Pidilite Industry

Distribution Network, Product category @ Pidilite

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Work on

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INTRODUCTION:-




Pidilite Industries Limited is the largest adhesive manufacturer in India. It also has world
wide presence in adhesives, art material, construction chemicals and other industrial
chemicals. Pidilite's most famous product is the Fevicol range of adhesives. Its other famous
brands are " Fevikwik", Dr. Fixit, Cyclo, Ranipal,Hobby Ideas, M-seal and Acron.

The Fevicol brand, Pidilite's most recognized adhesive brand Pidilite's corporate office is
located in Andheri (East), Mumbai. The company has manufacturing facilities at various
locations in India, including Mahad (Maharastra), Vapi (Gujarat) Baddi (Himachal Pradesh)
and Kala Amb (Himachal Pradesh). It also makes Fevi KwikIndia's first ever One Drop
Instant Adhesive. This brand is the most popular Instant Adhesive In South Asian countries.

Pidilite Industries is the market leader in adhesives and sealants, construction chemicals,
hobby colours and polymer emulsions in India. Our brand name Fevicol has become
synonymous with adhesives to millions in India and is ranked amongst the most trusted
brands in India.

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Pidilite is also growing it's International presence through acquisitions and setting up
manufacturing facilities and sales offices in important regions around the world. Fevicol is
now the largest selling adhesives brand in Asia.
We have reached where we are today mainly due to the close team-work of our employees
and due to our shared value system which emphasizes commitment to excellence, closeness
to customers, and the spirit of innovation.

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Pidilite

Since its inception in 1959, Pidilite Industries Limited has been a pioneer in consumer and
specialities chemicals in India. Over two-third of the company’s sales come from products
and segments it has pioneered in India.
Their product range includes Adhesives and Sealants, Construction and Paint Chemicals,
Automotive Chemicals, Art Materials, Industrial Adhesives, Industrial and Textile Resins and
Organic Pigments and Preparations. Most of the products have been developed through
strong in-house R&D.
The Group's turnover is about 3614 Crores for the year 2012-13 to the 2013-2014 current
year figures.
Pidilite Industries is the market leader in adhesives and sealants, construction chemicals,
hobby colours and polymer emulsions in India. Their brand name Fevicol has become
synonymous with adhesives to millions in India and is ranked amongst the most trusted
brands in India.
Pidilite is also growing it's International presence through acquisitions and setting up
manufacturing facilities and sales offices in important regions around the world. Fevicol is
now the largest selling adhesives brand in Asia.
They have reached where they are today mainly due to the close team-work of their
employees and due to our shared value system which emphasizes commitment to excellence,
closeness to customers, and the spirit of innovation.

Fevicol is back with its new campaign, which retains the norm of simplicity accompanied
with cuteness and humour of the earlier ads.

The Brief:
Fevicol ads have always been worth remembering in a cute way. Right from Bollywood ‘bad

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man’ Bob Christo wrestling with a chair made of Fevicol, to a politician who is glued to his
chair, to the hen that laid unbreakable eggs, to the overflowing bus, and the joint family that
refuses to fall apart. The new campaign continues along the same lines.

The Execution:
The campaign has been conceptualised by Ogilvy & Mather, as in the case of the previous
campaigns for Fevicol. Anil Jayaraj, Chief Marketing Officer, Pidilite Industries, explained,
“Fevicol, which is synonymous with adhesives, has always had very memorable and
entertaining communication. Be it a politician glued to his chair, the hen that laid unbreakable
eggs, to the overflowing bus, or the ‘Moochwali’ advertisement – all the commercials have
been loved and appreciated by consumers. They often wait for the next Fevicol commercial
with great expectations, and with this new ad, we are taking this legacy forward. This one is
again a clutter breaking and very enjoyable commercial that will bring a smile to viewers’
face. The background score is catchy and the film will make people connect with the brand.
O&M has come out trumps again and has delivered yet another entertaining commercial.”

The Final Product:
The film opens on hilly road with a newly-wed couple travelling in the jeep, when a cyclist
following the jeep starts ringing the cycle bell. This irritates the husband, who tries his best to
shake off the cyclist. But to no avail, as the cyclist doggedly follows the jeep, ringing the bell.
The ad ends with the shot of the back of the jeep loaded with cans of Fevicol, thus revealing
the reason how the cyclist could keep up with following the jeep.

Xpert Comment:
Rahul Jauhari, who is taking over as NCD of Everest Brand Solutions next month, put forth
his views on the campaign and said, “I quite liked it. Infact, enjoyed watching it a lot. One
little moment between the recently married couple. The story is so simple. And the
storytelling so apt. Thumbs up to the Fevicol team.”

Our Take:
The campaign looks appealing just like earlier Fevicol campaigns. It is lighthearted and fun
to watch and doesn’t deviate from the brand salience.

Client: Pidilite

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Brand: Fevicol
Agency: Ogilvy & Mather
Medium: Television
Creative: Piyush Pandey, Abhijit Avasthi
Director: Prasoon Pandey (Corcoise Films)
Servicing: Vivek Verma, Ramanathan Sridhar
Films: Porus Khareghat
Music Composer: Ehsaan Noorani
Singer: Divya Kumar
Lyrics: Piyush Pandey



Pidilite Industries is an Indian company that enjoys noteworthy success in craftsmen products
and industrial speciality chemicals. The company’s most successful brand Fevicol and its
sub-brands such as Fevikwik, Fevibond, Fevigum, Fevistick and Fevicryl have consistently
commanded over 70% of the total market share. In 2005, Fevicol stood 24th among top 150
Indian brands. The company has also been able to stay head of its competitors in the
organized and un-organised sector. The case discusses innovative marketing strategies
adopted by Pidilite to enable an industrial product like Fevicol carve out its niche as a
consumer brand. It also discusses the future outlook of the company to retain its dominating
position in the Indian market in light of increasing competition from multinationals and the
unorganised sector.

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DISTRIBUTION STRUCTURE OF PIDILITE INDUSTRIES








FORMAL -----------------
INFORMAL --- - ---- - ----

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Process


The goods are first manufactured in the company owned manufacturing units situated at
Vapi , Bhiwandi and Malhaar. Here the goods are posted in the challan under Pidilite
Industries Ltd. Then the goods are sent to the various mother godowns spread across the
country for further distribution. Once the goods reach the mother godowns, they are
transferred under the name of the marketing concern of Pidilite Industries Ltd. ( PIL) called
Parek Marketing Ltd.(PML). This is done for some financial implication which have two fold
benefits. They not only account for certain percentage of tax saving but also enable the
company to show double th profits. Of course, the PML rates are higher than those of PIL
due to central sales tax and other taxes levy on the goods during transport to godowns.

This is sent to the C & F agents and the Company owned Depots. From here the goods are
invoiced under PML and sent to the WSS who inturn bill the goods under the name of their
respective concerns and sell the goods to the retailers. The retailers also sell the goods to the
end consumers under their dealership.

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MANUFACTURING UNIT
MOTHER GODOWN
C & F
CO.
DEPOT
WSS
RETAILER
PRIMARY SALES
SECONDARY SALES

CHALLAN UNDER PIL
TRANSFER OF
OWNERSHIP FROM
PIL TO PML
CHALLAN UNDER PML

INVOICE UNDER PML
BILLING IN THE
BOOKS OF WSS
BILLING IN THE
BOOKS OF RETAILER

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TRANSPORTATION SYSTEM






THE TRANSPORTATION SYSTEM


The transportation system from the factory to the respective distribution stages are covered
solely by road. FACTORY (MAHARASTRA)
MOTHER GODOWN
TRUCKS
KANPUR(COMPANY
DEPOT)
GHAZIABAD(C&F AGENT)
TRUCKSTRUCKS
WSS(42)
WSS(46)
TRUCKS
TRUCKS
RETAILER RETAILER RETAILER RETAILER RETAILER
3 WHEELERS/VANS

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 From the factory, the goods are transferred to the mother godowns in respective zones
via trucks.
 From the mother godown ( in Delhi ) , trucks are used to transfer the goods to
company depots and C&F agents.
 From the company depot or C& F agents , the goods are sent via trucks to different
WSS in their assigned regions.
 From the WSS , the goods are sent to wholesalers or retail outlets, via three wheelers
or vans.
 Sometimes the goods are sent to their company depots and C&F agents directly from
the manufacturing unit, instead of going via . company godown depending on route
compatibility.



DESCRIPTION OF CHANNEL PARTNERS

I. C&F Agent


These agents have infrastructural and transportational facilities and are the responsible for the
transfer of goods.No sale takes place at this level.These C&F agents get monthly
emolumentsn from the company for their service.

II. WSS

The company appoints various wholese stockist who are a very important link between the
C&f Agents and the retailers. The number of these stockist is not fixed and varies according to
the sales potential and geographic size of the region.

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Primary sale takes place at the Wholesale stockist. Hence their selection, motivation and
evaluation becomes very important to the company.

TYPES OF WSS

The company has divided the WSS on the basis of their sales value and sales potential.The
various categories of WSS are


1. CLASS A : These stockists are the ones who have a sales potential above
Rs 10,00000 Per month.

2. CLASS B: These stockist have the sales potential between Rs 5,00000 and
Rs10,00000 Per month.

3 . CLASS C: These stockist have a sales potential of less than Rs

III. RETAILER


The WSS sell the goods to the retailers who in turn sell it to the end consumers. The retailers
are classified in terms of their dales potential in the following manner:-

Class A- Greater than Rs 3,000,00 pm
Class B- Between Rs 3,000,00-1,000,00 pm
Class C –Less than 1,000,00 pm

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Why distribution channel is important ?

Without distribution even the best product or service fails. According to Jean-Jacques Lambin
a marketer has two roles: (1) to organise exchange through distribution and (2) to organise
communication.
Physical distribution, or Place is most important 'P's in the marketing mix.
What pidilite do to its position as a leading brand in India? The answer: strong brands, wide
distribution network and excellent reputation amongst those who use its products. As one
investment analyst put it, "Fevicol is so synonymous with the quality and the product that most
of the direct consumers or carpenters cannot take risk with this kind of product. This gives
Pidilite serious pricing power."
Decisions about physical distribution are key strategic decisions. They are not short term.
Increasingly it involves strategic alliances and partnerships which are founded on trust and
mutual benefits. We are seeing the birth of strategic distribution alliances. You can see
Southwestern Bell in the Hall Of Fame explain how marketing marriages provide new ways of
getting products and services in front of customers.
Channels change throughout a product's life cycle. Changing lifestyles, aspirations and
expectations along with the IT explosion offer new opportunities of using distribution to create
a competitive edge.
Controlling the flow of products and services from producer to customer requires careful
consideration. It can determine success or failure in the market place. The choice of channel
includes choosing among and between distributors, agents, retailers, franchisees, direct
marketing and a sales force.
They has entered new markets such as South Asia, Africa and Europe with products such as
adhesives, art materials and industrial chemicals. They have decided to tap the overseas
markets more aggressively and expect to double their export revenues within the next two
years.'' Currently, Pidilite has export revenues of Rs 350 mn. management style.

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DISTRIBUTION IS IMPORTANT BECAUSE:

 Firstly, it affects sales - if it's not available it can't be sold. Most customers won't wait.
 Secondly, distribution affects profits and competitiveness since it can contribute up to
50 percent of the final selling price of some goods. This affects cost competitiveness as
well as profits since margins are squeezed by distribution costs.
 Thirdly, delivery is seen as part of the product influencing customer satisfaction.
Distribution and its associated customer service play a big part in relationship
marketing.

Distribution Strategy :
Distribution strategy is influenced by the market structure, the firm's objectives, its resources
and of course its overall marketing strategy. All these factors are addressed in the section on
selecting Distribution Channels.
 The first strategic decision is whether the distribution is to be: Intensive (with mass
distribution into all outlets as in the case of confectionery); Selective (with carefully
chosen distributors e.g. speciality goods such as car repair kits); or Exclusive (with
distribution restricted to upmarket outlets, as in the case of Gucci clothes).
 The next strategic decision clarifies the number of levels within a channel such as
agents, distributors, wholesalers, retailers. In some Japanese markets there are many,
many intermediaries involved.
 Next comes a sensitive strategic decision whether to go single channel or multi-channel.
Some product of pidilite, use multi-channels - they use many different routes, direct
and indirect, to bring their products to their customers. Multi-channel Systems like this
are common where intensive distribution is required. So direct marketing is combined
with indirect marketing through intermediaries.
 Then comes the next level of strategic decisions concerning strategic relationships and
partnerships. Two common strategies are Vertical Marketing Systems and Horizontal
Marketing Systems.

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o Vertical Marketing Systems involve suppliers and intermediaries working closely
together instead of against each other. They plan production and delivery schedules,
quality levels,promotions and sometimes prices. Resources, like information,
equipment and expertise, are shared. The system is usually managed by a dominant
member, or 'channel captain'. VMS is more flexible than vertical integration where the
manufacturer actually owns the distribution channel.
o Horizontal Marketing Systems occur where organisations operating on the same
channel level (e.g. two suppliers or two retailers) co-operate. They then share their
distribution expertise and distribution channels. This can speed up the time taken to
penetrate the market. There is room for creative alliances here.
Pidilite's biggest advantage is that his products meet his customers' expectations. They have 30
years of established presence in the business. Over 60% of their sales come from products and
segments they have pioneered in India. They have built a strong image of durability and quality
for our products. A strong brand equity, ability to meet consumers' needs by a process of direct
and close contact and continuous feedback from users and a wide distribution coverage are
their key strengths.
Pidilite wants products that have brand potential but whose owners lack distribution
capabilities. The brand should either have a leadership position or be in a position to become a
leader. So far, the acquisitions have been in related segments, and paid for in cash. Pidilite is
also increasing his existing distribution network in smaller towns, not just to push the acquired
brands, but also because they expects the furniture market there to mushroom as the benefits
of economic growth percolate downwards, and this will drive Fevicol's sales.

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Selecting members within a channel :
Having decided to go through intermediaries the next question is whether to use agents or
distributors and also how many. Unlike distributors, agents don't hold stocks - they only act as
sales agents finding customers, collecting orders and passing them on to the supplier in return
for a percentage commission.
Pidilite's distribution network with 30,000 dealers/distributors and 300,000 retail outlets spread
throughout India is better than many FMCG companies. Pidilite interacts with his dealers
regularly. they still continue to allocate a major portion of their spends on ground activities
such as dealer meets and the rest is for advertising.

How would you select a distributor or an agent? Here are some criteria:
1. Market Coverage, 2. Sales Forecast, 3. Cost, 4. Other Resources, 5. Profitability, 6. Control,
7. Motivation, 8. Reputation, 9. Competition, 10. Contracts
1. Market Coverage: - does the profile of existing customers match your target market profile?
- is the number of customers big enough to meet the required distribution penetration? - is the
existing sales force big enough to cover the territory? - are they dependant on a single
individual? - are the existing delivery fleet and warehouse facilities adequate?
2. Sales Forecast: How many can they sell? What are their forecasts based upon? Do they give
a 'best, worst and average' forecast? Will they invest in large stock commitment? Do they have
budgets to run promotions? Some suppliers even ask their distributors for a marketing plan
showing how they intend to market the supplier's products.
3. Cost: What will it cost in terms of discounts, commissions, stock investment and marketing
support?
4. Other Resources: Does the target market require anything special such as technical advice,
installation, quick deliveries, instant availability? If so can the distributor provide it?
5. Profitability: How much profit will the distributor generate for the supplier?
6. Control: Do they have a reporting system in place? How do they deal with problems? How
often are review meetings scheduled? Can you influence the way they present your products?

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7. Motivation: Does the agent or distributor convey a sense of excitement and enthusiasm about
the product? What about its sales force - what's their reaction?
8. Reputation: Has it got a good track record? This includes the number of years in business,
growth and profit record, solvency, general stability and overall reliability. Is it dependant on
one key player?
9. Competition: Do they distribute any competitor's products?
10. Contracts: Some distributors demand exclusivity. Some agreements tie the supplier in for
certain periods of time. Check for flexibility in case things go wrong.
The bottom line is: Can the agent or distributor be motivated, controlled and trusted? Motivated
to sell your product among a range of others. Controlled to feed back results or change strategy
if requested. And trusted to act as a reliable ambassador of your product?

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Sales Force Management at Pidilite
In pidilite the sales force management is the important role and it plays a wide role in the
Furniture industry. The sales force management is successful if implemented and directed
well.

Types of Sales Representatives


In Pidilite they design a sales force step wise and it is the main role of the pidilite that it
is the most important factors to study the steps of sales force which is included in
Pidilite.

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Typical Training topic of Pidilite




Sources of Information When evaluating the sales force at Pidilite

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BUILDING LEADERS FOR TOMORROW
Young Talent Management or (YTM) is a flagship program of Pidilite. The program draws
students from the fields of business, technology and research to work on high-impact projects
involving strategy and cutting -edge technology. So, whether you’re looking for an internship
or post graduate opportunities to progress your professional career we at Pidilite, provide a
platform to expand professional and academic horizon. This helps the young talented
individuals to prepare for a successful career ahead.
Find a role that you are passionate about and can be rewarding as you work with the brands
and people that drive our business growth.
MANAGEMENT TRAINEE PROGRAM
Management Trainee program is focussed on building the career of trainees through a robust
program run over duration of 3 years where a trainee goes through multiple functional and
cross-functional stints. We visit select MBA and Engineering Institutes across India to hire
Management Trainees for this programme.
We are proud of our ability to nurture individuals and provide them the space and
empowerment they need to hone their talents. Our size gives us the unique ability to provide
fast growth and high responsibility early in one's career as well as multiple avenues to reach
the top.
INTERNSHIPS AT PIDILITE INDUSTRIES LTD
We offer the most challenging 2 month summer internship to students. We also offer winter
internship projects to students. Live projects related to sales, market development supply
chain etc are given where students stand to gain hands-on experience of working in one of the
world’s leading consumer goods company. Once the students are a part of it, they work
towards creating better future every day.
OPTIONS OF INTERNSHIP:
Sales
Finance
Marketing
Research and Development

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SALES PROMOTION

Profit Management Promotions is a Sales Promotion, Liquidation and Consulting firm
comprised of experienced professionals offering customized services to meet the needs of
independent furniture retailers. Profit Management Promotions specializes in high-impact
sales promotions designed to raise money for furniture retailers or liquidate stores that have
decided to close.
Marketing furniture to the public can be a challenging venture for a small business owner.
Furniture pieces are items that consumers purchase only on occasion. Most furniture items have
a higher price point than other retail goods and convincing the consumer to make an investment
is crucial to an effective advertising campaign. There are several furniture promotion ideas that
can be used to help you reach your target market.

Salespeople are an effective link between the company and its customers to produce customer
value and company profit by:
• Representing the company to customers
• Representing customers to the company
• Working closely with marketing

Setting sales promotion objectives includes using:
• Consumer promotions
• Trade promotions
• Sales force promotions

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Major Sales Promotion Tools



Samples offer a trial amount of a product
Coupons are certificates that give buyers a saving when they purchase specified products
Cash refunds are similar to coupons except that the price reduction occurs after the purchase
Price packs offer consumers savings off the regular price of a product
Samples offer a trial amount of a product
Coupons are certificates that give buyers a saving when they purchase specified products
Cash refunds are similar to coupons except that the price reduction occurs after the purchase
Price packs offer consumers savings off the regular price of a product
• Contests, sweepstakes, and games give consumers the chance to win something—such
as cash, trips, or goods—by luck or through extra effort
• Contests require an entry by a consumer
• Sweepstakes require consumers to submit their names for a drawing
Samples Coupons Cash refunds Price packs
Premiums
Advertising
specialties
Patronage
rewards
Point-of-
purchase
displays
Demonstrations Contests Sweepstakes Games

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• Games present consumers with something that may or may not help them win a prize
• Event Marketing

Major Sales Promotion Tools
Trade Promotion Tools


Conventions and trade shows are effective to reach many customers not reached with the
regular sales force
Sales contests are effective in motivating salespeople or dealers to increase performance over
a given period

• Size of the incentive
• Conditions for participation
• Promote and distribute the program
• Length of the program
• Evaluation of the program
DiscountAllowance
Free goods
Specialty
advertising

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Conclusion

From the above we can conclude how pidilite uses it sales force management by including all
steps and getting well implemented. The distribution channel of Pidilite industry is well
developed and serving the market at its best.

As pidilite industry is leader in its segment and performing well in the market and we can also
conclude that it is providing innovative and extra feature products with an aesthetic look
packaging and advertising.