Ici Dulux Case Study free essay sample

ICI believes that ICI Dulux Paints pakistan strengths include its well-established brands and the global nature of the business which allow ICI Paints to use its resources, expertise and experience to offer the best solution for each local market and the needs of the end users. Great presence in places that the brand is better recognized. ici dulux comes in category of decorative paint market. The decorative paint market can be divided into two broad categories interior and exterior. The interior market as the name suggests refers to the paints being used for indoor decorations. Similarly the exterior market corresponds to the paints being used to decorate the outdoors. The exterior market of paints in Pakistan is of 7 Million Liters. ICI dominates the market share with 4. 2 Million Liters with its Weathershield. Million ICI Dulux has maintained an image of being the most expensive in the category along with providing the best quality among its competitors. ICI has been a 60% market share with its major competitor being Berger. Berger has a 20% market share followed by a 20% share by smaller brands which include Berger, Blackhorse, Silversand, Master, Nippon, Gobi, Hapilac etc. With the help of a lot of promotional activities for its dealers as well as consumers, it has earned a great amount of goodwill over the years. While its competitors concentrate more on variety and mass production and a lot of other different strategies, the company is essentially a quality centric company. ICI DULUX Company is having More than 80 years of experience in the paints industry, offering Wider range of products and Wider dealer network as compared to its competitors. Business volume of ICI Dulux is very high as compared to the competitors and it Focuses on safety, security, health and environment as a corporate social responsibility. ICI DULUX TARGET MARKET: * To target at Decorator firms: Decorator firms decorate interior and exterior structure of large number of offices, buildings, schools, etc. In modern days every entity wants itself to be well decorated and look up to date. A decorator firm comprises of an interior designers who play a pivotal role in selection of a product to be used. These products include paints with good quality, extensive range and varied effects. Moreover, there is an extensive range of 52 two-tone colour ways available on the Dulux tinting system. This could influence the customers of the identified markets by providing them with varied alternatives, especially when it comes to interior decoration and designing in which colour paints hold a prime and significant place. Since Dulux has an extensive range of varied products, so to target them would lead to good sales. * To target at Trade Market: Traders have a firm position in the market; the trade market is a chain that is constituted of super stockists, dealers, wholesalers, and retailers. A super stockist is a small organisation where company keeps their stock to pass it on to the next steps of the market viz dealers wholesalers retailers to end users. A Marketing Manager should aim and target the products to this organisation as the super stockist holds a strong position in the market. Super stockist has a wide range of customer base as he delivers the products other mentioned trade unit s. The market can be achieved by incurring time and money in promotion of products. * To target Construction Firms: Construction firms have a massive business all around. The builders construct large number of buildings for example, schools, collages, hospitals, offices, call centres, etc. The major construction firms usually undertake big construction projects. Their prime concern is timely receiveal of deliveries which they can be assured by Dulux. This can be an excellent source of sales as these firms are always in need of good furnishing and special coloured affect products and that too in a bulk to create their own reputation in the market. These firms are targeted to yield good returns and flourishment is expected. Architects:- they are much quality oriented ,their purchase decision does not depend on the price and the cost analysis so ICI Dulux can target this segment for the high range products ,which a common man cannot purchase ,architects can help in increase in sales of the company and profits. Challenge: In 1973, ICI launched its Weathershield technology in UK. The Weathershield technology reached Pakistan in 1984. but after this , Dulux has not done any innovation for a long time till 2005. In 2005 ICI Paints appointed its first chief marketing officer (CMO). Until then the organisation had been run as a multi-local organisation, with each of the 50 countries including pakistan determining its own marketing strategy. There were examples of local success but performance was patchy, the company struggled to leverage good ideas and, more importantly, growth was slowing. The task for the CMO was twofold: improve the performance of the marketing organisation and create competitive advantage from global scale. Its major competitors were local or regional players, so global reach and scale set the company apart. However, its multi-local operating model was limiting its ability to realise this advantage. A pivotal question the company asked itself was whether it could win against its competitors through simply building local capability and leveraging best practice. Or was there actually an opportunity to create advantage through building a brand image and brand awareness? Because The Dulux name was present in many markets but it was far from being a global brand. Being one of the oldest and the globally trusted brand it has not changed with time. This change which is very cardinal for every company to grow over the years is non existent in Dullux. Dulux has not launched variants and did not plan on it as well. They believed in providing quality and not variety with mediocre quality. the brand has become just a traditional brand. In fact The product is always successful because of its awareness among the customers. Despite of holding a strong position in the market Dulux Paint has not been able to aware the customers fully about the three new products. The knowledge among consumers is very less resulting in uncertainty of the product among them. This is a result of less promotional schemes. There is a high degree of uncertainty about the Dulux paints new products in Market because a large market share was catured by competitors. Among the many challenges to cope with competition there is one more which is the most important one for the brand, it is keeping brand awareness at optimum levels at all times. Long term and short term goals have to be set for the brand and strategy is of utmost importance here. Dulux there needs to be equilibrium of creating awareness even in the areas which have never tapped before. The challenge here now is to tap the niche market in a way which has never been before and to create a new category inside the existing so that an automatic niche is created. Being the first in a category gives an automatic brand standing in the eyes of the consumer. The one important thing to look at here is that the strategic advertising opportunities were not really explores well enough. The awareness of the brand has almost diminished in places where it was already low. There is no brand recognition in most rural areas what so ever. The brand is far from being recognized a paints manufacturer, it has lost its identity in most developing urban areas as well. There is no brand presence of Dulux paints in the economy brands because of which when middle class consumers opted for better quality and premium emulsions they did not consider Dulux, instead, they stuck to the same brand they knew very well. When it comes to media planning and placements, ICI Dulux has been far behind the requirements of the band wagon of pacting. The only thing because of which the brand loses out on popularity is that, consumers nowadays think that if a brand is out of sight it is out of function and so they tend to deviate from it. QUESTIONS: * What are the opportunities to create advantage through building a brand image and brand equity? * What are the factors which are influencing its demand and what will be your target market to capture 80% market share in Pakistan paint industry? * Who are the competitors and how they are threat for ICI dulux? * What are the marketing strategies they must be used to create awareness and reposition the brand? What are the recommendations you can give for this case study? Opportunities: * Dulux Paints has undoubtly a large market available viz builders, merchants, and retailers, that needs to be looked upon. * There is an increased demand of broken colour effects among consumers, hereby creating an opportunity to target them by implementing high promotional schemes. * There is an increase in the technology of painting that can be a boon for Dulux in long run. FACTORS INFLUENCING DEMAND: ICI Weathershield being a premier paint targets mainly the urban areas of Pakistan. It focuses primarily on households. Unlike the usual products where the decision-maker is the final consumer, painters and contractors also have the ability to influence the decision making process. Factors influencing the level of demand; * The housing industry in the largest industry of Pakistan. Pakistan is one of the 20 countries of the world where Real Estate business is on the top of the list. So the housing boom will add fuel to the demand level of paints. * These include the continued migration of rural consumers to urban areas in search of work and an improved standard of living. This improving quality of life will increase in level of demand for the product. * The number of Pakistanis returning to the country having worked abroad will also fuel growth, as these consumers bring with them knowledge of the products available in the west, as well as general lifestyle trends to which they have accustomed. * Rising inflation can cause decrease in the purchasing power of the people ICI Dulux Weathershield Vs Their Competitors: ICI Weathershield dictates prices in the exterior market. All the competitors including the smaller players follow the same pricing strategies. The Biggest competitor of ICI Paints is Berger Robilac; it is local company which is being run by the Big Investors in Pakistan. The price of ICI Weathershield is 5% more than that of Berger’s Weathercoat. Berger has still to come-up with a product to compete with the new Weathershield Fresh which comes with an added feature to repel dust. The new ICI Weathershield is also available in a lot more colors than any other exterior paint in the market. Thus Berger is lagging behind in its product development strategies. We can infer from this matrix that Burger Paints lags behind ICI in marketing and customer satisfaction. Berger| Dulux| Critical success factors | Rating| Rating| Market share | 3| 4| Product range | 4| 3| Customer satisfaction | 2| 3| Quality | 4| 4| Brand franchise| 3| 3| Relative cost | 2| 2| New product activity | 3| 3| Advertising | 1| 3| Sale Of Fake Paint: All personnel interviewed expressed their firm opinion that at least 20% of the paint sold in the local market is â€Å"fake paint† sold under popular brand names. Since ICI Weathershield is the most popular brand for the exterior paint, the percentage of fake paint sold under its brand name is even higher. Although ICI dulux Paints has a large number of authorized dealers and most of these dealers are loyal to the company, however the general public was not completely aware of how to differentiate the genuine dealers. Also some of these authorized dealers are not quite as loyal and ICI Paints has occasionally received complaints in this regard, which ici dulux have dealt with increasing the incentives of dealers. In addition the ICI paint products including the Weathershield is also being sold by other shopkeepers who are not authorized dealers. Paint purchased through these shops has even lower credibility. so ici dulux established their own Point of Sale Tinting and its own Model Shops. ICI Weathershield is supplied in metal containers, which are not sealed in any foolproof fashion. REPOSITIONING Positioning by product attributes and benefits: ICI Dulux Paints have a differentiated identity in the market as they are better and beneficial in comparison to parity products and traditional paints. All these factors can be highlighted catering the market with the help of promotional schemes. This will not only highlight the key qualities of brand but, will also lead to mass awareness in costumers and clarify the essence of Dulux Brands in a unique the most popular brands are; Weathershield Sun Reflect: Innovation has been the key driver behind the success of Dulux in creating the brands and initiative for sustainability. Dulux SunReflect was launched in March 2011. This latest launch, ICI Dulux Weathershield Sun Reflect is a revolutionary exterior paint that reduces the temperature of walls by up to five degrees! Regular emulsions absorb the heat-causing infra red rays of the sun, causing the inside of the house to heat up. Dulux Weathershield on the other hand, created using SunReflect technology, has higher Solar Reflective Index (SRI)-the ability to reflect the heat-causing IR rays. Because of this technology ,Weathershield can reflect IR rays significantly more as compared to regular exterior paints. With the SunReflect technology, the interior will be considerably cooler, and that can actually lead to significant power savings on air conditioning. So not only does it keep homes cooler, it reduces energy consumption with considerable savings on air conditioning. For us, innovation begins with great insight into our customers’ needs and with Pakistan facing its worst energy crisis ever. 1. ICI Dulux Woodcare Shades 2. Dulux Super Gloss finish Enamel 3. Dulux Metallic Finish Enamel 4. Dulux Matt Finish Enamel 5. Dulux Synthetic Enamel Fan Finish White 6. Dulux Pentalite Special Plastic Emulsion (Acrylic Based): Now a days the Television commercial of the ICI Dulux plastic emulsion can be watched which emphasizes the 6134 shades it has. 7. Dulux Pentalite Natural White Special Plastic Emulsion with Added Fragrance (Acrylic Based) 8. Dulux Contractor? s Plastic Emulsion . Dulux Weather Shield (Acrylic Based) 10. Dulux Prime-on 11. Dulux Water Repellent 12. Dulux Once: It is a new breakthrough in paint technology as it completes the job in just one coat. This special emulsion saves time has a high coverage and therefore is highly economical. Coverage: 7-8 m2 /ltr/coat (once is enough) 13. Dulux Synthetic Clear Varnish 14. Dulux Red Oxide A nti Corrosion Metal Primer 15. Dulux Aluminum Paint Dual Pack 16. Dulux Weathersheild Fresh was launched with the features of Fungus guard, Color lock and Dirt Guard. Oil base paint which has no smell; is odourless or has fragrance. It is available in Dulux Matt Enamel, Dulux Enamel and Dulux Pentalite Classic. It would be an achievement to have the same quality available in ICI Weathershield. Positioning by price: ICI Dulux is having† price premium strategy†. because price is an indicator of quality. ICI Dulux can offer relevant schemes of negotiation and has also been able to meet with new trends emerging in the market. ICI is acquainted with flexible product as it has an extensive range of 52 two-ton colour paints. Consumers can be offered any colour scheme according to their needs and on reliable prices in comparison to the competitors POSITIONING BY POPULAR COMPAIGNS Dulux weathershield and enhancing attributes which are known but never emphasized on would be a good positioning turn for the brand. after lets colour project ,dulux has captured 70-80%share in paint market. and the sales of each brand increased through outstanding communication strategy from 2008 till 2012 , â€Å"Lets Colour’ Compaign The mission was to spread colour all over the world – a bold and immense task. ‘Lets Colour’ was launched as an initiative to makeover targeted drab looking buildings with the help of local communities. By launching a campaign,   Dulux hoped it would inspire audiences to regenerate anything – big or small, inside or out, with colour paint. To get local communities interested in taking part, momentum was built around a social media campaign. The project started with the launch of a ‘Lets Colour’ project blog – with blogs being the channel that the brand saw as the most open and direct way to start sharing its project with the public. Ici dulux started this compaign to increase the awareness in people mind so that they can build the brand equity. they held different events and increase the customer brand resonanance. he events include in this project are: IAPEX 2011 â€Å"Building Materials Exhibition†: ICI Dlux sponsored the â€Å"Building Materials Exhibition† held at the Expo Centre Karachi in May 2011. The event was organized by the Institute of Architects Pakistan (IAP) to provide one-stop solutions for homeowners, builders and  interi or designers on the latest products, ideas and emerging architectural techniques in the field of building and construction. The event attracted 250 architects from all over Pakistan, 400 architectural students from various universities and around 10,000 general visitors. IAPEX Karachi 2012: Institute of Architects Pakistan, Karachi Chapter organized its seventh international exhibition of building products in which more than 100 exhibitors displayed their stalls. The ICI Dulux stall won the 1st prize at IAPEX Karachi 2012. * CSR Activities * Lets Colour Mayo Hospital: On 9th April, volunteers from ICI Dulux along with students from National College of Arts and employees from BF Bioscienes enthusiastically participated to add a splash of colour to the cancer ward at Mayo Hospital * PIID Road Show Lahore 2011 * PIID Road Show Karachi 2011 Own a Color * Lets Colour Layton Rehmatulla Benevolent Trust * ICI Dulux Stall wins at IAPEX 2012 * Transition Event held at ICI Paints Business * L et’s Color Week: Color Week was about celebrating the transformative power of color and how it can improve lives around us. Running from October 10 to 14, the â€Å"Let’s Color Week† helped employees worldwide discover what they know about color and how they can bring to life the shared ambition of â€Å"Adding color to people’s lives. † The purpose of Color Week was to enable employees to experience color, joy, engagement and a sense of community. There were workshops, contest, e-learning modules, on-ground activities, workspace painting, community painting and many more interested activities to spread the color around. Content was uploaded in real time to the blog and to You Tube, Twitter, Facebook and Orkut. The content was quickly picked up upon by other blogs and online newspapers all over the pakistan, building momentum ahead of the city visits. â€Å"Colour to people’s lives† project in pakistan: The universal insight that had been uncovered for Dulux was that ‘Our surroundings have a powerful influence on how we think, feel and live. We feel good when they reflect who we are and who we want to be. Dulux’s role is to inspire and help people to create beautiful homes and communities through colour. We believe that in doing so we can lift spirits and bring people together. In fact, we sell ‘tins of optimism’ not just tins of paint’. This was articulated through the brand idea of ‘adding colour to people’s lives’. The South East Asia marketing team was immediately inspired by this idea and created a cross- market campaign for Dulux Weathershield that focused on how Dulux transformed a community from a world of grey to a vibrant and colourful community filled with joy. This more emotional approach (backed up by a clear product functionality) proved to be much more effective than the previous campaigns, yielding above average cut-through and persuasion and was seen as new, credible, relevant and unique. Tex Gunning (Managing Director, Decorative Paints at AkzoNobel) announced Pakistan as the global winner of the Most Colorful Workspace Contest and commended Pakistan saying â€Å"Pakistan has done a stunning job of celebrating colors†. ICI Dulux Thematic Campaign A Theme for Every Dream 2011: This campaign centered on the tagline ‘A Theme for Every Dream’, and reinforced the ICI Dulux brand personality as the leading innovative one-stop shop decorative solution provider in Pakistan. The campaign subtly introduced AkzoNobel as the new parent company and highlighted ICI Dulux groundbreaking services such as Customer contact center (0800-Dulux), color consultancy/interior decoration advice service and color studios. All communication platforms including television, radio, newspapers,internet and outdoor exemplified an assortment of colorful themes nationwide. POSITIONING BY COMMUNICATION STRATEGIES: As ICI Dulux has a diversified market it has to use a number of promotional Tools. ADVERTISEMENT Television Advertisement 1. It is a very expensive tool of promotion but it is worth it. ICI Dulux though still advertises through Television commercials but it has reduced its intensity. They just use it to create awareness among their target market about a certain product   and try to highlight its main selling features. Dulux used the famous TV channels like GEO TV, Hum TV, and PTv. In Karachi and Lahore, hower they also used the local cable television’s to launch their advertisement. Now a days the Television commercial of the ICI Dulux plastic emulsion can be watched which emphasizes the 6134 shades it has. Radio Advertisement It is a relatively cheaper source of advertisement and due to the channel FM 100, the number of listeners has increased. Therefore Dulux finds it effective to communicate with its customers through radio. Print Advertisement Besides the heavy investment in electronic media they also give stress on the print media as well. A substantial pairt of Dulux’s total promotional expenditure goes under this head. ICI has used the flyers to distribute through local agents to different leaders. The dealers distributed the flyers to different people. Approximately all the good and standard magazines carry the advertisement of ICI Dulux. They also used the newspapers like Jhang, Khabain and Dawn for promoting their brand. They spend 35% of its total media budget at print media. The stylish decorative signs in newspapers also they used teasers ad in newspapers to increase the curiosity and awareness among the customers. Point Of Purchase Advertisement Many colour cards, brochures and other informative material is available at dealers shop along with the product itself in attractive cans. The dealers display contest is another kinds of advertisement. New dealers are registered where intensive contraction is being done. Point of Sale Tinting (POST); ICI Dulux Point of Sale Tinting (POST) offers over 2000 shades available all over Pakistan at designated dealer outlets. Colour consistency and quality is our forte and our customers can be confident that the colour they bring home is exactly what they paid for. ICI Dulux Model Shops: . Masses are becoming conscious of latest trends and are taking greater interest into nitty-gritty of the lifestyle. ICI Dulux Model Shops will act as a one stop solution for our customers where they can have access to all the products amp; services including Point of Sale Tinting (POST) ,paint calculator and paint selector through computer. Wide range of colors to choose from. ICI Weathershield is available in 6,134 shades as opposed to Berger’s Weathercoat which only comes in 12 basic shades. Some of the shades of Weathershield are shown. These shops are also selling uniqe machines like ICI Dulux POST Mixer and ICI Dulux POST dispenser. ICI Dulux POST Mixer ICI Dulux POST dispenser ICI Dulux Colour Studio Lahore Hyperstar After the great success of our colour studios in Karachi and Islamabad, ICI Dulux Colour solution center was launched at Hyperstar Lahore. The studio is at par with international standards and is equipped to provide complete interior decoration solution and superior shopping experience. The state of the art facility provides a complete one stop solution to all customer needs including: * Free Colour consultancy * Interior and exterior decoration advice through â€Å"colour selector touch screen technology† * Technical assistance Product information * Product Complaint * Paint estimation * Paint Previews * Dealer Guide Out Door Advertisement People are exposed to outdoor advertising and almost 40% said that mostly while driving they get sight at billboards, road signs, banners and road screens or new strips. Almost 20% people are exposed to outdoor advertising, when they. One at signals and around 15% people notice them when they are on walk. Bill boards: Bill boards were also been used to promote the product. These sign boards and bill boards’ dectronic were equipped with light facility for night viewing as well. That gave travlers to look at them and create attention. Special billboards were placed in Kashmir valley after earth quack for promoting their brand. Our projected billboards would be as follow. Lahore Laxmi chown, Muslim town main Karachi Main Tariq road difton chowk-chandigarh. INTERNET At internet dulux developed its website that will help people to communicate with the people because in Pakistan internet growth is increasing a more people are moving towards it. ICI is 200000 on internets to spending create awareness in people. Painting Problems: Causes amp; Solutions Ici dulux has increaseed customers awareness of typical painting problems and develop their ability to understand the causes and offer solutions for how they can be rectified. all solutions are available on ici dulux website. dealers also help and give advices to their customers. this service has solved mainly the problems of customers working in fine arts and fashion industry as well as painters. Three Factors In general a paint fault can be caused by one, or a combination of, three factors: 1. The decorator/painter. 2. The area or substrate (surface) painted. 3. The paint. Painting Problems: * Low Opacity * Brush mark and Poor Finish * Chalking * Peeling/Flaking * Cracking/Flaking * Lapping * Uneven or Patchy Appearance * Poor Smudge Resistance amp; Washability (Scrub) * Poor or Un even gloss * Skin Formation * Settling * Poor Drying * Roller Marks/Stipple * Sagging/Curtaining * Shriveling or wrinkling * Yellowing * Poor Alkali Resistance * Blistering * Mould * Bitty Film SALES PROMOTION Sales promotion is also a very important promotional tool used by Dulux in which different short term and long term incentive schemes are offered to the dealers. Sometimes the company provides the dealers with extra discount if they sell upto or more than a target amount preciously decided. Now Dealers are also given small incentives like T-shirt, wall clocks, folders, brochures, pen holders etc in return of the sales promotion. Dulux paint pad: Painting walls just got easier with dulux . the pigment pusher has just unwrapped the paint pod,a device that pumps paint directtly to a roller attachment. hit the button and the paint pod,loads its roller with the correct amount of paint. t even cleansitself up when you have finishe corating,taking amere ten minutes to rinse all the paint out of its system. all it requires is its own 5 liter paint packs for this worth 100,000 rs. The machine would be given at 50% discount. the distribution of this machine would be through our establish channels. we would give these products to our dealers also;this machine can be used as affordable and easy to use. this paint pad would be available only in islamabad/ rawalpindi,lahore and karachi. Pick up yor mate: The dulux is offering free paint brush on purchasing three gallons of any dulux variant. he brush is high quality and this is given with purchase on paint . also we can give more value to this because it adds more value to the customers. Personnel selling: The ici dulux is having the prestige of using the direct channel to communicate the customers as well. the more of the decorate paint is sold to business and government markets. in this dulux will deliver the service at doorstep. the dedicated and profssional sale staff is motivated to remain in contact with business and government markets. Free Dulux Colour Advisory Service They say â€Å"for our valued customers, expert help is available through a creative colour consultancy service provided free of charge. Our colour Advisors would be available to develop innovative colour schemes to bring out the best in your home. † This is the most important promotional tool and helps to generate maximum demand. TTF (Trained task force) is a trained mobile team which  reaches at the place where construction or revocation is being done, just on a single phone call. They sometimes reach at the point of construction or renovation with our being called and give the customers free advice. Another mobile service available is the LCA ( Lady colour Advisory Service)   where innovative and creative ladies give advice about the colour scheme of the house. If the customers have any kind of problem or complaint the mobile teams are always there to help them at toll free number (0800-Dulux). Services offered: Public relations: We are going to start in future the â€Å"Paint My Life† And† Lets Colour Beautiful Homes†compaign. the aim of this compaign are to aware consumers and people about the charms of life. we will hold different festivals and concretes for this purpose. this would be mainly in elite areas of pakistan. e would hold these kinds of festivals in schools and colleges. this would give people a way of happiness and an enjoyment place for them. CONCLUSION amp; RECOMMENDATIONS: From the above all discussion I have found that ICI Paints has a lot of resources and well equipped. It is true to say that ICI Paints is Market leader and it is fully ap plying all of its resources on Quality Practices, Customer Retaining amp; Satisfaction, Research amp; Development and Environmental Control, but it needs to show some management commitment to retain its position, because one of its competitors is penetrating in the market. Raising public awareness through advertisement about the fake paint sold in the market. * Taking suitable measures whereby ICI Paints official Dealers are easily recognizable – perhaps by displaying a sign board. * Forward integration: ICI at the moment is depending on dealers for the sale of their products. These dealers store company’s products, retailers have to get ICI products from these dealers amp; then offer customers for sale. If ICI instead of depending on dealers use their own on distribution to supply products to retailers then they can increase the sales of their products by giving products to every possible retailers and in this way they can get acceptance of every retailer to get their product and offer it to customer for sale. ICI dulux should focusing on the end consumers instead of giving tokens to contractors. It believes that this will help develop long-term loyalty from its consumers resulting in repeat sales. * Backward integration: Presently ICI Pakistan is purchasing its raw material from both local as well as foreign suppliers. About 75% material is purchased from foreign countries and 25% is purchased locally. As such as huge quantity of raw material is purchased from foreign countries that’s why change in government import duties have a great impact on prices of raw material which also increase the prices of finished products. Therefore if ICI acquires local suppliers for start making its own raw material then it can save itself from such fluctuations in prices, which could result in the stabilization of prices, and customers can purchase the products at low prices. If ICI gains control over their local suppliers by ownership and take charge of their operation then a significant cost cutting is possible. After getting ownership if ICI start manufacturing all or most of the required raw material locally then they can significantly reduce the volume of import thus avoiding the heavy import duties imposed by the govt. It will result in decrease in cost of product and ICI would be able to offer its product at a relatively cheaper price.