Nila Soap Industry Analysis

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Objectives The purpose of doing this project is to give an overview of Nila Soap Industry. We are analyzing the Demand and Supply, Elasticity, Production Process and Costs, Horizontal and Vertical boundaries, and brief analysis of market structure. Company Background Nila is the soap manufacturing company in India, which belongs to the parent company named Krishna Enterprises. We manufacture and sell ayurvedic soap products for the last one year. We produce product that contain the cleanest organic ingredients deck. We make a far cheaper product with good quality and at a higher margin. Our main motive is to provide pure and natural soap accessible to all. Competitors Soap industry is highly competitive.…show more content…
In the product the price is an independent variable and the quantity demanded is the dependent variable because the amount of product the consumers are willing to purchase depends on the price. Law of Demand The consumer buys 5 bars of soap per month, were it is priced at a rate of $4 each. If the price raises to $4.5 the consumers is likely to purchase fewer number of soap. Conversely if the price falls from $5 to $4 the consumer will probably buy more number of soap per month. At these lower price, the soap product will becomes a better deals in terms of customer satisfaction and we get for each dollar he spent. This inverse relationship between price and quantity demanded when all other factors are kept constant is known as the Law of Demand. The below table shows the quantity demand and the quantity supply of Nila soap’s at different prices. Condition 1: The lower price higher the demand and vice…show more content…
There are plenty of suppliers in the market to supply the raw materials to soap producing companies and they compete among each other. As a result of which Nila enjoys the facility to get suppliers providing good quality raw materials at a cheaper rate. So the lucid analysis of the situations says that bargaining power of supplier is very low. 4. Bargaining power of the Buyers The bargaining power of the buyers of our product is high. Consumer always want to buy quality product at a cheaper rate. Since the price level of Nila is bit high some consumers do not feel interest in buying Nila as other brands also offer good quality organic products in soap category at a cheaper rate. So buyers have high bargaining powers with somehow causes Nila to lose some market share. 5. Industrial Rivalry The brand Nila has got huge market share in Germany and India. If we focused on the other brands in soap category in Germany, we can see that there are lots of strong brands present in the market. Dove and Nivea led to the decline in their profit level. However Nila is constantly fighting to retain its market share and to increase its market growth rate in germany. However Nila has a strong base and it is earning revenue in the Indian Market. So if we generalise it from every aspect, Nilas degree of rivalry is very

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