Godrej & Boyce: New designs on the market

Mona Mehta in Mumbai

In a bid to meet the evolving needs of its customers, the Rs 120-crore storwel division of the Rs 800-crore Godrej & Boyce Mfg Co. Ltd. is planning to roll out a slew of new products in April 2002. And to support the new launches, the company plans to unveil a host of new marketing initiatives in the near future.

The company has also decided to phase out its entire range of existing storwels from the Indian market by April 2002.

According to Godrej & Boyce vice-president and business head Mr Anil Mathur, the company is launching a new range of storwel economy models targeted at socio-economic classification (SEC) C. It is also focusing on the home furniture segment such as wardrobe (made in steel and wood) to include home decor such as mattresses, in addition to being a solutions provider for office storage systems and expanding the existing volumes of ‘i-space’ range of kids furniture.

...Plans marketing tie-up with Kurl King
Godrej & Boyce is currently in talks with Kurl King Koil, a US-based manufacturer of mattresses, for a marketing tie-up by April 2002. The move is a result of its focus on the home decor and institutional segment. According to Godrej & Boyce Mfg Co vice-president and business head Mr Anil Mathur: “The company will initially import mattresses from Kurl King Koil for two years and then start manufacturing the mattresses in India itself. By introducing mattresses, Godrej & Boyce intends to create a special niche for itself in the home decor segment in addition to furniture”. Once Godrej & Boyce enters into a marketing tie-up with King Kurl Koil for mattresses, the pricing and marketingstrategies for the Indian market would be finalised.

Says Mr Mathur:”Godrej & Boyce would save Rs 3 crore on costs by phasing out its existing range. This amount will be reinvested to generate the new range. The move is aimed at increasing the capacity of manufacturing Godrej storwels by 25 per cent by 2002-end.”

Currently, the company manufactures and markets 1.20 lakh units of Godrej storwels in the Indian market in the capacity of six feet and three feet, priced between Rs 6,000 and Rs 15,000.

Of the Rs 400-crore storwel market to which the organised sector contributes around 20 per cent, Godrej and Boyce has garnered a marketshare of 15 per cent. Today the company competes with regional players such as ‘Gaddre’, ‘Rakesh’, among others, which have achieved a marketshare between five to seven per cent, in the current year, informs Mr Mathur.

In the storwel segment, Godrej & Boyce will introduce economy models of Godrej storwels (priced between Rs 5,000 and Rs 5,500). The strategy ‘configure your dream’ for mass customised storwels will configure the requirements for Godrej storwels depending on consumer’s choice of design and structure (priced between Rs 8,000 and Rs 10,000).

Informs Mr Mathur: “Till now, the company used to manufacture and market a complete range of storwels through dealers. But beginning April this year, dealers will be supplied with wielded parts, partitions and tools to enable them to form a complete storwel depending on consumers’ choice and demand for a particular type of design.”

In addition, Godrej & Boyce will focus on being a solutions provider for office storage systems, says Mr Mathur. For the purpose, the company will extend its product portfolio from manufacturing and marketing company profiles, file folders to launching modular and flexible product range in Indian market very soon. Godrej’s modular and flexible product range will be priced between Rs 5,000 and Rs 15,000.

As regards the marketing strategies, explains Mr Mathur: “The new products will be targeted at architects, interior decorators, corporate offices, among others.”

Godrej & Boyce plans to unleash an aggressive adblitz for the new products through electronic and print media at an investment of Rs 44 crore in April 2002. The company will kick off its test-marketing initiatives for the new product range from February 2002.

Explains Mr Mathur: “Last year, the company reduced the inventory levels by 25 per cent, but with the new initiative, we hope to reduce our inventory levels by an additional 20 per cent by 2003-end which will lead to faster delivery of products.”

In the home furniture segment, the company plans to extend its existing product portfolio in the home furniture segment from sofa sets to include dining sets, wooden beds and wooden bedroom cupboards in 2002. To meet the target, Godrej & Boyce plans to import home furniture from the Malaysia-based company “Masters”, and market them in India. After two years it plans to start manufacturing the range in India itself. Godrej & Boyce currently imports the sofa set range from Masters.

As regards the “i-space” range of furniture targeted at kids, Godrej & Boyce has sold 300 pieces since the past six months and hopes to touch sales of 20,000 pieces in the next couple of years, informs Mr Mathur.

The company has targeted specialised institutional dealers to sell the new range of storwels. In addition, the company plans to add
275 dealers to the existing number of 475 by 2003-end.

Godrej & Boyce expects the storewel market to grow from seven per cent at present to touch nine per cent by 2002-end. The company targets its sales turnover to touch Rs 150 crore and marketshare in the wardrobe segment to grow from 15 per cent to 20 per cent, storwel segment from two per cent to 10 per cent through the economy models and office storage segment from 15 per cent to 25 per cent.