ITC (Indian Tobacco Company )

Submitted to: Submitted by:

Arjun S. (20RM909)
Dr. Pankaj Priya
Kriti
Mehandru (20RM925)

Neerav Jain
 Introduction
ITC was incorporated on 24 August 1910 and headquartered in
Kolkata,WestBengal.
Company completed 100 years in 2010 and as of 2019–20, had an annual
turnover of US$10.74 billion and a market capitalization of US$35 billion
It employs over 36,500 people at more than 60 locations across India and is part
of the Forbes list.
The Company's multi-business portfolio encompasses a wide range of businesses
- Fast Moving Consumer Goods comprising Foods, Personal Care, Cigarettes
and Cigars, Branded Apparel, Education and Stationery Products etc.
 Channel Design
Multiple Channel Distribution System
ITC uses a combination of distribution channels according to the products,
demand and geography it is catering to.

Push Strategy
Used to increase sales, awareness and to gain relationship from kirana owners.
And it was basically implemented for cigarettes.

Pull Strategy
To induce the customer to buy the product through advertisement and
consumer protection and was used in the case of ’ Sunfeast Ready to eat Pasta’.
 Channel Levels
• ITC HAS ONE OF THE MOST EXTENSIVE DISTR IB UTION
NETWOR KS IN INDIA. ITS PR ODUC TS AR E AVAILAB LE AT
4.3 MILLION OF THE ESTIMATED EIGHT MILLION R ETAIL
STOR ES IN INDIA.

• M O D E L 1 – L A R G E C IT IE S , A R E A S W I T H H I G H D E M A N D .

Company C&F Wholesaler Retailer Consumer

• MODEL 2 – SMALL CITIES

Company C&F Retailer Consumer
Documents regarding flow of
Information
Opening stock : The distributor takes the order every week whereas the retailers take the order after every two
week. At the point of delivery distributors need to pay cash and collect stock, no credit is given on cigarettes. 
Received stock: It is the stock which each distributor obtains at the beginning of the week from the warehouse
(Area manager) and further distributes it to the wholesalers (maximum 1 month credit) and hawkers (1 day
credit). 
Sale of the stock: This includes the total sale done by the distributors and the retailers from the stock in a week. 
Damaged stock: Cigarettes have a shelf life of 3-6 month. All damaged or unsold stock is bought by the
company and sent to the factories where the tobacco is extracted, processed and new cigarettes are produced. 
Closing stock: The stock which is left at the end of the week
Management of Field Force
Monetary Method of Rewarding: As per the HR policy of ITC Ltd the field force is monetarily rewarded on
the basis of the number of bills drawn on the distributors. 

Non-Monetary Method of Rewarding: The field force of ITC Ltd is given unlimited medical benefits in terms
of non-monetary methods of rewarding.

Target setting Mechanism: The field force is given targets in terms of the number of bills generated by an
individual.

Monitoring Mechanism : The members of the field force reports to their immediate supervisor and this follows
throughout the hierarchy.

Training and HR Inputs: The salesmen of the distributors are under the payroll of ITC ltd. Incase of mass
recruitment the new sales force is given training by the HR department of ITC Ltd. As per the HR norms, ITC
Ltd provides training to its own employees of the distribution network at regular intervals.
Transportation and Logistics
Third party owned trucks are used to transport the cigarettes from the production plant to the company
depot/warehouse.

Similarly, third party owned trucks are also used to transport the goods from the warehouse to the
distributors. All these transportation costs are borne by the company.

From the distributors place, the cigarettes are distributed to the wholesalers & the retailers (panwalas)
through the user delivery vans, rickshaw, cycles, motorcycles, autos. All these transportation costs are borne
by the distributor.

ITC Cigarettes have consolidated their inventory by deploying SAP module of Information technology in
their warehouses. The stock positions are automatically updated in the database as & when goods are sold
from the warehouse.

Replenishment orders are generated to the company when the stock level goes below the benchmark level
which takes into account the order lead time as well.
 Packaging

Cigarette
“Tukda” “Carton”
Pack

• One carton contains around 10000+

cigarette

• Quantity in “TUKDA” is around 10-20

THANKYOU