Comparison of Logistics Operation of 2 FMCG Companies

1. Second Semester / NDIM / Sales & Distribution Management
Comparison of Logistics
Operation of 2 FMCG
Companies
Presented by: GROUP 5
Nikhil Manan, Abhirup Rudra, Hitesh Navriya, Prashant
Kathuria
Aanchal Sharma, Kritika Raghav
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2. Second Semester / NDIM / Sales & Distribution Management
Top listed FMCG
Companies
• Nestle s.a.
• Procter & gamble co
• Anheuser’bush inbev
• Philip morris
international inc
• Coca cola company
• Pepsico inc
• Unilever
• British american tobacco
• L’Oreal
• Monlez international inc
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3. Second Semester / NDIM / Sales & Distribution Management
HUL Overview
• Headquarters: Mumbai, Maharashtra, India
• Key people: Harish Manwani (Chairman), Sanjiv Mehta
(CEO and MD)
• Products: Foods, beverages, cleaning agents and
personal care products
• Sales Turnover of Rs.11,000 Crores.
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4. Second Semester / NDIM / Sales & Distribution Management
contd.
• Marketing Logistics – It involves planning, implementing
and controlling the physical flow of goods , services and
related information from point of origin to point of
consumption.
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5. Second Semester / NDIM / Sales & Distribution Management
Objective
• The corporate objective of HUL is "to meet the everyday
needs of people everywhere". This is met through an
extensive distribution system that covers the diverse
geographical boundaries of the country.
• Company, almost touching the lives of two out of three
Indians with 35 power brands and strong distribution
channel.
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6. Second Semester / NDIM / Sales & Distribution Management
LIM of HUL
• Logistics Information Management –IT system has been
implemented to supply stocks to RD. Stockiest have been
connected with the company through an Internet-based
network, called RSNet, for online interaction on orders,
dispatches, information sharing and monitoring.
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7. Second Semester / NDIM / Sales & Distribution Management
Distribution Network
HUL
Carrying & Forwarding Agent
Redistribution Stockiest
Wholesalers
Urban RetailersRural Retailers
Customers
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8. Second Semester / NDIM / Sales & Distribution Management
Warehouse location of
HUL
• The Warehouse Company (Machado & Sons Agents & Stevedores
Pvt Ltd.)
• Location: Verna Industrial Estate, Goa
• Cuncolim Industrial Estate
• Kundaim Industrial Estate
• Kudal Industrial Estate
• Capacity: 1,50,000 sq. ft
• Ownership: Private/Outsourced
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9. Second Semester / NDIM / Sales & Distribution Management
AMUL
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10. Second Semester / NDIM / Sales & Distribution Management
Order processing of
Amul
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11. Second Semester / NDIM / Sales & Distribution Management
Amul Overview
• Amul means priceless in Sanskrit “Amoolya”
• Brand name managed by an apex cooperation organization -
GCMMF - Gujarat Cooperative Milk Marketing Federation
• World’s biggest vegetarian Cheese brand
• World’s largest pouched milk brand
• Largest food brand in India
• Spurred the white revolution in India
• Accreditation with 9001 and HACCP certification by QAS, Australia
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12. Second Semester / NDIM / Sales & Distribution Management
GCMMF an Overview
• Members: 24 district cooperative milk producer
(VDCS)/ 17 member unions
• No. of Producer Members: 3.18 million
• No. of village societies: 13,328
• Total milk procurement - Daily: 13 million liters
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13. Second Semester / NDIM / Sales & Distribution Management
Contd.
• Cattle feed manufacturing: 3500 Mts. per day
• Milk collection (Total - 2008- 09): 3.05 billion liters
• Total Milk handling capacity: 11.22 million liters per
day
• Milk collection (Daily Average 2008-09): 8.4 million
liters
• Milk Drying Capacity: 626 Mts. Per day
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14. Second Semester / NDIM / Sales & Distribution Management
Product Share
• Amul Butter: 86%
• Ice Cream: 36%
• Chocolate: 10%
• Ghee: 20%
• Skimmed Milk Powder: 40%
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15. Second Semester / NDIM / Sales & Distribution Management
Logistics
• Logistics in Collection:
• 6 million liters of milk per day
• From about 16914 separate village cooperative Societies
• Logistics in coordination of:
• Storing the milk
• processing the milk
• distributing the milk
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16. Second Semester / NDIM / Sales & Distribution Management
Contd.
• Supplier logistics
• Weighing the milk
• Determining the FAT content
• Calculation of the purchase price
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17. Second Semester / NDIM / Sales & Distribution Management
Value Chain Analysis
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18. Second Semester / NDIM / Sales & Distribution Management
Dairy
Cheese Products
Bread Spreads
Milk Drinks & Desserts
Fresh Milk
Non-Dairy
Instant Food
Snacks
Veg. Oils
Amul Product’s
Diversification
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19. Second Semester / NDIM / Sales & Distribution Management
Products
• Bread Spreads
• Milk Drinks
• Powder Milk
• Fresh Milk
• Cheese
• For Cooking
• Chocolate
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20. Second Semester / NDIM / Sales & Distribution Management
REAPING RETURNS
• Radical changes in business processes - eliminating middlemen .
• Improved delivery mechanisms and transparency of business
operations.
• Due to this process, AMUL is able to collect six million litres of
milk per day.
• Huge reduction in processing time for effecting payments to the
farmers from a week to couple of minute.
• Processing of 10 Million payments daily, amounting to
transactions worth USD 3.78 million in cash.
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21. Second Semester / NDIM / Sales & Distribution Management
Supply Chain
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22. Second Semester / NDIM / Sales & Distribution Management
Distribution Process
Company
Wholesaler Dealer Franchisee
Retailer
Consumers
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23. Second Semester / NDIM / Sales & Distribution Management
Channel Network
• Procurement channel- upstream flow
• Distribution channel- downstream flow
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24. Second Semester / NDIM / Sales & Distribution Management
Upstream
• On an average around thousand farmers come to sell milk
at their local co-operative milk collection center.
• Each farmer has been given a plastic card for
identification.
• At the milk collection counter, the farmer drops the card
into a box and the identification number is transmitted to
a personal computer attached to the machine.
• The milk is then weighed and the fat content of the milk is
measured by an electronic fat testing machine.
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25. Second Semester / NDIM / Sales & Distribution Management
contd.
• Both these details are recorded in the PC. The computer
then calculates the amount due to farmer on the basis
of the fat content.
• The value of the milk is then printed out on a slip and
handed over to farmer who collects the payment at
adjacent window.
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26. Second Semester / NDIM / Sales & Distribution Management
Cold Storage Network
• Chillers in proximity of villages
• Prompt transport to district facilities for further dispatch to
consumers/ processing units.
• Chilled trucks to transport processed products
• Delivery to local chillers by insulated rail tankers and chilled
trucks.
• Refrigerators and freezers with retailers and departmental
stores to retain freshness
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27. Second Semester / NDIM / Sales & Distribution Management
Distribution
• GCMMF coordinated with various unions to get a regular
supply of milk and dairy products.
• The processed milk and dairy products were procured from
district dairy unions and distributed through third party
distributors.
• To ensure quality and timely deliveries, GCMMF and the
district unions had several mechanisms in place.
• The unions monitored the supplies of milk and the
distribution of finished products.
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28. Second Semester / NDIM / Sales & Distribution Management
Downstream
• First leg
• Manufacturing units to company depots using 9 and 18 MT trucks
• Frozen food below -18°C
• Dairy wet 0-4°C
• Second leg
• Depots to WDs
• Transport through insulated 3 and 5 MT TATA 407’s
• Third leg
• WDs to retailers
• Transport through rickshaw
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29. Second Semester / NDIM / Sales & Distribution Management
Reverse logistics
• MILK CHURN
• From Diary to VCs
• BOTTLE
• from retailer to diary
• DAMAGED PRODUCT
• from customer retailer then to diary
• POUCHED MILK TRAY
• from retailer to diary
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30. Second Semester / NDIM / Sales & Distribution Management
Thank You
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