Report on market potential for financial services in industrial estates for financial services division; Apple Industries Ltd.

Abstract

The basic objective of this project was to assess the market potential for the finacial services provided by the Apple Financial Services Division. It was decided to cover Peenya Industrial Estate as exhaustively as possible for sampling purposes of this survey. For this purpose, all the firms which were member of the Peenya Industries Association were chosen. 150 of this firms were personally surveyed and rest were sent questionnaire by mail. To evoke a better response from the respondants a special 1% discount on service charge was offered to all respondants.

A detailed analysis was carried out using the 150 manual responses and 50 response?? from the mailed questionnaires. The major findings were as follows: In car finance market, there exist a potential of 170 cars. in "near future" (implies <3 months to 1-2 yrs.). Breakup of this near future shows that. a potential of 72 cars in next 3 months, 38 cars in next 3-Smonths, 10 cars in next 9-12 months and 46cars in next 1-2 yrs. (using the 30% avg. rate of availing of car finance in past, this 30% avg. rate was also revealed from this study). The national avg. rate is 60%, i.e., 60% of the cars purchase are through help of car finance schemes.

Awareness level about Apple Car Finance is quite low, 76% of would-be car-owners were just not aware about the Apple's schemes. Citibank has the highest penetration and highest awareness.

Maruti 800, Maruti Van and Premier cars have been quite popular models. 80%,01· these would-be-car-buyers already have at least one car. There is ample scope for refinance services. In Hire purchase / Lease finance, most of the small-scale firms greater market could not satisfy the norm of annual sales turnover being than Rs. 75 lakhs. If the asset criteria (at previling prices & not balance sheet figure) can be put along with the turnover criteria, Apple will be able to tap into much larger segment.

In Trade finance, very few firms have bills amounting to more than Rs. 5 lakhs. Also, Apple's discount rate are much higher than the subsidized discount rates offered by the banks.

Some of the recommendations given were as follows: Immediate steps should be taken to increase the awareness level about the Apple ??are Finance. To specifically target the Peenya Industrial Estate firms, hoarding at the main approach' road to Peenya should be used. Similarly, at the Maruti dealer's showroom site, Apple Car Finance advertising should be displayed. Similar steps should be taken at the other industrial estates and Premier car dealer showroom sites. Special scheme targeted at the industrialists should be launched, ego a special scheme for Maruti Zen could be floated. Thus vital step is to increase the market presence and remove the image of Apple being just a computer training firm. Only by taking a proactive stance and by aggressive marketing of innovative schemes will Apple be successful in tapping the industrial estate segment.