Sales Report

IIPM
SALES & DISTRIBUTION MANAGEMENT PROJECT
SALES AND DISTRIBUTION PROJECT Sales (Pre & Post) & Distribution effectiveness:
A comparative study of DAIICHI SANKYO & ABBOTT LABORATORIES PREPARED BY Name Pradipna lodh Ranu Parmar Yogendar singh tomar Madhumita Tripathi Rishab Goel Section Group No. F-41 Signature
IIPM IIPM TOWER,SATBARI, CHANDANHAULA,CHATTARPUR-BHATIMINESROAD NEW DELHI
EXECUTIVE SUMMARY
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1 PHARMACEUTICAL
SECTOR- ABBOTT& DAIICHII
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This project aims to study the distribution channels, sales network and service patterns of the pharmaceutical sector through an analytical and comparative study of two leading companiesDAIICHI SANKYO and Abbott Laboratories . The project also tries to bring out the shortcomings, if any, in the present system and thus recommends suggestions to improve the same. The project also gives insights into the various financial terms, norms of the sales and service departments as per the guidelines of the pharmaceutical industry. The project was designed after detailed discussion with the company officials on three parameters i.e. distribution network, service network and sales functioning. The project also includes the insights given by the dealers and officials of the company. The sample size of 15 for channel members and that for the sales people was 2, for each company. Firstly, the project discusses the distribution network of the two companies and the functions carried out by the channel members. ABBOTT being the largest pharmaceutical manufacturer in India definitely has a wider reach and more number of dealers than . The project also covers the financial terms of the company with the dealers and that of the dealers with the customers. Secondly, the project discusses the sales functioning of the two companies, which includes aspects such as the hierarchy of the sales department prevalent in the company; the responsibilities and functions of the sales force, their performance appraisal structure etc. Finally the project covers the service network of the two companies which deals with the after sale services and their effectiveness provided by both the companies and various complaints and queries are handled by them.
ACKNOWLEDGEMENTS
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We are very thankful to the entire dealer, service, and sales network of DAIICHIand Abbott Laboratories for their cooperation, without which completion of this project would not have been possible.
CONTENTS
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1. Executive Summary 2. Acknowledgement 3. Methodology 4. Indian Pharmaceutical Market 5. Company Background(Abbott PHARMACEUTICAL S) 6. Distribution Network 7. Selection of Dealers 8. Service Network 9. Company Background(DAIICHII PHARMACEUTICAL S) 10. Distribution Network 11. Selection Of Dealers 12. Service Network 13. Analysis 14. Recommendations 15. Annexure
2 3 5 7 12 13 15 23 25 27 27 31 39 40 43
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METHODOLOGY
The objective of this project on sales and distribution is to do an analytical and comparative study of the sales, service and distribution function of two players from the chosen business sector. The business sector chosen for this purpose is the fast growing pharmaceutical sector, and the players chosen for study from this sector are: DAIICHI SANKYO ABBOTT LABORATORIES
INFORMATION SOURCES
PRIMARY DATA SOURCES DAIICHII INDIA LIMITED- Head, Corporate Sales DAIICHII AUTHORISED DEALERS ABBOTT LABORATORIES Area Sales Manager ABBOTTAUTHORISED DEALERS SECONDARY DATA SOURCESTHE INTERNET www.DAIICHII.com www.abbott pharmaceutical s.com www.google.com www.askjeeves.com www.indiainfoline.com
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DATA COLLECTION TOOLS

Interviews & Discussions with the company officials, dealers and Sales people. Questionnaires were used to record data.
SAMPLE SIZE USED

The sample size for the dealers was 10 in number while the sample size for sales people was 4. ABBOTT(dealers) - 8 ABBOTT(sales people) 1 DAIICHII India (dealers) 10 DAIICHII India (sales people) 1
LIMITATIONS:
It was difficult to ask for time required for a detailed discussion on the questionnaire & therefore several aspects of the questionnaire were answered briefly. The company officials did not divulge details about competitive sales policies, strategies & certain financial terms with dealers as they find it to be a confidential piece of information of the company.
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Indian Pharmaceutical Market

The Indian pharmaceutical industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this subcontinent. (Richard Gerster) The Indian pharmaceutical industry in recent years has grown in stature from an industry that copies patent drugs and manufactures them cheAbbotty. Its now counted among the industries that are fueling Indias economic growth and holds vast potential. India-based pharmaceutical companies are also predicted to gain considerable market share in the world by the end of this decade. The industry is estimated to have generated revenue worth US$13.1 billion in FY 2011, according to a new Research and Markets report, Indian Pharma Sector Forecast 2014. India-based companies fulfill around 70 percent of the countrys demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, orals and injectibles. Development economist, Richard Gerster, said that the Indian pharmaceutical industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this sub-continent. The Indian pharmaceutical sector has come a long way, being almost non-existent before 1970 to a prominent provider of healthcare products, meeting almost 95 per cent of the country's pharmaceuticals needs. The Industry today is in the front rank of Indias science-based industries with wide ranging capabilities in the complex field of drug manufacture and technology. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously. Playing a key role in promoting and sustaining development in the vital field of medicines, Indian Pharma Industry boasts of quality producers and many units approved by
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regulatory authorities in USA and UK. International companies associated with this sector have stimulated, assisted and spearheaded this dynamic development in the past 53 years and helped to put India on the pharmaceutical map of the world. The Indian Pharmaceutical sector is highly fragmented with more than 20,000 registered units with severe price competition and government price control. It has expanded drastically in the last two decades. There are about 250 large units that control 70 per cent of the market with market leader holding nearly 7 per cent of the market share and about 8000 Small Scale Units together which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units). These units produce the complete range of pharmaceutical formulations, i.e., medicines ready for consumption by patients and about 350 bulk drugs, i.e., chemicals having therapeutic value and used for production of pharmaceutical formulations. Following the de-licensing of the pharmaceutical industry, industrial licensing for most of the drugs and pharmaceutical products has been done away with. Manufacturers are free to produce any drug duly approved by the Drug Control Authority. Technologically strong and totally selfreliant, the pharmaceutical industry in India has low costs of production, low R&D costs, innovative scientific manpower, strength of national laboratories and an increasing balance of trade. Corporate Catalyst India Indias Pharmaceutical Industry The total Indian production constitutes about 13 per cent of the world market in value terms and, 8 per cent in volume terms. The per capita consumption of drugs in India, stands at US$3, is amongst the lowest in the world, as compared to Japan- US$412, Germany- US$222 and USA- US$191. Current Status. India's US$ 9.4 billion pharmaceutical industry is growing at the rate of 14 percent per year. It is one of the largest and most advanced among the developing countries. The Indian pharmaceutical industry can reach a market size of US$ 11.6 billion by 2009.
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A beginning has been made with the signing of General Agreement on Tariffs and Trade in January 2005 with which India began recognizing global patents. Soon after, the Indian pharmacy market became a sought after destination for foreign players. Foreign direct investment into the countrys pharmacy industry touched US$ 172 million during 2005-06 having grown at a CAGR of 62.6 per cent during the period beginning 2002-06. The sector recorded strong growth in the second quarter ended September 2006, driven by launch of new generic drugs with 180 days exclusivity period in the US market. The top ten pharmacy companies reported an impressive 57 per cent growth in consolidated net profit at US$ 314.3 million, as against US$ 200.7 million in the same quarter of the previous year, while consolidated net sales were up 51 per cent at US$ 1.7 billion.
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Provision to boost demand The plan would have increased the demand for prescription drugs in two ways. First it would have created have a universal entitlement to a comprehensives package of health benefits thatincluded coverage of outpatient prescription drugs. Second it would have added an outpatient prescription drug benift to medicare which is the primary soure of health insurance for American 65 and older The Changing Prescription As per WTO, from the year 2005, India granted product patent recognition to all new chemical entities (NCEs) i.e., bulk drugs developed then onwards. This introduction of product patent regime from January 2005 is leading into long-term growth for the future which mandated patent protection on both products and processes for a period of 20 years. Under this new law, India will be forced to recognize not only new patents but also any patents filed after January 1, 1995. Under changed environment, the industry is being forced to adapt its business model to recent changes in the operating environment.Corporate Catalyst India Indias Pharmaceutical Industry Indian pharmaceutical industry is mounting up the value chain. From being a pure reverse engineering industry focused on the domestic market, the industry is moving towards basic research driven, export oriented global presence, providing wide range of value added quality products and services, innovation, product life cycle management and enlarging their market
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reach. The old and mature categories like anti-infectives, vitamins, analgesics are de-growing while, new lifestyle categories like Cardiovascular, Central Nervous System (CNS), Anti Diabetic are expanding at double-digit growth rates. The Indian companies are putting their act together to tap the generic drugs markets in the regulated high margin markets of the developed countries. The US market remains to be the most lucrative market for the Indian companies led by its market size and the intensity of blockbuster drugs going off patent. An estimated US$45 billion of drugs expected to go off patent by 2007 in US alone. The Indian pharmaceutical industry is also getting increasingly U.S. FDI compliant to harness the growth opportunities in areas of contract manufacturing and research. Indian companies such as Ranbaxy, Sun Pharma, and Dr. Reddy's are increasingly focusing on tapping the U.S. generic market. Outsourcing in the fields of R&D and manufacturing is the next best event in the pharmaceutical industry. Spiraling cost, expiring patents, low R&D cost and market dynamics are driving the MNCs to outsource both manufacturing and research activities. India with its apt chemistry skills and low cost advantages, both in research and manufacturing coupled with skilled manpower will attract a lot of business in the days to come. The Indian Government's decision to allow 100 percent foreign direct investment into the drugs and pharmaceutical industry is expected to aid the growth of contract research in the country. MNCs in India is facing the problem of having a very high Drugs Price Control Order (DPCO) coverage, weakening their bottom lines as well as hindering their growth through the launch of new products. DPCO coverage is expected to be diluted further in the near future benefiting the MNCs.
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COMPANY BACKGROUND Abbott Laboratories

Abbott Laboratories is an American-based global, diversified (multi-division) pharmaceuticals and health care products company. It has 90,000 employees and operates in over 130 countries.. The company headquarters are in Abbott Park, North Chicago, Illinois. The company was founded by Chicago physician Dr. Wallace Calvin Abbott in 1888. In 2010, Abbott had over $35 billion in revenue. In 1985, the company developed the first HIV blood screening test. The company's drug portfolio includes HUMIRA a drug for rheumatoid arthritis, psoriatic arthritis, ankylosing spondylitis , Crohn's disease, moderate to severe chronic psoriasis and juvenile idiopathic arthritis; Norvir, a treatment for HIV;Depakote, an anticonvulsant drug; and Synthroid, a synthetic thyroid hormone. Abbott also has a broad range of medical devices, diagnostics andimmunoassay products as well as nutritional products, including Ensure, a line of well known meal replacement shakes, and EAS, the largest producer of performance based nutritional supplements. Abbott's in vitro diagnostics business is a world leader in immunoassays and blood screening. Abbott's broad range of medical tests and diagnostic instrument systems are used worldwide by hospitals, laboratories, blood banks, and physician offices to diagnose and monitor diseases such as HIV, hepatitis, cancer, heart failure and metabolic disorders, as well as assess other important indicators of general health.
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Abbott Point-of-Care manufactures diagnostic products for blood analysis to provide health care professionals critical diagnostics information accurately and immediately at the point of patient care. Abbott also provides point-of-care cardiac assays to the emergency room. In 2011, the company was ranked as Top 20 BioPharma employers by the Science Magazine. The company has been on the list for 8 times
Distribution network
Channel structure, members and their selection The reach of the channel structure of pharmacy is all over world . The channel structure is very simple and effective. Complications are kept out in order to make the overall process very effective and efficient.
Channel structure
ABBOTT Laboratories
Company Warehouse Dealer/ distributor Warehouse Dealer shops(chemist) End customer
Product Our diverse family of pharmaceutical, medical, and nutritional products includes a broad range of specialized medicines; medical diagnostic instruments and tests; minimally invasive surgical devices; a spectrum of nutritional supplements for infants, children and adults; and products for veterinary care. The links below offer a few ways to browse through our product offerings. Many of the trademark names link to product Web sites, which contain more detailed information.
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Products by Category
Pharmaceutical Products Nutritional Products Diagnostic Instruments & Tests Medical & Surgical Devices Animal Health Vision Technologies
List of Products
Alitra Q AlphaTRAK Aluvia Avonex FoxCross .035 PTA Catheter FreeStyle MULTI-LINK Myoplex
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Selection of dealers
ABBOTT follows a strict policy in selection of the dealers, since dealers are the first impression a customer has about the company and therefore it is necessary to fulfill the following pre- requisites to be eligible to become a dealer: 1) The dealer should have a sound financial background. The financial capability of a dealer is solely depended on the discretion of the company officials. 2) The dealers current business goodwill, measured in terms of dealer goodwill which covers areas such as infrastructure, manpower etc. and individual goodwill i.e. the persons educational qualification, social status etc. 3) The dealer should have his own infrastructure and logistics, since he is completely responsible for the inventory and transportation of the goods to the shop from his warehouse.
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Responsibilities and Functions of the dealers
ABBOTT believes in Customer Loyalty and thus ABBOTT expects that their dealers apart from selling pharmaceutical relations management: 1) Sales promotion through regular promotional schemes, road shows, campaigns etc. the expenses incurred by the dealers is shared by the company only if these activities are for promotion of the company and not of the dealer. 2) Recruitment- done under the guidance of certain ABBOTT officials 3) Training and development of manpower with company assistance 4) Servicing according to the size of orders 5) Customer relation management 6) Promote other products of the company The dealer should be in regular touch with the customer, keep taking his feedback and ensure maximum customer satisfaction. The dealer should also try and convince the customer to try newer products of the company. The dealer has to thus cater to 3 major areas:
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products should perform the following functions for better customer
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Pre sale Selling Post sale services SALES KIT: A dealer should carry the following in his sales kit: All products leaflets (adequate quantities) List of prospects with their addresses Information about the competition in the market Price list of ABBOTT products and corresponding prices of competitor products Shade cards
Financial terms The various modes of payment through which the dealer pays for the products, he has to receive are: 1) Cash/ cheques/ DD 2) Credit cards 3) Letter of credit
Margins The dealers collect their margins at the time of sale of the product. The margin varies according to the type of the product.
Performance Appraisal For the dealersABBOTT appoints HR managers with various dealers, who are responsible to layout, the companys guidelines which the dealers are supposed to follow. Dealers have a company appointed business development manager to advise them from time to time.
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The company through calculation of the Sales Satisfaction Index conducts the performance appraisal for dealers. ABBOTT. maintains a Balance Scorecard for each dealer, in which benchmarks are listed regarding certain aspects such as shops, infrastructure, sales promotion, qualifications and eligibility criteria of the staff recruited. These appraisals are conducted yearly and on the basis of these results certain monetary incentives are provided to the dealers. The dealership of any dealer can be cancelled for violation of company norms.
The order processing system is as follows: Walk in Demand Customer requirement Quotation Payment Delivery
ABBOTThas invested huge sums of money to implement and maintain state of the art materials, inventory and stock to their correct levels in the whole process of production and right up to the level of the point of sale. With the implementation in i2 technologies from the USA the companys capabilities to manage the supply chain has become very efficient and effective. The overall work processes and the business units interact with each other to balance the processes and
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integrate all the business units into one consolidated unit with the help of the use of a popular enterprise resource planning software called S.A.P. RESPONSIBILITIES OF A SALES PERSON PRE-SALES Cold calling prospect generation Creation of customer card Generation of prospect base Update knowledge of companys products and its competitors Update knowledge of the companys new business and products Update knowledge about the entire product line and accessories Update knowledge about warranty and service
SALES RELATED Visit the prospect Understand his needs and create interest Give an appropriate solution Give demo and offer test drive Handle objections Follow up with the prospect Secure order
DELIVERY Help customers in: Knowledge about warranty (very specific in pharmaceutical industry- only manufacturing defects) Knowledge about service requirement 20PHARMACEUTICAL
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Complete demonstration if required in big/ bulk orders Suggest accessories
POST DELIVERY Help customers in: On time service Proactive problem solving
RELATIONSHIP MANAGEMENT Keeping in touch with the customers Wishing channel members (B2B) on special days Proactive feedback
PERFORMANCE APPRAISAL OF SALES PERSON The company according to the CUSTOMER SATISFACTION INDEX monitors the performance of a sales person qualitatively and quantitatively. The incentives given to the salesperson varies according to the price of the product he successfully sells. This report is then used by the company to further decide the incentives to be given. The company also provides training and development to the sales force, which is done either by the company or by a third party consulting firm.
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FEEDBACK FROM CUSTOMERS

Customer feedback is obtained not only after servicing as mentioned earlier, but post sales too. There are 2 types of feedback forms customers can fill: 1) Direct feedback to the sales people. 2) A feedback to company through questionnaires and cards All these feedback cards are sent to the corporate office of the company where the required action is taken.
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Market Research: The company undertakes Market Research activity to measure its performance in different fields, like after sales service, customer satisfaction etc. It also follows SSI and Customer Satisfaction Index (CSI) study to measure its performance. SSI (Sales Satisfaction Index) The J.D. Power SSI Study is a consumer-driven measure of customer satisfaction with the product sales and delivery process. According to the study, there are six major factors impacting satisfaction with the dealership at the time of purchase. They are Sales Experience, Explanation at Delivery, Price Evaluation, Delivery Timing, Salesperson Knowledge and Post-Delivery Contact. CSI (Customer Satisfaction Index) The CSI study examines customer satisfaction with quality delivery and dealer service at 12-18 months of ownership. CSI performance factors are problems experienced, service advisor, service performance, service timing and facility appearance.
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Service Network
Structure:
Group Head
Service Support
Field Support On the job Training
Backend
T&D
Dealer
Development
CRM
Day to day activities Warranty
ABBOTT Closely monitors each and every aspect of the organisatisation and ensures that each factor contributing to its organisations growth is monitored
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DAIICHII
Daiichi Sankyo Co., Ltd is a global pharmaceutical company and the second largest pharmaceutical company in Japan. It achieved JPY 970 billion in revenue in 2010 and is currently ranked number 17 in world sales. Its headquarter is based in Tokyo. The company also owns the American biotechnology company Plexxikon, the German biotechnology company U3 and Ranbaxy Laboratories in India. Daiichi Sankyo is the producer of Benicar (Olmesartan), an angiotensin II receptor antagonist and top selling drug in the U.S. with total sales of USD 2.7 billion. Daiichi Sankyo, Inc. (DSI) began operating in the U.S. in 2006. It is the U.S. subsidiary of Daiichi Sankyo, Co., Ltd. and a member of the Daiichi Sankyo Group. The organization, which includes U.S. commercial operations and global clinical development (Daiichi Sankyo Pharma Development), is headquartered in New Jersey. Daiichi Sankyo Europe, GmbH (DSE), the European subsidiary, is headquartered in Munich, Germany. The organization is responsible for development and manufacturing for 12 European countries. Daiichi Sankyo Co., Ltd. is a full member of the European Federation of Pharmaceutical Industries and Associations (EFPIA) and of the International Federation of Pharmaceutical Manufacturers and Associations (IFPMA). In 2009, the highly respected magazine R&D Direction honoured Daiichi Sankyo with its "Best Cardiovascular Pipeline Award". Daiichi Sankyo was established in 2005 through the merger of Sankyo Co., Ltd. and Daiichi Pharmaceutical Co., Ltd. which were century-old pharmaceutical companies based in Japan.
Acquisitions
In 2006, Daiichi Sankyo acquired Zepharma, the OTC drugs unit of Astellas Pharma. On June 10, 2008, Daiichi Sankyo agreed to take a majority (35%) stake in Indian generic drug maker Ranbaxy, with a deal valued at about $4.6 billion. In June 2008, Daiichi Sankyo acquired U3 Pharma, which would contribute a therapeutic antiHER3 antibody to the company's anticancer portfolio. On April 4, 2011 Daiichi Sankyo completed the acquisition of Plexxikon, a Berkeley CA-based pharmaceutical start-up company for $805 Million and an additional $130 Million in milestone payments, pending on the success of Vemurafenib (Plexxikons lead program) an oral, novel drug that targets the oncogenic BRAF mutation present in about half of melanoma cancers and about eight percent of all solid tumors. Daiichi Sankyo is retaining US co-promotion right of the (GSK licensed) drug.
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PRODUCT OF DAIICHI SANKYO

Sankyo
Benicar (olmesartan medoxomil) Mevalotin (pravastatin) Loxonin (loxoprofen) Hirudoid Olmetec (olmesartan) Captopril WelChol (colesevelam HC) Effient (Prasugrel) (co-marketed with Eli Lilly and Company) win bp piramal (olmesartan medoxomil) Panipenem
Daiichi Pharmaceutical
Cravit (levofloxacin) Evoxac (cevimeline) FloxinOtic (ofloxacin) Gracevit (sitafloxacin, only sold in Japan)
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Distribution network
Channel structure, members and their selection
The reach of the channel structure of Daiichi sankyo is all over world . The channel structure is very simple and effective. Complications are kept out in order to make the overall process very effective and efficient.
Channel structure
DAIICHI SANKYO Dealer/ distributor Warehouse Dealer shops (Chemist) End customer
Selection of dealers
DAIICHI India as well as out of india follows a strict policy in selection of the dealers, since dealers are the first impression a customer has about the company and therefore it is necessary to fulfill the following pre- requisites to be eligible to become a dealer: 1) The dealers shop should be centrally located. The proximity to another DAIICHI dealer should be taken into consideration. An already authorized dealer is taken into consideration when providing a newer dealer registration.
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2) The dealers goodwill, measured in terms of areas such as infrastructure, manpower etc. and individual goodwill i.e. the persons investment capability etc. 3) The dealer should have his own infrastructure and logistics, since he is completely responsible for the inventory and transportation of the goods to the shop from his warehouse. The company communicates with the dealers on a regular basis. All the strategies and plans are formulated at the corporate office of DAIICHI SANKYO ., which are then communicated to the dealers online through the extranet of the company. DAIICHI SANKYO has a DEALERSHIP MANAGEMENT SYSTEM through which all the regional offices, dealers etc. all over the country are connected. Any important notice, schemes or policies that needs to be implemented across all the offices and dealer network of the country, are updated through this system and in a matter of few seconds, all the dealers are informed about it. 4) The visibility of the shop and the shop area, shelf area, numbers of counter personnel are taken into account. The warehouse and the warehouse space and location from the actual shop is taken into account.
Responsibilities and Functions of the dealers DAIICHI SANKYO . believes in Customer Loyalty and thus expects that their dealers apart from selling pharmaceutical products should perform the following functions for better customer relations management: 1) Sales promotion through regular promotional schemes, road shows, campaigns etc. the expenses incurred by the dealers is shared by the company only if these activities are for promotion of the company and not of the dealer. 2) Training and development of manpower with company assistance
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3) Servicing according to the size of orders 4) Customer relation management 5) Promote other products of the company 6) Create goodwill for the company The dealer should be in regular touch with the customers, pharmaceutical ers and architects keep taking their feedback and ensure maximum customer satisfaction. The dealer should also try and convince the customer to try newer products of the company. The dealer has to thus cater to 3 major areas: Pre sale Selling Post sale services SALES KIT: A dealer should carry the following in his sales kit: All products leaflets (adequate quantities) List of prospects with their addresses Information about the competition in the market Price list of ABBOTT products and corresponding prices of competitor products Shade cards Financial terms The various modes of payment through which the dealer pays for the products, he has to receive are: 1) Cash/ Cheques/ Demand drafts 2) Credit cards 3) Letter of credit
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Margins The dealers collect their margins at the time of sale of the product. The margin varies according to the type of the product. Performance Appraisal For the dealersDAIICHI SANKYO appoints HR managers with various dealers, who are responsible to layout, the companys guidelines which the dealers are supposed to follow. Dealers have a company appointed business development manager (BDM) to advise them from time to time. The company through calculation of the Sales Index conducts the performance appraisal for dealers. The company appoints a third party research firm who is actually responsible for the market surveys, research, analysis and interpretation of the figures DAIICHI SANKYO . maintains a Scorecard for each dealer, in which guidelines are listed regarding certain aspects such as shops, infrastructure, sales promotion, qualifications and eligibility criteria of the staff recruited. These appraisals are conducted yearly and on the basis of these results certain monetary incentives or trips to various destinations, gifts, vouchers etc. are provided to the dealers. The dealership of any dealer can be cancelled for violation of company norms. The order processing system is as follows: Walk in Demand Customer requirement Quotation Payment
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Delivery
DAIICHII India uses various materials management software to improve the efficiency of the overall process, right from the beginning of the inputs of the raw materials to the final product which reaches the dealer. The process uses push and pull technology to achieve excellence. This technology actually uses the pull protocol to pull in the raw materials in the manufacturing process and the order management process. The push protocol is used to push the finished products to the warehouses. Similarly the pull protocol is used to pull the finished products to the shops and dealer networks by the dealer. RESPONSIBILITIES OF A SALES PERSON PRE-SALES Cold calling prospect generation Creation of customer card Generation of prospect base Update knowledge of companys products and its competitors Update knowledge of the companys new business and products Update knowledge about the entire product line and accessories Update knowledge about warranty and service
SALES RELATED Visit the prospect Understand his needs and create interest Give an appropriate solution Give demo and offer test drive Handle objections Follow up with the prospect Secure order
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DELIVERY Help customers in: Knowledge about warranty (very specific in pharmaceutical industry- only manufacturing defects) Knowledge about service requirement Complete demonstration if required in big/ bulk orders Suggest accessories
POST DELIVERY Help customers in: On time service Proactive problem solving
RELATIONSHIP MANAGEMENT Keeping in touch with the customers Wishing channel members (B2B) on special days Proactive feedback
PERFORMANCE APPRAISAL OF SALES PERSON The company according to the Sales satisfaction index monitors the performance of a sales person qualitatively and quantitatively. The incentives given to the salesperson varies according to the price of the product he successfully sells. This report is then used by the company to further decide the incentives to be given. The company also provides training and development to the sales force, which is done either by the company or by a third party consulting firm.
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FEEDBACK FROM CUSTOMERS

Customer feedback is obtained not only after servicing as mentioned earlier, but post sales too. There are 2 types of feedback forms customers can fill: 1) Direct feedback to the sales people. 3) A feedback to company through questionnaires and cards All these feedback cards are sent to the corporate office of the company where the required action is taken.
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Corporate organization
Corporate (the global corporate office and Japan Company Administration Division) will be integrated and divided by category based on function into the Corporate Strategy Division, the Corporate Management Division, the General Affairs & Human Resources Division and the Legal Affairs & CSR Division to consolidate organizational functions and enhance closer cooperation. By increasing coordination of local/global and short/mid to long-term, Daiichi Sankyo seeks to ensure high-level linkage among the four divisions and realize the full application of Corporates resources. 1) Corporate
Strategy Division
The Corporate Strategy Division will be created to consolidate mid to long-term business planning and the strategic planning and promotion functions. The division will comprise the Corporate Strategy Department (new), the Business Development & Licensing Department, the Global Brand Strategy Department (new), and the Intellectual Property Department. Creation of the Corporate Strategy Department This department will plan Group management and business strategy and provide unified strategic support for corporate heads to improve coordination within the Group. Creation of the Global Brand Strategy Department This department will integrate product strategy and the function of the current Global Marketing Department. It will seek to optimize the value of global products with a wide-ranging business plan that includes strategic planning and promotion beyond marketing. With the creation of this new department, the current Global Marketing Department will be phased out. 2) Corporate Management Division The Corporate Management Division will consolidate the functions, centered around
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annual corporate planning and business strategy, which promote effective management of the challenges faced by the Group in addition to effective utilization of Group resources . The unit will comprise the Corporate Business Management Department (reorganized), the Finance & Accounting Department, the Corporate Communications Department and the IT Strategy Department (reorganized). Reorganization of the Corporate Business Management Department The current Business Management Staff and Japan Company Administration Division functions will be reorganized with the aim of controlling budget and performance management for each business in and outside of Japan and ensuring comprehensive management of Group companies in and outside of Japan. Reorganization of the IT Strategy Department The current IT Strategy Staff and Japan Company IT Strategy Department functions will be integrated and reorganized into the IT Strategy Department. 3) General Affairs & Human Resources Division The General Affairs & Human Resources Division will be set up to consolidate promotion of personnel management to support implementation of corporate planning and business strategy, and organizational functions dealing with planning facilities and sourcing. The division will comprise the Human Resources Department (reorganized), the General Affairs & Procurement Department (reorganized), and the Secretariat Department. Reorganization of the Human Resources Department This department will integrate and reorganize the current Human Resources Strategy Staff function and Japan Companys Human Resources Department. Reorganization of the General Affairs & Procurement This department will integrate and reorganize the current Corporate Business Management Staff function and Japan Companys Administration Division Procurement Planning Group.
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3) Legal Affairs & CSR Division The Legal Affairs & CSR Division will be created to consolidate the functions of legal, contracting, internal control, compliance and CSR implementation. The new division consists of the Legal Affairs Department and the CSR Department. The Internal Audit Department, which is directly supervised by the CEO, will coordinate as necessary with this department in order to ensure information sharing for smooth business operations. Creation of the CSR Department The CSR Department will integrate the functions of the current CSR Staff, CSR Management Group of the General Affairs Department, and the Legal & Compliance Group of the Legal Affairs Department to enhance total management of CSR. II. Japan Company Japan Company is specialized for sales of innovative pharmaceuticals in Japan. The sales structure will include domestic pharmaceuticals, established drugs (DSEP) and the vaccine businesses. 1) Creation of the Japan Business Management Department With the integration of the global corporate office and Japan Companys Corporate Management Division, this department will be created as a staff organization for the company president to perform operations planning, budget procurement and management 2) Business Intelligence Division Restructuring of the Post Marketing Studies Management Department The function of the Product Lifecycle Management Department will be transferred to the Post Marketing Studies Management Department, and the Product Lifecycle Management will be phased out. 3) Sales and Marketing Division The current functions of the Sales Planning Department, Product Marketing Department and Promotion Management Department will be organized into the Sales Planning Department and the Marketing Department. Also, the Training & Information Department will be created to enhance the corporate function which carries out advanced promotion of
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MR activities and deal with increasing regulations on sales. Creation of the Training & Information Department The Training & Information Department will handle human resources training, product-related training, and media communications. 4) Creation of the Vaccine Business Development Office The Vaccine Business Development Office will be created to handle planning and promotion for the growing vaccine business. 5) Creation of the Vaccine Business Strategy Department The Vaccine Business Strategy Department will be created to coordinate the growing vaccine business with Group companies. Name change for Vaccine Business Strategy Department The Vaccine Business Planning Department will be transferred from the Business Intelligence Division and renamed the Vaccine Business Strategy Department. III. ASCA Company 1) Name change for the Business Planning Department The name of the current Japanese Business Management Department will be changed to the Business Planning Department in line with added focus on ASCA regional business Market Research: R&D Division The current research head and Japan development head will be reorganized as the Research Oversight Function and the Japan Development Oversight Function to separate and clarify the responsibilities of the research and development fields in the R&D Division while boosting autonomy and ability to respond quickly. 2. DAIICHI SANKYO ESPHA CO., LTD. 1) Dissolution of the Sales & Marketing Division With the strengthened authority of corporate, the Sales & Marketing Division will be phased out to speed up decision making, flatten out the
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organizational hierarchy and strengthen upper management. 2) Creation of the Corporate Management Department The Japanese Business Management Department and Sales Administration Department will be combined to form the Corporate Management Department to remove overlap in responsibilities, boost efficiency, and ensure functional enhancement. 3. DAIICHI SANKYO HEALTHCARE CO., LTD. 1) Creation of Direct Marketing Office With the start of the direct marketing business, the Direct Marketing Office will be created with different functions from the retail marketing business to ensure rapid strategy formulation and implementation.
Service Network
Structure:
Group Head
Service Support
Field Support On the job Training
Backend
T&D
Dealer
Development
CRM
Day to day activities Warranty
DAIICHI world closely monitors each and every aspect of the entire process in the business organization. The service network is similar to that of ABBOTTbut the CRN and training and development is not that developed. The technical support in the business units is different as we have already discussed earlier that ABBOTTuses SAP and i2 technologies while DAIICHI uses push and pull protocol.
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ANALYSIS
The total size of the sample used was 15 each for ABBOTTand that for DAIICHI India. For the sales people the total size of the sample was 2 for each company. The parameters that were taken to check the effectiveness and the rating scale are as follows: Scale 1 Scale 2 Scale 3 Scale 4 Strongly agree- 4 Agree- 3 Neutral- 2 Disagree- 1 39PHARMACEUTICAL
Very satisfied- 4 Satisfied3
Not satisfied- 2 Not at all satisfied- 1
Excellent- 4 Good- 3 Average- 2 Poor- 1
Weekly- 4 Bi- monthly- 3 Quarterly- 2 Others- 1
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Scale 5 Always- 4 Sometimes- 3 Rarely- 2 Never- 1
Recommendations ON DAIICHI SANKYO

Daiichi Sankyo:
and ABBOTT
Just two days after Takeda Pharmaceutical Co. Ltd. unveiled more details about the global expansion of its new vaccine business which it expects to become the top vaccine supplier in Japan - Daiichi Sankyo announced March a vaccines joint venture with GSK that would create the number one vaccines business in Japan. The 50-50 joint venture Japan Vaccine Co., Ltd. will be led by co-CEO representatives from each company. The JVs stated goal is to join GSK's extensive vaccine pipeline with Daiichi Sankyo's domestic manufacturing, sales and development presence. Keeping all things equal, the companies will sell their prophylactic vaccines into the JV, and will earn for 50-50 profits. Daiichi Sankyo and GSK will also split the 100 million start-up capital for the venture, and each will send three executives to sit on the six-member board. Each company will be responsible for their own research, preclinical and pre-proof-of-concept and ultimately manufacturing of their own products. Japan Vaccine will step in for development after proof-ofconcept. GSK has been vocal about growth opportunities in Japan. The firm's Japan business grew 30% from 2010 to 2011, largely on the back of the human papillomavirus vaccine Cervarix (human papillomavirus types 16,18), which was added to a government reimbursement program for vaccines in 2010. Since then, Japan has leapfrogged to become Cervarix' largest market. The joint venture will begin operations July 2.Dan Poppy
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ABBOTT
Abbott is readying for two major steps in its evolution. Most prominently, its preparing to split its pharma division from its diversified medical products business this year, creating two public companies from one. But its also preparing for December 2016, when its best-selling drug loses patent protection. Abbotts injectableHumira (adalimumab) for rheumatoid arthritis and other autoimmune diseases is currently among the worlds top sellers, with $7.9 billion in 2011 sales, representing more than 46% of Abbotts global sales of proprietary drugs. With less than five years time left on the clock, not to mention a looming threat of competition from oral drugs or lower-priced alternatives, Abbott is already looking for a successor. With that evolution in mind, Abbott made like the HMS Beagle and set sail for the Galapagos this week specificially Galapagos NV of Belgium, where among the tortoises and finches lay the crown jewel GLPG0634, a selective JAK1 inhibitor thats already shown promising data in a Phase IIa study in rheumatoid arthritis, and is expected to enter a Phase IIb dose-range-finding study soon. In an extremely rich deal for a mid-stage candidate, Abbott paid $150 million up-front to claim worldwide rights to the drug, and will pay a second $200 million licensing fee if the Phase IIb study yields data that satisfy a set of pre-determined but undisclosed criteria. Additional milestone payments could add $1 billion more to the deal, while Abbott remains on the hook for double-digit royalty payments if GLPG0634 is ever commercialized. For Abbott, its a way to make doubly sure that its autoimmune franchise is extended. Last summer, the company paid $85 million up-front to license German biotech Biotests BT-061, a Phase II antibody that binds to the CD4 protein and slows overreactions of the immune system. That gives it two potential successors to the same blockbuster drug, providing insurance that its sales force will have something else to sell once Humira begins to fade. And it gives Abbott another promising molecule to talk up on its current road shows, in anticipation of the looming split and the public offering that will accompany it. Its also just the latest in a series of deals in which Abbott has outbid and outspent its peers for assets that still carry plenty of risk. The company has twice paid Reata Pharmaceuticals top dollar
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for its compounds, buying ex-U.S. rights to chronic kidney disease treatment bardoxolone for $450 million in 2010 and nabbing a group of pre-clinical antioxidant inflammation modulators for $400 million late last year. If its going to be an independent company, Abbotts pharma division would do well to be better-balanced, with a diverse group of revenue-generating products. Without the diversified medical products business to balance things out, its weaker quarters on the pharma side may be all the more obvious and damaging. Thats one reason why Galapagoss drug seemed like a natural selection for Abbott and why we hope youll join us on another pun-filled voyage of
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ANNEXURE
Questionnaire for Channel Members

Name : Phone no :
Address:
Organization: 1) What are the expectations of the channel members from the company? 2) What is the distribution network of the company?
3) What do you think about the distribution network of the company? Excellent Good Average Poor
4) Whether the company is able to provide material in time or not? Excellent ReasonsGood Average Poor
5) What is the credit policy of company to its channel members?
6) What is the attitude of company sales representatives? Very satisfied Satisfied Not satisfied Not at all satisfied
7) Whether companys sales representatives are really help them in getting big orders?
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8) What is the frequency of sales people visit to its channel members? Weekly Bi monthly Quarterly Others (please specify)
9) What kind of promotion company is doing to increase their sales?
10) What percent of margin they are getting for selling the product? 2% - 5% 5%- 10% 10%- 15% Above15%
11) What kind of reward company is providing to you, if they achieved their target?
12) Which product lines from major companies are you distributing?
13) Who bears the cost of transportation/?
14) What is your storage Capacity?
15) Did the company meet the expectations of delivering the product on time? Always Sometimes Rarely Never
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16) Are you satisfied with the availability of product at warehouses of company? Very satisfied Satisfied Not satisfied Not at all satisfied
17) What is the condition of product at the time of delivery? Excellent Good Average Poor
18) How do you relate the behaviour of transporters?
Very satisfied
Satisfied
Not satisfied Not at all satisfied
19) Does the company show flexibility in its delivery and quantity operations? Always Sometimes Rarely Never
20) Whether companys sales people are able to explain product features clearly or not? Always Sometimes Rarely Never
21) Whether companys sales people able to explain company policies to you? Always Sometimes Rarely Never
22) Whether salespeople able to handle the complaints efficiently? Always Sometimes Rarely Never
23) What is the response time of salespeople?
24) How frequently does the company take the feedback from you? Very Frequently
GROUP-SS 10-12
Frequently
Sometimes 45PHARMACEUTICAL
Never
IIPM
Questionnaire for Companys Sales People

Name : Address: Phone :
Organization:
1) What is the sales hierarchy of the Sales Department?
2) What are the expectations of company from its channel members?
3) What are the objectives of company saless people?
4) What is the distribution network of company?
5) How they are able to make co-ordination between channel members?
6) What criterion they used for the selection of channel members?
7) How they maintain performance appraisal system for Sales People?
8) Who does the performance appraisal for the sales people?

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9) What is the frequency of the performance appraisal?
10) What format that is used for the performance appraisal?
11) What are the criterions of performance appraisal of salespeople?
12) What kind of rewards they generally give to their channel members for achieving the target?
13) What is the frequency of visits to channel members? Very Frequently Frequently Sometimes Rarely
14) What kind of relation they maintain with their channel members?
15) How they are able to motivate their channel members for achieving the target?
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16) How company is motivating the sales people for achieving the objectives of business?
17) Which of your IT infrastructure do you share with your distributions?
18) Do you have your own distribution network?
19) Which trade shows you generally participate in?
20) How empowered are salespeople to solve the problems of channel members? Strongly Agree Agree Disagree Strongly Disagree
21) Are you satisfied with numbers of promotion activities undertaken by the company? Very satisfied Satisfied Not satisfied Not at all satisfied
22) Who bears the cost of transportation?
23) What are the modes of transportation?
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24) What are the various cost involved in transportation?
25) What type of market research being carried out by the organizations with respect to customers?
26) What type of targets company sets for its sales people?
27) What factors are taken into account while finalizing and assigning targets?
28) What factors are taken into account while assigning territories to salespeople?
29) What are the payment terms for the sales people?
30) What percentage of discount are you authorized to give to the company channel members? 1% - 5% 5%- 10% 10%- 15% Above15%
31) What percentage of margin the sales people get for selling the product? 1% - 5% 5%- 10% 10%- 15% Above15%
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32) Do you think your company is providing you with the best infrastructure? Very satisfied Satisfied Not satisfied Not at all satisfied
34) How frequently does the company take feedback from you? Very Frequently Frequently Sometimes Rarely
35) How often does company respond to the customers view? Always Often Sometimes Never
36) How do you rate the companys customer orientation process? Excellent Good Average Poor
37) How do you relate the behaviour of transporters? Very satisfied Satisfied Not satisfied Not at all satisfied
38) What is the condition of product at the time of delivery? Excellent Good Average Poor
39) Does the company show flexibility in its delivery and quantity operations? Always Sometimes Rarely Never
40) What is the frequency of sales people visit to its channel members? Weekly Bi monthly Quarterly Others (please specify)
41) Are you satisfied with the quality and quantity of promotions? Very satisfied Satisfied Not satisfied Not at all satisfied
42) Do you agree with timing of promotions and distribution? Strongly Agree Agree Neutral Disagree
GROUP-SS 10-12
50PHARMACEUTICAL

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IIPM

SALES & DISTRIBUTION MANAGEMENT PROJECT

IIPM IIPM TOWER,SATBARI, CHANDANHAULA,CHATTARPUR-BHATIMINESROAD NEW DELHI

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

DATA COLLECTION TOOLS

SAMPLE SIZE USED

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

Indian Pharmaceutical Market

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

COMPANY BACKGROUND Abbott Laboratories

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

Responsibilities and Functions of the dealers

products should perform the following functions for better customer

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SALES & DISTRIBUTION MANAGEMENT PROJECT

Complete demonstration if required in big/ bulk orders Suggest accessories

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

FEEDBACK FROM CUSTOMERS

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

Field Support On the job Training

Day to day activities Warranty

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

SECTOR- ABBOTT& DAIICHII

SALES & DISTRIBUTION MANAGEMENT PROJECT

PRODUCT OF DAIICHI SANKYO