PROJECT REPORT ON

THE GAP ANALYSIS IN SALES AND DISTRIBUTION OF

FEM PRODUCTS RELATING TO MODERN TRADE

SUBMITTED TO

Dabur India Limited

Kaushambi, Ghaziabad – 201010

Uttar Pradesh, India

&

BIRLA INSTITUTE OF MANAGEMENT TECHNOLOGY

GREATER NOIDA

BY

JITESH KHANNA

09DM049

2010

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Declaration

I Jitesh Khanna, student of Birla Institute of Management Technology, Greater Noida hereby declare that project entitled “The gap analysis in sales and distribution of FEM products relating to Modern Trade” is original work done by me under the guidance of Mr Ankur Jain Area Head Modern Trade (North Zone II) Dabur India Ltd. and Prof. Masilamani, Faculty, BIMTECH. The information provided in the study is authentic to the best of my knowledge. All care has been taken to make this report error free and I sincerely regret for any unintended discrepancies that might have crept into this report. I shall be highly obliged if errors (if any) be brought to my attention.

Thank You

Jitesh Khanna

PGDM – 09DM049

Jitesh.khanna11@bimtech.ac.in

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Acknowledgment

In Indian culture, a task is said to be incomplete without the blessings of almighty and elders. Also acknowledging the work and help of all those who have guided me for the completion of my research on time.

I am deeply indebted to Mr Ankur Jain Area Head Modern Trade (North Zone II) Dabur India Ltd. and my faculty mentor Prof. R J Masilamani for not only providing me with the opportunity for this study, but also enthusing me to work on this very meaningful subject. I am also grateful for the cooperation and valuable support given to me by the employees of the organization throughout my training.

Their constant encouragement was a source of strength for me in pursuing this work.

I express my deep sense of gratitude and reverence for my parents and my dear friends for their endless love, guidance, moral support, encouragement and untiring cooperation throughout my study and work, without which this work would never have been completed.

I express my sincere thanks to all those who helped me in my training. Still, I feel I have not been able to express my gratitude to all of them, as no words can thank them for their teachings and love shown towards me.

Regards

Jitesh Khanna

PGDM – 09DM049

Jitesh.khanna11@bimtech.ac.in

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Summer Project Certificate

This is to certify that Mr Jitesh Khanna Roll No. 049 a student of PGDM has worked on a summer project titled “The gap analysis in sales and distribution of FEM products relating to Modern Trade” at Dabur India Limited after Trimester-III in partial fulfilment of the requirement for the Post Graduate Diploma in Management programme. This is his/her original work to the best of my knowledge.

Date: ___________ Signature ________________

(_________________________)

Name of Industry Mentor

Company Seal

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Summer Project Certificate

This is to certify that Mr Jitesh Khanna Roll No. 049 a student of PGDM has worked on a summer project titled “The gap analysis in sales and distribution of FEM products relating to Modern Trade” at Dabur India Limited after Trimester-III in partial fulfilment of the requirement for the Post Graduate Diploma in Management programme. This is his/her original work to the best of my knowledge.

Date:___________ Signature ________________

(_________________________)

Name of Faculty Mentor

BIMTECH SEAL

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Table of Contents

Executive Summary 8

Overview of FMCG Sector in India 10 Introduction 13

Company Profile 14 Introduction to Dabur 15 Dabur Over Years 18 Corporate Philosophy 22 Location of Operations 23 Company Business Activities 25 Dabur Manufacturing facilities in India 26 Dabur worldwide 27 About FEM 28

About the Project 30 FEM Product Portfolio 34 Competitors of FEM 43

Organization Structure 49 Project Analysis 52

First Part Distribution network of Dabur 54 Distribution process of Dabur in Modern Trade 57 Data Presentation 60 Gaps 71

Second Part Sale Promotion 74 Sale Promotion done by competition 77 Data Presentation 78 Findings 101

Recommendation Part 1 105 Part 2 107

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Conclusion 109 References 110 Bibliography 111 Annexures

Annexure 1 113 Annexure 2 114 Annexure 3 115 Annexure 5 116 Annexure 5 117 Annexure 6 118 Annexure 7 119 Annexure 8 120 Annexure 9 121 Annexure 10 122 Annexure 11 123

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Executive Summary

Dabur India is one of the leading FMCG Companies in India. The project I undertook is‘Gap analysis of FEM products in sales & distribution across all national & regional chain modern trade stores in Delhi, NCR (includes Gurgaon, Faridabad, Noida & Ghaziabad).The study objectives were:

Identify gaps in distribution, assortment, MBQ levels of FEM products in

these stores within the following categories a) Bleach b) Hair Removal Cream c) Liquid Soaps

ii) Study promotion/activation mix for these categories done by

competition’ was undertaken was undertaken for duration of two monthsas a part of the learning process during the summer training at Dabur India Ltd.

The main objective of this project is to identify the loopholes that exist in the current distribution, MBQ levels and assortment of FEM products and the various methods of sale promotion that can result in incremental sales of FEM products in modern trade.

To study the first part, various modern trade outlets and their central distribution centers were visited. interviews were conducted with them to know what kind of challenges are faced by them as regards to FEM. Some of the loopholes that came forward are Fill rate being less than 65%, retailers only prefer keeping fast moving SKUs thereby neglecting the other SKUs. Replenishment at times takes more than the stipulated period of delivery. MBQ levels are constant irrespective of their demand in the market. Footfall of the store is not considered while deciding the MBQ. Dabur offers very low margins to the retailers.

To solve these problems various suggestions have been mad. For instance to handle low fill rate, unavailability of one SKU can be substituted by making available more units of another SKU of the same product. Special schemes should be provided to retailers on sale of slow moving SKUs. Special norms should be created for timely supply of orders, MBQ level should be decided as per the footfall in a particular week of a store. Motivation should be given through various incentive schemes to the distributors, retailers and salesman to keep up the sale of FEM.

In the second part, a survey was conducted in different modern trade outlets. In total 152 people responded to the survey. Most of them were women in the age group 18-35. Findings from the survey were that most people think major part of the promotion is done

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through consumer promotion schemes. People are satisfied with the pricing of FEM, since FEM promotion is not consistent not many people have bought FEM under promotion. Most people prefer monetary schemes over non-monetary schemes. People prefer to try a skin care product before using it.

All the 3 categories of FEM naming Bleach, hair remover and liquid hand wash were put on the product life cycle stage, and my observations were that while hair remover falls in the introductory stage, bleach and liquid hand wash comes in the growth stage. Hair Remover needs more advertising. Personal selling and trial packs should be encouraged. Bleach and Hand Wash needs advertising, sale promotion and personal selling but above all it is dependent on word of mouth the biggest promotion tool.

It was an excellent experience while working with Dabur India limited. I learnt about the environment and culture of the organization, its distribution structure; which I feel will help me in my future endeavours in life.

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OVERVIEW OF FMCG SECTOR IN INDIA

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The Indian FMCG sector is the fourth largest sector in the economy with a total market size in excess of US$13.1 billion. It has a strong MNC presence and is characterised by a well-established distribution network, intense competition between the organised and unorganised segments and low operational cost. Availability of key raw materials, cheaper labour costs and presence across the entire value chain gives India a competitive advantage. The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4billion in 2015. Penetration level as well as per capita consumption in most product categories like jams, toothpaste, skin care, hair wash etc. In India is low indicating the untapped market potential. Burgeoning Indian population, particularly the middle class and the rural segments, presents an opportunity to makers of branded products to convert consumers to branded products. Growth is also likely to come from consumer 'upgrading' in the matured product categories. With 200 million people expected to shift to processed and packaged food by2010, India needs around US$ 28 billion of investment in the food-processing industry.

India is one of the largest emerging markets, with a population of over one billion. India is one of the largest economies in the world in terms of purchasing power and has a strong middle class base of 300 million. Around 70 per cent of the total households in India (188 million) reside in the rural areas. The total number of rural households is expected to rise from 135 million in 2001-02 to 153 million in 2009-10. This presents the largest potential market in the world. The annual size of the rural FMCG market was estimated at around US$ 10.5 billion in 2001-02. With growing incomes at both the rural and the urban level, the market potential is expected to expand further.

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Rural-urban profile

Source: Statistical Outline of India (2008-09), NCAER

An average Indian spends around 40 per cent of his income on grocery and 8 per cent on personal care products. The large share of fast moving consumer goods (FMCG) in total individual spending along with the large population base is another factor that makes India one of the largest FMCG markets.

Urban Rural

Population 2001-02 (mn household) 53 135 Population 2009-10 (mn household) 69 153 % Distribution (2001-02) 28 72 Market (Towns/ Villages) 3768 627,000 Universe of Outlets (mn) 1 3.3

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INTRODUCTION

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Company Profile

Dabur India Limited came into existence over 100 years ago in 1884 in Calcutta.

The founder of Dabur India Limited-Dr.S.K.Burman (1856-1907) was a physician who brought Ayurvedic medicines for the masses of Bengal. His off quoted dictum is the guiding spirit behind Dabur even today:

"What is the life worth which cannot bring comfort to others"

And the Vision of DIL is:

"Dedicated to the health and well-being of every household"

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Introduction to Dabur

Dabur India Limited came into existence over 100 years ago in 1884 at Calcutta. The founder, Dr.S.K.Burman, was a practicing allopathic doctor. At that time Malaria, Cholera and Plague were the common diseases. He was a physician who brought Ayurvedic medicines to the masses of Bengal. Initially established as a proprietary firm for the manufacture of chemicals and Ayurvedic drugs it was later on 19th November 1930 incorporated as private limited company. Late Shri C.L.Burman, son of late Dr S.K. Burman and his son late Shri P.C.Burman in the name of Dr S.K.Burman Pvt. Ltd. to expand the operations by setting up production facilities at Garia and Narendrapur, West Bengal and Daburgram, Bihar.

Dabur (Dr.S.K.Burman) Pvt. Ltd. was merged with Vidogum and Chemicals Ltd. w.e.f. 1st July1985 and the amalgamated company was renamed DABUR INDIA LIMITED and a fresh certificate of incorporation was issued to that effect. In 1970, the bulk of manufacturing facilities were shifted from West Bengal to Faridabad in Haryana.

In 1975, vidogum and chemicals were incorporated in technical collaboration with Unipekin AG (Switzerland) for the manufacture of edible grade and industrial grade Guargum powder at Alwar in Rajasthan.

In 1977, a modern automated plant was set up in Sahibabad (U.P.) for the manufacture of Chyawanprash, Asavrishthas, Hair oil, Tooth powders, Hajmola, and other Ayurvedic specialties. Certification for production of toiletries and food grade products was issued on 13th October 1986 by the registrar of Delhi and Haryana to the company, Dabur Private Limited, a closely held Public Limited Company.

It was incorporated as a Private Ltd. Company in the name of Dabur (Dr S.K.Burman) Pvt. Ltd. From a humble beginning in 1884, a manufacture of traditional medicine in Calcutta, Dabur has come a long way to become a multifaceted multinational, multi-product, modern Indian corporation with a global presence. It now enjoys the distinction of being the 2nd largest FMCG Company and is praised to become a true Indian Multinational.

The main plant was set up in Sahibabad (U.P.) in 1977 for manufacturing of Chyawanprash, hair oil, tooth powder, Hajmola and other Ayurvedic medicines and food products etc. Dabur's main line of business is in the sphere of Health care, Personal care and Beauty care. Its strength lies in natural and herbal preparations.

Dabur's corporate philosophy has always been ahead of its time. The founder's initial success was mainly due to his direct main campaigns- a technique that became very popular nearly a century later. The company was one of the earlier Indian companies to have fully equipped R & D lab as early as in 1919. Today, the company has its own mainframes and computers are a way of life here.

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Dabur is also an ISO 9002 certified company. The certification was obtained in 1995 by SGS YARSLEY international services Limited U.K. Dabur's revenue today exceed Rs.800 crores with plans to achieve Rs.2, 000 crores by year 2003. Dabur has 34,000 shareholders with market capitalization of over Rs.1, 400 crores.

Dabur has 11 manufacturing plants in India and Nepal and a licensee in the Middle East. It has manufacturing base in Egypt also. The company has over 4,000 employees with around 1,500 looking after sales and marketing functions.

The Indian market is being served through a transactional network of sales offices and carrying and forwarding agents. The company has its offices in London, New York and Moscow. Dabur products are being exported to around 50 countries. Dabur portfolio is exceeding 500 products of FMCG and health care products.

The Board of Directors of Dabur India Limited (DIL) met on July 23, 2003 to consider the unaudited financials of the company for the first quarter that ended on June 30, 2003. Company has recorded a growth of 36 per cent in its net profit per cent growth in its turnover during April-June 2003.

The turnover of DIL, during the three-month period, has increased to Rs 266 crore to Rs 300 crore while the net profit has increased 11.5 crore to Rs 16 crore during the same period.

The first quarter results should not be annualized as sales usually improve in subsequent quarters.

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Dabur Vision “Dedicated to the health and well-being of every household” Dabur is a company with a set of established business values, which direct it's functioning as well as all its operations. The guiding forces for Dabur are the words of its founder, Dr .S. K. Burman, "what is that life worth that cannot give comfort to others." The Company offers its customers, the products to suit their needs and give them good values for money. The company is committed to follow the ethical practices in doing business. At Dabur, nature acts as not only the source of raw materials but also an inspiration and the company is committed to product the ecological balance.

The vision is intertwined with below mentioned core values of the company:- Ownership: This is our company. We accept personal responsibility, and accountability to meet business needs.

Passion for Winning: We all are leaders in our area of responsibility, with a deep commitment to deliver results. We are determined to be the best at doing what matters most.

People Development: People are our most important asset. We add value through result driven training, and we encourage & reward excellence.

Consumer Focus: We have superior understanding of consumer needs and develop products to fulfil them better.

Team Work: We work together on the principle of mutual trust & transparency in a boundary-less organization. We are intellectually honest in advocating proposals, including recognizing risks.

Innovation: Continuous innovation in products & processes is the basis of our success. Integrity: We are committed to the achievement of business success with integrity. We are honest with consumers, with business partners and with each other.

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Dabur Over The Years

More than a century ago, a young doctor started with a vision to provide innovative and affordable health care products to Indian masses. Thus, was born an organisation today known as Dabur India Limited. The twelve hundred crores corporate today started with a small dispensary at Calcutta, the noble thoughts of Dr.S.K.Burman being the main source of inspiration behind the project. From that humble beginning, the company has grown into India’s leading manufacturer of consumer health care, personal care and food products. This phenomenal progress has seen many milestones, some of which are mentioned below:

1884: Dr.S.K.Burman lays the foundation of what is known as Dabur India Limited.

Started from a small shop at Calcutta, he began a direct mailing system to send his medicines to even the smallest of villages in Bengal. The brand name Dabur is derived from the words "DA" for Daktar or doctor and "BUR" from Burman.

1896: As the demand for Dabur products grows, Dr Burman felt the need for mass

production for some of his medicines. He set up a small manufacturing plant at Garhai near Calcutta.

Early 1900s: The next generation of Burman’s takes a conscious decision to enter the

Ayurvedic medicines market, as they believe that it is only through Ayurveda that the healthcare needs of poor Indians can be met.

1919: The search for processes to suit mass production of Ayurvedic medicines

without compromising on basic Ayurvedic principles lead to the setting up of the first Research and Development laboratory at Dabur. This initiates a pain staking study of Ayurvedic medicines as mentioned in age old scriptures, their manufacturing processes and how to utilize modern equipment to manufacture these medicines without reducing the efficacy to manufacture these medicines without reducing the efficacy of these drugs.

1920s: A-manufacturing facility for Ayurvedic Medicines is set up at Narendrapur and Daburgram. Dabur expands its distribution network to Bihar and northeast.

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1936: Dabur India (Dr S.K.Burman) Pvt. Ltd. is incorporated.

1940: Dabur diversifiers into personal care products with the launch of its Dabur Amla Hair Oil. This perfumed hair oil catches the imagination of the common man and film stars alike and becomes the largest hair oil brand in India.

1949: Dabur Chyawanprash is launched in a tin pack and becomes the first branded Chyawanprash of India.

1956: Dabur buys its first computer. Accounts and stock keeping are one of the first operations to be computerized.

1970: Dabur expands its personal care portfolio by adding oral care products. Dabur Lal Dant Manjan is launched and captures the Indian rural market.

1972: Dabur shifts base to Delhi from Calcutta. Starts production from a hired

manufacturing facility at Faridabad.

1978: Dabur launches the Hajmola tablets. This is the first time that a classical Ayurvedic medicine is branded from Shudhabardhak bati to Hajmola tablets.

1979: The Dabur Research Foundation (DRF), an independent company is set up to spearhead Dabur's multi-faceted research. Commercial production starts at Sahibabad. This is one of the largest and most modern production facilities for Ayurvedic medicines in India at this time.

1984: The Dabur brand turns 100 but is still young enough to experiment with new offerings in the market.

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1986: Dabur becomes a public Limited company through reverse merger with Vidogum Limited, and is re-christened Dabur India Limited.

1989: Hajmola Candy is launched and captures the imagination of children and establishes a large market share.

1992: Dabur enters into a joint venture with Agrolimen of Spain far manufacturing and marketing confectionery items such as bubble gums in India.

1993: Dabur set up the oncology formulation plant at Baddi, Himachal Pradesh.

1994: Dabur India Limited comes out with its first public issued at a premium of

Rs.85 per share. The issue is subscribed over 21 times.

1994: Dabur enters the oncology (anti-cancer) market with the launch of Intaxel

(Pacitaxel). Dabur becomes only the second company in the world to launch this product. The Dabur Research Foundation develops the unique eco-friendly process of extracting the drug from the leaves of the Asian Yew Tree.

1995: Dabur enters into a joint venture with Osem of Israel for food and Bongrain of

France for cheese other dairy products.

1996: Dabur launches Real fruit juices, which heralds the company's entry into the processed food market.

1997: The foods division is created, compromising of real fruit juices and Homemade cooking paste to form the core of this division's product portfolio.

1998: Project STARS (Strive to Achieve Record Successes) is initiated by the company to achieve accelerated growth in the coming years. The scope of this project is

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strategic, structural and operational changes to enables efficiencies and improves growth rates.

1998: The Burman family hands over the reins of the company to a professional, Mr

Ninu Khanna join Dabur, as the Chief Executive Officer.

1999-2000: Dabur achieves the Rs.1000 crores turnover mark.

2001-2002: Launched Amla Light, new flavors in Real Juices-grapes, guava, apple active, orange active, homemade pappad, Vatika- an anti-dandruff shampoo.

2002: New launches homemade coconut milk (in south), Tang, Tomato puree, Vatika light.

2003: Dabur achieves Rs.1, 232 crores turnover mark with an increase of 6 per cent. Turnover of FMCG reaches to Rs l048.5crores, which shows a profit of Rs. 72 crores. Turnover of pharmaceuticals reaches to Rs 184 crores with a profit of Rs.13 crores.

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Corporate Philosophy

Knowledge is the key to growth in today's world. Whatever be the industry, it i s the knowledge, which provides cutting edge to individual and organisations. For more than a century nature has been a rich source of knowledge for DABUR. Nature has not only gives it the ingredients for all its products but also has taught it how to create a harmony withi n and outside the organisation. Nature has inspired DABUR in all its acts. Ayurveda - the science of life is based on principles of nature. All Ayurvedic preparation has their ingredients derived from nature. Dabur has converted the healing properties of natural ingredients and the age-old knowledge of Ayurveda into contemporary health care to eliminate health problems of its consumers.

Dabur is committed to expand the reach of its age-old knowledge of Ayurveda and Nature through web. Through web the aim is to overcome the physical boundaries to take Ayurvedic way of life to global frontiers. Dabur India limited understands its responsibility as a corporate house. It has not only set a sight on increasing turnover and profitability of the company but also on propagating Ayurveda - The Indian System of Medicine.

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Locations of Operations

Head office: Sahibabad, Ghaziabad (U.P.)

Regd. Office: Asaf Ali Road, New Delhi

Corporate office: Kaushambi, Ghaziabad (U.P.)

Sales & Marketing: New Delhi

OFFICES:

Chandigarh (H.P.), New Delhi (Delhi), Jaipur (Rajasthan), Kanpur (U.P.), Patna (Bihar), Ahmadabad (Gujarat), Indore (M.P.), Cuttack (Orissa), Mumbai (Maharashtra), Hyderabad (A.P.), Chennai (Tamil Nadu), Bangalore (Karnataka), Kochi (Kerala), Guwahati (Assam), Kathmandu (Nepal), Russia, U.K.

FACTORY:

Baddi (H.P.), Ghaziabad (U.P.), Alwar (Rajasthan), Daburgram (Bihar), Kalyani& Narendrapur (West Bengal), Katni (M.P), Birgunj (Nepal), Egypt.

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Clearing & Forwarding Agent (C&Fa):

Jammu, Chandigarh (HP) Ambala (Punjab), New Delhi (Delhi), Ghaziabad (U.P.), Dehradun (U.P.), Lucknow (UP), Ranchi, Patna (Bihar), Guwahati (Assam), Calcutta (West Bengal), Jaipur (Rajasthan), Ahmadabad (Gujarat), Indore (M.P.) Raipur (M.P.), Bhubaneswar (Orissa), Cuttack (Orissa), Mumbai (Maharashtra), Hyderabad (A.P.), Chennai (Tamil Nadu), Bangalore (Karnataka), Cochin (Kerala).

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The Companies Business Activities Comprises of; HEALTH CARE PRODUCTS: Markets a range of OTC health care: products based on Ayurveda, some of its products like Chyawanprash, Hajmola, Hajmola Candy, Pudinhara are market leaders with over 65 per cent market share in their respective categories.

PERSONAL CARE PRODUCTS: It includes hair care, oral care and honey. Dabur Amla as a brand has made its mark beyond India; it is a leading hair oil brand in Middle East and Africa. Other well-known brands are Vatika, Dabur Lal Dant Manjan.

AYURVEDIC SPECIALITIES: There is a range of over 400 Ayurvedic medicines. It has vast range of classical Ayurvedic drugs and priority Ayurvedic medicines developed by own R&D.

PHARMACEUTICAL DIVISION: It includes a range of natural ethical products like Livfit, Lionitus, Legal etc., and angel of contract media and gynaecological. This division has a major presence in Anti-thrombolytic, Anti-migraine therapy and radio opaque dyes.

ONCOLOGY: The formidable range includes brands such as Intel, Docetaxel that were manufactured in India for the first time by Dabur. The company is a market leader in this category in India and plans to establish itself as a general Oncology player in selective global market.

BULK DRUGS AND CHEMICALS: Dabur manufactures synthetic and semisynthetic bulk pharmaceutical substances, bulk natural compounds and intermediaries. Isolation of pure natural compounds and custom synthetics are focus areas.

FOODS DIVISION: One of the youngest divisions of the company markets a range of sauces, ethnic pastes and foods. Real fruit juices gave Indian consumer for the first time, fruit juices with nothing artificial, no preservatives, no colour and no flavours added. Launched two years back, the range includes Real Juices and cooking pastes under the brand name Home Made.

NATURAL GUMS: This division manufactures and process Guar gums, Gum Karaya, tamarind based gums and psyllium husk. The division produces a range of industrial and grade natural gums to meet the customer specifications.

AYURVEDIC VETERINARY: It deals exclusively in animal hea1thcare. Markets safe and non-toxic herbal veterinary products for poultry.

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Dabur Manufacturing Facilities in India

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Dabur World Wide

Dabur's mission of popularising a natural lifestyle transcends national boundaries. Today there is global awareness of alternative medicine, nature-based and holistic lifestyles and an interest in herbal products. Dabur has been in the forefront of popularising this alternative way of life, marketing its products in more than 50 countries all over the world.

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About FEM

Fem is trusted brand known throughout India since 1982. The company markets bleach, liquid soaps and hair removing creams under the ‘Fem’ brand.In house R&D: innovative products like Oxybleach (premium cream bleach), Fem Stratum (hair conditioner), Saka (men’s bleach) and Botanica (skin firming& anti-wrinkle cream) introduced in the last few years. It has a range of fabric softeners and stain removers under the brand ‘Bambi’. Markets a range ofpharmaceutical products in dermatology and other segments. Distributions reach covering 1, 25,000 retail outlets; also covers 25,000 parlours directly. Manufacturing facilities in Nasik and Baddi (HP); Baddi unit which was set up in 2006 enjoys both excise and IT benefits. Exporting to UAE, Yemen, Oman, Maldives, Mauritius, Malaysia, Sri Lanka, Bangladesh, Myanmar and Nepal. Owns the brand ‘Jaquline’ which markets women care products (bleach andhair removing creams) in US and Middle East. Highly profitable company with gross margins of over 60%.

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Acquisition of Controlling Stake in Fem Care Pharma Ltd by Dabur India Ltd (DIL)

Dabur India Limited signed an agreement to acquire 72.15% stake from the existing promoters.

The transaction values FCPL at an equity value of Rs 282.4 crores. Dabur to make an open offer to acquire further 20% of the FCPL’s equity share

capital. Specialty chemicals division and some other investments will be bought over by

promoters at book value or market value whichever is higher. Acquisition to be funded through internal accruals of Dabur India Ltd.

Acquisition Rationale

Revenue Synergies Brand provides access to DIL into fast expanding skin care market at mass price points Higher reach/penetration for FCPL portfolio through DIL’s distribution network

Potential for extending FEM brand into other related skin care categories.

Potential in International markets: FEM & Jaquline brands have presence in GCC/Middle east markets which can be expanded.

FCPL’s parlour outreach to be leveraged for promoting Dabur’s personal care portfolio. Cost Synergies

Combined business to unlock synergies : Sales & Distribution, Marketing, Supply Chain, Sourcing & Manufacturing

FCPL’s Baddi unit synergistic with DIL’s own skin care plans Greater efficiencies possible in trade and distribution Combined Adpro spends can be leveraged to reduce media costs FCPL’s R&D knowledge in skin care to supplement domain knowledge for DIL

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ABOUT THE PROJECT

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Fem Care Pharma Ltd, which has a leadership position in the fairness bleach category and a strong market position in hair removal and liquid soap category. The other brands in its portfolio include Oxybleach cream, S K men’s bleach and Bambi fabric softeners.

cquisition of Fem Care Pharma is in line with strategy to aggressively expand Dabur’s scale

of operations and strengthen its presence in the fast moving consumer goods (FMCG) space. This transaction would give Dabur an entry into the high-growth skin care market with an established brand name ‘FEM’. Further, Dabur also has the potential to extend the brandinto newer and related skin care categories.

But since the acquisition has taken place, Dabur has not been able to concentrate much on the distribution and promotion aspect of FEM. FCPL which continued to keep the distribution of FEM products in OFOs and Kirana Shops while Dabur has taken over the distribution of FEM products in Modern Trade. I was given the task of identifying loopholes that exist in the Distribution and Promotion strategy of FEM across all national and regional chain modern trade stores in Delhi and NCR.

Part 1 of the project First part of the project is to study the gaps in distribution, assortment and MBQ levels of FEM product in modern trade stores within the product category naming;

Bleaches

Liquid Soaps Hair Removal Cream

Since sales and distribution are one of the most important areas of a company, this problem has to be seen from all the angles before coming to any conclusion. To study the problem of MBQ levels and Assortment, I had visited some branches of modern trade retails stores and their distribution centre. Interview was conducted with the store managers, departmental heads and Dabur’s promoters in these chains about the problems faced related todistribution strategies because of company or retail house.

List of Modern Trade Retail Chains where FEM products supplied are:

Big Bazaar Big Apple Vishal Mega mart REI 6TEN Surya Healthcare Apollo Pharmacy

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Guardian Pharmacy Religare Spencer H&B Store Home Store

Part 2 of the project Second part of the project is study of the promotion mix being done by the competitors which will increase the sale of the above mentioned 3 FEM products without causing any disturbance in the various channels of distribution.

Since promotion not only leads to increase in the sale of the product but also increase brand awareness among the buyers, promotion has become a significant tool being used by the marketers for not just survival but also leading this highly competitive market.

There are different kinds of promotional schemes used by different companies to market their products. While some companies depend on monetary schemes other use non-monetary schemes very significantly. To test which one of them is mostly preferred by the consumers, I conducted a survey to see what kind of scheme makes a consumer inclined towards buying that product.

Methodology Adopted

For 2nd part of this project, the method available was to get enough information through personal interaction with the people visiting the stores with the aid of a questionnaire. The collection of primary data requires considerable time. In this research, the Primary data were obtained by actual working in the market and interacting with the buyers.

Questionnaire containing 21 questions was prepared. In total 152 people were interviewed who visited the different stores at different locations.

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Stores Visited for Research

1. Big Bazaar – Raja Garden 2. Big Bazaar – Vasant Kunj 3. Big Bazaar – Wazirpur 4. Big Bazaar - Noida 5. Vishal Mega Mart – Tilak Nagar 6. Religare – Dwarka 7. Big Apple – Rajouri Garden 8. Big Apple – Lajpat Nagar

People were asked questions about their preference when it comes to choosing a product under scheme, what kind of scheme they prefer monetary or non-monetary, then what kind of monetary or non-monetary schemes do they prefer. People were also asked if these schemes really influence their buying behaviour. Other questions include through what mode of communication they got to know about FEM, rate the current promotional strategy of FEM, etc.

Scope of the Project

A Training Program of 60 days in any organization provides information to all students like. i) Current organisation work-culture. ii) Industry practical knowledge. iii) Gives Professional touch. iv) Better awareness about market competition. v) Get chance to face different types of customers and tackle with different situation.

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FEM Product Portfolio

34

Fairness Bleach

Fem Fairness Bleach is the undisputed leader in the bleach market in India and has gained the trust and confidence of millions of users over last 2 decade s. It doesn’t just give fairness by oxidizing the facial hair to match with the skin tone but also helps the skin to breathe a new life by removing dead cells & unclogging the pores. Fem Fairness Bleach is a fast and safe way t o get a fairer and healthier skin. Just 15 minutes of application provides 15 days of radiant looking skin. It is available in consumer packs of 9g / 25g / 50g & parlour pack of 100g / 250g.

Material Description Size MRP

Fem Fairness Creme Bleach Apple & Peach 26.4 gram 35.00

Fem Fairness Creme Bleach Apple & Peach 52.8 gram 55.00

Fem Fairness Creme Bleach Apple & Peach 264 gram 110.00

35

Perfumed Blue Bleach

Fem Perfumed Blue Bleach is milder bleach specially formulated for those having a sensitive skin. The advanced formulation of Perfumed Bleach liberates nascent oxygen in a controlled manner to provide extra fairness that lasts up to 30 days. The perfumed activator of the Blue Bleach also gives a wonderful aromatic experience to users. It is available in consumer packs of 9g / 25g / 50g & parlour pack of 100g.

Material Description Size MRP

Fem Fairness Creme Bleach Milk, Pe arl & blueberry 26.4 Gram 39.00

Fem Fairness Creme Bleach Milk, Pearl & blueberry 52.8 Gram 63.00

36

Oxybleach

Oxybleach is the healthiest bleach in the world today. Oxybleach provides you a fairer, healthier radiance that too with many times more Oxygen. It comes with unique pre-bleach cream that forms a protective shield for even the most sensitive skin, and gives you a safe and enhanc ed bleaching experience. It is available in a 25g retail pack as well as 300g parlour pack.

Material Description Size MRP

Oxy Bleach 25 Gram 60.00

37

Herbal Bleach

Fem Herbal Bleach Contains 16 precious herbs : Keshar, Chandan, Lodhra, Patang, Raktachandan, Agru, Walaa, Manjistha, Jesthmadh, Temaalpatra, Padmakastha, Kamal, Kosth Kolinjan, Halad, Laakh & Daruhalad, Which make Kumkumadi Thilam, a proven ancient Ayurvedic formulation for fairness.Natural and Safe, Fem Herbal Bleach is a blend of nature's best. This makes it perfectly safe for all skin types, especially sensitive skin. It is available in a 15g retail pack

Material Description Size MRP

Fem Herbal Bleach 15 Gram 40.00

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Saka Oxygen Bleach for Men

Fem a company with a reputation as the innovators in the skin care category has launched Saka - Oxygen bleach for men. The skin care experts have formulated Saka to gently work wonders in just 15 minutes. It works with a three-pronged action * Bleaching to remove suntan, * Cleansing to remove dirt, bacteria, dead cells and provide extra oxygen to the skin, and * Nourishing to unclog pores. So you can give dull, lifeless skin a total lift, and an instant boost of life.

Material Description Size MRP

Saka Bleach 15 Gram 30.00

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Hair Removing Cream in Flavours

Fem Hair Removing Cream is gentle and painless way to remove unwanted hair from arms and legs. It provides silky, smooth skin within minutes. Its unique formulation not only removes hair from the root but also delays the re-growth of unwanted hair. It is available in 40g of Jar pack and in 25g of Tube pack in pleasant fragrances of Lemon, Chandan, Rose, and Blossom.

Material Description MRP Size

Fem Hair Remover System Rose (Jar) 40 Gram 35.00

Fem Hair Remover System Blossom (Jar) 40 Gram 35.00

Fem Hair Remover System Lemon (Jar) 40 Gram 35.00

Fem Hair Remover System Chandan (Jar) 40 Gram 35.00

Fem Hair Remover System Rose (Tube) 40 Gram 35.00

Fem Hair Remover System Blossom (Tube) 40 Gram 35.00

Fem Hair Remover System Lemon (Tube) 40 Gram 35.00

Fem Hair Remover System Chandan (Tube) 40 Gram 35.00

Fem Hair Remover System Rose (Tube) 25 Gram 25.00

Fem Hair Remover System Blossom (Tube) 25 Gram 25.00

Fem Hair Remover System Lemon (Tube) 25 Gram 25.00

Fem Hair Remover System Chandan (Tube) 25 Gram 25.00

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Liquid Hand Wash

Fem Soft Gentle Soap is the only liquid soap made from pure coconut oil that leaves your hands and face soft, supple and smooth aft er every use. One pearly drop of this unique liquid is enough to give you a complete cleansing experience. It is available in five lingering fragrances of Lemon Dew, Chandan, Blossom, Bouquet and Pea ch. It is available in dispenser pack of 250ml and refill packs of 1 litre and 5 litres.

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Material Description Size MRP

Fem Hand Wash Bouquet 250 ML 59.50

Fem Hand Wash Lemon 250 ML 59.50

Fem Hand Wash Chandan 250 ML 59.50

Fem Hand Wash Peac h 250 ML 59.50

Fem Hand Wash Blossom 250 ML 59.50

Fem Hand Wash Refill Pouch Blossom 200 ML 30.00

Fem Hand Wash Refill Pouch Lemon 200 ML 30.00

Fem Hand Wash Refill Pouch Peac h 200 ML 30.00

Fem Hand Wash Bouquet Refill 1 Litre 149.50

Fem Hand Wash Lemon Refill 1 Litre 149.50

Fem Hand Wash Chandan Refill 1 Litre 149.50

Fem Hand Wash Peac h Refill 1 Litre 149.50

Fem Hand Wash Blossom Refill 1 Litre 149.50

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COMPETITORS OF FEM

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FEM faces competition from various national and international brands for its product range. Fem Care has a leadership position in the fairness bleach category and a strong market position in hair removal and liquid soap category.

Bleach In the bleach category there are 2 major players;

Jolen

FEM

Jolene

It Camouflages facial hair, Cleans Skin. It has unique gas flushing action to cleanse skin pores. Strong antiseptic to prevent infection. Quick & Convenient. It is suitable for all types of skin.

Available in 9g, 18g, 35g, 140g & 300g

SKU MRP 9 Gram 24.00 18 Gram 42.00 35 Gram 75.00

44

Hair Removal Cream

In hair removal categories there are 3 major players are ;

Veet FEM

Anne French

Veet

Range from Veet creams - suitable for each skin type. Now whether you have normal, dry or sensitive skin there is a Veet especially for it. Plus with its special skincare ingredients- it will leave the skin feeling soft and super smooth. Available in 2 sizes: 25g and 60g at Rs 39.00 and 69.00 respectively.

SKU MRP 25 Gram 39.00 60 Gram 69.00

Anne French

Anne French hair remover available in four different fragrances available - sandal, rose, lavender and lemon. Available in 2 sizes: 25g and 40g at Rs 33.00 and 39.00 respectively SKU MRP

25 Gram 33.00 40 Gram 39.00

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Hand Wash (Liquid Soap)

In the hand wash category there is a lot of competition being built in the last few years. Existing players in this category are;

Dettol

Lifebuoy

FEM Palmolive

Santoor

Dettol

Dettol introduced the Liquid Hand Wash in 1994. It was known that many consumers use Dettol Soap for cleaning hands. Dettol Liquid Soap gave the consumers a soap in a more modern and convenient format for hand wash. Available in pump packs of 250ml and 135ml. Refills available in 185ml, 475ml and 900ml

SKU MRP 250ml (pump pack) 55 135ml (pump pack) 38 185ml (Refill) 40 900ml (Refill) 164

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Lifebuoy

Positioned on a ‘protection from germs’ platform it carries the tagline of ‘have no fear’ in the Liquidhandwash segment too. Lifebuoy Hand Soaps offer hospital-strength germ protection, with a unique formulation that generates a rich lather.

SKU MRP 200ml (pump pack) 40 180ml (Pouch Refill) 25 900ml (Refill) 125

Palmolive

Palmolive launched handwash in October 2003 with a premium pricing and imported stocks. While the brand is supported by promotions mainly in the modern trade, it is not active on air.

SKU MRP 250ml (pump pack) 55 250ml (Pouch Refill) 35 1000ml (Refill) 150

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Santoor

s a strong player in the bar soaps market and with a high market-share in the South,

Santoor launched the Liquid Hand Wash in January 2007, along with media support

SKU MRP 250ml (pump pack) 55 180ml (Pouch Refill) 27 1000ml (Refill) 150

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ORGANISATION STRUCTURE

49

Structure in Sales and Marketing

50

51

PROJECT ANALYSIS

Part 1 - Identify gaps in distribution, assortment and MBQ levels of FEM products. Part 2 - Study promotion/activation mix for three categories done by competition.

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First Part

In the first part we will be analysing various gaps that exist in the distribution, assortment and MBQ levels of FEM products in modern trade. We will only be concentrating on the skin care category of FEM i.e. Bleach, Liquid Soaps and Hair Removal Cream.

Modern Trade

Modern trade as opposed to traditional retail shops refers to a range of sale methods based on marketing techniques: for instance in self-service shops you have no more sales attendants behind the counter; now the customer can touch the articles. The more expensive goods will be ready at hand whereas you will have to bend to reach goods with less add value for the store. A few articles will be offered at rock bottom prices with much publicity in order to attract as many customers as possible. The display of goods is very important and needs an elaborate know-how.

Modern Trade Stores where FEM products supplied are: Big Bazaar Big Apple Vishal Mega mart REI 6TEN Surya Healthcare Apollo Pharmacy Guardian Pharmacy Religare Spencer H&B Store

Home Store

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Distribution Network at Dabur

CONSUMERS

The above diagram it shows channel of distribution of Dabur, here first the products are manufactured and from Manufacturing plants the packed goods are supplied to Clearing And Forwarding Agents(C&FA) and from here the goods are then further supplied to number of Stockiest or Distributors, from here goods reaches to large number of Retailers and it is the duty of Stockiest to take orders from retailers and then supply the goods to them, this work is generally done by stockiest salesman through ready stock or by taking orders first and then placing the order. From here the goods finally reaches to Customers. Customer purchases the product from retailers.

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This was the basic Channel of Distribution used by Dabur, now I will throw light on each channel of distribution of Dabur.

MANUFACTURING PLANT:

The manufacturing facility is at Manakpur, Post- Nalagarh, Dist. – Solan, Himachal Pradesh. This is in a tax-free zone under Central Government Scheme. It is about 50 kms from Chandigarh on State Highway, about 20 kms from Kalka (Haryana) Railway Station.

Manufacturing facility complying to international GMP standards are under set up to manufacture Pharmaceutical products and Cosmetic Creams & Lotions.

Four manufacturing set ups with the capacity of 3600 kg per shift can be undertaken. There will be a facility of jar, aluminium tube and lami tubes filling with automatic labelling and online packing of the products. There will also be a facility for pouch filling and pillow packing of tubes.

PROCUREMENT & TRANSPORT:

Getting the raw material and packaging material requirement from the production

unit in charge. Constant updates on the procurement of materials and transport details. Production details and ingredient content information from the different personnel

and coordinating this activity.

CLEARING AND FORWARDING AGENTA (C&FA)

From manufacturing plant the stock is transported or supplied to clearing and forwarding agents.

Clearing and Forwarding Agents is a third party and Dabur gives contract to them, so company has nothing to do in building the relationship with them.

Here C&FA keep or stock the goods with them.

They charge Dabur for stocking the good and even Dabur don’t mind doing so as it isa measure of cost cutting as well as there is no need for go downs and maintenance.

For Ghaziabad, Meerut, Delhi NCR there is one C&FA whish is situated in Mohan

Nagar, here all goods which Dabur foods hare kept here.

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STOCKIEST OR DISTRIBUTORS Stockiest store the products in their godowns, C&FA supplies the goods to them as

per their order. Stockiest has some sales men working under him, they are known as stockiest sales

man. Their work is to place the products in the market and take order from retailers and then supply goods to them.

Sales man either takes ready stock with them or they first take orders and then

supply goods later on. There is a beat which is a schedule route of sales man, means sales man has to daily

cover the route as mention in the beat. Merchandising, making products visible, pasting posters, putting banners, and seeing

that goods are properly placed in the retail outlets is also the duty of stockiest sales man.

Companies’ sales officer keeps a check on the stockiest and monthly report is also prepared which is further analysed by ASM & ZSM.

In Noida Dabur has 1 stockist, and in Ghaziabad 1 RETAILERS

Retailers are backbone of the company as they are the one who can take the product on new heights or can bring it down to toes.

Stockiest supplies goods to retailers and tries Persuading retailers to give the brand

special displays (using merchandising tools) to get affective brand presence, and arranging it in more noticeable manner.

Classification of outlets in different type of markets is different according to their

sales volume. TYPES OF RETAILS OUTLETS

Class Average Monthly Business A Above 10,000 B 5,000-10,000 C Upto 5,000

Margin of retailers is always higher than stockiest. Retailers are the one who have direct contact with the customers.

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Distribution Process or Supply Chain of Dabur in Modern Trade

Process at Distributor Level

Clearing and Forwarding Agent sends required order to the stockiest or distributor.

Distributor receiv es goods as per the order placed and enters the same in his stock book.

CFAs keep receiving goods from the Manufacturing Unit as per the production of goods.

Manufacturing Unit produces goods according to the Sales Forecast done.

Sales Forecast for FEM is done on the basis of last 3 months sales. Data from various modern trade chains is collected to calculate the sale of FEM

products and accordingly considering the demand and sales figure, sales forecast for the coming 3 months is made and the manufacturing unit is asked to produce the required quantity.

Dabur’s distributors maintain at least 15 days of inventory with them.

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Process at Store Level for Order regeneration

Counting of Current Stock available at the store

Raising a purchase order to the vendor by the category (In head office and zonal office)

Purchase order generated is sent to the distributor or the Dabur Merchandiser.

Dabur Merchandiser further sends it to the Distributor.

Counting of the stock present in the store in done by the Dabur Promoter who are present in the store or by the Dabur Merchandiser.

After going the through the stock available in the store. Dabur representative places order with the Department Head in case order is placed through Centre Distribution Centre and through store manager or the department manager when the order is placed from the Store itself.

MBQ level are generally decided by the Centre Distribution Centre or the Store Manager.

Purchase Order generated is send to the Dabur Distributor.

Replenishment takes place within 3 days from the dispatch of the purchase order. Payment as regards to the Purchase order is done on credit basis.

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Deliv ery of the required (negotiated) stock from the distributor’s end to the store or ware house bythe help of transporter (at company’s expense)

Receiving of the material at the central ware house (C.D.C.) Indore

Receiving of the material at the store with all the required documents

Dewas naka

Document check by the security at the gate and in ward register is maintained by following all the rules of S.O.P.

Weighing, counting of cartoons, generation of I.R. no. by putting information on SAP

Compare the material with the documents, stamp the documents, write information with signature of the security and then unload the truck

Stamp on P.O.D. copy and return to the transporter

Transfer of the material to the store ware house Segregation of the material (M.C. wise and category wise)

Send the stock to the floor as per the requirement Racking of the material by giving location to the rack as well as to the box (for the maintenance of the W.M.S. sheet)

Out warding of the material from central ware house to the store, after receiving S.T.O. from the store.

Receiving of the material at the store against S.T.N. 59

DATA PRESENTATION AND DATA ANALYSIS

To study the gaps that are prevalent in the Distribution system of Dabur for FEM products, I visited 70 Modern Trade stores and their Distribution Center (DC) of different Chains in Delhi and NCR Region. There I just orally asked them few questions related to the SKUs that are being kept by them, what is the MBQ Levels of different FEM product, what are the deciding factor behind setting up of MBQ level, how is the fill rate of FEM, how is the distribution system of FEM, how much time it takes for replenishment, are they satisfied with the margin provided by the company, are they satisfied with the Dabur as a company, etc.

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Satisfaction as regards to Distribution of FEM products.

Satisfaction

Yes 45

No 25

45

25

1015202530354045

05 Yes No

Series1

Interpretation:-

It is quite evident from the chart that out of 70 outlets and distribution centres visited by me, 45 of them feels that distribution system of Dabur is satisfactory while 25 of them are not satisfied with it. Some of the reasons given were margins offered by the company, fill rate being low, credit issues with the company etc. But at the same time Positive feedback about Dabur was that since Dabur has taken over FEM, there has been a drastic improvement in the distribution of FEM products.

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Various fast moving and slow moving SKU’s of FEM.

Item Name MRP Size UOM Quantity Sold in May and JuneFem Fairness Creme Bleach Apple & Peach 26.4 g 32 25 GM 508Fem Fairness Creme Bleach Apple & Peach 52. 8 g 51 50 GM 777

Fem Fairness Creme Bleach Milk, Pearl & blueberry 26.4 g 39 25 GM 688Fem Fairness Creme Bleach Milk, Pearl & blueberry 52.8 g 63 50 GM 629

Oxy Bleach 60 25 GM 1,159Saka Bleach 30 15 GM 660

Fem Herbal Bleach 40 15 GM 1,032Fem Hair Remover System Rose (Tube) 25 25 GM 144

Fem Hair Remover System Lemon (Tube) 25 25 GM 110Fem Hair Remover System Blossom (Tube) 25 25 GM 4Fem Hair Remover System Blossom (Tube) 29 25 GM 44Fem Hair Remover System Chandan (Tube) 29 25 GM 4

Fem Hair Remover System Chandan (Jar) 35 40 GM 112Fem Hair Remover System Chandan (Jar) 37 40 GM 92

Fem Hair Remover System Rose (Jar) 35 40 GM 78Fem Hair Remover System Lemon (Jar) 35 40 GM 108Fem Hair Remover System Rose (Tube) 35 40 GM 276Fem Hair Remover System Rose (Tube) 37 40 GM 187

Fem Hair Remover System Blossom (Tube) 35 40 GM 87Fem Hair Remover System Blossom (Tube) 37 40 GM 199Fem Hair Remover System Blossom (Tube) 37 40 GM 189Fem Hair Remover System Lemon (Tube) 35 40 GM 113Fem Hair Remover System Lemon (Tube) 37 40 GM 124

Fem Hair Remover System Chandan (Tube) 35 40 GM 75Fem Hair Remover System Chandan (Tube) 37 40 GM 120

Fem Hand Wash Bouquet 59.5 250 ML 152Fem Hand Wash Lemon 59.5 250 ML 66

Fem Hand Wash Blossom 59.5 250 ML 238Fem Hand W ash Refill Pouch Blossom 30 200 ML 24Fem Hand W ash Refill Pouch Lemon 30 200 ML 102Fem Hand Wash Refill Pouch Peach 30 200 ML 23

Fem Hand Wash Bouquet Refill 149.5 1 Ltr 24Fem Hand Wash Lemon Refill 149.5 1 Ltr 42

Fem Hand Wash Chandan Refill 149.5 1 Ltr 30Fem Hand Wash Peach Refill 149.5 1 Ltr 74

Fem Hand Wash Blossom Refill 149.5 1 Ltr 34Fem Hand Wash Lemon Refill 555 5 Ltr 4Fem Hand Wash Peach Refill 555 5 Ltr 1

Fem Hand Wash Blossom Refill 555 5 Ltr 3

Quantity sold is till 15th of June.

Source – Vijman India

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Total SKU 39 Fast Moving 7 Slow Moving 32

32

7 101520253035

05 Fast Moving Slow Moving

Series1

Interpretation:-

As we see in the above list of FEM Products, there is a total of 39 SKUs but only 7 of them are fast moving products rest of the SKUs are slow moving. When asked various retailers that why they are not keeping all the SKUs, the reason given was only fast moving products are preferred because the slow moving product does not have high sales and they only occupy shelf space in the store. All the bleaches of FEM are highly fast moving while Hand Wash and Hair Removal are not at all sold in comparison to Bleach. ccording some of the retailers Bleach’s demand is sohigh that the supply always fall short of it, whereas in case of Hand Wash and Hair Removal it’s the opposite, stock for them is kept on the shelf for more than 25-30 days without any sale in small modern trade stores. That is why out of 39 SKUs registered with almost all the Modern Trade stores, most of the Chains keep only around 20-25 SKUs. Majorly bleach of all SKUs, Hair Removal Cream of 40 gram Tubes in all variants and Hand Wash 250ml sprays.

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Fill Rate of FEM products ordered.

Fill Rate – Sales order processing measurement that quantifies the ability to fill orders. There are various ways of measuring fill rate. Line fill compares the number of line items shipped complete to the total number of lines ordered ( 95 line items shipped complete out of 100 lines ordered would result in a 95% line fill rate). Order fill compares the number of orders shipped complete to the total number of orders shipped. Now to calculate fill rate, I have taken few examples of Purchase Orders and Supply against them. For this I have collected POs of Big Apple and what has been the supply against it for the month of May. This will not only tell us the Fill Rate of the company but also time gap between order placed and goods replenished.

Party 1 - Express Retail Service (Modern trade chain known as Big Apple) Party 2 – Vijman India (Distributor of Dabur India Limited) Case 1 First Purchase Order (See Annexure 1) Date 03.05.2010 PO No. 272/10 Net Bill Amount – Rs. 169925

Supply Bill (See Annexure 6)

Date 06.05.2010 Invoice No. A0000036 Net Amount – Rs. 92907 In this Fill Rate will be calculated value wise. For First PO Fill Rate is 55%. Other than this of the 10 SKUs of FEM that are placed in the order only 7 are supplied. And of those 7 as well some orders are not fully supplied. Goods are replenished within 3 days from the date of placing of order.

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Case 2 Second Purchase Order (See Annexure 2) Date 10.05.2010 PO No. 330/10 Net Bill Amount – Rs. 213547 Supply Bill (See Annexure 7) Date 20.05.2010 Invoice No. A0000061 Net Amount – Rs. 169416 For Second Purchase order Fill Rate is 79% (calculated value wise). Of the 7 FEM SKUs that were ordered only 5 were supplied. Other than the fill rate issue, the order was sent on 10.05.2010 whereas the goods against them have been supplied on 20.05.2010; there was a gap of 10 days between order and supply.

Case 3 Third Purchase Order (See Annexure 3) Date 20.05.2010 PO No. 426/10 Net Bill Amount – Rs. 100780 Supply Bill (See Annexure 8) Date 22.05.2010 Invoice No. A0000062 Net Amount – Rs. 83782 For Third order Fill Rate is 83% (calculated value wise). Out of 4 FEM SKUs that were ordered in the PO, 3 of them were supplied. Replenishment was very good for this order; the goods were supplied within 2 days from the placing of order.

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Case 4 Fourth Purchase Order (See Annexure 4) Date 27.05.2010 PO No. 490/10 Net Bill Amount – Rs. 76936 Supply Bill (See Annexure 9)

Date 30.05.2010 Invoice No. A0000077 Net Amount - Rs. 70131 For fourth order Fill Rate is 91% (calculated value wise). All the SKUs which were ordered have bee n supplied as well. 2 of the SKUs are there in which the whole quantity demanded is not supplied. In one of them 60 pieces and in other 90 pieces were ordered but 36 and 66 respectively have been supplied against them. We discussed 4 purchase order and supply against them of the same company in the month of May. While in the 1st PO, fill rate was too low, it kept increasing with high variation from 55% to 79% to 91%. In the second PO it was observed that with the fill rate, even replenishment of order took too long. IN the third PO fill rate and order supply date was fine but 0 quantity of one of the SKUs was supplied, this means that fill rate line wise was 80% in this case. There was almost nothing wrong in the fourth PO, it can be called as a perfect purchase order and supply against it. We had 4 cases with 4 different situations.

Cases: 1. Low Fill Rate value wise 2. Too much time taken in Replenishment 3. Low Fill Rate line wise 4. Perfect order and supply.

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Another case of Fill Rate; Party 1 – Future Value Retail (Modern trade chain known as Big Apple) Party 2 – Vijman India (Distributor of Dabur India Limited) Purchase Order (See Annexure 5) Date 02.05.2010 PO No. 4504419715 Net Bill Amount – Rs. 7255 Supply Bill (See Annexure 10)

Date 05.05.2010 Invoice No. B0000273 Net Amount – Rs. 2836 In this case Fill Rate is 39% calculated value wise. Of the 13 SKUs of FEM which were ordered only 5 SKUs were supplied. Replenishment date was within the time limit. One of the other things I observed in this Purchase Order is that purchase order was generated on 02.05.2010 which is being 1 wee k of the month. So while I was there in the Big Bazaar store for Interview, I noticed that there large amount of people who come in the first week of the month as compared to rest of the weeks. When confirming with the authorities I got to know that footfall is 30-35% more in first week of the month as compared to rest of the weeks. This is due to the reason that most of the service class people get their salaries in first 10 days of the month and that is the time when the purchasing power of an individual is the most. Since first 10 days of the month are very crucial from the sale point of view, there should not be any miss in the SKUs supplied in these particular days. Because unavailability of products can result in not only losing the sale at that point of time, but the customer may also switch to some other brand thereby we as company loose a loyal customer as well.

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MBQ Levels To keep a steady stock watch for the reorder of basic goods is time consuming and vital to

profits. Different stores have different criteria to compute what the MBQ level of an item should be. The retailer can use past sale data of last month or last 3 month’s sale or in somecases where product is seasonal or has a demand in particular season; MBQ levels are decided season wise as well. This profit-enhancing feature uses sales history to calculate scientifically what and when to reorder, with less paperwork and less guesswork. MBQ (minimum base quantity) methodology has been used for efficiently handling the inventory based on past sales track.

While interviewing the outlets and distribution centres of retail chain, when asked about how they are deciding the MBQ level, a lot of inputs came as regards to the factors that they consider while deciding the MBQ level of an item; the same has been put on graph to see what are the factors that are most considered by retails chains.

MBQ level deciding factor

Past Month Sale 27

Past 3 Months Sale 11

Stock in Hand 7

Footfall 21

Season 4

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6%

Past Month Sale 38% 30% Past 3 Months Sale

Stock in Hand

Footfall

Season

10%

16%

Interpretation:-

As we see in the chart that most of the outlets or modern trade chain prefer deciding their MBQ level on the basis of past month’s sale, they have the highest preference with 38%.Next is footfall in a particular outlet, now this depends on various sub factors like what kind of people are actually in and around that area where the outlet is located, the type of income level of people in that area and various other demographics. Footfall got 30% preference while deciding the MBQ level of a particular product. Past 3 months sale of a product got 16% while 10% are in favour stock in hand in that particular store, this factor is considered most by those chains whose inventory management is centrally controlled. And the last with 6% preference is Season. According to me this got the least percentage because of a limitation that Season factor is considered most in seasonal products and since this question was asked keeping in mind the FEM products not many people preferred this option.

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Case Experience regarding MBQ Level I had frequent visits in most of the Big Bazaar stores in the Delhi region in the month of May in different weeks. There I noticed that the MBQ level are decided on the basis of past month sale, but the MBQs of all almost all the bleach products were same irrespective of their demand. During 1st week of May, the demand for Oxy Bleach and Herbal Bleach was very high in all the stores, MBQ level ordered for both the products was between 24-36 pieces in almost all the stores. But on visiting Big Bazaar Vasant Kunj store I noticed that of 36 pieces, 31 pieces of Oxy Bleach were sold on the very first day of the replenishment of stock, now for rest of the week there were only 5 pieces of Oxy Bleach were left, which ultimately resulted in no stock for next 5 days. When I visited the store after 15 days, the same scenario was experienced again. When I asked the Dabur promoter in the store, why the same MBQ was given for oxy bleach, the lady there said that she informed the concerned authorities about the same but no action has been taken. In another experience there was no supply of Oxy Bleach for one week in all the Big Bazaar stores because of blockage of Oxy Bleach Code which resulted in unavailability of Oxy Bleach in all the stores at the time when its demands is reaching its heights.

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Gaps that were noticed in the distribution, assortment and MBQ level are;

First and the foremost major gap is the Fill Rate, being on an average less than 65% calculated value wise. Fill rate is low because of unavailability of products in required quantity from the company and distributor. Fill rate is low not just value wise, but it’sthe same SKU wise or line wise or case wise. Approximately fill rate should be around 85%, keeping in mind the takeover of FEM by Dabur and the type of facilities that can be offered by the company to its this segment.

Distributors and retailers are not keen in keeping all the registered SKUs with them in the store because of the fact that only 20% of them are fast moving, rest of them have very slow movement which leads to occupied shelf space without any sale. Of all SKUs, retailers prefer to keep only bleach category of FEM because it has a very high sale as compared to Hair Removal Cream and Hand Wash.

While those categories which are put in the store, they are not kept in all the variants which leads to unawareness among the consumers about other variants. In another case, there is a SKU of FEM Fairness Bleach coming in the parlour pack of 100 Gram, its demand is there in all the Big Bazaar stores but the company has stopped making 100 gram packs.

Replenishment of FEM stock takes place with rest of the Dabur order, i.e. the same transport van is used for Dabur stock and FEM stock and if there is unavailability of FEM products, it will have to wait for the Dabur Purchase Order to be generated and with that supply comes the FEM supply. Other than this it has been observed that in some cases it took way too long for supply to take place which resulted in loss of sale and may be customer as well, since these days with so many of competitive products in the market customer generally don’t wait for the product to arrive and therefore fulfil his need with another brand offering same services. Unavailability ultimately resulting in loss of loyal customer.

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Minimum Base Quantity is set up without any standard procedure. Moreover the same quantity is followed irrespective of the demand of that particular. Like in case of Big Bazaar discussed earlier, in which the footfall on an average is around 2400 on weekdays and around 3000 on weekends in first 10 days of the month which is 30% more than the footfall for rest of the month still the same MBQ level is followed without considering the above factor of footfall. And because of low MBQs supply falls short of demand leading to loss of sale.

Another of the reason why Modern Trade chains avoid taking orders of all MBQs and in large quantities because it has been observed that there is a lot of loss of money and stock on account of theft and pilferage in these stores because of the modern structure of self-pick of the product whichever consumer wants. Moreover these chains concentrate more on the outlets than their warehouses which at times lead to spoilage of products stored in these warehouses.

Purchase orders are generated on the visit of Dabur representative who comes and write the PO on a piece of paper and then take it back to the distributor. There are only 3-4 modern trade chain which send their orders through mail, rest is done through writing on the piece of paper. This makes it difficult for the sales person and can also lead to small human errors while noting down the order.

Modern Trade chains are not satisfied with the Margin been given to them, while their expectation are around 25%, they get somewhere between 15-20%, because of low margin, the chains are not very particular about Dabur and FEM products and don’t give much importance to their sale.

There were credit issues with one of the Chains which led to stoppage of supply of products to that particular chain. Relationship was spoiled between the company and the chain. While the issue was still not resolved, both the parties already had a loss because of this issue.

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Lack of awareness among distributors and retailers about the SKUs being made by the company. In a conversation with Vijay Aggarwal who is the owner of Vijman India, he told me that he himself was not aware of the Hand Wash SKU coming in 5 litre pack and when asked the reason behind it, he said there was no communication from the company regarding the same. Similarly while interviewing one of the retailers; he said there was no communication regarding the schemes from the company. This means there has been constant communication gap between the company and the distributors and retailers.

In some cases, sale representative tried to push the product to the retails chain because they themselves were working on target based sales. These are always realistic goals but the stress in on an improvement over past performance. This led to overburdening the retailer with the stock and releasing the pressure their own shoulders.

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Second Part

In the second part we will be analysing various promotion methods that are prevalent in the skin care segment and which influence the buying behaviour of consumers. We will also discuss promotional schemes which are preferred by the consumers and which lead to the consumers buying that particular product. And on that basis we will be recommending promotional strategy which can result in incremental sales without causing any channel conflict.

Sale Promotion

The well-known four Ps of marketing represent the sellers’ view of the marketing toolsavailable for influencing buyers. From a buyer’s point of view, each marketing tool isdesigned to deliver a customer benefit. lso the sellers’ four Ps correspond to thecustomers’ four Cs. Four Ps Four Cs Product Customer solutions Price Customer cost Place Convenience Promotion Communication

Promotion

Promotion is tool with which public will be informed about the availability of a particular product or service and the uses of such product. Production decides the increase in demand for a product; promotion will make the prospective buyers to know about the want, satisfying characteristics of the product, its price and place of availability. This term includes advertisement, personal selling sales promotion and other selling tools which are increasing the sales volume.

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Sales Promotion

Sales promotion is different promotion, Sales promotion refers to those marketing activities other than personal selling, advertisement and publicity, which stimulate consumer purchasing and dealer effectiveness, such as displays, shows and expositions, demonstrations and various non-recurrent selling efforts not in the ordinary routine. Its purpose is to increase the desire of salesman, distributors and dealers to sell a certain brand and to make consumers more eager to buy that brand. This includes sales activities which supplement both personal selling and advertising.

Sales promotion is only a part of promotion. Promotion includes sales promotion, advertising, personal selling etc. Promotion helps to make all other marketing activities more effective and efficient, but sales promotion helps only to sales activity. Sales promotion may be done with the help of tools like displays, exhibitions, free sample coupons, premium etc. Sales promotion acts as a link between advertisement and persona l selling.

To sum up, promotion is to make the demand inelastic, while there is change in the price. So promotion must stimulate the consumers to buy more.

Communication and promotion

Marketing communication involves, sharing of meaning, information, concepts, about the products and services by buyers and sellers. Such communications are conveyed with the help of advertisement, salesmanship and sales promotion. A communication will be treated as effective only when it is properly responded by the buyer. The communication must have identical meaning for both sender and receiver. If the communication does not properly reach the receiver or the message received is not the same as the message sent, then that will be called Break down at the message stage. In the market communication, feedback means a response, a reaction over the message sent back by a customer to the sender. In the case of effective communication feedback will be always present.

Need for Product Promotion

a) To introduce a new product in the market. b) To influence the public with the help of new uses of the product. c) To increase the frequency of purchase by each buyer. d) To encourage dealers to stock more goods. e) To withstand in the competitive field. f) To increase the sales by imparting special training to salesmen and by window display.

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Effects of Promotion

1. The present day market is very competitive due to the large number of rivals and substitutes. With the help of promotion producer must create product differentiation in the minds of consumers.

2. Promotion is very essential to communicate the use of the product and the nature of the product to consumers and middlemen

3. Nowadays most of the consumers market their products in wider area and the consumers are also very large in number. In such cases personal selling alone cannot be used and so all the steps for promotion are to be followed.

4. During the periods of depression it is essential to maintain at least some minimum market. Therefore it is very essential to use promotion.

Benefits offered by sales promotions • It helps in securing trial and defending shelf space against competition. • Smoothens out the manufacturing capacities of firms in such a way that the peaks and thevalleys are minimized. • Provides opportunities to manufacturers to reach out market segments with differingprice sensitivity • dds excitement to the in-store merchandizing of consumer goods • Motivates the trade to keep more and push more of those brands that are on promotion

Types of sales promotion

Sales promotion can be grouped into the following:

Consumer sales promotions (Pull Strategy) - Consumer sales promotion methods encourage or stimulate consumers to patronize specific retail stores or try particular products.

Trade sales promotions (Push strategy) - Trade sales promotion methods stimulate wholesalers and retailers to carry a producer’s products and to market theseproducts more aggressively.

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Sale Promotion done by competition in all 3 categories.

Bleach

Jolen – Having no consumer promotion scheme but works a lot through TV Advertisement, Magazines and other medium on its Brand building aspect.

Hair Removal Cream

Veet – Consumer Promotion scheme of 20% extra on 60 gram pack. Launched Katrina Kaif as their brand ambassador. Advertisements are seen on TV channels and Magazines. Other below the line mode of communication used is Wobblers, consumer’s leaflets, trade offersetc.

Anne French – Consumer promotion scheme through small sachets of cleansing cream with 40 gram pack. Few days back Kareena Kapoor; famous Bollywood star is announced as the brand ambassador of Anne French.

Liquid Hand Wash

Dettol – Consumer promotion scheme of 250 ml pouch on purchase of 250 ml spray. In another scheme Rs. 15 off on 1 litre refill. Dettol also emphasises on its brand building through TV Advertisement.

Lifebuoy – Consumer promotion through 180 ml pouch refill on purchase of 200 ml spray bottle. Again a lot of promotion done through TV advertisement and Magazines.

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DATA PRESENTATION AND DATA ANALYSIS

For the purpose of deciding on the method of Promotion to be adopted, what is the preference of customer when it comes to choosing the schemes, awareness about FEM etc., we used the questionnaire method.

Questionnaire with 21 questions was prepared. Survey was done in various modern trade stores. People interviewed were those who visited the store for shopping purpose.

Sample Size: 152

Please visited for Survey are:

Big Bazaar – Raja Garden

Big Bazaar – Vasant Kunj Big Bazaar – Wazirpur

Big Bazaar - Noida Vishal Mega Mart – Tilak Nagar Religare – Dwarka

Big Apple – Rajouri Garden

Big Apple – Lajpat Nagar

Limitations of the Survey

During the project we have to trust the dealers and the customers and their perception, actual may vary.

Consumers in hurry, hence not willing to answer the questions.

Sample size is small, hence not accurate. The duration of time for the study was limited & hence a comprehensive & elaborate

study could not be undertaken.

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In total 152 males and females were interviewed for this survey.

Age Group Male Female 0-18 2 5 18-25 7 21 25-35 19 39 35 + 28 31 Total 56 96

96 100

56

39

31 28 21 19

5 102030405060708090

0 0-18 18-25 25-35 35 + Total2 7

Male Female

Interpretation:-

Of the total of 152, 96 were women and 56 were men. This shows that the major part of the sample visiting the stores is female. And of them highest are in the age group of 25-35. As compared to that in the men population highest number is taken by the men of age group 35+. The above data shows that men above 35+ are still the purchasers of the family whereas female of 25-35 category are slowly becoming the next decision maker of the family.

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Occupation of the people interviewed.

Occupation Student 26

Self Employed 39

Service 57 House wife 27

Others 3

2%

17% 18%

Student

Self Employed

Service

House wife 26%

Others

37%

Interpretation:-

37% of the population interviewed was from service class, this shows that a lot of people from the service class prefer to buy their daily household stuff from the modern trade store. Next in the line comes the Self Employed with 26%. Student and Housewife are of almost the same percentage in this sample of population.

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Awareness about FEM

Awareness Yes 136 No 16

136

100120140

16

20406080

0 Yes No

Interpretation:-

Out of total of 152, 89% of the population sample was aware of the FEM. This shows that the brand awareness of FEM is pretty good. People are familiar with the brand. A lot of credit of its brand awareness among the skin care segment goes to its Bleach Segment. In this segment FEM is still the market leader competing with only known brand Jolen.

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Medium through which people got to know about FEM

Medium of Awareness TV Advertisement 68

Newspaper 7 Internet 5

Friends and Relatives 24 Store Visit 29

Other 3

2%

21% TV Advertisment

Newspaper

Internet 50%

Friends and Relatives

Store Visit18%

Other

4% 5%

Interpretation:-

Most of the awareness is spread through the medium of TV Advertisement. Being the most widely used method of advertisement, this method has become the most influential method of advertising as well. Preity Zinta has been the brand ambassador for FEM. Recently a couple to TV advertisement were also launched with Preity Zinta endorsing FEM in them. 21% of the people also got aware through direct visit in the store and noticing the product there. Word of Mouth holds 3rd position with 18% as done generally through friends and relatives. 16 people did not answer this question because they were unaware of the product.

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No. of Users of FEM out of the Sample Population

Users Male Female Total Yes 16 82 98 No 40 14 54 Total 56 96 152

98

100 82

54

40

16 14

102030405060708090

0 Male Female Total

Yes No

Interpretation:-

Of the total sample population of 152, people who have used FEM is 98 in number and people who have never used FEM is 54. When a further analysis was done, it was observed that out of the count of 98 people who have used FEM’s product, 82 were females and therest 16 were males. This shows that the major user population of FEM are Females. The reason could be since FEM has skin care products and Indian Male is still not very open to using products like Hair Removal and Bleach. 16 Males saying yes could be because of the growing popularity of FEM’s Men Bleach S K or usage of Liquid Hand Wash.

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Products Used

Products Used Hand Wash 37 Bleach 36 Hair Removal Cream 25

25%

38%

Hand Wash

Bleach

Hair Removal Cream

37%

Interpretation:-

If we see in the figure, major usage is of Hand Wash and Bleach with 38% and 37% respectively. This could be because Hand Wash market is growing Day by Day and FEM’sHand Wash are considered best when it comes to quality of the Liquid Soap. With bleach FEM has already established itself as the market leader. Hair Removal is lacking behind because the market for it is still in its growing stage and FEM’s competitor is VEET which hasestablished itself as a well-known Hair Removal brand in the market.

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Unavailability of FEM in Stores

Availability Yes 34 No 66 May Be 28

70 66

60

50

34 40

30 28

20

10

0

Yes No

May Be

Interpretation:-

Of the total of 128, there are 34 people who have experiences Unavailability of FEM products in stores. Whereas 66 people never experienced unavailability of FEM. 28 people are not sure and 24 people did not answer this question because of some or the other reason.

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Pricing of FEM Products

Pricing Yes 108

No 20

108 120

100

80

60

40

20 20

0

Yes

No

Interpretation:-

108 people are satisfied with the pricing of FEM whereas 20 people say that pricing needs to be improved. When interviewed these people regarding why pricing is not satisfactory one of the common replies came up was quality of FEM products does not match its pricing. Plus similar products that come in the other brands always have some schemes with them, whereas with FEM there is hardly any scheme. Again 24 people did not answer this question, may be because they are ambiguous about the pricing of FEM products.

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Awareness about various schemes offered by FEM

Awareness about Promotion

Yes 38

No 86

May Be 28

18% 25%

YesNoMay Be

57%

Interpretation:-

FEM has never been hard promoter of its products but after Dabur has taken over FEM, Dabur has been able to sign up with Preity Zinta as their brand ambassador for FEM products. Still not a large amount of money has been spent on its product promotion and that is the reason why 57% of the people who took this survey are unaware of the promotion that has been done by the company. Only 25% of the sample population is aware of the promotion that has been done by FEM and 18% are not sure about it.

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FEM's overall sale promotion strategy

Overall Promotion strategy Poor 10 Below Average 26 Average 82 Good 30 Excellent 4

3%

6%

20% 17% Poor

Below AverageAverageGoodExcellent

54%

Interpretation:-

Of the total population who took this survey, 54% says that the overall promotion strategy of FEM is average. While 3% says it’s excellent and 6% marked it as poor. gain since FEMhas never spent large amount of money on its brand and product promotion, not many people are actually thoroughly impressed with the promotion of FEM and this is why it got an average rating.

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Promotion done by FEM for each of the 3 category of products.

Hand Wash

For Hand Wash Poor 24

Below Average 44 Average 54 Good 28

Excellent 2

1%

16% 18%

PoorBelow AverageAverageGoodExcellent

29%

36%

Interpretation:-

FEM being not the market leader in Liquid Hand Wash segment is expected to concentrate on the promotional aspects because its competitors are very highly reliable on various promotional methods. This is the reason why most people think that FEM Hand Wash category promotion is average or below average. There is no current scheme on it. Some 4-5 years back was the last advertisement of FEM Hand Wash was shown on TV; even that advertisement was not very impressive.

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Bleach

For Bleach Poor 14

Below Average 14 Average 56 Good 58

Excellent 10

7% 9%

9%

PoorBelow AverageAverageGoodExcellent

38%

37%

Interpretation:-

In the bleach category, a lot of people are impressed with the promotion being done by FEM that is why they rate the promotion of bleach above average. In fact, Dabur FEM has signed Preity Zinta as their brand ambassador for the Bleach category. There is another advertisement being shown on TV regarding SAKA bleach as well. Other than this FEM being the market leader does not have to do much to increase its sale in this category.

90

Hair Removal Cream

For Hair Removal Cream Poor 14 Below Average 18 Average 58 Good 54 Excellent 8

5% 9%

PoorBelow AverageAverageGoodExcellent

12%

36%

38%

Interpretation:-

In the Hair Removal category, 38% feel that the promotion is Average while 36% feel it is above average or good. FEM has run a couple of Consumer Promotion offers in which cleansing cream was given with the tubes. Other than these there has not been much promotion for Hair Removal category. However, its competitors are highly dependent on commercial methods of promotion.

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Percentage of people who have bought FEM under promotion

FEM bought under promotional scheme Yes 22 No 130

140 130

120

100

80

60

22 40

20

0

Yes

No

Interpretation:-

Out of total of 152, if we take 96 people who have used FEM some time or other and of those only 96 people only 22 people have purchased FEM under the promotional scheme, which is 23% of the total population who has used FEM is still very low. This shows that the FEM does not provide schemes to its customers on regular basis. Even when they do it is not communicated to its customers properly which result in low purchasing even when products sold with schemes.

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Sale Promotion influencing buying behaviour

Sale Promotion Influence

Yes 78

No 24

May Be 50

33%

YesNoMay Be

51%

16%

Interpretation:-

Out of 152 people, 51% believe that Yes sale promotion does affect their buying behaviour while 33% are not sure about and 16% believe it does not really matter if the product is under promotion or not, their buying of a particular brand will be the same irrespective of the promotional schemes with them. But since more than 50% are of the sample population thinks that sale promotion is important, it becomes important for FEM to concentrate individually on each of its product categories and provide schemes with each one of them.

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Method of sale promotion preferred by consumers

Method of Promotion

Monetary 92

Non-Monetary 60

92 100

90

7080

60

60

50

40

203010

0

Monetary Non-Monetary

Interpretation:-

Most of the people who were interviewed prefer Monetary Schemes with the products above the Non-Monetary schemes and the same is evident from the fact that out of 152 people 92 prefer Monetary Schemes while the rest of 60 people prefer Non-Monetary schemes. One of the reasons behind this could be that major part of the Indian population is money centric and they want to save anyhow. This is why we see sale taking variable heights when goods are sold at low prices or with discount schemes.

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Which of the monetary method of promotion is being preferred by Indian consumer?

Non-Monetary Method

Gifts 54

25% Extra Scheme 50

Lucky Draws 8

Trial Packs 40

Discounts (Example – Rs. 10 off) Buy 2 get 3rd at 50%

11%

35%

Buy one get one43%

11% Buy family pack and get25% off

Interpretation:-

43% of the total population prefers scheme of Buy One get One free, rationale behind this scheme is, it not increases the quantity in your shopping cart but also decreases the price of the product which you have originally bought. Next is Discount Scheme, again decreases the prices of the product. Discount scheme is the most commonly used method of sale promotion. Buy 2 get 3rd at 50% and Family Pack scheme does not have very popularity among people, more so because Discount and Buy one Get one, has more advantage and further more satisfaction as compared to other schemes.

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Which of the Non-Monetary method of promotion is being preferred by Indian consumer?

Non-Monetary Method

Gifts 54

25% Extra Scheme 50

Lucky Draws 8

Trial Packs 40

26% 36%

Gifts25% Extra SchemeLucky DrawsTrial Packs5%

33%

Interpretation:-

Among the Non-Monetary methods of promotion, Gifts is the most popular with 36% preference. One of the reason behind this could that Gifts has this surprise element attached with it and the consumer is always excited about it. Next is Extra Quantity in the same pack scheme with 33% preference, this is preferred because it gives you more quantity at the same price. Trial Packs get 26%, trial packs could be of the same product or of related product. Lucky Draws are not at all popular among the Indian consumer, reason could be it has element of luck attached with it and consumer does not want to take risk for it.

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Satisfaction after availing these schemes and recommending the same schemes to their friends and relatives

Yes No

Satisfied after availing schemes 116 36

Would you recommend 124 28

124 116

100120140

36 28

20406080

0 Yes No

Satisfied after availing schemes Would you recommend

Interpretation:-

This shows that more than 75% of the consumers who have availed these promotional schemes were satisfied from it. It means that the marketers have been able to hit the right spot which is evident from the satisfaction level shown in this survey. Once a consumer is satisfied with the product and its sales promotion, he will come back and buy the same brand or he may buy larger quantity at first instance.

124 people will recommend these schemes to their friends and relatives. This means even though some people are themselves not satisfied, they will still recommend it. For company a good scheme means not only promotion through that particular scheme but also through Word of Mouth ultimately.

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How many people prefer trying skin care products before using it?

Try before buying

Yes 114

No 38

114

100120

38

20406080

0 Yes No

Interpretation:-

Out of population of 152, 114 people will prefer trying that particular product before buying it. FEM can use this as promotional scheme to make skin care product buyer use their product. Once a consumer tries and likes the quality of the product, he/she may tend to switch the brand as well. Like this FEM will not only gain confidence of its existing customers but will also get new customers as well.

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Findings from the above study are as follows:-

Most of the people visiting modern trade outlets are in the age group of 18 to 35 and

in that as well if we see the number of females arriving is more as compared to men. There is a growing trend of females becoming the decision maker in buying household products.

FEM brand awareness is good. People are aware of the various products lines that are offered by FEM. Even though FEM does not spend much on its Brand building still, through its quality products it has been able to create good reputation in the market.

Most part of the promotion of FEM is done through consumer schemes. FEM is not much dependent on TV Advertisement and other commercial mediums for its promotion, one of the reasons could be before Dabur has taken over FEM, it was not very high capital company.

Most of the users FEM products are females because Bleach, Hair Removal are products which are still not very commonly used among men.

Among the usage of products, Bleach and Hand Wash takes the market. In fact, FEM

is the market leader in Bleach category. Hand Wash being not so popular still tops the survey. I am not really sure how this thing happened because when I was on store visits I noticed that not many people actually preferred FEM Hand Wash.

There is no change required in the pricing of FEM since most people are seem to be satisfied with the current pricing of FEM products. Pricing matches the kind of quality that is being offered by the company.

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Not many people are aware of various promotional methods adopted by FEM. Reasons could be that FEM has never spent large chunk of money on its promotional activities. Whatever has been done, it’s all on a very small scale.

lot of people think FEM’s overall promotional strategy is average as compared tosome of its competitors who spend a lot of money on its promotion.

People who were interviewed think that while promotion for Hand Wash is below average, for other 2 categories; Bleach and Hair Removal its average or above average.

Because FEM’s overall promotional strategy is not very consistent and it does not offer schemes on regular basis, not many people have bought its products under consumer promotion offer.

Sale promotion affects buying behaviour of a lot of people. If offered good scheme

consumer tends to move from its current brand to another brand which is offered with the valuable scheme for consumer.

Most of people prefer monetary schemes over non-monetary schemes, because having conventional thinking people in India wants to save money in the end.

Among the consumers Buy one get one free scheme is very famous as it doubles the

quantity at the same price. Next is discount scheme which again saves money of the buyer.

In the non-monetary category 25% extra and gift pack schemes are very famous. Next is the trial packs. People prefer these above other schemes. 100

If a person likes the scheme, he does tend to recommend it to his friends and relatives, which bring in more consumers and thereby increase volume of sale.

Product Life-Cycle Stage

3 categories of FEM fall under one of the stages of product life cycle.

Hair Removal Cream – According to me, FEM’s hair removal cream is in its Introduction orInfancy stage. Reasons could be, it has not been very long since the time it has been launched and moreover India is still new to the concept of Hair Removal Cream.

Liquid Hand Wash – FEM’s Hand Wash is in its Growth stage. Because hand wash does existin India since long, still a lot of people prefer to use normal soap bricks in the Indian household because it stays for a long time and wastage is also very nominal.

Bleach – FEM’s bleach is also in it Growth stage. Bleaches do exist in the Indian market butits usage is on a rise since last few years.

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RECOMMENDATIONS

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Recommendations

Part 1

To counter the problem of Fill Rate what we can do is, in the purchase order if a particular product is not available we can send the higher quantity of the different size of same product. Example if there is order of 100 units of fem pink bleach in 25 gram and 50 gram each. Now if the 50 gram is not available we can send 50 extra units of 25 gram. By doing this we will not lose the sale and customer since we are substituting his demand to small unit of same product. Other than this, we can also make the forecasting process more accurate so that company is not short of goods.

While retailers concentrate more on the sale Bleach, as it is highest selling product of FEM, they should not avoid other SKUs. We can give them more margins on the sale of Hand Wash and Hair Removal Category. Special retail schemes can also be introduced like, on purchase of 500 units of Hand Wash 100 units free. This will not only motivate the retailer to sale slow moving products but will also increase the sale for the company. Giving special discount schemes and high margins to retailers will also improve relationship between the company and the retail chain.

Regular survey should be done in these retail chains to see, what kind of variant of the product and size of the pack is preferred by the consumers. Feedback and suggestions can be taken through online surveys.

A special dedicated small van should be taken for transport of FEM products to various stores so that FEM order does not have to wait for Dabur supply. Special norms should be laid down and regarding the same contract should be signed with the distributor for supply of products within the time limit.

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Minimum Base Quantity should not be the same throughout the month. Since there is an increase in the footfall of consumers in the first 10 days of the month as compared to the rest of the month. MBQ should be setup in such a way that the supply does not fall short of demand. Example if there are 24 units of bleach ordered, then it should be increased to 36 units. Buffer should also kept in case of sudden increase in demand.

Company should make sure that the distributor is maintaining good hygienic conditions in the warehouse so that spoilage of products can be avoided. Regular check from the company representative should be done to see of the standards are maintained or not.

Purchase order should be send through mail so that the retailer does not have to wait for the company representative to come and collect the order. Sale s person can be provided with palmtops so that they can take order quickly and with ease.

Margin should be setup keeping in view the competitive scenario. Low margins can demotivate the retailer. Healthy margins keep the retailers on their toes and it also motivates them to sell product since that gives them higher margin and higher revenue.

Credit issues should be avoided. Retailer, distributors and company should follow the contract, any conflict should not affect the sale the products.

A notification should be sent to all the distributors and retailers in case company introduces any new product or SKU. Promotional schemes should also be communicated to the retailers through email. Any kind of communication gap should be avoided.

Salesman should not push the product. Special incentives should be given to the salesman on achieving their targets. This will keep the salesman motivated, and those who are unable to achieve targets can be given training to teach them special selling techniques to improve their productivity.

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Recommendations

Part 2

Since major part of the FEM consumers is in the age group of 18 to 35 and in that most of them are females. FEM’s brand and consumer promoti on should be done keeping in my mind segment of Females aging within 18-35.

While this is primary target segment, men of same age group can also targeted because there is a growing trend of use Bleach and Hair Removal Cream among men. If promotion regarding the same can be done, FEM products can be made equally famous among men as well.

FEM’s should concentrate more on the promotion of Hand Wash and Hair Removalsince its sale is still very low as compared to the sale of Bleach.

FEM also needs to keep its promotional activity consistent throughout the year, to make a mark in the mind of the consumers. Once people buy a product under a scheme and if like the quality of the product, then customer’s loyalty towards thatbrand increases.

Since people prefer more of Monetary scheme over Non-Monetary scheme, our strategy should be such that it includes more of monetary scheme and less of Non-Monetary. Company should not concentrate of either of the two but on both of them. Strategy should be made to make use of both the techniques of promotion efficiently.

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According to the Analysis done above related to product life cycle stage of different categories of FEM product. Different promotional methods can be recommended. FEM’s hair removal cream is in its Introductory or Infancy stage. Products

coming under this stage need more of advertising and publicity. Encouraging personal selling and providing trial of hair removal cream can be of highest cost effectiveness. I would recommend schemes like:

1. Buy Hair Removal Jar/Tube 40 gram, get Rs. 7 off 2. Buy 3 packs of Hair Removal and get discount on this month’s

FEMINA magazine 3. Buy Hair Removal and get sachet cleansing cream free.

FEM’s liquid hand wash category falls under Growth stage. In thisadvertising, sale promotion and personal selling all grow more important but above all of them is the power of word of mouth which takes all the momentum of demand. For liquid hand wash I would recommend schemes like;

4. Buy Hand Wash 1liter and get Rs. 20 off 5. Buy Hand Wash 250 ml and get 200 ml pouch free 6. Buy Hand Wash 250 ml and hair remover sachet free

FEM’s bleach category also falls under Growth stage. But since it’s amarket leader and the competition is not that strong. Any kind of Consumer promotion will work for this category

7. Buy Bleach and get cold cream sachet free 8. Buy Bleach and get mud pack free 9. Buy Parlour pack and get Rs 20 off

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CONCLUSION

The Gap analysis in distribution, assortment and MBQ levels and designing the promotion mix strategy were successfully developed and analysed for FEM products naming; Bleach, Liquid Hand Wash and Hair Removal Cream. Certain gaps in the distribution should be given serious consideration by the company. Analysis done on promotion can be helpful in determining the schemes that are preferred by the buyers the most.

Detailed recommendations on both the parts of the projects have been given. Information on improving the various loopholes that exist in the distribution structure has been listed in the report. Some limitations were faced during the collection of data from various sources. But the same has been overcome with the help of Dabur Management and Distributors of Dabur. Various promotional schemes have been provided in the recommendations and the data to validate it as well.

The project was carried out in a good manner and has met the expectations of the organization and the institute satisfactorily, though it still has quite some scope for improvements which could be incorporated subsequently.

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REFRENCES

1. www.google.com

2. www.wikipedia.com 3. http://www.dabur.com 4. http://www.femcareworld.com 5. http://www.supplychainmetric.com 6. http://retail.about.com 7. http://www.citesales.com 8. http://www.bizmove.com/general/m6h5.htm 9. www.docshare.com 10. http://www.indiaprwire.com

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BIBLOGRAPHY

1. Tapan K. Panda; Sunil Sahadev; (2009) Sales and Distribution Management, Oxford

University Press.

2. Tony Yeshin; (2006) Sale Promotion, Thompson Learning

3. Havaldar, Cavale Krishna, Vasant; Sales and Distribution Management, Tata McGraw-

Hill.

4. Don E. Schultz; William A. Robinson; Lisa A. Petrison; (1998) Sale Promotion

Essential, The McGraw-Hill Companies.

5. Chris Brown (1993), The sales promotion handbook, Kogan Page

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nnexure

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Annexure 1

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Annexure 2

112

Annexure 3

113

Annexure 4

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Annexure 5

115

Annexure 6

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Annexure 7

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Annexure 8

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Annexure 9

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Annexure 10

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Annexure 11

FEM Questionnaire

Q1. Are you aware of FEM as a brand?*

Yes No

Q2. How did you come to know about FEM?

TV Advertisement Newspaper Internet Friends and Relatives Store Visit Other

Q3. Have you ever used FEM Products?*

Yes No

Q4. Which of these FEM products have you used? Hand Wash Bleach Hair removal cream Q5. Did you ever experience unavailability of FEM product in general stores? Yes No May Be Q6. Are you satisfied with the pricing of FEM Products? Yes No Q7. Are you aware of the Sale Promotion being done by FEM?* Yes No May Be

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Liquid Hand Wash Poor Below Average Average Good Excellent

Bleach Poor Below Average Average Good Excellent

Hair Removal Cream Poor Below Average Average Good Excellent

Q10. Have ever bought a FEM product under promotion scheme, if yes? Which product?* Yes No If Yes ___________ Q11. Does Sale Promotion really influence your buying behaviour while purchasing any product?* Yes No May Be Q12. Which method of Promotion do you prefer?* Monetary Non-Monetary Q13. What kind of monetary scheme do you prefer?*

Discount (Ex. – Rs. 10 off) Buy 2 get 3rd at 50% Buy one get one Buy family pack and get 25% off

122 Q8. How do you think is FEM's overall sale promotion strategy?* Poor Below Average Average Good Excellent Q9. Rate the promotion done by FEM for each of the below mentioned products*

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Q14. What kind of Non-Monetary scheme do you prefer?* Gifts 25% extra scheme Lucky draws Trial Packs Q15. Were you satisfied after availing these Promotional Schemes?* Yes No Q16. Do you recommend your friends and relatives to avail these promotional schemes?* Yes No Q17. If not, please specify why? Q18. Do you prefer to try skin care product before buying them?* Yes No Q19. Gender* Male Female Q20. Occupation* Student Self Employed Service House Wife Other Q21. Age* <18