1. A GROUP PROJECT FOR MANAGERIAL ECONOMICS
ON DEMAND ANALYSIS OF EVEREADY PENCIL CELL
SUBMITTED BY:
NAMES ROLL NO.
RITESH ASHAR 11002
NIKITA BALI 11004
NEETHI NAIR 11044
CHANDAN PAHELWANI 11048
HIMANI PARIHAR 11050
SUBMITTED TO:
Dr. KINJAL AHIR,
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2. SENIOR LECTURER, TIMS
INDEX
SERIAL NO. CONTENT PAGE NO.
1. Introduction 3
2. Factors affecting the demand 5
3. Elasticity 9
a. Price elasticity
b. Income elasticity
c. Cross competitive elasticity
d. Cross complementary elasticity
4. Bandwagon effect/ Snob effect 16
5. References 17
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3. INTRODUCTION
In our home if remote control stops working or clock stops ticking and the
reason for it is pencil cell then the brand name which comes first in our minds
is “EVEREADY”.
It was founded on 1896 (as the American Electrical Novelty & Manufacturing
company). Its headquarters are in St.Louis, Missouirs, United States. The key
people in it is Ward m. Klein, CEO.
Energizer Holdings Inc, formerly known as Eveready Battery Company, Inc. is
the largest manufacturers of dry cell batteries and global leader in the
dynamic business of providing portable power.
Since 1913 the Union Carbide and Carbon Corporation took over eveready and
the marketing of this pencil cell was started.
Eveready has a wide distribution network all over the country with 15
branches 40 godowns and around 4000 distributors. The Eveready pencil cells
are available at all small and big shops right from the general stores, grocery
store, music store, stationery stores , gifts and novelty stores, photo studios
and printing centers. Not only that even a small “PAAN VALA” are also selling
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4. the same product. The Eveready has his manufacturing units all over the India.
Not only that they are manufacturing at a high speed. The manufacturing units
of Eveready ISO 9000 and ISO 14000 certified.
Just the figure of sales are enough to know the performance of a company i.e
annual sales 92,530.74 (Rs. Lakh). It has value of Rs.6.5 add in it VAT 12.5%
which gives the rate of Rs.9 in the market.
Eveready Battery Co. changed its name to energizer holdings Inc. and was to
become a public co. listed on the NYSE in April 2000.
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5.  Factors affecting the demand :-
• Main variables:-
(1) Price
(2) Income of consumers
(3) Price of competitive goods
• Other Variables:-
(1) Durability
(2) Availability
(3) Advertisement
(4) Season
(5) Brand ambassador
(6) Government Policy
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6. (7) Geographical area
(8) Brand image
(9) Technology
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7.  MAIN VARIABLE :-
(1)Price:-
In today’s world, price is the most important factor for the
consumer while buying a certain product and the price of our product is
quite reasonable. If the price of increases then also there is no effect in
the demand.
(2)INCOME OF CONSUMER :-
When the income of the consumer increases then the demand of
complementary products is increased and so our product is used for the
same reason. If the income decreases then there is no effect because
people use it as the basic necessity in the products like wall clocks and
remotes.
(3)PRICE OF COMPETITIVE GOODS :-
When the price of competitive goods increases then the demand
of product increases. When the price of competitive goods decreases
then people still continue to purchase it due to its brand image in the
market.
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8.  Other Variables:-
(1) Durability :-
The duration of eveready pencil cell is approximately 3 months in
the products like wall clocks, remotes and 15 days in the products such
as toys, cameras according to their regular use, as per our survey.
(2)Availability :-
It is easily available in all the shops whether it be a small shop or
a general provision store. Its availability is one of the most important
factor that affects the sales of our product.
(3)Advertisement :-
The advertisement of this branded product can be easily seen on
most of the leading channels viewed on television. The product is being
advertised on a large scale
.
(4)Season :-
During monsoon season there is more of power cut problems due
to heavy rains and it is not possible for every Indian family to have a
invertor in their homes, so the best option for them is torch which
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9. works on pencil cells. During vacation period children mostly spend
their time in playing with their toys which again works on pencil cells.
(5)Brand Ambassador :-
The brand ambassador of this product is Mr. Akshay Kumar, the
well-known Bollywood Actor and celebrity. As he is a well-known
personality the product takes the advantage of his goodwill and
reputation to increase the product’s sales.
(6)Government Policy :-
Taxes will obviously have a direct impact on the demand of the
product. Increase in taxes result into increase in prices of the product
and resulting into decrease in the demand of the product.
(7)Geographical area :-
The geographical area or location is a important key in demand of
the product. As per the globalization the technology is reached in every
corner or part of the world. Now a days people are using television,
music system, camera and other gadgets etc so the demand of the
batteries are also increasing there.
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10. (8)Brand image :-
The brand image of the product plays a vital role in the demand
of the product. The brand image of the product is very good. This
product is in market since many years when there had been no such
competitors, so people trust this product due to its goodwill in the
market owned by the product.
(9)Technology :-
As there is advancement in technology, that would affect the
demand our product i.e. increase in quality of the product, its
durability will improve.
(3)ELASTICITIES:
A. PRICE ELASTICITY :-
The price elasticity of demand is percentage change in demand
divided by percentage change in price. Price elasticity of demand
measures the willingness of consumer to buy at the price available.
Formula:-
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11. Ep: (Q2-Q1)/[(Q2+Q1)/2]
(P2-P1)/ [(P2+P1)/2]
Price Per Piece Quantity Demanded (Pieces)
A. Rs. 8 (P1) 14 (Q1)
B. Rs. 9 (P2) 12 (Q2)
C. Rs. 10 (P3) 11 (Q3)
Ep1 = Increase in price elasticity
Ep2 = Decrease in price elasticity
Ep1 : Q2 – Q1 x P2 + P1
Q2 + Q1 x P2 – P1
= 12 – 14 x 9 + 8
12 + 14 x 9 – 8
=-2 x -17
26 x 1
=-34
26
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12. = 1.31
Ep2 = Q3 – Q2 x P3 + P2
Q3 + Q2 x P3 - P2
= 11 – 12 x 10 + 9
11 + 12 x 10 – 9
= -1 x 19
23 x 1
= -19
23
= 0.83
B. INCOME ELASTICITY:
Income elasticity and demand both have direct relation
between them. If income increase the demand of the
quantity also increase and if income decrease also decrease
and it has always positive relation in demand of income
elasticity.
Income Quantity of Demand
A Rs.13500 12
B Rs.15000 12
C Rs.16500 14
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13. Ey1 = Increase in income elasticity
Ey2 = Decrease in income elasticity
Ey1 = Q2 – Q1 x Y2 + Y1
Q2 + Q1 x Y2 - Y1
= 14 – 12 x 16500 + 15000
14 + 12 x 16500 – 15000
=2 x 31500
26 x 1500
= 63000
39000
= 1.62
Ey2 = Q3 – Q2 x Y3 + Y2
Q3 + Q2 x Y3 – Y2
= 12 – 12 x 13500 + 15000
12 + 12 x 13500 – 15000
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14. = 0 x 28500
24 x -15000
= 0 (no effect)
C. CROSS ELASTICITY:-
Cross elasticity of demand has two factors and they are
competitive goods and complementary goods.
(1)Competitive goods:-
In it the price of competitive goods and quantity of our
product has inverse relationship and it has always positive
demand.
Competitor Quantity
price Demanded
8(P1) 13(Q1)
9(P2) 12(Q2)
10(P3) 11(Q3)
Ec1 = Increase in competitive products
Ec2 = Decrease in competitive products
Ec1 = Q2 - Q1 x P2 + P1
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15. Q2 + Q1 x P2 – P1
= 12 – 13 x 9 + 8
12 + 13 x 9 - 8
= -1 x 17
25 x 1
= 0.68
Ec2 = Qx3 - Qx2 x Pz3 + Pz2
Qx3 + Qx2 x Pz3 – Pz2
= 11 – 12 x 10 + 9
11 + 12 x 10 – 9
= -1 x 19
23 x 1
= -19
23
= 0.83
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16. (2) Complementary goods:- In it there is direct relation between
price of complementary goods and quantity of our product and it
has always negative demand.
Price Quanity
50(P1) 25(Q1)
100(P2) 20(Q2)
150(P3) 15(Q3)
Ec1 = Increase in complementary products
Ec2 = Decrease in complementary products
Ec1 = Q2 – Q1 x P2 + P1
Q2 + Q1 x P2 – P1
= 20 – 25 x 100 + 50
20 + 25 x 100 - 50
= -5 x 150
45 x 50
= -750
2250
= -0.33
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17. Ec2 = Q3 – Q2 x P3 + P2
Q3 + Q2 x P3 – P2
= 15 – 20 x 150 + 100
15 + 20 x 150 - 100
= -5 x 250
35 x 50
= -0.714
(4) Bandwagon effect/ Snob effect:-
In this case its bandwagon effect, it means the people attitude
towards the product depends upon the word of mouth.
According to our group survey, the customers of our product is
affected by bandwagon effect. The word of mouth is the affect
given by the customer. Mostly people convince themselves by
other people view about the product. The reasons given by the
customers for the use of this product is its durability, efficiency and
long life of the battery.
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18. Suggestions:-
According to our survey it is clear that the price of this product is
reasonable comparative to others and comparing to the
competitive product it gives a good outcome in its durability.
It has also been suggested by our consumer that there should be an
improvement in the packing and it should be more attractive.
Consumers also suggest that the company should keep a scheme so
that the product is advertised on a large scale and it would also
attracts other buyers to purchase the product. Like collaborating
with the companies producing clocks, toys, cameras, etc. and all
other companies who sell the products which run on pencil cells to
give Eveready pencil cells to the customers who buy such products.
REFERENCES :-
WWW.Evereadyindustries.com
WWW.Fundinguniverse.com/company_histories
WWW.Google.com
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