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SectionA Group6 Assignment1

Verklar's market share in the window segment in Austria has dropped from 85% to 75% as competitors have targeted contractors and mid-tier dealers. Verklar is also strongly associated only with roof windows. The current discount system favors only large dealers. The solution proposes focusing on medium dealers and window fitters, encouraging direct ordering from Verklar's warehouse. It also suggests prioritizing architects and builders along with dealers. A new quota system would give discounts for higher volumes and improve margins, inventory control and customer satisfaction while keeping bulk discounts. This is expected to help Verklar increase its market share in Austria.

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Sreejit Janardhanan
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148 views

SectionA Group6 Assignment1

Verklar's market share in the window segment in Austria has dropped from 85% to 75% as competitors have targeted contractors and mid-tier dealers. Verklar is also strongly associated only with roof windows. The current discount system favors only large dealers. The solution proposes focusing on medium dealers and window fitters, encouraging direct ordering from Verklar's warehouse. It also suggests prioritizing architects and builders along with dealers. A new quota system would give discounts for higher volumes and improve margins, inventory control and customer satisfaction while keeping bulk discounts. This is expected to help Verklar increase its market share in Austria.

Uploaded by

Sreejit Janardhanan
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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SDM

Group 6

VERKLAR AUSTRIA CASE


ASSIGNMENT 1

SUBMITTED BYGROUP 6

FT151001

Nivedita Krishnan

FT151053

Sreejit Janardhanan

FT154041

Anand Viswanath

FT151052

Rohan Shah

SDM

Group 6

PROBLEM

As per Mr Nickel, drop in Verklars market share in Austria from


85% to 75% - Competitors have developed more competitive strategies
primarily focussing on contractors and mid-tier dealers where the repeat
order is high

Association of Verklar brand with only roof window segment


Verklar has the maximum share in the roof window segment (85%) and
the name has got associated with it. Moreover Verklar has a very small
sales staff which has reduced the brand recall among the customer

Issues with current discount system The current discount scheme


favours only the large dealers as they are the ones who purchase in bulk
and keep a stock of the inventory. Overstocking increases the handling,
transportation and maintenance cost.

Lesser discounts for smaller dealers and window-fitters The


discount given to the small dealers who buy the products directly from the
Verklar factory is small. Moreover it takes long time for the delivery of
windows when directly bought from Verklar factory. This has resulted in
switching of brands by these smaller dealers and lowering the revenue of
Verklar.

SOLUTIONo

To concentrate on the medium size dealers and window-fitters and


increasing their number in the Verklar distribution system.

Moreover, encouraging them to engage directly with the companys


centralized warehousing and ordering system.

Prioritizing architects, window-fitters and builders along with wholesalers


and dealers

Planning to increase the speed of the channel flow in terms of shipment of


windows from the warehouse as well as increasing the volume of the
windows by stimulating the demand in the channels and thereby increase
the market share.

Implementation of quota system will help Verklar in the following ways

Channel flow to be less hierarchical and more directly with the Verklar
company.

SDM

Group 6

Margins will be better; hence dealers will recommend Verklar products


to customers.
Control over inventory will improve and hence it will be easy to assess
demand for different SKU in its product line.
After sales service along with lower costs will improve the end
customer satisfaction.
Bulk quantity discounts to stay, as it will give the infrequent users more
flexibility to choose the best product.
Availing 29% discount if a purchase of 50 or more windows is made.

CONCLUSIONo
o
o
o
o
o

The new quota system comes out as an innovative solution for Verklar.
Demand forecasting needs to be accurate as Verklar will have to deal with
small dealers as well.
High investment in the inventory management system to have a
centralised warehouse with a faster shipping time.
There can be potential conflicts in the organization due to the
incorporation of new staffs.
Matching competitor discount will be difficult, hence Verklar should
concentrate on quality and product leadership segment
Increasing aggregate profit by emphasizing the large number of volumes
they can sell to small dealers.
These strategies deployed by Verklar and along with promotions, it will
help them to increase their market share and be a leader in the window
segment.

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