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MEMBERS

Name Roll. No.

Karan Khona 20

Anand Agarwal 22

Shweta Malekar 24

Dhannya Devassy 26


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Chintan Varia 49

EVOLUTION OF THE COMPANY :-

With over three decades of unchallenged leadership in the industry and 63

untiring years of commitment behind it, Asian paints has come a long way from the

humble four-man enterprise started way back in 1942 to be ranked among the top 15

decorative coatings companies in the world.

Armed with little knowledge and great determination CHAMPAKLAL.

N.CHOKSEY, CHIMANLAL.H.CHOSI, SURYAKANT.C.DHANI AND ARVIND.

R.VAKIL get together to manufacture paint in a garage on FORAS ROAD, BOMBAY.

They name their company the ASIAN OIL AND PAINT COMPANY, a name that they pick randomly from a telephone directory. The family-owned company makes the

transition to professionally managed organization in 1957.

British company BALMER LAWRIE rejects the products of GAINT BRITISH

COMPANY in favor of ASIAN PAINTS. Asian Paint embarks on an ambitious

grassroots marketing campaign, partnering with thousand dealers in small towns of all

over India. Asian paints more than twice the one of the most admired companies in India. And

from fifteen position it has been come in the first best five paint companies in the

world.

Asian Paints, incorporated in 1942, is Indias largest paints company and the market

leader in decorative paints. It has four manufacturing facilities in the country. The

plants have a combined capacity of around 2,30,000 tone per annum (tpa). They are

located at Mumbai (Maharashtra), Ankleshwar (Gujarat), Patancheru (AP), and Kasna


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(UP). The companys Ankleshwar and Patancheru plants are the largest in the country,

with each having a capacity of 80,000 tpa.

CLARIFICATION OF CONCEPT IN BUSINESS

ENVIRONMENT WITH RESPECT TO asian paints

COMPANY.

BUSINESS ENVIORNMENT;-Many forces influence an organizations success. Organizations are open systems that

are affected by and, in turn, affect their external environments.

The external environment includes all factors outside the organizational boundaries to

which managers must pay attention to help their organization compete effectively. The

macro-environment includes the more general factors or elements that can potentially

influence strategic decisions. The competitive environment consists of those groups with

which the organization must interact.

The simplest distinction between macro and competitive environments is the amount of

control a firm can exert on external forces.

BUSINESS ENVIRONMENT

1) External Factors 2) Internal Factors

i suppliers & competitors i mission & objectives

ii social & political ii image & brand equity

iii technological iii human resource

iv international.


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Business Environment Of Asian Paints;-

Asian Paints is well known all over the country. They are known

for quality. The paint stands first in India. They procure materials from both markets

that is locally as well as internationally. They import 20% materials from materials

from south Africa, Germany, Dubai, and many more. They have appointed different

agents in different countries.

Asian paints stand tall , as the number one decorative paint company in the country

today. The decorative business unit is unquestionably the flagship business of the

company with its undisputed market leader status and strong presence across all

product segments and all geographic regions. It possesses strong brand equity with the

widest distribution network; efficient operations and working capital management. The

companies marketing initiative, is definitely worth a mention with an admirable network

of 70 sales units and over 15000 dealers.

The company has grown in the public eye as a major blue-chip investment proposition;

it possess a locally developed technical base that matches the best internationally. Over

the years it has sustained its growth, multiplying its assets and profits rapidly; with

operational efficiency that has earned the company a place among the worlds leading

manufacturers. It is seen as a company that is known for its interventions and that has

successfully managed its industrial relations in todays turbulent world.


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INTERNAL FACTORS

MISSION AND OBJECTIVES

The business domain of the company , priorities direction of

development, business philosophy, business policy etc are guided by the mission and

objectives of the company.

Mission Of Asian Paints;-

WE ENHANCE COMPETITIVE EDGE OF THE COMPANY THROUGH

TOTAL ENGINEERING SOLUTIONS

we would provide products and services that meet stated standards on time,

every time .

We would zero defect as a quality absolute, and shall design and operate our

quality system accordingly

We would organize our work practices to do a job right the first time, every

time.

We would be committed to continuous improvement in quality in all business

processes and shall track such improvement through measurable indicators.

Objectives Of Asian Paints;-

Assuming global leadership in the next logical step for a company like Asian Paints

They dont believe in letting things happen as and when they do .

They have charted out a specific blueprint for achieving their goals.

They plan to achieve, by leveraging their expertise in the higher growth

emerging markets.


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Simultaneously, the company intends to build long term value in the

industry coating business through alliances with established global players.

To provide challenging and meaningful jobs to the employee thus making

them realize their immense potential. And integrate new entrants into

prevalent organizational ethos with a great deal of success.

COMPANY IMAGE & BRAND EQUITY

The image of the company matters while raising finance, forming

joint ventures or other alliances soliciting marketing intermediaries, entering purchase or

sale contracts, launching new products etc. Brand equity is also relevant in several of

these cases.,

Image & Brand Equity Of Asian Paints;-

The company embarked on an ambitious grass-root level marketing

campaign, forming close bonds with thousands of dealers in small towns all over India.

The company jolted its multinational competitors by emerging as Indias No.1 paint

company. Today Asian Paints is more than twice the size of its largest competitor .

But, much more important, it is considered one of Indias four Most Respected

Companies

All four paint manufacturing facilities are accredited with ISO 9001-

the quality certification & the ISO 14001-certification for environmental standards. Asian

Paints brands, Royal in the preimium segment, Apcolite in the middle segment, Gattu,

Tractor , Utsav, 3-Mango, etc in the lower segment, are all well-established brands.

Its one-stop colour shop has software to choose and select 1,511 combinations of

various colours. Its product range includes Wall Paints, Metal Paints, Wood Finishes,

Primers and others.The products that are offered by Asian Paints are extensive and

exceptional. Presently, it enjoys a market share of 10% in protective coatings, and a

20% share in the coil coating sector. The phthalic anhydride division is also one of the

major players in the industry with a market share of 17.6%.


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It has carved out a significant position for itself in the market,

competing actively with the best in the industry.

HUMAN RESORCE

The Characteristics of human resources like Skill, Quality, Market,

Commitment, Attitude etc could contribute to the strength and weakness of an

organization. Some organizations find it difficult to carry at restructuring or

modernization because of resistance by employees whereas they are smoothly

done in some others. The involvement initiative etc of people at different levels

may vary from organization. The organizational culture and overall environment

have bearing on them.

Human resources at Asian Paints:-

Deco HR caters to the recruitment, training, compensation, performance

management and career planning needs of the staff and officer cadre of the sales and

manufacturing units as well as the marketing material and technology functions.

As an human resource professional at Asian Paints you are open to a wide arena of

areas as in a FMCG , but here you get to work in many diverse groups with in one

company. You can be the part of two man HR team handling the entire HR for a

plant with a turnover of INR 450 crores, 300 workmen and 150 staff . HR challenges at Asian Paints creating a high performance workplace, talent

management , ensuring that people partner the organization in achieving its ambitious

growth plans.


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EXTERNAL FACTORS

SUPPLIERS

Suppliers are an important force in the micro-environment of the company. They

supply raw-materials & components to the company. The importance of reliable source of

supply to the smooth functioning of the business is obvious. It is very risky to depend on the

single supplier because of strike, lock-out or any other production problem may affect

seriously to the company. Similarly a change in the attitude of the supplier may affect

business.

Supplier Of Asian Paints:-

BPCL & HPCL are the main supplier of Petroleum products such as Mineral

Turpentine Oil & Xylene.

Other suppliers are

Dupont Product, an Indian vendor- Kerala Metal Mineral Limited (KMML),

20 Microns , Golcha and many more.

Raw Materials Required :

1. Rutile - Pigment for whitening.

2. Solvent - Water or turpentine.

3. Adhesive - Resin/ Emulsion for fixing paint to wall.


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4. Addictives - For fragnance, drying etc.

COMPETITORS

Competitors are important factors that affect business environment. A firms

competitors include other firms which market same or similar kinds of products. They

compete for each & every share in the market. They seek opportunities to take over themarket. They compete in terms of price, quality, quantity etc.

Competitors For Asian Paints:-

Asian Paints has a fixed customer. Their market share is approx 50% of the

organized sector in deco business unit. Asian paints is a well established brand and due

to its brand it the competitors decrease their price or they themselves increase the price

customer will not leave the brand unless & until there is a major quality issue.

Asian Paints Has Various Competitors Such As :-

Goodlass Nerolac

Lewis Berger

ICI duloux

Genson & Nicholson

SOCIAL ENVIRONMENT


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Social environment includes customs, traditions, beliefs, values, tastes and preferences,

buying and consumption habits of various social groups of the society. The social

environment reflects the expectations of different social classes operating in the society.

Each group has some expectations from business firms. Consumers want quality goods at

relational price, investors expect higher rate of dividend and employees expect a better

deal from employers. The social environment changes gradually but continuously. These

changes are due to the spread of education, general awareness, growth of science and

technology. The Changes in social environment could be seen in the form of change in life,

style, social values, increase income, spending habits, social awareness etc.

Social Environment Of Asian Paints:-

Asian Paints approaches the environment issue from the perspective of waste

minimisation and conservation of resources. Thus, the continued attempt is to reuse,

recycle and eliminate waste, which results in less and less waste being generated.

In 2002-03, Asian Paints instituted its own safety standards across all plants in India,

which is based on the standards prescribed by the British Safety Council (BSC). This

year, the four paint plants in India merited a Five-Star rating by the B SC. More

significantly, three of our plants - Bhandup, Ankleshwar and Patancheru - were awarded the

BSC's much sought after "Sword of Honour", which is considered as the pinnacle of

achievement in safety across the world. The Sword of Honour is given to only 40 plants

in the world each year and is designed to reward the best practices in this field. To

have three of the companys paint plants ranked among the top 40 in the first year of

audit emphasiss our steadfast commitment to safety.

Further due to various initiatives undertaken by the company at all its manufacturing

facilities, Asian Paints was the recipient of the prestigious 'Golden Peacock National

Quality award' for 2003. This is the most coveted quality award in the country.

All our paint plants have achieved 'zero industrial discharge' capability. This has been

achieved by the installation of upgraded effluent treatment facilities and installation of


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reverse osmosis plants in conjunction with appropriate recycling & reuse schemes. Our

emulsion manufacturing facility has also achieved 'zero waste' status.

We have adapted the principles of "Green Productivity". Some of our innovative schemes,

which enhance green productivity are

Colour World dealer tinting system allows for greater choice at the customer end

thus reducing the number of shades produced in the factories. This has resulted in larger

batch sizes and lesser number of changeovers leading to effluent reduction.

Upgradation of material handling and storage facilities - such as the new bulk storage

facility for monomers to reduce material losses and eliminate effluent generation

arising out of barrel cleaning.

Up gradation of process technology has resulted in increased yield and therefore lesser

pollution. For instance, the improved filtration process has resulted in higher filtration

rates and lower losses.

Use of natural gas as fuel - instead of furnace oil or diesel has not only improved fuel

efficiency but also reduced sulphur dioxide emissions by 77%.

Solvent recovery plants - set up with an investment of Rs.1.8 million , these plants have

resulted in almost zero solvent disposal and have already yielded a direct benefit of

Rs.10.4 million.

Improved incinerating systems - have resulted in over 72 % reduction in waste after

incineration. The remaining waste is also being re-used. For instance , we have

eliminated the need for disposal of incinerator ash by manufacturing bricks. These bricks

are used for I internal construction purposes.

Reverse osmosis - helps us re-use treated effluents in our cooling towers. This has

reduced fresh water consumption by 50 kilolitres per day.

Rainwater harvesting scheme developed by us has become the benchmark for

industries. Rainwater harvesting has resulted in around 14.5 million liters being

harvested in 2003-04 and used at our plants.

A s a result o f implementing various water recycling , reuse and conservation measures

in our plants, our average water consumption has reduced by 45 % in spite of production


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volumes of water based products doubling in the last five years. Asian Paints is

committed to operate its plants and facilities in a manner to ensure continual

improvement towards achieving 'CLEAN ENVIRONMENT'.

TECHNOLOGICAL ENVIRONMENT

Technology relates more to technique ofproduction or application of

scientific know-how to improve the quality and quantity of the product and production

process. Changes in technology are changing the way business operates.Technological environment consists of a) State of domestic or indigenous technology , b)

Facilities for Research and Development c) Technical Collaborations etc. The Internet is

having a profound impact on the marketing mix strategy of organisations. Consumers

can now shop 24 hours a d ay comfortably from their homes. The challenge these

organisation faces is to ensure that they can deliver on their promise. Those businesses,

which are slow to react, will fall at the first few hurdles. This technological revolution

means a faster exchange of information beneficial for businesses as they can react

quickly to changes within their operating environment.

There is renewed interest by many governments to encourage investment in R & D and

develop technology that will give their country the competitive edge. The pace of

technological change is so fast that in the computer industry the average life of a

computer chip is approximately 6 months. In the name of progression technology will

continue to evolve organsiations that continue to ignore this will face extinction.

Technological Environment Of Asian Paints:-

Paint is a highly raw material intensive commodity, which has a protective

function in addition to the decorative one. An average range of trade sale, industrial,

automotive and maintenance coating employs well 900 raw materials. This possesses a

constant challenge for R & D efforts in formulating and reformulating products for


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better performance, cost reduction, new applications, shade development and exploitation

of new materials. As the environment in which paint is used, keeps on changing with

the expanding problems of industrialization and attendant pollution, the experience of

paint performance also keep on changing, demanding, evolution in paint technology.

Asian Paints has one of Asias largest paint research laboratories, recognized by the

Department of Science & Technology, Government of India. The R & D group is

structured to provide separate focus to Industrial Paint Technology and Decorative Paint

Technology. Our Firsts in the paint industry specialized chemical resistant coatings,

computerized color matching, thermosetting, acrylic finishes and economic plastic

emulsion paint.

Naturally the company has always placed very high emphasis on its in-house R& D

requirements. This dependence on in house R& D efforts has paid rich dividend, as the

company and penetration of new market segments with new products. By bringining in

automation for example:-PLC (Program Logistics Control ) and faster production

machines which reduced the cylcle time and man power.

The Role and Mission of the Technical Function is to:-

Maintain and improve competitive edge in the product quality through robust

design concepts, specifications and standardization.

Respond to identified customer needs through development/ upgradation of

products/ processes offering specified quality in acceptable cost parameters.

Continue towards development of new/ alternative vendors and raw materials and

build flexibility into formulation with respect to materials.

Scan the environment to forecast future technology needs and to conceive long

term R&D plans and needs for import of technology.

In the Technical function, involved in

Developing new products / processes and modifying existing ones as per the

market requirements.

Troubleshooting and lending help to manufacturing in introducing and stabilizing

new products / processes.


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POLITICAL ENVIRONMENT

Political factors can have a direct impact on the way business operates.PoliticalEnvironment is a comprehensive terms and includes political system, the ruling party, the

philosophy of various political party, political development , the style of leadership,

political, instability and many more factors. Legislature, executive and judiciary are the

important pillars of political environment. Decisions made by government affect our

every day lives and can come in the form of policy or legislation. The governments

introduction of a statutory minimum wage affects all businesses, as do consumer and

health and safety laws and so on.The executive i.e. the government implements orenforces the laws pass by legislature, and judiciary plays the role of watchdog to see

that both the legislature and the executive wings function within the constitutional

limits.

Political Environment of Asian Paints :-

Handling Excise disputes, proceedings cases and audit :-

The Excise Department is responsible to protect the company from excise

and service tax dispute / demand by providing appropriate that may received from time

to time. The department ensures that proper replies, appeals or written petitions are filed

within the stipulated time before the appropriate authority to secure the company


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rights.Corporate Excise functions provides support to appropriately reply to audit issues

raised during the excise audit. The Department all this, Plants and CMD and all

Branches/ Units will have to refer their excise/ service tax issues to Corporate Excise.

Legal Functions

The legal proceeding certificates are obtained for producing them as the evidence in

the suit for infringement of trade marks in the court of law as the certificates

issued by the Trade Marks in not accepted as an evidence in court of Law.

Cases such as

Stamp Duty, Octroi, defamation, theft, weights and measures, trade marks and copyrights

etc.are handled by the department.

Consumer Complaints

Replying the notice of the consumer for alleged defect in the material.

Challenging the complaint filed by the consumer in the Consumer Court.

Property Matter

Vetting the Agreements & Scrutinizing papers relating to premises i.e. all

agreements involving lease, leave and license, purchase or sell of property of

company have to be sent to legal department and approval is sort.

The Legal Department prepares new Agreements for Lease, Leave & License,

Purchase, Sale, etc. for branches & other department.


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INTERNATIONAL ENVIRONMENT

The international environment is very important from the point of view of certain

categories of business. It is particularly important for industries directly depending on

imports or exports and import-competing industries. For example, a recession in foreign

markets, or the adoption of protectionist policies by foreign nations, may createdifficulties for industries depending on exports. On the other hand, a boom in the

export market or a relaxation of the protectionist policies may help the export oriented

industries. A liberalisation of imports may help some industries which use imported

items, but may adversely affect import-competing industries.

Asian Paints-international operations:-

In 1977,Asian Paints made a tentative foray outside India by setting up a manufacturing

plant in Fiji. In the over three decades that have elapsed since, the company's

international business have grown beyond its own expectations.

Asian Paints today is a true Indian multinational, with a strong presence in Fiji, Tonga,

Soloman Islands, Vanuatu, Australia, Sri Lanka and Nepal. Two new plants were set up in

Oman and Mauritius, to cater to the West Asian and the Indian Ocean rim regions.

Acquisitions will be the company's route to achieving leadership in the international

market. The first such move was the takeover of Delmege Forsyth & Co., the second

largest company in Sri Lanka. In fact, Asian Paints has the distinction of become the

No.1 paint company in any country it has entered, within just five years of doing so.


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The company made a strong move towards its vision by acquiring controlling stake in

BERGER INTERNATIONAL LIMITED (BIL), a holding company incorporated in

Singapore. Berger International Limited (BIL) has operations in 11 countries that include

China, Singapore, Thailand, Malaysia, Myanmar, Bahrain, Malta, United Arab

Emirates(UAE), Jamaica, Barbados and Trinidad and Tobago. Besides, it holds 30%

stake in Dutch Boy Philippines Incorporated, a Philippines based company. The turnover of

the group in 2001 was $115 million(INR 3220 million).

This is Asian Paints largest acquisition in overseas markets and will expand the

company's operations to 23 countries across the globe. After the acquisition, Asian

Paints ranks amongst the top 10 decorative coatings companies in the world.

Its international paints units apart, Asian Paints is also the largest exporter of paints

from India, exporting to over 26 countries.

MARKET LEADERSHIP IN 10 COUNTRIES:

-Fiji, Tonga, Sis land, Vanuatu, Nepal, Malta, Jamaica, Trinidad and Tobago, Barbadus and

Bahrain.

2nd LARGEST PLAYER IN 4 COUNTRIES:

-Philippines, Myanmar, Sri Lanka and Bangladesh.

3rd LARGEST PLAYER IN 5 COUNTRIES:

-UAE, Singapore, Mauritius, Oman and Egypt.

PRESENCE IN THE 4 LARGE MARKETS:


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-Thailand, Malaysia, Australia and China.

CONCLUSION

Asian paints is largest exporter inn India dealing with paints its

exports all over 26 countries. Due to changes in policies it greatly effects the business.

Also they have to operate in international market, so they have to curb themselves

accordingly to their policies & customs.

If in the market there was no competition Asian Paints would have

monopolized the paint market. Due to competition day by day it is coming upon with

new innovation & schemes for the same and is working constantly on its brand name

and goodwill . This resulted in listing Asian Paints in 25th position among the whole

industries in India and 1st among paint industry [ Economic Times survey] .

To keep abreast with technology it has been computerizing its various

operation for more than 25yrs. Its implementation of advanced planning and optimization

software has reaped the informational flow for planning decision making & control , thus

resulting in stoppage of inventory piling and eliminating lapses between two production

function.

For Asian Paints customer satisfaction is of their prime objective. All products manufactured are made keeping in mind full customer satisfaction. Thus they

manufactures their products keeping in mind the customers. Thus

is an enterprise

which keep constant watch on different types of environment and adjust

their business plans, policies and operations as per the environmental

changes taking place.


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asianpaintshas an integrated approach towards business.

-

ACKNOWLEDGEMENT

Foremost we like to express our heartfelt thanks to our

Prof. Mrs. GEETA SASHIDARAN for giving us this project on

business environment. While completing the project we practically

got a very clear idea of the concepts in business environment.

A vote of appreciation also goes to Mr. George Varghees for his

guidance & corporation in the project.

We also thank our group members for their Mutual Corporation &

kind support


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