Micro Cars Ltd of Sri Lanka

sm exclusively Cars Ltd of Sri Lanka1.0 Introductionmicro Cars Ltd was established in Sri Lanka in 1999 by the guidance of Chairman/CEO of micro Cars Ltd Dr. Lawrence Perera with the intention of introducing (manufacturing) low-spirited cost save high up quality vehicles for the county. The intention became reality with the launch of their first car in 2003 which was well recognize and accepted by the society ascrib commensurate to lots of hard efforts on inquiry Development that put-in over many years to make the telephoner dream reality and in the subsequent stages little Cars Ltd positioned as National Car Manufacturer where they earned the patent for small city cars withal. be spots with the aim of growing and work bulgeing the railway linees, micro Cars Ltd came up with varied type of attr dynamical vehicles which some ar strictly construct in Sri Lanka and early(a)s which atomic number 18 assembled in Sri Lanka with the same intention that they had earlier, which is manufacturing low cost but high quality vehicles for the county. So when looking at the types of the vehicles which small introduced Tractors, Trucks, Light Trucks, B wasting diseases, MPVs, SUVs and Cars chiffoniernister be considered. Out of those fruit types the SUV segment was the really attracted segment by the some of the hoi polloi in Sri Lanka where the small Rexton II was a hit carrefour in that SUV segment where it created threat for other norm SUVs in the foodstuff postal service imputable to its less cost (but high quality) compargond with the other SUVs that manufactured by the leading SUV makers in the gentleman the likes of Mitsubishi, Hyundai etc. nevertheless the regimen of Sri Lanka in any case gave great sup carriage to this company as it is a stringently Sri Lankan conjecture and government in a position to sully much vehicles from micro Cars Ltd for government study and it in any case effected in increase the profits of little C ars Ltd. As the demand goes up for the small Rexton II they increased their mathematical crossingion to match with the demand and too with the intention of levying into the Asian markets. For that they scatter their workshop aras and recruited more employees and let the employees work on shift basis like one set of bulk on day and the other set at night.So with the consideration of the previous track read or the milestones of the Micro Cars Ltd, the company it self in a position to consider on expanding their business to capital of capital of capital of capital of capital of capital of Singapore by exporting the Micro Rexton II with the intention of targeting it to the middle-upper class in the Singapore collectible to many potential factors in sexual telling to the conditions of Singapore and also with the hope of competing with other average SUV in Singapore callable to the less price of the Micro Rexton II.Therefore in order to find divulge the vi faculty of export ing Micro Rexton II to Singapore a marketing audit go away be carries push through where it helps to get an idea closely the different market conditions in the competitive market and its potentials where it give open air view about both positive and negative persuasions like whether it bequeath be survive or not. So from there, Micro Cars Ltd pile decide whether to expand to Singapore or not.Furthermore it also essential to conduct grocerying political platform where it support to overcome the negatives that occurred in the marketing audit for the purpose of maximising profits with the inclusive of some areas like promotional mix, budgets, profit/loss statement and etc.2.0 The intersection pointMicro Cars Ltd is the plainly pure Sri Lankan auto spry company in Sri Lanka that goes on continues improvement from the day it starts with increasing of its profits while making the human race more satisfy by offering certifiable solutions to the locomotion bespeaks of majorit y of middle-upper class Sri Lankans. Along with their success in the Sri Lankan market their next plan is to enter into the Singapore automobile market by offering their most hit product in their fib Micro Rexton II.Actually earlier the name Rexton was origin from SsangYong Motors in Korea and later they made strategic shackle with capital investment of Mercedes-Benz AG to support Engine Transmission technologies.When the time goes on Ssang Yong SUV were introduce without delay to Sri Lankan from Korea by Ssang Yong Motors as Ssang Yong Rexton which is the older strain without any collaboration with a Sri Lankan venture. Anyway the older version was not that much popular and it was failed in Sri Lanka due to some uncontrollable factors much(prenominal) as customer mind set that having on the Korean vehicles. just now later Micro Cars Ltd made joint-hands with the Ssang Yong Motors Korea for the introduction of the Rexton II ( bare-assedly version of Rexton) which was assemb led topical anaestheticly in Micro Cars Ltd workshop.In carnal knowledge to the stage of the product life daily round of the Micro Rexton II, it is in growth stage in Sri Lanka. only when considering on the short letter in Singapore the other SUV already in the market are in the maturity stage. So as a result of that this testament be a swell advantage for Micro Cars Ltd to enter into the Singapore market to change the current stage of PLC.2.1 Evaluate the product as an innovation as it is perceived by the intended market basically this is the first time that the Micro Cars Ltd is expanding their businesses out of their boundaries. No matter whether Micro was making huge profits in the local market, but it go off get negatively effected in foreign markets as the conditions are not the same as locally which style the contender getting differ from pastoral to sphere. So it can be risky up-to some extent due to the huge competition that getting to this newly product from major SUV automakers of the world.With deal to the relative advantage of the Micro Rexton II over the other competitors, the SUV users can perceive the same advantages, benefits and features that acquirable in other average SUVs in the Micro Rexton II as well. But all the things are not for high price like other competition brands but at levelheaded price which is lower than the competitive SUVs. as well considering on the fuel consumptions with other brands Micro Rexton II is more fuel efficient SUV with Diesel engine. But most of other SUVs are not in much fuel efficient as those are with Petrol engines. (Other competitive SUVs are available in Diesel engines too, but price is until now higher(prenominal) than the standard petrol SUV prices.) The unique frame volition give more prestigious outlook for the vehicle than other brands do.Also its more matched to the Asians and their beliefs as most of Asians prefer their own country manufactured vehicles or vehicles that manuf actures within their region.In relation to the complexity, theres no requirement to feel special skills to drive Micro Rexton II as it is the same way of driving other SUVs.Further theres another advantage which is the Micro Rexton II can be purchased with minimum risk as it is recognize and certified SUV in Asia.The observability of this product is high. Because you dont need to educate to feel or experience the benefits of the SUV. One you inside in it, thats all you need and you can feel the difference of smooth driving.2.2 Major problems and resistances to product acceptance based on the anterior evaluation.Relative advantage Quality and the condition of the Micro Rexton II is in competitive position compared with other competitive SUVs. But the price of it is lower than the other competitive brands.Compatibility Micro Rexton II is really compatible to the Singapore and with Asian atmosphere as the SUV is from the same region.Complexity Actually its the same way that we be devil to follow to use (drive) the Rexton II and there no any special skills required as it very easy to drive with automatic transmission.Trialability basically this can be purchases with minimum economic risk in relation to the other brand and also the market value or the used value is at acceptable range.Observability actually you dont have to be educating to feel the features of the Rexton II. Because once you got into it, whence you get to feel it automatically.3.0 The Market3.1.1 Geographical regionsSingapore is one of the best well-developed country in the world as well as in the region with well managed stable economy. It covered by Malaysia from one side and Indonesia from the other side where 50% lands are assumed as urban areas while the remaining part have speechless for plantations and other purposes. The battalion who live their also experiencing good standard life with majority of acceptable income.3.1.2 Forms of carry-over and communication available in that region hug drugationTransportation is one of the main component for individually and every country no matter whether it is non-developed, developing or developed country. Because its very significant aspect for all countries to move from place to another or to send some stuff from one location to another and it entrust be expressive style of easy access to different location where which connects boundaries. Considering the conditions of Singapore in relation to the transportation aspects it is the county that own one of the rich transportation systems in the region. As a result of that, the people from all around the world use Singapore as an easy access place and where they also use Singapore as transit place.The types of transportation that available in Singapore as follows.Road transportationActually the on-ground transportation or the road transportation is the most usual cheapest path transportation system that available all around the world even in the poor countries as well.But in relation to the situation in Singapore this common method is using in very advance manner where they own some expressways that length 150 Km and other A-class roads. Basically these 3262 Kms are connecting the Singapore from all around. All the busses, cars including valuateies and other ground vehicles are got to use this method.Rail TransportMainly the rail transportation in Singapore can be classified into two segments much(prenominal) as Mass rapid transit (MRT) and Light rail transit (LRT) which occurly consist of 138.2 Km. The plenitude rapid transit (MRT) is currently running as four line transportation system with total length of 118.6 Km with the collection of 70 stations. Further the remaining light rail transit (LRT) is having 14 stations with length of 19.6 Km.Ports and HarborsThere are totally 8 ports in Singapore and most of the ports which is 7 ports are treatment by the PSA world-wide which earlier names as Port of Singapore Authority. Further Sin gapore is well knows for worlds busiest port Jurong which embraced 1.04 billion tons per year. (Appendix 2)Air TransportationIn relation to aviation industry Singapore is assumed as aviation hub by civil aviation laterality of Singapore where relatively they names the Singapore Changi airport as the air-hub. Further there are 5 air bases in Singapore and also five airlines are currently operational in Singapore leading by the Singapore Airlines where it connects 70 cities around the world. Especially the Changi airport is consisting with 4 terminals with ability of handling 64 million people each year.CommunicationAs stated before Singapore is a well developed country in most areas and they are very rich in engineering wise too. Because most of the technological aspects are born or available in Singapore and all our minds goes to Singapore if we talks about some technological aspect like mobile phone or gaming item. Thats because of the picture that they have buildup in technolog ical perspective over the past years. So due the advancement or richness of the technology they are also armed up with communication aspects too as there are direct linkage between the technology and the communication. Because some times we cannot even have the word communication without the technology. So with regard to the communication methods in Singapore following items can be considered.TelephonesSingapore is one of the best telecommunication providers in the world including SingTel and the Singapore Telecom. Currently they are running with1.857 millions fixed lines. Recently their facilitating their services in excellent manner by adding numerous redundant options to their services.Payphones (Public phone booths)Basically payphones can be classified into to such a card-operated phones and coin-operated phones. Both local and international call can be taken with the use of card-operated phones but only the local calls can be taken by using the coin operated phones. Mostly the se booths are placed in busiest public places like railway stations and bus stops.Mobile phonesThis is the most commodious and common communication method in a country like Singapore due to its technological advancement and richness. Not only in Singapore but also in many countries around the world are use to have it or more comfortable with it because of the fixture use of it. Further the mobile phone usance is very rich in Singapore where the mobile phone services such as 3G, mobile network and etc are handling by SingTel or M1.InternetInternet also same as the mobile phones where it also frequently use by majority of people in developed countries for their different kind of expectations like business needs, entertainment needs , educations needs and etc. Actually Singapore is the most wired location in Asia. As same as mobile service providers, there in general three internet service providers in Singapore leading by the SingNet.BroadcastingIn relation to the broadcasting in Singapore all the media station both Television and Radio are have by the government. All the 7 television channels and 14 Radio channels are operating by the MediaCorp. In appendix to that it also available cable TV and IPTV facility too.Postal operateThis can be considered as one of the oldest communication methods of delivering stuffs. The mandate for these services in Singapore is Singapore post Pvt Ltd where it apportions wide range of postal network, postal agents and stamp vendors.3.1.3 Consumer buying habitsConsumer buying habits is very important factor to be considered in international marketing as the consumer behavior is differing from market to market and also from country to country as well. So identifying different behavior of the different customers will be vital. Because then only the company will be able to deal with them positively in the aim of achieving advantages to the company as the company can come up with different strategies to handle the different p eople in different manner in a way that satisfy both the customer and the company too.So in relation to the product-use patterns in Singapore it look on the type of the product like whether its a FMCG (fast moving consumer good) or whether its luxurious product. Normally they are using FMCGs on daily basis for their regular needs while they use their luxurious goods occasionally. But sometimes our product like Micro Rexton II can be use occasionally and for the daily purposes as well due to its reliability factors.With regard to the product features preferences, the FMCG products are prefer by most of the people in Singapore and they tend to buy those in multiple packs. With regard to the luxurious product, majority of them tend to go for new models periodically.So as we are considering on our proposed product the Micro Rexton II, it will be a luxurious product. So the people in Singapore tend to use this or likes to experience it due to its attractive unique design and other consi derable factors like fuel efficiency and the price affordability.The shopping habits also may differ according to the location. But in Singapore lots of goods are available under one roof. But a product like automobile wont be able to find in common places. Normally those are located in specialized attracted places like showrooms. So we Micro cars Ltd also located the newly Micro Rexton II in our showroom in Singapore which named as Micro Cars worldwide (Pvt)Ltd a fully owned subsidiary of the mother company in Sri Lanka and also fully coordination by Micro Cars Ltd in Sri Lanka.3.1.4 Distribution of the productMicro Cars supranational (Pvt) Ltd is mainly targeting on the end consumers in Singapore that falling under middle-upper class. Basically the business/operations in the Singapore is mostly handle by the mother company Micro Cars Ltd. But due to some factors like less familiarity about ruling, taxing, clearing and other kind of local procedures, we Micro Cars Ltd appoint an agent for Micro Cars multinational (Pvt) Ltd to get things done in Singapore such as some tasks like vehicle clearing from the ports, taxation, adaptation and etc behalf of Micro Cars International (Pvt) Ltd in Singapore. But all the important work that affect on the operations or the core value of the business of Micro Cars International (Pvt) Ltd will directly handle by mother company Micro Cars Ltd and with supportiveness of the appoint agent. Considering on the distribution channel Micro Cars International (Pvt) Ltd is not much engage in distributing it in Singapore as it is not FMCG product but a luxurious product. Because people who needs it will come for an descryion and we are inviting them to come and inspect it in our showroom in Singapore.3.1.5 Advertising and promotionAdvertising and promotion should be there in the action to contact the customer awareness towards the product. The usage of the different advert and promotional tools may depend on the type of the pr oduct. So as the Micro Rexton II is targeting on the end consumers we directly exceed to the end consumers through our advertisements and other promotional campaigns.With regard to the advertising methods that can be use to market Micro Rexton II we can advertise in some electronic medias like TV and internet. Further with the print media it can be publish on automobile magazines and sports magazines.Also in the promotional methods it can propose to give basic first free service for fist 100 customers. In extension to that we are expecting take part in the trade shows and automotive shows by dis turn of eventsing their newly Micro Rexton II.3.1.6 determine strategyCustomary mark-upsThe customary mark-ups will be depend on expectation of the company which means will depend on the amount that they want to earn from each unit.So Micro cars Ltd also having different mark-ups depending on the project where it will differ from project to project depending on its nature and the expectat ions. jibe to this project of exporting Micro Rexton II Micro Cars Ltd will keep 23.5%.3.2 Relative competitors to Micro Rexton II in SingaporeThere will be huge competition for Micro Rexton II in Singapore at the sign stage of their expanding procedure that will come-in from the other average SUV makers in the world such as Mitsubishi, Nissan, Hyundai and Suzuki. The in detail information or the comparison between each mentioned competitors as follows.Competitors products as follows.MakeModelMitsubishiOutlanderNissanX-TRAILHyundaiSantaFeSuzukiGrand VitaraThe features of the all above models can be seen at the appendix 3.Competitors prices are as followsMakeModelPrice (USD)MitsubishiOutlander92000NissanX-TRAIL100000HyundaiSantaFe78000SuzukiGrand Vitara87000When we considering about the advertising and promotional methods, all these companies are in the aim of providing luxurious products to the market. So as a result of that majority of the competitors are using general advertising and promotional methods which some advertising methods such as TV advertisements, internet advertisement, bill boards, magazines while using discounting programs and trade show promotions as promotional methods.Further with regard to their distribution channels most of them are doing their businesses through their agents in Singapore where the agents have the full right to handle most of operations within the country.3.3 Government participation in the grocery storeDevelopment or the growth of a any kind of company can be achieve easily up-to some extent, if the government of that circumstantial country is supporting on the operation by fine-looking lots of benefits from the government side.Further especially in the international businesses, basically there will be minimum of two countries engage in that process to get some thing (goods or services) into the country (importing) or giving it out from the country (exporting). So if the both governments are in positive mode to help on these to gain advantages for both countries, then it will be a really good push for a company to operate there businesses in overseas with less obstacles.In addition to that there should be procedure that should follow by each and every company who enters to the Singapore for their ventures. slightly of those briefly explained regulations are as follows.Any company will come to a conclusion whether to expand their businesses to overseas or not, by looking at the results that they gain through their different studies that they done in relation to specific industry where they hoping to expand.So by following that procedure Micro Cars Ltd has decided to expand their businesses to Singapore by introducing their unique product Micro Rexton II to the Singapore market through Micro Cars International (Pvt) Ltd especially to the people in middle-upper class who tend to use average SUVs. So ab initio they need to register their business (Micro Cars International (Pvt) Ltd) as a company under the required authority in Singapore which named as Accounting and Corporate Regulatory Authority of Singapor (ACRA).Then they need to active their custom accounts under the Singapore customs for relevant monitoring and other processes of the customs authority.Further they will be able to get a special license (if required) for their own tax benefits in Singapore after complete understanding and finalizing negotiations between the two governments. Then there will be tax benefits for product (Micro Rexton II) under this project in Singapore and the government of Sri Lanka can offer some reasonable tax releases for Singapore projects in Sri Lanka.In relation to this matter the government of Singapore comes to understanding with the Sri Lankan government to charge 10% of custom tax in Singapore instead of charging 20% while having 2% GST instead of having 7%.Additionally as mentioned in the earlier stages, the government of Sri Lanka is always behind the Micro Cars Ltd and their proposed subsidiary Micro Cars International (Pvt) Ltd by giving them the maximum support and benefits that can offer by the government side due to the nationality atmosphere of the company as the company is fully concenter venture where the money will never run out of the county. Especially on that way the government of Sri Lanka will never charge any tax on this project which is exporting the Micro Rexton II to Singapore.So due to the tax benefits that the Micro Cars Ltd getting from the both government for their export they will be able to offer Micro Rexton II at really affordable price to the Singapore market which will be big headache for other SUV competitors in Singapore.PART TwoPreliminary Marketing PlanExecutive summaryThe preliminary marketing plan is the main part of this report where it covers major areas of the working out process such as promotional mix, distribution, price determinations and the budgets.Basically it start with the main objectives that has targeted on specific target market of middle-upper class in the aim of creating brand awareness by fulfilling the stylish locomotion needs of the people in Singapore.The usage of promotion mix is in good stands in relation to operations where the company interest in using such media tools like electronic media for TV advertisements, internet advisements and for the electronic bill boards while they tend to use print media like news papers, magazines and billboards. Further it also interest in personnel selling where they specifically targeting on the corporate customers. In addition to that they are focusing in participating for trade shows by displaying their vehicle too.The transportation between two countries will be done by the sea transportation method where it starts from Colombo port to the destination port Jurong in Singapore.There are special document to be shown at the destination port such as Exhaust emission test report, Windscreen test report, Vehicle data card, Vehicle registra tion documents and Manufactures letter to confirm the date of manufacture as this is an automobile transportation and these document are in addition to the general documents such as bill of lading, dock receipt, commercial invoice and statement of origin.Basically all the important operations handle by the special internal management team which appointed by the mother company and additionally the company has appointed an agent for the purpose of handling localize tasks.Regarding the taxes in Singapore perspective the government of Singapore along with Singapore customs charge 10% custom duties based on the value of the product while they charge 2% GST based on CIF value.Regarding the payment methods, the company focus is to go with consignment method which will be an advantage for Micro Cars International (Pvt) Ltd.According to the current position of the company they are well establish and strong in their productions, financial, marketing and etc.4.0 Preliminary Marketing Plan4.1 M arketing ObjectivesMost of the SUVs in Singapore are highly expensive and augmented. But demand has not gone down over the past a couple of(prenominal) years even its expensive, therefore presenting extensively edge SUV will create more demand to Micro Rexton II due to its comparably low price, economies of scale and low labor cost.Current well-disposed situation and demand for products in Singapore is vastly attached with fashion and new trend and therefore the social demand will fulfill with the latest edge design of the Micro Rexton II.One of the other objectives is to creating a higher amount of customer benefit markup compared to other competitors.Expand the brand awareness through out the world using a country like Singapore will be ideal as it known as a travelers paradise and a business hub.Achieve more benefits from a country like Singapore, where it provides more benefits to private business sector of the country meanwhile they getting their own benefits. backside Market Unlikely in Sri Lanka, gender will not play a big component part when buying a vehicle in a country like Singapore due to their westernization heathenish influences and the level of educated people. Therefore promoting even a SUV will not limited to males but will reach every extent possible. After undergoing several researchers studies it is decided to promote Micro Rexton II to middle-upper income earners in the Singapore. Main assumption to target specially to that particular group is that, it is expected that to those income earners perceive this product as a value for money product. Because buying diesel consumption SUV is perceived as a very prestigious behavior.Even though target market consists of the customers who are affordable to the product, Micro Cars Ltd thinks on time to come potential customers as well.Expected sales and profitsBasically this will depend on the ability of capturing the market and how its bugger off the market especially in a country like Singapor e where in a situation that a huge competition among SUV makers going on. Also it depend on how the Micro Rexton II will promote itself to the market and how it can exceed the others competitors promoting patterns in order to get more concerns of the people towards Micro Rexton II. Capturing the customers at the very fist stage is not enough but need to keep it continuously.So based on the findings that we made through our studies we expect that there will be 200 units of sales per year and expecting USD 20 millions profit.Market penetration and coverageAs Micro Cars International (Pvt) Ltd planning to establish their showroom in the capital city of Singapore, it will be much convenient for them to start and continue the marketing process. As most of the merchandising activities are centralized to the capital city, creating the initial demand and maintaining would be benefited from the location advantage. In order to penetrate the market extensive analysis of existent competitors an d their core competencies are highly required. Because capturing the market in a highly competitive environment would be very difficult and competitive. Therefore well planned designs and quality control tools also will play a major role when penetrating the market.4.2 Product adaptation or modificationThis is an exclusive product where that the new version of the Rexton which is named as Micro Rexton II was only available in Sri Lanka but no anywhere else. Because the appearance and the other relative stuff of the Rexton II is completely different from the earlier Rexton which is available all around the world. That is because, its totally assembled in Sri Lanka with locally manufactured items where only the engine and the transmission take from Korea. So we can assume Rexton II as a unique product that available in Sri Lanka.Basically the main advantage to Micro Cars Ltd is the price advantage that they can gain in Singapore markets as the Micro Rexton II can be offered at fewer prices compared to the other average SUV in the specific range.Also most of the parts of the Micro Rexton II such as body of the vehicle, mirrors, seats, and good-for-nothing components including the tires are fully manufactured in Sri Lanka and further they are hoping to add/replace more locally manufactured components to it in order to get more revenue for the country.The features and the specification of the Micro Rexton II can be seen in appendix 4.4.3 Promotion mixIn relation to the exportation of Micro Rexton II to Singapore an extensive promotional campaign will be conduct in order to capture the specific target market in the aim of increasing demand by conveying the benefits of this new Micro Rexton II to the customers.4.3.1 AdvertisingThe objectives of this advertising campaign will be to create awareness of the people and to make them more attractive by conducting creative methods.Media mixThere are many types of advertising methods available in the industry, but all are not relevant to each and every product or service