MARKET SIZE The Indian FMCG sector is the fourth largest sector in the economy with a total market size in excess of $28 billion. ITC Having market capitalization of US $ 15 billion . company headquartered in Kolkata, India. Annually turnover of the company is US $ 4.75 billion. 4,86,000 share holders. The result: market capitalization of US$ 33 billion and turnover of over US$ 7 billion. ITC today is a leading FMCG marketer in India, the second largest Hotel chain, the clear market leader
INTRODUCTION ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India Limited. India Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. Chairman Y C Deveshwar
1910 Incorporation of Imperial Tobacco Company of India Limited. 1925 Setup of Packaging & Printing Business 1975 Launched its Hotels business. 1979 Entered the Paperboards business 1990 Set up the Agri Business Division 2000 Launched a line of high quality greeting cards under the brand name Expressions‘ 2000 Entered the Lifestyle Retailing business with the Wills Sport. 2000 Spun off ITC InfoTech India Limited.
2001 Introduction of Kitchens of India Indian gourmet dishes 2002 Launch of the brands mint-o and Candyman confectionery and Aashirvaad atta 2002 Started marketing popular safety matches brands like iKno, Aim 2003 Foray into the marketing of Agarbattis (Mangaldeep) 2005 Introduced Essenza Di Wills, an exclusive range of fine fragrances 2007 Entered the fast growing branded snacks category with Bingo!. 2007 Launched the Superia range of Soaps and Shampoos in the mass-market segment.
Based on the production in India biscuits can be broadly classified into:-
Pattern of Biscuit Consumption(On Zonal basis) in the country are as below:Northern Zone - 25%Western Zone - 23%Southern Zone - 24%East and NorthEast Zone - 28%(Including N.East)
Rural-urban penetration of Biscuit:Urban Market : 75% to 85%Rural Market : 50% to 65%
Annual Growth The biscuit industry in India witnessed annual growth as below:- 2003-04 - 15% 2004-05 - 14% 2005-06 - 14% 2006-07 - 13% 2007-08 - 15% 2008-09 - 17% 2009-10 - 19%
Biscuit: Growth potentialThe Biscuits industry in India is worth around Rs. 3000 crores and 30% of it belongs to the organized sector. It is the largest among all food industries in the country and is expected to grow at about 17-19% in the years to come.
ITEM DISCRIPTION UN WITHOUT VAT AFTER MRP VAT RATE 14% VATGLB GLUCOSEBISC PC 1.61 0.22254 1.83 2/-35 UIT 35.2GMGL GLUCOSEBISC PC 3.13 0.4382 3.17 5/-O69 UIT 60GM RS4 BOURBON 74BOB GM PC 7.83 1.092 8.92 10/-01 BOURBON 74MA GM PC 7.83 1.092 8.92 10/-110SC SPECIAL158 CHOCO 129GM PC 7.83 1.092 8.92 10/-OR ORENGE 156156 GM 20/- PC 15.67 2.2932 17.86 20/-
PAWANS SPECIALITIES PVT. LTDSTOCK AS ON 7/10/11.SR NO. ITEM DISCRIPTION UN WITHOUT VAT RATE BOB BOURBON 74 GM,01. 01 10/- PC 7.83 BUTTERSCOTCH PC02. BU001 78GM ,10/- 7.83 GOLD.BAKE.BUTE03. BUTO2 ERSCOTCH 75gm, PC 11.81 SPL04. CC165 CHOCOCOOKIES PC 15.67 165GM SC SPECIAL CHOCO05. 158 129GM PC 7.83 OR ORENGE 156 GM06. 156 20/- PC 15.67 MARIE OATS 7.8407. MA110 110GM RS10 PC MARIE LIGHT 180 PC 11.7508. MA111 GM09. MARIE LIGHT PC 7.84 ML130 130GM10. MARIE LIGHT PC 11.75 ML199 199GM TOTAL FOR BI ………………….
Distribution of Food Products Strict compliance standards, low profit margins, intense competition, and high customer-service expectations. Fast and effective sales ordering processes. Flexibility Quick reaction BEAT PLAN TO GENERAL STORES ROUTE PLAN FOR MODERN TRADE KEY OUT LET
BEAT PLAN FOR GENERAL STOREProcess -Route plan sales order on previous day or P.O on previous day supply on next day by transportation collection of payment (1 to 3.. Wickless cover 70 to 80 shops)Beat Plan- Sales person visit a particular area on weekly basis. Main out lets are visited twice a week. Nearly 30 to 40 stores daily Monday to Saturday
SUPERVISOR DS ROUTE Bandra west 30 to 40 shops daily) Anil gupta Manoj Mount mary,Band stand,chambai, parry cross, Shirley rajan road. Asif ali (30to 40 shops daily) Hill road, chapel, road.
Key out let supervisor visit different different out let as per route plan.Key out let sayales man visit all key outlet on route plan basisDifferent outlets on daily visit.Visit from Monday to Saturday.
SUPPLY IN MODERN TRADEIn modern trade(Big Bazar,vishal) P.O Is mail to distributor point, or collect by sales man.Sales man visit different route on day’s basis.If there is shortage of products sales man notice them and contact to category head for O.P.
MARGIEN AND SCHEMEDistributor - Margin scheme 3%Modern trade - margin buy 4 12-14% get 1 freeGeneral stores- 10-12%Wholesaler - 10-12%+2%Keep fresh stock on frontGive scheme if stock is about to expiry.
Distribution System ITC uses FIFO method to reduce the wastage of goods, due to expiry. (Biscuits expire in 6 months) They also keep the Biscuits on constant move from low sales area to high sales area. The company collects all the expired Biscuits from market and destroys them. Retailers must return expired or damaged products within time before the date of expire.
Distribution System Adjustment for them is done in every months time. ITC provides their retailers with racks, psu’s, fod’s,(face on display), standees and Glow shine boad,etc to display the products. The benefits received by the retailers depend upon their sales volume and also the location of their shops. ITC has hired merchandiser to promote Biscuits
Flow Diagram CNF Mumbai Hoskote Bangalore FACTORY WHOLESALE DEALER BASE Santacruj (mumbai) Hill road ( shri traders)WHOLESALE RETAILER Bandre(w)DISTRIBUTOR Sarley rajan road
PAYMENT COLLECTIONModern trade – credit of 7 to 15 days.General trade - cash, or credit of 7 to 15 days.
NEW PRODUCT LAUNCHDark fantasy chocolate 20/-Chocolate cookies 60g, 5/- (without cream)
NEW PRODUCT LAUNCHSoon coming with…………….ITC is coming with two new veritiesa)Dream cream chocolate vanilla.b)strro berry vanilla. RS. 10 and 20
COMPITITOR PRODUCTS COMPETITORS GLUCOSE PARLE, BRITANIA MARIE AND HORLICKS BUTTERBITE PRIYA GOLD, AND CREAM ANMOL,BRITANI AND PARLE
COMPETITION STRATEGY One of the well known brand in India. Powerful Brands across segments. Leadership in segments - geographic & price. Extensive FMCG distribution network. Direct servicing of 1,00,000 markets & nearly 2 million Retail outlets. Exciting long term growth potential. World-class state-of-the-art technology and products.
COMPETITION STRATEGYMaintaining relation ship with both retailer and distributor.Market divination into Grocery out let, convince outlet,(sell all product except Atta, dale, ready to eat salt) Modern Trade, etc.PSU’S (Packet staking unit)Face on displayPlannogrammingLaunching new brandsIn shop display
UNIQUEITC is unique as an organization, they are into various sectors in the business.A) Distribution channelB) Distribution cycleC) DisplayD) Promotion strategiesE) Plannogramming
Observations Food products are normally a high volume ball game. Products have to essentially be available in the market at all given points of time and at all given points of purchase. The supply of products takes place virtually on a daily basis in fixed quotas or otherwise, to retailers as per their requisitions and the anticipation of demand and the performance of products in the recent past.
Observations The skeleton of distribution system is same for all the companies. Companies try very hard to make a difference at some point to get the competitive advantage. ITC has a very strong distribution network for their cigarette brands and they are using this network to push their new biscuit brands. Credit system also depends upon the position of the product in the market.
Observations Companies with top product are hard to bargain on credits. Companies also use their premium products to push their non premium products.
LEARNING ITC new product launching strategies-Invite retailersTraining to staffSchemesIncentiveVisibility DisplayIn shop DisplayFOD’S (face on displayFree samplesBandra is called testing market