VV

Sales and Distribution

Team Members:

Ayush Manan 13DM049

Surinder singh 13DM197

Sumit Rekhi 13DM195

Tushar Mittal 13DM205

Udit Jain 13DM206

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Table of Content

S.No Index Page Number

1. COMPANY OVERVIEW 3-4

2. PRODUCT PORTFOLIO 4

3. MARKET CLASSIFICATION

6

4. ORGANIZATION STRUCTURE

7

5. SALES ORGANIZATION STRUCTURE

8

6. RECRUITMENT AND SELECTION

9

7. FORECASTING

10

8. DISTRIBUTION STRUCTURE

12

9. LOGISTICS

15

10. FLOW OF THE PRODUCT

16

11. FINANCIALS

17

12. LEARNINGS and RECOMMENDATIONS

18

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COMPANY OVERVIEW

The Coca-Cola Company re-entered India through its wholly owned subsidiary,

Coca-Cola India Private Limited and re-launched Coca-Cola in 1993 after the

opening up of the Indian economy to foreign investments in 1991. Since then its

operations have grown rapidly through a model that supports bottling operations,

both company owned as well as locally owned and includes over 7,000 Indian

distributors and more than 2.2 million retailers.

Today, their brands are the leading brands in most beverage segments. The Coca-

Cola Company's brands in India include Coca-Cola, Fanta Orange, Limca, Sprite,

Thums Up, Burn, Kinley, Maaza, Minute Maid Pulpy Orange, Minute Maid Nimbu

Fresh and the Georgia Gold range of teas and coffees and Vitingo (a beverage

fortified with micro-nutrients).

In India, the Coca-Cola system comprises of a wholly owned subsidiary of The Coca-

Cola Company namely Coca-Cola India Pvt Ltd which manufactures and sells

concentrate and beverage bases and powdered beverage mixes, a Company-owned

bottling entity, namely, Hindustan Coca-Cola Beverages Pvt Ltd; thirteen licensed

bottling partners of The Coca-Cola Company, who are authorized to prepare,

package, sell and distribute beverages under certain specified trademarks of The

Coca-Cola Company; and an extensive distribution system comprising of our

customers, distributors and retailers. Coca-Cola India Private Limited sells

concentrate and beverage bases to authorized bottlers who are authorized to use

these to produce our portfolio of beverages. These authorized bottlers independently

develop local markets and distribute beverages to grocers, small retailers,

supermarkets, restaurants and numerous other businesses. In turn, these customers

make our beverages available to consumers across India.

A National Council of Applied Economic Research (NCAER) study on the

carbonated soft-drink industry indicates that this industry has an output multiplier

effect of 2.1. This means that if one unit of output of beverage is increased, the direct

and indirect effect on the economy will be twice of that. In terms of employment, the

NCAER study notes that "an extra production of 1000 cases generates an extra

employment of 410 man days."

As a Company, our products are an integral part of the micro economy particularly in

small towns and villages, contributing to creation of jobs and growth in GDP. Coca-

Cola in India is amongst the largest domestic buyers of certain agricultural products.

As an industry which has strong backward and forward linkages, our operations

catalysis growth in demand for products like glass, plastic, refrigeration,

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transportation, and Industrial and agricultural products. Their operations also lead to

incremental growth for enterprises engaged in post-production activities like

merchandising, marketing and sales. In addition, they share best practices and

technological advancements with our suppliers, vendors and allied industries which

often lead to improvement in the overall standards of quality across industries.

COBO: Company owned bottling operations

FOBO: Franchisee owned bottling operations

PRODUCT PORTFOLIO

1. CARBONATED BEVERAGES

A. COCA COLA

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B. LIMCA

C. THUMS UP

D. SPRITE

E. FANTA

F. DIETCOKE

2. NON CARBONATED BEVERAGES

A. MAAZA

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B. KINLEY

C. MINUTE MAID PULPY ORANGE

D. GEORGIA

MARKET CLASSIFICATION

Market Classification

Geographical Area Competition

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Geographical - Internationally Coke segments its product

Country & region wise

Variations as per tastes & income

Competition-Presence of players such as:

Pepsi

Parle

Dabur

ORGANIZATION STRUCTURE

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SALES ORGANIZATION STRUCTURE

RECRUITMENT AND SELECTION

Coca-Cola recruitment process is well established, they give ads in newspaper,

company’s website, institutions,etc.

Coca-Cola recruits MT’s from premier B schools.

They mostly offer PPO’s to the Summer Interns.

SELECTION PROCESS INVOLVES:

i. Group Exercise

ii. Interview

iii. Presentations

iv. Psychometric tests

v. Situational Exercises

AGM

Sales Manager

Area Sales Manager

Sales Executives

Market Development Executive / Pre-sellers

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TRAINING

Coca-Cola India partners with Indian School of Business (ISB) to launch the Coca-Cola

– ISB Retail Academy

The ‘Parivartan’ program - Training small town retailers. Coke’s new strategy

involves training retailers (around 6,000 of them) in a program launched by the

Coca-Cola University

PERFORMANCE RATINGS

Exceptional performance (EP)-Contributions significantly exceed the stated

objectives in terms of quality, quantity and timeliness

Successful performance (SP)– Contributions meet and sometimes exceed the

objectives, which are based on challenging goals

Developing performance (DP)-Contributions meet some / most but not all of the

objectives and performance improvement is necessary

No Performance (NP)-Contributions frequently do not meet the stated objectives.

SALES FORCE MOTIVATION

Incentives based on quarterly performance

No. of units and/or total revenue, work as a base for incentives

Every executive needs to add new outlets every year to get UNIT incentives

Target achievers are recognized by giving:

A. TV, Fridge, etc.

B. Certificates / trophies

C. Lunch / outing with senior management, etc.

Foreign trips for managerial level & above

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REWARDS AT COCA COLA

FORECASTING

Combination of top down and bottom up approach

Forecasts based on factors such as:

A. Historical data

B. Economic parameters

C. Seasonal variation

D. Festivals, ceremonies, etc.

E. Weekly reviews to adjust monthly forecasts

Forecasts are region-wise, they are further broken down into cities, towns and

villages by sales managers.

• Employee salary increment

• Grade Jump, Designation change

• Annual incentive Plan (AIP) (for business performance, but fixed)

• Personal Progress report (PPR) (Annual Appraisal)

Yearly Basis

• Making the move (MTM, sales target achieve)

• Monthly turn hall (extraordinary performance)

Monthly Basis

• Employee of the Quarter (EOQ, non sales)

• Sales Dangle context

• Gold Context

Quarterly Basis

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DISTRIBUTION

DISTRIBUTION ROUTE

Key Accounts -The customers in this category collectively contribute a large chunk of

the total sales of the Company. It basically consists of organizations that buy large

quantities of a product in one single transaction. The Company provides goods to

these customers on credit, payments being made by them after a certain period of

time i.e. either a month of half a month. Examples: Clubs, fine dine restaurants,

hotels, Corporate houses etc.

Future Consumption -This route consists of outlets of Coca-Cola products, wherein a

considerable amount of stock is kept in order to use for future consumption. The

stock does not exhaust within a day or two, instead as and when required stocks are

stacked up by them so as to avoid shortage or non-availability of the

product.Examples: Departmental stores, Super markets etc.

Immediate Consumption-The outlets in this route are those which require stocks on

a daily basis. The stocks of products in these outlets are not stored for future use

instead, are exhausted on the same day and might run a little into the next day i.e.

the products are consumed at a fast pace. Examples: Small sized bars and

restaurants, educational institutions etc.

General-Under this route, all the outlets that come in a particular area or an area

along with its neighboring areas are catered to. The consumption period is not taken

into consideration in this particular route.

It Focus on high traffic locations-Railway stations, Bus stand.Coke India distributes using

2 routes

Direct Route

Indirect Route

Plant Warehouse

Direct Route

Market

Indirect Route

Distributor Market

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3 COBO Regions – 27 COBO units

1 FOBO Region – 12 FOBO units

DISTRIBUTION STRUCTURE

Direct Route: Direct On Order & Ready Stock

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Indirect Route: Distributors cover: 500-600 outlets

DELHI-NCR DISTRIBUTION

Distribution of Coca-Cola includes full Coverage of Delhi-NCR with 59 Routes spread across

region. The Retailer is Handling 45 Pre sellers. Company owned & contracted vehicles for

efficient distribution. The vehicles owned by company are 56 particularly for this region

only. Each of the transporting vans of company has one driver and two loaders to efficiently

load and unload goods.

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DISTRIBUTORS FUNCTIONS

Bulk Breaking Depends upon location

Warehousing Storage & safety

Transportation Distributor to retailer

Market Information Sourcing

Customer Intelligence

Competitor Intelligence

Consumer tastes & preferences

Maintaining

a) Visual Merchandising

b) Banners, posters, etc.

a) Signage

b) Interior ambience

c) Overall environment

Problems faced by distributor

• From company : discounts/incentives given at the end of the month

• From retailer : bad debts/run away

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LOGISTICS

1) Average order size

a) Distributor to company

b) Retailer to Distributer

Based on Demand, Season

2) Order placement

a) Distributor to company

b) Retailer to distributer

Phone

Distributor Representative

3) Transit Time 2 Days

4) Order frequency Daily

5) Inventory Maintained 1 day

6) Unsold/Damaged Merchandise Replaced

7) Technology

a) A/C Keeping

b) Stock keeping

c) Complaint Handling

8) Mode of Transportation

(company to distributor) Company vehicle

9) Transportation Expenses

a) Company to Distributor

b) Distributor to retailer

Company

Distributor

10)Warehousing

a) Storage Capacity

b) Ownership

Minimum 30 m2

Owned / Rented

11) Stock keeping responsibility Stock keeper

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FLOW OF THE PRODUCT

PERFORMANCE MANAGEMENT

RED Strategy – Right Execution Daily

Tool to measure the performance of the distributor in the outlet by setting some

standard or parameter of execution.

RED

Check Visi-Cooler Management

Availability of the product in the outlet

Check the activation in the outlet

Market Developer checks 25 outlets a day and report to HCCBL on the score of 100

•Pre-seller goes on his route and books the orders

9am- 6pm

•Order is registered on the server through GPRS on the spot

9am-6pm•Order is processed

•Load sheet is released

6pm-11pm

• Loading the vehicles is done by the C&F people

11pm-6am

•First vehicles leaves at 6am

•All vehicles leave by 9.30am

6am-9.30am

•Product delivery

•Empty bottles are collected

9.30am-8.30pm •Trucks return to

depot

•Unloading takes place

8.30pm-11pm

•Records are tallied

•Cash submission

11pm

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MARGINS

A margin per crate (comprising 24 bottles of 300 ml each) is Rs 20.

On the 200 ml pack size, margin is Rs 16 per crate.

Sales of the more affordable 200 ml pack size account for about 60 per cent of its

total carbonated soft drink (CSD) sales.

Non-CSD business accounts for 15 per cent.

Outsourced distribution so that trucks and other equipment needed for the purpose

are no longer owned by the company.

FINANCIALS

Profit Margin

a) To distributors

b) To retailers

1-1.5%

2-3%

Advance payment

a) to company

b) for refrigerators

1,00,000

5,000

Credit terms and policies

i) Credit amount

a)Company to distributor

b)Distributor to retailer

N/A

Can provide.

ii) Credit period One month(for retailers)

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LEARNINGS

The real time order processing system through use of technology helps reduce the

lead time

24hrs working i.e. the loading cases in the night saves valuable time

RECOMMENDATIONS

Pre-sellers shouldn’t be looked at as an extra cost. On the contrary, since their

inception sales have risen

Order devices at Diamond outlets can facilitate quicker order placement.

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REFERENCES

http://www.coca-colaindia.com/products/our_products.html

http://www.coca-colaindia.com/presscenter/cleanDrinkingWaterFacilities.html

http://www.coca-colaindia.com/products/product_list_desc.html