Grasim Industries Ltd and VSF - Expanding a Commodity Market through Branding and CRM
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Case Code : BSTR214
Case Length : 26 Pages
Pages Period : 1999-2006
Organization : Grasim
Pub Date : 2006
Teaching Note : Available
Countries : India
Themes: Business Strategy | Product Development
Industry : Textile,
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
In 2002, Grasim unveiled plans to create a new brand identity for
VSF by replacing the brand Birla Viscose with Birla Cellulose. The re-branding efforts took months of discussions with
its marketing consultants, Quadra Advisory and its ad agency Lemon.
Grasim wanted to create an identity which denoted naturalness, and a feeling of comfort and softness, and which would help it compete against imports as well as other fibers. The logo, in a vibrant green, was intended to underline the fashion element for which VSF was admired among some of the world's leading designers...
The Impact of 'Service Beyond VSF'
According to company sources, the "Service beyond VSF" strategy was a remarkable success.
The strategy was believed to be directly responsible for increasing its key customers' asset utilization by 18%,
and their fiber to yarn recovery by 1%, and for bringing about a 40% improvement in quality in their products..
In 2004-05, in order to cater to the rising demand for its VSF, Grasim increased the installed capacity of VSF by 3,650 tpa to 257,325 tpa through de-bottlenecking.
Grasim's factories, which need large quantities of water for VSF production, faced problems due to water scarcity at several locations. The problem was particularly acute at Nagda. This diminished the ability of its factories to meet demand. To overcome this problem, Grasim increased the height of its water reservoir at the Nagda
plant in 2004, and also implemented several schemes for water conservation...
Exhibit I: About Viscose Stale Fiber (VSF)
Exhibit II: Grasim Industries
Exhibit III: Production at Various VSF Plants of the AB Group
Exhibit IV: A Production, Consumption and Prices of Major Fibers
Exhibit V: Birla Cellulose
Exhibit VI: Value Chain of VSF
Exhibit VII: Comparison of Properties of Cotton, Viscose (VSF) & Polyster
Exhibit VIII: Production and Sales of Grasim's VSF
Exhibit IX: Major Players in the Fiber Market
Exhibit X: Lenzing AG