Sales and Distribution Assignment

Saransh Mahajan
B15167
BM-C
Distribution is a crucial aspect of marketing. A distributor is the middleman between the
manufacturer and retailer. After a product is manufactured, it may be warehoused or shipped
to the next echelon in the supply chain, typically either a distributor, retailer or consumer.
The other components of the marketing mix are product management, pricing, and
promotion.
Frequently there may be a chain of intermediaries, each passing the product down the chain
to the next organization, before it finally reaches the consumer or end-user. This process is
known as the 'distribution chain' or the 'channel.' Each of the elements in these chains will
have their own specific needs, which the producer must take into account, along with those of
the all-important end-user.
Mechanics of Distribution Channels of FMCG Sector
The supply chain of products in the FMCG market in India is one of the longest supply
chains an industry could really have. There are as many as 5 levels of intermediaries involved
in the entire supply chain through which a product passes before reaching the end consumer.
FMCG products are normally a high volume and products have to essentially be available in
the market at all given points of time and at all given points of purchase and therefore the
distribution activities are highly volatile and dynamic. The supply of products takes place
virtually on a daily basis in fixed quotas or otherwise, to retailers as per their requisitions and
the anticipation of demand and the performance of products in the recent past. All such
criteria are taken into consideration before the quantum of products being dispatched to the
next level of intermediary. Since its a volume game, manufacturers make all possible efforts
to boost sales and promote their distributors to earn more and more orders from the retailers
and wholesalers. A close check is maintained on the flow of the products on a daily, weekly,
fortnightly and monthly basis to determine the trend in the business and flow of products and
consumption. This activity also helps to find out drawbacks of the distribution system, if any,
and rectify them within time.

I shall be explaining the distribution channels of the following FMCG firms in India

Britannia
Dabur
Parle

Britannia
The following shows the sales force organisation in the company
Zonal
Branch
Manager
Zonal
Sales
Manager

Zonal
Sales
Manager

Zonal
Sales
Manager

Territory
Manger

Territory
Manger

Territory
Manger

Distribut
or

Distribut
or

Distribut
or

Distribut
or

Distribution Style
Intensive Distribution: As biscuits and cakes need to reach the consumer at their nearest
locations so this type of distribution channel is used. This type of distribution helps customer
looks for location convenience.
Britannia
factory

Wholesale
r/
Distributor

Retailers

Kirana
stores

Customer

Agents

Big retail
Units

Parle
Today, the great strength of Parle Products is the extremely widespread
distribution network. Even at the remotest places, you can buy Parle
biscuits and sweets from the local grocer. It has taken years to create this
extensive network. Parles sales force started with one salesman in
Bombay and some agents in few other cities. Gradually, Parle Products
expanded. Soon sweets and biscuits were being sent by rail to Calcutta,
Delhi, Karachi, Madras and other major cities. As production increased,
distribution was amplified. Full time salesmen were appointed in different
areas
Distribution Channel

Channel members of the distribution network: The Parle distribution network

for biscuits has essentially four levels as enlisted below:
Parle Depots
Wholesalers and Distributers
Carry Forward Agents (if required)
Retailers

The companys 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 industrys main
problem. While the other companies fail to replenish demand due to lack
in procurement of raw material, Parles inventory management is sound.
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.

Dabur
Distribution Channel
Manufacturer
Warehouse
Regional
Warehouse
Regional
Stockist
Super

Stockist

Stockist
Distributor
Retailer

This channel depends on the complexity of the product, if it is a product like pen, soap etc.
then the entire channel might be there, as the complexity of the product goes up the channel
size comes down. Most of the FMCG companies have a similar channel as described.