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Castrol Case Study SWOT Analysis

Experts advise for castrol case study help available 24/7.

Castrol Limited is a world-leading lubricant expert serving clients across the world with diverse services. The firm is a well-recognized brand that is famous for its inventions and marketing expertise in technology. In January 2006, the general manager of sales at Castrol India Limited was concerned. Sales of Castrol motorcycle oil for four-stroke engines was far less than it should be, especially when considering the five million motorcycles being added to Indian roads each year. Most motorcycle oil changes took place in franchised workshops during the warranty period and in non-franchised workshops after the warranty period. Castrol was likely to lose its market share and its market supremacy in these circumstances. Three major PSUs, with the benefits of owning forwards, were also competing heavily.

They were also exposed to real oil dangers. However, Castrol was able to preserve its leadership and commercial success with technical advancements. In addition, the General Manager examined the market research studies and identified three different customer segments. He has chosen to establish a project team that analyses MCO distribution and wishes to expand sales of Castrol oil in the replacement parts stores and non-franchise shops to serve the increasing aftermarket in India. However, current distributors from Castrol reluctantly sold to the categories they considered to be low-volume, high-cost and hazardous. Obviously, its coverage in the aftermarket would come from replacement parts shops and NFWs for the sale of MCOs.

Regarding the present market scenario, the general manager needed a distribution plan, which would appeal to existing distributors and assist in increasing sales of Castrol Oil without increasing expenditures for the firm. Earlier, the consumers would buy the oil of their choice and take the preferred mechanics to change the oil. Now the consumers depend on the mechanics for the entire process of buying as well as changing the oil.

Consumer Segments

Three distinct consumer segments were identified by Castrol:

  1. Minimalists: People who seek value for the money spent with reassurance from a credible brand. They need to do the "right thing".

  2. Appreciators: The go to reliable sources and are willing to pay the premium if needed. They are willing to be led and advised and appreciate freedom and confidence.

  3. Enthusiasts: They want to be associated with the best and are ready to go to all extents to tap the uncovered opportunities. They believe in getting the most out of the bike engine.

Specific Challenge

Rai and his team intended to acquire a 30 per cent market share in the MCO industry in the following five years. It might have chosen Organic growth, resulting in a rise of 24 per cent in two-wheel market share. But how we can attain the remaining 6% remained the difficult. Another alternative was to take advantage of the NFW market, which Rai and his team were able to reach 6% of the remainder. However, the distributor at Castrol was reluctant to do so for two reasons: first, mechanics were not allowed, and only buy credits that would be high-risk. Next, they were highly fragmented in remote locations. Delivering small quantities would not have been cost-effective in terms of labour and transportation.

SWOT Analysis

Strength

Castrol Franchised has some of the most known domestic brands in which it works, including Strong Brand Equity and Brand Awareness. According to Renuka Kamath, brand awareness is an important factor in drawing new clients to the search for solutions in neighbouring sectors.

The first mover advantage for Castrol Franchised is in several sectors. It has tried in several fields. Castrol Franchised has been able to develop unique ways to tackle the markets without food with Sales & Marketing solutions and tactics.

Weakness

Even with the number of patents and copyrights owned by the corporation, a franchised business model may be simply reproduced. In the sector in which Castrol Franchised works, intellectual property rights are particularly difficult to execute. Renuka Kamath notes that intellectual property rights are helpful in preventing rivalry of the same scale, but starting to interrupt markets in different levels is hard to stop.

Opportunities

The market size has expanded at a rapid rate during the previous decade and a half. New clients have also evolved in consumer preferences and tastes. This poses two significant problems for Castrol Franchise: keeping loyal consumers and dealing with new clients. Castrol Franchised has sought first to diversify with numerous brands and offer other functionalities according to client demands.

Threats

Threats to the Castrol Franchise business model include macro-environmental variables and changes that can derail. Different reasons might threaten, such as - changes in customer tastes, economic growth, advances in technology, changes in policy and political trends and increased consumer disposable money.

PESTEL Analysis

Political Factors

At the national and municipal level, the government runs deficit budgets that stimulate short-term growth but can cause inflation to increase over the medium term. Investment grade is the bond rate of the national government.

Policymaking from the government to the government is consistent. Secondly, all parties' governments adhere to the treaties established by the preceding administrations

Economic Factors

If the employment rate is high, Castrol Franchised will have a double impact - it will supply enough consumers for Castrol Franchised products, and it will make hiring talented and skilled personnel costly for Castrol Franchised.

Increased spending and stagnating household income have led to the consumption of credit binge in the United States. The culture of saves has been devastated as individuals are not enough to save. Castrol Franchised must take care to create a marketing approach that relies on the customer habit of "credit purchasing."

Social Factors

Another strong predictor of future demand is the Birth rate. Because of its somewhat higher birth rate and more immigration, the US avoided a stagnating EU-style economy. Higher levels of social concerns in the society often result in higher consumer activism and pressure from non-governmental organizations & pressure groups.

Technological Factors

One of the areas where the US lacks behind China is Mobile Payments. Castrol Franchised should assess the preferred choice of mobile payments in the local economy and choose the business model based on it.

Countries across the world are trying to prepare themselves to install 5G infrastructure. Castrol Franchised should assess to what level the local market is prepared to roll out the 5G connectivity. For else assignments, writing services you can take plagiarism-free solutions from us.

Environmental Factors

Castrol Franchised must know how much environmental concern is involved in consumer action. It will assist Castrol franchised produce goods that are ecologically friendly and defy PR stumbling hurdles.

Castrol Franchised business model and supply chain will have an influence on climate change. If the supply chain is not flexible, for example, bottlenecks might be caused when supplies from one area of the world are delayed due to a sudden change in the climate.

Legal Factors

The judiciary independence often reflects both strength and credibility of the institutions in the country. Castrol Franchised should not be worried about the monopoly and restrictive trade practices law as a new player. Castrol Franchised has to evaluate what is and needs to be done to comply with the rules on data in the nation. Most EU governments, for example, currently only wish to store EU citizens' data in EU countries.

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