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Marketing Management II Sales and Distribution Channel Study of Reliance Fresh

Name:-Vipul Kumar

Now it has more than 560 reliance fresh outlets across the country of which 117 are in Delhi and plans to increase this number to 784 to have pan-india presence by 2011. groceries. auto accessories. there was some initial problems post launch due to circumstances prevailing in West Bengal. staples. Company has expanded its supply chain management and it is capable of handling it rapidly growing stores network effectively and efficiently. Reliance retail has decided to reduce its exposure to fruit and vegetable business and position itself as a pure play super market and will focus oncategories like food.In 2008-09.High quality products are offered to the customers having better shelf life and more consistent quality. FMCG. Reliance plans to invest Rs 25000 crores in the next 4 years in their retail division.RRL launched its first store in Hyderabad in November 2006.06 crores and reported a loss of Rs 249. Orissa and U. fresh juice bars dairy products and nonvegetarian products.30 crores.When stores were launched. a fully subsidiary of Reliance Industries Limited. major focus was on selling fresh fruits and vegetables at lower prices by eliminating the middle men and intermediaries. These stores sell fresh fruits and vegetables. size varying from 2000-4000 sq ft. with food accounting for most of its business. Reliance fresh limited had a turnover of Rs 1778.P.Introduction Reliance Fresh is the convenience store format which a part of Reliance Retail limited. .Stores. are located in the radius of 1-2 km of each other providing a good coverage of the area.

 They are submitted to Collection Centres (CC) like Baktawar Pur. . Panipat. Hapur.  If the capacity is not fulfilled by the collection centre then National sourcing is used  This leads us to the next and final step in the process. i.  From CC they are transferred to Distribution Centres (DC) via Reliance own logistical units. the local Reliance Fresh stores.  Payment and quality checks are done in collection centres.Patodi.Structure of Channel  The vegetables are collected in villages from farmers directly.e. Khewrada. Kundli is the DC for Delhi/NCR.etc.

the consumption has fallen. Till evening the stock is indistribution centres. This has made the volume fall to 70-80 tons. Reliance earlier has a logistics company which used to provide man power as well as transportation of goods. Almost65% of the volume bought is from Collection Centres and warehouses. At night it is transhipped to the local store. If the requirement is not met through farmers then the additional goods are brought directly from mandi at a 3-4% cheaper rate from the usual mandi rate. but due to rising prices of vegetables. the rest 35 % is procured from mandis. But now the logistics company is no longer in place. The farmers are paid less than the prevailing rates in mandi. Some of the company owned trucks of logistics company . Movement of Goods (Logistics) Reliance itself pays for all logistics from the collection centre to the retail stores. The distribution centre and the local stores are rent based. So there is a delay of one day from farm to the stores which are 113 in New Delhi.The order for new vegetables has to be placed one day before. Daily rates are monitored. The total volume entering in NCR is at average around 100 tons.

Members and their Roles Farmers: The farmers harvest the crop and bring it to the collection centre. Whenever there is a shortage in supply from any region then.are used for transportation along with other trucks on rent based system from a third party vendor. He inspects the quality and takes in the vegetables. National Sourcing: In order to provide a constant supply of all perishable vegetables warehouses have been bought where goods are kept in cold storage. This gives Reliance a competitive edge. Ratlam. Collection Centre: One Reliance authorized person is in charge of collection centre. Eg. He ensures the loading of all vegetables in the trucks which are sent to the DC. Potatoes in Agra and Shahbad. It also ensures that they buy at the cheapest rate and sell itout when the rates are considerable higher. They save on the transportation cost they would incur in taking the vegetables to the mandi. . these warehouses takeover and start supplying goods. Jaipur. Tomatoes are stored in Nasik. He is also responsible for payment of the farmers.

Due to rise in prices the volume has dropped as it was earlier about 100 tonnes per day. Management Policies If the store owners are able to reach their target then there is a monetary award and recognition. Quantum of Volumes The total volumes procured per day is currently about 70-80 tonnes. This resulted in a Reliance de-hiring all its stores. It is worked on monthly percentage increase in the sales. This resulted in a loss of Rs 200 crore in tax payments to the UP government. They prepare the vegetables for the retail stores and also ship the vegetables depending on the requirement for each store. Distribution Centre: The distribution centre receives the vegetables and does a thorough quality check. This is the figure for last two months.Mandi: A team of two people is situated at the mandi. These teams are responsible for constantly monitoring the rates and communicating the same to the head office. If there is an urgent need which cannot be fulfilled by the collection centre then reliance purchases the supply directly from mandi but at a rate which is 3%-4% less than the actual mandi rate. Retail Stores: They are just responsible for receiving and checking the quantity of vegetables arriving each night. The customers are offered services like home delivery on orders exceeding Rs 500 Conflicts The stores in Uttar Pradesh had closed because of protests from the local vendors. Then they put up all good vegetables on display for customers. The latest internal news is that Mayawati has sent her top IAS officers to Mumbai to woo Reliance Fresh back in Uttar Pradesh .