Professional Documents
Culture Documents
FLOW OF PRESENTATION
COMPANY PROFILE VISION & MISSION VALUE POSITIONING OF ITC DISTRIBUTION NETWORK SUPPLY CHAIN ANALYSIS OF FMCG PRODUCT(CIGARATTE) & PEST AND SWOT ANALYSIS OF ITC. SYNERGIES FOR ITC EFFICIENCIES IN E-CHOUPAL NETWORK COMPARISON WITH HARYALI KISAN BAZAR FUTURE OF E-CHOUPAL CONCLUSION
Introduction
ITC is one of India's foremost private sector companies Has a diversified presence in Cigarettes, Hotels, Paperboards &Specialty Papers, Packaging, Agri-Business, Packaged Foods &Confectionery, Branded Apparel, Greeting Cards and other FMCG products. ITC is one of the country's biggest foreign exchange earners (US $2 billion in the last decade). April 09) No. 1 in FMCG Sector Rated as one of Indias Most Respected Companies (IMRB-Business world Survey 2006). Diversified group of companies with operations in various industry segments from cigarettes to apparels. Annual turnover is of the order US$2.4 billion
Ranks No. 4 among Indian listed Private Sector Companies by market cap. (@
Values
ITC's Core Values are aimed at developing a customerfocused, high-performance Organisation.
Customer Focus we are always customer focused and will deliver what the customer needs in terms of value, quality and satisfaction.
POSITIONING OF ITC
PRODUCT PROFILE
Branded Apparel Hotel
Stationery
Cigarett es
Package d Foods
Incense Sticks
Paperbo ards
Personal Care
Informat ion Safety Matches Technolo Agricult gy ITC. Touchingural life. Everyday your Industry
PRODUCT LINE
Retailer consumer
PEST ANALYSIS
Huge burden of VAT Excise duty raised by union budget by 5 % Ban on communication Luxury tax in 10 states Smuggling 100% FDI allowed Bidee : cigarette ratio-10:1 Profit margin is high Other forms of cheap tobacco intake
POLITIC AL
ECONO MICAL
SOCIO CULTUR AL
TECHNICAL
State-of-the-art factories Cheap labour supply Development of IQMS Adapting other concepts like QC,TQM, KSS, 5 S, 6 sigma
ITC. Touching your life. Everyday
Becoming status symbol Companions mounted by W.H.O. Changing attitudes towards tobacco May 31 is no tobacco day Change in life style
SWOT ANALYSIS
Strength Cigarette market is 22,000 cr and ITC has lions share in it Strong brand recognition and product portfolio Distribution network Management Opportunity Low per capita consumption Of personal care products Rural Market E-Choupal Filter cigarette segment of less than 60mm size Weakness Dependence on tobacco revenues Negative Connection of Tobacco
Threat Competition both Domestic & International Increasing Tax on cigarettes Excise duty on unfiltered cigarettes less than 60mm in length was increased 387% last year Hike was 142% for those between 61mm and 70mm long. Regulatory restrictions on cigarettes ITC. Touching your life. Everyday Ban on smoking
CONFRONTATION
NAVY CUT,CLASSIC,INSIGNIA,INDIA KINGS,CAPSTEN,GOLD FLAKE,SISSORS,SILK CUT,BRISTOL,BERKELEY
Red & White Super Cavender Magna 4% Panama Plain 4% 4% Four Square Premier 5%
Silk Cut Premium 11% Wills Navy Cut 7% Silk Cut Kings 5% IK Regular (Rich Gold) B&H Light 1% 2% Classic Regular 4% Classic Ultra Mild 4%
Diversification
ITC over the years has been investing cash flows from its cigarette business into various lucrative segments like foods, personal care, hotels and paper. With the paperboard division coming out of a major capex cycle and a reduction in losses from FMCG-others division from FY10E, we expect the non-cigarette businesses to become self-sufficient. The agriculture division continues to provide a strong support as an excellent raw material sourcing base. Hotels segment though is likely to register slower growth in FY10E due to economic slowdown and terror attacks.
1190
561
488 141
USA
China
Pakistan
Nepal
India
World Avg.
Source : Based on Cigarette consumption data(2003) from World Cigarettes,ERC Group plc.
ITC. Touching your life. Everyday 18
CONT.
It has 3 contract manufacturers (OCMs)Reliable Cigarette and Tobacco IndustriesPrivate Ltd. (RCTI) Asian Tobacco Company (ATC )Hyderabad Deccan Cigarette Industries(HDC) Huge distribution network with 19 marketing branches and 33 Godowns across nation Also caters to the exports mainly in United States and Middle-Eastern countries
Factories (4)
GODOWNS (19)
BRANCHES (19)
Information Goods
RETAILERS
SECONDARY WHOLESALERS
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
Farm linkages in 14 states covering Soya, Wheat, Marine products, Coffee etc. Focus on value added agri commodities Unique CRM programme in commodity exports Leveraging IT for the transformational e-Choupal initiative
Low Margins
Low Investment
Low Productivity
Company Logo
Source: Seminar on Bottom of the Pyramid and CSR, IIM-K, Sept. 24, 2008
Company Logo
Interest
Access to information Empowered decisions Improved agriculture Economic benefits through lower transaction costs and process efficiencies Served with dignity Knowledge bundled sale of goods and services Co-opted in product design Hope for a brighter future Lower procurement costs Direct interaction with farmers - Control on quality & supply security Low cost distribution channel Access to market intelligence Gain access to global markets through ITC and commission to compensate some of the loss revenue
ITC
CONCLUSION
ITC promoting their brands through advertisement campaign as well as door to door promotion. ITC is also focusing on Retailers and Wholesalers to promote their brand. The demand of their product in very low, because people dont know about their brands very well. ITC knows their strength and weakness in the personal care market, so they are applying new concept to overcome their weaknesses. ITC now offering more margins, exiting offers and long credit period to retailers and wholesalers.
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ITC. Touching your life. Everyday