PROJECT REPORT

ON
CHANNEL MANAGEMENT PROJECT
ASSIGNMENT: RETAIL MANAGEMENT

SALES AND DISTRIBUTION MANAGEMENT

UNDER THE GUIDANCE OF SUBMITTED BY

Prof. Joydeep Biswas Rudra Prakash Das(22202100)

(Assistant Professor, KSOM) Dipankar Sahu(22202186)

Shamla K Chowdary(22202152)

Debidutta Panda(22202185)

Rudra Madhab Sahoo(22202099)

 DECLARATION
We hereby declare that the project entitled CHANNEL MANAGEMENT PROJECT
ASSIGNMENT: RETAIL MANAGEMENT” submitted in partial fulfillment of the
requirement for MARKETING MANAGEMENT - II to PROF. JOYDEEP BISWAS, KIIT
SCHOOL OF MANAGEMENT at Campus-7, KIIT University, Chandaka Industrial Estate
Bhubaneswar, Odisha 751024 is our original work and has not been copied from any other
sources.

GROUP MEMBERS
Rudra Prakash Das(22202100)

Dipankar Sahu(2202186)

Shamla K Chowdary(22202152)

Debidutta Panda(22202185)

Rudra Madhab Sahoo(22202099)

 ACKNOWLEDGEMENT
This report has been made with the cooperation of many people to whom we wish to express
our gratitude and appreciation. We are very grateful to the people who supported us transform
the report into a materialistic form. We are very much thankful to Prof. Joydeep Biswas,
faculty - Marketing, KIIT School of Management for his gratitude during our project and for
giving us full co-operation and also valuable information and guidance, without which it would
not be possible for us to complete the project. We would also like to thank the librarians and
other staff members of KIIT School of Management for providing us with the required books
in this field and our friends who were always there to assist us at odd hours.
 INTRODUCTION
Retail involves the sale of individual or small batches of products directly to consumers from
a permanent location like a department store, boutique, or via mail. In business, a "retailer"
purchases goods in bulk from manufacturers or importers, either directly or through a
wholesaler, and then sells smaller quantities to end consumers. Retail enterprises, often
referred to as shops or stores, represent the final link in the supply chain. Manufacturers view
retailing as a crucial part of their overall distribution strategy. Retail establishments can be
situated on residential streets, commercial retail areas, or within malls. The overall concept of
retailing centers on the exchange of goods between sellers and end-users in units or small
quantities to fulfill individual needs for direct consumption.
A Distribution Channel comprises a sequence of businesses or intermediaries through which
a product or service passes before reaching the ultimate buyer or end consumer. Examples of
distribution channels include wholesalers, retailers, and distributors. It constitutes a network
of interconnected entities collaborating to bring a product or service into availability for use
or consumption. These interconnected firms are relatively uniform in terms of trading
behavior and the types of customers they cater to.

Types Of Distribution Channels

Distribution channels can be categorized into different levels based on the number of
intermediaries involved in the process of getting a product from the producer to the
consumer. The major types of distribution channel levels are:
Zero-Level Channel (Direct Marketing):
• Involves direct selling from the producer to the consumer.
• No intermediaries are involved.
Examples include online sales, direct sales representatives.
One-Level Channel (Single Intermediary):
• Involves one intermediary between the producer and the consumer.
• Commonly seen in retail settings.
Examples include a manufacturer selling to a retailer who sells to the consumer.
Two-Level Channel (Multiple Intermediaries):
• Involves two intermediaries between the producer and the consumer.
• Commonly includes a wholesaler and a retailer.
Example: Manufacturer sells to a wholesaler, who then sells to a retailer, and finally to the
consumer.
Three-Level Channel (Multiple Intermediaries):
• Involves three intermediaries between the producer and the consumer.
• Includes a producer, a wholesaler, a retailer, and then the consumer.
• Common in complex distribution networks.

PROCESS
In this project, our focus is on understanding channel management within the context of store
operations and transactions. This includes a comprehensive examination of interactions with
distributors and wholesalers for different brands and stock-keeping units (SKUs) within a
specific category.

CHOCOLATES AND CONFECTIONERY – CATEGORY

The chocolates and confectionery category is a sweet and indulgent sector within the food
industry that encompasses a wide range of delightful treats. Comprising chocolates, candies,
gum, and various sugary delights, this category is characterized by its diverse flavors,
textures, and forms.
Marketing strategies in the chocolates and confectionery category frequently emphasize the
emotional aspect of these products, linking them to moments of joy, celebration, and
indulgence. Packaging plays a crucial role, with many products adorned in eye-catching
designs to enhance their shelf presence.
While the category embraces traditional favorites, there's also a growing trend toward
incorporating healthier ingredients, catering to health-conscious consumers. This shift has led
to the development of dark chocolates, sugar-free options, and confectionery products with
natural and organic ingredients.
We visited multiple retail establishments to investigate the leading three chocolate and
confectionery brands, exploring the primary reasons customers choose these brands and
examining the distribution practices across different aspects of the relationship between
distributors, wholesalers, and retailers. Below, you'll discover various specifics regarding
how retailers operate and engage with distributors and wholesalers.
 STORE – 1 : MITHAI JALARAM

Highest Selling SKU

KitKat – Rs 20
Munch – Rs 10
KitKat – Rs 10

KitKat (Rs 20 Pack)

Key Reasons For Consumer Buying These

Brands
A variety of chocolates clubbed together
Gift purpose

# Information Value/Details
i Final retail sales 20
ii Gross Margin 4
iii Retailer Margin (%) (4/20)*100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (300-200)/2=50
v Service Frequency from Thrice a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Melted chocolates need to be kept in the
refrigerator
- Review inventory periodically
ix Display Key of Products Share of facings = Facings for brand/ Total facings
in the category= 6/72=0.083=8.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 72,000 Cost of
Good sold- Rs 58,000
Average inventory cost- Rs 9,600
Gross Margin- Rs 72000- Rs 58000 = Rs 14000
GMROI= 14000/9600 = 1.45
xii Channel conflict examples -Vertical conflict is faced sometimes.
-In case of spoilage (like melted products),
there is return of products or any scheme to
resale.

xiii Industry Specific Learning - The chocolate is stored in the lower rack, but still
has its visibility due to its attractive packing. They
have a good sales over this product.

2. Munch (Rs 10 Pack)

Key Reasons For Consumer Buying These

Brands
Chocolate wafer
Crunchy Nature
Well known tasted brand

# Information Value/Details
i Final retail sales 10
ii Gross Margin 1.5
iii Retailer Margin (%) (1.5/10) 100= 15.00%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =(400-
(monthly) 200)/2=100
v Service Frequency from Twicw a month
Distributor
vi Credit Limit by Distributor ₹2000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Melted chocolates need to be kept in the
refrigerator
- Review inventory periodically
ix Display Key of Products Share of facings = Facings for brand/ Total facings
in the category= 8.3%(total 4 parts of the rack and
1/3rd of one part of rack)
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 40,000 Cost of
Good sold- Rs 35,000
Average inventory cost- Rs 4000
Gross Margin- Rs 40000- Rs 35000 = Rs 5000
GMROI= 5000/4000 = 1.25
xii Channel conflict examples -Vertical conflict is faced sometimes.
-In case of spoilage (like melted products),
there is return of products or any scheme to
resale.
xiii Industry Specific Learning Merchandisers, responsible for maintaining
displays at distribution points covering 40-50
outlets per week, however lack motivation, and
gauging their effectiveness is challenging. To
 address this, recommend introducing Rs. 400-500
incentives based on performance. Sales

3. KitKat (Rs 10 Pack)

Key Reasons For Consumer Buying These

Brands
Chocolate wafer
Variety Of Flavors

# Information Value/Details
i Final retail sales 10
ii Gross Margin 2
iii Retailer Margin (%) (2/10) 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2
(monthly) =(400-300)/2=50
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹2000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
- Review inventory periodically
ix Display Key of Products Share of facings = Facings for brand/ Total
facings in the category= 12/72 = 0.166 = 1.6%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 25,000 Cost of
Good sold- Rs 20000
Average inventory cost- Rs 2000
Gross Margin- Rs 25000- Rs 20000 = Rs 5000
GMROI= 5000/2000 = 2.5
xii Channel conflict examples - Vertical conflict is faced sometimes.
- In case of spoilage (like melted products),
there is generally bargaining of schemes.
- In case of out of trend of some flavours,
there are stocks, which remain unsold.

xiii Industry Specific Learning Merchandisers, responsible for maintaining

displays at distribution points covering 40-50
outlets per week, however lack motivation, and
gauging their effectiveness is challenging. To
address this, recommend introducing Rs. 400-
500 incentives based on performance. Sales
Officers can measure productivity through
frequent visits and feedback from distributor
salesmen, fostering improved dedication.
 STORE – 2 : VIVAAN MINI MART

Highest Selling SKU

Cadbury Celebration – Rs 150
Ferrero Rocher – Rs 529
Cadbury Dairymilk Silk – Rs 70

Cadbury Celebration – Rs 150

Key Reasons For Consumer Buying These

Brands
A variety of chocolates clubbed together
Gift purpose

# Information Value/Details
i Final retail sales 150
ii Gross Margin 9
iii Retailer Margin (%) (9/50) * 100= 6%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (30-`10)/2=10
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹2000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms -Ensure visibility
ix Display Key of Products Share of facings = Facings for brand/ Total facings in
the category= 33%(1/3rd of total place)
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 110,000
Cost of Goods sold- Rs 100000
Average inventory cost- Rs 4,000
Gross Margin- Rs 110000- Rs 100000 = Rs 10000
GMROI= 10000/4000= 2.5
xii Channel conflict examples -The major problem in the marketing channel is
the insufficient supply of local milk producers,
resulting in importation from other provinces. This
results from low trade support and management.
-Another prevailing problem is the unhealthy
competition among processors, who produce
almost the same products with varied levels of
quality.
-Demand also challenges the dairy industry due to
the seasonal and fewer number of people who buy
these products. Furthermore, the low supply of
milk is greatly attributed to low produce.

xiii Industry Specific Learning - Dairy milk is one of the most consumed chocolates all
over the country, consumed especially by youths,
innovation in texture of chocolate will result in greater
demand.

Ferrero Rocher – Rs 529

Key Reasons For Consumer Buying These

Brands
Premium product
Gift purpose

# Information Value/Details
i Final retail sales 529
ii Gross Margin 66
iii Retailer Margin (%) (66/529) 100= 12.47%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (60-`20)/2=20
v Service Frequency from Once a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Share of facings (Rs 529 Pack Ferrero Rocher)=
Facings for brand/ Total facings in the
category=13/25=0.52=52%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 1,00,000 Cost of
Goods sold- Rs 85,000
Average inventory cost- Rs 8000
Gross Margin- Rs 1,00,000- Rs 85,000 = Rs 15000
GMROI= 15000/8000 = 1.875
xii Channel conflict examples - Vertical conflict is faced sometimes.
-In case of spoilage (like melted products), there is
generally bargaining of schemes
xiii Industry Specific Learning - These products often help us to relate to our
childhood, having choco rolls and less conflict in the
channel.

Cadbury Dairymilk Silk – Rs 70

Key Reasons For Consumer Buying These

Brands
Chocolate that melts in your mouth.
Emotional Connect

# Information Value/Details
i Final retail sales 529
ii Gross Margin 66
iii Retailer Margin (%) (66/529) 100= 12.47%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (60-`20)/2=20
v Service Frequency from Once a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Share of facings (Rs 529 Pack Ferrero Rocher)=
Facings for brand/ Total facings in the
category=13/25=0.52=52%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 1,00,000 Cost of
Goods sold- Rs 85,000
Average inventory cost- Rs 8000
Gross Margin- Rs 1,00,000- Rs 85,000 = Rs 15000
GMROI= 15000/8000 = 1.875
xii Channel conflict examples - Vertical conflict is faced sometimes.
-In case of spoilage (like melted products), there is
generally bargaining of schemes
xiii Industry Specific Learning - These products often help us to relate to our
childhood, having choco rolls and less conflict in the
channel.
 STORE – 3 : GITA FRESH

Highest Selling SKU

Hershey Kisses- Rs 100
Ferrero Rocher – Rs 529
Dairy Milk Silk - Rs 80

1.Hershey Kisses- Rs 100

Key Reasons For Consumer Buying These

Brands
Gifting Purpose
Juicy Chocolate Drops

# Information Value/Details
i Final retail sales 529
ii Gross Margin 66
iii Retailer Margin (%) (66/529) 100= 12.47%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2
(monthly) = (60-20)/2=20
v Service Frequency from Once a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Share of facings (Rs 529 Pack Ferrero Rocher)=
Facings for brand/ Total facings in the category=
13/25=0.52=52%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 1,00,000 Cost of
Goods sold- Rs 85,000
Average inventory cost- Rs 8000
 Gross Margin- Rs 1,00,000- Rs 85,000 = Rs 15000
GMROI= 15000/8000
= 1.875
xii Channel conflict examples - Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability.
xiii Industry Specific Learning - - Hershey’s Kisses is one of the most consumed
chocolates all over the country, consumed specially by
youths, innovation in texture of chocolate will result in
greater demand.

2.Ferrero Rocher - Rs 529

Key Reasons For Consumer Buying These

Brands
Premium product
Gift purpose

# Information Value/Details
i Final retail sales 100
ii Gross Margin 10
iii Retailer Margin (%) ((10/100) 100= 10%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (200-50)/2=75
v Service Frequency from Once a month
Distributor
vi Credit Limit by Distributor ₹2000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Share of facings (Rs100 Hersheys Kisses) =
Facings for brand/ Total facings in the category=
20/55=0.363=36.36%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 90,000 Cost of Goods
sold- Rs 81,000
Average inventory cost- Rs 7000
Gross Margin- Rs 90000- Rs 81000 = Rs 9000
GMROI= 9000/7000= 1.28
xii Channel conflict examples - Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability and high price of cost.
xiii Industry Specific Learning Ferrero Rocher is one of the most premium chocolates
all over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.
 3.Dairy Milk Silk - Rs 80

Key Reasons For Consumer Buying These

Brands
Taste and Quality
Gift purpose

# Information Value/Details
i Final retail sales 80
ii Gross Margin 12
iii Retailer Margin (%) (12/80) 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-60)/2=20
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
4/32=0.125=12.5%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 80,000 Cost of Good
sold- Rs 70,000
Average inventory cost- Rs 16,000
Gross Margin- Rs 80000- Rs 70000 = Rs 10000
GMROI= 10000/9600= 1.45
xii Channel conflict examples - The major problem in the marketing channel is
the insufficient supply of local milk producers,
resulting in importation from other provinces. This
results from low trade support and management.
- Another prevailing problem is the unhealthy
competition among processors, who produce
almost the same products with varied levels of
quality.
- Demand also challenges the dairy industry due to
the seasonal and fewer number of people who buy
these products. Furthermore, the low supply of
milk is greatly attributed to low produce.
xiii Industry Specific Learning Dairy milk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.
 STORE – 4: ÉCLAIR HOME BAKED

Highest Selling SKU

Dairy Milk Silk- Rs 80
Fuse – Rs 30
Dairy Milk - Rs 20

1.Dairy Milk Silk- Rs 80

Key Reasons For Consumer Buying These

Brands
Taste and Quality
Unique Flavor

# Information Value/Details
i Final retail sales 80
ii Gross Margin 12
iii Retailer Margin (%) ((12/80) 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-60)/2=20
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
4/32=0.125=12.5%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 80,000 Cost of Good
sold- Rs 70,000
Average inventory cost- Rs 16,000
 Gross Margin- Rs 80000- Rs 70000 = Rs 10000
GMROI= 10000/9600 = 1.45
xii Channel conflict examples The major problem in the marketing channel is
insufficient supply of local milk producers,
resulting to importation from other provinces. This
results from low trade support and management.
xiii Industry Specific Learning Dairymilk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.

2.Fuse – Rs 30

Key Reasons For Consumer Buying These

Brands
Taste and Quality
Reasonable Price

# Information Value/Details
i Final retail sales 30
ii Gross Margin 4
iii Retailer Margin (%) ((4/30) 100= 13%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (50-10)/2=20
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
4/32=0.125=12.5%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 14,400 Cost of Good
sold- Rs 7,680
Average inventory cost- Rs 2,000
Gross Margin- Rs 14,400- Rs 7,680 = Rs 6,720
GMROI=6720/2,000 = 3.36
xii Channel conflict examples Demand also challenges the dairy industry due to
the seasonal and fewer number of people who buy
these products. Furthermore, the low supply of
milk is greatly attributed to low produce.
xiii Industry Specific Learning One of the most consumed chocolates all over the
country, consumed specially by youths, innovation in
texture of chocolate will result in greater demand.
 3. Dairy Milk - Rs 20

Key Reasons For Consumer Buying These

Brands
Soft Creamy Taste
Affordable Price

# Information Value/Details
i Final retail sales 20
ii Gross Margin 4
iii Retailer Margin (%) ((4/20) 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (300-100)/2=100
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
6/72=0.083=8.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 48,000 Cost of Good
sold- Rs 38,400
Average inventory cost- Rs 3,000
Gross Margin- Rs 48,000- Rs 38,400 = Rs 9,600
GMROI= 9,600/3,000 = 3.2
xii Channel conflict examples The major problem in the marketing channel is
insufficient supply of local milk producers,
resulting to importation from other provinces. This
results from low trade support and management.
xiii Industry Specific Learning Dairymilk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.
 STORE – 5: SAINATH GROCERY & VARIETY STORE

Highest Selling SKU

KitKat- Rs 20
BarOne – Rs 10
Dairy Milk - Rs 10

1.KitKat- Rs 20

Key Reasons For Consumer Buying These

Brands
Soft Creamy Taste
Affordable Price

# Information Value/Details
i Final retail sales 20
ii Gross Margin 4
iii Retailer Margin (%) ((4/20) 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (300-200)/2=50
v Service Frequency from Thrice a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
6/72=0.083=8.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 62,000 Cost of Good
sold- Rs 48,000
Average inventory cost- Rs 6,600
Gross Margin- Rs 72000- Rs 58000 = Rs 14000
GMROI= 14000/6600 = 2.12
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes. In case of out of trend, there
are stocks, which remain unsold.
xiii Industry Specific Learning Merchandisers, responsible for maintaining displays at
distribution points covering 40-50 outlets per week,
however lack motivation, and gauging their effectiveness
is challenging. To address this, recommend introducing
Rs. 400-500 incentives based on performance.

2.BarOne – Rs 10

Key Reasons For Consumer Buying These

Brands
Soft Creamy Taste
Affordable Price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 1.5
iii Retailer Margin (%) ((1.5/10) 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (350-150)/2=100
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹2000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms - Melted chocolates need to be kept in refrigerator
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
6/72=0.083=8.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 40,000 Cost of Good
sold- Rs 35,000
Average inventory cost- Rs 4000
Gross Margin- Rs 40000- Rs 35000 = Rs 5000
GMROI= 5000/4000 = 1.25
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is return of
products or any scheme to resale.
xiii Industry Specific Learning The chocolate is stored in the lower rack, still have its
visibility due to its attractive packing. They have a
good sale over this product.
 3.Dairy Milk - Rs 10

Key Reasons For Consumer Buying These

Brands
Soft Creamy Taste
Affordable Price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 2
iii Retailer Margin (%) ((2/10) 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (400-300)/2=100
v Service Frequency from Twice a month
Distributor
vi Credit Limit by Distributor ₹2000, within 15 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
12/72=0.166=1.6%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 25,000 Cost of Good
sold- Rs 20000
Average inventory cost- Rs 2000
Gross Margin- Rs 25000- Rs 20000 = Rs 5000
GMROI= 5000/2000 = 2.5
xii Channel conflict examples -Vertical conflict is faced sometimes.
-In case of spoilage (like melted products), there is
generally bargaining of schemes.
-In case of out of trend of some flavours, there are
stocks, which remain unsold.
xiii Industry Specific Learning Merchandisers, responsible for maintaining displays at
distribution points covering 40-50 outlets per week,
however lack motivation, and gauging their
effectiveness is challenging. To address this,
recommend introducing Rs. 400-500 incentives based
on performance
 STORE – 6: BL COMMUNICATION

Highest Selling SKU

Dairy Milk - Rs 10
Five Star – Rs 10
KitKat - Rs 10

1.Dairy Milk - Rs 10

Key Reasons For Consumer Buying These

Brands
Tastes Good
Affordable Price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 1.5
iii Retailer Margin (%) ((1.5/10) 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (150-10)/2=70
v Service Frequency from Once a week
Distributor
vi Credit Limit by Distributor ₹2000, within 7-10 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
30/60=0.5=50%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 67,200 Cost of Good
sold- Rs 57,120
Average inventory cost- Rs 7,140
Gross Margin- Rs 67200- Rs 57120 = Rs 10,080
GMROI= 10,080/7140 = 1.41
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability.
xiii Industry Specific Learning Dairy milk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.

2.Five Star – Rs 10

Key Reasons For Consumer Buying These

Brands
Tastes Good
Affordable Price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 1.5
iii Retailer Margin (%) ((1.5/10) 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-20)/2=40
v Service Frequency from Once a week
Distributor
vi Credit Limit by Distributor ₹2000, within 7-10 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
10/60=0.16=16%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 38,400 Cost of Good
sold- Rs 32,640
Average inventory cost- Rs 2,040
Gross Margin- Rs 38,400- Rs 32,640 = Rs 5,760
GMROI= 5,760 / 2040= 2.82
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability.
xiii Industry Specific Learning five star consist of caramel that can be consumed when
hungry and its very smooth to chew.
 3.KitKat – Rs.10

Key Reasons For Consumer Buying These

Brands
Not very chocolaty (mixture of wafers).
Affordable Price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 2
iii Retailer Margin (%) ((2/10) 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-30)/2=35
v Service Frequency from Once a week
Distributor
vi Credit Limit by Distributor ₹3000, within 7-10 days
vii Return of Damaged Goods Returned with next lot delivery
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
10/60=0.16=16%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 33,600 Cost of Good
sold- Rs 26,880
Average inventory cost- Rs 2,880
Gross Margin- Rs 33,600- Rs 26,880 = Rs 6720
GMROI= 6720 / 2880 = 2.33
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like damaged products), there is
generally bargaining of schemes and there is
sometimes lack of support and delayed delivery,
multi-channel conflicts like unavailability.
xiii Industry Specific Learning Its very safe for the children also, consume. It can be
consumed by all age groups.
 STORE – 7: JBS MART

Highest Selling SKU

Dairy Milk - Rs 80
Galaxy – Rs 40
KitKat - Rs 20

1.Dairy Milk - Rs 80

Key Reasons For Consumer Buying These

Brands
Taste good
Unique Flavor

# Information Value/Details
i Final retail sales 80
ii Gross Margin 12
iii Retailer Margin (%) ((12/80)* 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-60)/2=20
v Service Frequency from twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 15 days
vii Return of Damaged Goods Returned while next lot delivery. (high chance, due to
expired products)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
4/32=0.125=12.5%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 80,000 Cost of Good
sold- Rs 70,000
Average inventory cost- Rs 16,000
 Gross Margin- Rs 80000- Rs 70000 = Rs 10000
GMROI= 10000/9600
= 1.45
xii Channel conflict examples The major problem in the marketing channel is
insufficient supply of local milk producers,
resulting to importation from other provinces. This
results from low trade support and management.
xiii Industry Specific Learning Dairymilk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.

2.Galaxy – Rs 40

Key Reasons For Consumer Buying These

Brands
Premium Product
Rich Creamy

# Information Value/Details
i Final retail sales 40
ii Gross Margin 4
iii Retailer Margin (%) ((4/40)* 100= 10%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (50-10)/2=20
v Service Frequency from twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 15 days
vii Return of Damaged Goods Returned while next lot delivery. (high chance, due to
expired products)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
4/32=0.125=12.5%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 19,200 Cost of Good
sold- Rs17,280
Average inventory cost- Rs 1,000
Gross Margin- Rs 19,200- Rs 17,280 = Rs 1,920
GMROI= 1,920/1,000 = 1.92
xii Channel conflict examples Vertical conflict is faced sometimes.
xiii Industry Specific Learning These products often help us to relate to our childhood,
having chocolate and less conflict in the channel.
 3.KitKat - Rs 20
Key Reasons For Consumer Buying These
Brands
Premium Product
Rich Creamy

# Information Value/Details
i Final retail sales 20
ii Gross Margin 4
iii Retailer Margin (%) ((4/20)* 100= 50%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (300-200)/2=50
v Service Frequency from thrice a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned while next lot delivery. (high chance, due to
expired products)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
6/72=0.083=8.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 72,000 Cost of Good
sold- Rs 58,000
Average inventory cost- Rs 9,600

Gross Margin- Rs 72000- Rs 58000 = Rs 14000

GMROI= 14000/9600
= 1.45
xii Channel conflict examples Vertical conflict is faced sometimes.
xiii Industry Specific Learning These products often help us to relate to our childhood,
having chocolate and less conflict in the channel.
 STORE – 8: NAGASYA COMMUNICATION

Highest Selling SKU

Dairy Milk - Rs 40
Amul Dark chocolate – Rs 25
Bournville - Rs 40

1.Dairy Milk - Rs 40

Key Reasons For Consumer Buying These

Brands
Taste good
Unique Flavor

# Information Value/Details
i Final retail sales 40
ii Gross Margin 8
iii Retailer Margin (%) ((8/40)* 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (300-60)/2=120
v Service Frequency from Weekly once
Distributor
vi Credit Limit by Distributor ₹10000, within 15 days
vii Return of Damaged Goods Returned while next lot delivery. (high chance, due to
expired products)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
40/100=0.4=40%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 4,60,800 Cost of Good
sold- Rs 3,68,640
Average inventory cost- Rs 23,040
Gross Margin- Rs 4,60,800- Rs 3,68,640 = Rs 92,160
GMROI= 92,160/ 23,040 = 4
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability.
xiii Industry Specific Learning Dairy milk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.

2.Amul Dark Chocolate – Rs 25

Key Reasons For Consumer Buying These

Brands
Premium product for specific taste preference
Affordable in price

# Information Value/Details
i Final retail sales 25
ii Gross Margin 4
iii Retailer Margin (%) ((4/25)* 100= 16%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-30)/2=35
v Service Frequency from Weekly once
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned within a month of complaint.
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
20/100=0.2=20%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 84,000 Cost of Good
sold- Rs 70,560
Average inventory cost- Rs 8,820
Gross Margin- Rs 84,000- Rs 70,560 = Rs 13,440
GMROI= 13,440 / 8,820 = 1.52
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability.
xiii Industry Specific Learning Dark chocolate is helpful for those having diabetes.
 3.Bournville - Rs 40

Key Reasons For Consumer Buying These

Brands
Premium product
Affordable in price

# Information Value/Details
i Final retail sales 40
ii Gross Margin 32
iii Retailer Margin (%) ((8/40)* 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-20)/2=40
v Service Frequency from Weekly once
Distributor
vi Credit Limit by Distributor ₹10000, within 7-10 days
vii Return of Damaged Goods Returned within a month of complaint.
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
20/100=0.2=20%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 1,53,600 Cost of Good
sold- Rs 1,22,880
Average inventory cost- Rs 15,360
Gross Margin- Rs 1,53,600- Rs 1,22,880 = Rs 30,720
GMROI= 30,720 / 15,360 = 2
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like melted products), there is generally
bargaining of schemes and there is sometimes lack
of support and delayed delivery, multi-channel
conflicts like unavailability.
xiii Industry Specific Learning Dark chocolate is helpful for those having diabetes.
 STORE – 9: THE CAKE CAFE

Highest Selling SKU

Five-Star - Rs 30
Dairy Milk – Rs 20
Perk- Rs 5

1.Five-Star - Rs 30
Key Reasons For Consumer Buying These
Brands
Chewy Chocolate
Affordable in price

# Information Value/Details
i Final retail sales 40
ii Gross Margin 32
iii Retailer Margin (%) ((8/40)* 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-20)/2=40
v Service Frequency from twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 7-10 days
vii Return of Damaged Goods Returned while next lot delivery. (high chance, due to
expired products)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
4/32=0.125=12.5%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 15,400 Cost of Good
sold- Rs 7,680
Average inventory cost- Rs 3,000
Gross Margin- Rs 15,400- Rs 7,680 = Rs 7,720
GMROI=7720/3,000 = 2.57
xii Channel conflict examples Demand also challenges the dairy industry due to
the seasonal and fewer number of people who buy
these products. Furthermore, the low supply of
milk is greatly attributed to low produce.
xiii Industry Specific Learning One of the most consumed chocolates all over the
country, consumed specially by youths, innovation in
texture of chocolate will result in greater demand.

2.Dairy Milk – Rs 20

Key Reasons For Consumer Buying These

Brands
Taste good
Affordable in price

# Information Value/Details
i Final retail sales 20
ii Gross Margin 4
iii Retailer Margin (%) ((4/20)* 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (300-100)/2=100
v Service Frequency from twice a month
Distributor
vi Credit Limit by Distributor ₹5000, within 15 days
vii Return of Damaged Goods Returned while next lot delivery. (very low chance)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
6/72=0.083=8.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 48,000 Cost of Good
sold- Rs 38,400
Average inventory cost- Rs 3,000
Gross Margin- Rs 48,000- Rs 38,400 = Rs 9,600
GMROI= 9,600/3,000 = 3.2
xii Channel conflict examples The major problem in the marketing channel is
insufficient supply of local milk producers,
resulting to importation from other provinces. This
results from low trade support and management.
xiii Industry Specific Learning - Dairymilk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.
 3.Perk- Rs 5

Key Reasons For Consumer Buying These

Brands
Chocolate wafer.
Affordable in price

# Information Value/Details
i Final retail sales 5
ii Gross Margin 1
iii Retailer Margin (%) (1/5) *100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (600-200)/2=200
v Service Frequency from twice a month
Distributor
vi Credit Limit by Distributor ₹3000, within 15 days
vii Return of Damaged Goods Returned while next lot delivery. (very low chance)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
30/90=0.333=33.3%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 25,000 Cost of Good
sold- Rs 19,000
Average inventory cost- Rs 3000
Gross Margin- Rs 25000- Rs 19000 = Rs 6000
GMROI= 6000/3000 = 2.00
xii Channel conflict examples Vertical conflict is faced sometimes.In case of
spoilage (like melted products), there is generally
bargaining of schemes
xiii Industry Specific Learning -Merchandisers, responsible for maintaining displays at
distribution points covering 40-50 outlets per week,
however lack motivation, and gauging their
effectiveness is challenging. To address this,
recommend introducing Rs. 400-500 incentives based
on performance
 STORE – 10: THE SCONE CORNER

Highest Selling SKU

Dairy milk - Rs 10
Munch – Rs 10
Five Star- Rs 10

1.Dairy Milk - Rs 10

Key Reasons For Consumer Buying These

Brands
Tastes good
Affordable in price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 1.5
iii Retailer Margin (%) (1.5/10) 100= 15.00%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (150-10)/2=70
v Service Frequency from weekly once
Distributor
vi Credit Limit by Distributor ₹2000, within 7-10 days
vii Return of Damaged Goods Returned while next lot delivery. (very low chance)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
30/60=0.5=50%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 67,200 Cost of Good
sold- Rs 57,120
Average inventory cost- Rs 7,140
Gross Margin- Rs 67200- Rs 57120 = Rs 10,080
GMROI= 10,080/7140 = 1.41
xii Channel conflict examples Vertical conflict is faced sometimes.In case of
spoilage (like melted products), there is generally
bargaining of schemes
xiii Industry Specific Learning Dairy milk is one of the most consumed chocolates all
over the country, consumed specially by youths,
innovation in texture of chocolate will result in greater
demand.

2.Munch – Rs 10

Key Reasons For Consumer Buying These

Brands
Not very chocolaty (mixture of wafers)
Affordable in price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 2
iii Retailer Margin (%) (2/10) 100= 20%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-30)/2=35
v Service Frequency from weekly once
Distributor
vi Credit Limit by Distributor ₹3000, within 10-14 days
vii Return of Damaged Goods Returned while next lot delivery. (very low chance)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
10/60=0.16=16%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 33,600 Cost of Good
sold- Rs 26,880
Average inventory cost- Rs 2,880
Gross Margin- Rs 33,600- Rs 26,880 = Rs 6720
GMROI= 6720 / 2880 = 2.33
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like damaged products), there is
generally bargaining of schemes and there is
sometimes lack of support and delayed delivery,
multi-channel conflicts like unavailability.
xiii Industry Specific Learning It's very safe for the children also, consume. It can be
consumed by all age groups.
 3.Five Star- Rs 10

Key Reasons For Consumer Buying These

Brands
Tastes good
Affordable in price

# Information Value/Details
i Final retail sales 10
ii Gross Margin 1.5
iii Retailer Margin (%) (1.5/10) 100= 15%
iv Average Inventory Levels = (Opening inventory- closing inventory)/2 =
(monthly) (100-20)/2=40
v Service Frequency from weekly once
Distributor
vi Credit Limit by Distributor ₹2000, within 7-10 days
vii Return of Damaged Goods Returned while next lot delivery. (very low chance)
viii Stock Carrying Norms -Ensure visibility
-Review Inventory periodically (removing expired
products)
ix Display Key of Products Facings for brand/ Total facings in the category=
10/60=0.16=16%
x Pricing Economical pricing, fixed MRP
xi GMROI Annual Sales of chocolates – Rs 38,400 Cost of Good
sold- Rs 32,640
Average inventory cost- Rs 2,040
Gross Margin- Rs 38,400- Rs 32,640 = Rs 5,760
GMROI= 5,760 / 2040 = 2.82
xii Channel conflict examples Vertical conflict is faced sometimes. In case of
spoilage (like damaged products), there is
generally bargaining of schemes and there is
sometimes lack of support and delayed delivery,
multi-channel conflicts like unavailability.
xiii Industry Specific Learning five star consist of caramel that can be consumed when
hungry and its very smooth to chew.
 CONCLUSION
This assignment has provided us with valuable insights into the intricacies of retail operations
and transactions intertwined with wholesalers or distributors in the chocolate and confectionery
segment. Throughout the project, we delved into the challenges stores encounter when
navigating relationships with wholesalers or distributors. Our exploration extended to
understanding the holistic channel management system, recognizing how the interactions of
each channel member can significantly impact the entire ecosystem by engaging with other
stakeholders. Furthermore, we gained insights into diverse customer buying behaviors,
recognizing how their actions and purchases distinctly shape product demand, especially within
the realm of chocolate and confectionery.