A PROJECT REPORT ON WHOLE SALE AND RETAIL PENETATION IN JAIPUR
MARKET FOR ITC FOOD PRODUCTS. REPORT
ON CRITICAL ANALYSIS FOR SANCTIONING TERM LOAN & WORKING
CAPITAL PROPOSAL. IN ORIENTAL BANK OF COMMERECE
IN PARTIAL FULFILLMENT IN AWARD OF PGDBM TWO YEARS FULL TIME
PROGRAMME
FACULTY GUIDE GUIDEE MRS RUBINA SAJIDVAISHALI SHARMA VASHISHT MR
PRAVEEN SHARMA
COMPANY MR.ANURAG
SUBMITTED BY
KHUSHBOO BACHHAWATRISHI MOHAN JOSHIPGDBM II SEMESTER
20062007-20098___________________________________________________________________
Maharishi Arvind Institute of Science & ManagementAmbabari
Circle, Bharti Path, Ambabari, Jaipur-302 023 INDIA. Tel:
+91-141-2335487, 2234216 - Telefax: +91-141-2335120 E-mail:
[email protected] ; [email protected]
ACKNOWLEDGEMENTWhenever, any project is completed along with it
comes a sense of satisfaction and achievement. Therefore, in
regards to the same it becomes extremely crucial to thank all those
people who have directly or indirectly helped in the successful
completion of the project. I would sincerely like to thanks Mr.
Ankur Chrturvedi (BRANCH MANAGER) and Mr.Anand Singh Bisht
(ASSISTANT BRANCH MANAGER) for providing me such a great honour and
opportunity to undertake summer training at ITC limited as a part
of the curriculum the PGDM programme. My sincere regards to Mr.
Anurag Vashishth (AREA EXCUTIVE) ITC Foods, Jaipur for giving me
proper guidance and support as and when needed. I would like to
thanks Mrs. Vaishali Sharma faculty guide MAISM, for the
cooperation and motivation & guidance to fulfill my summer
training report. I would like to place on record my sincere
gratitude to my project guide Mr.ANURAG. (ITC Ltd,) for giving me
support, guidance and opportunity to do my summer internship with
ITC Ltd, Gurgaon. I am deeply indebted to HR-Assistant Manager Ms.
Shagun Jaina whose help, stimulating suggestions and encouragement
helped me in all the time of research and writing of this project.
I have furthermore to thank Ms. Astha Sharma (HR Executive) for her
help, support, interest and valuable hints.
I would extend my thanks to Mrs.VAISHALI SHARMA, my faculty
guide at MAISM for the help and guidance and stimulating discussion
on different aspects for making the project.
I am obliged to my family who looked closely at the final
version of the project for English style & grammar, correcting
both and offering suggestions for improvement. Lastly and equally I
would like to extend my thanks to my entire sales force for the
support, specially Mr. Anil Shipra (WD, MDCL) who has taken
interest in the successful completion of the to allproject. I will
always be obliged to all my well wishers who have directly or
indirectly supported me in the completion of my Internship program.
faculty members and batch mates and all individuals whoever
supported me in fulfillment of this project. Thanking you, Yours
Sincerely, (RISHI MOHAN JOSHI)
EXECUTIVE SUMMARYBusiness organizations today are facing growth,
competition and challenges as the economy is growing. The growth
and downfall of the company, depends on many aspects. Marketing is
one of them. how it uses its resources. Human Resources is one of
the most important and talked about resources in todays corporate
world, human being unlike other resources can think, feel, express
their feelings and response to the ways that they are being
treated. Therefore having the right kind of people to do the job is
very important to the organization today. Organization today are
looking for those people who are very
sincere at their work and who possesses adequate knowledge,
skills and efficiency to perform the work that is given to them.
This project workinternship isprogramme is a part of 2 year course
of PGDM which includes both the project work as well as training.
As the project given was in the field of marketing and it was
about. Whole sale and Retail Penetration. My study was concerned to
understand the whole sellers. To check the availability and to
increase the sales of ITC products in the Retail market. My
training started with the market mapping which was to develop the
basic understanding of Food products regarding the percentage of
margin offered to the retailers, scheme offerings, working of
supervisors & DS, product delivery etc,. The next phase of my
training included exploring of companys products in the existing
market. I worked with the sales team in the field to increase the
sales of ITC Foods. I worked on the motivation and problem creating
areas of the sales team which helped in increasing productivity of
the sales team and this indeed boosted the sales.
I visited the market, collected data for my project and
convinced the raw market to get along with ITC. I developed my
understanding on the various aspects in which my company guide
turned up as a true mentor.
CERTIFICATE
This is to certify that Mr. Rishi Mohan Joshi of PGDM II
semester of session 2007-2009 has completed his project work as per
the requirement of PGDM programme of MAISM, Ambabari, Jaipur. He
has done his project on whole sale and retail penetration for ITC
Food products in Jaipur under my guidance. The work is done only
for academic purpose. I am fully satisfied with his work and
recommend its acceptance in the partial fulfillment of the
requirements for the award of PGDM COURSE. I wish him all the
success. Vaishali sharma (FACULTY GUIDE)MAISM, Jaipur
MBA MARKETING from Maharishi Arvind Institute of Science and
management, Jaipur. To incorporate productivity it is important
that the organization should have right kind of people at the right
time for right kind of job. Therefore to acquire the best from
among the best, the effectiveness of the recruiting process of the
company plays a vital role. Manpower in an organization refers to
the Human Resource employed in any enterprise. Manpower resource is
the most vital factor for the survival and prosperity of a firm.
An
efficient management will always think of developing adequate
talent for various positions in the organization and therefore
adopt a well- planned recruitment strategy. There is no scarcity of
workforce in India but to find proficient and technically sound
people is a problem for all the companies. Growth and development
largely depends on its workforce therefore all the companies make
special effort to have their specialized team of recruiters to
recruit the most potential staff.
The philosophy of attracting as many applicants as possible for
given jobs guided recruitment activities in the past. These days
the emphasis is on matching the needs of the organization to the
needs of the applicants. This would minimizes employee turnover and
enhance satisfaction .
T
TABLE OF CONTENTS1. Introduction to IndustryBanking..
1
2. Introduction to the company.... 134. Project Profile
3
3. Overview of FMCG Foods SME BANKING.
5. Title of the study. Objectives of the study Research
methodology a. Universe. b. Sampling Technique.. c. Research Design
d. Limitation of the study.. 6. Data and Data Analysis 7.
Conclusions & Suggestions. 8. Annexure..9. Bibliography.
34 34
39 40 40 43 44 46 48 50
INTRODUCTION TO THE INDUSTRY
The Indian FMCG sector with a market size of US$13.1 billion is
the fourth largest sector in the economy. A well-established
distribution network, intense competition between the organized and
unorganized segments characterize the sector. FMCG Sector is
expected to grow by over 60% by 2010. That will translate into an
annual growth of 10% over a 5-year period. It has been estimated
that FMCG sector will rise from around Rs 56,500 crores in 2005 to
Rs 92,100 crores in 2010. Hair care, household care, male grooming,
female hygiene, and the chocolates and confectionery categories are
estimated to be the fastest growing segments, says an HSBC report.
Though the sector witnessed a slower growth in 2002-2004, it has
been able to make a fine recovery since then.For example, Hindustan
Levers Limited (HLL) has shown a healthy growth in the last
quarter. An estimated double-digit growth over the next few years
shows that the good times are likely to continue.
GrowthProspectsWith the presence of 12.2% of the world
population in the villages of India, the Indian rural FMCG market
is something no one can overlook. Increased focus on farm sector
will boost rural incomes, hence providing better growth prospects
to the FMCG companies. Better infrastructure facilities will
improve their supply chain. FMCG sector is also likely to benefit
from growing demand in the market. Because of the low per capita
consumption for almost all the products in the country, FMCG
companies have immense possibilities for growth. And if the
companies are able to change the mindset of the consumers, i.e. if
they are able to take the consumers to branded products and offer
new generation products, they would be able to generate higher
growth in the near future. It is expected that the rural income
will rise in 20087, boosting purchasing power in the countryside.
However, the demand in urban areas would be the key growth driver
over the long term. Also, increase in the urban population, along
with increase in income levels and the availability of new
categories, would help the urban areas maintain their position in
terms of consumption. At
as present, urban India accounts for 66% of total FMCG
consumption, with rural
India accounting for the remaining 34%. However, rural India
accounts for more than 40% consumption in major FMCG categories
such as personal care, fabric care, and hot beverages. In urban
areas, home and personal care category, including skin care,
household care and feminine hygiene, will keep growing at
relatively attractive rates. Within the foods segment, it is
estimated that processed foods, bakery, and dairy are long-term
growth categories in both rural and urban areas. Indian
Competitiveness and Comparison with the World Markets
The following factors make India a competitive player in FMCG
sector: Availability of raw materials
Because of the diverse agro-climatic conditions in India, there
is a large raw material base suitable for food processing
industries. India is the largest producer of livestock, milk,
sugarcane, coconut, spices and cashew and is the second largest
producer of rice, wheat and fruits &vegetables. India also
produces caustic soda and soda ash, which are required for the
production of soaps and detergents. The availability of these raw
materials gives India the location advantage. Labor cost
comparison
Low cost labor gives India a competitive advantage. India's
labor cost is amongst the lowest in the world, after China &
Indonesia. Low labor costs give the advantage of low cost of
production. Many MNC's have established their plants in India to
outsource for domestic and export markets. Presence across value
chain Indian companies have their presence across the value chain
of FMCG sector, right from the supply of raw materials to packaged
goods in the food-processing sector. This brings India a more cost
competitive advantage. For example, Amul supplies
milk as well dairy products like cheese, butter, etc
.
We believe that in a scenario of a buoyant economy and multiple
growth triggers being in place, the FMCG sector should sustain
robust growth momentum. We expect new product developments, better
health and happier taste buds in the FMCG sector.
Momentum to sustain: With India rising, the outlook of Indians
is changing too. They are willing to experiment and try out new
products. Capturing insights into their needs and synthesising
these into strategies and final product formats presents a new
opportunity for FMCG players. Having witnessed robust growth over
the last couple of years, we believe the growth would continue
being strong. Up gradation from unbranded to branded goods
(packaged grocery, household cleaning products), demand of nascent
categories (breakfast cereals, hair colours) and health and hygiene
products (chyavanprash) would be the growth drivers. Going rural:
As per Asschom, FMCG will be witnessing more than 50% of its growth
in the rural and semi-urban segments by 2010. Currently, nearly 34%
of the offtake of FMCG companies come form rural areas. As seen in
the last year, even in 2008, the rural areas would provide a huge
potential. Companies like HUL, ITC and Colgate have already
established good distribution networks in these regions. Other
companies would start catering to these regions in near future.
Health and wellness: With the growth prospects of the economy and
sector in place, though most of the categories will continue their
growth, processed foods and the Personal Care segment is likely be
the fastest growing segments.
Foods: Food forms the largest component of the total consumption
expenditure in India accounting for as much as 51%. This is highest
compared to 9.7% for an average American person and 15% for both
Japanese and British. Though with rising income, the share would go
down, but would increase in absolute terms. Further, the companies
are widening their health food portfolio to target the rich, health
conscious urbans. Dabur, HUL and ITC have made investments in this
segment. Personal Care Products: Consumer spending India on
personal care products is very less. Further, the penetration
levels are low too. With growing urbanisation and higher disposable
incomes, consumers are now spending higher on personal care
products. Higher growth is seen in premium range of such products.
While rural areas will drive the growth of mass consumption
products, urban consumers will be targeted for the premium
segments.
Value growth: Along with volume growth we expect the value
growth to be strong too. The companies would take selective hikes
in price to meet the inflationary pressure. Also the consumers
would upgrade from mass brands to premium brands, which would be a
key driver in the value growth.
Retail formats- boom or bane: India is witnessing a retailing
revolution in recent times. While some retail chains are of large
retail formats enabling huge volumes, some are focused on
affordability and thereby squeezing the margins. The Indian market
is dominated by more than 12 m small mom and pop retail outlets.
However only 4% is in the organised sector, thereby reducing the
reach. With FDI expected to be allowed, the share from the retail
formats by the FMCG players is expected to increase. Cut- throat
competition: FMCG companies continue to face intense competition.
Players from unorganized and organized sectors continue to grab
each others market shares. Highly scattered market and poor
transport infrastructure limits the ability of MNCs and national
players to reach out to remote rural areas and small towns. Low
brand awareness enables local players to market their spurious
lookalike brands. Also with entry of existing players in new
segments like ITCs entry in personal care products, Daburs plans to
venture into health beverages would add to the already aggressive
environment resulting in high pressure on margins. Commodity
prices- a key risk: A worsening of the commodity price environment
is a key risk. In 2007, most of the companies had faced pressure on
its input prices. Crude, palm oil, wheat and packaging costs were
on a rise. Though most of the companies had taken judicious price
increases, however, a sustained inflationary environment could hurt
growth or margins or both. Margin expansion to slow: While we
expect the revenue growth to be strong, the overall margin
expansion would slow down in the coming year. Though the price hike
effected by the companies will partly camouflage inflationary
pressures, we expect margin expansion to slow down. With increasing
competition, the companies have to spend higher amounts on the
promotion, distribution and advertising of the products. Further,
the savings on account of tax holidays would decline going forward
leading to pressure on margins. With the economy on a high growth
flight, robust consumerism, greater rural penetration and rapidly
growing organized retail, we remain bullish over the growth
traction in the FMCG space. While rural regions would drive
consumption due to higher penetration, organized retailing in urban
markets would help increase value growth led by demand of premium
products. The shift from unorganized to organized and from
unbranded to branded will add further impetus to growth in this
segment. India's immense population of one billion-plus people
offers tremendous market potential. But its many languages, size
and poor infrastructure can make it a difficult place to operate.
The companies will have to align its
strategies as per the changing environment, attitudes and
preferences of the customers to be successful. Commodity prices
have been spiraling in recent times. Not only crude oil prices, but
also prices of wheat, palm oil, milk and metals are making new
highs. Even petroderivatives such as high-density polyethylene
(HDPE), used for packaging material, have become more costly. The
rising crude prices and skyrocketing input costs have led the fast
moving consumer goods (FMCG) companies to make items of daily
consumption costlier by increasing their maximum retail prices
(MRPs). In this article we shall discuss the impact of the rising
input costs on the FMCG companies and their consumers. We have
taken the companies from the BSE FMCG index under consideration.
They are present in different segments such as biscuits, tea,
chips, chocolates, healthcare & hygiene products and beverages
both alcoholic and non-alcoholic. At the company level: Costs Some
of the common raw materials needed for the production of FMCG
products include wheat flour (biscuits), palm oil (soaps), tobacco
(cigarettes), dairy products, sugar, salt, coffee, tea, cocoa
(chocolates), barley (beer), malt/alcohol (spirits) and HDPE
(packaging). Below are examples of increase in costs of some of
these key inputs over the past three years (CY05 to CY07). Inputs
Coffee Tea Oils, fats and rosins Chemicals and perfumes Fresh milk
and milk concentrate Green coffee Vegetable oils Skimmed milk
powder Wheat flour Sugar Milk power Liquid milk Malt and malt
extract Flour (wheat) Increase (%) 25.1% 21.0% 16.5% 14.9% 24.2%
68.6% 25.0% 46.4% 37.1% -16.8% 53.1% 40.5% 27.0% 40.8% Source HUL
HUL HUL HUL Nestle Nestle Nestle Nestle Nestle Nestle GSK CH GSK CH
GSK CH GSK CH
In the adjacent graph, we have
taken the average raw material cost (as percentage of sales) and
gross margins of the companies. As we can see, the gross margins
and the raw material costs (as a percentage of sales) have an
indirect relation. Since FY05, there has been a gradual decline in
their average gross margins due to rising input prices. Apart from
rising inputs costs, the other main reason for this decline is the
highly competitive nature of this sector. This has directly
affected the companies pricing powers. The companies have not been
able to pass on the rising costs to their customers, as it would
affect the volumes of the respective products. An example of the
same would be of Britannias FY07 result. Due to the rise in wheat
prices (flour is used in biscuits) the companys EBIDTA margins
dropped to levels of 6% from 12% in the previous year. Another
classic case would be the declining pricing power of HUL due to
increased competition along with high input costs. Though the
companies had taken price hikes in recent quarters to offset the
hike in raw material prices, going forward further increase in the
final product prices may be not easy as it may lead to lower
volumes and losing market share.
As seen from the adjoining chart, except for sugar, all the
household products (MRPs of products from the major companies in
the respective segments) have seen a steep rise over the past two
and a half years. The price of wheat flour has gone up by 44%,
while that of edible oil rose by 65% over the past two and a half
years. Even tea and coffee prices have witnessed a jump by nearly
14% and 25% respectively over the same period. Clearly, there are
tough times ahead for the ordinary consumer.
INTRODUCTION TO THE CONPANY
ITC was incorporated on August 24, 1910 under the name of
'Imperial Tobacco Company of India Limited'. Its beginnings were
humble. A leased office on Radha Bazar Lane, Kolkata, was the
centre of the Company's existence. The Company celebrated its 16th
birthday on August 24, 1926, by purchasing the plot of land
situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata,
for the sum of Rs 310,000. This decision of the Company was
historic in more ways than one. It was to mark the beginning of a
long and eventful journey into India's future. The Company's
headquarter building, 'Virginia House', which came up on that plot
of land two years later, would go on to become one of Kolkata's
most venerated landmarks. The Company's ownership progressively
Indianised, and the name of the Company was changed to I.T.C.
Limited in 1974. In recognition of the Company's multi-business
portfolio encompassing a wide range of businesses - Cigarettes
& Tobacco, Hotels, Information Technology, Packaging,
Paperboards & Specialty Papers, Agri-Exports,
Foods, Lifestyle Retailing and Greeting Gifting & Stationery
- the full stops in the Company's name were removed effective
September 18, 2001. The Company now stands rechristened 'ITC
Limited'. Though the first six decades of the Company's existence
were primarily devoted to the growth and consolidation of the
Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the
beginnings of a corporate transformation that would usher in
momentous changes in the life of the Company. ITC's Packaging &
Printing Business was set up in 1925 as a strategic backward
integration for ITC's Cigarettes business. It is today India's most
sophisticated packaging house. In 1975 the Company launched its
Hotels business with the acquisition of a hotel in Chennai which
was rechristened 'ITC-Welcomgroup Hotel Chola'. The objective of
ITC's entry into the hotels business was rooted in the concept of
creating value for the nation. ITC chose the hotels business for
its potential to earn high levels of foreign exchange, create
tourism infrastructure and generate large scale direct and indirect
employment. Since then ITC's Hotels business has grown to occupy a
position of leadership, with over 70 owned and managed properties
spread across India. In 1979, ITC entered the Paperboards business
by promoting ITC Bhadrachalam Paperboards Limited, which today has
become the market leader in India. Bhadrachalam Paperboards
amalgamated with the Company effective March 13, 2002 and became a
Division of the Company, Bhadrachalam Paperboards Division. In
November 2002, this division merged with the Company's Tribeni
Tissues Division to form the Paperboards & Specialty Papers
Division. ITC's paperboards' technology, productivity, quality and
manufacturing processes are comparable to the best in the world. It
has also made an immense contribution to the development of
Sarapaka, an economically backward area in the state of Andhra
Pradesh. It is directly involved in education, environmental
protection and community development. In 2004, ITC acquired the
paperboard manufacturing facility of BILT Industrial Packaging Co.
Ltd (BIPCO), near Coimbatore,
Tamil Nadu. The Kovai Unit allows ITC to improve customer
service with reduced lead time and a wider product range. In 1985,
ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British
joint venture. Since inception, its shares have been held by ITC,
British American Tobacco and various independent shareholders in
Nepal. In August 2002, Surya Tobacco became a subsidiary of ITC
Limited and its name was changed to Surya Nepal Private Limited
(Surya Nepal). In 1990, ITC acquired Tribeni Tissues Limited, a
Specialty paper manufacturing company and a major supplier of
tissue paper to the cigarette industry. The merged entity was named
the Tribeni Tissues Division (TTD). To harness strategic and
operational synergies, TTD was merged with the Bhadrachalam
Paperboards Division to form the Paperboards & Specialty Papers
Division in November 2002. Also in 1990, leveraging its
agri-sourcing competency, ITC set up the Agri Business Division for
export of agri-commodities. The Division is today one of India's
largest exporters. ITC's unique and now widely acknowledged
e-Choupal initiative began in 2000 with soya farmers in Madhya
Pradesh. Now it extends to 9 states covering over 4 million
farmers. ITC's first rural mall, christened 'Choupal Saagar' was
inaugurated in August 2004 at Sehore. On the rural retail front, 24
'Choupal Saagars' are now operatonal in the 3 states of Madhya
Pradesh, Maharashtra and Uttar Pradesh. In 2000, ITC launched a
line of high quality greeting cards under the brand name
'Expressions'. In 2002, the product range was enlarged with the
introduction of Gift wrappers, Autograph books and Slam books. In
the same year, ITC also launched 'Expressions Matrubhasha', a
vernacular range of greeting cards in eight languages and
'Expressions Paperkraft', a range of premium stationery products.
In 2003, the company rolled out 'Classmate', a range of notebooks
in the school stationery segment. ITC also entered the Lifestyle
Retailing business with the Wills Sport range of international
quality relaxed wear for men and women in 2000. The Wills
Lifestyle
chain of exclusive stores later expanded its range to include
Wills Classic formal wear (2002) and Wills Clublife evening wear
(2003). ITC also initiated a foray into the popular segment with
its men's wear brand, John Players, in 2002. In 2006, Wills
Lifestyle became title partner of the country's most premier
fashion event - Wills Lifestyle India Fashion Week - that has
gained recognition from buyers and retailers as the single largest
B-2-B platform for the Fashion Design industry. To mark the
occasion, ITC launched a special 'Celebration Series', taking the
event forward to consumers. In 2007, the Company introduced 'Miss
Players'- a fashion brand in the popular segment for the young
woman. In 2000, ITC spun off its information technology business
into a wholly owned subsidiary, ITC Infotech India Limited, to more
aggressively pursue emerging opportunities in this area. Today ITC
Infotech is one of Indias fastest growing global IT and IT-enabled
services companies and has established itself as a key player in
offshore outsourcing, providing outsourced IT solutions and
services to leading global customers across key focus verticals -
Manufacturing, BFSI (Banking, Financial Services & Insurance),
CPG&R (Consumer Packaged Goods & Retail), THT (Travel,
Hospitality and Transportation) and Media & Entertainment.
ITC's foray into the Foods business is an outstanding example of
successfully blending multiple internal competencies to create a
new driver of business growth. It began in August 2001 with the
introduction of 'Kitchens of India' ready-to-eat Indian gourmet
dishes. In 2002, ITC entered the confectionery and staples segments
with the launch of the brands mint-o and Candyman confectionery and
Aashirvaad atta (wheat flour). 2003 witnessed the introduction of
Sunfeast as the Company entered the biscuits segment. ITC's entered
the fast growing branded snacks category with Bingo! in 2007. In
just six years, the Foods business has grown to a significant size
with over 200 differentiated products under six distinctive brands,
with an enviable distribution reach, a rapidly growing market share
and a solid market standing. In 2002, ITC's philosophy of
contributing to enhancing the competitiveness of the
entire value chain found yet another expression in the Safety
Matches initiative. ITC now markets popular safety matches brands
like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro. ITC's foray
into the marketing of Agarbattis (incense sticks) in 2003 marked
the manifestation of its partnership with the cottage sector. ITC's
popular agarbattis brands include Spriha and Mangaldeep across a
range of fragrances like Rose, Jasmine, Bouquet, Sandalwood,
Madhur, Sambrani and Nagchampa. ITC introduced Essenza Di Wills, an
exclusive range of fine fragrances and bath & body care
products for men and women in July 2005. Inizio, the signature
range under Essenza Di Wills provides a comprehensive grooming
regimen with distinct lines for men (Inizio Homme) and women
(Inizio Femme). Continuing with its tradition of bringing world
class products to Indian consumers the Company launched 'Fiama Di
Wills', a premium range of Shampoos, Shower Gels and Soaps in
September, October and December 2007 respectively. The Company also
launched the 'Superia' range of Soaps and Shampoos in the
mass-market segment at select markets in October 2007 and Vivel De
Wills & Vivel range of soaps in February and Vivel range of
shampoos in June 2008.
MISSION AND VISSION OF THE COMPANY
CORE VALUES OF THE COMPANY
ITC's Core Values are aimed at developing a customer-focused,
high-performance organisation which creates value for all its
stakeholders: Trusteeship As professional managers, we are
conscious that ITC has been given to us in "trust" by all our
stakeholders. We will actualise stakeholder value and interest on a
long term sustainable basis. Customer Focus We are always customer
focused and will deliver what the customer needs in terms of value,
quality and satisfaction. Respect For People We are result
oriented, setting high performance standards for ourselves as
individuals and teams. We will simultaneously respect and value
people and uphold humanness and human dignity.
We acknowledge that every individual brings different
perspectives and capabilities to the team and that a strong team is
founded on a variety of perspectives. We want individuals to dream,
value differences, create and experiment in pursuit of
opportunities and achieve leadership through teamwork.
Excellence We do what is right, do it well and win. We will
strive for excellence in whatever we do. Innovation We will
constantly pursue newer and better processes, products, services
and management practices. Nation Orientation We are aware of our
responsibility to generate economic value for the Nation. In
pursuit of our goals, we will make no compromise in complying with
applicable laws and regulations at all levels
Introduction to the ProjectITCs food brands Sun feast,
Aashirwad, Candy man, Kitchen of India are the most widely
distributed and consumed brands across India. The Sun feast range
consists of Glucose Biscuits, Cookies, Pasta, Chilli and Salted
Biscuits etc,. Aashirwad family includes Aata, Salt, Spices,
Instant mix, Cooking Paste. Kitchen of India includes Ready to eat
vegetables, deserts, chutney and conserves. In confectionary
business Candy man and Mint-o provides a wide range, colors, and
flavour of candies. To study and understand the whole sale and
retail market of ITC Foods in Jaipur for ITC owned products and to
find out the methods to boost up the sales of ITC foods and ways to
increase to whole sale market and the availability and visibility
of ITC food products. And to motivate and assist the sales team in
there day to day working.
PROJECT PROFILETitle of the project: Study on whole sale and
retail market of ITC Foods in Jaipur.
Objective of the projectMarketing Research is a systematic
collection, analysis, interpretation and reporting marketing
managers to solve some marketing problems. This particular research
study was undertaken and designed with some predetermined
objectives. The main objective of the study is to understand the
market and to check availability & delivery and the market
share of ITC Foods in various outlets and in the whole sale market.
The objective of the study is the analysis of availability of the
ITC foods and to increase the coverage and to improve the services
in the present outlet and also to find out good practices that
helps in more coverage , improved services and increases the sales
of ITC Foods. And also to find out possible problems that are
currently faced by the distributor, whole seller, retailer an,d the
sales and delivery team. To find out best possible ways to sort out
the problems and to achieve the sales target. Aand to increase the
number of whole sellers in the existing list,and make the existing
whole sellers stronger.
DISTRIBUTION CHANNEL OF ITC LIMITEDMANUFACTURERMANUF ACTURING
UNIT
HUB
DEPOTWAREH OUSE
__________________________________________________________________
STOKIESTW
STOKIESTW
STOKIESTW
STOKIESTW
WHOLESELLER1
Stock Carrying Point WHOLESELLER
__________________________________________________________________RETAILER
RETAILER RETAILER RETAILER
__________________________________________________________________
`
CONSUMER
PROJECT FLOWThe duration of the project was two months and the
periods wasperiod was divided into 76 weeks. WEEK 1Market mapping
was done according to the beat plan in the various out let to check
the availability and visibility of ITC food products Market mapping
was done according to.
WEEK 2Working with the supervisor and the sales force of the
concerned distributor in the area of Banipark and Ambabari.
WEEK 3Working with the supervisor and the sales force of the
concerned distributor in the area of Shastri nagar and Housing
board colony.
WEEK 4Working with the supervisor and the sales force of the
concerned distributor in the area of Vishwakarma industrial area
and Harmara.
WEEK 5Working with the supervisor and the sales force of the
concerned distributor in the area of Murlipura and Murlipura
scheme.
WEEK 6Working with the supervisor and the sales force of the
concerned distributor in the area of Vidhyadharnagar WEEK 7
Analysis of data & of information collected and preparation of
report.
Scope and Significance of the Research
ScopeResearch was carried out is Jaipur from 16th May to 30th
July 2008.Research examine the relationship between market size and
research productivity in the FMCG Food Sector. Using detailed
internal market facts, we find that larger research efforts are
more productive, not only because they enjoy economies of the
scale, but also because they realize economies of scope by
sustaining diverse portfolios of research projects that capture
internal and external knowledge spillovers.
SignificanceTo the company Can be used by the company for its
Research & Development works. It may be further used as a tool
for future course of action. The strategic part of the company may
be utilized for strengthening and betterment of existing working
pattern.
To the Researcher For academic purpose. To get practical
exposure. To understand the FMCG FOOD sector in deep.
SWOT ANALYSIS Strength Best quality of material used. Has
complete variety. Has strong brand awareness. Has a very strong
distribution network.
Weakness Always in short of supply.
Opportunity A variety of new products could be added to touch
the raw market. Rural market can be covered very easily.
Threats As the company is new in the industry it faces
competition by the older player who offers extra discount to the
market. Faces competition from the local player. Increasing cost
due to inflation.
Four Ps AnalysisMarketing Mix decisions must be made for
influencing the trade channels as wells the final consumer. The
company preparing an offering mix of product services and prices
and utilizing the communications mix advertising sales promotions
events and experiences public relations direct marketing and
personnal selling to reach the trade channels and the targeted
customers
Marketing MixProduct ITC Foods has a wide range of quality
products. Attractive & quality packaging. Well established
diversified branding. Well designed distribution network.
Price
Competitive pricing. Discount scheme through out the year.
Credit period of 7 days.
Place
Out let coverage of ITC is around ITC food products are
available in almost every outlet.
Promotion
Well skilled sales force. Advertisements on all T.V. channels.
Sales promotion activities are organized frequently through out the
year.
RESEARCH METHODOLOGYResearch Methodology is the way to
systematically solve the research problem. It may be understood as
a science of studying how research is done scientifically. In it
the researcher studied the various steps that are generally adopted
by the researcher in his research problem along with the logic
behind them. It is necessary for the researcher to know not only
the research method but also the methodology. Researcher not only
talk off research method but also consider the logic behind the
methods. The use of conduct of the research study and explain why
the research is using a particular matter for technique and why the
researcher is using others. So those research study results are
capable for being well evaluated by others.
UNIVERSE50 WHOLE SELLERS 750 RETAILERS OF ITC WERE VISITED.
*SIZE: *AREA: 20 WHOLESELLERS +750 retailers Jaipur
SAMPLING TECHNIQUERANDOM SAMPLING: In random sampling, each of
the population has a definite reassigned probability of being
selected in the sample. CONVINIENCE SAMPLING: The researcher has
done sampling according to his convenience in regards to place,
timing, and availability.
RESEARCH DESIGNResearch DesignIt is the arrangement of
conditions for collection & analysis in a manner that aims to
combine relevance to the research purpose with economy in
procedure.
RESEARCH INSTRUMENTSA complete questionnaire is prepared on the
basis of availability of ITC products .
DATA COLLECTIONSince the study, undertaken by the researcher is
a descriptive one, the researcher has concentrated on the primary
data through survey and collection secondary data.
SOURCE OF DATA COLLECTIONData is collected from two methods:
Primary data: The questionnaire for data collection according to
the information required from the consumes was designed. The region
undertaken for the research is Jaipur. Different areas selected for
collection of data through questionnaire.
Secondary data: it is collected from books, newspaper, magazine
and websites.
Limitation of the StudyEvery research has its own limitations.
It is not possible that a research is accomplished without having
any bindings and limitations. There are always some shortcomings
which comes into the way of the accomplishment of a particular
research study. It is almost impossible for the researcher to get
away from it. In the particular research, the study duration was
limited to a time of few weeks. So having a limited time span the
researcher has to collect information subject to the availability
of various sources i.e. retailers, dealers etc, as the research
study provides me and insight into the market share of ITC FOODS
with regard to the competitions it suffers from various
limitations.
Limitations Some times the whole seller does not reveal the
correct information so biases come. The scope of the study is
limited to the whole sellers & Retailers of Jaipur. Thus
confined to this city only and is not universal applicable.
Sometime the whole sellers & Retailers do not like to waste
time in giving the reply. Human error factor is always involved as
a basic limitation in study. The objective of the project was very
limited therefore it was not possible to go in details in many
aspect market and consumer satisfaction. The study is limited to
Jaipur.
Monthly turnover of the whole seller
%
20%lacs than 15 lacs
40% 10%
les s than 5 lac s 5 lac s to 10 lac s 10 lac s to 15 lac s m
ore than 15 lac s
30%
20%
40% 10%
les s than 5 lac s 5 lac s to 10 lac s 10 lac s to 15 lac s m
ore than 15 lac s
30%Analysis :shows that 40% most of the business is generated
from the whole seller whose monthly turnover is less than 5
lacs.
Major selling category
ry
MAJOR SELLING CATEGORY45 40 35 PERCENTAGE 30 25 20 15 10 5 0
CATEGORY NAME BISCUITS CONFECTIONARY TABACCO OTHERS
Analysis :-shows that the major selling category of in the
market is Tobacco and the second seat is occupied by Biscuits after
that there are many categories but tobacco occupies the major
market share that is 40%.
The brands in which the whole sellers dealMarket share of
Sunfest in Biscuits
BRANDS OF BISCUIT
OTHERS 15% PARLE 35% BRITANNIA 20%PARLE SUNFEAST BRITANNIA
OTHERS
SUNFEAST 30%
B R A N D S O F B IS C U IT
O TH E R S 15% P A RLE 35% B R IT A N N IA 20% P A RLE SUNFE AST
B R IT A N N IA O TH E R S SUNFEAST 30%
B R A N D S O F B IS C U IT
O TH E R S 15% P A RLE 35% B R IT A N N IA 20% P A RLE SUNFEAST
B R IT A N N IA O TH E R S SUNFEAST 30%
As per aAnalysis:- Parle is the brand which is most in demanded
brand the most and ITC has increased its market share where as
market share of Britannia is shrinkingcovers 35% of the total cover
available and Sunfeast covers 30% of the market..
CONFECTIONARY BRANDS Others
others Nestle the whole sellers ITCcandyman The brands in which
Candy manCadbury deal in confectionary 10% 20% 10% Nestle
cadbury Cadbury 15% 10%
nestle Others 10% 15%
perfeitte ITC 20% 10%
Perfeitte candyman 35% parle Parle CONFECTIONARY BRANDS
perfeitte parle Perfeitte 10% nestle 35% Parle I TC cadbury
CONFECTIONARY BRANDS others others candyman 10% 10%
cadbury 15%
candyman parle perfeitte
nestle 10%
parle 35%
nestle cadbury others
perfeitte 20%
Others 10% Cadbury 15%
Itc 10%
Itc
Pa
PeParle 35%
Ne
Nestle 10%
Ca
Oth
Perf eitte 20%
ANALYSIS:as per the figure and analysis parle leads the market ,
with in 3 years of time itc managed to capture 10% of the
market
Demand of Sunfeast Biscuit
more 10 lacs to 15 5 lacs to 10 lacs less than 5 lacs
20% 10% 30% 4
FIT K IT 1%
CO OK IE S 25%
FIT K IT CO O K IE S CRE A M CO CONUT S NA CK Y
G LUCO S E 39%
M A RIE LITE 1% S NA CK Y 9%
CRE A M 15% CO CO NUT 10%
M A RIE LITE G LUCO S E
1% 4% 11% 1% 4% 36% 1% NICE GLUCOS E FIT K IT CO OK IE S DRE A M
CCRE A M 19% 1% 22% S NA CK Y M A RIE LITE CO CO NUT
M ID P RICE CRE A M
GO LDE N B A CK E RY
Analysis :it is clear that the demand of sun feast glucose
biscuit is more in the market which means that glucose biscuit is
the best seller in the sun feast family then is cookies, cream,
coconut
F R U ITY F U N 15% C O F F E E TIN O 10% L IC K S 5% M ANGO 5%
M IN TO F R E S H 25% E C L A IR S 40%
PRODUCT WISE DEMAND OF ITC CONFECTIOARY
MINTO 25%
ASSORTED 20% LICKS 5%
TOFFEE 10% ECLAIRS 40%
Analysis :- clair has the highest demand among the
confectionaryproducts of ITC followed by mint-o fresh in the mint
segment.
SCHEME PREFERENCE
10 8 6 4 2 0 1 WHOLE SELLERS CONSUMER RETAILER NO PREFERENCE
ANALYSIS:Shows that consumer scheme are preferred in the market
by the whole sellers due to higher demand of that product.
SERVICE SATISFACTION LEVEL300 250 200 150 100 50 0 HIGHLY
SATISFIED Series1 300 SATISFIED 195 LESS SATISFIED 170 NOT
SATISFIED 85
ANALYSIS:shows that percentage of highly satisfied retailers was
highest
QUALITY SATISFACTION
400 350 300 250 200 150 100 50 0 22 POOR GOOD BETTER 90 263
375
EXCELLENT
ANALYSIS-: shows that quality of ITC products were found
excellent
CONCLISION ITC holds second position in the branded biscuit
segment in Jaipur. Sun feast glucose is the best seller in biscuit
segment of ITC products. Consumer schemes are more preferred in the
market then retailer schemes. Being fresher in the confectionary
market ITC managed to capture around 10 % of market share in the
branded confectionary. clairs is the best seller in ITC
confectionary business. Most of the retailers and whole sellers
were satisfied by the companys services. Quality of ITC Food
products are highly accepted in the market. ITC has a very strong
distribution channel.
SUGGESTIONS The coverage of outlets by the distributor salesman
should be increased. Motivation of the distributor salesman should
be done. Supervisor should call meeting of the distributor salesmen
twice a week to take the review & to decide further strategy.
Aggressive & innovative schemes should be made. Schemes should
be according to the demand of the whole seller & retailer. Some
special programs should be launched to bind the whole sellers &
the retailers for a long time with the company. Company should stay
in touch directly with the retailer by sending them greeting card,
calendar, dairy etc as practiced by other competitors. Outlets near
schools, hospitals, bus stands and institutional cafeteria should
be provided with good publicity material, additional discount,
schemes to boost the sales of biscuits & confectionary.
Sampling of confectionary should be done Cancellation of the bills
should be checked. Delivery of goods should be improved.
BibliographyC.R. Kothari Research Methodology & Techniques.
Kotler, Philips Marketing Management INTERNET WEBSITES:
www.google.com www.itcportal.org.co.in
QUESTIONNAIREName of the whole
seller:________________________________ Contact
No.:___________________________________________
Address:______________________________________________
1. Monthly turnover of the whole seller (a) Less than 5 lacs
(c(c)) 10 lacs to 15 lacs 2. Major selling category (a) Biscuits
(c) Tobacco (b) Confectionary (d) others (b) 5 lacs to 10 lacs (d)
More than 15 lacs
3. Type of scheme preferred (a) Consumer (b) retailer
4. Rank the best seller in Biscuits (a) Sunfeast (c) Britannia
(b) Parle (d) Others
4. Rank the best seller The brand in which you deal in
confectionary (a) Candyman (c) Perfeitte (b) Parle (d) Others
5. R6. ank Thethe most demanded product in Sun feastbest seller
Biscuitin Biscuit (a) Sunfeast (c) Britannia (b) Parle (d) Others
_____________
6. Servicing offered per weak (a) Parle (c) Britannia 7.
Services offered by ITC are (a) Satisfied (c) Less Satisfied (b)
Not Satisfied (d) Highly Satisfied (b) ITC (d) Perfeitte
8. Quality offered by ITC is (a) Poor (ba) Good ((cb) Better
(dc) Best
9. The brands in which you deal in confectionary (a) Candy man
(c) Perfeitte (b) Parle (d) Others
10. Quality offered by ITC products is
(a) Satisfied (c) Less satisfied
(b) Not satisfied (d) Highly satisfied
D.S. Productivity Sheet
WD Point
Total Sales Value
S.N.1 2 3 4 5
Name Total of DS Call
Productve Call
Av g Line Cut Bis Atta Conf Pasta Salt Other
Total Sale Value
