The Indian lubricant industry is currently at a dynamic stage and the future will witness the survival of the players who have the right product mix, right market strategies and the right rela tionship with the employees and the customers.
Pennzoil India Ltd has embarked upon an ambitious mission of becoming the second largest quality lubricant specialist in India over the period of next few years by acquiring a market share of about 8-9 per cent. In the long run the company aims at being the no.1 player in the market.
To achieve this feat, the company carried out an in-depth review of its operations and realised that a major reorganisation and new business prospect was imperative.
During the course of lthe assessment it was found that there was an excess of manpower, which was adversely affecting the compa nys financial position. For the company to be economically viable, reduction in the manpower was essential. Although the contribution of each and every employee is highly valued, the company was compelled to reduce the employee strength from 250 to 180.
Next the company focussed on the technological advancement of its plant facilities at Trubhe. This was possible by infusion of additional Rs 16 crores by the parent company. From this fresh capital, the company progressively invested approximately Rs 4.5 crore in upgrading its laboratory equipment, production and storage facilities, and augmenting product lines, thereby ensuring that the final packaged product out of the plant adheres to the world class Pennzoil quality.
Cost cutting drives introduced by the company at every level, which has reduced the overheads, general and administrative costs by about 40 per cent. The money therefore saved has been diverted into promotional activities.
In an industry marked with heavy competition and low involvement in the product by the consumers, the longevity of a player will be determined by the investment made in the brand building and image. After a comprehensive stj4
rategic review of the marketing activities the company has reorganised the business along brand lines.
This new brand management approach will allow Pennzoil to take full advantage of its powerful brand name, and will focus into the markets where the Pennzoil brand can caputre a meaning ful market share.
Compared to the previous years, the company has significantly increased its investment in brand building for the year 1997. It has spend Rs one per litre more than its competitors in advertis ing. These measures will further strengthen the Pennzoil brand which signifies quality and leadership that understands and cares.
