Godrej Consumer Products

2011102 R Kumar

Contents
COMPANY BACKGROUND.3 PRODUCT PORTFOLIO5 DISTRIBUTION CHANNELS..7 EXHIBIT I.9 EXHIBIT II.10 REFERENCES.11

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COMPANY BACKGROUND The Godrej Group of companies was established in the year 1897 and it was legally incorporated as per the laws of the companies act subsequently in the year 1932. The Product portfolio at the time consisted of Safes. Eventually the company branched out and in the year 1918 & incorporated a separate soaps division within the company. Thus began the companys foray into the Consumer products division for which it is most widely recognized today. The Godrej group of companies eventually underwent a demerger in the year 2001. The 75 year old company which was known as Godrej Soaps Ltd. (GSL) was demerged to form Godrej consumer products ltd and Godrej Industries ltd. The consumer products which included soaps, hair color, Household insecticide etc. were transferred to the Godrej consumer products division while Godrej Industries ltd retained that of construction materials, Security solutions etc. The company (consumer products and Industries) employs around 18000 employees and also has a wide array of products belonging to different categories from machine tools, furniture to healthcare, office equipment, interior designing solutions etc. Along with these the company has also ventured into a completely different territory with Construction, security, IT and industrial storage solutions. The company was known to be one of the last manufacturers of world-class typewriters in the world. The consumer products division at present focuses only on the personal, hair and fabric care categories.

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The various divisions of Godrej industries can be represented by the following chart:-

GODREJ PROPERTIES

SPENCER RETAIL PVT LTD

GODREJ CONSUMER PRODUCTS

GODREJ INDUSTRIES NATURE BASKET PVT LTD GODREJ HOUSEHOLD PRODUCTS

GODREJ AGROVET

GODREJ HERSHEY

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Product Portfolio

The consumer products division at Godrej has its focus mainly on the FMCG sector. The bulk of its revenue is generated from this. The total products in the portfolio of the company can be divided into the following categories:Hair care segment To cater to this segment Godrej has a very wide variety of products meant to cater to different kinds of consumers. The company produces hair colouring products, hair oils, shampoos etc. some of the products of this segment include Renew (Hair Color), Colour Soft (Hair Color), liquid hair dye (anti-graying), power hair dye, Almond Hair shampoo
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Personal wash This division at godrej has been the oldest division of the company. The personal wash segment consists mainly of soaps, body washes, shaving creams, aftershaves. The soap category alone has products which cater to a wide variety of income groups. While a cinthol is a product catered for the MIG where the product is priced in the range ofRs.15-20 the range of soaps such as Godrej No.1 is meant to cater to the LIG being priced at less than Rs. 10. The company has also forayed into the ever growing market of fairness creams in India with the launch of its product godrej Fairglow. The company has also ventured into the hand sanitizer market with the recent launch of the Godrej Protekt. Home Care The homecare segment of the consumer products division is mainly consisting of disinfectants, mosquito repellants (HIT, GOOD KNIGHT), clothes detergents (GENTEEL), starch, dishwashing liquids (GODREJ DISHWASH). The relative sale of each of its products as compared to its overall portfolio can be expressed using this:-

Personal Wash

1.9%
8.2%

Liquid Detergent

Hair Care products

26.8%

Soaps

63.0%

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Distribution Channels The total consumer base of godrej consumer products is very vast and belongs to different income groups. Godrej consumer caters to consumer of both the lower income group and the middle income group. In certain segment they also have products which cater to the high income individuals. While during the initial days of when Godrej had just about started diversifying into different markets it had followed a conventional approach of distribution where the goods once manufactured at the producer would then move onto the wholesaler from wherein it would then move to the retailer from where in the goods would be marked at their retail price for final sale to the consumer. The major manufacturing location of GCPL includes MP, Assam, Uttarakhan and Himachal Pradesh. The reasons for the setting up of plants in these places not only include logistic convenience but also tax incentives from the government which in turn would increase the profitability of the company. GCPL post the traditional phase looked to leverage IT in order to boost its supply chain systems. For this purpose they hired Accenture to prepare a strategic it investment roadmap. This is what eventually led to the birth of the SAMPARK which helped to link the distributors and the SAHAYOG which helped to connect the suppliers. These 2 innovations helped seal both sides of the supply chain. The implementation of the SAMPARK did not solve too many problems initially as the suppliers were resistant to adopt these methods due to which they had to function largely based on intuition and estimation. GCPL at present has around 1200 distributors of which around 400-450 are designated as A-class distributors while the remaining 750-800 are designated as B& C class distributors. The A-Class distributors are so called as they have been known to contribute to nearly 70%-80% of the business.

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The implementation of the SAMPARK had the following advantages to the company: Improvement in quality of service by improving the relation with the distributors and sharing information on a real time basis. Due to this software implementation the average lead time required fell drastically. This helped in stock replenishment on a daily basis than on a weekly basis. The message to the C& F agents was sent much quickly thus reducing any chances of having stock-outs. The financial benefits from the implementation of this helped because previously the company followed a 21 days cycle where any surplus products at the end were either recalled or strategically sold. This led to the distributor having to block his capital and thus having no incentive to roll the stock. Through the use of the Sampark the distributor shares his stock roll over on a daily basis thus making it easier for the C&F agents to replenish stock only up to the realistic extent required. With the free cash the distributor has he makes wiser investment strategies such as employing larger number of sales people which in turn leads to higher sales. The implementation of the SAHAYOG helped maintain real time information flow with the vendors/suppliers. Some of the benefits include: Real time tracking of orders with the vendors/suppliers. Clearing any debtors/creditors outstanding at the earliest.

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EXHIBIT I The overall distribution chain at GCPL can be defined with the following diagram:-

PLANT (FACTORIES)

PLANT (WAREHOUSE)

CLEARING& FORWARDING AGENT

REGIONAL WAREHOUSE

DISTRIBUTOR

RETAILER

CONSUMER R

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EXHIBIT II THE ROLE OF IT in the overall distribution chain at GCPL can be defined with following flowchart:-

Distributors Factories Broad Vision Application Plant Warehouse Broad Vision Database Central Database Regional Warehouse

Daily Closing Stock & Receipt information Order Confirmation

Carry & Forward Agent (CFA) Shipping and invoicing details Location wise stock

HO MIS Reports (Input for forecasting) (Stock Report Fact, CFA, Dist.)

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REFERNCES www.wikipedia.com www.scribd.com www.godrejcp.com www.moneycontrol.com www.sify.com

FACTORY (GOA) C/o Filpak India Pvt. Ltd 46/47 Pileme Industrial Estate Pileme, Brdez, Goa 403 511. GODREJ DEALER Mr. Pascal Fernandes Airwell Cooling 17, Sapana Centre Dr D V Road, Near Church Square, Panaji Goa Panaji 403001

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