Evaluation of Distribution Network of Forage Seed Companies in Western Haryana

SYNOPSIS

Master of Business Administration (Agri Business)

By Amit Sharma

Institute of Agri Business Management S. K. Rajasthan Agricultural University Bikaner, Rajasthan

1. 2. 3. 4.

Name of Scholar : Registration No.: Enrolment No.: Title of Project

Amit Sharma 00/09/08/08/190 2008/57 Date of Registration:17/07/2008 Date of Enrolment: 10/06/2008 : Evaluation of Distribution Network of Forage Seed Companies in Western Haryana

5.

Expected Duration of the Work

From 18/04/2010 to 20/07/2010

6.

OBJECTIVES :
(i) (ii) (iii)

To identify the major players in forage seed segment To benchmark the distribution network of major forage seed companies To analyze the best distribution network for forage seeds

7. Product Introduction: India is basically an agricultural country and about 70 per cent of its people live in villages. Their livelihood is dependent mainly on agriculture and animal husbandry. Though India has a huge livestock population of over 343 millions, besides poultry, yet the production of milk and other livestock products is about the lowest in the world. This is due to unavailability of forage/fodder in sufficient amount. For filling the gap between demand and supply Government of India is taking major initiatives and private players are working hard to develop high yielding, multicut varieties suitable for various agro climatic zones. Forage is an important crop used for feeding purpose to animals and source of many essential nutrients Though the breeding objectives in forage crops are too many, yet a number of high-yielding and nutritive varieties in some of the important fodder and pasture crops have been developed by different agricultural institutions and private players . Haryana falls in a category of major forage growing farmers and many private players like Vibha seeds, Nitya seeds, Nuzeevidoo seeds, Mahyco seeds, Ankur seeds and multinationals like Devgen are present in hybrid forage product segment as it is the most preferred product by the cultivator in comparison to

other alternatives like hybrid multicut Bajra , Barseem , Sudan grass etc. Sorghum is popular forage in Western Haryana. The hybrid sorghum has high yield because of its profuse growth and multicut nature. It is early to medium maturity hybrid having medium height, reduced lodging, semi-compact ear and wider adoptability. Hybrids have high yielding potential with excellent fodder and grain quality. It has tolerance to aphid infestation resulting in production of good quality fodder. List of important hybrid sorghum in the area is as follows:
1. 2. 3. 4. 5. 6.

MRS 4094 MSH 51 MRS - 4649 WHITE PEARL 1 WHITE PEARL 2 MFSH- 4

8. IMPORTANCE OF PROPOSED INVESTIGATION:

8.1 Background Seed is the most important input for agricultural production. It forms the fundamental and crucial input for sustained growth in farm production. It limits the efficiency of all other inputs. In other words, if the seed is not of good quality, use of other inputs will not result in the highest yield. With the focus of the Indian agricultural policy fast shifting towards increasing productivity, use of high quality seeds has become more important. Distribution of assured quality seed is necessary for attaining higher crop yields. Policy initiatives taken by Government of India during 1960s and 1970s for generating quality seed production and distribution of improved plant varieties developed by the scientists is one of the reasons for the countrys self sufficiency in food grains. The Indian seed industry has shown impressive growth and should continue to provide further potential for growth in agricultural production. The role of the seed industry is not only to produce adequate quantity of quality seeds but also to achieve varietal diversity. Companies that develop, produce and market seeds will reap profits as Indian lifestyles and diets become richer. Now farmers have cash in hand and

they want to invest in seeds which produce faster, healthier crops from the same kerchiefsized plots. India has a total sown area of 170 million hectares. Grains and oilseeds take up the largest share, but the planted area for grains, flowers, fruits is increasing. At present only 14-15% of total seed utilized are occupied by hybrid seeds and only 18% of hybrid seeds by grain crops. With increasing grain consumption now grain growers and seed producers are seeing a better future but on the other hand this enhanced production is to be achieved with existing or less of land, water, labour, and other inputs and without adversely affecting the environment. Among the limited available options to increase production and productivity of grain, use of good quality seed appears to be a feasible and readily adoptable option to increase production and productivity to meet the future needs. Seeing the better future in grain seed business number of players in this business is increasing gradually. For getting success in this competitive era it is very important to maintain a stable supply and distribution network of good quality seeds. Distribution benchmarking is a buzz word these days in all industries and especially in seed sector. This process helps the company to know its strength and weakness, so that it can leverage on its strength and can overcome the weakness. Major grain crops which are grown in Western Haryana (Sirsa, Hisar. Kaithal, Jind, Fatehabad) are paddy, wheat, sorghum, castor, Cotton and vegetables. 8.2 Problem Statement Distribution network is a deciding factor for the success of any company. In this competitive age, company with more efficient and effective system of distribution will be more successful. Many companies try to establish a benchmark and try to adopt all the practices which are adopted by benchmark company .If they adopt all the practices of benchmark then they will become best in their sector. For benchmarking the distribution network adopted by different grain seed company twenty three parameters had been selected like number of distributors, distribution density, average distance, percentage overlap, sales volume, distributor width, distributor depth, retailer width, retailer depth, push-pull index, product display, problem solving nature of distributor, distributors shop location, transport facility with distributors, work force at distributors shop, age of the firm, payment habit of distributor, types of companies dealt by distributor, time period of dealing with a company, promptness in delivery, appropriating schemes, account settlement, and cordial nature of distributors. The present study will be undertaken with the following objectives to evaluate the

distribution network of different grain seed companies for Jowar seed and benchmark practices in Western Haryana (Sirsa, Hisar. Kaithal, Jind, Fatehabad).

9. REVIEW OF LITERATURE: The comprehensive review of literature is an essential part of any marketing investigation. As such, an attempt has been made to present brief and lucid details of the available literature in relation to the present study. Janakiraman, B. and R. K. Gopal. describe the marketing channel as, a set of independent organizations involved in the process of making a product or service available for consumption or use to the end user. Coughlin, Anne T., Erin Anderson, Louis W. Stern and Adel I. El-Ansary say, there are various functions of Marketing Channel members which are finding out markets and their potential, disseminating persuasive communications to stimulate purchasing, reaching agreements on price and other terms to effect the transfer of ownership of goods or services, placing orders with manufacturers, sales and funds collection, inventory management, risk identification and estimation for carrying out channel work, logistics, financing the payment of bills and supervising and overseeing actual transfer of ownership from one organization to another. These are also known as Marketing Flows as these processes often flow through the channel, being done at different points in time by different channel members.

Kotler, P., K. L. Keller, A. Koshy and M. Jha say, distribution channel is an integral part of marketing channels and can be defined as a chain of intermediaries starting from the doorstep of the manufacturer and ending at the final consumer. It has various members like Distributors, Wholesalers, Retailers and salespersons etc. whose major tasks are receiving orders, sales and collection, logistics, supply chain management, inventory management, promotional activities, after sales services, and maintaining the market.

Mukherjee, P. N. say, a benchmark is a point of reference against which other things are compared or measured. Benchmarking is the systematic process of continually searching for the best methods, practices and processes that yield the benchmark performance, measuring

its performance against them and then either adopting or adapting their good features and implementing them to become the best of the best. It can be used to compare performance of an existing process against other companies bestin-class practices and to determine how those companies achieve their performance levels and then improving internal performance levels. Distribution benchmarking is a new concept but is very important these days in all industries. It helps to learn from the market leaders experiences, understand methods for improved distribution practices and helps in identifying new opportunities in improvising distribution network, challenge internal paradigms on what is possible, better prioritize and allocate the available resources, set realistic but aggressive goals for improvement, uncover strengths within the organization and thus leverage on its strength and overcome the weakness and emerge as market leader by setting its own benchmarks. It can be done by examining various other parameters and own distribution system and its performance and then comparing it against the players having best performance on these parameters and excellent distribution system practices. Anvil (2008) in his study indicated that the production and productivity of most food grain crops has increased substantially since the famous Green Revolution of the sixties followed by the development, production , marketing and distribution of superior high yielding varieties of paddy and hybrids of coarse cereals like maize, sorghum and millet..

10. PROJECT METHODOLOGY

10.1 Collection of Data: All the five districts of Western Haryana (Sirsa, Hisar. Kaithal, Jind, Fatehabad) are selected for the study. Major grain crops which are grown in Western Haryana are paddy, wheat, sorghum, castor, Cotton and vegetables. For conducting the distribution benchmarking and keeping the time constraint purposively and supply and demand gap at the time of season, only sorghum crop is selected for the study.

The study will be supported by both primary and secondary data collected through structured questionnaires from distributors and dealers who are involved in the distribution and supply chain of product called forage sorghum in western part of Haryana constituting Sirsa, Hisar. Kaithal, Jind, Fatehabad districts. Secondary data will be collected from company database, Government departments, web portals and literature available from other sources etc. 10.2 Research Instruments: Separate schedules with both open and close ended questions will be used to interview the distributors, dealers, farmers and company personals after pretesting.

10.3 Sampling: Sample Size

Selection of Distributors: Distributors of the major companies having at least 20 dealers contributing at least 80% of total market size.

Selection of Dealers/Retailers: 5% of number of dealers under each distributor will be selected randomly.

Selection of Company personnel: 8 company executives dealing with forage product segment in study area.

Selection of Farmers: Each dealer 1 village will be selected and in that 4 farmers.

Sampling Procedure Purposive sampling method will be used for selecting Retailers, Distributors and Farmers. Convenient sampling method will be used for selecting Company personals. 10.4 Analysis of Data: For the analysis of data, suitable research techniques and statistical tools will be applied. The project will be carried out to fulfil the specified objectives of the study.

Collected data will be coded, classified, tabulated and validated. Based on the response received from respondents appropriate statistical tool will be used and inferences will be made. Weighted mean will be calculated for parameters of distribution system and will be used for knowing the overall performance of distribution network with the help of grid.

Formulae given under will be used in the study for analyzing the data. (a) Distributor width: Distributor width = Number of distributors of a particular company Total number of distributors in district (b) Retailers width: Retailer width = Number of retailers covered by a particular company Total number of retailers in a district

(c) Distributor Depth: Distributor Depth = Companys sales volume through distributors (in kg) Total sales volume by all distributors (in kg)

(d) Retailers depth: Retailers width =

Company' s sales volume through retailers (in kg) Total Sales volume through all retailers in district (in kg)

(e) Push-Pull index: Push-Pull index = Average Push volume

Average Pull Volume

For benchmarking distribution network adopted by different seed company, six parameters will be considered which are
1. Reach of Distribution Network

2. Sales and Collection Habits 3. Credibility level of the Distributors 4. Inventory Management by Distributors 5. Logistics 6. Extension and Promotion services.

LITERATURE CITED Coughlan, Anne T., Erin Anderson, Louis W. Stern and Adel I. El-Ansary, (2005), Marketing Channels, 6th Edition, Pearson Education, Delhi, India, pp 7-11. Czinkota, M. R. and Masaaki Kotabi (2002), Marketing Management. 2nd Edition. Thomson Asia Pvt Ltd., Singapore, pp 339-353. Janakiraman, B. and R. K. Gopal. Total Quality Management Text and Cases. First Edition., Prantice Hall India, New Delhi, 2006, pp181-191. Kotler, P., K. L. Keller, A. Koshy and M. Jha, (2007), Marketing Management A South Asian Perspectiv, 12th Edition, Pearson Prentice Hall, Delhi, India, pp 398-401. Mukherjee, P. N. (2006), Total Quality Management. First Edition, Prantice Hall India.. New Delhi, India, pp 119-126. http://www.jnkvv.nic.in/IPM%20Project/weedmanagement1.html#Cultural_Control www.jnkvv.nic.in/IPM%20Project/weedsoybean.html www.sopa.org/Ist%20Estimate.doc

(Signature of Student)

CERTIFICATE The members of Advisory Committee of Amit Sharma met on 05/05/2010 in which the candidate presented in the form of seminar, the synopsis of his project work entitled Evaluation of Distribution Network of Forage Seed Companies in Western Haryana to be carried-out for MBA (Agri Business). After discussion the committee has recommended the synopsis for approval. Name and Designation Dr. Rajesh Sharma Associate Professor, IABM, S.K.R.A.U Dr. Madhu Sharma Associate Professor, IABM, S.K.R.A.U Dr. S.K. Sharma Director of Extension, DEE, S.K.R.A.U Dr. S.K. Johri Assistant professor, COA, S.K.R.A.U I have examined the above synopsis and recommend that it may be approved Major Advisor/Member Major Advisor Member Member Member 2000-02-04-11 2000-02-04-12 94-08-04-01 2000-15-04-22 P.G. Code No. Signature

Date: DIRECTOR, IABM

The synopsis is hereby approved / not approved / to be revised.

DEAN, PGS

How many distributers are in the Territory of your company? Whats the age of your firm? Sales ? Turn over ? Push/ pull? Time of distributorship? Tehsil covered > Retailers covered? Display quality?