Letter of Transmittal:

April 16th 2014

Mr. Md. Ashraf Harun

Lecturer
Department of Business Administration
East West University

Sir,

With due respect, we are here to submit the following report on Walton Bangladesh
according to the instructions given by you.

After going to several Walton showrooms in Dhaka and doing a thorough website
research on Walton Bangladesh, we have been quite successful in collecting necessary
background information about Walton Bangladesh. A survey among the existing and
prospective Walton users also helped us to understand the market trend and the consumer
behavior. The following report is the result of our findings and efforts.

We appreciate this opportunity to work under you.

Sincerely,

Group - Navigator

Mehreen Chowdhury ( 2010-1-10-077)

Section - 4
East West University
Executive Summary:

This report was commissioned to analyze and evaluate performance and future prospects
of Walton in a growing domestic electronic market.

The research reveals that in a continuously growing market, Walton has become a
reliable name for customers. Countrywide network, inclination towards quality and
dedicated team of employees are the main causes of its success. Though it had started
business with home appliances, yet it has always been committed to satisfying customer
demand by introducing new products. Recent production and selling of motorcycle and
air-conditioner testifies that position of Walton.

Walton has a goal to double overall market share in the next 5 years. It has successfully
positioned itself as a customer friendly and eco-friendly Company. Its after sales service
has contributed tremendously in building this image in customers’ minds.

Since its target market is middle-income people, the price of their products is
comparatively lower than those of competitors’. This strategy helps the company greatly
in a price sensitive consumers market. In recent years Walton has increased promotional
activities through organizing various national sports events.

Further investigations have revealed that to achieve the role of market leader, it will face
challenge from foreign brands. Moreover, rapidly growing demand from customers for
electronic products may put pressure on Walton. It has adopted market penetration,
product development and market development strategy for future growth.

The report has found the prospects of Walton promising in its current position. Favorable
government policy will help it expand domestic and international markets in the future.
Table of Contents:

1. Introduction
1.1. Origin of Report 05
1.2. Objective 05
1.3. Methodology 05
1.4. Limitations 06

2. Company and Market Background

2.1. Electronics market in Bangladesh 06
2.2. Walton HIL 07
2.3. Competitor Analysis 08
2.4. Market Share 09

3. Strategic Situational Analysis

3.1. Market Analysis 11
3.2. Market Segmentation 11
3.2.1. Demographic 11
3.2.2. Geographic 12
3.2.3. Psychographic 13
3.3. PEST Analysis 13
3.4. SWOT analysis 14

4. Marketing Strategy
4.1. Market positioning 14
4.2. Marketing Mix 15
4.2.1. Product 15
4.2.2. Price 16
4.2.3. Place 16
4.2.4. Promotion 17

5. Financial Analysis 17

6. Future Growth and Challenges

6.1. Current Market Status 17
6.2. Challenges 18
6.3. Future Growth 18

7. Recommendation 19

8. Conclusion 19

9. Appendix 20

10. References 22
1.0 Introduction

Today with technological advancement human race has achieved what few years back
where impossible. Electronic is the source of easier to comport human life. When
Electronic was first introduced in Bangladesh, it was an expensive and fashionable item.
Its price has also gone down considerably and more people in the society can afford it. At
present there are several marketers who are offering their electronics product in the
market. Among them Samsung, Butterfly, Singer, Konka, are most widely known brand.
And Walton is one of the leading electrical and electronics manufacturing company in
our national market. Walton Electronics is basically a Bangladeshi brand with a national
image. In Bangladesh it is targeting the niche market for their home appliance products
commencing their marketing strategy as of their high quality and reasonable products.
They do not do their marketing for a particular group of people; they do their marketing
those who has the ability to buy their products. Since the standard of living of people in
our country is going up, everybody is aware about a brand of a product and wants to buy
a qualitative product for a longer period of time. Walton industry is trying to buildup a
better basement with better technology.

Since the real life business situation is always very complex and competitive, every
business has to face the intense competition and those who can successfully operate
within this critical situation can become the blue cheap. To stay and increase the pace in
the business track, the perception and brand awareness is very important.

Origin of the Report

This report has been made as the course requirement for Principles of marketing. The
topic for this report has been chosen by our honorable faculty Mr. Md. Ashraf Harun Sir,
Faculty of Business Administration Department at East West University. This report
contains the consumers’ reactions toward Walton electronics they use, and their
satisfaction level about the product.

Objectives of the study:

 Learning a didactic approach to Principle of Marketing

 Incorporating theoretical education with practical experience.

 Gaining knowledge about the current market trend of the country.

 Getting acquainted with different policies, rules and regulations of the

government on the products concerned.

Methodology:

The methodologies used in the research process for this report, were:

Data Collection:

Primary data is the information that we collect first-hand and secondary data is the
information collected by others and used by us. For data collection, we used three
approaches:
a. First, we conducted some field research. We went to some Walton retail outlets
and asked the customers about their valuable suggestion and opinions.
b. We searched about Walton on the Internet and found some important information
regarding their company background, product lines and promotional programs.
c. We went to Walton head office and collected the annual reports for Walton
Bangladesh for the year 2012.

Limitations:

Though we tried our best to make a hundred percent perfect report, a few
limitations held us back. The main limitations that we faced, were –
a. As many of the common products were barred, we had to choose one from a
limited number of options.
b. When we went to collect information from the Walton outlets, they were not
fully able to cooperate with us, as our required information was confidential.
c. There was not enough data in the websites.
Company Overview of WALTON
R.B Refers to Rezvi and Brothers
S. M Nurul Alam Rezvi : Managing Director
S. M Shamsul Alam : Director
S. M Ashraful Alam : Director
S. M Mahbubul Alam : Director
S. M Rezaul Alam : Director

Brand of R.B Group: Walton, Marcel

Products of Walton and Marcel:

 Refrigerator & Freezer
 Motorcycle
 Air conditioner
 Television (CRT, LCD)
 DVD Player
 Microwave & Steam Oven
 Domestic and Industrial Generator
 Manganese & Alkaline Battery
 Upcoming Project: Mobile Phone, Computer LCD Monitor, LED TV,
Laptop, Car etc.

Walton Hi-Tech Industries Ltd. - A sister concern of R.B Group is the pioneer of
Television, Refrigerator, Freezer, Air Conditioner and Motorcycle Manufacturing
Technology in Bangladesh. R. B. Group is the country's top business Group in electrical
and electronics, Automobiles, and Home appliances using the brand name WALTON.
The company has been running its business with a great reputation since 1977
Establishment of Walton HIL to Manufacture Refrigerator & Freezer, Air Conditioner
and Motorcycle etc. in Bangladesh is a milestone in the path of success and reputation of
the brand WALTON. Walton HIL has introduced first advanced research and
manufacturing technologies and equipments for household & commercial Refrigerator &
Freezer, Motorcycle and Air Conditioner etc. in Bangladesh. Walton HIL is furnished
with strong Research & Development (R&D) Division comprising of a large team of
dedicated highly skilled engineers & technical personnel from home and abroad.

Walton Hi-Tech Industries Ltd. has its own Mold & Die making section, high precision
molds & dies are made by the help of the state-of-the-art VMC, CNC Wire-Cut, EDM
etc. machines. The company has three Poly Urethane Foaming Plants, three
Thermoforming (Vacuum forming) Units; highly equipped Metal Forming Units with
Powder Coating, Nickel-Chrome Plant & Die-Casting Section, and Robot operated
Injection Plastic Molding Plant, Highly equipped Test Lab, Printing & Packaging Section
etc. Walton HIL always emphasizes on supreme priority in achieving customer
satisfaction. The company always ensures product quality and renders the innovative
latest technologies in its products. It has a complete experienced professional engineering
team combined with both home and abroad to serve the valued customers

Company Profile:

Company Name: Walton hi-tech industries ltd.

Business Type: Manufacturer, Trading Company
Product/Service(We Sell): Television, Refrigerator, Freezer, Motorcycle
Product/Service(We Buy):Television, Refrigerator, Freezer, Motorcycle
Address: 10,Dilkusha C / A Dhaka-1000
Brands: Walton
Number of Employees: Above 1000 People
Ownership & Capital
Year Established: 2006  
Registered Capital: US$10 Million - US$50 Million
Ownership Type: Corporation/Limited Liability Company
Legal
Representative/Business Walton Hi-Tech Industries Limited  
Owner:
Trade & Market
Eastern Europe
Africa
Oceania
Main Markets:
Mid East
Eastern Asia
Western Europe
Total Annual Sales
US$5 Million - US$10 Million  
Volume:
Export Percentage: 91% - 100%  
Total Annual Purchase
US$5 Million - US$10 Million  
Volume:
Factory Information
Factory Size: 50,000-100,000 square meters  
QA/QC: No  
No. of Production Lines: Above 10  
No. of R&D Staff: 41 – 50 People  
No. of QC Staff: 51 – 60 People  
Contract Manufacturing: OEM Service Offered   Buyer Label Offered  
Principles of Walton

Walton strengthens its CUSTOMERS-to keep them

competitive

Walton’ success depends on the success of its customers. It

provides its customers with its comprehensive experience and
solutions so it can achieve its objectives fast and effectively.

Walton pushes INNOVATION - to shape the future

Innovation is its lifeblood, around the globe and around the

clock. It turns its people's imagination and best practices into
successful technologies and products. Creativity and
experience keep it at the cutting edge.

Walton enhances company VALUE - to open up new

opportunities

It generates profitable growth to ensure sustainable success. It

leverages our balanced business portfolio, its business
excellence and synergies across all segments and regions. This
makes it a premium investment for its shareholders.

Walton empower its PEOPLE - to achieve world-class

performance

Its employees are the key to its success. It works together as a

global network of knowledge and learning. Its corporate
culture is defined by diversity, by open dialogue and mutual
respect, and by clear goals and decisive leadership.

Walton embraces corporate RESPONSIBILITY - to

advance society

Its ideas, technologies and activities help create a better world.

It is committed to universal values, good corporate citizenship
and a healthy environment. Integrity guides its conduct toward
its employees, business partners and shareholders.
Overview of Walton Bangladesh at a glance
Walton is one of the leading electrical and electronics manufacturing company in our
national market. Walton electronics is basically a Bangladeshi brand with a national
image. In Bangladesh it is targeting the niche market for their home appliance products
commencing their marketing strategy as of their high quality and reasonable price. They
do not do their marketing for a particular group of people; they do their marketing those
who has the ability to buy their product. Since the standard of living of people in our
country is going up, everybody is aware about a brand of a product and wants to buy a
qualitative product for a longer period of time. Thus, consumer perception and brand
awareness for refrigerator is now become a vital aspect when purchasing a electronics.

Corporate Policy:
Operation Policy:
Corporate sales operation through area wise-
Gulshan
Mirpur
Uttra
Dhanmondi
Motijheel
Mogbazar
Azimpur etc. of Dhaka city

Operational Hierarchy of corporate Showroom:

 Director of
corporate sales

Senior manager of
corporate sales

Accounts & Stock Show room Corporate

In charge Manager Executive
In-house Executive
Service Receive
Executive
Delivery &
Maintenance

Corporate Show room operation policy:

Existing Policy
SOP
-Selling Instrument (Cash, Credit Card, Installment buy, Corporate Agreement, Discount
etc.)
-Operation Schedule (Operation Time, Leave, Payments, Commission etc.)
-Uniform code, Name Tag, Price code.
Jobs of Corporate Team:
Target organization by segment
Meeting Fix up
Introduction Letter
Invitation Letter
Agreement Letter (Enlistment, HR, Personal level)
 Offer Letter

Focus or Vision of Corporate Sales Team:

Cover all the area of Dhaka city
Establish all corporate sales point very strongly
Start to job in a new sales point after covering old sales point
The sales point will be covered with a strategic plan.

Industry Key Success Factors

Quality of the product should be high with attractive features.
Price should be affordable and competitive
Distribution channels should be recognized
Promotional activities should focus on brand equity and image and it
should have association with lifestyles of local people.
Highly skilled sales force with managerial experience is required to do
quality control.
After sale service and warranty should be provided.

Target Market of Walton Refrigerator in Bangladesh

 Upper class
 Upper middle class
 Middle Class
 Lower middle class
 Lower classes people

Competitors : competitors can be defined as two way-

 Direct competitors
 Indirect competitors
In Bangladesh Walton basically do not have any competitors who can compete directly
with them according to their Brand and price. They are the only one Manufacturer in
Bangladesh market and so that they have lots of advantage. But they have many indirect
competitors who are exporting from International Market, competing with them
indirectly by having not the similar quality product in the market but they are offering
attractive price with new features. The names of the competitors are- Samsung, Singer,
Toshiba, sharp, konka, Butterfly etc. some of them are assembled in china at a cheaper
cost.

2.2 Mission, Vision & Objective of Walton Bangladesh Limited

Mission:
“To grow and increase value by implementing advanced technologies, new products
and services to provide excellent solutions to satisfy customers’ requirements.”

Vision:
“To provide the best solution and equipment to customer.”

Goal:
“To achieve market leadership, profitability, good corporate citizenship and a
sustainable growth.”

Objectives:
“The main objective of the company is to increase the market share in related
diversified products and solutions in Bangladesh and to assure the potential
customers of the quality and durability of the products. Although the products are a
bit highly priced but it is the best bargain that money can buy.”

Company and Market Background:

 2.1. Electronics Market in Bangladesh

The Electronics Market in Bangladesh is an ever-rising industry. The appropriate market

size has never been determined as it is ever changing. The whole market can be separated
into several segments like:

 Semiconductor Market
 Electronics Appliances Market
 Raw Materials and Spare Parts Market
 IT Market

Walton is one of the major players in the electronic appliances market. They are also
manufacturing motorcycles alongside home appliances such as television, refrigerators,
air-condition etc.

The market of these products relies heavily on the average household income. For most
people in Bangladesh home appliances had been luxuries they, which they cannot afford,
but recently the situation have been changing. Over the last 10 years, there has been
massive economic growth in the country, which has increased the income of lower-
middle and middle class people. So the demand for home appliances has increased
substantially.

If we look at the annual GDP growth of the country in the last 10 years, we can see that
there has been a steady increase.

Competitor Analysis:

In the field of home appliances such as television, refrigerator, freezer, air-condition etc.
some of Walton’s competitors are:

Competitor

Television
Refrigerator Air-Condition
 LG LG
LG

Sony Samsung
General

Gree
Singer
Sharp
Samsung
Samsung
Panasonic

MyOne
Panasonic Whirlpool

Most of these brands have been in this market for a long time. But none of them were
able to match the market growth of Walton in the last 3 years. Although LG-Butterfly is
the No.1 home appliances brand in the country, Walton is catching up fast.

Walton has started manufacturing major parts for the assembly of motorcycles. Right
now they hold nearly 8% of the market share. Its competitors are:

 Bajaj
 Hero Honda
 Dayun
 TVS
 Singer
 Butterfly

Market Analysis:

Bangladesh, with its growing population and economic growth, has huge demand for
household products. The fact that only about 60% of the country has electricity available
proves that when electricity will be available throughout the country, demand will
increase further.
As the people of this country are mainly price sensitive, Walton, being the sole
manufacturer of refrigerator, freezer and motorcycle, is very keen to meet the demand of
this large market by providing competitive prices.

Walton’s primary goal is to capture the local market, as they are still behind market
leader LG-Butterfly. But they are also exporting their products. Already they have
customers in Myanmar, Bhutan and planning to expand their market to Africa.

Market Segmentation:

Segmentation is one of the most important factors of strategic marketing. Market

segmentation is one of the steps that go into defining and targeting specific markets. It is
the process of dividing a market into a distinct group of buyers that require different
products or marketing mixes. Markets can be segmented or targeted using a variety of
factor. The bases for segmenting consumer markets include:

    • Demographical bases (age, family size, life cycle, occupation)

    • Geographical bases (states, regions, countries)

    • Behavior bases (product knowledge, usage, attitudes, responses)

    • Psychographic bases (lifestyle, values, personality)

The market in which Walton is doing its business is consumer market and Walton mainly
segments its market base on Demographic, Geographic and Psychographic basis.

Demographic Segmentation:

In segmenting the market on demographic basis Walton mainly considers occupation and
family size of the consumer. It targets the people of middle-income level and designs its
products for mainly nuclear family.

Geographic Segmentation:

Walton segments the whole country in eleven zones for marketing purpose. They are

 Dhaka North Zone

 Dhaka South Zone
 Dhaka South-West Zone
 Chittagong Zone
 Comilla Zone
 Barisal Zone
 Jessore Zone
  Sylhet Zone
 Bogra Zone
 Mymensingh Zone
 Rajshahi Zone

Area Managers are responsible for these zones and it is their responsibility to develop
market there. Product demand and response of the customer are not same in all zones.
Maintaining the sales in high demand zones like Dhaka, Comilla, Bogra the marketing
department is trying to increase their sales in low demand zones.

Currently, Walton has either their retail shops or dealer shop in all of the 65 districts of
Bangladesh. They have multiple shops in Dhaka and Chittagong in order to provide
maximum convenience.

Walton Plazas in Dhaka:

Walton Plazas in Chittagong:

Psychographic Segmentation:

Walton markets its product by using psychographic segmentation. They use lifestyle to
segment their market. For example Walton is marketing relatively cheaper CRT
Television for lower-middle income and rural people and at the same time LCD
Television for higher middle-income people. It also designs the refrigerators of different
size and capacity considering the people of different lifestyle.

PEST Analysis:

 Political Factor:

o High Import Duty on Imported Home Appliance Product

o Export promotion schemes of Bangladesh Government
o Tax Incentives on Import of Plants
o Constant Government Support

 Economic Factor:

o Increase in per capita income

o Growing GDP high disposable income
 o Increase in Spending Power
o A huge prospect of a profitable export sector

 Socio-cultural Factor:

o Manufacturing Eco-Friendly product

o Changing lifestyle of middle income people

 Technological Factor:

o Improvement in Technology made electronics cheaper

o Increased quality of production

SWOT Analysis:
Market Positioning Strategy:

Walton has created huge enthusiasm among the consumers of its target market with its
slogan “Aamader Ponnyo”. They accepted Walton’s endeavor of manufacturing some
electronic items like, refrigerator & Freezer and motorcycle for the first time in
Bangladesh, and are more than willing to buy a product of high quality made in our own
country. On the other hand, as a local manufacturer Walton can sell quality products at
comparatively lower price than other competitors.

It also makes its product available at the nearest possible places in each areas of
Bangladesh through Walton Plazas (own showroom) and countrywide dealers. New
Walton Plazas are being opened frequently in different places of the country for getting
closer to the customers.

Another strategy of Walton for creating a concrete place in the customer mind is it’s after
sales service. In order to providing the quickest possible after sales service to the
customers Walton has already established 39 Service Centers and opening more service
centers is under process. Walton equally values its sales and after sales service for
maintaining a long and positive relation with its customer and thus retain and increase the
customer.

Marketing Mix:

4.2.1. Product:

Walton has a good number of products available in the market. The company produces
home appliances, mobile, generator and motorbike. A brief description of its major
products is given below:

 Refrigerator:

Walton mainly produces home appliances. In fact in its website the company is
introduced as the pioneer in refrigerator production in Bangladesh.
Walton Refrigerator & Freezer ensures highest quality compressor, Condenser is
made by 100% copper, which lasts for 20-30 years. The most important thing is that
every spare parts including door with different color are changeable and available
everywhere over the country.

 Television:

Walton produces LED, LCD, and CRT televisions. Walton Television ensures home
cinema entertainment. Walton Television’s d4ta Digital Technology is one of the most
innovative technological solutions that automatically reduces video noise, Selects the best
picture and performs fine-tuning by auto frequency tracking technology.

 Motorcycle:

Walton motorcycles are now competing with the Indian Hero-Honda and TVS brand. The
motorcycles have become famous because of the special specification like mobile phone
indicator, Digital gear display, Fuel location meter, Air shock absorber, Remote control,
Hydraulic Brake, Anti-Theft lock and Alloy rim etc. Walton motorcycles are also fuel-
efficient.

Other than these products Walton also produces Mobile handsets, generators, air
conditioners, DVD players, and microwave ovens.
Table 01: Product Mix of Walton HIL (Walton Hi-Tech Industries Ltd (Walton HIL)

Price:

Walton’s main target market has always been middle-income group. SO they have been
very careful in setting their price of product. Also the fact that they manufacture their
products, it allows them to set a lower price than their competitors, as they don’t have to
pay heavy import duty. Below is a comparison of the prices of different products of
different brands-

Table 02: Price comparison of Refrigerators.

Model Walton LG Transtec Sharp
10 CFT 26,200 35,000 32,000 29,500
10.5 CFT 28,100 38,300 32,500 31,000
11.5 CFT 29,700 40,600 36,000 37,000

Table 03: Price comparison of TV.

Model Walton LG Sony My One
29” Color TV 18,500 28,350 26,350 22,700
37” LCD TV 48,800 65,600 59,500 -
42” LCD TV 75,200 95,000 88,000 -

Table 04: Price comparison of Motorcycle.

Model Walton Bajaj Hero Honda TVS
125 CC 103,900 175,000 155,000 160,000
110CC 96,000 148,500 145,000 140,500
Cruiser 93,300 120,000 110,500 98,000
In all three products in which we have done market research, it is evident that Walton is
providing the consumers with the least expensive product. It is vital for Walton as price is
the only tool where they have a superior advantage over other brands. But it must be
noted that consumers in higher income level also look for quality products. So Walton
needs to find a fine balance between price and quality as they move forward in the
coming years.

Place:

For making the product available to its target customers Walton use its distribution
channel. Walton generally uses its own transport facilities for reaching the product to its
120 Walton Plazas and about 700 dealers. If any dealer wants to use his own transport for
transporting Walton products from factory to his shop, he gets 1% reduction on dealer
price.

Promotion: Ever since Walton started its production in its manufacturing plant, they
have started a wide promotional campaign on its product. Their tagline “Amader
Ponnyo” reflects the pride they take by being able to sell home appliances manufactured
in Bangladesh. Right now Walton has TVCs running in all major satellite channels of
Bangladesh in peak hours targeting their core target customers. Also they have numerous
billboards and advertisements in print media. Also their 120 Walton Plazas across the
country also works as a major advertising tool. Walton has recently started sponsoring
different major sports event in the country. Recently they sponsored their first
International Cricket Tournament and thus it allowed their brand to be viewed by
millions of people across the world.

Financial Analysis:

Summary of the Financial Report of Walton for the year 2012:

Table 05: Financial analysis of Walton HIL

Particulars Amount Tk.
Total Sales 2,553,024,782.10
Cost of Goods Manufactured 2,414,093,716.05
Gross Profit 305,852,566.61
Operating Profit 99,636,450.25
Net Profit 26,530,733.53

. Challenges:
  Establish Walton as the No.1 Home Appliance Brand of the Country
 Capturing the market share of existing foreign brands
 Bringing more variety in their product line
 Continue increasing market share at the same rate over the next 5
years.

Future Growth:

Walton has decided to penetrate market, develop both market and product to achieve
profitable growth in future.

Market penetration: Through extensive promotion campaign Walton has set goals to
make more sales in future. Countrywide distribution system helps it achieve its goals.

Market Development: Walton is exporting its products in Middle East, Latin America and
Africa. It has plans to explore European markets also.

Product Development: Recently, Walton brought Air-Condition in market. Though it

hasn’t gained spectacular market share yet, continuous customer attraction reflects future.
Expected market growth of Walton in the next five years:

Table 06: Future growth of Walton HIL

Product Line Present Market Expected Market Main Competitor
Share Share (2016)
Motorcycle 5% 25% Bajaj, Hero Honda
TV 8% 30% LG, Sony
Refrigerator 13% 25% LG, Samsung
Air-Condition 2% 10% LG, General, Gree

Recommendations:

To establish Walton as the brand for home appliances & other electronic accessories,
some changes are needed in its strategies-

 Switch to Market Penetration Pricing without compromising quality.

  Partner with local and international OEM (original equipment manufacturers) for
elegant & sophisticated designs & equipment.

 Develop gaming consoles like Gameboy, PlayStations, X-box and medical

appliances for caring old people through innovative approaches.

 Customer Loyalty Program

 Yearlong incentives and special offers

Conclusion:

The company has been running its business with good reputation since 1977.
Establishment of Walton HIL to manufacture Refrigerator & Freezer, Air
Conditioner, and Motorcycle etc. in Bangladesh is a milestone in the path of success
and reputation of the brand WALTON. Walton HIL is the first company to introduce
advanced research and manufacturing technologies and equipment for household &
commercial Refrigerator & Freezer, Motorcycle and Air Conditioner etc. in
Bangladesh.

For Bangladesh, Walton has become a company to be proud of in the export arena.
Walton has truly redefined Bangladesh from being a consumer country to a producer
country for home appliances.
References
http://en.wikipedia.org/wiki/Walton_%28company%29