Sales and Distribution Assignment
Content
Sales & Distribution Assignment On
ITC Agri Business & Foods Distribution Wonders.
Submitted by:
Anush Sadu
Objective:
To understand the:
1.
2.
3.
4.
5.
The ITC Conglomerate as a whole
ITC E-Choupal
ITC FMCG & Agri Business Environment
Distribution Prior to E-Choupal.
E-Choupal Distribution Model
Introduction
ITC is India' one of the leading private co. with a market capitalization of $19 Bn and a
turnover of more than $ 5 Bn. It has a diversified presence in many of the products like
cigarettes ,Hotels ,Hospitality etc.ITC's diversified state originates from its corporate strategy
aimed at creating a multiple drivers of growth anchored on its time-tested core competencies,
unmatched distribution reach ,Superior brand building capabilities, efficient SCM and
excellent service skills.
The following are ITC's SBUs :
FMCG
-
Cigarettes & Cigars
-
Foods
-
Lifestyle Retailing
-
Personal Care
-
Education and Stationery
-
Safety Matches
Agarbattis
Hotels
Paperboards & Specialty Papers
Packaging
Agri Business
-
Agri Commodities & Rural Services
-
Agri Business-ILTD
-
e-Choupal
It is ITC's strategic intent to secure long-term growth by synergising and blending the diverse
pool of competencies residing in its various businesses to exploit emerging opportunities in
the FMCG sector.
The Company's institutional strengths - deep understanding of the Indian consumer, strong
trademarks, deep and wide distribution network, agri-sourcing skills, packaging know-how
and cuisine expertise - continue to be effectively leveraged to rapidly grow the new FMCG
businesses.
ITC has rapidly scaled up presence in its newer FMCG businesses comprising Branded
Packaged Foods, Lifestyle Retailing, Education and Stationery products, Personal Care
products, Safety Matches and Incense Sticks (Agarbatti), at an impressive pace over the last
several years, crossing Rs. 9000 crore mark in 2015.
The Company's unwavering focus on quality, innovation and differentiation backed by deep
consumer insights, world-class R&D and an efficient and responsive supply chain will further
strengthen its leadership position in the Indian FMCG industry
ITC Agri Business :
What made this business flourish ? The quality of the produce being reached the end final
customer of the ITC.
How they achieved it ? An efficient distribution channel that revolved around the
disintermediation process in the distribution system to gain maximum value in terms of the
agricultural produce and ensuring the farming output in line with the quality requirement of
ITC for export purpose direct from the farmers surpassing the intermediaries like , Local
village Mandis , Stockist , Warehouse managers etc to directly source from the farmers
empowering them and satisfying them in all means to align their interest with the interest of
ITCs. This was achieved through an efficient and path breaking Distribution system and
initiative called e-Choupal .
e-Choupal
ITC's pre-eminent position as one of India's leading corporates in the agricultural sector is
based on strong and enduring farmer partnerships that has revolutionized and transformed the
rural agricultural sector. A unique rural digital infrastructure network, coupled with deep
understanding of agricultural practices and intensive research, has built a competitive and
efficient supply chain that creates and delivers immense value across the agricultural value
chain. One of the largest exporters of agri products from the country, ITC sources the finest
of Indian Feed Ingredients, Food Grains, Marine Products, Processed Fruits & Coffee.
ITC's Agri Business Division is the country's second largest exporter of agri-products. It
currently focuses on exports and domestic trading of:
Feed Ingredients - Soyameal
Food Grains - Wheat & Wheat Flour, Rice, Pulses, Barley & Maize
Marine Products - Shrimps and Prawns
Processed Fruits - Fruit Purees/Concentrates, IQF/Frozen Fruits, Organic Fruit
Products
Coffee
ITC's unique strength in this business is the extensive backward linkages it has established
with the farmers. This networking with the farming community has enabled ITC to build a
highly cost effective procurement system. ITC has made significant investments in webenabling the Indian farmer. Christened 'e-Choupal', ITC's empowerment plan for the farmer
centres around providing Internet kiosks in villages. Farmers use this technology
infrastructure
to
access
on-line
information
from
ITC's
farmer-friendly
website www.echoupal.com Data accessed by the farmers relate to the weather, crop
conditions, best practices in farming, ruling international prices and a host of other relevant
information. e-Choupal today is the world's largest rural digital infrastructure.
The unique e-Choupal model creates a significant two-way multi-dimensional distribution
channel which can efficiently carry products and services into and out of rural India, while
recovering the associated costs through agri-sourcing led efficiencies. This initiative now
comprises about 6500 installations covering nearly 40,000 villages and serving over 4
million farmers. Currently, the 'e-Choupal' website provides information to farmers across
the 10 States of Madhya Pradesh, Haryana, Uttarakhand, Uttar Pradesh, Rajasthan,
Karnataka, Kerala, Maharashtra, Andhra Pradesh and Tamil Nadu.
Supporting the e-Choupal network are ITC's procurement teams (Sanchalaks , Inspection
team), handling agents (Samyojaks) and contemporary warehousing facilities across India,
enabling its Agri Business to source identity-preserved merchandise even at short notice.
ITC's processors are handpicked, reliable high quality outfits who ensure hygienic processing
and modern packaging. Strict quality control is exercised at each stage to preserve the natural
flavour, taste and aroma of the various agri products.
The Traditional distribution channel from Farm to fork :-
ITC DISTRIBUTION CENTREs
EXPORT DOCKS
DEALERS
WHOLESALERS
International Customers
RETAILERS
Post E-Choupal Implementation
ILLITERATE FARMER
LITERATE FARMER (Sanchalak)
Heart of E-Choupal facilitator
to farmers
ITC Storage HUBS in a pool of
Villages
Point of
Disintermediation
ITC Manufacturing Unit
ITC Regional Distribution
Centres
EXPORT HUBS
International Clients (Cargill,
Marubeni, Toepfer)
E-Choupal Supply Chain Process
Regional Retailers
Sanchal
Farmers
ak sets
Transpor
the
t their
base
produce
price
to the
using eStorage
choupal
PERKS of E-ChoupalCommis
Adoption
IT
sion
ITC
Official
does
quality
inspectio
n
finalises
the price
post
Outboung
payment
logistics nd
of worth
distribution
to
from factory
farmer
to Export
transpor
hubs &
ted to
regional
manufac
retailers .
Agents
ture
hub
Traditionally, ITC, like all packaged goods companies in India, stocks products at its
(Samyoj
distribution centres. Products
first go to its exclusive wholesale dealers, then distributors and
ak)
direct retailers. In some areas, mostly in rural India, the big retailers supply products to
smaller retail outlets. The entire process takes anything from one week to three weeks,
depending on the distance between the retail outlet and the factory.
ITC with its efficient e-Choupal direct distribution system could bring down the availability
and distribution of its branded agricultural products overseas and regional retailers in a matter
of couple of days.
ITC Agri Business (E-Choupal) Customer Centricity
Following the success of the e-Choupal, the Company launched Choupal Saagar, a physical
infrastructure hub that comprises collection and storage facilities and a unique rural
hypermarket that offers multiple services under one roof. This landmark infrastructure, which
has set new benchmarks for rural consumers also incorporates farmer facilitation centres with
services such as sourcing, training, cafeteria, banking, investment services, fuel station etc. 24
'Choupal Saagars' have commenced operations in the states of Madhya Pradesh,
Maharashtra and Uttar Pradesh.
The Sales Impact
Through its efficient cost effective direct disruptive distribution could achieve operational
efficiency , quality amd economies of scale at a triple bottom line startegy through its eChoupal distribution model.This has led to an increase in the revenue for ITC from 09% in
2007 to 17% in 2015 with a gross contribution of around 600 Mn USD.
SoyaBeans and Corn produce have been manufactured and processed by ITC factories at
optimul conditions to price the produce at retail less than the price of any other competitors.
ITC Aashirwaad atta has reached the retailers in premium quality at cost Rs 10 less than
competitor premium brands like Pillsbury etc.
ITC Agri Business & Foods Distribution Wonders.
Submitted by:
Anush Sadu
Objective:
To understand the:
1.
2.
3.
4.
5.
The ITC Conglomerate as a whole
ITC E-Choupal
ITC FMCG & Agri Business Environment
Distribution Prior to E-Choupal.
E-Choupal Distribution Model
Introduction
ITC is India' one of the leading private co. with a market capitalization of $19 Bn and a
turnover of more than $ 5 Bn. It has a diversified presence in many of the products like
cigarettes ,Hotels ,Hospitality etc.ITC's diversified state originates from its corporate strategy
aimed at creating a multiple drivers of growth anchored on its time-tested core competencies,
unmatched distribution reach ,Superior brand building capabilities, efficient SCM and
excellent service skills.
The following are ITC's SBUs :
FMCG
-
Cigarettes & Cigars
-
Foods
-
Lifestyle Retailing
-
Personal Care
-
Education and Stationery
-
Safety Matches
Agarbattis
Hotels
Paperboards & Specialty Papers
Packaging
Agri Business
-
Agri Commodities & Rural Services
-
Agri Business-ILTD
-
e-Choupal
It is ITC's strategic intent to secure long-term growth by synergising and blending the diverse
pool of competencies residing in its various businesses to exploit emerging opportunities in
the FMCG sector.
The Company's institutional strengths - deep understanding of the Indian consumer, strong
trademarks, deep and wide distribution network, agri-sourcing skills, packaging know-how
and cuisine expertise - continue to be effectively leveraged to rapidly grow the new FMCG
businesses.
ITC has rapidly scaled up presence in its newer FMCG businesses comprising Branded
Packaged Foods, Lifestyle Retailing, Education and Stationery products, Personal Care
products, Safety Matches and Incense Sticks (Agarbatti), at an impressive pace over the last
several years, crossing Rs. 9000 crore mark in 2015.
The Company's unwavering focus on quality, innovation and differentiation backed by deep
consumer insights, world-class R&D and an efficient and responsive supply chain will further
strengthen its leadership position in the Indian FMCG industry
ITC Agri Business :
What made this business flourish ? The quality of the produce being reached the end final
customer of the ITC.
How they achieved it ? An efficient distribution channel that revolved around the
disintermediation process in the distribution system to gain maximum value in terms of the
agricultural produce and ensuring the farming output in line with the quality requirement of
ITC for export purpose direct from the farmers surpassing the intermediaries like , Local
village Mandis , Stockist , Warehouse managers etc to directly source from the farmers
empowering them and satisfying them in all means to align their interest with the interest of
ITCs. This was achieved through an efficient and path breaking Distribution system and
initiative called e-Choupal .
e-Choupal
ITC's pre-eminent position as one of India's leading corporates in the agricultural sector is
based on strong and enduring farmer partnerships that has revolutionized and transformed the
rural agricultural sector. A unique rural digital infrastructure network, coupled with deep
understanding of agricultural practices and intensive research, has built a competitive and
efficient supply chain that creates and delivers immense value across the agricultural value
chain. One of the largest exporters of agri products from the country, ITC sources the finest
of Indian Feed Ingredients, Food Grains, Marine Products, Processed Fruits & Coffee.
ITC's Agri Business Division is the country's second largest exporter of agri-products. It
currently focuses on exports and domestic trading of:
Feed Ingredients - Soyameal
Food Grains - Wheat & Wheat Flour, Rice, Pulses, Barley & Maize
Marine Products - Shrimps and Prawns
Processed Fruits - Fruit Purees/Concentrates, IQF/Frozen Fruits, Organic Fruit
Products
Coffee
ITC's unique strength in this business is the extensive backward linkages it has established
with the farmers. This networking with the farming community has enabled ITC to build a
highly cost effective procurement system. ITC has made significant investments in webenabling the Indian farmer. Christened 'e-Choupal', ITC's empowerment plan for the farmer
centres around providing Internet kiosks in villages. Farmers use this technology
infrastructure
to
access
on-line
information
from
ITC's
farmer-friendly
website www.echoupal.com Data accessed by the farmers relate to the weather, crop
conditions, best practices in farming, ruling international prices and a host of other relevant
information. e-Choupal today is the world's largest rural digital infrastructure.
The unique e-Choupal model creates a significant two-way multi-dimensional distribution
channel which can efficiently carry products and services into and out of rural India, while
recovering the associated costs through agri-sourcing led efficiencies. This initiative now
comprises about 6500 installations covering nearly 40,000 villages and serving over 4
million farmers. Currently, the 'e-Choupal' website provides information to farmers across
the 10 States of Madhya Pradesh, Haryana, Uttarakhand, Uttar Pradesh, Rajasthan,
Karnataka, Kerala, Maharashtra, Andhra Pradesh and Tamil Nadu.
Supporting the e-Choupal network are ITC's procurement teams (Sanchalaks , Inspection
team), handling agents (Samyojaks) and contemporary warehousing facilities across India,
enabling its Agri Business to source identity-preserved merchandise even at short notice.
ITC's processors are handpicked, reliable high quality outfits who ensure hygienic processing
and modern packaging. Strict quality control is exercised at each stage to preserve the natural
flavour, taste and aroma of the various agri products.
The Traditional distribution channel from Farm to fork :-
ITC DISTRIBUTION CENTREs
EXPORT DOCKS
DEALERS
WHOLESALERS
International Customers
RETAILERS
Post E-Choupal Implementation
ILLITERATE FARMER
LITERATE FARMER (Sanchalak)
Heart of E-Choupal facilitator
to farmers
ITC Storage HUBS in a pool of
Villages
Point of
Disintermediation
ITC Manufacturing Unit
ITC Regional Distribution
Centres
EXPORT HUBS
International Clients (Cargill,
Marubeni, Toepfer)
E-Choupal Supply Chain Process
Regional Retailers
Sanchal
Farmers
ak sets
Transpor
the
t their
base
produce
price
to the
using eStorage
choupal
PERKS of E-ChoupalCommis
Adoption
IT
sion
ITC
Official
does
quality
inspectio
n
finalises
the price
post
Outboung
payment
logistics nd
of worth
distribution
to
from factory
farmer
to Export
transpor
hubs &
ted to
regional
manufac
retailers .
Agents
ture
hub
Traditionally, ITC, like all packaged goods companies in India, stocks products at its
(Samyoj
distribution centres. Products
first go to its exclusive wholesale dealers, then distributors and
ak)
direct retailers. In some areas, mostly in rural India, the big retailers supply products to
smaller retail outlets. The entire process takes anything from one week to three weeks,
depending on the distance between the retail outlet and the factory.
ITC with its efficient e-Choupal direct distribution system could bring down the availability
and distribution of its branded agricultural products overseas and regional retailers in a matter
of couple of days.
ITC Agri Business (E-Choupal) Customer Centricity
Following the success of the e-Choupal, the Company launched Choupal Saagar, a physical
infrastructure hub that comprises collection and storage facilities and a unique rural
hypermarket that offers multiple services under one roof. This landmark infrastructure, which
has set new benchmarks for rural consumers also incorporates farmer facilitation centres with
services such as sourcing, training, cafeteria, banking, investment services, fuel station etc. 24
'Choupal Saagars' have commenced operations in the states of Madhya Pradesh,
Maharashtra and Uttar Pradesh.
The Sales Impact
Through its efficient cost effective direct disruptive distribution could achieve operational
efficiency , quality amd economies of scale at a triple bottom line startegy through its eChoupal distribution model.This has led to an increase in the revenue for ITC from 09% in
2007 to 17% in 2015 with a gross contribution of around 600 Mn USD.
SoyaBeans and Corn produce have been manufactured and processed by ITC factories at
optimul conditions to price the produce at retail less than the price of any other competitors.
ITC Aashirwaad atta has reached the retailers in premium quality at cost Rs 10 less than
competitor premium brands like Pillsbury etc.
