ITC

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- STUDY OF WD

INFRASTRUCTURE &

- HOW TO REDUCE TURN AROUND

TIME FOR ITC WSP VEHICLE

IIP-INDUSTRY INTERNSHIP PROGRAMME REPORT

ORGANIZATION

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MASTER OF BUSINESS ADMINISTRATION

INDUSTRY INTERNSHIP PROGRAMME (IIP)

Study on Study on ITC ltd. ITC ltd. Hyderabad Hyderabad Submitted by Submitted by K. Aravind K. Aravind 16010121135 16010121135

In partial fulfilment of the Course-

In partial fulfilment of the Course- Industry Internship ProgrammeIndustry Internship Programme – – IIP IIP in Semester II of the Master of Business Administration (Batch of July 2016-18 in Semester II of the Master of Business Administration (Batch of July 2016-18 ))

Under the Guidance of Under the Guidance of Prof. N. Arun Kumar Prof. N. Arun Kumar (Associate professor) (Associate professor)

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DECLARATION

This is to declare that

This is to declare that the report titledthe report titled ““Study of WD Infrastructure & How to Study of WD Infrastructure & How to Reduce Turnaround Time (TAT)Reduce Turnaround Time (TAT) for ITC WSP

for ITC WSP vehicle”vehicle” has been made for the partial fulfilment of the Course: Industry Internship Programme has been made for the partial fulfilment of the Course: Industry Internship Programme (IIP) in Semester II by me at

(IIP) in Semester II by me at ITC ltd.ITC ltd. under the guidance of under the guidance of Mr. Marisetty NagaSaiMr. Marisetty NagaSai as Industry Guide &as Industry Guide & Prof. N.Prof. N. Arun Kumar

Arun Kumar as faculty guide.as faculty guide.

I confirm that this report truly represents my work undertaken as

I confirm that this report truly represents my work undertaken as a part of my Industry Internship Programmea part of my Industry Internship Programme (IIP). This work is not

(IIP). This work is not a replication of work done previously by any a replication of work done previously by any other person. I also confirm that the other person. I also confirm that the contentscontents of the report and the views contained therein have been

of the report and the views contained therein have been discussed and deliberated with the faculty guide.discussed and deliberated with the faculty guide.

Signature of the Student: Signature of the Student:

Name of the Student:

Name of the Student: K. ARAVINDK. ARAVIND

Registration No:

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CERTIFICATE

This is to certify that

This is to certify that Mr. K. ARAVINDMr. K. ARAVIND, Registration. No., Registration. No.1601012113516010121135 has completed the has completed the report titledreport titled ““StudyStudy of WD Infrastructure & How to Reduce Turnaround Time (TAT) for WSP vehicle

of WD Infrastructure & How to Reduce Turnaround Time (TAT) for WSP vehicle under my guidance for theunder my guidance for the partial fulfilment of the Course:

partial fulfilment of the Course: Industry Internship Programme (IIP) in Semester II of the Master of BusinessIndustry Internship Programme (IIP) in Semester II of the Master of Business Administration.

Administration.

Signature of Industry Guide & Date: Signature of Industry Guide & Date:

Name of the Industry Guide:

Name of the Industry Guide: MrMr.. Marisetty NagasaiMarisetty Nagasai

Signature of Faculty Guide & Date: Signature of Faculty Guide & Date:

Name of the Faculty Guide:

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1. EXECUTIVE SUMMARY

This report is about my internship program with ITC Ltd under the ware house and logistics management This report is about my internship program with ITC Ltd under the ware house and logistics management division. In this comprehensive report, I have discussed about WD Infrastructure and Logistics division in ITC division. In this comprehensive report, I have discussed about WD Infrastructure and Logistics division in ITC ltd which I have observed and perceived during my internship. The logistic industry is said to be the blood of ltd which I have observed and perceived during my internship. The logistic industry is said to be the blood of any company without which it will be very difficult for any company to function. For Instance, the simple any company without which it will be very difficult for any company to function. For Instance, the simple example that can be given

example that can be given is that if the required good is that if the required good doesn’t reach the customerdoesn’t reach the customer on time, then the businesson time, then the business will be considered to be a flop business in this place logistics comes into picture. The warehouse is basically a will be considered to be a flop business in this place logistics comes into picture. The warehouse is basically a place where the goods are kept for storage. Warehouse provides a central location for receiving, storing and place where the goods are kept for storage. Warehouse provides a central location for receiving, storing and distributing products. Warehousing can be classified into Outbound and Inbound logistics. Inbound logistics distributing products. Warehousing can be classified into Outbound and Inbound logistics. Inbound logistics function prepares the goods for

function prepares the goods for storage whereas Outbound Logistics consolidate, pack and ship orders storage whereas Outbound Logistics consolidate, pack and ship orders provideprovide economic and service benefits to both the business and

economic and service benefits to both the business and customers on the whole.customers on the whole.

During my internship program, by visiting each WD (Wholesale distribution) point and studying the During my internship program, by visiting each WD (Wholesale distribution) point and studying the infrastructure of each WD point regarding the

infrastructure of each WD point regarding the details of WD manpower, details about sales force automationdetails of WD manpower, details about sales force automation and vehicle Planning, parking place and allotment of Stocks, Placement of DND Goods, Number of Docks and vehicle Planning, parking place and allotment of Stocks, Placement of DND Goods, Number of Docks Available, Number of Work Units involved in Unloading and loading of the vehicle. To Calculate turnaround Available, Number of Work Units involved in Unloading and loading of the vehicle. To Calculate turnaround time (TAT) of the ITC vehicle which

time (TAT) of the ITC vehicle which visits the certain WD points in the city from WSP visits the certain WD points in the city from WSP and by taking some sampleand by taking some sample WD centres across Hyderabad and secunderabad and suggest the better alternatives on how to reduce the WD centres across Hyderabad and secunderabad and suggest the better alternatives on how to reduce the turnaround time (TAT) for WSP vehicle. The Methodology followed in acquiring the data from some WD

turnaround time (TAT) for WSP vehicle. The Methodology followed in acquiring the data from some WD pointspoints is through Observational Method at the WD points and through Face to Face

is through Observational Method at the WD points and through Face to Face Interview with the couple of workInterview with the couple of work units and WD Area Executive. Expected learning outcome f

units and WD Area Executive. Expected learning outcome from this project is chance of interacting to the workrom this project is chance of interacting to the work units and the practicality of how Warehouse works. I had worked with the various WD Area Executives. The units and the practicality of how Warehouse works. I had worked with the various WD Area Executives. The details about this team and the department will be mentioned in the report as well.

details about this team and the department will be mentioned in the report as well. As the main purpose of the

As the main purpose of the internship is to learn from the practical environment and also apply the theoreticalinternship is to learn from the practical environment and also apply the theoretical concepts in a real-world scenario in order to tackle the problems using the knowledge and skills acquired concepts in a real-world scenario in order to tackle the problems using the knowledge and skills acquired during the course done in Alliance University, in this report the analysis of current situation of the company during the course done in Alliance University, in this report the analysis of current situation of the company and its standing in the industry for the

and its standing in the industry for the particular division will be shown. This particular division will be shown. This internship report will also coverinternship report will also cover the aspects of Logistics and warehouse Department in general ITC ltd. and in the aspects of the company that the aspects of Logistics and warehouse Department in general ITC ltd. and in the aspects of the company that I had worked for.

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2.INTRODUCTION

INTERNSHIP OBJECTIVES:

The reason I choose to join ITC Ltd and the Warehouse and Logistics Division is majorly to experience the The reason I choose to join ITC Ltd and the Warehouse and Logistics Division is majorly to experience the various Operations Concepts and to know the

various Operations Concepts and to know the Working of Warehouse Management Techniques followed andWorking of Warehouse Management Techniques followed and used by the company. I wanted a new challenge and to learn, improve, and develop new set of skills. During used by the company. I wanted a new challenge and to learn, improve, and develop new set of skills. During my internship, two major competencies were central:

my internship, two major competencies were central:



 Study of WD InfrastructureStudy of WD Infrastructure: - studying the infrastructure of each WD point regarding the details of: - studying the infrastructure of each WD point regarding the details of WD manpower, details about sales force automation and vehicle Planning, parking place and allotment WD manpower, details about sales force automation and vehicle Planning, parking place and allotment of Stocks, Shipment Planning, Placement of DND Goods, Number of Docks

of Stocks, Shipment Planning, Placement of DND Goods, Number of Docks Available, Number of WorkAvailable, Number of Work Units involved in Unloading and loading of the vehicle.

Units involved in Unloading and loading of the vehicle. Which are involved in Channel Design of SalesWhich are involved in Channel Design of Sales and Distribution of ITC.

and Distribution of ITC. 

 Reducing the Turnaround Time of ITSReducing the Turnaround Time of ITS – – WSP vehicle: - WSP vehicle: -by calculating the operating time for Unloadingby calculating the operating time for Unloading the WSP vehicle at various WD points with the involvement of Work units. Proper Suggestions made the WSP vehicle at various WD points with the involvement of Work units. Proper Suggestions made by following the Time study

by following the Time study 

 Procedure of Time Study: -Procedure of Time Study:

- Identifying the job to be timed and operations to be timed.Identifying the job to be timed and operations to be timed.  Select worker for studySelect worker for study

 Collecting the equipment and arrange machinery required to conduct time study andCollecting the equipment and arrange machinery required to conduct time study and

ensure accuracy in recording time ensure accuracy in recording time

 Explaining to the worker the improved working procedure and use of Explaining to the worker the improved working procedure and use of tools and fixturestools and fixtures  Breaking the job into operations and operations into elements and writing them in aBreaking the job into operations and operations into elements and writing them in a

proper format proper format

 Conducting the observations and recording them on the time study formConducting the observations and recording them on the time study form  Rating the performance of the workerRating the performance of the worker

The beneficiary part for the ITC with this project is, there are four Shifts for shipment logistics maintained at The beneficiary part for the ITC with this project is, there are four Shifts for shipment logistics maintained at

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These shift timings would be These shift timings would be

i.

i. 2:00AM to 8:00AM2:00AM to 8:00AM ii.

ii. 8:00AM to 2:00PM8:00AM to 2:00PM iii.

iii. 2:00PM to 8:00PM2:00PM to 8:00PM iv.

iv. 8:00PM to 2:00AM8:00PM to 2:00AM Here by 2:00PM

Here by 2:00PM WSP vehicle should reach to Warehouse start the next shift of WSP vehicle should reach to Warehouse start the next shift of shipment, but at most the WDshipment, but at most the WD points unloading of this vehicle is

points unloading of this vehicle is getting late due to that WSP vegetting late due to that WSP vehicle is reaching to warehouse around 2:30hicle is reaching to warehouse around 2:30PMPM to 3:00Pm. In fact, there are some cases where

to 3:00Pm. In fact, there are some cases where it is reaching near to 4:00PM, due to this delay at one Stop ofit is reaching near to 4:00PM, due to this delay at one Stop of shift it is effecting further shift shipments all the

shift it is effecting further shift shipments all the day long. So, day long. So, by calculating the turnaround time and makingby calculating the turnaround time and making some suggestions in overcoming the delay helps in better operations at Warehouse and study of WD some suggestions in overcoming the delay helps in better operations at Warehouse and study of WD infrastructure also plays a role in

infrastructure also plays a role in calculating Turnaround timecalculating Turnaround time These are some of the important WD Points where WSP rece

These are some of the important WD Points where WSP receives higher order from: -ives higher order from: -1.

1. Shanmuganand & SonsShanmuganand & Sons 2.

2. Kumarvelu BrothersKumarvelu Brothers 3.

3. Shree Khiwaj TradersShree Khiwaj Traders 4.

4. TKM AgencyTKM Agency 5.

5. Sri Vishnu Franchiser Private limitedSri Vishnu Franchiser Private limited 6.

6. Sri Vari AssociatesSri Vari Associates 7.

7. MRL Trading CompanyMRL Trading Company 8.

8. Advanced Technology ServicesAdvanced Technology Services 9.

9. Sree Ventakeshwara AssociatesSree Ventakeshwara Associates 10.

10. DE- Spaark AgenciesDE- Spaark Agencies 11.

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2.1 INDUSTRY OVERVIEW



GLOBAL SCENARIO

As the foods business division of ITC Ltd exports its goods to key geographies such as North America, Africa, As the foods business division of ITC Ltd exports its goods to key geographies such as North America, Africa, Middle east and Australia, talking about the global scenario for the

Middle east and Australia, talking about the global scenario for the ITC is a necessity in this report. ITC is a necessity in this report. In the globalIn the global scenario, there has been a less increase in the operating margin of some of the biggest firms in the scenario, there has been a less increase in the operating margin of some of the biggest firms in the industry.

industry. Fast-moving consumer goods aFast-moving consumer goods are the goods that are traded very frequently leading re the goods that are traded very frequently leading to high volume,to high volume, low price because of repeated purchases and are fastest to leave the supermarket or hypermarket shelves. It low price because of repeated purchases and are fastest to leave the supermarket or hypermarket shelves. It is a market that is highly sensitive to changes in disposable income or in other words, very demand elastic. is a market that is highly sensitive to changes in disposable income or in other words, very demand elastic. They may be categorized as durable and non-durable when classified according to their shelf life such as They may be categorized as durable and non-durable when classified according to their shelf life such as detergents, cosmetics, packaged foods, personal hygiene products, stationery, toiletries etc. Some of the detergents, cosmetics, packaged foods, personal hygiene products, stationery, toiletries etc. Some of the management executives of big FMCG brands expect the supplier price to soar in the coming time periods but management executives of big FMCG brands expect the supplier price to soar in the coming time periods but 22% of them choose to remain on the risk averse side expecting no change to occur. The optimistic ones are 22% of them choose to remain on the risk averse side expecting no change to occur. The optimistic ones are leaving no stones unturned and are striving to

leaving no stones unturned and are striving to introduce new launches in the market to tap introduce new launches in the market to tap more of the nichemore of the niche customers, spending more on capital goods to enhance manufacturing capabilities and henceforth drive the customers, spending more on capital goods to enhance manufacturing capabilities and henceforth drive the forecast of continuous growth prospects in the FMCG industry.

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

INDIAN OPERATIONS AND MARKET SHARE OF ITC

.

ITC is one of India's foremost private sector companies with a market capitalization of nearly US $ 14 ITC is one of India's foremost private sector companies with a market capitalization of nearly US $ 14 billion and a turnover of over US $ 9.4 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab billion and a turnover of over US $ 9.4 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by Business World and among India's Most Valuable Companies by Business Today. ITC ranks Companies by Business World and among India's Most Valuable Companies by Business Today. ITC ranks among India's `10 Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by among India's `10 Most Valuable (Company) Brands', in 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. the Economic Times. ITC also ranks among Asia's 50 best performing companies compiled by Business Week. ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one

ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggestof the country's biggest foreign exchange earners (US $ 3.2

foreign exchange earners (US $ 3.2 billion in the last decade).billion in the last decade). The Company's 'e-Choupal' initiative is

The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness byenabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet. This transformational strategy, which has empowering Indian farmers through the power of the Internet. This transformational strategy, which has already become the subject matter of a case study at Harvard Business School, is expected to progressively already become the subject matter of a case study at Harvard Business School, is expected to progressively create for ITC

create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach.a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach. ITC will set up a new tobacco processing department (TPD)because the increased production will make it ITC will set up a new tobacco processing department (TPD)because the increased production will make it economical to process tobacco on site. The Company has launched a project e-Choupal in Bhopal to economical to process tobacco on site. The Company has launched a project e-Choupal in Bhopal to Web-enable farmers to make a

enable farmers to make a beginning in agricultural e-trade. ITC Ltd beginning in agricultural e-trade. ITC Ltd its entry into retailing business by launchingits entry into retailing business by launching branded leisurewear apparels as part of its diversification strategy into new areas. The Company is hiving off branded leisurewear apparels as part of its diversification strategy into new areas. The Company is hiving off its Infotech services businesses in India, the US and UK and merging them into a separate wholly-owned its Infotech services businesses in India, the US and UK and merging them into a separate wholly-owned subsidiary. The IT division has entered into agreements with Compaq and expand the IT business.

subsidiary. The IT division has entered into agreements with Compaq and expand the IT business.

GLOBALISATION AT A GLANCE



Contribution of more than US$ 2 billion to India's exports in the last decade.



ITC's International Business Division is one of the largest Indian exporters of

Agri-prod

Agri-products and is

ucts and is a preferred supply chain partner to

a preferred supply chain partner to compan

companies like

ies like Coca

Coca

Cola, Mitsubishi etc.



Markets its own brand of cigarettes in the US and Middle East



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The company set up the Lifestyle Retailing Business Division. A strategic Business Unit for the greeting cards The company set up the Lifestyle Retailing Business Division. A strategic Business Unit for the greeting cards business was set up under the Packaging and Printing Division. - ITC has launched Wills Sport, a full range of business was set up under the Packaging and Printing Division. - ITC has launched Wills Sport, a full range of internationally styled premium wear

internationally styled premium wear for men and for men and women. women. - ITC - ITC Infotech Ltd., the Infotech Ltd., the recently-launched itrecently-launched it subsidiary of ITC Ltd., has become one of the select software organisations in the world to achieve the subsidiary of ITC Ltd., has become one of the select software organisations in the world to achieve the distinction of being certified atLevel-5on the prestigious Capability Maturity Model. Tobacco Company ITC distinction of being certified atLevel-5on the prestigious Capability Maturity Model. Tobacco Company ITC launched a website, billed as `one stop terminus' for international customers of agricultural launched a website, billed as `one stop terminus' for international customers of agricultural commodities. The website, ww.itcibd.com, will provide information on trading of key commodities.

commodities. The website, ww.itcibd.com, will provide information on trading of key commodities. – – The The Company have set up units in the north-eastern States to avail of special incentives relating to Central excise Company have set up units in the north-eastern States to avail of special incentives relating to Central excise duties. As the foods business division of ITC Ltd exports its goods to key geographies such as North America, duties. As the foods business division of ITC Ltd exports its goods to key geographies such as North America, Africa, Middle east and Australia, talking about the global scenario for

Africa, Middle east and Australia, talking about the global scenario for the FMCG industry is a nthe FMCG industry is a necessity in thisecessity in this report. In the global scenario, there has been a less increase in the operating margin of some of the biggest report. In the global scenario, there has been a less increase in the operating margin of some of the biggest firms in the industry.

firms in the industry.

Fast-moving consumer goods are the goods that are traded very

Fast-moving consumer goods are the goods that are traded very frequently leading to high volume, low pricefrequently leading to high volume, low price because of repeated purchases and

because of repeated purchases and are fastest to leave the supermarket or hyare fastest to leave the supermarket or hypermarket shelves. It is a marketpermarket shelves. It is a market that is highly sensitive to changes in disposable income or in other words, very demand elastic. They may be that is highly sensitive to changes in disposable income or in other words, very demand elastic. They may be categorized as durable and non-durable when classified according to their shelf life such as detergents, categorized as durable and non-durable when classified according to their shelf life such as detergents, cosmetics, packaged foods, personal hygiene products, stationery, toiletries etc. Packaging and branding is cosmetics, packaged foods, personal hygiene products, stationery, toiletries etc. Packaging and branding is imperative to the FMCG products as it is an important element for positioning the product correctly in the imperative to the FMCG products as it is an important element for positioning the product correctly in the minds of the buyer.

minds of the buyer. It signifies the social and economic It signifies the social and economic status of the buyer and gives hstatus of the buyer and gives him something to relateim something to relate to.

to. The market for FMCG products can be safely assumed to be stable in countries where there are no severeThe market for FMCG products can be safely assumed to be stable in countries where there are no severe fluctuations in the per capita disposable incomes. These can be provided only for

fluctuations in the per capita disposable incomes. These can be provided only for highly developed nations likehighly developed nations like the UK and the US

the UK and the US and these are expected to emerge as prominent targets for the same reasons.and these are expected to emerge as prominent targets for the same reasons. The following are the trends that are followed in the

The following are the trends that are followed in the FMCG industry:FMCG industry:

1. 1. ALIGN PORTFOLIO FOR

ALIGN PORTFOLIO FOR GROWTH:

GROWTH:

3G’s budgeting may have peaked interest throughout the industry, but copycat cost cutting is not

3G’s budgeting may have peaked interest throughout the industry, but copycat cost cutting is not necessarilynecessarily an effective growth strategy. Instead of making cuts across all brands to reduce costs, analyse your portfolio an effective growth strategy. Instead of making cuts across all brands to reduce costs, analyse your portfolio to see whether it is

to see whether it is coherent. In other words, ask whether the products you offer align coherent. In other words, ask whether the products you offer align logically with the marketlogically with the market categories and niches your company is

categories and niches your company is focusing on. By identifying the rationale behind your focusing on. By identifying the rationale behind your portfolio, you canportfolio, you can avoid reacting opportunistically to changing markets wi

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2. 2. PAY ATTENTION TO SMALL BRANDS THAT DELIVER BIG:

PAY ATTENTION TO SMALL BRANDS THAT DELIVER BIG:

Small players

Small players —— those with annual sales of those with annual sales of less than $1 billionless than $1 billion —— are outperforming the competition in are outperforming the competition in 18 of18 of the top 25 categories, including the largest and most consolidated, such as dairy, bakery, snacks, and ready the top 25 categories, including the largest and most consolidated, such as dairy, bakery, snacks, and ready meals. Consumers choose these brands because they offer

meals. Consumers choose these brands because they offer authenticity (The Body Shop), a connection to localauthenticity (The Body Shop), a connection to local growers (Cabot Creamery), the promise of h

growers (Cabot Creamery), the promise of healthy ingredients (ealthy ingredients ( Bob’s Red Mill and Annie’s HomeBob’s Red Mill and Annie’s Home grown), or a grown), or a quirky story (Ben & Jerry’s). From 2009

quirky story (Ben & Jerry’s). From 2009 to 2012 in packaged foods and from 2008 to 2012 in packaged foods and from 2008 to 2011 in beverages, smallto 2011 in beverages, small players grew revenue about three times as fast as the overall category. Specifically, in packaged foods, small players grew revenue about three times as fast as the overall category. Specifically, in packaged foods, small players gained 1.7 percent of market share, while large players saw their m

players gained 1.7 percent of market share, while large players saw their market share decline 0.7 percent.arket share decline 0.7 percent.

3. 3. THINK GLOBAL ACT LOCAL (GLOBALIZATION):

THINK GLOBAL ACT LOCAL (GLOBALIZATION):

A “one

A “one-size-fits--size-fits-all” approach will no longer work in all” approach will no longer work in the global market. Brands that want to do well in emethe global market. Brands that want to do well in eme rgingrging economies in Asia, Latin America, and the Middle East, where demographic trends offer more potential for economies in Asia, Latin America, and the Middle East, where demographic trends offer more potential for growth than developed markets, must tailor

growth than developed markets, must tailor their products to local detheir products to local demands.mands. Take, for example, the challengesTake, for example, the challenges

of local distribution, especially in

of local distribution, especially in countries with large rural areas, such as India countries with large rural areas, such as India and Vietnam. Colgate sells itsand Vietnam. Colgate sells its

oral care and household products to more than half of the

oral care and household products to more than half of the world’s poworld’s population (65 percent globalpulation (65 percent global penetrationpenetration in in

2013, according to Kantar World

2013, according to Kantar World Panel’s Brand Footprint ranking) because it has built Panel’s Brand Footprint ranking) because it has built awareness and sales inawareness and sales in

emerging nations with small pack sizes, which encourage trial and are more affordable. Heinz tackles

distribution challenges by acquiring and expanding existing

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4. 4. INDIAN SCENARIO:

INDIAN SCENARIO:

A. A. EVOLUTION OF THE INDIAN FMCG SECTOR:

EVOLUTION OF THE INDIAN FMCG SECTOR:

1.

1. FMCG is the 4FMCG is the 4thth_{largest sector in the Indian economy}_{largest sector in the Indian economy}

2.

2. Household and Personal care is the leading segment accounting, accounting for 50% of the overallHousehold and Personal care is the leading segment accounting, accounting for 50% of the overall market. Hair care (23%) & Food & Beverages

market. Hair care (23%) & Food & Beverages (19%) comes next in terms of market share(19%) comes next in terms of market share 3.

3. Growing awareness, easier access & changing lifestyles have been the key growth drivers for the sectorGrowing awareness, easier access & changing lifestyles have been the key growth drivers for the sector 4.

4. Retail market in India is estimated to reach USD1 trillion by 2020 from USD600 billion in 2015, withRetail market in India is estimated to reach USD1 trillion by 2020 from USD600 billion in 2015, with modern trade expected to grow at 20 per cent per annum, which is likely to boost revenues of FMCG modern trade expected to grow at 20 per cent per annum, which is likely to boost revenues of FMCG companies

companies 5.

5. People are gracefully embracing Ayurveda products, which has resulted in growth of FMCG major,People are gracefully embracing Ayurveda products, which has resulted in growth of FMCG major, Patanjali Ayurveda, with a m-cap of USD 14.94 billion. The company aims to expand globally in the next Patanjali Ayurveda, with a m-cap of USD 14.94 billion. The company aims to expand globally in the next 5 to 10 years.

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B.

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C. C. MARKET SEGMENTS:

MARKET SEGMENTS:

As shown in the

As shown in the above flow chart, the Indian FMCG above flow chart, the Indian FMCG industry is broadly classified into three categories. Foodsindustry is broadly classified into three categories. Foods and beverages is the category that we will be focusing upon majorly as the foods business division of ITC is and beverages is the category that we will be focusing upon majorly as the foods business division of ITC is where the internship took place.

where the internship took place.

D. D. URBAN AND RURAL INDUSTRY BREAK-UP:

URBAN AND RURAL INDUSTRY BREAK-UP:

Accounting for a revenue share

Accounting for a revenue share of around 60%, urban segment is the of around 60%, urban segment is the largest contributor to the overall revenuelargest contributor to the overall revenue generated by the FMCG sector in

generated by the FMCG sector in India & recorded a market size of India & recorded a market size of around USD29.4 billion in 2016. Semi-urbanaround USD29.4 billion in 2016. Semi-urban and rural segments are growing at a rapid pace; & accou

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In the overall revenues recorded by FMCG sector in India. In the last few years, the FMCG market has grown In the overall revenues recorded by FMCG sector in India. In the last few years, the FMCG market has grown at a faster pace in

at a faster pace in rural India compared with urban India FMCG products account for 50 rural India compared with urban India FMCG products account for 50 per cent of per cent of total ruraltotal rural spending.

spending.

E. E. MAJOR PLAYERS:

MAJOR PLAYERS:

According to the study conducted by AC Nielsen, 62

According to the study conducted by AC Nielsen, 62 of the top 100 brands are owned of the top 100 brands are owned by MNCs, and the balanceby MNCs, and the balance by Indian companies. Fifteen companies own these 62 brands, and 27 of these are owned by Hindustan by Indian companies. Fifteen companies own these 62 brands, and 27 of these are owned by Hindustan Unilever.

Unilever.

The top ten India FMCG brands are: The top ten India FMCG brands are:

1.

1. Hindustan Unilever Ltd.Hindustan Unilever Ltd. 2.

2. ITC (Indian Tobacco Company)ITC (Indian Tobacco Company) 3.

3. Nestlé IndiaNestlé India 4.

4. AMULAMUL 5.

5. Dabur IndiaDabur India 6.

6. Kellogg’sKellogg’s 7.

7. HaldiramsHaldirams 8.

8. Britannia IndustriesBritannia Industries 9.

9. Procter and Gamble Hygiene and Health care.Procter and Gamble Hygiene and Health care. 10.

10. Arico Industries.Arico Industries.

F. F. STRONG GROWTH IN THE INDIAN FMCG SECTOR

STRONG GROWTH IN THE INDIAN FMCG SECTOR



 The FMCG sector in India generated revenues worth USD47.3 billion in 2The FMCG sector in India generated revenues worth USD47.3 billion in 2015015



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

 In 2016, revenues for FMCG sector is eIn 2016, revenues for FMCG sector is expected to reach USD49 billionxpected to reach USD49 billion



 During 2015-16, seven leading FMCG companies in the country have fared better than theirDuring 2015-16, seven leading FMCG companies in the country have fared better than their multinational peers, in terms of revenue growth. The combined revenue of 7 leading Indian FMCG multinational peers, in terms of revenue growth. The combined revenue of 7 leading Indian FMCG companies during 2015-16 stood at USD 11,066.46 million

companies during 2015-16 stood at USD 11,066.46 million ..



 In the long run, with the system becoming more transparent & easily compliable, demonetisation isIn the long run, with the system becoming more transparent & easily compliable, demonetisation is expected to benefit organised players in the FMCG industry

expected to benefit organised players in the FMCG industry

G. G. COMPETATIVE ANALYSIS (PORTERS FIVE FORCES ANALYSIS):

COMPETATIVE ANALYSIS (PORTERS FIVE FORCES ANALYSIS):



 Competitive Rivalry:Competitive Rivalry:

Private label brands by retailers are

Private label brands by retailers are priced at a discount to priced at a discount to mainframe brands limits competition for the weakmainframe brands limits competition for the weak brands. Highly fragmented industry as more MNCs are

brands. Highly fragmented industry as more MNCs are enteringentering



 Threat of new entrants:Threat of new entrants:

Huge investments in setting up distribution network and promoting brands. Spending on advertisements is Huge investments in setting up distribution network and promoting brands. Spending on advertisements is aggressive.

aggressive. 

 Substitute Products:Substitute Products:

Presence of multiple brands. Narrow

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

 Bargaining Powers of Suppliers:Bargaining Powers of Suppliers:

Big FMCG companies are able to dictate the prices through local sourcing from a fragmented group of key Big FMCG companies are able to dictate the prices through local sourcing from a fragmented group of key commodity suppliers.

commodity suppliers. 

 Bargaining power of CustomerBargaining power of Customers:s:

Low switching cost induces the customers’ product shift. Influenc

Low switching cost induces the customers’ product shift. Influenc e of marketing strategies. Availability of samee of marketing strategies. Availability of same or similar alternatives.

or similar alternatives.

H. H. STRATEGIES ADOPTED:

STRATEGIES ADOPTED:

Promotions And Offers: Promotions And Offers:

FMCG companies are trying to

FMCG companies are trying to influence consumers with intelligent deals. Firms like ITinfluence consumers with intelligent deals. Firms like ITC offers combo deals toC offers combo deals to the consumers. For example, in the case of soaps & cosmetics; 4 soap cases are offered at the price of

the consumers. For example, in the case of soaps & cosmetics; 4 soap cases are offered at the price of 3, selling3, selling the range of deodorants for men & women at a discounted price.

the range of deodorants for men & women at a discounted price.

Research Online And Purchase Offline: Research Online And Purchase Offline:

The internet enables consumers to make their own research on the

The internet enables consumers to make their own research on the kind of products or commodities they wantkind of products or commodities they want to purchase. 1 in 3 FMCG shoppers goes online 1st & then to the stores. Almost half of the automobile to purchase. 1 in 3 FMCG shoppers goes online 1st & then to the stores. Almost half of the automobile consumers follow Research Online Purchase Offline (ROPO) method.

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Product Innovation: Product Innovation:

Indian consumers have become choosy & are less likely to stay loyal to a brand. Colgate-Palmolive has Indian consumers have become choosy & are less likely to stay loyal to a brand. Colgate-Palmolive has launched a toothpaste for the inflammatory gum problem of pyorrhoea. ITC is coming up with new multigrain launched a toothpaste for the inflammatory gum problem of pyorrhoea. ITC is coming up with new multigrain Bingo. Dabur has launched its sugar free variant for Chyawanprash in India. As of March 2017, ITC, which Bingo. Dabur has launched its sugar free variant for Chyawanprash in India. As of March 2017, ITC, which ventured in coffee &

ventured in coffee & chocolates segment under the Fabelle and Sunbean brands is planning to launch anotherchocolates segment under the Fabelle and Sunbean brands is planning to launch another premium range of items. By doing so, the

premium range of items. By doing so, the company is planning to compete with brands like company is planning to compete with brands like Nestle & Cadburys.Nestle & Cadburys.

Customisation: Customisation:

Product Flanking: Introduction of different combinations of products at different prices, to cover as many Product Flanking: Introduction of different combinations of products at different prices, to cover as many market segments as possible. Different types of same product for different users’ population. For example: market segments as possible. Different types of same product for different users’ population. For example: Calcium Sandoz & Calcium Sandoz Women & Horlicks for older women, Junior Horlicks. Emami, with a Calcium Sandoz & Calcium Sandoz Women & Horlicks for older women, Junior Horlicks. Emami, with a presence in over 60 countries across the world, has decided to rework on its overseas strategy by planning presence in over 60 countries across the world, has decided to rework on its overseas strategy by planning manufacturing and acquisitions in overseas markets. The company plans to re-work on its product portfolio manufacturing and acquisitions in overseas markets. The company plans to re-work on its product portfolio by getting into new categories with higher buying preference and revamp its distribution networks.

by getting into new categories with higher buying preference and revamp its distribution networks.

I. I. MACRO ENVIRONMENT ANALYIS:

MACRO ENVIRONMENT ANALYIS:

Political

Political EnvironmentEnvironment::

There have been a lot of initiatives from the government to ensure that there has been development of the There have been a lot of initiatives from the government to ensure that there has been development of the rural population. Schemes such as loan waivers, NREGA programmes etc. have been used to ensure that the rural population. Schemes such as loan waivers, NREGA programmes etc. have been used to ensure that the rural masses have been empowered and that there is more purchasing capacity with the citizens. The rural masses have been empowered and that there is more purchasing capacity with the citizens. The government has also ensured that there have been a lot of FDI inflows in this industry. 100 % investment is government has also ensured that there have been a lot of FDI inflows in this industry. 100 % investment is allowed in single brand retail and 51% in multi brand retail.

allowed in single brand retail and 51% in multi brand retail. Social

Social EnvironmeEnvironment:nt:

As seen earlier in the growth trends in the FMCG industry, there has been a change in the lifestyles of the As seen earlier in the growth trends in the FMCG industry, there has been a change in the lifestyles of the population of India. There has also been an increase in the desire to experiment with brands and innovative population of India. There has also been an increase in the desire to experiment with brands and innovative products. This has led to the

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Economic Environment Economic Environment

The above graph clearly shows that there has been an increase in the nominal per capita income for Indians. The above graph clearly shows that there has been an increase in the nominal per capita income for Indians. The graph also shows that the increase will continue to happen in the next

The graph also shows that the increase will continue to happen in the next three years as well.three years as well.

Technological Environment Technological Environment::

There has been a rapid increase in the

There has been a rapid increase in the technology available for manufacturing the products and packatechnology available for manufacturing the products and packaging theging the products. In some ways,, the latest technology in manufacturing has ensured that the cost of

products. In some ways,, the latest technology in manufacturing has ensured that the cost of production andproduction and time taken to produce is reduced, but the improvement in packaging( Tetra Pack)

time taken to produce is reduced, but the improvement in packaging( Tetra Pack) has made sure that there ishas made sure that there is a slight increase in the cost of production.

a slight increase in the cost of production.

Legal Environment: Legal Environment:

Goods and Service Tax(GST) which

Goods and Service Tax(GST) which will be implemented from the 1st will be implemented from the 1st June is something which the entire June is something which the entire FMCGFMCG industry is eagerly waiting for. The tax on the goods will be 20%. MCG sector wants an early rollout of the industry is eagerly waiting for. The tax on the goods will be 20%. MCG sector wants an early rollout of the Goods‐and‐Services tax (GST) so as to reduce supply chain constraints, improve competitiveness of FMCG Goods‐and‐Services tax (GST) so as to reduce supply chain constraints, improve competitiveness of FMCG companies against unorganised players. There has also been

companies against unorganised players. There has also been a relaxation on the a relaxation on the licensing rules. This has enablelicensing rules. This has enable betterment for all the players in the FMCG industry.

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KEY MERGERS & ACQUISATION DEALS IN THE INDUSTRY:

TARGET

TARGET NAME(SEGMENTNAME(SEGMENT) ) ACQUIRERACQUIRER

NAME(SEGMENT) NAME(SEGMENT)

MERGER/ACQUISITION MERGER/ACQUISITION

Godrej

Godrej Consumer Consumer Products Products ltd ltd Kenyan Kenyan Co Co Charm Charm Industries Industries AcquisitionAcquisition

Kesh

Kesh King King Emami Emami AcquisitionAcquisition

Johnson & Johnson (Savlon, Shower Johnson & Johnson (Savlon, Shower to Shower)

to Shower)

ITC Acquisition

Hindustan

Hindustan Unilever Unilever Ltd Ltd Unilever Unilever PLC PLC AcquisitionAcquisition

Namaste

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INDUSTRY REPORT

The scope and influence of logistics has evolved in the late 1940s. In the 1950s, and 60s, military was the The scope and influence of logistics has evolved in the late 1940s. In the 1950s, and 60s, military was the only organization which used logistics. The scope of logistics has been extended beyond the

only organization which used logistics. The scope of logistics has been extended beyond the army, as it hasarmy, as it has been recognized as one of the important tools for developing competitiveness. Competitive advantage been recognized as one of the important tools for developing competitiveness. Competitive advantage means the company has the ability to differentiate itself, in the customer’s eyes, and also is operating at a means the company has the ability to differentiate itself, in the customer’s eyes, and also is operating at a lower cost and greater profit. Logistics facilitates in getting products and services as and when they are lower cost and greater profit. Logistics facilitates in getting products and services as and when they are needed and desired to the customer. It also helps in economic transactions, serving as a major enabler of needed and desired to the customer. It also helps in economic transactions, serving as a major enabler of growth of trade and commerce in an economy. Logistics has come to be recognized as a distinct function growth of trade and commerce in an economy. Logistics has come to be recognized as a distinct function with the rise of mass production systems. Production and distribution were earlier viewed as a sequential with the rise of mass production systems. Production and distribution were earlier viewed as a sequential chain of extremely specialized activities. The role of logistics is to ensure availability of all the required chain of extremely specialized activities. The role of logistics is to ensure availability of all the required materials before every step in this chain. Obviously inventory of raw materials, semi-finished and finished materials before every step in this chain. Obviously inventory of raw materials, semi-finished and finished goods is a must across this chain to ensure its smooth functioning.

goods is a must across this chain to ensure its smooth functioning.

The concept of logistics has its base upon the systems approach. There is a single chain, with flow of The concept of logistics has its base upon the systems approach. There is a single chain, with flow of materials starting from the supplier, then to the plant and finally to the end customer, and also these materials starting from the supplier, then to the plant and finally to the end customer, and also these activities are done sequentially in

activities are done sequentially in order to achieve customer order to achieve customer satisfaction at low cost. For this to be satisfaction at low cost. For this to be successfulsuccessful there has to be co-ordination in the activities of the department. With reference to an organization, an there has to be co-ordination in the activities of the department. With reference to an organization, an organization gets a concrete shape due to its structure.

organization gets a concrete shape due to its structure.

DEFINITIONS OF LOGISTICS:

The American Council of Logistics Management

The American Council of Logistics Management defines logistics as “the process of planningdefines logistics as “the process of planning , implementing, implementing and controlling the efficient, cost effective flow and storage of raw materials, in-process inventory, finished and controlling the efficient, cost effective flow and storage of raw materials, in-process inventory, finished goods and related information from point of origin to point of

goods and related information from point of origin to point of consumption for the purpose of conforming toconsumption for the purpose of conforming to customers’ requirements”.

customers’ requirements”. Philip KotlerPhilip Kotler defines logistics as “planning, implementing, and controlling thedefines logistics as “planning, implementing, and controlling the physical flows of materials and finished goods from point of origin to point of use to

physical flows of materials and finished goods from point of origin to point of use to meet the customer’s needmeet the customer’s need at a profit”.

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LOGISTICS IN INDIA:

Currently the annual logistics cost of the world is estimated about USD 3.5 trillion. India spends around Currently the annual logistics cost of the world is estimated about USD 3.5 trillion. India spends around 14.4% of its GDP on logistics and transportation as compared to less than 8% by the other developing 14.4% of its GDP on logistics and transportation as compared to less than 8% by the other developing countries. Indian freight transport market is expected to grow at a CAGR of 13.35% by 2020 driven by the countries. Indian freight transport market is expected to grow at a CAGR of 13.35% by 2020 driven by the growth in the manufacturing, retail, FMCG and e-commerce sectors. Freight transport market in India is growth in the manufacturing, retail, FMCG and e-commerce sectors. Freight transport market in India is expected to be worth US$ 307.70 b

expected to be worth US$ 307.70 billion by 2020. In India Road Freight constitutes around 63% of the totalillion by 2020. In India Road Freight constitutes around 63% of the total freight movement consisting of 2.2 million heavy duty trucks and 0.6 million light duty trucks annually. The freight movement consisting of 2.2 million heavy duty trucks and 0.6 million light duty trucks annually. The road freight movement is expected to

road freight movement is expected to increase at a CAGR of 15increase at a CAGR of 15%. The Sea Freight consists of around 9% %. The Sea Freight consists of around 9% ofof the total freight market and is mainly used

the total freight market and is mainly used as a major mode for as a major mode for imports and exports. The air freight consistsimports and exports. The air freight consists of around 1% of the total freight market in India which will grow

of around 1% of the total freight market in India which will grow around 12.5% CAGR over the next 5years.around 12.5% CAGR over the next 5years. Companies in India currently outsource an estimated 52% of logistics

Companies in India currently outsource an estimated 52% of logistics and 3PL represents only 1% and 3PL represents only 1% of logisticsof logistics cost. As of now, the 3PL activity is

cost. As of now, the 3PL activity is limited to only few industries like automotive, IT hardware, telecom limited to only few industries like automotive, IT hardware, telecom andand infrastructure equipment. According to the survey conducted by the Transport intelligence in 2013 ranks infrastructure equipment. According to the survey conducted by the Transport intelligence in 2013 ranks India as the second most attractive logistics market in the future after china. In India, about 110 new logistics India as the second most attractive logistics market in the future after china. In India, about 110 new logistics parks are expected to be operational with an estimated cost of USD 1 Bn. Hence, India offers huge parks are expected to be operational with an estimated cost of USD 1 Bn. Hence, India offers huge opportunities in development of logistics services

opportunities in development of logistics services including warehousing, cold storage, shipping, ports andincluding warehousing, cold storage, shipping, ports and multi modal transportation, etc.

multi modal transportation, etc.

The Domestic Cargo Transport Industry in India comprises of several modes including Roadways, Railways, The Domestic Cargo Transport Industry in India comprises of several modes including Roadways, Railways, Inland Waterways, Coastal Shipping and Airways. Since the industry is gradually dealing with and surpassing Inland Waterways, Coastal Shipping and Airways. Since the industry is gradually dealing with and surpassing its shortcomings, it is bound to come closer to the realization of its potential in the future. The same in turn its shortcomings, it is bound to come closer to the realization of its potential in the future. The same in turn will not only augment the

will not only augment the competitiveness of the country, but will also create competitiveness of the country, but will also create more opportunities for domesticmore opportunities for domestic businesses and foreign enterprises operating in India. Freight transport market in India is expected to be

businesses and foreign enterprises operating in India. Freight transport market in India is expected to be worthworth US$ 307.70 billion by 2020. In India Road Freight constitutes around 63% of the total freight movement US$ 307.70 billion by 2020. In India Road Freight constitutes around 63% of the total freight movement consisting of 2.2 million heavy duty trucks and 0.6 million light duty trucks annually. The road freight consisting of 2.2 million heavy duty trucks and 0.6 million light duty trucks annually. The road freight movement is expected to increase at

movement is expected to increase at a CAGR of 15%. The a CAGR of 15%. The Sea Freight consists of around 9% of the total freightSea Freight consists of around 9% of the total freight market and is mainly used as a major mode for imports and exports. The air freight consists of around 1% of market and is mainly used as a major mode for imports and exports. The air freight consists of around 1% of the total freight market in India which will grow around 12.5% CAGR over the next 5 years with the lower the total freight market in India which will grow around 12.5% CAGR over the next 5 years with the lower turnaround time needed for delivery such as 24-hour de

turnaround time needed for delivery such as 24-hour delivery needed by the E-commerce livery needed by the E-commerce sector. In developingsector. In developing countries like India, an efficient logistics infrastructure can reduce the

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CHALLENGES FACED BY LOGISTICS INDUSTRY IN

INDIA:

TRANSPORT RELATED CHALLENGES:

In India road has become predominant mode of transportation of freight cargo. Estimate of the modal In India road has become predominant mode of transportation of freight cargo. Estimate of the modal movement of cargo highlights that in India nearly 60.2% of the cargo is moved by road, 32.1% by rail, and movement of cargo highlights that in India nearly 60.2% of the cargo is moved by road, 32.1% by rail, and rest by the coastal shipping, airways and

rest by the coastal shipping, airways and inland waterways. Pipelines constitute a very minland waterways. Pipelines constitute a very m inor proportion. Itinor proportion. It is recognized that movement of long haul bulk traffic by road is less efficient than by rail. But road is still is recognized that movement of long haul bulk traffic by road is less efficient than by rail. But road is still preferred over rail because:

preferred over rail because:

IMPORTANT RAIL NETWORKS ARE OVER

IMPORTANT RAIL NETWORKS ARE OVER SATURATED

SATURATED--There has been little improvement in the track infrastructure since independence. While route kilometre There has been little improvement in the track infrastructure since independence. While route kilometre has grown only at a CAGR of

has grown only at a CAGR of 3%, incorporating additional lines on existing routes has not fared much better3%, incorporating additional lines on existing routes has not fared much better growing at a low CAGR

growing at a low CAGR of 6.6%. During the same period freight and of 6.6%. During the same period freight and passenger traffic has grown at passenger traffic has grown at a CAGRa CAGR of nearly 55%. This had led to

of nearly 55%. This had led to most high-density corridors becoming oversaturated.most high-density corridors becoming oversaturated.

RAIL FREIGHT TARIFFS ARE

HIGH-Indian railways follow a policy of subsidizing passenger tariff by freight tariff. This has resulted in sharply Indian railways follow a policy of subsidizing passenger tariff by freight tariff. This has resulted in sharply rising trend in railway freight rate over the years compare to little increase in passenger tariff rate. The result rising trend in railway freight rate over the years compare to little increase in passenger tariff rate. The result of this has been that Indian rail freight rates have already become one

of this has been that Indian rail freight rates have already become one of the highest in the world.of the highest in the world.

TRANSIT TIMES ARE LONG AND UNCERTAIN

TRANSIT TIMES ARE LONG AND

UNCERTAIN--Freight traffic is frequently subordinated to passenger traffic on the railway network. This results in a

Freight traffic is frequently subordinated to passenger traffic on the railway network. This results in a freightfreight train taking as much as 6-8 days for a journey of 2000kms. Also, there is no guarantee on the transit time train taking as much as 6-8 days for a journey of 2000kms. Also, there is no guarantee on the transit time for freight trains.

for freight trains.

RAILWAY CARRIAGE NOT EASY FOR INDUSTRY WHICH CANNOT PROVIDE FULL TRAIN

LOADS

LOADS--Railways have a preference for customers who can provide full train load as unlike in some other countries, Railways have a preference for customers who can provide full train load as unlike in some other countries, railways in India no longer run mixed trains which can carry different types of cargo due to operational railways in India no longer run mixed trains which can carry different types of cargo due to operational inefficiencies.

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WHILE ROAD MOVEMENT IS PREFERRED TO RAIL, ROAD MOVEMENT HAS ITS OWN SET OF

CHALLENGES.

ROAD NETWORK ROAD NETWORK

COVERAGE-Freight movement in India is dependent on national highways. While NH constitutes only about 2% of the Freight movement in India is dependent on national highways. While NH constitutes only about 2% of the road network of India, they carry 40% of total traffic. As a result, most of these highways are severely road network of India, they carry 40% of total traffic. As a result, most of these highways are severely congested resulting in freight travelling only a third of the distance compared to developed countries. congested resulting in freight travelling only a third of the distance compared to developed countries. POOR ROAD

POOR ROAD

QUALITY-The road quality in India, on the NHs as well as the roads is improving but is still poor in many locations. The road quality in India, on the NHs as well as the roads is improving but is still poor in many locations. Estimates suggest that motor able roads are still less than 10% of the total road network.

Estimates suggest that motor able roads are still less than 10% of the total road network. HIGH LEVEL OF

HIGH LEVEL OF FRAGMENTATION OF THE TRUCKING INDUSTRY-FRAGMENTATION OF THE TRUCKING

INDUSTRY-The trucking industry in India is largely fragmented and in the hand of small truck operators. Estimates The trucking industry in India is largely fragmented and in the hand of small truck operators. Estimates suggest that nearly 70% of the truck owners in India own between 1-5 trucks. Due to this there is fierce suggest that nearly 70% of the truck owners in India own between 1-5 trucks. Due to this there is fierce competition amongst operators leading to truck owners resorting to overloading to recover investments. competition amongst operators leading to truck owners resorting to overloading to recover investments. MULTIPLE

MULTIPLE

CHECKPOINTS-Trucks in India have to pass through multiple check points in their journey. CHECKPOINTS-Trucks have to stop at state Trucks in India have to pass through multiple check points in their journey. Trucks have to stop at state borders, for payment of toll taxes, for RTO inspections etc.

borders, for payment of toll taxes, for RTO inspections etc.

In the ITC

Terminology Logisti

cs Shipment Is Carried Out by

Four Types

K1

–

SHIPMENT FROM MANUFACTURING UNIT TO WD (WHOLESALE

DEALERS)

–

GENERALLY, ONLY ATTA IS SHIPPED IN K1

K2

–

SHIPMENT FROM MANUFACTURING UNIT TO WSP (WAREHOUSE

SERVICE PROVIDER)

K3

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2.2 COMPANY OVERVIEW

ITC was incorporated on August 24, 1910

ITC was incorporated on August 24, 1910 under the name under the name Imperial Tobacco Company of India Limited. As theImperial Tobacco Company of India Limited. As the Company's ownership, progressively Indianite, the name of the Company was changed from

Company's ownership, progressively Indianite, the name of the Company was changed from Imperial TobaccoImperial Tobacco Company of India Limited to India Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. In Company of India Limited to India Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. In recognition of the

recognition of the Company's multi-business portfolio encompassing a wide range of businesses - Company's multi-business portfolio encompassing a wide range of businesses - Fast MovingFast Moving Consumer Goods comprising Foods, Personal Care, Cigarettes and Cigars, Branded Apparel, Education and Consumer Goods comprising Foods, Personal Care, Cigarettes and Cigars, Branded Apparel, Education and Stationery Products, Incense Sticks and Safety Matches, Hotels, Paperboards & Specialty Papers, Packaging, Stationery Products, Incense Sticks and Safety Matches, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business and Information Technology - the full stops in the Company's name were removed effective Agri-Business and Information Technology - the full stops in the Company's name were removed effective September 18, 2001. The Company now stands

September 18, 2001. The Company now stands rechristened 'ITC Limited, ‘where ‘ITC’ is today no longer anrechristened 'ITC Limited, ‘where ‘ITC’ is today no longer an acronym or an

acronym or an initialisedinitialised form.form.

A MODEST BEGINNING

The Company's beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the The Company's 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 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.

of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of L. Nehru Road) Kolkata, for the sum of RS. 310,000. ThisRS. 310,000. This decision of the Company was historic in more ways than one. It was to mark the beginning of a long and 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

eventful journey into India's future. The Company's headquarter building, 'Virginia House', which came up onCompany's headquarter building, 'Virginia House', which came up on that plot of land two years later, would go on to bec

that plot of land two years later, would go on to become one of Kolkata's most venerated landmarks.ome one of Kolkata's most venerated landmarks.

SBU- STRATEGIC BUSINESS UNITS OF ITC

FMCG FMCG HOTELS HOTELS PACKAGING PACKAGING PAPER PAPER BOARDS BOARDS IT IT

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1910: INCORPORATED AS IMPERIAL TOBACCO COMPANY

1925: PACKAGING AND PRINTING

1970: INDIA TOBACCO COMPANY LIMITED

1975: HOSPITALITY SECTOR 1975: HOSPITALITY SECTOR 1976: ITC LTD 1976: ITC LTD 1985: NEPAL SUBSIDIARY 1985: NEPAL SUBSIDIARY 1979: PAPERBOARDS BUSINESS 1979: PAPERBOARDS BUSINESS 1990: AGRI BUSINESS 1990: AGRI BUSINESS

2000: LIFESTYLE RETAILING AND IT

2001: PACKAGED FOODS

2002: EDUCATION AND

2002: EDUCATION AND STATIONERY, AGARBATTI AND SAFETYSTATIONERY, AGARBATTI AND SAFETY

MATCHES

2005: PERSONAL CARE PRODUCTS

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VISION:

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

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 To enhance the wealth generating capability of the enterprise in a globalising environment, delivering superior and sustainable stakeholder value.

superior and sustainable stakeholder value.

CORPORATE STRATEGIES:

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

ITC is a board-managed professional company, committed to creating enduring value for the nation and thenation and the shareholder. It has a rich organisational culture rooted in its core values of respect for people and belief in 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

empowerment. Its philosophy of all-round value creation is backed by strong corporate governance policiesbacked by strong corporate governance policies and systems.

and systems.

II

TC’S

CORPORATE STRATEGIES ARE:CORPORATE STRATEGIES ARE:

a)

a) Create multiple drivers of growth by developing a portfolio of world class businesses that best matchesCreate multiple drivers of growth by developing a portfolio of world class businesses that best matches organisational capability with opportunities in domestic and export markets.

organisational capability with opportunities in domestic and export markets. b)

b) Continue to focus on the chosen portfolio of Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards & Packaging, Agri BusinessFMCG, Hotels, Paper, Paperboards & Packaging, Agri Business and Information Technology.

and Information Technology. c)

c) Benchmark the health of each business comprehensively across the criteria of Market Standing,Benchmark the health of each business comprehensively across the criteria of Market Standing, Profitability and Internal Vitality.

Profitability and Internal Vitality. d)

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

e) Enhance the competitive power of the portfolio through synergies derived by blending the diverse skillsEnhance the competitive power of the portfolio through synergies derived by blending the diverse skills and capabilities residing in

and capabilities residing in ITC’s various businesses.ITC’s various businesses. f)

f) Create distributed leadership within the organisation by nurturing talented and focused top managementCreate distributed leadership within the organisation by nurturing talented and focused top management teams for each of the businesses.

ITC - Internship Report - WD Infrastructure

- STUDY OF WD

- STUDY OF WD

INFRASTRUCTURE &

INFRASTRUCTURE &

- HOW TO REDUCE TURN AROUND

- HOW TO REDUCE TURN AROUND

TIME FOR ITC WSP VEHICLE

TIME FOR ITC WSP VEHICLE

IIP-INDUSTRY INTERNSHIP PROGRAMME REPORT

IIP-INDUSTRY INTERNSHIP PROGRAMME REPORT

ORGANIZATION

ORGANIZATION

MASTER OF BUSINESS ADMINISTRATION

MASTER OF BUSINESS ADMINISTRATION

INDUSTRY INTERNSHIP PROGRAMME (IIP)

INDUSTRY INTERNSHIP PROGRAMME (IIP)

DECLARATION

DECLARATION

CERTIFICATE

CERTIFICATE

TABLE OF CONTENTS

TABLE OF CONTENTS

1. EXECUTIVE SUMMARY

1. EXECUTIVE SUMMARY

2.INTRODUCTION

2.INTRODUCTION

INTERNSHIP OBJECTIVES:

INTERNSHIP OBJECTIVES:

2.1 INDUSTRY OVERVIEW

2.1 INDUSTRY OVERVIEW

GLOBAL SCENARIO

GLOBAL SCENARIO

INDIAN OPERATIONS AND MARKET SHARE OF ITC

INDIAN OPERATIONS AND MARKET SHARE OF ITC

.

.

GLOBALISATION AT A GLANCE

GLOBALISATION AT A GLANCE

Contribution of more than US$ 2 billion to India's exports in the last decade.

Contribution of more than US$ 2 billion to India's exports in the last decade.

ITC's International Business Division is one of the largest Indian exporters of

ITC's International Business Division is one of the largest Indian exporters of

Agri-prod

Agri-products and is

ucts and is a preferred supply chain partner to

a preferred supply chain partner to compan

companies like

ies like Coca

Coca

Cola, Mitsubishi etc.

Cola, Mitsubishi etc.

Markets its own brand of cigarettes in the US and Middle East

Markets its own brand of cigarettes in the US and Middle East

1.

1. ALIGN PORTFOLIO FOR

ALIGN PORTFOLIO FOR GROWTH:

GROWTH:

2.

2. PAY ATTENTION TO SMALL BRANDS THAT DELIVER BIG:

PAY ATTENTION TO SMALL BRANDS THAT DELIVER BIG:

3.

3. THINK GLOBAL ACT LOCAL (GLOBALIZATION):

THINK GLOBAL ACT LOCAL (GLOBALIZATION):

4.

4. INDIAN SCENARIO:

INDIAN SCENARIO:

A.

A. EVOLUTION OF THE INDIAN FMCG SECTOR:

EVOLUTION OF THE INDIAN FMCG SECTOR:

B.

C.

C. MARKET SEGMENTS:

MARKET SEGMENTS:

D.

D. URBAN AND RURAL INDUSTRY BREAK-UP:

URBAN AND RURAL INDUSTRY BREAK-UP:

E.

E. MAJOR PLAYERS:

MAJOR PLAYERS: