Sales & Distribution

Management of Dinshaw`s

Section- B

Submitted by:

Aditi Chauhan 201610314

Atharva Chandorkar

Mukund Kela
201601138

201611316
17
Ruchir Jain 201601150

Sonali Galkate 201600327

Vaishali Gupta 201610308

 ACKNOWLEDGEMENT

We would like to express our profound gratitude to all

the team members who have been instrumental in the
preparation of project report. To start with, we would
like to thank Institute of Management Technology,
Nagpur for providing us with the opportunity to
undertake this Sales & Distribution Management field
project and allowing us to explore the practical
knowledge to the distribution system of the company,
which will surely prove to be very beneficial to us in our
future assignments, our job and our career ahead.

We wish to place on records, our deep sense of gratitude and sincere appreciations to our
faculty guide Dr. T. K.Chatterjee, for allowing us to take this field study. We would also
like to thank him for his continuous support, advice and encouragement.

We are deeply grateful to, Mr.Chaturnhuj Gavhaney (Head of Sales and Marketing, Dairy
division) for his valuable insights to how sales and distribution works in Dinshaw`s. His
knowledge in the field of diary and sales has enriched our knowledge.

Last but not the least, we would take this opportunity to thank our Family for the immense
support at each and every aspect of our life

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Introduction
Dinshaw company has long history of manufacturing various products with the quality as its
prime focus along with the building a strong and trusted brand in India. Following are the
major milestones which company has achieved form its inception in Nagpur, Maharashtra.
The Company started in 1932 from Nagpur with the premium product of Ice-cream
manufacturing. At that point of time ice-cream was considered as one of the premium product
in dessert category due to which Dinshaw was having a focused target group to offer its
product.

From the beginning the company focused on the quality issue which helped the company to
build its brand in central India and increase the loyal customer base. In 2002 Bapuna family
joined Dinshaw which helped the company to go into the large market of India and increase
its product range. To cater the increasing demand from customer, company setup new
manufacturing plant and increased its production to a large extent.

Following is the timeline of the events which company has come across from the beginning
which helps to understand the company in a better way.

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IMPORTANT MILESTONE

• Started Dinshaw's handcrafts premium ice cream in India

1932

• Growth of Business in a Market where Icecream was still a Luxury

1950 Product

• Company started with Single-Store Operations

1972

• Induction of 'Jimmy Rana' one of the most recognized product of

1981 Dinshaw

• A well known Brand across India for its Quality of products

1991

• Bapuna Family joined Dinshaw as a equal Stakeholder for increasing

2002 the growth speed of business

• A new 50000 lit./day manufacturing plant was established

2012

• A leading Brand in India for its Quality, Taste and Trust

2017

OBJECTIVES OF THE STUDY

 To discuss Dinshaw’s sales, sales management and related concepts

 To gain knowledge about the structure and objectives of sales in the organization

OBJECTIVES OF SALES MANAGEMENT AT DINSHAW’S

 Providing sufficient profit
 Achieving sufficient sales-volume
 Experiencing continuous growth

RELEVANT CONCEPTS
Concepts which are relevant and which we came across during our study for the sales and
distribution are as follows:

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RIGHT SET OF CIRCUMSTANCES THEORY
Creating set of circumstances will make the sale happen which depends upon internal and
external forces.

 External force could be the sales person himself as in the skills and experience of the
sales person.
 Internal force could be buyer’s mood.

RELATIONSHIP BUILDING
In order to sell a product, a customer and dealer network is important. Instead of directly
pitching a deal to the retailer the distributor should maintain a strong relationship with the
retailer so that he can further increase the sales of the product.

Relations with the retailers can be maintained by incentivising them and also giving them
good margins over the product.

MOTIVATION
When the target of the sales representative is achieved the manger should motivate his
employees so as to increase their will to sell more the next time. It also encourages them to
perform and learn better as they get recognized by their managers.

Hence motivation helps in achievement of targets.

DISTRIBUTION CHANNEL CONCEPTS WHICH ARE USED BY THE COMPANY

A distribution channel in marketing refers to the path or route through which the goods and
services travel to get from the place of production or manufacture to the final users.

Business to Business (B2B) distribution occurs between a producer and industrial users of
raw materials needed for the manufacture of finished goods.

Business to Consumer (B2C) distribution occurs between the producer and the final users.

Direct vs. Indirect distribution

Direct distribution (Zero level): Here the product or service leaves the producer and goes
directly to the customer with no middlemen involved. For example in case of car wash or
haircut the service is directly received by the consumer as no middlemen is involved in
between. This also occurs with organisation that sells tangible products, like jewellery where
the manufacture directly sells it to the customer.

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Indirect distribution: it occurs when there are middlemen or intermediaries within the
distribution channel. Following are the types of indirect distribution-

 One level Channel: In this method an intermediary is used. Here the manufacturer
directly sells the goods to the retailer instead of selling it to the wholesalers or agents.
This method is useful for selling FMCG products.
 Two level Channel: In the method the manufacture sells the goods to the wholesaler
which sells it to the retailers which then sells it to the consumers. Here the
wholesalers buy the products in bulk from the manufacturer and sells it in small
quantities to the retailers. This medium is mainly used to sell products such as sugar,
ghee, tea, salt etc.
 Three level Channel: Under this one more level is added in the form of an agent. An
agent facilitates to reduce the distance between the manufacturer and the wholesaler.
Some companies appoint agents in every region and sell the material to them. The
agents sells the materials to the wholesalers who then sells it to the retailers who then
sells it to the end consumer.

Some companies also take the help of Value Added Reseller (VAR) who bundles it with
services or other products and resell it. VAR adds value to your product. A VAR may work
with the end users to determine the right products and configurations, and then implement a
system that includes your product.

Wholesalers, resellers, retailers, consultants and agents already have resources and
relationships to quickly bring your product to market. If you sell through these groups instead
of selling directly to the end users, treat the entire channel as a group of customers since they
are buying your products and reselling it. Understand their needs and deliver strong
marketing programs and turn will increase the revenue of everyone involved in the process.

DISTRIBUTION NETWORK USE BY DINSHAW

The company uses different types of distribution network for distributing its products. It is so
because of the different temperature conditions which are required by its products which
ultimately helps to retail the taste and quality of the product as per the expectation of the
consumer. The company uses cold storage trucks for different products to transfer from
manufacturing facility to distributor’s location. Ice cream, milk and milk products these three
have three different types of the distribution channel network.

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Product Range offered by the Dinshaw Company to its target group of customers in different
categories:

Milk

Dinshaw

Milk &
Ice Cream Bakery
Products

Figure 1- Business verticals of Dinshaw

Image 1- Product offering of Dinshaw

More than 85 years old company started with milk, milk products and then extended it to the
bakery. Ice cream is distributed in 14 cities of central India and neighbouring states like
Madhya Pradesh, Chhattisgarh, and Telangana. Along with this in some parts of Jharkhand,
Orissa, eastern UP, Goa and some part of Gujrat. The milk distribution is in 3 states. In these
three states, company cover 11 districts of Maharashtra not full state as there is challenge of
the distribution network as the milk van can go only 300 KM of distance in a day. Some parts

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of MP specifically the Mahakaushal region Chindwada, Siwni etc. All other products are
available at all those areas where the milk or ice cream are also available. The distribution
network is conventional in nature i.e. Manufacture to distributer and then to retailer.

Toned Milk

'Prabal’
‘Sfurti’ Double
Various Types of Standardized
Toned Milk
Milk which is Milk
provided by the
Company to its
customers

‘Amrick’
‘Sarvottam’
Standardized
Milk
Milk

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The inventory management does not come into play for the milk as this have only 2 days of
life span thus daily closing and daily forecast method is used. Milk products are targeted as
per the customer segmentation in the cities like curd is distributed in the Bengalis and
Gujraties area more and the Srikhand which is traditional dish of Maharashtrians are
available in more number near their localities.

Following is the products which are available under the Milk & Bakery products category
from Dinshaw through its retailers across various states as per the customer preference and
taste:

Butter
Toast Curd

Milk Pav Ghee

Sandwich Milk & Bakery Lassi

Bread Products

Milk Bread Paneer

Doughnut Sweet Curd

Srikhand

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Above are the images of various products which are offered by Dinshaw in the bakery and
milk products to the targeted market in different territories as per the demand of the product
and demand generated.

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Bakery consist of Milk Bread, Sandwich Bread Doughnuts through the same channel which
is used for the distribution of the milk and milk products which help the company to save
cost.

Manging the channel partners: For every category of the product the company uses different
channel partners thus for them the management is also different from each other. This is
explained as follows:

Ice-cream: the distribution network for providing product consist of various step which are
from manufacturer’s place it goes to the depot level. Depot is controlled by the company but
is owned by a third party. The company usually hunts these carrying and forwarding agents,
i.e. the depot, guided by certain policies. For instance, stock holding, non-stock holding, slow
moving, fast moving, the turnover, and so on. These are some of the policies of the company
and we operate according to them.

Dinshaw Company provides a wide variety of the Product line of Ice-Cream to target group
which helps to get more shelve space at the retailer store along with that it helps to provide
competition to competitors in large number of areas. The company uses a separate
distribution channel as explained above in detail to reach its customers in the shortest span of
time. Following are the images of Ice-cream products which are offered by the company to
different target markets as the segmentation policy adopted by the company.

Product varieties available in ice-cream:

Dil Hi
Toh
Cones
Family
Allure
Pack

Varieties of Ice-
Sunsation Cream Offered Fruit Tree

Kulfeast Frolix
All's
Right

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Channel partners are the people who are interested in doing this business, as such there’s no
differentiation. Whoever can provide the basic setup and facilities for our products.
Supposedly, someone has a space available in a particular town, owns a cold storage and he
wants to start a business, the company appoints such people based on his interest. For
example, Raipur is a town where a depot caters to 600 outlets. Now, based on this the
company provides them with the stock. Here, company’s main concern is the temperature at
which the stock is stored apart from the shelf life of the products. Now, based on this we have
our constraints. Again for example, for 350 outlets the company will appoint one distributor
and for every five distributor the company has a specific depot. Although this rule is not
fixed, it varies based on the geography and area. The distributor then stocks based on the
demands from the retailers. Accordingly it then goes to the retail based on the secondary
sales. Secondary sales happens when a person goes to the retail point and asks for orders,
books the orders and passes on this information to the distributor, who in turn supplies the
stock.

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 Carry forwarding Super Stockiest or
Distributor Retailer
agent Depot

Secondary Sales

Along with the distribution network the important element on which the company keeps an
eye is relationship with its distributors and retailers. Thus methods use by the company for
managing the relationship with its distributor and retailers are:

A) Compensation: The Company follows a certain pattern of the inventory, also known as
the selling pattern. Categories such as ice-cream cones like butterscotch etc., are the fast
moving products where the company gives a 2 percent benefit to the channel partners. For
slow moving products the company has different value of compensation. The compensation
also depends upon the clubbing of various aspects such as electricity consumption at the
depot, stocking pattern, etc. according to which the company has various calculation
parameters, based on which the expenses related to manpower and other things are
calculated. Further based on these calculations, the marginal cost of the product is
established.

B) Incentives: incentives are provided based on the achievement of selling targets. Various
slabs are set as targets for the channel partners and fulfillment of these targets attract great
incentives.

To make sure that the display of the product should be at the right place in the retail store and
correct ordering of the product should be done the company uses various tools which are
described as follows:

A) The company follows an online order booking process that ensures what kind of the
ordering is done by the retailer and what kind of product is being placed by them. Based on
the type of order history of the retailers, the sales force of the company is provided by an MIS
where they need to push the required products to these retailers, on the other hand ensuring
that the inventory is maintained accordingly. The company has a designated sales force to

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look after this. Behind every 350 outlets, there is one designated Area Business Executive
who frequently visits the outlets to make sure that the reach and visibility of Dinshaw’s
products are maximized.

Vice President

Regional
Manager

Area Manager

Sales Executives /
Front Liners / Area
Business Executives

As the company is having a large number of distributors thus there are many chances that the
there is competition which goes in between two distributors which may hamper the sales of
one over the other. Thus to reduce the conflict between the distributors company has a very
robust network of distribution which further helps the company does not face such issues for
about 95 percent of the times. For the remaining 5 percent, such issues arise due to
incapability of a distributor to provide service to the retailer, or due to bad distributor-retailer
relationship between them. Usually such mishaps are successfully handled as the company
has a well-defined structure and planning related to distributors and their routes.

Few items may not be so well taken by the customers. For that, the company studies the trend
in marketing. It has formed a range of items - Impulse items, novelty items, regular family
packs.

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For impulse items, the customer is the one who has no firm decision of buying a particular
flavour, he/she decides it at the point of purchase. Examples: twin bars, ice lollies, etc. It also
depends on area e.g. Family pack is most selling item in Gujarat. Mumbai, being such an area
where people try new varieties – novelty items (ice cream pastry, cake pastry, twin bars,
masala kulfis, pan kulfis, twin kulfis. The other kind of items to be pushed are based on the
customer preference in that particular area.

The company entertains suggestions from retailers for products, because it is the retailer who
is in direct contact with the customer. It follows an ordering pattern between sales people. As
his/her incentives are based on the sales he generates for the company, so the sales force
cannot restrict itself to the bestselling products but also has to push other products.

Apart from this motivation plays a key role in the employees of the company without which
the sales network of the company will not able to perform at all. Thus the company always
focus on ensure that each employee should be motivated so that the company grow at a faster
rate.

Every executive has his/her target based on the type of items- impulse, novelty and family
packs. For each items, there are separate executive. The sales force has a fixed percentage of
contribution from sales in his incentive. The challenge is that we push high end value items.
We are aware of the fact that dealer lending price is more, so more dealer price product are
pushed heavily.

Problems that company face: The Company has forwarded items to dealers but the dealer
doesn’t forward it to retailer.

The company has an online process – mobile order booking. The use of technology has
helped them to get real time information. Example x- distributor is catering 300 outlets, all
these 300 outlets are listed in the mobile application. The company thus knows the ordering
pattern and makes sure that distributor and channel partners should be happy. The distributor
also gets the information regarding number of orders and return on investment in the
application itself. However, each system has its own drawbacks, nothing can be error-free. 2-
3% error does occur which is considered to be negligible.

Dinshaws entertains no goods return policies. From the company to distributor, the company
is responsible to deliver the perishable items, in case of mishap, they have back up system.

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However, the company is not responsible for the damage caused by the distributor while
transmitting the products to retailer.

Qualities in sales force which company looks in the candidate before offering the job are

1. Front liners- communication skills, geographical knowledge

2. Middle liners – local newspapers, placement consultancy, graduation criteria- basic
knowledge about distribution and industry experience
3. Area managers – Territory knowledge, study background from good institute,
experience
The products of the company comes under the perishable category thus the forecasting of the
demand is very tough for the company before starting the production. Thus to ensuring the
correct demand for the very next day company uses following strategy:

The company is having an extensive network of distributors who go to every retailer every
day to know the demand so that the company can manufacture it accordingly. We are into
products which can’t be pushed to the retailers. If there is a festival coming up and the
demand gets increased, the company makes sure that they have sufficient quantity with them
to fulfil such unusual demand. So the forecast is one of the major factor taken into
consideration in companies like Dinshaw which deals into fresh products.

In this competitive scenario where policies of the government also plays an important role in
any business the company also faced certain issues with new tax reform i.e. GST which is
explained in detail as follows:

Initially the company did face some problems when people didn’t have cash. But as our
company deals into fresh products and products that are consumed by every household every
day we didn’t suffer much problem as other industries did.

The company has to deal with many issues on day to day basis. Thus for solving these
problems managers adopt various techniques which help the company. Major problem that
the company face is inventory management of fresh products stored in temperature (0-4
degree Celsius) like Milk. Here the product shelf life is the lowest so to meet the demand
correctly and minimise the loss we have to manufacture it perfectly. Like say product X has
10 day shelf life, the ageing of the product start in the warehouse only and due to this the
distributors are not taking the products in bulk having the fear that it will get damaged if not
sold and the loss would have to be borne by them. So to avoid such problems company make

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sure that forecast has been done correctly and make sure the communication with the retailers
is done properly so that there is no mismatch in the forecast of both the company and the
retailer.

With the increase in the market share in the central India Company is now looking at the
expansion plan in the future. Dinshaw has been able to garner 50% of market share in fresh
products in the west and is the market leader in Nagpur when it comes to Milk. But then also
company still have at least 2 years to expand in the north India taking every factor into
account like cost being the major one.

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