3/19/2012

PROJECT REPORT ON:

TATA RALLIS

Presented By: Anup Kumar, MANAGE Hyderabad

OVERVIEW OF INDIAN PESTICIDE INDUSTRY

India is one of the largest producers of pesticides in Asia. Consumption of Pesticide in India is approx 381g/ha, which is much lower in compare to the world average of 500g/ha. Rice is highest pesticide consuming crop which consumes 25.9% of total consumption. Uttar Pradesh is highest pesticides consuming state in India. There are many large & medium scale enterprises (including about 10 MNC) and more than 500 pesticides formulator spread over the country.

The production of pesticide industry was 6.2 lakh tones during FY 2009-10. Size of Indian pesticide industry was estimated at Rs.106 bn for 2010, including exports of Rs.52.2 bn. PESTICIDES SEGMENTS

Types Of Pesticides Algaecides Bactericides Fungicides Insecticides Miticides Herbicides

Target Pest Group Algae Bacteria Fungi Insects Mites Weeds

Product Name

Company Name

Admiral Liquid, Crystal Plex AG-Streptomycin Curzate, Nustar, Equation, Coragen, Fertera, Avaunt FanFare Round-Up

Sanco Industries Makhteshim Agan DuPont DuPont Makhteshim Agan Monsanto

WORLDS TOP 6 PESTICIDE FIRMS

Monsanto Dow B F AS S NGENTA Y B ER AY DuPont

TATA RALLIS

TATA RALLIS

Gharda Chemicals Limited Indian Major Pesticide Firms

United Phosphorus Limited

P.I Industries Limited

Excel Industries Limited

THE COMPANY
It was set up in 1851 by Stephan Ralli as Ralli Brothers for trading in Jute, Cotton and other agricultural commodities. Rallis India after independence became countrys leading distribution company for Fertilizers, Pesticides & other agri inputs. It is the first Indian company to set up factory for production of technical grade Pesticide. It is the first company to establish R & D facility. It is involved in four segment of agricultural business. They are- Pesticides, Seeds, Fertilizers, and Seed treatment chemicals.

PRODUCT PROFILE Pesticides Fertilizers Seeds Seed Treatment Chemicals Asataf. Applaud, Rogor, Manik, Prabal, Endotaf Aquafert, Calcium Nitrate, Krista, Solubor, Tracel Hybrid Maize, Hybrid Paddy, Bt Cotton Tata Mida, Glazer, Captaf

RALLIS - SPREAD AND DEPTH OF DISTRIBUTION

5 Zonal Offices 3 Regional Offices 33 Area Sales Offices 23 Depots 190 Sales territories 1500 Dealers 30,000 Retailers

RETAIL PROFILING

Cooperatives Consumer buying situations Limited to the members

Wholesale retailer Large/medium/small and medium, during cropping season (region specific)

Retailer Large/medium/small and medium, during cropping season (region specific)

One stop shop Mostly the large farmers (innovators), during cropping season

Type of locality Factors influencing consumers to visit these outlets Customer patronage Details of stocks Service Profitability Cost of stock out for the company Inventory to be maintained Pricing Display space Companies bargaining power Ideal for

Mandal & Dist HQ Credit, discounted price

Villages/manuals/sub urbs Credibility, credit

Villages/mandals/sub urbs Credibility, credit

Mandal & Dist HQ Technical service & convenience

Low Branded Credit and technical service Low Low Low Co-op Comparatively low Low Push

High Branded/unbranded Credit &advice Average Very high Very high W.retailer High High Pull/push

High Branded/unbranded Credit technical service Average Comparatively low Comparatively low Retailer High High Pull/push Branded Technical advice-high Comparatively low Low Low One-stop shop Low Comparatively low Pull

CHANNEL DESIGN

Buyer Needs

CHANN

Product Needs

Retailer Needs

Distribution Needs

Legal Requirements

Feasible Alternative

CHARACTERISTICS OF CHANNEL MEMBER

Buyer Needs: These are the qualities to which buyer gives maximum importance during purchasing of pesticide. This is applicable at the last point where product should be made available. These options are required for satisfying buyer needs. Quality Price

Credit Availability Range Of Products Credibility Service

Product Needs: This is applicable at the stock point near market places. This includes decision regarding stocking point. As the pesticide demand estimation is very important the company should have more number of localized stocking points. Here time utility plays a very important role

Space Location Infrastructure Retailer Needs These are the characteristic, which the channel member should possess.

Product Knowledge Customer Base

No. Of Sales Persons Reputation

Distribution Needs this shows the width of the channel. As the spraying period of pesticide is very short there should be proper distribution of the product when the farmer needs. The sales service is very important. Making The Quality Product Available Sales Service (Complaint Handling, Delivery Time Etc) Generating Demand Legal Requirement-To minimize the burden there should be C&F agent in different states. There Requirement-To should be central service tax and state sales tax to fulfill the legal requirements. Certificate From CST And SST Association Of Memorandum

THE CHANNEL NETWORK

Distribution channel

First leg units)

(from manufacturing

Depots... 1

Depots n

Second leg

Distributor 1

Distributor n

Third leg

Retail 1

Retail n

DISTRIBUTION CHANNEL- From manufacturing units to the retailers

Tata Rallis Products are available in over 30,000 retail outlets across India through its network of 1500 Dealers.

First Leg: From Manufacturing Units to Depots- Tata Rallis send its product to 23 Depots located across major cities of India.

Second Leg: From Depot to Wholesalers: Company has a network of 1500 distributors. The margin offered to the distributors varies for the different product. There is high margin for pesticides, seeds and micro-nutrients and low margin for fertilizers. Volume discounts are given to the distributors. Wholesaler gets incentives for selling extra amount.

Third Leg: This is the flow of goods from wholesaler to retailers, a beat plan is prepared and transportation is done on trucks.

MOTIVATION OF CHANNEL MEMBERS:

Tata Rallis strongly believes in maintaining a good relationship with the channel members so that they are genuinely motivated to work for the company. Also if the channel members are motivated, they can also initiate advertising & sales promotion schemes on behalf of the company. However to keep the channel members motivated to work, the company has to incur certain costs but the benefits of it are felt in the long run. The following are the motivation programs run by the company:

DISTRIBUTORS-

One of the main factors, which keep the distributors motivated, is the margin. Usually the margins offered by the company are HIGH for pesticides and seeds and low for fertilizers. Volume wise this comes out to be a big figure since Tata Rallis product has a good demand in the market. However compared to the other companies the margins are still lower. But the very fact that TATA has a brand name so Tata Rallis products have good demand in the market motivates the distributors to stock it.

The company is giving many kind of sales offers to the Distributors like price discount, Bulk discount and other prizes for achieving high sales.

The company is organizing various Total Quality Management initiatives & workshops. Here various counseling measures are undertaken by the company to improve the overall working of the distribution network.