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A Report On Sales And Distribution System Of Choice Laboratories Prepared by :- Patel Harshad R. Submitted to :- V.M. PATEL INSTITUTE OF MANAGEMENT M.B.A. Programme Ganpat Vidhyanagar, Kherva. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY M.B.A. Programme Chinchwad. Pune CERTIFICATE This is to certify that Raval Sunil D. of Sem 2nd of M.B.A. Programme, Roll no. 31 has satisfactory completed his project report on Export Procedure for project work during the academic Year 2006 – 2007. Date :- Place :- Kherva V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Concern Professor. Principal:- PREFACE Practical training is a very important constitutes in the field of education. This is prescribed by Pune University. It is the time in which we can implement our theoretical knowledge in practice. In industrial have selected the topic from marketing management that in “sales & distribution” marketing is the core of business activities in modern. I visited giant industry during my practical training. I enjoyed my visit and learn so many things about marketing. Practical training is very helpful for our development. I have visited company named:- “Choice Laboratories, Unjha.” V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Raval Sunil D. 1st Sem , M.B.A. Roll No. 1111 ACKNOWLEDGEMENT This is the movement I want to dedicate some special that had help me a lot in this study part. I express my graduate to those people from bottom of my heart. These persons are:- 1) Mr. Vikram Bhatt (Export Manager). 2)Mr. Ajit Borde (Course Co-Ordinator). Over all I want to express deep thanks to all those had knowingly or unknowingly, directly or indirectly helped me. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Your faithfully, Raval Sunil D. 1st Sem M.B.A. Roll No:- 1111 Contents ♦ General Information V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY ♦ Sales Department ♦ Distribution channel ♦ Conclusion General Information Contents ♦ Company Profile V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY ♦ History & Development ♦ Management Structure ♦ Quality Policy ♦ Product Design ♦ Pricing Policy History & Development Every plant has special story. So when any plant located at any where at that time history would be there. History of the unit provides guidance about the past situation. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Choice Laboratories is a partnership firm. It was established in May 1982, at Unjha. The commercial production of the company was started in January 1983. at the time of company was producing only tooth paste and tooth powder but now a days company produces other cosmetic items. Initially Choice Laboratories had only one department. At that time company was initially concentrated on Gujarat only but now they have more department in all over the India covering states namely Rajasthan, Maharashtra, Uttar Pradesh, Bihar, Punjab etc. The company has appointed one main dealer in each department. These dealers are responsible for covering all the marketing activities as the company. Choice Laboratories had nine partners at the time of establishment but now the firm has only two partners. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 1) Ashwinbhai Patel 2) Gunvantbhai Patel Choice Laboratories gets financial help from financial institution and Bank. Some own capital was also included by the managing partners. Since, March 1988 the firm making export. At present choice Laboratories export to more than Ten countries. Choice Laboratories exports in Dubai, Oman, U.S.A., South & West Africa, Russia, Bangladesh, France etc. The firm exports products under various brand name choice as made hat trick in winning best exporters of the year, awards in 1991, 1992, 1993. Management Structure Managing partners :- V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY ♦ Shri Gunvantbhai Patel ♦ Shri Ashvinbhai Patel Managers Of The Unit:- ♦ Mr. Vikrambhai Bhatt (Export Manager) ♦ Mr. Deepak Saxena (Marketing Manager) ♦ Mr. Vinit Mehta (Production Manager) ♦ Mr. Samir Raval (P.A. to Partners) ♦ Mr. Nitinbhai Shah (C.A.) Auditor:- ♦ M/s M. B. Associates Banks:- ♦ State Bank Of India ♦ Dena Bank ♦ Unjha Nagrik Co- Operative Bank Ltd. ♦ Mehsana Co- Operative Bank Ltd. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY PRODUCT DECISION Product decision covers all the decision regarding goods and services. It includes concept of product, products plan, product mix, product line etc. 1) Concept Of Product:- In the simple words product means any thing that can be affect to some one to satisfy need and want produced should be considered as a bundle of satisfaction. The product is the most important tool in the marketing. Without a product there is no question of marketing. In choice Laboratories all decision regarding product are taken by Managing Partner and Marketing Manager. 2) Product Mix:- V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Product Mix is the list of all product for sell by company. It is defined as the composite of product offered for sells by firm as business unit. The following is the Mix of Choice Laboratories ● Choice Tooth Paste ● Gel Tooth Paste ● Stand up Tube ● Tooth Powder ● Tooth Brushes ● Shaving cream ● Shampoo ● Talcum Powder ● Prickly Heat Powder V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 3) Product Line Product line refers to a group of product that are closely related because they satisfy a class of product that are used together are sold to the some customers are marketed through the same type of out lays or full given price changes. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY QUALITY POLICY The manager of staff of M/s Choice Laboratories Unjha is committed to increase its market share by manufacturing product of international quality consistently which is achieved by ♦ Studying the market trend and the customer’s need. ♦ Continuous improving upon the quality system. ♦ Manufacturing cost effective products. It is the aim of every individual to contribute toward achieving the object set by Manufactures each year. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY PRICING POLICY When all the production process is finished and the product to ready then after the most important task of the promoter is to determine the price of the products. Determination of price is the most important task. At the time of deciding price of the product, the promoter takes into mined the price of the competitors, consumers demand, utility of the product, how many expenses included after the production, consumer attitude towards products etc. Generally in small business the price of products depend on the expenses incurred after production and to make the product qualitative. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY SALES DEPARTMENT 1) Introduction 2) Sales Planning 3) Code of Conduct of Sales 4) Sales Management System 5) Recruitment of Sales Persons 6) Selection of Sales Persons 7) Training of sales Persons V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 8) Sales Force Management 9) Sales Survey 10) Export 1) Introduction of sales Choice Laboratories manufactures goods which are for use of final consumer only. They have wide product lines which includes Tooth paste, Tooth powder, Shampoo etc. The company is marketing in domestic as well as internationally. For this it has set the distribution channels of its own production and sales of this products and sales of this products in the year 1996 and 1997 is assumed. Products production domestic Export (in Unit) Markets Markets Choice T.P. 1,00,000 30,000 70,000 Choice T.Pow. 75,000 20,000 55,000 V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Choice T.Brush 40,000 20,000 20,000 Herbal Shampoo 78,000 40,000 38,000 The turnover of the company has been increase at the rate of 1.5% per year. 2) Sales Planning It is very essential to planning is done before doing varies activity are involved in planning for sales of companies products namely this activities involved following activities. ♦ Marketing Research ♦ Product Research ♦ Recruiting sales personnel ♦ Selection of Channel ♦ Physical Distribution Choice Laboratories sales planning. It is involved in marketing consumer’s products so it mainly uses secondary duty and sometimes primary data also. In export market some surveys are also being V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY done. The selection of channel is done a several criteria. 3) Code Of Conduct For Sales:- Company has formed out its own policy for selling and distribution. It has code of conduct annual for the employees in brief this policy is presented as under ♦ Norms regarding product to be sold. ♦ Deciding the consumer of the product. ♦ Having close touch with the channel members. ♦ Advertising and promotional policies. ♦ Smooth relationship with channel members. ♦ Attractive packing style. ♦ Attractive Branding style. In short can say that Choice Laboratories has adopted and inter style sales policy that coyer cell aspects related with sales and distribution its interest to giving enthusiasm to regular customers and finding out an attractive the new customers each employees is charged with particular group of responsibility which they have to perform strictly in accordance with the V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY policy. It also aim as providing through competition to the competitors like:- 1. Colgate. 2. Babool. 3. Close-Up. 4. Pepsodent. 5. Anchor. 6. Acquafresh. 7. Vicco. Thus it has very sound sales policy. 4) Sales Management System:- Sales organization being the back done of an organization. Understanding it in term of structure field organization job description, reporting, relationship, authorities, duties, responsibilities of different position in sales department imperative. Structure of Sales Department Managing Partner V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Marketing Manager Sales Manager Accountant Area Sales Executives Senior Sales Executives Sales Executives Sales Representatives 5) Recruitment Of Sales Personnel Recruitment of trained and qualified sales personnel is quite essential issue for development and increasing the sales of the company. Assigning sales personnel to sales territory is such a crucial issue that reputed V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY management author like Philip Kotler has also noted one time that keen and sharp intelligent of the sales representative is the only things that makes the company success in sales force management and wining higher market share. That’s way the recruitment of sales personnel must be done in prescribed and clear cut way. Choice Laboratories has very good recruitment process for finding out the best sales representatives. Choice Laboratories follows centralized recruitment procedure by screening out all applications its find out the number of persons to be called for an interview. 6) Selection Of Sales Personnel:- Selection process at Choice Laboratories with calling a applicants for the V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY interview. Interview is intended to find out the potential capabilities of the candidates. Interview may be of various type but Choice Laboratories follows simple procedure so that the application may not become desire and confused by complicated interview system. So that the application do not hesitated to tell or discuss or anything and tell the facts and information that the company is waiting to know from him. 7) Training Of Sales Personnel After selection it may happened that selected sales personnel may have not proper V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY knowledge of market of the company or he may lack. The sales require for the marketing of that products. That is way training become very necessary. Choice Laboratories try to exploit the opportunities related to increasing effectiveness of sales representative but Choice Laboratories do not have any pre planed and formed procedure for training of sales representative. The nature of the training depends upon the nature and type of the product which assign to the particular sales personnel. After having such a good training sales representative of Choice is now ready to enter in the market with enthusiasm, confidence and knowledge. 8) Sales Force Management:- V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY It requires a large scale attention to be provided on Sales Force Management. There are five involved in sales force planning. 1. Assigning of sales personnel. 2. Training. 3. Deciding on salary compensation. 4. Supervision. 5. Assigning their performance. Their detail information is as follows:- 1. Assigning of Sales personnel. Choice Laboratories provides a distinct system of sales force requirements. Fist of the need is determined of sales representation then advertisement is given in leading news paper. Then a formal interview is held and required quality of sales person is chosen by Choice Laboratories. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 2. Training:- It is the selected sales person is found to be taking skilled. It may be give either by experienced works on by out side experts 3. Deciding On Salary Compensation:- Deciding on salary compensation is a very crucial task. The sales representative’s expectation and management goals may come influent of each other or make class. 4. Supervision:- It is necessary to ensure that sales force work in the same directly that is directed by the company for this purpose of the management supervision for performing the activities of sales representatives. They have to flit in daily sales report and other firm for this purpose. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 5. Assigning their Performance:- Assigning their performance is the most require activities on part of management to see that the sales force are achieving the goals of the management. The irregular or inefficient sales personnel may be given warnings may be taken action against to him. 9. Sales Survey:- The intention of my sales survey is to find out the company share in the market and tends as growth. Various area in which I made survey is made under:- ♦ Company’s sales and competitors sales. ♦ Source of Details. ♦ Published Literature. ♦ Retailers and Whole seller personnel meet. ♦ Annual report of various companies. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 10. Exports:- Choice Laboratories has also having excess in international market 80% of its production are sent to be exported which are the cosmetic most preferred in foreign consumers because of its special and unique characteristics. That makes the product more and more useful for the foreigners. In additional the firm also having ISO 9002 certificate for quality control of the products which adds to reputation and ultimate benefits to the company. The main international buyers of the company are the fringing country’s like Bangladesh, U.S.A. etc. Only 20% of the production is made for sale in Domestic Market. The payment terms are lubrication by the company and 50% to 60% payment is done by Dollar Currency, remaining 50% payment is done by Indian Currency. The ordering country give that art structure and brand name to choice to Gel in printed on the packaging to the V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY brand name various by company and country to country. Thus Choice Laboratories is sold under different brand names in foreign market. In U.S.A. :- 1. Simi Brand Fluoride. 2. Choice Calcium Plus. 3. Choice Double Mint. 4. Choice Fresh Gel. 5. Choice True Gel. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Distribution Channel CONTENTS 1. Introduction. 2. Decision Parameter for Distribution Channel 3. Distribution Channel 4. Motivation to Channel Members 5. Physical Transportation Fleet 6. Warehouses. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 1. Introduction:- Distribution is set of market institution participating in the marketing activities involved in the movement on the flow of goods or services from the primary producers to the ultimate consumers. It has been said that nothing happened until some one sales something to somebody. Being the only revenue center of the organization sales and distribution departments holds a strategy position imaging trends of customization extensive services to the customers making products qualitable to do step of customers and cut through competition make it imperative to V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY study and understand the way sales and distribution departmental functions in read world situations. 2. Decision Part Matters for Distribution Channel:- The following are the major consideration involved in decision regarding distribution channel :- 1. Product:- The main product of the Choice Laboratories are non perishable type of products. So that the channel selected by the company does not involved merchant members that may be burden some for the company. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 2. Market:- The target market of the company is consisting of the customer of four type and all it means lower level, middle level, upper level customers so it is the reason by the company has selected for level distribution level. 3. Channel Used by Competitors:- The main competitors of Choice Laboratories like colgate, Palmolive, Hindustan lever & Vicco Laboratories has established an effective marketing channel to reach every corner of the market. The channel used by these competitors has also been considered while deciding on a distribution channel. 4. Purchasing Pattern of The Consumer:- V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY It includes the consumer mainly, psychology and habits that affect their behavior as consumers usually it has been seen that the consumers of the North Gujarat may the following tendency nearly mediating two groups in purchasing this main factor has also been considered in choosing channel. 3. Distribution Channel:- Distribution means to distribute spread as disseminate in the field of marketing channel of distribution indicate routes or path way through which goods & service flow or from producers to consumers. Choice Laboratories has two type of selling system V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 1. Selling using companies sales force. 2. propa ganda selling. Choice Laboratories has selective company owned distribution network as presently has such own operations in nine states namely Gujarat, Rajasthan, U.P. etc. Media by which productProducers reach to the customer:- Dealer Depots Stockiest Dealers Retailer Stockiest V.M. PATEL INSTITUTE OF MANAGEMENT Consumers GANPAT UNIVERSITY Retailer Consumers 4. Motivation to Channel Members:- Motivation is the integral part of every management process. It can not be separate from the operation of channel management. According to a famous management thinkers “Each living persons need to motivated for getting our works done by him”. It clearly indicates that the members to the how persons need to be motivated. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY The more motivation provide by the company, more enthusiasm the spirit the selling on part of channel members. Every company has to perform various strict & device to attract and maintain the channel members and spirit them to sell more by their own willing understanding this. The psychology of marketing Choice Laboratories has number of motivation scheme implementation. They includes 1. Re planning expired goods before the expired dates 2. Offering longer credit period. 3. Arranging tour and picnic for channel members. 4. Appraising the highest sales volume earner of the year in the public. 5. Physical Transportation Fleet:- Choice Laboratories uses its own fleet for reaching into same close market in the North Gujarat V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY region, it includes own transportation likes trucks, delivery tempos, containers. It gains many stage for the company. 1. It save the cost high ring out side transport agencies. 2. It can have public exposer of its logo and vehicle so one kind advertising. 3. It ensure the quickly and timely delivery of goods in the market. 4. It facilitates the delivery of goods soon after the production. 5. It reduces the requirement of warehouses. 6. Warehouses:- V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY Warehousing decision is the last decision to be done in any kind of channel management. Company should have a sufficient number of warehouses in the different segments of its market like wise Choice Laboratories is also market in the nine states so accordingly it has to choose the coy nines of starting means warehousing in all this nine states the number of warehouses differs by the market size of the states. In tabular forms they can be represent as under :- STATE NO. OF WAREHOUSES Gujarat 1 Rajasthan 2 Hariyana 1 Himachal Pradesh 1 Jandic 2 U.P. 1 M.P. 1 West Bengal 1 ------- Total =10 V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY CONLUSION PART CONTENTS 1. Objectives of studies. 2. Suggestion. 3. Limitations of Study. 4. Conclusion. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 1. Objective Of Study:- ♦ To know about channel members involved in the distribution channel. ♦ To find out which kind of distribution channel is used by the company. ♦ To know of the same about competitors. ♦ To how know intensive companies distribution channel. ♦ To know about the market share of the company. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY 2. Suggestion:- ♦ Company should more concentrate on Domestic market so that the Company can cover more local market. ♦ Company should make best effort for the marketing in Gujarat so that the selling of the Choice Laboratories can be increased. ♦ Company should make its delivery fast to retailers because some retailers complaint about the slow delivery of the goods. ♦ The company should provide main margin to retailers because some retailers complaint that V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY they get very low margin on Choice Laboratories products than other products. ♦ The company has less market share in India than its competitors. It should try to improve his share. The company has verify its activity in both domestic and export market. So it can not on contract. ♦ Company should try to unit is market rather than diversify to get the advantage of large of economic. ♦ Company should try to increase its market in entire Gujarat where Colgate, Palmolive is the market leaders. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY ♦ The company should seek to find out the potential market spirit in the increase on the rural areas of the country rather than going out side to the state. 3. Limitation Of Study:- ♦ Time constraint is the main limiting factor because I have studied in company about its distribution channel only in 21 days. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY ♦ Lack of company operation by some of the channel members. ♦ Lack of statistical information due to company’s policy of secret. ♦ Due to my own limited knowledge I could not study in much deep. CONCLUSION Choice Laboratories is the pride of the Unjha. It is the single large exporting firm in whole Unjha region. When today’s need is going to be globalize. The Choice has very bright future in its expounding foreign market. It has set a record of wining best V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY exporter of the year. Always continuously for Three Years. V.M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY