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Transcript of Bajaj Almond
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BAJAJ CORP LTD.Presentation on Sales trainingPory Medhi
DraftFCB+Ulka
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Company Background
Bajaj Corp Ltd is one of Indias leading FMCG company with major
brands in Hair care category, with brands that have been in themarket for eight decades.
Part of Bajaj group (Sugar, Consumer Goods, Power Generation and
Infrastructure Development). Subsidiary of Bajaj Consumer Care Ltd.
BCL is the exclusive licensee of brands owned by BCCL, licensed for99 yrs from 2008.
3rd largest on overall hair oils segment.
Almond Drop Hair Oil- 50% in light hair oils, highest per unit pricesdue to premium positioning.
New product- Kailash Parbat Thanda Tel.
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Industry Overview
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Organisation Hierarchy
Chairman
Mr Kushagra Bajaj
President
OperationsMr. Apoorv Bajaj
CFO
Mr Dilip Maroo
Director Sales
& MarketingMr. Sunil Malhotra
GM- Sales
Mr. Sudhir Taneja
GM-Marketing
Mr. Gurpreet S. Amrit
GM- HR
Mr. S Chatterejee
ViceChairmanMr. R F Hinger
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Brands Worked OnADHO is the market leader in the
LHO category with 55% MS
Main competition from HimamiNavratna (Market leader, 39% MS),
Himgange, Jagat etc
Dabur Amla is the market leader with67% MS
ADHO sachets and 500 ml PET bottlewere the focus brands
KPTT expected to grab 3% MS byyear end
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NPD Strategy
Strategy was to increase the product portfolio and reduce thedependency on ADHO
Cooling hair oil segment is the fastest growing by volume in overall hairoil category.
In FY11 it grew by 16.2% on YoY basis against overall hair oil industrygrowth rate of 12.3%.
Only one national player i.e Navratna by Himani with market share of39% unlike Bajaj ADHO, which has 55% market share in LHO categoryand Dabur Amla with 67% market share in Heavy Amla category.
The category is in nascent stage in most of the states in India except forUP, Bihar, Jharkhand and Chattisgarh while Bajaj Corp has decentdistribution network all over India.
High gross profit margin at ~55% similar to ADHO.
The management expects the product to break even by achieving 6%market share in second year from launch.
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Distribution Process
Factory
Own HP-2, UK-1Third Party HP-1, Raj-1
Central Warehouse-1
Regional Distribution
Centre (C/F) 32
URBAN
Stockist
Retailer
RURAL
Stockist
Wholesaler
Retailer
The company reachesconsumers through 1.95 millionretail outlets serviced by 5653direct distributors and 9900wholesalers
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Sales Process
Hierarchy
GM Sales
INDIA
AGM Sales
2-3 REGIONS
Regional SalesManager
1 REGION
Area SalesManager
1-2 DISTRICT/CITY
Sales officer
5-10 TOWNS
ISR
1 TOWN
AGM ModernTrade
2-3 REGIONS
Terminology
PJP and DRCP Mumbai- 360 beats Each ISR- 12-15 beats Each Beat- 40-50 shops 40 shops- short beat 50 shops- long beat One day- 50 shops
Atleast 25 productivecalls/day Repeat after 15 days LPC/BPC
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Sales Planning Process
Infrastructure Planning- Deciding the beats, routes and noof ISRs needed
Production Planning AOP/ QOP
Forecasting is done bottom up based on past trends andcompetitions performance
Target Planning- Given in the no. of cases. Target for2011-12 is 48001 cases
KP Target forecasting: Net loss of 7 crores, 6% marketshare to break even next year
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Flow
Paper flow-Credit notes are given to stockists by thecompany to meet expenses which include godown cost,delivery cost, ISR salary etc. Invoices are made for everyorder.
Material flow- Material flows from Factory to hub to C&F tostockist and to retailer.
Damaged goods are either replaced or payed for againstclaims made as asked by stockist.
Cash flow- Orders given by stockists and payments madein cash/DD.
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Sales ProcessProspect
Approach (OpenDialogue)
Need Assessment
Demonstration
Meeting Objections/Handling Complaints
GainingCommitments
Follow up
Sales Kit: DSR- Daily Sales
Report Product Folder
AdvertisementSchedule ADHO, KP Sachets-
Ready Stock Sampling Bottle- KP
POP Material- KP Calculator Diary
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Sales CyclePrimary
Companysells to theStockist
Secondary
Stockistsells toRetailer
Offtake
Retailer toConsumers
(Opening Stock + Primary) Secondary = Closing Stock
Primary Depends on: Opening Stock
Running Rate Seasonality Offers/Schemes/Incentive/Bonus Manpower strength
*Primary Cycle 10th, 20th, 30th of each month (each Deek)
Secondary Cycle 6th-15th, 16th-25th, 26th-5th of each month12
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SKU Pricing & PackingBRAND/SKU
3ml 20ml 50ml 75ml 100ml 200ml 300ml
ADHOPc/ Case
MRP:Re 11600
Rs 10144
Rs 2560
Rs 3640
Rs 4640
Rs 8525
Rs 11016
KPTT MRP:Re 11600
Rs 25120
Rs 4860
Rs 8236
BAHO MRP:Re 11000
Rs 18120
Rs 3460
Rs 6536
Rs 9024
BASHO Rs 12120
Rs 2360
Rs 3936
JHO Rs 18
120
Rs 34
60
Rs 65
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*Note: Company recently launched a 500 ml PET bottle for ADHO and tryingto gauge the response of the consumers towards plastic bottles
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MRP Calculation
Company Billing Rate
VAT @ 12.5 %
Landed Cost toStockist
Stockist Margin @5%
VAT Credit byStockist
Billing by Stockist
Landed Cost toRetailer
Retailer Margin @10%
MRP
83.71*
10.46
94.17
5.18
0.65
99.35
100
10
110
* Pricing illustrated for 300 ml
ADHO
Stockist Margin = 5%Retailer Margin = 10%
Additionally,Cash Discount = 1.25%(Stockist)
Trade scheme for 300mlADHO:
Billing Qty =46Scheme Qty = 2% scheme = 4.30%
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Trade Schemes
Primary Scheme:
I. Scheme passed directly in the bill, it can increase sales upto1.05-1.75 times.
II. It changes from month to month.
Eg: 3 cases free on a bill of 100 cases of 100ml ADHO
Secondary Scheme:
I. Scheme reimbursed to the stockist for doing secondary sales, itcan increase sales upto 1.45-1.5 times.
II. Offer once in 6-12 months.
Eg: 3% of the value of secondary sales done is reimbursed
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Incentives
ISR
I. Bill Cut incentive- Rs 3/ bill of Rs 150 for KP
II. Sales incentive- Rs 500/ 15 Cases for KP
RSM
I. Top 2 to achieve targets get Rs 15000/ Rs 10000
Stockist
I. Target Based Incentive- Trip to Thailand for 10000 cases
II. Turnover Based Incentive- Quaterly: 0.7% of turnover
Annually: 0.4% of turnover
Wholeseller
I. Royal Bajaj Club- Bronze, Silver, Gold, Platinum, Diamond, DirectorsClub, Debit card, Laptop etc.
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Competition Pricing
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BRAND/SKU
3ml 20ml 50ml 75ml 100ml 200ml 300ml 500 ml Scheme
ADHO Re 1 Rs 10 Rs 25 Rs 36 Rs 46 Rs 85 Rs 110 Rs 185
KPTT Re 1 Rs25 Rs 48 Rs 82
Navratna Re 1 Rs 27 Rs 50 Rs 85 Rs 115 Rs 195 6%
Himgange Re 1 Rs 25 Rs 47 Rs 78 Rs 185
BAHO Re 1 Rs 18 Rs 34 Rs 65 Rs 90
Dabur Amla Rs 17 Rs 34 Rs 67 Rs 95 3%
Keo karpin Rs 15 Rs 35 Rs 65 Rs 90 3%
H&C Rs 20 Rs 35 Rs 64 Rs 92 2%
BASHO Rs 12 Rs 23 Rs 39
Shanti Amla Rs 10 Rs 20 Rs 34 Rs 60 3%
JHO Rs 18 Rs 34 Rs 65
Parachute
Jasmine
Rs 15 Rs 31 Rs 59 Rs 85 2%
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Sales Promotion
Consumer Offer: Colgate Active Salt Toothpaste free with200 ml ADHO
KPTT activation exercise: Standees outside Barber Shopsand distribute free KP sachets to clients coming formassages
POP Material: Danglers, Flags, Dispensers, BackingSheet, Poster, Hangings, Gondolas etc
TV Ads
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Observations
Cooling hair oil sales are highly influenced by demographics andseasonality
Navratna has very strong brand recall due to celebrity endorsementsby Mr Amitabh Bachchan, Mr Shahrukh Khan etc
Retailers are not to happy with the margins offered by Bajaj, ask forschemes and offers
Inspite of the KP ads, the demand has not increased
The new ADHO 500 ml PET bottle does not have a proper cap lock
KP not kept with category or within line of sight
On occasion orders have been placed but not delivered
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Recommendations
More demonstrations to retailers and near barber shops to induce trial
ISR should highlight all the Points of Parity and Points of Difference ofKP
Prompt delivery of orders
Highlight the benefits of placing orders directly with the companyrepresentative wrt damaged goods replacement
Do not dump products
Ensure proper placement within correct category and visibility
Proper merchandising and POP material
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THANK YOU
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