AN

EXPERIMENTAL STUDY

TOFIND NEW BUSINESS OPPORTUNITIES

IN

CUTTACK DISTRICT OF RURAL ORISSA

FOR

DABUR INDIA LTD.

[A Project report submitted for the partial fulfillment of the requirements for the degree of Master in Business Administration (MBA) affiliated to Biju Pattnaik University of Technology, Rourkela.]

Submitted By:-

DIBYALOK BISOIRegd. No. – 0806247102

Under The Guidance Of Internal Guide:-

Mr. MUKESH MISHRA

Senior Marketing Faculty

Regional College of Management, Bhubaneswar

Under The Guidance Of External Guide:-

Mr. DHEEMAN BHATTACHARYA

A.S.M. Orissa

Dabur India Ltd.

REGOINAL COLLEGE OF MANAGEMENT

CHAKADOLABIHAR, CHANDRASEKHARPUR BHUBANESWAR, ORISSA – 23.

CERTIFICATE

This is to certify that the project study entitled “FINDING NEW BUSINESS

OPPORTUNITIES IN CUTTACK DISTRICT OF RURAL ORISSA” is a bonafide work

done by________________, Regd.no-____________ , of Regional College of

Management, Bhubaneswar, and submitted in partial fulfillment of the award

of degree in Master of Business Administration before Biju Pattnaik

University of Technology, Rourkela.

Faculty guide:

Prof………………………..

DECLARATION

I, __________________ hereby declare that the project report on “Finding New

Business Opportunity in Cuttack District of Rural Orissa” submitted to the

company is done under the supervision of Mr. Dheeman Bhattacharya, ASM of

Dabur India Ltd. For Orissa circle (External guide) and is my own effort and is

not published in any other organization.

Place : Bhubaneswar

Date : 19.10.2009 Regn. No.-

ACKNOWLEDGEMENT

First and foremost I thank the Almighty God for sustaining the enthusiasm with which plunged into this endeavor.

I avail this opportunity to express my profound sense of sincere and deep gratitude to many people who are responsible for the knowledge and experience I have gained during the project work.

I extend my overwhelming gratitude to Dr Sujata Mangaraj, (Dean MBA Department), for this valuable guidance and meticulous supervision during the preparation of this project report.

I would like to express my sense of gratitude to my Internal Guide Mr. Mukesh Mishra, (Faculty of Marketing, MBA) for availing us marketing techniques and skills for the project.

I would like to express my deep sense of gratitude to Mr. Dheeman Bhattacharya, (ASM of Dabur India Ltd), for the valuable help and guidance through the project work.

My hearty and inevitable thanks to all the respondents who has helped me to bring out the project in a successful manner.

Contents

Abstract

Introduction

Company Profile

Distribution Network of Dabur

Rural Communication Tools

Objective of Report

Research Methodology

Method of Data Collection

Data Analysis & Interpretation

Findings

Recommendations

Conclusion

Bibliography

Annexure

Abstract

The Fast Moving Consumer Goods (FMCG) sector is a corner stone of the

Indian economy. This sector touches every aspect of human life. The FMCG

producers now realize that there is a lot of opportunity for them to enter into the

rural market. The sector is excited about the rural population whose incomes are

rising and the lifestyles are changing. There are as many middle income

households in the rural areas as there are in the urban. Thus the rural marketing

has been growing steadily over the years and is now bigger than the urban market

for FMCGs. Globally , the FMCG sector has been successful in selling products

to the lower and middle income groups and the same is true in India. Over 70%

of sales is made to middle class households today and over 50% of the middle

class is in rural India. The sector is excited about a burgeoning rural population

whose incomes are rising and which is willing to spend on goods designed to

improve lifestyle. Also with a near saturation and cut throat competition in urban

India, many producers of FMCGs are driven to chalk out bold new strategies for

targeting the rural consumers in a big way. But the rural penetration rates are

low. This presents a tremendous opportunity for makers of branded products who

can convert consumers to buy branded products. Many companies including

MNCs and regional players started developing marketing strategies to lure the

untapped market. While developing the strategies, the marketers need to treat the

rural consumer differently from their counterparts in urban because they are

economically, socially and psycho-graphically different to each other. This paper

covers the attractions for the FMCG marketers to go to rural, the challenges, the

difference between the rural and the urban market and the suitable marketing

strategy with the suitable example of companies and their experience in going

rural.

Introduction

The Indian Fast Moving Consumer Goods (FMCG) industry began to shape during the last fiftyodd years. The FMCG sector is a cornerstone of the Indian economy. This sector touches every aspect of human life. Indian FMCG market has been divided for a long time between the organized sector and the unorganized sector. Unlike the US market for FMCG which is dominated by a handful of global players, India’s Rs. 460 billion FMCG market remains highly fragmented with roughly half the market going to unbranded , unpackaged home made products. This presents a tremendous opportunity for makers of branded products who can convert consumers to buy branded products. Globally, the FMCG sector has been successful in selling products to the lower and middle income groups, and the same is true in India. Over 70% of sales is made to middle class households today and over 50% is in rural India. The sector is excited about a burgeoning rural population whose incomes are rising and which is willing to spend on goods designed to improve lifestyle. Also with a near saturation and cut throat competition in urban India , many producers of FMCGs are driven to chalk out bold new strategies for targeting the rural consumer in a big way. MART, the specialist rural marketing and rural development consultancy, has found that 53 per cent of FMCG sales and 59 per cent of consumer durable sales lie in the rural areas. Of two million BSNL mobile connections, 50 per cent went to small towns and villages; of 20 million Rediffmail subscriptions, 60 per cent came from small towns; so did half the transactions on Rediff's shopping site. According to a study by Chennai-based Francis Kanoi Marketing Planning Services Pvt Ltd, the rural market for FMCG is worth Rs.65,000 crore, for durables Rs 5000 crore, for tractors and agri-inputs Rs.45,000 crore and two- and four-wheelers, Rs.8000 crore.

In total, a whopping Rs.123,000 crore. This could be doubled if corporates understood the rural buying behaviour and got their distribution and pricing right.

Impulse to go Rural

There are many reasons that has urged the FMCG companies to enter the uncharted territory of rural India. Some of the attractions are discussed below;

1. Large Population The rural Indian population is large and its growth rate is also high. Over 70% India’s one billion plus population lives in around 627,000 villages in rural areas. This simply shows the great potentiality rural India has to bring the much needed volumes and help the FMCG companies to bank upon the volume driven growth.

Table 1. Percentage distribution of households and income

2. Rising Rural Prosperity India is now seeing a dramatic shift towards prosperity in rural households. To drive home the potential of rural India just consider some of these impressive facts about the rural sector. As per the National Council for Applied Economic Research (NCAER) study, there are as many ‘middle income and above’ households in the rural areas as there are in the urban areas. There are almost twice as many ‘lower middle income’ households in rural areas as in the urban areas.

Table 2. Distribution of people income-wise

According to NCAER projections, by 2006 – 07, the lowest income class (i.e.Rs.2500 and below) will shrink by more than 60%. The higher income classes are likely to double by 2006 – 07. This apparently is the result of development work,

which happened under the five years plans and other special programmes such as land reforms, rural electrification rural communication, and rural credit facilities, etc. The absolute size of the rural market is thus expected to double that of urban India. But despite the high rural share in these categories, the rural penetration rates are low, thus offering tremendous potential for growth. According to Mr. D. Shivakumar, Business Head (Hair), Personal Products Division, Hindustan Lever Limited, the money available to spend on FMCG (Fast Moving Consumer Goods) products by urban India is Rs. 49,500 crores as against is Rs. 63,500 crores in rural India.

3. Growth in Market The purchasing power in rural India is on steady rise and it has resulted in the growth of the rural market. The market has been growing at 3-4% per annum adding more than one million new consumers every year and now accounts for close to 50% of volume consumption of FMCG. The growth rates of lot of FMCG are higher in rural markets than urban markets. In product categories like toilet soaps, talcum powder, cooking iol, vanaspati ghee, tea, cigarettes and hair oil, the share of rural market is more than 505. The table above indicates the projected market size of FMCG products in 2001 – 02 and 2006 – 07 based on the annual growth rates compounded for 1994 – 99 period.The estimated annual business from rural markets was Rs 1,23,000 crore, comprising Rs 65,000 crore of FMCG, Rs 5,000 crore of durables, Rs 45,000 crore of agricultural inputs including tractors and Rs 8,000 crore of two-wheelers and fourwheelers. Twenty nine per cent of the rural people own cars, 27 per cent own colour televisions, 24 per cent own refrigerators and 10 per cent own washing machines, which points to the untapped potential in the rural areas. "We therefore have to look at the rural market very seriously for future expansion," said Mr Nandakumar while inaugurating the Business Line Club and delivering the keynote address on the topic, `Brand Building Beyond the Urban' under the auspices of the Departments of Business Management and Commerce of the Auxilium College here on Friday.

Table 3. Rural FMCG market Projections

4. Effectiveness of Communication An important tool to reach out to the rural audience is through effective communication.”A rural consumer is brand loyal and understands symbols better. This also makes it easy to sell look – alike", says Mr. R.V Rajan, CMD, Anugrah Madison Advertising. The rural audience has matured enough to understand the communication developed for the urban markets, especially with reference to FMCG products. Television has been a major effective communication system for rural mass and, as a result, companies should identify themselves with their advertisements. Advertisements touching the emotions of the rural folks, it is argued, could drive a quantum jump in sales.

5. Impact of Globalization The impact of globalization will be felt in rural India as much as in urban. But it will be slow. It will have its impact on target groups like farmers, youth and women. Farmers, today 'keep in touch' with the latest information and maximize both ends. Animal feed producers no longer look at Andhra Pradesh or Karnataka. They keep their cell phones constantly connected to global markets. Surely, price movements and products' availability in the international market place seem to drive their local business strategies. On youth its impact is on knowledge and information and while on women it still depends on the socio-economic aspect. The marketers who understand the rural consumer and fine tune their strategy are sure to reap benefits in the coming years. In fact, the leadership in any product or

service is linked to leadership in the rural India except for few lifestyle-based products, which depend on urban India mainly.

Company profile The evolution of Dabur is quite interesting and its root takes us back to the 19th century where it all started in Bengal by a visionary Dr. S.K Burman, a physician by profession. His mission was to provide effective and affordable cure for ordinary people in far-flung villages. With missionary zeal and fervour, Dr. Burman undertook the task of preparing natural cures for the killer diseases of those days, like cholera, malaria and plague. Soon the news of his medicines travelled, and he came to be known as the trusted 'Daktar' or Doctor who came up with effective cures. And that is how his venture Dabur got its name - derived from the Devanagri rendition of Daktar Burman. The name is formed by joining the first half of Daktar and Burman.

The birth of Dabur in a small Calcutta pharmacy, where Dr. S. K Burman launched its mission of making healthcare product in 1884. With growing popularity of Dabur products, he expands his operation by setting up a manufacturing plant for mass production in 1896.

Dabur enters specialized area of nature-based ayurvedic medicines for which standardized drugs are not available in 1900 in the market. The need to develop scientific processes and quality checks for mass production of traditional ayurvedic medicines lead to establishment of research laboratory in 1919. Dabur expands further with new manufacturing plants at Narendrapur and Daburgram in 1920.

The distribution of Dabur products speared to the other states like Bihar and the North east. Dabur become a full fledged company i.e, Dabur India Pvt. Ltd. In 1936. In 1972, Dabur’s operation sifted to Delhi and production starts from new Sahibabad factory, one of the largest and best equipped production facilities for ayurvedic medicines. In 1986 Dabur India Pvt. Ltd. Becomes public limited company as Dabur India Ltd.

Dabur India Limited is the fourth largest FMCG Company in India with interests in Health care, Personal care and Food products. Building on a legacy of quality and experience for over 100 years, today Dabur has a turnover of Rs.2396 crore with powerful brands like Dabur Amla, Dabur Chawanprash, Vatika, Hajmola & Real.

Dabur India Limited has marked its presence with significant achievements and today commands a market leadership status. Our story of success is based on dedication to nature, corporate and process hygiene, dynamic leadership and commitment to our partners and stakeholders. The results of our policies and initiatives speak for themselves.

  Leading consumer goods company in India with a turnover

of Rs. 2834.11 Crore (FY09) 3 major strategic business units (SBU) - Consumer Care

Division (CCD), Consumer Health Division (CHD) and International Business Division (IBD)

3 Subsidiary Group companies - Dabur International, Fem Care Pharma and newu and 8 step down subsidiaries: Dabur Nepal Pvt Ltd (Nepal), Dabur Egypt Ltd (Egypt), Asian Consumer Care (Bangladesh), Asian Consumer Care (Pakistan), African Consumer Care (Nigeria), Naturelle LLC (Ras Al Khaimah-UAE), Weikfield International (UAE) and Jaquline Inc. (USA).

17 ultra-modern manufacturing units spread around the globe

Products marketed in over 60 countries Wide and deep market penetration with 50 C&F agents,

more than 5000 distributors and over 2.8 million retail outlets all over India

Consumer Care Division (CCD) adresses consumer needs across the entire FMCG spectrum through four distinct business portfolios of Personal Care, Health Care, Home Care & Foods

Master brands:Dabur - Ayurvedic healthcare productsVatika - Premium hair careHajmola - Tasty digestivesRéal - Fruit juices & beverages Fem - Fairness bleaches & skin care products

9 Billion-Rupee brands: Dabur Amla, Dabur Chyawanprash, Vatika, Réal, Dabur Red Toothpaste, Dabur Lal Dant Manjan, Babool, Hajmola and Dabur Honey

Strategic positioning of Honey as food product, leading to market leadership (over 75%) in branded honey market 

Dabur Chyawanprash the largest selling Ayurvedic medicine with over 65% market share.

Vatika Shampoo has been the fastest selling shampoo brand in India for three years in a row

Hajmola tablets in command with 60% market share of digestive tablets category. About 2.5 crore Hajmola tablets are consumed in India every day

Leader in herbal digestives with 90% market share

Consumer Health Division (CHD) offers a range of classical Ayurvedic medicines and Ayurvedic OTC products that deliver the age-old benefits of Ayurveda in modern ready-to-use formats

Has more than 300 products sold through prescriptions as well as over the counter

Major categories in traditional formulations include:- Asav Arishtas- Ras Rasayanas- Churnas

- Medicated Oils Proprietary Ayurvedic medicines developed

by Dabur include:- Nature Care Isabgol- Madhuvaani- Trifgol

Division also works for promotion of Ayurveda through organised community of traditional practitioners and developing fresh batches of students.

International Business Division (IBD) caters to the health and personal care needs of customers across different international markets, spanning the Middle East, North & West Africa, EU and the US with its brands Dabur & Vatika 

 

Growing at a CAGR of 33% in the last 6 years and contributes to about 20% of total sales

Leveraging the 'Natural' preference among local consumers to increase share in perosnal care categories

Focus markets:- GCC- Egypt- Nigeria- Bangladesh- Nepal- US

High level of localization of manufacturing and sales & marketing

Distribution network of dabur

Distribution is all important links between a manufacturer and his

customer. The concern is for designing a distribution strategy to facilitate

the smooth physical flow of products from the manufacturer to the

purchasing point of customers.

Channel of distribution refers to the alternate path through which goods

can be routed. Thus the path verily defines the flow of product from point

of production to the point if purchase.

In the current customer focused and shrinking lead times, business

success is derivative of the organization efforts to transfer their

resources- tangible and intangible to deliver right product at the right

time. It can also be said as the organizations growth and success largely

depends upon its selling and distribution strategy.

In this context Dabur has managed a quite well distribution network

meeting its corporate strategy both for the urban as well as for the rural.

Hence, its rural strategy gives most emphasis on its distribution strategy

for effective penetration in the targeted area of operation.

Let’s discuss the distribution structure of the Dabur India Ltd. For rural as well as for the urban areas.

URBAN DISTRIBUTION CHANNEL

This is divided into two parts, viz: above 5 lakhs of population and

between 1 to 5 lakhs of population. This segment is totally covered by the

direct stockiest. In the segment of above 5 lakhs there are three ways of

covering the market, viz: Beat wise, Line wise & Channel wise distribution

while in the segment of 1 to 5 lakhs of population there are two ways, viz:

Channel wise & Beat wise.

CHANNEL WISE DISTRIBUTION

Here the total product is divided into different channels like, Health

care product, Personal care products, Home products & etc.

BEAT WISE DISTRIBUTION

Here total market is divided into different areas where the total

products are served to all the outlets exist in that area.

LINE WISE DISTRIBUTION

Here the total product is divided into different lines like, hair care,

body wash, coconut oil, nutrition food and etc.

RURAL DISTRIBUTION NETWORK

Under rural distribution network, the whole market is served by

three parties, viz: Sub stockiest, Rural Direct Stockiest and by the Dabur

network itself. The Sub stockiest get the required product through the

super stockiest which again covers the Dabur itself segment. The Rural

Direct Stock segment is covered by the Direct stockiest which serves the

whole urban distribution. The Substokist uses the Sub van mode of

transportation while the Rural direct stockiest uses the Direct Van to

cover his area. (Refer to previous page).

Dabur is continuously monitoring its channel members to ensure

the speed and accuracy in its service to its ultimate customers. The key

customers for Dabur are Whole seller, Small Outlets and the Chemist.

Dabur has continuously focusing on these key customers and tried to

satisfy them over the years to sustain in this industry.

Rural communication tools

Rural India has been sowing its massive potentials to grow in future

having more than 68% of total population. Here we can’t ignore those

three industries (Pharmacy, FMCG & Infrastructure) which are

continuously feeding to the rural up gradation. As one of the major player

in the FMCG Industry Dabur India Ltd. Is continuously up grading its rural

communication tools to aware its customer about its herbal products

which helps them to understand their health in depth.

There are certain strategic communication tools the Dabur India

Ltd. Is continuously using to make its customers sure about their health.

They are:-

Focusing on DD channels to place its advertisement.

Dabur India believes that there are still many villages which don’t

have a cable TV or any Dish Antenna which will give them the opportunity

to access more channels. So they manage to see the DD Channels for

their entertainment. So Dabur India chooses to focus on the DD brands to

place their advertisements, which are being seen by more people.

Wall Paintings

This is a concept Dabur India is using to make its rural

communication to more stronger. Here Dabur India focuses primarily on

those people who do not have the access to watch the TV. Again Dabur

India thinks pictures are more memorable than other brands. So it

chooses to have wall paintings on the big walls in a village.

Bandwagon.

This is a concept Dabur India uses where it will have to take a Van

with ready stock into a village. After reaching to that village it will

perform a live promotion and sell its products to the outlets available

there. This concept is proven to be very effective in front of the villagers

which make them brand loyal with the entertainment.

There are many other B.T.L promotion which Dabur India often uses

to make its Rural communication effective. It creates a sense of

belongingness among the rural customer which altimately helps the

company to add value to its goodwill.

Objective of report

PRIMARY OBJECTIVE:

To find out new business opportunity of Cuttack District in rural Orissa for

Dabur India ltd.

SECONDARY OBJECTIVE:

To analyze the availability and visibility of Dabur products in rural Orissa

(Cuttack District).

Coverage analysis In rural Orissa (Cuttack District).

To find out the feasibility of new sub stockiest in rural Orissa, Cuttack District.

Research methodology

Marketing research plays an important role in the process of marketing starting with market component of the total marketing tasks. It helps the firm to acquire a better understanding of the consumers, the competition and the marketing environment. Research extends knowledge about a particular case through the researcher who builds up a wealth of knowledge through their research findings.

It is a step-by-step logical process, which involves:

Defining a problem Laying the objectives of the research Sources of data Methods of data collection Tabulation of data Data analysis & tabulation Conclusions & recommendations

Research Plan

The Primary objective of the project was to understand the rural market conditions of dabur product in chosen areas of Cuttack with special reference the availability, visibility, turnover, pcs, pcc, dabur company coverage through market survey and how to improve the sales promotion and brand awareness of DABUR. in rural areas.

Types of Research:

Pure and applied research

Pure research is taken for the sake of knowledge without any intention to apply it in practice. It is undertaken out of intellectual curiosity or inquisitiveness. It lays the foundation for applied research. Applied research is carried on to find solution to a real-life problem so it is problem oriented and action oriented.

Exploratory research

Exploratory research is preliminary study of an unfamiliar problem about which the researcher has little or no knowledge at all. It is done at two levels- first, the discovery of variables in the situation. Second, is the discovery of relationship between the variables.

Experimental research

It is designed to assess the effects of particular variables on a phenomenon by keeping the other variables constant or controlled.

Descriptive research

A descriptive study is a fact finding investigation aimed at identifying the various characteristics of a problem under study but it does not deal with testing of hypothesis. Data are collected by using observation, interviewing and mail questionnaire.

My project involves descriptive study.

Sampling Techniques:

Sampling is that part of statistical practice concerned with the selection of individual observations intended to yield some knowledge about a population of concern, especially for the purposes of statistical inference.

Probability sampling:

A probability sampling is one in which every unit in the population has a chance (greater than zero) of being selected in the sample, and this probability can be accurately determined.

Probability sampling includes: Simple Random Sampling, Systematic Sampling, Stratified Sampling, Probability Proportional to Size Sampling, and Cluster or Multistage Sampling.

Non-Probability sampling:

Nonprobability sampling is any sampling method where some elements of the population have no chance of selection (these are sometimes referred to as 'out of coverage'/'undercovered'), or where the probability of selection can't be accurately determined.

Nonprobability Sampling includes: Accidental Sampling, Quota Sampling and Purposive Sampling.

Quota sampling:

In quota sampling, the population is first segmented into mutually exclusive sub-groups, just as in stratified sampling. Then judgment is used to select the subjects or units from each segment based on a specified proportion. Quota sampling is useful when time is limited, sampling frame is not available

My project involves Non-Probability Quota sampling.

Sampling units:

Sampling units were geographical area of Cuttack which includes 26 Rural villages.

Geographical areas visited:Agrahat, Balisahi, Banara, Berhampura, Binishpur, Gatiroutpatna, Gobra, Harirajpur, Jamadeipur, Kaitha, Kanheipur, Kantapada, Mouda, Munduli, Nandol, Padhansahi, Panchagan, Patapur, Purunatigiria, Ragadipatana, .

The retailers visited during the survey were considered the sampling units.

Sample Size:

The sample size according to the quota sample was 150 retailers but I covered 91 retailers so the actual sample size is 91 units. This is because some of the outlets were closed , some villages are flood affected, no communication, some shops were which did not keep Dabur’s product.

Method of data collection

The descriptive nature of research necessitates collection of primary data from retailers through market survey, personal interview technique was used.The market research was conducted over a period of 60 days. Data was tabulated, analyzed and suggestion and recommendation were given.

Sources of data:

Data refers to a collection of natural phenomena, descriptors, including the results of experience, observation or a set of premises. This may consist of nos., words or images particularly as measurements or observations of a set of variables.

There are two sources of data:

Primary Source:

Data obtained from the first hand by the researcher is called the primary data. This data is that the researcher collects himself. It is reliable way to collect data as it requires researcher to interact with the source and extract information. It allows the learner to access original & unedited information.

Its methods are -

SurveysObservationsQuestionnaireExperiments

I collected data using the primary method by surveys,observation and interviewing the retailers.

Secondary Source:

The secondary data that I collect for my project is from Dabur India Ltd website and some data are given by Mr Dheeman Bhatacharya, the regional sales manager.

Data analysis & interpretation

While finding the “New Business Opportunity in the Rural Market of Cuttack District”, 20 villages where surveyed and from that the primary data’s where obtained. These primary data has been analyzed and interpreted as follows:

1) AVAILABILITY OF DABUR:

YES NO

Series1 74 15

5

15

25

35

45

55

65

75

Availability of Dabur

No.

of O

utle

t

The above figure shows the availability of Dabur product in different outlets. There were 91 outlets that were surveyed and from those outlets 74 outlets had Dabur product and 15 of them didn’t have Dabur product.

From these 15 outlets, Munduli is a village where the Dabur product is unavailable. The retailers are not keeping Dabur product saying the price is high and the customers are not as asking for it.

2) OUTLET-WISE TOTAL TURNOVER:

500010000

1500020000

2500030000

3500040000

4500050000

5500060000

6500070000

7500080000

8500090000

95000

100000

150000

200000

25000002468

1012141618

Total Turnover ( Outlet )

Sales per Month

No.

of O

utle

t

The above chart shows the total turnover of all the outlets that were surveyed. The sales figure that has been shown here are as per monthly basis.

It is found that most of the outlets lies between 10,000 – 25,000. It shows that most of the villages have an average sales of Rs. 17,000. It is also seen that some of the outlets have a monthly sales of over Rs.1, 00,000.This shows that there are some villages that have potentials customers. So, it will benefit if more focus is given to this outlets, as they have more customer preference.

3) OUTLET-WISE DABUR TURNOVER:

150 300 450 600 750 900 1050 1200 1350 1500 160002468

101214161820

Dabur Turnover ( Outlet )

Sales per Month

No.

of O

utle

t

This chart shows outlet wise monthly turnover of Dabur.

It is seen that only 19 outlets from 74 have a monthly sales of over Rs.1600 and rest outlets have a monthly sales below Rs.1500. This shows that

these outlets have business opportunity, as the average total sales of most outlets are above Rs.17,000 and this difference is huge. It can be done by appointing sub-stockiest at right area.

4) OUTLET-WISE HUL’S TURNOVER:

5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 650000

5

10

15

20

25

30

HUL Turnover ( Outlet )

Sales per Month

No.

of O

utle

t

The above chart shows the outlet wise turnover of HUL. It can be found out that most of the outlets monthly sales come to around Rs.10, 000. It is also seen that the average sales of many outlets comes around Rs.8, 500 which is around 50% of average total sales of most outlets.

The dominance of HUL in rural market might be possible because of his distribution network and availability of a wide range of products in the market. So, it can be possible for Dabur to increase its market share by improving its distribution channels and widening up its product range.

5) AVAILABILITY OF DABUR

AGRA-HAT

BAL-ISAHI

BANARA BERHAMPURA

BINISH-PUR

GATIROUT-

PATNA

GOBRA HARIRA-JPUR

JA-MADEIP

UR

KAITHA

Total Sales

217000 21000 167000 193000 48000 300000 145000 147000 45000 48000

Dabur Sales

6080 1000 11400 18800 1800 26400 3100 9600 900 1500

HUL Sales

62200 7000 57000 76000 13000 89000 30000 42000 10500 12000

2500075000

125000175000225000275000325000

Village Wise Turnover

Sale

s per

Mon

th

KAN-HEIPUR

KANTA-PADA

MOUDA MUNDULI

NANDOL PAD-HANSAH

I

PAN-CHA-GAN

PATA-PUR

PU-RUNATIGIRIA

RA-GADI-

PATANA

Total Sales

63000 334000 129000 48000 138000 39000 105000 262000 105000 275000

Dabur Sales

2600 27900 3500 300 16000 1200 3800 14100 4000 24500

HUL Sales

22500 111000 39000 17500 73800 13000 38000 65000 26000 86000

25000

125000

225000

325000

Village Wise Turnover

Sale

s per

Mon

th

The above charts indicate the comparison between village wise turnover (Total Turnover, Dabur Turnover, and HUL’s Turnover). From this it can be seen that villages such as Agarath, Berhampura, Gatiroutpatna, Kantapada, Patapur, and Ragadipatana have very high sales but in this villages sales of Dabur is not satisfactory.

6) COMPETITIVE ANALYSIS :

AGRAHAT

BALISAHI

BANARA

BERHAMPURA

BINISHPUR

GATIROUTP

ATNA

GOBRA

HARIRAJPUR

JAMADEIP

UR

KAITHA

KANHEIPUR

KANTAPADA

MOUDA

MUNDULI

NANDOL

PADHANSAHI

PANCHAGAN

PATAPUR

PURUNATIGIRIA

RAGADIPATANA

TOTA

L:-0

100000200000300000400000500000600000700000800000900000

1000000

Competitive Analysis Between Dabur & HUL

DABURHUL

The above chart displays the Competitive Analysis between turnovers of Dabur and HUL in rural market of Cuttack district.

It is seen that the turnover in rural market for Dabur and HUL are in the ratio 1:5

7) COVERAGE OF DABUR :

STOCKIEST SUB-STOCKIEST WHOLESALER

Series1 4 3 73

5

15

25

35

45

55

65

75

Mode of Coverage

No.

of O

utle

ts

The above chart shows the direct and indirect coverage of Dabur to the retailer in the rural market of Cuttack District. The bar graph shows that 73 outlets are covered by the wholesalers of nearby market,4 outlet by the stockiest, and 3 by the sub-stockiest.

So, it is necessary for Dabur to make a good distribution channel to have a direct coverage in this markets and give more focus on converting those wholesaler outlets to sub-stockiest outlets.

8) MODE OF TRANSPORTATION :

VAN ORDER BOOKING SELF

Series1 3 4 84

5

15

25

35

45

55

65

75

85

Mode of Transportation

No.

of O

utle

ts

In this graph the mode of transportation refers to the way in which Dabur products reach the outlets. The figures show that most of the outlets (i.e. 84 outlets) are not been touched by the sub-stockiest. So, the retailers have to make their own arrangements to get the products, this might be a reason for the low

Dabur Turnover in the rural market of Cuttack District. Further 3 outlets are covered by van and 4 through order booking.

It is beneficial to cover more outlets through stockiest and sub-stockiest as it might raise the Dabur Turnover in the rural market of Cuttack District.

9) AVAILABILITY OF DABUR PRODUCTS :

RED PASTE

RED POWDER

ANMOL

ANMOL(S)

VATIKA OIL

VATIKA SHAMPOO

HAJMOLA

HAJMOLA CANDY

HONEY

AMLA

CHAWANPRASH

LAL TAIL

GLUCOSE-D

PUDINHARA

GULABARI

BINACA

BABOOL

ODONIL

VATIKA SHAMPOO(S)

72

74

63

67

42

38

51

42

46

61

25

34

54

52

41

18

66

3

66

AVAILABILITY OF DABUR PRODUCTNo.of Outlet

The above chart shows the availability of Dabur products in different outlets of rural market in Cuttack District. The following interpretation has been done from the data collected. Most of the retail outlet having quite common running product like dabur red powder, red paste, amla, hajmola, hajmola candy, anmol oil, anmol oil sachet,

babool paste,vatika shampoo sachet. The dabur red powder is available in 74 outlets, dabur red paste is available in 72 outlets, anmol oil is available in 63 outlets, anmol oil sachet is available in 67 outlets, hajmola is available in 51 outlets, hajmola candy is available in 42 outlets, honey is available in 46 outlets, chawanprash is available in 25 outlets, gulabari is available in 41 outlets, pudinhara is available in 52 outlets, Glucose-D is available in 54 outlets, babool is available in 66 outlets, binaca is available in 18 outlets, lal tail is available in 34 outlets, vatika shampoo is available in 38 outlets, vatika shampoo sachet is available in 66 outlets, vatika oil is available in 42 outlets.

Lower turnover of Dabur in villages of Cuttack

Name of the village Sales of Dabur   Arad 1000Lunahar 2400Marthapur 1700Nuagan 3900Paschimakacha 3800Bindanima 4000Uradha 1000Praharajpur 3300Achalkota 3400Kusupangi 5800Kulgan-isahlo 1800   Agrahat 6080Balisahi 1000Binishpur 1800Gobra 3100Harirajpur 9600Jemadeipur 900Kaitha 1500Kahneipur 2600Mouda 3500Munduli 300Padhan sahi 1200Panchgan 3800Puruna tigiria 4000

Interpretation: As these villages have lower sales so there is an opportunity for Dabur India Ltd to penetrate the market and increase the turnover or sales. This can be done by introducing or appointing proposed sub stockiest as mentioned in the table given in the “Suggestion” section of the project report.

findings

Findings from Analysis: Out of 91 outlets surveyed only 74 have Dabur products. Dabur has not yet reached some of the villages, eg Munduli. Only 19 outlets have Dabur turnover more than Rs.1600. Few outlets have total turnover of above Rs.100000. It is found that villages like Agarath, Berhampura, Gatiroutpatna,

Kantapada, Patapur, Ragadipatna have high total turnover but, their Dabur turnover is not satisfactory.

The turnover ratio between Dabur & HUL is 1:5. (i.e. HUL’s total turnover is 5 times greater than that of Dabur.

Most of the outlets depend on wholesalers. (i.e. 80%) Stockiest do not cover the nearby area in which they are assigned. Availability of products is quite limited. Products like Odonil, Binaca Tooth Brush, Chawanprash are available in

very few outlets.

Retailers View: The retailers were of the opinion that products with cheaper price than

Dabur is eating up the market share. Low priced products can be more successful in rural market. The frequency of visit of sub-stockiest is very less. Sub-stockiest doesn’t visit all the outlets that fall in the same area of a

village. One retailer said “why would I bring dabur product if the van is coming to

our village and not coming to my shop, there are many substitute product in market”. This retailer bring its product from Cuttack wholesaler.

But the problem is that it’s not available in its nearest place, no substockist of dabur are there.

Irregularity of van.

recommendations

Each outlet of a village should be visited by sub-stockiest irrespective of its size. So that all outlets could be covered.

Allocation of sub-stockiest & stockiest should be done by proper analysis. As only few outlets have good Dabur turnover, it shows a big business

opportunity. This could be done by communication campaigns, to develop a lot of rural sensitivity for rural branding.

Outlets having total monthly turnover of Rs.100000 in villages could be approached for sub-stockiest.

As most of the outlets depend on wholesalers, the wholesalers should be asked to push the product to small retailers by giving them discounts & offers.

As most of FMCG products are low involvement products consumers cannot wait for days to purchase the product; hence it has to be on the shelf on present day especially in rural market.

Creation of awareness through various modes of advertisement. Come out with advertisement that are appealing and which portray the

originality of the product. Explain the advantages of the product over its competitors. Various attractive schemes involving prizes, lucky draws, special discounts

etc. should be brought into practice to lure the customers.Retailers Suggestion:

Increase the quantity. Come out with various schemes for retailers and customers. Provide display boards so that the product visibility is taken care of. To increase the discount rate.

PROPOSED SUB-STOCKIEST POINTS:

Dabur should open new sub-stockiest points to improve its reach. Binishpur and padhan sahi can be reached by the nearest sub stockiest of Niali. Balisahi, Mouda, Kaitha, Paschima Kacha can be reached by nearest

substockiest of Vinayak Trading of Salepur. As there are small outlet (SO) in the above mentioned villages the sub stockiest

is not supplying them Dabur Product.

Arad, Urali, Marthapur, Munduli is not so far from cuttack market. So it can be covered by cuttack market through van.

INTERPRETATION:

As suggested above in the table, if we could appoint a proposed sub stockiest in this villages then we would be able to cover many other villages.

By covering these villages which having less sales of Dabur, we can increase the availability and visibility of Dabur product as well as increase the presence of Dabur in Rural market.

conclusion

Proposed Sub-stockiest at this Villages

Can cover villages Sales of Dabur1)RAMGARH (i)Tangi Not under our area  ii) chatia Not under our area  iii) jagatpur Not under our area  iv) Mouda 3500  v) kahneipur 2600     2) Charbatia i) Agrahat 6080  ii) Sankarpur 36900  iii) Berhampur not under our area  iv) Similihanda not covered  v) Rampei not covered   vi) Gobara 31003) Tigiria i) Panchagan 3800  ii)Puruna tigiria 4000  iii)Achalkota 3400  iv)Bindanima 4000     4) Kusupangi i) Pathapur 11800  ii) Banara 11400  iii) Harirajpur 9600     5) Kandarpur i)Praharajpur 3300  ii)Mohammadpur not covered

Tomorrow’s great beneficiaries of change will be the fast learners, the agile movers. Those innovative companies those are able to anticipate changes earlier than others & take active measures to stay ahead.

Irrespective of whether the product applies to a vertical segmentation or cuts across sectors, serves a corporate customer or a wide consumer market, the golden rule is IT MUST SOLVE A PROBLEM THAT CUSTOMERS ARE FACING, NO MATTER WHO THE CUSTOMER IS.

In the end it is certain that FMCG companies will have to really gain inroads in the rural markets in order to achieve double digit growth targets in future. There is huge potential and definitely there is lot of money in rural India but the smart thing would be to weigh in the roadblocks as carefully as possible. The companies entering rural market must do so for strategic reasons and not for tactical gains as rural consumer is still a closed book and it is only through unwavering commitment that the companies can make a dent in the market. Ultimately the winner would be the one with the required resources like time and money and also with the much needed innovative ideas to tap the rural markets.

Bibliography

1) Marketing management By PHILIP KOTLER

2) Marketing Management By Rajan Saxena

3) Marketing Research By C.R.KOTHARI

Websites:

1) www.dabur.com

2) www.google.com

Annexure

questionnaireTo find new business opportunity in rural Orissa for Dabur India ltd.

1) District -………..…………………………

2) Village Name -…..……………………….

3) Population -………………………………

4) Name of the Outlet -…………………………………………………………….

5) Name & Address -……………………………………………………………….

…..…………………………………………………………...

6) Availability of Dabur (Yes/No) -…………………

7) Turnover of Dabur (if Yes) -……………………..

8) Turnover of HUL -………..……………………….

9) Turnover of others -...……………………………

10) Total Sales per Month –………………………..

11) Mode of Coverage -

a) Sub-Stockiest

b) Stockiest

c) Wholesaler

12) Covered by (name of the person) –……………………………………..

13) Covered from (name of the place) –..............................................

14) Mode of Transportation –

a) Order Booking

b) Van

c) Self

15) Brands Available - …………………………………………………………….

………………………………………………………..........

………………………………………………………………