An Irate Distributor

A Distribution Case Study Presentation

Evolution of Indian Retail
Background of Retail Trade in India
India is ranked fifth in the Global Retail
Development Index in 2012
Indias strong growth fundamentals
along with increased urbanisation and
consumerism opened immense scope
for retail expansion for foreign players
Recent government reforms for
attracting FDI and boosting investor
sentiment
Rapid emergence of organised retail
outlets like mega malls and
hypermarkets are augmenting the
growth of organised retail in the country
Constant improvements in supply chains
and logistics by retailers for competitive
advantage and meeting consumer
demands

FMCG Distribution
Development of Tier II and III
Cities
Compete with
Metropolitan Cities
Spread of middle-class
growth beyond Tier I Cities
Need for businesses
Focus on rural sector (2/3
rd

population)
Reach deepest parts of the
country
Ensure product availability


Geographic Diversity
Multitude of Retail Formats
Small Family-Managed Shops
Grocers
Paan Shops
Hawkers
Supermarkets
Teleshopping
Culture Diversity
6 million retail outlets
4 to 5 levels of intermediaries
Margins distributed at all levels

Why Jalgaon?

Sole distributor Easy to implement the
change.
Lagging on sales vis a viz the central region.
Lagging on number of outlets covered
(weighted distribution method)
Business by jalgaon against population is less.
High potential for growth second highest
population, third highest per capita income.



Amit Kumars Situation
FMCG Sector valued at $13.1 billion, expected to grow to $33 billion
by 2015
Increasing Disposable Income
Increase in consumption
Better service expectancy from distributors
Strong MNC presence
Processed Food and Nutritional Food Industry to grow to $200
billion by 2015
HFD CAGR at 25% and penetration at 45%



Nutripack India
Established in 1994
CAGR of 18% (vs global CAGR of 8%)
Turnover of INR 7.5 Billion and 600 Employees
NutriPower
12%
Market
Share
INR 27
Billion
CAGR of
25%
NutriJams
10%
Market
Share
INR 1.37
Billion
Glucolin
34%
Market
Share
INR 1.28
Billion
Honeybeez
29%
Market
Share
INR 0.87
Billion
Kumars Perspective- Reach
Low Margins High Volumes
Have a wide reach so as to cover as many villages as possible
2nd most populous district in Central Maharashtra
16% volume share but 8% contribution
Interior markets need to be serviced well in terms of-
Extending the credit
Uniform discounts and schemes
Regular market visits
Mandores Perspective- Profitability
Largest distributor in Central Maharashtra
Veteran in the FMCG distribution business
Content to meet companys targets
Maintains good relationship with major retailers
Would like certain issues to be addressed before making
further investments-
Pending secondary claims
Low distributor margin
How will you convince Mandore?

The return he gets by staying with
nutripack is 39.12% as compared to 10.5%
from peoples bank.
Increased reputation.

Recommendations
Increase the resources as shown in the previous
excel file.
Uniform schemes and cash discounts across all
outlets of similar value.
Increase personal visits to retailers.