Distribution system of P&G
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P&G is the world's largest consumer goods company and operates in India through subsidiaries. To strengthen its presence in India and increase sales 20-fold by 2015, P&G India launched "Project 2-3-4" aiming to double users, triple spending per user, and quadruple net sales. P&G distributes products through a limited number of large distributors to extend reach across India in an efficient and high-volume manner.
Distribution system of P&G
- 1. Case study on P & G Prasad Kumar Nayak 7207378840
- 2. Introduction to P & G • P & G India is the subsidiary of world’s largest consumer goods company Procter & Gamble . • It is ranked 86 in the 2012 fortune 500 list with a revenue of $ 82.5 billion. • P&G India is one of the largest and amongst the fastest growing consumer goods companies in India. • It was established in 1964, • P&G India now serves over 650 million consumers across India.
- 3. P & G India Products • The various brands are Vicks, Ariel, Tide, Whisper, Olay, Gillette, Ambipur, Pampers, Pantene, Oral-B, Head & Shoulders, Wella and Duracell.
- 4. Introduction to P & G Its presence pans across the Beauty & Grooming segment, the Household Care segment as well as the Health & Well Being segment. P&G operates under three entities in India - two listed entities 1. “Procter & Gamble Hygiene and Health Care Limited” and 2. ‘Gillette India Limited’, as well as one 100% subsidiary of the parent company in the U.S. called 3. ‘Procter & Gamble Home Products’.
- 5. Introduction to P & G Now it has a direct reach of 1.3 million outlets across India. At present, India is one of the smallest markets for P&G with just $1-billion sales across three subsidiaries -Procter & Gamble Health & Hygiene, Gillette India and Procter & Gamble Home Products P & G currently invested in the country via its five plants and over nine contract manufacturing sites It creates 26,000 jobs directly and indirectly. Procter & Gamble, will build its largest manufacturing plant in the Indian sub-continent in Hyderabad by investing 345 crore.
- 6. Project 2-3-4 To strengthen its presence in India, and increase sales 20 times from its current $ 1b level, P&G India has formulated a 'Project 2-3-4'. P&G's 'Project 2-3-4,' is aimed at 2:doubling the number of Indians who use its products, 3:trebling per capita spending by Indians on its products and 4:quadrupling net sales of its India operations by 2015.
- 7. Why Project 2-3-4 • P & G is an organisation which traditionally deriving its bread and butter from premium brands, and from developed market. 2009 Sales by Geographical Region Developing market 22% North East Asia North America 4% 44% Western Europe 30% Sources-Economic times
- 8. • Globally and within India, the company is investing heavily in innovation, R&D and distribution. The strategy is to make several of its billion dollar brands more localised, accessible and affordable for consumers. • The company is trying to strengthen its portfolio by bringing many more brands into the country. • The parent company also plans to launch toothpaste brands Crest and Oral B in emerging markets, including India by 2015. • P & G is trying to cater the gaps in its Indian portfolio include toothpaste (a 3,000 crore market) and soaps ( 7,000 crore).
- 11. “Thank You, Mom” Campaign P&G's corporate campaign kicked off in April with its first ``Thank You, Mom'' TV spot. It also has a dedicated ``Thank, You Mom'' Facebook page and app that allows people to send ``Thank you'' messages to their mothers. P&G is sponsoring more than 150 global athletes. P&G is sponsoring a few athletes like boxer Mary Kom and runner Kavita Raut, giving their mothers a chance to see them perform and hopefully win at London this year. P&G expects the campaign to drive $500 million in sales.
- 12. 1. Analyze the sales and Distribution System of P&G? P&G keeping broaden the market by slashing it’s no. of distributors down to one-tenth of it’s size . 85% of it’s sales come from the top 30 towns & it’s current volume did not justify a large distributor network. So P&G will now have one distributer who will operate like superstockist., which help to replenish it’s distributors more frequently and reduce their average stock level. P&G keep growing on ROI(Return On Investment) which resulted in each distributer trying to extend it’s reach to push up volumes.
- 13. With a limited number of distributers, P&G will also not need to invest in C&F agents. P & G follows wholesale format of distribution for Vicks. P&G is giving 6% margin to the distributor P & G is spending 30-35 % of its sales in Advertisement and Promotion which is highest in the industry, HUL expends only 15% of sales on Advertisement and Promotion.
- 14. Distribution network of FMCG:- • MANUFACTER PLANT C/F DISTRIBUTOR OUTLETS/ SHOPS END CONSUMER/ USER
- 15. Distributor network of automobile FACTORY DEALER CONSUMER
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