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5 DISTRIBUTION PLAN

5.1 Target Market Segment Strategy


These activities include the advertising, product promotion, retail management, etc. The activities are performed to make sure that the products are transferred to the targeted customer groups. We are targeting the customers of age group 18-30 who are young or working couples, as they have time constrains & ready to accept new product for experiment. We will be using a two-level distribution framework by selling direct to retailers and cutting out only the wholesalers. A retailer could do the same thing by going directly to manufacturers.

The distributor person will be on commission base. A prior training will be given to the distributors for effective & timely distribution of the product. He will be targeting the product to be distributed initially only in supermarkets like Big Bazar, Easy day, reliance Fresh, More & some small private owned outlets. The distributor will insist the retailer to keep our product in grocery section beside where the unflavored rice packets are kept. The distributor will also design a small window where our item will be kept, which is attractive & self explanatory for the launch of new product. This will act as a self advertising of the product & will gain customer attention towards our new product.

5.2 Technology
To streamline the efficiency of our distribution methods, we will be using the latest in cutting edge technology not only in the warehouse but also in the trade & manufacturing. We will be having advanced equipments installed for processing & packaging, also equipped with software to manage returns and collections; adjusting item price, profit or margin; applying promotional items to an account; streamlining orders; tracking inventory; reducing out-of-stocks; and providing sales history reports. All information recorded in the software is available in real time to be viewed by management in the office.

5.3 Packaging
Proper distribution of rice requires having rice packaged in various sizes. Since we are providing precooked rice which can be prepared instantly following sizes will be available for consumer:1.250gm 2.500gm 3.1 Kg 4.5 Kg 50 kg packet (plastic sack) for warehouse storage before secondary processing is done. All the information related to nutrition, recipes as well as batch number, bar code, address, MRP, etc. will be printed in each and every pack. The packaging meets all regulatory requirements

5.4 Distribution Pattern


Direct Distribution Direct contact between producer and customer. Most common in B2B markets. Often found in the marketing of new products. Internet is helping companies distribute directly to consumer market.

In distribution channel e-choupals shall be implemented to obtain finest basmati rice for the production of flavored basmati rice directly from farmers. The e-choupals initiative provides computers and Internet access in rural areas across several agricultural regions of the country, where the farmers can directly negotiate the sale of their produce .This backward integration gives them two distinct advantages. The first being reduction in the cost of basmati rice by around 2 percent as no middlemen is involved in the process. The second advantage is of course quality. The penchant for basmati rice among South Indians has kept the region among the top consumer of the product among all other Indian states. Despite shooting rice prices for over a year, there has been no major dip in demand from the southern part of the country that still constitutes a lions share of domestic consumption of the rice. South India alone constitutes about 30-35 per cent of the market in the branded basmati rice category.

As the above chart show northern states are leading cultivating states of Basmati Rice production in India. Among the northern states Haryana contribute 50% of production. The organically farmed basmati rice will be produced & cultivated in Karnal in North, a place of Haryana state & this spatial discrepancy can be overcome by setting up unit for rice processing(removal of husk and 50 kg packaging) in Kurukshetra which is 35-40 Km from Karnal where basmati rice is collected via E-choupals directly from farmers. Hence the processed 50 Kg packed bags will be transported to Salem in south,Tamil Nadu State via rail route. Once the product reaches Salem and stored in a warehouse which is hygienic & equipped with all the basic facilities like reptile protection, climate protection & security. Here there will be industry for further rice processing (addition of flavor, pre cook and packaging) for direct dispatch to retailers.

Logistics is the activities involved in controlling the flow of goods, services, and information among members of the supply chain. Here physical product distribution method will be applied in which product are sold in a master pack and require a cutting, or breaking down of the master pack to be sold in smaller quantities. So 50-200 packs of (250gm,500gm,1 kg,5kg packet) will be packed will be manually packed in a carton box containing different flavors. As there is good connectivity to Southern Tier 1 and Tier 2 cities by road, it will be transported to the market of South and surrounding areas through mini transport vehicles as well as to East using rented trucks. The warehouse & industry in charge of Salem will be responsible for the distribution and transportation once the product reaches their storage area i.e. warehouse. The basic focus will be on tire 1 & 2 cities of South & East such as: Bangalore, Chennai, Hyderabad, Mangalore, Vijayawada, Vishakhapatnam, Coimbatore, Cochin, Trivendrapuram, Kazikot, Mysore Bhubaneswar, Cuttack, Rourkela

5.5 Storing
Certain portion of the product (i.e. rice with husk) should be preserved as a seed for next plantation. Storing the seeds is one of the important factors that increase the production of organic basmati rice. The major problem in the reducing production of organic basmati rice is mutated seeds hence to eradicate such problem the seeds will be scrutinized to identify mutated seeds and non mutated seeds (with the help of farmers and other stakeholders) after segregating the mutated seeds from non mutated seeds only those seeds which are not mutated will be selected and stored for next plantation, this will help in preserving the genuine organic basmati rice as well as increase in production to certain extent. The storage facilities thus built will have the basic feature to preserve those seeds. The final product (i.e. organic basmati rice) will also be stored, in fact 5% of the total purchase from farmers will be stored as a safety margin stock, whereas 95% of the total production will be sold in the market. Minimum inventory levels must be maintained to ensure that there is no loss of sales due to problems such as late shipments and back orders.

5.6 Services, Terms & Conditions:


There will be term with the retailer for payment within 10 days from product delivery. Discounts for early payment but no impose penalties for late payment in the early stages. In spite of these a retailer & the distributor will be awarded to encourage their achievements of targets. We will have customer care for handling queries & receiving feedback of the product from customers & retailers.