SDM Assignment - Irate Distributor

Group 8

Vikram Hanji - 51B

Ques 1. What is the background on the retail trade in India and the situation in which
Amit Kumar has taken over his territory?
Ans1.

India's Retail Industry

With a wide variety of retail formats, including modern supermarkets, mom-and-pop stores, and
e-commerce websites, India has a sizeable and diverse retail market. Rising disposable
incomes, increasing urbanisation, and changing consumer preferences are all contributing to
the retail industry's rapid growth. Unorganised retailers in India account for about 85% of total
retail sales.

Despite its rapid expansion, organised retail still accounts for a very small share of total sales.

Amit Kumar's Situation

As an area sales manager, Amit Kumar has joined NutriPack India, a multinational manufacturer
of fast-moving consumer goods. He now governs an area that brings in 631.1 million rupees a
year. His predecessor, Rahul Ray, was instrumental in growing NutriPack India's activities in the
area.

Kumar is coping with a number of issues, including:

Ques 2. How did Kumar choose the Jalgaon district for the expansion plan in his
territory?

Ans2.
Amit Kumar carefully considered the following aspects before deciding on the Jalgaon area as
the location for his territory's expansion plan:

• Growth Potential: Kumar looked at how each district under his supervision had grown in the
years prior. There appears to be potential for further expansion since Jalgaon has shown
consistent and positive growth.
• Population and Spending Power: Kumar examined the population and per capita spending
power of every district. For NutriPack India's products, Jalgaon was a suitable market because it
had a large population with relatively high spending power.
• Market Share of Product Lines: Kumar assessed the market share of each item for
NutriPack India in each district. Jalgaon's market share was quite low compared to its potential,
suggesting a large margin for growth.

• Retail Coverage of Outlets: Kumar evaluated how well NutriPack India's products were sold
in each district. Given its modest retail footprint, Jalgaon presented an opportunity to expand
distribution and draw in more clients.

• Existing Brand Rivalry: Kumar looked at how much rivalry there was from different HFD
brands in each district.

A focused expansion strategy would be necessary to obtain a competitive edge given the
volume of rivals in Jalgaon.

Considering all of these factors, Kumar concluded that the Jalgaon district possessed plenty of
potential for NutriPack India to expand. The goals of the expansion plan were to take on a larger
market and increase brand awareness, increase store penetration, and increase market share
in the district.

Q.3 Analyze the different perspectives of Kumar (company) and Mandore (distributor),
regarding their approaches on going to market.

Ans 3.
Kumar's Perspective and Approach
Amit Kumar, the area sales manager for NutriPack India, wants to increase the company's
market share in the Jalgaon area. He believes that in order to accomplish this goal, expanding
retail coverage and attracting more customers are crucial. Kumar is also concerned about the
low profitability of NutriPack India's distributor in Jalgaon, Sachin Agency. He believes that in
order to finance the expansion plan and boost profitability, Mandore needs to increase his
investments.
Kumar's strategy:
• Boost marketing and sales efforts in the Jalgaon area;
• Increase retail reach by adding new locations to the distribution network; and
• Convince Mandore to provide more money to support the expansion plan.

Mandore's Perspective

Sachin Mandore, the distributor for NutriPack India in Jalgaon, is concerned about the financial
performance of his company. He believes that his current 4.5% profit margin is insufficient, and
he is reluctant to make more investments unless he is positive they will increase his revenue.
Mandore is also concerned about the increasing competition from other HFD brands in the
Jalgaon region. He feels that NutriPack India ought to be doing more to support and equip its
distributors with the resources they require to effectively compete.

Mandore's strategy :
• Increase revenue by negotiating a higher distributor margin with NutriPack India;
• Get additional support from NutriPack India for marketing and sales campaigns; and
• Ensure that NutriPack India's products are competitive in the Jalgaon market.

The following are the main differences in Mandore's and Kumar's perspectives: Mandore is
more concerned with increasing his profitability, whereas Kumar is more concerned with
expanding NutriPack India's market share.
➢ Investment in Profitability vs. Investment in Expansion: Kumar believes that Mandore should make
larger financial investments to support the expansion strategy, while Mandore believes NutriPack India
should help its distributors more.
➢ Distributor Role vs. Company Role: Mandore believes NutriPack India should be doing more to
support its distributors, while Kumar believes distributors should be making larger investments to support
the company's growth objectives.

NutriPack India and Sachin Mandore will need to work out a solution to address these divergent
opinions in order to establish a presence in the Jalgaon district. In order for him to become more
profitable, the company has to convince Mandore that the growth plan is worth the shot and that
he should be willing to invest in it.

Q.4 Based on the information available in the case, what should Kumar’s
recommendations be for strengthening the Sachin Agency and tapping into the potential
of the Jalgaon district?

Ans 4.
Recommendations to Sachin Agency

(ⅰ) Invest and expand the business.

(ⅱ) Increase personal visits to retailers.

(ii) Credit period should be increased.

(iv) Uniform schemes and cash discounts across all outlets of similar value.

(v) Discretion of offering discounts should be with Mandore, not with salesman.

(vi) Clear all dues with Mandore to gain his trust.

(vii) Because of low margin product, sales should be increased by giving more offers to
customer.