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SALES AND DISTRIBUTION PROJECT

Sales (Pre & Post) & Distribution’ effectiveness:


A comparative study of
Asian Paints Ltd.
&
Nerolac Paints Ltd.

Under the guidance of: Submitted by:


Prof. Maninder Singh Ram Kamboj
Group no. B2138 Reeva Sharma
Neha Satija
Tinku Shokeen
Gaurav Chawla
Saurav Gulati

EXECUTIVE SUMMARY
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

This project aims to study the distribution channels, sales network and service patterns of the
paint sector through an analytical and comparative study of two leading companies- Nerolac
Paints India Ltd. (NPIL) and Asian Paints Ltd. (APIL). The project also tries to bring out the
shortcomings, if any, in the present system and thus recommends suggestions to improve the
same. The project also gives insights into the various financial terms, norms of the sales and
service departments as per the guidelines of the paint industry.

The project was designed after detailed discussion with the company officials on three
parameters i.e. distribution network, service network and sales functioning. The project also
includes the insights given by the dealers and officials of the company. “The sample size of 6
for channel members and that for the sales people was 2, for each company”.

Firstly, the project discusses the distribution network of the two companies and the functions
carried out by the channel members. Asian Paints being the largest paint manufacturer in
India definitely has a wider reach and more number of dealers than Nerolac.

The project also covers the financial terms of the company with the dealers and that of the
dealers with the customers.

Secondly, the project discusses the sales functioning of the two companies, which includes
aspects such as the hierarchy of the sales department prevalent in the company; the
responsibilities and functions of the sales force, their performance appraisal structure etc.

Finally the project covers the service network of the two companies which deals with the
after sale services and their effectiveness provided by both the companies and various
complaints and queries are handled by them

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

ACKNOWLEDGEMENTS

We are very thankful to the entire dealer, service, and sales network of Nerolac India
Limited and Asian Paints Limited for their cooperation, without which completion of this
project would not have been possible.

We are extremely grateful to Mr. NAGENDRA K. SHARMA ( Project Sales Manager,


Nerolac India Ltd, New Delhi), . Mr, ASHISH VERMA decorative sales,Nerolac Paints
India Ltd., New Delhi) Mr. MOHIT AGGARWAL (Project sales Manager, Asian paints
India, New Delhi) and Mr, Mr. ANURAG PANDEY (Decorative Sales Officer, Asian
Paints India Ltd., New Delhi) for sharing with us all the details of the project and providing
us with valuable insights about sales, distribution & servicing function. We would like to
thank them for the patience shown by them and being of such a great help to all our queries.

We would also like to express our gratitude towards our professors, for giving us an opportunity to do this
project on sales and distribution and for being the guiding light through the completion of this project.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

CONTENTS

1. Executive Summary `
2. Acknowledgement

3. Methodology
4. Indian Paint Market

5. Company Background(ASIAN PAINTS)


6. Distribution Network

7. Selection of Dealers
8. Service Network

9. Company Background(NEROLAC PAINTS)

10. Distribution Network

11. Selection Of Dealers

12. Service Network


13. AnalysiS
14. Annexure

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

METHODOLOGY

The objective of this project on sales and distribution is to do an analytical and comparative
study of the sales, service and distribution function of two players from the chosen business
sector.
The business sector chosen for this purpose is the fast growing paint sector, and the players
chosen for study from this sector are:

NEROLAC INDIA LIMITED


ASIAN PAINTS LIMITED

INFORMATION SOURCES

PRIMARY DATA SOURCES-


 NEROLAC INDIA LIMITED- Head, Corporate Sales

 NEROLAC AUTHORISED DEALERS

 ASIAN PAINTS LIMITED – Area Sales Manager


 ASIAN PAINTS AUTHORISED DEALERS

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

SECONDARY DATA SOURCES-


THE INTERNET
www.nerolac.com
www.asianpaints.com
www.google.com
http://www.indiacom.com/yellowpage/category-
gyan/articles/paints/Paints-Introduction.asp?category=paints

DATA COLLECTION TOOLS

Interviews & Discussions with the company officials, dealers and Sales people.
Questionnaires were used to record data.

SAMPLE SIZE USED

The sample size for the dealers was 12 in number while the sample size for sales people was
4.
Asian paints (dealers) - 6
Asian paints (sales people) – 2
Nerolac India (dealers) – 6
Nerolac India (sales people) – 2

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

LIMITATIONS:

It was difficult to ask for time required for a detailed discussion on the questionnaire &
therefore several aspects of the questionnaire were answered briefly.
The company officials did not divulge details about competitive sales policies, strategies &
certain financial terms with dealers as they find it to be a confidential piece of information of
the company.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Indian Paint Market


In India, Indian Paint industry’s total market size is US$1400 million. The organized sector
of the industry is 55%. The 45% unorganized sector has about 2500 units. The big players
and their market share-value of the organized sector are
Asian Paints 37%
Goodlass Nerolac 15.9%
Berger Paints 13.8%
ICI 11%
Jenson & Nicholson 5.7%
Shalimar 4%
Others 12%
The market segment is divided into two sectors.
Architectural 70%
Industrial 30%
The total volume of the market is 600,000 MT

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IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

ASIAN PAINTS

Nath Balakrishnan

`The paint industry in India still has a lot to do to promote usage, which by itself is a huge
opportunity.'

Asian Paints is a household name in the domestic paints industry. Now, with operations in 23
countries across the world, its business is acquiring a global dimension. In a freewheeling
interview with Business Line, Mr Ashwin Dani, Vice-Chairman and Managing Director of
Asian Paints (AP) shares his outlook on the company's prospects, how various categories
within the paints segment fared, the role of marketing initiatives, such as the installation of
tinting machines, and, finally, about AP's acquisition-led expansion strategy. Mr Dani's
views on developments on the acquisition front will be published next week.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Demand for paints comes from two broad categories:

 Decoratives:

• . Decorative paint's market size stands at around Rs 32.5 Bn. Asian paints is this
market leader in this segment

• Under this segment it offers Painting Guide, Painting Solution, Paint Calculator and
Paint Selector as value added decorative service.

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IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

 Industrial:

Asian Paints offers 4 types of industrial coatings such as :

• Protective Coatings - protects steel and concrete structures from the corrosive action
of harsh climates, pollution, sea spray, acids, oils and solvents.

• Road Markings – are used as road markers for lane as indicator of lane separation and
also as safety markers. They include ordinary road marking paint, hot applied retro-
reflective thermoplastic material and retro-reflective water borne paints.
• Powder Coatings – is used to enhance the performance of Industrial paints.
• Floor Coatings – such paints protects the floor surface and prevents crack formation,
insect nest formation, water seepage etc

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

The paints sector is raw material intensive, with over 300 raw materials (30% petrol-based
derivatives) involved in the manufacturing process. Since most of the raw materials are
petroleum based (ex: Titanium Dioxide), the industry benefits from softening crude prices.

COMPANY DECORATI INDUSTRI OVERAL ESTIMATED


VE AL L PAINT
REVENUES
Asian Paints 38% 14%-16% 32.5% Rs. 6,980 MM
Goodlass Nerolac 7.8% 40% 17.5% Rs. 3,750 MM
Berger Paints *14% *14% 14.0% Rs. 3,007 MM
ICI India Ltd. 8%-9% 12% 10.5% Rs. 2,254 MM
Jenson and *6.9% *6.9% 6.9% Rs 1,482 MM
Nicholson
Growth Rate 8-9% 18% 11%
Total (Rs.) 15,033 MM 6,442 MM 21,476
MM

• Since these companies strive to match their product sales to the market (i.e. 70% : 30%)
they maintain similar market share in each segment

PRODUCT RANGE

• Asian Paints Premium Emulsion


• Asian Paints Interior Wall Finish Lustre
• Asian Paints Ace Exterior Emulsion
• Asian Paints Apcolite Clear Synthetic Varnish
• Asian Paints Touchwood
• Asian Paints Utsav Enamel
• APEX ULTIMA
• With 7 year warranty

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

COMPANY BACKGROUND

Asian Paints
Asian Paints, established in 1942, is India's largest paint company and the third largest paint
company in Asia. It has a turnover of Rs 30.2 billion (around USD 680 million). The
company operates in 21 countries and has 29 paint manufacturing factories servicing 65
countries.

The company operates several subsidaries such as Berger International Limited, Apco
Coatings, SCIB Paints and Taubmans. The company manufactures paints for decorative,
industrial, and motor applications

The history of AP dates back to 1942. It was started by four entrepreneurs, Champaklal
Choksey, Chimanlal Choksi, Suryakant Dani and Arvind Vakil, as a partnership firm for
manufacturing paints, in a garage rented for Rs 75 a month. In 1945, the partnership firm
was turned into a private limited company named Asian Oil & Paint Co. Pvt. Ltd. And in the
same year, its turnover touched Rs0.35million.

In the 1940s, it was largely multinational companies such as British Paints and Jenson &
Nicholson that dominated the Indian paints market. In order to increase revenue, AP
concentrated on the smaller towns ignored by multinationals. In 1954, Asian Paints asked the
famous cartoonist R.K. Laxman to create a mascot for the company, and from his pen was
born – Gattu – which emerged as one of India’s most memorable mascots (Refer Figure I).
However, AP’s market research found out that in rural India, farmers who wished to paint

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

the horns of their bullocks preferred to buy paint in small packs. Soon AP came out with 50-
ml packs, which became very popular

Asian Paints Limited ("Asian Paints") is transforming itself to become a major world player
in the decorative paints business with particular focus on emerging markets following its
acquisitions of controlling stakes in Berger International Limited ("Berger International") of
Singapore and SCIB Chemical S.A.E. ("SCIB") of Egypt. The total investment made by the
company in both these acquisitions amount to around US$ 16.8 million (S$29.6 million).

Asian Paints announced that it would focus on emerging markets of the world for growth
and also that Berger International will be the main growth driver for Asian Paints
international operations Focusing on the aspect of increasing shareholder value in Berger
International, Mr. Dani said: "In Berger International, Asian Paints will focus to increase
shareholder value by further improving the supply chain management in the subsidiaries
(Asian Paints supply chain management is considered the best in India servicing around
14,500 dealers directly from 70 sales locations and manufacturing over 2,500 stock-keeping
units (SKUs).

The success of AP has been attributed to its customer-centric approach and aggressive
marketing initiatives, which had changed the way industry, functioned.

AP wanted to be one of the top five companies in the global paints industry by 2007. In
order to achieve this goal, it focused on three main areas - building the AP brand in terms of
a new product portfolio, changing its logo and packaging. The new AP was expected to be
even more customer-friendly and service-oriented. In order to keep its prices low, AP had to
keep its production costs low. So it undertook backward integration to reduce production
costs. In 1987, it entered into joint venture with Tamil Nadu Industrial Development
Corporation (TIDCO) - Pentasia Chemicals Ltd, for the manufacture of pentaerythritol and
sodium formate - two important intermediates for manufacturing paints.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

• South Asia: ASIAN PAINTS


• South East Asia: BERGER INTERNATIONAL
• South Pacific : SCIB PAINTS
• Middle East : APCO COATINGS
• Caribbean region : TAUBMANS

Distribution network

Channel structure, members and their selection

Channel structure ASIAN PAINTS is all over India. The channel structure is very simple
and effective. Complications are kept out in order to make the overall process very effective
and efficient.
• 20,000 Dealers all over India

• 1,000 Dealers in New Delhi alone

• 14 products, 1200 shades

• Depots in Delhi : Badarpur, Mayapuri, Wazirgunj, Mandori

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Asian Paints, the market leader in the architectural segment, has over 14 product
offering over 1,200 shades in package sizes ranging between 1 liter to 20 liters.

Logistics required to ensure that each of the company’s dealers has just adequate stock of
each shade of each product range, in each size. This calls for immense accuracy in demand
forecasting and an excellent network.

However, the advent of tinting machines has considerably eased the distribution blues. With
this technology, a paint company only needs to provide the dealer with certain base colors,
tinting machines (which include a dispenser, shaker and a computer), colorants or strainers,
and a color card. The consumer chooses a particular shade from the card. The dealer puts the
code of the shade in the computer and the computer programme finds the exact formula for
the corresponding color.

TINTING MACHINE

Dealers’ Tinting Machines (DTS)


1. Powerful marketing tool
2. Making major investment. Already invested Rs. 92-100 crore

Trying that these machines are directly purchased by dealers .The programme ensures that
the required stainer gets added to the base paint in the required quantity and the new paint
comes pouring out of the tinting machine in the shade chosen by the customer

CHANNEL
P L A N STRUCTURE
T

DEPOT R E G IO N A L D IS T R IB U T IO N C H A N N E L
T y p e t it le h e r e

S U B -D E P O T
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints

PLANT STO CK
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

SELECTION OF DEALER

Asian Paints follows a strict policy in selection of the dealers:

1) The dealer should have a sound financial background.


2) The dealers’ current business goodwill, measured in terms of dealer goodwill which
covers areas such as infrastructure, manpower etc. and individual goodwill
3) The dealer should have his own infrastructure and logistics, since he is completely
responsible for the inventory and transportation of the goods to the shop from his warehouse

Responsibilities and Functions of the dealers

ASIAN PAINTS believes in “Customer Loyalty” and thus asian paints expects that their
dealers apart from selling paint products should perform the following functions for better
customer relations’ management:

• Sales promotion through regular promotional schemes, road shows, campaigns etc.
Recruitment- done under the guidance of certain asian paint officers.
• Customer relation management

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

• ervicing according to the size of orders


• Training and development of manpower with company assistance

The dealer should be in regular touch with the customer, keep taking his feedback and
ensure maximum customer satisfaction. The dealer should also try and convince the
customer to try newer products of the company.

PAYMENT MODES

Cheque is the only acceptable way of payment


HOME
SOLUTIONS
Margins/Discounts
The dealers collect their margins at the time of sale of the product. Margin/discounts is provided by the company
between 3.5% to 5%

FEEDBACK FROM CUSTOMERS


Customer feedback is obtained not only after servicing as mentioned earlier, but post sales
too. There are 2 types of feedback forms customers can fill:
• A feedback to company through questionnaires and cards
• Direct feedback to the sales people.

All these feedback cards are sent to the corporate office of the company where the required
action is taken.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

NEROLAC PAINTS LIMITED

They embarked their journey in 1920 as Gahagan Paints and Varnish Co. Ltd. at Lower Parel
in Bombay. In 1930, three British companies merged to formulate Lead Industries Group
Ltd. In 1933, Lead Industries Group Ltd. acquired entire share capital of Gahagan Paints in
1933 and thus, Goodlass Wall (India) Ltd. was born.
Subsequently, by 1946, Goodlass Wall (India) Ltd. was known as Goodlass Wall Pvt. Ltd. In
1957, Goodlass Wall Pvt. Ltd. grew popular as Goodlass Nerolac Paints (Pvt.) Ltd. Also, it
went public in the same year and established itself as Goodlass Nerolac Paints Ltd.

In 1976, Goodlass Nerolac Paints Ltd. became a part of the Tata Forbes Group on acquisition
of a part of the foreign shareholdings by Forbes Gokak.

In 1983, Goodlass Nerolac Paints Ltd. strengthened itself by entering in technical


collaboration agreements with Kansai Paint Co. Ltd., Japan and Nihon Tokushu Toryo Co.
Ltd., Japan.

In 1986, Goodlass Nerolac Paints Ltd. turned into a joint venture of the Tata Forbes and the
Kansai Paint Co. Ltd., with the latter acquiring 36% of its share capital.

In 1999, Kansai Paint Company Ltd., Japan took over the entire stake of Tata Forbes group
and thus GNP became a wholly owned subsidiary of Kansai Paint Company Ltd.

In 2006, on the 11th of July, Goodlass Nerolac Paints Ltd. name has been changed to Kansai
Nerolac Paints Ltd.

During the journey of continuous performance excellence, they have entered in to much
technical collaboration with other industry leaders such as E.I. Du-Pont de Nemours &
Company Inc., USA and Oshima Kogya Company Ltd., Japan for our different products.

Our incessant journey of successes will go on


backed by our present human asset of over 2000

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Nerolac is carrying on strong since 1920. Following are its strengths that have kept this
company in good faith. Nerolac is a company with very clear and well-defined vision and
very strong values. Clarity of vision and strong foundation of cultural values have always
kept this company in good stead. Its ethical conduct has always guarded it against any
possible traps and pit falls.

We have made sure that the distribution hurdles and the climatic vagrancies do not affect the
quality of our services. This same commitment will ensure that Kansai Nerolac will march
towards its centennial year, fully dedicated and invigorated, in step with the exciting wave of
industrialization and modernization pervading through the new India.

COMPETE THROUGH INNOVATION

The keystone of Kansai Nerolac's success has been its investment in technology and the
importance given to Research and Development. The company has, over the years, set up
excellent facilities for developmental research, improving its manufacturing processes and
continuously innovating on its products.

The rich cumulative experience of the organization gathered over 80 years of experience
provides a strong backbone to all kinds of decisions taken in this company. 80 years of
learning in trade and market has given enough expertise to innovate and develop products
and services according to the changing needs and desires of customers.

Nerolac paint technology cuts across all barriers; without discriminating between uses or
users. The past decades have seen a meteoric rise in the fortunes of Kansai Nerolac. Today,
they are the second largest paint company and a recognized leader in their chosen fields. The
company was adjudged the fastest growing paint company in the organized sector, not once
but thrice-in consecutive years.
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

MANUFACTURING FACILITIES

Manufacturing is a very important function for the paint industry. Nerolac has made sure
that its manufacturing facilities are world class. Nerolac has five manufacturing units located
at:

• Perungudi (T.N.),
• Vatva (Gujarat),
• Jainpur (U.P.),
• Lote Parshuram (Maha.) &
• Bawal (Haryana).

The total installed capacity of all the units put together is158300 TPA. Its latest unit is at Bawal, which was
commissioned in March 2005, with a capacity of 20400 TPA with an investment of around Rs.100 crore- all
through internal accruals.

DISTRIBUTION NETWORK

Channel structure, members and their selection

Nerolac’s strength of wide spread distribution network is its right arm in generating sales
revenue from all parts of India. Nerolac has a wide distribution network of over 11,000
dealers

They have eight Sales Divisions and each division has depots to take care of local needs. In
all they have 66 depots

All this ensures complete reach in India including rural and up country markets

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Channel structure

Nerolac Paints Ltd.

Dealer/ distributor Warehouse

Dealer shops

End customer

There exist a total of 4000+ dealers with multiple outlets, i.e. a total of dealers covering
cities. The percentage of dealers in each of the zones is as follows.

North- 35%
South- 26%
East- 10%
West- 29%

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Market Research:
The company undertakes Market Research activity to measure its performance in different
fields, like after sales service, customer satisfaction etc. The company employs third party
agencies to measure its performance.

SSI (Sales Satisfaction Index)


The sales satisfaction study is a consumer-driven measure of customer satisfaction with the
product sales and delivery process. According to the study, there are six major factors
impacting satisfaction with the dealership at the time of purchase. They are Sales
Experience, Explanation at Delivery, Price Evaluation, Delivery Timing, Salesperson
Knowledge and Post-Delivery Contact.

CSI (Customer Satisfaction Index)


The customer satisfaction index with quality delivery performance is used to track the
problems experienced in the customer satisfaction process. This data helps in building future
policies and also helps in training the employees to perform better in future.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Service Network

Structure:

Group head

Service Support Field Support

On the job Training


Backend T&D Dealer CRM Day to day activities
Development Warranty

Nerolac India closely monitors each and every aspect of the entire process in the business
organization. The service network is similar to that of Asian paints but the CRN and training
and development is not that developed. The technical support in the business units is
different as we have already discussed earlier that Asian paints uses SAP and i2 technologies
while Nerolac uses push and pull protocol.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

ANALYSIS

COMPANY EXEUTIVE

As a part of our report, we used questionnaires for primary research. Our target group was:
the dealers, company executives and customers of Asian and Nerolac paints
CHANNEL STRUCTURE

COMPANY DIRECT PROJECT [INSTITUTIONAL / CORPORATE BUSINESS / B2B]

DIRECT CUSTOMER HOME SOLUTION [ASIAN PAINTS]


NAPS [NEROLAC PAINTS]

BULK BUYER [Like BUILDERS, CONTRACTORS ETC.]


GODOWN

RETAILERS WHOLESELLER
RETAILER

ORGANISATION STRUCTURE

SALES EXECUTIVE SALES OFFICER TERRITORY SALES EXECUTIVE

AREA SALES MANAGER

REGIONAL MANGER

VP MARKETING HEAD MARKETING HEAD [NORTH INDIA]


[MARKETING] …………
…………

CRITERIA FOR APPOINTING A DEALER

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Credibility in the market


Foot Fall
Financial position
Competitors

CREDIT, PAYMENT & WARRANTY

Credit depends on credibility of the dealer/shopkeeper.


It ranges from 0 – 30 days.
But CD will be 3.5% instead of 5%.

For NEROLAC:
Payment is done on the basis on CHEQUE ON DELIVERY & ADVANCE
CHEQUE [PAYMENT]

For ASIAN PAINTS:


Payment is done on the basis on CHECK ON DELIVERY

Warranty of Asian Paints for APEX ULTIMA is 7 years.


Warranty of Nerolac Paints for SURANKSHA ADVANCE is 4 years.

ORDER CYCLE, INVENTORY, TRANSPORT

Total company’s owned godowns through out the city: 4


Whole country is connected through SAP and are daily updated.
Therefore, order can be placed regularly & has withing a day service of delivery.

Inventory depends on financial capacity, schemes/discounts offered by the organisation.

Transport is outsourced by the company through C&F agents to the contractors on certain
terms & conditions set by the company.
Transport vehicles generally used are Tampo, Champions, TATA 407 etc.

DEALER’S ANALYSIS:
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

On the basis of our questionnaire, we analyzed the following:

• The dealer deals with different brand of paints. The ones which they generally keep in
stock are Nerolac, Asian, Berger, Shalimar and ICI Dulux paints.

• The demand for each paint varies in accordance to the area specified. The brand which
is generally demanded by customers are:-
Asian paints (West Delhi)
Nerolac paints (Central Delhi)
ICI paints (South Delhi)
Berger & Asian paints (North Delhi)

• The dealers generally don’t recommend anything to the customer; they give what the
customer demands. In case, the customer is a bit confused about the quality of the
product, then the dealers generally recommend ICI Dulux paint.

• Dealers are free to place any order. There is no minimum order as such.

• Average order cycle time is 1-2 days in case of Asian paints, while 5 days in case of
Nerolac paints.

• Transporter’s behavior, ease and flexibility of placing an order is very good for
Asian paints where as its good for Nerolac paints.

• Quality maintenance, condition of product is good for Asian paints while it’s very
good for Nerolac paints.

• Asian paints provide cash incentives at 1% while Nerolac doesn’t give any cash
incentive. Also, Asian paints gives commission (if June 2007’s sale is greater than
June 2006’s sale.) Other incentives being given are movie tickets, foreign trips, and
big bazaar discount coupons.

• Asian paint’s performance is satisfactory while Nerolac paint’s performance is good in


case of promotional activities, commercial terms, and service of sales persons.

• However delivery time, customers’ orientation is good for both Asian paints and
Nerolac paints.

• The efficiency of sales persons is good for Nerolac paints and satisfactory for Asian
paints.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

• Both Nerolac paints and Asian paints provide assistance to dealers in promotional
activities.

• Dealers of both Asian paints and Nerolac paints don’t provide appraisals to their
respective sales persons.

• None of the Dealers are facing any problem due to company’s distribution channel.

• If dealers face any kind of problem from customer’s side, the sales executive takes
care of it.

• Both the companies provide training to painters whenever new product, new finish is
introduced and skillful work is required.

• If the product is defective, both the companies take back the goods. In this case a
return goods voucher (RGV) is issued which contains the DOP and the batch number.
If the goods are returned within 3 months, dealer gets sales tax refund.

CUSTOMERS ANALYSIS:
The customers were questioned on:
What they do if they don’t get the desired paint?
Who influences them to buy that particular brand?
How frequently do they get their house white washed/touch ups?
Ranking certain parameters for their choice of paint.

What they do if they don’t get the desired paint?

For the Asian paints market, 76% of the respondents move to the next shop, 16% take
any other paint and the rest 8% take any other color of the desired paint.
WHILE;
For the Nerolac paint market, while 64% of the respondents move to the next shop,
24% take any other paint and the rest 12% take any other color of the desired paint.

The above data shows that the respondents of Asian paints market are more brand
loyal as compared to Nerolac paint market.
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

DON'T GET THE DESIRED PAINT - ASIAN DON'T GET THE DESIRED PAINT - NEROLAC
PAINTS PAINT

MOVE TO NEXT MOVE TO NEXT


SHOP SHOP

13, 8% 10, 12%


25, 16% TAKE ANY TAKE ANY
OTHER PAINT 21, 24% OTHER PAINT

55, 64%
116, 76% TAKE ANY TAKE ANY
OTHER COLOUR OTHER COLOUR
OF THE DESIRED OF THE DESIRED
PAINT PAINT

Who influences them to buy that particular brand?

On the whole, it was noticed that in 23% of the cases, shopkeeper influenced people to buy a
particular brand of paint, be it Asian Paints or Nerolac Paints. In about 18% of the cases,
people were influenced by relatives and friends. Endorser and painter influenced people to
about a 16%.
People were influenced by kids only in 9% of the cases.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

PEOPLE WERE INFLUENCED BY...

9%
23%
SHOPKEEPER
16%
RELATIVES
FRIENDS
ENDORSER
18% PAINTER
16%
KIDS

18%

How frequently do they get their house white washed/touch ups?

From the various options given, i.e., half yearly, yearly, once in two years, once in three
years and occasionally for both Asian Paints and Nerolac Paints.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

40.00%
35.71%
35.00%

30.00% 27.91%
26.62% 26.74%

25.00% 22.09%
20.78%
20.00%
15.12%
15.00%
` 11.69%

10.00% 8.14%
5.19%
5.00%
0.00%
HALF YEARLY YEARLY ONCE IN TWO ONCE IN THREE OCCASSIONALLY
YEARS YEARS

Asian Nerolac

Details:

Half yearly:

Asian paint Nerolac paints

5.19% 8.13%

which automatically shows 6.25% people get their places painted half yearly in our chosen
market. This is not very potential segment, which requires the focus of the industry in the
chosen market.

Yearly:

Asian paint Nerolac paints

35.7% 22.09%

which surely means that 30.84% of the market get their places painted yearly.

Two years

Asian paint Nerolac paints

26.62% 27.90%

This shows, 27.09% of the market get their house painted once in two years.
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Three years:.

Asian paint Nerolac paints

20.77% 26.74%

which shows that 22.91% market get their house painted once in three years.

Occasionally:

Asian paint Nerolac paints

15.12% 11.68%

This implies,12.91% of market get their house painted occasionally.

The next aspect of the questionnaire involved the respondent to rank the performance of his
choice of brand on various parameters. Now, we would discuss each parameter in detail.

AVAILABILITY OF THE PRODUCT:

The first parameter, asked the respondent to judge the availability of both the categories of
paints. In the Asian paint segment, 48.5% and in the Nerolac paint segment 24.5% said that
the availability was excellent. 30.7% and 42.3% respondents said that the availability was
very good for Asian paints and Nerolac paints respectively. 18.75% and 28.8 % respondents
said that the availability was good for Asain paints and nerolac paints respectively. 1.9% and
4.2% respondents were not satisfied with the availability of the paint, thus rated the
availability as fair.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Availability of the product

60.00

48.56
50.00
42.37
40.00
Percentage

30.77
28.81 ASIAN PAINTS
30.00 24.58 NEROLAC PAINTS
18.75
20.00

10.00 4.24
1.92
0.000.00
0.00
EXCELLENT VERY GOOD FAIR POOR
GOOD
Parameters

NEW /

INNOVATIVE PACKAGING

The second parameter, asked the respondent to judge the rate the innovative packaging of
both the categories of paints. In the Asian paint segment 36.5% and in the Nerolac paint
segment 26.3% said that the company’s packaging was excellent. 30.8% and 39.8.3%
respondents said that the company’s packaging was very good for Asian paints and Nerolac
paints respectively. 26.4% and 26.3 % respondents said that the company’s packaging was
good for Asian paints and nerolac paints respectively. 6.3% and 7.6% respondents were not
satisfied with the availability of the paint, thus rated the company’s packaging as fair.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

NEW / INNOVATIVE PACKAGING

45.0%
39.8%
40.0%
36.5%
35.0%
30.8%
NO. OF RESPONDENTS

30.0%
26.3% 26.4%26.3%
25.0% ASIAN PAINTS

20.0% NEROLAC PAINTS

15.0%

10.0% 7.6%
6.3%
5.0%
0.0% 0.0%
0.0%
EXCELLENT VERY GOOD GOOD FAIR POOR
PERFORMANCE

INTRODUCTION OF NEW PRODUCTS

The third parameter, asked the respondent to rate the frequency of introduction of new
products for both the categories of paints. In the Asian paint segment 25% and in the Nerolac
paint segment 23.7% said that the frequency of introduction of new products was excellent.
37.5.% and 34.7% respondents said that the frequency of introduction of new products was
very good for Asian paints and Nerolac paints respectively. 32.2% and 31.4% respondents
said that the frequency of introduction of new products was good for Asian paints and
nerolac paints respectively. 5.3% and 10.2% respondents were not satisfied with the
frequency of introduction of new products, thus rated the company’s packaging as fair.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

INTRODUCTION OF NEW PRODUCTS


37.5%
40.0%
NO. OF RESPONDENTS

34.7%
35.0% 32.2%
31.4%
30.0% 25.0%
23.7%
25.0%
ASIAN PAINTS
20.0%
15.0% NEROLAC PAINTS
10.2%
10.0% 5.3%
5.0% 0.0%0.0%
0.0%

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PERFORMANCE

CONTAINER SIZE

The fourth parameter, asked the respondent to rate the availability of paint in different
container sizes as per their requirements for both the categories of paints. In the Asian paint
segment 20.2% and in the Nerolac paint segment 16.1% said that availability of paint in
different container sizes was excellent. 39.4.% and 36.4.% respondents said that the
availability of paint in different container sizes was very good for Asian paints and Nerolac
paints respectively. 33.2% and 35.6% respondents said that the availability of paint in
different container sizes was good for Asian paints and nerolac paints respectively. 7.2% and
11% respondents were not satisfied with the availability of paint in different container sizes,
thus rated the company’s packaging as fair.
0.8% respondents of Nerolac Paints, were not at all satisfied with the availability of paint in
different container sizes and thus rated this parameter as poor.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

CONTAINER SIZE

45.0%
39.4%
40.0% 36.4% 35.6%
33.2%
NO. OF RESPONDENTS

35.0%
30.0%
25.0% ASIAN PAINTS
20.2%
20.0% 16.1% NEROLAC PAINTS

15.0% 11.0%
10.0% 7.2%
5.0%
0.8%
0.0%
0.0%
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PERFORMANCE

AVAILABILITY OF COLOR

The fifth parameter, asked the respondent to rate the availability of color of their choice for
both the categories of paints. In the Asian paint segment 39.4% and in the Nerolac paint
segment 32.2% said that availability of color of their choice was excellent. 32.2.% and
40.7.% respondents said that the availability of color of their choice was very good for Asian
paints and Nerolac paints respectively. 23.1% and 22% respondents said that the availability
of color of their choice was good for Asian paints and nerolac paints respectively. 3.8% and
5.1% respondents were not satisfied with the availability of color of their choice, thus rated
the company’s packaging as fair.
1.4% respondents of Asian Paints were not at all satisfied with the availability of color of
their choice and thus rated this parameter as poor.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

AVAILABILITY OF COLOR

45.0%
40.7%
39.4%
40.0%

35.0% 32.2% 32.2%


NO. OF RESPONDENTS

30.0%

25.0% 23.1%
22.0% ASIAN PAINTS
20.0% NEROLAC PAINTS

15.0%

10.0%
5.1%
3.8%
5.0% 1.4%
0.0%
0.0%
EXCELLENT VERY GOOD GOOD FAIR POOR
PERFORMANCE

STAR ENDORSEMENT

The sixth parameter, asked the respondent whether star endorsement for both the categories
of paints affected their purchase. In the Asian paint segment 36.5% and in the Nerolac paint
segment 24.6% said that star endorsement was excellent and did affect their purchase. On
the other hand, 1.4% and 7.6% respondents were not at all satisfied with star endorsement
and it did not even affect their purchase, thus rated it as poor.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

STAR ENDORSEMENT

40.0%
36.5%
35.0% 33.1%
32.2%

30.0%
NO. OF RESPONDENTS

25.4%
24.6%
25.0% 22.1%
ASIAN PAINTS
20.0%
NEROLAC PAINTS
15.0%
9.3%
10.0% 7.7% 7.6%

5.0%
1.4%
0.0%
EXCELLENT VERY GOOD GOOD FAIR POOR
PERFORMANCE

VARIETY

The next parameter, asked the respondent to rate the variety for both the categories of paints.
In the Asian paint segment 34.6% and in the Nerolac paint segment 22.9% said that variety
of color excellent. 40.4% and 39.8.% respondents said that the variety of color of their
choice was very good for Asian paints and Nerolac paints respectively. 18.8% and 25.4%
respondents said that the variety of color was good for Asian paints and nerolac paints
respectively. 5.8% and 9.3% respondents were not satisfied with the variety of color ,thus
rated the company’s packaging as fair.
0.5% and 2.5% of respondents of Asian Paints and nerolac paints were not at all satisfied
with the variety of color and thus rated this parameter as poor.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

VARIETY

45.0%
40.4%
39.8%
40.0%
34.6%
35.0%
NO. OF RESPONDENTS

30.0%
25.4%
25.0% 22.9%
ASIAN PAINTS
18.8% NEROLAC PAINTS
20.0%

15.0%
9.3%
10.0%
5.8%
5.0% 2.5%
0.5%
0.0%
EXCELLENT VERY GOOD GOOD FAIR POOR
PERFORMANCE

PRICE RANGE

The next parameter, asked the respondent to rate the price range for both the categories of
paints. In the Asian paint segment 26.9% and in the Nerolac paint segment 22% said that
price range of color excellent. 36.5% and 30.5.% respondents said that the price range of
color of their choice was very good for Asian paints and Nerolac paints respectively. 25.5%
and 32.2% respondents said that the price range of color was good for Asian paints and
nerolac paints respectively. 11.1% and 14.4% respondents were not satisfied with the price
range of color ,thus rated the company’s packaging as fair.

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

PRICE RANGE

40.0%
36.5%
35.0% 32.2%
30.5%
NO. OF RESPONDENTS

30.0% 26.9%
25.5%
25.0% 22.9%
ASIAN PAINTS
20.0%
NEROLAC PAINTS
14.4%
15.0%
11.1%
10.0%

5.0%
0.0%0.0%
0.0%
EXCELLENT VERY GOOD GOOD FAIR POOR
PERFORMANCE

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

ANNEXURE

Questionnaire for Channel Members

Name : Phone no :

Address: Organization:

1) What are the different brands which you keep in stock?

2) Which brand is most asked by the customers


i) Asian paints ii) Nerolac iii) Dulux iv)Others……………………………..

3) What is your average sales/month?

4) Which brand do you recommend to the customer and why?

5) Do you get any credit period from the company?


a) YES b) NO
If Yes, What is the credit period you get:
i) Up to 15 days ii) 15-30 days iii) >30 days

6) What is your average order size?

7) What are the margins that you get from the company?

8) What is the average order cycle time taken by the company?


i) < 5 days ii) 5-10 days iii) > 10 days

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

9) Where would you rank the services/assistance provided to you by the company/s
Very Good Satisfactory Poor Very
Good poor
Delivery Time
Quality Maintenance
Incentives
Promotional activities
Condition of Product
Ease and Flexibility of
placing Order
Transporter’s Behavior
Customers Orientation
Commercial Terms
Services of Sales Persons

10) How will you rate the efficiency of your sales persons
a) Very Good b) Good c) Satisfactory d) Poor e) Very poor

11) Does company provides you with any assistance by means of promotional activities?
a) YES b) NO
If Yes, Numbers, Timing, Quantity of promotions.

12) Do you provide appraisals to your sales persons?


a) YES b) NO
If Yes, on what Parameters?

13a) what kind of problem do you face in company’s distributing channel?


b) What kind of problem do you face from customer? How do you solve them?
c) How company helps you in same ( a & b )?

14) Does the company provide any kind of training? If yes, what is the motive of training?

15 a) Do you get incentive & commission?


b) What are the different kinds of incentive offered by company?

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

c) What is the criterion for the same?


d) How much incentive & commission do you earn annually?
e) How much sales target do you get?
f) Are you able to achieve sales target set by company?
g) How company helps you in achieving sales target?
_______________________________________________________________________
Person contacted: …………………………………………………………..
Name of dealer: ……………………………………………………………..
Address: ………………………………………………………………..
Tel. No.: …………………………

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Questionnaire for Company’s Sales Executive

Name : Phone :

Address: Organization:

1. What type of sales organization structure do you possess?

2. What are the various channel structures in which you operate?

3. What are the various criterion/terms and conditions of selecting your channel members?

4. What is the average Inventory Size you keep?

5. What is the average Order Cycle time?

6. What are the various modes of transportation adopted and cost incurred?

7. What are the methods of measurement and frequency of providing appraisals to channel members?

8. What are the modes of by which you receive your payments:


i) Advance payment ii) Payment on Delivery iii) Credit payments

9. In case you provide the credit period, what is the time limit?
i) upto15 days ii) 15-30 days iii) >30 days

10. How frequently do you collect the feedback from your Channel members?
i) Weekly ii) Quarterly iii) Monthly

11. How will you rate and rank the following aspects of your Channel Members:
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

Excellent Very good Good Fair Poor


Dealer’s
Efficiency
Timely payment
Transporters
behavior

12. What are the margins you provide to your Channel Members?

13. How do you assign targets to your sales personnel’s and what type of targets?

14. Do you support your Channel Members by promotional activities?


a) YES b) NO
If Yes, i) Number of Promotions.
ii) Timing of Promotions.
iii) Quantity of Promotions.

15. Have you ever gone for market research?


a) YES b) NO
If Yes, w.r.t. whom?
• Customers
• Channel Members
• General market survey
• Hidden survey rate price and margins

16. i) What type of market research was it?


ii) What was your budget? depend upon survey

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

17. How frequently you go for market research? Annually may be twice

Name of Respondent: ……………………………………………………


Name of Organization:……………………………………………………
Designation: ……………………………………………………
Address: …………………………………………………….
Tel. No.: …………………………………………………….

QUESTIONNAIRE:CUSTOMER

NAME: __________________________

AGE: ______

GENDER: ___ MALE ___ FEMALE

1) Which brand of paints do you prefer?

a) Asian Paints b) Nerolac Paints c) Others ____________

2) What do you do if you don’t get the desired paint?


a) Move to next shop
b) Take any other paint
c) Take any other color of the desired paint

3) Who influenced you to buy this brand?

a) Shopkeeper
b) Relatives
PAINT SECTOR- ASIAN PAINTS & Nerolac Paints
IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

c) Friends
d) Endorser
e) Kids
f) Painter

4) What do you prefer:-


a) White Wash b) Touch Ups

5) How frequently do you get your house white washed/touch ups?


a) Half yearly
b) Yearly
c) Once in two years
d) Once in three years
e) Occasionally

6) In considering the performance how would you rate the company as per following scale:

1-Excellent 2-Very good 3-Good 4-Fair 5-Poor

S.NO PARAMETERS ASIAN PAINTS NEROLAC


PAINTS
1. Availability of the product
2. New/innovative packaging
3. Introduction of new products
4. Container size
5. Availability of color
6. Star endorsement
7. Variety
8. Price range

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints


IIPM SALES & DISTRIBUTION MANAGEMENT PROJECT

PAINT SECTOR- ASIAN PAINTS & Nerolac Paints