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Bombay Pickles Ltd.

Submitted By
Group 3
Suyash Nigotia 13P116
Ashir Madaan 13P131
Kaushik Nihalani 13P148
Mayank Rathore 13P150
Nikhil Jain 13P152


About Bombay Pickles Ltd
Started in 1995 as there was
opportunity for non-homemade pickles
In 16 years, changed ownership from
family partnership to a public limited
company
Sales to all over the state of Maharashtra
Factory and central warehouse at
Aurangabad to take advantage of central
location in Maharashtra
Sales Turnover recorded at 25 crores
Gross Profit Margin of about 15% but
showing decline in the recent quarters




Sales and Distribution
System(1/2)
Company
Manufacturing Plant
Central Warehouse
Distributors
Retailers
Wholesalers
Each of 34 districts
on an average
covered by 3
distributors with 108
distributors in total
Products available at
about 50000
Retailers
Distributors chosen
were from FMCG
trade which already
had established
infrastructure and
facilities
Not a single exclusive
distributor


Sales and Distribution
System(2/2)
Company initially planned to give only 4%
margin to distributors but later agreed on 5%
Distributors are given credit of 15 days
Margin of 12% for Retailers on the MRP
Distributor employed 1-2 salesmen
Retailers covered by salesmen every week or
every 2 weeks depending upon its sales
potential
Some Retailers also covered directly by
distributors



Demands by Distributors
Issue Demand Present Companys View
Replacement
Policy
4% of the sales
value
Upper limit of
50000/- per
annum per
distributor for
damaged
goods
50000/- was fixed to
check the amount of
spoilage and damage
by distributors
Spread
Available
Either increase
margin to 7% or
increase the prices
so that they can
charge more from
retailer
5% of the
sales
FMCG companies are
also giving 5% margin
to distributor.
Increasing MRP just
not possible without
taking hit on market
share
Credit Terms Advance cheques
policy should be
stopped. Sales
officer should
collect cheque on
25
th
day
Cheques are
taken in
advance and
deposited on
15
th
day of
the invoice
Distributors original
businesses are in lean
phase which have
reduced their earnings
Present Situation

TDCPDA(Thane District Consumer Products
Distribution Association) has gone on strike on
their charter of demands
After 10 days, RDCPDA(Raigad District
Consumer Products Distribution Association)
threatened that they would also join them if
demands are not met
Weak sales from last few months due to market
slowdown
Festival season was about to begin where
company can achieve its annual sales target
No further supplies would lead to stockout of their
products in the respective markets
Impact could be on other 95 distributors

Managing Channel Conflict
Detecting Channel Conflict
After the fact approach to the detection of channel
conflict is unsatisfactory
Survey by independent agencies need to be done
to know the perception of other around 95
distributors to uncover potential conflict areas
between channel members before situation reach
in dangerous stage
Appraising the Effect of Conflict
Resolving Conflict
Channel wide committee for periodic evaluations
of emerging problems
Joint goal setting to mitigate the effects of conflict
Distribution executive post need to be created

Reference :Marketing Channels A Management View by Bert Rosenbloom
Recommendations
Distributors Advisory Council or channel Members
Committees for early detection of channel conflict
should be formed
Termination of the distributors cannot be done as it
can backfire : All distributors of Maharashtra region
can go on strike in support
As it is not possible for company to agree on
demands, bringing them on negotiation table is
important now. Demand of Replacement Policy can
be fulfilled
If distributors dont agree for any negotiation, going
for new distributors must be looked upon
Temporarily for these 2 areas company should
approach the distribution system

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