JDM OILS: DECIDING ON A GROWTH STRATEGY Harvard Case Solution & Analysis



J.R Dhingra is a founder of JMD Oil Company, which was established in 1987. Dhingra supervises the work of all the employees in the organization. Moreover, his four sons also work under the supervision of his father, Dhingra. The company initially performed its duties as oil retailer and after being successful in its retailer business the company progressed to a distribution system as well as started marketing its products in 2000. The company sourced most of its products from the contract manufacturers, which would help the company in achieving its target goals and objective in the competitive marketplace. Moreover, after the death of Dhingra, his sons obtained the services of manufacturing, which helped the company in acquiring its loss-making Quality Diary with its production facilities for milk-based foodstuffs. The company was undertaken into the manufacturing and advertising of enveloped water and bubbling drinks with its H2GO brand. However, by the help of the Garman machinery and technology, the company settled the refining factory, which was located near the port of Kandla in western India. This refining factory generated approximately 1250 tons per day packaging material and in-house power generations, as well as facilitate a marine of 40 Lorries for the transference of oils.

The case discusses the strategic options that the company considered in order to drive a profitability and sales in the business. As per the analysis of the company's previous performance, it has been evaluated that the company transported a top-line (CAGR) compound annual growth rate of 17% and 12% for the bottom line (CAGR). ON the other hand, the projected figures signify the impressive growth which the company generates from the edible oils in India. On the other hand, the company increased its potential growth by increasing the price and demand of the edible oils. JMD Oils are the part of the family owned business which is operated by the four sons of Dhingra. The company has gained numerous benefits from its supply chain and production market in which the company served its products. Moreover, the company does not cater the customers of southern and eastern India, where it isthe potential to achieve a national demand of 22% to 24% respectively. The company has top three soybean oil brands, however, all these brands are not considered as familiar brands. As the company wants to achieve high profitability in the market, therefore, it decided that the company would increase the sales volumes and gross margin of the company, which would help it in achieving its targeted profitability in the highly competitive market as well as help them in achieving its higher market share in the oil refining industry. Furthermore, the management team evaluated that if the company wanted to increase its profitability in the market, then it was necessary for the company to focus on the geographical footprints which would help the company in achieving its high sales volume and gross margin in the highly competitive market. The company would achieve the geographical footprints by acquiring additional factories. On the other hand, it also expected that the company would create a strong brand image in the market which would help the company in increasing its profitability in the highly competitive market. The company could also achieve high gross profitability in the market if it shifts its dealer push strategy to a consumer pull strategy, due to which the company would be able to accomplish through brand structure.

As the company has limited resources, the CEO of the company is confident that they would easily increase the required capital by implementing the initial public offerings (IPO). The company has presented its implementation plan to the investors through that investors evaluate the decision process of the company and activities, which it would wanted to adopt in the organization in order to increase its sales volume and profitability.......................

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