itc summer internship

Impact of Private Hawkers on Retail Market

INTERNSHIP PROJECT REPORT ON

IMPACT OF PRIVATE HAWKERS ON RETAIL MARKET

SUBMITTED TO

A.GOVINDRAJ,Asst Manager

ITC LIMITED

SUBMITTED BY:

NARENDRA KULKARNI

Student-PGPB02

VANGUARD BUSINESS SCHOOL, BANGALORE



CONTENTS Page No

1) Executive Summary 4

2) Introduction 5

3) Methodologies

6

4) Qualitative Data Collection 7

5) Interpretation of Problems 8

6) Insights of Data Collected WD Wise 9

7) Graphical Representation 10

Ganesh Associates 10

Savitha Sales Corporation 11

8) Implemented Solutions to reduce Private Hawkers Area-wise 13

9) Converted Outlets and Converted Private Hawker 14

10) Solutions to overcome the Impact 15

11) Conclusion 16

12) List of Converted Outlets 17

13) Appendices 20



ACKNOWLEDGEMENT

With great pleasure I, extend my gratitude towards Mr. A Govindraj,Asst Manager at ITC

Marketing limited, Bangalore and Mr. Gaurav Sharma,Area.Manager and Mr.Santosh Gobre,AE

for their constant advice and interest and valuable guidance during the course of the project and

internship stint. The cooperation extended to me was not only useful for the internship stint but

also will be helpful for my future to come. I also would like to thank my beloved mentors Mr.

Arka Bhattacharya and Mr.Rahul Reddy for their constant guidance throughout the Internship

process.

Finally I would like to thank both the wholesale distributors i.e.”Savitha Sales Corporation” and

“Ganesh Associates”,Mysore and their support staff, Salesmen for providing a lot of support and

insights about the market. Finally I would also like to thank all of them who helped me

constantly in the project stint directly and indirectly.



EXECUTIVE SUMMARY

The project was basically carried out in order to overcome the impact of private salesmen on the

retail market. The project went out by finding the un-serviced outlets across the city of Mysore

on the basis of the ITC formed routes for the registered salesmen through the distributor points.

During the process of internship I, was able to interact with 2300 retail outlets and found out 200

un-serviced outlets in the respective areas of Mysore city and also we were able to convert 6

private salesmen thus constituting a add on 240 outlets in list of WD’s. Finally the project went

on in order to understand the problem associated in doing business with the DS (Direct

Salesmen) by the un-serviced outlets and also tried to address the problem and convert

them .With the better understanding of the problem associated with the un-serviced retailers, I

have come up with few suggestions which would be of an advice to the distributor points in

order to improve the sales of the Direct Salesmen and also to convert the private hawkers to

Direct Salesmen which would be further useful in acquiring more number of stores in days to

come in future.



INTRODUCTION

The Project was carried out in order to overcome the impact of private salesmen in the retail

market. Here the project was based on the issue that the percentage of market capture was

basically done by the private hawkers, these are the salesmen who are selling all products of

varied companies and thus they do a certain percentage of sales of cigarettes in market. As the

main agenda of the project was to look for the un-serviced outlets in the areas of Mysore city and

basically understand the problems associated with them not doing the business with the DS and

also to address their problems and covert them to do business with DS. Further in course of the

work the another main agenda was to meet the private hawkers and convert them to join as a DS

at distributor points which would increase the number of outlets counts for the DS and the WD’s.

During the course of the work few insights were found out were-in basically the outlets which

were left as un-serviced or serviced by the private hawkers, were the ones which were having the

problems of credit issue as the DS cannot issue a credit of more than half a day which made to

lose out on the business with the respective stores. Another issue which took of the light was the

availability of wholesale stores nearby and thus making the retailers of that region to buy

whenever there is a customer in place, as these are the outlets which do business after the sales

takes place. Based on the data gathered in the market as a part of the course work we converted

95 stores of the total 200 un-serviced outlets present in the respective areas of respective DS and

also we converted 6 private hawkers considering a coverage of 40 outlets per hawker a total of

240 outlets were added-on to the WD’s. Few suggestions which quoted below which would be a

key element to convert the stores and private salesmen in the future.



METHODOLOGIES

Process of Converting the Outlets

• Divided the 200 un-serviced outlets on the basis of problems they faced to do business

with DS

• We assured few outlets to provide a stock on a regular basis for the whole year as some

outlets had a problem with the earlier DS of the respective area

• Converted few outlets by assuring them the benefits like display, PSU etc

• Created awareness about the selling of old MRP in the areas of D-Plain and thus

converted outlets with the respective area

• Converted few outlets by increasing the time frame of collection by the DS,As these

outlets had a problem with credit

• Used the technique of availability of all products and at the same price throughout the

year helped to convert few of the outlets in the C-class category stores

Process of Converting the Private Hawkers

• Majorly private hawkers service the outskirts of the city where there is majority of C-

class category outlets available and thus the quantity of cigarettes purchasing power is

low

• Converted the private salesmen by providing assurance of allocating a route which can do

a business of Rs 60,000

• Assured a private salesmen of providing salary for a few months until he settles down in

the business

• As there will be a fluctuation of price in the wholesale market, therefore we converted a

private salesmen based on availability of products throughout the year at same price



QUALITATIVE DATA COLLECTION

Basically the data was collected by meeting and having a discussion with more than 200 Un-

serviced outlets across Mysore city and outskirts of it. Here the problem associated with the un-

serviced retailers where noted down and there were reasons which were repeatedly occurring

from the retailers and the reasons are given below,

1) Problem associated with credit

2) Problem associated with only selling of ITC products as retailers also requires Non-ITC

products

3) Good relationship existing between private hawkers and un-serviced retailers

4) Availability of wholesale stores nearby also impacting the DS to do business within the

respective area because the retailers buy at least three times a day depending upon the

sales occur in their respective outlets

Taking percentage into consideration for the above mentioned reasons based on 200 un-

serviced outlets sample

1) Credit-41% (82 outlets)

2) Provision of all products(ITC and Non-ITC)-10.5% (21 outlets)

3) Availability of Wholesale stores in respective areas-24.5% (49 outlets)

4) Good Relationship-24% (48 stores)



INTREPRETATION OF PROBLEMS

Here the major problem of not doing business with the DS is because of non-provision of

credit which accounts for 41.5% in nature and this is due to the fact that these are the

outlets which do a business of Rs 400 a day and basically carry out the process of buying

on the amount of sales a respective outlet does the respective day.

As quoted above the second major constituent is the provision of all products (ITC and

Non-ITC) which accounts for 10.5% of the total un-serviced outlets. Here basically these

are the percentage of stores which are able to do a business with one hawker because as

these retailers require a time frame to collect the money and invest the money back into

the business. Therefore these retailers prefer to do business with a hawker who can

majorly provide all the required products at one stretch.

Here another problem which the DS is facing is the percentage of wholesale stores

available in the respective area which accounts about 24.5% of the complete market.

Here were-in the retail outlets bring the products depending on the sales they incur for

and also the wholesalers present in the region provide a time frame in order to re-collect

the amount for the products they distributed. Thus making the business harder for the DS

in respective area.

As quoted above in the page no-6 the relationship plays a prominent role in the business

module for the un-serviced outlets which majorly accounts for about 24% of the un-

serviced outlets, were-in these outlets are doing a business around several years and

created a chain and thus it is hard to divide the business between the DS and the

respective hawker and thus it is hard to capture the respective market.



INSIGHTS OF DATA COLLECTED WD WISE

As per the data collected the 200 un-serviced outlets is divided into 140 outlets which comes

under “Savitha Sales Corporation” and 60 outlets under “Ganesh Associates” based on the data

the total number of outlets is divided on the basis of service provided by the private hawkers and

the wholesalers. The data is interpreted below.

Savitha WD

1) Service provided by Private Hawker

Total Stores Serviced By

Private Hawker

53

Total Un-serviced outlets

found 140

% of service by

PH 38%

2) Service provided by Wholesalers

Total Stores Serviced by Wholesale 8

7

Total Un-serviced Outlets found

14

0

% of service by

wholesale

62

%



Ganesh WD

3) Service Provided by Private Hawker

Total Stores Serviced By

Private Hawker

9

Total Un-serviced outlets

found 60

% of service

by Private

Hawker 15%

4) Service Provided by Wholesalers

Total Stores Serviced by Wholesale 51

Total Un-serviced Outlets found 60

% of service by

wholesale

85

%

On the basis of the above data collected and interpreted the service provided by the private

hawkers in the region of “Ganesh Associates” turns out to be 38% of the un-serviced outlets and



15% un-serviced outlets is been serviced by the private hawkers in the region of “Savitha Sales

Corporation”.

Here basically the total percentage of private hawkers and wholesalers combined under both the

WD’s constitute 8.85% of the total 2300 outlets serviced by both the WD’s. Here there are few

outlets which constitutes to a problem of not conducting a proper business with the DS thus these

outlets are being serviced by the private hawkers and wholesalers for the respective outlets

GRAPHICAL REPRESENTATION OF MAJORITY UN-SERVICED OUTLETS

CONSTITUED AREAWISE

1) GANESH WD

Total Un-serviced Outlets-60

VVET- 6 Outlets

Gayatripuram-5 Outlets

Jayanagar-6 Outlets

Ashok Road -7 Outlets

Saraswathipuram-6 Outlets

Srirampura-21 Outlets

Nazarbad-3 Outlets

Santipet-6 Outlets

Fig-(A)


6 5

6

7621

3 6VVETGayatripuramJayanagarAshok RoadSaraswathipuramSrirampurNazarbadSantipet


2) SAVITHA WD

Total Un-serviced Outlets -140

Bannimantap-6

Padavarhalli,Vijaynagar-13

Rajivnagar P and T Quarters-10

Mandi Mall-7

Kare-16

Basavangudi,Hebbal,BMC-19

Bogadi,KHB Colony-20

NR Mall-15

Udaygiri-31

613

10

7

16

1920

15

31

BannimantapPadvarhalliRajivnagarMandi MallKareBasavangudiBogadiNR MallUdaygiri



Fig-(B)

From the graphical representation the areas of Udaygiri and Srirampura constitutes major

number of un-serviced outlets and followed by areas are Bogadi, and Basavangudi were-in the

supply is basically done by the private hawkers.

Taking into consideration of 200 un-serviced outlets and average business of Rs 400 a day of

sales by each store the total sales and earning comes to be Rs 80000 per day which points out the

loss of business the DS is making every day and considering the commission of all DS taken

together it comes out to be Rs 640 per day. Thus considering average breakup for 26 DS in both

the WD taken together into consideration it comes out to a loss in business of RS 24 and a

monthly loss of business in Rs 738.

IMPLEMENTED SOLUTIONS TO REDUCE PRIVATE HAWKERS AREAWISE

As per the graphical representation mentioned in page no-10, it indicates that the highest

number of un-serviced outlets is present in the area of Srirampura, Bogadi, Basavangudi,

Udaygiri.

Considering the area of Srirampura here the major number of outlets are being serviced

by the private hawkers and therefore with the help of ITC team members and support of

WD we were able to convert the hawkers by allocating them the respective area and the

outlets

The region of Bogadi and Basavangudi were majorly the un-serviced outlets do the

business with the private hawkers and therefore with the support of the Savitha WD we

were able to convert the private hawkers by assuring them of providing a business of Rs

60,000 a day along with the area they are previously servicing and thus helping them in

order to match their previous income.

A total of six private hawkers were converted across the Mysore city and thus

constituting a total conversion of 240 un-serviced outlets which were previously serviced

by them



CONVERTED OUTLETS AND CONVERTED PRIVATE SALESMEN

During the course of the internship process a total of 200 un-serviced outlets were found in the

areas of Mysore district and the private hawkers were also found out during the process of

conducting the project. As of the process completed we were able to convert 95 stores in the area

of “Savitha Sales Corporation” and “Ganesh Associates” taking 200 un-serviced outlets into

consideration in order to make the outlets serviceable by the distributor salesmen.

As per the above data the percentage of outlets converted in the Savitha Sales Corporation area

can be interpreted as 46.42% (Taking 140 Un-serviced outlets of the area into account)

The percentage of Un-serviced outlets converted in the region of “Ganesh Associates” can be

interpreted as 50 %( Taking 60 un-serviced outlets into account)

The total percentage of outlets converted is considered to be 47.5%

With the support and guidance of ITC team and WD six private hawkers are converted into

Regular DS by offering them the area which can give sales of Rs 60,000 per day and thus

considering 40 stores as an average of each of six hawkers, We were also able to convert 240

stores on a stretch and the hawkers name are listed below,

Name Area

Mr.Veelu

Bannimapnt

ap

Veerbhadregow

da Bogadi

Gangaraj Utgahalli

Nagaraj Hinkal Korghalli



Converted Private Salesman in “Ganesh Associates”

Name Area

Nagaraj

Parsynhund

i

Shivlingaswam

y Srirampura

SOLUTIONS TO OVERCOME THE IMPACT OF PRIVATE HAWKERS AND UN-

SERVICED OUTLETS

Some of the solutions or strategies quoted below are based on the problems which are addressed

as shown above in the page no-4, Here basically in order to overcome or reduce the impact of

private hawkers on retail market and reduce the un-serviced outlets, few suggestions can be

framed they are quoted below,

The attraction of the un-serviced retail outlets is basically dependent on the benefits they

incur from the organization or the distributor points; therefore in order to acquire the un-

serviced outlets the organization can provide display, PSU (Product Stacking Unit),

Cycling Display etc.

In order to convert the private hawkers to join as a DS, The distributor and organization

should provide the hawkers to do a business of at least Rs 50000 to 60000 and also need

to provide a benefit like salary etc until the hawker settles down in the area provided.

As the credit plays a prominent role in C-class category of outlets basically the average

business will be around Rs 400 therefore considering the number of such outlets in the

respective area the hawker should increase the collection time frame which opens the

door to business with such outlets to an extent

As the private hawkers provide all products inclusive of ITC and Non-ITC, In order to

address the problem the only key is to convert them by stating availability of ITC

products throughout the year and therefore each and every outlet having the above



mentioned problem can be converted at least to the maximum extent because as the

private hawkers will face the problem at times to meet the requirement of those Outlets.

In order to address the problem associated with relationship existing between the private

hawkers and the un-serviced outlets, it can be done by having a fruitful conversation in

with the un-serviced outlets to differentiate the cigarette business to the DS and the other

Non-ITC product business with the private hawker. The conversation can end up by

providing certain benefits in order to convert them.

CONCLUSION

As per the analysis and findings carried out throughout the project the majority of

the un-serviced outlets are the ones who are doing the business in a low quantity

and therefore they face the problem with cash and carry system of the DS.

As per the graph’s mentioned above in page no-10 and 11 indicates that the

diversification of un-serviced outlets are majorly available in the areas of

Udaygiri and Bogadi, Here Udaygiri basically consists of large number of

wholesale outlets which provides a time frame for the collection from the un-

serviced outlets, The area of Bogadi lies in the outskirts of the city thus the

number of private hawkers are considered to be higher and in order to control the

number of private hawkers, We converted the private hawkers serving the

respective market

The percentage of un-serviced outlets under both the WD’s constitutes for 8.85%

and we were able to reduce to the percentage to about 4.42% during the process of

the internship by converting the un-serviced outlets and the respective private

hawkers of the region

In order to further make large number of outlets serviceable the WD’s needs to

come up with certain schemes which would be beneficial to the outlets and also

could start up a business with the DS of the respective areas.



CONVERTED OUTLETS AREAWISE

SL No Converted Outlets Private Hawker/WS Area DS

1 Lokesh Tea Stall Wholesale Padvarhalli Fayaz2 Manjunath Store Wholesale Padvarhalli Fayaz3 Kumar Tea Stall Wholesale Padvarhalli Fayaz4 Lingaraj Tea Stall Wholesale Padvarhalli Fayaz5 Coffee Bar Private Hawker Padvarhalli Fayaz6 Arun Tea Shop PH(Veelu) Bannimantap Nazir7 Kkiran Tea Stall PH(Veelu) Bannimantap Nazir8 Siddique Tea Stall PH(Veelu) Bannimantap Nazir9 Sri Gajanna Tea Stall PH(Veelu) Bannimantap Nazir

10 K P Store Wholesale N R Mall Athique11 Sayad Bakery Wholesale N R Mall Athique12 Fayaz Tea Stall Wholesale N R Mall Athique13 Lakshmi Pan Shop Wholesale N R Mall Athique14 Bahavani Store Wholesale Rajivnagar Mumtaz15 Tammana Store Wholesale Rajivnagar Mumtaz16 Bireshwara Store Wholesale Rajivnagar Mumtaz17 Lokesh Tea Stall Wholesale Padvarhalli Fayaz18 Chandramma Pan Shop Wholesale Padvarhalli Fayaz

19 Coffee BarVeerbhadregowda(PH) Padvarhalli Fayaz

20 Chaluvarayswamy Stoe Lokesh(PH) Padvarhalli Fayaz21 Shivanna Store Lokesh(PH) Padvarhalli Fayaz22 Vijay Kumar Tea Stall Lokesh(PH) Padvarhalli Fayaz



23 Mahendra Pan Shop Lokesh(PH) Padvarhalli Fayaz24 Narayan Pan Shop Lokesh(PH) Padvarhalli Fayaz25 Nandini Milk Parlour Wholesale Padvarhalli Fayaz26 Naganna Pan Shop Wholesale Padvarhalli Fayaz27 Krishna Pan Shop Wholesale Koorghalli Saleem28 Ramesh Pan Shop Nagaraj Hinkal(PH) Koorghalli Saleem29 Rchandra Store Nagaraj Hinkal(PH) Koorghalli Saleem30 Lakshmi Bangal Store Nagaraj Hinkal(PH) Koorghalli Saleem31 Tea Shop Masood((PH) Udaygiri Shekar32 Tea Shop Masood((PH) Udaygiri Shekar33 Ya alla Tea Stall Wholesale Udaygiri Shekar34 AMK Tea Stall Wholesale Udaygiri Shekar35 ARN Tea Stall Wholesale Udaygiri Shekar36 Tea Shop Wholesale Udaygiri Shekar

37 Sri Gajanna Tea StallVeerbhadregowda(PH)

Bogadi,Uttagalli Manjunath

38 Sri Gargeshwara BakeryVeerbhadregowda(PH)


39 Vinayaka StoreVeerbhadregowda(PH)


40 Bhagyalakshmi StoreVeerbhadregowda(PH)


41 Chamundeshwari StoresVeerbhadregowda(PH)


42 Tea Stall Nagaraj Hinkal(PH)Bogadi,Uttagalli Manjunath

43 Priyadarshini Pan ShopVeerbhadregowda(PH)


44 Hassan Iyengar's BakeryVeerbhadregowda(PH)


45 Grape CornerVeerbhadregowda(PH)


46 Lakshmi Stores WholesaleBogadi,Uttagalli Manjunath

47 Lakshmi Departmental StoreVeerbhadregowda(PH)


48 Lakshmi Provision Store Gangaraj(PH)Bogadi,Uttagalli Manjunath

49 Manjunath Store Masood((PH) Udaygiri Shekar50 ARN Cool Parlour Masood((PH) Udaygiri Shekar51 Chowdeshwari Tea Stall Wholesale Udaygiri Shekar52 Bismilla Tea Stall Wholesale Udaygiri Shekar53 A N Tea Stall Wholesale Udaygiri Shekar54 Ya Allah Tea Stall Wholesale Udaygiri Shekar



55 Sanid Provision Store Wholesale Udaygiri Shekar56 Parshan Store Masood((PH) Udaygiri Shekar57 Jyothi Store Wholesale Udaygiri Shekar58 Friends Cool Corner Wholesale Udaygiri Shekar59 Mysore Tea Stall Wholesale Udaygiri Shekar60 Chamundeshwari Store Wholesale Basavangudi Shaukat61 Amal Provision Store Wholesale Basavangudi Shaukat62 Lakshmidevi Store Wholesale Basavangudi Shaukat63 Dhanlakshmi Store Wholesale Basavangudi Shaukat64 Ramdev Tea Stall Wholesale Basavangudi Shaukat65 Chamundeshwari Tea Stall Wholesale Basavangudi Shaukat66 Raja Ram Tea Stall Wholesaler VVET Lingaraj67 Sri Chamundeshwari Store Wholesaler VVET Lingaraj68 Bhavani Tea Stall Wholesaler VVET Lingaraj69 Chaitra Cool Wholesaler VVET Lingaraj70 Sri Santosh Tea Stall Wholesaler Kuvempunagar R Kumar71 Kanamma Nilaya Shop Wholesaler Kuvempunagar R Kumar72 Mahalakshmi Tea Stall Private Hawker Kuvempunagar R Kumar73 Friends Tea Stall Wholesaler Kuvempunagar R Kumar74 Divya Store Wholesaler Kuvempunagar R Kumar75 Chandru Pan Shop Wholesaler Kuvempunagar R Kumar76 Laxmamma Bangle Shop Private Hawker Kuvempunagar R Kumar77 Nandana Store Wholesaler Kuvempunagar R Kumar78 Abhiman Tea Stall Wholesaler Kuvempunagar R Kumar79 Rajappa Pan Shop Wholesaler Kuvempunagar R Kumar80 Devaya Hundi Store Wholesaler Kuvempunagar R Kumar81 Ganesh Provision Store Wholesaler Kuvempunagar R Kumar82 Aishwarya Provision Store Wholesaler Kuvempunagar R Kumar

83 Aishwarya Sores Nagaraj(PH)

Parsyn Hundi,Srirampur Nagaraj

84 Sri Mahadeshwara StoreShivlingaswami(PH)


85 Nandini Tea Stall Wholesaler


86 Chamundeshwari Store Wholesaler


87 Mataji Tea Stall Wholesaler SarawatipuramRamaswamy

88 Srinivasa Store Wholesaler SarawatipuramRamaswamy



89 Manju Entreprises Wholesaler SarawatipuramRamaswamy

90 Yuvkar Sangh pan Shop Ravi(PH) SarawatipuramRamaswamy

91 Siri Nandini Ravi(PH) SarawatipuramRamaswamy

92 Ashwini Bar Ravi(PH) SarawatipuramRamaswamy

93 Modern Cafetaria Wholesale Ashok Road Gajanana94 Deepa Darshini Wholesale Ashok Road Gajanana95 KK Bar and Restaurant Pan Shop Wholesale Ashok Road Gajanana

Blue Color indicates converted Private Salesmen

APPENDICES

Total number of Stores Visited -2300

Total Un-serviced Outlets found-200

Sample Considered-200

Savitha Sales Corporation-140

Ganesh Associates-60


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