Ashwin-Annapurna Traders

DECLARATION
I here by certify that this project report entitled “Distribution Channels

and retailers satisfaction level at Annapurna traders”, has been
prepared by me under the able guidance and supervision of Prof. Jai
Raj Nair, Professor, M.P. Birla Institute of Management , Associate
Bhartiya Vidya Bhavan, Bangalore.
This project report was prepared by me in partial fulfillment of the

requirement for the award of MBA Degree. I also declare that this
project report has not been submitted to any other University or
Institution for the award of any Diploma or Degree.
Date: 13/09/2004
Place: Bangalore
ASHVIN S. HALBHAVI
Reg. No.: 02XQCM6010
TABLE OF CONTENTS
CHAPTER CONTENTS PAGE NO.
NUMBER
1 EXECUTIVE SUMMARY 1
2 INTRODUCTION
¾ Introduction to subject
¾ Introduction to the biscuit
industry 3
3 REVIEW OF LITERATURE
¾ Purpose
¾ Suggestions and conclusion 33
4 RESEARCH METHODOLOGY
¾ Type of research
¾ Sampling technique 59
¾ Collection of data
¾ Limitations of study
5 ANALYSIS & 65
INTERPRETATION OF DATA
6 CONCLUSION 75
7 ANNEXURES
¾ Bibliography 76
¾ Questionnaire
EXECUTIVE SUMMARY
The forces of globalization and technological change have opened up new

opportunities as well as change to the industries, to serve the needs of the commercial
enterprise, government organization, and institutions. As the markets are changing
rapidly, the companies are pushing appropriate distribution strategy, to meet the current
market and the new challenges. Today the economy is changing its pace shifting
economic needs. To suit these needs the Britannia industries limited is performing its
tasks through the various channels to provide the needs of biscuit industry.
.
Annapurna Traders
Annapurna Traders are the stockiest of Britannia products for Hubli city and surrounding
towns. Annapurna traders started functioning from the year 1997.It has its administrative
office at Hubli and a huge stockyard to meet the needs of the end-users. It has rural point
depots in the towns surrounding Hubli city where it maintains minimum stock at any
point of time. Rural point depots cater to the needs of town people and consist mainly of
glucose brands.
The study was conducted with following objectives:

¾To study the distribution channels of the company.
¾To know the satisfaction level with Britannia industries.
¾To know which factors help retailers to push the products.
¾To know the rate of satisfaction received from Annapurna traders.
From the research it is concluded that the distribution channel of the Britannia
play a vital role in success & survival of the brand. Britannia Industries Ltd., by adopting
right distribution process for products & also by the Kind of intermediaries. Company
can concentrate on factors like appointment of the dealers/ distributors, their
remunerations method, terms of payment etc.
Britannia is market leader. Parle is the main competitor for Britannia.
Concentration has to be given on the glucose Biscuit Tiger brand. The premium segment
(varieties) of Britannia is doing very well. Margin, brand Image, credit facility,
advertisement will help retailers to push the products. Retailers also want some offers to
attract the consumers .
OBJECTIVES OF RESEARCH.
RESEARCH METHODOLOGY
Research methodology pertains to the information relating to the data
that is collected either from primary sources or secondary sources. This also
explains the method utilized in data collection, the instrument used and the
sampling plan.
STUDY OF THE PROBLEM

The research at early stage shows the general nature of the problem. The latter
descriptive research discovers, to what extent Retailers are satisfied with Britannia
industries limited.
FOOD INDUSTRY
Food industry contributes to about 18 % of India’s manufacturing Output and

around 5 % of total industrial investment. The estimated turnover of this highly
heterogeneous food and beverage industry exceeds Rs570 bn. Niche segments
comprising packaged and branded food products have recently witnessed rapid growth
accompanied by intense competition .As much as, 52 % of Indian household budget is
spent on food items and the share of processed food products entering the market is
expected to rise rapidly.
The food industry also assumes significance owing to India’s Sizable agrarian
economy, which accounts for over 35% of GDP and Employs around 65 per cent of the
population. Nevertheless, the extent of Food processing (share of processed food in total
raw food available in the Country) is way below international standards is very low. For
instance, only 0.6 % of fruits and vegetables and about 50 % of milk production is
currently processed
Both in terms of foreign investment and number of joint ventures/foreign
collaborations, the consumer food segment has the top priority.Inyear2003Rs20870 mn
foreign investment had been proposed. Deep-sea fishing and aquaculture, milk and milk
products, meat and poultry segments attracted attention of foreign investors, interest is
also growing in fruit and vegetable processing and grain/ cereal based products. By
1995Q3 the total proposed investment was estimated to be Rs 4, 90,000 mn (since July
1991) though actual investment is much lower.
INTRODUCTION TO BISCUIT INDUSTRY
India is the World’s second largest biscuit industry (after

China) . Biscuits are one FMCG category that has been on steady growth path even as
most others have been sliding. The category grew 10.3 per cent by value and 11.6 per
cent by volume for the Jan-Dec 2002 period.
According to Federation of Biscuit Manufacturers, the per capita consumption in
India is about 1.2 Kg per annum, compared to 15 kg per Annum in developed countries.
Several M.N.C.s tried entering the biscuit segment but failed due to the existence of
unorganized players in the popular segment of the market. But now there are many
players preparing to set up shop including the likes of United Biscuits and Nestle. But
such players will Have to tackle Britannia in the premium market and competing with
Parle will never be easy in the popular biscuit market in India.
In the overall biscuit market, Britannia and Parle are two major Players with 15
% and 10 % market shares respectively. In the organized Biscuit market, Britannia has
close to 40% market share, while Parle has around 30% share, remaining is distributed
among Bakeman’s, SmithKline with its horlicks and boost brands and other players like
Nutriene (now acquired by Sara Lee), Kwality , Priya gold duke etc.
Having just two national players, Parle and Britannia, the prices have remained
almost constant for the past few years in most categories and in Some categories the
prices have actually decreased to 1997-98 levels. As per The study, the market is even
now dominated by basic biscuit categories such as glucose and marie which ‘aim to
satisfy hunger’ and have little success in moving up the value chain. Parle in Mumbai has
always adopted the Philosophy of being low key with an endeavor to give value for
money. This Biscuit and confectionery major has in fact not bothered to raise the price of
Its flagship brand for the past six years and has always tried to provide its offerings at
nearly 33 per cent discount to competitive brands.
It is Britannia which is expected to have a greater value share among Biscuits due
to its premium offerings and continues to hold a dominant position in the Rs 35-crore,
2,000 tons per annum premium biscuit market while Parle reigns over the popular biscuit
market with its flagship brand, Parle-G.
Stiff competition from smaller players is eating into the market share of biscuits
major Britannia Industries in segments like milk, salt crackers and cookies biscuit
volumes in absolute terms dropped year-on-year by 2.5% in milk, 2% in cookies, and
4.5% in salt creckers, even as the company registered healthy growth rates in the cream
and glucose segments at 6% and 13%, respectively, during January – June’02. Smaller
regional players such as Anmol Bakers and Surya Food & Agro (Priya Gold brand) are
slowly making a dent in both Britannia and market leader Parle’s shares . These players
are generating sizeable volumes in cookies, creams and the salt Crackers segments. The
year- on –year fall in Britannia’s volume market share is most noticeable in cookies,
which slipped to 55.7% from 75.9%; and in salt crackers, declining to 15.2%from 20.1%
during January –June’02, compared with January -June’01. To beat competition, Britannia
is focusing on growing volumes rapidly in the mass market by aggressive pricing and
expanding the Tiger franchises.
Over the long-term, the relative share of unorganized sector is expected to decline
gradually. Existing players with strong brands and established distribution networks will
continue to expand their market. New Players will have the daunting task of setting up a
distribution network Besides adopting their products to meet the taste preferences of
local consumer. The new entrants are likely to enter into distribution arrangement with
established domestic food companies.
BISCUIT MARKET
RS.3000 crore biscuits industry is one the fast growing sector of FMCG industry.
Many of its characteristics are somewhat different from other sector that makes it
interesting to study the dynamics of the market. This is according to a study done by
market search by a Mumbai based market research agency.
MONOPOLY
Although at all levels there just two players, Parle and Britannia, a closer look at
the state-level market shows the presence’s of Strong regional players such as Bake
man’s Priya Gold, Shalimar’s Windsor and champion – brands present in almost all
market. Thus for the two national players, each state market is similar to a perfectly
competitive market, each with its dynamics.
The competitive scenario at the national level is more of a disguised duopoly than
a real one. This has held the prices in check for a long time.
PURCHASES BEHAVIOR
A slew of successful gift offers/schemes from the biscuit marketers over the last
two years has led to a situation where the choice of brand driven by the gift solely and not
by the brands . More and more marketing budgets are being spent on below-the-line
promotion and less on brand building. According to the research, the delivery efficiency
of schemes and gift offers help the retailers to push the products fast.
Indian FMCG market is just about 60 per cent. Leaving the rest of Potential
customers disappointed with the brand.
Apart from the long-term damage to the brands, these gift-laden scheme have
started damaging the brand in the short term and even the indifference of their
distribution channels at times leads to pilferage of these gifts.
Packaging
However, biscuits’ p ackaging has undergone a swift transformation. From
Britannia’s functional protective blister wraps, which prevent Breakage, to Parle’s stylish
and enticing offering, packaging has been completely transformed. Both the players are
trying to differentiate their brands to reflect their superior quality through superior
packaging. This Up-gradation in packaging has been neutralized by multi-unit packaging,
Thereby effectively neutralizing the potential premium for superior Packaging.
Discounts
The other trend in this industry is the competitive discounting of popular and
premium brands. This trend has not spared even the large brands, such as Parle G. Such
competitive discounting, even on low-value products such as Glucose biscuits, has led to
stagnation of top line and erosion of bottom line. The impact of this is being felt in the
biscuit markers inability to invest in brand building activities and thus move the market
away from the low-Priced basic categories to the middle and high-end ‘snacking’ and
‘indulgence’ -driven categories.
While the Indian market is moving towards superior products in all categories,
biscuits are the odd ones out, sticking to basic products in its own category. There is still
scope to finely segment the market through different Value propositions in taste, need
and image, as per the latest report on the Biscuit dynamics prepared by market Search.
Consumer Habits And Practices
A sizable volume of biscuits is consumed at small roadside tea shops/ stalls

across the country. A bulk of their requirement is met by unorganized sector and typical
consumers are truck drivers/ travelers. Biscuits are also available at the stalls in railway
stations. Premium (specialty) biscuits are more popular in urban areas and are consumed
as breakfast and also with tea in the afternoon. Brand loyalties are relatively stronger in
the popular segment whereas in the premium segment, consumers look for novelty and
change. There are significant variations in consumption habits in different parts of the
country. Glucose biscuit, typically consumed with milk, are more popular in the West and
the North, which incidentally are milk surplus regions. Milk biscuits (with proposition of
milk as ingredient) are more popular in the south and east, which are milk deficit regions.
Arrowroot is more popular in the East whereas Marie (low sugar) biscuits have a higher
penetration in the South. Grocery shops, general stores and other retail outlets sell
biscuits predominantly. However, relative share of impulse purchase in this category is
not very significant. In relative terms, penetration of biscuit is higher in rural markets as
compared to bread. Rural market with 75% of population, accounts for 40% of bread
consumption and about 50% of biscuit consumption.
ENVIRONMENT ANALYSIS
Higher excise duty and the general recession in the economy have affected the
biscuit industry in India. Biscuit companies are levied a cumulative 33 percent indirect
tax, which is among the highest in the world. According to Federation of Biscuit
Manufacturers of India, the industry has witnessed zero growth recently and the growth
was 3 percent for 2003-04.Britannia Industries Ltd., with a turnover of Rs500 crore, is the
market leader in the Rs1, 200 crore worth organized sector of the biscuit industry. Parle,
with a turnover of Rs400 crore, and Bake man’s with a turnover of Rs200 crore, closely
follow. Despite the rising cost of inputs, the biscuit manufacturers are not able to raise the
prices due to the price elastic nature of the product. The industry also faces competition
from the unorganized sector, which offers cheap alternatives. The industry also faces
problems like high tariffs on imported machinery and high duty on raw materials.
However the government encourages export as it brings invaluable foreign exchange.
Many local companies therefore focus on international markets rather than the domestic
market as export market is more lucrative. As a part of the external analysis certain
identified aspects associated with the biscuit industry were studied.
Low capital intensity:

The biscuit industry in general requires relatively minor investment in plant and
machinery and other fixed assets. Therefore shortage of product for want of capacity is
rare phenomenon. The turnover is typically five to eight times the investment made in a
Greenfield plant at full capacity. This is also due to the fact that the business being
marketing driven, players do not integrate backward. Also, the business has low working
capital intensity as bulk of sales from manufacturers takes place on a cash basis.
High initial launch cost:

Nonetheless, there is a large front-ended investment made in new products
including cost of product development, market research, test marketing and most
importantly its launch. To create awareness and develop franchise for a new brand
requires enormous initial expenditure is required on lunch advertisements, free samples
and product promotions. Launch costs are as high as 50-100% of revenue in the first year
and further these costs progressively reduce as the brand matures, gains consumer
acceptance and turnovers increases. For established brand, advertisement expenditure
varies from 5–12% depending on the categories. It is common to give occasional ‘push’
by re launches, which involves repositioning of brands with sizable marketing support.
Marketing driven:
In relative terms, marketing function has greater importance in the biscuit
companies. The players have to reach out to mass population and compete with several
other brands. The perceived differences are greater than the real differences in the
product.
Market research:
Consumer’s purchases decisions are based on perceptions about b rands. They also
keep on changing with fashion, income and changes lifestyle. Unlike industrial products,
it is difficult to differentiate products on technical or functional grounds. With increasing
competition, companies spend enormous sums on product launches. Market research and
test marketing become inevitable. The business rests on the two pillars of brand equity
and distribution network.
Brand equity:
Brand equity refers to the intangible asset in the form of brand names. The
consumer’s loyalty for a particular brand is due to the perception that the product has
distinctively superior and consistent quality, satisfies His/her specific needs and provides
better value for money than other competing brands. A successful brand generates strong
cash flow that enables the owner of the brand to reinvest a part of it in the form of
aggressive advertisement/-promotion to reinforce the perceived superiority of the brand.
The worth of a brand is manifested in the consumer’s insistence on a particular brand or
willingness to pay a price premium for the preferred Brand.
Distribution network:
In this sector, one of the most critical success factors is the ability to Build,
develop, and maintain a robust distribution network. Availability near The consumer is
vital for wider penetration as most products are low unit value products and frequently
purchased. Distribution network refers to the consumer buying points where products are
available (almost always). It takes enormous time and effort to build a chain of stockiest,
retailers, dealers Etc and establish their loyalties. There are entry barriers for a new
entrant as a new product is typically slow moving and has lesser consumer demand.
Therefore dealers / retailers are reluctant to allocate resources and time. Established
players use their clout to inhibit new entrant. However, when Product offers a strong
breakthrough, equity build up rapidly and, so does the Distribution network
Packaging:
The role of packaging has increased significantly in recent times, Partly due to
improvement in packaging technology. Traditionally, Packaging was expected to serve
the purpose of protection and economy. Then, packaging was expected to fulfill the
objective of convenience. Today, Packaging is used as an effective tool for promotion.
Besides, new Packaging technology has enabled most FMCG companies to significantly
reduce their packaging costs.
GLUCOSE BISCUITS CATEGORY
Glucose biscuits are high in nutrition; we know this to be a home truth. Many brands cash
in on this notion. When 12 brands of glucose biscuits were put on the test by Delhi based
Consumer voice, they were found wanting: in protein, fiber, calcium and iron. Twelve
popular brands of glucose biscuits, Anmol-G, Kellogg’s, Horlicks, Apasarji , Britannia
Tiger, Asian milk biscuit, Radha, Britannia Marie gold, Bakeman’s Glucogold, Parle-G,
Priyagold, Creamica were tested according to “IS: 1011-1992 third revision”.
In results, Horlicks and Anmol stand first and second respectively and also only
two brands to reach the “very good” category in tests. Parle-G third and Britannia tiger
comes fourth. Of 12 brands, only priyagold, Cremica Britannia Tiger carried “ISI” mark.
Glucose contents
When one buys or consumes glucose biscuits, one naturally assumes that glucose
would be an ingredient of the biscuit, but the biscuit manufacturers are under no
obligation to either put glucose in glucose biscuits or state the quantity of glucose in the
biscuits they manufacture. According to tests the glucose content in biscuits was just 1.64
percent (for Bakeman’s Gluco Gold) and 3.77 percent (for Britannia Tiger)
Proteins
Out of 12 brands, only three declare their protein content on the label, and two of
them are found to have protein content less than the claims
made.
Britannia Tiger has the most protein of the 12 brands, at 7.4percent. Horlicks and
Anmol follow close behind with 7.1percent proteins. Kellogg’s and Radha have the least
amount of proteins at 6.20 and 6.1percent.
Carbohydrates and calories
Glucose biscuits give you ready energy in the form of glucose. Horlicks provided
the maximum calorific value at 456 kcal/ 100 gm, whereas Radha did not do so well with
the lowest calorific value of all 12 brands at 420.3-kcal/100 gm.
Dietary fibre
Fiber is often missing from most processed foods, which makes over-
consumption of such foods harmful for health. The higher the dietary fiber content is
better. Apsaraji had the most dietary fiber at 6.9 percent, and Kellogg’s had the least at
4.8 percent. All brands expect for Kellogg’s fell in the ‘good’ and ‘very good’ category
as far as dietary fiber is concerned. Kellogg’s only managed to get a ‘fair’ rating.
Added sugar
All brands had added sugar between 22.7 percent (Priya Gold) and 30.8 percent
(Anmol and Radha). Labels should mention the sugar content of biscuits so that diabetic
consumers can make a decisions about which biscuit type they should eat. Existing
standards do not specify any minimum or maximum limit for sugar content in biscuits.
Calcium and iron

Glucose biscuits often claim to have the goodness of milk and extra calcium.
Biscuits, which have added milk, exhibit higher calcium content of all the brands tested,
Horlicks had the most calcium content at 5295.9 mg/kg, while the brand which had the
second highest calcium content –Kellogg's had a calcium content of 2988.5 mg/kg.
Asian had the least calcium content of all brands tested. Britannia Tiger, Horlicks
and Parle G were the only brands to declare their calcium Content on their labels. These
were found to match their actual content. Only Parle G declared its iron content, and
against its claim of 80-mg/kg Irons, it did well by providing actual iron content of 234
mg/kg.
BRITANNIA INDUSTRY
Britannia is the market leader in the organized biscuit and Bakery product market
in India. Biscuits contribute to more than 80% of Britannia’s total turnover. Other
products include bread and cakes. Britannia diversified into dairy products in 1997 with
processed cheese and dairy whitener. The portfolio was expanded with the launch of
butter, pure, flavored milk in tetra flacks and UHT milk.
The biscuits market in India is estimated to be 1.1mn tpa, valued at Rs 35bn.
The unorganized sector accounts for over 50% of the market. The market has been
growing at a CAGR of 6-7% pa. Per capita consumption of Biscuits is estimated at a low
1.5kgs, reflecting the huge potential for growth. Manufacturing was reserved for small-
scale up to 1987, which put large Players at a disadvantage. In the organized sector,
Britannia and Parle are the only national players with dominant market shares. Other
organized players include domestic players like Bakeman’s, Champion, Kwality, Priya
and M.N.C.’s li ke SmithKline Consumer, Kellogg’s, Sara Lee, Heinz, Ecclesia (Nestle)
and United Biscuits.
Competitive position:
The entry of new M.N.C.’s has not posed a direct thereat to Britannia, as these
M.N.C.’s have positioned their brands in the premium/health segment. Britannia has
maintained market leadership with a 40% volume share and 48% value market share in
the organized sector. FMCG major HLL is expected to venture into the segment.
Britannia has been aggressive in new launches and marketing during the last 2 years.
Anticipating the competition. It has also recently acquired Kwality Biscuits,

Gaining a strong foothold in the southern market. Bread is one of the most widely
consumed processed foods in the country. The market is estimated at 1.5mn tpa. The
industry is dominated by a large number of players in the unorganized sector, which
accounts for over 80% of the market. Britannia Industries and Modern Foods (now
owned by HLL) are the only two players with a national presence in packet slice bread
segment. There are several other regional players who have significant market shares in
their respective local areas. Britannia’s bread business has been slowly degrading and
registered a 9.4% volume de-growth in FY01.
Dairy:
India has emerged as the largest milk producing country in the world
Manufacturing 81 mn tons of milk pa. Britannia’s dairy business has been Growing at a
fast pace on the low base. Volume growth was 50% and value growth was 47% in FY01.
In value terms the dairy business contributed to 10% of turnover in FY01. Prior to the
entry of Britannia, the organized market for dairy products like butter and cheese was
dominated by the regional milk cooperatives, such as AMUL, Vijaya, etc. Imported
brands are also freely available in the country today. In the organized domestic segment,
AMUL remains the dominant player and will continue to be a stiff competitor, given its
sourcing advantage and market savvies. Operating margins have been improving despite
the fast pace of new product launches in the last 2-3 years. Rationalization of
manufacturing operations and greater contribution of higher margin dairy products has
both contributed to the margin gains. Britannia has decided to hive off its dairy business
into a joint venture with the New Zealand based Fonterra cooperative. Britannia and
Fonterra will each hold 49% of the Rs2.25bn equity, while the balance business
associates will hold 2%.
Background:
Britannia was incorporated in 1918 as Britannia Biscuits Co Ltd in Calcutta. In
1924, Pea Frean U K acquired a controlling stake, which later Passed on to the
Associated Biscuits International (ABI) a UK based company. During the ‘50s and’ 60s,
Britannia expanded operations to Mumbai, Delhi and Chennai. Exports of sea foods
started in the ‘70s. In 1987, Nabisco, a well-known European food company, acquired
ABI. In 1989, J M Pillai, a Singapore based NRI businessman along with the Groupe
Danone acquired Asian operations of Nabisco, thus acquiring controlling stake in
Britannia. Later, Grop Danone and Nusli Wadia took over Pillai’s holdings.
In 1977, the Government reserved the industry for small- scale sector, which
constrained Britannia’s growth. Britannia adopted strategy of Engaging contract packers
(CP) in the small-scale sector. This led to several in- efficiencies at the operating level. In
April ’97 , the Government seperated the biscuit sector from small scale. Britannia has
expanded Captive manufacturing facilities and has modernized and upgraded its facilities
in the last five years. It has also forayed into the Dairy Business with the launch of
Cheese, Butter, Ghee, Dairy whitener and flavored milk Products.
Parent Group
Britannia’s controlling stake is jointly with Groupe Danone and Nusli Wadia.
Groupe Danone is one of the leading players in the world in bakery Products business. It
acquired interest in Britannia Industries in 1989 and Acquired-controlling stake in
1993.Nusli Wadia group is one of the leading Industrial houses in the country, with
interests mainly in textiles and Petrochemicals.
Plant locations
Britannia’s plants are located in the 4 major metro cities – Kolkatta, Mumbai,
Delhi and Chennai. A large part of products are also outsourced from third party
producers. Dairy products are out sourced from three Producers – Dynamix Dairy based
in Baramati, Maharastra, Modern Dairy at Karnal in Haryana) and Thacker Dairy Product
at Howrah in West Bengal.
Business
Britannia core businesses constitute of Bakery and Dairy Products. Bakery
products account for 90% of the revenues and include Biscuits, Bread and Cake & Rusk.
Dairy products contribute to 10% of Britannia’s annual turnover of Rs13.38bn.
Biscuits (82.7%of turn over)

Revenues from biscuit were Rs 11.07bn in FY 01.The Company sold 214,214 tons of
biscuits registering a volume growth of 11% YoY. Biscuit sales in Value terms registered
a 13.2% yoy growth. Britannia has a 40% volume share and 48% value market share in
the organized biscuit market. The company presently has an installed capacity of 111,000
tons for biscuits. Production in FY01 was 59657 tons against 62034 tons in FY00. The
company outsourcers over 70% of biscuits sold.
Over the years, Britannia has introduced and developed full line of brands in all
segments of the biscuit market. The company’s Tiger ranges of glucose biscuit have been
runaway success, enabling the company to expand its presence in the largest glucose
category of the biscuit market. In salty-sweet segment Parle’s Krackjack and Britannia’s
Fifty-Fifty compete very closely.britannia’s other major brands include Marie, Thin
Arrowroot, Bourbon, Milk-bikis,Nice, Snax, Coconut Crunchies,Pure Magic, Good Day,
Jim-jam and Chekkers. It has also launched biscuits like Vita Marie Gold,Nutri-Choice
etc, under the health positioning.
Bread (4.6% of turnover)

Britannia’s bread business has been gradually growing year after Year. Bread
sales at Rs 420mn accounted for just 4.6%of turnover in FY01. Against 5.7% of turnover
in FY-2000 The Company sold 42450 tons of bread in FY01, a volume growth of 9.4%
yoy. The company has an installed capacity of 12000 tons.
Dairy products (9.8% of turnover)

The company’s diversification into dairy business has been fairly successful.
Dairy product sales were Rs 1.3bn in FY01. The company has re-launched all its dairy
products under the MilkMan brand name. New flavors like Milkman Cold Coffee and
Milkman Lassi have been launched in flavored drinks besides MilkMan Chocolate Milk
and Milkman Strawberry Milk Cheese, dairy whitener, butter and ghee are the other
products sold under the MilkMan brand. Britannia outsourcers its dairy products from
dynamics Dairy in Maharastra, Modern Dairy in Haryana and Thacker
Dairy products in West Bengal During FY01 the company sold 13039 tons of
dairy products, a 50% yoy growth over 8820 tons sold in FY00.Britannia has invested Rs
58.3mn in the equity of Dynamics Dairy in FY01.
The dairy business is proposed for divesting into Joint Venture with the New
Zealand Dairy Board’s Fonterra Cooperative. B ritannia hopes to gain from the R&D
support as well as access to the international product portfolio of the JV partner. In its bid
to re-enter the Indian dairy market, Britannia Industries, which first entered the segment
in 1997, is revamping its offering to make it more local in flavor, thus hoping it would
woo the Indian consumer.
It began by offering flavored cheese spreads – masala onion, masala Garlic, Lassi
pepper –meant to specifically cater to the Indian palate in addition to the good old plain
cheese. Also flavored cubes. Britannia claims to have a 33 per cent share in organized
cheese market. Britannia has also complete reworked its milk strategy. It has discarded
the word “flavored”. The 7,000 ton per annum category is growing with both out of h ome
usage rising. Britannia, which claims a 25 per cent market share in this segment, wants to
have the first mover advantage in this market and aims to emerge as a national brand in a
market which already has strong local brands like Milkman, Avian, Niligiris and others.
The company recently entered the ghee market in the country, with the key driver
being freshness and purity. Ghee in India is used as a cooking medium and also as a taste
and flavors enhancer. The regional dispersion of this market is Conspicuous with north
and west being the biggest. It is also highly fragmented with no national player.
One segment where Britannia has done really well is Milk Powder or dairy
whitener. The company today claims to be number one brand in this segment in volume
and tonnage with a 15 per cent share in the 32,000 ton overall market.
Cake &Rusk (2% of turnover)

Cake and Rusk sales were Rs 271mn 92% of sales) in FY01. Volume growth was
206%yoy with sales of 3082 tons. In value terms, sales grew by 12% yoy. Exports
Britannia has discontinued commodity export of Soya bean. Export of marine
products has also declined significantly. The company now mainly exports biscuits and
cheese to neighboring countries like Sri Lanka and Africa.
Earnings, sensitivity factors.

• Success if Dairy joint Venture
• Success of new product launches: New launches entail significant ad-spends and
impact margins in the short run.
• Competition activity in core biscuit business and ability to protect market share.
• Post acquisition of Modern Foods, HLL is expected to give formidable
competition in bakery products.
• Input prices: Raw material such as wheat, fats and sugar prices Influences
margins.
Critical factors which have evoked tremendous interest among both Domestic and
foreign investors.
A) The potential Indian food market is estimated to be well over Rs 1500 bn. Changing
tastes, lifestyle and cultural mores have led to a preferential shift towards processed and
ready-to-eat food.
b) The colossal waste of food can be reduced by processing Perishable products like
fruits and vegetables account for a large portion of total wastage, estimated at Rs 30 bn.
Post harvest losses of cereals and legumes are 15-20%.
c) Abundant supply of cheap raw material coming from the large annual agricultural
produce. India is the world’s second largest producer of fruits, vegetables and milk.
Cereal and oilseed production is significant. A large cattle population (second largest
producer of buffaloes) and a long coastline have ensured abundant supplies of meat,
poultry and fish.
d) The industry is relatively less capital intensive and has large employment potential,
which suits India’s resource endowment, The present state of low productivity can be
raised with modest investment resulting in large increase in output, This also serves
developmental objectives of policy makers.
e) Good export prospects. Cost of several agricultural products are internationally
comparable and the cut in food subsidies in developed countries-USA, Japan and EU will
further enhance competitiveness.
COMPANY HISTORY
1918
- The Company was incorporated on 21st March, as a public limited company under
the Indian Companies Act, VII of 1913. The company manufactured bakery and
soybean products. Export of cashew kernels marine products and general
merchandise started during this year.
1921
- The company obtained a priority of certificate and imported new machinery
thereby becoming the first biscuit company in India to install and run a gas oven
plant.
1924
- A new factory was established at Kasara pier Road in Mumbai. In the same year,
the company become a subsidiary of peek, Frean & Co. Ltd., a leading biscuit
manufacturing company, and further strengthened its position by expanding the
factories at Calcutta and Mumbai.
1939-45
- A large part of the company’s production was diverted to war effort on account of
world war II and at times as much as 95% of the total capacity was booked for the
production of ‘Service Biscuit’.
1951
- 19,779 Equity shares issued to acquire the Delhi Biscuit Co. Ltd .In August
1,53,234 Bonus equity shares issued in the proportion 1:1
1952
- The Calcutta Factory was shifted from Dum Dum to spacious grounds at
Taratola Road in the suburbs of Calcutta. During the same year automatic plants
were installed there and later in Mumbai in 1954.
1954
-The development of high quality sliced and wrapped bread in India was
pioneered by the Company and was first manufactured at Delhi. -1,53,234 Bonus
equity shares issued in the proportion 1:2.
1961
- Manufacture of bread was started in Mumbai and a new bread bakery was set up
at Delhi in 1965. -2, 29,851 Bonus equity shares issued in the proportion 1:2.
1966
-In May 1966, 3, 06,468 Bonus equity shares issued in the proportion 4:9.
1968
- On 14th May, 6,64,014 Bonus equity shares issued in the proportion 2:3.
1970
-9,96,021 Bonus equity shares issued in the proportion 3:5.
1976
-Britannia bread was introduced in Culcatta and Chennai.
-18,59,239 Bonus equity shares issued in the proportion 7:10 in April.
1978
-After the issue of shares to the Indian public, the non-resident holding in the
Company was reduced to less than 40%. 18,00,000 Equity shares issued at a
premium of Rs 5 per share. 4,06,286 shares offered as rights to resident Indian
shareholdes in proportion 1:5. 43,714 shares offered to the Company’s
employees; 1,00,000 shares to UTI and 50,000 shares each to LIC and GIC were
reserved for allotment and 11,50,000shares offered to the public during
January/February.
1979
- With effect from 3rd October, the name of the Company was changed from the
Britannia Biscuit Co., Ltd., to Britannia Industries Ltd.
1980
The company signed a 10-year technical collaboration agreement with Nebico
Pvt. Ltd., Nepal, for the supply of know-how relating to manufacturing, packaging and
marketing of biscuits and selection of plant and machinery.
1982
-25,26,118 Bonus equity shares issued in proportion 2:5.
1986
-The turnover increased by 19.4% over the previous year to Rs 192.15 crores.
Sales of biscuits, in terms of volume, registered a satisfactory growth. ‘Good Day’, a new
biscuit launched during the year met with good market response.
Production of bread at Delhi unit was adversely affected due to launched pure
refined cooking oil under the brand name of ‘Vital’. -35,36,565 Bonous shares issued in
the proportion 2:5 during July 1987.
1987
In (16 months), the total sales turnover increased on an annualized basis by 38.7%
over the previous year. Increase in sales of bakery and Soya products divisions and
higher cashew exports helped to realize higher sales. With the introduction of some more
brands during the Year, the total biscuit brands of the bakery division reached 27. The
Soya products division introduced range of extruded products under the brand name
‘VITAL FEAST’ .
1989
- The Company launched new brand of biscuit, namely, ‘CIRCUIT’. Another
Brand ‘PURE MAGIC’ was extended nationally pista badam was added To
‘GOOD DAY’ range of biscuit. Bread production and affected for some time at
Delhi factor due to industrial unrest.
- -61,88,989 Bonus shares issued in proportion 1:2.
1990
Two new brands of biscuit, ‘Elaichi Cream’ and ‘Petit Beurre’were launched.
Also, new cashew badam variants of the brand ‘Milk Bikis’ and brand extension of pure
magic biscuit Vanila cream were launched. Fruit bread was launched in Delhi and was
well received.
1991
The company launched two new specialty brands viz ., Britannia milk bread and
Britannia brown bread in Delhi and extended nationally its main brands Petit Beurre and
elaichi cream.
-On 17th August, the company handed over to S M Dychem Ltd, its soya
Unit at Vidisha,MP.
The company proposed to invest in the equity capital of Britco Company Pvt
Ltd., a joint venture with JMRPCO Ltd., Hongkong, for manufacture of beverage bases
and essence for Coca Cola, Fanta & Sprite and to export processed snack foods.
1992
-The company launched a new brand of biscuit, namely ‘Little Hearts’ that carved
a niche in the market.
1993
-The company launched the new brand of biscuit, namely, ‘Fifty-Fifty’. Bread
market remained depressed. To revive the market, the company launched a specialty
brand viz . ‘Premium Bake’ in both Delhi and Mumbai. During the Year, the comp any
has started exporting Basmati Rice under the name ‘Britannia Indian Pearl’.
1994
- During the year, the bakery division launched ‘Bakers Choice’a sweet
Biscuit and ‘Thinlight’ a light semi - sweet biscuit aimed at fitness conscious
Consumers.
1995
-Under the ‘Pure Magic’ s’ Umbrella, the company launched a new san ds witch
cream biscuit with two-in-one flavors viz. double cream and this was well received in the
market. In the cake market, under the premium segment, the company launched with
Group Danone’s technological input a swiss roll Cake ‘Mini Roule’ which als o met with
good response.
1996
-Mariegold biscuits registered quantum growth in volumes and milk bikis Milk
cream launched during the year was well received. Despite general
Slow down in the economy the company’s profits improved.
1997
-The biscuit industry has been deserved which would not only remove restriction
on increasing capacity but would also provide opportunities of growth through new
products and efficient production systems. The company undertook to diversify into
cheese and dairy whitener. -The company launched ‘Tiger’ range of biscuits for mass –
market category, ‘Jim-Jam’ and ‘Chekkers’ in the premium segment. The Company also
launched Butter in Delhi during the year.
-Britannia Industry (BIL) is one of the largest bakery in the private sector and a
household name in food products.
-Britannia Industries Ltd (BIL) will shortly enter the cheese and milk products
market with an alliance proposed between itself and the Mumbai-based Dynamics Dairy
Ltd.
-Britannia Industries Ltd is all set to launch a new corporate identity and a total
revamp of its product portfolio, with strategic inputs from an international strategic
design and brand repositioning company – Shining strategic Design.
1998
-Food major Britannia Industry Ltd (BIL) signed a wage agreement with the
Maharashtra General Kamgar Union (MGKU), providing an average wage increase for
1,000 workers employed in the biscuit manufacturing unit at Reay Road, Mumbai.
-The company launched Half/Half, a soft cake filled with cream in two variants,
chocolate-vanilla and vanilla-orange. Half/Half comes in twin cake pack (Rs.6) and tray
pack containing five cakes.
-Britannia Industries Ltd has launched a festival offer for Britannia

Dairy Whitener in Kerala.
- An Ind ‘AAA’ rati ng was given to the Rs.100-crore secured non- convertible
debenture issued from Britannia Industries Ltd (BIL).
1999
-Britannia Industries Ltd rolled out its flavored milk brand “Zip -Sip’ in tetra
packs. Zip-Sip has been launched in Mumbai and some markets in the South – Britannia
Industries launching the country’s first branded flavored milk is another step towards its
goal of becoming a dairy – products giant.
-In a move meant to sharply increase its India – profile. ‘Knowledge major’
Encyclopedia Britannia Inc plans to come out – for the first time – with
India and south Asia-specific volumes targeted at school children as well as
Institutions and the general ‘knowledge –seeker’ .
2000
-Britannia Industries launched consumer promotion scheme ‘Britannia Khao,
Cricketer Ban Jao’ on May 1 st.
-Britannia Industries, in its second coming in the Indian dairy market under the
‘Milkman’ brand, introduced a range of products many in desi flavors to woo the Indian
consumer.
-The company launched vita mariegold, a semi-sweet biscuit that

Reportedly had 10 essential vitamins, milk protein and 58 cereals.
-Britannia’s Milk Bikis Funland biscuits and innovative extension in the

Milk Bikis brand.
-The industry is set to start brand- manufacturing factories in Kochi, Hyderabad

and Chennai to tap the region’s market potential.
- The company became the first company to take it products to the net in the
form of a video file.
- A Britannia industry launched Britannia Milkman Butter, a product under the

Milkman brand.
- The company appointed Tata Energy Research Institute (Teri) for a

Power audit.
- FITCH rating India Pvt. Ltd reaffirmed the Ind AAA rating assigned to the Rs
1000 million non- convertible debenture program of Britannia Industries Ltd.
-The Company launched two new dairy products Milkman Cold Coffee and
Milkman Sweet lassi.
- Britannia Industries Ltd. introduced a new range of traditional

namkeens called Britannia Snaz in Mumbai.
2001
- Britannia Industries launched Britannia Milkman Milk in Delhi.
-Biscuits major Britannia Industries will fund its in- principle agreement to
acquire 49per cent of Kwality Biscuits through internal accruals.
2002
-Britannia Industries Ltd announced on March 26, 2002 that it has entered into a
joint venture with the Fonterra Cooperative Group, New Zealand’s biggest company and
one of the leading dairy co–operative group in the world.
-Britannia’s new COO is Nikhil Sen .
2003
-Board of Directors of Britannia Industries Ltd has passed a resolution to
terminate the employment of Mr. S.K.Alagh as Managing Director of the company with
immediate effect.
-The management of Britannia Industries dropped John Miller, a Danone

representative, as additional director on its board.
-Britannia New Zealand Foods, a joint venture of Britannia Industries and
fonterra Co-operative group of New Zealand launched ‘Britannia MilkMan’ fresh milk.
-Britannia’s Non -convertible Debenture was rated AAA by Fitch Rating India as
‘Stable Outlook’.
-Britannia Industries appointed Mr. Nikhil Sen, Chief Operating Officer as the
manager of the company.
2004
-Britannia Industries Ltd informed that pursuant to the approval of the
shareholder of the Company at the AGM held on August 08,2003 and the subsequent
application to the Cochin Stock Exchange Ltd., the said stock exchange delisted the
securities of the Company with effect from November 15,2003.
Recent Development
The company board proposed to buyback up to 25 lakh equity shares of Rs 10
each at price not exceeding Rs 650 per share from the open market. The out flow for the
company would not exceed Rs 92 crore. The buyback would be carried out of the
necessary permissions.
The company entered into a joint venture with New Zealand’s Fonterra
Cooperative Group, a leading dairy co-operative in the world, wherein it transferred its
existing dairy business. The joint venture, called Britannia New Zealand Foods Pvt Ltd
and effective March 27, 2002, is engaged in areas relating to sourcing/manufacturing and
distributing of milk and milk products in India. Britannia and Fonterra will each hold
49per cent stake in venture while a strategic business partner will hold the remaining
2percent. Britannia will offer a robust base In the form of its existing dairy business while
the Fonterra Group will provide its advanced technical know – how and learning from
international Market.
The company has dropped its proposed foray into mineral water Business. The
move comes close on heels of its parent, Danone launching its own mineral water brand,
Evian, in India through separate wholly owned subsidiary, Danone India.
The company, which has agreed in-principle to acquire a 49per cent stake in
kwality Biscuits and Snacko Biscuits, has the option of hiking the holding in the two
companies to 100per cent.
The company is expected to complete the acquisition of the 49 per cent stake in
Kwality Biscuit and Snacko Biscuits soon. In October2001, Britannia had agreed in-
principle to acquire a 49% stake in Snacko Biscuits, a privately held company, along with
trademark ‘Nutrine’ and several other trademarks in addition to their copyrights and
designs.
The brand is expected to co-exist with Britannia’s Good -Day biscuit, which is
also a premium brand. The company has also chalked out plans for its Mass-market
biscuit brand Tiger, the largest selling brand in biscuits. The company will be introducing
variants of the mother brand in the next three months.
According to former Britannia Industries managing director & CEO Mr Sunil

Alagh: “The Company has received a favorable response for its New launches Britannia
Milkman Cold Coffee Sweet Lassi across the Country”.
Speaking to The Financial Express, Mr Alagh said the volume of its biscuit brand
50:50 have jumped by 20 per cent after the company decided to sponsor Kaun Banega
Crorepati in which 50:50 has entered into a co-branding initiative. Says Mr Alagh: “after
our company started beaming the 50:50 TV sports in September, the volumes have gone
up by 20 per cent. Now we can not produce enough to cope with customer demand.”
In a bid to promote its entire product range, Britannia launched Kaun Banega
Crorepati offer from October 3,2000. to January 2001. Under the offer, 2,400 lucky
winner will get the opportunity to participate in the quiz show.
Explains Mr Alagh: “There are only two routes to participate in the quiz show
now. Either you call up Star plus channel or take part in our- Britannia Khao, Kaun
Banega Crorepati Mein Jao.” To gain visibility for its new dairy products, the company
has already begun airing a high voltage television campaign last week.
Britannia Industries leads in the Rs 2,000-crore branded biscuits Market with a

share of about 38 per cent, followed closely by Parle Foods. Biscuits are the revenue
drivers for Britannia Industries, contributing about 70 per cent to the company’s turnover.
Other biscuit products include Nice, Cream Treat, Snax, Marie Gold, Pure Magic
and Little Hearts.
Future Plans
The Rs 1,200-crore Britannia Industries Ltd. is planning to launch a new Biscuit
brand in the premium segment in the next two weeks the biscuit major is, however,
reluctant to reveal details about its new launches.
The company plans to launch slew of products under its Tiger brand. It Aims to
become No.1 brand in glucose biscuits market in next 3 years. Over taking Parle
products, currently leader in mass market for biscuits. The company plans to introduce
brown bread in the Indian market and is looking for franchisees in the metropolitan cities.
INTRODUCTION TO CHANNELS OF
DISTRIBUTION
The American Marketing Association defines distribution channel as structure of

intra company organization units and extra –company organization units and dealers,
wholesalers retailers through which a commodity, product or service is marketed.
It can be further stated as “a pathway composed of Intermediaries, also called

middleman, who performs such functions as needed to ensure smooth flow of goods and
services from the manufacturing ends to the consuming ends in order achieve marketing
objective of a company”.
CHANNEL FUNCTION AND FLOWS

A marketing channel performs the work of moving goods from producers to
consumers. It over comes the times, and possession gaps that separate goods and services
from those who perform a number of ways of functions.
a) Information:
The collection and dissemination of current customers, competitors and other
factors and forces in the environment.
b) Promotion:
The development and dissemination of persuasive communication designed to
attract customers to the offers.
c) Negotiation:
The attempt to reach final agreement on the prices and other terms so that transfer
of ownership or possession can be affected.
d) Financing:
The acquisition and collection allocation of funds required financing inventories
at different levels of the marketing channel.
e) Ordering:
Marketing channel member’s communication to buy from the manufacture.
f) Risk taking:
The assumption of risks connected with carrying out the channel work.
f) Physical possession:
The successive storage and movement physical product from raw materials to the
final customers.
A distribution system is a key external resource. Normally it use years to build

and it is not easily changed. It ranks in importance with key internal resources such as
manufacturing research engineering and field sales personnel and facilities. It represents
as well as commitments to set of policies and practices that constitute the basic fabrics on
which an extensive set of long term relationship is worn.
Most producers do sell their products directly to the final users. Between
producers and final users stands a marketing channel, host of marketing intermediary
performing a variety of function and bearing a variety of name. Some intermediary such
as wholesalers and retailers search for customers and may negotiate on the producers
behalf but do not take title to the goods, they are called agents. Still others such as
transportation companies, independent warehouse, banks and advertising agencies assist
in the distribution process but neither take title to the good nor negotiate purchase or
sales, they are called facilitators.
The company’s chosen channel intimately affects all the other marketing
decisions depend upon how much training and motivation the dealers needs. In addition
the company’s channel decision involves relatively long term commitment to other firms.
INTERMEDIARIES USED IN A DISTRIBUTION CHANNEL
Intermediaries are used in smooth flow of goods and services. This producer is
necessary in order to bridge the discrepancy between the assortments demanded by the
consumers.
Various intermediaries used in marketing channel.
a) Broker:
An intermediary whose job is to bring together buyers and sellers and who does
not carry inventory, get involved in financing or assume risk.
b) Facilitators;
Intermediaries who assist in the distribution process but neither take to goods nor
negotiate purchase or sales.
c) Manufactures representative
A company represents and sells goods of several manufactures, hired by
companies instead or in addition to an internal sales force.
d) Merchant:
An intermediary who buys or takes title to resells merchandise.
d) Retailers:
A business enterprise that sells goods or services directly to the final consumers
for his or her personal, non-business. use.
f) Sales agent :
An intermediary who searches for customer and negotiation on a producer’s
behalf but not take title to the goods.
g) Wholesalers:
A business enterprise that sells goods or services to those who buys for sale and
business use.
FUNCTIONS OF WHOLESALERS AND RETAILERS
Among the various intermediaries wholesalers and retailers play a significant role
in a distribution channel. Wholesalers and retailers are two important intermediaries for
the primary and secondary sales, which is adopted by a company. They are those
intermediaries who take both title and possession of goods from the preceding members
and channel them to the subsequent members in the channel sequence.
Wholesalers
Merchant wholesalers may be defined as that intermediary who buys goods in
bulk from manufacturers and sells them subsequent intermediaries participating in the
channel, namely Semi-wholesalers and Retailers and sometimes to large consumers in
relatively smaller lot. Wholesalers may be further divided as follows
a) Full function wholesalers:

A full function wholesalers is that intermediary who buys and sells products in his
own accounts, carriers stock, organize many source in bulk, sell assembles
products in smaller lots and renders counsel and advice to his buyers. He renders a
numbers of service to manufactures.
b) Semi-wholesalers:
A semi wholesaler is that merchant who buys products largely from wholesalers
and at times from manufactures in lots smaller relative to wholesalers and sells in
assorted packs to retailers and consumers after assembling various lines of
products of different manufacture as their requirements.
c) Retailers:
Retailers may be defined as that merchant intermediary who buys Products

from preceding channel members in small-asserted lots to suit individual
consumers requirements. Retailer is final component in the distribution channel
that links with consumers. His contacts with the consumers are constant and
living. The retailer may be further divided into two kinds as institutional and non-
institutional retailers.
A brief description of the institutional retailers is given below.
1) Consumers Co operative Stores: These are retail stores owned by

consumers. They buy goods from wholesalers in the cooperative and private
sectors and sell to consumers usually in the area carried by them.
2) Air price Shops: This retail out lets established by the manufactures and states
for selling products prices which are fair.
3) Departmental Stores: A departmental store is a big retail with many

departments under one roof. It offers a wide range of products so as to suit
different consumers tastes and preferences.
4) Chain stores: Chain stores or multiple shops are a network of retail shops
owned and operated by a manufactures or an intermediary. The shops have
identical merchandising strategies with identical products and display.
DISTRIBUTORS AND DEALERS
Distributors and dealers are the two words often used while discussing
distribution channel in marketing. Although these are used interchangeably and their
meaning has been standardized, these two are merchant intermediary who deal in
products line of a manufacture under exclusive Franchise agreements which usually
incorporate restriction regarding territories and markets served and products handled lay
condition in respect of resale rice, inventory carrying and payments etc…
AGENT INTERMEDAIRIES
Agents who are those channel components that over take title to and usually do not
take possession of goods but merely assist manufactures, merchant intermediary and
consumers in carryings out transactions of sale sell goods on their own account but
merely bring buyer and sellers together in orders to scroll and transaction.
Agent intermediary may be further classified has follows:

a) Sole selling Agent : Sole selling agent are those intermediaries who are given
exclusive franchise to channels the whole or substantially the whole of
manufacturer production without any territorial restrictions on the basis of terms
and condition until agenda upon and contained in the agency agreement
stipulated. In India intermediaries are very popular both with big and small
companies.
b) Selling agents: Selling agents are those agent intermediaries who are given
exclusive franchise only for limited market segment. Thus these differ from sole
selling agents in terms of restriction imposed with respect to
territory operations handled or consumers served.
c) Commission agents: these are wholesale drop shippers who, in India also
combine functions of an agent. These agents do not buy goods and sell goods in
their account but work as manufacture’s extension. They book orders from buyers
and send indents to manufacture for configuration and dispatch of goods buyers at
the places and time indicated there in.
d) Brokers: Brokers are those agents intermediaries who do not by themselves buy
or sell products but act only as contract persons for prospective sellers and buyers
participating in the distribution channel. They take absolutely no risk and get
compensated by the way of brokerage only whenever transaction is
stipulated.
CHANNEL LEVELS
CONSUMERS MARKETING CHANNELS
A zero level channel (also called a direct marketing channel) consists of a

manufacturer selling directly to the final consumer. The major zero level and channel are
door to door sales, home parties, mail orders, tele marketing TV selling and manufactured
owned stores. Longer marketing channel are also found in Japan, for example food
distribution may involve as many as six levels. From producer’s point of view, the
problem of control information about the end user and exercising control increases with
number with the numbers of channel levels.
CHANNEL DESIGN DECISION
In designing marketing channels, manufactures have to decide what is ideal, what is

feasible and what is selling in limited market since it has limited capital, it usually uses
existing intermediaries, the numbers of intermediaries in any local is opt to be limited. A
few manufacturer’s sales agent, a few wholesalers, several established retailers, few
trucking companies and few warehouse. The problem might be to convince one or few
available intermediaries to handle the manufacturers to handle one or few available
intermediaries to handle the manufacturer’s line.
If new firm is successful, it might branch out to new markets again the
manufacturer will tend to work through the available intermediaries, although doing so
might mean using different types of marketing channels is In different areas. In the larger
markets the firm might sell directly to retailers in the larger markets, it might sell through
distributors. In rural area, it might work with general good merchants, in urban areas with
limited. Line merchants. In one part of the country, it might grant exclusive franchise
because the merchants normally work this way. In other, it might sell through all out let’s
willing to handle the merchandise.
ANALYSING CUSTOMER’S DESIRED OUT PUT LEVELS

Under what, where, why, when, and how target customers buy is the first step in
designing the marketing channel. The marketer must understand the service output levels
desired by the target customers, the types and levels of services levels that people want
and expect when they purchase a product. Channel produce five service outputs, they are
as follows:
Lot size: The size is the number of units that the marketing channels permit typical
customers to purchase on a purchase occasion. The smaller the lot size, the greater the
service output level that the channel must provide.
Waiting time: Waiting time is the verge time that customers of that channel wait for
receipt of the goods. Customers normally prefer fast delivery channels.
Special convenience: Spatial convenience expresses the degree to which the

marketing channel makes it easy for customers to purchase the product augmented by the
use of direct marketing. Service backup represent the work adds on services (credit
delivery and repairs) provided greater the work provided by the channel.
The marketing channel designer must know the service output desired by the
target customers. Providing increased levels of service output means increased costs for
the channel and higher prices for customers. The success of discount stores indicate that
many customers are willing to accept lower service output when this translates into lower
prices.
ESTABLISHING THE CHANNEL OBJECTIVES AND

CONSTRIANTS
The channel objective should be in terms of targeted service output levels.

According to Buckling – under competitive condition channel institution should arrange
their functional tasks so as to minimize the total channel costs with respect to desired
levels of service output. Usually service zarket segments can be identical that desire
differing service output levels, effective channel planning requires determining which
market segment to serve and the best channel to use in each case.
Channel objectives vary with product characteristics. Perishable Product requires

more direct marketing because of the dangers associated With delays and repeated
landing. Bulky products, such as building Materials, require channel that minimize the
shipping distance and the Number of handling in the movement from producers to
consumers. Non –standardized products such as, custom build machinery and specialized
business forms are sold directly by the company sales representative. Products requiring
installation and for maintenance service such as heating and cooling system are usually
sold and maintained by the company or exclusively franchised dealers. High unit value
products such as generators and turbines are often sold through a company sales force
rather than through intermediaries. Channel design must take into account the strength
and weakness of different types of intermediary. For example, manufacture’s
representatives are able to contact customers at a low cost per customer because the total
cost have shared by service clients. Channel design must also adapt to the larger
environment. When economic conditions are depressed, producers want to move their
goods to market using shorter channels and without nonessential service add to the final
price of the goods. Legal regulation and restriction also affect channel design.
PRIMARY AND SECONDARY SALES METHOD ADOPTED BY

BRITANNIA
The primary sales are affected to the Registered stockiest from the branch and the
distributors take the redistribution i.e. secondary sales. Considering the fact that survival
of any brand depends on the retailers and company’s efforts to grab the required self -
space. It is imperative that retailing with attractive benefit and organized courage is the
only answer to effective redistribution. the primary sales are affected to the distributors
by charging as net billing price on which benefit such as dealers scheme, retailers
scheme, additional discount etc. are given enable the distributors to offer attractive
incentives to the retailers
Thus the strategy ensures that the functional involved in effective retailing are
co-oriented and control systematically and also combat to ensure the required growth,
apart from marinating the brand.
TERMS AND RESPONSIBILITIES OF CHANNEL MEMBERS
Relationship marketing is an important part of managing the marketing channel.

The producers must determine the rights and responsibilities of the participating channel
members making sure that each channel member is treated respectfully and given that
each channel member Element in the “relation mix” are price policies, conditions of
sales, territories rights and specific rights services to be performed by each party.
Condition of sales refers to payment terms and producers guarantees, most

producers grant cash discount to their distributions for early payment and producers
might also guarantee distributors against defective merchandise or price decline. A
guarantee against price declines give distributors an incentives to buy larger quantities.
distributors territorial right are another elements I the trade relation mix. distributors want
to know where and under what terms the producers will franchise other distributor. They
would also live full for all sales
taking place in their territory whether or not they did selling.
Mutual service and responsibilities must be carefully spelled out, especially in franchise
and exclusive agency channel. In all franchise are expected to satisfy company standards
regarding physical facilities, cooperative with new promotional programs, furnish
requested information and buy specified food products.
MOTIVATING CHANNEL MEMBERS
Intermediaries must be continuously motivated to their best job. the terms that lead them
to join the channel provide some motivation, but these must be supplemented by training,
supervision and encouragement. the producers must not sell through the intermediaries
but also to them dealers incentives program can serve a powerful motivator. When
micro-brewing company launched its business, it offered attractive incentive to large and
small distributors who has signed on to sell its products.
Stimulating channel members to top performance must start with understanding of

their needs and wants. Some properties are listed to help understand intermediaries.
The intermediaries often act as a purchase agent for his customers and only
secondary as a selling agent for his suppliers . he is interested in selling only product,
which these customers desire to buy only from him. The intermediary attempts to hold
his entire offering into a family of items, which he can sell combination. His selling
efforts are directed primarily at obtained orders for the assortments, rather than for
individual items.
Unless given incentive to do so, will not maintain separate sales records by brand sold
information that could be used in product development, pricing, packing or promotion
planning is buried I nonstandard record of intermediaries and some times purposely
secreted from suppliers. Producers vary greatly in how they manage their distributors.
They can draw on following types of power of illicit cooperation.
• Coercive power : a manufacturer wields it that they’re to draw resources or to

terminate a relationship of intermediaries fail to cooperate. This power is quite
effective if the intermediaries are highly dependent upon manufacturer. But he
exercise of coercive power producer resentment and can lead the intermediaries to
organize countervailing power
• Reward power : It occurs when the manufacture offers intermediaries an extra

benefit for performing specific acts or function. Reward typically produces
better result than coercive power but can over rated. The intermediaries are
confirming to the manufacturer wishes not out of conviction but because of
external benefit.
• Legitimate power : It is wished when the manufacturer request a behavior that

the contract. Thus general motors may insists that its dealers carry certain
inventory levels as part of the franchise agreement. The manufacturer feels it has
this right and intermediaries have this obligation. As long as the intermediaries
view the manufacturer as legitimate, legitimate power works.
• Expert power: It can when the manufacturer has special Knowledge about the
intermediaries’ value. For system fo r sales leads generation or for distributors
sales training. This is an effective form of power of intermediaries would perform
poorly without this help. once the expertise is passed on to the intermediaries,
however this basis power weakness. The manufacturer must continue to develop
new exercise so that the intermediaries will ant to continue cooperating.
• Referent power: It occurs when the manufacturer is so highly respected that

intermediaries are proved to be identified with it. for example MC DONALDS
and Hewlett and Packard have referent Power. The extent possible, manufacturer
will gain best cooperation if They resort to referent power, exert power, legitimate
power and reward power in that order and generally avoid using coercive Power.
Long sophisticated companies try to forge a long-term Partnership with their

distributors in the way of market coverage, inventory levels, marketing
development, accounts solicitation, technical Advice and service and marketing
information. The manufacturer seeks distributions agreements with these policies
and may introduce a Functional compensation plan for adhering to the policies.
TERMS AND CONDITIONS FOR APPOINTMENT OF

DEALERS/DISTRIBUTORS
When in territory scope is there needs essential activities of a dealer. These

dealers appointment will be done & that was renewed .the discount on the net
billing and incentives will be indicated during the appointment. Delivery of goods
wills on fright. The terms of payment will be Cheques. Dealer’s deposit will be
taken, and amount is taken Rs 5,00000 as a security deposit. The dealer’s
commission depends upon
Sales.
Some points considered during the appointment of dealer are :

¾Scope of activities in a specified territory.
¾Period of appointment restricted to concerned to financial year and
renewable there after considering the merits.
¾Discount on net billing prices and the incentives would be
Indicated for time to time and is visible.
¾Delivery of material will be on “ freight paid basis” up to
transporters go down.
¾Statutory levies would be charged at the prevailing rates.
¾Terms of payment generally only against advance payment by the
Way of Cheques, however depending upon merits of the case it
would be through bank with a limited credit period.
¾Dealership deposits is Rs 5,00,000.
Dealers meeting will be held every half-year or once in a year in order to discuss the
problems faced by them. Discussion will be at convenient Places along with respective
representative.
SUGGGESTIONS ON DISTRIBTION CHANNELS OF BRITANNIA
To provide more credit period for the Retailers, as this was the main demand.
Since the company is in the thick of competition it has to ensure that it dealers
staff, distributors, service agents and other administrative staff are true
professional in their respective fields so that the company does not detach
itself from professionalism and technically sound skill. Therefore the
company has to be choosy in appointing dealers with high caliber and good
amount of expertise in the relevant field.
Some dealers of the company are carrying multi brand products. It puts lots of
pressure in company’s own product, which is facing stiff
competition from its rivals. Companies can adopt better monetary policy
towards dealers /sub dealers and it will boost company’s channel.
Company can display contests at retail outlets, offering and prizes also other
attractive incentives.
Dealers meeting can be arranged where problems of dealers (either

with product or the company) should be discussed. Those problems have been
to address immediately, for which necessary corrective steps have to be taken.
Sales quotas have to be fixed for these dealers and sub dealers so that the
performance of each dealer can be rewarded so as to get best out
him. Then the most important is to motivating to dealers so as increase their
morale through incentives, discounts, bonus etc…
CONCLUSION ON DISTRIBUTION CHANNELS OF BRITANNIA
From the research findings it can be concluded that for the success and survival of
any brand. Any company should have to adopt a right distribution process for their
products and also to deploy right kind of intermediaries. The four policies to appoint
dealers /distributors, their remuneration method, terms of payment, etc., all these points
are the important factors discussed in the study.
My study in Britannia industries limited has been extensive and detailed. No just
the intention of project or preparing report but with an objective of finding practical
knowledge about the distribution process of the company.
FINDINGS ON RETAILERS SATISFACTION
(FOR COMPANY)
Parle is the tough competitor for the Britannia and preceded by Kwality biscuits.
There are company biscuits company brands like Horliks, Dukes, complain which
are entered into the market.
After the withdrawal of 25% free offer from the Britannia Tiger glucose
biscuit, there was a decline in the sales of tiger glucose biscuit in the busy places
like bus stand, railway station, old Hubli area etc., 43% of the respondents are
dealing Britannia biscuits,47% of the respondents are dealing with Parle biscuits.
50% of the respondents are of the opinion that Britannia products sell most, 48%
of the people says that Parle products sells most.
32% of the respondents voted that Parle –g sells most as glucose brand where as
32% respondents Said it was Britannia tiger that sells most.
73% respondents are of the opinion that the consumers prefer Britannia premium
varieties.
44% of the respondents agree that Parle is in highest in sales in terms of value.
38% of the respondents are selling the Britannia products since 5-10 years, 22%
of the respondents are selling the Britannia products since 1-5 years.
Respondents are mainly ranked credit facility, margin, brand image, of the
company and advertisement as main factors that help in pushing up of the biscuit.
10% respondents ask for more profit margins, 35% are interested in credit facility
and 30% are in need of discount as market support that needed by company.
30% retailers are very much satisfied with service given by the Annapurna traders
and 64% of retailers are satisfied with service.
66% of the retailers do not take any promotional activity where as only 34%
retailers go for advertisement. Most of the retailers use suggestion as their
promotional tool for advertisement.
SUGGESTIONS ON RETAILERS SATISFACTION
(FOR COMPANY)
¾ Give some extra benefit like Tattoo or Picture cards with every pack of biscuit
that was sold. As it will attract children and influence them to purchase the biscuit
the company.
¾ Make available the products in retail outlet as and when they are launched. Most
of the flavors/ products, which are shown on television commercial, are not
available at retail out let whenever consumer asked for them.
¾ If possible increase the margin given to intermediaries for boosting the sales of
the biscuit.
¾ Retailers want offers. They are more interested in offers such as trip to other
country, cash discounts on the bill, gold schemes etc., they are more delighted by
the cash discounts on the bill. Many of the customers are not aware of the offers
given by company or they are not getting these benefits.
¾ Provide some monetary support to retailers to advertise in local cable T.V.and

newspapers.
¾ Company can find effective communication network between manufacturer &

intermediaries through meeting & setting the joint goals like leadership in market
share, customer’s satisfaction and total quality management.
¾ Company can develop the marketing system such that manufacture, dealers
and representative acts in a unified manner to have the better control on the
channel member & eliminate the channel conflicts.
¾ Trained representative can increase the product knowledge & market
coverage of the brand.
¾ Company can increase the morale of retailers by giving them special offers,
discounts & credit facility.
FINDINGS ON RETAILERS SATISFACTION
(FOR DISTRIBUTORS)
¾ Service given by the Annapurna Traders is satisfactory among the retailers.
¾ Retailers are satisfied with service like on time delivery, immediate replacement
of the damaged goods and the way the queries handled by distributors.
¾ Very few retailers are dissatisfied with service.
¾ Retailers wish to have more credit period or give them goods on credit.
¾ Most of the retailers dealing with Britannia biscuits are between 5-10 years.
¾ In some retail out let a representative from the distributors visit them to take up
orders.
SUGGESTION ON RETAILERS SATISFACTION
(FOR DISTRIBUTORS)
¾Tap the retailers who have just started the business.
¾Increase the supply of goods once in a week to twice in a week, as it is one of the
demands of the retailers, which will help them to serve the consumer in a better way.
¾Provide credit facility to retailers.
¾Contact the retailers who are dissatisfied with service.

OBJECTIVES OF RESEARCH.
sampling plan.

industries limited.
METHOGOLOGY
INTRODUCTION
Marketing Research is the systematic designing, collection, analysis, and reporting of

data and findings relevant to a specific marketing situation faced by the company.
The basic plan, which guides the data collection analysis and phases of the project. It is a
framework which specifies the type of information to be collected, the sources of data,
and the data collection procedure.
TYPES OF RESEARCH:
Marketing Research studies can be broadly classified in three basic types namely,
• Exploratory Research.
• Descriptive Research.
• Casual Research.
Exploratory Research:
The major emphasis of exploratory Research is on the discovery of ideas. Marketing

Research devote a significant portion of their work on exploratory studies when very
little is known about the problem being examined. The idea is to clarify concepts and
subsequently, make more extensive research on them. Its goal is to shed light on real
nature of the problem and suggest possible solutions (or) new ideas.
Descriptive Research:
Descriptive Research attempt to determine the frequency with which something occurs
(or) the relationship between two phenomena. Usually descriptive studies assume certain
underlying characteristics of the markets (or) have precise statement of research question.
Casual Research:
Casual Research attempts to make casual inferences about the market behavior. The idea
is to assess the impact of a change in one parameter which would have a resultant effect
on others i.e. its purpose is to test the cause and effect relationship technically this is
known as ‘experimentation’.
For the present study, the researcher has based his theme on Exploratory Research.
SAMPLING TECHNIQUES:
In this research Non-probability convenience sampling has been used.
A probability sample is one in which the sampling units are selected by chance and for
which is a known chance of each unit being selected.
A non-probability sample is one in which chance selection procedures are not used.
Several kinds of non-probability are in common use. They include convenience,
judgments, quota and purposive samples.
A convenience sample is one selected purposively in such a way that the demographic
characteristics of interest are represented in the sample in the same proportion as they are
in population.
SAMPLE SIZE:
This refers to the number of items to be selected from the universe to constitute a sample.
The representative of a population selected at random is called the samples. Of course,
large sample give more reliable results than small samples. However, it is not necessary
to get the opinion of the entire population (or) even substantial portions to achieve
realize results. For this particular study sample size of 100 customers was taken.
SAMPLE DESCRIPITION:
Sampling Units.
As the research is basically designed to study the satisfaction level of retailers, the sample
chosen includes mainly the retailers.
Time period.
1st June 2004 to 31st Aug 2004
INSTRUMETATION TECHNIQUES:
In this study, the one and only way to reach people is through questionnaire, because of
the simplicity and clearly worded question of the questionnaire, it is quite easy to ask
information directly from respondents concerning behavior, demographic characteristics
level of knowledge, attitudes, beliefs and feelings .Even with the people who not give
personal interviews (or) whole responses might be biased (or) distorted by interviews, the
questionnaire does not take much time of the respondents to get filled up.
SOURCES OF DATA:
The researcher can gather secondary data, primary data (or) both for analysis.
SECONDARY DATA:
Secondary data is defined as data earlier for a purpose other than the one current being
pursed. In other words, any data which is available prior to the commencement of a
research is secondary data.
ADVANTAGES:
• Low cost of data collection.

• It offers much insight and sufficient information which may be sufficient
to solve the marketing problem (or) research question.
• It is useful as reference base to compare research findings.
• Time required to obtain the relevant secondary data is much lower
compared to the same collected from primary data.
LIMITATIONS:
• Data are collected for different propose and by different people.

• Access to secondary data may not always be possible in view of propriety
and confidentially barrier.
PRIMARY DATA:
Primary data is the data collected for meeting the specific objectives of the research
study. The methods used for collecting primary data may be,
• SURVEY:
• The process of soliciting information from people by personal interview (or)
mailing. The format of data maybe structured (or) unstructured, and direct
(or) indirect.
• OBSERVATION:
• The process of noting and recording information about people and their
behavior without asking people specific question.
Observation mode of data collection is highly effective in customer survey

where the respondents are unwilling (or) unable to provide information asked
.Data collected by observation and time consuming than survey data.
PROJECT APPLICATION:
For the purpose of the present study the data from two sources has been selected i.e.
primary and secondary data.
PRIMARY DATA:
Information was collected through the use of questionnaire, which formed the primary
data. The questionnaire was administered in person.
SECONDARY DATA:
Secondary data has been collected from many sources. The source of secondary data was
collected from company reports, journals, magazines, text books, and internet.
DATA PROCESSING AND ANALYSIS PLAN:
For the purpose of analyzing, processing and interpreting the data, percentage analysis
has been given in the form of a table and followed by an appropriate analysis and also
backed up by suitably relevant and Pie charts wherever found necessary
OBJECTIVES:
sampling plan.
industries limited.
ETHICS OF THE RESEARCH

The designed questionnaire does not hurt the feelings of the respondents i.e.
retailers. The report is based on the facts and figures collected from the respondents,
is not manipulated or misleading in any of the way.
LIMITATIONS OF THE STUDY
1. The study is confined to Hubli only. Any changes in this area do not portray any
exact result to other locations as market situation differ from one place to another.
2. The respondents who did not participate in the survey that might have affected to
the study. Because of not getting the opinion from these respondents.
3. The sample was chosen randomly which might not be actual representa -tive of
the total population, due to which there may an error.
4. The information given by few dealers deemed to be correct in the beginning later
on were found to be partial incorrect, which caused in convenience.
5. Many of the respondents gave a negative answer in order to finish the interview
quickly, which may affect in the study.
DATA ANALYSIS
Table 1: Retailers dealing with different brands of biscuits.
Company Respondent Percentage

Britannia 43 43%
Parle 47 47%
Kwality 9 9%
Others 1 1%
Respondent
9% 1%
Britannia
43%
Parle
Kwality
47% Others
Analysis:
Britannia Industries Limited, with a retailers coverage of 43% follows Parle which
has 47% of the retailers selling Parle products. Kwality comes next with 9% and other
biscuit manufacturing Companies come under the remaining 1% in terms of retailers
who deal mainly with specific Companies.
Britannia Industries Limited should focus on strong distribution channel and cover
most retailers outlet to make the products readily available at all the places.
Table 2: Table showing brands in highest sales.
Brand name No of respondent Percentage

Britannia 50 50%
Parle 48 48%
Kwality 2 2%
No of respondent
2%
Britannia
Parle
48% 50%
Kwality
Analysis:
In terms of sales Britannia products sum up to 50% of the total sales at retailers place.
Britannia products stand first followed by Parle with 48% of the total sales and
Kwality with just 2%.
Table 3: Table showing glucose brands in highest sales.
Company Respondents
Britannia 32
Parle 60
Kwality 8
Exhibit 3: Graph glucose brands in highest sales.
Respondents
32% 60% Britannia

Parle
Kwality
8%
Analysis:
In the glucose segment, Parle-G is the market leader with 60% of the total biscuit market
captured by it. Britannia with 32% of the total sales comes next and then comes Kwality
biscuits with 8% of the market share.
Britannia can focus on glucose segment as it has a large consumer base to compete with
Parle in that segment. In the premium segment Parle comes next only after Britannia.
Table 4: Which Premium brands are doing well?
Company Responds
Britannia 73
Parle 27
Responds
27%
Britannia
Parle
73%
Analysis:
In the premium brands(brands consumed by middle class and above) Britannia is the
leader with 73% of the total sales followed by Parle at 27%.The company should take
up promotional activities like offers, gift coupons, etc . to retain the top position.
Table 5: Table showing number of dealers dealing with Britannia.
Years Respondents
Less than 1 years 12
1-5 years 22
5-10 years 38
More than 10 years 18
Respondents
Less than 1 years
20% 13%
1-5 years
24% 5-10 years

43%
More than 10
years
Analysis:
The table shows the number of years the retailers are associated with Britannia
Industries Ltd. From the table it is seen that 56 of the respondents(retailers ) are with
Britannia Industries Ltd. Since more than 5 years. This shows the satisfaction level of
retailers with Britannia Industries and its products. The scope for new entrants to ell
Britannia products is also less as the existing retailers are doing well.
Table 6: Table showing rank factors helping to push Britannia .
Factor Ranks
1 2 3 4 5 6 7
Brand image 10 20 23 30 14 10 8
Quality 9 13 30 15 17 7 7
Availability 5 3 8 10 6 22 50
Credit facility 36 35 14 12 7 2 1
Margin 27 18 12 11 8 3 1
Delivery 2 4 4 2 10 39 24
service
Advertisement 11 7 8 20 38 17 9
Total 100 100 100 100 100 100 100
B ra n d im a g e
11%
10% 9% Q u a lit y
2% A va ila b ilit y
5%
C re d it fa c ilit y
27%
M a rg in
36% D e live ry s e rvic e
A d ve rt is e m e n t
Analysis:
The table and the exhibit shows the various points which were asked to the retailers to
push the products. The retailers were asked about the Company’s brand image,
quality, availability, credit facility, margin, delivery service, advertisement, etc. The
response obtained from the retailers in the decreasing order of importance are :
¾Credit facility
¾Margin
¾Brand image
¾Advertisement
¾Availability
¾Quality and
¾Delivery service.
Table7: Table showing different kinds of market support that are needed by
the retailers from the company.
Factors Responds
More profit margin 10

Regular supply 5
Credit facility 35
Discount 30
Offers 20
Responds
10%
20% More profit margin
5%
Regular supply
Credit facility
30% 35%
Discount
Offers
Analysis:
From the study it is found that the retailers want maximum support from the
Company to sell the products. The retailers want credit facility from the company as
the market wants credit else it will shift to other company which gives them credit.
The retailers also expect huge discounts and offers from the company to push the
products. More profit margin is also what the retailers look in for as they are also in
the market to earn money. Regular supply of the products from the Company to the
stockiest and to the retailers helps in catering to the needs of the consumers.
Table 8: Table showing satisfaction level with the service given by the
Annapurna traders.
Satisfaction Level Respondents

Very much Satisfied 30
Satisfied 64
Not satisfied 6
Respondents
6% Very much
30% Satisfied
Satisfied
Not satisfied
64%
Analysis:
The retailers who are dealing with Britannia products through Annapurna traders
(stockiest for Hubli city) are satisfied with the service provided by their stockiest. 6%
of the retailers are not satisfied with the service.The stockiest should find out the
reasons for their dissatisfaction. The stockiest can solve the retailers problems if its in
their level or can seek help from the company. The stockiest should concentrate on
such areas to improve the sales to increase the market share.
Table 9: Table showing retailers who take up promotional activities.
Satisfaction Level Respondent

Yes 34
No 66
Respondent
34%
Yes
No
66%
Analysis:
From the study it is found that apart from Company’s promotional activities, stockiest
and retailers at the district and town level should take up promotional activities to
boost up sales. Company should support them in all respects. Majority of the retailers
don’t take up promotional activities as it adds to their overheads. For few retailers it
has become like family business and has a huge customer base built up over time.
Promotional activities help retailers to attract new consumers.
Table 10: Table shows on time delivery given by the distributors.
Satisfaction Level Respondent

Yes 94
No 06
Respondent
6%
Yes
No
94%
Analysis:
Delivery time is very important for retailers and stockiest. Retailers should receive
the products in time so that the end-users are benefited. The retailers can retain the
customers in this way.
CONCLUSION
From the research it is concluded that the distribution channel of the Britannia play a
vital role in success & survival of the brand. Britannia Industries Limited, should adopt right
distribution process for products & also through the proper intermediaries. Company can
concentrate on factors like appointment of the dealers/ distributors, their remuneration
method, terms of payment etc,
Britannia is market leader. Parle is the main competitor for Britannia. Concentration has
to be given on the glucose Biscuit Tiger brand. The premium segment (varieties) of Britannia
is doing very well. Margin, brand image, credit facility, advertisement will help retailers to
push the products. Retailers also want some offers from the Company to push the products
fast in the market.
BIBLIOGRAPHY:
o TEXT BOOKS
Market Rearch by TULL AND HAWKINS

Marketing Management by PHILIP KOTLER
Fundamentals of research by Willian J. Stanton
Marketing management by S. A. Sherlekar
o MAGAZINES
Business World
Business Today
India Today
The Week
Intelligent Investor
o NEWS PAPERS
The Times Of India

The Hindu
Economic Times
o WEB SITES
www.google.com
www.rediffmail.com
QUESTIONNAIRE
Respected Sir/Madam,
I would like to introduce myself as Ashwin S.Halbavi, student of B.V.B’s. M.P.Birla

Institute of Management, Banglore. As part of our curriculum I have to under go a
project. I am doing a project on “Distribution channels and Retailers satisfaction with
Britannia industries limited”. I need your kind cooperation by completing this
questionnaire.
1) Name ________________________________
2) Address _________________________________
_________________________________
_________________________________
3) Which biscuit brands are you dealing with?
a) Britannia b) Parle
c) Kwality d) Others__________
4) Which biscuit brands are having highest sales?
c) Kwality d) Others_________
5) Which of the glucose biscuit are doing well?

a) Britannia Tiger b) Parle-G
c) Others___________________________
6) Which are the premium biscuit (variety) are doing well?

c) Others _____________
7) Which company products are in the highest sales in terms of sales?

c) Kwality d) Others ___________
8) Since how many years you are dealing with Britannia products ?
a) Less than 1 year b) 1-5 years
c) 5-10 years d) more than 10 years
9) Rank the factors of Britannia, which help to push Britannia products?

a) Brand image e) Margin
b) Quality f) Delivery
c) Availability g) Advertisement
d) Credit facility h) Others ___________
10) Which type of market support you need from the company?
a) More profit margin d) Discount
b) Regular supply e) Offers
c) Credit facility f) Others __________
11) Where you purchase biscuits?
a) Distributors
b) Directly from company
12) How many times a person from the Distributor come to you for
Taking up of the orders?
a) Once a week c) Once 10 days
b) Twice a week d) Once in 15 days
13) Whose distribution is good & why?
14) How do you feel service given by Annapurna Traders ?

a) Very much satisfied b) satified
c) Not satisfied
15) Which are the factors will help you to increase in sales?
a) Discounts b) Margin c) Regular supply
d) Order on phone e) Replacements
16) Have you come across any intensive/ gift by Britannia delighted you most?
a) Yes b) No
If yes,
What is that?_______________
For what Reason?___________
17) Any offers are Scheme provided by company are fully made available to you?
a) Agree b) Disagree c) Don’t know
18) Do you get ordered goods on time?
a) Yes b) No
19) Do you take up promotion activities?

a) Yes b) No
20) Your suggestions.______________________________

______________________________
_______________________________
In case of in –sufficient space for suggestions attach a page or write on

the back. THANK YOU FOR YOUR KIND CO-OPERATION.

Ashwin-Annapurna Traders

Uploaded by

Copyright:

Available Formats

Ashwin-Annapurna Traders

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Ashwin-Annapurna Traders

Uploaded by

Copyright:

Available Formats

DECLARATION

I here by certify that this project report entitled “Distribution Channels

This project report was prepared by me in partial fulfillment of the

The forces of globalization and technological change have opened up new

The study was conducted with following objectives:

STUDY OF THE PROBLEM

Food industry contributes to about 18 % of India’s manufacturing Output and

India is the World’s second largest biscuit industry (after

Consumer Habits And Practices

A sizable volume of biscuits is consumed at small roadside tea shops/ stalls

Low capital intensity:

High initial launch cost:

Calcium and iron

Anticipating the competition. It has also recently acquired Kwality Biscuits,

Biscuits (82.7%of turn over)

Bread (4.6% of turnover)

Dairy products (9.8% of turnover)

Cake &Rusk (2% of turnover)

Earnings, sensitivity factors.

-Britannia Industries Ltd has launched a festival offer for Britannia

-The company launched vita mariegold, a semi-sweet biscuit that

-Britannia’s Milk Bikis Funland biscuits and innovative extension in the

-The industry is set to start brand- manufacturing factories in Kochi, Hyderabad

- A Britannia industry launched Britannia Milkman Butter, a product under the

- The company appointed Tata Energy Research Institute (Teri) for a

- Britannia Industries Ltd. introduced a new range of traditional

-The management of Britannia Industries dropped John Miller, a Danone

According to former Britannia Industries managing director & CEO Mr Sunil

Britannia Industries leads in the Rs 2,000-crore branded biscuits Market with a

The American Marketing Association defines distribution channel as structure of

It can be further stated as “a pathway composed of Intermediaries, also called

CHANNEL FUNCTION AND FLOWS

A distribution system is a key external resource. Normally it use years to build

a) Full function wholesalers:

Retailers may be defined as that merchant intermediary who buys Products

A brief description of the institutional retailers is given below.

1) Consumers Co operative Stores: These are retail stores owned by

3) Departmental Stores: A departmental store is a big retail with many

Agent intermediary may be further classified has follows:

A zero level channel (also called a direct marketing channel) consists of a

CHANNEL DESIGN DECISION

In designing marketing channels, manufactures have to decide what is ideal, what is

ANALYSING CUSTOMER’S DESIRED OUT PUT LEVELS

Special convenience: Spatial convenience expresses the degree to which the

ESTABLISHING THE CHANNEL OBJECTIVES AND

The channel objective should be in terms of targeted service output levels.

Channel objectives vary with product characteristics. Perishable Product requires

PRIMARY AND SECONDARY SALES METHOD ADOPTED BY

Relationship marketing is an important part of managing the marketing channel.

Condition of sales refers to payment terms and producers guarantees, most

MOTIVATING CHANNEL MEMBERS

Stimulating channel members to top performance must start with understanding of

• Coercive power : a manufacturer wields it that they’re to draw resources or to

• Reward power : It occurs when the manufacture offers intermediaries an extra

• Legitimate power : It is wished when the manufacturer request a behavior that

• Referent power: It occurs when the manufacturer is so highly respected that

Long sophisticated companies try to forge a long-term Partnership with their

TERMS AND CONDITIONS FOR APPOINTMENT OF

When in territory scope is there needs essential activities of a dealer. These

Dealers meeting can be arranged where problems of dealers (either