ITC

Presented By -Avinash Singh

ABOUT THE COMPANY…

Diversified group of companies with operations in various industry segments from cigarettes to apparels.

Annual turnover is of the order US$2.4 billion

One of the largest retailing network in the country

Ranked 8th in the ET 500 survey.

Products –Cigarettes, hotels, apparels, paper, etc.

DISTRIBUTION NETWORK(Tobacco Div.)

Bangalore Bangalore Calcutta Calcutta Saharanpur Saharanpur Munger Munger

GODOWNS(19)

GODOWNS(19)

BRANCHES (19) BRANCHES (19)

Factories (4)

WHOLESALE DISTRIBUTORS(60 PER BRANCH)

WHOLESALE DISTRIBUTORS(PER BRANCH 60)

RETAILERSRETAILERS SECONDARYWHOLESALERS

SECONDARYWHOLESALERS

Information

Goods

Role of Each Member

Factories – Supply to 18 godowns Godowns & Branches

Manage by C&F agents getting monthly remuneration No rent paid by ITC one branch – 60 WDs , 5 AMs and 20 Area Executives

Wholesale Distributors(WDs) Margin – 2% of sales Appoints secondary Wholesalers

Role of Each Member

Retailers

Super MarketsHotels , Restaurants & CafesConvenience Dealers Grocery Stores

TERMS & CONDITIONS

WDs – Zero overnite credit basis

WD appointed supervisor monitor the performance of sales force

Primary expectation – no pilferage of cigarettes

MARKETING DECISIONS

Two Levels National level

Brand Managers in consultation with branch managers. National promotion plans- sponsorships & event organizations

Branch Level ( Two Decisions)– Local Promotions

– Small Level Promotions

PHYSICAL DISTRIBUTION

Demand Estimation – collaborative forecasting( Sales force with dealers)

Forecast based on last month sales Production plan made according to forecast Delivery to C & F agents within 7 days CFAs deliver goods to dealers on the basis of the branch

office route plan Factory CFAs- Trucks CFAs Dealers – Small Vehicles

FLOWS

Promotion flows No volume discounts to channel members No scope for cash discounts

Information Flow Main information source- Wholesalers ITC ERP system

FINANCIAL TRANSACTIONS

Zero day credit policy

Supplies are frozen till clearance of dues

Strict regime due to millions of retailers

Strong bargaining power for the company

PROBLEMS FACED by ITC CHAIN

1. Shortages in supply system Hoarding due to anticipation of a rise in excise duties on

cigarettes Creates artificial shortage Can be solved by stricter monitoring policy during the time

close to the budget

• Pilferage of stock during transportation Due to improper action of WDs Can be solved by timely reporting

Thank You