Professional Documents
Culture Documents
ON
Deepak Gupta
Roll no: N08BM51
PGPBM Marketing & Finance (2008-2010)
To the best of my knowledge and belief, this work has not been
submitted by anyone else till date. All the data used for analysis
in this project has been collected first by hand by the student,
during the stipulated time period of the project.
I wish Deepak Gupta all the very best in his future endeavors.
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(Faculty Guide)
Declaration
Deepak Gupta
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Acknowledgement
It would be prudent to commence this report with an expression
of gratitude towards all those who have played an indispensable
role in the accomplishment of this project by providing their
valuable guidance. I would like to take this opportunity to
acknowledge and thank Cargill India Pvt. Ltd. for providing me
with this highly coveted opportunity to associate my Summer
Internship Project with an organization of worldwide repute.
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Table of Contents
Table of Contents......................................................................................................................................5
Criteria ................................................................................................................. 47
Criteria ................................................................................................................. 48
Criteria ................................................................................................................. 48
Executive Summary
This Study gives you an overview of the various aspects related to Distribution &
Sales Management; with emphasis on customers, competitors, dealers and
employees. The study throws some light on the overview of Cargill Foods in India,
as well as in the Global Scenario.
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In India, Cargill has an access over 1000 towns and 2, 50,000 retail outlets. Since
its inception in 1987, Cargill has been a part of Cargill lives with the most
innovative and best quality products.
Cargill Refined Oils India imports, refines, sells and markets a wide range of
vegetable oils and fats to wholesale trade, industrial and household consumers
across India. We own and operate Cargill vegetable oil refining facilities – three
are located on east and west coast ports of India, the other is located in western
India. Refined Oils India markets a range of refined sunflower, soy, palm, olein
and ground nut oils, hydrogenated fats and bakery shortenings under Cargill
national brands, Nature Fresh, Gemini, Purita™\, and other region-specific brands.
The Project given was to understand the impact on business by expanding the
distribution network. The main objective was to expand its distribution network
and to understand its impact. The work was done in stages which were
Introduction
Cargill is an international provider of food, agricultural, financial and industrial
products and services. Founded in 1865, the privately held company employs
159,000 people in 68 countries. Cargill helps customers succeed through
collaboration and innovation, and is committed to applying its global knowledge
and experience to help meet economic, environmental and social challenges
wherever it does business.
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1865
William Wallace Cargill leaves the family home in Janesville, Wisconsin and
becomes the proprietor of a grain flat house in Conover, Iowa. The flat house, a
type of warehouse that preceded country elevators, was at the end of the McGregor
& Western Railroad line.
1867
1868
1870
1884
John H. MacMillan, 15 years old, goes to work in his father's bank in La Crosse,
Wisconsin. W. W. Cargill & Bro. in La Crosse is formally separated from
Minnesota and the Dakotas by the establishment of Cargill Brothers in
Minneapolis.
1885
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The three Cargill brothers own or control 102 structures in Minnesota and the
Dakotas (and smaller holdings in Iowa and Wisconsin) with a total grain capacity
of over 1.6 million bushels. By this time, Minneapolis and Duluth are identified as
prominent grain centers.
1887
W. W. Cargill forms the Sault Ste. Marie Land Company to take advantage of
the growth expected after the Soo Line railroad connected the lock area with
Minneapolis. Sam Cargill leaves La Crosse to manage the Minneapolis, Minnesota
office.
1890
The Minneapolis operation, under the direction of Sam Cargill, drops the "Cargill
Bros." name and incorporates under Cargill Elevator Co.
1891
Three MacMillan brothers, John H., William D., and Daniel D. move to Fort
Worth, Texas, to set up a grain business under the name D. D. McMillan & Sons.
1892
1903
1908
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Railway, a dam, and the creation of the town of Valier. The project is not
profitable and begins to stress the finances of the La Crosse grain business.
1911
A portion of the assets of Sawyer and Austin Lumber Company is sold to raise
funds. The mineral rights to the Arkansas land are retained, and eventually leased
to American Bauxite Company, generating much needed cash through 1922.
1922
Julius Hendel joins the Cargill organization and takes charge of the newly
established grain laboratory in Minneapolis. The grain lab will become one of the
most respected private laboratories in the country. Hendel's laboratory study on
flour appears the following year in the North-western Miller.
1926
A fire in British Columbia destroys the logging camp. Austen Cargill returns to
Minneapolis and becomes head of the Cargill Commission Department, focusing
his attention on the management of the company's country elevators.
1927
Cargill leases the 1.5 million bushel Superior elevator in Buffalo, New York and
another elevator at Port McNicoll, Ontario, beginning its reach eastward. John
MacMillan, Jr., marries Marion Dickson.
1999
The University of Minnesota receives $10 million from Cargill to expand the
university’s work in the emerging field of microbial and plant genomics.
Cargill launches Strategic Intent, which involves positioning the company so that
“by the year 2010, Cargill will be the recognized global leader in providing
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agrifood chain customers with solutions that enable them to succeed in their
businesses.”
2000
2003
Cargill’s earnings surpass US $1 billion for the first time in its history. Cargill
adds to its chocolate portfolio with the acquisition of Peter’s Chocolate, a brand
dating from the 1880s, and OCG Cacao, a European maker of industrial chocolate.
Cargill’s global giving exceeds US $22 million.
2004
Cargill Fertilizer and IMC Global combine to form a publicly traded firm, The
Mosaic Company. Cargill acquires The Duckworth Group, a UK-based flavour
house. Cargill Animal Nutrition has a presence of 163 plants in 22 countries.
Cargill announces an agreement to acquire Seara Alimentos, a major Brazilian
poultry and pork producer.
2005
Cargill India and Parakh Foods enter into a joint agreement to produce and market
vegetable oil. Black River Asset management, a global asset management
company, is launched. Ocean Transportation Unit ranked No. 1 in dry bulk freight
by Risk magazine (February 2005). Cargill purchases Romanian edible oil
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producer Olpo, expanding its investment in the Black Sea region. Cargill opens
first office in Dubai, United Arab Emirates.
Despite its size, the corporation is still a family owned business; descendants of the
founder (from the Cargill and MacMillan families) own about 85% of the
company. This means that most of its growth has been due to reinvestment of the
company's own earnings, rather than public financing. Greg Page is the chief
executive officer of Cargill; he succeeded Warren Staley in mid 2007.
Cargill's quarterly profits crossed $1 billion for the first time during the quarter
ending on February 29, 2008 ($1.03 billion); the 86% rise was credited to global
food shortages and the expanding biofuels industry that in turn caused a rise in
demand for Cargill's core areas of agricultural commodities and technology. It is
an INVISIBLE GIANT which is grooming day by day.
CARGILL PRESENCE
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Europe
Asia Africa
• Australia • Cote d'Ivoire
• China • Ghana
• Kenya
• India
• Malawi
• Indonesia
• Morocco
• Japan
• Nigeria
• Malaysia
• South Africa
• Pakistan • Tanzania
• Philippines • Zimbabwe
• South Korea
• Singapore
• France America
• Federation
• Germany • Spain
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• Greece • Sweden
• Hungary • Switzerland
Central South
America America
• Bonaire • Argentina
• Costa Rica • Bolivia
• Dominican • Brazil
Republic • Chile
• Guatemala • Colombia
• Honduras • Paraguay
• Nicaragua • Peru
• Uruguay
• Venezuela Page | 13
Vision
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Businesses of Cargill
Five major business segments
Expertise
Core competencies
• Risk management
Deep knowledge and thought leadership within these competencies has come from
deliberate investments over time, and has forged a strong competitive advantage
we can share with Cargill customers.
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Supply chain management
Moving massive amounts of raw materials from continent to continent and farm to
factory is both art and science. For more than 100 years, Cargill has been shaping
its supply chain management capabilities to the point where there are few equals in
the world in terms of the volume and breadth of materials we move, the numbers
of customers we serve, and the significant numbers of partners we team with.
• Improved revenues
Risk management
In today’s volatile markets, Cargill customers look for a steady hand of experience
to help them manage their exposure to price risk. For years, Cargill has been
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identifying, measuring and managing its own exposure to risk. We also offer this
service to Cargill customers.
We work with you closely to measure Cargill exposure to risk and quantify Cargill
risk tolerance. Then we develop and execute sound strategies that diminish the
volatility. By managing Cargill risk as if it were Cargill own, we help you keep
costs within an established range and preserve the potential to capture the upside
of an opportunity.
Analytical tools
Cargill has a broad range of analytical tools by which we measure and assess price
risk. To be sure, risk management is one of Cargill company’s core capabilities.
Every day, we buy and move large volumes of commodities from where they are
produced to where they are needed. Cargill ability to provide risk-managed supply
chains makes us a reliable supplier to you.
Cargill customers turn to Cargill for Cargill scientific expertise when the challenge
is enhancing an existing product, improving process efficiencies, or uncovering a
solution that helps them launch a first-to-market innovation. Cargill goal is to
leverage Cargill research and development capabilities to generate distinctive
value through new, improved products and innovative ways to reduce costs or
both.
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Cargill global team includes more than 1,300 research, development, applications,
technical services and intellectual property specialists working in more than 200
locations. Together, they provide a spectrum of services encompassing technical
service, applications, development, research, intellectual asset management, and
scientific and regulatory affairs.
We can provide the people, capabilities and facilities to solve virtually any
technical challenge across a range of industry segments, including:
• Food ingredients
With R&D centers in Europe and North America and applications and technical
services professionals in locations across the Americas, Europe, the Middle East,
Africa, and Asia, Cargill has a window on the world. Cargill global presence
enables us to stay at the forefront of emerging customer needs and solutions and
bring important new knowledge to you. In addition, the breadth of Cargill
technical expertise enables us to leverage technologies developed in one area to
solve customer challenges in others. For example, Cargill deep knowledge of
animal nutrition is informing solutions for human nutrition. Cargill ability to
immediately tap Cargill technical expertise across businesses and disciplines
around the world allows us to leverage Cargill best, most relevant knowledge to
solve problems quickly. This access to Cargill’s world of scientific and technical
knowledge helps avoid the time and cost of reinventing — and allows you to move
Cargill product to market more quickly.
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Cargill’s strong regional presence enables us to provide customers with the
applications and technical services support to create products tailored to local
tastes and cultures. Few, if any companies, can provide both global R&D support
and regional solutions that we can.
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FMCG in India
Products which have a quick turnover, and relatively low cost are known as Fast
Moving Consumer Goods (FMCG). FMCG products are those that get replaced
within a year. Examples of FMCG generally include a wide range of frequently
purchased consumer products such as toiletries, soap, cosmetics, tooth cleaning
products, shaving products and detergents, as well as other non-durables such as
glassware, bulbs, batteries, paper products, and plastic goods. FMCG may also
include pharmaceuticals, consumer electronics packaged food products, soft
drinks, tissue paper, and chocolate bars.
India’s FMCG sector is the fourth largest sector in the economy and creates
employment for more than three million people in downstream activities. Its
principal constituents are Household Care, Personal Care and Food & Beverages.
The total FMCG market is in excess of Rs. 85,000 Crores. It is currently growing
at double digit growth rate and is expected to maintain a high growth rate. FMCG
Industry is characterized by a well established distribution network, low
penetration levels, low operating cost, lower per capita consumption and intense
competition between the organized and unorganized segments.
Growth Prospect
Large Market
India has a population of more than 1.150 Billions which is just behind China.
According to the estimates, by 2030 India population will be around 1.450 Billion
and will surpass China to become the World largest in terms of population. FMCG
Industry which is directly related to the population is expected to maintain a robust
growth rate.
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Spending Pattern
An increase is spending pattern has been witnessed in Indian FMCG market. There
is an upward trend in urban as well as rural market and also an increase in
spending in organized retail sector. An increase in disposable income, of household
mainly because of in-crease in nuclear family where both the husband and wife are
earning, has leads to growth rate in FMCG goods.
People are becoming conscious about health and hygienic. There is a change in the
mind set of the Consumer and now looking at “Money for Value” rather than
“Value for Money”. We have seen willingness in consumers to move to evolved
products/ brands, because of changing lifestyles, rising disposable income etc.
Consumers are switching from economy to premium product even we have
witnessed a sharp increase in the sales of packaged water and water purifier.
Findings according to a recent survey by A. C. Nielsen shows about 71 percent of
Indian take notice of packaged goods labels containing nutritional information
compared to two years ago which was only 59 per cent.
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Advantages To The Sector
Governmental Policy
Market Opportunities
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Rural India accounts for more than 700 Million consumers, or ~70 per cent of the
Indian population and accounts for ~50 per cent of the total FMCG market. The
working rural population is approximately 400 Millions. And an average citizen in
rural India has less than half of the purchasing power as compare to his urban
counterpart. Still there is an untapped market and most of the FMCG Companies
are taking different steps to capture rural market share. The market for FMCG
products in rural India is estimated ~ 52 per cent and is projected to touch ~ 60 per
cent within a year. Hindustan Unilever Ltd is the largest player in the industry and
has the widest market coverage.
Cheap labor and quality product & services have helped India to represent as a cost
ad-vantage over other Countries. Even the Government has offered zero import
duty on capital goods and raw material for 100% export oriented units. Multi
National Companies out-source its product requirements from its Indian company
to have a cost advantage. India is the largest producer of livestock, milk,
sugarcane, coconut, spices and cashew apart from being the second largest
producer of rice, wheat, fruits & vegetables. It adds a cost advantage as well as
easily available raw materials.
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Swot Analysis of FMCG Sector
Strengths:
Weaknesses:
Opportunities:
Threats:
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Cargill in India
In India, Cargill has an access over 1000 towns and 2, 50,000 retail outlets. Since
its inception in 1987, Cargill has been a part of our lives with the most innovative
and best quality products.
• Animal Nutrition
• Coal
• Cotton
• Flavor Systems
• Ferrous
• Grain & Oilseeds
• Refined Oils
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Cargill milestones in India
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• Cargill enters into a joint venture in a project for
setting up a green field sugar refinery in South
India.
• Cargill entered into tolling arrangements with local
Soybean crushers in Maharashtra, Rajasthan and
Madhya Pradesh.
Cargill Animal Nutrition develops and markets a broad range of animal feeds and
customized animal productivity solutions to commercial producers throughout the
world.
Coal
We carry out agency business or support business of our associates. Cargill Coal is
one of our fastest growing businesses. We are active across physical and financial
markets in both coal and freight—and recognized as a market leader in risk
management and logistics.
Cotton
Cargill Cotton merchandises cotton worldwide. Cargill Cotton services growers,
ginners, buyers and textile mills worldwide through our network of buying, selling
and shipping offices.
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Ferrous
We carry out agency business or support business of our associates. Cargill India is
amongst the largest ferrous exporters in the country, covering the whole of Asia,
Middle East, Europe and North and South America.
Flavor Systems
Cargill’s Grain & Oilseed business in India sources, trades, processes and
distributes grain and oilseeds. The main bulk products handled are wheat, corn,
oilseeds, barley and sorghum, as well as vegetable oils and meals.
Ocean Transportation
We carry out agency business or support business of our associates. Cargill Ocean
Transportation offers customers a number of ocean freight solutions across all dry
market segments and tankers.
Refined Oils
Cargill Refined Oils India imports, refines, sells and markets a wide range of
vegetable oils and fats to wholesale trade, industrial and household consumers
across India.
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Cargill Refined Oils
Cargill Refined Oils India imports, refines, sells and
markets a wide range of vegetable oils and fats to
wholesale trade, industrial and household consumers
across India. We own and operate three vegetable oil
refineries located at Paradeep (Orissa), Kandla (Gujarat)
and Kurkumbh (Maharastra). Cargill Refined Oils India
has been operating within India since 2005 and employs more than 750 people.
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• Specifications that not just ensure superior quality but also high stability
without addition of preservative chemicals. No oil that does not meet these
specifications is ever packed or shipped.
• Hands free treatment with no direct human touch on the product itself due to
fully automated refining technology. This has led to a very clean and
hygienic environment and a better and safer product.
Nature Fresh Acti-Lite refined oils always ensures that you stay light and active.
Now its verified! With added DMPS (a permitted antioxidant as ingredient), lab
results have shown that food cooked in Nature Fresh® Acti-Lite refined oils,
absorb less oil as compared to food cooked in ordinary oils. So now we can
indulge in our favorite foods without guilt, knowing that you have the trusted
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quality of Cargill. Nature Fresh is available in refined soybean and refined
sunflower oil.
Benefits of DMPS:
Nature Fresh Acti-Lite Refined Oils are made using lightness Integrated Technique
(LITE), which ensures that consumer, gets the lightest oil that is easy to digest.
The oil is refined in the technologically advanced processing plants to ensure that
the best attributes of the oil are preserved for your health.
• Nature Fresh Acti-Lite Refined Oils now comes with fortified with the
goodness of Vitamin A, D and E.
• Nature Fresh is available in refined soyabean and refined sunflower oil.
• The low absorption results have been tested and verified by two renowned
government laboratories. Lab studies have proven that food cooked in
Nature Fresh Acti-Lite refined oil with DMPS absorbs less oil as compared
to food cooked in ordinary oil.
• “Consumer Voice”, a government funded voluntary organization working
towards consumer education and awareness announced Nature Fresh Acti-
Lite along with Gemini as the best quality and healthiest sunflower oils in
the country.
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Gemini refined cooking oils retain the freshness of the oil from the time it is
packed to the time it reaches the consumer. This is possible by the unique
Freshness Intact Technique- a unique packaging technology that preserves the
benefits of the oil.
Cooking oil starts loosing its freshness after refining or during storage and
packaging as well as due to air contact.
To get oil that has its freshness intact, only Gemini Refined Cooking Oil uses FIT
technology. Using this technology, the oil after refining is stored under controlled
atmosphere right through packaging. Also when it is packed, a protective shield of
nitrogen is created above the oil, inside the pack. This ensures that Gemini Refined
Oil retains its freshness unlike any other refined oil. When we cook our food in
FIT empowered Gemini Refined Oil, the food remains fresh for longer period of
time.
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NatureFresh Purita is renowned for its purity and taste. With a pungency level of
0.27%, which is higher than the highest AGMARK standard of 0.25%,
NatureFresh Purita is the best oil for cooking your favorite fried dishes.
NatureFresh® Purita ensures that your family is full of vigor and health.
Mustard is used as multipurpose oil. So whether it be cooking or pickling, mustard
oil is prefered across.
• NatureFresh Purita Pure Mustard Oil is considered as one of the healthiest
edible oils. It has the lowest amount of saturated fatty acids and a high
amount of monomustard and polyunsaturated fatty acids, that are
considered good for a healthy heart.
• Mustard oil has an ideal ratio, close to 10:1 of Omega-3, which is known to
prevent cancer of the colon and stomach and Omega-6 Fatty Acid
composition (Linolic and Alpha Linolic Acid respectively), which are
essential for health and metabolism.
• Many research studies recommend mustard oil as the best oil for Indians. It
contributes to a lower risk for heart attack, almost half in comparision to
any other oil.
• A good mustard oil has a strong flavour and aroma, which is known in the
market as pungency or jhanjh. Higher the pungency better is the oil.
• Cargill uses “Grade A” seeds to extract the best quality mustard oil, which
ensures the highest level of pungency.
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Cargill nurtures more than 200 million olive trees in Spain and brings the goodness
that makes cooking food, a truly exotic delight.
“ The most exotic olive oil from Spain”
Presenting another gem from the NatureFresh stable – NatureFresh Oliante, the
most exotic olive oil from the land of Antequera in Spain.
In an era where anything and everything is commercialized, the olives of
Antequera continue to preserve their absolute communion with Mother Nature that
has existed for centuries. NatureFresh Oliante comes from the olive trees over 600
years old. The oil takes three years of patient processing and what you get is the
healthiest and most exotic olive oil.
The handpicked olives that go into the making of NatureFresh™ Oliante remain
almost unaffected by time, true to their age and barely touched by modern
technology. Nurtured in such a land makes NatureFresh Oliante truly exotic.
With four processing locations in Spain, Cargill produces more than hundred
thousands of olive oil every year, which makes Cargill the largest producer in the
world. In fact, it is 5 times bigger than the closest second.
The process that begins at Antequera in Spain, with nurturing of olive trees and
ends when the olive oil is packaged, is fully owned and managed by Cargill.
In an era, where anything and everything is commercialized, olives of Antequera
continue to preserve their absolute communion with the Mother Nature that has
existed for centuries.
Variants
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• Extra Virgin Olive Oil is the highest of olive oil. To bring out the delicate
flavour in the first press, a panel of Cargill experts judges the olive for the
taste, mouth feel and aroma to bring you NatureFresh Oliante Extra
Virgin Olive Oil.
• Pure Olive Oil comes from the refining process of olive oil named
“Lampante” and is added with a percentage of Extra Virgin Olive Oil. Pure
Olive Oil is good for all kinds of high heart cooking.
• Pomance Olive Oil is a blend of Extra Virgin Olive Oil and refined
Pomance Oil. This oil is a very good baking and frying medium.
What’s more, Gemini now comes with the nutritional fortification of Vitamins A,
D and E. The benefits of vitamins ensure that your family stays healthy and fit.
Available in refined soybean, sunflower, groundnut and cottonseed, filtered
groundnut and mustard oils and vanaspati, Gemini is now the largest selling edible
oil brand in Maharashtra.
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Presence of Cargill in India
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Edible Oils in India
India is the largest importer of edible oil and the third largest consumer (after
China and Europe). Of the total 5.0-5.5 million tons of vegetable oils imported by
India annually, 1.3-1.5 million tons is soyabean oil, imported mostly from
Argentina, Brazil and United States, nearly 3 million tons of palm oil is purchased
from Malaysia and Indonesia. Palm oil imported into India is used in various
forms-consumed directly as “palm oil” after refining, used in the manufacture of
vanaspati, for blending with other vegetable oils, raw oil and kernel oils for
industrial purposes. Per Capita consumption is around 10 kg/year. Palm and
Soyabean oil account for half of the total edible oil consumption in India followed
by Mustard and Groundnut Oil.
The share of raw oil, refined oil and vanaspati in the total edible oil market is
estimated as 42%, 48% and 10% respectively (Department of Food and Public
Distribution, GOI). India has close to 9% of global oil seeds production, making it
the largest producers of oilseeds in the world. Over 40% of the total volume of the
edible oil sold in India being imported in 2005.
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List of Edible Oil players in India
Fortune Adani Wilmar Limited.
NatureFresh, Cargill India Pvt Ltd, USA
Gemini
Dalda Bunge India Pvt.Ltd.,USA
Saffola, Marico Ltd, India
Sweekar,
Parachute
Sundrop Agro Tech Foods Ltd(ConAgra Foods)
RR Primo RR Oomerbhoy Pvt.Ltd.
Dhara Dhara Company Ltd, NDDB Campus, Anand
Panghat Mawana Sugars Ltd.
Tilsona Recon Oil Industries Private Ltd
Figaro Consumer Marketing (India) Pvt. Ltd
Shalimar's Shalimar Agro Tech Pvt
Classic
Basmati
Palm Sarda Agro Oil Ltd.
Gold Active
Ruchi Gold Ruchi Infrastucture Ltd
In edible oil The Adani-Wilmer owned Fortune brand was India’s number one
edible oil in 2006 according to A C Neilson Retail Audit 2006. Fortune, which is
present as a refined soyabean oil, sunflower oil, groundnut oil and mustard oil is
said to have a market share of 19% in the entire edible oil market.
Marico Industries have a market share of 13 % with brands like Saffola and
Sweekar together.
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Salient features of Indian Oil Sector
1) Demand increasing due to population growth and income increase.
2) Domestic production of oilseeds/oils is not adequate to meet the
demand
3) Lower yield
4) Fluctuating production of oilseeds
5) Low capacity utilization of processing units
6) Obsolete technology/processing inefficiency
7) High import dependence about 40%
8) Speculative nature of trade
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based assistance to farmers of eliminate
unofficial markets.
Future • In the next five years, the market for
- edible oils will grow by 8% to 12.65 million
MT
- vanaspathi will grow to 1.5 million MT
Business concerns • Free imports, low import duties and slump in
global prices - lead to `dumping’
• Domestic industries of edible oils and
vanaspathi affected - low realisation and idle
capacities in oil and vanaspathi industries
• Production slippages have also forced imports
• Excessive (cheap) imports of oilseeds - led to
unremunerative prices, locally
• Hence, farmers have shifted to other cash crops
• Increasing health awareness - impact of oils and
vanaspathi usage on individual’s cholesterol
levels
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opportunities because of consumers’ preference for traditional oils such as
groundnut oil, mustard oil, sesame oil etc. For example, newer oils like soyabean,
sunflower, ricebran and cottonseed and oils from oilseeds of tree and forest origin
had found their way to the edible pool largely through vanaspati route. Of late,
things have changed. Through technological means such as refining, bleaching and
de-odouraisation, all oils have been rendered practically colourless, odourless and
tasteless and, therefore, have become easily interchangeable in the kitchen. Newer
oils which were not known before have entered the kitchen, like those of
cottonseed, sunflower, palm oil or its liquid fraction (palmolein), soyabean and
ricebran. These tend to have a strong and distinctive taste preferred by most
traditional customers. The share of raw oil, refined oil and vanaspati in the total
edible oil market is estimated at 35%, 55% and 10% respectively.
( In lakh Tonne)
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Distribution Channel of Cargill India Pvt.Ltd.
Manufacturer
(C&F)Depot
Wholesaler
Retailer
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Consumer
The end-users of the products are: households and institutional buyers
[catering/hospitality/processed food/snacks] set-ups. Cargill has set up a strong
distribution network of Company Distributors and super stockists for its retail
operations. This chain helps to tap even the small retailers/traders and thus
increases their reach.
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Hierarchy Structure of Cargill India Pvt. Ltd.
Chairman
Director
Sales Officer
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Interim Sales Representative
Swot Analysis of Cargill India Pvt.Ltd.
Situation being analysed: During the Summer Interns Project in Cargill India Pvt.Ltd.
Distributor Salesman
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Location and technology and activities,
geographical? achieving distraction?
economies of
Price, value, scale especially Reliability of
quality? in the small data, plan
sector. predictability?
Accreditations,
qualifications, Morale,
certifications? commitment,
leadership?
Processes,
systems, IT, Accreditations,
communication etc?
s?
Processes and
Cultural, systems, etc?
attitudinal,
Management
behavioural?
cover,
Management succession?
cover,
succession?
Philosophy and
values?
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Global Growing products, intentions -
influences? consciousness which illegally various?
for healthy oil mimic the
New markets, could well lead labels of the Market
vertical, to high sales of established demand?
horizontal? packaged brands.
edible oil. New
Niche target technologies,
• Competitors
markets? services, ideas?
• Can expand its must be eyeing
Geographical, business in on similar Vital contracts
other FMCG opportunities
export, import? and partners?
products
New USP's? Sustaining
internal
Tactics: eg,
capabilities?
surprise, major
contracts? Obstacles
faced?
Business and
product Insurmountable
development? weaknesses?
Partnerships, Sustainable
agencies, financial
distribution? backing?
Volumes, Economy -
production, home, abroad?
economies?
Seasonality,
Seasonal, weather
weather, effects?
fashion
influences?
Page | 49
Understanding The Impact On Business By
Expanding The Distribution In Mass Market
6) Sales officer- The sales head of a certain territory who manages and
co-ordinates the sales within that particular territory.
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7) ISR- Interim Sales Representative. Employees of the company and on
the payroll basis. They carry out the sales operation in a particular
territory.
9) CP- Consumer Pack. This includes all the types of packing like 1 ltr
pouch, 5 ltr and 15 ltr jar excluding the tin packings.
10) BP- Bulk Pack. This includes commercial packing like 15 ltr & 15 kg tins.
11) Primary Sales- Sales of goods from the depot of the company to the
super stockist or the distributors.
12) Secondary sales- Sales of goods done from the distributors or super
stockist to the wholesalers or retailers.
14) Unproductive outlets- Outlets not selling products of Cargill India Pvt. Ltd.
15) Sales Call- Visiting the respective outlets on a specified beat to take their
respective orders.
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Project Objectives
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• Tracking of outlets: - Listed and new outlets were being tracked by
maintaining a record and calculating the average sales per outlet.
• Pre & Post Volume Analysis: - analysis of the sales volume pre and post of
our project.
• 1 Sales Officer
• 1 Super Stockiest
• 12 Distributors
• 7 Distributor Salesman(Dsm)
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METHODOLOGY
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Analysis of Existing Outlets……..
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• Revised the list of each beat
The first step towards our objective was to know where we actually stand
today. Initially we had 39 beat in West delhi. So every day I had to visit
each beat with respective dsm or isr. Firstly one has to check the list whether
the entire store listed are correct or not. One more thing was very important
was to add the newly opened retail outlets to the list and eliminate the retail
store which closed their business or store which doesn’t sell the refined oil
any more. So a revised new beat list was prepared after visiting all the beats
of West Delhi.
After making the revised beat list the total number of outlets and total
distribution was found. Total number of outlets of West Delhi was 1804 and
distribution came to be 1393. Now have to make a plan to make the
unproductive counters productive by analysis of each beats. Beat having
more unproductive counters have to be aim first. Understanding buying
behavior and the problem faced by Dsm or Isr in converting the
unproductive counters and then come up with a solution.
The main objective of the project was to increase the distribution that is to
increase the total number of productive outlet. So after analyses of each beat
I had the information of number of unproductive outlets in each beat. So
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there was a each day plan for every Isr and dsm. Plan was divided into three
steps. First step was that every day Isr or dsm have to attempt for
converting the unproductive counter into productive in their regular beat.
For new productive counters they were given an extra Schemes benefit like
power of reducing the rate from 5 Rs to 10 Rs per box, cash display on 5
litres jar of Nature Fresh Acti lite and Nature fresh Sunflower oil and credit
facility in case required. And then also if Isr or Dsm was unable to convert
some outlet into productive then they must write down the name of that
outlets and the problem they faced. For second step of plan I can go with
him and give a brief presentation on Nature Fresh and Gemini. As the main
strength of our product is the quality of product which we offer, the brand
name NATURE FRESH. So the brief presentation emphasized more on its
quality and benefits which we offer at affordable price and how our products
differentiate from other competitors. I tried my best in persuading the shop
owner to sell our product. But then also if I was unable to convert that outlet
then there comes step 3rd of our plan. Third plan included a full team visit to
that outlet for making sure that outlet must sell our products.
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Discovering the Uncovered Area……..
After preparing the revised beat list there was a need to know the uncovered
area of West Delhi. So with the help of whole team of West Delhi and road
map, we highlighted the uncovered areas which need to be covered. The
main area which was discovered as uncovered or partially covered of West
Delhi was Mohan Garden, Om Vihar, Chander Vihar, Nawada, Hastal
Village, Uttam Nagar, Sitapuri, Chanakya Place, Indra Park, Bindapur
Matiyala Road, Rajapuri, Vikaspuri.
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Design a Optimum Distribution Network for
Uncovered Area……..
• Listing of outlets
The First step towards designing the distribution network for uncovered area
is to know that how much potential particular market has. So to know the
potential, the listing of retail outlets was done. Total new Listing done in
uncovered area was of 780 shops.
After listing down the new outlets, a route map was design and then new
beats was made of about 35 to 45 stores. Total of 780 new retail outlets was
divide in 20 new beat according to the beat route designed. Some old beats
was also restructured to include new stores which was listed. Basic idea
behind making a beat plan was to know the actual potential of the uncovered
area. Secondly how many new beat we have got and how much more
manpower we will be needed to cover that beat.
As now we know the potential of the uncovered area, now we have to focus
on the main aspect of distribution that is Who will provide regular supply to
that area. To ensure better supply, distributer must be the one who is locally
aware of that area, must have a good creditworthiness. We made two new
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distributers Achiever Sales Corporation and Jai Ambe Enterprise to cover
new area. Out of 20 new beat we gave 14 beats to Achiever Sales
Corporation, 5 beat to Jai Ambe Enterprise and 1 beat to the old distributer
Himmatram & Co.
• Recruitment
• Launching of Product
As the area was uncovered earlier there was a need to make aware about the
product to the shop owners. Now we have beat plan, manpower and
distributer to ensure regular supply. Therefore a launching exercise was
done. In launching exercise a team was made of 3 to 4 person. Work of this
team was to visit each retail outlet and give a brief presentation of the
company and its products. Major emphasize in presentation is given to the
quality of our product, benefits and how our product differentiates itself
from our competitors. One person makes sure that posters and danglers of
the product are pasted and hooked properly in order to increase visibility of
our product. Launching exercise by a team has very much importance as the
first visit of company to the retail outlet makes the shop owner think
differently and we can persuade him easily to sell our product. Team visit
has more impact on the shop owners than a single salesman going to convert
the first sales call into productive call. In the area of Mohan Garden, Om
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Vihar, Chander Vihar we got great success in terms of productivity of about
70 to 80 percent at the time of launching. The main reason for our success in
this region was that no refined oil company’s distribution had a direct
service to this area. Direct service was available to selected big outlets only
and rest of other outlets depended on wholesale market. Therefore success
ratio was high as we are assuring our regular service and supply direct to
their shop without any mediator like wholesalers.
Once an outlet started selling Nature Fresh or Gemini, now its very
important to take necessary steps for making them to sell our product
regularly. So we have to set a mechanism for sustenance of these new
productive outlets.
• Regular Visit :-
Main aspect for sustenance of new productive outlet is the regular sales visit
of Dsm or Isr to that outlet. In an FMCG company, visits to retail outlets are
weekly, thereby continuing a good relation with a particular outlet.
• Supply Mapping :-
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If the salesman goes regularly and takes order from X retailer. And due to
some problem with that X retailer, the distributer doesn’t supply the order.
So there must be some proper mechanism to check, whether the order
received is supplied on time or not. The respective Dsm or Isr must check
regularly from the distributor that the order taken by him for each beat is
supplied or not. If not then he should try to find out the problem and try to
come up with a solution.
• Aggressive Promotion :-
If our product visibility is increased, the end consumer will get to know our
product better. It creates a demand from the consumer side which will force
the retailer to sell our product. Therefore chances of the sustenance of the
new productive outlets go very high. There are many ways to increase
visibility. Some Major ones which are used by the company are T V
Commercials, Print ads, Hoarding, Posters & Danglers, Standee cut out, In
Shop branding, Road shows, Car Screens etc.
Trade promotion: The Company will have to offer lucrative trade promotion
schemes, in order to push primary sale. These include incentives to stockists for
pushing the sale of oil. At the retail level, the following trade promotion measures
may be adopted:
• Shop Displays
Consumer Promotion: Some of the consumer offers that could be introduced are:
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• Free gifts like pen, soaps etc., on return of oils wrapper
• Money Savers
• New Schemes :-
Launching of our product in any new outlets and then to sustain them
required some new schemes offered to the shop owners with some cash
display benefits and other offers. We can offer free gifts with bulk purchase,
cash display benefits like 25Rs off with the purchase of 5 ltr or 15 ltr Jar
packing provided if they keep that jar in the most visible place of the shop.
This helped us to push our product into the market creating the visibility of
our product that we wanted and the retailer will get price benefits. At present
company is going with a Quantity Purchase Scheme(QPS) with a name
CARGILL RETAILORS LEAGUE 2 in which if a retailor purchase a
product of cargill, he will get a some run allocated according to the product.
And after 3 months the retailor will get the prize corresponding to the run he
scored in three months.
Tracking Of Outlets……..
As per the specific beats, beat list were maintained containing all the outlets
in that particular beat. We had to list all the outlets in our specified territory
along with the monthly sales. Herein we calculated the average sales per
outlet and found out which outlet was lacking sales and which were still
unproductive. Thereby we differentiated outlets in category A, B and C
depending on their sales.
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After converting unproductive retail outlets to productive once, there is a
need to track these outlets. We should know how many new productive
counters became our regular customers and how many counters didn’t
purchase then after. So a tracking sheet was prepared to track the weekly
sales of all counters. Then after monthly new outlet analysis exercised was
done in order to know how many new outlets have become regular customer
of our product. Below is the sample sheet of new outlet analysis exercise
NewOutlet AnalysisExercise
Territory:- West Delhi SalesOfficer :- ChandanSingh
No. of No. of
Total no. No. of No. of
O/L O/L
ISR/DSM of new O/LNot O/L Total Sales
billed billed
O/L billed billed>2
once twice
NitinSharma 26 3 16 7 7 572
Praveen Sharma 137 29 114 18 5 5510
Satyender Mishra 48 14 14 17 17 3719
Manoj 24 10 10 14 0 2259
Shekher Suman 187 48 61 54 72 10066
Mithun 25 3 15 4 6 925
Md Noorudin 161 32 101 0 0 4589
VivekKumar 101 0 101 0 0 1192
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TOTAL SALES OF NEW OUTLETS WERE 95465 Litres
This chart help us to know about total sales of new outlets of different territories.
This is necessary for Cargill to track the sales of newoutlet and to know how these
new outlets are performing to improve sales of NATUREFRESH.
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Pre & Post Volume Analysis……..
Initially West Delhi had 1804 outlet listed out of which distribution was
with 1393 outlets and the average sale earlier was around 120 Metric Ton.
But after completion of the project the total distribution increased by
53.27% and Average monthly sale by 35%. So we can see that the project
was successful in raising overall sales.
StatusofWestDelhi
Total Total
AvgSale(MT)
Outlets Distribution
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Per Dealer Off Take(PDO) is the monthly average sale of all retail outlet divided
by the total number of productive outlets.
PDO (per dealer offtake) Before = Total Sale of All Retail Outlet/Total
Number Of Productive Outlets
= (120000/0.910) liters/1393
= 94.66 liters/dealer.
= 83.38 liters/dealer.
So we can deduce that after increasing our distribution, our per dealer outlets is
reduced. So something needs to be done to increase PDO After to the level of PDO
before.
2) Leakage problem should be taken care of and the retailers should be full
compensated for their loss due to leakage.
3) There must be regular surprise visit of higher officials to check the ground
realities in the market.
4) There should be separate person in the market whose only job must be
merchandising. He must make sure the product is visible in the outlet and postors
and danglers are properly pasted and attached at a proper place.
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made aware of it. Sales representatives should be given guidelines to intimate each
and every retailer of his area about the schemes.
6) Being all the companies are ISO 9001 company, it is not good for the reputation
company that it is getting complaints about the products related to quality. More
emphasis should be laid on the quality to avert such circumstances.
9) Non monetary incentives should be also given to the retailers in each and every
city. They should be given glow sign boards and other sales promotional materials.
This will boost up their spirits.
10) MRP problem during the days of rising prices should be taken care. In this
situation if retailers are getting the products on a price higher than the MRP they
can’t sell it more than the MRP. So this problem should be looked after carefully.
2) The company should reduce the cost of their products and the margin of the
retailers should be increased.
4) In the same way, whenever any scheme is introduced for the consumer there
should be at least a print advertisement if T.V. advertisement is not possible.
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5) Other incentives should also be given to the retailers like glow sign boards etc.
1) Low margin: - Most of the retailers complained that they get very low margin
in all the products of ABCL as compared to its competitors that’s why unable to
sell the local brand.
2) Leakage problem: -The retailers also complained about the leakage problem
faced by them in the cartoons of Ginni and no replacement, but other companies
are giving them full replacement of leakage packages.
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3) Feed back problem: - The retailers also complained that they get very less
feedback from the company, like whenever any scheme is introduced by the
company, they are not even made aware of the schemes.
4) Quality problem: - The retailers also said that sometimes the quality of soya oil
is low they have face problems regarding their image.
5) MRP Problem: - Retailers also complained that in the days of rising prices,
sometimes it happens that MRP of ginni products is less than the price at which
they have purchased it from the distributor.
Learning
• Convincing capabilities.
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• Knowledge of how an FMCG company works at the ground level.
• Leadership skills.
• How to cover an untapped market where complete reach was not there
previously and then sustaining the sales in the specified territory.
Limitations Of Project
1. Low Print & Media advertisements made us difficult to convince retailer to
buy our product.
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4. Excessive price fluctuation in oil market.
5. Convincing to the retailer in low income residential area was a tough task as
they were very less health conscious.
Recommendations
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1. In every beat A class counter should be pointed out and special benefits or
tie up could be set up.
2. The company should go for regular Print & Television Commercial Ads to
regular reinforce the consumer demand and to gain consumer confidence.
3. The company should try to make stronger Distributor who has a very good
hold in the market and has a strong financial backup.
4. Leakage problem should be taken care of and the retailers should be full
compensated for their loss due to leakage.
6. There should be separate person in the market whose only job must be
merchandising. He must make sure the product is visible in the outlet and
posters and danglers are properly paste and attached at proper place.
7. There must be regular surprise visit of higher officials to check the ground
realities in that market.
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9. Paper work should be reduced and more IT must be used in Sales &
distribution channel.
11. Whenever any consumer oriented scheme is introduced, the scheme should
be directly targeted to that person who actually uses i.e., house wives.
12.Non monetary incentives should be also given to the retailers in each and
every city. They should be given glow sign boards and other sales
promotional materials. This will boost up their spirits.
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Conclusions
Providing food product is a not everyone cup of tea. You can not compromise in it
and if you will try for it you will not be able to sustain in the market for a long
time. FMCG companies have to worry to provide that product which is not only
fulfilling the rules and regulation of government but also satisfy the customer.
Cargill’s products do exactly that and that is why it is chosen by CONSUMER
VOICE. Consumer VOICE- a government funded voluntary organization
that works towards consumer education and awareness, conducted a
laboratory test on seven well-known brands of refined sunflower oil. After
testing them on all possible parameters like colour, adulteration, rancidity and
fatty acid profile, NATUREFRESH Actilite and Gemini, brands from the house
of Cargill, were rated as the best quality and healthiest refined sunflower oils in
the country.
But still it is very tough for NATUREFRESH to become no 1 in very near future
because of the typical mind set of Indian consumer. To achieve this positon
Cargill first wanted to increase its product availability in the market and it did by
the expansion of coverage area. Now company is working on advertisements
which are telecasting in most of serials. Now CARGILL is actually trying to Re
launch NATUREFRESH by the advertisement and change slogan “TASTE ME
YUMMM AUR 5 LITER FAT BHI KUM”.
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Most of the Indian families used oil in their daily food 90% of them use Mustard
oil in curries. But because of change in purchasing power Indian families are also
conscious
About their health and now want to use refined oil also to protect their liver. Most
of the companies are trying to do something new and find that thing which help
customer to be healthy and fit.
It was a very big opportunity for any management student to work in such a big
giant of a very huge industry. The project was excellent and the learning was more
than that. Cargill gave full freedom and ask to perform like a manager. It was great
to get the knowledge how to manage a territory in an industry like FMCG.
Learning was also valuable because meeting and working with such a big people
of industry itself a big experience. The project was basically based on opening of
new outlets but it consist so many things in it which I learnt like how to manage
people? How get maximum output from the people? And how to make a balance in
sales.
Cargill’s business strategy is also very good. Like my project Cargill is also doing
the same project of expansion of new stores in whole north to increase its visibility
Page | 81
and sales. It was good to have your product in most of the because it is known
saying in Hindi “JO DIKHTA HAI WO HI BIKTA HAI”
Annexure1
This is summary of total targeted outlets and target achieved
in West Delhi.
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SrNo. BeatName No.ofOutlets Distribution
1 DwarikaI 38 38
2 DwarikaII 45 44
3 DwarikaIII 32 29
4 Hastsal Road 42 41
5 UttamNagar 45 40
6 Rajapuri 31 20
7 Raj Nagar I 33 29
8 Raj Nagar II 40 40
9 Nagal Rai I 25 22
10 Nagal Rai II 33 32
11 Mahavir Enclave 48 43
12 Sagarpur 1 35 30
13 Sagarpur 2 34 20
14 Delhi Cantt 32 32
15 Palam 63 60
16 VirendraNagar 50 40
17 VikasPuri I 37 15
18 TilakNagar 33 26
19 Hari Nagar 1 54 48
20 JanakPuri 43 35
21 Hari Nagar 2 34 17
22 Krishnapuri 48 30
23 KhyalaI 33 21
24 KhyalaII 37 26
25 Basai Dharapur 56 45
26 RameshNagar I 47 35
27 RameshNagar II 53 31
28 TagoreGarden 37 25
29 AshokNagar 48 39
30 VishnuGarden 46 40
31 MeeraBagh 45 32
32 PeeraGari 24 14
33 Raghuvir Nagar 2 49 42
34 Madhipur I 37 34
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Sr No. Beat Name No. of Outlets Distribution
35 Madhipur II 42 25
36 PaschimVihar I 41 33
37 PaschimVihar II 46 32
38 Vipin Garden 42 38
39 Bhagwati Garden 41 30
40 Pipalwala Rd 35 30
41 Dal Mill rd 31 24
42 OmVihar 43 35
43 Bhudh Bazar 44 37
44 Balaji Chowk 38 36
45 Shri RamRd 41 35
46 Shiv Vihar 45 38
47 Chander Vihar 1 41 39
48 Chander Vihar 2 38 34
49 Vikaspuri 2 38 30
50 Vikaspuri 3 31 27
51 Kakrola Mor 35 32
52 Goyal Dairy 38 34
53 Shahabad 44 41
54 Raj Nagar 44 44
55 Mahaveer Enclave 2 33 30
56 Sitapuri 47 26
57 Chanakya Place 44 22
58 Bindapur 43 22
59 NandgramBhagwati Vihar 48 20
60 Naglai Dairy 55 25
61 Najafgarh I 45 34
62 Najafgarh II 43 36
63 Najafgarh III 41 31
Gemini Exclusive 100
Total 2584 2135
Annexure2
This is the sample Beat list prepared by me
for database collection.
Page | 84
TERRITORY WEST DELHI DAY Thursday
AREA Chander Vihar FREQUENCY WEEKLY
BEAT NAME Chander Vihar 1 COVERED BY Shekhar
S.No. NAME BEAT AREA CONTACT NAME CONTACT NO. AVG BUSINESS (IN LTR)
A-9 Enclave
1 Sharma Store Chander Vihar 1 Chander Manishii 9899848603 36
Vihar
A-26 Near
Bhartindya
2 Garg Store Chander Vihar 1 Rajesh Kumar 65732196 40
Niketan
School
Viddya
Vihar near
Bharti
4 Goyal Store Chander Vihar 1 12
viddya
niketan
School
A-78 Himgiri
5 Durga Store Chander Vihar 1 Virender 995354223 12
enclave
Near Bharti
Shiv Charan Viddya
3 Chander Vihar 1 12
Store Niketan
School
A-78//3
Shobha Gen Santosh
6 Chander Vihar 1 Himgiri 28361017 12
Store Sharma
Enclave
Shop No-18
Vikas
7 Kohali Gen Store Chander Vihar 1 Ashish 9250227777 12
Vihar,Chan
dan Vihar
Main Road
Sachin Trading
8 Chander Vihar 1 Chandar Sachin
Company
Vihar
Main Road
9 Aggraw al Store Chander Vihar 1 Chandar Sattya Prakash 28362470 48
Vihar
A Type of Questions asked to the retailers to get the idea of market
Such questions were very helpful for me and company to know about the different
market and then we used to give a brief presentation on our company and its
brands. It was also necessary to make strategies according to the market to market.
References
• www.cargill.com
• www.cargill.co.in
• www.adaniwilmer.com
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• www.economywatch.com/sector-watch/fmcg-giant.html
• www.business-standard.com/india/...fmcg...in-india/333156/
• http://www.financialexpress.com/news/packaged-edible-oils-to-
capture-50-market/275762/
• fcamin.nic.in
• www.marico.com
• www.atfoods.com
• www.ruchisoya.com
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