Professional Documents
Culture Documents
Britannia has 4 production or manufacturing outlets which are in Delhi Calcutta Chennai Rudrapur in Uttaranchal Gwalior which are owned
by Britannia and employees more than 4400 people Besides its self owned units Britannia also uses the facility of more than 60 contract
points for biscuits breads cakes etc where in the labour used for manufacturing is not owned by Britannia but the technology and raw
materials are provided by Britannia itself
In this project we are analyzing the distribution network for Britannia biscuits for Delhi
The first rung in the distribution network for Britannia is the transport of the goods from the manufacturing plants in Delhi to the 2 CFA s
carrying and forwarding agents located at Neb Sarai and the other one at Mundka mother depot
The CFA maintain the inventory on behalf of the company and when the goods are supplied from Britannia to the CFA s it is not considered
a sale but a transfer and therefore there is no change in ownership CFA gets commission on the basis of transaction i e on no of boxes held
in the inventory CFA has to bear labour cost and his godown cost The cost of transport from the company to CFA is born by Britannia itself
And the cost of transport from the CFA to distributor is also borne by Britannia only
One of the reason that Britannia uses the facility for CFA is that because of its wide spread sales all over India and with one production unit
not manufacturing all the variety itself so through the channel CFA Britannia manages to save a lot of behalf of not having to pay central
sales tax 4 So therefore for example if 50 50 is manufactured only in Calcutta than it can be sent to the CFA in Delhi as well as other state
CFA without having to pay 4 CST
The second rung in the distribution network for Britannia are the authorized distributors and authorized wholesalers as termed by a
company rep In total there are 54 authorized distributors in Delhi and NCR
Britannia does not incorporate stockist in its distribution network because of the large number of distributors already present in the network
which are sufficient to cover the wide regions Distributors have their own sales force labour transportation facility Each salesperson allowed
covering max of 40 outlets everyday The reason is that it is felt that it is not within human capacity to cover more than 40 outlets a day and if
done so then the salesperson might be exhausted enough and not spend enough time on each counter required by him for building up
relations with the shopkeeper
Distributor s salesperson is the one who takes orders from the retailer and wholesaler He goes once a week to all the retailers and
wholesalers in his territory to take the orders and gives that order to the distributor Distributor assesses his stock situation and all short stock
is ordered to the CFA keeping in mind the minimum order limits
The areas for the Distributors are divided in such a manner to prevent overlapping if overlapping is found then penalty ranging from
Rs11000 Rs 21000 can be charged to that particular distributor Max 0 4 of the total invoice bill of the distributor is allowed as replacement
by the company
The distributor is also given a certain amount of monthly sales target by Britannia The cost of transport from the distributor to the retailer
wholesaler is borne by the distributor itself Distributors sell mainly in cash and it is very rare to have credit sales and that also for those who
have a long term relationship with the distributor
The margin for the authorized distributor is of approximately 4 5 5 and after expenses like labor transportation etc he is left with a margin of
2 2 25
In case of selling to wholesaler distributor passes on 1 of his margin to the wholesaler This is done by giving the wholesaler a discount on
the billing rate Billing rate is the rate at which the distributor sells to the retailer