Identification of the Strategic Issue
Graneer Systems needs to determine the attractiveness of the Indian water purification market and determine the best mode of entry. Graneer needs to determine what life cycle the industry is in, how many competitors exist and what are their competitive strategies, what are the forces in the broad environment and how are they going to inhibit or promote market entry. Graneer also needs to determine the best product design for entering this market and a pricing strategy.
Listing of Alternative Courses of Action
1. Joint working arrangement – Graneer would supply key purifier components to an Indian company which would manufacture and market the assembled product. License fees would be on a per-unit basis over the term of the agreement (typically 5 years with option to renew for 3 more).
2. Joint venture agreement – Graneer would partner with an existing Indian company solely for the purpose of manufacturing and marketing water purifying systems. They would split profits and there would be a buy/sell option after a minimum time period.
3. Acquisition – Graneer would purchase an existing Indian company and expand operations to include the water purifying system. Profits would belong wholly to Graneer.
Analysis of Opportunities and Threats in the External Environment
• Demographic: Chatterjee identified the target market as 44 million households. 50% of the target market currently uses the traditional method of boiling, and boiling and filtering. 40% uses candle filters and water purifying devices. The remaining 10% of the target market was unaware of water problems and did not use any water filtering or purifying system. This is ...