SALES &

5/6/2020 DISTRIBUTIO
N
MINI PROJECT

SUBMITTED BY-
AMALNATH BENNY (2019-1406-0001-0003)
RABNEET SINGH (2019-2706-0001-0003)
SUSHMITA GHARAMI (2019-0608-0001-0005)
CHETAN CHAND (2019-3008-0001-0002)
SHALINI PRIYA (2019-20005-0001-0022)
Contents
Fountain Pens: Reveal the Beauty of Your Signature.....................................................................2
MISSION-....................................................................................................................................2
VISION-.......................................................................................................................................2
Fountain Pen Categories.......................................................................................................2
Fountain pen in India...................................................................................................................3
PREFERABLE DISTRIBUTION FOR EACH CATEGORY..........................................3
Famous stores in Pune...........................................................................................................5
Target audience............................................................................................................................7
Market size value.........................................................................................................................9
Potential customers......................................................................................................................9
MANUFACTURING OF A FOUNTAIN PEN-..................................................................9
Raw materials and its cost..................................................................................................13
Cost of producing a Pen.................................................................................................................14
Margin for Two level distribution channel......................................................................14
Margin for One level distribution channel.......................................................................15
Margin for Zero level distribution channel......................................................................16
Profit Earnings...............................................................................................................................16
PROMOTIONAL STATERGIES.................................................................................................17
TARGET MARKET..................................................................................................................18
Advertisement through TV adds................................................................................................19
SOCIAL MEDIA PROMOTION..............................................................................................19
Mail Order Marketing................................................................................................................20
Free sample Product...................................................................................................................20
Point of Sale Promotion and End Marketing.............................................................................21
Packaging Cost..............................................................................................................................21
Reference.......................................................................................................................................23
 Fountain Pens: Reveal the Beauty of Your Signature
The soft delicate touch of the feather-shaped nib will beautify each letter on the paper and the
water-based liquid ink will leave an authentic impression.

COMPANY NAME: - ORNATE CALAMUS

TAG LINE: - BEHOLD YOUR ELEGANCE

MISSION-
To become one of the largest manufacturer and leading brand in Indian Market.

VISION-
We dream to see our pen used by each individual in India.

Fountain Normal usage

Pen
Categories
Semi-
luxury

Luxury

Premium
Fountain pen in India

4500 Crore Growing Writing

organised
writing at 8-10% instruments
instruments CAGR category

Rankings:
Pen
1) Cello
2019 market
in India 2) Flair
Pens

Sector- Overall
Market
Consumer share
Fountain Pen
Goods 10%
PREFERABLE DISTRIBUTION FOR EACH CATEGORY

Normal
usage

Intensive
Selling through as
many outlets as
possible, so that the
consumers
encounter the
product virtually
everywhere they go

Semi-
luxury

Selective
Intensive
1. Few exclusively
chosen retail outlets
in a specific
geographical area
2. As many outlets
as possible
Selective
Exculsive
1. Few exclusively
chosen retail outlets
2. Only certain
retailers are given
the option of
carrying a product in
its store
 Premium

Exclusive
Only certain
retailers are
given the option
of carrying a
product in its
store

Famous stores in Pune

 Vaibhav Stationery And Book

 Mahavir Book agency

 New PPC Stationary

 Parv Stationary and gift shop

 Shraddha Enterprises

 My stationary
 A focus on high-quality, We are focusing on semi-
beautiful products with a luxury and luxury branding
particular emphasis on color so price would be medium to
& design expensive

Wide distribution network in Create a targeted,

pune region that’s consistent marketing
supported by a network of campaign that appeals to
reputed licensed retailers the heart of their target
audience
 MARKET SHARE
2019

FOUNTAINLUXURY PEN
PEN 6%
4%

GEL PEN
20%

BALL POINT
PEN
70%

BALL POINT PEN GEL PEN FOUNTAIN PEN LUXURY PEN

Target audience
 Businessman’s
Professors
Chartered
Accountants
Doctors
Architects
lawyers
SEGMENTATION
GEOGRAPHIC- ALL OVER INDIA, SPECIFICALLY IN TIER II CITIES.
DEMOGRAPHIC- Age Group: 20 and above , ALL GENDER
Occupation – HODs, Trustee , doctors ,lawyers , CA , Officiers
BEHAVIORAL- STANDARD/ REPUTATION CONSCIOUS

TARGETING
Those who consider pen as symbol of standardism.
People fond of writing
Calligraphy
Higher post authorities

POSITIONING
Positioning as signature pen. One that provides it owner the feel of satisfaction while writing.
Brings in elegance in oneself
Point of parity - varieties of design, ranges of prices,
Point of difference – quality , affordability , Customizable
Market size value
1. Total population of Pune city as per 2011 census was 5057707. It is assumed to be grown
by 40% till 2020
2. Therefore, current population is estimated to be 5057707*140%=7080789.8
3. Percentage of children of age (0-6) were 11.46%
4. Therefore, Total population – population of children below 6 years old =7080789.8-
11.46%*7080789.8 = 6269331.289
5. Penetration of pen is 80%, Therefore No. of customers = 80%* 6269331.289
6. Total No. of customers for Pen= 5015465.03
7. Penetration of Fountain Pen =10% of penetration of pen = 10%*5015465.03=501546.5
8. Fountain Pen/person used in 6 months =1, Therefore 2 pens per year
9. Total Fountain Pen required in year = 1003093.006
10. Average cost of Fountain pen = 900rs
11. Market Value of Fountain Pen = 902783705 (90.27 Cr)

Potential customers
1. Top 10 I.T companies have employee of of approx. 2000 per company and with a team
lead between 4-5 employee Therefore total team leads= (3000/5) *10=6000
2. Team leads per company for smaller I.T company is 25/company, therefore for 250 I.T
company total employee 250*30 = 7500 Heads
3. Number of famous doctors in Pune = 10000
4. Number of chartered Accounts = 222
5. Total Architects = 70
6. Total College in Pune is 811. Assuming an average of HODs, trustees and principal per
college to be 10 Therefore total of 8110
7. Well-known Lawyers in Pune = 1500
8. There are 154 schools in Pune. Assuming an average of 15 teachers/ school=2310
9. Therefore, Total potential customers=
6000+7500+10000+222+70+8110+2310+1500=35712
10. Total fountain pen/person in a year = 2
11. Therefore, total Pen required by potential customers (35712*2) = 71424 Pens in a year
12. Assuming Ornate Calamus could achieve 5% of total sale = 5%*71424= 3572
13. Therefore, Pen produced by Ornate Calamus in a year = 3572

MANUFACTURING OF A FOUNTAIN PEN-

The larger pen manufacturers use automated processes to produce fountain pens. However, some
smaller companies and individuals continue to create pens manually. The materials and
processes used by different companies and individuals vary. Here is the process used to create
handmade pens from wood. This same process, or similar processes, can be used to create pens
from other types of materials as well.
PROCESS INVOLVED IN MANUFACTURING-
a) Preparing the blank
a) The first step in creating the pen is to prepare a blank, a rectangular piece of wood
that will be filed and shaped into the two halves of the pen barrel. Virtually any
type of wood can be used. However, it must be dry when the process begins.
Colorful woods with interesting patterns are preferable because they make for a
more attractive finished product. To prepare the blank, the wood is first cut into a
rectangle approximately 0.75 in 2 × 5 in long (1.9 cm 2 × 12.7 cm).
b) Then, the blank is marked with a line (called a match mark) extending about 1 in
(2.5 cm) beyond where a cut will be made separating the blank into two halves, an
upper and a lower. The blanks are then crosscut into lengths that are slightly
longer than the brass tube that will eventually be inserted into them. One way for
the crosscut to be made is with a band saw equipped with a miter gage and an
auxiliary slip fence, which is an adjustable fence especially made for cutting
different lengths of pen blanks.
c) The blanks are then held in place using a jaw clamp or some other similar method,
and a hole is drilled down the center of each half of the blank in preparation for
the insertion of the brass tube. Each blank section is held in place with the match
marks facing up.

b) Inserting the brass tube

a) Once the holes are drilled, polyurethane glue is applied to both the outside of the
brass tube and the inside of each drilled hole. Then, the tube is inserted into the
blank using a rotating motion to distribute the glue evenly. After approximately
10 minutes, the glue is usually dry and the tube stays securely in place.
b) With the pen secured, the tube is trimmed to fit precisely in the blank using an
adapter sleeve and a barrel trimmer until a brass curl is produced.

c) Mounting and turning the blank

a) Once the tube is inserted, the upper and lower blanks are ready for mounting on a
mandrel in preparation for turning. A split mandrel system, consisting of two
short steel mandrels, is generally used. Each blank is mounted separately on the
split mandrel along with the appropriate bushings.
b) As each blank spins, the wood that does not belong on the pen is carefully cut
away using a gouge or similar tool. Finishing cuts are made using a skew chisel.
c) A notch is carved around the upper blank, completely through to the tube, using a
thin parting tool. This notch is where a metal trim ring will later be inserted.

 Sanding and finishing

a) Now the blanks have turned into pen barrels, ready for sanding and finishing.
Sandpaper, starting with 120-grit and progressing to 180-grit, 220-grit, and finally
 320- or 400-grit, is used to ensure a smooth finish. If Dymondwood is used, a grit
as fine as 600 may be necessary for a high gloss finish.
b) The pen barrels are coated with a wax Vo r plastic polish, applied with a soft cloth
while the barrels are still spinning.

 Preparing the assembly

a) Prior to assembly, the sharp corners on each end of the finished barrels are sanded
slightly.
b) If a clip is to be used, a notch is cut in the upper barrel in preparation for its
insertion. To avoid chipping the wood, a grinding wheel or a file is used to cut
this notch.

 Clips, Fittings and bands

The clips and metal fittings used on fountain pens are stamped, just as when the fountain
pen was first produced. Bands and overlays are rolled from sheet metal and hard
soldered.

 Final Assembly
a) Now the ring, clip, and other metal trimmings are attached to the finished barrels
to make a completed pen. A drill press and press jig may be used to press the pen
parts together. The drill press is used as a vice, while the jig (a long, flat piece of
wood with metal posts sticking up) is used to keep the parts in line during
assembly. First, a nib coupler is pressed into the large end of the lower barrel.
Then the lower barrel is flipped over, and an end cap is pressed into the smaller
end. The nib is then inserted into the nib coupler.
b) Next, the trim ring and clip assembly are inserted into the previously created
notches in the upper barrel. Then a closing cap is screwed in place using a cap
adjuster tool or Phillips screwdriver to complete the assembly of the upper barrel.
c) Finally, the two barrels are screwed together and the fit is tested and adjusted with
the cap adjuster or screwdriver if necessary.
AUTOMATED PROCESS-
The process used to make fountain pens at larger companies is generally more automated. These
companies use specially tooled machines to mold the pen barrels, usually from molten plastic.
Machines also do the stamping and crimping of the metal parts, assemble the final product, and
even take care of the polishing and cleaning.
PACKAGING-
Primary Packaging
 The packaging that most closely touches a product, often referred to as “retail
packaging.”
 Its main goals are to protect the product and inform or attract a customer.
 What’s considered to be primary packaging depends on the product. For example, a pop
can is primary packaging (because it’s the primary way to carry around soda), while a corrugated
box containing a camera and its accessories is also primary packaging (because it’s the primary
way to purchase it).

Rigid boxes

Rigid Boxes are a very common type of packaging and they are often associated with luxury
products. Rigid boxes are typically four times thicker than an average folding carton and are not
usually printed on directly. ... Rigid boxes, as the name suggests, are rigid and sturdy.

I’m sure you’ve always wondered the type of box they used to package iPhones or those luxury
retail products such as Rolex, Tiffany & Co
and Marc Jacobs. You have a sense that
it’s a type of cardboard but still
wasn’t sure because of its durable and
premium appearance. This type of cardboard
material is called a rigid box.

A rigid box is made out of highly

condensed paperboard that is 4
times thicker than the paperboard used in the
construction of a standard folding carton.
The easiest real- world example of rigid
boxes are the boxes that hold Apple’s
iPhones and iPads, which are 2 piece setup rigid boxes.

Compared to paperboard and corrugated boxes, rigid boxes are definitely among the most
expensive box styles. The rigid boxes usually do not require dies that are expensive or massive
machinery and are often hand-made. Their non-collapsible nature also gives them a higher
volume during shipping, which easily incurs higher shipping fees.

These boxes are commonly used in merchandising cosmetics, jewelry, technology, and high-end
luxury couture. It is easy to incorporate features such as platforms, windows, lids, hinges,
compartments, domes, and embossing in a rigid box.
Rigid boxes are very common type of packaging and they are often associated with luxury
products. Rigid boxes are typically four times thicker than an average folding carton and are not
usually printed on directly. They are instead wrapped with paper that can be as plain or luxurious
as desired.

Rigid boxes as the name suggests are rigid and sturdy like shoe box, I phone, and other high end
electronics use rigid boxes, as do many beauty and high end food products.

RIGID BOXES WITH TELESCOPIC LIDS-

Rigid box consists of 2 parts- a lid and a base (or top or bottom). Telescopic lids have a lid that
covers either the entire base called a full telescope or just part of the base called a partial
telescope.
We will use full telescopic lid; it is like on chocolate or candy boxes which have a lid that covers
the entire base of the box.
Full telescopic lid has “thumb cuts” to make opening of the box easier.

Raw materials and its cost

• Raw materials required and its per kg cost

Raw materials Cost/kg

Silver 41000
Steel 200
Plastic polymers 80
Brass 310

• Requirements to make a pen

Parts Initial Final Cost

weight (gm) weight(gm)
Nib (Silver ) 1.3 1 53.3
Body (brass) 20 15 6.2
Cap ( plastic polymer) 15 10 1.2
Cap (steel) 8 5 1.6
Total cost per pen 62.3

Fixed cost
 2 skilled labor (Rs.15000/labor ) Rs.30000
3 semi-skilled labor (Rs.8000/labor) RS 24000
Electricity per month Rs 8000
Rent / month Rs 10000
Total Fixed cost/ month Rs 72000

Variable Cost
PARTICULARS AMOUNT

RAW MATERIAL COST 18565

PACKAGING COST 44700

Investment
Welding and turning machine and other sharpening tools= Rs 5,00,000

Cost of producing a Pen

 Total production of pen per year = 3572
 Total pen produced in a month (3572/12)= 298 Fountain pen
 Cost of 240 Fountain pen = 298*Cost of raw material per Pen(62.3)=Rs.18565
 Fixed cost/ Month = Rs.72000
 Packaging Cost = 150/per pen for 298 Pens = Rs.44700
 Investment is considered to done for 3 years = 500000/36 = Rs. 11112
 Therefore Total Cost (18565+72000+11112 + 44700) = Rs. 146377
 Cost per Fountain Pen production = 146377/298 = Rs 491/Fountain Pen

Margin for Two level distribution channel

Channels Unit cost Margin % selling price margin

Manufacturer 491 24% 609 118

Distributor 609 23% 749 140

Retailer 749 20% 899 150

Margin
Margin(Rs)
%
Margin for One level distribution channel
160
25%
140 24%
24%
Channels
120 Unit cost 23%
Margin % selling price margin
23%
100
22%
Manufacturer
80 491 40% 687 196
21%
60
20%
Distributor
20%
40 609 31% 900 213
19%
20
0
18%
margin Margin %

Manufacturer
Manufacturer Distributor
Distributor Retailer
Retailer
 Margin % Margin (Rs)
45% 215
40%
210
35%
30% 205
25%
200
20%
15% 195
10%
190
5%
0% 185
Margin % margin

Manufacturer Distributor Manufacturer Distributor

Margin for Zero level distribution channel

Channels Unit cost Margin % selling price margin

Manufacturer 491 83% 900 409

Manufacturer
1000
900
800
700
600
500
400
300
200
100
0
Unit cost Margin % selling price margin

Profit Earnings
• Total Pen produced in a month = 300 Fountain Pen/ month
• 40% Pen is sold through own website (40%*300)= 120 Fountain Pens
• 30% Pen is sold through Online aggregator / Pen shops(30%*300)=90 Pens
• 30% Pen is sold through two level distributor (30%*300)=90 Pens
 • Profit through different Distribution channels
• Maximum Retail Price= Rs1000 , Market Operating Price= Rs 850
• Zero level distribution channel
Discount offered to customer through website- 15%
Margin per Pen = 359
Therefore Profit in a month= 359*120= 43080
• One level distribution channel
Margin per Pen =196
Profit (196*90)=17640
Two level distribution channel
Margin Per Pen = 118
Profit(90*118)=10620
Total profit =10620+17640+43080=71340

PROMOTIONAL STATERGIES

TV
ADVERTISE
MENT

SOCIAL MAIL ODER

MEADIA STATERGIES MARKETING
PROMOTION ADOPTED

FREE
SAMPLE
PRODUCT

Promotion is one of the marketing mix elements. These elements are personal selling,
advertising, sales promotion, direct marketing, and publicity. A promotional mix specifies how
much attention to pay to each of the five subcategories, and how much money to budget for each.
A promotional plan can have a wide range of objectives, including: sales increases, new product
acceptance, creation of brand equity, positioning, competitive retaliations, or creating a corporate
image. Fundamentally, however, there are three basic objectives of promotion:

 To present information to consumers as well as others

 To increase demand
 To differentiate a product from others in the marketplace

There are different ways to promote a product in different areas of media. Promoters use Internet
advertisement, special events, endorsements, and newspapers or magazines to advertise their
product. Many times with the purchase of a product there are incentives like discounts, free
items, or contests. These methods are used to increase the sales of a given product.

Promotional strategies to be adopted

 Advertisement through TV adds

 Social media promotions
 Mail order marketing
 Free sample gifts

TARGET MARKET
TARGET AUDIOUNS NO OF TARGET AUDIONS

TOP 10 IT COMPANIES 6000

2000 / 3000 EMPLOYEE (3000/5)*10

4 / 5 TEAM LEADER

250 SMALL IT COMPANIES (HEAD) 7500

FAMOUS DOCTORS IN PUNE 10000

CHARTERED ACCOUNTANTS 222

TOP ARCHITECTS 70

TOP COLLAGE PROFESSORS 8110 +2310

(ASSUMING AVE HODs AND
PROFESSOR, TOTAL COLLAGE IN
PUNE 811)

15 TEACHER/ SCHOOL

( TOTAL SCHOOLS 154) i.e 154*15

TOTAL TARGETED AUDIENCE 34212

(APPROX FIG 35712)

Advertisement through TV adds

COST INCURED FOR TV ads AVERAGE FOR 30 SEC

TARGETED CHANNEL

Sr.no CHANNEL (7-9 am) RATE/ 10 SEC(RS) F0R 10

DAYS

1 TIMES NOW (7-9 am) 4950

2 SONY ENTERTAINMENT INDIA (7-9 am) 6240

3 AAJ TAK (7-9 am) 3350

TOTAL COST 14540

SOCIAL MEDIA PROMOTION

 Promotion through face book

Target population = 35712

Advertisement cost for one month =20000

Therefore, For one month = 20000/30 = 666

 Promotion through Instagram

Target population =40,000 to 110,000

Advertisement cost for 1 day = 560

Therefore, for one month the cost is 560*30= 16800

There are various platforms online where we can promote our products and can reach a huge
number of audiences.  There is hardly any person who is not using either Facebook or Instagram.
By using this platform, we can make people aware of your product. You can talk about its uses
and how it is essential for them. In addition to this, you can show people how your product is
better than other similar product.

Mail Order Marketing

our company is still breathing just because of your customers. once customers have used your
product and liked it, there are chances that they are going to be connected with us for a long
time. Therefore, don’t make a mistake to overlook these customers. We ask them to share their
personal details in exchange for free gifts or services. We use that information to promote our
product in a new market where people are totally unaware of the existence of your product.

Free sample Product

Target population = 2857

Price of per ink bottle = 80
Total cost = target population *price
= 228560

This promotional strategy is used by both small as well as powerful companies. By using this
strategy, you can boost the sale of your product instantly. This strategy is mostly adopted by food
or cosmetic companies. They provide a sample of their products free of cost and make people try
new products.
  Here we can provide free sample of ink bottle to the custome in order to attract the
customer

Point of Sale Promotion and End Marketing

In stores, products are displayed strategically so that they come first in the eyes of
customers as soon as they enter the store. Stores do this for two
reasons convenience and impulse.
Many times, you have noticed a rack displaying attractively
offers on a certain product or many products are displayed near
the aisle of the store.
There are reasons why stores do this.

They do this either to boost the sale of the product or when they
want their stock moving.
This strategy makes people buy certain products impulsive while
they wait for their turn to check out.

Therefore, total expenditure on promotional strategy

= sum of all the total expenditure i.e. (television add, social media promotion, free sample
product)

= 14540+20000+16800+228560
=279900

TOTAL EXPENSES ON PROMOTION OF FOUNTAIN PEN = 279900

RIGID BOXES-

Packaging Cost

COST OF The box- Weight of the box * per kg cost of chipboard sheet*per kg cost of wrap
Weight of the box= 0.5 kg
Per kg cost of chipboard sheet= Rs 31.5
Per kg cost of wrap= Rs 9.5
Therefore, Cost= 0.5*30*10= Rs 149.625=Rs 150
Box Size- 15.5cm X 7.5cm
Materials required-
Chipboard sheet
Wrap
Glue

Reference
http://www.madehow.com/Volume-7/Fountain-Pen.html
https://exceldatapro.com/promotion-rate-calculator/
https://www.thepackagingcompany.us/knowledge-sharing/3-levels-of-packaging/
https://www.vistaprint.in/marketing-materials/labels-stickers/product-labels?
GP=05%2f04%2f2020+08%3a27%3a20&GPS=5672262504&GNF=1
http://www.economicsdiscussion.net/marketing-management/what-is-packaging/31951
https://www.packagingstrategies.com/blogs/14-packaging-strategies-blog/post/89440-packaging-
types-to-consider
https://howtobuypackaging.com/types-of-packaging-rigid-boxes/
https://www.slideshare.net/virtuinstitute/lecture-5-packaging-materials-and-labelling
https://www.thepackagingcompany.us/knowledge-sharing/3-levels-of-packaging/
https://howtobuypackaging.com/how-much-does-packaging-cost/