4. Distribution Channel Structure
Four Zones:
• North Zone: Delhi
• West Zone: Mumbai
• East Zone: Kolkata
• South Zone: Chennai
Branches:
• 19 Branches all across the country
• Located in State Capital or Metro City.
• Managing operations for entire state.
• Headed by Branch Head (Asst. Gen. Manager)
• Every branch has both Sales and Service team.
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5. Gujarat Region- Ahmedabad Branch
• Its operates in Gujarat region is handled by Ahmedabad Branch located in Ahmedabad
city.
• Manages Two company owned Stores in Ahmedabad city, 15 Distributors and 400 plus
retailers all across the state.
• Each Distributors has a strong network of retailers in their respective area.
• Major share of Business from 7 Metro cities of Gujarat (Ahmedabad, Baroda, Surat,
Rajkot, Bhavnagar, Jamnagar and Bhuj)
• It has its central warehouse near Ahmedabad, owned and managed by “Godrej & Boyce
Mfg. Co. Ltd.” (Parent Company)
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8. • Stores owned and managed by “Godrej Interio Division”.
• It has separate display of security products.
• Security Solution division gives commission to Interio on sales of its products.
• Interio store employees are trained by security solutions.
• Security Solution division gives quarterly consumer discount schemes for stores.
• Security product purchased from store is eligible from free delivery.
• The store can directly pick up the security product from warehouse without intervention of
security division.
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9. 2. From the counter of Distributor/ Retailers/ Hardware Shop
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10. • Distributors are assigned by Security Solution branch office of the respective state.
• Security Solution division has hired TSIs and they have assigned different territories.
• TSIs are the one point contact for distributors.
• Distributor’s standard margin is 20-25 % on product MRP.
• They pass on 15-17 % to their retailers.
• They have to give discount scheme benefits to their customers, however it is borne by the
company.
• The company gives many promotional schemes for distributors and retailers also.
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11. 3. From E-Commerce Web-site
•Many popular models are available online for sale.
• These transactions are centralized and under the monitor of H.O.
•E-commerce websites has direct access to the system, it helps them to commit delivery date.
• They forward order confirmation to the respective branch office via e-mail.
•It is branch’s responsibility to deliver the product to the customer once the order is confirmed.
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12. Logistics
• Central Warehouse is located at Vikhroli, Mumbai adjacent to manufacturing plant.
• Each branch has its own warehouse, owned by parent company “Godrej & Boyce Mfg.
Co. Ltd.”
• They have been allotted storage space in the warehouse according to their market share
and requirement of their models.
• Logistics part is managed by “Commercial Division” an independent body hired and
handled by “Godrej & Boyce Mfg. Co. Ltd.”
• The division has to co-ordinate effectively with the Commercial Division for smooth
operations.
• Total stock on hand and quantity of each SKUs are decided by H.O. of Security division.12
13. Transportation
• Parent company (Godrej & Boyce Mfg. Co. Ltd.) uses third party transportation.
• Transportation cost to deliver the products from Central warehouse to Branch warehouse is
bear by the Head office.
• Transportation cost to deliver the products from Branch warehouse to Distributors location
is bare by Branch office.
• They have long term contract with selected transporters which gives them cost benefit.
• They provide FOS delivery in case of direct purchase by the customer from its authorized
outlet.
• It is mandatory for all transporters’ employees to wear the uniform provided by the
company.
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14. Gaps in Logistics & Transportation system
• As the division is holding too much variety of product the “Inventory cost” is very high.
• Very difficult to push slow moving models, it unnecessarily occupies the space.
• Some models are in high demand but the supply is very low which resulted in to “Lost
sales”
• It comes under the authority of Commercial department, so the goal might not be the same
which creates conflicts.
• Have no clarity on the clearance of SKU’s with manufacturing defect, transportation
damage and incase of returned stock.
• There are many false claim of “Manufacturing defect” by the transporter in case of material
received in damaged condition.
• In many cases the transportation cost is very high as compared to the value of the product.
• Conflicts between Logistics division and branch office regarding the inventory level and
delivery related issues. 14
15. Use of Technology
• BaaN is the information system used by Godrej Locking and Security Solutions.
• This system is accessible by every employee of the organization.
• It is used for Stock, Customer database, Accounting and finance and Manufacturing related
activities. 15
16. Use of Technology
• The distributors and retailers does not have an access to the BaaN system.
• They contact the TSI (Territory Sales In charge) as and when the material is required.
• They gave order for required material via E-mail, or Telephone.
• Every morning the distributors receive a spreadsheet with the types of model and its
availability.
• The distribution can send Inventory/ Non inventory credit notes, return order and refund
order forms via mail.
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17. Chance of Improvisation
• They should have an access to the system, it helps them to commit proper delivery time to
their customers as well as it reduces their dependability on TSI’s.
• The company should develop common platform for its channel partners. (i.e. Wal-Mart and
P&G)
• They should have an effective system, which may help channel partners to know the
availability of the product.
• It also helps company to know the trend in the market and forecast the sales.
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19. • Ms. Ashok Traders is a retailer of Godrej Locking and Security Solutions.
• They are happy with their distributor and the company.
• They stay connected with the company and gives update about the sale of the products via
Mobile application.
• They enjoy the benefits of brand name of the company.
• They are happy with the quality of the products and the service provided by the company.
• They are satisfied with the margin given to them by the distributor.
• They want that the suggestions given by them are implemented.
• They complain that the delivery of some popular models is slow after placing an order.19
21. • Ms. Laxmi Enterprise is the distributor and also have their own retail counter for
Locking and Security Solution products.
• They are happy with the product quality and service of the company.
• They bagged many big orders from Government institutions and Residential schemes in
last couple of years.
• They are satisfied with the support provided by TSI assigned to them by the company.
• Many times they have the telephonic conversations with senior authorities of the company.
• They have some complaints with the service department of the company.
• They have to wait long time to get the missing part of some products.
• They are demanding from company to increase the margin.
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23. From the Channel Manager’s desk
• Channel Manager in this organization is known as TSI (Territory Sales In charge)
• Co-ordinate between the company and its channel partners
• Quarterly and yearly targets to achieve
• Ensure Customer Satisfaction and Customer Relationships
• Key account management
• Business Development
• Product Promotions
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24. • Maintaining good relations with the distributors and retailers is always TSI’s first priority.
• Proper sales and product training to dealers and retailers employees.
• Convincing distributor to increase the quantity of ordered product.
• Responding to distributors and retailers service related complaints.
• Ensuring that they get the delivery of their ordered material on time.
• Ensuring that they get the missing parts of the products on time.
• Helping and providing support to distributor or dealer during the process of Government
tendering and other big requirements.
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25. Our experience @ Retailers shop
• According to our observation majority retailers are happy with the company.
• They don’t have to make extra efforts to sell the products due to Brand name and reliability
of the company.
• Almost all retailers are Multi-product and Multi-brand retailers.
• It is very difficult to find exclusive retailer in this segment.
• Retailers usually deals with individual customers (B2C segment)
• They sometimes gave some extra discount in order to close the sale.
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26. Channel Establishment Plan
• Purpose to set-up:- To increase sales and market share of Locking and Security products.
• Profile of the customers: - Individuals (Urban, Semi urban and Rural area)
- Financial Institutions
- Government and Semi-Government institutions
- Real estate Market
• Operations of the existing channels:- Manufacturer, Distributor, Retailer
• Roles and responsibilities of the channel constituents:- Deal with both B2C and B2B
segment
•The proposed remuneration for performing these roles and responsibilities:- Margin on
MRP 20-25% to Distributor out of which he pass on 15-17% to Retailers.
• Criteria for appointing the channel members:- Financial stability, Geographical location,
Showroom space, Past experience in this field. 26
27. Our Finding and Gaps
• Lead time for some popular models are very long.
• Lead time for far away area distributors (Ex. Palanpur, Porbandar) is long as compared to
Big cities like Ahmedabad.
• Problems in the process of “Return Order”
• Company provides FOS delivery within Ahmedabad city even for small quantity orders
which results in increased cost.
• Service related issues.
• Conflicts between COCO Stores and Dealers.
• Co-ordination issues with Branch office and warehouse in the case of online orders. 27