ITC Limited One of India’s Most Admired Companies

ITC SUNFEAST BISCUITS

SALES AND DISTRIBUTION

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

 

MARKET SIZE

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

INTRODUCTION

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.

Corporate Governance Structure

ITC Ltd.

FMCG-Cigarettes

FMCG-Others

Hotels

Agri Business

Paperboards & Packaging

InfoTech

ITC Business Portfolio

FMCG

,

Paper & PackagingHotels Agri

Business

Information Technology

Cigarettes Personal Care Lifestyle Retailing

Education & Stationery Matches Incense Sticks

Foods

Organizational Structure

SALES ORGANISATION STRACTURE

Area executive

DISTRIBUTOR

SUPERVIOSOR

SALESMAM

SALESMAN

SUPERVISOR

SALESMAN

WD point at santa cruj

WD Area from Santa cruj to Bandra

NO.of A.E = 2

NO.of supurviser = 7

NO. OF sales man = 17

Introduction to Sunfeast

Launched in July, 2003

Growth rate of 53%

Turnover of over 1000 crore

Wide categorization

Products at a Glance

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 North East 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 potential

The 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.

MARKET SHARE

ITC

10%

31%

14%9%

35%

Column1

SUNFEST BRITANIA PRIYA GOLDOTHERS PARLE-G

ITEM DISCRIPTION UN WITHOUT VAT RATE

VAT 14%

AFTER VAT

MRP

GLB 35

GLUCOSEBISCUIT 35.2GM

PC 1.61 0.22254 1.83 2/-

GL O69

GLUCOSEBISCUIT 60GM RS4

PC 3.13 0.4382 3.17 5/-

BOB01

BOURBON 74 GM PC 7.83 1.092 8.92 10/-

MA110

BOURBON 74 GM PC 7.83 1.092 8.92 10/-

SC158

SPECIAL CHOCO 129GM PC 7.83 1.092 8.92 10/-

OR156

ORENGE 156 GM 20/- PC

15.67 2.2932 17.86 20/-

PAWAN'S SPECIALITIES PVT. LTDSTOCK AS ON 7/10/11.

SR NO. ITEM DISCRIPTION UN WITHOUT VAT RATE

01.BOB01

BOURBON 74 GM, 10/- PC

7.83

02. BU001BUTTERSCOTCH 78GM ,10/-

PC 7.83

03. BUTO2GOLD.BAKE.BUTEERSCOTCH 75gm,

PC 11.81

04. CC165SPL CHOCOCOOKIES 165GM

PC

15.67

05.SC158

SPECIAL CHOCO 129GM PC 7.83

06.OR156

ORENGE 156 GM 20/- PC

15.67

07. MA110 MARIE OATS 110GM RS10 PC

7.84

08. MA111 MARIE LIGHT 180 GM

PC 11.75

09.ML130

MARIE LIGHT 130GM

PC 7.84

10.ML199

MARIE LIGHT 199GM

PC 11.75

TOTAL FOR BI ………………….

Cnf

DISTRIBUTOR

Wholesaler

Retailer

Customer

Customer

Key outlet

customer

Modern trade

Customer

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 STORE

Process - 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 basis

Different outlets on daily visit.

Visit from Monday to Saturday.

SUPPLY IN MODERN TRADE

In 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 SCHEME

Distributor - Margin scheme 3%Modern trade - margin buy 4 12-14% get 1 free General 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

Mumbai Hoskote Bangalore

Santacruj (mumbai) Hill road ( shri traders)

Bandre(w)

Sarley rajan road

FACTORY

CNF

WHOLESALE DISTRIBUTO

R

WHOLESALE DEALER

BASE

RETAILER

PAYMENT COLLECTION

Modern trade – credit of 7 to 15 days.

General trade - cash, or credit of

7 to 15 days.

NEW PRODUCT LAUNCH

Dark fantasy chocolate 20/-

Chocolate cookies 60g, 5/- (without cream)

NEW PRODUCT LAUNCH

Soon coming with…………….

ITC is coming with two new verities a)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

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 STRATEGY

Maintaining 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 brands In shop display

COMPETITION STRATEGY

ITC is unique as an organization, they are into various sectors in the business.

A) Distribution channelB) Distribution cycleC) Display D) Promotion strategiesE) Plannogramming

UNIQUE

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 retailers Training to staffSchemesIncentiveVisibility DisplayIn shop DisplayFOD’S (face on displayFree samplesBandra is called testing market

Presented by: VIKRAM SINGH Khangarot

ROBIN MAHAROOF

BINA Bhatia

ITC SUNFEAST BISCUITS