Sales and Distibution - Maha Cement

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CHAPTER-1
DESIGN OF THE STUDY
Narasaraopeta Engineering College Page 1

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INTRODUCTION
Marketing & Distribution strategies is considered to be very specialised
division in any organization .It is one of the four elements of marketing mix. An
organization or set of organizations (go-betweens) involved in the process of
making a product or service available for use or consumption by a consumer or
business user.
Meaning of sales:
Sales management is a sub-system of marketing management. It is
sales management that translates the marketing plan into marketing performance.
That is why sales management is sometimes described as the muscle behind
marketing management. Actually, sales management does much more than serving
as the muscle behind marketing management.
According to E. F. L. Brech, “sales management is the overall

management of sales and it refers to only specialised application of the process of
management as a whole”
Marketing is indeed in ancient at: it has been practiced in one form or the
other, since the days of Adam and Eve today, it has become the most vital
function in the world of business.
What is a market?
1. Place concept: a marketing may be considered as a convenient meeting place
where buyers and sellers gathers for exchange of goods e.g., a spot, cash or physical
market.
2. Area concept: it is the economic concept. Any area providing a set of price
making forces may become a market: we need three conditions: (1) unmet wants.
2. Products to meets this demand.(3) means of interaction or intercommunications

that forces of demand and supply can interact to determine the prices even without
face- to –face meeting of seller and buyer. We have now even global means of
communications at our disposal. Hence, we can have national and global markets
for many products. Of course, money and intermediaries are there to facilitate all
marketing operations. The meeting place is not necessary; it is a matter of
convenience only. Money has no such central meeting place.

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3. Demand concept: Today a market is equated with the total demand. Hence,
market means a group of people having unmet wants purchasing power to make
their demand effective and the will to spend their income to fulfill those wants. This
is considered a good approach to define a target market or a market segment.
Under keen competition, a marketer wants to create or capture and retain the
market (customer demand) through an appropriate marketing mix offered to a target
market. The market offering (supply) must meet fully customer demand, i.e., unmet
needs and desires. Under the, marker-oriented approach (marketing concept)
demand concept of market assumes unique importance.
Objectives managing sales:
The objectives of sales management are:
Objectives managing sales
Establishing the distribution set-up

Maximisation of sales
Maximisation of profits
Increasing Market share
Ensuring equity of shareholders
Establishing the distribution set-up: - The basic objective of the sales

management is always the distribution and sales of the products
manufactured/traded by the firm. The sales management’s task would be to set up
such distribution which would accomplish following objectives:
i. Selling through the factory outlet only,

ii. Selling through one distributor/multi-distributor points,
iii. Selling through company owned showrooms,
iv. Selling through the dealers, retailers, dealers, stockiest at rural/urban
markets, and,
v. Arranging logistics help for such distribution set-up would also be the scope
of sales management.

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Maximisation of sales: - the full capacity utilisation of the plants set up the
organisation is always the major objective of sales management. The organisations
are established after a care full study by the research teams about the following
factors:
i. The total demand of the product,

ii. The shares of major competitors in that product,
iii. The impact of substitution on that product,
iv. The production levels required for such market share, and
v. The other evidence support required by the firm to achieve the objective is
then set up.
Maximisations of profits:
-The objective of the sales management would be to ensure that products are
sold at a price that realises profits for the organisation. The expenses involved in
maximising sales are kept under control to ensue each product/ division makes
positive contributions, besides the levels of such contributions are maintained even
when the sales grow in future. The profitability of the investment made at all levels
must keep pace.
Increasing Market share: -

The brand equity and the placement of any product in the market place is
always the deciding factor for the price realisation from that market. It is not
necessary that low price would attain higher market shares but it is definitely certain
that higher market share can help the firm commands a better price from that
market, at least till the others catch up with the firm, in their demand.
Ensuring equity of shareholders: -

Although the management of the equity is the task assigned to the secretarial
department, the sales management plays a very large role in ensuring the equi9ty
invested by the shareholders giving adequate returns to them.

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TYPES OF MARKETS
(1)On the basis of selling area, we have local, national and international markets.
(2) On the basis of article of trade, we have product markets, e.g., cotton market,
bullion market.
(3)On the basis of nature of exchange dealings, we have spot or cash market and
future or forward market.
(4) On the basis of nature of goods sold, we have consumer goods market and
industrial goods market.
(5) On the basis of period we have short, term and long term markets, e.g.,. Money
market for short-term funds and capital market for long-term funds.
(6) On the basis of nature and magnitude of selling, we have wholesales and retail
markets.

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OBJECTIVES OF THE STUDY
 To study the Distributor satisfaction about the KCP cement products and
operations.
 To study the strategies followed by KCP cement company in distribution
network
 To study issues faced by distributors and supply chain management system.
 To study the distributor brand preference comparing to other cement
company products.
 To make recommendations in all areas of sales &distribution.
 To present the theoretical framework of sales & distribution.
 To study distribution channels both in domestic & international market.

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SCOPE OF THE STUDY
 The project study “Sales And Distribution” provides an insight into the
different parameters of distributor satisfaction levels.
 The study helps that make people to purchase, thereby providing a clear
picture to the manufacturer and the dealer of KCP Cement india Ltd
 The ways to attract and retain the customer for the survival and growth.
 It is also intended to understand the customer tastes preferences and buying
behaviour in buying the product in the available prices segments.
 The study is detailed mainly towards the promotion the product.
 The company was easier to know the advertisements impact on the customer
in buying the product.

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RESEARCH METHODOLOGY
Design of the Study:
Project has based on study of the market research of the products of KCP
Cement and its competitors, this projects need to go with very specific way so that
the company come to conclusion whether to carry on with the same strategies or
not.
Survey and Data Collection
Data has collected from retailers, dealers, distributor by visiting them and
shops
Sample size :-100 members working as dealers, distributors ,agents, and Shop
owners in cement industry
Data collection was done with the help of a self developed questionnaire, designed
for distributors.
Data collection
a) Primary Data
The primary data in concern to market research was collected from actual visit
to dealer, distributor at every level and retailers interviews with the help of self
designed Questioner. Also collection of data from organization staff member.
1. Structured questionnaire
2. And unstructured face to face interview
b) Secondary Data
Secondary data has collected from the Internet websites, books and
magazines to understand the overall current status of the Cement industries in India
and on the basis of secondary information Questioner was prepared under the
guidance of company project guide.
Company brochure: KCP Cement.
Booklet of dealer
Marketing research: Tull and Hawkings
Marketing Research: G.C.Beri

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NEED OF THE STUDY
 This project gives importance of Sales & Distribution division and hence the
study helpful for changes in KCP Cement Sales & Distribution system.
 To know about Sales & Distribution is why essential element to operational
efficiency which is production companies like KCP cement.
 To know The process Sales & Distribution can be applied to customer
satisfaction and company success
 Coming to the study it would be appropriate to analyze each organizations
actions and strategies to grab more market share, get more profits and derive
who is going to be the market leader
 to know how In this competitive world people are more conscious about
their product availability and Sales & Distribution system

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LIMITATIONS OF THE STUDY
 Survey has been done in the limited area of Hyderabad city.

 Conducted survey on random sampling basis.
 Some authority doesn’t allow carrying out survey; such industries are omitted
from sample set.
 Very few company allow to give personal details of their company. For other
information have to depends upon what data given by authority.
 Concerned person is not always available

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CHAPTER-2
INDUSTRY PROFILE

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INDUSTRY PROFILE
Introduction:
The Indian Cement industry is the second largest cement producer in the
world, with an installed capacity of 144 million tones. The industry has undergone
rapid technological up gradation and vibrant growth during the last two decades,
and some of the plants can be compared in every respect with the best operating
plants in the world. The industry is highly energy intensive and the energy bill in
some of the plants is as high as 60% of cement manufacturing cost. Although the
newer plants are equipped with the latest state-of-the-art equipment, there exists
substantial scope for reduction in energy consumption in many of the older plants
adopting various energy conservation measures.
The Indian cement industry is a mixture of mini and large capacity cement
plants, ranging in unit capacity per kiln as low as 10 tpd to as high as 7500 tpd.
Majority of the production of cement in the country (94%) is by large plants, which
are defined as plants having capacity of more than 600 tpd. At present there are 124
large rotary kiln plants in the country. The Ordinary Portland Cement (OPC) enjoys
the major share (56%) of the total cement production in India followed by Portland
Pozzolana Cement (PPC) and Portland Slag Cement (PSC).
A positive trend towards the increased use of blended cement can be seen
with the share of blended cement increasing to 43%. There is regional imbalance in
cement production in India due to the limitations posed by raw material and fuel
sources. Most of the cements plants in India are located in proximity to the raw
material sources, exploiting the natural resources to the full extent. The southern
region is the most cement rich region while other regions have almost same cement
production capacity.
The Indian cement industry is about 90 years old and its main sources of
energy are thermal and electrical energy. The thermal energy is generally obtained
from coal, and the electrical energy is obtained either from grid or captive power
plants of the individual manufacturing units.

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History of Indian Cement Industry

By stating production in 1914 the story of story of Indian cement is a stage of
continuous growth. Cement is derived from the Latin word “cementam”. Egyptians
and Romans found the process of manufacturing cement. In England during the
first century the hydraulic cement has become more versatile building material.
Later on, Portland cement was invented and the invention was usually attributed to
Joseph Aspdin of Enland.
India is the world’s 4th largest cement produced after China, Japan and U.S.A. The
South Industries have produced cement for the first time in 1904. The company
was setup in Chennai with the installed capacity of 30 tonnes per day. Since then
the cement industry has progressing leaps and bounds and evolved into the most
basic and progressive industry. Till 1950-1951, the capacity of production was
only 3.3 million tonnes. So far annual production and demand have been growing a
pace at roughly 78 million tonnes with an installed capacity of 87 million tonnes.
In the remaining two years of 8th plan an additional capacity of 23 million
tonnes will actually come up. India is well endowed with cement grade limestone
(90 billion tonnes) and coal (190) billion tonnes). During the nineties it had a
particularly impressive expansion with growth rate of 10 percent.
The strength and vitality of Indian Cement Industry can be gauged by the interest
shown and support gives by World Bank, considering the excellent performance of
the industry in utilizing the loans and achieving the objectives and targets. The
World Bank is examining the feasibility of providing a third line of credit for further
upgrading the industry in varying areas, which will make it global. With
liberalization policies of Indian Government, the industry is posed for a high growth
rates in nineties and the installed capacity is expected to cross 100 million tonnes
and production 90 million tonnes by 2003 AD. The industry has fabulous scope for
exporting its product to countries like the U.S.A., U.K., Bangladesh Nepal and other
several countries. But there are not enough wagons to transport cement for
shipment.

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Composition of Cement:
The ordinary cement contains two basic ingredients, namely, argillaceous
and calcareous. In argillaceous materials the clayey predominates and in calcareous
materials the calcium carbonate predominates. A good chemical analysis of
ordinary cement along with desired range of ingredient
Ingredients Percent Range
Lime (Capo) 62 62-67
Silica (SiO2) 22 17-25
Alumina (Al2O3) 5 3-8
Calcium sulphate (CaSO4) 4 3-4
Iron Oxide (Fe2O3) 3 3-4
Magnesia (MgO) 2 1-3
Sulphur (S) 1 1-3
Alkalies 1 0.2-1
Cement – The Product

The natural cement is obtained by burning and crushing the stones
containing clayey, carbonate of lime and some amount of carbonate of magnesia.
The natural cement is brown in color and its best variety is known as “ROMAN
CEMENT”. It sets very quickly after addition of water. It was in the eighteenth
century that the most important advances in the development of cement were which
finally led to the invention of Portland cement.
In 1756, John Smeaton showed that hydraulic lime which can resist the
action of water can be obtained not only from hard lime stone but rom a limestone
which contain substantial proportion of clayey.
In 1796, Joseph Parker found that modules of argillaceous limestone made
excellent hydraulic cement when burned in the usual manner. After burning the
product was reduced to a powder. This started the natural cement industry.

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The artificial cement is obtained by burning at a very high temperature a

mixture of calcareous and argillaceous material. The mixture of ingredients should
be intimate and they should be in correct proportion. The calcined product is
known as clinker. A small quantity of gypsum is added to clinker and it is then
pulverized into very fine powder, which is known as cement.
The common variety of artificial cement is known as normal setting cement
or ordinary cement. A mason Joseph Aspdn of Leeds of England invented this
cement in 1824. He took out a patent for this cement called it “PORTLAND
CEMENT” because it had resemblance in its color after setting to a variety of
sandstone, which is found abundance in Portland England. The manufacture of
Portland cement was started in England around 1825.
The first cement factory installed in Tamilnadu in 1904 by South India
limited and then onwards a number of factories manufacturing cement were started.
At present there are more than 150 factories producing different types of cements.
Industry Structure and Development:
With a capacity of 115 million tonnes of large cement plants, Indian cement
industry is the fourth largest in the world. However per capita consumption in our
country is still at only 100 Kgs against 300 Kgs of developed countries and offers
significant potential for growth of cement consumption as well as addition to
cement capacity. The recent economic policy announcement by the government in
respect of housing, roads, power etc., will increase cement consumption.
CURRENT SCENARIO:
The cement industry occupies an important place in the national economy
because its strong linking to other sectors such as construction, transaction, coal and
power the cement industry as also one of the major contributors to the chequer by
way of indirect taxes.
Cement production during April to January 2009-10 was 130.67 MT as
compared to 115.52 MT during the same period for the same year 2008-09 over the
last few years, the Indian cement industry witness strong growth with demand
reporting a compounded annual growth rate of 9.3% and capacity addition a CAGR
of 5.6% between 2005-06 and 2008-09.
FDI
Presently 100% FDI is permitted in the Indian cement industry.

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ROLE OF CEMENT INDUSTRY IN INDIA GDP-FACTS:

 The Indian cement industry is one of the booming sectors of the Indian economy.
 He infrastructure development of country in the recent years is the demand.
 Drive for the cement industry.
 The Indian cement industry is experiencing the entry of many foreign players in the
Indian market.
 The average monthly capacity utilization during the year 2008 to 2009 was 95%
 The cement dispatches in the year 2008-09 was 157 MT
 India ranks second in the production.
Major competitors of the industry
 The KCP ltd (cement unite)

 Bhavya cements ltd
 Kesoram cements ltd
 Priyadarashini cements ltd
 Sri Vishnu cements ltd
 Kakatiya cements ltd
 NCL industries ltd
 Orient cement
 Parasakthi cements ltd
 Bhavya cements ltd
 Sagar cements ltd
 Deccan cements ltd
 Andhra cements ltd
 J.P. cements ltd
 Bharathi cements ltd
 A.C.C. ltd
 The India cements ltd
 Zuvari cements ltd
 Sri chakra cements ltd

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CEMENT COMPANIES IN INDIA:
S.NO STATE NO OF CEMENT PLANTS

01 ASSAM 1
02 ANDHRA PRADESH 19
03 BIHAR 7
04 DELHI 1
05 GUJARAT 13
06 HARYANA 2
07 HIMACHAL PRADESH 4
08 JAMMU KASMIR 1
09 KARNATAKA 9
10 KERLA 1
Problems of the industry:

The main impediments to the growth of cement industry in India may be broadly
listed as follows.
Shortage of capital:
The cement industry is the capital intensive in nature. On the account of its
record of declining profitability. It is unable to trace the required finance from the
capital market.
Power Shortage:
Cement industry is also power intensive frequent power cut effects on
the production. Through many units try to tied over the power crisis by installing
their own generators, seem to suffer loss due to high cost of such an effort. It is
estimated that 50.55% of total manufacturing cost related to power. In 1989-90
merely 17% of total cement production with the country were captive power at high
cost.
Location Problem:
Cement industries are mainly situated in the western and southern regions
production about 71% of the output while the northern and southern regions. Those
factors lead to heavy transport cost.

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Shortage of coal:
Coal shortage effects production of cement industry resulting in the capacity
and under utilization of capacity. The impurities and low quality of coal affects the
furnace and quality of cement. The coal supplied to cement unit has regard an ash
content up to 57% and the calorific value of 3000 an even less against the calorific
value of 4500-6500 of improved coal.
Non –availability of Railway wagon:

Non-availability of railway wagons leads to considerable delay in bringing
in the raw materials and in dispatching the cement to various potential markets.
Sending cement by open railway wagon leads to pilferage and damage by rail and
45% of by roads.
Defective methods of transport:
Methods of cement bagging and its transportation in India are primitive
which make marketing in effecting an uneconomically hardly a quality of cement at
present is handled in bulk.
Negligible Share in the World Trade:
Indian’s share in world is negligible currently India exports only about 3.5
lakhs tones in a year.
Technological absolve:
The industry is needed to change in the production process. There is need for
conversion from wet process to dry process. It needs an investment exceeding
Rs.200/- crows. If the industry tries doesn’t learn reasonable profit institutional
finance also becomes difficult. The other factors that affect the cost of production
and the profitability of the industry a
i. Price inverse in critical emerge inputs such as coal, power, light etc.
ii. Higher wages and lower labor productivity.
iii. Royalty and other levies and public leaves of Royalty and mineral lights as
constituted 60-70% of limestone in AP.
iv. Lower capacity utilization where higher capacity utilization has been.
v. High capital and financing cost of the new plants owing to high import duty for
plant and machinery as well as high cost of steam and increase in the freight charges
over the period.

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Cement Export Prospects:

Indian cement is exported mainly to Nepal, Bangladesh, and small partition
to silence through export enquiries for about one million tone are on hand with
Indian with hug. Domestic demand exports have taken a backseat. Substantial
export can be achieved if 100% EOW of setup in the coastal area. These units
would have the benefit of the project’s cost due to the concession import.
Recent Scenario of Cement Industry In India:

The cement industry was one of the industries to be liveried in 1980. The
government partially decontrolled the cement industry in 1982 followed by the total
decontrol in 1989. The cement industry has witnessed spectacular progress mainly
due to the forces of the economic liberalizations and the jettisoning of the price
controls of the capacity restrictions.
These act generated tremendous interest with and within decade nearly 30
millions tones capacity works added to the extending cement which checked price
raise. To add to the healthy competition among the place improved the quality of
cement.
This turn has helped the Indian cement industry to continues its impressive
performance over the years. During the fiscal year 1955-56, cement production
touched a new peak of 69 million tones as against 62.4 million tones in the previous
year representing a remarkable growth of 10%.
The year 1955-56 cement production touched a new peak of 69 million tones
as against 62.4 million tones in the previous year representing a remarkable growth
of 10%.
He year 1955-56 witnessed a hoping 12% to increase a demand for cement
the highest ever in the last decade. In the year 1996-97 the demand had continued to
growth at a still high rate. The first quarter has witnessed 14% growth over the
previous year. Considering Government emphasis on improving infrastructure in the
country and the various plans it has announced in the direction. The upward trend of
the cement industry is expected to continue. The Indian cement Industry is the
second large in the world after china’s. In terms of quality productivity and
efficiency, it compares with the best anywhere, it is almost entirely home grown
built indigenously and using locally sourced inputs. In other words, the hardware
and software that ruin the industry are mostly India. Baring one or two exception

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Years, its performance in the last two decades has been quits consistent and
commendable in terms of modernization, expansion, growth in production and
improvement in the productivity and cost efficiency.
According to the Cement Manufacture Association (C.M.A), the industry
has an installed capacity of over 137 million tones from 124 plans of 56 members
companies. Most of the company is modern and based on the energy efficient dry
process technology.
There are as many as 64 plans of million tones or more capacity. However,
the minimum economic size has increased to two million tones a year. The share of
the road of transport of cement is nearly 60% while 39% is moved by rail. In the
recent year, sea routes are used increased to markets on the western coast.
The Indian cement industries play a key role in national economy,
generating substantial revenue for state and central govt. it is third highest country
boaters in terms of exercised duty of over Rs. 3500 crows year. Sales tax yield
around Rs.3200 crows to state govt, royalties and other cases add another Rs.1500
crows. The industry employs a work face has over of 1.5lakh person and supported
father compliment of 12 lakhs people engaged indirectly.
The industry is highly fragmented with a no of flyers by global standards
selling price fluctuates from place to and seasonally. Cement is not a product that
can be easily differentiated. The last few years have seen notable matches an
acquisition in the Indian cement industry. This is slow process. The industry
welcomes to the trend in as much as it involves players. Who are generally
interested in cement as an ongoing business. Secondly, consolidation can bring
about greater efficiency and productivity due to economics of scale that should
ultimately benefits of consumers.
Opportunities and Threats
In view of low per capita consumption in India, there is a considerable scope for
growth in cement consumption and creation of new capacities in coming years. The
cement industry does not appear to have adequately exploited cement consumption
in rural segment where damaged where damaged growth is possible. Landed cost of
cement (with import duty) continues to be higher than home market prices but with
reduced import duty, increasing imports, may pose a serious threat to the domestic
cement industry.

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Risks and Concerns

Slow down of Indian economy or drop in growth rate of agriculture may
adversely affect the consumption. The recent increase in railway freight coupled
with diesel / petrol price like will increase the cost of production and distribution, as
being bulky, cement is freight intensive increase in Limestone royalty also adds to
the cost of production, which is considerably higher than corresponding costs of
many other developing countries.
In our country there is a need to undertake a massive programme of house
construction activity into the rural and urban areas. It is impossible to construct a
house without cement and steel, in other words, cement is one of the basic
construction materials and therefore it is one of the vital elements for the economic
development of the nation
Salient features of Indian cement industry
Indian cement industry is the second largest in the world with an installed
capacity of 135 MTPA. It accounts for nearly 6% of the world production. There are
124 large plants and around 365 mini plants. The industry presents a mixed picture
with many new plants that employ state-of-the-art dry process technology and a few
old wet process plants having wet process kilns.
Production from large plants (with capacity above 1 MTPA) account for
85% of the total production. The cement industry has achieved significant progress
in terms of reducing the overall energy intensity. Dry process plants that the
weighted average thermal energy consumption was 734 kCal/kg clinkers, and
weighted average electrical energy consumption was 89 kWh/tone of cement. The
best energy consumption is 692 kCal/kg. Clinker and 66 kWh/ton of cement.
Quantitative details:
The energy intensity of the all the dry process plants (cost of energy as
percentage of total production cost of packed cement) varies from 29 to 61%. This
is observed to vary with the vintage of the plant, the technology employed by the
plants and the type of cement produced.
Specific thermal and electrical energy consumption for the plants ranges
between 692 – 879 kCal/kg. Of clinker and 66 – 127 kWh/ton of cement produced
(product mix) respectively. The specific electrical energy also includes the energy
consumed in packing.

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Plant utilities and plant lighting. The reasons for wide range in specific
energy consumption can be mainly attributed to the differing equipment
configuration employed in different sections of the plants by various cement plants.
For example, plants employing ball mills for grinding have reported higher specific
electrical energy consumption as compared to plants having vertical roller mills.
In addition, other factors like the plant capacity, its capacity utilization,
vintage, product mix, process control system, maintenance aspects, raw material
characteristics and above all the management’s attitude and operational practices of
plant personnel are also important. Besides, various external parameters like quality
of coal, raw materials and power supply have their own repercussions. A large
number of plants have put in vertical roller mills for raw meal section. The balls
mills are still operating in the clinker grinding and coal milling sections in some of
the plants. Some of the newer plants have installed roller press and vertical roller
mills in the clinker grinding section as well.
Comparison of energy performance of Indian cement industry with other
countries reveals that there exists scope for improving the energy performance of
the Indian cement industry. The best reported (as per CMA data) energy
performance figures in the world re 65 kWh/t of cement and
650 kCal/kg of clinker whereas the best in India is 69 kWh/t of cement and 665
kCal/kg of clinker.
This clearly bring out the fact that although we have some of the best plants
in the world in terms of energy performance, there are many plants where there
exists scope for reducing energy Consumption.
Present & Future Scenario of Cement Industry
A typical cyclical industry is normally characterized by the boom – and –
bust syndrome. A huge potential market and rapid growth in the early stages lead to
a surge in interest and a flurry of research. The buoyant markets and huge profits
raked in by players tempt more players into the market. Capacities increase in
excess of demand and guilt in capacity is created. Competition increases, prices fall
and margins come under the pressure.
Capacity addition comes to a halt weaker players should stop shop or sell off
to larger ones. Demand catches up the cyclical industries, the Indian cement
industry exhibits this boom – and bust cycle

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Industry back ground
Cement is the core industry and the product is the basic requirement for the
development of housing and infrastructure. India is the largest producer of cement is
Asia after china, with an installed capacity of more than 142 million tons per year.
This comprises more than 400 major and mini cement plants. However, more than
53% of the installed capacity is controlled by the 6 top players in India. Lime stone
is a major raw material used by the cement industry and based on its availability, the
industry is concentrated in Madhya Pradesh, Andhra Pradesh and Rajasthan. Thus
more than 50% of the installed capacity have come – up in 7 cluster with plenty of
limestone deposits.
The public sector accounts for only 8% of the capacity, as against the private
sector share of 92% of the installed capacity. The southern region had the highest
installed capacity, estimated at around 46 million tons per annum where in Andhra
Pradesh alone accounted for about 21 mtpa
Demand and Supply

Cement is essential and basic input material for the construction activity.
The development of infrastructure is on the top of the Government agenda which
assures good growth for the cement industry in the coming years.
Demand for cement is linked to the economic activity in any country. It can
be categorized into demand for housing construction and infrastructure and hence
cement demand in developing economies is much higher than any developed
countries. The demand for cement is proportionately related to the spending on
infrastructure including housing. In India, housing accounts for about 55% of
cement consumption. After the decontrolling of cement industry, supply and
demand situation has become a sensitive and critical factor in determining the over
all profitability of the industry. Any small imbalance in demand and supply of the
cement results in disproportionate change in the cement prices.
The per capital consumption of cement in India is very low at 99 Kg against
the Asian average of 200 kgs. Over the last 15 years, the consumption of cement by
the Governments has fallen drastically from 15% to 50% creating stiff competition
between the market players. The trend is likely to be reversed in future as the

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Governments focused in infrastructure development like express highways and

other large projects.
Cement Industry – Future Outlook
The Indian cement industry, which is the second largest producer of cement
in the world after China has been resilient even in the face of recession and
continues to expand rapidly. The growth of the cement sector in India has led to
large capacity addition by major players over the past few months. The growth in
the sector is propelled by the boom in the real estate sector, increased government
spending in the infrastructure as well as private sector initiatives.
Fitch Ratings said it sees a stable outlook for Indian construction industry
in 2010 adding that construction material costs – especially steel and cement - will
be at the same level as last year. Traditionally, growth of Indian cement industry has
remained directly proportional to the growth of the country’s economy. However, in
fiscal 2008-09, despite the economic slowdown, India produced around 181 million
metric tonnes (mmt) of cement, representing a growth of around 7.8% over the
fiscal 2007-08. Consumption also increased at the same pace during the last fiscal.
Cement production reached 160.31 million tonnes during FY 2009-10, up

12.37% from 142.65 million tonnes in FY 2008-09, as per the data released by the
Cement Manufacturers Association. Additionally, sales grew by 12% to 159.43
million tonnes from 142.23 million tones. Analysts have forecast substantial growth
in both cement production and consumption during 2009-10 to 2011-12.
Additionally, the housing sector, which accounts for more than 50% of the total
cement consumption in India, is also on a strong growth path, the trend is expected
to continue in coming years.
Over-supply a bane for cement companies

The cement sector added 40 million tonnes of fresh capacity in 2009-
10, which is 1/5th of the total capacity for 2008-09. This has led to the flooding of
the market with supplies way beyond the demand. Going ahead, the problem is
likely to be aggravated with the monsoon season setting in, which traditionally is a
weak demand period.

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In a natural progression in the scheme of things, the month of May saw

over-capacity leading to a decline in per bag cement prices by about Rs 5-10 in
most regions. Analysts have forecast demand pick up after September on higher
government spending on infrastructure projects, as well as investments in the rural
and urban housing segments. Even though this is a positive sign, factors like higher
input costs (increased coal prices), transportation costs, and the lack of pricing
power due to severe competition, are likely to pull down margins for the cement
companies. The initial numbers for cement dispatch in the month of June 2010
points to a low 5% yoy growth. Additionally, with sluggish demand and increasing
supply, prices per bag are believed to have fallen further.
Forecast
The Indian cement industry is projected to grow in the coming years.
Analysts have forecast cement production to increase at round 11% CAGR between
FY 2009-10 and FY 2011-12, to reach nearly 240 mmt. However, for 2QFY11
analysts have forecast a decline in all-India capacity utilization by 800 bps YoY to
72%, which will lead to sharp cuts in cement prices across regions.Going ahead, the
Indian cement industry is forecast to get support from the sustained demand in the
form of government support and infrastructure development. However, a low down
could come from the increasing prices of key inputs like slag, coal, gypsum,
petroleum products and fly ash. The prices are expected to become tougher in the
coming years. Additionally, availability of raw material continues to be a challenge,
which could result in an unfavorable impact on the Indian cement industry.
Government policies
India is the second-largest cement producing country in the world after China. The
country’s cement production was 300 million tonnes in 2010; the figure is expected
to double to reach almost 550 million tonnes by 2020, as per estimates by the
Cement Manufacturers Association (CMA). As of 2011, there were 137 large and
365 mini cement plants in India.
The Indian cement industry is globally competitive with lowest energy consumption
and CO2 emissions. Apart from fulfilling domestic cement requirements, the
industry also exports cement and clinker to around 30 countries across the globe.

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In India, cement demand emanates from four key segments — housing, accounting
for 67%; infrastructure for 13%; commercial construction for 11%; and industrial
sector for 9%. The cement industry has evolved in the form of clusters across the
country due to the location of limestone reserves in certain states. Presently, there
are seven clusters, namely the Satna cluster in Madhya Pradesh; Chandrapur in
north Andhra Pradesh and KCP rashtra; Gulbarga in north Karnataka and east
Andhra Pradesh; Chanderia in south Rajasthan, Jawad and Neemuch in Madhya
Pradesh; Bilaspur in Chattisgarh; Yerraguntla in south Andhra Pradesh and
Nalgonda in central Andhra Pradesh.
During 2009-10, the Indian cement industry grew at a robust rate of 12.7%,
according to CMA. With the government promoting construction activities across
the country through various stimulus packages for building roads, bridges, houses,
etc., the Indian cement industry added a capacity of 37 million tonnes in 2009-10,
which is the highest capacity ever added in any single year so far.
The government’s focus on building infrastructure is likely to continue in the near

future and the Indian cement industry is expected to sustain an even higher growth
rate of 15% over the coming years.
Cement Export Prospects:

Indian cement is exported mainly to Nepal, Bangladesh and small partition
to Srilanka through export enquiries for about one million tone are on hand with
India with hug Domestic demand export have taken a backseat. Substantial export
can be achieved if 100% EOU of setup in the coastal area. These units would have
the benefit of the projects cost due to the concession import.
Recent scenario of Cement Industry in India:

The cement industry was one of the industries to be liveried in 1980.
The government partially decontrolled the cement industry in 1982 followed by the
total decontrol in 1989. The cement industry has witnessed spectacular progress
mainly due to the forces of the economic liberalizations and the jettisoning of the
price controls of the capacity restrictions. These act generated tremendous interest
with and with in decade nearly 30 millions tones capacity works added to the

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extending cement which checked price raise. To add to the healthy competition
among the place improved the quality of cement.
This turn has helped the Indian cement industry to continue its impressive
performance over the years. During the Fiscal year 1955056, cement production
touched a new peak of 69 million tones as against 62.4 million tones in the previous
year representing a remarkable growth of 10%.
The year 1955-56, cement production touched a new peak of 69 million
tones as against 62.4 million tones in the previous year representing a remarkable
growth of 10%.
The year 1955-56 witnessed a hoping 12% to increase a demand for cement
the highest ever in the last decade. In the year 1996-97 the demand had continued to
growth at a still high rate. The first quarter has witnessed 14% growth over the
previous year. Considering Government emphasis on improving infrastructure in the
country and the various plans it has announced in the direction. The upward trend of
the cement industry is expected to continue.
The Indian cement Industry is the second large in the world after
china’s. In terms of quality productivity and efficiency, it compares with the best
anywhere, it is almost entirely home grown built indigenously and using locally
sourced inputs. In other words, the hardware and software that ruin the industry are
Mostly India. Baring one or two exceptional Years, its performance in the last two
decades has been quits consistent and commendable in terms of modernization,
expansion, growth in production and improvement in the productivity and cost
efficiency.
According to the Cement Manufacture Association (C.M.A), the industry
has an installed capacity of over 137 million tones from 124 plans of 56 members
companies. Most of the company is modern and based on the energy efficient dry
process technology.
There are as many as 64 plans of million tones or more capacity. However,
the minimum economic size has increased to two million tones a year. The share of
the road of transport of cement is nearly 60% while 39% is moved by rail. In the
recent year, sea routes are used increased to markets on the western coast.
The Indian cement industries play a key role in national economy,
generating substantial revenue for state and central govt. It is third highest country
boaters in terms of exercised duty of over Rs.3500 crows year. Sales

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tax yield around Rs.3200 crows to state govt. royalties and other cases add another
Rs.1500 crows. The industry employs a work face has over of 1.5lakh person and
supported father compliment of 12lakhs people engaged indirectly.
The industry is highly fragmented with a no. Of flyers by global standards
selling price fluctuates from place to and seasonally. Cement is not a product that
can be easily differentiated.
The last few years have seen notable matches an acquisition in the Indian
cement industry. This is slow process. The industry welcomes to the trend in as
much as it involves players. Who are Jana rally interested in cement as an ongoing
business.
Suggestions
Suggestions for Optimum Utilization of Capacity in Cement Industry The
licensed capacity of the cement industry should not be enhanced any more. An
enhancement in the installed capacity alone is not going to deliver goods. Installed
capacity should be enhanced only up to a limited extent . The optimum level of
capacity is expected to be achieved at 90 percent realization of its installed capacity
and the National Planning Commission has approved of this concept for all practical
purposes. The percentage of levy-cement may be reduced by the Government with a
view to providing an added incentive to the industry for increasing the productivity .
The individual cement units are permitted to establish their own mini power stations
to meet their requirement of power supply. . Priority of the first order that adequate
and timely coal supplies be maintained to the industry to ensure the progress
uninterrupted .

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COMPANY PROFILE
The year was 1941 India was under the imperial rules and independence was
an idea whose time had still not come. KCP’s genesis took place against this
backdrop. Sri Velagapudi Ramakrishna, a pioneer with a vision for a prosperous,
strong and industrialized India, relinquished his secure job with the ICS and set up a
sugar plant. Driven by a nationalistic fervor, he turned his vision to reality as this
company grew from sugar, to cement, heavy engineering, power and beyond. This
was the KCP Group. A true Indian business conglomerate had arrived.
The KCP Group’s philosophy is ‘Modernize. Indigenize. Never compromise

on technology’. From a single sugar factory, KICP has grown into a group of
companies, presently worth US$ 50 million.
KCP Heavy Engineering Division, set up in 1955, is located close to the

Chennai port. An integrated manufacturing facility that makes a range of heavy
mechanical equipment and sub systems for the core sector industries, KCP Heavy
Engineering has one of the largest, well integrated factories of its kind. KCP has an
enviable track record in the heavy engineering industry in the domestic and
international market and offers a wide range of products such as:
- Sugar Machinery
- Cement machinery
- Mineral Processing Equipment
- Chemical & Fertilizer Plant Equipment
- Steel Plant Equipment
KCP’s state of the art cement manufacturing plant at Macherla, Andhra Pradesh ahs
an enhanced production capacity of over 5,00,000tonnes per annum. India’s first dry
process kiln was installed here in 1958 by Himboldt, Germany while it was still a
prototype in Europe. In 1962 KCP installed a second wet process kiln in
collaboration with Fives Lille Cail, France. The finest illustration of KCP’s success
in cement technology is the NagarjunaSagar dam that straddles the turbulent

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Krishna river – a project that used 1.34 million metric tones of cement
manufactured at KCP’s Macherla Plant.
Today, KCP has a 100% modernized plant, with a World Bank funded outlay of Rs.
367 million, that incorporates latest technologies like the energy when the
government of Andhra Pradesh allowed private enterprises to generate their own
power, KCP quickly rose to the challenge by establishing mini hydel projects on the
Guntur Canal – an effective way to generate power from 5 different canal drops.
Four of these power projects generate 1.5 megawatts of power and the fifth one
generates 2.25 megawatts.
The plant has been operational since 1999. The design of these power projects
efficient dry process, with a two support kiln and a 5 stage pre-heater with flash
calciner. KCP Cement also has a sophisticated centralized process control system
with the hardware and software from Siemens, Germany.
Amidst all its success, KCP Cement is genuinely concerned with the environment,
which has resulted in the implementation of eco-friendly manufacturing processes.
To this effect, KCP Cement also has several industrial awards for safety and
pollution control.
Acknowledged by cement experts as the finest quality premium cement, KCP

Cement is very much in demand for critical construction projects in India, which is
testimony to KCP’s obsession with quality. Stringent testing protocols and
sophisticated equipment ensure quality control right from the selection and blending
of law materials to the analysis of end products. KCP cements are supplied in the
following grades.
 53 Grade Ordinary Portland Cement

 43 Grade ordinary Portland Cement
 KCP Garuda 53 Portland Pozzolana Cement
 KCP Duro High Durability Cement.

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The Quality Management System of this unit, has been approved by “LLYORDS’
Register of Quality Assurance’ to the Quality management System Standards – BS
EN ISO 9001:2009 IS/ISO 9002:2000. the Quality management System is
applicable ot the ‘Manufacture and Sale of Ordinary Portland cem`ent. Blended
cement and Special cements to customer specifications’. KCP’s rigorous adherence
to quality has created a reputation for itself in the market for assured safety.
With its technological edge and years of experience, KCP cement is a clear leader in
the cement industry. Today, customers insist on using KCP cement for RCC
columns, roofs and load bearing structures. Its extensive usage in pre-stressed
concrete elements also accounts for its premier position is unique and allows, for
instance, the flow of water in the by-pass canal when the gates of the power houses
are closed. The project, therefore, has not obstructed the ecological balance in the
environment, but has, in fact, enhanced it.
In addition, all of these projects feature turbines of the ‘Semi Kaplan Variant’ type
which are first of their kind in India. Owing to such innovations, the cost of
generating power is less than any other mini Hydel scheme in Andhra Pradesh.
KCP’s Hydel Projects are a clear illustration of the company’s commitment to the
environment.
Human Resource Position as on 31.05.2016
Permanent Employees
Officers - 91
Staff - 62
Workers - 130
Trainees: 38
85
Act. Apprentices- 47

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Contract Labors
Cement Loaders - 42
Plant - 235 Permanent

Mines - 48 Permanent
Total - 283
Compensation Particulars
Staff wages as on 31.05.2018
7Grade 6Grade 5Grade 4Grade 3Grade 2Grade 1Grade TC
Basic 2464.00 2435.00 2406.00 2377.00 2274.00 2251.00 2228.00 2140.00
V.D.A 11007.45 11007.45 11007.45 11007.45 11007.45 11007.45 11007.45 11007.00
%D.A 123.20 121.75 120.30 118.85 113.70 112.55 111.40 107.00
1880.00
H.R.A. 1875.00 1875.00 1865.00 1695.00 1685.00 1685.00 1510.00
End.
690.00 690.00 690.00 690.00 635.00 635.00 635.00 575.00
Allowance
Special. pay/
440.00 440.00 440.00 440.00 380.00 380.00 380.00 320.00
Adl.Pay
Convex.
450.00 450.00 450.00 450.00 450.00 450.00 450.00 450.00
Allowance
Wash.
375.00 375.00 375.00 375.00 335.00 335.00 335.00 300.00
Allowance
L.T.A 265.00 265.00 265.00 265.00 265.00 265.00 .26500 265.00
Total Rs. 17694.65 17659.20 17628.75 17588.20 17188.15 17121.00 17096.85 16674.45

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Staff, clerical salary as on 31.05.2018
Workers’ wages as on 31.05.2018
A Grade B Grade C Grade D Grade E Grade
Basic 2238.00 2192.00 2109.00 2071.00 2057.00
V. D.A 10998.95 10998.85 10998.95 10998.95 10998.95
%D.A. 111.90 109.60 105.45 51.78 0
H.R.A. 1520.00 1520.00 1395.00 1375.00 1375.00
L.T.A. 265.00 265.00 265.00 265.00 265.00
Convex.
450.00 450.00 450.00 450.00 450.00
Allowance
End.
575.00 575.00 542.00 535.00 535.00
Allowance
Wash.
300.00 300.00 275.00 270.00 270.00
Allowance
Special Pay 320.00 320.00 290.00 280.00 280.00
Total Rs. 16778.85 16730.55 16430.40 16296.73 16230.95

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Marketing at KCP:-
At KCP marketing of cement will be done by their Cement Marketing
Division, Hyderabad with General Manager (Marketing) as head of the department
and Sr. RMM, RMMs, Sr. M.Os, M.Os located in different parts of the country will
be under his control. They have operation at Andhra Pradesh, Tamilnadu, Karnataka
and Kerala states. They have dealer and builder network in every district. Their
dealer network in coastal districts of Andhra Pradesh is very strong. They are brand
leaders in Guntur, Krishna, Prakasam, Nalgonda and Nellore districts. The
customers in these districts treat KCP as apremium quality product and use for RCC
structures (Pillars, Slabs). In some areas KCP Cement is also called as SLAB
CEMENT. In these districts customer will pay Rs. 5.00 toRs. 10.00 premium for
KCP Cement. Prestigious NagarjunaSagar Dam stood as landmark for KCP quality.
Authorised dealers who were appointed by the company by taking deposits
will take orders from the customers, place indent to the respective Marketing
Officer, get material from the factory at Macherla and execute the order taken from
the customer. The sale proceeds are collected by way of local cheques or demand
drafts by marketing officers, under the supervision of Regional Marketing
Managers.
The Regional Marketing Managers will give feedback to General Manager
(M) on Day to Day basis who will in turn give necessary guidance for handling the
situation.
KCP in Community:-
Apart from being a business conglomerate, KCP has immense faith in
community building. It has played a significant role in rural upliftment and the
company has various interests that are as diverse as its business channels.
Education
Some of the educational institutions that the KCP Group have helped
establish, funded and managed are:
 Sri.V.Ramakrishna Polytechnic, Tiruvottiyur, Chennai.
 Sri V. Ramakrishna Higher Secondary School, Tiruvottiyur, Chennai.
 Kids Patasala, Macherla.
 KCP Adarsh Siddhartha Public School, which is managed by the Siddhartha
Academy, Vijayawada, India.

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Sri. V. Ramakrishna School was founded by V. Ramakrishna ICS, founder of the

KCP Group in June 1967 at Tiruvottiyur, Chennai. His vision was to provide
education to bright children of lower income groups through this equal opportunity
school. The institution was started as a Primary School with Telugu as the medium
of institution, with the motto “ThamasomaJothirgamaya”, (Lead us from the
Darkness of Ignorance unto the Light of Knowledge). With continued efforts from
the management and staff, the school upgraded to Middle School in September
1982 and High School in June 1991.
The English medium section was also started around this time. In June 2002, the
school started offering Higher Secondary education. The main advantage of this
school is that a child can learn three languages (Telugu, Tamil and Hindi), and can
opt for Telugu or English medium education at the same campus.
Future Plans:-
The school plans to launch an ‘Open School’ under the National Open
School concept for school dropouts and others unable to receive regular education.
The school plans to start a full-fledged computer training laboratory with Internet
access.
Health Care:-
Some of the institutions that the KCP Group has made major contributions
towards include:
 KCP Nephro-urological Center & Research Foundation, Vijayawada.

 Share Hospitals, Hyderabad.

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Never Compromise on Quality

KCP’s growth was not constrained to India. In 1990, the company took on
the challenge of setting up and developing a sugar industry in Vietnam. Impressed
by its performance, expertise and experience in growing the cane and setting up
factories under challenging circumstances, the Government of Vietnam invited KCP
to set up a sugar factory in Son Hua district of Phuyen province in Vietnam.
The entire plant and machinery was designed by Fives Cail-KCP Ltd.
Commercial production successfully started from January 2002 to manufacture
export quality refined sugar and white sugar. The management systems are certified
to the Quality management System Standards ISO 9001. KCP Vietnam Industries
won a gold medal in the year 2003 producing 2500 TCP of refined sugar.
KCP-Vietnam is truly a landmark in the history of the company. With this
venture, KCP is one of the few Indian groups to go truly multinational. With the
right technical expertise and project management skills, KCP is now known for its
capacity to set up plants in any location, irrespective of setbacks or contingencies.
KCP Vietnam Industries stands testimony to that fact.
WELFARE PROVISIONS AT K.C.P. CEMENTS LTD.

MACHERLA
The principal objective to this chapter is to outline the various welfare
measures stationary as well as non-statutory provided by the management of K.C.P.
Ltd., to it employees. K.C.P. Ltd., a committed organization to the welfare of its
employees, has been providing a wide range of facilities, which have made the
employees satisfied and loyal to the organization. The various measures are
described under the needs.
(A) STATUTORY
(B) NON-STATUTORY
(A) Statutory Welfare Measures :-

The various facilities provided as per legislations like factories act, 1964, payment
of bonus act 1965, Motor Transport workers act 1961, employees provident fund act
1952, Mines act and payment of gratuity 1972, are given in the subsequent.

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Medical Facilities:-
The K.C.P. Ltd., Cement Factory, Macherla having a dispensary where in all
permanent employees other than management staff and dependents of them are
treated and medicines are supplied free of cost, for the first aid treatment.
Medical Benefits to those not covered under E.S.I. scheme. Half month salary will
be paid per year towards total medical expenses. In case of accidents
reimburseingBasic+D.A+V.D.A for the periods of actual temporary disablement. In
case of permanent disablement compensation is being paid as per provisions of
Workmen’s Compensation Act, 1921.
The dispensary functions of a its hours basis. The total expenditure of the
dispensary is Rs. 20,000 per year. Expenditure for medicines and other items of the
dispensary during the last two years is given in table. The dispensary is given only
the first aid treatment.
EXPENDITURE OF DISPENSARY
Year Expenditure
2011 – 2012 Rs. 25,000
2012 – 2013 Rs. 20,000
2013–2014 Rs.30,000
Medical Assistance for Officers:
As per the K.C.P. Ltd., management staff medical assistance scheme,

which came in forces from 20-11-1975. The details of the assistance
provided is given in table.
Grade Reimbursement yearly
I 5,000
II 8,000
I II 10,000
IV 15,000
V 20,000

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(2) PREVENTIVE STEPS WITH REGARD TO OCCUPATIONAL

DISEASES:-
Occupational diseases which will develop are likely to develop in a worker

due to his continuous employment in a particular occupation, due to the positions
effect of the dusts and fumes that may arise during the process of work of the
employees in that particular occupation.
Precautionary steps are essential not only from the view of the workers
health but also from the view of the employer, because of the fact that if the
employer is deprived of the service of an experienced employer, because he has
gone for treatment of the disease. The employers production is going to be effected.
This will deprive the employer of his profits, and finally to the society a substantial
amount of goods and services.
Section 12, 14, 56, 36A of the factories Act, 1948 contains the provision to be
adopted for the treatment and disposal of the dust and fumes that are likely to arise
during the manufacturing process. These dusts and fumes are likely to affect the
health of the workers.
The K.C.P. Limited, Macherla also has another method every year medical
examination of the Mines Employees and canteen workers.
The medical checkup of the employees is in following aspects:
1. X – Ray of chest.
2. Screening.
3. Blood.
4. Blood test (Special)
5. Blood sugar.
6. E.S.R.
If symptoms of any diseases are traced the employees will be admitted into
hospitals and treated.

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(3) PERSONNEL INJURIES ACT :-
The personal injuries Act, 1964 placed the liability to pay compensation on the
Central Government of goes gainfully employed persons for personal injuries
sustained due to many action.
The Government framed personal injuries (CI) scheme. The employees are liable to
pay compensation to workmen sustaining personal injuries arising out of every
action and are required to take out insurance policies from the Government to cover
their liability and to pay premier at quarterly interests.
The K.C.P. Limited personal injuries offices covering schemes is in operation.

Medical Staff list is given below:
Name No. of Qualification

Persons.
DOCTOR 1 M.B.B.S., M.S.

MEDICAL ATTENDANT 1 Certificate Course
DRESSERS 2 Certificate Course
Such of them who are not covered by the E.S.I. are covered under personal accident
insurance scheme and they will get compensation and Medical expenses as per
personal accident policy. 5 years salary or the compensation under workmen
compensation Act will be the capital amount for Insurance in each case.
(4) CANTEEN:-
Section 46 of the factories Act 1948, given powers to the state government to make
rules requiring that in any specified factory where in more than 250 workers are
ordinarily employed a canteen or canteens shell be provided and maintained by the
occupier for the age of the workers. It also empowers the state government to make
rules regarding the establishment of the canteen and the food stuffs to be served
there in etc.

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The K.C.P. Limited, Cement Factory at Macherla has a canteen, the details of which
are as under.
Name of the Canteen : THE R.K.C. CO-OPERATIVE

STORES CANTEEN
TYPE OF MANAGEMENT : Managed by the Co-operative stores

management board. The board of
directors is elected for a period of 6
years.
EX-OFFICE PRESIDENT : GENERAL MANAGER.
SECRETARY (CONVINER) : Dy. General Manager (HR&S)
DIRECTORES : 7 Representing employee’smanagement

Staff 7.
DETAILS OF THE BUILDING : The canteen is run in the separate

building for the Co-operative stores
pukka building with R.K.C. roofing.
NUMBER OF EMPLOYEES : Permanent: 13 Monthly wage basis.
TIMINGS:-
5.30 AM to 12.00 NOON
3.00 PM to 5.00 PM

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SALARIES OF CANTEEN EMPLOYEES:-
CATEGORY WAGES
Cook : 7,350/-
Suppliers : 7,200/-
Cooking helper : 7,254/-
Canteen Clerk : 8,000/-
SERVICE:-
Mainly self servicereals served at the table. As the Canteen is open to the public like
lorry drivers, causal workers etc., they are provided with table service for which
there are two separate section that is self service and table service.
Refreshments are supplied in the canteen are given below:
FOOD ITEMS REVISED RATES
Idly (2) 1 Rupee
Attu (1) 1 Rupee
Chapatti (1) 1 Rupee
Upma 1 Rupee
Gare (2) 1 Rupee
Pakodi 1 Rupee
Sweet 1 Rupee
Coffee 1 Rupee
Tea 1 Rupee
Meals (1) 10/- Rupees.
The company has provide 3 Books for all employees 50 /- per month.

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The expenditure and accounts of the canteen are maintained with that of the Co-
operative stores.
Credit facility is provided to the workers and recoveries are made from the salaries.
A subsidy of Rs. 20,00,000 per year is given by the Factory. A part of the furniture
is souled by the company. The electricity bills are paid by the company. Free
transport is provided by the company.
(5) DRINKING WATER :-
Drinking water is one of the most essential requirements of human life.
Section 18 (1) of Factories Act 1948, States that effective arrangements should be
made for the supply of whole some drinking water in every factory.
Sub Section (2) state that all the paints should be marked drinking water in a
language under food by majority of the workers and such points should not be
situated within 20 feet of latrine, urinal or any washing place unless a shorter
distance is approved in writing by the Chief Inspector.
Sub Section (3) states that wherein 250 workers are ordinarily employed,
provision shall be made for cooling drinking water during hot weather by effective
means and for distribution thereof.
In the K.C.P. Limited, water in cooled by water collars and supplied to the workers
and other employees as the time, the study was conducted was hot.

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(6) BONUS:-
The payment of Bonus Act, 1966 provided for the payment of Bonus to the
employees on the basis of profits or on the basis of production of productivity.
In the K.C.P. Ltd., fixation of percentage of Bonus and it calculation is done

at the head office, since 4 years K.C.P. Ltd., is paying 20% to its employees,
However this percentage of Bonus they are taking into consideration the basic pay
plus dearness allowances, plus variable dearness allowance and special allowance.
Except trainees rest all the employees are paid Bonus.
(7) WASHING ALLOWANCE:-
Section 10 (2) of the Motor transport workers Act, 1961 payment of washing
allowance to the drivers and Motor workers. To all employees who are provided
with uniform Rs. 35 /- per month.
YEARS AMOUNT
2007 – 2008 Rs. 29,40,151

2009 – 2010 Rs. 30,87,261
2010– 2011 Rs. 32,87,807
2012- 2013 Rs. 33,73,890
(8) PRODUCTION BONUS :-
Section 31A of the payment of Bonus Act, 1965 provided for the payment of
Bonus based on production or productivity in lien of Bonus based on profits where
on agreement of this effect is entered by the employees with their employer.
In the K.C.P. Ltd., as there is no agreement for the payment of Bonus on the
basis on production the bonus based on production is not paid.

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(9)PROVIDENT FUND:-
The Government of India passed the employees provident fund and

miscellaneous provision act, 1952 and established employees provident fund
scheme under the provisions of section 5 of that act contributions should be paid by
both employer and employees as per the provisions of section 6.
Under the provisions of section 17(1), the appropriate Government can

exempt any establishment from the operation of provisions of the employees
provident fund and miscellaneous provisions act, 1952. if in it opinion there is
existing any other provident fund whose contributions are not less then those
provided in section 6 of the act, and the employees are enjoying benefits which on
the whole are not less favorable then those provided under this act.
The K.C.P. Ltd., Ramakrishna Cements, Macherla has an exempted

provident fund schemes. Provident Fund is being contributed at the rate of 12% of
the total wages of the employee. The members of the fund are granted both
refundable and nonrefundable loans by the board of trustees for the purposes
provided in the rules.
(10) FAMILY PENSION SCHEME:-
Pension means regular payment by the state of b a farmer employer to some body
on completion of a term of service or on retirement, disablement etc.
Section 6 has been inserted in 1971 to the employees provident fund and
miscellaneous provisions act, 1952 under whose provisions employees family
pensions scheme was framed.
Sub section 1 (a) of section 17 of the employees provident fund and miscellaneous
provisions act, 1952 authorises the Central Government to exempt any
establishment from the provisions of the family pension scheme if in its pension the
employees of that establishment are enjoying benefits on the whole are not less
favourable than those provided under this scheme.
In the K.C.P. Ltd., Family pension scheme was introduced on 1-1-1971 and
contributions are made as provided for in the Scheme.

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(11) PENSION:-
The K.C.P. Ltd., employees (other than officers) super anuation scheme was
introduced on 1-1-1978. the amounts paid by the company towards pension scheme
500 /- per month.
A Pension scheme was formulated by the management for workmen covered under
wage board.
a) A member should have attained the normal retirement period applicable to him
and completed a minimum of 10 years of service.
Or
b) A member should completed the age of 58 years and 10 years of service and up
to retire before attaining the normal retirement age applicable to him.
Or
c) A member should complete the age of 50 years and 10 years of service, and has
been permitted by the company to retire prematurely before attaining the
normally retirement age applicable to him on grounds of health, subject to such
medical examinations as may be prescribed by the company.
Or
d) A member should have completed the age of 50 years and 10 years of service
and there after he has been retired from his services and terminated by the
company on grounds other than importance, misconduct, fraud, criminal,
condition or any other effecncedariting dismissal.
Or
e) Disabled in the course of employment in the service of the company due to
accident or diseasing become unfit further employment in the company, subject
to such medical examination as may be prescribed by the company.
The upward revision of the pension scheme is under the active consideration
of the management.

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(12) GRATUTIY:-
Gratuity means gift of money to an employee etc., for service rendered. Now a days
its claimed as a right of the employee under the provisions to the payment of
Gratuity Act, 1972.
Gratuity is another form of social assurance for the employee and his family
members in the old age of the payment employee.
e Government of India enacted the payment of Gratuity Act, 1972 to put an
obligation on the employer to pay Gratuity to his employee on certain conditions i.e.
he should put in a minimum of 5 years of service and Gratuity is payable to him.
a. On his Superannuating.
b. On his Retirement or Resignation or
c. On his Death or Disablement due to accident or diseases.
The completion of 5 years of service is not necessary where the termination of

employment is due to death or disablement.
The K.C.P. Ltd., has its own Gratuity rules and regulations for the purpose every
employee should put in minimum 5 years of service. He will be paid 12 monthly
last drawn pay of his total service per every year of completed service. If the
employee dies during his service period he will be paid Gratuity taking in to
consideration his total service from the date of appointment till his death.
(13) SHELTER, REST-ROOMS AND LUNCH ROOMS:-

The Factories Act, 1948 lays down that in every factory where in more than 150
workers are ordinarily employed, adequate and suitable shelter rooms and a suitable
lunch rooms, with provision for drinking water where workers can takes meals
brought by them, shall be provided and maintained for the needs brought by them,
shall be provided and maintained for the use of the workers.
In the Ramakrishna Cements, three is one big shed for taking rest. In this rest room
pillows and mats are also provided to the workers by the management. There is also
a lunch room with chairs and tables and a water cooler.

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(14) OTHERS:-
a) EMPLOYEE’S DEPOSIT LINKED INSURANCE SCHEME:-
This is another farm of social insurance to the employees in his old age and to his
family members in case of his death.
The Government of India under the provisions of section 5 © of the Employee’s

provident fund and Miscellaneous provisions act, 1952 farmed this scheme.
Section 60 (2) states that the employer shall pay from time to time in respect of the
every employee in relation to whom he is the employer such amount not being more
than are percent of the agreement of the basic wages dearness allowances and
retaining allowance (if any) for the time being payable inrelation to such employees
as the central government may be notification in the official gazatte specify. This
scheme came into force 1.8.1976 in the K.C.P. Ltd.
(1) SAFETY COMPETITIONS:-
Safety Competitions are held once in a year and prizes are warded for the winners in
safety posters. Safety slogans and safety suggestion as national safety day cash
awards are also given to these employees who exhibited bravery and or preventing
accidents by timely action. On the eve of Mines safety week celebrations held on
20th December, 1992 our P.P. Mines was awarded the following prizes among all
mines.
1. Overall Performance 1st prize

2. House-keeping 1st prize
3. Safe Drilling and blasting 1st prize
4. Electrical Maintenance 1st prize
5. Publicity and propaganda 1st prize
6. Opencast working 2nd prize
7. Operation and Maintenance of machinery 2nd prize

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(b) NON-STATUTORY WELFARE MEASURES:-
The various Non-Statutory welfare activities which the management of the

K.C.P. Ltd., following paras.
1. HOUSING:-
The K.C.P. Ltd., cement factory at macherla has housing colony for some of
their employees by name. The K.C.P. Ltd., R.K.C. Colony is devided in to three
types. They are officers, staff and workers colony.
The total numbers of houses in the colony are 253.
The General Manager decides the allotment. The allotment of quarters as

made depending on the importance of the job and the experience of the employee
preferences is given to out siders then local people.
The following categories are allotted these quarters:
a) Senior and highly Technical

b) Lower Technical
c) Staff Grades
d) Management staff
The company is having ‘O’ and is type quarters for their officers. The
number of quarters are 33. all most all the officers of the company are provided with
quarters. The company has provided free quarter facility. They are not paid any
amount.
From the employees house rent is being collected as per the recomondation
of the wage board cement industry at Rs. 6 for month for those who were allotted
house before 1-1-69 for others rent is being charged at the following rates.

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H.R.A. (House Rent Allowance)
The company has charged the following rates for the employees;
Category Amount Condition

If any
Management staff-officers 40%Basic salary
Non-Management staff
Staff Staff &Workers
1 475 A 460
2 475 B 460
3 475 C 425
4 505 D 425
5 505 E 425
Fans and Tube Lights:-
 “O” Type Quarters are provided with 4 fans and 4 tubes.

 “S” Type quarters are provided with 2 fans and 2 tubes.
 The resident of K.C.P. Ltd., R.K.C. Colony are allowed 30 units or power
each free of cast us per the recommendation of the cement wage board over
and above 30 units of consumptions each unit of power is charged 3.50
rupees.
 Electricity for other type of quarter of follows:
 ‘O’ type units of power200 units per month as allowed free of cost. Above
units of consumption each unit is charged at 3.50/- rupee.
 “S” type 50 units of power per month as allowed free of cost. Above units of
consumption each units is charged at 3.50 rupee.
 The repair to the houses and maintenance are being carried out by the
management. The quarters are being locked after by the civil works
department.
 Separate sheds are provided for the workers. Supply of water is free of cost.

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1) EDUCATION:-
The K.C.P. Ltd., Macherla provides free education to the workers children in the
company school. Sri Ramakrishna Memorial High school was constructed by the
company is about one acre of land, other furnitures is provided by the company. The
school is run by the contributions from Industrial workers welfare fund, the aid of
the Government and aid of the company. Free education is provided from 1st to V
class. The medium of instruction is Telugu.
Ramakrishna Memorial scholarship;
The Ramakrishna Memorial Scholarships is granted by the Ramakrishna Cement

sponsors various schemes to improve the education of workers children. Those
schemes are Rs. 300 and Rs. 500 paid to the workmen whose children are study VII
and X classes for purchase of books.
Scholarships on merit Basis:
A. Inter and Degree Courses Rs. 500/-

B. Post-Graduate Courses Rs. 4000/-
C. Professional Courses Rs. 4000/-
The Ramakrishna Cements gives interest free loan of Rs. 3000 to the employees
whose children or dependents are studying post-graduation or professional courses.
The Ramakrishna Cements gives interest free loans of RS. 7000 to the employees
whose children are studying diploma courses. The Ramakrishna Cements has
introduced subsidy scholarships worth of Rs. 3000 from 1996-1997.
2) TRANSPORT:-
Most of the workers of the K.C.P. Ltd., Macherla are residing near by the factory
and also near by the village. The company is not providing any transport facilities.
The company has provided colony facility.

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3) INSURANCE SCHEME AVAILABLE:-
a) Employees Deposit Linked Insurance Scheme:
Employee Deposit linked insurance scheme was introduced from 1.8.1976 and
contributions are made at statutory rates prescribed in the schemes. The total
number of subscribers in the scheme is 1290
b) Life Insurance Corporation:
Life Insurance Corporation salary saving scheme is in operation.
c) Personal Injuries Act:
Personal Injuries Act compensation insurance offices covering scheme is in

operation.
4) CO-OPERATIVE STORES:-
The K.C.P. Ltd., Cement Factory at Macherla has a co-operative stores by name ‘
R.K.C. Co-Operative stores Ltd’.
The K C P Limited Cement Factory has been maintaining Co-operative stores use
and welfare their employees. Its name was Rama Krishna Limited Co-operative
Stores. It was registered by Co-operative society Act. It having president, Secretary
and board of Directors. Elections conducted by Co-operative department six
members of board directors elected among them one is secretary, remaining 5
persons are director’s president elected by board of directors now the KCP G.M. is a
president of the Co-operative stores. The K C P Cement Dy.G.M. (HR&S) is a
Secretary.
The commodities dealt by the stores are all provisions handloom cloth, mill cloth,
Fancy articles, pice, coffee, sugar, kirosen, oils etc.
The K.C.P. Ltd., has given free building, furniture electricity and advances for
purchases without interest. The co-operative stores provides credit facility to the
workers. The co-operative stores is maintained with the share holders capital.

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Admission or membership fee to enrole himself as a share holder of this co-

operative society is Rs. 5 /- per member + Rs. 50 p.s per share. A trade deposit is
received from each member depending upon his consumption.
Every member can obtain goods and the necessary articles from the stores as
required by him during the month. The amount due from the member on each such
credit purchase is maintained in the books of account with the stores. On 20th of
every month, a list showing the dues from each member to the stores is sent by the
stores to the establishment department, where the salary payable etc., to the
employees are computerized. The dues to the co-operative stores are deducted from
out of the salary payable to each employee. The deducted amount is adjusted to the
credit of the member’s account with the co-operative stores.
This co-operative stores has a membership of 320 and the turnover during the last
year was Rs. 36,00,000, T.V’S, Cycles, Domestic appliances are also available in
the co-operative stores. Repayable in installments.
5) RECREATIONAL AND CULTURAL ATIVITIES:-

An auditorium with stge and other facilities was constructed by the company for
staying draws and other cultural activities. Ramakrishna Recreation Club for men
and Ramakrishna MahilaSevaMandali provide recreation to the members of the
employees families. Cultural activities are held throughout the year an important
festivals and occasions like Ramakrishna jayanthi is being celebrated every year on
the March.
Independence Day will be celebrated every year. On this occasion

competitions are being held among the employees in different sports and games like
kabbadi, volley ball etc. competition will also be held among the members of the
employee’s families, prizes will be awarded to the participants.
The prize consists of Steel Bolus. The company has purchase yearly 2000 /- sports
equipment. Macherla teams were winners in “kabadi and Tennikoit Singles and
doubles at the Andhra Pradesh Labour fund sports meet, Guntur zone. They will
now participate in the final state level sports meet.
The company has facilitate star T.V. and Cable T.V facility. They has facility for
the colony employees.

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6) LEAVE AND LEAVE TRAVEL BENEFITS ETC:-
The leave and other benefits given of the K.C.P. Ltd., employees and other staff are
given in the table.
LEAVE DETAILS
Category of Casual Sick El / Pl Earned

Employment Leave Leave Leave
Workers 7 12 15
Clerical Staff 7 12 15
Officers 6 -- 24
Company Trainees 7 12 --
Encashment of Leave:
As per staff regulations the officers are allowed to accure their leave up to a
maximum of 30 days.
Leave Travel allowance for Officers:
As per the leave Travel Allowance for the Officers scheme which came in to force
on 1.7. 1973 and the amendment brought at causes 23 of the staff regulations which
came into force on 01.04.07 leave travel allowance are given in table.
Grade Amount Rs.

1 5,000
2 8,000
3 10,000
4 15,000
5 20,000
7) UNIFORMS:
At the workers are to work in the Factories and Mines where dusting in common,
Uniforms are better suited for working. They will also create a feeling of belongness
in the employees. In the K.C.P. Ltd., Macherla Cement Factory Management has
provided with Uniforms and shoes.

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Category Colour Quantity &

Quality
OFFICERS Shirt : Light blue

Phants : Black 3 pairs Terry
cotton
STAFF Shirt : Light blue

Phants : Black colour “
WORKERS Shirt : Blue colour
Phants : Blue colour 2 pairs & Cotton
SHOES:
Category Colour
OFFICERS Brown
STAFF Brown
WORKERS Black
8) FESTIVAL ADVANCE:
Rs. 2000 /- in lumpsum is paid as Festival Advance to “Hindus” for Dessara to

“Muslims” for Ranjan to Christians for X-mas. This amount is sanctioned for all
perment employees in 5 equal monthly instalments.
9) CONVEYANCE ALLOWANCE:
Rs. 450 /- in lump sum is paid as conveyance allowance to all permanent employees
covered by wage board.
10) BANK RECURING DEPOSIT:

Bank Recurring Deposit Scheme is in operation.
11) INDUSTRIAL WORKERS WELFARE FUNDS:
Rs. 5 per year will be collected from every employee of the factory.

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The management gave donation of Rs per year for years and Rs for years and from
them awards an amount of per year was being given as donation for the Industrial
workers welfare fund.
SERVICE RECOGNITION:
The entire permanent employee who has completed 20 years of service and at the
time of retirement will be presented by the company with a TITAN wrist watch
each.
OTHER ALLOWANCES;
In Ramakrishna Cement workers are getting allowances as per arbitration

award 1982.
Heat Allowance: 2.5% of basic for greasers and heat exchange operators and 5%
to Burners and cooler attendants per month as per award.
Driving Allowance: For car drivers Rs. 25 /- per month and for heavy vehicle
drivers Rs. 15 /- per month.
Night Shift Allowance: Rs. 1 /- per shift for those who are doing work after 12-
00 midnight.
Dust Allowance: For all workers including contract labouraffected by dust, jaggy
and coconut oil (0.5% kg and1.5% kg) is given as per award.

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CHAPTER-3
THEORETICAL FRAME WORK

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INTRODUCTION
Nature &study of supply chain management, a conversation that has indeed
been on
going for a number of years (see Croom & Saunders, 1995). Our concern was with
the nature of research in supply chain management, and more specifically with
exactly what would constitute the domain of supply chain management as a
management discipline. From these discussions this paper developed in order to
present a basis for our debate and development around the field of supply chain
management by attempting to consolidate current learning, identify possible gaps,
and thereby pose possible future directions for development. Our contention that
supply chain management should begin to be seen as a discipline in much the same
way as marketing (Malhotra, 1999) has been seen as contentious, not least by early
reviewers of the paper, yet we stand by this claim, citing Long & Dowells (1989)
argument that "…disciplines are distinguished by the general (discipline) problem
they address." (Cited in Tranfield and Starkey 1998). What we set out to establish in
this paper is in fact hte general problem domain of supply chain management,
thereby, we hope, contributing to the development of a discipline in supply chain
management.
Tranfield and Starkey also note the underlying soft, applied, divergent and
'rural' nature of management research, and further argue that there is a real need in
any field of social research to identify the cognitive components of the subject
(Tranfield & Starkey, 1998). Their paper has been instrumental in our approach to
the challenge of undertaking a critical literature review of the field of supply chain
management, and this paper's focus on mapping and classifying the area has been
motivated by their claim that "…a key question for any applied filed concerns the
strategic approach taken to its mapping" Supply chain management and other
similar terms, such as network sourcing, supply pipeline management, value chain
management, and value stream management have become subjects of increasing
interest in recent years, to academics, consultants and business management
(Christopher, 1992; Hines, 1994; Lamming, 1996; Saunders, 1995, 1998). It is
recognized in some parts of the literature that the supply chain should be seen as the
central unit of competitive analysis (Macbeth & Ferguson, 1994; Cox, 1997).
Companies will not seek to achieve cost reductions or profit improvement at the

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expense of their supply chain partners, but rather seek to make the supply chain as a
whole more competitive. In short, the contention in that it is supply chains, and not
single firms, that compete is a central tenet in the field of supply chain management.
(Christopher, 1992; Macbeth & Ferguson, 1994)
Supply chain management has received attention since the early 1980s, yet
conceptually the management of supply chains is not particularly well-understood,
and many authors have highlighted the necessity of clear definitional constructs and
conceptual frameworks on supply chain management (Saunders, 1995, 1998; New,
1995; Cooper, Lambert & Pagh, 1997; Babbar & Prasad, 1998)
Saunders (1995) warns that pursuit of a universal definition may 'lead to
unnecessary frustration and conflict', and also highlights the fragmented nature of
the field of supply chain management, drawing as it does on various antecedents
including industrial economics, systems dynamics, marketing, purchasing and inter-
organizational behavior. The scientific development of a coherent supply chain
management discipline requires that advancements be made in the development of
theoretical models to inform our understanding of supply chain phenomena. As an
illustration, the application of Forrester's (1961) industrial dynamics model applied
to supply chains (the 'Forrester Effect') exemplifies such a model. Its value lies in
the ability to aid understanding of the actions of materials flows across a chain, and
has provided a basis for further advancement of understanding supply chain
dynamics. (E.g. see Sterman, 1989; Towill, 1992; Van Ackere, Larsen & Morecroft,
1993 and Lee, Padmanabhan & Whang, 1997). Cooper et al. (1997) support this
view, pointing to the fact that whilst supply chain management as a concept is a
recent development, much of the literature is predicated on the adoption and
extension of older, established theoretical concepts.
Our concern is not so much with advancing theory per se, but in providing a
taxonomy with which to map and evaluate supply chain research. In the process, it
is our contention that we also provide a topology of the field of supply chain
management, which may provide a fruitful means of delineating or defining the
subject domain. This is not necessarily a novel idea, Lamming (1993), for example,
provides a map of antecedent literature for his development of the Lean Supply
Model, which again supports our claim that there is a need for a topological
approach to the development of supply chain theory.

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The main purposes of the survey are:

• to look at some major issues in supply chain management literature and to present
a framework for classification and analysis
• to describe and evaluate the methodologies used in supply chain management
literature
The paper is organized in five sections. In section one some definitions of supply
chain management are examined, underlining differences and common aspects, in
order to better trace the boundaries of the concept the paper is on and to highlight the
difficulties of its definition. One of the reasons for the lack of a universal definition of
supply chain management is the multidisciplinary origin and evolution of the concept.
Section two considers the bodies of literature associated with supply chain
management and discusses the different perspectives adopted by various authors. In
section three we explain the framework and the methodology used for classifying the
literature analyzed and we present the results of literature review. Section four
presents a summary and some conclusions we can draw from the work in terms of
moving towards a disciplinary approach to supply chain management. Section five
contains an extensive reference list.
The Supply Chain Management Landscape
In providing a topology of the supply chain landscape we support New (1995)
and Saunders (1995) contention that within the supply chain management literature
there is a confusing profusion of overlapping terminology and meanings. As a
consequence, in the literature many labels can be found referring to supply chain and
to practices for supply chain management, including: integrated purchasing
strategy (Burt, 1984), supplier integration (Dyer, Cho & Chu, 1998), buyer-supplier
partnership (Lamming, 1993), supply base management, strategic supplier alliances
(Lewis, 1995), supply chain synchronization (Tan et al., 1998), network supply
chain (Nassimbeni, 1998), value added chain (Lee and Billington, 1992), lean chain
approach (New and Ramsay, 1995), supply pipeline management (Farmer & van
Amstel, 1990).), supply network (Nishiguchi, 1994), value stream (Jones, 1995).
This table is not intended to provide a comprehensive review of supply chain
definitions (see for example Cooper, Lambert and Pagh 1997), rather the purpose
here is to highlight some of the contrasting approaches to supply chain
management existing in the literature.

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AUTHORS DEFINITION
Tan et al. Supply chain management encompasses materials/supply
management from the supply of basic raw materials to final product
(and possible recycling and re-use). Supply chain management
focuses on how firms utilize their suppliers’ processes, technology
and capability to enhance competitive advantage. It is management
philosophy that extends traditional intra-enterprise activities by
bringing trading partners together with common goal of optimization
and efficiency.
Berry et al. Supply chain management aims at building trust, exchanging
(1994) information on market needs, developing new products, and reducing
the supplier base to a particular OEM (original equipment
manufacturer) so as to release management resources for developing
meaningful, long term relationship.
Riley Jones An integrative approach to dealing with the planning and control of
and the materials flow from suppliers to end-users. External Chain is the
(1985) total chain of exchange from original source of raw material, through
Saunders the various firms involved in extracting and processing raw
(1995) materials, manufacturing, assembling, distributing and retailing to
Ellram(1991) ultimate end customers .A network of firms interacting to deliver
product or service to the end customer, linking flows from raw
material supply to final delivery.
Lee and Network of organizations that are involved, through upstream and
Christopher downstream linkages, in the different processes and activities that
(1992) produce value in the form of products and services in the hands of
the ultimate consumer.
Billington Networks of manufacturing and distribution sites that procure raw
(1992) materials, transform them into intermediate and finished products,
and distribute the finished products to customers.

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Sales and Distribution
Manufacturer Customer
Manufacturer Retailer Customer
Manufacturer Wholesaler Retailer Customer
Manufacturer Wholesaler Jobber Retailer Customer
Here jobbers are special type of wholesalers who are usually found in stock
markets.
Different Distribution Channel
Distribution Channel
Conventional Hybrid Horizontal Vertical
Mkt System Mkt System Mkt System Mkt System

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Conventional Marketing System:
A channel consisting of one or more independent producers, wholesalers, &

retailers each a separate business seeking to maximize its own profits even at the
expense of others in the system.
Horizontal Marketing System:
A channel arrangement in which two or more CO’s at one level join to gather
to follow a new marketing opportunities. Hybrid Marketing System:
It is a multi channel distribution system in which a single firm sets up two or

more marketing channels to reach one or more customer segments.
Vertical Marketing System:
A channel structure in which producer, wholesaler, & retailer act as a unified

system. One channel member owns the other, has contact and power to cooperate with
them.
Manufacturer Retailer Wholesaler
Customer

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Vertical Marketing System
Corporate V M S Contractual V M S
Administered V M S
Corporate V M S:Successive stage of producer & distributor under single

ownership.
Administered V M S:A coordinated successful stage of production &

distribution, not through common ownership or contractual ties but through the size
and power of one of the parties.
Contractual V M S:
A Marketing system in which independent firms at different levels of

production & distribution joint together through contracts to obtain more.

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Contractual Vertical Marketing System
Wholesaler Franchise Orgs

Sponsored
Retailer Cooperatives
Wholesaler-Sponsored:
A Wholesaler organized voluntary chain of independent retailers to help then

compete with large firms.
Retailer Cooperatives: Retailers organize a new joint owned business to carry on
wholesaling and possibly production.
Franchise Organization:-Linking several stages in the production distribution process.

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Franchise Organizations
Mfr Sponsored Service Firm
Retailer F S Mfr Sponsored Sponsored F S

Wholesaler F S
“Franchising” is usually taken as licensing of an entire business

format. A franchise is a package of industrial or intellectual property rights which
relates to trade names , trade-marks , shop signs, utility models, designs, copyrights,
know-how or patents.
Manufacturers Sponsored Wholesalers Franchise:
In this method the manufacturers arrange distribution with some individual outlets
providing the required machinery for selling. Here the owners of outlets lack capital
and knowledge of marketing the products.
Manufacturers Sponsored Retailers Franchise:
In this parent company provides loans, designs for buildings, training for both owner
and staff and helps in advertising and promoting the business, but individual retailers
should look after the selling operations by their own.Service Firm Sponsored
Franchise:
Franchisor which will often be responsible for Recruiting and providing ongoing
support to operating franchisees.These are expected to attract, select, train and provide
ongoing support to owner-operating franchisees

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Identifying Channel Alternatives:
A company after defining its target and desired positioning should identify its channel
alternatives. A channel alternative is described by three elements- type of available
business intermediaries, number of intermediaries needed and terms and
responsibilities of channel members. The following are the alternative channels
availed to Manufacturer Company—
 Company sales force: expand company direct and assign sales representatives
to territories to contact all prospects on area or develop sales force for different
industries.
 Manufacturer’s agency: hire manufacturers’ agents in different regions or end-

use industries to sell new equipment.
Industrial distributors: find distributors in different regions or end-use industries who
will buy and carry the device. Give them exclusive distribution, adequate
margins,product training, and promotional support.
The following are the alternative channels available to consumer goods company-
OEM market: The Company could sell its product original equipment manufacturers
(OEM).Direct market: The Company could sell its products to dealers.
Retail dealers: company could sell its terms to retail equipment
dealers through direct sales force or through distributor.
 Product special dealers: company could sell its products specialist dealers
through direct sales or dealers.
 Mail-order market: company could sell its products through mail-order
catalogues.
Apart from the traditional act of buying and selling most of the retail task is driven
by the supply chain. For profitability, a retailer has to look far beyond these pure
transaction functions. Although some argue that supply chain implementation is
complex, the numerous financial gains that have been observed by the companies
making a full potential of supply chain management cannot be downplayed. Most big
retailers already pay most attention to the management of their supplies. These
include alignment, synchronization, and relationship building. Not all SME’s have

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paid attention to supply chain management for various reasons. For some of them, it
does not add significant value to their operations and some they are just unaware of it.
For this reason, it is important to revisit the definition of supply chain management
and show that retailing, no matter what the company size is, is inevitable in supply
chain management. Arend and Wisner (2003, 403), define supply chain as the
integration of key business processes with trading partners for an added value to
customers. By this, they mean creating a close knit between the partners upstream
through downstream of the value chain for efficiency. This is done by sharing
information with the suppliers, jointly designing the supply chain for optimization
using tested tools and information technology. It can also be termed an end-to-end
process for information to pass through all partners for action
According to the Institute of supply management, Supply chain management
is the process of managing fourteen functional areas to increase value for customers
and for business viability. These functions include sourcing, purchasing, inventory
control, material management, quality management, logistics, transportation, disposal
(recycling), warehousing (storage), distribution, receiving, packaging, product/service
development, and manufacturing supervision. Edward (2011.
Companies that critically asses these operations and use best practices to fulfill
their activities will reap significant cost savings. The baseline for the operations is the
utilization of lean principles in their operation. Lean is the term that originates from
the Japanese auto giant Toyota to revolutionize the car manufacturing industry. It
simply is the elimination of any kind of wastes in the supply chain process. Whatever
does not add value from the customer perspective should be rejected. Interestingly,
each successive hierarchy in a supply chain is a customer to the preceding hierarchy
(supplier). This gave birth to the idea of continuous improvement, which is the
philosophy stating that no particular business operation is perfect. The business must
be re-visited and loopholes should be eliminated as long as it gives no value. As seen
above, logistics is described to be part of the supply chain activities listed by the
Institute of Supply Management. But many other definitions of Logistics actually
subsume the definition than viewed by the ISM. For further clarifications, Logistics
will be explained further in context as a sub chapter which will then be followed by
the ISM activities of supply chain

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Retail and Logistics

Webster’s dictionary defines Logistics as ‘the procurement, maintenance,
distribution and replacement of personnel and materials’. This definition isn’t
particularly right for today’s logistics industry because of the changes function that
has occurred in over the years. A more justifiable definition for Logistics management
is provided by the Council of Supply Chain Management Professionals (CSCMP).
They define logistics as ‘the part of supply chain management that plans, implements
and controls the efficient, effective forward and reverse flow of goods, services and
related information between the point of origin and the point of consumption in order
to meet customers’ requirements’.
As it can be seen from the CSCMP definition above, logistics is a part of the
entire supply chain process. Ayers and Odegaard (2006, 7) define supply chain as
‘Product life-cycle processes comprising physical, information, financial and
knowledge flows whose purpose is to satisfy end-user requirement with physical
products and services from multiple and linked suppliers
The distinction between logistics and supply chain is that Logistics links together the
processes in a supply chain. The success of the whole business which is dependent on
the supply chain is thereby hinged on how well the logistics tasks are performed.
Therefore supply chain is all about processes which depend on the design adopted by
each company. According to Ayers and Odegaard (2006, 3) they are shown in Figure
1 below
i.Customers and end-users
ii.Retailers
iii.Distributors
iv.Original Equipment Manufacturers (OEMS)
v.First-tier suppliers
vi.Second-tier suppliers
vii.Service providers

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Hierarchy of Players in the Sales and Distribution

For a retail business to be profitable, its success hugely depends on the efficiency and
effectiveness of its logistics tasks. Logistics has been earlier defined at the beginning
of this chapter. It is noteworthy to understand that warehousing, inventory,
transportation, unitization or packaging and communication as explained below are
parts of logistics.
Sourcing
According to Lister (2010), sourcing is defined as "the processes involved in
identifying potential vendors, conducting negotiations with them and then signing
purchasing agreements with them to provide goods and/or services that meet your
company's procurement needs. This is a self-explanatory function and is needed by
any business operation be it in goods or services. The act of professional sourcing is
now gaining recognition worldwide after been given less attention in the past. This
function can be expanded or contracted depending on the organization in question.
Those in the sourcing business as well as researchers have identified four sourcing
alternatives. Zeng, (2000) classifies sourcing as single sourcing, multiple sourcing,
global sourcing and network sourcing. Giant retailers like Wal-Mart, Tesco, Asda etc.
with millions of product lines are using these classifications as part of their sourcing
strategies
Purchasing
Purchasing is often interchangeably called procurement. The same definition
applies to both only that procurement has a broader task compared to actual
purchasing. The business dictionary defines purchasing as an activity of acquiring
goods or services for achieving the goals of an organization. The task starts from the
specification and ends with the follow up and evaluation. Van Weele (2010).
Purchasing can be tactical or an order function. Retail purchasing is usually geared
towards the order function because it is not usually involved in the manufacturing
process, which makes more use of tactical purchasing. All types of businesses need
purchasing expertise to be able to get the best out of their suppliers
The scope of the purchasing function usually depends on the size of the firm. The
Institute of Supply Management (ISM) argues that when sales are flat and the
inventory is not turning as it should be a 2.5% savings in procurement costs equal the
same amount of profit by increasing sales by 10%. This is one way to look inwards

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Inventory Control
Inventories will remain in organizations operations as long as there is an
imbalance between demand and supply. Keeping inventory has been a safe act in the
past under Ford’s production model and it still is. Investigations and years of research,
especially through the Toyota production model have seen the death of inventory in
most businesses. The main reason is that inventory constitutes a waste, be it in
manufacturing or retail. So inventory control relates to policies and operating
procedures designed to optimize the organization’s use of inventory for maximum
profit without disruption in customer satisfaction levels (accounting tools). No matter
the size of the store, retail inventorying is regarded as a difficult thing in inventory
management. This is because of the total number of product lines available for sale. A
retailer must have expertise in the inventory management to be able to get the best
profit out of the business. The first step to retail inventorying is to separate the
product lines into grocery and non-grocery (Difficult task of retail inventory). The
decision making factors in inventory control are cost of holding stock, cost of placing
an order and cost of shortage With adequate data on these three variables available,
businesses can know to what extent they can hold inventory to avoid markdowns and
losses. Waters suggests retailers should create an Open-To-Buy-Plan. Software for
inventory calculation and forecasting has also made it easier for business owner to
optimize the inventory decisions (Open to buy Planning).
Quality Management
There is the notion in industries that there is no single definition for quality
management. This is a generic term and the conception is different in manufacturing,
retail, transportation, banking, IT etc. But to a retailer, what really make a quality
operation is less waste, more sales and more profit, Gorecki, (1996). These three
philosophies does not seem as easy as they look because they represent the sum of all
the activities needed to be carried out in retail supply chain management from
sourcing to consumption including logistics activities. Rose (2005, 41), classified
quality management in four different components: quality planning, quality control,
quality assurance and quality improvement. These four differentials are the success
factors for ensuring quality. A retailer will need to carefully look out for reliable
suppliers, ensure their products are of quality and find means to improve relationships
with best performing suppliers

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Transportation
Retail transportation has evolved greatly over the years. There has been a
transition from hands-off to hands-on transportation duties. This new power gained by
retailers pioneered by mega-groups like Tesco, Wal-Mart, etc., has seen them take
control of transportation from primary distribution to the secondary distribution. This
means that they employ the services of 3PL companies to discharge these duties. But
the emphasis on leagile (lean + agile) supply chain has resulted reduced inventory and
increased order of small quantities. Retailers now have to monitor every part of their
transportation ever since they took responsibility. There are numerous risks involved
in transportation in general, especially when international logistics is involved.
Congested ports, rising fuel costs, pirates, natural disasters, labour strikes, theft,
underperforming logistics providers, to mention but a few, are some of the issues to
be encountered in international transportation and can cause stock outs. It requires
strategic thinking to come up with a workable plan that will make transportation
improve the whole operation of the retail firm considering all the odds listed above.
Transportation routings, transport economics, transportation software including
forecasting, optimization
Packaging
Having the right package for products is something very dear to retailers. The
big retailers have been strongly involved in collaborative R & D efforts with
manufacturers for packaging efficiency. There are numerous factors that can be
considered in packaging ranging from size, information, design, material etc. The
choice of packaging for products really goes a long way to determine the salability for
that particular product. If the packaging is right, it eases the job of transporters and
also reduces cost in a lot of ways. There has also been increased talk of environmental
concerns, which are becoming more of a factor for consumers on their choice of
environmentally friendly products.

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Warehousing
The business dictionary defines warehousing as the performance of
administrative and physical functions associated with storage of goods and materials.
These include receipt, identification, inspection, verification, putting away, retrieval
for issue, dispatching, inventory management etc. The form or choice of warehousing
for companies has evolved over the years. Considering different factors, companies
may choose to retain their warehousing operation in-house or have it outsourced. This
is a very important aspect of retail as the amount of SKUs in retail management can
be considerable large. There are Warehouse Management Systems in place to make
the administrative function easier for balancing. Most warehouses are fully automated
to ease the burden on wage cost
Pallets placed on racks are used as a standard for the warehousing operation.
Warehousing of cold food chains is also a very important part of this function
especially for the staple retailers. Knowing the size of space needed for the amount of
SKUs the company utilizes is also important, because there is no need for a waste of
space in the warehouse particularly when it is outsourced
Receiving and Inspection

This function is very important to retailers especially those who pay attention
to quality. This is a way to ensure that customers do not receive poor service for their
money. The deliveries are checked for shortages and quality level on arrival. This can
be done by inspecting all individual items or by using some calculated assumptions.
The documents are received signed by the deliverer and recipient. Returns are then
looked out for if any.
Disposal and Recycling
Retailers have been charged with a part responsibility for ensuring that
customers have a clear reverse logistics channel after the life cycle of a product. Most
retailers are working hard to ensure that they contribute their fair share to
environmental concerns. A good example is the bottle return policy exercised in
Finland. Customers gain some amount of money on return of their bottles or cans.
This is some kind of incentive to help motivate consumers in environmental
awareness.

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Communication
The saying that ‘information is moved and not product’ is important in this
case. The communication through the supply chain process particularly helps logistics
perform better. The information includes demand and supply volumes, prices, stocks
levels, product tracking. It is therefore imperative for retailers to get hold of data that
are useful for the upstream supply chain for efficient and effective performance. ERP,
EDIs’, tracking devices, GPS, RFID, management systems, routing systems are all
tools that allow for a smooth operation, but will be very complex with them.
Integration of Logistic Mixes
The success of retail depends on how the five logistics elements, as shown in
figure 2 below, are implemented. This is where the concept of integration comes into
force. The reason for this is that treating each of these elements separately might not
bring transparency into the system. This brings about sub-optimal performance into
the systems operation.
From the figure below, it can be said that the combined challenge for retail is
balancing the weight of cost and service level while utilizing these logistics tasks. It is
believed that if the system focuses more on cost, this might affect the service level
and also on the other way round.
FIGURE 2. The management task in logistics, Ferne & Sparks (2009, 9)

After brief discussions on these supply chain activities, it becomes obvious that
supply chain practitioners have a clear description of their practice jurisdiction.
Although treating each of those explained above as a single entity would not
contribute anything to the target at hand, a more integrative and collaborative effort
amongst each of these channels together with applying strategies and best practices
will ensure a more result oriented approach. There can be significant cost saving
measures in each of these tasks; it now remains to the company in question to keep an
angle eye on those aspects that will reduce these costs. The supply chain integration
will be much easier with the right technology in place

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Retail Supply Chain Transformation

Notwithstanding all the different entities discussed above, there have been
developments in the retail industry that are aimed at balancing service level alongside
costs. These are commonly referred to as retail supply chain transformation. These are
strategies that have sprung up from different economies to challenge the status quo.
One of such concepts includes e.g. consignment stock; as a means to reduce the
liability of the retailer to excess inventory. To this end, researchers in the retail
commerce business have discovered new trends in retailing that are currently being
adopted by the leading companies to counter the effect of competition in their
business. Fernie and Sparks (2009, 10), highlight various transformations going on in
the retail industry. These changes can be attributed to increasing consumer
preferences on the demand for products. Explained briefly below are some of the
issues that have been discussed in the industry
Global Sourcing
Low Cost Country Sourcing (LCC) is a trend that has radicalized the retail
industry over the past decades. Business owners look for ways to leverage their
investment and returns by towing this path. Of all the benefits that it accrues, it also
comes in handy with risks that can be as costly as damaging a company’s long earned
and much cherished brand not to talk of the complexity that is inherent in the
company’s supply chain. Consumer awareness of their immediate environment is
pushing them to demand more accountability in the companies they patronize their
products in which raw materials or labour have been sourced abroad. There have been
various concerns expressed also by various Non-Governmental Organizations (NGOs)
that are increasing this level of awareness
Corporate Social Responsibility is leading the demands by these organizations.
Ganesan, George, Jap, Palmatier and Weitz (2009, 85) cite Luo and Bhattacharya
(2006) that Social responsibility as perceived affects the images of brands and firms,
the propensity of consumer to buy specific brands and patronize certain retailers and
the financial performance of the firms. For instance, Wal-mart has been continuously
accused of poor working conditions of its workers in the U.S on reasons of temporary
employments with no full benefits, sidelining of women workers and bullying of
neighbourhood stores.

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Quick Response
This is simply the alternative designed in the US by textile manufacturers to
compete with counterparts who source from low cost countries to gain access to cheap
raw material and labour. The underlying idea here is to reduce inventory of unwanted
Work in Process (WIP) and balance inventory of fast moving products. This includes
reducing order lead time and a more frequent delivery of smaller lots amongst
partners. By so doing, the rate of stock turn is increased, and so has the amount of
product that has been cross docked. It uses relationships in the value chain to adopt
cost saving techniques powered by information technology. Losses are shared equally
by the supply chain partners. According to Fernie and Sparks (2009, 45), there have
been developments about the benefits QR adds to the business. Studies according to
Birtwistle, Siddiqui and Fiorito (2003) on U.K fashion retailers show that companies
adopting Quick Response (QR), according to financial appraisal, have not had
significantly better performance than their counterparts who did not. This
performance is spread over profit, cost, and inventory.
Efficient Logistics Activities
Logistics activities have been mentioned earlier including inventory,
transportation. The retailers are improving logistics efficiency for instance by using a
‘composite distribution’ system (Fernie and Sparks 2009, 10). This is the distribution
of mixed temperature items through the same transport and distribution center. It also
involves centralization in some specialist warehouse of slower moving stock. Earlier
this has been done separately in some cases because of the transportation regulations
that limit such activities.
Retailer Contribution Upstream the Supply Chain
The upstream supply chain normally includes the primary and secondary
distribution. The primary distribution is that from the manufacturing to the
warehouse/distribution center and the secondary from the warehouse to shop. The
retailers have increased their presence in both of these hierarchies of the supply chain.
This gives them the opportunity to utilize their own logistics assets, which usually is
included as part of the supplier task. The retailers resume the operation of the logistics
activities at the gate of the manufacturer which has given rise to the FGP (Factory
Gate Pricing), which means that transportation cost is not included in the price of the
merchandise from the supplier.

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Green Logistics
This is also an important aspect of the transformation in retailing. Apart from
the fact that retailers are more involved in product packaging than before, taking
control of marketing, labels and other sales & operation activities, mega stores like
Wal-Mart, Tesco, Asda are at the receiving end of the demand by customers to
provide more environmental friendly solutions for their reverse logistics. This is
actually seen more as a Corporate Social Responsibility of these companies. Smart
companies have anticipated that in future more consumers will be environmentally
conscious, and have increased their spend
Efficient Consumer Response (ECR)
This approach is geared to improve services and reduce cost in the grocery
retailing. The emphasis on collaboration between suppliers and retailers is to
standardize practices in order to eliminate unnecessary cost through the supply chain.
Such standardization for instance could be seen in material handling equipment.
According to Fernie and Sparks (2009, 49), the main focus for ECR is category
management, product replenishment and enabling technologies. These three focus
areas can be broken down further into sub parts. Participants in the ECR conferences
created a scorecard from Europe, U.S, Latin America and Asia, which was used to
appraise the performance of trading relationships.

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CHAPTER-IV
DATA ANALYSIS
AND
INTERPRETATION

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1. Are you satisfied with the performance of the KCP Cement?
Sl.no Number of samples 100
1 Yes 85
2 No 15
response
90
80
70
60
50
40 response
30
20
10
0
Yes No
INTERPRETATION:-
85% Dealers are satisfied with the cement performance.15% are not satisfied.

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2. Quality of KCP Cement
Option Respondent Percentage
69 69%
Excellent
Good 22 22%
Average 09 09%
Bad 00 00%
Percentage
Excellent Good Average Bad
0%
9%
22%
69%
INTERPRETATION:-
from the above analsysis 69% distibutors are Rated excellent about KCP
cemnt products,22% Distibutors are rated good ,Remaing are average about KCP
cement.

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3.Margin Satisfaction of dealers
61 61%
Satisfied
Average 31 31%
Not Satisfied 08 08%
Total 100 100%
Percentage
Satisfied Average Not Satisfied
8%
31%
61%
INTERPRETATION:
from the above analsysis about margins 61% distibutors are satisfiedt about
KCP cement margins,31% Distibutors are rated Average ,Remaing 8% are not
satisfed with margins about KCP cement.

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4. Price of KCP Cement
80 80%
Excellent
Good 14 14%
Average 6 6%
Total 100 100
%
Average
6%
Good
14%
Excellent
80%
INTERPRETATION:
The graph shows that 80% are satisfied with price of KCP cement 14% are
rated average.

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5.How is the behavior of the sales person at your first visit?
Number of Samples Respondent Percentage
30 30%
Good
Ok 60 60%
Irresponsible 10 10%
Total 100 100
response
60%
30%
10%
Good Ok Irresponsible
INTERPRETATION:
The graph shows that 60% of the sales persons are ok with their behavior
towards Dealers, 30% are good , and 10%.are irresponsible

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6.What ever the company has promised to you has been full filled?
Number of Samples Respondent Percentage
70 70%
Yes
No 30 30%
Total 100 100
%
70%
30%
yes no
INTERPRETATION:
It is inferred that 70% of the Dealers are satisfied with the company’s
fulfillment of promises only 30% of them are dissatisfied.

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7. The following table shows the Dealer satisfaction level with the staff greeting
and friendly welcome.
Staff greeting Frequency %

Highly satisfied 48 48%
Satisfied 32 32%
Moderately satisfied 12 12%
Dissatisfied 8 8%
Highly dissatisfied 0 0%
Total 100 100%
Staff greeting and welcome
0%
8% highly satisfied
12%
48% satisfied
moderately satisfied
32%
dissatisfied
higly dissatisfied
INTERPRETATION:
The graph shows that at Most of people are satisfied with Company people
attitude 48% highly satisfied and 32% are satisfied, only few percentage are not
satisfied.

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8.The following table shows the Dealer satisfaction with the time taken by the
staff to complete their requirement.
Time taken to complete the Frequency %

requirement
Highly satisfied 27 27%
Satisfied 37 37%
Moderately satisfied 23 23%
Dissatisfied 13 13%
Highly dissatisfied 0 0%
Total 100 100%
Time taken
0% highly satisfied
13% 27% satisfied
23%
moderately satisfied
37%
dissatisfied
higly dissatisfied
INTERPRETATION:
The graph shows that at Most of people are satisfied with Response time taken
by the Company staff to complete their requirement

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9 . How does the company respond to your complaints?
Number of samples 100 %
Quick 20 20%
Delay 65 65%
Ignore 15 15%
Total 100 100%
Graph 7
quick
relay
ignore
INTERPRETATION:
The graph shows that at a rate of 20% the Dealer complaints are reached quickly,
65% are delayed and rest ignored.

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10 Reason for Demand
No. of Dealers & Retailers

Features Birla Uttam Ambuja KCP Cement Bangur ACC
Quality 45 40 30 20 20
packaging 8 15 20 15 15
Price 12 15 20 50 45
reliability 35 30 30 15 20
120
100
15 20
35 30 30
80
reliability
60 12 15 20 50 Price
45
8 15 packaging
40 20
Quality
15 15
20 45 40
30
20 20
0
Birla Uttam Ambuja MahaCe-ment Bangur ACC
INTERPRETATION:-
The above table & graphical presentation shows that 42 dealers say Birla
Uttam demanded just because of reliability and 38 dealers says Birla Uttam demanded
because of quality. Ambuja & KCP Cement are in demand just because of quality but
if we see Bangur and Acc are demanded just because of low price. So in price both
Bangur & Acc is major competitor in market.

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11. How many brands have a Dealer / Retailer?
No. of brands No of retailer / dealer %

1 14 14%
2 24 24%
3 26 26%
4 14 14%
more than 4 12 12%
30
25
20
15
26
24
10
14 14
12
5
0
1 2 3 4 more than 4
INTERPRETATION:
The above table and graphical representation shows that most of the dealers &
retailers deals in three brands. No. of shops on which three brands are available are
26. There are very few shop which sale 1, 4, more than 4 brands, these are 14, 14 and
12 respectively.

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12. Brand preference of Dealers & Retailers
Brand Name No. of Dealers

Birla Uttam 24
KCP Cement 20
Ambuja 19
Acc 15
Bangur 12
Others 10
25
20
15
24
10 20 19 Preference of Dealers
15
12
5 10
INTERPRETATION:
On the basis of above table we justify that 22 dealers prefer Birla Uttam to
sale. Similarly KCP Cement and Ambuja are also high preferring brand in market
because they all are demand. Above graph depict only 15 dealers out of 90 prefer Acc
and 12 prefer Bangur. That shows Birla Uttam is highly preferable brand in district
city of Hyderabad.

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13. What are your suggestions to improve the sales?
Options Respondents Selection (%)
Improve Price Structure 22 22%
Improve product quality 38 38%
Improve Advertisement Policy 15 15%
Improve the distribution chain 25 25%
Total 100 100%
25% 22%
Improve Price Structure

Improve product quality
15%
Improve Advertisement Policy
38% Improve the distribution chain
INTERPRETATION:-
In this case we can see that 38% dealers/retailers are says, if you have better
quality product, it may help to improve the products sales and 25% dealers/retailers
are says, if you want to improve your sales, so you can consider the distribution chain.
22% & 15% are says improve the Price structure & Advertisement policy
respectively.

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14.Overall Rank
Rank Respondents Percentage

Brands
KCP 01 27 44%
ACC 02 18 30%
Coramandel 03 09 14%
L&T 04 06 10%
Birat Ambuja 05 01 2%
Total 100 100%
45
40
35
30
Maha
25 ACC
20 Coramandel
L&T
15
Birat Ambuja
10
5
0
Maha Coramandel Birat Ambuja
INTERPRETATION:-
From above analysis 44% are “ranked 1” for KCP cement, the second
position for Acc cement 30%

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CHAPTER-V
FINDINGS, SUGGESTION
&
CONCLUSION

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FINDINGS
 44% are “ranked 1” for KCP cement, the second position for Acc cement
30%
 38% dealers/retailers are says, if you have better quality product, it may help
to improve the products sales and 25% dealers/retailers are says, if you want to
improve your sales, so you can consider the distribution chain. 22% & 15%
are says improve the Price structure & Advertisement policy respectively.
 Most of people are satisfied with Company people attitude 48% highly
satisfied and 32% are satisfied, only few percentage are not satisfied.
 20% the Dealer complaints are reached quickly, 65% are delayed and rest
ignored.
 Birla Uttam 60% dealers & retailers says they are satisfied with problem
solving strategy of Birla Uttam. But in case of Binani 65% dealers & retailers
says these are better than Birla Uttam. Problem solving strategy of KCP
Cement and Ambuja is good, 58% and 55% dealers are satisfied.
 42 dealers say Birla Uttam demanded just because of reliability and 38 dealers
says Birla Uttam demanded because of quality. Ambuja & KCP Cement are in
demand just because of quality but if we see Bangur and Acc are demanded
just because of low price. So in price both Bangur & Acc is major competitor
in market.
 dealers & retailers deals in three brands. No. of shops on which three brands
are available are 26. There are very few shop which sale 1, 4, more than 4
brands, these are 14, 14 and 12 respectively.
 22 dealers prefer Birla Uttam to sale. Similarly KCP Cement and Ambuja are
also high preferring brand in market because they all are demand. Above
graph depict only 15 dealers out of 90 prefer Acc and 12 prefer Bangur. That
shows Birla Uttam is highly preferable brand in district city of Hyderabad.

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SUGGESTIONS
 The company should follow advance Communication strategies like email

newsletter, monthly flier, a reminder card for a tune up, or a holiday greeting
card, reach out to your steady Dealers.
 Company need to improve Dealer Service. Go the extra distance and meet
Dealer needs. Train the staff to do the same. Dealers remember being treated
well.
 in Dealer Incentives point of view. Give Dealers a reason to return to your
business. For instance, because children outgrow shoes quickly, the owner of a
children’s shoe store might offer a card that makes the tenth pair of shoes half
price. Likewise, a dentist may give a free cleaning to anyone who has seen
him regularly for five years.
 the company need to improve Product Awareness programs . Know what your
steady patrons purchase and keep these items in stock. Add other products
and/or services that accompany or compliment the products that your regular
Dealers buy regularly. And make sure that your staff understands everything
they can about your products. .
 Company Be Flexible with dealers . Try to solve Dealer problems or
complaints to the best of your ability. Excuses — such as "That's our policy"
— will lose more Dealers then setting the store on fire..

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CONCLUSIONS
Most of the respondents are happy with KCP Cement and it is most economical.
It is also concluded that there is a status symbol attached to the House. Many said that
the price of KCP Cement is reasonable, while some said that it is costly, while others
say it’s “VALUE FOR MONEY”. From the survey it can be concluded that KCP
Cement is good to those people who contract a House’s and Industries. Respondents
have rated the KCP Cement as most preferred choice in the terms of Package.
The study has revealed that Dealers while choosing a particular brand give utmost
importance to the easy and quick processing and friendly in employee’s nature Home
delivery includes delivering the cement to the owner at his doorstep. The company
has been generally able to deliver what is promised within the stipulated time frame.
Also, the popularity of the Directors of the company has created goodwill for the
company. Waiting period for the cement is comparatively low as compared to other
brands. A Dealer feedback form along with continuous after sales check by sales
executives forms the part of Dealers feedback system.

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BIBLIOGRAPHY
&
QUESTIONNAIRE

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BIBLIOGRAPHY
Company brochure: KCP Cement.
Booklet of dealer
Marketing research: Tull and Hawkings
Marketing Research: G.C.Beri
WEBSITE:
http://capitaline.com/
http://www.KCP cement.com/
http://www.indiacements.co.in/
http://www.ultratechcement.com/
http://www.gujaratambuja.com/

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QUESTIONNAIRE
1. Are you satisfied with the performance of the KCP CEMENT?
 Yes ( ) No ( )
2 .Quality of KCP Cement
Option Response
( )
Excellent
Good ( )
Average ( )
Bad ( )
3. Margin Satisfaction of dealers
Respondent
Option
( )
Satisfied
Average ( )
Not Satisfied ( )
4. Price of KCP
Respondent
Option
( )
Excellent
Good ( )
Average ( )

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5.How is the behavior of the sales person at your first visit?
Good ( )
Ok ( )
Irresponsible ( )
6.What ever the company has promised to you has been full filled?
Yes ( )
No ( )
7. The following table shows the Dealer satisfaction level with the staff greeting
and friendly welcome.
Staff greeting Frequency
Highly satisfied ( )
Satisfied ( )
Moderately satisfied ( )
Dissatisfied ( )
Highly dissatisfied ( )
8.The following table shows the Dealer satisfaction with the time taken by the
staff to complete their requirement.
Time taken to complete the Frequency

requirement
Highly satisfied ( )
Satisfied ( )
Moderately satisfied ( )
Dissatisfied ( )
Highly dissatisfied ( )

MBA PROGRAMME
9 . How does the company respond to your complaints?
Quick ( )
Delay ( )
Ignore ( )
10.Reason for Demand
10.No. of Dealers & Retailers
Features Birla Uttam Ambuja KCP Cement Bangur ACC
Quality ( ) ( ) ( ) ( ) ( )
packaging ( ) ( ) ( ) ( ) ( )
Price ( ) ( ) ( ) ( ) ( )
reliability ( ) ( ) ( ) ( ) ( )
11.How many brands have a Dealer / Retailer?
No. of brands No of retailer / dealer
1 ( )
2 ( )
3 ( )
4 ( )
more than 4 ( )

MBA PROGRAMME
12. Brand preference of Dealers & Retailers
Brand Name No. of Dealers
Birla Uttam ( )
KCP Cement ( )
Ambuja ( )
Acc ( )
Bangur ( )
Others ( )
13. What are your suggestions to improve the sales?
Options Selection (%)
Improve Price Structure ( )
Improve product quality ( )
Improve Advertisement Policy ( )
Improve the distribution chain ( )
14.Overall Rank
Rank Respondents Percentage

Brands
KCP ( ) ( ) ( )
ACC ( ) ( ) ( )
Coramandel ( ) ( ) ( )
L&T ( ) ( ) ( )
Birat Ambuja ( ) ( ) ( )

Sales and Distibution - Maha Cement

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MBA PROGRAMME

Narasaraopeta Engineering College Page 1

According to E. F. L. Brech, “sales management is the overall

2. Products to meets this demand.(3) means of interaction or intercommunications

Narasaraopeta Engineering College Page 2

The objectives of sales management are:

Objectives managing sales

Establishing the distribution set-up

Ensuring equity of shareholders

Establishing the distribution set-up: - The basic objective of the sales

i. Selling through the factory outlet only,

Narasaraopeta Engineering College Page 3

i. The total demand of the product,

Increasing Market share: -

Ensuring equity of shareholders: -

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OBJECTIVES OF THE STUDY

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SCOPE OF THE STUDY

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Design of the Study:

Marketing Research: G.C.Beri

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NEED OF THE STUDY

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LIMITATIONS OF THE STUDY

 Survey has been done in the limited area of Hyderabad city.

Narasaraopeta Engineering College Page 10

Narasaraopeta Engineering College Page 11

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History of Indian Cement Industry

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Ingredients Percent Range

Lime (Capo) 62 62-67

Silica (SiO2) 22 17-25

Alumina (Al2O3) 5 3-8

Calcium sulphate (CaSO4) 4 3-4

Iron Oxide (Fe2O3) 3 3-4

Magnesia (MgO) 2 1-3

Sulphur (S) 1 1-3

Cement – The Product

Narasaraopeta Engineering College Page 14

The artificial cement is obtained by burning at a very high temperature a

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ROLE OF CEMENT INDUSTRY IN INDIA GDP-FACTS:

 The KCP ltd (cement unite)

Narasaraopeta Engineering College Page 16

CEMENT COMPANIES IN INDIA:

S.NO STATE NO OF CEMENT PLANTS

Problems of the industry:

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Non –availability of Railway wagon:

Narasaraopeta Engineering College Page 18

Cement Export Prospects:

Recent Scenario of Cement Industry In India:

Narasaraopeta Engineering College Page 19

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Risks and Concerns

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Industry back ground

Demand and Supply