Competition Benchmarking at ITC LTD

SUMMER TRAINING PROJECT REPORT
ON
Competition Benchmarking at ITC LTD.
Submitted in the partial fulfillment of the degree of
Masters of Business Administration (MBA)
(2012-2014)
SUBMITTED BY:
Varun Bhatnagar
08316603912
Faculty Guide
Sanjeev Mittal
(Professor)
Mentor at the organization

Mr.Karan Sehgal
(Asst. Branch Manager)
SUBMITTED TO:
University School of Management Studies, GGS Indraprastha University,

Sector 16-C, Dwarka, New Delhi 110078
STUDENT DECLARATION
This to certify that I have completed the project titled Competition Benchmarking under the guidance of Sanjeev
Mittal in the partial fulfillment of the requirement for the award of the degree of Master in Business
Administration from University School of Management Studies, New Delhi. This is an original work and I have
not submitted it earlier elsewhere.
CERTIFICATE
This is to certify that the project titled Competition Benchmarking is an academic work done by VARUN
BHATNAGAR submitted in the partial fulfillment of the requirement for the award of the degree of Masters in
Business Administration from University School of Management Studies, New Delhi. under my guidance and
direction. To the best of my knowledge and belief the data and information presented by him in the project has not
been submitted earlier elsewhere.
Sanjeev Mittal
(Project Guide)
USMS
ACKNOWLEDGEMENT
I offer my sincere thanks and humble regards to University School of Management Studies, GGSIPU University,
New Delhi for imparting us very valuable professional training in MBA.

I pay my gratitude and sincere regards to Mr. Romit Rallhan, Branch manager (Sales department) and Karan
Sehgal Asst Branch Manager(Sales Department) my external guides and Professor Sanjeev Mittal, my internal
guide, who has been constant source of inspiration and encouragement to me., my project Guide for giving me the
cream of his knowledge. I am thankful to him as he has been a constant source of advice, motivation and inspiration.
I am also thankful to him for giving his suggestions and encouragement throughout the project work.
I take the opportunity to express my gratitude and thanks to our computer Lab staff and library staff for providing
me opportunity to utilize their resources for the completion of the project.
I am also thankful to my family and friends for constantly motivating me to complete the project and providing me
an environment which enhanced my knowledge
TABLE OF CONTENTS
Student Declaration
Certificate from Guide
i
ii
Acknowledgement..
iii
Page no.
CHAPTER-1: INTRODUCTION
Executive Summary...
1.1 About the Industry
1
2
1.2 About the company
1.2.1 History and Evolution
1.2.2 Vision..
CHAPTER-2: Questionnaires and Overview

2.1 About the Topic
6
2.2 Questionnaires ...
CHAPTER-3: RESEARCH METHODOLOGY
3.1 Purpose of the Study
3.2 Research Objectives of the Study..
3.3 Research Methodology of the study..
3.3.1 Research Design..
3.3.2 Data Collection Technique..
3.3.3 Sample Design
3.3.4 Method of Data Collection..
3.3.4.1 Instrument for Data Collection
3.3.4.2 Drafting of a questionnaire..
3.3.5 Limitations
9
13
13
13
17
18
14
14
14
14
14
CHAPTER-4: ANALYSIS AND INTERPRETATION

4.1 Product Categories
4.2 Route Planning
4.3 Analysis & Interpretation
16
23
25
CHAPTER-5: FINDINGS AND SUGGESTIONS

5.1 Findings..
5.2 Suggestions..
35
37
CHAPTER-6: CONCLUSION
6.1 Conclusion
39
BIBLIOGRAPHY..
ANNEXURE..
40
41
CHAPTER-1: INTRODUCTION
Executive summary
To make a comparative analysis of ITC LTDs Fast Moving Consumer Goods products with that of its close
competitors BRITANNIAs, NESTLEs and FRITO-LAYs respective products to create a benchmark against them
and analyze their product categories, salesmen roles, sales volumes and methods of marketing and distribution by
the means of checking the visibility, availability and quality distribution across the identified target outlets and the
response of salesmen of the companies, and of retailers and distributors about the products of these different
companies.
The project focuses on the strategies used by ITC ltd in selling its FMCG products other than tobacco especially
noodles, biscuits and chips and draws comparison with its rival companies who are already established in the Indian
FMCG sector and giving ITC a run for its money.
Nestle and Frito-Lays being foreign companies have a strong financial as well as distribution base, while Britannia
uses its wide popularity and customer loyalty, thus every company has its USP(Unique selling point) which it uses
up to its best potential and enables ITC to make different strategies to keep a tab on its competitors accordingly.
After drawing comparisons in my survey this project report provides some illicit information from the sales
personnel and distributors of these respective companies, findings and some suggestions that follow, which might
prove to be useful for the company in developing its further strategies.
Indian FMCG Sector

Fast Moving Consumer Goods (FMCG) goods are popularly named as consumer packaged goods. Items
in this category include all consumables (other than groceries/pulses) people buy at regular intervals. The
most common in the list are toilet soaps, detergents, shampoos, toothpaste, shaving products, shoe
polish, packaged foodstuff, and household accessories and extends to certain electronic goods. These
items are meant for daily of frequent consumption and have a high return. The Indian FMCG sector is the
fourth largest sector in the economy with a total market size in excess of US$ 13.1 billion. It has a strong
MNC presence and is characterized by a well established distribution network, intense competition
between the organized and unorganized segments and low operational cost. Availability of key raw
materials, cheaper labor costs and presence across the entire value chain gives India a competitive
advantage. The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015.
Penetration level as well as per capita consumption in most product categories like jams, toothpaste, skin
care, hair wash etc in India is low indicating the untapped market potential. Burgeoning Indian population,
particularly the middle class and the rural segments, presents an opportunity to makers of branded
products to convert consumers to branded products. Growth is also likely to come from consumer
'upgrading' in the matured product categories. With 200 million people expected to shift to processed and
packaged food by 2010, India needs around US$ 28 billion of investment in the food-processing industry.
About the Company
ITC is one of India's foremost private sector companies with a market capitalisation of US $ 45 billion and
a turnover of US $ 7 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the
World's Most Reputable Companies by Forbes magazine and among India's Most Valuable Companies
by Business Today. ITC ranks among India's '10 Most Valuable (Company) Brands', in a study conducted
by Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing
companies compiled by Business Week.
Multiple Drivers of Growth
ITCs aspiration to create enduring value for the nation and its stakeholders is manifest in its robust
portfolio of traditional and greenfield businesses encompassing Fast Moving Consumer Goods
(FMCG), Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, and Information
Technology. This diversified presence in the businesses of tomorrow is powered by a strategy to pursue
multiple drivers of growth based on its proven competencies, enterprise strengths and strong synergies
between its businesses.
The competitiveness of ITCs diverse businesses rest on the strong foundations of institutional strengths
derived from its deep consumer insights, cutting-edge Research & Development, differentiated
product development capacity, brand-building capability, world-class manufacturing
infrastructure, extensive rural linkages, efficient trade marketing and distribution network and
dedicated human resources. ITCs ability to leverage internal synergies residing across its diverse
businesses lends a unique source of competitive advantage to its products and services.
Within a relatively short span of time, ITC has established vital brands like Aashirvaad, Sunfeast, Dark
Fantasy, Delishus, Bingo!, Yippee!, Candyman, mint-o, Kitchens of India in the Branded Foods
space; Essenza Di Wills, Fiama Di Wills, Vivel, Vivel Cell Renew, Engage and Superia in the
Personal Care products segment; Classmate and Paperkraft in Education & Stationery products; Wills
Lifestyle and John Players in the Lifestyle Apparel business; Mangaldeep in Agarbattis and Aim in the
Safety Matches segment. This growth has been rated by a Nielsen Report to be the fastest among the
consumer goods companies operating in India.
Creating Enduring Value
Today ITC is the country's leading FMCG marketer, the clear market leader in the Indian Paperboard and
Packaging industry, a globally acknowledged pioneer in farmer empowerment through its wide-reaching
Agri Business, the second largest Hotel Chain in India and a trailblazer in 'green hoteliering'. ITC Infotech,
a wholly-owned subsidiary, is one of India's fast-growing IT companies in the mid-tier segment. This
portfolio of rapidly growing businesses considerably enhances ITC's capacity to generate growing value
for the Indian economy.
ITC's Agri-Business is one of India's largest exporters of agricultural products. The ITC group's
contribution to foreign exchange earnings over the last ten years amounted to nearly US$ 5.4 billion, of
which agri exports constituted 56%. The Company's 'e-Choupal' initiative has enabled Indian agriculture
significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet.
This transformational strategy has already become the subject matter of a case study at Harvard
Business School apart from receiving widespread global acclaim.
As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly
nation-oriented. Chairman Y C Deveshwar calls this source of inspiration "a commitment beyond the
market". In his own words: "ITC believes that its aspiration to create enduring value for the nation
provides the motive force to sustain growing shareholder value. ITC practices this philosophy by not
only driving each of its businesses towards international competitiveness but by also consciously
contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC group
directly employs more than 31,000 people and the Company's Businesses and their value-chains
generate over 5 million sustainable livelihoods many of whom live at the margin in rural India.
Global Exemplar in Sustainability
Acknowledged as a global exemplar in sustainability, ITC is the only enterprise in the world, of
comparable dimensions to be carbon-positive, water-positive, and solid waste recycling
positive. A testimony to its commitment to a low carbon growth path - over 41 % of the total energy
requirements of ITC is met from renewable sources. All ITC's premium luxury hotels are LEED
(Leadership in Energy and Environmental Design) Platinum certified making it the "greenest luxury hotel
chain" in the world. ITC's Paperboards and Paper business is an icon of environmental stewardship.
ITC's production facilities and hotels have won numerous national and international awards for quality,
productivity, safety and environment management systems. ITC was the first company in India to
voluntarily seek a corporate governance rating.The Company continuously endeavours to enhance its
wealth generating capabilities in a globalising environment to consistently reward more than 4,51,000
shareholders, fulfill the aspirations of its stakeholders and meet societal expectations.
ITC-History and Evolution
ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India Limited. As the
Company's ownership progressively Indianised, the name of the Company was changed from Imperial Tobacco
Company of India Limited to India Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. In
recognition of the Company's multi-business portfolio encompassing a wide range of businesses - Fast Moving
Consumer Goods comprising Foods, Personal Care, Cigarettes and Cigars, Branded Apparel, Education and
Stationery Products, Incense Sticks and Safety Matches, Hotels, Paperboards & Specialty Papers, Packaging, AgriBusiness and Information Technology - the full stops in the Company's name were removed effective September 18,
2001. The Company now stands rechristened 'ITC Limited'.
The Company's beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the
Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land
situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. This decision of
the Company was historic in more ways than one. It was to mark the beginning of a long and eventful journey into
India's future. The Company's headquarter building, 'Virginia House', which came up on that plot of land two years
later, would go on to become one of Kolkata's most venerated landmarks.
Though the first six decades of the Company's existence were primarily devoted to the growth and consolidation of
the Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the beginnings of a corporate transformation
that would usher in momentous changes in the life of the Company.
ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for ITC's Cigarettes
business. It is today India's most sophisticated packaging house.
In 1975, the Company launched its Hotels business with the acquisition of a hotel in Chennai which was
rechristened 'ITC-Welcomgroup Hotel Chola' (now renamed My Fortune, Chennai). The objective of ITC's entry
into the hotels business was rooted in the concept of creating value for the nation. ITC chose the Hotels business for
its potential to earn high levels of foreign exchange, create tourism infrastructure and generate large scale direct and
indirect employment. Since then ITC's Hotels business has grown to occupy a position of leadership, with over 100
owned and managed properties spread across India under four brands namely, ITC Hotels - Luxury Collection,
WelcomHotels, Fortune Hotels and WelcomHeritage.
In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards Limited.
Bhadrachalam Paperboards amalgamated with the Company effective March 13, 2002 and became a Division of the
Company, Bhadrachalam Paperboards Division. In November 2002, this division merged with the Company's
Tribeni Tissues Division to form the Paperboards & Specialty Papers Division. ITC's paperboards' technology,
productivity, quality and manufacturing processes are comparable to the best in the world. It has also made an
immense contribution to the development of Sarapaka, an economically backward area in the state of Andhra
Pradesh. It is directly involved in education, environmental protection and community development. In 2004, ITC
acquired the paperboard manufacturing facility of BILT Industrial Packaging Co. Ltd (BIPCO), near Coimbatore,
Tamil Nadu. The Kovai Unit allows ITC to improve customer service with reduced lead time and a wider product
range.
In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture. In August 2002, Surya
Tobacco became a subsidiary of ITC Limited and its name was changed to Surya Nepal Private Limited (Surya
Nepal). In 2004, the company diversified into manufacturing and exports of garments.
In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing company and a major supplier of
tissue paper to the cigarette industry. The merged entity was named the Tribeni Tissues Division (TTD). To harness
strategic and operational synergies, TTD was merged with the Bhadrachalam Paperboards Division to form
the Paperboards & Specialty Papers Division in November 2002.
Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for export of agricommodities. The Division is today one of India's largest exporters. ITC's unique and now widely acknowledged eChoupal initiative began in 2000 with soya farmers in Madhya Pradesh. Now it extends to 10 states covering over 4
million farmers. Also, through the 'Choupal Pradarshan Khet' initiative, the agri services vertical has been focusing
on improving productivity of crops while deepening relationship with the farming community.
ITC launched line of premium range of notebooks under brand Paperkraft in 2002. To augment its offering and to
reach a wider student population, the Classmate range of notebooks was launched in 2003. Classmate over the
years has grown to become India's largest notebook brand and has also increased its portfolio to occupy a greater
share of the school bag. Years 2007- 2009 saw the launch of Practical Books, Drawing Books, Geometry Boxes,
Pens and Pencils under the 'Classmate' brand. In 2008, ITC positioned the business as the Education and
Stationery Products Business and launched India's first environment friendly premium business paperunder
the 'Paperkraft' Brand. 'Paperkraft' offers a diverse portfolio in the premium executive stationery and office
consumables segment. In 2010, Colour Crew was launched as a new brand of art stationery.
ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality relaxed wear
for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded its range to include Wills
Classic formal wear (2002) and Wills Clublife evening wear (2003). ITC also initiated a foray into the popular
segment with its men's wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title partner of the
country's most premier fashion event - Wills Lifestyle India Fashion Week - that has gained recognition from
buyers and retailers as the single largest B-2-B platform for the Fashion Design industry. To mark the occasion, ITC
launched a special 'Wills Signature', taking the event forward to consumers.
In 2000, ITC spun off its information technology business into a wholly owned subsidiary, ITC Infotech India
Limited, to more aggressively pursue emerging opportunities in this area. Today ITC Infotech is one of India's
fastest growing global IT and IT-enabled services companies and has established itself as a key player in offshore
outsourcing, providing outsourced IT solutions and services to leading global customers across key focus verticals Banking Financial Services & Insurance (BFSI), Consumer Packaged Goods (CPG), Retail, Manufacturing,
Engineering Services, Media & Entertainment, Travel, Hospitality, Life Sciences and Transportation & Logistics.
ITC's foray into the Foods business is an outstanding example of successfully blending multiple internal
competencies to create a new driver of business growth. It began in August 2001 with the introduction of'Kitchens
of India' ready-to-eat Indian gourmet dishes. In 2002, ITC entered the confectionery and staples segments with the
launch of the brands mint-o and Candyman confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the
introduction of Sunfeast as the Company entered the biscuits segment. ITC entered the fast growing branded snacks
category with Bingo! in 2007. In 2010, ITC launched Sunfeast Yippee! to enter the Indian instant noodles market.
In just over a decade, the Foods business has grown to a significant size under seven distinctive brands, with an
enviable distribution reach, a rapidly growing market share and a solid market standing.
In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain found yet
another expression in the Safety Matches initiative. ITC now markets popular safety matches brands like iKno,
Mangaldeep and Aim.
ITC's foray into the marketing of Agarbattis (incense sticks) in 2003 marked the manifestation of its partnership
with the cottage sector. Mangaldeep is a highly established national brand and is available across a range of
fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Sambrani and Nagchampa.
ITC entered the Personal Care Business in 2005. In eight years, the Personal Care portfolio has grown
under'Essenza Di Wills', 'Fiama Di Wills', 'Vivel' and 'Superia' brands which have received encouraging
consumer response and are also being progressively extended nationally. In May 2013, the business expanded its
product portfolio with the launch of Engage one of Indias first range of couple deodorants
In 2010, ITC launched its handrolled cigar, Armenteros, in the Indian market. Armenteros cigars are available
exclusively at tobacco selling outlets in select hotels, fine dining restaurants and exclusive clubs.
Vision
Sustain ITC's position as one of India's most valuable corporations through world class performance,
creating growing value for the Indian economy and the Company's stakeholders
Mission
To enhance the wealth generating capability of the enterprise in a globalizing environment, delivering
superior and sustainable stakeholder value
Chapter-2 : Overview of topic and Questionnaires

2.1 Competition Benchmarking
This report offers a comprehensive overview on the key strategies adopted by these market leaders to gain a stronger
market position in this competitive environment.
It can be best used to derive a framework for strategic planning with key success factors (KSFs) of the industry or
marketplace on specific metrics.
From a strategic decision making perspective, it can be further used to develop future quality and market initiatives
for the company to enhance its overall competitive position.
This is a sort of market analysis done in order to get a comprehensive perspective on product offerings, financial
performance, market/industry position, and business strategies etc of the company in relation to its competitors &
industry segment.
Benchmarking enables us a reference point which acts as a guiding, driving and motivating force to take decisions
regarding the search for industries best practices that will lead to a superior performance , for easy identification of
outlets for products offered by the company and their respective placement into prospective markets.
Placement of products is the utmost important criteria to enhance or acquire the visibility of the product in the eyes
of the customer and for the same every company aims to take an edge over its competitors by infusing creativity in
their branding and promotional activities.
Fast Moving Consumer Goods (FMCG)?
Products which have a quick turnover, and relatively low cost are known as Fast Moving Consumer Goods (FMCG).
FMCG products are those that get replaced within a year. Examples of FMCG generally include a wide range of
frequently purchased consumer products such as toiletries, soap, cosmetics, tooth cleaning products, shaving
products and detergents, as well as other non-durables such as glassware, bulbs, batteries, paper products, and plastic
goods. FMCG may also include pharmaceuticals, consumer electronics, packaged food products, soft drinks, tissue
paper, and chocolate bars.
A subset of FMCGs is Fast Moving Consumer Electronics, which include innovative electronic products such as
mobile phones, MP3 players, digital cameras, GPS Systems and Laptops. These are replaced more frequently than
other electronic products.
White goods in FMCG refer to household electronic items such as Refrigerators, T.Vs, Music Systems, etc.
ITC estimates the Indian FMCG industry at Rs.2.5 lakh crores with a compounded annual growth rate (CAGR) of
17 per cent over the last five years
.
Indian FMCG Sector
The Indian FMCG sector is the fourth largest in the economy and has a market size of US$13.1 billion. Wellestablished distribution networks, as well as intense competition between the organized and unorganized segments
are the characteristics of this sector. FMCG in India has a strong and competitive MNC presence across the entire
value chain. It has been predicted that the FMCG market will reach to US$ 33.4 billion in 2015 from US $ billion
11.6 in 2003. The middle class and the rural segments of the Indian population are the most promising market for
FMCG, and give brand makers the opportunity to convert them to branded products. Most of the product categories
like jams, toothpaste, skin care, shampoos, etc, in India, have low per capita consumption as well as low penetration
level, but the potential for growth is huge.
The Indian Economy is surging ahead by leaps and bounds, keeping pace with rapid urbanization, increased literacy
levels, and rising per capita income.
The big firms are growing bigger and small-time companies are catching up as well. According to the study
conducted by AC Nielsen, 62 of the top 100 brands are owned by MNCs, and the balance by Indian companies.
Fifteen companies own these 62 brands, and 27 of these are owned by Hindustan Lever. Pepsi is at number three
followed by Thums Up. Britannia takes the fifth place, followed by Colgate (6), Nirma (7), Coca-Cola (8) and Parle
(9). These are figures the soft drink and cigarette companies have always shied away from revealing. Personal care,
cigarettes, and soft drinks are the three biggest categories in FMCG. Between them, they account for 35 of the top
100 brands.
THE TOP 10 COMPANIES IN FMCG SECTOR

S. NO.
Companies
1.
Hindustan Unilever Ltd.
2.
ITC (Indian Tobacco Company)
3.
Nestl India
4.
GCMMF (AMUL)
5.
Dabur India
6.
Asian Paints (India)
7.
Cadbury India
8.
Britannia Industries
9.
Procter & Gamble
10.
Marico Industries
The companies mentioned in the table are the leaders in their respective sectors. The personal care category has the
largest number of brands, i.e. 21, inclusive of Lux, Lifebuoy, Fair and Lovely, Vicks, and Ponds. There are 11 HLL
brands in the 21, aggregating Rs. 3,799 crore or 54% of the personal care category. Cigarettes account for 17% of
the top 100 FMCG sales, and just below the personal care category. ITC alone accounts for 60% volume market
share and 70% by value of all filter cigarettes in India.
The foods category in FMCG is gaining popularity with a swing of launches by HLL, ITC, Godrej, and others. This
category has 18 major brands, aggregating Rs. 4,637 crores. Nestle and Amul slug it out in the powders segment.
The food category has also seen innovations like softies in ice creams, chapattis by HLL, ready to eat rice by HLL
and pizzas by both GCMMF and Godrej Pillsbury. This category seems to have faster development than the
stagnating personal care category. Amul , India's largest foods company has a good presence in the food category
with its ice-creams, curd, milk, butter, cheese, and so on. Britannia also ranks in the top 100 FMCG brands,
dominates the biscuits category and has launched a series of products at various prices.
In the household care category (like mosquito repellents), Godrej and Reckitt are two players. Goodknight from
Godrej is worth above Rs 217 crores, followed by Reckitt's Mortein at Rs 149 crore.
An overview at ITCs major competitors in the FMCG sector
Maggi noodles is a brand of instant noodles manufactured by Nestl, Nestl India Ltd (NIL) offered a variety of
culinary products such as instant noodles, soups, sauces and ketchups, cooking aids (seasonings), etc., under the
Maggi brand. Of these, instant noodles had been NIL's main product category in the culinary segment since the
launch of Maggi 2 Minute Noodles (Maggi noodles) in 1982. In fact, the word "Maggi" has become a synonymous
term for any brand of instant noodles in India and Malaysia. Maggi Noodles are available in a large assortment of
different flavours and vary from country to country.
Maggi noodles also produces instant noodles known as "Hot Bowl" noodles named "Cuppa Mania" in India. In
Some countries,new flavors were made on the 25th Anniversary ,Maggi is the toughest competitor that ITC faces in
its noodles product YIPPEE ,though Maggi has a very good reputation and a well established market in our
country ITCS Yippee is able to give a healthy competition due to its innovative shape and marketing tactics plus it
also has a unique flavor.
Frito-Lay is the world's largest manufacturer and distributor of snack foods and is a wholly owned subsidiary of
PepsiCo. Since its entry in India in 1989, PepsiCos snack foods division Frito Lay India (FLI) has become the clear
leader in branded salty snack segment with popular brands like lays, Kurkure, Uncle Chipps Cheetos and Lehar
Namkeens.
Frito Lay India produces its snacks at its state-of-the-art plants in Channo (Punjab), Pune (Maharashtra) and Sankrail
(West Bengal). The company operates over 40 distribution centers that serve more than 2,500 active stockists,
reaching approximately 1 million retail outlets that in turn make the product available at an arms length.
Frito-Lay India Ltd. produces India's largest snack food manufacturers brands, including Ruffles, Hostess, Cheetos
and Uncle Chips. Frito Lay's story is an example of how American recipes were adjusted to satisfy local tastes.
Though ITCs BINGO was launched quite later as compared to Lays which already had a stronghold of the market,
BINGO has given a stiff competition to Lays in recent years, though Lays remains to be on top and most preferred
chips brand in the country but BINGO has still been able to garner a lot of interest and attention from the customers
due to its unique Indian taste plus an interesting set of TV commercials.
Britannia Industries Limited is an Indian food-products corporation based in Kolkata,[2] India. It sells
its Britannia and Tiger brands of biscuit throughout India. Britannia has an estimated 38% market share. [3]
The Company's principal activity is the manufacture and sale of biscuits, bread, rusk, cakes and dairy products.
The company's factories have an annual capacity of 433,000 tonnes.[3] The brand names of biscuits
include VitaMarieGold, Tiger, Nutrichoice Junior,Good day, 50 50, Treat, Pure Magic, Milk Bikis, Good
Morning, Bourbon, Thin Arrowroot, Nice, Little Hearts and many more.Tiger, the mass market brand, realised
$150.75 million in sales including exports to countries including the U.S. and Australia, or 20% of Britannia
revenues in 2006.
Britannia has been adored by the Indian customers for a long time, ITCs Sunfeast has been able to give Britannia
Biscuits a run for their money and pushed them to bring out new and creative biscuits by snatching a significant
market share from them in the Indian Biscuit Industry
2.2 Questionnaires Used

Questionnaire for Direct Sales Executives
Q1. What margin do you offer to retailers (%)____________
Q2. How is market segment classified
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Q3. How many routes are covered in distribution
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Q4. How many product categories are there in fmcg category
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Q5. How the zoning is done (how areas are divided among DSE)
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Q6. What is your role as a salesman
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Q7. What is your salary and what incentives are given to you
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Q8. What are the measures adopted at the distribution point
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Q9. How is the training given to you
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___
Q10. Role of your Supervisor(if any)
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Q11. What strategies are adopted by you to enhance sales (Best practices )
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Q12. What are the hand held devices used in day to day sales tasks
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Q13. What is the coverage norm
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Q14. How do you feel your company values you?
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QUESTIONNAIRE (RETAIL OUTLET)

1) How is the demand of Bingo?
a) Very good ___ b) good ___ c) average ___ d) bad ____
2) Stock availability of various brands
a) Lays _______ b)parle ________ c) Bingo _________
3) What criteria you apply when you sell your product?
a) Focus on Quality_____ b) Focus on Price____ c) Focus on Size______
d) Focus on Margin____
4) How far do you think ITC Bingo has captured market over Lays?
a) On a Small Scale________ b) On a Large Scale________
5) What problem you face to sale ITC Bingo!?
a) Price____ b) Size____ c)Brand Loyalty towards other Brand_____
d) Lack of Awareness_____ e) Any Other______________________
6) Does your sale increased due to Bingo! promotional activities?
a) Highly Increased____ b) Increased____ c) Somewhat Increased____
d) Not at all Increased_____
7) Whether you have to convince customer to purchase Bingo?
a) Yes ___ b) No ___
8) Please assign a value from 1-5 :
To LAYS
5 For Excellent
4 For Very Good
3 For Good
2 For Average
1 For Bad
To BINGO
5 For Excllent
4 For Very Good
3 For Good
2 For Average
1 For Bad
1) How is the demand of Sunfeasts range of biscuits?

a) Sunfeast _______ b)Britannia ______ c) Priyagold ______d) Parle______
e)Duke______
b) Focus on Quality__________ b) Focus on Price_____ c) Focus on Size______
d) Focus on Margin______
4) How far do you think Sunfeast has captured the Indian market over Britannia?
5) What problem you face to sale Sunfeast Biscuits?
1) Lack of Awareness_____ e) Any Other
6) Does your sale increased due to ITC Sunfeasts Promotional activities?
b) Highly Increased____ b) Increased____ c) Somewhat Increased____
7) Whether you have to convince customer to purchase Sunfeast biscuits?
a) Yes ___ b) No ___
8) Please assign a value from 1-5:
To BRITANNIA biscuits
5 For Excellent
4 For Very Good
3 For Good
2 For Average
1 For Bad
To ITC Sunfeast Biscuits

5 For excellent
4 For Very Good
3 For Good
2 For Average
1 For Bad
1) How is the demand of Yippee Noodles?

a) Yippee ______ b)Maggi ______ c) Top Ramen _______d) Foodles_______
c) Focus on Quality_____ b) Focus on Price____ c) Focus on Size______
dFocus on Margin____
4) How far do you think Yippee Noodles has captured market over Maggi?
5) What problem you face to sale Sunfeast Yippee Noodles?
2) Lack of Awareness_____ e) Any Other________________________
6) Does your sale increased due to Yippee noodles Promotional activities?
c) Highly Increased____ b) Increased____ c) Somewhat Increased____
7) Whether you have to convince customer to purchase Yippee Noodles?
a) Yes ___ b) No ___
8) Please assign a value from 1-5 :
To MAGGI
5 For Excellent
4 For Very Good
3 For Good
2 For Average
1 For Bad
To Yippee
5 For Excllent
4 For Very Good
3 For Good
2 For Average
1 For Bad
Chapter-3 Research Methodology

3.1 PURPOSE FOR THE STUDY
To do comparative study of ITCs BINGO,SUNFEAST,YIPPEEs performance in the
market with respect to its direct competitors and analyze their prices, sales and
method of marketing and distribution
To check and achieve visibility, availability and quality distribution across the
identified target outlet and the response of retailer about the product.
.
3.2 OBJECTIVES OF THE STUDY
1. To analyze various types of measures and strategies adopted by ITCs major competitors i.e. Nestle , Frito
lays, Britannia and compare them with that of ITC.
2. To study the performance of the company.
3. To study and analyze how the customers perceive the products of ITC.
3.3 RESEARCH METHODOLOGY OF THE STUDY
The research design is Descriptive as well as Exploratory in nature. The Indian FMCG sector is the fourth largest in
the economy and has a market size of US$13.1 billion. Well-established distribution networks, as well as intense
competition between the organized and unorganized segments are the characteristics of this sector. FMCG in India
has a strong and competitive MNC presence across the entire value chain. It has been predicted that the FMCG
market will reach to US$ 33.4 billion in 2015 from US $ billion 11.6 in 2003. The middle class and the rural
segments of the Indian population are the most promising market for FMCG, and give brand makers the opportunity
to convert them to branded products. Most of the product categories like jams, toothpaste, skin care, shampoos, etc,
in India, have low per capita consumption as well as low penetration level, but the potential for growth is huge. In
midst of these situation it becomes necessary to analyze and find where the company is going with the huge success
of its FMCG products and find its future prospects and study new products viability it tends to launch in the
environment of uncertainty and risks involved with the FMCG sector.
DATA COLLECTION METHODS:
1) Interview with retailers, customers, distributors, and company officials of ITC.
2) Interview with distributors, salesmen and company officials of Frito-Lays,Britannia and Nestle.
3) Questionnaire
i.
For Direct Sales Executives
ii.
For retailers
4) Observations made and inferences drawn during the training period.
5) Secondary data from www.ITCportal.com newspaper, Internet.
3.3.3 SAMPLE DESIGN
SAMPLE SIZE: The sample size is 141 persons.
Sampling Method:Convenience Sampling Technique
Convenience Sampling is the technique in which the researcher just simply picks up the respondents on the basis of
their availability.
3.3.4 Methods of Data Collection:3.3.4.1 Instrument for data collection:

The balance sheet provided by the company to study and analyze financial position of the company and cash flows
statements and cost sheets to study and analyze financial viability of the project Jhansi.
The method of data collection used is SURVEY METHOD with the help of Questionnaire.
3.3.4.2 Drafting of a Questionnaire :
To frame questionnaire or schedule, we have at first to decide regarding various questions to be incorporated. This
decision of the selection of questions depends upon the purpose of enquiry. In this regard, precaution should be
adopted to avoid irrelevant or unnecessary questions.The questionnaire was formulated by keep in mind the
following points:
Giving respondents clear understanding of the questions.

Inducing the respondents to be honest and help to fill in the entire questionnaire.
Giving instructions as to what is wanted.
Identifying needs to be known.
3.3.5 Limitations at last

a
b
c
d
e
f
g
h
i
For performing these king of research large data base is required. The data collected for this study
is not sufficient to analyze the investment pattern of retail investors in India.
There may be many variables which influences the result but this analysis reveals only few
variables.
There can be some deviations in the data as the human psychology changes from time to time.
The feedback we got may not be correct as the respondent might have filled in the information
with no interest or in hurry.
Scientific research on the part of research is also required.
Accuracy level may be effected when data is subjected to weighing.
Time was the biggest constraint as these studies cannot be completed with accuracy in two month.
Understanding the psychology of human is not the cup of every one tea so, might be some
interpretations go wrong.
Some respondents might have taken the question in different sense which can change the data
collected.
CHAPTER-4: ANALYSIS AND INTERPRETATION

Product Categories
Britannia
Following are its various brands in the biscuits segment:
Pure Magic
Treat
Britannia Cookies
Milk Bikis
Tiger
Nutri Choice
Good Day
Time Pass
Bourbon
Little Hearts
50-50
Nice Time
Marie Gold
Rusks
BRITANNIA holds the majority of the biscuit industry of the Indian FMCG sector
Sunfeast by ITC
Sunfeast is the biscuit brand of ITC and was initiated during July 2003. To start with, the brand dealt with glucose,
Marie, and cream biscuits and Following are the major brands of Sunfeast
Sunfeast Milky Magic
Sunfeast Dream Cream
Sunfeast Marie Light
Sunfeast Dark Fantasy
Sunfeast sweet 'n salt
Sunfeast Dark Fantasy Choco Fills
Sunfeast Nice
Sunfeast Glucose
Sunfeast Special-cream and cookies
Britannia and Parle have been one of the major competitors of ITC in the Indian biscuit market in which Britannia
especially enjoys a favorable market share due to the fact that the company was established way back in 1892 and
till today has managed to maintain a distinctive position in the Indian biscuit industry specially with its most popular
brand called Tiger and Good day, Britannia holds a 38% market share in the biscuit industry in India.
Britannia Industries Ltd. its variety of offerings which never fail to create a value for the customer plus Britannia
cakes enjoy a huge monopoly as none of its major competitors have fruit cakes or flavored cakes at their disposal
but Sunfeast currently holds a market share of 10% and is surely becoming a top biscuit brand in India.
Nestle
Nestle is a Swiss company founded in 1986 by Henri Nestle,Basically the company started to meet the need of
the milk in world war I , The Maggi Company merged with Nestle in 1947. Today, Maggi is a leading culinary
brand and part of the NESTLE family of fine foods and beverages. The brand Maggi became so popular in
some East Asian countries and oceania that it is used interchangeably with the products type itself i.e Noodles
,
ITC, for its part, is pleased as a pie of share it has garnered so far, and attributes its No 2 position to factors like
quality , taste preferences and distribution strength and scale.
ITC has done a wonderful job to get a double digit market share which not even Top Ramen was able to
achieve despite its presence in the Indian market since 1988. I think it is because of its good taste, right targeting
and appropriate communication. As of now in the noodles market Nestles major competitor is ITC and it is not the
other way round , as Nestle enjoys a first mover advantage in this market and has a mass appeal in the minds of its
customers.
VS
Frito lay
Fritolay is a North American company which has been running successfully throughout the world under its parent
company PepsiCo. with numerous brands under its belt in context of this project I would like to focus only on
Fritolay brand of PepsiCo. As ITC has been directly competing with the fritolays range of chips in the Indian market
, fritolays the worlds largest and favourite snack food brand, has steadily established itself as an indispensable
part of Indias snacking culture since its launch in 1995., and has been ruling the Indian market with its indisputable
range of potato chips and rice chips i.e Kurkure.
Fritolays direct competition in the Indian market is with ITCs Bingo! which offers a unique Indian taste to cater to
the buds of Indian customers and since its launch in 2007 which marked ITC's foray into the fast growing branded
snack foods segment. Bingos portfolio includes an array of products in both Potato Chips & Finger Snacks
segment. Bingo is positioned as a youthful and innovative snack, offering the consumers with choice in terms of
both formats and flavors.
VS
Flavors in the market
Bingo!
CHIPS
PREMIUM SALTED
JUICY TOMATO KETCHUP
RED CHILLI BIJLI
SPICY MASALA REMIX
INTERNATIONAL CREAM & ONION
BRIDGES MAD ANGLES

CHILLI DHAMAKA
HATKE-JHATKE
FUNKY MASALA
TOMATO MISCHIEF
TOMATO TWIST
TEDHE-MEDHE
Lays
There have been multiple upcoming flavors in market by Fritolay but none has been able to create much hype
around the market as compared to its initial evergreen flavors ,the major range of chips that are giving a tough run to
Bingo! are :
1.American style cream & onion
2. Indias magic masala
3. Spanish tomato tango
4. Classic salted
5. Chile lemon
6. French salt & cracking pepper

7. Lays Baked
COMPETITION AMONG VARIANTS OF
Chips
1. Spicy Masala remix
Chilly Mexicana
2. International cream onion
American cream and onion
3. Juicy tomato ketchup
Spanish tangy tomato
4. Red chili bingo
Magic Masala
5. Premium salted
Classic salted
Bridges
6. Mad angle tomato
Kurkure Dewana tomato
7. Mad angle chili
Kurkure chili chatka
8. Mad angle achari
Kurkure Rajhasthani
9. Hatke-Jhatke Funky
Kurkure Funjabi
10. Hatke-Jhatke Tomato
Kurkure Naughty Tomato
11. Tedhe-Medhe
Kurkure Masala Munch
Comparative Analysis
Best Practices
Every company strives to gain a competitive advantage over its rival companies in the market and for that it opts for
some sort of practices that are unique to it which it uses to have some specific set of activities and tasks, which helps
it to achieve a better position in the market and in the eyes of its customers.
All the major companies that are within the ambit of my project tend to follow some set of practices which areITCs salesmen best practices lie in the skills of the salesmen itself ,for say it depends upon what set of salesmanship
or skills he possesses to lure the retailers to buy or order more of the companys products.
In BRITANNIA a salesman whom I was able to interact with was trying to instigate the retailer to convince him to
order a bigger volume of BRITANNIA biscuits which was looking kind of a desperate attempt just to meet his sales
target.
Albeit BRITANNIA has been the biggest market player in the Indian market when it comes to the biscuit industry
still its salesmen have to infuse a specific set of skill and logic to lure the retailer.
It is always the skill of the salesman that is at the floor level coming into effect i.e. whatever practice a company
intends to imply at the end it is going to be implied by the salesman only.
The NESTLE salesman worked on the pre laid set of practices of the company that were to offer higher margin to
retailers ,offering discounts on 6*100 and 8*100 pack Maggi Noodles .
A notable thing about NESTLES Maggi was that NESTLE has been able to keep a real tab on the market in India
and abroad as well ,it knows what kind of variants customers are actually liking and which kinds are not being
received well ,the credit for this may go to its well placed resources ,market analysis or an efficient customer
feedback system in which they are able to receive customers reviews and are equally able to deal with the particular
variants like or dislike and just straightaway makes the required changes as per the wish of the customers.
Theyve made Maggi actually available everywhere in India whether it be rural area, semi urban and even in hilly
areas, if one goes to a hill station one might not be able to get yippee noodles there but one can get Maggi ,this is the
demand or say charm of maggi that NESTLE has been able to create by excellent distribution system.
On the other hand a FRITO-LAYS salesman works on the principle of giving offers and discounts to the retailers to
lure them. It is also pre laid by the company to ensure that the retailers dont remain unhappy or dissatisfied with
their business interaction with the company.
FRITO-LAYSs strategy is like trial and error method which is very much like ITC in context of launching new
variants in the finger and snacks industry, every 6 months FRITO-LAYS' comes up with some new variant of either
Lays, Kurkure, Uncle Chips or Cheetos and then tests the market response by conducting sales surveys and through
general market response and are thus able to keep a tap and track of the demand, taste & preferences of the
customers. Frito-Lays uses pre sale or order booking process for taking order in urban areas and uses ready stock
process for rural or deep up country
FRITO-LAYSs has been able to enjoy a first mover advantage in India and hence is reaping its full advantage over
ITC ,but ITC has still been to give a tough competition to FRITO-LAYS through its BIGNO! Range of chips and
ITCs best practices are also similar to that of former but ITCs main strategy in BINGO! Is excessive and creative
advertising along with that a unique (both name and taste wise) range of chips it is offering since its inception.
Every company tries to lure its retailer and distributor by offering some sort of margin or discounts or give offers.
Hand Held Devices
The hand held devices possessed by the salesman of all 3 rival companies are as follows along with ITCsCompany
Device
ITC
Samsung Galaxy Ace
BRITANNIA
Pidion bip-6000 series
NESTLE
Samsung Galaxy Pop
FRITO-LAYS
Samsung Star
This hand held device is an actual mobile phone given by the company to its salesmen in which all information
related to products is stored in.
Order which is taken by the machine sinks to the data to branch office. WD system operator makes the invoice and
sends goods to market next day, till my initial days of internship an ITC salesman was using a register to store order
given by the retailer as the previously held hand held device was becoming outdated and used to store the orders
manually but after a while they were provided with Samsung galaxy ace which is a high end phone in which a
software i.e. an application NPR7 is stored which does all the storing and sending of order details to the WD system.
The same functioning is done by the devices mentioned against other 3 companies.
Hand held devices are available to all these companies salesmen is due to the reason that it saves a lot of time and
effort of the salesman and thus benefits the company.
ITC uses software that is called SIFY at the WD, all the bills and detailed information product wise, variant wise,
summarized sales reports are made with the help of this application software.
Margin Structure
Margin structure refers to margin offered to the retailer and distributors by the Company in order to attract further
product orders independent of the demand of the product in a particular market.
Every company offer some margin to its distributors so as to provide them a profitable income as against the
distribution activities performed by them ,a distributors margin is of utmost importance to the distributor as it is
indicative of the main profit a distributor will earn from selling the companys products which is the least profit he
can earn.
On the other hand a retailers margin is given to a retailer by the company in case he orders more of a companys
products for say ,if one orders 2 cartons of Sunfeast Yippee noodles having 12 packets each hell be eligible to get a
certain amount of margin just like a discount as hes purchasing in bulk ,larger the order higher will be the margin
and vice versa ,but theres always a minimum %age of margin given to the retailers by the company irrespective of
the order made by him. As we all know that the order made by the retailer depends largely upon the demand of any
product in the market, whether already prevalent or anticipated in future.
This table gives a look about the margin structure of all 4 companies in terms of percentage Company
Margin to Distributors
Margin to Retailers in %
ITC
BRITANNIA
NESTLE
FRITO-LAYS
in %
5.8
5.9
Around 5.8
5.5
Glu
cos
e
M
ar
ie
10
1
0
Co
oki
es
and
mi
d
pri
ce
Cre
am
12
No
odl
es
Bi
ng
o
Pre
miu
m
Cre
am
12
10
10
9-10
10(approx)
As we can see from the table theres a very close gap or even none between the margin structure of these 4 majors,
ITC is providing 5.8% margin profit to its distributors and it is the same for NESTLE while BRITANNIA is
providing a little bit higher %age margin i.e. 5.9 to its distributors whereas FRITO-LAYS is providing a bit lower
margin as compared to its competitor ITC.
When we see at the retailer margin we can see that all these companies are closely matching with each other , ITC
and BRITANNIA are following the same margin structure in their bi(Biscuit) products while NESTLE is providing
less than 10% margin to the retailers while ITC is providing 10 % and FRITO-LAYS is providing same margin as of
ITC.
This shows that a standard margin structure is being provided by these competitors of ITC in all their respective
products.
Training of Salesmen
Training forms the core of sales personals knowledge of his field; it gives an actual understanding of the work he
has to do when working as salesmen of any given company.
The mode of training given to the salesmen is almost the same in all the 4 companies; they might vary with each
other, which are mentioned here underIn ITC a salesmen is given on the field training which is like training the sales personal while working on the actual
job front in real job like situations. In such training the sales personal is accompanied by a senior salesman and thus
he follows the seniors beats and learns the way how the work is done.
Along with this he is involved in sales meetings which are conducted by sales officers to analyze the market
conditions based on their and salesmens observations and the new salesmen thus learns what the market conditions
are ,how they are observed ,how he shall try to increase sales and hes also welcomed to give any suggestions to his
counterparts.
Classroom training is also given to the new salesmen as well as the old so as they can theoretically relate to the ifs
and buts of the sales function and have a firm grip of the laid down functions he is expected to perform as a
salesman of ITC.
In BRITANNIA is very much similar to ITC but it differs a bit as their training also include the training of how to
use the hand held devices by a specialist Mr.Chandra with whom I had a handshake and a slight conversation with,
that are given to them, they are given product booklet for product information so as they know about the products
that they are selling, along with this they are also given on the job training.
In NESTLE the salesmen are given three types training which includes1. On the job training(OJT)
2. Classroom Training and
3. Sessions training.
The first being implicit OJT is found to be prevalent in most of the organizations involving sales force ,while the
second type of training is implicit from ITCs model as it includes training of sales force by specialists ,senior
salesmen and sales officers.
In FRITO-LAYS a very similar kind of training is being provided to its sales force as I didnt find any difference in
their training program from that of ITC ,they also conduct sales meets to discuss the present market situations
,problems that are persisting ,how to increase sales and deal with retailer problems.
Role of Salesmen
Process
Route and Beat plan
1. To receive sales order on previous day and then to make the supply of products on
the next day by transportation, for this the DSE collects the order from the retailer
2. Sales person visit a particular area on weekly basis.
3. Basically, main outlets are visited twice a week.
4. Nearly 30 stores are visited daily from Monday to Saturday by the companys DSE on
their
personal vehicles.
5. Salesmen assembles at a distribution point, collect a printed invoice of the bill which the SIFY system has
generated as per the purchases made by the retailers, the DSE collects such invoices from the distribution point head
to the planned area of the market they are zoned into and perform two functionsi.
Bill clearance-the DSE makes clearance of the retailers bill by showing
them their respective invoices which contains an itemized record of
their last one weeks purchases and asks them to make payment
against the same.
ii.
After the bill is cleared he asks the retailer for further orders, which
the retailer duly makes as per his/her outlets requirement and the
current demand of the product.
i.
ii.
iii.
6. In case any retailer complaints or creates a problem likeDefaults in making the payment against his/her bill.
Complaints about the shortage in supply or irregular supply of products.
Communicates about any customers grievance related to ITCs product.
The DSE has to handle such problems to their best and communicate such problems
to their supervisors and area executives.
7. To offer special schemes and offers to the retailers like informing them about special displays of products like
personal care and biscuits and paying them for keeping such displays.
8. Keeping them contended by providing margins.
A FRITOLAY DSE performs a bit different role along with performing the aforementioned roles, the DSE arranges
the packets of Lays chips that are kept on the rack at retailers outlet, he wipes off any dust that is laying on the
packet of lays chips and arranges the packets after discussing its demand with the retailer.
The same system is followed by other 3 companies respective DSEs, its not like cutting short the task of providing
a distinguished detail of the role of a DSE in BRITANNIA, NESTLE and FRITO-LAY, the role performed by each
companies DSE was exactly the same to that of ITCs.
Salary and incentives
Salary acts as the most significant source of motivation as it forms the most basic reason for which any DSE joins a
company.
While incentives play a very significant role in providing additional motivation to the executives whether working at
a senior level or working at the ground level i.e. a DSE .
An optimum salary amount and Incentives encourages a sales personal in achieving their sales objectives, in
addition it prevents any loss of morale due to dissatisfaction among the staff if the level of salary or the share of
incentives is low.
After my interaction with the DSE of all these 4 companies, this is the prevailing salary structure of the direct sales
executivesCOMPANY
ITC
BRITANNIA
NESTLE
FRITO-LAY
SALARY
8000-8500*
6500-8000*
7500-8000*
9000
INCENTIVES
2000-4000 or more
1500-6000
4000
3000-4000
*-for senior salesmen
Salaries in all the companies is found to be very similar to each other, while it was found to be a bit lower in
BRITANNIA and NESTLE. ITCs DSE are being paid a good amount as compared to the former two whereas a
FRITOLAY salesmen is getting around 9000 the highest among the lot, a senior salesmen is getting a bit higher
salary then the junior salesmen.
The incentives are paid entirely on the basis of the sales targets achieved by the DSE.
The DSEs are given a fixed target which is corresponding to the actual sales made by them to the retailers, if they
are able to attract more sales due to their sheer skills, relations with retailers and effective communication and
negotiative abilities.
Segmentation Classification
Segment classification refers to the classification of the various segments of the market, in which segment refers to
the class of the population that comprises of the very customers.
Companies target the segments on the basis of their :
1. Taste and preferences of the customers
2. Income of the people
3. Demand of the products
4. Cost of manufacturing of products
5. Cost incurred in the distribution of products
Market segments are considered as the basis for segment classification
Biscuits
ITC
Focus is on the premium segment of the
market, but steadily targeting the middle or
lower income group
BRITANNIA
Focus is more on the middle and lower
income group, and is certainly in a good hold
of the biscuit market in the country
Noodles
ITC
Focus is on kids, the junior segment of the
society
NESTLE
Focus is decentralized as everyone relates to
Maggi very comfortably
Chips
ITC
Theres a decentralized segmentation of the
market, but as the name suggests kids relate
to BINGO! Very easily
FRITO-LAY
Focus is on the high-middle income group,
Lays and kurkure tend to focus on all age
groups while cheetos is directed more
towards children of 7-14 age groups
Zoning
Zoning refers to the distribution of the areas in the market which are assigned respectively to the DSEs of different
companies.
The distribution of the area for each salesman is done on the basis of :
ITC
BRITANNIA
NESTLE
FRITO-LAY
His seniority and existing
His knowledge about any
His place of residence,
His communication skills
knowledge of the actual
particular area, as if a
depending upon his
and his existing relations
field work, it helps in
person is well aware and
geographical proximity to
with the retailers.
zoning because a salesman informed about a
the market in which he has
who is senior(has been
particular area and is
to work in.
working in the same field
willing to use his own
for more then 5 years) is
knowledge base to cover
considered to be an
more outlets.
essential component of the
sales force and thus is
assigned an area in which
he will best fit into
Measures at distribution point
ITC has various distributors as per area/regions who follow the chain of transferring the products to their clients.
These distributors are independent proprietors/ partners who are the mediators between the company and the
customer. Apart from the basic relation of a mediator, the distributor plays a very important role as it passes
consistent raw information as to which product is performing in the market. Following are the important functions
followed by distributors:
Order taking process
The order taking process starts from the customer point from where a Purchase Order (P.O.) is sent directly to the
distributor of ITC via salesman. Further, the P.O. is manually transferred into an Order Booking Report by the
accounts head, further it's classified as per the availability of the products and then Load Slip is prepared. The Load
slip is send to the stores head that dispatches the products as per specification and order.
Delivery process
The Delivery process starts after the goods are been loaded in trucks and are ready to move towards clients' stores.
One copy of received P.O. is taken along with original and duplicate copies for reference. At the clients store the
foods need to be arranged as per the P.O., which is inspected by an official with the help of the Good Inspection
Note (G.I.N.). Further after the inspection the official sings on the duplicate copy and provides a Goods Receipt
Note (G.R.N), which is filed for reference and proof.
Comparison
The measures adopted are one and the same in all the companies, these measures are found to be common among
most companies because these are the tried and tested measures which are the minimum requirement for prudent
distribution of FMCG products in which respective companies deal with for referenceIn Britannia the distributor I conversed with said its all common among all the companies i.e. to ensure that all the
goods that are required to be delivered are made available to the retailers as soon as possible ,while a FRITO-LAYS
distributor asked me to go and survey not only the FMCG sector but any other sector and youll find that the
measures adopted are one and the same in every distribution point and same goes for Nestle whose distributor asked
that we try to cope with the demand and supply equilibrium as best we can and tend to provide the demanded
products to our retailers.
Role of supervisor (if any)

A supervisor is any monitor or guide that is an employee of the company and supervises the activities and
performances of its junior employees in order to guide them and direct their efforts towards a common goal of the
organization.
In ITC Ltd. Theres a supervisor who looks over all the activities related to sales and sales force which are1. To handle the grievances of the retailers.
2. To handle the grievances of ITCs salesmen.
3. To help train the direct sales executives i.e. salesmen so as they can learn about their
work.
4. To keep a regular tab on the actual market scene by making weekly visits to the
market along with the direct sales executives to see whether they are doing the job
well or not and also giving certain inputs to them about to tackle with retailer
grievances.
5. To handle the default making retailers and reporting to respective area executives
about such defaults so as the required action is taken.
While these are the roles a supervisor performs in ITC there are very few
discrepancies between ITCs supervisor with that of BRITANNIAs Performance
Coach, which according to my research was almost the same to that of ITCs
Supervisor but the extra role a performance coach undertakes is that he is more
involved in the training of the direct sales executives as compared to a supervisor.
The performance coach which is an employee of the company is required to conduct
the skill training program designed by BRITANNIAs sales department .the coach
observes the performances of the direct sales executives and makes note of it and
then gives various suggestions and inputs to help the executives in increasing their
sales, better customer and retailer handling, dealing with retailers diligently.
In NESTLE theres a Sales Officer who acts as a supervisor of the direct sales
executives. The sales officer is required to1. Conduct the sales meetings
2. Set sales targets for the direct sales executives
3. He is the carrier of all sales plans of the company and is expected to
communicate them with the entire sales force.
In FRITO-LAY theres a Team Leader who is in-charge of all the sales tasks of ground level and
administrative level as well to some extent, the supervisor has to1. Provide the detailed information about the products to the direct sales executives.
2. Check the current stock availability of the stock at the Stock Keeping Units
(SKUs).
3. To determine the responses that new flavors are having in the market through
DSEs.
Rest of the role a team leader or a sales officer has to perform are almost similar
to that of ITCs supervisor.
Coverage norm
The Outlet coverage norm means how much portion of a market in context of outlets is to be covered by the
company, which is indicative of its pre laid strategy to cover as much possible area of a market to have a bigger
market share.
In BRITANNIA coverage norm has been very rigorous as they tend to cover 6 routes in a week, enabling them to
cover a wider market as compared to ITC .A BRITANNIA salesmen covers top 60% outlets that constitute around
90% of their sales on a priority basis and then cover the balance outlets.
In NESTLE the directive of the sales force is to provide Maggi to every single outlet in their area of operation,
Maggi is being distributed to a General Store in a posh area as well as to some tea stall owners who are having a
higher demand of the noodles while yippee noodles has not yet been able to reach such a high.
In FRITO-LAY too norm is to cover every single possible outlet wherever theres a possibility of a sale, thus, one
can find lays chips in every nook and corner even at some pan shops.
ITC on the other hand has a differentiated strategy for different products for say in case of sunfeast Choco fills and
newbie Delishus range of biscuits which are directed towards premium market segment, are definitely being made
available at retail stores located in posh areas or wherever theres a specific demand for them while in case of other
range of Sunfeast biscuits are being made available at every possible retail store whether in premium class or rest
normal class.
ITC salesmen might visit its premium channels i.e. outlets even twice a week, the premium channel may constitute
to top 85% outlets which have shown some definite sales and cover the balance channel by visiting once in a week,
in case of BRITANNIA too the premium channels might be visited twice only if theres a huge demand for its
biscuits and the outlets need another visit.
CHAPTER-5: FINDINGS AND SUGGESTIONS

Findings
BINGO!
1.
ITCs BINGO! Which was introduced much later in market than its rival FRITO-LAYS Lays and Kurkure
has garnered a tremendous response in the market and is able to give a tough challenge to Lays and other
chips manufacturing companies.
2. In the duration of my project I use to visit the market daily with DS (distributor salesmen) and
analyze the market of ITC Bingo and Frito-Lays. ITC provide 2% extra margin to retailer as compare to its
competitor Frito-Lays.
While checking availability and visibility of Bingo snacks at Retail Outlets I came across following observations:
1) ITC has a good mix of traditional and modern type of distribution channel.
2) The response of customer towards Bingo is positive.
3) At some outlets the sale was very good.
4) Offer packs or consumer offer packs mostly gets sold.
5) The total coverage of ITC Bingo snacks is falling short in comparison to Frito-Lays in some areas but
overall BINGO! is covering a large share of market.
6) Sometimes there was a demand but no supply of requisite chips or bridges by ITC which was a rare sight
for me.
After my observations Ive made this estimate to represent the market share of ITCs BINGO! And
FRITO-LAYS Lays Chips
Market share
LAYS
BINGO(both Chips and Bridges)
71 %
29 %
YIPPEE noodles
1.
Hats off to the branding and research team of Yippee noodles for such a good positioning for its noodles
brand ,these are not my words but the actual words of many retailers I came across .
2.
But still, I feel a lot has to be done for Yippee, the biggest advantage for brands like Maggie is its taste
and first mover advantage in the instant noodle market. The brand Maggie is now becoming generic for the
category and mere advertising is not going to do any harm to Maggi.
3.
Yippee noodles are being purchased by kids of age between 5-10 as they find its cover (wrapper) very
attractive and scores as a selling point for the product.
People tend more to purchase Yippee noodles when they feel bored of Maggi or Top Ramen and want are
looking for a change.
4.
5.
Yippee is perceived with a positive and favorable image as it is a product of a reputed company like ITC
and hence sometimes enjoy some market share due to this fact.
6.
A lot of noodles products have been launched in the Indian market like Nissins Top Ramen, Horlicks
(GSK) Foodles but they are not able to give Maggi a tough fight except than Yippee noodles, Top Ramen
has been in the market from more than 2 decades but still is not able to capture a market share as much as
Yippee noodles has acquired in 3 odd years.
But the key to success for Yippee noodles will be the taste (trials) and targeted promotional activities and good
distribution (A key element since I believe some purchases for Maggie are not planned and Yippee noodles acts as a
substitute for Maggi in many cases)
Sunfeast Biscuits
1.
ITC has a very distribution network due to its cigarette brands and it is using that network to increase the
sales and distribution of its range of biscuits.
2.
The pricing of the company is such that it caters to the need of all income groups of people but special
provision has been kept for Low and middle income group, and their pricing are competitive with respect to
other players like Britannia, Parle.
3.
A tremendously successful source of the Sunfeast biscuits is its innovative advertising which includes Sunfeast school programme: cover 1000 schools across country, to familiarize childrens with sunfeast
brand name and sunfeast mascot, brand ambassadors- shahrukh khan & surya (south actor), Official
sponsor of WTA tennis championship-sunfeast open.
4.
There is Two method of Pricing, which is :

-Low Margin
-Two-Pronged Strategy
Essentially, Parle plays a high volume, low margin game.
But Sunfeast look at a two-pronged strategy, High margins in cream variants and volumes from
the Marie and Glucose segments. For instance, cream biscuits from both Sunfeast cost Rs10 for
100 grams.
Parle, however, only charges Rs 5 for its cream variants, except for Hide & Seek, all of Parle
'products lie in the price range between Rs 4 and Rs 6for 100 gram packs.
Company
BRITANNIA
Type
Digestive for
lifestyle
Pricing Strategy
High margin in
cream, volume
Parle
Regular Glucose
High value, low

margin
Promotional Strategy
Best of brand
ambassadors, mass
campaigns
Health conscious
promotion
Distribution Strategy
Excellent
distribution
Extremely
widespread
distribution
Sunfeast-ITC
5.
Premium Variety
High margin in
cream, volume from
marie & glucose
Largest spender on
ads & promotional
i.e. 35-40% of its
turnover on
marketing
Existing distribution
model and network
of tobacco products
Sunfeast biscuits are in a league of their own, they have created a certain market share territory which is not
interfered or disturbed by any competitor, leading to development of niche market for its premium classs
biscuits like dark fantasy and dark fantasy choco fills.
Heres a look at the Market share of the Biscuit industrys distribution in the Indian market
10%
SUNFEST
BRITANIA
35%
PRIYA GOLD
31%
PARLE-G
9%
14%
All these findings are derived fromWork at retail outlets:

1) To check the availability of products.
2) To check visibility of products.
3) SWOT analysis of products.
4) To check how old the product is in the market.
OTHERS
5) To trace the complaints regarding the product.

6) Identifying what could be the factor that can increase sales.
A FRITO-LAY salesmen with whom I interacted with said that I was previously employed by ITC and was not
feeling contended with its work environment and thats why I switched over to FRITO-LAY, where I feel Im being
appraised quite well, well it was a rare case for me because except him everyone I came across while my survey no
one was found critical of the company ITC but instead were found appreciating and contend with the work
environment and performance appraisals.
SUGGESTIONS
Bingo!
1) There is vast distribution gap between ITC Bingo snacks and Frito-Lays which has to be filled up in order
to increase the sales for that ITC should consider:
(a) Width of Distribution: total number of outlets covered should be increase in order to bridge the
distribution gap. For that ITC should
(b) Increase the number of DS.
(c) Ready Stock: there are many areas around the city where supply through loading auto is not possible for
that ready-stock should be made available.
2) We can introduce new schemes for WholesalersA Wholesaler is totally interested in margin or demand which has high demand
in the market. At
present ITC Bingo is in its growing stage if we provide comparatively high margin to wholesaler then it
will influence the sale.
3)
We can introduce new consumer offer packs.
4)
To some of the posh areas which hesitate to switch to other brands like BINGO! we can provide free
sample of BINGO! so that the people get aware of the product taste and quality so as they dont feel they
are being disloyal to their brand as theyll start getting familiar with BINGO!
5) ITC shall never hesitate to reduce the scale of advertising as FRITO-LAY is never planning to reduce its
scale of advertisements in near future ,as advertising forms a very significant contributor in the increasing
sales and market share of BINGO!
Yippee noodles
1. Though yippee noodles have managed to generate a lot of hype in the market
but it still needs to work more on the distribution network as it is not available
on a very large scale in the market especially rural market.
2. Maggi has been doing the basic thing from the beginning which no other
noodles making company has been doing, Maggi never compromises on the
taste, its main focus is on the actual taste of the product rather than its
packaging, Yipee has to learn this from Maggi that taste is the winner at the
very end.
3. ITC shall not confuse the customers by increasing the inventory of variants in
yipee as customers are not evenly familiar with yipee noodles basic taste and
at the same time they are getting confused by the newly launched flavors of
yipee and as it helps none.
4. ITC shall focus on improving the taste of the tastemaker that is placed in the
packing of noodles and is an essential ingredient of the product.
Sunfeast Biscuits
1. The bi product of sunfeast-ITC is gaining market share and showing great
sales in recent times but still people tend to prefer Parle or Britannia over
sunfeasts basic biscuits like marie, glucose as marie(BRITANNIA) and
glucose(Parle-G) have been in the picture from a very long time, thus
focus on improving these two biscuit variants taste and advertising shall
be upped seriously.
2. ITC shall focus on its premium class biscuits like choco fills and dark
fantasy as they have secured a special place in the eyes of the customer
due to its good taste and a royal feel attached to it thanks to its
advertisements and packaging.
3. Sunfeasts special cookie biscuit is not able to give a tough fight to
BRITANNIAs Good day biscuit which not only dominates the market but
has a market of around rs1200 crores alone in the market courtesy
BRITANNIAs area executive, thus ITC shall try to help its product by
focusing on its taste, packing and pricing it a bit low than good day biscuit
to make it a perfect substitute of good day.
Apart from my designated products I would like to mention a fact which I
have observed from various retailers that ITCs personal care product
Fiama di wills soap has not been generating much demand and revenue
for the retailers due to a common complaint theyve been receiving from
the customers i.e. it is not able to create much lather and people are
finding this very awful and hence causing a damage to companys
reputation, this problem shall be rectified as soon as possible.
Chapter-6 : Conclusion
CONCLUSION:
After survey at retail outlet and doing a comparative analysis I found a contradiction that
1) Lays has been around for a longer time and has its loyalists. Lays scores on flavor while Bingo is crunchier.
Right now Lays has the upper hand but Bingo has a good thing going with new and innovative products
like 'Mad Angles'.
2) There is a need to put the image of our product Bingo in the mind of customers before they come to
purchase at shop.
3) ITCs Sunfeast has a bright future, it is well placed in the market and is going strong in developing a niche
market for itself
4) Sunfeast is coming with unique flavors of biscuits and that is providing it a competitive edge.
5) ITCs Yippee also has a bright future and is able to attract the younger customers plus offers a unique shape
and taste
So from above points and according to my other observation SWOT analysis of products is:
Strength: - A good sales force is the strong point of ITC.
Weakness Some products are new and not able to match the already established alternative products
Opportunity - The unique flavors and advertisements provides ITC a great opportunity to the company
Threats Britannia, Nestle, Frito lays are already very well established and are constantly posing threat to ITCs
products
Bibliography
1. www.Itcportal.com
2. www.google.com
3. www.itcinfotech.com
4. www.itcindia.com
5.
6.
7.
8.
9.
www.slideshare.com
Research Methodology Mr. Romit Ralan(ITC)
Retail Management Mr. Arvind Kumar Sharma(ITC)
Supply chain management Mr. Arvind Kumar Sharma(ITC)
www.wikipedia.org

Competition Benchmarking at ITC LTD

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SUMMER TRAINING PROJECT REPORT

Mentor at the organization

University School of Management Studies, GGS Indraprastha University,

New Delhi for imparting us very valuable professional training in MBA.

1.2 About the company

1.2.1 History and Evolution

CHAPTER-2: Questionnaires and Overview

CHAPTER-4: ANALYSIS AND INTERPRETATION

CHAPTER-5: FINDINGS AND SUGGESTIONS

Indian FMCG Sector

About the Company

ITC-History and Evolution

Chapter-2 : Overview of topic and Questionnaires

THE TOP 10 COMPANIES IN FMCG SECTOR

Hindustan Unilever Ltd.

ITC (Indian Tobacco Company)

Asian Paints (India)

Procter & Gamble

2.2 Questionnaires Used

QUESTIONNAIRE (RETAIL OUTLET)

QUESTIONNAIRE (RETAIL OUTLET)

1) How is the demand of Sunfeasts range of biscuits?

To ITC Sunfeast Biscuits

QUESTIONNAIRE (RETAIL OUTLET)

1) How is the demand of Yippee Noodles?

Chapter-3 Research Methodology

3.3.4 Methods of Data Collection:3.3.4.1 Instrument for data collection:

3.3.4.2 Drafting of a Questionnaire :

Giving respondents clear understanding of the questions.

3.3.5 Limitations at last

CHAPTER-4: ANALYSIS AND INTERPRETATION

Sunfeast Milky Magic

Sunfeast Dream Cream

Sunfeast Marie Light

Sunfeast Dark Fantasy

Sunfeast sweet 'n salt

Sunfeast Dark Fantasy Choco Fills

Sunfeast Special-cream and cookies

JUICY TOMATO KETCHUP

RED CHILLI BIJLI

SPICY MASALA REMIX

INTERNATIONAL CREAM & ONION

BRIDGES MAD ANGLES

2. Indias magic masala

3. Spanish tomato tango

6. French salt & cracking pepper

COMPETITION AMONG VARIANTS OF

2. International cream onion

American cream and onion

3. Juicy tomato ketchup

Spanish tangy tomato

4. Red chili bingo

Kurkure Dewana tomato

7. Mad angle chili

Kurkure chili chatka

8. Mad angle achari

10. Hatke-Jhatke Tomato

Kurkure Naughty Tomato

Kurkure Masala Munch

Role of supervisor (if any)

CHAPTER-5: FINDINGS AND SUGGESTIONS

There is Two method of Pricing, which is :

Essentially, Parle plays a high volume, low margin game.