Group: RODAGE POOJA, GHOLAK HRUSHIKESH, KAWADE ANIKET, GUJARATHI SIDDHI

A
CASE STUDY ON
“A STUDY ON SALES AND DISTRIBUTION CHANNEL
MANAGEMENT OF PARLE”
SUBIMITTED TO
DR. RITESH K. PATEL
(COURSE INSTRUCTOR)
SALES & DISTRIBUTION MANAGEMENT
COURSE CODE 306
(CIA-II)

SUBMITTED BY
1. RODAGE POOJA SANTOSH
PRN NO: PMB21F1103
2. GHOLAK HRUHIKESH NARAYAN
PRN NO: PMB21M1036
3. KAWADE ANIKET MAHESH
PRN NO: PMB21M1070
4. GUJARATHI SIDDHI SUNIL
PRN NO: PMB21F1042

THROUGH

S.R.E.S SANJIVANI COLLEGE OF ENGINEERING

DEPT.OF MBA, KOPARGAON (MH.)

BATCH: 2021-2023

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TITLE OF COMPANY

PARLE

INTRODUCTION TO COMPANY
PARLE: World’s largest selling biscuit

Parle Products has been India’s largest manufacturer of biscuits and confectionery for almost 80
years.

In 1929, a small company by the name of Parle products emerged in British dominated India. The intent
was to spread cheer and joy to children and adults all over the country with its sweets and candies. The
company knew that it wouldn’t be an easy task, but they decided to take the brave step. A small factory
was set up in the suburbs of Mumbai, to manufacture sweets and candies. A decade later it was upgraded
to manufacture biscuits as well. Since then, the Parle name has grown in all directions, won international
fame and has been sweetening people's lives all over India and abroad. Many of the Parle products - biscuits
or confectioneries, are market leaders in their category and have won acclaim at the Monde Selection, since
1971. With Parle-G being the dominant player with over 12% market share in the ₨ 25,000 crores domestic
biscuit market and a 15% share of the total confectionary market in India, Parle has grown to become a
multi-million dollar company. While to consumers, it's a beacon of faith and trust, competitors look upon
Parle as an example of marketing brilliance.

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PARLE PRODUCTS

BISCUITS
PARLE-G HIDE & SEEK
KRACKJACK MONACO
MILANO MILK SHAKTI
MAGIX CRÈME TOP SPIN
20-20 DIGESTIVE MARIE
CONFECTIONARY
MANGO BITE MELODY
MAZELO KISMI
ORANGLE BITE LONDONDERRY
SNACKS
SALTED PEANUTS KHATTA MEETHA
BHUJIA SEV FULLTOSS
PARLE'S WAFERS MEXITOS

PARLE BISCUITS
Parle biscuits are linked to factors of power and wisdom providing nutrition and strength. They are indeed
much more than a tea-time snack, as many consider them to be an important part of their daily food. Parle
provides everyone with a basket of biscuits which is not only satisfying but are also of good and reliable
quality. They cater to all tastes from kids to senior citizens. They have found their way into the Indian hearts
and homes. Parle G is a source of strength for both body and mind due to the sumptuous amount of milk
and wheat. It is the Largest selling Biscuit Brand in the world.

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Biscuits are estimated to enjoy around 37% share by volume and 75% by value of the bakery industry. The
organized sector caters to the medium and premium segments, which are relatively less price-sensitive. The
organized sector is unable to compete at the lower price range due to the excise advantage enjoyed by the
informal sector. The biscuit industry in India comprises of organized and unorganized sectors. The FBMI
represents the organized biscuit industry consisting of small scale, medium and large biscuit manufacturers
located in all zones and all states of the country. The biscuit industry has been experiencing steady growth
of 14-15% annually. In 2008, the growth exceeded 16% mark on account of exemption from Central Excise
Duty on biscuits. The Industry estimates project a 17+% growth of the industry. The sentiments are sedate
in lieu of the economic downturn that has hit the entire country.

QUALITY OF PARLE
Hygiene is the core aspect to every process at Parle. From husking the wheat and melting the sugar to
delivering the final products to the supermarkets and store shelves nationwide, care is taken at every step
to ensure the best product of long-lasting freshness. Every batch of biscuits and confectioneries are
thoroughly checked by expert staff, using the most modern equipment hence ensuring the same perfect
quality across the nation and abroad. The factories at Bahadurgarh in Haryana and Neemrana in Rajasthan
are the largest biscuit and confectionery plants in the country. The factory in Mumbai was the first to be set
up, followed soon by the one in Bangalore, Karnataka. Parle Products also has 14 manufacturing
units for biscuits and 5 manufacturing units for confectioneries, on contract. All these factories are located
at strategic locations, to ensure a constant output & easy distribution. Each factory has state-of-the-art
machinery with automatic printing & packaging facilities.

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SALES OF ORGANIZATION
There are five mother units and thirty-one contract manufacturing units in India. The main difference
between mother units and contact units is that mother units produce more than one product that is PARLE
G, MONACO, KRACK JACK, SIXER, and HIDE AND SEEK etc. while contact unit manufacture only
Parle-G. Mother units are as follows:
 Mumbai (Maharashtra)
 Bahadurgarh (Haryana)
 Neemrana (Rajasthan)
 Bangalore and Kolkata

IMPORTANT PEOPLE OF THE COMPANY

 CHAIRPERSON: MR. VIJAY CHAUVAN
 DIRECTOR: MR. ANUP CHAUVAN
 EXECUTIVE DIRECTOR: MR. AJAY CHAUVAN
 COMMERCIAL MANAGER: MR. AMOL
 FACTORY MANAGER: MR. NIVATIA
 PRODUCTION MANAGER: MR. RAJESH RAUL
 STORE MANAGER: MR. DIXIT
The key responsibilities of a Sales Manager at Parle are as follows:
 Estimating, Forecasting and tracking of sales & revenue numbers.
 Develop and manage relationships with Emerging Affluent clients provide investment products and
services in line with their financial needs & objectives.
 Meet the Revenue targets for self and assigned team.
 Proposing Asset allocation/Portfolio maintenance/Review of portfolio.
 Manage a team of Premier Wealth Managers who interact with clients.
 Manage the distribution of leads/resources to the team to ensure optimum manpower utilization &
plan sales activity.
 Have sales hurdle with the team & make sure a continuous interaction is carried among the team
members & solve all related problems of the Premier Wealth Managers.
 Ensure regrettable attrition is under control.
 Coach & train Premier Wealth Managers on all products.

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SALES FORCE EVALUATION

The criteria for Sales Force Evaluation are as follows:
a) Qualitative Methods
 Personal Observation
 Merit Rating
 Customer Opinion of salesmen
b) Quantitative Methods
 Analysis of Sales record & reports
 Comparison of salesman’s performance with quota
 Ratio Analysis (selling cost to sales)
 New customers obtained

DISTRIBUTION NETWORK OF PARLE-G

Parle uses Intensive Distribution for Parle G. This is the ideal strategy for the market leader as intensive
distribution has the following advantages:
 Increases coverage and sales
 Increases product availability
 Encourages retailers to compete aggressive
The Parle distribution network for biscuits has essentially four levels as enlisted below:
 Parle Depots
 Wholesalers and Distributers
 Carry Forward Agents (if required)
 Retailers
Parle has level 1, level 2, level 3 distribution channels levels:
Level 1:
 Availability of Parle G biscuits at all departmental stores across the length and breadth of the
country.
Level 2:
 Since it's an FMCG product this channel exists for customers scattered throughout the country.
Level 3:
 Mass consumption and suitable for National and International coverage. For e.g. Parle's
international operations consist of serving markets in the Middle East, Africa, South America, Sri
Lanka, Australia and North America for which the 3-level distribution channel exists.

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DISTRIBUTION NETWORK LOGISTICS

Parle takes into consideration a host of factors while selecting the channel members. This is because it
believes that selection of channel members is a long run decision and the rest of the decision regarding the
supply chain depends upon the efficiency and coverage by the channel members. The following are the host
of factors considered by the company in selecting the channel members:
 Authentication is required by the regarding the identity of the channel members, which includes the
name and address, photograph of the location.
 Proof of solvency which requires name and address of the channel member’s bankers
 Safety of the inventory, which means that the distributor/ dealer should get the stock of the company
insured.
 Inventory or the perishable goods kept by the distributor/ dealer should be in good condition which
means a detail of storage space and Refrigeration facility is to be provided.
 Company acknowledges the fact that it needs to be sensitive to the market demands. For this it
requires that a number of salesmen needs to be present on the field.
 The salesmen too are divided into various categories like
a) The Field salesmen
b) Counter salesmen
 The details of Clerical Staff and labor are to be provided. The technical competence of the salesmen
needs to be mentioned.
 Dealers of the company must carry a good reputation. This is due to the fact that Parle believes that
the reputation of the dealer affects the clientele in the long run.
 Market coverage by the distributors needs to be defined which includes details of Geographic
coverage and Outlets per market area.

THE CHANNEL MEMBERS OF THE PARLE DISTRIBUTION

NETWORK
a) Distributors
 One of the main factors, which keep the distributors motivated, is the margin. Usually the margins
offered by Parle are 8%. Now-a-days it has been raised to 8.5%.
 Volume wise this comes out to be a big figure since Parle’s product has a good demand in the
market. However, compared to the other companies the margins are still lower since the new players
in the market offer a much higher margin. Also, the company is organizing various Total Quality
Management initiatives and workshops. Here, various counseling measures are undertaken by the
company to improve the overall working of the distribution network.

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b) Retailers
 Trade schemes: these are undertaken by the company only for hard selling items e.g. Biscuits and
Snacks etc. for these the company raises the margins by 2%, also schemes like good packaging in
case of butter and cheese is undertaken by the company. However, this is only a short-term initiative
to push the products of the company.
 Glow boards: the company puts up glow boards at the retailer and pays the major portion of the
cost.
 Schedule of the salesmen: they provide the retails with this schedule so the retailers can pre-
estimate the quantities of the various products needed.
 Infrastructure facilitation: the company facilitates the retailers to buy beautiful stalls by
formulating an easy payment program and a commitment to buy back the equipment at a reasonable
price when the value of the equipment has depreciated.

EVALUATION OF CHANNEL MEMBERS

Parle has a three-pronged process to evaluate its channel members. These are the Beat Plan, the Cumulative
Performance Plan and Target versus Achievement Plan.
 Beat plan: this plan is generated for the various product categories. A weekly schedule is prepared
for various markets and the retailers the turnover for each of the product is calculated for the
wholesale dealers.
 Cumulative performance: the performance of the dealers is averaged out over a period of three
years where a comparison is made of the present performance vis-à-vis the previous ones.
 Target versus achievement: the performance and the targets are compared and therefore the gaps
are identified which help in evaluating the wholesalers and the distributors and planning for the
next year as well. This is done for each of the product category.
 Other Criteria: These need to be fulfilled by the channel members of Parle:
a) Details of the bank guaranty
b) Photographs of the offices
c) The storage space
d) Details of the delivery vehicle with photograph
e) Summary of the monthly potential sales of markets
f) Summary of the product wise monthly sales potential of institutions

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CONFLICTS AMONG CHANNEL MEMBERS

 Ownership of assets: Previously the company used to give the products on lease to the retailers,
when the company wanted the stuff back; the retailer disagreed to comply and created issues of
ownership.
 Stocking issues: The Company does not want the retailers to stock the competing brand in the
company leased stall, which at times is hard to manage as retailers tend to do it often.
 Replacement of products: The deterioration in the product calls for fail in replacement by the
company this major issue of vertical conflict.
 Credit policy: Compared to the market, the company’s credit period is less that especially in case
of institutional sales is very important.
 Packaging: The channel members for easy storing demand a better quality of packaging.
 Replenishment: The replenishment of the stocks is not prompt in case of Parle cheese Biscuit and
all hard-selling items.
 Margins: The Company provides least margins to all the channel members. For e.g. the retailer’s
margin in case of Parle G is 8% as compared to Britannia’s 12%.

CONCLUSION
 The company’s strength is in the procurement of raw materials and essentially not the distribution
of its product. Even though Parle is the market leader in biscuits. But, distribution logistics is the
industry’s main problem. While the other companies fail to replenish demand due to lack in
procurement of raw material, Parle’s inventory management is sound.
 Parle has loyal cooperatives that provide products only to them, over time the relationship of trust
has built up with these people that Parle leverages now.
 The transport channel is another strong point for Parle. As these transporters have grown with the
company overtime; the bonding with them enables the company to give least margins when it comes
to the distributors in the industry, lowering the costs.
 Parle believes that there is an ongoing demand in the market and therefore no promotions are needed
to increase the sales, also the fact this would affect the cost of the product the company does not
undertake many promotion schemes.
 Parle is able to provide products at the least price in the industry, and is able to give least channel
margins as the channel members earn through volumes and not through high margins.
 The Company has been able to push its new products into the market by hooking them onto the fast-
moving products like Parle butter bite.

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 Because of the strong relationship that Parle shares with the constituent channel members, it forces
the channel members to carry all its new products.

SUGGESTIONS
Parle should go in for ‘Parle Zones’.
It is primarily for big city retail outlets. Here all the Parle products can be stalked. This can be an effective
mode of “umbrella marketing. This strategy can be implemented ‟ in regions where the footfalls are large
in number.
The advantages of this alternative channel would be as follows:
 Full range display
 Easier to promote new products
 Easy to push impulse purchase products
 The Parle Brand building exercise will be enhanced.

REFERENCES
 "Parle-G world's No 1 selling biscuit: Nielsen". Economic Times. 2011-03-03. Retrieved 2011-10-
12
 The Chronicles of Parle-G by Shephali Bhatt. ET Bureau, 30th Oct 2013
 Parle G Case Study. StudyMode.com. Retrieved 03, 2011, from
http://www.studymode.com/essays/Parle-g-Case-Study-619098.html
 http://info.objectivemanagement.com/page/Sales-Force-Evaluation.aspx
 https://www.scribd.com/doc/40190273/Parle-G-Sales-and-Distribution
 http://economictimes.indiatimes.com/industry/cons-products/fmcg/biscuit-market-facestough-
competition-in-india-with-rising-cookie-segment/articleshow/52684857.cms
 Parle-G: The journey of a biscuit for masses Retrieved 04, 2011, from
http://economictimes.indiatimes.com/slideshows/advertising-marketing/parle-gthejourney-of-a-
biscuit-for-masses/numbo-jumbo/slideshow/24922125.cms

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