Sales & Distribution Final

ITC LIMITED

GROUP –B9

Industry Overview

Segments : Organized & Unorganized sectors (60% - 40%) Exports: 10% of the Annual Productions (Annual Production

2009:18.68 lakh metric ton). Imports: Insignificant Marketing: Wholesale & Retail Marketing is carried out with a

network of C & F Agencies (for states and/specific Districts) Dealers/ Wholesalers and Retail Shops.

Biscuit Industry: Especially The Small & Medium Sector, Consisting of around 150 units.

Per Capita Consumption: 2.1 kg as compared to 2.5 kg to 5.5 kg in South Eastern countries and European Countries & USA

Popular Brands: Britannia, Parle, Priyagold, Sunfeast. Value of the Industry: Rs. 65 Billion

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Market Share*

Organized Sector

Unorganized Sector

60% 40%

Urban Rural

85%-75% 65%-55%

Sector Wise Population Wise

* Data from Indian Biscuit Manufacturer Association

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Players in the market

Parle G Britannia ITC – Sunfeast Unibic Priya gold Horlicks Others

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Market Share*

North Zone 25%

West Zone 23%

East Zone 28%

South Zone 24%

Parle 40%

Britannia 28%

Priya Gold 15%

ITC 11%

Rest 6%

Region Wise Brand Wise

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* Data from Indian Biscuit Manufacturer Association

Industry – Annual Growth Rate

2004 15%

2005 14%

2006 14%

2007 13%

2008 15%

2009 (June) 17%

Annual Growth Rate* Line Graph

* Data from Indian Biscuit Manufacturer Association

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Company Overview - ITC

ITC is one of India’s foremost private sector companies. It is engaged in diversified businesses.

The Group’s business is divided into 5 segments: FMCG Agribusiness Paperboard, Paper & Packaging. Hotels Others (IT, Investment, Golf, Lifestyle Retails, Greeting

Cards etc.)

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ITC Food Division

The foods business is newest and smallest business of the conglomerate

Revenue Last Year (FY 2009): Rs. 23, 000 crore  It faced a tough road when it began operations in

2001, with severe competition from existing players. Biscuits have been the biggest driver of the foods

division, contributing over 35% of the top line, followed by staples. 

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Products & Services

Agricultural Commodities. Branded Garments Cigarettes Greeting Cards Incense Sticks Marine Products Packaged Foods Safety Matches

Golf Hoteliering IT Based Services Investments

Products Services

(Staples, Confectionery, Biscuit, and Snack Foods)

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 Bangalore City Chennai Coimbatore Hyderbad Rayalseema Ernakulam

Bangalore Karnataka TOTAL

Confectionary 1200 1440 3072 924 948 2484 960 11028Bingo 17676 8928 276 7392 96 492 132 34992Atta 261084 240552 50076 434508 127020 22944 56412 1192596Biscuits 7992 12300 18516 3816 5376 6936 7692 62628Matches 33000 100332 71892 39300 172704 136020 30576 583824Agarbatti 64308 111444 122436 269304 352620 54984 49464 1024560Soaps &Shampoos 618648 515292 746016 499956 563088 671316 536532 4150848TOTAL 1003908 990288 1012284 1255200 1221852 895176 681768 7060476

 Bangalore City Chennai Coimbatore Hyderbad Rayalseema Ernakulam

Bangalore Karnataka TOTAL

Confectionary 1056 1296 2976 864 924 2388 888 10392Bingo 15048 8424 240 7308 84 456 120 31680Atta 233664 218556 46824 382548 107976 21348 49608 1060524Biscuits 6252 10200 15564 3660 4944 5520 6384 52524Matches 31416 98124 63720 36132 152508 123984 29988 535872Agarbatti 63144 110580 118392 262776 342492 54012 49188 1000584Soaps &Shampoos 598380 487356 716004 481560 538572 631476 504012 3957360TOTAL 948960 934536 963720 1174848 1147500 839184 640188 6648936

Sales Figures of Different product Category for 2008-09* - South

Sales Figures of Different product Category for 2007-08* - South

10* in terms of Volume

 Bangalore City Chennai

Coimbatore

Hyderbad

Rayalseema

Ernakulam

Bangalore Karnataka

Confectionary 14% 11% 3% 7% 3% 4% 8%

Bingo 17% 6% 15% 1% 14% 8% 10%

Atta 12% 10% 7% 14% 18% 7% 14%

Biscuits 28% 21% 19% 4% 9% 26% 20%

Matches 5% 2% 13% 9% 13% 10% 2%

Agarbatti 2% 1% 3% 2% 3% 2% 1%Soaps &Shampoos 3% 6% 4% 4% 5% 6% 6%

Growth Rate of Different Product categories of ITC for South

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Customers and their Locations for South.

Total Distributors for ITC – South Region (No. of Territories)a. Bangalore – 15b. Chennai – 53c. Coimbatore – 55d. Ernakulum- 67e. Hyderabad – 19f. Karnataka – 85 g. Rayalseema - 67

Total customers of ITC:a. Total SWDs* – 11155 SWDs

Total customers in Bangalore:a. Total SWDs* in Bangalore – 657 SWDs * SWD – Secondary Wholesale Dealer

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BANGALORE

Classification of Customers

1. Convenience Stores: Pan Beeda, Tea Shops

2. Grocery Stores3. Chemist Shops4. Modern Trade: Big Bazaar, Food

Bazaar, Spencers, Star Bazaar, Spar, More, Reliance Fresh

5. Secondary Wholesale Dealers

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Customer wise buying potentials for Sunfeast Biscuits*

Channels wise Customer

2008-09 % to total 2007-08 % to total

Convenience Stores

2360 11% 1658 10%

Grocery stores 7936 38% 6420 40%

Chemists Shops 136 1% 92 2%

Modern Trade 1220 6% 844 5%

SWDs 9288 44% 6872 43%

Total 20940 100% 15886 100%

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* in terms of Volume

TerritoriesDistributor Territory Distributor Territory

Bina Enterprises

Banaswadi, Kammanahalli

Saphire Yeshwantpur,Mahalakshmi LayoutRajajinagar

DA Sons Vijaynagar, Chandra layout, Majestic, Navrang

Santhosh Commercial

Whitefield, ITPL, Domlur, Marathalli

Dwarka Jayanagar, J.P Nagar Savi Enterprises

Electronic city

Emerald Kormangala, Madiwala, Adugodi, HSR Layout

Shri Shakti Enterprises

Yelahanka, Peenya,Dasarahalli

G N Marketing

Ulsoor market, Indiranagar

Siva Traders Bommanahalli, Chandapura, Hosur Road

M A Associate

Gandhinagar, Basavangudi, N R Colony

Sri Venkateshwara Enterprises

Hebbal, Mysore Road

Rushabh Neelsandra,Shivajinagar

TCS Dodballapur

Devanahalli, Bagepalli,C B Pur, G B Pur

TCS & Sons Bannerghatta Road

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Territories in Bangalore

Total Territories – 15 Territories assigned by ITC:1. 4 each salesperson is assigned by the company

for each product category to a distributor Company sales person -3 (1 in distributors

office) Trainee -1 2. No two Salesperson will cover the same

distributors3. Territories are assigned based on the orders

generated by the salesperson and conversion of the order into sales.

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Territories in Bangalore

Territories assigned by the Distributor:

1. 1 each salesperson is assigned by the distributor for each product category falling under his territory

2. Distributor assigns his salesperson based on the order generated by him for what he is assigned.

3. Salesperson will cover the entire outlets in the distributors areas based on routes.

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Routing19

Every day salesperson has to cover min. of 30 outlets and max. of outlets for that particular route for which route is pre-scheduled

Different routes on different working days of a week so that entire territory is covered

Retail Shop Visited

Sriram Tarders Contacted Person’s: Mr. Hariram Vishnoi Phone Number: 9414571929

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Comparison - 121

Comparison - 222

Comparison - 323

Scheduling24

Sales person of the distributor must visit every outlet of his product category frequently (once a week).

A detailed report of the days’ work should be uploaded in the company server from the distributors‘ office.

Has to pre-assign time to be spent at each outlet

General ManagerMarketing

RSM(South)

RSM(North) RSM

(east)RSM(west)

ASM

Senior Sales Persons Junior Sales Persons

Sales Organization

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B2B & B2C Sales force

Different sales person for B2B & B2C customers.

B2C channel is the regular sales force through distributor.

A separate team looks after the B2B sales for ITC.

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Selection & Training

Referrals, Campus S&D experience preferred On the job training. Going on calls with Sr. Sales Executives in

the field for atleast 6 months and also along with the distributor salesperson.

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Motivation, Compensation

Working for brand Sunfeast Biscuits Sales Exec. – 15,000 p.m Incentives – Gifts like Trips, Durables etc. on

achieving Sales target. Cross Promotion Gifts – Coupons, Benefits

etc. Best Sales Exec. Award – Once in 6 months Contests : Kaun Marega Sixer ?, Sunfeast

Premier League etc. Sales Manager -: 3-5 lacs p.a.

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Evaluation

Sales Manager evaluates every month Managers appraised on basis of reports

and results Sales manager – Regional Manager- Area

Sales manager

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ITC

Convenience

Stores

Distributors

Grocery stores

Chemists shops

Modern Trade

Secondary Wholesale Dealers

Channel Design

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Channel Objectives

To maximize sales under each channel To produce maximum support to the

distributor from order generation upto sales

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Factors in Channel Design

Huge market potential Spread in vast areas – Easily Accessible

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Company Factory North

Company Factory North

Company Factory East

Company Factory East

Company Factory West

Company Factory West

Company Factory South

Company Factory South

Distributor

HubHub WSP (warehouse)WSP (warehouse)

Convenience Stores

Convenience Stores

Chemists Shops

Chemists Shops

Grocery Stores

SWDs

Distribution Channel

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SWOT ANALYSIS of ITC

STRENGHTS: Developing new brands for new segments Diversified company trading in number of

business sectors

WEAKNESS: Still uses its original name, despite the negative

connection of tobacco with poor health and premature death

Dependent upon its tobacco revenues to fund its FMCG products

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SWOT ANALYSIS of ITC

OPPORTUNITIES: Certain brands can be developed using

strategies of market development, product development and marketing penetration

ITC is moving into new and emerging sectors including Information Technology, supporting business solutions.

E-Choupal initiative to links rural Indian farmers using the Internet and the Novel way of following the same

Per capita consumption of personal care products in India is the lowest in the world.

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SWOT ANALYSIS of ITC

WEAKNESS/ CHALLENGES: Domestic & International competition. Entrance

of new competitors to the Indian market Threat of competition from existing competitors

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FAB ANALYSIS37

Features Advantage Benefit

Prime Location of outlets

Easy availability Convenient basically for shoppers, travelers, office going people as it is basically located near malls, railway stations and inside MNC’s etc.

Product Assortment Provide different varities of items which is easy to cook & eat like Kitchens of India, Pasta etc

Satisfies hunger and provides satisfaction

Areas Needing Improvement

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Continuous production & supply of different varities of biscuits throughout the year

Come up with specials schemes to retailers (SWDs) and end customers in the form of gifts or benefits inorder to make them buy more of Sunfeast Biscuits

Motivate the retailer to buy Sunfeast biscuits by offering better PTR compared to that of other Competitors

Continuous touch with the wholesaler & retailer (SWD) to build up a strong relationship

Introduce new varities of biscuits that differentiates Sunfeast from other players in the market. Eg- Cookies.

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THANK YOU