FLOW OF PRESENTATION

ABOUT THE COMPANY

Ø Diversified group of companies with
operations in various industry segments
from cigarettes to apparels.


Ø Annual turnover is of the order US$2.4

billion


Ø One of the largest retailing network in the

country


Ø Ranked 8th in the ET 500 survey.



Ø Products –Cigarettes, hotels, apparels,

PRODUCT PROFILE
ITC Limited – Imperial tobacco Ltd.
Turnover of US $ 4.75 billion
Registered office in Kolkata
Employs over 20,000 people
More than 60 locations across India
Listed on Forbes 2000
Cigarettes, Hotels, Paperboards,
Packaging and Agri-Exports
Packaged Foods & Confectionery,
Branded Apparel and Greeting Cards.
 ITC’s Distribution channel
 ITC’s Distribution channel is as follows:-
 COMPANY HUB FACTORY


Carried and forward agent



Wholesale dealer



small Wholesale dealer


Retailer

consumer

ITC . WORKING FOR YOU . WORKING FOR

INDIA . ITC. Touching your life. Everyday
 ITC FMCG Supply chain
• Consists of diverse categories with
different priorities
• More than 1000+ SKUs
• Buying Value $68 MM
• Warehousing space of more than 3.5m SFT
around 55+
• Locations
• Products manufactured at 45+ plants
• More than 650 trucks moved every day
• Direct distribution from factories to
Distributors.
• Indirect movement through RDCs
• Combination of Rail/Road/Sea movement
within the
 Indian Tobacco Division
(ITD)


• Market leaders in Cigarettes and

Tobacco business & is among India’s
most profitable companies
• Brands owned by ITC Ltd are Wills
Classic, Wills
 Navy Cut, Gold Flake, Bristol and
Scissors
• ITD also sells two luxury filter brands of
its parent
 company Benson & Hedges and 555
• Four manufacturing units for cigarettes
• It has 3 contract manufacturers
(OCMs)Reliable Cigarette and Tobacco
IndustriesPrivate Ltd. (RCTI)
• Asian Tobacco Company (ATC )
Hyderabad Deccan Cigarette
Industries(HDC)
• Huge distribution network with 19
marketing
 branches and 33 Godowns across
nation
• Also caters to the exports mainly in
United States
DISTRIBUTION NETWORK(Tobacco
Div.)
C a lcu tta M unger
B a n g a lo re S a h a ra n p u r
Factories
( 4)

GODOWNS
GODOWNS
((19
19)) BRANCHES
BRANCHES
((19
19))

Information
WHOLESALE
WHOLESALE DISTRIBUTORS
DISTRIBUTORS Goods
((60
60 PER
PER BRANCH
BRANCH))

RETAILERS
RETAILERS SECONDARY
SECONDARY
WHOLESALERS
WHOLESALERS
 Role of Each Member

Ø Factories – Supply to 18 godowns

Ø Godowns & Branches
ü Manage by C&F agents getting monthly
remuneration
ü No rent paid by ITC
ü one branch – 60 WDs , 5 AMs and 20 Area
Executives
Ø Wholesale Distributors(WDs)
ü Margin – 2% of sales
ü Appoints secondary Wholesalers
 PHYSICAL DISTRIBUTION

Ø Demand Estimation – collaborative

forecasting( Sales force with dealers)
Ø Forecast based on last month sales
Ø Production plan made according to forecast
Ø Delivery to C & F agents within 7 days
Ø CFAs deliver goods to dealers on the basis of the
branch office route plan
Ø Factory CFAs- Trucks
Ø CFAs Dealers – Small Vehicles

 ITC e-Choupal
• Started in the year 2000
• Target Area so far 38,000 villages, 6500
kiosks, 9 states
• Wholly owned by ITC
Why it become a success ?

• Only initiative to attempt to combine

Services and an Effective Business Model
successfully
Designed to address the issues such as:


1.Fragmented farms
2.Weak institutions
3.Involvement of intermediaries
4.Information Asymmetry
E-CHAUPAL
 Pakka Adtiya
(Registered
Dealer)

Trader

Processor
Money Lender Farmer
Broker

ITC -
IBD

Kaccha Adtiya
(Un-Registered
Dealer)
 Companies using e-Choupal
network

Source: Seminar on Bottom of the Pyramid and CSR, IIM-K, Sept. 24, 2008
Company Logo
 OPERATIONS ANDLOGISTICS

 Operation management emphasis the current

programs of an
 organizations and planning which essentially deals
with the future andtwo intimately related activities.
• A distinction should be made between planning and
forecasting .
• Planning departments are key in critiquing
strategies ,crystallizing
 goals ,setting objectives, maintain control.
• NEEDS FOR STRATEGY:
 1) resources are finite
 2) uncertainty about competitive strength and
behavior
 3)when commitment is irreversible
HI-TECH SUPPLY SOLUTIONS

• Thousands of small retailers in India who sell

cigarettes and
 confectionery supplied by ITC Ltd, and who
have thus far had to wait for the next arrival of
the company’s delivery
 van.
• Place orders through mobile phones
• Vans go without knowing actual demand so
after using this
 they can save cost as well as time.
• Mobility based applications can bring down the
cost of
 operation by 20-30% from the manual basis
ITC Supply chain