttp://www.mahindra.com/OurGroup/management_bod.html#anandmahindrahttp://www.mahindra.com/OurGroup/management_bod.html#deepakparekhhttp://www.mahindra.com/OurGroup/management_bod.html#nadirgodrejhttp://www.mahindra.com/OurGroup/management_bod.html#mmmurugappanhttp://www.mahindra.com/OurGroup/management_bod.html#bharatdoshihttp://www.mahindra.com/OurGroup/management_bod.html#arunnandahttp://www.mahindra.com/OurGroup/management_bod.html#narayanvaghulhttp://www.mahindra.com/OurGroup/management_bod.html#asgangulyhttp://www.mahindra.com/OurGroup/management_bod.html#rkkulkarnihttp://www.mahindra.com/OurGroup/management_bod.html#anupampurihttp://www.mahindra.com/OurGroup/management_bod.html#thomosmathewhttp://www.mahindra.com/OurGroup/management_bod.html#kushubmahindra7/30/2019 Gurpreet Guru
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PUNJAB TRACTORS LTD EQUITY SHAREHOLDING PATTERN AS ON 31st
Dec,2012
1 Mahindra Group 64.64%
2 LIC/GIC/IFCI/BANKS 22.75%
3 Mutual Funds / Banks 2.37%
4 Other FIIs 0.44%
5 Public 9.80%
PRODUCT LINE
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TRACTOR RANGING FROM 24 h.p TO 75 h.p
FORKLIFTS
HARVESTING COMBINES
AUTOMOTIVE CASTINGS
DIESEL ENGINES
AUTOMOTIVE SEATING AND COMPONENTS
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LOCATION
The plant of Punjab Tractors Limited is located in Mohali Focal Point Estate near
Chandigarh on Chandigarh-Ludhiana Highway (Phase IV, Sahibzada Ajit Singh Nagar,
(Mohali) Punjab State) on a campus of 17 hectares. Punjab Govt. in the developing
Mohali to add to the vigorous effects to make it a progressive Industrial Centre allotted
the land. The location of plant is very suitable because it is quite near to the capital of
Punjab. This fact has been advantageous to the company in its initial stage of growth.
However, the inadequacy of railway facilities is a serious drawback to the location of the
plant.
BRAND NAME SWARAJ
The word SWARAJ in Indian language means freedom from bondage. Since PTL was
the first large-scale project in India based totally on Indian know how and technology,
Swaraj was appropriately chosen as its brand name. With more than 5 Lac tractors and
harvest combines operating in Indian farms, now Swaraj is also an internationally
recognized name in the developing world Viz. East Africa, West Africa, Middle East and
South East Asia, etc.
ASSOCIATE UNITS OF PTL
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SWARAJ FOUNDARY DIVISION.
It was established in 1980 at a capital outlay of Rs. 1.80 crores to provide gray iron
castings to PTL. Initial production was 5000 MT/year. It is situated in village Majari in
Mohali district. In FY 2007-08 production of castings was 10600 MTS, representing a
value of nearly Rs. 52 crores.
SWARAJ COMBINE DIVISION (SCD).
Recognizing the pioneering role of PTL, Punjab government requested PTL for the
development and manufacture of self-propelled. Harvester combines to curtail the
harvesting season and save the crops from natural calamities. As a result Swaraj Combine
Division was set up in 1980 at Chappercheri to produce 250 combines per annum at an
initial investment of Rs. 2.65 crores. In 1981, first SWARAJ 8100 rolled out. In 1985,
production of diesel forklift also started in collaboration with KOMATSU Fork- Lift
Company of Japan. Over last 26 years, the company has sold nearly 5000 combines
including 353 in 2010-11.
SWARAJ AUTOMOTIVES LTD.
Earlier it was Punjab Scooters Ltd. But now it has become Swaraj Automotives Ltd. In
1979, PTL took up the rehabilitation of this terminally sick unit and adopted a radically
new technology for it. It is situated in Nabha district Patiala.
OVERVIEW OF VARIOUS FRONTS OF PTL
I. MANUFACTURING. Today the product range of PTL consists of
1. Tractors. Swaraj 722 Swaraj 834
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Swaraj 733 Swaraj 939
Swaraj 724 Swaraj 744
Swaraj 735 Swaraj 855
Swaraj 855 Swaraj 978
2. Forklifts: Swaraj Komatsu Electrical Forklifts. (FB-15, FB-20, FB-255)
Swaraj Diesel Forklifts.(FD-15, FD-20, FD-25)
Swaraj Rough Terrain Diesel Forklifts.(FS-15, RT, FD-20, RT, Fd-
25 RT)
3. Harvester/ Combine: Swaraj 8100
4. Diesel Engines.
5. Automotive Castings.
II. TECHNOLOGY
PTL is the first manufacturer of tractors in the country. To have a conveyerised assembly
line, PTL has totally indigenous technology unlike other manufacturers who have
technical collaborations with foreign manufacturers.
The relative advantages of PTL over the other manufacturers are:
All the models can be made on single assembly where the others like M & M like
different lines for different models.
The assembly line is conveyerised.
Capacity addition will let it tap the current upsurge for the tractors. PTL has been
operating close to 100% utilization levels for the past 6 years. The added capacity will
improve its production capacity to meet the strong demand.Against the high market
share in the 30-40 HP segment capacity constraints have restricted PTLs share in 40 HP segment, PTL is expected to gain market share in these segments once
the added capacity is in the place.
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III. RESEARCH AND DEVELOPMENT
Ever since the beginning R & D has been the basic strength of PTL. The long list of new
products, which have been introduced and established in the short time span of 28 years
of PTLs existence, proves the emphasis that is placed in PTL on Research and
Development.
The expenditure on R & D has increased over the years. It was .47% of total turnover in
2000, .64% in 2001 and 1.46% in 2004. Computer Aided DesignsFacilities for design
and development of products as well technology and tool design have also been
strengthened.
IV. QUALITY OF PRODUCTS
Quality in the vital area where the company refuses to compromise. By putting Dr.
Jurans total quality management techniques into practice, the company has not only
managed to give the customer value for money but Quality in the vital area where the
company refuses to compromise. By putting Dr. Jurans total quality management
techniques into practice, the company has not only managed to give the customer value
for money but
Has managed to reduce wastage as well. To double upon, the company has also been
building long-term relationship with its vendors and dealers.
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1965 Govt. of India's research institute(CMERI) at Durgapur initiates design
and development ofSWARAJ tractor based on indigenous know-how.
1966 Punjab Govt. through PSIDC acquires SWARAJ tractor's design from
CMERI and establishes Punjab Tractors Ltd. (PTL) for its
commercialization.
1971.73 PTL sets up SWARAJ Project for 5,000 tractors per annum at a capital
outlay of Rs. 37.0 million with an equity base of Rs 11.0 million
1974 Swaraj 724 (26.5 HP) tractor commercially introduced.
1975 2nd tractor model SWARAJ 735(39 HP) developed by own R&D,
commercially introduced.
1978 3rd Tractor model SWARAJ 720 (19.5 HP) developed by own
R&D, commercially introduced.
1980 Guided by social concerns and responsibility, PTL takes over
PSIDC's sick scooters unit - Punjab Scooters Ltd. (subsequently
renamed as SWARAJ Automotives Ltd.)
India's first Self propelled Harvester Combine - SWARAJ 8100
developed by own R&D, commercially introduced.
SWARAJ Foundry Division set up in Backward area
1983 4th Tractor Model - SWARAJ 855 (55 HP) developed by own R&D,
commercially introduced.
Expansion of annual capacity to 12,000 tractors per annum at Plant 1.
1984 SWARAJ MAZDA Ltd.promoted in technical and financial
collaboration with Mazda Motor Corpn. & Sumitomo Corpn. Japan for
manufacture of Light Commercial Vehicles. PTL's equity participation
is Rs. 30.4 million (29%) and that of Mazda and Sumitomo's Rs. 27.0
million (26%).
1985 SWARAJ Industrial Forklift Trucks developed by own R&D,
commercially introduced.
1986 SWARAJ ENGINES Ltd. promoted in technical and financial
collaboration with Kirloskar Oil Engines Ltd.(KOEL) for manufacture
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of diesel engines. PTL's equity participation is Rs. 6.9 million (33%)
and that of KOEL's Rs 3.6 million (17%).
1993 Annual tractor capacity expanded to 24,000 per annum at Plant 1.
1994 Setup of tractor Plant II at Village Chappercheri with annual capacity
of 12,000 per annum.
1998 Commencement of expansion to 60,000 tractors(30,000 at each plant).
1999 5th and 6th tractor models - SWARAJ 733 (34 HP) & SWARAJ 744 (48
HP) developed by own R&D, commercially introduced.
2001 PTL won National Championship trophy in competition organized by
All India Management Association (AIMA) for young managers.
Economic times and Boston Consulting Group selects PTL as one of
the India's finest 10 companies out of Economic times top 500
Companies.
2002 Cumulative tractor sales crosses 5,00,000.
2004 PSIDC's disinvestment of its entire Equity holding (23.49%) in PTL in
favour of CDC Financial Services (Mauritius) Ltd. With this, total
holding of CDC & its associates in PTL stands at 28.48%.
2006 7th & 8th tractor models - Swaraj 939 (41 HP) & Swarj 834 (34 HP)
developed by own R&D, commercially introduced.
2008 PTL disinvested 15,73,000 euity shares of Rs. 10/- each of Swaraj
Mazda Ltd. (constituting approx. 15% of SML's paid up capital) in
favour of Sumitomo Corporation, Japan, a joint venture partner in
Swaraj Mazda Ltd. at a total consideration of Rs. 629.2 million
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2010 CDC/Actis Group and Burman Family's disinvestment of their
Equity holding in PTL (43.3%) in favour of Mahindra Group
(M&M).
M&M made open offer to shareholders for another 20% equity of the
Company.
Mahindra Group's equity holding in the Company stands at 64.6%
Cumulative Tractor Sales cross 600,000.
Swaraj Track Type Combine designed and developed by in-house
R&D, commercially launched
2012 Swaraj 3 Tonne Battery forklift, designed and developed by in-house
R&D, commercially launched
QUICK FACTS
Year of establishment 1970
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Business Group Swaraj tractor
Registered Office Phase 4 , industrial area S.A.S Nagar
(MOHALI) Punjab
Listing & its codes NSE: PUNJABTRAC
BSE: 500344Corporate Office Sector 34 A, Chandigarh
Tele- +(91)-172-2647700
FAX : +(91)-172-2615111
Website WWW.SWARAJENTERPRISE.COM
CORPORATE MISSION STATEMENT
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1. To produce and sell quality products with distinctive features at reasonable
prices and with better than the best sales services to ensure durable
satisfaction to customers.
2. To create a culture where each employees, vendor and dealer feels he is an
owner and part of the family.
3. To provide consistently superior return to shareholders and financial stock
holders.
4. To conduct business with highest standard of corporate behaviour, integrity
and social ethics.
SWOT ANALYSIS OF PUNJAB TRACTORS LIMITED
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Strengths
PTL has four constituencies to create wealth:
(a) Farmers
In an era where tractors were manufactured by players with foreign
collaboration (without adapting to Indian conditions), PTL introduced its rugged,
simple-to-maintain tractor, keeping in mind the Indian farmer and the environment,
he operates in. This market, the beginning of treating customers as the extension of
the company.
This is the only company that donot treat spares as profit center. It supplies all
the parts at cost to the dealer, and keeps the cheque that the same is passed on to the
farmer. In contrast, all other tractor makers make more margins on spares than
tractors.
(b) Dealers
Swaraj dealers are more charge, loyal and consequently affluent, PTL has left the
dealership neither has the company as terminated any services. Top managementcarried out direct talk with the dealers, listen to their problems and provide the
solution.
(c) Share Holders
1. Unlike others, PTL does not succumb to the temptation of drifting away into other
business or putting with borrowed funds. It prefers to pay the dividend to the
shareholders which has been increased from 250% last year to 260% this year.
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2. PTL has highest operating margins. This can be attributed to its R & D efforts and
efficient manufacturing system. These coupled with efficient vendor managed
could be termed as the tangible side of the business.
3. PTL boasts of Indias first totally indigenous tractor industry with 98% of the
products developed internally.
4. Another strength of PTL is its efficient vendorisation. It has now transferred even
tricky component such as hydraulic control valves, gears (transmission and
differential), shafts, crown wheels and tail pinions to its vendors. This has enabled
the company to expand efficiently at low capital costs.
(d) Human Resource Strengths
The current manpower costs less than 4 % of sales. This is attractive as
against the industry average of 10.3%.
There is an essence of commitment among the employees. PTL has best of
top management talents in the form of Mr. Chander Mohan and Mr. Yash
Mahajan. Mr. Yash Mahajan (the current Managing Director of PTL) has the
credit of building a strong management team and a formidable middle
management.
WEAKNESSES.
1. Production Capacity
The production capacity does not match the sales potential. Continuous
efforts are being made to increase the capacity. Success has been achieved and
this year it has achieved the target of 50,700 tractors.
2. Lack of Good Market Share in East and South
PTL share has good market share in northern belt. PTL still has to
establish itself in east and south. PTL covers east and south through its 33 and 49
dealers respectively.
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OPPORTUNITIES
1. Potential is the domestic market is large because India is a agricultural country
and 70% of its population is in rural areas out of which 63% of the population
derive their livelihood from agriculture.
Thus the opportunities for Swaraj Tractors is large in the domestic sectors.
THREATS
1. The major threat to PTL is from the new tractor manufacturers especially the
foreign players like New Holland. They are likely to up their in the upper segment
that is in the higher H.P. tractors. People tend to buy the higher H.P. tractors just
to maintain their standard of living.
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CHAPTER THREE
OBJECTIVES OF THE STUDY
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OBJECTIVES OF THE STUDY
1. To see the impact of infrastructure of the tractor dealer on the sales.
2. Level of importance of different aspects of infrastructure.
3. What is the nature and degree of correlation between the infrastructure of
tractor dealer and sales of tractors.
4. Should there be prescribed infrastructure for the tractor dealer.
5. To know the investment done in spare parts by the company.
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CHAPTER FOUR
RESEARCH METHODOLOGY
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RESEARCH METHODOLOGY
Every project works requires research . The successful of any project and
getting the result from that depends upon the research methodology used by the research
the researcher.
RESEARCH DESIGN
According to Ghauri and Gronhaug (2005), depending on the nature of the problem the
research could be exploratory, descriptive or casual.
Exploratory research: it is used to identify and explain the nature of the problem.
It enables manager to better understand the problem. According to Zinkmund
(2000), the purpose of exploratory research include, diagnosing a situation,
screening alternatives and discovering new ideas. Ghauri and Gronhaug (2005)
stated thatexploratory research is mostly used when the research problem is
unstructured i.e. Badly understood, not well know or the other knowledge is not
absolute. According to Yin (1994), interview is the best method when gathering
information in an exploratory research.
Descriptive research: according to Ghauri and Gronhaug (2005), descriptive
research is used when the problem is structured i.e. it gives answers to who,
where, what, how and when questions. It is used to make clear the distinctiveness
of a population or an observed fact. According to Zinkmund (2000), descriptive
research studies are based on some previous understating of the nature of the
research problem.
Casual research: according to Ghauri and Gronhaug (2005), in casual research,
the problems are also structured. Causal research has to do with cause and effect
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relations. The main purpose in such research is to isolate cause(s) and tell whether
and to what extent cause(s) result (s) in effect (s).
In this research, descriptive research was used i.e. explaining the distinctiveness of the
observed facts.
RESEARCH APPROACH
According to Saunder et al (2003), when deciding the research approach to use in a
survey, a selection can be made between deductive and inductive approach.
Deductive approach has to do with the building up of theory and hypothesis after
reading literatures i.e. testing theory.
Inductive approach has to do with development of theory from analysis of
collected data i.e. building theory.
In this we deal with the detail of research methodology employed in this
project.Since the project was to study the infrastructure of tractor dealers, so it was
necessary to meet the dealers and know about the customer perception. Now a days the
customer have become more conscious. The customer sitting in the remote village has the
access to newspaper, Radio and Television. Hence we can say that the information
provided by the media leaves a exuberant effect on the customer taste.
All these above reasons prompted me to go for the primary data
collection.
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DATA COLLECTION METHOD
According to Hussey and Hussey (1997), all research has a primary stage which they
must pass through and this include;
Defining the research problem
Determining the concept of the research
Collecting the necessary data for the research
Analyzing and interpreting the research data
Stating the findings and recommendations
To test the hypothesis developed in this report, a quantitative research method was
used.
The objective of quantitative research is to develop and employ mathematical model,
theories and /or hypotheses pertaining to natural phenomena. It can also be used to
correct and incorporate previous knowledge.
A quantitative research method uses a large number of subject and anything measurable.
It enables one to establish conceptual models and frameworks and also to know some
vital variables and analyse the connection between them. When using a quantitative
research method, a literature review helps to get a better understanding of the research
topic.
Using of past data, that is reviewing the literature on the topic of interest is important
when conducting a research i.e. the researcher present past theory into his/her own area of
concern as presented in the chapter two of this project report. In other words, a clear
description of the research data gathering processes will be presented in this chapter.
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Basically there are two method of data collection
1. Primary data collection method
2. Secondary data collection
Secondary Data. According to Ghauri and Gronhaug (2005, 91), this can be
referred to as information collected by others for certain purposes that can be
different from that of a researcher who intends to use the same information. These
types of data can also be called second hand data due to the fact that they were not
collected for a particular purpose but can be of importance to several researchers
at different time. The external sources include the collection of data from
published articles, books, research reports etc. as well as commercial, panel
research, reports etc. This type of data can also be gathered from online sources
which may include web pages of government organizations, companies,
symposium, seminar etc., Secondary data therefore saves time as well as money,
it helps to better understand and explain our research problem, broaden the base
from which scientific conclusion can be drawn etc. All these are because it is analready existing data that can be used almost at any time it is needed. For this
study, secondary data were gathered from books, journal and articles using the
university library as well as the through internet e.g. Google scholar.
Primary Data. This can be referred to as first hand data because it is collected
mainly for the set research purpose. This type of data often helps to give
appropriate answers to research questions.
According to Ghauri and Gronhaug (2005), peoples behaviours can hardly be
learnt about without asking questions directly of the people involved.
Primary data is generated where a particular problem at hand is investigated bu
researcher employing the questionnaires, telephone surveys, interviews, etc. But in
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secondary data collection method, data which is collected for some earlier research work
and is applicable in present research.
In our research no secondary data is available so we using primary source
of data collection. The method of data collection is through structure undisguised
questionnaires and the copy of such questionnaire is in the appendix. In structure
undisguised questionnaire the responses as well as questions are standardised because of
the subjects are limited to the fixed alternatives. This type of questionnaire is very helpful
in securing factual information. In our study we have to obtain the information about
infrastructure and sales of the tractor dealers which is factual information.
SAMPLING PLAN
1. Sampling Unit: The sample chosen for the study was the tractor dealers at
Patiala
2. Sampling Procedure : The sampling procedure for this project was convenience
sampling.
RESEARCH INSTRUMENT
The research tool used for collecting the data was a questionnaire. The
questionnaire mainly consisting of dichotomous and multiple choice questions.
Although to get exact information it is available to interview the whole of the
population. But due to time and other constraints this is not possible. So it become
necessary to choose a sample.
3. DATA ANALYSIS: Once the data was collected the next step was the proper
tabulation of the data for its analysis. The data collected was properly tabulated
and fed into computers in different packages. Then the data was analysed, aided
by different tables formulated and inferences were drawn out.
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RELIABILITY AND VALIDITY
Reliability and validity is used to reduce the risk of bias responses when applying a
theory to empirical findings. According to Saunder et al (2003), reliability differs from
validity in the sense that reliability has to do with generalisation of the result and validity
has to do with whether the observation shows reality.
validity has to do with the reality of our finding Validity can also be defined as the extent
to which a study correctly shows the particular theory that the researcher is trying to
measure. External and internal validity was a major concern for the researcher.
External validity has to do with generalization of the result. There are several
ways of assessing external validity, for example taking of random sampling as it
is done in politics.
Internal validity has to do with the design of the study, care taken to carry out the
measurement, decision take as to what should be measured and what should not
be measured and the extent to which the researcher have taken into consideration
their explanation for other casual relationship the noticed.
In order to increase the validity of this research, the research is based on past literatures
and theories which have concrete and convincing conclusion and also validated by
experts.
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QUESTIONNAIRE CONSTRUCTS
A structured questionnaire was constructed to indicate the impact of tractor Dealer
Infrastructure and its effect on sales
RESEARCH BOUNDARY
1. Only dealer survey is done, no consumer survey is done.
2. Area of research is restricted to Patiala district.
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CHAPTER FIVE
DATA ANALYSIS AND INERPRETATION
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Table 1. Status of the Showroom
Number Percentage
Self Owned 5 62
Rented 3 38
Sample Size = 8
Showroom
62%
38%
Self Owened
Rented
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Table 2. Size of Showroom
Tractor Dealer Showroom Size
(in sq. Feet)
Mahindra & Mahindra 500
Swaraj 250Tafe 225
Eicher 1200
John Deer 1000Farmtrac 1500
Same Greaves 180
Sonalia 200
Average size of the showroom in Patiala district is 632 sq. Ft
Sample Size = 8
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500
250 225
1200
1000
1500
180 200
0
200
400
600
800
1000
1200
1400
1600
Showroomsize(insqft)
M & M Swaraj Tafe Eicher John
Deer
Farmtrac Same
Greaves
Sonalika
Tractor Dealer
Size of the showroom
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Table 3. Tractor display Area
Tractor Dealer Area ( in sq ft )
Mahindra & Mahindra 250Swaraj 250
Tafe 750
Eicher 100John Deer 500
Farmtrac 500
Same Greaves 50
Sonalika 225
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Tractor Display Area
0
100
200
300
400
500
600
700
800
Mahi
ndra
Swaraj
Tafe
Eich
er
John
Deer
Farmtra
c
SameG
reav
es
Sonalik
a
insq.
ft
44
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Table 4. Size of the Workshop
Tractor Dealer Workshop Size
(in sq. Ft)
Mahindra & Mahindra 400
Swaraj 550Tafe 300
Eicher 1000
John Deer 600
Farmtrac 1000Same Greaves 100
Sonalika 200
Sample Size = 8
Average size of the workshop in Patiala district is 520 sq. Ft
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Size of the Workshop
400
550
300
1000
600
1000
100
200
0
200
400
600
800
1000
1200
Mahindra
&
Mahindra
Swaraj Tafe Eicher John Deer Farmtrac Same
Greaves
Sonalika
Tractor Dealer
WorkshopSize(insqft)
46
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Table 5. Investment in Tractors
Tractor Dealer Investment(in lac)
Mahindra & Mahindra 25Swaraj 65
Tafe 15
Eicher 25John Deer 60
Farmtrac 57
Same Greaves 15Sonalika 45
Average investment in tractor in Patiala district is 38.3 lac
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Investment in Tractors
25
65
15
25
60
5715
45
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Investment in Spare Parts
6
5
2
45
10
1 2
Mahindra & Mahindra Swaraj Tafe
Eicher John Deer Farmtrac
Same Greaves Sonalika
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Table 7. No of Manager and salesman each tractor dealer have
Tractor Dealer No of
Managers
No of salesman Total
Swaraj 2 6 8
Tafe 2 3 5
Eichor 2 3 5Johndeer 2 1 3
Farmtrac 2 8 10
Same Greaves 1 1 2Sonalika 2 2 4
Mahindra & Mahindra 2 5 7
Average number of Manager each dealer has to
Average number of employees each dealer has 4
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Staff
0 2 4 6 8 10
Mahindra
Swaraj
Tafe
Eicher
Jhon Deer
Farmtrac
Same Greaves
Sonalika
Manager Salesman
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Table 8. Market share of each tractor dealer for the year april 2011 to march 2012
Tractor dealor Sales(in numbers) Market share in
Patiala dist.
Mahindra & Mahindra 259 17.08Swaraj 359 27.82
Tafe 70 3.22
Eicher 120 5.26John Deer 185 14.50
Farmtrac 343 27.18
Sonalica 56 2.69
Same Greaves 48 2.26
Total number of tractors sold in Patiala district for the year 2011-12 was 1440
Average number of tractor sold by each dealer was 240
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Sales of each tractor dealer in Patiala for the year
2011-12
259
359
70
120
185
343
56 48
0
50
100
150
200
250
300
350
400
Mahindra &
Mahindra
Swaraj Tafe Eicher John Deer Farmtrac Sonalika Same
Greaves
Tractor Dealer
Sales(inNo.)
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To see the correlation between the showroom size and sales
Tractor Dealer Sales(Avg.)
R1 Showroom sizein sq ft
R2 D2
= (R1-R2)
Mahindra &
Mahindra
150 6 500 5 1
Swaraj 235 7 250 4 9
Eicher 44 4 1200 7 9
Tafe 26 2 225 3 1
John Deer 128 5 1000 6 1
Farmtrac 255 8 1500 8 0
Same Greaves 15 1 180 1 0
Sonalika 33 3 200 2 1
22
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Rank Correlation
r = 1- 6 D2
N3 - N
= 1 - 622
83 8
= 1 - 132
504
= 1 - 0.26
= 0.74
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To check the correlation between sales and showroom
condition
Tractor Dealer Sales
(Avg.)
R1 Showroom
condition
R2 D2 = (R1-R2)
Mahindra &
Mahindra
150 6 Good 3 9
Swaraj 235 7 Very Good 5.5 1.25
Eicher 44 4 Average 1.5 6.25
Tafe 26 2 Very Good 5.5 12.25
John Deer 128 5 Average 1.5 12.25
Farmtrac 255 8 Excellent 8 0
Same Greaves 15 1 Very Good 5.5 20.25
Sonalika 33 3 Very Good 5.5 6.2567.50
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Rank correlation
r = 1 6 [ D2 + 1/12 (m3 m) + 1/12 (m3 m) ]
N3 N
= 1 -6 [ 67.5 + 1/12 (23 2) + 1/12 (43 4) ]
83 8
= 1 6 (67.5 + 0.5 + 0.5)
521 8
= 1 6 68.5
504
= 1 - 0.81
= 0.19
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To check the correlation between sales and workshop size
Tractor Dealer Sales
(Avg.)
R1 Workshop size in
sq ft
R2 D2 = (R1-R2)
Mahindra &
Mahindra
150 6 400 4 4
Swaraj 235 7 550 5 4
Eicher 44 4 1000 7.5 12.25
Tafe 26 2 300 3 1
John Deer 128 5 600 6 1
Farmtrac 255 8 1000 7.5 0.25
Same Greaves 15 1 100 1 0
Sonalika 33 3 200 2 123.50
r = 1 6 [ D2 + 1/12 (m3 m) ]
N3 N
= 1 6 [ 23.5 + 1/12 (2 3 2) ]
83 8
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= 1 6 [23.5 + 0.5]
512 8
= 1- 6 24
504
= 1 0.28
= 0.72
To see the correlation between the sales and the investment in
tractor and spares
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Tractor Dealer Sales
(Avg.)
R1 Investment in
tractor & spares
R2 D2 = (R1-R2))
Mahindra &
Mahindra
150 6 25 + 6 = 31 4 4
Swaraj 235 7 65 + 5 = 70 8 1
Eicher 44 4 25 + 4 = 29 3 1
Tafe 26 2 15 + 2 = 17 2 0
John Deer 128 5 60 + 5 = 65 6 1
Farmtrac 255 8 57 + 10 =67 7 1
Same Greaves15 1 15 + 1 =16 1 0
Sonalika 33 3 45 + 2 = 47 5 4
11
r = 1 6 D2
N3 N
= 1 6 11
83 8
= 1 66
512 8
= 1 0.13
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= 0.87
To see the correlation between the sales and Tractor display
area
Tractor Dealer Sales
(Avg.)
R1 Tractor display
Area (in sq ft.)
R2 D2 = (R1-R2)
Mahindra &
Mahindra
150 6 250 4.5 2.25
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Swaraj 235 7 250 4.5 6.25
Eicher 44 4 100 2 4
Tafe 26 2 750 8 36
John Deer 128 5 500 6.5 2.25
Farmtrac 255 8 500 6.5 2.25
Same Greaves 15 1 50 1 0
Sonalika 33 3 225 3 0
53
Rank correlation
r = 1 6 [ D2 + 1/12 (m3 m) + 1/12 (m3 m) ]
N3
N
= 1 6 [53 + 1/12 (23 2) + 1/12 (23 2)]
83 8
= 1 6 [53 + 0.5 + 0.5]
512 8
= 1 6 54
504
= 1 0.64
= 0.36
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To see the correlation between the Sales and Sale Staff
Tractor Dealer Sales
(Avg.)
R1 Sale Staff R 2 D2 = (R1-R2)
Mahindra &
Mahindra
150 6 6 6 0
Swaraj 235 7 7 7 0
Eicher 44 4 4 5 1
Tafe 26 2 3 4 4
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John Deer 128 5 2 3 4
Farmtrac 255 8 9 8 0
Same Greaves 15 1 1 1.5 0.25
Sonalika 33 3 1 1.5 2.25
11.50
Rank correlation
r = 1 6 [ D2 + 1/12 (m3 m) ]
N3 N
= 1 6 [11.5 + 1/12 (23 2) ]
83 8
= 1 6 [ 11.5 + 0.5 ]
512 8
= 1 6 12
504
= 1 0.14
= 0.86
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To check the correlation between the sales Managerial Staff
Tractor Dealer Sales
(Avg.)
R1 Managerial Staff R2 D2 = (R1-R2)
Mahindra & Mahindra 150 6 2 7 1
Swaraj 235 7 1 3 16
Eicher 44 4 1 3 1
Tafe 26 2 1 3 1
John Deer 128 5 1 3 4
Farmtrac 255 8 2 7 1
Same Greaves 15 1 1 3 4
Sonalika 33 3 2 7 16
44
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Rank correlation
r = 1 6 [ D2 + 1/12 (m3 m) + 1/12 (m3 m) ]
N3 N
= 1 6 [44 + 1/12 (53 5) + 1/12 (53 5)]
83 8
= 1 6 [ 44 + 10 + 2 ]
512 8
= 1 6 56
504
= 1 0.66
= 0.33
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CHAPTER SIX
FINDINGS OF THE STUDY
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FINDINGS OF THE STUDY
Analysis the outcome of the survey conducted . The first and foremost thing that become
clear is that Mahindra & Mahindra and Swaraj are enjoying the top position in the tractor
industry . They are having the market share of 34.3% and 18.3% respectively. So , it is
clear that Swaraj is at the second position .
Regarding the dealers infrastructure it is clear that infrastructure do effect the sales .
The effect of the different area has been analysed using rank correlation method .
The highest is the correlation , it has the more relationship with the sales , i.e. it effects
the sales .
The least is the correlation , it has no effect on sales .
It is found that the highest impact on sales is the investment in tractor and spares by
tractor dealer . It has the correlation of 0.87
After the investment the second comes sale staff with the correlation of 0.86
After that sales depand upon the showroom size with the correlation of 0.74
After that sales depands upon the size of workshop with the correlation of 0.72
After sales is effected by tractor display area with the correlation of 0.36
After sales is effected by managerial staff with the correlation of 0.33
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After that the least factor which effects the sales is condition of showroom with the
correlation of 0.19
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CHAPTER SEVEN
LIMITATIONS OF THE STUDY
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LIMITATIONS OF THE STUDY
Although sincere efforts were made to collect authentic and reliable information
from the respondents even then this report is subjected to certain limitations.
1. As all the results and conclusions have drawn on basis of information
supplied by dealers, so it may lead authentic results.
2. The study was limited only to the area of district Patiala.
3. Information provided by dealers, it cannot be denied that there was
always a danger of individual biased.
4. Though the Questionnaire was prepared with great care and keeping all
aspects in mind but then we might have missed some points from which
we can get further information.
5. Since no T.A. is given as per company norms therefore it was difficult to
cover up wider area. The sample was collected using convenience
sampling techniques6. The qualitative nature of the research also makes it difficult to analysed
and interpret records.
7. Another noticeable limitation is the factor of time and financial
constraints; much of secondary data has been used in this present study.
If there had been enough time available, more fast food restaurants would
have been surveyed to gather more primary data.
8. Time of day for which survey was conducted too was morning hours to
lunch hours. evening hours were not considered.
9. Sample size too was limited as only dealers viewpoint is discussed here.
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CHAPTER EIGHT
CONCLUSION
&
RECOMMENDATIONS
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CONCLUSION & RECOMMENDATIONS
The factor which are considered important for good infrastructure are given below :-
1. Investment in tractor and spares .
2. Availability of sales staff .
3. Size of showroom .
4. Size of the workshop .
5. Availability of service staff .
The above factors are in the ordered of preference . So , the dealer should develop the
infrastructure in the above order to give a boost to their sales .
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CHAPTER NINE
FUTURE RESEARCH
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FUTURE RESEARCH
I think it will be of interest for researcher to map the impact of the showroom
infrastructure on the sales of the tractors.
future can also be done by making an exploratory study with interviews of managers at
the sites.
I dealt equally with all the items in my survey. Some may have weighed more than others
which may provide me with misleading results. In other words, a future research can be
done by keeping some other parameters of sales and showrooms.
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CHAPTER TEN
REFERENCES
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REFERENCES
1. Kolter, ,philip marketing management
2. S.P, ,gupta statical methods
3. C.R, kothari research methodology
4. http://www.swarajenterprise.com/
5. http://www.ruf.rice.edu/~bioslabs/tools/report/reportform.html
6. http://www.tractordata.com/farm-tractors/tractor-
brands/swaraj/swaraj-traPage 80 of 84ctors.html
7. http://wwwautomobiles.indiabizclub.com/info/automobile_types/tract
ors
8. http://www.en.wikipedia.org/wiki/Tractors_in_India
9. http://www.tractordata.com
10. http://www.business.mapsof India.com
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ANNEXURE
1. NAME OF DEALER
___________________________________________
2. COMPANY NAME TO WHICH SHOWROOM BELONGS
_________________________________________
_
3. STATUS OF SHOWROOM (TICK APPROPREATE)
SELF OWNED
RENTED
4. APPROXIMATE SIZE OF THE SHOWROOM
--------------------------- Square Feets
5. WHETHER YOU HAVE A SEPRATE
(a) TRACTOR DISPLAY AREA
YES NO
(b) CABIN FOR MANAGER
YES NO
(c) CABIN FOR PROPERIETOR
YES NO
6. WHAT IS THE SIZE OF WORKSHOP
------------------------------- Square Feet
http://www.swarajenterprise.com/http://www.ruf.rice.edu/~bioslabs/tools/report/reportform.htmlhttp://www.tractordata.com/farm-tractors/tractor-brands/swaraj/swaraj-tractors.htmlhttp://wwwautomobiles.indiabizclub.com/info/automobile_types/tractorshttp://wwwautomobiles.indiabizclub.com/info/automobile_types/tractorshttp://www.en.wikipedia.org/wiki/Tractors_in_Indiahttp://www.swarajenterprise.com/http://www.ruf.rice.edu/~bioslabs/tools/report/reportform.htmlhttp://www.tractordata.com/farm-tractors/tractor-brands/swaraj/swaraj-tractors.htmlhttp://www.tractordata.com/farm-tractors/tractor-brands/swaraj/swaraj-tractors.htmlhttp://wwwautomobiles.indiabizclub.com/info/automobile_types/tractorshttp://wwwautomobiles.indiabizclub.com/info/automobile_types/tractorshttp://www.en.wikipedia.org/wiki/Tractors_in_India7/30/2019 Gurpreet Guru
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7. WHETHER YOUR WORKSHOP HAS
(a) WASHING ARRANGEMENTS
YES NO
(b) PAINTING FACILITY
YES NO
8. WHAT IS YOUR INVESTMENT IN TRACTORS
Rs ----------------- lacs
9. WHAT IS YOUR INVESTMENT IN SPARES
Rs----------------- lacs
10. NUMBER OF EMPLOYEES IN SHOWROOM
MANAGERS : ------------SALESMAN : ------------
11. SALES OF TRACTORS
PERIOD NUMBER
2010-11 -----------
2011-12 -----------
____________________________________________________________________
_
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THANKS FOR YOUR KIND CO-OPERATION
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