Planning & Budgeting for ITC retails

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  • 1. Presented to Mr. Soumen Mukerji By Amit Kumar Nishant Jain Samik Gupta Siddharth Dixit1 Praxis Business School1/16/2013

2. Feedback2 Praxis Business School1/16/2013 3. Enterprise Performance Management Cycle3 Praxis Business School 1/16/2013 4. Overview Indian retail apparel industry is $33 bn in 2011 and poised to growto $100 bn in next 10 years Apparel exports $23.5 bn The apparel division of ITC consists of Wills Lifestyles WillsClassic work wear, Wills sport relaxed wear, Wills club life eveningwear It has also established John player and Miss player as brands whichhas 225 stores across the country The lifestyle retailing division of ITC is fortifying its brands andexpanding its retail reach During 2010-11 the brand reach was expanded to 73 exclusivestores in 40 cities and more than 150 shop-in-shops in leadingdepartmental stores4 Praxis Business School1/16/2013 5. Business Model-RetailSupplier PlanningSales/Point of Sales Sales planningVendor management Pricing managementPoint-of-sales managementCost and deal management Promotion managementE-paymentPurchase order management Customer profilingContent managementCollaborative management Assortment management Online retailing Category management Purchase ProcessCustomerSupply chain visibilityCustomer loyalty managementWarehouse management Voucher gift managementTransportation managementCustomer ordering management Track and AnalyseStore/Shelf ManagementEfficiency ManagementGeneral ledger and accountStore planningmanagement Process improvementInventory managementSales audit and invoicematching Six sigma implementationReplenishment management Radio FrequencyWorkforce managementFresh item managementIdentification (RFID)Payroll processing implementationItem publishingSales analysis and lossEnterprise securityOrder management Praxis Business School prevention1/16/20135 6. Strategy DistributionStepping inLow Cost Cost Through shop-in- shop the kidsapparelsleadership Through discount storesgarments Exports6Praxis Business School 1/16/2013 7. 4 Ps Products Menswear,female wear and kids wear Usage of 80s ply non giza cotton and carded cotton Price Well multiply our base wholesale cost by a factor of 2.5, ageneral industry cost rule This will represent all unexpected cost escalations and includesprofit7 Praxis Business School1/16/2013 8. Continued.. Promotion Print media advertisement , digital media advertisement,billboards Brand endorsement through existing campaigns Promotion in existing stores Place 5 pilot discount stores to start with, in Tier-II cities Consideration of easy raw material and finished goodsavailability Through shop-in-shops8 Praxis Business School 1/16/2013 9. Manufacturing to Distribution Process9 Praxis Business School 1/16/2013 10. Profit share distribution With outsourcing we forgo 13% With discount stores distribution cost saved gets passed on to the end consumers10 Praxis Business School 1/16/2013 11. Operations Of Pilot Stores and aAmritsar Warehouse ChandigarhJaipur Delhi Agra11 Praxis Business School 1/16/2013 12. Product Specialisation Cluster Location Stitching/RMG/Hosiery Delhi, Noida Powerloom Amritsar Woolen Knitwear Ludhiana RMG/ Hand processingJaipur HandloomAmritsar Avg. household CityPopulationincome (Rs.) Chandigarh960,787 99,262 Amritsar1,132,761 33,043 Ludhiana1,613,878 36,868 Delhi11,007,835135,820 Noida293,90838,860 Jaipur3,073,350 35,75412Praxis Business School1/16/2013 13. Alignment of programmatic objectiveswith budgeting Flow of Top Down information Bottom Up Make Vs Buy Measurable Distributions Metrics Promotions13 Praxis Business School 1/16/2013 14. Continued.Sales Product linesInformation Regions and specific locations Customer profiling Direct cost-Raw material , labor & inventory, supplier expenses Indirect cost- Selling & distribution, Expensedesigning, administrative expenses Information Fixed cost- Establishments, rent, depreciation Variable cost- Includes many of the direct costs14Praxis Business School 1/16/2013 15. Continued. Overall economic health Projections Inflationon Interest rateseconomic climate Consumer confidence Political stability The final step would be to determine break-even on own discount stores15Praxis Business School 1/16/2013 16. Thank You16 Praxis Business School 1/16/2013