SALES AND

DISTRIBUTION
MANAGEMENT
ASSIGNMENT I

6, 2016
SUBMITTED TO: PROF. D.K. BATRA
Submitted By: Group 5 Batch II
Anuj Bansal
Mamun Reza
Mitul Takiar
Monil Bhardwaj
Sanskar Pandey
Shreya Gupta
Yashila Sharma

EMAMI NAVARATNA OIL

DISTRIBUTION CENTRE MOTINAGAR, NEW DELHI
1. Different SKUs available for the product
2.7 ml (Sachet)
20 ml
50 ml
100 ml
200 ml
300 ml
500 ml
2. Stock of each SKUs available at the distribution center (DC)
They usually keep a stock of 15 days, approximately 20 cases of each SKU.
The number of units per case varied with the SKU variant,
e.g. 2.7 ml 3072 units
50 ml 120 units
200 ml 60 units
3. Most profitable and/or highest selling SKU
The bottled units were more profitable, in general. To be specific, the 100 ml
SKU sold the most.
4. Seasonality of the demand
Besides the time around December the demand was fairly constant
throughout the year.
5. Territory covered
The area/territory under each DC was defined by the head-office but the
outlets to be covered were at the discretion of the DCs. No two Market
Reportee (MRs) or DCs catered to the same outlet. On an average the
company assigned one MR for every 240 outlets.
6. How many Sales Personnel are employed?
It depends on the number of outlets to be covered. Their DC had 5 MRs.
7. How are the Sales Quota decided?
To decide on the Quota of a particular month they would look into the Actual
Sales of that area for the same month from the previous year. And based on
the same the quota was decided.
For example, if they planned a 20% increase in Sales for the month of August
2016, they would look into the Sales figure for August 2015 and increase by
20% to arrive at the figure for August 2016.
Once the area figures were decided the target for the salesmen were decided
based on their past contribution percentage (contribution in the previous year
for the same period)
Increase in Sales (percentage) = IS

Previous Sales (during same period for last year) = PS

Current Sales Target [CS] = PS* (1+IS)
For MRs
Current Sales Target = CS* Contribution
Where, Contribution = Sales made by the MR [Last Year] / Total Sales
for the area [Last Year]
8. New Outlets
Besides the Quota for the Sales they also had a yearly Target for the new
outlets. And the choice of the new outlets were at the discretion of the
Distribution Centers unless any new outlet had placed a call to the company
and asked for their service.
9. Incentives Schemes
The Salary is fixed for the MRs. The incentives are based on certain criteria
like
a. Target vs Actual Sales achieved
b. Productivity e.g if the MR made 1000 calls and 650 of them were
converted then he would get an incentive for the 65% conversion.
c. ECO (Effective Coverage of Outlets) - The number of outlets actually
placing orders. Lets say if the MR covers 200 outlets and 150 of them
place orders, so he would get an incentive for the 75% conversion
d. Brand Focus If the firm introduces a new brand and the MR is able to get
orders for this new brand from 100 of 200 outlets he serves then he would
get an incentive for the 50% conversion.
Example: For 40% placement of the product the incentive amount was Rs.
1000/In 95% of the cases the incentives were in cash and the rest 5% were in kind
(example: dress materials, etc.)
The Top 5 performers of the State/Union Territory were awarded an additional
amount of Rs. 2000/- per month.
10.
Replenishment Cycle
The replenishment cycle was usually weekly i.e. they would take the orders
from the retailers on a weekly basis and the delivery would be done by the
very next day.
11.
Credit Period
They followed a 1 Week credit period
12.
Vehicles at the distribution point.
They had 2 Vans (auto-rickshaw goods carrier), 2 Two-wheelers and 1 Bicycle.
The bicycle was for the regions where the other vehicles couldnt go. With
every van they had 1 driver and 2 helpers.
13.
Routes of the distribution

The routes of the distribution were at the discretion of the drivers and helpers
based on their previous experience and expertise.
14.
Shelf space
The shelf space provided is mostly at the discretion of the retailers for the
Stand Alone Retailers. But the small kirana stores the MRs could ask them to
keep these products in places such that they had better visibility.
15.
Window Display
The retailers were supposed to place a minimum order of certain amount
(varying every month) to have the provision of the window display. The
company pays them a certain amount for a specific period.
For Example, Rs 1000/- for a period of 45 days
Also, it is the responsibility of the MRs to ensure that no other products share
the same Window space during this specific period.
16.
Salesforce
The Salesforce of the company were quite motivated and the attrition rate
was extremely low, which portrayed the fact that they were happy with the
compensation scheme in place.
The Sales force had to undergo a mandatory training every 6 months.
Any underperforming Sales are handheld/mentored by the Area Sales Officer
(ASO) for a certain period based on the need.
17.
Schemes for the Retailers
The schemes are defined by the company and they change on a monthly
basis. Below are the schemes for the month of July16. [Exhibit 1]

18.
Book-keeping by the Sales Man
The MRs were required to keep a simple book (Daily Sales Report [Exhibit
2]) where they had to note down

i.
ii.
iii.
iv.

The
The
The
The

Retailer Name
Retailer Category
Retailer Class
Number of Units ordered per SKU

19.
Current Position against Competitors
Emami Navratna Oil is doing pretty well against its competitors. Though there
are certain products which had margins as high as 50% like Himgange.
20.
Last Mile reach
If we consider the urban areas the reach is fairly impressive. To put a number
to perspective, in Delhi alone we cater directly to 20,000 outlets and an
additional 50,000 outlets are covered through the wholesalers.
In the rural areas we do not directly reach out to the retailers and that is
mostly at the discretion of the super-stockists.
21.

Issues faced by the DCs and Retailers

Stock Unavailability - This is a very critical issue since they do face this
once in a while and it does quite a damage for the company as a
whole.
Aggressive Competition On certain periods when the competitors
aggressively promote their products Emami does face some heat but
that usually subsides soon.
Supplier Issue In case any Distribution Centre is unable to supply the
order to the retailer, the retailer gets in touch with the wholesaler who
actually, more often than not, gives them a better margin. So from
next time onwards these retailers demand similar margins from the
DCs as well. This turns out to be like a foot in the door situation.

EXHIBIT 1 SCHEME FOR THE MONTH OF JULY16

EXHIBIT 2 THE BOOK

EXHIBIT 3 THE PRODUCT CATALOGUE