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| The Company plans to establish a network of dealers and franchisees, and 20 depots, which will be monitored from about 6 regional offices across India. The regional offices are going to serve as the node between the manufacturing plants and the dealers / depots / franchisees on the other side. The total number of retail outlets being conceptualized are– Tamilnadu (250), Orissa (50), Andhra Pradesh (750), and CH (50) with initial launch in AP targeting 100 stations in 2009 for current production. |
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| The management believes that coupled with a strong brand building effort it could erect high entry barriers for new entrants. For the brand building and publicity, the Company proposes to build a distinct brand name and identity - it proposes to use the brand name ‘NATUROL’ for biodiesel. |
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| In order to sell petroleum products, in India the sellers are required to obtain a license but the same is not required in the case of biodiesel as it has a higher flash point of 120 degrees centigrade. The Petroleum Act specifies three classes namely CLASS A (flash point below 23 degrees centigrade), CLASS B(flash point above 23 degrees centigrade but below 65 degrees centigrade) and CLASS C(flash point 65 degrees centigrade and above and below 93 degrees centigrade) for which licenses are required. Hence there is no restriction or government control and no licenses or permissions may be required to store, transport or sell biodiesel to any consumer in India. This enables the company to roll out it outlets at a very fast pace and will thus aid in expanding the network. |
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