Need and Importance of Strong Market Coverage through Distribution !!!

Hello Friends  !

In my Last blog we had seen the various channels of distribution in Consumer goods industry  like CFC-Super Stockist-Stockist- Retailers. All these contribute to large extent in making the product available to the end Consumer. We also have Modern technology  and online marketing came into existence .Also  to some extent  retailers lost major chunk of Business to Malls and big Super Markets. The Mall and Online Marketing has some advantages as they offer heavy discount ,but a consumer goes there and buy something which is secondary also.in which they make profits. Similarly online marketing is not popular barring some class as ,Consumers prefer to see the product ,feel the product and then only Buy.

Its talk in market place across few some Small /medium Fast moving consumer goods marketers ,who are established good brands but are suffering to great extent after the demonetisation and introduction GST impact .due to some confusions in mind of traders,what one reveals that the Whole- Sale Market or Semi Wholesale market which was contributing to 60 to 75 percent  market share have stopped buying the goods as ,they don’t want billing to happen on their firm name as No funds available in the firms account .so bulk contribution which was happening from big chunk of wholesalers  has given a big dent.

These companies were highly dependent on them ,as it was a cost effective media to sale, no hassle’s of huge distribution expenses, As every one know the pareto Principle *80 % business is done by 20% of People and ,80% of the People contributes 20% of Business Volumes.*

This is current scenario at market place today.But at the same time The Companies which had a good /robust distribution network have not Suffered to large extent..infact some report  are their volumes are increasing .

This is Power of distribution. One has to reach the last Retailer who sales your Product.to end Consumer.you get to know what the consumer requires,what is the demand of market.We have seen ,the CEO’s MD’s of big Business houses visits the market place and check the availability of their products speaks to retailers  take feel of the field Staff and Market.

In India if you have a good product supported by good Distribution system ,with regular Service you can do a business with the Relationship in Market. Some Company believes in service and ,The Company Person covers the Market at particular interval without fail.. Service is very Important, A retailer is happy to store the product if he is assured about regular Service, and moderate margins, promptly solving issues replacing Damages, if any.

Looking at all the Facts it is very Important to have a robust Distribution System, with dedicated passionate Sales Force in Place. You take any Product ,you would find at least two three competitive brands available with good quality, so it is very necessary to have Dedicated, matured, hard working field force, who will create and maintain the relationship in market place. The Retailer is King  for us and they have a good impact on consumer mind to some extent as they also have a rapport with their consumers for a long time. So to have good relationship with them is must .

Now with the competition the need of hour is have good Sales team at place, who would give their Best in Market place, to increase  the Market Share, as well as open new outlets to Sale. Salesman ship is an Art ,and we need to innovate and experiment new ideas to increase the width and depth of distribution. We need to develop the Sales team ,nurture and develop their skills, and keep them motivated all the time round the clock.

To summerise We need to focus and increase our strength in distribution, have a strong robust  distribution System in place so our product reaches the end Consumers.

We at Three Dimensions have various Sales training capsules, which can help the Sales Team, Sales Managers .executives- Field force by Training them ,on How to increase the WOD and DOD of the Markets, Launching of New Products ,Increasing Productivity per day per call. We also work as Sales Strategist ,Offer Consultation in planning the Sales Volumes, designing Incentive schemes, conducting review meetings ,and So On.

We customise our services as per the need of the client

As We had good rainfall and cultivation around ,the Economy is expected to grow with  GDP increasing, more funds available in hand of consumers and the person who reaches maximum  selling points will be winner here onwards.

Feel free to get in touch with us for our services on the details mentioned Bellow

Shirish Sharad Patil

Sales Strategist & Training Consultant

Three Dimensions Training & Development,Pune

Email:shirish.patil@hotmail.com ,shirishp2211@gmail.com mbl:+919890333611

FMCG Products ,An investment Opportunity for all

Fmcg Product Distribution an Opportunity & challenge In India

Hello Friends

I am  Shirish Sales Strategist and training Consultant from Pune.Welcome to my Blog. I wish to discuss with You,  the various  opportunities for Investment and moderate to good returns in Consumer goods industry. One can look forward to Avg 20% to 35 % returns on investment over a period of time.I have Started my career in Fmcg Industry and have been  trained  from Frontline Sales representative to the State level head . In every economy rich or poor the Vicious Circle of Boom and recession hits in almost between 8-12 years. the impact of recession comes on Consumer goods Demand Supply Cycle ,especially as buyers restrict their purchases- resulting into stoppage in production, so no sales as no demand and economy get  stucked in between as ,Cash revolving stops to some extent

However  Only  One Industry which is hardly affected is Fast moving consumers goods industry ,as it caters to daily needs products of consumers and irrespective of funds availability they are consumed. If see the Statistics for the recession we had in 2008 , everything had suffered and only Fast moving Consumers goods industry which sales most of the over the counter  (OTC) Products had not only maintained the Sales Volumes but had shown growth in turnover and Sales.

Now I am sure if anyone wishes to start Business can look forward as to be part of the FMCg Industry. Lets Understand the Various intermediaries in the Supply chain.

Manufacturer Sends Goods to Distributor/Super stockist

   

Distributor supplies to Retailers /Wholesalers in the assigned Market  area 

Super Stockist Suppliers to Small town distributors   

Retailers services the consumers in their locality                                      

        

                                                    

Lets understand the above chart and the inter mediators involved in the Fast moving consumer good industry.Some may find it very basic info but necessary to have the same.

Manufacturer : It is the first person in FMCG who has an Idea ,who manufactures goods as per the need of the Consumers. He obtains the raw material, produces finished goods and make available same for the Use to consumer.

CFA : is a Carrying and forwarding Agent who has Huge go-down space with huge capacity and stores the goods in his go-down his remuneration is fixed .His main function is to store sufficient stocks in his go-down and execute the orders received from Distributors, Super stockist  arranging the despatches ,on time with the help of Transporters. CFA is not responsible for collection of payments, he only provides his services and gets remuneration for the same

Distributor /Stockist : Distributor or Stockist is main link who manages the distribution of goods in assigned area. They are Local suppliers who have infrastructure to ensure timely supply of products to Retailers in the particular locality or area. Distributor places orders with the Company and supplies the same I market place.for a Distributor they need infrastructure ,like goods  carrying vehicles, Salesman Delivery boys, accounts  billing staff, small office, internet connections computer to make the operations smoothly. Distributor buys the goods from Company and sells the goods to retailers ,he has invest money in goods on which company gives commission. He can sell either in cash or can offer credit in the market place , as per situation demand. Normally a Distributor can serve 300/400 retail outlets in the area with good services, to be cost effective and earn good profits in terms of ROI. we will discuss the Roi concept in detail later on. The distributor has  bears the risk of offering   credit,in the market place,and the company is not responsible for bad debts if any occurs. Distributor being a localite have good contacts knows the retailer very well so chances of loss or bad debts are minimum. Distributors also supplies goods to Wholesalers who sells to retailers where distributor may not reach.

Wholesalers :They  are nothing but Big retailers who are normally located in Heart of marketplace Bazar or mandi and sales goods to small retailers.They have all products available and retailer is at advantage that he gets all his requirements in required quantity under one roof only. As they buy in huge quantity they are in a bargaining position and gets extra commission, from distributor ,sells goods at the same prize or rate of retailer,as they work on very less margin and believes on turnover business.He is likea day trader in share markets buys and sells daily ,and books profits, may not very loyal, buys from anyone who gives more margin.

Super-Stockist : Super stockist is  nothing but a Distributor who caters large area may be a whole district or group of two three districts and supplies goods to small distributors or small town distributors. The concept of super stockist has emerged as india is a country where 70% of its market is scattered and in rural towns. For CFa to provide services in interior towns was challenging but ,if you have a super stockist at district level or taluka level he can further take care of needs of small town distributors. normally Super stockist supplies goods on advance payment and at their own discretion may or may not offer credit to the distributors under him. this model serves best for Fmcg industry, as stocks are available near the small towns and they can place the orders in small quantity with super stockist and it is very easy logistically to supply on time, so market gets services and availability of goods in each and every town of the country.

What we have discussed is a traditional way of business but still has it own distinct advantages. With the revolution in technology with internet and mobile accessibility everyone has info at figurtips at a click of mobile. So a New concept has emerged of Online marketing .Online marketing  is direct or one step contact between Consumer and the Product manufacturer. Online marketing has got its own advantages as well as shortcomings. Consumers gets product at cheaper rate as all the intermediaries from CFA –Stockist-Retailers are removed so the cost of their services can be passed on to the end consumer. Online marketing has given good boost to Supply chain management , the courier industry.

Friends so far I have discussed the structure of Fmcg   Industry ,today, in the next Blog I would discuss more about the dynamics specially related to Sales in detail. The above blog notes might be known to everyone but can really help the New Investor who is looking to invest funds in to business or looking for an opportunity to earn good R.O.I.

To manage all the Intermediaries we need  Sales People , to have maximum Output with minimum expenses we need SMART PEOPLE  and they have a very important role to play .they serve as a very important Link between the Company and the End market place where sale happens.so we will discuss about the role of Sales Staff in the next Blog.

Myself shirish have spent almost a decade plus in FMCG, learned ABC of Sales as a front-liner, Representative with Reputed Cos like Marico, Wipro Cons care, Murugappa group and had reached to a state head level. Currently we are into training FMCG, Banking and service Industry.It is my pleasure to share my experience ,which can be useful to the existing Sales organisation as well as people who are entering into the field

Lets stay in touch , watch this space for new Tips On sales on my blog SalestipsbyShirish

Regards

Shirish S. Patil

Sales Strategist & Sales Training Consultant

Pune

Email: shirish.patil@hotmail.com,     Website : @salestipsbyshirish                          

                  MBL:+919890333611