PROCTER & GAMBLE

DISTRIBUTION CHANNEL
SYSTEM

By: Sarvesh Singh 2K16GA016

Kaif Ullah Khan 2K16GA017
Anushree 2K16GA018
Mukherjee Abhishek 2K16GA020
Sidhu
FLOW OF CONTENTS

 Introduction

 Channel Explanation
 Intensive and Extensive Distribution

 Vertical Marketing System

 Transportation

 Diagrammatic Presentation of Channel

 Conclusion
Introduction
 The company was established in 1837, by William Procter and James
Gamble

 Company headquartered in Cincinnati, Ohio

 Established in India in 1964

 Product includes Vicks, Ariel, Tide, Olay, Gillette, Ambipur,

Pampers, Pantene, Oral-B, Head & Shoulders, Wella and Duracell

 Operates under 3 entities Procter & Gamble Hygiene and Health Care
Limited and Gillette India Limited
Channel Explanation

 In India: General office in Mumbai and manufacturing facilities in

five areas (Baddi, Bhiwadi, Goa, Hyderabad, Bhopal).

 Globally they manufacture their own goods from many different

countries such as the US, Canada, China, Mexico, Australia and
more.
Typical Distribution of P&G Products
Manufacturer

Marketing Agents- State Wise

Retailer/Wholesaler/Distributors

Chemist Shop/ Retail Outlets/ Big Markets

Agents
 P&G products are distributed through a network of redistribution stockists RS)
(covering both urban and rural population).

 There are 35 C&FAs (Carrying and Forwarding Agents) in the country who feed
these redistribution stockists regularly.

 The general trade comprises grocery stores, chemists,

wholesale, kiosksand
general stores.

 The C&FA act as buffe stock‐points (at

company s to r
depot) ensure that
stock‐outs did not take place.
 The C&FA system has also
in resulted in cost savings of
terms
direct transportation and reduced
time lag in delivery.
Intensive Distribution
 P&G follows this strategy in India. As the company manufactures
FMCG convenience/necessity goods, hence there is lesser/no brand
loyalty from customer side.
 These products are typically purchased impulsively and frequently and
required to be widely available to customers.
 The distribution network of the company needs to be very strong and
proactive.
 As the products are relatively small and easily transported, they are
easy to box up a great number of units to many different channel
intermediaries
Extensive Distribution

 Sold in retail stores such as Walmart, Target, and other convenient

stores all over the world

 Company requires extensive distribution to obtain big sales volume

 The Procter and Gamble owns a series of distribution

centers in Texas, Ohio, and more
Vertical Marketing System

Corporate Vertical Marketing System: Wella Professionals have joined

with P&G and are exclusive distributors of their hair and skincare products.

They are only sold within their own stores.

 Transportatio
n
 Shipping: Their first mode of transportation is through shipping

Advantages: Provided large amounts of carrying capacity with low cost

Disadvantages: They are often effected by weather and seasonal delay which
may delay the shipping time.

 Truck wholesaling: Then the products move to truck fleets where P&G have a
contract with "Ryder logistics & Solution“.

Advantages: Trucks are relatively fast form of transportation

Disadvantages: Expensive way to transport so often they use double trucks

 Diagrammatic Presentation of Channel

PRODUCER
RETAILER CUSTOMERS
S

PRODUCER WHOLESELLER RETAILER CUSTOMERS

S
Conclusion
 The company uses its absolute control power to design more effective
distribution channels.

 It streamlines the number of distributors so that making the distributors is

more stable and competitive.

 P&G Company is investing in a more agile and faster distribution network

to optimize inventory and reduce out-of-stocks.

 It reasonably allocates resources across channel options.

 It is also investing in its sales force to more profitable

establish distribution system (Annual Report of P&G,
2016)
THANK YOU