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MARKETING PROJECT

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PROJECT REPORT

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MARKETING PROJECT

  1. 1. PREFACE The project report contains material collected from the study on “Distribution Channel” in J.K Tyres Ltd, Guwhati, as a part of the course curriculum of 3dr BBA; NEHU. As regards to the subject, it can be said that; marketing is an essential element for the proper functioning of the different companies. Without marketing the vital communications between the manufacturer sand the consumers does not exists. And thus the term marketing management is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals. Now, as regards to the topic, it can be said that distribution channels are sets of interdependent organizations involved in the process of making a product or service available for use or consumption.
  2. 2. ACKNOWLEDGEMENT The project work done by me was not entirely out of my own effort, but also the co-operation of many useful hands. The work would not have been made possible and so systematic if the helpful hands would not joined hands with me to conduct the meritious outcome of the survey. First of all, I would like to thank the Almighty because nothing could have been possible without his blessings and divinity. Next, am very much indebted to our Principal Father V.A Cyraic, my teachers Sir Sanjeev Hazarika(HOD) Department of Business Administration, Sir Bilrak k Marak. Sir Sendrik A Sangma and Sir Paul Hrangkhawl for their help and support. Thirdly, I would like to thank my friends and family members for their constant help in conducting my project work. Also I would like to acknowledge my thanks to the ex-senior students whose projects were of great help in preparation of my project Last but not the least; I would like to thank Mr. Debarikhav Phukan, the sales and service engineer (truck Radial) for helping me to out in giving the relevant details of the required topic and thus helping me to prepare my project report efficiently. Thus, I acknowledge my thanks to all of them, without whom I would have not been able to carry out my project preparations so successfully. SWARNIMA TIWARI
  3. 3. CHAPTERS 1. EXECUTIVE SUMMERY 1.1 Introduction 1.2 Importance of the subject 1.3 Reasons for selecting the topic 1.4 Reasons for selecting the company 2. COMPANY PROFILE 2.1 Introduction 2.2 Core values of the organization 2.3 Introduction to the company 2.4 General Information 2.5 Their Plants 2.6 Their vision and Mission 2.7 Organizational Chart 3. HISTORY OF TYRES 3.1 General Information 3.2 Tyre Technology 4. DISTRIBUTION DEPARTMENT OF THE COMPANY 4.1 General Introduction to the department 4.2 Functions of the Department 4.3 Organizational setup 4.4 Pictures of the C&F 5. TOPIC THEORY 5.1 Introduction to the topic 5.2 Characteristics of distribution channel 5.3 Role and Importance of distribution channel 5.4 Functions of distribution channel 5.5 Types or classification of distribution channel 5.6 Major types of intermediaries in distribution channel 5.7 Types of channels in distribution channel 5.8 Factors governing the choice of an intermediary 5.9 The channel policy and strategies 5.10 Some other dimensions of channel management Page No. 1
  4. 4. 6. DISTRIBUTION OF J.K TYRES LTD 6.1 Distribution pattern Of J.K tyres Ltd 6.2 Map showing J.K tyres operation in India 6.3 Their operation in North-East India 7. RESEARCH OBJECTIVE AND METHODOLOGY 7.1 Research objectives 7.2 Research methodology 8. METHODS OF DATA COLLECTION 8.1 Introduction 8.2 Methods of data collection 9. GRAPHICAL REPRESENTATION OF DATA 10. LIMITATIONS 11. CONCLUSION 12. ANNEXURES 13. BIBLIOGRAPHY
  5. 5. 1. EXECUTIVE SUMMERY 1.1: INTRODUCTION: Marketing Management usually represents all managerial efforts and functions to operate the marketing concept not only in letters, but also in sprit. It is a concept, combining the various elements of Marketing and Management. In the “Marketing concept”, it usually demands customer-oriented marketing plans, programs and policies so that the market can assure perfect positive correlation between the supply and customers desires and expectations. In the “Management concept”, it usually deals in the management cycle of planning, effective implementation, evaluation and control, feedback and re-planning. Thus combining the two concepts of Marketing and Management, we get the full concept of the term Marketing Management, which represents a vital functional area of Business Management efforts for the flow of goods and services from the producer to the consumers. It has to implement the marketing strategies, promotions and campaigns. Finally, it must evaluate the effectiveness of each part of marketing mix and introduce vital modifications to remove discrepancies in the actual execution of plans, policies, strategies, procedures and programs. The survival and growth of any business depends upon the profitability, when marketing management becomes a good practitioner of the marketing concept. Thus, Marketing Management is an ongoing process dynamic marketing environment. It is the analysis, planning, implementation, and control of programs designed to creates build and maintain beneficial exchanges with target buyers for the purpose of achieving organizational objectives. Thus, Marketing Management involves managing demand which in turn involves managing customer’s relationship. 1.2 IMPORTANTANCE OF THE SUBJECT: After a brief introduction of the subject, it can be said that marketing is an ongoing process, comprising of:  Discovering and translating consumer needs and desires into products.  Creating demands for the products and services through promotion and pricing.  Serving the consumer demand through planned physical distribution.  Expanding the market even in the face of keen competition. Thus, the given important aspects of “Marketing Management” are important tool for all its major functioning. Without it the process of marketing is not possible and it does not lead to efficient management in the company. Thus for a company it is very vital to efficiently use all its resources in meeting the demands of the consumers and also earning a high profit turnover. 1
  6. 6. 1.3: REASONS FOR SELECTING THE TOPIC: The following are the reasons as to why, the given topic namely “Distribution Channel” was chosen by me. 1. To know the types of distribution channels in the organization. 2. To know the functioning of the various distribution channels 3. To know that how they act as intermediary between the producer and the consumers. 4. To know that whether they are able to supply the goods to the consumers’ in time or not. 1.4: REASONS FOR SELECTING THE COMPANY: The following are the reasons as to why J.k Tyres Ltd was Chosen by me. 1. The company is a well known one and has goodwill in the national and international market also. 2. To know about the operation and distribution pattern of J.K Tyres in North East. 3. To know the market share of J.K. Tyres in Northern Market. Thus, these were the reasons for selecting the company to carry out the project. 2
  7. 7. 2. COMPANY PROFILE 2.1: INTRODUCTION TO THE ORGANIZATION: J.K organization owes its name to late Juggilal Singhania, a dynamic perrsonality with a broad vision. Inspoerd by the cause of the Swadeshi movement of Mathama Gandhi, and driven by the zeal to set up an Indian enterprise, Lala Kamlatath Singhania Founded J.K Organization in the 19th century ushering in a new industrial era in India. The process of Industrialzation and diversification was worthily and successfully carried on by Lala Kamlapath and three illustrious sons-sir padampat, Lala Kailashpat and lala lakshmipat, aided in no small measure by the late Gopal Krishna son of Sir Padampat. The advent of JK Organization on the industrial landscape of India almost synchronizes with the beginning of an era of industrial awareness - an endeavor for self reliance and the setting up of a dynamic Indian industry. This was way back in the middle of the 19th century. And the rest that followed is history. 2.2: CORE VALUES OF THE ORGNIZATION: JK Organization has been a forerunner in the economic and social advancement of India. It always aimed at creating job opportunities for a multitude of countrymen and to provide high quality products. It has striven to make India self reliant by pioneering the production of a number of industrial and consumer products, by adopting the latest technology as well as developing its own know-how. It has also undertaken industrial ventures in several other countries. JK Organization is an association of industrial and commercial companies and charitable trusts. Its member companies, employing nearly 50,000 persons are engaged in the manufacture of a variety of products and in diverse fields of commerce. Trusts are devoted to promoting industrial, technical and medical research, education, religious values and providing better living and recreational facilities. With the spirit of social consciousness uppermost in mind, J.K. Organization is committed to the cause of human advancement. 3
  8. 8. 2.3: INTRODUCTION TO THE COMPANY:J.K Tyre & Industries Ltd is the flagshipcompany under the umbrella of J.K organization.It has been established in 1977 by late Jugilal and Kamlapath Singhania. Jk Tyre and Industries is a mega corporate entity that is emblematic of excellence, diversification and pioneering new technologies. A part of JK Organization which ranks among the top private groups private groups in India, J.k Tyre and Industries is committed to self reliance and follows an ethic that views customer satisfaction as an index of achievement. Over the years, the company has expanded and diversified its business portfolio. It has developed into a multi product, multi-location corporate entity comprising of number of business divisions. 2.4: GENERAL INFORMATION: Ever since its inception it has been JK Tyre's belief in the value of technological superiority that has made it grow by leaps and bounds. This division produces and sells tyres and tubes under the brand name "JK Tyre" for Truck, Buses, Passenger Cars, Jeeps, Light Commercial Vehicles, Multi Utility Vehicles and Tractors. The company pioneered Steel Radial Technology in India in 1977 and continues to be the industry leader in the Radial segment in India. JK Tyre is the only Tyre Manufacturer in the country to produce high performance 'T' & 'H' -rated steel radial tyres. JK Tyre has consciously followed a policy of continuously modernizing and expanding its tyre manufacturing facilities to retain its edge in the market place. Our customer base covers virtually the entire Original Equipment Manufacturers (OEMs) in India together with Replacement Market for four wheeler vehicles, Defense and State Transport Units. Besides India, we have a worldwide customer base in over 45 countries across all 6 continents. To keep pace with the market demand as well as technological leadership in Indian market, J.K. Industries acquired Vibrant Tyres Limited, Mysore in 1997. J.K. Industries and Vibrant 4
  9. 9. Tyres Limited are the only tyre companies in India to have received all three ISO 9001, QS 9000 and ISO 14001 certificates. This indeed is a true reflection of our commitment to system oriented approach. The company has a technical collaboration with M/s Continental AG, Germany, which is among the top five tyre manufacturers in the world to keep pace with latest technological developments. To stay at the forefront of technological advancements a state of art Research & Development Centre, HASETRI, was set up, which remains the nerve centre for providing cutting edge technology. In a short span of time it has emerged as the 17th largest tyre manufacturer in the world an achievement in itself. JK Tyre is a leading radial manufacturer and the first in the world to be awarded the OS 9000 for multi- location operation. It is also the first tyre manufacturer in the world to get the ISO 9001 certification for its entire operation. JK Tyre has consciously followed a policy of continuously modernizing its tyre manufacturing facilities to retain its edge in the market place. Also, JK Tyre is the largest exported tyre brand from India. It was awarded the CAPEXIL’s Highest Exported award for 1997-98 by FIEO. It enjoys prefer premium brand status in truck Bias market in USA and across many markets in Africa, Middle East and South East Asia. Ever since its inception it has been JK Tyre's belief in the value of technological superiority that has made it grow by leaps and bounds. This division produces and sells tyres and tubes under the brand name "JK Tyre" for Truck, Buses, Passenger Cars, Jeeps, Light Commercial Vehicles, Multi Utility Vehicles and Tractors. The company pioneered Steel Radial Technology in India in 1977 and continues to be the industry leader in the Radial segment in India. JK Tyre is the only Tyre Manufacturer in the country to produce high performance 'T' & 'H' -rated steel radial tyres. JK Tyre has consciously followed a policy of continuously modernizing and expanding its tyre manufacturing facilities to retain its edge in the marketplace. 5
  10. 10. Our customer base covers virtually the entire Original Equipment Manufacturers (OEMs) in India together with Replacement Market for four wheeler vehicles, Defence and State Transport Units. Besides India, we have a worldwide customer base in over 45 countries across all 6 continents. To keep pace with the market demand as well as technological leadership in Indian market, J.K. Industries acquired Vikrant Tyres Limited, Mysore in 1997. J.K. Industries and Vikrant Tyres Limited are the only tyre companies in India to have received all three ISO 9001, QS 9000 and ISO 14001 certificates. This indeed is a true reflection of our commitment to system oriented approach. The company has a technical collaboration with M/s Continental AG, Germany, which is among the top five tyre manufacturers in the world to keep pace with latest technological developments. To stay at the forefront of technological advancements a state of art Research & Development Centre, HASETRI, was set up, which remains the nerve centre for providing cutting edge technology. In a short span of time it has emerged as the 17th largest tyre manufacturer in the world an achievement in itself. 2.4Their plants: With three plants located in Rajasthan, Madhya Pradesh and Karnataka, JK Tyre is the largest manufacturer of truck and bus tyres in India. The truck and bus tyres produced account for nearly 74% of the total tyre business in India, thus giving JK Tyre an undisputed position. Additionally, JK Tyre is the only manufacturer of truck/ bus steel radial tyres, and the second largest manufacturer of 4-wheeler tyres in the country. Also, JK Tyre is the largest exported tyre brand from India. It was awarded the CAPEXIL's Highest Export Award for 1997-97 by FIEO. It enjoys preferred premium brand status in Truck Bias market in USA and across many markets in Africa, Middle East and South. 6
  11. 11. 2.7 JK TYRE VISION AND MISSION: JK TYRE VISION: JK TYRE MISSION: 7
  12. 12. 2.8 ORGANISATIONAL CHART ORGANISATIONAL CHART OF JK TYRE INDUSTRIES, GUWAHATI : 8 Area Manager Service Engineer Sales Officer (1) Sales Officer (1) Sales Officer (1)) Sales Officer (1) Sales Officer (1) (Commercial Staff)
  13. 13. 3. HISTORY OF TYRES 3.1 THE HISTORY OF THE TYRE: The following chronicles the development of the tyre as we know it today. RW Thomson invented and patented the Pneumatic Tyre in 1845. His first design used a number of thin inflated tubes inside a leather cover (illustrated). This design actually had its advantages over later designs. It would take more than one puncture to deflate the whole tyre, and varying the pressures could alter the ride conditions. It was not until the late nineteenth century, 1888, that John Boyd Dunlop invented the Rubber Pneumatic Tyre. Despite these technological breakthroughs the solid rubber tyre continued to be the dominant tyre and it was not until 1889 that the pneumatic tyre caught on. Dunlop first advertised his tyres in December 1888 in the Irish Cyclist, and in May of the following year the Tyre had its first breakthrough. A Belfast Cycle Race was won on pneumatic rubber tyres, and by now the public were starting to take note. Unfortunately the original tyre had its drawbacks. The inner tube was difficult to get at because the tyre was stuck to the wheel. In 1890 CK Welsh patented the design of a wheel rim and outer cover with inextensible lip. By now we had the basics for today’s tyre. Over the years the tyre has developed into today’s high technology offerings. Two of the most important technical developments include Michelin’s creation of the radial tyre with its vastly superior grip in 1948, and when Dunlop did away with the inner tube on car tyres in 1972. Time has given the motor industry tyres capable of many different applications. This ranges from High Speed Racing such as Formula One to Heavy Plant Usage on vehicles as large as a house. All tyres deliver a comfortable ride, relative puncture resistance, wear and performance. The importance of a tyre must not be taken for granted. After all a tyre is your vehicles only point of contact with the road. 9
  14. 14. 3.2 TYRE TECHNOLOGY: RUN FLAT TYRE: Several Tyre Manufacturers have developed tyres, and tyre systems that allow a vehicle to continue moving despite a loss of pressure. There are two different approaches: 1. Reinforce tyre sidewall manufacturer of thi8s include: Bridgestone, Continental, Goodyear, Dunlop, and Pirelli. 2. Rubber clip to your rim manufacturers of this include Michelin. All Run flat technology must operate in tandem with tyre pressure warning systems. 1. Reinforced Tyre Sidewall: The Diagram below shows The Dunlop DSST system for run flat. These tyres can be placed on any rim. The sidewall is reinforced allowing the tyre to support the vehicles weight. The tyre is constructed with new rubber compounds that prevent tyre destruction with excessive flexing. Run Flat Tyres allow a vehicle with complete loss of tyre pressure to handle effectively. Braking, acceleration, and steering behaviour remain unchanged. Mobility is maintained even after a puncture, but you must refer to each individual tyre’s guidelines from the Manufacturer. Dunlop DSST Tyre Tyres that carry this technology include the Bridgestone RFT series, Continental SSR series Dunlop DSST series, Goodyear ROF series, and the Pirelli Euphori@ series. 2. Rubber Clip to your tyre rim:
  15. 15. The rubber clip prevents the tyre rim cutting into your tyre when you experience a loss of pressure. This system has been developed by Michelin and is known as the PAX System. Like the reinforced sidewall it operates in tandem with automated tyre pressure monitors. Why fill my tyres with Nitrogen? Why would you want to do this? The benefits of Nitrogen filling are as follows:  Improved comfort of ride  Improved safety  Increased fuel savings  Improved life of tyre Nitrogen has long been the accepted gas medium for filling aircraft tyres, racing tyres and heavy mining and construction vehicle tyres. Nitrogen is used for safety reasons and to ensure that tyres are always at a constant pressure. Compressed air, the traditional medium for inflating car tyres, contains both oxygen (21%) and nitrogen (78%). The rubber tyre is like a membrane, through which oxygen permeates three times faster than the nitrogen. The result is that the oxygen slowly leaks out through the rubber walls, and the under - inflation leads to higher tyre wear with a consequent decrease in safety and comfort, and higher fuel costs.
  16. 16. Truck & Bus: Bridgestone is one of the first tyre manufacturers to prepare itself for the latest demands in the Truck & Bus industry with the latest technology. We are proud to present our brand new state-of -the-art BSelect Tyre Centre & SA State Office located at Wingfield, SA. This Tyre Centre is Bridgestone Australia's largest Truck & Bus Service Centre. With 8 truck bays, having B-Triple capabilities, servicing any vehicle configuration is not an issue. A truck driver's lounge with shower facilities also allows you to get that necessary break & opportunity to freshen up whilst we carry out the work on your vehicle. Also the service centre has 3 passenger car bays and 1 passenger car wheel alignment bay with a separate entrance to round out all servicing needs. New Truck & Bus Tyres: Bridgestone strongly supports the modern transport operator with cost -efficient, hi-tech solutions to the increasing demands of road transport not only today but in the future. Refer to Truck Tyre specifications for details. Featured Tyre: Introducing the new Bridgestone R150II As part of Bridgestone's philosophy of continuous improvement Australia’s most popular line-haul steer tyre, the R150, has been revised for improved performance. Building on the ground breaking performance and market leading popularity of the R150 (see results of Bridgestone's 2004 TBR in the brochure) the R150 II delivers greater mileage and superior irregular wear resistance. R150II Specifications Brochure R150 Specifications Brochure Bridgestone Select Truck Centre Wingfield S.A.
  17. 17. 4.DISTRIBUTION DEPARTMENT OF THE COMPANY 4.1: General Introduction to the department: Placing of goods and services where they are needed and when they are wanted is very important function of the distribution department of the company. The distribution department of the company has to perform all the functions related to the distribution of their products i.e tyres and how toto serve their customers in the best possible ways. The distribution department of the company focusses on the customers needs and tries its level best to provide services to the customers as early as possible. The distribution department of the company consists of Didtrict manager, sub-district managers,service engineers for different segments of tyres, and operational staffs. They all work together and in coordination to satisfy their dealers and provide them with best service. 4.2 Functions of the Department: 1. Match assortments and quantities of goods designed by customers with these available for distribution. 2. Promote the products they carry through catalogues trade shows and advertising. 3. Conduct research on markets to locate and determine the requirement of potential customers. 4. Sell the products through personal presentation 5. Physically distribute the product through sorting and transporting it. 6. Serve products and advice on their use as required. 4.3 Organizational set up. DISTRICT MANAGER SUB DISTRICT MANAGER SERVICE ENGINEER Operational Staff (8-10) 13
  18. 18. 4.4 Pictures of their C&F 14
  19. 19. 5. TOPIC THEORY 5.1 INTRODUCTION: The typical geographic separation of the manufacturer or producer from the ultimate consumer requires some means for bridging the gap. The movement of goods and services from the place of production through middlemen to the ultimate consumers/users has been thought of as a channelized flow. At present most of the producers sell their products to the consumer through a host of marketing intermediaries performing a variety of functions-buy, take title to, resell, negotiate etc. producers produce the products and finally make them ready for the market. The methods and routes to be adopted to bring the products to the market-to the ultimate and industrial users must be determined. This involves establishing distribution strategies, including channel of distribution and physical handling and distribution. Distribution decisions have a broad impact on the marketing program of a firm. The object of the distribution strategy is to the right customer. A product cannot reach its target marketer if its distribution is not planned and carried out carefully. Distribution channel decisions which to most critical decisions which intimately affect all the other marketing function. Distribution system had two components: (i) channels of distribution and (ii) physical distribution. Channel of distribution. By channel of distribution we mean the intermediaries or the consumers, including transportation, warehousing and inventory management. In simple terms “Marketing Channel” or “channel of distribution” is a path traced in the direct or indirect transfer of ownership to a product, as it moves from a producer to ultimate consumer/industrial users. Definitions: 1. In the words of Stern and El. Ansary “Marketing channels are sets of interdependent organizations involved in the process of making a product or service available for use or consumption. 2. According to Rachman, “Marketing channels are the path that products follow on their way from producers to the consumers or industrial users”. 3. In the words of William Stanton, “a channel of distribution for a product is the route taken by the title to the product as it moves from the producer to the ultimate consumer or industrial user”. 15
  20. 20. 5.2 Characteristics: 1. A distribution channel requires at minimum a seller and a buyer. The buyer may be a consumer or and industrial user. 2. It includes besides buyers and sellers, various middlemen. 3. The basic transaction in a distribution channel is the exchange of ownership, or title of goods. Middlemen play an active role in the transfer of ownership. 4. The channel for a product extends only to the last person who buys it without making any significant change in its form. When its form is altered and another product emerges, a new channel is started (William Stanton). 5. One of the objectives of distribution channel is to create “transactional efficiency”. 5.3 Role and Importance: A channel of distribution plays an important role in the marketing of goods and services because the ultimate goal of all marketing activities is to effectuate the transfer of ownership of goods to customers. The importance of distribution channel can be explained under the following headings: 1. Creation of time and place utility: The value utility of a product is created by production activities, but time and place utilities are created by distribution channels. 2. Innovative product: The new product offered at an attractive price would be of no use unless there is an efficient distribution system. 3. Easy searching: In marketing, both seller and buyer look for each other to make a transaction. Distribution channels greatly facilitate this search process by bringing both parties at one point. 4. Smooth flow of goods: Distribution channels also smooth out the flow of products by creating possession, time and place utilities. 5. Bridges the gap: Employing distribution channel bridges the discrepancy between the assortment of goods offered and the one demanded by consumers. 16
  21. 21. 5.4 Functions of distribution channel: The distribution channel performs the following function: 1. Market information: Channels of distribution can play a vital role in marketing research. They can collect and disseminate various market information about potential and current customer’s competitors and other forces operating in market. 2. Promotion: Middlemen sometimes motivate and train retailer’s sales staff. Retailers undertake local advertising and special demonstration to promote product. 3. Customer service: channel personnel provide advice on new and existing products. They help in test marketing and also help in proper positioning of products against competitors and suggesting which products to remove from the market. 4. Pricing: Middlemen often have a strong say in pricing decisions. They stipulate their required market ups, trade discounts and off-season discounts. 5. Distribution: Channel members assist in distribution activities such as transporting, warehouse, and customer contact and inventory and stores management. Distribution channel also perform several other important functions such as, it helps ion Production Planning, making pricing decisions, negotiation, sorting, assorting, financing, physical possession of goods, risk taking and also in the introduction of new products. 5.5 Types or classification of Distribution channel: A producer has to find out the most economical form of distribution. There are a number of different channels open to the marketer. These can be grouped under two major headings: 1. Direct selling by manufacturers (or direct channel): In the most direct channel are no intermediaries between the producer and the final consumers, not through middlemen. Direct channels are most common in industrial marketing. Industrial components, heavy equipment, machinery installation are generally sold on a direct basis. Direct channels are also undertaken in the case of agriculture. Bata Ltd, calica mills, Raymond’s, DCM, Eureka Forbes Ltd are some of the concerns employing direct channels in India. 17
  22. 22. A company can adopt the following means for direct selling.  Own Retail shops  Personal selling door-to-selling)  Mail order selling  Franchised shops  Telephone selling (telemarketing) 2. Indirect Selling through Middlemen (or Industrial Channels): Indirect selling can be performed through two types of outlets: (a)Merchandise agents and brokers (b) Merchant wholesalers (a) Merchant agents and Brokers: Producer may entrust the selling job to someone else. Like selling agents, brokers, commission merchants etc. These are independent businessmen who work on a commission basis. They do not own title to the products they sell, although they may physically handle them. These facilitate selling functions by bring and sellers together. (b) Merchant wholesalers or trade channels: These are the firms we usually refer to as wholesalers. Jobbers or distributors. They typically are independent owners and they take title to the products they handle. They firm the largest single segment of whole selling firms. If a producer chooses to use this trade channel, he has a choice of following channels: 1. Producer Retailer Consumer 2. Producer Wholesaler Retailer Consumer 3. Producer Wholesaler Semi-wholesaler Retailer Consumer 4. Producer Agent Retailer Consumer 5. Producer Agent Wholesaler Retailer Consumer 6. Producer Wholesaler Consumer 18
  23. 23. These are shown in the figure given below: Manufacturers/Producers Agents/brokers Fig: Distribution Channels 5.6 Types of Intermediaries: As mentioned earlier, there are served types of marketing intermediaries. They are: 1. Sole-selling agent 2. Marketer 3. C&F agents (CFA’s) 4. Redistribution stockiest 5. Stockiest/distribution/wholesaler 6. Semi-wholesalers 7. Retailer /dealer 8. Broker 9. Franchises 10. Authorized representation 11. Commission agents 12. Jobbers 19 Wholesalers/distribution Retailers Retailers Consumers and organizational end-users
  24. 24. Sole-Selling Agent: When a manufacturing prefers to stay out of the marketing and distribution task, he appoints a suitable agency as his sole-selling agent/marketer and entrusts the marketing job with him. A “sole-selling agent” or a “marketer” is usually a large marketing intermediary with large resource and extensive territory of operation large resource and have one or more marketers: but when he opts for a sole-selling agent, he appoints just one agency as the sole-selling agent. C&F Agents (CFA’s): In many cases manufacturers employ carrying and forwarding agents’ often referred to as C&F agents or CFA’s. The CFA’s be described as special category wholesalers. They supply stock on behalf o the manufacturer or the wholesale sector or the retail sector. Their function is distribution. Their distinguishing characteristic is that they do not resell products but act as the agent/representative of the manufacturer. They act on behalf of the manufacturer and as his extended arm. In essence, they are manufacturer branches. Wholesalers/Stockiest/Distributor: A ‘wholesaler’ or ‘stockiest’ or ‘Distributor’ is also a large operator but not on a level comparable with a marketer or sole selling agent, in size, resources, and territory of operation. The wholesaler/ stockiest/ distributor operates under the marketer-sole selling agent, Where such an arrangement is used by the manufacturer. Semi-Wholesalers: Semi-Wholesalers are intermediaries who buy products both from producers or wholesalers in bulk, break the bulk and resell the goods (mostly) to retailers in assortments needed by them. Like the wholesalers, semi-wholesalers too perform the various wholesaling process. In some cases, they may also perform the retailing functions. Retailer/ Dealer: Retailers sell to the household/ ultimate consumers. They are at the bottom of the distribution hierchy, working under wholesalers/ Stockiest/distributors/ semi-wholesalers as the case may be. In case where the company operates a single-tier distribution system, they operate directly under the company. They are also sometimes referred to as dealers or authorized representatives. 20
  25. 25. 5.7 Types of channel levels in distribution channel The producer and the final customer are part of every channel. The length of a channel is designated through the length of a channel. A distribution channel can have any number of levels. Some of which are described below: a) 0-level channel: A zero-level channel is also called marketing channel. It consists of a manufacturer selling directly to the final customer. The major examples are door-to- door sales (eureka Forbes), home parties (Tupperware), mail order (Otto Burlington), telemarketing (ICICI Banks cards), T.V selling (Amazon, India times), and manufacturer-owned stores (Bata, Indian oil, Bharat petroleum petrol pumps). b) One-Level channel: A one-level channel contains one selling intermediary. These intermediaries may be retailers or distributors. This is the most common channel in case of consumers durable such as textiles, shoes, readymade garments, and so on. In case of textiles most of the mills have their retail outlets throughout length and breadth of the company. c) Two-level channel: A two-level channel contains two intermediaries. In consumer markets, these are typically a wholesaler and a retailer. The companies producing consumer non-durable items use this where the wholesaler stock the production in different parts of the nation or a region and from there, the products are supplied n smaller quantities to the retailers and who in turn sell to the consumers. d) Three-level channel: A three-level channel contains three intermediaries. For e.g. in meatpacking industry wholesalers sell to jobbers, who generally are not served by large wholesales. Distribution channel with even more levels exist. Typical private food distribution systems may have five to six levels consisting of itinerant merchants, commission agents, wholesalers, semi-wholesalers, and retailers. As the number of levels increase, the level of difficulty of information sharing and coordination also increases. However, the cost of a channel system is not necessarily proportional to its length/levels. 21
  26. 26. 0-level 1-level 2-level 3-level Fig: Consumer marketing channel MANUFACTURER WHOLESALER JOBBER RETAILER MANUFACTURE R 0-level 1-level 2-level 3-level Ma nufa cture r’s representa tive Industrial distributor DISTRIBUTORS Fig: Industrial Marketing channels 22 MANUFACTURER CONSUMER MANUFACTURER WHOLESALER RETAILER CONSUMER RETAILER CONSUMER CONSUMER MANUFACTURER MANUFACTURER MANUFACTURER MANUFACTURER Ma nufa cture r’s representa tive Industrial customers Industrial customers Industrial customers Industrial customers
  27. 27. A. Number of contacts without a Distribution 1 2 3 4 5 6 7 8 9 Customers Manufacturer X Customers =3x3=9 Manufacturer =Customer =3=3=6 23 Manufacturer Manufacturer Manufacturer Customers Customers Manufacturer Manufacturer Manufacturer Customers Distributor Customers Customers
  28. 28. 5.8 Factors governing the choice of distribution: The factors governing a choice of distribution channel can be grouped into four segments as product, market, and institutional unit and environmental. The product factors are: physical nature, technical nature, the length of product line, the market position. The market factors: the existing market structure, the nature of the purchase deliberating availability of the channel, members the post service ability. The unit factors are: the companies’ reputation, the company marketing policies. The environmental factors are: economic factors, the legal restrictions and fiscal policies. 5.9 Factors governing the choice of an Intermediary: The major factors governing the choice of an intermediary are: (1) the market served, (2) the market reputation, (3) Continued existence,(4) The Specialization in selling, (5) the sales policies, (6) the nature of sales organization, (7) the financial position, (8) The facilitate available. 5.10 The channel policies and Strategies: The channel policies and strategies can be classified into two categories as distribution intensity based and others. The distribution intensely based policies and strategies are: (1) intensive distribution policy, (2) Selective distribution policy, (3) Exclusive distribution policy. On the other hand other policy options are: (3) the policy of full-line forcing, (4) the policy of reciprocity, (5) Dual and multiple distribution policy (6) the policy regarding conditions of transactions. 24
  29. 29. 5.11 Other dimensions of channel management: 1. Channel Compensation: channel Compensation deals with the financial and non-financial compensation payable to the channel members. There should be clear understanding about the same between, the parties. The basis of payment shall be extended of functions performed. The forms of compensation may be commission of discount. 2. Channel motivation: channel motivation stands for the encouragement given to the channel members to increase the sales and profits and reputation of the concern of the channel commander. Though there are many ways of motivating the channel members to better performance, the best form of incentives can be profit margins, commissions, discounts and exclusive franchise. 3. Coordinating: channel coordination stands for the integration of channel operations with those of channel commander so that all the3 activities directed at the market are funneled for the maximum market impact. In other words, the conflict that arises is to be killed at any rate. The causes of conflict are three: (i) the strong desires at high level to cover fixed costs. (ii) By passing the intermediaries though such by phases is not allowed and (iii) Different interpretation regarding role of intermediaries under different status and financial conditions. The effects of conflict are disastrous. It kills the cooperative spirit, faith, and trust. The effects of are disastrous. It kills the cooperative spirit, faith, and trust. The firms respond to such channel conflict is one of the ways; these ways are withdrawal repression internal changes_ use of power. The conflict management strategies are: (1) bargain strategy (2) boundary strategy (3) penetration strategy, (4) supra organization strategy. 4. Channel Control: channel control implies a course of planned efforts of channel commander to ensure that the channel intermediaries behave with him, his consumers and other channel member in the manner desired by him. The measures of control are : use of power bases after deciding the nature and extend of control needed. These power bases are reward-coercive-expert- identification and legitimacy. 25
  30. 30. 6. Distribution Channel of J.K Tyres Ltd 6.1. Distribution Patter of J.K Tyres: As per the study conducted, it was found that J.k Tyres in Guwahati is a C&F (carrying and Forwarding agent) . a carrying and forwarding agent can be described as a special category wholesaler. The supply stock on behalf of their manufacturer to the dealers and through them directly to the manufacturer. The C&F in Guwahati , is the main C&F in the entire North-East. And their other C&F’s in North-East are Shillong, Agartala,and Jorhat. J.K Manufacturer C&F’s Dealers Customers Fig: Distribution channel of J.K tyres In addition to supply through C&F’s. J.K Tyres is also engaged in direct selling. They are engaged in direct selling through O.E fitment with Ashok Leyland, Swaraj Mazda, Tata, Maruti, Wagon R, Alto etc J.K Manufacturer use 2-level channel, which consists of manufacturer, godown, dealer, and customer. Manufacturer C&F’S Retailer Consumer 26
  31. 31. These channels are selected on the basis of market to be captured. They are able to capture the market very efficiently and distributed to different regions/areas through their dealers. Their tyres are nearly exported ton80 countries. And they market the products on order, i.e. on the basis of order received. And the C&F located in Guwahati distributes the tyres to the entire North-East region. 6.2 MAP SHOWING J.K TYRE’s OPERATION IN INDIA IN INDIA 27
  32. 32. 6.3 THEIR OPERATION IN NORTH-EAST INDIA: 28
  33. 33. 7. Research Methodology 7.1: Research Objectives: As a management student, it has been thought to is that the systematic process of any work is done through setting the objectives. Without framing or setting the objectives and prioritization the assigned job, many come out with unhappy results. Apart from this, one proceed to do any assignments or project works, if the objectives are not set and given due importance. Keeping in mind that, with the definite objectives of the work, the works are completed in a clear cut way. I have framed some objectives to study the “distribution Channel” of “J.K tyres Ltd” which are as follows: 1. To know about the type of distribution channel they use. 2. To know about the functioning of the various distribution channels 3. To know their procedure of working 4. To know that5 how they help in bringing the producers and the consumers together 5. To know that whether they are able to maintain a good relation with customers 6. To know the problems that they face while distribution the products Thus, the objectives so set up for the given topic were helpful in carrying out the project work successfully. Without the setting of objectives, systematized manner 7.2 Research Methodology: There are various methods available for collecting the information. The methodology used in conducting this was:  Questionnaires  Observations  Interview Basically, there are two types of data methods: Primary and Secondary. My information’s are collected from both the sources (primary and secondary).  Primary Data: The primary source includes: 1.Questionnaire: In this method a set f questions are prepared with a view to collect the requisite information. For using this method, I first made the questionnaire, get it typed in the computer and 29
  34. 34. then obtained the printed questionnaires were then given to the respondents to fill it.Questionnaire can be classified into four main types: a) Structured- non- disguised b) Structured-disguised c) Non structured-non-disguised and d) Non-structured-disguised Another important aspect in the questionnaire method is the type questionnaire methods is the type of questions used. Questions can be classified into:  Open-ended questions and  Close-ended questions In collecting the information about my project I used. Structured-non-disguised questionnaires and the type of questions which I used in the questionnaire are mostly close-ended questions. All the close-ended are multiple choices and the type of open-ended questions is completely unstructured. 2. Direct interviewing: oral interviewing (whether formal or informal) is one of the best ways to collect the information. Most part of my information’s are collected with the respondents 3. Simple observation: observation is another important technique of collecting the information. Some of my in formations are gathered from simple observations. Some things are easily observable but some are not. Whether things I have observed are added to my information collected.  Secondary data: secondary data are those data which have been gathered earlier for some other purpose. The primary data collected by one person may become the secondary for another. For my study, I made use of these secondary sources too. The data I gathered through these secondary sources are the company profile, area detail, company’s goals and objectives etc. 30
  35. 35. Design of Research 31 Primary data Secondary data Sources of data i. Questionnaire ii. Observation Data needed are founded I. Company II. Internet Data analysis By graphs, histograms, pictures Period of time
  36. 36. 8. Methods of data collection 8.1 Introduction: In every aspect of the project which is designed on the basis of some observation or research, is made with adopting particular methods and techniques, while doing any research or project work, every information should be unbiased and not prejudiced, based on truth and veracity .in J.K Tyres Ltd (company study was done systematically and thoroughly on the company’s distribution department companied dealers in relation to the topic, which is conducted at the company and design a data collected source of data information. 8.2: Methods of data collection: Both primary and secondary sources are used for data collection 1. Questionnaire method 2. Discussion with the guide 3. Companies document 4. Sampling techniques : for this study I selected random sampling method  Random sampling method: a random sampling technique is one in which sampling units are selected by chance for which there is known, non-zero probability of selection.  Sample size: after determining the sampling methods, the next step to be taken care of is to take an important decision regarding the sample size or adopting a technique about the size or the sample. Number of employees at J.K Tyres Ltd: 15 Number of persons/employees evaluated:7
  37. 37. 32 9. Data Analysis and Interpretation After the conduction of the project work through various methods, the important aspects as regards to the topic were found out. All necessary details are described one by one below: A. Findings from observing the C&F and interviewing the managers: 1.Role of distribution channel: A channel of distribution plays as important role in the making of goods and services because the ultimate goal of all marketing activities is to effectuate the transfer of ownership of goods to customers. And in this regard, it was found that; distribution channel plays a vital role in product distribution. It serves the very basis of all the essential functions that are needed to deliver the product to the final consumer/user. 2.Type of distribution: A producer has to find out the most economical form of distribution. There are a number of different channels open to the marketer; which are grouped under two major categories, namely direct and indirect selling. And as per the findings, J.K Tyres in Guwahati is a C&F (carrying and forwarding agent). A carrying and forwarding agent can be described as a special category of wholesalery. They supply stock on behalf of their manufacturer to the dealers and through them directly to the customers. They act as agent/ representative of the manufacturer. The C&F in Guwahati is the main C&F in the entire North-east. And the other C&F’S are in Shillong, Agartala, Jorhat. J.K Manufacturer C&F’s Dealers Customers Fig: Distribution channel of J.K Tyres
  38. 38. In addition to supply through C&F’S. J.K Tyres is also engaged in direct selling. They are engaged in direct selling through O.E fitment with Ashok Leyland, Swaraj Mazda, Tata, Maruti, Wagon R, Alto etc 3. Channel Level: The producer and the final customers are part of every channel. The length of a channel is designed through the length of a channel. A distribution channel can have any number of levels which many varies between 0-6. And, as per the study conducted it was found that J.K Manufacturer use 2-level channel, which consists of manufacturer, godown, dealer, and customer. Manufacturer C&F’S Retailer Consumer 4. Basis for selecting distribution Channel: The channels are selected on the basis of market area to be captured. They are able to capture the market very efficiently and products are efficiently distributed through their dealers. Their tyres are nearly exported ton80 countries. And they market the products on order, i.e. on the basis of order received. And the C&F located in Guwahati distributes the tyres to the entire North-East region. 5. Product Distribution: J.K Tyres are distributed nationally as well as internationally. J.K Tyres are nearly exported to 80 countries. And they market the products on the basis of order received. And the C&F located in Guwahati distributes the Tyres to the Entire North-East region. 6. Relation with international; customers: In this regards, it was observed that, J.K Tyres maintain good relation with its customers. From the survey conducted, it can be conducted that J.K tyres maintain a good relation with its dealers; and good relation with its dealers; and there is no conflict between them. 7. Channel strategy: Designing appropriate channel strategy is very important aspect in distribution. And J.K tyre sales design appropriate channel strategy for their distribution. For effective functioning, they rain and motivate their international to perform efficiently. They also provide them with attractive scheme all throughout the years, which act as motivation for them. And, for the customers, they replace, the tyre if a manufacturing defect is found.
  39. 39. 8. Types of Market: J.K Tyres markets, it product through: a. O.E- Fitment ( Original Equipment Fitment): In O.E Fitment , J.K Tyres has tie-up with Ashok Leyland, Swaraj Mazda, Tata, Maruti, Wagon R, Alto etc b. For Government orders: One of their important markets is order from government. They sometimes receive orders from government for, State Transport service like DTC etc. at present; they have an order of tyres for I-bus for common wealth games. c. Replacement Market: This is the most important and maximum revenue market for the organization. Replacement market means, the market for replaceable tyres, as the tyres have a definite life span, they need to be replaced after that period of time and in turn creates the most important market for them. pie showing the percentage of the differntn type of markets O.e Fitment market 25% Govt orders 19% Replacemant market 56%
  40. 40. B. Findings from surveying the Market and interviewing the dealers: 1. Are the dealers satisfied with the Distribution channel provided to them?  Sample Size-5 Highly Satisfied-1 Satisfied-3 Dissatisfied-1 Highly Dissatisfied-0 pie showing the satisfactory level of dealers in context to distribution channel 0% 20% 2. Do they apply any terms & conditions for Distribution: Sample size-5 Yes-0 No-5 In this regard it was found that J.K Tyres does not apply and terms and condition to the dealers for distribution. 3. Is, there any conflict arises between you and your distributor? Sample size-5 20% 60% Highly stisfied Satisfied Dissatisfied Highly disstisfied
  41. 41. No – 5 Yes - 0 According to the study conducted it was found that, there is no conflict between the dealers and distributors. They have good relation between them, and the distribution department of J.K tyres also keeps consideration that the dealers are satisfied in all possible ways. 4. Their Operation in North-East: The Company started its operation in North-East India in 1977. It has regional set-up in Guwahati, Shillong, Dimapur, Agartala which are operated by C and F agent. According to the company, the total market potential of North-East for various tyre segment are as follows. Truck radial 17312 (approx) LCV 6060 (approx) Radial 11000 (approx) Passenger Bias Tyre 2250 (approx) truck radial, 17312 Passenger Bias tyre, Radial , 11000 2250 LCV, 6060
  42. 42. 4. Average Monthly sales (in units): Truck Radial : 3000 L C V Tyre : 1474 Radial : 5850 Passenger Bias Tyre : 800 Truck Radial 27% LCV Tyre 13% Radial 53% Pessenger Bias Tyre 7% pie showing Average Monthly Sales in Units
  43. 43. 9. Limitations
  44. 44. Despite of the meritorious conduct of the project, certain hindrances occupied some places in my work. Even though I tried with my heart and soul to put my best effort in the work, yet I could not escape from the limitations that surrounded me. The following are the limitations that surrounded me. The following are the various obstacles that hampered me during the course of my project: 1) The Managers were too busy with their work 2) It was difficult to seek appointment on a particular day and time; we had to reach the place at anytime, whenever the manager finds time free time for our training. 3) The Distance of the office from the Godown was very much, s o we had to face difficulty in reaching there. The following limitations so prevailed were only constrains that were hampering me in the preparation of project. But the best efforts that I could put in my work was to some extent relived of the other limitations that could have been occurred. 10: Suggestions
  45. 45. After the competition of the various references of the project, various circumstances in contrast to the project were observed under the given circumstances: 1) It should try to locate its office premise near the godown for easy and fast delivery of the products i.e. tyres 2) It should also try to maintain separate godown for different varieties of tyres. If not for all, then at least for the major varieties of tyres.
  46. 46. Conclusion It constitutes the last part of the project work done. And this project work has been made on the ‘Distribution Channel’ of J.K tyres ltd and is done using three main approaches, namely questionnaire, interview and observation. From the given report of the topic, the following conclusions have be en drawn: 1. Firstly, it can be concluded that the company has successfully carried out the policy of distribution. 2. Secondly, it can be said that the company manages its distribution channel very well. 3. All the given policies and procedure of distribution proved to be beneficial for the company. 4. Lastly, the conclusion to be drawn is that all the dealers as well as the customers are highly satisfied with the distribution policy of the company. Thus, the following are the conclusion that have been drawn after completing the full project report of the distribution of J.K Tyres Ltd
  47. 47. Bibliography 1. Beri G.C, “ Marketing Research”3rd edition (new delhi:Tata Megraw –hill publishing company limited) 2. Daver S Rustom “Modern marketing Management”, 7th edition(new delhi:universal Book stall 1999. 3. Philip kotler-Marketing Management,10th edition (the Millenium edition) (new Delhi, prentice-hall of India private Limited 2003.

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