ORGANISATIONAL STUDY AND PROJECT REPORT

Submitted to

RAJAGIRI BUSINESS SCHOOL

In Partial Fulfillment of the Requirements for the Award of

POST GRADUATE DIPLOMA IN MANAGEMENT

(2014-16)

By

ARUN MATHEWS JACOB

Register No: P14238

RAJAGIRI BUSINESS SCHOOL

RAJAGIRI VALLEY

KAKKANAD, KOCHI 682039

DECLARATION

I, ARUN MATHEWS JACOB, hereby declare that the internship report titled A study Opportunity

Analysis of ITC products in Chemist Outlets is a bonafide report of the project work done by me at

SIB, Bangalore during the period from April to May 2015.

This study was undertaken in the partial fulfillment of the requirement of the degree in Post Graduate

Diploma in Management at Rajagiri School of Management, Kakkanad, Cochin.

I also declare that this report has not been submitted to any other university/board for the award of any

degree/diploma.

Place: Kochi

DATE: ARUN MATHEWS JACOB

Roll No. P14238

Acknowledgement

The gratification and elation of this project will be incomplete without mentioning all the people who

helped me to make it possible, whose guidance and encouragement were valuable to me.

I would like to express my gratitude to the Dr. BENOY JOSEPH. for granting me the opportunity to

do the project.

First of all I thank the God Almighty for his immense grace and blessings at each and every stage of

the organizational internship. I am thankful to my Faculty Guide, Prof. Dr. BEJOY JOHN

THOMAS, faculty, Rajagiri Business School, Kochi, for giving me his valuable guidance to execute

the project as per university requirements.

My sincere thanks to my project guide, MR.A.S.KIRAN, Asst. Manager, for giving me an opportunity

to carry out my project study and for sparing his valuable time for the same. It was a learning

experience to work with him.

I would like to record my deepest sense of gratitude to my friends who encouraged me for making this

project a success.

Above all I would like to thank all respondents who helped me with the valuable information I needed

for the project.

Thanking You,

Arun Mathews Jacob

Contents Executive summary ......................................................................................................................................... 1

Industry Analysis .............................................................................................................................................. 2

FMCG industry economy ............................................................................................................................ 2

Common FMCG products ............................................................................................................................ 3

Market potentiality of FMCG industry ........................................................................................................ 3

SWOT ANALYSIS OF FMCG INDUSTRY ............................................................................................................. 4

INDUSTRY PROFILE .......................................................................................................................................... 6

COMPANY HISTORY ......................................................................................................................................... 7

COMPANY PROFILE ........................................................................................................................................ 12

Vision, Mission, Core Values and Governance Policies ............................................................................. 12

CORPORATE STRATEGY.............................................................................................................................. 13

CORPORATE GOVERNANCE ....................................................................................................................... 13

CORE PRINCIPLES ....................................................................................................................................... 14

COMPANY STRUCTURE .................................................................................................................................. 15

Marketing Department .............................................................................................................................. 17

Group Companies ...................................................................................................................................... 18

JOINT VENTURE ......................................................................................................................................... 21

ASSOCIATE COMPANIES ............................................................................................................................ 22

COMPANY STAKEHOLDERS ........................................................................................................................ 22

ITC e-CHOUPAL .............................................................................................................................................. 24

ANALYSIS OF THE COMPETITORS OF ITC LTD. IN CHEMIST OUTLETS AND THEIR MARKETING STRATEGIES.27

SCOPE ........................................................................................................................................................ 28

Detailed Study on FMCG goods and services in Chemist outlets .............................................................. 28

OPPORTUNITY ANALYSIS FOR ITC PRODUCTS IN CHEMIST OUTLETS ........................................................... 36

CONCLUSION ............................................................................................................................................. 38

MERCHANDISING ACTIVITY ....................................................................................................................... 39

MERCHANDISING OF ITC PERSONAL CARE PRODUCTS IN CHEMIST OUTLETS ............................................. 40

CONCLUSION ................................................................................................................................................. 41

Bibliography ................................................................................................................................................... 42

1

Executive summary

The FMCG sector in India has played a vital role in the growth and development of the country Fast

Moving Consumer Goods (FMCG) also known as consumer packaged goods, are those goods which

are sold quickly at relatively low costs. Some examples of FMCG includes the wide variety of

frequently purchased consumer products like soaps, tooth pastes, detergents, shaving products,

packaged food products etc.

ITC is an Indian conglomerate headquartered in Kolkata, West Bengal. Its diversified business

includes five segments: Fast Moving Consumer Goods (FMCG), Hotels, Paperboards & Packaging,

Agri Business & Information Technology. ITC is an outstanding market leader in its traditional

businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports. As part of the summer

internship program various projects done in ITCs FMCG -personnel care sector the project on

opportunity analysis of ITC products in chemist outlets, study of effectiveness of low cost

merchandising activities in chemist outlets.

As a part of study on opportunity analysis of ITC products in chemist outlets 650 chemist outlets was

mapped and visited to collect necessary information regarding the market, competitors. The

information regarding the market was documented for further studies. As the part of project

merchandising activities was carried out in 30 chemist outlets and its effectiveness is to be measured

by analysing the change in sales percentage. As the part of the project a study was also initiated to

understand the influence of chemist channel in consumer buying behaviour of FMCG goods.

2

Industry Analysis

FMCG industry, also called as CPG (Consumer packaged goods) industry primarily deals with the

production, distribution and marketing of consumer packaged goods. The Fast Moving Consumer

Goods (FMCG) are those consumables which are normally consumed by the consumers at a regular

interval. Some of the prime activities of FMCG industry are selling, marketing, financing, purchasing,

etc. The industry also engaged in operations, supply chain, production and general management. More

and more companies are entering this emerging sector with better products. Global consumer product

groups eyeing inorganic growth opportunities in emerging markets like India. Quite a number of

people of India are dependent on the FMCG products for their day to day operations. Its principal

constituents are Household Care, Personal Care and Food & Beverages.

FMCG Industry is one of the few industries which have showed a positive growth even in the time of

recession. The year 2016-17 is likely to be a very positive year for the FMCG industry as a whole.

Despite rising commodity prices, which will continue to put pressure on performance, we can expect

demand to continue to be robust especially from rural India which is seeing rising income levels and

greater propensity to spend. Some of the merits of this industry are low operational cost, distribution

networks, presence of renowned FMCG companies, and population growth.

FMCG industry economy

FMCG industry provides a wide range of consumables and accordingly the amount of money

circulated against FMCG products is also very high. The competition among FMCG manufacturers is

also growing and as a result of this, investment in FMCG industry is also increasing, specifically in

India, where FMCG industry is regarded as the fourth largest sector with total market size of US$13.1

billion. FMCG industry is regarded as the largest sector in some countries of the world like New

Zealand.

3

Common FMCG products

Some common FMCG product categories include food and dairy products, glassware, paper products,

pharmaceuticals, consumer electronics, packaged food products, plastic goods, printing and stationery,

household products, photography, drinks etc. and some of the examples of FMCG products are coffee,

tea, dry cells, greeting cards, gifts, detergents, tobacco and cigarettes, watches, soaps etc.

Market potentiality of FMCG industry

Some of the merits of FMCG industry, which made this industry as a potential one are low operational

cost, strong distribution networks, and presence of renowned FMCG companies. Population growth is

another factor which is responsible behind the success of this industry.

The Indian FMCG sector is the fourth largest sector in the economy with a total market size in excess

of US$ 13.1 billion. It has a strong MNC presence and is characterised by a well-established

distribution network, intense competition between the organised and unorganised segments and low

operational cost. Availability of key raw materials, cheaper labour costs and presence across the entire

value chain gives India a competitive advantage. The FMCG market is set to treble from US$ 11.6

billion in 2003 to US$ 33.4 billion in 2015. Penetration level as well as per capita consumption in most

product categories like jams, toothpaste, skin care, hair wash etc in India is low indicating the untapped

market potential. Burgeoning Indian population, particularly the middle class and the rural segments,

presents an opportunity to makers of branded products to convert consumers to branded products.

Growth is also likely to come from consumer 'upgrading' in the matured product categories. With 200

million people expected to shift to processed and packaged food by 2010, India needs around US$ 28

billion of investment in the food-processing industry.

4

SWOT ANALYSIS OF FMCG INDUSTRY

THE TOP 10 COMPANIES IN FMCG SECTOR IN INDIA

1. Hindustan Unilever Ltd.

2. ITC Ltd

3. Nestle India

4. GCMMF (AMUL)

5. Procter & Gamble Hygiene and Health Care

Strength Weakness

Low Operational Costs

Presence of established distribution networks in

both urban and rural areas Presence of well-known

brands in FMCG sector

High consumer goods spending

Lower scope of investing in technology and

achieving economies of scale, especially in

small sectors

Low exports levels

Me-too products, which illegally

mimic the labels of the established brands

These products narrow the scope of

FMCG products in rural and semi-urban

market

Opportunities Threats

Flourishing rural market

Rising income levels, i.e. increase in purchasing

power of consumers

Large domestic market- a population of over one

billion

Export potential

High consumer goods spending

Removal of import restrictions resulting in

replacing of domestic brands

Slowdown in rural demand

Tax and regulatory structure

5

6. Dabur India

7. Cadbury India

8. Britannia Industries

9. Asian Paints

10. Marico Industries

6

INDUSTRY PROFILE

ITC LTD. previously called the Imperial Tobacco Company of India limited is one of India's foremost

private sector companies with a market capitalization US $ 45 billion and a turnover of US $ 7 billion.

ITCs aspiration to create enduring value for the nation and its stakeholders is manifest in its robust

portfolio of traditional and greenfield businesses encompassing Fast Moving Consumer Goods

(FMCG), Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, and Information

Technology. This diversified presence in the businesses of tomorrow is powered by a strategy to pursue

multiple drivers of growth based on its proven competencies, enterprise strengths and strong synergies

between its businesses. ITC was incorporated on August 24, 1910 under the name Imperial Tobacco

Company of India Limited. As the Company's ownership progressively Indianized, the name of the

Company was changed from Imperial Tobacco Company of India Limited to India Tobacco Company

Limited in 1970 and then to I.T.C. Limited in 1974. In recognition of the Company's multi-business

portfolio encompassing a wide range of businesses - Cigarettes & Tobacco, Hotels, Information

Technology, Packaging, Paperboards & Specialty Papers, Agri- business, Foods, Lifestyle Retailing,

Education & Stationery and Personal Care - the full stops in the Company's name were removed

effective September 18, 2001. The Company now stands rechristened 'ITC Limited'.

ITCs Agri-Business is one of Indias largest exporters of agricultural products. ITC is one of the

countrys biggest foreign exchange earners (US $ 3.2 billion in the last decade). The companys e-

choupal initiative is enabling Indian agriculture significantly enhance its competitiveness by

empowering Indian farmers through the power of the Internet. e- Choupal eliminates wasteful

intermediation and multiple handling. Thereby it significantly reduces transaction costs.

Today ITC Ltd. is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most

Reputable Companies by Forbes magazine and as 'India's Most Admired Company' in a survey

conducted by Fortune India magazine and Hay Group. ITC also features as one of world's largest

sustainable value creator in the consumer goods industry in a study by the Boston Consulting Group.

7

ITC has been listed among India's Most Valuable Companies by Business Today magazine. The

Company is among India's '10 Most Valuable (Company) Brands', according to a study conducted by

Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing

companies compiled by Business Week.

COMPANY HISTORY

The Companys beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was

the centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926,

by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata,

for the sum of Rs 310,000. This decision of the Company was historic in more ways than one. It was

to mark the beginning of a long and eventful journey into India's future. The Company's headquarter

building, 'Virginia House', which came up on that plot of land two years later, would go on to become

one of Kolkata's most venerated landmarks.

Though the first six decades of the Company's existence were primarily devoted to the growth and

consolidation of the Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the beginnings

of a corporate transformation that would usher in momentous changes in the life of the Company

ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for ITC's

Cigarettes business. It is today India's most sophisticated packaging house.

Year 1975: In 1975 the Company launched its Hotels business with the acquisition of a hotel in

Chennai which was rechristened 'ITC-Welcomgroup Hotel Chola'. The objective of ITC's entry into

the hotels business was rooted in the concept of creating value for the nation. ITC chose the hotels

business for its potential to earn high levels of foreign exchange, create tourism infrastructure and

8

generate large scale direct and indirect employment. Since then ITC's Hotels business has grown to

occupy a position of leadership, with over 100 owned and managed properties spread across India.

In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards Limited,

which today has become the market leader in India. Bhadrachalam Paperboards amalgamated with the

Company effective March 13, 2002 and became a Division of the Company, Bhadrachalam

Paperboards Division. In November 2002, this division merged with the Company's Tribeni Tissues

Division to form the Paperboards & Specialty Papers Division. ITC's paperboards' technology,

productivity, quality and manufacturing processes are comparable to the best in the world.

It has also made an immense contribution to the development of Sarapaka, an economically backward

area in the state of Andhra Pradesh. It is directly involved in education, environmental protection and

community development. In 2004, ITC acquired the paperboard manufacturing facility of BILT

Industrial Packaging Co. Ltd (BIPCO), near Coimbatore, Tamil Nadu. The Kovai Unit allows ITC to

improve customer service with reduced lead time and a wider product range.

ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture. Since inception,

its shares have been held by ITC, British American Tobacco and various independent shareholders in

Nepal. In August 2002, Surya Tobacco became a subsidiary of ITC Limited and its name was changed

to Surya Nepal Private Limited (Surya Nepal).

In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing company and a major

supplier of tissue paper to the cigarette industry. The merged entity was named the Tribeni Tissues

Division (TTD). To harness strategic and operational synergies, TTD was merged with the

Bhadrachalam Paperboards Division to form the Paperboards & Specialty Papers Division in

November 2002.

Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for

export of agri-commodities. The Division is today one of India's largest exporters. ITC's unique and

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now widely acknowledged e-Choupal initiative began in 2000 with soya farmers in Madhya Pradesh.

Now it extends to 10 states covering over 4 million farmers. ITC's first rural mall, christened 'Choupal

Saagar' was inaugurated in August 2004 at Sehore. On the rural retail front, 24 'Choupal Saagars' are

now operational in the 3 states of Madhya Pradesh, Maharashtra and Uttar Pradesh.

In 2000, ITC forayed into the Greeting, Gifting and Stationery products business with the launch of

Expressions range of greeting cards. A line of premium range of notebooks under brand Paperkraft

was launched in 2002. To augment its offering and to reach a wider student population, the popular

range of notebooks was launched under brand Classmate in 2003. Classmate over the years has

grown to become Indias largest notebook brand and has also increased its portfolio to occupy a greater

share of the school bag. Years 2007- 2009 saw the launch of Children Books, Slam Books, Geometry

Boxes, Pens and Pencils under the Classmate brand. In 2008, ITC repositioned the business as the

Education and Stationery Products Business and launched India's first environment friendly premium

business paper under the Paperkraft Brand. Paperkraft offers a diverse portfolio in the premium

executive stationery and office consumables segment.

Paperkraft entered new categories in the office consumable segment with the launch of Textliners,

Permanent Ink Markers and White Board Markers in 2009.

ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality

relaxed wear for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded

its range to include Wills Classic formal wear (2002) and Wills Clublife evening wear (2003). ITC

also initiated a foray into the popular segment with its men's wear brand, John Players, in 2002. In

2006, Wills Lifestyle became title partner of the country's most premier fashion event - Wills Lifestyle

India Fashion Week - that has gained recognition from buyers and retailers as the single largest B-2-B

platform for the Fashion

Design industry. To mark the occasion, ITC launched a special 'Celebration Series', taking the event

forward to consumers.

10

In 2000, ITC spun off its information technology business into a wholly owned subsidiary , ITC

Infotech India Limited, to more aggressively pursue emerging opportunities in this area. Today ITC

Infotech is one of Indias fastest growing global IT and IT-enabled services companies and has

established itself as a key player in offshore outsourcing, providing outsourced IT solutions and

services to leading global customers across key focus verticals - Manufacturing, BFSI (Banking,

Financial Services & Insurance), CPG&R (Consumer Packaged Goods & Retail), THT (Travel,

Hospitality and Transportation) and Media & Entertainment.

ITC's foray into the Foods business is an outstanding example of successfully blending multiple

internal competencies to create a new driver of business growth. It began in August 2001 with the

introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes. In 2002, ITC entered the

confectionery and staples segments with the launch of the brands mint-o and Candyman confectionery

and Aashirvaad atta (wheat flour). 2003 witnessed the introduction of Sunfeast as the Company entered

the biscuits segment. ITC's entered the fast growing branded snacks category with Bingo! I+-n 2007.

In eight years, the Foods business has grown to a significant size with over 200 differentiated products

under six distinctive brands, with an enviable distribution reach, a rapidly growing market share and a

solid market standing.

In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain

found yet another expression in the Safety Matches initiative. ITC now markets popular safety matches

brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.

ITC's foray into the marketing of Agarbattis (incense sticks) in 2003 marked the manifestation of its

partnership with the cottage sector. ITC's popular agarbattis brands include Spriha and Mangaldeep

across a range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Sambrani and

Nagchampa.

ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and bath & body care products

11

for men and women in July 2005. Inizio, the signature range under Essenza Di Wills provides a

comprehensive grooming regimen with distinct lines for men (Inizio Homme) and

Indian consumers the Company launched 'Fiama Di Wills', a premium range of Shampoos, Shower

Gels and Soaps in September, October and December 2007 respectively. The Company also launched

the 'Superia' range of Soaps and Shampoos in the mass-market segment at select markets in October

2007 and Vivel De Wills & Vivel range of soaps in February and Vivel range of shampoos in June

2008.

In 2010 ITC entered the fairness cream segment by launching product Vivel active fair.

In the year 2013 ENGAGE, Indias first range of couple deodorants

ITC Introduced kwiknic, new range of nicotine chewing gums in 2014.

ITC on February 2015 purchased from Johnson & Johnson (health and pharmaceuticals major) two of

its brands - Savlon, a brand of antiseptic soaps and liquids, and Shower to Shower, a prickly heat

powder.

ITC has entered the Fruit-based juices and beverages market with the launch of B Natural juices in

January 2015. B Natural makes great tasting juices & beverages with the goodness of fruits. The brand

believes that being healthy is a natural state, best served with great taste, fun and enjoyment.

12

COMPANY PROFILE

Vision, Mission, Core Values and Governance Policies

Vision

Sustain ITC's position as one of India's most valuable corporations through world class performance,

creating growing value for the Indian economy and the Company's stakeholders.

Mission

To enhance the wealth generating capability of the enterprise in a globalising environment, delivering

superior and sustainable stakeholder value.

Core Values

ITC's Core Values are aimed at developing a customer-focused, high-performance organisation which

creates values for all its stakeholders.

ITC's Core Values are aimed at developing a customer-focused, high-performance organisation which

creates value for all its stakeholders:

ITC is a board-managed professional company, committed to creating enduring value for the nation

and the shareholder. It has a rich organisational culture rooted in its core values of respect for people

and belief in empowerment. Its philosophy of all-round value creation is backed by strong corporate

governance policies and systems.

13

CORPORATE STRATEGY

ITCs corporate strategies are:

Create multiple drivers of growth by developing a portfolio of world class businesses that best

matches organisational capability with opportunities in domestic and export markets.

Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards & Packaging,

Agri Business and Information Technology.

Benchmark the health of each business comprehensively across the criteria of Market Standing,

Profitability and Internal Vitality.

Ensure that each of its businesses is world class and internationally competitive.

Enhance the competitive power of the portfolio through synergies derived by blending the

diverse skills and capabilities residing in ITCs various businesses.

Create distributed leadership within the organisation by nurturing talented and focused top

management teams for each of the businesses.

Continuously strengthen and refine Corporate Governance processes and systems to catalyse

the entrepreneurial energies of management by striking the golden balance between executive

freedom and the need for effective control and accountability.

CORPORATE GOVERNANCE

Over the years, ITC has evolved from a single product company to a multi-business corporation. Its

businesses are spread over a wide spectrum, ranging from cigarettes and tobacco to hotels, packaging,

paper and paperboards and international commodities trading.

Each of these businesses is vastly different from the others in its type, the state of its evolution and the

basic nature of its activity, all of which influence the choice of the form of governance. The challenge

of governance for ITC therefore lies in fashioning a model that addresses the uniqueness of each of its

businesses and yet strengthens the unity of purpose of the Company as a whole. ITC defines Corporate

14

Governance as a systemic process by which companies are directed and controlled to enhance their

wealth generating capacity. Since large corporations employ vast quantum of societal resources, we

believe that the governance process should ensure that these companies are managed in a manner that

meets stakeholders aspirations and societal expectations.

CORE PRINCIPLES

ITC's Corporate Governance initiative is based on two core principles. These are:

Management must have the executive freedom to drive the enterprise forward without undue

restraints; and this freedom of management should be exercised within a framework of

effective accountability.

ITC believes that any meaningful policy on Corporate Governance must provide

empowerment to the executive management of the Company, and simultaneously create a

mechanism of checks and balances which ensures that the decision making powers vested in

the executive management is not only not misused, but is used with care and responsibility to

meet stakeholder aspirations and societal expectations.

From the above definition and core principles of Corporate Governance emerge the cornerstones of

ITC's governance philosophy, namely trusteeship, transparency, empowerment and accountability,

control and ethical corporate citizenship. ITC believes that the practice of each of these leads to the

creation of the right corporate culture in which the company is managed in a manner that fulfils the

purpose of Corporate Governance.

15

COMPANY STRUCTURE

Flowing from the concept and principles of Corporate Governance adopted by the Company,

leadership within ITC is exercised at three levels. The Board of Directors at the apex, as trustee of

shareholders, carries the responsibility for strategic supervision of the Company. The strategic

management of the Company rests with the Corporate Management Committee comprising the whole

time Directors and members drawn from senior management. The executive management of each

business division is vested with the Divisional Management Committee (DMC), headed by the Chief

Executive. Each DMC is responsible for and totally focused on the management of its assigned

business. This three-tiered interlinked leadership process creates a wholesome balance between the

need for focus and executive freedom, and the need for supervision and control.

16

17

Marketing Department

Marketing Management Structure

ITC follows a well-structured marketing management structure which is as follows:

ITC branch works under the leadership of the branch manager. Branch Manager is required to take up

the responsibilities of all the departments such as CFP, PCP, Foods, Key A/Cs, ESPB and Finance.

CFP, PCP, Foods and ESPB come under the marketing department.

CFP CFP deals with the various cigarettes and safety match products. CFP stands for Convenience

Focus Products.

PCP PCP stands for Personal Care Products. The brands of PCP items include Vivel, Fiama Di

Wills, Essenza Di Wills, Engage, etc.

Foods Foods includes the brands of Aashirvad , Sunfeast, Yippee, etc.. Aashirvad is the market

18

leader in the atta industry and Sunfeast had hold a reasonable market share within a short span of time

period.

ESPB ESPB stands for Education Stationary Product Business and it consist of Classmate and

Paperkraft.

Key Accounts

Key accounts are separate department of employees who looks after the industry top outlets. The

outlets covered by them includes, Margin Free Super Markets, Hyper Markets, etc. Key accounts

department analyses the cash and stock movements of CFP, PCP and Foods and maintains accounts.

The marketing department for all this sections works in the same manner. Under all the departments

there will be one assistant manager then Area manager, area executives and at last sales trainees.

The employees report to their superiors in the following manner:

Sales trainees are new recruiters and they are supposed to report to the area manager.

The area executives should also report to the area manager.

The area managers are required to report to the assistant manager.

Group Companies

Surya Nepal Private Limited (SNPL): is an Indo-Nepal-UK joint venture, which started operations in

Nepal in 1986. SNPL, a subsidiary of ITC Ltd, India, is the largest private sector enterprise in Nepal.

The balance shares are held by dispersed Nepalese shareholders and British American Tobacco, UK.

ITC Info-Tech: ITC InfoTech is a fully owned subsidiary of ITC Ltd. Formed in 2000; ITC InfoTech

has today carved a niche for itself in the arena of global IT services and solutions. The company has

established technology Centers of Excellence (CoE) to deepen capabilities and incubate cutting-edge

technical competencies. A robust outsourcing model, comprehensive suite of differentiated solutions

& services and focus on excellence in execution has provided the company a leadership position in

chosen domains. With over 5600 employees, ITC InfoTech conforms to the highest standards in

process quality, with ISO 27001, ISO 9001 and CMMi Level 3 accreditations.

19

LANDBASE: Landbase India Limited, a subsidiary of ITC, owns the prestigious Classic Golf Resort

in the outskirts of Delhi. Classic Golf Resort is the first South Asian signature championship course

designed by Jack Nicklaus. Spread over 300 acres at the foothills of the picturesque Aravalli, it

comprises an 18- hole signature championship course, a nine-hole signature canyon course, a social

club and a sports complex which offers non-golfing sports and recreational activities.

King Maker Marketing INC: Established in 1994, King Maker Marketing Inc. (KMM) is a leading

supplier of premium quality, value-priced cigarettes and roll-your-own (RYO) tobacco. The company's

product lines, which include the Checkers, Hi-Val and Gold Crest, are made of 100% American Blend

tobaccos to ensure a smooth taste and consistent quality. KMM also provides market research services

relating to the US Tobacco and FMCG markets.

TECHNICO PTY LTD: Technico Pty Limited, Australia ('Technico') is an agri-biotechnology

company specializing in rapid seed potato production. Technico has developed the proprietary

TECHNITUBER technology, which involves the use of pathogen-tested tissue culture and processes

that enable the rapid multiplication of seed potatoes from pathogen-tested plants in controlled

environment.

Russell credit Limited: Russell Credit Limited is a 100% subsidiary of ITC Limited. Russell is an

Investment Company with activities primarily confined to making long-term investments in areas of

strategic thrust, namely FMCG, Hotels & Tourism, Paper, Paperboards & Packaging Agri Business

and Information Technology. Russell has one wholly owned subsidiary, Greenacre Holdings Limited,

which is engaged in property infrastructure maintenance.

20

WIMCO Limited: The acquisition of Wimco through Russell Credit Limited, a 100% subsidiary of

ITC Limited on July 1, 2005, aimed to further consolidate the market standing of ITC's Matches

business through synergy benefits of combined portfolio of offerings, improved servicing of proximal

markets and freight optimization. Subsequently Wimco became a direct subsidiary of ITC effective

29th September, 2011 when ITC acquired the entire shareholding of Wimco from Russell Credit.

Srinivasa Resorts Limited: Srinivasa Resorts Limited is a subsidiary of ITC Limited. ITC has 68%

stake in the Company. The Company owns the "ITC Kakatiya" at Hyderabad, which is operated by

ITC Limited. The Company continues to focus on hygiene, safety and environment. The Company's

Hotel, ITC Kakatiya has received various awards /recognitions, significant amongst them are the

prestigious Leadership in Energy and Environment Design (LEED) Platinum certification from the

United States Green Building Council (USGBC), 'Environment Champion Among Large Hotels' by

Federation of Hotel & Restaurant Associations of India, 'Greentech Silver Safety Award' in service

sector for outstanding achievement in safety management by Greentech Foundation, 'Certificate of

Appreciation' by Energy Conservation Mission and The Institution of Engineers (India) and 'HACCP

Certification' for Food Safety System by Det Norske Veritas. The Company's Hotel also has

implemented 'Six Sigma' quality initiatives to further enhance service edge.

Fortune Park Hotels Limited: Fortune Park Hotels Ltd. is a subsidiary of ITC Ltd. Set up in 1995 to

cater to the mid-priced market segment in business and leisure destinations; it is today a professional

Hotel Management company, with forty operating hotels and many more in various stages of

completion.

Bay Islands hotels Limited: Bay Islands Hotels Limited is a 100% subsidiary of ITC Limited. The

Company owns the hotel "Fortune Resort Bay Island" at Port Blair which is licensed to ITC Limited

and is operated by Fortune Park Hotels Limited under an Operating & Marketing Services Agreement.

Gold Flake Corporation Limited: Gold Flake Corporation Limited is wholly owned subsidiary of ITC

Limited. The Company's nature of business is specific to general trading.ITC Filtrona Limited is a

21

50% joint venture of Gold Flake Corporation Limited with Cigarette Components Limited, U.K.

JOINT VENTURE

Maharaja Heritage Resorts Limited: Maharaja Heritage Resorts Limited, where ITC Limited

has an ownership interest of 50% is a joint venture with Jodhana Heritage Resorts Private

Limited. The joint venture company currently operates across India under the

"WelcomHeritage" brand.

WelcomHeritage represents some of the best traditions of heritage hospitality and tourism in

India. It offer's 57 exclusive heritage destinations, ranging from grand palaces to traditional

havelis and magnificent forts; from adventure-filled jungle lodges to tea garden homes and

quiet nature resorts in Rajasthan, Madhya Pradesh, Uttarakhand, Himachal Pradesh, Jammu &

Kashmir, West Bengal, Karnataka, Tamil Nadu, Punjab, Haryana, Assam, Sikkim, Meghalaya,

Arunachal Pradesh, Uttar Pradesh, Maharashtra, Kerala, Andhra Pradesh and Pondicherry.

ITC Filtrona: ITC Filtrona Ltd is an equal partnership joint venture between ITC Limited and

Filtrona Plc, U.K., the world leader in filter design and development. The company is located

in Bangalore. ITC Filtrona commenced manufacturing of Acetate filter rods in 1994 and

pioneered the full changeover of the Indian market to acetate filters from viscose filters by

2000. The company has state-of-the-art technology and has the capacity of producing over 13

billion rods per annum. It enjoys over 60% market share and has played a critical role in import

substitution. ITC Filtrona brings in world-class technology to the Indian market in the form of

Acetate filter rods and Specialty filters.

22

ASSOCIATE COMPANIES

Gujarat Hotels Limited: ITC Limited holds 45.78% in Gujarat Hotels Limited. The Company owns

the "WelcomHotel Vadodara" at Vadodara which is operated by ITC Limited under an Operating

Licence Agreement. WelcomHotel Vadodara offers plush accommodation and top-of-the-line

Business, Conference and Leisure facilities tailored to the requirement of the discerning and modern

day business traveller.

International Travel House: International Travel House is one of the largest total travel management

companies in India with a presence in 13 cities. It offers a range of services which include corporate

travel, car rental, destination management services, world class holidays, incentive group travel,

conference management and foreign exchange.

COMPANY STAKEHOLDERS

ITC has adopted a multi-pronged, multi stakeholder strategy for an inclusive approach to building

partnerships in sustainable business practices. It has also put in place institutional mechanisms to

facilitate strong partnerships with communities in its programmes such as Watershed Development,

Social Forestry, Animal Husbandry Services and Womens Empowerment. These initiatives augment

the natural resource base and create sustainable rural livelihoods.

Shareholders ITC believes that protection and enhancement of shareholder wealth is one of the Companys key

responsibilities. The primary expectations of shareholders remain centred around continued

profitability and growth, effective communications and investor servicing. The Chairman addresses

and provides clarifications to shareholders at least once a year at the Annual General Meeting in the

presence of the Board. The Board encourages open dialogue with all shareholders, including

individuals, corporates and investors.

23

Customers Enduring and long-term customer relationships form the bedrock of ITCs businesses. Significant

efforts are made to gain insights into customers needs and aspirations and to seek consumer delight

through ITCs high-quality and cost competitive products and services. Most of ITCs Businesses have

various mechanisms to capture the needs and expectations of the customer, such as market surveys,

personal contacts/visits, events, customer satisfaction surveys, joint development and improvement

projects, key account management, multi-level interfaces at dealer-customer-end user, personalised

lifestyle privilege programme, etc. Robust Quality Assurance systems, supported by process

innovations, adoption of green technology, lean management, six sigma and TPM, help to achieve

benchmarks in the quality of products and services that can sustain and enhance customer delight. ITC

also continues to invest significantly in R&D to develop newer products/variants.

Employees

ITC recognises that the creation of a highquality human resource team to drive the businesses of

tomorrow requires focus on providing personal development and growth, a work culture that ensures

high levels of performance, provides world-class learning experiences and a caring & empowering

work environment. Our unique employee value proposition is backed by strong corporate equity

enabled sustained engagement in challenging times. Each business focuses on engaging employees

through communication meetings, mentoring, suggestion schemes, engagement surveys and talent

recognition programmes. ITCs remuneration philosophy recognises performance and meritocracy,

whilst remaining competitive and sustainable. The Company fosters a culture that rewards

performance, continuous learning, collaboration and capacity development across the organisation to

be future- ready and meet head-on the challenges posed by ever changing market realities. To address

employee concerns, ITC units have a structured grievance redressal mechanism to enable all

grievances to be resolved in a just and amicable manner. A grievance redressal committee, comprising

representatives of both unionised employees and managers, has been instituted to address their

concerns. ITCs unswerving belief in the mutuality of interests of key stakeholders, binds all

employees to a shared vision and purpose. ITCs units engage with employee representatives and

unions, thereby strengthening the collaborative spirit across all sections of employees.

24

Farmers Farmers are an important value chain partner for ITC and we continue to engage with them through a

large gamut of interventions. A primary cause of rural poverty is the vicious cycle of low productivity,

low income and low capacity to invest that continues to plague Indian farmers. Addressing the root

cause of these challenges, ITC co-created the e-Choupal initiative with farmers to provide information

and knowhow on agricultural best practices, transmission of market signals, transparent discovery of

prices, timely and relevant weather information, access to quality inputs, and most importantly,

efficient market access.

ITC e-CHOUPAL

The ITC e- Choupals, managed by trained farmers (sanchalaks), helped the agricultural community

access ready information in their local language. In addition, ITC worked closely with farmers to

enhance agri productivity through demonstration farms and customised extension services, apart from

creating physical infrastructure in the form of integrated rural services hubs. The ITC e-Choupal

initiative has empowered over 4 million farmers in 40,000 villages, raising rural productivity and

incomes. Similarly, ITC works closely with farmers in its Social and Farm Forestry programme to

provide a wide spectrum of extension services that impart knowledge and knowhow to farmers through

dedicated farmer training programmes. In addition, farmers have been benefitted by the extensive

R&D programme for clonal propagation which gives them high yielding quality saplings which are

disease resistant, can grow in shorter time spans and in difficult terrains such as wastelands. This

initiative has created over 64 million person days of employment for farmers in the state of Andhra

Pradesh.

25

Suppliers The Companys supplier (both national and international) engagements are supported by policies,

processes and best practices that ensure that procurement activity is conducted in an open, transparent

and non-discriminatory manner. Strong processes are in place to identify/develop and qualify vendors

on the basis of supply assurance, innovation quotient, product quality and value for money

considerations. Formal competitive processes are established and documented discussions,

recommendations and decisions underlay all procurement activity. Sole sourcing (to the extent

possible) and retroactive contracting are avoided. Contracts are tested for regulatory compliance and

supplier deliverables cognise for environmental, health and safety legislation. All businesses of the

Company have modern facilities and use state of the art technologies to ensure benchmarked quality

and value. Accordingly, the Company sources specialised production machinery from reputed

international as well as Indian manufacturers across large, medium and small scale sectors. Utility

machinery such as boilers, generator sets, air-conditioning and refrigeration machinery and electrical

& electronic systems are sourced largely from Indian or India based suppliers. Competent Indian

contractors carry out construction and renovation of new manufacturing facilities, hotels, warehouses

& offices. Nearly 90% of raw materials and 70% of spare parts and components have been locally

procured during the year. The Company actively encourages competency development among local

vendors and its vendor base includes numerous medium and small scale enterprises that are close to

its manufacturing locations. Where appropriate, vendors are provided technical support and managerial

inputs to enable them to move in tandem with the Companys business plans.

The Company also supports several vocational training initiatives in areas close to its operations. These

have been effective in empowering youth with requisite skills and increased opportunities for

entrepreneurial development. In addition, the Company has continued to set up sourcing centres in

rural India for several of its product categories, both directly and in collaboration with various State

agencies and NGOs to assist in the creation of sustainable livelihoods.

Community ITCs agri-businesses have forged a long and enduring partnership with rural communities. Their

initiatives contribute to empowering these communities to conserve and manage their natural

resources, create sustainable on and off-farm livelihoods and improve social infrastructure, especially

in areas where it impacts women and children. ITC has put in place village-level institutional

26

mechanisms which help transform rural communities into vibrant economic organisations and

empower stakeholders with enhanced incomes and livelihoods.

Government

ITC interacts through industry bodies and various other forums with Government / Regulatory

Authorities on aspects relating to public policy frameworks. ITC, in partnership with CII, has

supported the creation of a unique institution The CII-ITC Centre of Excellence for Sustainable

Development to promote thought leadership, recognise sustainability champions and build

awareness as well as capacity on issues related to sustainable development and inclusive growth.

27

ITC LTD. Project

ON

ANALYSIS OF THE COMPETITORS OF ITC LTD. IN

CHEMIST OUTLETS AND THEIR MARKETING

STRATEGIES.

28

SCOPE

The scope of the project was kept to finding the key chemist outlets within the given area of Palakkad

and Thirssur district and to generate a list of major chemist outlets. A total number of 650 chemist

outlets was selected for running the project in the districts of Trissur District and Palakkad The

information regarding the chemist outlets including the name of the shops with address, area and details

of the products sold there , merchandising activities of the competitors and remarks of the customers

were collected to do the study.

The main objectives of the project was to:

Identifying the top chemist outlets and the location.

To identify the key competitors of ITC LTD. who are serving in chemist outlets and to

understand their marketing strategies, merchandising activities, distribution practices, credit

terms and margin schemes.

Introduce the new products of ITC (Shower to Shower and Savlon Products) to the shop owner,

pharmacists, and salesman and to take sales order. Also to assess the scope of ITC products in

these shops and to identify the scope for merchandising activities.

Devise a low cost merchandising activity

As a part of my project I was able to interact with medical shop owners, pharmacists, salesman and

few medical representatives. Understanding perceptions of channel members and consumers regarding

sales promotion activities helped in enhancing the effectiveness of my study. I was able to get a lots

of information suggestions and feedbacks from them.

Detailed Study on FMCG goods and services in Chemist outlets

OTC Products in Chemist Outlets

There are several leading brands in the market who are dominant in the medical outlets like: Hindustan

Unilever, Procter & Gamble, Reckitt Benckiser, Emami Limited, Nestle, Godrej, LOreal, Wipro and

Heinz India Private Limited. Consumer goods sold through chemist outlets vary from cosmetics,

personal care products, and edibles in addition to pharmaceutical drugs.

The pie-chart shown below represents the percentage of various products sold through chemist outlets.

29

Categories of Products sold in Chemist Outlets

HUL, Reckitt Benckiser, P&G being the top competitors of ITC with wide range of their products that

poses an obstruction to tap the market and replace the products with ITC owing to the heritage and

longtime developed trust. While Emami Ltd. And Wipro have several consumer demanded products

like Chanrika, and Santoor which has developed a sync. with Kerala consumer market, recent players

like Dhathri and Indhulekha is highly successful with their personal care products.

Top brands of various poducts consumed from Chemist outlets are:

SOAPS

The leading brands in the market are Dove, Pears, Lux, Dettol, Liril, Rexona, Lifebouy, Nirma,

Palmolive and Hamam. Dove and Pears is high demanded brands of soaps. Also Dettol soaps that are

enquired by many customers over the medical shops. The demand of soap slightly changes over several

regions. Indhulekha is a recent player in the market that has captured some market share with its good

Ad-campaign. Other soaps demanded are Chandrika, Santoor and Medimix.

Product Types

Drugs OTC Goods Other Items(Recharge Coupons,Food items)

30

SHAMPOO

The top demanded shampoos are Pantene and Head & Shoulders of P&G. Also Dheedhi shampoo by

Dhatrhi Group has recently replaced P&G products to grab major share in the market with its

successful ad-campaign. There are shops selling 12 bottles of Dheedhi shampoos per month.

Shampoos are seen in bottled form and in sachet packets (70%).

Shampoos and Soaps got good scope in chemist outlets.

DEODORANT

Although Fogg is the market leader of deodorants, it is scarily available in medical outlets here in

Palakkad and Thrissur. The top displayed products in shops are AXE Signature (HUL), Kamasutra

(Raymonds), Dove, Niviea and Spinz (Cavin Care).

FACEWASH AND HANDWASH

The top demanded facewash brands are Himalaya Face Wash, Garneir, and Pears. There are customers

for Everyouth and Chandrika facewash.

Most sold handwash are Pears and Dettol followed by Chandrika and Lifebuoy.

FAIRNESS CREAM

Obviously Fair&Lovely is the market leader followed by Fair &Handsome and Ponds. There are also

other demanded products like Indhulekha, Garnier, etc.

POWDER

The top demanded prickly heat powder is Nycil Prickly Heat Powder (75-80% market share) followed

by Dermi Cool and other brands like Smyle, Shreejee Nehacil. Boro Plus is having less demand.

Top sold ordinary talc are: Cuticura, Ponds, Santoor. Other brands are Eva and Nivea.

CONFECTIONARY

Several confectionaries and candies like Polo, Milky bar (Nestle), Halls, Eladi noticeably placed in the

medical shops. Polo is available in 95% of shops and Milikybar toffee is available in around 60%

shops. Medicated cough candies available are Vicks, Strepsils and Eladi

31

The following table shows the list of the key players and major products in the chemist outlets, who

are visible in the chemist outlets:

Company Range of Products Top Brands in Outlets

1. HUL Soaps, Shampoo, Deodorants,

Skin Care, Toothpaste, Fairness

Cream, Talcum Powder.

Pears, Dove, Clinic Plus

shampoo, Hamam, Lifebuoy,

Rexona, Ponds.

2. P&G Shampoos and Hair Care ,

Fairness Cream , Vicks , Baby

diapers

Pantene, Head& Shoulders,

Vicks.

3. Reckitt Benckiser Anti-Septic Liquid, Cleaning

Liquids, Cough relief candy,

Soap, Hand wash, Prickly heat

powder.

Dettol, Strepsils, Dermi Cool.

4. Emami Ltd. Prickly heat powder and Cool

Talc, Fairness Cream, Balms.

Boro Plus, Fair & Handsome,

Navaratna.

6. Manisha Pharma Plast LTD.

(Heinz India LTD.)

Prickly Heat Powder Nycil Prickly Heat Powder

5. Himalaya Fairness Cream, Soap, Baby

Products, Drugs.

Himalaya Neem Facewash

6. Wipro Soaps, Handwash, Facewash Chandrika, Santoor

7. Dabur India Ltd. Fairness Cream, Candy, Hair

care, Food supplements

Vatika ,Hajmola , Fem

There are also other products like Medimix soap of Cholayil Group, Everyouth Facewash, Kamasutra

Deo.

Distribution and Service Patterns of Competitors:

All major competitors like HUL, P&G, and RB have a very good distribution network and weekly

enquiry system. HUL products obviously good demand and hence they have reduced the credit period

from 15 to 6 days or ready cash at most shops. The delivery is by either van supply or carried to the

shops by DS.

The following table shows the list of companies and distributors, supply and credit terms in Thrissur

and Palakkad.

32

Obviously a strong distribution network and good relation with the customer helps the business to

sustain and grow.

COMPANY KEY

DISTRIBUTORS

DISTRIBUTION

PATTERN

CREDIT TERMS REMARKS

HUL

GOOD MORNING

AGENCIES, NOOR

AGENCIES,

PALATHARA

DISTRIBUTORS.

7-15 DAYS

READY CASH/ 6-15

DAYS

Distribution is

weak in coastal

areas like

Chavakkad,

Cherai.

P & G SHABARI

AGENCIES, NEW

CHEMIST PHARMA

15 DAYS READY CASH/7

DAYS.

Customers are in

good relation

with P & G team.

RECKITT

BENCKISER

(DETTOL)

PREMSON

AGENCIES, GRACE

, NCP

7-14 Days Usually 7 DAYS

CREDIT, MAX. 30

DAYS

Highly

Demanded.

EMAMI LTD. SUB-

DISTRIBUTORS

1 MONTH 1 MONTH -

DABUR LINK LINES 1 MONTH 1 MONTH Sub Distributors

via C&F at

Ernakulam.

NYCIL GLORIA 15 Days 7 DAYS

HIMALAYA VIJAY AGENCIES

,LIN LINES

7 DAYS Min.,

USUALLY 30 - 60

DAYS.

30-60 DAYS Sub Distributors

via C&F.

NESTLE HARITHA

AGENCIES

7 Days 15 DAYS Mostly

CERLAC and

LACTOGEN.

Maggi-Noodles

and chocolates is

rarely available

in some outlets.

Godrej Sales Wings 15 DAYS 15 DAYS Customers also

depend on

Wholesalers for

Godrej Products.

Dhathri &

Indhulekha

Sub- Distributors 7-15 DAYS 15 DAYS

33

MERCHANDISING ACTIVITIES

There are several sales promotion activities in deployed in chemist outlets these which helps to also

get an insight into consumer perceptions about various brands. The method employed is merchandising

are:

Displaying of products in cabinets which is decorated by brand stickers.

Sticking of attractive product presenter posters at outlets.

Use of company provided special racks and boxes to enhance the display of products

(Gillette).

Use of attractive packaging and hanging displays for sample pack products.

P&G group Benckiser, Dabur or Himalaya are not concentrated in any forms of merchandising

activities. While Nestle uses the display of their baby food products in customers cabinets

decorated with stickers, P&G uses cabinet displays, company provided designed racks

(Gillettin) for the purpose of merchandising. P & G also uses P & G Shiksha Ad Posters as a

part of merchandising activities

Table shows informations about various merchandising activities executed by brands.

Company Merchandising

Schemes

Offers for

Merchandising

Schemes

Other Offers Remarks

HUL

-

-

Sometimes discount

are given at year

ending to clear

stocks.

HUL products are most

demanded so they are not

giving any kind of offers.

P & G Display

Counters,

Sticker

designed

cabinets(e.g.

:Pantene) ,

P&G Shiksha

Display

Company gives

upto 500/- per

month for display

of selected

products or 5-7%

discount on bills.

-

P &G is the one company that

offers good display schemes to

outlets are customers have

good impression about the

loyalty programs.

Nestle Display of

CERLAC,

LACTOGEN

and other baby

250/- , 350/- or

500/- per month

based on the

-

Nestle is not competitor of ITC

with respect to personal care

products.

34

.

Nestle Display costing 350/- per month. Nestle Display costing 500/- per month.

P & G Merchandising on Action Glucovita Bolts

foods in

customers cabinets

decorated by

company

stickers.

potential of the

shop and display.

35

Various Other Displays in Action

36

OPPORTUNITY ANALYSIS FOR ITC PRODUCTS IN

CHEMIST OUTLETS

There is a good scope for ITC products in chemist outlets. Even though such shops only sell 18-20%

consumer goods this is an ideal chanel to tap and win consumers for ITC products.

Retailers: Shop owners stated that role of word of mouth and television advertising was very important

in providing information inputs to the consumers regarding sales promotion activities while planning

sales promotion strategies. There are several customers who are interested in taking any merchandising

deals with consumer products for cash. But top players like HUL, Reckitt Benkiser, Emami or Dabur

is not promoting any such loyalty programs in these areas so giving them initial schemes or discounts

help to tap the market and to slowly enter into the business.

In fact Mr. Sujeesh (Sreeram Medicals,Peruvambu,Palakkad) told me that he will support ITC products

if more advertising comes into play and with enough enquiry . There are several shop owners who are

interested in getting display schemes and offers.

Potential for Consumer Goods:

Only less than 5% of shops sells ITC products. Most of these shops buys ITC products from

wholesalers. There is a good scope for personal care products like Fairness cream, Shampoo, Talcum

Powders, Soaps, Deodorants, Face Wash and Hand Wash in this market chanel.

For instance there are shops that sold selling 10,000/- worth P&G products per month (Sastha

Medicals, Alwaye).

The table shows the average monthly sales of various products, in two medical shops

(Thrissur&Palakkad):

37

Neethi Medicals,Aluwaye Halu Medicals,Kodupalli,Palakkad

H&S Shampoo : 3 bottles

Pantene : 3 bottles

Dettol ASL 200ml -12 no.

Dettol ASL 500 6 no.

Dettol ASL 110-8 no.

Dettol ASL 60 -5 no.

Dettol soap 75gm - 10 no.

Nycil powder -12-14 units

Fair and Lovley Fariness Cream : 30 units

Fair and Handsome : 20 units

Dove Soap : 5-6 dozen

Pears Soap : 5-6 dozen

Face wash (all ) : 100 units

Himalaya Face Wash : 15-20 units

Dettol Hand Wash : 4units

Lifebuoy Hand Wash : 4units

Dheedhi shampoo: 10-12 Bottles

So, we can conclude that the scope for cosmetics and personal care products in chemist oulets is huge.

People are driven by advertisements and its effectiveness to communicate the value to the customer,

brand endorsements (The advertisement of Dheedhi shampoo with cine artist Ms.Manju Warrier

helped the brand to quickly get consumers attention and choice of shampoo.

19%

2%

20%47%

10% 2%

Pie Chart showing avrage sales of PCP products in a chemist outlet

Shampoo

Powder

Fairness Cream

Toilet Soaps

Face Wash

Hand Wash

38

CONCLUSION

Learnings:

There is a good scope for ITC products with a good regular enquiry and establishing good

relations with the customers.

Medical shop owners are always attracted to good schemes and loyalty programs. A strong

enquiry helps the company to remind the customers about the brand and the products

periodically.

Proper advertising and promotion helps to develop a brand.

Since Shower to Shower got a heritage it still has got good demand as I was able to place more

Suggestions and Ideas

There a still consumers who have used or knows Salvon products and has a good image about

savlon products. This is a great advantage to tap into chemist outlets under this portfolio and

enlarge our services.

Giving a push to the salesmen and owner at chemist outlets and by informing them about the

right usage and relevance of Savlon products will be a good idea. In fact a consumer at an outlet

told me that Savlon products has no stinging effect (though its a USP) so the consumer believes

that it is less effective.

The trend in marketing is Ayurvedic and 100% Safe labelled products. Such a product can be

developed in future and tap Ayurvedic drug outlets also. There are several Ayurvedic drug

shops in Palakkad and Thrissur like Sitaram Pharmacy, Nagarjuna who sells Himalaya and

Dabur products. ITC can slowly tap to such markets by introducing more ayurvedic products

like Vivel ayurvedic soap.

There are several top brands like Complan, Boost, Nestle Cerlac, who are market leaders in

their segments. ITC can eventually develop such products.

Feedback from Chemist outlets:

Shower to shower has demand. Dettol, Pears is the demanded soap.

There was poor enquiry from Savlon team so shops are also not interested in pushing savlon

products.

ITC is known to most shop owners in the name of VIVEL brand name.

39

MERCHANDISING ACTIVITY

The mock-up merchandising activity planned to deploy was display of free sample of Shower to

Shower at the counter near the payment area of the shop: Geetha Medicals, Thrissur. Shelf display by

taking to the owner of the shop, Mr.Sunil. The shelf was placed in the very catchy area of the shop

where the procuct had visibility from the road and from every point of the shop. Also I placed the

sample counter where the customers can use free sample that would help to think of Shower to Shower

brand as a choice.

40

MERCHANDISING OF ITC PERSONAL CARE PRODUCTS IN CHEMIST

OUTLETS

A second project is running that is aimed in merchandising of personal crae products of ITC

Ltd. in 30 chemist outlets where the ITC is already serving. The effectiveness of the

merchandising is to be monitored after two weeks by comparing the sell-out value of the

personal care products from the selected shops. The main brands that are targeted in

deploying merchandising activity are:

Fiama Di Wills

Vivel Range of beauty products

Engage Deodorants.

The techniques employed in merchandising activities are:

Product presenters (in the form of counter top displays)

Hanging displays

Parasite Dispenser units

Shelve displays and

Posters

41

CONCLUSION

FMCG industry is the fastest moving industry in developing countries. Global consumer product

groups eyeing inorganic growth opportunities in emerging markets like India. Quite a number of

people of India are dependent on the FMCG products for their day to day operations. Its principal

constituents are Household Care, Personal Care and Food & Beverages. FMCG Industry is one of the

few industries which have showed a positive growth even in the time of recession. The year 2016-17

is likely to be a very positive year for the FMCG industry as a whole. Despite rising commodity prices,

which will continue to put pressure on performance, we can expect demand to continue to be robust

especially from rural India which is seeing rising income levels and greater propensity to spend. Some

of the merits of this industry are low operational cost, distribution networks, presence of renowned

FMCG companies, and population growth. There is a huge potential for sales of PCP products in Indian

market. So tapping of every channels and improving the distribution practices and consumer loyalty

programs plays huge importance in building the brand and sustaining the business. In fact chemist

outlets is a good channel for sales of FMCG goods in countries like India. About 5-7% FMCG products

are sold as OTC products through chemist outlets. Merchandising activities and loyalty programs plays

huge importance in influencing the purchase behaviour of the consumers. Such programs may directly

or indirectly affect the brand image and brand equity.

42

Bibliography

References:

http://www.itcportal.com/

http://www.itcportal.com/abou

itc/profile/index.aspxhttp://www.moneycontrol.com/india/stockpricequote/cigarettes/itc/ITC