Summer Training Report

On

“THE STUDY OF PRODUCTION AND DISTRIBUTION

CHANNELS OF
CHENAB TEXTILE MILLS, KATHUA (J&K)”
(A unit of Sutlej ind. Ltd, K.K Birla Group)

SUBMITTED BY: ABHIMANYU SHARMA

REGISTRATION NO: 10907840

1
 ACKNOWLEDGEMENT
Perseverance, inspiration and motivation have always played a great role in the success of
any venture. At this level of understanding it is often difficult to understand the wide
spectrum of knowledge without proper guidance and advice.

This report entitled "A STUDY OF CHANNELS OF DISTRIBUTION IN CHENAB

TEXTILE MILLS" KATHUA (J&K) for fulfillment of M.B.A programme.

I extend my sincere gratitude to MR. K.C SHARMA (Jt. Executive President), Mr. Sunil
Sharma (Dy.Manager- HR) and also Amit Sudan (Planning Officer) and for granting me
the opportunity to undergo my study in this organization and continuously guiding me
throughout the span of my study.

I am also thankful to all the team of this Unit. Who have given me their full cooperation
and devoted their valuable time for rendering me their needy services and guidelines
during the training period. With those sincere and precious efforts, I have been able to
complete my practical training successfully.

WITH SINCERE THANKS

ABHIMANYU SHARMA

2
 PREFACE

Practical training is an important part of the theoretical studies. It is of an immense

importance in the field of management. It offers the student to explore the valuable
treasure of experience and an exposure to real work culture followed by the industries
and there by helping the students to bridge gap between the theories explained in the
books and their practical implementations.

Training plays an important role in future building of an individual so that he/she can
better understand the real world in which he has to work in future. The theory greatly
enhance our knowledge and provide opportunities to blend theoretical with the practical
knowledge where trainees get familiar with certain aspects of industries, like shop floor
management, production process and industrial relations. I feel proud to get myself
trained at Chenab textile mills (kathua). Chenab textile mills are the leading textile
Company in India.

I have taken up training in Marketing Department and have studied and explained the
production and distribution channels used by Chenab textile mills. I availed this
opportunity in a very satisfactory manner and have tried to cover each and every aspect
that. I came across during my training period.

3
 LOVELY PROFESSIONAL UNIVERSITY
DEPARTMENT OF MANAGEMENT

TO WHOMSOEVER IT MAY CONCERN

This is to certify that the project report titled “Study of production and distribution
channels of chenab textile mills (kathua)” carried out by Mr. Abhimanyu Sharma S/o sh.
Gurdeep Sharma has been accomplished under my guidance & supervision as a duly
registered MBA student of the Lovely Professional University, Phagwara. This project is
being submitted by him/her in the partial fulfillment of the requirements for the award of
the Master of Business Administration from Lovely Professional University.

His dissertation represents his original work and is worthy of consideration for the award
of the degree of Master of Business Administration.

___________________________________
(Name & Signature of the Faculty Advisor)
Title: Study of Production and Distribution channel

Date:

4
 LOVELY PROFESSIONAL UNIVERSITY
DEPARTMENT OF MANAGEMENT

DECLARATION OF AUTHANTICITY BY STUDENT

I, "Abhimanyu sharma”, hereby declare that the work presented herein is genuine work
done originally by me and has not been published or submitted elsewhere for the
requirement of a degree programme. Any literature, data or works done by others and
cited within this dissertation has been given due acknowledgement and listed in the
reference section.

ABHIMANYU SHARMA
(Student's name & Signature)

10907840
(Registration No.)

5
 TABLE OF CONTENT
TOPICS Pag
e No
1. Introduction to the Distribution channels:-
a) Theoretical foundation about the Distribution channels 8-14
b) Review of Literature on the Distribution channels
2. Introduction to the Textile Industry:-
a) Overview of the Textile industry:-
 History
 Growth
 Landmarks
 Major players
 Market share of the major players
b) Profile of the Chenab Textile Mills (kathua)
c) History of the company
d) Recent achievements and milestones
e) Product range of the company
f) Performance of the company over the last few years.
g) Financial status of the company
h) Future Prospects / Plans
3. Objectives of the study and Research Methodology
 Source of data
 Sample place
 Sampling technique
 Methodology
 Limitation of the study
4. Data presentation, analysis and Interpretation
 Use of statistical technique (hypothesis testing)
 Data interpretation and conclusion
5. Summary, Conclusion and Recommendations
6. Appendix (Questionnaire, Glossary of the terms, Abbreviations,
Documents, Performa, Financial Statement ,etc.
7. Bibliography and References

6
INTRODUCTION TO DISTRIBUTION CHENNALS

1.1 CHANNELS OF DISTRIBUTION

Most producers do not sell their goods directly to the final consumers. Between them
stands a marketing channel, a host of marketing intermediaries performing a variety of
functions and bearing a variety of names. Some intermediaries such as wholesalers and
retailers buy take little to and result the merchandises they are called merchants. Other
such as brokers manufacturers representative and sales agents for customers and may

7
negotiate on the producers behalf but do not take to the goods; they are called Agents.
Still others such as transportation companies, independent warehouses, banks &
advertising - assist in the distribution process but neither take little to goods nor negotiate
purchases or sales, they do not come under distribution channel, they are called
intermediaries.

1.1.1 MEANING OF CHANNELS OF DISTRIBUTION

Channel of distribution is the last component of the total marketing process. After
production, the product is delivered to ultimate consumer and this is done through
marketing intermediaries or channel of distribution.
The word 'Channel' has been derived from the French word ‘CANAL’. The channel of
distribution refers to the path or route which a product follows from the point of
production to the point of consumption. It is a trade follows from the point of
consumption. It is a trade link between producers and ultimate consumers and acts as
bridge which connects two parties.
The channels of Distribution include various marketing intermediaries or middleman like
retailers and wholesalers but it does not include banks insurance companies etc. which
render valuable marketing services but are not direct marketing intermediaries. There are
also referred as "Functional Middlemen, Mercantile agent".
In the words of Cardiff and still” A channel of distribution may be defined as a path
traced in the direct or indirect transfer of the title to a product as it moves from producer
to ultimate consumer or industrial users.
The American Association defines marketing channels as the “structure of intra company
organization units and extra company agents and dealers , wholesale and retail which a
commodity product or services is marketed”.

1.1.2 ELEMENTS OF DISTRIBUTION CHANNEL

1) PATHWAY:-
Distribution channel is a pathway through which products and services flow from

8
manufacturer to consumer.
2) FLOW:-
The flow of goods and services is sequential and usually unidirectional.
3) COMPOSITION:-
It is composed of interme diaries also called middleman who participate in the flow
voluntarily.
4) FUNCTION:-
The intermediaries perform such functions which facilitate transfer of ownership and
possession of goods and services from marketers to consumers.
5) OBJECTIVES:-
Although channel components largely strive to achieve mutually acceptable objectives
the manufacturers focus is on achieving corporate marketing objectives.

1.1.3 FUNCTIONS OF DISTRIBUTION CHANNELS:-

A marketing channel performs the work of moving goods from producers to consumers.
It overcomes the time, place and possession gaps that separate goods and services. From
those who need or want to them. Members of the marketing or distribution channel
perform a number of functions. They are:-

A) Information:-
Marketing research information about potential and current customer, competitors etc.
B) Promotion:-
By attracting the customer through various sales promotional methods.
C) Negotiation:-
To attempt to reach final agreement on price and other terms.
D) Ordering:-
The backward communication of intention to buy the marketing channel members.
E) Financing:-
The acquisition and allocation of funds.
F) Risk Taking:-

9
The assumptions of risks connected with carrying out the channel work.
G) Physical Possession:
Movement of physical product from raw material to final customer.

1.1.4 CONSIDERATIONS TO BE TAKEN INTO ACCOUNT FOR

SELECTING A CHANNEL OF DISTRIBUTION.
Distribution of goods is as important as production. Existence of an organization largely
depends upon a proper and well organized system of distribution. It is therefore,
necessary that almost attention should be paid in selecting a channel of distribution.
Various constituents of the marketing mix like price, promotion, product and place etc.
are closely related to the channels of distribution. A wrong choice of distribution channel
ultimately increases the price of the produce.
Deciding a proper channel of distribution is not an easy task. It involves a careful study
and consideration of many factors stated below:-

1) The Nature of the Products:-

These factors include physical characteristics of a product and their impact on the
selection of a particular channel of distribution. Various factors under this category are:-
 Perishability of the product.
 Size and weight of the product.
 Unit value of the product
 Standardization
 Technical nature of the products
 Product lines.

2) The Nature of the Market:-

This is the most important factor influencing the choice of proper channel of distribution.
The number of buyers of the product affects the choice of a channel of distribution.
Following factors are considered in this regard:-
 Consumer of industrial market.

10
  Number of prospective buyers.
 Size of the order.
 Geographic concentration of market.
 Buying habits of customers.

3) The Nature of Middlemen:-

Marketing intermediaries are vital components in the distribution of goods. They greatly
influence the marketing of goods. Important factor relating to the selection of a particular
middlemen are below:-
 Cost of distribution of goods.
 Availability of desired middlemen.
 Unsuitable marketing policies for middlemen.
 Services provided by middlemen.
 Ensuring greater volume of sales.

4) The Nature and size of Manufacturing unit:-

This factor has a great impact on the selection of a distribution channel. The various
considerations in this regard are as follows:-
 Manufacturers reputation and financial stability.
 Ability and experience of the marketing.
 Desire for control of channel.
 Industrial conventions.
 Services provided by the manufacturers.

5) Govt. Regulations & Policies:-

This factor also influences the choice of distribution channels. The Govt. may impose
certain restrictions on the wholesaler’s trade of a particular product and takeover the
distribution of certain products. All these restrictions have a direct impact in selecting the
channel of distribution.

11
6) Competition:-
The nature and extent of competition prevalent in an industry is an another detrimental
consideration in selecting a distribution channel. Different manufacturers producing
similar products may employ the same channels of distribution.

1.1.5. TYPES OF DISTRIBUTION CHANNEL

Marketing channel can be characterized by a number of channel levels each middleman
that performs work in bringing the product and its title to the final buyer constitute a
channel level. Since the producer and the final customer both perform work they are part
of every channel.
Basically, there are two types of distribution channel, viz
a) Consumer distribution channel.
b) Industrial distribution channel

a) Consumer Distribution Channel:-

It is used or can be seen in case of consumer goods where there are large numbers of
buyers. Four channels are widely used in distributing tangible product to ultimate
consumer.
1. Manufacturer -> Consumer (Zero level channels)
It consists of a manufacturer setting directly to the final customer.
M C
2. Manufacturer  Retailer Consumer (one level channel):-
Many large retailers
A buy directly from manufacturer and agriculture producers and sellOit
to the final customers. N
N
3. Manufacturer  Wholesaler  Retailer  Consumer (Two Level channel)
U S
4. Manufacturer  Wholesaler  Agent (jobber)  Retailer Consumer.
(Three Level Channels):-
F U
A three level channel contains three intermediaries. For example, in the meat packing
M
A
industry, wholesalers sell to agents, who sell to small retailer.
C E

T R
DIRECT
U

R
12
E
 (ZERO LEVEL CHANNEL)

RETAILER

(ONE LEVEL CHANNEL)

WHOLE RETAILER
SALER

(TWO LEVEL CHANNEL)

WHOLE AGENT RETAILER

SALER (JOBBER
)

(THREE LEVEL CHANNEL)

CONSUMER MARKETING CHANNEL

INDUSTRIAL DISTRIBUTION CHANNEL:-

It is used or can be seen in case of industrial good where the buyers are
less in numbers as compared to the consumer goods. There are three channels for
industrial goods, which is described in the following diagram.

INDUSTRIAL
DISTRIBUTOR

13
 CUSTOMER
MANUFACTURER INDUSTRIAL
MANUFACTURER’S
REPRESENTATIVE

MANUFACTURER’S
SALES BRANCH

INDUSTRIAL MARKETING CHANNEL.

2.1. Indian Textile Industry:

14
The Indian textile industry has a significant presence in the economy as well as in the
international textile economy. Its contribution to the Indian economy is manifested in
terms of its contribution to the industrial production, employment generation and foreign
exchange earnings. It contributes 20 percent of industrial production, 9 percent of excise
collections, 18 percent of employment in the industrial sector, nearly 20 percent to the
countrys total export earning and 4 percent to the Gross Domestic Product.
In human history, past and present can never ignore the importance of textile in a
civilization decisively affecting its destinies, effectively changing its social scenario. A
brief but thoroughly researched feature on Indian textile culture

2.1.2. HISTORY OF TEXTILE INDUSTRY

India has been well known for her textile goods since very ancient times. The traditional
textile industry of India was virtually decayed during the colonial regime. However, the
modern textile industry took birth in India in the early nineteenth century when the first
textile mill in the country was established at fort gloster near Calcutta in 1818. The cotton
textile industry, however, made its real beginning in Bombay, in 1850s. The first cotton
textile mill of Bombay was established in 1854 by a Parsi cotton merchant then engaged
in overseas and internal trade.The first cotton mill in Ahmedabad, which was eventually
to emerge as a rival centre to Bombay, was established in 1861. The spread of the textile
industry to Ahmedabad was largely due to the Gujarati trading class.The cotton textile
industry made rapid progress in the second half of the nineteenth century and by the end
of the century there were 178 cotton textile mills; but during the year 1900 the cotton
textile industry was in bad state due to the great famine and a number of mills of Bombay
and Ahmedabad were to be closed down for long periods. The two world Wars and the
Swadeshi movement provided great stimulus to the Indian cotton textile industry.
However, during the period 1922 to 1937 the industry was in doldrums and during this
period a number of the Bombay mills changed hands. The second World War, during
which textile import from Japan completely stopped, however, brought about an
unprecedented growth of this industry. The number of mills increased from 178 with 4.05
lakh looms in 1901 to 249 mills with 13.35 lakh looms in 1921 and further to 396 mills
with over 20 lakh looms in 1941.The cotton textile industry is rightly described as a

15
Swadeshi industry because it was developed with indigenous entrepreneurship and capital
and in the pre-independence era the Swadeshi movement stimulated demand for Indian
textile in the country. The partition of the country at the time of independence affected
the cotton textile industry also. The Indian union got 409 out of the 423 textiles mills of
the undivided India. 14 mills and 22 per cent of the land under cotton cultivation went to
Pakistan. Some mills were closed down for some time. For a number of years since
independence, Indian mills had to import cotton from Pakistan and other countries.
After independence, the cotton textile industry made rapid strides under the Plans.
Between 1951 and 1982 the total number of spindles doubled from 11 million to 22
million. It increased further to well over 26 million by 1989-90.

2.1.3. CURRENT POSSITION OF TEXTILE INDUSTRY IN INDIA

Textile constitutes the single largest industry in India. The segment of the industry during
the year 2000-01 has been positive. The production of cotton declined from 156 lakh
bales in 1999-2000 to 1.40 lakh bales during 2000-01. Production of man-made fibre
increased from 835 million kgs in 1999-2000 to 904 million kgs during the year 2000-01
registering a growth of 8.26%. The production of spun yarn increased to 3160 million kgs
during 2000-01 from 3046 million kgs during 1999-2000 registering a growth of 3.7%.
The production of man-made filament yarn registered a growth of 2.91% during the year
1999-2000 increasing from 894 million kgs to 920 million kgs. The production of fabric
registered a growth of 2.7% during the year 1999-2000 increasing from 39,208 million sq
mtrs to 40,256 million sq mtrs. The production of mill sector declined by 2.6% while
production of handloom, powerloom and hosiery sector increased by 2%, 2.7% and 5.1%
respectively. The exports of textiles and garments increased from Rs. 455048 million to
Rs. 552424 million, registering a growth of 21%. Growth in the textile industry in the
year 2003-2004 was Rs. 1609 billion. And during 2004-05 production of fabrics touched
a peak of 45,378 million squre meters. In the year 2005-06 up to November, production
of fabrics registered a further growth of 9 percent over the corresponding period of the
previous year. With the growing awareness in the industry of its strengths and weakness
and the need for exploiting the opportunities and averting threats, the government has
initiated many policy`measures`as follows.

16
The Technology Upgradation Fund Scheme (TUFS) was launched in April 99 to provide
easy access to capital for technological upgradation by various segments of the Industry
The Technology Mission on Cotton (TMC) was launched in February 2000 to address
issues relating to the core fibre of Cotton like low productivity, contamination, obsolete
ginning and pressing factories, lack of storage facilities and marketing infrastructure
A New Long Term Textiles and Garments Export Entitlement (Quota) Policies 2000-
2004 was announced for a period of five years with effect from 1.1.2000 to 31.12.2004
covering the remaining period of the quota regime.

2.1.4. FUTURE PROSPECTS:-

The future outlook for the industry looks promising, rising income levels in both urban
and rural markets will ensure a rising market for the cotton fabrics considered a basic
need in the realm of new economic reforms (NER) proper attention has been given to
the development of the textiles industry in the Tenth plan. Total outlay on the
development of textile industry as envisaged in the tenth plan is fixed at Rs.1980 crore.
The production targets envisaged in the terminal year of the Tenth plan are 45,500
million sq metres of cloth 4,150 million kg of spun yarn and 1,450 million kg of man
made filament yarn. The per capita availability of cloth would be 28.00 sq meters by
2006-2007 as compared to 23.19 sq meters in 2000-01 showing a growth of 3.19
percent. The export target of textiles and apparel is placed at $32 billion by 2006-2007
and $50 billion by 2010.

Vision India 2010 for`Textiles

 Textile economy to grow to $85bn. by 2010

 Creation of 12 million new jobs in Textile Sector
 To increase India’s share in world trade to 6% by 2010.
 Achieve export value of $ 40 Billion by 2010.
 Modernization and consolidation for creating a globally competitive industry.

2.1.5. STRUCTURE OF INDIAS TEXTILE INDUSTRY

The textile sector in India is one of the worlds largest. The textile industry today

17
divided into three segments:
1. Cotton Textiles
2. Synthetic Textiles
3. Other like Wool, Jute, Silk etc.

All segments have their own place but even today cotton textiles continue to dominate
with 73% share. The structure of cotton textile industry is very complex with co-
existence of oldest technologies of hand spinning and hand weaving with the most
sophisticated automatic spindles and loom. The structure of the textile industry is
extremely complex with the modern, sophisticated and highly mechanized mill sector
on the one hand and hand spinning and hand weaving (handloom sector) on the other in
between falls the decentralised small scale powerloom sector.
Unlike other major textile-producing countries, Indias textile industry is comprised
mostly of small-scale, nonintegrated spinning, weaving, finishing, and apparel-making
enterprises. This unique industry structure is primarily a legacy of government policies
that have promoted labor-intensive, small-scale operations and discriminated against
larger scale firms:

2.1.10. SWOT ANALYSIS OF INDIAN TEXTILE INDUSTRY

Indian textile industry has several Strengths

 Abundant Raw Material Availability

 Low Cost Skilled Labour
 Presence across the value-chain
 Growing Domestic Market.

Indian textile industry has several Weaknesses

 Fragmented industry
 Effect of Historical Government Policies

18
 Lower Productivity and Cost Competitiveness

Indian textile industry has several Opportunities

 Post 2005 challenges

 Research and Development and Product Development

Indian textile industry has several Threats

 Competition in Domestic Market

 Ecological and Social Awareness
 Regional alliances.

Strengths:-
Abundant Raw Material Availability:

Allowing the industry to control cost and reduce over all lead-times across the value
chain.
Low Cost Skilled Labour

Low cost skilled labour providing a distinct competitive advantage for the industry.

Presence across the value-chain

Presence across the value-chain providing a competitive advantage when compared to

countries likes Bangladesh, Srilanka, who have developed primarily as garmenters.
Reduced Lead-times:

Manufacturing capacity present across the entire product range, enabling textile
companies and garmenters do source their material locally and reduce lead-time.

Super Market:Ability to satisfy customer requirements across multiple product grades-

small and large lot sizes specialized process treatments etc.

19
Weaknesses
Fragmented industry

Fragmented industry leading to lower ability to expand and emerge as world-class

players.

Effect of Historical Government Policies

Historical regulations thought relaxed continue to be an impediment to global

competitiveness.
Lower Productivity and Cost Competitiveness.

 Labour force in India has a much lower productivity as compared to competing

countries like china, Srilanka etc.
 The Indian industry lacks adequate economies of scale and is therefore unable to
compete with china, and other countries etc.
 Cost like indirect takes, power and interest are relatively high.

Technological Obsolescence

 Large portion of the processing capacity is obsolete

 While state of the art integrated textile mills exist majority of the capacity lies
currently with the powerloom sector.
 This has also resulted in low value addition in the industry.

Opportunities

Post 2005 challenges

During the year 2005 is a huge opportunity that needs to be capitalised.

20
 Research and Development and Product Development

 Indian companies needs to increase focus on product development.

Newer specialized fabric- smart Fabrics , specialized treatement etc.Faster turn around
times for design samples Investing in design centers and sampling labs.
 Increased use of CAD to develop designing capability in the Organisation and
developing greater options
 Investing in trend forecasting to enable growth of the industry in India.

Threats
Competition in Domestic Market

 Competition is not likely to remain just in the exports space, the industry is
likely to face competition from cheaper imports as well.
 This is likely to affect the domestic industry and may lead to increased
consolidation.

Ecological and Social Awareness

 Development in the form of increased consumer consciousness on issues such

as usage of child labour unhealthy working conditions etc.
 The Indian industry needs to prepare for the fall out of such issues by issues by
improving its working practices.

Regional alliances

 Reginal trade blocs play a significant role in the global garment industry with
countries enjoying concessional tariffs by virtue of being members of such blocs/
alliances.
 Indian industry would need to be prepared to face the fall out of the post 2005
scenarious in the form of continued barriers for imports.

21
2.1.13. MAJOR PLAYERS IN TEXTILE INDUSTRY
Following are some major players in the vast field of Indian Textile Industry.

Arvind Mills
Arvind Mills is one of the major and fully vertically integrated composite mills player in
India. It has large production in denim, shirting and knitted garments. It is now adding
value by manufacturing denim apparel. Its sales are around US$ 300 million.

Raymonds
Raymonds has the large, diversified integrated business model, which is spread across the
value chain from yarn to retail. It is specialized in Diversified woolen textiles. It already
supplies to some US retailers. It also looking to also expanding denim capacity and to
become second largest denim player in India. Its presence in retail will be big positive in
future. Its annual sales are around US$ 300 millions

Reliance Textiles:

Reliance Textiles is one of the major Textile Company that is in business of fully
integrated manmade fiber. It has capacity of more than 6 million tones per year. It has
joint venture partners like, DuPont, Stone & Webster, Sinco (Italy) etc.

Vardhaman Spinning:

Vardhman deals in spinning, weaving and processing segment of the industry. It is

planning to double its fabric processing capacity to 50 million meters. It is an approved
supplier to global retailers like GaP, Target and Tommy Hilfiger. Its sales are little over
US$ 120 millions

Welspun India (Manufactures terry towels)

22
Century Textiles (Composite mill, cotton & Man-made)

Morarjee Mills (Fully integrated Composite Mill) ndo Rama (Cotton and Man-made)

GTN Textiles (Cotton Yarn and Knit Fabrics)

Ginni Filaments Ltd. (Yarn and Fasbric)
LNJ Bhilwara Group (Diversified and vertically integrated denim producer with
spinning and weaving capacity)
Mafatlal Textiles (Fully integrated Composite Mill)
Modern Group (Diversified, producer of denim, syntax and thread)
Ashima Syntex (Man-made Fiber)
KG Denim (Fabrics)
Alok Textiles (Cotton and Man-made Fiber Textiles)
Sharda Textile Mills (Man-made Fiber)
Birla Group Dormeuil Birla VXL Ltd. (Fully integrated woolen textiles)

23
2.2. PROFILE OF THE COMPANY

GATEWAY OF CHENAB TEXTILE MILLS (KATHUA)

24
 CHENAB TEXTILES KATHUA, (A BIRLA GROUP OF INDUSTRIES)
Ph. No 01922 - 233501, 233502, 234015
CHENAB TEXTILE MILLS, equipped with most modern and
state of the art textile machines and sophisticated quality control
equipments, started its operations in 1965 and today is well
established and known for its quality products. Mill's strength
lies in its trained and dedicated workforce and continuous
upgrading of human resources skills. The Capital Investment
made in the unit is more than 95 Crores. There are near about
5000 employees working in day night shifts.

CTM has always been a customer oriented company and keeps

on modifying its manufacturing practices and processes by
upgrading technology and modernisation of its manufacturing
facilities to meet the changed needs of its customers over the
years.

At CTM, we believe that there is always room for improvement

which is guiding force for us in ensuring the right quality at the
right time and of course at reasonable price.
Polyester/Viscose Count NE 8 Raw White,
CONE
Synthetic Yarns 100% Polyester to Dyed &
'S
100% Viscose NE 36 Melange
6"
Cotton Yarns Melange & Dyed Count NE 16 to NE 36 Single & Multi-folds
Cone
Polyester/Cotton in
Count NE 6
Melange & Dyed. Single & Multi-folds 6"
Cotton Blended to
Acrylic/Cotton in Single & Multi-folds Cone
NE 36
Melange & Dyed.
Count NE 28/2 dmm to 6"
Acrylic Yarns Relaxed Dyed Single & Multi-folds
NE 32/2 dmm Cone

2.2.1. INTRODUCTION:-

25
A Chenab textile mill is one of the leading company in the textile industry. This company
is situated in the mid heart of beautiful city kathua. Chenab Textile Mills, equipped with
most modern and state of the art textile machines and sophisticated quality control
equipments, started its operations in 1978 and today is well established and known for its
quality products. Mill's strength lies in its trained and dedicated workforce and
continuous upgrading of human resources skills. It has been selected by he Government
of Jammu & Kashmir for the special award for its contribution towards
generation/promotion of employment in the State and contribution to State revenue. At
present this Mill is divided in 10 units running with the capacity of 170000 spindles
Approx. This will be producing 110 tonne of yarns per day. The main production of this
mill is synthetic yarn (Polyester, Acrylic, Viscose, cotton, cotton mélange,
polyester\acrylic yarn, viscose\acrylic yarn, polyester/viscose yarn, acrylic/cotton yarn &
viscose/cotton yarn) as well as cotton yarn. This mill is fully determined to get ISO-9002
certificate for quality. This mill is equipped with high production machines of latest
techniques. This mill is on the path of progress by its slogan:-

"WORK IS WORKSHIP”

K.KBIRLA GROUP

26
I have undergone my training in the Chenab Textile Mills (A
Birla Group), Kathua (j&k). because of the following reasons:-

 It is a leading firm in the textile industry.

 The company is a part of Birla Group, one of the prominent

 Industrial houses of India.

 The annual turnover is 48763 crores.

 It is a continues developing company

 The company keeps a good image among their customers.

27
2.2.2 VALUES, MISSION AND VISSION OF THE COMPANY.

VALUES:-

 CARE: - Giving back to the society, servicing the community and providing
respectful conduct to the public and our peers.
 CRAFT: - Treating the science of textile yarns with dedication and reverences of
an art form, we believe in our work as a merger of technology and craft.
 COMPETENCE: - For us, our customers comes first. Giving them the best in
class product maximum output and most convenient schedule.

MISSION: -

To be the largest single point provider for all blends and shades of spun yarns and an
organization that prides itself on integrity, environmental consciousness, scheduled
delivery and adherence to international quality norms - to the best of our customer’s
satisfaction.

VISION: -

To be a leading player in the global textile industry, providing comprehensive textile

solution under one roof, highlighted by quality, variety and impeccability for our
esteemed customers.

28
2.2.3. SWOT ANALYSIS OF THE COMPANY

STRENGTHS:-

 Various incentives provided by J&K Govt. such rebates in taxes like octrol,
toll tax and other duties on inter – state borders and continuous supply of
electricity at very cheaper rates.
 Availability of labour at comparatively cheaper wages.
 Good effective distribution channel.
 High quality products manufactured by the mill.
 Consumer of multiple fiber (man made and synthetic), making it a versatile
developer.
 Strong R&D and innovation focus helping accelerate new design.
 Modern technology and assets reflected in the fact that about 71% of gross
block is less than seven yrs old.
 Amongst the lowest cost producer of fabric in India, large and reputed
customer base within India and abroad.

WEAKNESSES:-

 High prices of the yarn.

 Less number of agents and less deals in some areas
 Much dependent upon depots for the distribution system.
 Nearness to the raw material resources but distant from consumer market.

29
OPPORTUNITIES:-

 Following the introduction of WTO, the company has the potential to cater to a
large and growing textiles market.

 Cater expansion will enable the company to diversify its product basket and
reduce cost even further.
 Increase in the demand of cotton yarn, staple yarn etc.
 Export to other countries.
 Erection of new yarn required industries.

THREATS:-

 Entry of new Textile Industries.

 Low prices of some competitors.
 Presence of small scale manufactures.
 Hardening of rupee and raising interest rate.
 Cotton is being increasingly preferred over man made fiber

2.2.4. BOARD OF DIRECTORS.

 Mr. K.K Birla

 Mr. K.R Podar.
 Mr. Arvind C Dalal.
 Mr. Malin Kant Dhiraj Dalal.
 Mr. V. K Khaitan.
 Mr. S. C Nagar.

30
  Mr. H. Nanjundian.
 Mr. G.C Sethi (Nominee ICICI).
 Mr. Naresh Chander Mohan.
 Mr. S.M Aggarwal.
 Mr. R.N Ladha.
 S K khandelia

2.2.5. ORGANISATION STRUCTURE:

Organization is a group of persons working together to achieve a common goal.

Organization indicates conscious combinations of systematic arrangement of various
resources in the term 6 M’s
 Men
 Machine
 Material
 Money
 Management information
 Marketing
An organization structure means establishment of a hierarchy according to the authority
and responsibility. Every decision of work has to follow the channel and no activity of an
enterprise can go out of it.

2.2.6. MANAGEMENT OF CTM

Management has been defending in a variety of ways. It may be considered in terms that
describe what managers do in the operation of their organization plan, organize, initiate
and control operation. They plan by setting strategies and goal selecting the best course
of action to achieve the plan. They organize the tasks necessary for the operational plan,

31
set these tasks into homogeneous groups and assigns authority delegation. They control
the programme standards and avoiding deviation from standards. Otherwise the term
management refers to the mustering of physical and human resources to carry planned
activities and control performance in order to ensure that what is done, what is expected
and so realize the objective of an establishment. Thus company in the best position to
develop the business maximize the profitability and to maintain the customers
satisfaction with its best quality production. The relations between workers and
management continue to be very cordial and harmonious during the history. Its proof is
that here never has been any strike or lockout. The company is managed by a team of
professionally competent managers, who are well versed and learned persons in their
work. Company turnover during 1988-89 was Rs. 74.50 crore as compared to Rs. 70.25
crore in the year 1987-88. Company export during 1988-89 was Rs. 1.22 crores.
Company has also two subsidiary companies viz. SCM investment and trading co.ltd and
RTM investment and Trading co ltd.

2.2.7. A BRIEF REVIEW OF ALL DEPARTMENTS

Chenab Textile Mills is a very big concern. The Chenab Textile Mills is spread of canals,
has been acquired on lease basis for a period of 99 years. It has been functioning
smoothly and employs about 7000 workers and 750 staff members.

Chenab Textile Mills has the following departments;

 Marketing Department
 Sales & Excise Department
 Financial Department
 Raw Material Department
 Time Office Department
 Store Department
 Human Resource Department
 EDP (Electronic Data Processing Unit) Department

32
  Budget & costing Department
 Typing Department
 Report Section
 Process House
 Spinning Quality Control Department
 General Department
 Finishing Department
 Finishing Cotton Department
 Finishing Maintenance Department
 Mixing & Waste Department
 Building & Engineering Department
 Outstation Staff Department
 Watch & Ward Department
 Other Subordinate Departments.

2.2.8. MANUFACTURING PROCESS

Raw material go down is for stocking of various types of raw materials i.e. cotton, staple
polyester and acrylic etc. mixing department and blow room. Various types of fibers are
mixed and blended and spinning processes start. The raw material is delivered from the
machine in the shape of sheet roll i.e. in lap form. Carding the function of carding
machine are further cleaning of impurities, dropping out short fiber and removal of
immature fibers, carding machine are delivered fibers, which were in sheet form i.e. fed
to machine. The machine has function to parallelism of fiber and blending for awareness.
Super lap in this machine drawing cans are fed and super laps are produced.
Comber super lap are fed in this machine to parallel cotton fiber and produce comb silver
too further mix up and processed for manufacture of milling yarn on 100% combed yarn.
Simplex draw frame fiber (silver) is fed into this machine and drafted to hank rocing
according counts to be spun.

33
Ring frame this is the main spinning process on which the yarn is produced. Auto corner
its function is to remove the defects of single yarn. Cheese winding and doubling this
process prepare the single yarn to ply yarn.

OPERATION FLOW CHART

GODOWN

MIXING/ BLENDER

CARDING

BREAKER DRAW FRAME

FINISHER DRAW FRAME

SIMPLEX

RINGFRAME

WINDING

34
 DOUBLING

REELING

PACKING

TO MARKET

PROCESS OF SPINNING

(Dyeing)

35
 (Blow room)
Trumac with Multimixer, LMW

(CARDING)

(DRAWING)

36
 (Simplex)

(Ring Frame)

(Auto Coner)

(TFO Twisting)

37
 (Elasto Twister)

(Hairyness & Evenness tester)

(Uster Tester -3 to check Yarns

imperfections)

38
 (Colour Matching Computer)

(Packing cartons)

2.3. COMPANY HISTORY

2.3.1. HISTORY AND DEVELOPMENT:

Initial capacity was 4000 kgs. Of staple yarn per day its initial capital was Rs. 83 lacks. In
1973 it rolled to 98.84 lacks. In 1962, when CTM was installed; there was no railway
station in J&k state. Raw material and the finished yarn were transported via Pathankot
(app. 25kms. From kathua). Raw Material was purchased from various places like
Bhatinda, Amritsar, Malot and Delhi. The cost of production was too high because of
large expenditure on transportation of goods and raw material State Government
provided incentives and rebates in takes such as octrol, toll tax and other duties on inter-
state borders.
The incentives included the continuous supply of electricity at very cheaper rates than the
other states. The labour was also available at the comparatively cheaper wages. There is
no source of raw material in J&K as the major agricultural production is rice, wheat and
beans etc. Previously there was no market for the product-the finished goods, in the state
but little consumption of the product has developed in the region of Samba and Srinagar.
The main market at that time for selling the finished goods, staple yarn were Ludhiana
Amritsar, panipat and Delhi. Initially the unit was producing only staple yarn but later on

39
it diversified partially to cotton yarn production too along with the staple yarn.

INAUGURATION OF SECOND UNIT

IN 1973-74 & 1974-75 Chenab Textile Mills earned huge profit and Production Approx
Rs. 10822112/- therefore there occurred need for the expansion to double its capacity,
hence the second unit of Chenab Textile Mills came into existence in 1976. Honorable
Chief Minister of J&k Mohd. Sheikh Abdullah Inaugurated the new unit increased hence
the production capacity of the unit also increased by 12000 kgs. of staple yarn per day.
This expansion was only meant for the synthetic yarn with the machinery of modernized
technology. With the production of the synthetic yarn, its product entered in the main
market of Indian textile products i.e Bombay, Surat, Ahmedabad and Bhwani. Besides
this one process house for dying fibre was set up with the capacity of dying 3200 kgs. of
fibre per day and of yarn of capacity of 1600kgs per day therefore the assets of the mill
became Rs. 5,69, 81,491/-
Modernization in CTM:
In 1981, old machineries were replaced with the modernized hi-tech machinery. In cotton
section 3080 more spindles were meant for the production of acrylic yarn. With that the
unit entered in exporting of the quality yarn to Nepal and Australia.
In the recent years (since 1991-92) the mill has been modernized by replacing the new
sophisticated and prestigious machinery in place of the old. The mill has installed in the
recent years certain years certain modern machines like Open-Ended, Roller Spinner
Machines with the RPM of high speed. Rupees 4 crore have been sent for the
modernization of the unit during the years 1991-93. An automatic winding machine of
speed performance is going to be launched at or before next year. Hence mordernisation,
the fast growing need of the unit is on the move keeping its prestigious place in the
highly competitive market of the business world.
The expansion of plant has been done by 2,112 spindles to manufacture plv dyed yarn.

Units Years of Inaugration No. of spindles

1 1962 14304

40
 2 1976 7968

3 1990 9984
4 1992 8640
5 1993 5760
6 1995 8448
7 1997 15240
8 2000 27600
9 2006 40704
10 2008 31104

TOTAL 169752

ISO 9002 Certificate

In Oct 1998, chenab Textile Mills Kathua finally got ISO 9002 certificate from the
international standards organization for its unit 4 and 5 out of six unit it has CTM was
trying hard since many years to received the ISO 9002 certificate. Now its aim is to
received the ISO 9002 certificate for its remaining units. Now it has ten units.

Development of CTM
Since the commercial production stated in Jan 1965, the mills has been continuosly
investing in modernization and expansion of capacities. As on 31st of march 2000 the
installed capacity of mills is around 60,000 spindles.The production capacity increased
by 12000 Kgs of staple yarn per day. As per the company installed its first unit whose
capacity is today is about 14304, the 2nd unit of company is established in 1976and
capacity of the unit is 7968, the 3rd unit is inaugurated in 1990 increased its capacity upto
9984 spindles. The capacity of fourth is 8640 spindles get inaugurated in 1992. The fifth

41
unit of CTM is prepared in 1993 get a mordenized with the 5760 spindles. The sixth unit
having a capacity of 8448 spindles today get established in 1995. The seventh unit is
established in 1997 get the capacity of 15240 spindles. The eighth unit is established in
2000 at present working with the power of 27600 spindles. The ninth unit having the
capacity of 40704 gets established on 2006.the tenth unit is under construction of 31104
spindles, after the complition of tenth unit, the company has a total capacity of 169752
spindles.

2.3.2. SOURCE OF RAW MATERIAL:

Raw material consumed by this mill is of two type’s i.e. Naturalfibre, man made fiber.
The cotton fiber comes in the first category and polyester, viscose and acrylic comes in
second comes in second category. During the early Eighties, man made fiber was
imported from Japan, Italy and Yugoslavia. But now it is purchased form various part.
Various sources of man made fiber are described below:-

Source of Polyesters:
 Reliance industrial Limited, Bombay.
 Bongaigoan Refinery and Petrochemicals Limited, Assam.
 J.K Synthetics Limited, New Delhi.
 Indian Organics Chemical Limited, Bombay.
 Orissa Synthetics Limited, Bombay.
 Indorma Synthetics Limited, New Delhi.
 India Poly Fiber Limited, Barabanki.

Source of Acrylic:
 Indian Petrochemical and & corporation Limited, Baroda.

42
  Indian Acrylic Limited, New Delhi.
 J.K Synthetics Limited, New Delhi.
 Pashupati Acryl on Limited, New Delhi.
 Consolidated Fiber and Chemicals Limited, Calcutta.
 Acrylic Fiber, Kota

Source of Viscose
 Grasim industries Limited , Nagada.
 S.I.V Industries Limited Udaipur and Coimbatore

Sources of Black polyester:

 O.T.C., Orissa
 Indian Poly Fibre Limited, Barabanki(U.P)
 J.K Synthetics, Kota.

Inventory Level:
The sources of raw material are away from the company. Therefore,
to avoid the lay offs, the company maintains inventory level for two
three (2- 3) months.
2.4. MILESTONES ACCHIEVED BY CHENAB TEXTILE MILLS.

Sutlej expands Kathua facility

New Delhi, October 31

K.K. Birla Group company Sutlej Industries is expanding its Kathua facility in Jammu
and Kashmir with an investment of Rs 110 crore. “The company is planning to expand its
capacity in Kathua facility Chenab Textile Mills by 28416 spindles with the total cost of
Rs 110 crore,” sources said today. Commercial production of the additional capacity will
start by March 2005. Of the total outlay of Rs 110 crore for expansion, 25 per cent will
come from company’s internal resources while the remaining will be funded by term loan

43
from State Bank of India. For expanding the Kathua facility, Sutlej will get 3 per cent
subsidy on working capital from the Jammu and Kashmir Government, apart from sales
tax exemption for 10 years and refund of premium on insurance. — PTI

2)
Scrip code: 532782 Name: SUTLEJ TEXTILES & INDUSTRIES LIMITED

Subject: Sutlej Textiles - Outcome of AGM

Sutlej Textiles & Industries Ltd has informed BSE that the members at the 2nd Annual
General Meeting (AGM) of the Company held on September 26, 2007, inter alia, have
accorded to the following:
 Adoption of the Directors Report, Auditors Report, the Audited Balance Sheet as
at March 31, 2007 and the Profit and Loss Account for the period ended on that
date.
 Declaration of Dividend @ 4.50 per share on ordinary shares of Rs 10/- each for
the period ended March 31, 2007.
 Re-appointment of Shri. Bodhishwar Rai, Shri. U K Khaitan & Shri. Amit Dalal,
as Directors of the Company.
 Appointment of M/s. Singh & Co., Chartered Accountants, New Delhi, as
Auditors of the Company to hold office from the conclusion of this Annual
General Meeting till the conclusion of next Annual General Meeting of the
Company, on remuneration, terms & conditions.
 Appointment of M/s. S R Batliboi & Company, Chartered Accountants, New
Delhi, as Branch Auditors from the conclusion of this Annual General Meeting
till the conclusion of next Annual General Meeting for auditing the accounts of
Chenab Textile Mills, Kathua (J&K) and the Board of Director of the Company is
authorised to fix their remuneration.
 Authority to the Board of Directors of the Company to contribute to Charitable
and other Funds, not directly related to the business of the Company or the
welfare of its employees any amount, the aggregate of which in any financial year

44
of the Company exceed an amount of Rs 50,000 or 5 per cent of the Company
average net profits, during the three financial year.

45
2.5. PRODUCT RANGE

3. OBJECTIVES OF THE STUDY

Distribution channels play a very important role in achieving the marketing objectives of
the company. Undoubtedly value utility is created by the manufacturer of a product or a
service but time & place utilities are created by distribution channels.

STUDY: - Channels of Distribution of Chenab Textile Mills.

3.1. Objectives of the Study:-.

o To study & analyze the channel of distribution of Chenab Textile Mills.

o To find out the channel levels.

o To study the Production system of Chenab textile mills (kathua)

o To find out the number of intermediaries needed.

o To determine the channel alternatives.

46
 o To study the relationship between Depots & Mill and Agent & Depots.

3.2. RESEARCH METHODOLOGY

1. SOURCE OF DATA COLLECTION:-
Research has collected necessary information to fulfill this report through primary data
and secondary data.
a) Primary Data :-
 This data has been collected from the field work i.e approaching the
distributors (Depot Managers) and agents through the questionnaire.
 Field Work for Primary Data: - The actual fields work as preceded by
market study and through analysing the policy of organisation of
distribution channels.
The discussions made with Mr. Pawan prajapat, about the distribution channels and
the attitudes of Depot Managers and Agents helped to start the field work quickly.
Two separate questionnaires were prepared (one for Depot Managers and another
of Agents) and given to them to find out their views about the distribution channel
of the company.

47
 b) Secondary Data: - This data was collected from the various sources such as
annual reports, business magazines, newspapers, and from company records etc.

 Financial performance of CTM was collected from its annual report.

 From the business magazines and other books on Textile Industry, data was
collected regarding on overviewed of Textile Industry and distribution channel
system.

 Present work force of the company was collected from the company records.

 This data is collected from various sources such as annual reports and books from
the company records.

3.2.1. SCOPE OF THE STUDY:-

The research was conducted at Amritsar, Bhilwara, Delhi, Jaipur, Ludhiana, Meerut,
Panipat, and Bhawani Mandi to study the channels of Distribution of Chenab Textile
Mills (A Birla's Group). Two questionnaires were prepared for this, and were presented
to the Depot Managers and Agents. The purpose behind this was to identify the
appropriate distribution channel and the intermediaries and to know whether they help the
company in meeting consumer needs or not. The area of channel research included:
1) Identify the existing and potential distribution wise channel and unpraising their
relative strengths and weakness in the context of the customer needs.
2) Identifying the appropriate intermediaries for product and determining their number

48
and type.

3.2.2. LIMITATIONS OF THE STUDY:-

1) As the market for the finished products of Chenab Textile Mills is a nation wide, the
Depots are located in almost all the states of India, so it was practically impossible to
survey all the depots of the company.
2) As the topic is vast, time was the main constraint for the study.
3) Senior officers of the company were very busy in their routine schedules and so it was
difficult to convince them to spare sometime from the interview.

4. SOME KEY FACTS AT CTM

4.1 DATA COLLECTION

The various channels of distribution in Chenab textile mills is as follows:-
1. DIRECT SALE:-
These sales are also called Ex-mill sales. It is the sale of goods directly from the company
to the customers, but the payment is made through depots. This sale (Direct sale) covers
approximately 10% of the total sale of the company.
The company produces only industrial products so it has only industrial customers.
Through the direct sale, the company enjoys certain advantages like.
(1) CONVENIENT:-
This method sale is very convenient for the company. The company is able to carry the
twin functions of production and distribution effectively.
(2) INCREASES PROFITS AND SALE:-
The company needs not to give any exps. To middlemen & help the customers to get the
products at comparatively cheap price. This enhances the sales and sales enhances the

49
profits.
(3) PERSONAL ATTENTION:-
By the direct sale, personal attention can be provides to cater the needs of the customers.
(4) DIRECT CONTROL:-
The company can able to enjoy direct control over the distribution of the goods.
(5) MARKET INFORMATION:-
By restoring to direct consumer selling manufacturer establish a direct link with the
customers and can gather valuable information with regard to customer’s response, like
or dislikes, and utility of the products. This information is very help in improving the
products in the future.

2. DEPOT SALE:-
Sales of the goods are done through the various depots opened by the company
throughout the country. This is done in order to save the tax liability as depot transfers
are allowed under the Indian laws. Depot sale covers majority of the sale of Chenab
Textile Mills. It covers about 75% of the total sale of the company.

Chenab Textile Mills is having the depots in the following places

 Amritsar
 Bhilwara
 Ahmedabad.
 Bhawani Mandi.
 Baroda.
 kolkatta.
 Delhi.
 Gorakhpur.

50
  Indore.
 Jaipur.
 Kanpur.
 Ludhiana.
 Kishangarh.
 Meerut.
 Mumbai.
 Panipat.
 Patna.
 Solapur.
 Surat.
The Company is having Four regional offices at the following places.
 Delhi.
 Ludhiana.
 Mumbai.
 Tirupur
3. AGENT SALES:-

Sales of goods are made by the agents to the various customers. These agents works on
the commission basis. This process involves long chain of distribution. Agent is a great
‘facilitating force’ which ensures a steady flow of goods from the initial producer to final
buyers. Agent do not take the title of the goods. They invariably work for the
commission.
In Chenab Textile Mills, Agent sales cover about 15% of the total sale of the company.

4.2. ANALYSIS AND INTERPRETATION OF DATA

51
DEPOT MANAGER’S SURVEY
TABLE – 1
METHOD OF DISTRIBUTION OF THE COMPANY

METHOD NO. OF DEPOTS PERCENTAGE (%)

INDIRECT 1 12.5
DIRECT+INDIRECT 7 87.5
TOTAL 8 100

G
rap
hsho
w in
gth
eme
tho
dofd
istrib
utio
n

1
00

8
0

6
0

4
0

TABLE NO. 2 2
0

0 INFORMATION
SOURCE OF MARKET
in
dire
ct d
ire
ct&
ind
ire
ct

SOURCE NO. OF DEPOTS PERCENTAGE (%)

• M
ETHO
DS
MARKET RESEARCH 2 25
AGENTS 3 37.5
BOTH(MARKET 3 37.5
RESEARCH AND
AGENTS)
TOTAL 8 100

Above figures indicates that in some cases the Depot Managers Obtain market
information through agents only and in some cases they get the market information by

52
wholesalers by market research and as well as by agents also. So the depot managers are
dependent upon market research and agents for the market information.

Graph showing sources of marketing

40
35
30
25
20
15
10
5
0
market agents M.R&
TABLE NO – 3 research
SHORTAGE IN SUPPLY OF GOODS TO DEPOTS

•
SHORTAGE IN SUPPLY NO. OF DEPOTS PERCENTAGE (%)
SOURCES
NOT AT ALL 2 25
FEW TIMES 6 75
TOTAL 8 100

The above table shows that the depot managers face shortage in supply of goods
only to some extent. So there are certain occasional supply lapses, but usually

53
 supply is consistent.

Graphregardingsupply of goods tode

80
70
60
50
40
30
TABLE – 4. 20
PERCENTAGE OF DEPOT SALE TO THE TOTAL SALE
10
PROPRTION IN NO. DEPOTS PERCENTAGE (%)
PERCENTAGE
0
60%-80% 5 not at all 62.5 fewtimes
80%-100% 3 37.5
TOTAL 8 100
• supply
From the above figures, it is analyzed that the Depots sale covers the majority of the sale
of the sale of the company i.e. from 60%-80%

54
 Graph regarding depot sa

70
60
50
40
30
TABLE – 5 20
PROMOTIONAL ACTIVITIES
RATINGS 10 NO OF DEPOTS PERCENTAGE(%)
VERY GOOD 1 12.5
GOOD 3 37.5
FINE 0 4 50
TOTAL 8 60%-80% 100 80%-1
From the above table, it is hereby concluded that the promotional activities of the
company are average. So it is clear that so far as the promotional front as concerned, the
•
company is not going well. SOURCE

55
 Graphregardingratings of promotional a

50

40

30
TABLE-6
RIGIDITY OF COMPANY REGARDING ITS CHANNEL
20
ARRANGEMENT
CHANNEL NO OF DEPOTS PERCENTAGE(%)
10
ARRANGEMENT
ONE BASIC CHANNEL 6 75
0
ARRANGEMENT
verygood good
MODIFY THE CHANNEL 2 25
OF •
DISTRIBUTION RATINGS
FROM TIME TO TIME

TOTAL 8 100

From the above table, it is clear that the company is rigid to one basic channel
arrangement which it is following from a very long time its.

56
 Graphregardingitschannel of arrangem

80
70
60
50
TABLE-7
40
SATISFACTION REGARDING WORKING OF AGENT
30
RATINGS NO OF DEPOTS PERCENTAGES (%)
EXCELLENT 20 1 12.5
SATISFACTORY 10 4 50
AVERAGE 3 37.5
TOTAL 0 8 100
basicchannel modifiedch

The above table depicts that the depot managers are satisfied with the working of the
agents. • SOURCES

57
 Satisfaction level regarding wor

50

40

30

20
TABLE-8
10 TO AGENTS
ADDITIONAL BENEFITS
BENEFITS NO OF DEPOTS PERCENTAGE(%)
YES 7 87.5
NO
0 1 12.5
TOTAL 8 excellent 100 satistactory

• RATINGS
From the above it is hereby concluded that the company provides additional benefits i.e
sales linked incentives, commission, additional discounts to the agents.

58
 Graph regarding additiona

90
80
70
60
AGENTS SURVEY
50
TABLE NO – 1 40
SATISFACTION LEVEL OF AGENTS REGARDING ADDITINONAL BENEFITS
30 NO. OF AGENTS
SATISFACTION LEVEL PERCENTAGES(%)

20 1
FULLY SATISFIED 14.28
10
SATISFIED 4 57.14
UNSATISFIED 0 2 29.58
TOTAL 7 100
YES N

• SOURCE
From the above table that the agents are not completely satisfied with the additional
benefits i.e. sales linked incentives commission, additional discounts, provided by the
company.

59
 Graphregardingsatisfactionlevel of agentsre
additional benefits

60

50

40

30

20
TABLE NO. 2
SATISFACTION
10 LEVEL REGARDING FULFILLMENT OF ORDERS.
LEVEL OF NO. OF AGENTS PERCENTAGE (%)
SATISFACTION 0
FULLY SATISFIED f4ullysatisfied 57.14 satisfied
SOME WHAT SATISFIED 3 42.86
TOTAL • 7 100 RATINGS
Above table indicates that the agents are satisfied with the fulfillment of their orders by
the company thought more than half of the agents seems to be fully satisfied and
remaining i.e. 43% are satisfied only upto some extent.

60
 Graphre

TABLE – 3

PERCENTAGE OF AGENT SALE TO THE TOTAL SALE

PROPROTION OF NO OF AGENTS PERCENTAGE (%)
AGENT SALE TO THE
TOTAL SALE
0-20% 6 85.71
20%-40% 1 14.29
TOTAL 7 100

The above table depicts that the agent’s sales covers less than 20% of the total sales of

61
the company. The company seems to less reliable on agents also.

GRAPHREGARDINGPERCENTAGEOFAGEN
TOTHETOTALSAL
90
80
70
60
50
TABLE – 4 40
30
SOURCE OF INFORMATION REGARDING PROSPECTIVE MARKET
SOURCE 20 NO OF AGENTS PERCENTAGE (%)
DEPOTS 2 28.57
10
DEPOTS AND MARKET 5 71.4
RESEARCH 0
0%-20% 20%-40
TOTAL 7 100

• SOURCES
It is clear from the above table that the agents obtain information regarding prospective
market through depots and market research but there much dependent upon depots for the
information

62
 GRAPHREGARDINGINFORMATIONOFPRO
MARKET
90
80
70
60
50
40
30
20
10
TABLE NO – 5 0
de
RESPONSE FROM AGENTS TO COMPANY’S pots UP ON DELAYED
FOLLOW depotsand
EXECUTION rese
RESPONSES NO OF DEPOTS PERCENTAGE (%)
SUFFICIENT • 3 42.85 SOURCE
INSUFFICIENT OR 4 57.15
LAGGING
TOTAL 7 100

From the above table, it is hereby concluded that the agents are satisfied with the follow
upon the delayed execution to some extent as near half of the response from agents is
sufficient and rest in sufficient.

63
 GRAPHSHOWINGRESPONSESFROMTH
COMPANY ’SFOLLOWUPONDEL

60

50

40

CONCLUSION30

Though the detailed analysis of channels of distribution is very difficult. Yet, I have tried
20
my level best, gathering the information and data from the sources available to come at a
solid conclusion on the basis of the analysis. However following points have come into
light at the end. 10
 Chenab textile mills follow three types of Distribution channels viz. direct sale.
0 Agent sale, for its sales. In Chenab textile Mills, Direct sales
Depot sale and
su
cover approx10% of the total sale of ffic
the ent depot sale covers approxin
company sufficent o
75%
and agent sale covers approx 15% of the total sale of the company .It has been
found out that depot sales cover majority of the sales of CTM. So, the company
•
concentrates on depot sales rather than direct sale and agent sale. RESPONS

 It has been in some cases that agents are not fully satisfied with whatever
gets from the company, in monetary terms or in any other forms of non financial
incentives.

 3. More emphasis is being given to the production side in the company rather

64
 than to marketing side though marketing and sales activities are responsible for
earning revenue for the company.

 Less emphasis is being given on marketing research, which provides the company
with the information regarding the market & its dynamics.

 Product promotion is an area which required to be geared up.

RECOMMENDATION
On the basis of conclusions drawn & enumerated in previous pages, an attempt has been
made to suggest the following recommendations.
 1. The study revealed that marketing is the area which seems to be neglected
because the company products were in great demand. However the scenario is
changing, which makes it necessary for the company to establish a full-fledged
marketing department. The company should change its stance from production
oriented to marketing oriented.

 Presently the company seems to be depending on depot sales but direct sales
marketing and sales through agents are the other avenues available to the
company. Hence the company may concentrate on direct sales marketing through
personal selling or marketing representative follow up with industrial consumers.
Besides promoting the sales through agents who are in the immediate vicinity of
the consumers and also in close liaison rather than depending on the now very old
distribution through depots.

 The company should develop a marketing information system, at present through

65
 its depot managers and existing agents further with the help of personal selling
staff.

 The company is advised to formulate a promotion mix keeping in mind a

changing scenario of market. To begin with, the company may advertise the
product and the company brand in industrial journals like “Textile Asia” & in
future introduce sales promotion through additional agents and personal selling
staff which would constitute a proper mix.

 Company should provide food and Stephen to the trainees.So that the students
give their best effort to make the project in such a way which is beneficial for the
company.

5.4. APPENDIX
KEY INFORMATION POINTS SOUGHT AT TRAINING
(FOR DEPOT MANAGERS ONLY)

We request your cooperation in responding this small questionnaire so as to evaluate us

properly and fairly the channels of distribution which your organization is having, for our
stand purpose only.

NAME:
PLACE:

Q.1 which method of distribution prevailing in your area?

a) Direct marketing.
b) Indirect marketing.
c) Both.
d) Any other (please specify).

Q.2 By which way you get market information?

66
a) By wholesalers.
b) By market research.
c) By agents.
d) All of the above.

Q.3 Do you face any shortage in supply of goods by the company?

a) No, not at all.

b) A few times.
c) Many times.
d) Most of the times.
e) Always.

Q.4 what is the percentage of depots sale to the total sale?

a) 0 to 20 %.
b) 20% to 40%.
c) 40% to 60%.
d) 60% to 80%.
e) 80% to 100%.

Q.5 what are yours views about promotional activites?

a) Excellent.
b) Very good
c) Good
d) Fair
e) Poor

Q.6 whether the company:

67
a) Remains rigid to one basic channel arrangement.
b) Modify the channel of distribution from time to time.

Q.7 Are you satisfied with the workings of your agents?

a) Completely satisfied.
b) Somewhat satisfied.
c) Neither satisfied nor dissatisfied.
d) Somewhat dissatisfied.
e) Completely dissatisfied.

Q.8 Do you provide any type of sale linked incentives, discount, commission etc. to your
agents?

a) Yes
b) No

Q.9 Do you have suggestion to improve the distribution channel?

(FOR AGENTS ONLY)

We request you to extend your cooperation in responding to this questionnaire, so as to

evaluating properly and fairly the channels of distribution which CTM is having, for our

68
study purpose only.

NAME:

AREA:

Q.1 Are you satisfied with the incentives perks commission and discount provided by the
company?

a) Completely satisfied.
b) Somewhat satisfied.
c) Neither satisfied nor dissatisfied.
d) Somewhat dissatisfied.
e) Completely dissatisfied.

Q.2 Are you satisfied with the fulfillment of your orders by the company?

a) Completely satisfied.
b) Somewhat satisfied.
c) Neither satisfied nor dissatisfied.
d) Somewhat dissatisfied.
e) Completely dissatisfied.

Q.3 what is the percentage of agents sales to the total sale?

a) 0-20%.
b) 20%-40%.
c) 40%-60%.
d) 60%-above.

69
Q.4 By which method you obtain information regarding the prospective market?

a) Wholesalers.
b) Depots.
c) Market Research.
d) All of the above.

Q.5 Are you satisfied with the company follow up on delayed execution?

a) Completely satisfied
b) Somewhat satisfied
c) Neither satisfied nor dissatisfied
d) Some what dissatisfied
e) Completely dissatisfied

Q.6 Do you have any suggestions to improve the distribution network?

BIBLOGRAPHY

1) MARKETING MANAGEMENT BY PHILIP KOTLER

70
2) MARKETING MANAGEMENT BY DR. SONTAKKI C.N

3) RESEARCH METHODOLOGY KOTHARI, T MCGREW

4) FUNDAMENTAL OF MARKET L.M PRASAD

RESEARCH

5) JOURNAL TEXTILE ASIA

6) COMPANY CATALOGUE

71