TRAINING REPORT

AT

ON

Increasing Numeric Distribution of

Cigarettes in Rural Markets

Guided By: Submitted By:

Mr. Lakshay Raizada Kartik Thakur

Himachal Pradesh University

Business School, Summer Hill, Shimla-
171005 (H.P.)
 DECLARATION
Winter Internship is meant to bridge the gap between the real-life business and academic
knowledge. It is a simulation of the business environment and enables to experience the rigors of
Marketing Concept. It provides opportunities to apply the concepts learnt in the class-room to real-
life situations. Being a Management Student, it is necessary to apply all concepts learnt in the
classroom to Practical situations to analyse things in perfect manner. Winter Internship gave me the
opportunity to undergo on field practical training to know the awareness among the people for ITC
LTD. and other Brands offering Cigarettes in Shimla (H.P) in depth.
This training report of the work consists of market study and various aspects related to Sales and
Positioning of the Cigarettes in the market. Full care has been taken to make this report error free
yet the responses collected through respondent cannot be 100% error free and we hope that I shall
be excused for that. Last but not the least I hope this research work will prove to be of some help
and it would applicable to ITC LTD. in formulating an effective and efficient marketing & financial
strategy.

Date:
Signature:

1
 ACKNOWLEDGEMENT
As a part of the ITC Winter Internship, I have prepared this training report to reflect my learning and
experiences. I cannot express enough thanks to Mr. Rakesh Dambi for providing me an opportunity
to undertake winter internship with ITC LTD. I offer my sincere appreciation to Mr. Lakshay Raizada
for helping me throughout the training.
I am not a research expert nor a trend spotter; I am a management student with foundation of
management principles and theories, who is curious about various sectors and its latest happenings.
Definitely, I can’t ignore the technology, with internet as the backbone and those search engines
which helped me in building up this training report. Duration of this training was 9 weeks and 5 days,
it started from 7th January, 2019 to 15th March, 2019.
Finally, I extend my deepest gratitude to Mr. Hamesh (Team Leader), Mr. Deepram Panwer and Mr.
Puran Chand, ITC Salesmen who helped me for conducting the field study. It was a great comfort
and relief to know that Mr. Lakshay Raizada and the ITC Sales team were willing to provide all the
necessary support and information. Yet again I extend our heartfelt thanks.

2
 PREFACE
The training report is prepared under the guidelines of Mr. Lakshay Raizada (ITC Sales Officer,
Shimla). This training report provides a bunch of knowledge about the demand of different
Cigarettes in market as well as it also provides detail knowledge about consumer preference
towards different cigarettes.
There is plenty of data analysis and conclusion given in this training report. On the basis of feedback
through observation method, I have tried to analyse customer perception and the retailer’s outlook
regarding the Cigarettes. Based on my study, I have established close competition among the
companies. As each of the companies are increasing their products, qualities, looks and providing
best services each day.
My analysis is based on sample results. It was challenging as well as learning experience to gather
the information from retailers by meeting them personally in order to get the required information.
There was a lot of time pressure and unwillingness of retailers to respond due to their busy schedule
with dealing customers.

Mr. Lakshay Raizada

ITC Sales Officer
Shimla

3
 Table of Contents

Sr. No. Particulars Page No.

1 Declaration 1
2 Acknowledgement 2
3 Preface 3
4 Executive Summary 5
5 Literature Review 6
6 Objectives of the Study 7
7 Company Profile 8-12
8 ITC FMCG 13
9 Cigarettes and Cigars 14-15
10 SWOT of ITC 16
11 SWOT of ITC’s Cigarettes 17
12 ITC LTD Cigarettes Competition 18
13 Marketing Strategies used by ITC 19-20
14 ITC’s Distribution Channel 21
15 ITC’s Cigarette Segments 22
16 ITC’s Cigarette Types 23
17 TL Working Sheet Format 24
18 ITC’s Schemes for Retailers 25
19 Analysis and Interpretations 26-28
20 Findings and Conclusions 29-31
21 Bibliography and References 32

4
 Executive Summary
The objective of the training is to know the numeric availability of various cigarettes brands offered
by ITC LTD. In rural market, to know whether there is proper scheme communication to the retailers
or not and to study the Market Potential of ITC Cigarettes.
The company ITC has interests in various sectors and they provide consistent quality products to
meet our customer’s requirement worldwide. This report clearly mentions objective of the study
and the research methodology utilized. Research design used in this report is exploratory and the
sources of information are both primary data and secondary data. The data collection method used
is structured non-disguised questionnaire in which the types of questions used are open ended,
multiple choice and close ended. The report contains a detailed view of the tasks, which have been
undertaken to analyse the market of ITC Cigarettes. Some of the researched areas for the purpose
of the study are Mall Road, Lower Bazar, Lakkar Bazar, Masala Mandi, Sanjauli, Dhalli, BCS and New
Shimla, Suni-Tatapani, Theog, Kufri, Mityana, Mashobra. Duration of this training was 9 weeks and
5 days, it started from 7th January, 2019 to 15th March, 2019. This training reveals one of the
important findings like more and more displays of the window hiring and can be given to the retail
outlets as it has been said that “Jitna Dikhega Utna Bikega”.

A detailed survey of the retail outlets was carried to find out their preferences for ITC Celebration
Packs. The details of the methodology are stated below:
Areas of visit: Concentrated Market: SummerHill, Baluganj, Totu, Chakkar, Mall Road, Lakkar Bazar,
Lower Bazar, Masala Mandi, Old Bus stand, Sanjauli, Dhali, Bhatakufar, Malyana. Scattered Market:
Mashobra, Suni-Tatapani, Kufri, Theog, Mityana, Bhrari.

Research design: Exploratory and descriptive.

Sources of information: Primary and Secondary data.
Sampling Method: Simple Random Sampling.

5
 Literature Review
India has over 100 million adult smokers, the second highest number of smokers in the world after
China. The age-standardised prevalence of smoking declined modestly among men aged 15–69
years, but the absolute number of male smokers at these ages grew from 79 million in 1998 to 108
million in 2015. This is due to population growth offsetting modest declines in prevalence. Cigarettes
are displacing bidis, especially among younger men and among illiterate men. This change might
further increase the smoker: non-smoker relative risks of disease. Smoking cessation remains
uncommon—only about 5% of men aged 45–59 years are ex-smokers. India has about 4 current
male smokers for every quitter at these ages. Female smoking at ages 15–69 years has not likely
risen.
Cigarette sales volume will continue to be under pressure in India with government's tough anti-
smoking initiatives and a thriving grey market, as per the latest report by Euromonitor International.
The research agency estimates sales volume declined by 4% last year and poised to decline at a
CAGR of 3% till 2021 whereby the market will fall below 72.6 billion sticks per annum by then from
84.9 billion sticks per annum in 2016.
ITC LTD. has around 79% share of the Indian cigarette market by volume followed by Godfrey Phillips
India at 11% and VST Industries at 8%.
Faced with increasingly onerous regulation on their activities towards the end of the review period,
India’s cigarette brands continued to look for innovative ways to offset the negative influence of tax
increases and other legislative actions designed to suppress demand for their products. VST for
instance sought to circumvent the excise tax hike applied to 64mm cigarettes by introducing its main
brands in 69mm and 84mm variants, while other companies have shifted their focus to other
tobacco categories.
Many consumers prefer low odour cigarettes with unique flavours. Flavoured cigarettes with
capsules have generated interest among consumers as they help them minimise odours after
smoking.
Sales of cigarettes are dominated by the category’s three leading players: ITC Ltd, Godfrey Phillips
India Ltd (GPI) and VST Industries Ltd. The proposed ban on FDI in India’s tobacco industry means
that domestic players such as ITC and GPI are likely to remain dominant, leaving little room for
growth among foreign players such as Japan Tobacco International and Philip Morris.

6
 Objectives of the Study
The objective of the training is to ensure that as a management student I should develop in real life
experience for handling the specific projects and also to develop all understanding of the various
management activities related to the area of our specialization. This training gives a substantial
corporate exposure and also serves as a useful tool of interaction with the corporate sector.
The training has been derived from the field of Marketing and is entitled as “Increasing Numeric
Distribution of Cigarettes in Rural Markets”.

The main objective of the study is:

• Market potential of ITC’s Cigarette in Rural Markets.

• To increase numeric ability of Gold Flake Premium Mint Switch and others brand.
• Proper scheme communication.
• Timely Collection of empty packs from trade.
• To calculate and analyse the Numeric Distribution.
• Estimate market potential for Cigarettes.

7
 Company Profile
ITC is one of India's foremost multi-business enterprises with a market capitalisation of US $ 50
billion and Gross Sales Value of US $ 10 billion. ITC is rated among the World's Best Big Companies,
Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine and as 'India's Most
Admired Company' in a survey conducted by Fortune India magazine and Hay Group. ITC also
features as one of world's largest sustainable value creator in the consumer goods industry in a
study by the Boston Consulting Group. ITC has been listed among India's Most Valuable Companies
by Business Today magazine. The Company is among India's '10 Most Valuable (Company) Brands',
according to a study conducted by Brand Finance and published by the Economic Times. ITC also
ranks among Asia's 50 best performing companies compiled by Business Week.

ITC’s aspiration to create enduring value for the nation and its stakeholders is manifest in its robust
portfolio of traditional and greenfield businesses encompassing Fast Moving Consumer Goods
(FMCG), Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, and Information
Technology. This diversified presence in the businesses of tomorrow is powered by a strategy to
pursue multiple drivers of growth based on its proven competencies, enterprise strengths and
strong synergies between its businesses.
The competitiveness of ITC’s diverse businesses rest on the strong foundations of institutional
strengths derived from its deep consumer insights, cutting-edge Research & Development,
differentiated product development capacity, brand-building capability, world-class manufacturing
infrastructure, extensive rural linkages, efficient trade marketing and distribution network and
dedicated human resources. ITC’s ability to leverage internal synergies residing across its diverse
businesses lends a unique source of competitive advantage to its products and services.

8
Within a relatively short span of time, ITC has established vital brands like Aashirvaad, Sunfeast,
Fabelle, Sunbean, Dark Fantasy, Mom's Magic Bingo!, Yippee!, Candyman, mint-o, Kitchens of India,
Farmland, B Natural, ITC MasterChef in the Branded Foods space; Essenza Di Wills, Fiama, Vivel,
Engage, Savlon, Charmis, Shower to Shower and Superia in the Personal Care products segment;
Classmate and Paperkraft in Education & Stationery products; Wills Lifestyle and John Players in the
Lifestyle Apparel business; Mangaldeep in Agarbattis and Aim in the Safety Matches segment. This
growth has been rated by a Nielsen Report to be the fastest among the consumer goods companies
operating in India.
Today, ITC is India's leading Fast-Moving Consumer Goods company, the clear market leader in the
Indian Paperboard and Packaging industry, a globally acknowledged pioneer in farmer
empowerment through its wide-reaching Agri Business and a trailblazer in green hoteliering. ITC
Infotech, a wholly-owned subsidiary, is one of India's fast-growing IT companies in the mid-tier
segment. This portfolio of rapidly growing businesses considerably enhances ITC's capacity to
generate growing value for the Indian economy.

ITC's Agri-Business is one of India's largest exporters of agricultural products. The ITC Group’s
contribution to foreign exchange earnings over the last ten years amounted to nearly US$ 6.8 billion,
of which agri exports constituted 57%. The Company's 'e-Choupal' initiative has enabled Indian
agriculture significantly enhance its competitiveness by empowering Indian farmers through the
power of the Internet. This transformational strategy has already become the subject matter of a
case study at Harvard Business School apart from receiving widespread global acclaim.
As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly
nation-oriented. Chairman Y.C Deveshwar calls this source of inspiration "a commitment beyond
the market". In his own words: "ITC believes that its aspiration to create enduring value for the
nation provides the motive force to sustain growing shareholder value. ITC practices this philosophy
by not only driving each of its businesses towards international competitiveness but by also
consciously contributing to enhancing the competitiveness of the larger value chain of which it is a
part." ITC group directly employs more than 32,000 people and the Company's Businesses and
value-chains generate around 6 million sustainable livelihoods many of whom live at the margin in
rural India.
ITC's production facilities and hotels have won numerous national and international awards for
quality, productivity, safety and environment management systems. ITC was the first company in
India to voluntarily seek a corporate governance rating.
The Company continuously endeavours to enhance its wealth generating capabilities in a globalising
environment to consistently reward more than 8,37,000 shareholders, fulfil the aspirations of its
stakeholders and meet societal expectations.

9
 Vision Statement of ITC
Sustain ITC's position as one of India's most valuable corporations through world class performance,
creating growing value for the Indian economy and the Company's stakeholders.

Mission Statement of ITC

To enhance the wealth generating capability of the enterprise in a globalising environment,
delivering superior and sustainable stakeholder value.

Tagline of ITC
Tagline- “Enduring Value”.

10
 Core Values
ITC's Core Values are aimed at developing a customer-focused, high-performance organisation
which creates value for all its stakeholders:
Trusteeship
As professional managers, we are conscious that ITC has been given to us in "trust" by all our
stakeholders. We will actualise stakeholder value and interest on a long-term sustainable basis.
Customer Focus

We are always customer focused and will deliver what the customer needs in terms of value, quality
and satisfaction.

Respect for People

We are result oriented, setting high performance standards for ourselves as individuals and teams.
We will simultaneously respect and value people and uphold humanness and human dignity.
We acknowledge that every individual brings different perspectives and capabilities to the team and
that a strong team is founded on a variety of perspectives.
We want individuals to dream, value differences, create and experiment in pursuit of opportunities
and achieve leadership through teamwork.
Excellence

We do what is right, do it well and win. We will strive for excellence in whatever we do.
Innovation
We will constantly pursue newer and better processes, products, services and management
practices.
Nation Orientation
We are aware of our responsibility to generate economic value for the Nation. In pursuit of our
goals, we will make no compromise in complying with applicable laws and regulations at all levels.

11
 FMCG and Cigarettes

ITC ITC Hotels

Business
Portfolio Agri Business

Paperboard Packaging

12
 ITC FMCG
It is ITC's strategic intent to secure long-term growth by synergising and blending the diverse pool
of competencies residing in its various businesses to exploit emerging opportunities in the FMCG
sector.
The Company's institutional strengths - deep understanding of the Indian consumer, strong
trademarks, deep and wide distribution network, agri-sourcing skills, packaging know-how and
cuisine expertise - continue to be effectively leveraged to rapidly grow the new FMCG businesses.
ITC has rapidly scaled up presence in its newer FMCG businesses comprising Branded Packaged
Foods, Lifestyle Retailing, Education and Stationery products, Personal Care products, Safety
Matches and Incense Sticks (Agarbatti), at an impressive pace over the last several years, crossing
₹10,500 crore mark in 2016-17.

ITC LTD. FMCG Segments:

• Cigarettes and Cigar

• Foods
• Personal Care
• Education and Stationary
• Lifestyle Retailing
• Safety Matches
• Agarbattis

13
 CIGARETTES AND CIGARS
ITC is the market leader in cigarettes in India. With its wide range of invaluable brands, ITC has a
leadership position in every segment of the market. ITC's cigarette business stands testimony to the
company's unwavering and unrivalled commitment to quality, innovation and consumer focus.
With more than one hundred years of expertise in developing products to match the evolving taste
of the consumers, ITC's cigarette business continues to be relentless in its pursuit of strengthening
its leadership position in every segment of the market in India. ITC's wide range of brands, includes
Insignia, India Kings, Classic, Gold Flake, American Club, Navy Cut, Players, Scissors, Capstan,
Berkeley, Bristol, Flake, Silk Cut, Duke & Royal.

The Company has been able to consolidate its leadership position with single minded focus on
continuous value creation for consumers through significant investments in creating & bringing to
market innovative product designs, maintaining consistent & superior quality, state-of-the-art
manufacturing technology, & superior marketing and distribution. With consumers & consumer
insights driving strategy, ITC has been able to fortify market standing in the long-term, by developing
& delivering contemporary offers relevant to the changing attitudes & aspirations of the constantly
evolving consumer.

14
ITC's cigarettes are manufactured in state-of-the-art factories at Bengaluru, Munger, Saharanpur,
Kolkata and Pune, with cutting-edge technology & excellent work practices benchmarked to the
best globally. An efficient supply chain & distribution network reaches India's popular brands across
the length & breadth of the country.

In overseas markets, ITC's cigarette business continues to maintain high standards of international
quality and competitiveness. West Asia is a key export region for ITC and we offer a wide portfolio
of high-quality cigarettes in this region. With a Portfolio of brands under the Classic, Wills and
Scissors Umbrella, ITC has cemented its international standing being the 3rd largest player in the
countries of Bahrain & Qatar. ITC was also the first company to introduce a flavour on demand
(capsule) product in the economy industry segment in West Asia region.
ITC Ltd sells 81% of the cigarettes BIDI in Asia, where 275 million people use tobacco products and
the total cigarette market is worth close to $11 billion (around Rs. 757399.4 million).

15
 SWOT of ITC
Strengths

• ITC has a strong and experienced management.

• Strong brand presence, excellent products advertising.
• Diversified product and services portfolio which includes FMCG, Hotel chains, paper &
packaging and agri-business.
• Over 6500 E-Choupal CSR activities and sustainability initiatives enhance ITC’s brand image
reaching over 4 million farmers.
• ITC limited employees over 25,000 people.
• Excellent research and development facilities.
Weaknesses

• ITC is still dependant on its tobacco revenues and people have cheaper substitutes and other
brands.
• Hotel industry has not been able to create a huge market share.
Opportunities

• Tap rural markets and increase penetration in urban areas.

• Mergers and acquisitions to strengthen the brand.
• Increasing purchasing power of people thereby increasing demand.
• More publicity of hotel chains to increase market share.
Threats

• Strict govt regulations and policies regarding cigarettes.

• Intense and increasing competition amongst other FMCG companies and hotel chains.
• FDI in retail thereby allowing international brands.

16
 SWOT of ITC’s CIGARETTES
Strength

• Biggest and the largest player in the Indian tobacco market with a market share of 80%.
• Its Gold Flake tobacco brand is the largest FMCG brand in India - and this single brand alone
holds 70% of the tobacco market.
• Excellent research and development facilities.
Weakness

• It still has to consolidate its foot in the cigar market largely dominated by Godfrey Philips.
Opportunities

• ITC is moving into new and emerging markets like developing countries of Eastern Europe,
Africa etc.
Threats

• The obvious threat is from competition, both domestic and international.

• ITC's opportunities are likely to be opportunities for other companies as well.
• Strict Government regulations and policies regarding cigarettes.

17
ITC Limited Cigarettes Competition

Godfrey Philips India Ltd.

VST Industries

NTC Industries

Golden Tobacco

18
 Marketing Strategy Used by ITC
ITC started an earnest exercise by creating a new brand image and corporate philosophy by investing
in new business categories like personal care, premium apparel, rural business (e- Choupal) and
foods. All along using its famed distribution strengths built through its successful past businesses
like cigarettes, paperboards and packaging, hotels and agri business, to create synergies across its
verticals and help prop up its new businesses, like personal care and foods.

ITC has a well-thought-out strategic approach. Rather than acquiring weaker brands to get into
these new segments inorganically, it created a range of new personal care and branded apparel
brands. The first step in this well-planned strategy was the launch of Wills Lifestyle, the premium
branded apparel business in 2002.
ITC then moved on to take the competition head on in the FMCG domain, through ITC Foods in
August 2001, and personal care business, which is the focal point of this story, in 2005. It has created
good impact with its well etched-out Personal Care Brands. Under this category, brands like Essenza
Di Wills, Fiama Di Wills, Vivel Di Wills, Vivel and the Superia were designed to take care of various
sets of consumer segments. But behind this launch was five years of intensive on ground research
of market conditions and consumer expectations. Over one lakh consumers were surveyed across
the country to test various prototypes. Acceptance benchmark was kept as high as 90 percent for
the final products.
ITC called this exercise as '3E’ approach —explore, establish and execute. As an adage goes 'if you
have to win a race, you have to clearly target the No 1', ITC too aimed the No 1 which happened to
be the formidable HUL (which still reigns over 50 percent of the FMCG market). And ITC's target was
HUL and P&G only. ITC roped in its tobacco business veteran Sandeep Kaul to spearhead the
personal care launch; it also sought help from product formulation and branding experts in Europe
and America to formulate the fragrance, aesthetics and packaging. Many of the brands have also
been developed at its R&D centre.
When it comes to FMCG ITC believes in 3 things- Availability, Feasibility and Freshness. ITC will
never compromise on these parameters. The results are there for everyone to see. In less than four
years, ITC has been able to create brand awareness and consumer acceptance for its five product
lines Essenza Di Wills, Fiama Di Wills, Vivel Di Wills, Vivel and the Superia—each targeted at the
needs, aspirations and usage behaviour of different consumer segments. Kaul informs that the
strategy for designing personal care is that everyone is a potential consumer.

Competitive advantage in the Marketing strategy of ITC

1. Big conglomerate
Over the years ITC has become a large conglomerate offering the diverse range of products and
services ranging from Agri-Products to food products in FMCG Segment to IT Solutions. Experience
in such a diverse array of products and services has helped the company to emerge as a prominent
player in the market especially in FMCG- Cigarettes, Hotels and Paperboards & Packaging sectors.

19
2. Vast experience
With 108 years of experience in Indian, Market ITC has developed a robust distribution framework
which is parallel to none of its competitors present. This has helped the company to understand the
need and wants of the consumers making it financially strong and competitively ahead of its peers.
3. The X-Factor
ITC’s E-Chaupal initiative aimed at making internet available to Indian farmers has touched the lives
of millions of farmers and their families in the rural part of the country thus increasing brand
presence through this social initiative and in turn leveraging some Brand essence points to the firm.

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 ITC’s Distribution Channel

• Company Hub Factory

• Carried and Forward Agent

• Wholesaler and Dealer

Small Wholesale Dealer
• Retailer

• Consumer

The company operates with its own sales channel, products are made available to the wholesale
dealers through Carried & Forward Agents (CFA’s) which is then forwarded to the Retailers in towns
directly or through Small Wholesale Dealers to reach the consumers in the remotest of locations of
the country.

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 ITC’s Cigarette Segments

Competitor's
Type Full Form Length ITC's Products
Products
India King, B&H, Classics, G.F King (Red
KSFT King Size Filter Tip 84mm Marlboro
& Blue)
Longs - 74mm Navy Cut Longs
F.S Premier
Regular Size Filter G.F Premium/Mint Switch, Navy Cut 68/Crush
RSFT 69mm
Tip RSFT 85/Clove
Crush 89
F.S Premier
Deluxe Size Filter
DSFT 64mm G.F Superstar/Capsule, Flake Liberty 49/Crush
Tip
Mini 49

Top Selling Cigarettes of ITC:

Sr.
Type Competitor’s Product Segment
No.
1 G.F Superstar Four Square Premier DSFT
2 G.F Superstar Capsule (Blue) Four Square Crush Mini DSFT
3 G.F Premium Four Square Premier RSFT
4 G.F Premium Mint Switch Four Square Crush RSFT
5 G.F King Size - KSFT
6 Classics Marlboro KSFT

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 ITC’s Cigarette Types

Sr. MRP PTR Outer CFC

Type Outer
No (₹) (₹) Price (₹) (1M=1000)
1 Flake Liberty (10HL) 40 36 .2&.5 720/1800 12M
2 G.F Superstar (5HL) 25 21.5 0.2 430 4M
3 G.F Superstar 49 43 0.5 2150 12M
4 G.F Superstar Capsule (Blue) 49 43 0.5 2150 12M
5 G.F Premium 95 86.5 0.5 4325 12M
6 G.F Premium Mint Switch 95 86.5 0.5 4325 12M
7 Navy Cut RSFT (10HL) 60 54.5 0.5 2725 12M
8 Navy Cut Longs (10HL) 100 90.9 0.2 1818 10M
9 G.F King (Red) (10HL) 150 137.5 0.2 2750 10M
10 G.F King (Red) (20HL) 300 275 0.2 5500 10M
11 G.F King Light (Blue) (10HL) 150 137.5 0.2 2750 10M
12 G.F King Light (Blue) (20HL) 300 275 0.2 5500 10M
13 Classic Rich Taste (10HL) 150 137.5 0.2 2750 10M
14 Classic Rich Taste (20HL) 300 275 0.2 5500 10M
15 Classic Balanced Taste (10HL) 150 137.5 0.2 2750 10M
16 Classic Balanced Taste (20HL) 300 275 0.2 5500 10M
17 Classic Refined Taste (10HL) 150 137.5 0.2 2750 10M
18 Classic Refined Taste (20HL) 300 275 0.2 5500 10M
19 Classic Refreshing Taste (Menthol) (20HL) 300 275 0.2 5500 5M
20 Classic Ice Burst (10HL) 150 137.5 0.2 2750 5M
21 Classic Ice Burst (20HL) 300 275 0.2 5500 5M
22 Classic Double Burst (20HL) 300 275 0.2 5500 5M
23 Classic Low Smell (10HL) 150 137.5 0.2 2750 5M
24 Classic Low Smell (20HL) 300 275 0.2 5500 5M
25 B&H (20HL) 278 253 0.2 5060 5M
26 India King (20HL) 360 328 0.2 6560 5M

23
 TL Working Sheet Format
,

TTL O/L on
Date: WD Name: Beat: DS Beat
GFPM/FS GFCap/R
S.No Retailer Name Address Beat Vol Class GFK CRT/MAG CBT CUM/ML CDB/MFB CIB GFP/FSP 68 Crush Nv Long NCR GFS/FSP 49 WM FL/CRG Scheme

10

11

12

13

14

15

16

17

18

19

20

Competition Inputs/Feed back: Empty Packet Scheme by Four Square- (1) Crush Long=₹8 per ITC Inputs /Feed back : Premium Mint(RSFT)= ₹10 Per Empty Pack. Capsule
pack and ₹500 per M. (2) Mini Crush= 5+1 Scheme and ₹3 per Empty Pack. (3) Premium (₹49) DSFT= ₹5 per Empty Pack.
=₹3 Per Empty Pack. (4) MFB= ₹19 Per Pack + ₹1 DS.

During training above format was used to collect data from the retailers. Data collection includes
ITC’s and competitor’s product availability in the market. It also includes scheme communication
column.

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 ITC’s Schemes for Retailers

ITC Schemes Competitor’s Schemes

• G.F Premium Mint RSFT = ₹10 per • F.S Crush = ₹8 per Empty Pack and
Empty Pack and ₹2 for DS. ₹500 per M (unit of
• G.F Superstar Capsule DSFT= ₹5 measurement).
per Empty Pack. • F.S Crush Mini= 5+1 Scheme and
₹3 per Empty Pack.
• F.S Premier DSFT = ₹3 per Empty
Pack.
• Marlboro Fusion Beyond = ₹19 per
Empty Pack + ₹1 for DS.

As we can see from above table, ITC scheme offering for retailers is quite less as compared to
competition Godfrey Philips. This can be because competition product doesn’t sell more that is why
they offer more schemes to the retailers so that sales can be increased.
As a part of training scheme communication was the objective of the training. Total outlet covered
during training was 482. Scheme was communicated to all the retailers. Hence objective was
completed.

25
 Analysis
and
Interpretation

26
What is Numeric Distribution?
Numerical Distribution is the unilateral distribution showing the total retail stores occupying the
company’s products. It is essential the quantitative assessment of the distribution. If you have 10
stores in the locality, a company selling its products through 3 of those stores would have 30%
numeric distribution.

Top selling cigarettes brands numeric distribution with respect to competitors:

Numeric Distribution = Total Outlets Where Product is Placed

Total Number of Outlets
Total Number of Outlet Covered = 482

Calculation of Numeric Distribution:

Gold Flake Superstar DSFT Four Square Premier DSFT

= 474/482*100 =374/482*100

= 98.3% =77.59%

Gold Flake Superstar Capsule DSFT Four Square Premier Crush Mini DSFT

= 362/482*100 =95/482*100

= 75.10% =19.70%

Gold Flake Premium RSFT Four Square Premier RSFT

= 446/482*100 =312/482*100

= 92.53% =64.73%

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Gold Flake Premium Mint Switch RSFT Four Square Premier Crush RSFT

= 275/482*100 =223/482*100

= 57.05% =46.26%

Navy Cut RSFT -

= 224/482*100 -

= 46.47% -

Gold Flake King Size KSFT -

=412/482*100 -

=85.47% -

Classic Rich Taste KSFT Marlboro Advance KSFT

=316/482*100 =94/482*100

=65.56% =19.50%

Classic Balanced Taste KSFT -

=264/482*100 -

=54.77% -

Classic Refined Taste KSFT Marlboro Lights KSFT

=242/482*100 =108/482*100

=50.02% =22.40%

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 Findings and Conclusion
We can draw following conclusions from study:

• From the depicted information collected we can say that the market penetration of the ITC
cigarettes is quite good in the market and the ITC Cigarettes have better co-ordination and
more focused promotion mix on the part of the sales and marketing team.

• ITC is market leader in cigarettes, this gives ITC immense advantage. There is very high
demand of Gold Flake Superstar DSFT, it is the most selling cigarette of ITC.

• ITC should focus on its KSFT segment, its numeric availability is less as compared to other
segments. Marlboro is worlds biggest brand in cigarette industry, currently its operating
through Godfrey Philips.

• I got to know some retailers were complaining that the ITC products do not reach in time
and there is a demand of ITC products.

• As a part of the training I discovered certain problems faced by the salesmen which included
problems like unavailability of the pamphlets and the late arrival of the stocks to the
salesperson, resulting into lost opportunities and reduced sales.

• During the survey we saw tremendous competition in the cigarette segment especially in
schemes provided by competition. Godfrey Philips provide multiple schemes mostly on
every product as compared to ITC.

• Finally, to conclude ITC is doing pretty well in cigarette industry. It has become top brand in
cigarette. It should focus on sustaining its position and explore cigar segment.

• Along with this, the company must invest in the training of the sales team for improving their
presentation skills and thereby help them to generate better sales.

Freshness
As a part of training, I have to check for the freshness of the products. I checked and recorded the
manufacturing date of ITC’s and competitor’s product.
Products Evaluated:

• G.F Superstar Capsule DSFT / F.S Crush Mini DSFT

• G.F Premium Mint Switch RSFT / F.S Crush RSFT

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Manufacturing dates were checked in first week of February. In case of DSFT segments stock had
December dates (24/12/18 and 17/12/18), stock was more than one month old. In case of RSFT
segment stock also had December dates (18/12/18 and 05/12/18), stock was more than one month
old.

To Conclude,

• G.F Superstar Capsule DSFT: 37 days old stock (more than 1 month) approx.
• F.S Crush Mini DSFT: 42 days old stock (nearly 1.5 months) approx.

• G.F Premium Mint Switch RSFT: 43 days old stock (nearly 1.5 months) approx.
• F.S Crush RSFT: 51 days old stock (nearly 2 months) approx.

Feedback from Retailer

As a part of training, I was interacting with retailers and supposed to record their response. Each
retailer has its own unique problem but many problems were common in every retailer and those
are listed below:

• Loose: Many small retailers face this problem. As a small retailer sometimes, they cannot
afford full packet of most selling cigarettes (which is of 50 packs of cigarette).

• Supply Issue: This is also most common issue faced by many retailers. They all addressed
that supply is inconsistent and supply person doesn’t behave properly. Also supply person
didn’t communicate schemes properly.

• Rates Issues: Some retailers complained about the rates. Few wholesalers were purchasing
cigarettes from Parwanoo and Chandigarh (bills were not provided), they were selling at the
same rates as of distributor and sometimes even at better rates which was surprising. It
affects the sale.

Challenges in Rural Markets

• Placement of KSFT Segment: During placement of KSFT segment few problems was faced by
sales-team, problems are as follows:
▪ Rates of KSFT Segment is high and sale is less in rural markets, this demotivates
retailers because their investment gets blocked.
▪ In continuation of above point buying capacity of rural retailers is also less, so
retailers have to face financial challenge also.
▪ There is no consistent sale of these brands, sometimes it leads to overstocking and
sometimes out of stock. Sale of these brands based upon tourists, especially in
markets like Kufri and tourist movement is inconsistent.

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• Weather Conditions: Due to continuous and unpredictable weather conditions such as
snowfall and rainfall, roads get blocked for some period of time. It leads to pending supplies
to different markets which eventually affects sales also. This is one of the major reasons for
inconsistent supply.

• Movement of Locale People and Trade: During winters season, most of the trade and locale
people moves out of the city, due to the movement of people sales are affected negatively.

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 Bibliography and References

• Research Methodology – C.R Kothari

• www.itcportal.com
• www.marketing91.com
• ITC Annual Report 2018
• www.mbaskool.com
• www.marketingteacher.com
• economictimes.indiatimes.com
• Market Research Forum India
• Wikihow.com
• icrcommercialreport.com

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