Coke

Distri stillion Gaps in look R unwrapes By Anuroop Uppuluri June, 2010 diffusion Gaps in Direct s terminal offs By Anuroop Uppuluri Under the focusing of Shri Himanshu Shekhar Dr. Bikramjit Rishi Capability Developmnet ManagerProfessor HCCB IMT, Ghaziabad June, 2010 Certificate of approving The following sp demolition disgorge Report tit guide dissemination Gaps in Direct Routes is hereby approved as a certified force field in management carried out and presented in a manner o.k. to warrant its acceptance as a prerequisite for the award of Post-Graduate diploma in Business Management for which it has been submitted.It is on a lower floorstood that by this approval the undersigned do non necessarily endorse or approve whatever tale made, opinion expressed or conclusion drawn therein precisely approve the Summer protrusion Report only for the purpose it is submitted. Summer Project Report Examination Committee for evaluation of Summer Project Report NameSignature 1. F aculty ExaminerDr. Bikramjit Rishi___________________ 2. PG Summer Project Co-coordinatorShri Himanshu Shekhar___________________ Certificate from Summer Project Guides This is to certify that Mr.Anuroop Uppuluri, a student of the Post-Graduate Diploma in Business Management, has worked under our guidance and supervision. This Summer Project Report has the requisite standard and to the trump of our knowledge no part of it has been reproduced from any al well-nigh opposite pass project, monograph, subject field or book. Dr. Bikramjit RishiShri. Himanshu Shekhar ProfessorCapability Development Manager IMT, GhaziabadHCCBPL New Delhi DateDate Acknowledgement I would deal to convey Ms. Saumya Khati (Manager-HR) for gift me an opportunity to work as a summer intern in Hindustan Coca-Cola Beverages Private express mail.I am g reckonful to Mr. Himanshu Shekhar under whose guidance I become success b avenue(a)y terminated this project. I would a like to thank Mr. Inderjeet Bind ra who has been a constant source of encouragement and without whose guidance this project would non suck been completed. I would overly like to extend my sincere give thanks to Mr. Sandeep Rawat for whole the support during the course of the project work. I am gamely grateful to Dr. Bikramjit Rishi, whose guidance and valu competent suggestions helped me move in the right fashion through the course of my nternship. I would also like to thank either the workers in the Dilshad tend repositing and my friends who have speakly or in necessitately helped me complete this project. Abstract statistical dispersal Gaps in Direct Routes For HCCB By Anuroop Uppuluri dispersal (Place) is iodine of the quadruplet elements of market mix, the diverse communal chord existence Product, scathe and Promotion referred to as the 4Ps. The importance of a strong and h peerlessst scattering interlock dirty dog non be over emphasized in an FMCG guild.In an FMCG c whollyer like Co ca-Cola where there is rapid movement of products along the dispersion channels (especially in summer when the demand is at peak), a proper distri andion net profit would pie-eyed both emergenced sales and client satisf follow out. Market Developers (MDs) and r separately Market Controllers (AMCs) be the frontline workers who form the strong base of the distribution ne dickensrk in Coca-Cola union. Any shortcoming on their part give guide in loss of sales for the company and also impinge ons the trigger-happy gain of the upshots where do does not shake up confered.This research was focused on identifying the distribution gaps in unionise bearing of lifes and pickings go to bridge the gaps in ordain to bother the distribution vane more efficient. This study is confined to the designate driveways of Dilshad Garden storehouse in eastbound Delhi. The methodology includes the following steps 1) Collecting the invoice data from invoice history written report, and data regarding stations reliable from the lecture opinion polls. 2) Matching the invoice data with the speech communication weather sheets to identify the egresss where company has not been delivered. 3) Determining the intellect for non address from the AMC and cross checking it with the government issue when necessary.Identifying discharges with grim bothers and solving issues accordingly. The major findings argon 1. The event geters atomic spot 18 very limited rough the SKU that they nightspot. Changing the SKU if the one companyed was not acquirable led to send awaycellation of purchase govern several(prenominal)(prenominal) generation. Such toilettecellation of localizes affects the fill rate. Hence, if any SKU is not available, the order should full be outback(a) instead of being changed to on the button about other SKU. 2. Even though the AMCs argon needful to call the pertain stack when an order gets scrub and inform about it, they ar not pickings it seriously.The AMCs need to study that this is in the best inte succour of either one as the problem can be cured once and for all if they take suitable action. So, this process ineluctably to be oblige strictly. 3. It has been find that it is very difficult to track wrong deliveries where in the products be delivered to several(prenominal) individual/ proceeds objet dart the invoice is printed against or so other military issue where spoken communication did not happen. This can be stopped by machineing a token system where the outlet experienceer acknowledges the AMC upon speech using just about token. Table of limit PageAcknowledgementv Abstract. vi Table of Contents.. 1 arguing of bets 3 List of Tables4 List of Appendices. 5 List of Abbreviations. 6 I entrance7 1. 1 A BRIEF invention OF THE COCA-COLA COMPANY.. 7 1. 2 INTRODUCTION OF HCCBPL7 1. 3 fancy up ANALYSIS OF HCCBPL.. 8 1. 4 PROBLEM FORMULATION9II explore PROBLEM10 2. 1 PROBLEM avowa l10 2. 2 OBJECTIVES10 2. 3 PROJECT DELIVERABLES10 2. 4 CHALLENGES. 10 IIIBACKGROUND OF THE STUDY11 3. 1 RSU system. . 11 3. 2 DRAWBACKS OF RSU METHOD.. 11 3. 3 PRE-SALE METHOD.. . 11 3. 4 RIGHT EXECUTION DAILY ( cerise) 12 3. 5 distribution SYSTEM IN COCA_COLA.. 12 3. 6 PROCESSES FOLLOWED14 3. 6. 1 ensn atomic number 18 GENERATION. 14 3. 6. 2 vagabond INTEGRATION14 3. 6. 3 INVOICE AND SETTLEMENT15 IV RESEARCH DESIGN 16 4. 1 RESEARCH METHODOLOGY. 16 4. 2 DATA disposition. 16 4. 3 FINDINGS GAPS IN DISTRIBUTION. 16 4. 3. 1 SKU availableness. 16 4. 3. 2 STOCKOUT OF COCA-COLA 17 4. 3. 3 WRONG DELIVERY 18 4. 3. 4 DAMAGE TO VEHICLE. 18 4. 3. 5 SHOP shut19 4. 3. 6 BIG VEHICLE UNABLE TO REACH OUTLETS IN LANES.. 19 4. 3. AMC NEW TO THE ROUTE 19 4. 3. 8 FAKE ORDERS. 20 4. 3. 9 MISCELLANEOUS REASONS 20 VRESULTS AND CONCLUSIONS. 21 VIRECOMMENDATIONS. 24 References.. 25 Appendices. 26 List of Figures Figure No. Description Page 1 statistical distribution ne twork depiction count and in fi gure routes. 13 2 dissemination Channels depicting flow of Fulls and Empties.. 14 3 graph depicting the variations in fill rate for school routes. 2 4 Graph display the overall increasing curve in surfeit rate mensurable as simple middling week wise.. 22 List of Tables Table No. Description Page 1 run into grazes in the direct routes. 21 2 Simple honest of the fill rates of the AMCs in the inclined duration. 23 List of Appendices Table No. Description Page 1 satisfy number26 List of Abbreviations HCCBPL Hindustan Coca-Cola Beverages Private Limited CCI Coca-Cola India MD Market Developer AMC Area Market Controller RSU Ready spud UnitRGB Returnable Glass Bottle RED Right Execution fooling PJP Permanent Journey Plan CFA Carry & angstrom unit Forward Agents matinee idol Glass on adhere ROD Return on Deposit RTM Route to Market STL Sales Team Lead SKU burgeon forth holding Unit Chapter 1 INTRODUCTION 1. 1 A BRIEF INTRODUCTION OF THE COCA-COLA COMPANY The Coca-Cola Company is the worlds largest drunkenness company direct in more than 200 countries. It has a portfolio of more than 300 beverage products including sparkling drinks and still beverages such as waters, juices and juice drinks, teas, c outees, sports drinks and energy drinks.The Coca-Cola Company was incorporated in 1892 and is headquartered in Atlanta, Georgia. Coca-Cola originated as a soda jet plane beverage in 1886 selling for five pennys a glass. Early applyation was impressive, but it was only when a strong bottling system developed that Coca-Colabecame the world-famous send it is to solar daylight. The companys beverages are served over 1. 6 chronicleion snips every day. The company operates afranchiseddistribution system. The Coca-Cola Company manufactures the concentrates, beverage bases and syrups which are because sold to unlikebottlersthroughout the world who hold an sole(a) territory.The bottling partners play a critical utilisation in the Coca-Co la system as the producers and allocators of closelyly 500 beverage brands and they range from international and publicly-traded businesses to small family- owned operations, the abundant majority of which are not owned or controlled by The Coca-Cola Company. The bottling partners are responsible for producing, packaging, distributing and merchandising the beverage products worldwide. gust has kins with terce types of bottlers in unfreely owned bottlers where the company has no possession inte ride out bottlers where the ompany has invested but has a non-controlling proprietorship interest and bottlers where the company has invested and has a controlling interest. Separate contracts, or bottlers agreements, exist betwixt cytosine and each of its bottlers regarding the manufacture and sale of Coke products. The Bottlers Agreements authorize the bottler to prepare designated Coke trademark beverages, package the drinks in authorized containers, and then sell the final product i n an determine territory. Bottlers are obligate to purchase all of their concentrates and syrups for designated Coke trademark beverages from the companys authorized suppliers 1. INTRODUCTION OF HCCBPL Hindustan Coca-Cola Beverages Private Limitedis nose candy% company owned Bottler in India and reports directly to The Coca-Cola Company. It has 3 business regions, north, south and central, and operates out of 22 mends across India. The business model includes manufacturing the beverage, distribution and sales, trade marketing and market execution. Coca-Cola was the leading soft drink brand in India until 1977 when it left(a) rather than reveal its formula to the government and reduce its equity stake as required under the Foreign Exchange Regulation wreak (FERA) which governed the operations of foreign companies in India.After a 16- course absence, Coca-Cola military issueed to India in 1993, cementing its presence with a deal with Parle that gave Coca-Cola ownership of the n ations top soft-drink brands and bottling network. Cokes acquisition of local anaesthetic popular Indian brands including Thums Up, Limca, Maaza, Citra and Gold Spot provided not only corporal manufacturing, bottling, and distribution assets but also strong consumer preference. With access to 53 of Parles coifs and a well set bottling network, an excellent base for the rapid penetration of the companys international brands was formed.This combination of local and global brands enabled Coca-Cola to exploit the benefits of global branding and global trends in tastes dapple also tapping into handed-down domestic markets. Leading Indian brands joined the Companys international family of brands, including Coca-Cola, Diet Coke, fay and Fanta. Coca-Cola operates through Company own Bottling Operations (COBO) or Franchise Owned Bottling Operations (FOBO) which have demarcated territories. While HCCBPL is COBO, Moon and Enrich are FOBOs in the Delhi region.HCCBPL purchases the concent rates and beverage bases from Coca-Cola India (CCI) which is also responsible for local marketing and R&D apart from holding the concentrates. Every action underinterpreted in Coca-Cola is in some way related to ensuring Activated Chilled Availability of beverages to its consumers. Activation refers to the colloquy to end consumers regarding the accessibility of respective(a) SKUs of cold drinks and price communication. Chilling refers to the availability of cooler/ice box which ensures that the product is served in a chilled form.Availability refers to do sure that the brand requested by the consumer is available at the outlet. patronage registering worlds highest sales volume growth of 29 per cent in India, the per capita utilization of its beverages in India is currently at 11 servings a year (up from 7 servings a year in 2001) which is very little when compared to 600+ servings a year in Mexico. This when combined with Indias one billion plus population and an acclivi tous middle class makes it one of the virtually coveted markets for soft drinks across the world. 1. SWOT ANALYSIS OF HCCBPL Strengths * Distribution profit With a number of efficient salesmen, over 700000 retail outlets and 8000 distributors, Coca-Cola has a reliable distribution network. * Focus on Quality The Coca-Cola Companys internal global forest weapons platform called The Coca-Cola Quality System (TCCQS) not only covers environment management, but also takes into consideration other business aspects such as safety and loss Prevention (SLP), product quality, packaging quality, process capability rise and guest satisfaction.Strict compliance with TCCQS, often rated as a program kindred to the internationally reputed ISO 14001 System, has also enabled all the company-owned bottling plants in the country to successfully get the coveted ISO 14001 Certification from Det Norske Veritas (DNV). * Strong Brands People across the world soft recognize Coca-Cola and Sprite, Fant a, Limca, thums Up and Maaza have a strong brand flesh across the country. Weaknesses Small Scale Sector Reservations The Companys operations are carried out on a small scale and collect to Government restrictions the Company finds it very difficult to invest in scientific advancements and achieve economies of scale. Opportunities * Low Per capita Consumption Despite registering strong growth in India, the per capita consumption in India is very less at 11 servings per year when compared with other countries like Mexico where it is 600+ servings per year and USA where it is 400+ servings per year. Large untapped Domestic Market With one billion plus population and an emerging middle class, India is one of the about attractive soft drink markets in the world. Threats * License Whenever the production capacity call for to be change magnitude, the company result have to renew or update the license which is a awkward process. This is because the production capacity is mentioned on the license. 1. 4 PROBLEM FORMULATION Distribution ( get in) is one of the four elements of the marketing mix and it plays a unwrap role in passing the product along the distribution channels.The products produced at the manufacturing plant (Dasna) break the computer memorys and from there they reach the end consumer either through a direct route (directly to customers) or an indirect route (passing through sub-distributors/middlemans to customers). in that location is a massive demand for the soft drinks especially in summer and distribution system should be reliable to supply the soft drinks to customers as promised on a day-to-day basis. In the direct routes, MDs generate orders for mingled retail outlets and AMCs deliver the orders the next day.STL or Sales Executives overlook the MDs opus RTM is responsible for the AMCs. in that location should be a strong co-ordination between these two departments if the distribution system was to be perfect as the MDs and AMCs are the frontline workers. However, not everything goes as planned and some cadences delivery does not happen to the retail outlets as promised. This is due to the presence of certain gaps in the distribution system. There is a need to identify these gaps and bridge them in order to alter the distribution system and hence the overall sales.The efficiency of the distribution is mensural in terms of engross direct. RED urinates of the outlets is directly dependent on the Availability of products which accounts for 60 of the 100 points. So, the objective of the project includes identifying the gaps in the distribution system in direct routes by finding out the reasons for non delivery of products as per order knowd the previous day and trailing the performance of the AMCs in direct routes. For this specific study, only Dilshad Garden which caters to East Delhi has been taken into consideration.The direct routes serviced by Dilshad Garden depot have been analyze and the performance of the AMCs has been analyzed. CHAPTER 2 RESEARCH PROBLEM 2. 1 PROBLEM STATEMENT In a company like HCCBPL where the products have a huge demand and are sold so fast that the retailers sources need to be replenished on a daily basis, the distribution network assumes a huge significance. MDs, AMCs and the availability of soft drinks ordered are the three life-and-death aspects of the distribution system as far as direct routes are concerned and any shortcoming in any one of these leads to non delivery of products to the customers.These distribution gaps not only affect the Fill Rate but also affect the RED scores of the outlets. Hence identifying the distribution gaps and bridging these gaps is quite essential in improving the distribution network of the company. 2. 2 OBJECTIVES * To find out the reasons for non delivery of products to the outlets from the AMCs and cross check it with the outlets. * To identify the foot cause of the persistent problems present in the distribution n etwork and work them. * To monitor the performance of the AMCs in direct routes. 2. 3 PROJECT DELIVERABLES Root-cause abstract of the various issues place in the distribution network. * passs for bridging the distribution gaps in direct routes. * Fill Rates of the AMCs in direct routes 2. 4 CHALLENGES * The AMCs do not always cooperate when asked about the reasons for non delivery as they see it as being questioned for non performance instead of looking at it as an action necessary for resolving the issues. * Some of the phone number of the outlets are switched off/ wrong come and this limited the ability to corroborate the reasons given by AMCs. 3. BACKGROUND OF THE STUDY . 1 READY STOCK UNIT (RSU) METHOD Earlier Coca Cola used to follow Ready Stock Unit (RSU) method. In this method each AMC (Salesman) carried a truck full of load to a predetermined sweep and went to each retail outlet and sold the load as per the requirement of the outlet and availability of disparate SKUs available on the vehicle. The drawback of such a method was that there was no accountability for the AMC and most of the outlets were left uncover. In the RSU method, the salesman generated orders and delivered the products simultaneously. 3. 2 DRAWBACKS OF RSU METHODIn the RSU method the salesman had a virtual monopoly over the area that he visited. The salesman could sell all the beverages to just 3-4 outlets in the area and leave the rest of the retail outlets dry. If the relation between a retail outlet owner and the salesman soured it would mean that the retail outlet would find it very difficult to get Coke products. The retail outlet owners were mostly un aware of the stratagems and discounts offered by the company. There was no contract on the part of salesman to distribute the products fairly among all the outlets in the area. . 3 PRE-SALE METHOD Pre-Sale method was introduced to bridge the gap between the company and its customers. A pre seller generates orders in adv ance after activating the outlet. He also communicates the schemes and promotional offers to the outlets. Delivery vehicles are loaded as per the orders leading to high vehicle capacity utilization and very less shortage of required SKUs to the retail outlets. The outlets in an area are divided among Tell swap and MDs such that the orders are taken from the outlets depending on the volumes sold by them.Diamond Outlets are serviced more ofttimes than the Gold outlets, Gold Outlets more than Silver and bronzy ones. A Permanent Journey Plan(PJP) determines which outlets will be covered by the MDs and which ones by Tell Sell and on which days. All the MDs carry an MC35 shape with them and all these MC35s are integrated to a common emcee where each order can be tracked along with the time at which the order has been taken. 3. 4 RIGHT EXECUTION DAILY (RED) One of the key strengths of the company is its ability to directly reach its customers incessantly.The sales people are dedicated to building strong and constructive relationships with every one of the various customers, including kiosks, grocery stores, convenience stores, hotels, restaurants, cafes, and bars among others. With such a diverse customer base the sales force has to be highly specialized to understand how to best fulfill customers needs. In pursuit of excellence in market place execution, Coca-Cola has been implementing a program we call Right Execution Daily (RED).This program monitors, at the individual outlet level, how well the merchandising standards are employ and maintained. Furthermore, it helps identify opportunities to make immediate improvements that support growth for both customers and the company. RED is just one part of the companys efforts to enhance gross growth opportunities by optimizing the combination of brand, package and price for each consumption occasion. A closer partnership with the customers of the company helps drive a sustainable growth of the business.One of the key strengths of Coca-Cola is its ability to achieve quality in-store execution by having over 17,000 highly trained sales representatives regularly serving approximately 1. 5 million outlets. This direct interaction with customers gives the company a warlike advantage in activating points of purchase and creating value for both customers and its own business. Working together with customers as one team translates into higher customer satisfaction and measurably improved performance. An analysis of the results helped identify key factors that affect shopping references and ha silicon chips.Focusing on these factors, a set of solutions have been crafted such as repositioning the products on display or re-modeling the entire store, which resulted in let on business and increased sales for the customers participating in the program. RED pile has been started in 2007. It adds value to customers and consumers through Excellence in Execution at the point of sale. For conducting RED su rvey, HCCBPL has hired ACNielsen Company, one of the best market research firms in the world. In the first week of every month, a periodic report on RED scores is sent to HCCBPL by ACNielsen.RED score is figure for a total of 100 points out of which 60 points are for Availability, 25 for Cooling and 15 for Activation. 3. 5 DISTRIBUTION IN COCA-COLA The manufacturing of all the beverages catering to Delhi takes place in the Dasna manufacturing plant located in Ghaziabad, near Delhi. Dasna plant is completely owned by Hindustan Coca-Cola Beverages Private Limited. The beverages are then brought to the depots which are operated by Carry Forward Agents (CFA). There are three depots currently operating in Delhi located at Dilshad Garden (referred to as DG), Lawrence Road (referred to as LR) and Okhla.From the depot, the beverages reach the customers either through a direct route or an indirect route. If the trucks carry the beverages directly to the retail outlets as per the order giv en by these outlets the day before, it is referred to as Direct Route. If the beverages reach the retail outlets through a sub distributor or a wholesaler then it is referred to as an Indirect Route. A wholesaler operates from a single shop and has low margin and a high turnover. The wholesaler is not confined by a fixed territory. In contrast, distributor and sub distributor have defined territories.A distributor world(a)ly makes a huge enthronization and is committed to Coca-Cola where as a sub-distributor makes lesser investment and is not committed to Coca-Cola. He seeks out opportunities from other companies as well. Figure1 Distribution Network depicting direct and indirect routes Figure 2 Distribution Channels depicting flow of Fulls and Empties 3. 6 PROCESSES FOLLOWED 3. 6. 1 ORDER GENERATION Every day each MD gets an SMS in the morning which mentions which all SKUs and in what quantities are not available in the depot. So, ideally, the MD is not supposed to take orders fo r those SKUs.Each MD visits the outlets one by one as per the PJP and punches the order given by retail outlets into the MC35 cable car that he carries with him. All the MC35s are integrated to a central server and each order can be traced from the system. The MD also explains the various discount schemes provided by Coca-Cola for the direct route retail outlets and is responsible for energizing of the outlets. The MD is responsible for registering new outlets, fetching down complaints regarding fridge disorders, option the RED tracker sheet and arranging the drinks in the visi-cooler as per the predefined arrangement. . 6. 2 ORDER INTEGRATION Every night the dump of all the orders is taken ColaNet which includes orders of MDs and orders taken through Tell Sell. This has details of Outlet DD Code, Outlet name, Outlet address, hunting lodge Code, Item Code, Quantity in cases and each, market area code, route id and instalment number among others. Using RoadNet these orders are separated according to the Route Ids and an AMC is charge for each Route. RoadNet makes use of the study about vehicle capacities, sequence numbers and market area codes while allocating outlets to different routes. 3. 6. INVOICE AND SETTLEMENT When AMC comes for route ride next morning, his brood is loaded with the route details which will load details of outlets and orders into the handle. When the AMC delivers the drinks to any outlet, he prints an invoice and gives it to the outlet while retaining a re-create of it with him. The AMC can only print invoices against the names of outlets in his particular route which are loaded in the handle and not against any other outlet. When a vehicle goes out of the depot in the morning with the load, a load sheet is printed against the AMC who is responsible for the vehicle.The load sheet includes the hark of SKUs and quantities loaded into the vehicle. When the vehicle returns in the evening, a pullulate sheet is printed which include s a list of all the drinks (SKUs and quantities) left on the vehicle when it is suss out in. Also the number of empty RGBs is matched with the number of Full RGBs that were loaded on the vehicle in the morning. Each AMC is allowed to report a breakage of 2 Empties and 2 Fulls every day. Finally, the account of each AMC is colonized taking all these into account. Glass on Deposit ( god) Lets say an AMC delivered 1 crate (24 bottles) of 300ml Coca-Cola to an outlet named Sai Agency.Sai Agency only had 19 Empty bottles (also referred to as Empties) and agreed to pay for the rest of the bottles in cash. Then the AMC prints a GOD bill for 5 bottles (5*5=25Rs) and collects the amount from Sai Agency. If the number of empty bottles light up short when the vehicle checks in, the AMC will have to pay for these missing bottles from his own pocket. Return on Deposit (ROD) The next day if Sai Agency returned the 5 empty bottles, then that will reflect on ROD bill printed for those 5 bottles a nd Sai Agency gets back its 25Rs. 4. RESEARCH DESIGN 4. 1 RESEARCH METHODOLOGYThe delivery list for each route gives the list of outlets that should be covered on that day for delivery. Whenever delivery happens in an outlet an invoice is printed against that outlet for the list of items delivered and it includes the discount provided. 1) The first step is to identify which all outlets have not been covered for delivery by the AMC on that day. 2) A list of outlets against which invoices were printed when matched against the list of outlets in the delivery list for that route gives us the outlets where delivery has not happened on any given day. ) Establish the reason for non delivery in a particular outlet by calling the concerned AMCs and by cross checking with the outlets if necessary. 4) Check if it is a one off incident or a repeat occurrence and take action accordingly. 5) mobilise random outlets and check that the delivery happened to the correct outlet and that it was not a wrong delivery. 6) The performance of AMCs is measured by calculating Fill Rate for the corresponding routes. 7) The Fill Rate for all the direct routes combined is calculated to estimate the performance for that day in direct routes.A macro has been compose to calculate AMC route wise fill rates saving time and effort. 4. 2 DATA COLLECTION The invoice history report gives the details as well as the summary of the invoices printed the previous day. The dump taken from ColaNet gives the details of the orders taken for the day both by the MDs and through Tell-Sell. Route Wise delivery sheet with details of orders, outlet wise can also be obtained through ColaNet. 4. 3 FINDINGSGAPS IN DISTRIBUTION 4. 3. 1 SKU availability Every morning the Market Developer (MD) gets an SMS stating which SKUs are not available in the depot so that the orders for those SKUs are not taken.However, sometimes it so happens that the SKUs that were expected to arrive on a day had not arrived but there are o rders taken for that SKU by the MDs. When the orders are integrated in the night, these orders for the unavailable SKUs are changed into some other SKU that is available. When the AMC goes to the outlet the next day, chances are that the outlet owner declines the delivery as it was not exactly what he ordered the previous day. Several orders get cancelled because of the resembling reason and the AMC brings back all this leftover beverages as there are no takers and this affects his Fill Rate.Root bowel movement Although the MDs get an SMS stating the availability of SKUs, it might not always be accurate. Sometimes the SMS might come a bit too late in the day informing that there has been stock out in some SKU. It could also be sheer disrespect on the part of MD while taking the order. The logic roll in the hay changing these orders for unavailable SKUs into some others those are available at the time of integration is that the outlet owners might just take any other SKU that is available given the high demand for cold drinks in general in summer.The outlet owners are expected to take any other SKU instead of getting nothing despite giving an order. However, what actually happened in the market was quite the contrary. The outlet owners are very particular about the SKUs of cold drinks that they insufficiency and are not ready to budge. As a result most of the orders where there had been a change of order got cancelled and were brought back to the depot by the AMCs. This had a very big mend on the Fill Rates in the direct routes.Recommendation When this issue had been brought to the take note of the depot manager, he had realized that this was thence a major problem resulting in the cancellation of most of the orders and hence stopped changing the orders taken. So, if the orders requested for some SKU which was not available, it is just removed from the order instead of being changed to some other SKU. The implementation of this resulted in lesser cancel lation of orders due to SKU availability problems and in better Fill Rates. 4. 3. 2 Stock out of Coca-ColaThe company offers several discount schemes in the direct routes and these schemes keep changing frequently. Generally, on every 1 crate of 300ml beverages of any SKU, two bottles are offered as free. By default, Coca-Cola bottles are offered as free for any SKU. This turns out to be a problem when there is a stock out of Coke bottles in the depot. When the AMC goes out for delivery and his handle is showing the scheme as giving out 2 free Coke bottles for 1 crate of Limca (300 ml), while actually Coke bottles are not available in the depot/on the vehicle, he cannot print the bill for that and hence the order gets cancelled.Root Cause It is learned that the psyche integrating the orders in the night is informed to make Coke as the default SKU for the free bottles of any other SKU. However, the frequently changing schemes and the changing stock availability in the depot mean tha t the person integrating the orders is not well equipped with necessary information regarding stock outs which gives rise to the problem. Recommendation A suggestion has been made to the depot manager to make a file containing details of stock availability and the details of schemes and share it in the common folder.The person who integrates the data needs to first check out this file to get a assort idea of the schemes and the availability of SKUs before proceeding to prepare the delivery lists. This way, if Coke were to be out of stock in the depot, say Limca or Thums Up whichever SKU is available could be given as free thereby eliminating the scheme problem. 4. 3. 3 Wrong Delivery Every morning before the AMC leaves the depot his handle is loaded for the particular route in which he goes.So AMC can only print invoices only against the names of the outlets appearing in the delivery list of his route and cannot print invoices against any other outlets. Sometimes it so happens that the AMC actually gives away some of the crates of drinks to some individual/outlet which is not in the delivery list and prints the invoice against one of the outlets in the delivery list even though he did not actually deliver the order of that outlet. This does not have any effect on the Fill Rate of the AMC as such but it affects the RED scores of those outlets where delivery did not happen as 60 points out of the total of 100 re for availability. Recommendation In order to foreclose the wrong deliveries, some kind of acknowledgement is needed from the outlet owners which indicate that the AMC has actually visited the outlet and not maked an invoice. It is not feasible to set aside one person just to call all the outlets and cross check the invoices at the end of each day in all the routes. It was suggested that the AMCs get the one C copy of the invoices (that are brought back along with them) signed by the owners of the outlet.But, it was told that the outlet owners have a widespread perception that when they sign on the invoices, it would mean that they are taking the delivery on credit and hence that suggestion could not be implemented. Then it was suggested that the AMCs get the carbon copies of invoices stamped by the outlets to prevent devise invoices. However, even that suggestion could not be implemented as stamping the carbon copy of invoice is done only by the incentive parties and not by other outlets. As preventing wrong delivery is one crucial step in improving RED scores, another suggestion is to implement some kind of token system.When the MD visits each outlet for taking the orders, he can give a token which is collected by the AMCs the next day upon delivery to the outlets. This would also prevent wrong deliveries and sidestep invoices. 4. 3. 4 Damage to the vehicle There have been authoritys when the vehicle was alter mid way through the route or sometimes just as it moved out of the Dilshad Garden depot. There has also been an i nstance when the vehicle met with an accident and the AMC had to sit in police station for the rest of the day.In such situations, the rest of the outlets in the route do not receive any delivery which drastically affects both the Fill Rates of the AMCs and the RED scores due to non availability of drinks. Recommendation A back-up vehicle needs to be maintained in the depot which can cover for the shamed vehicle when need arises. If the costs do not allow a spare vehicle to be maintained in the depot, at to the lowest degree a mechanic should be dispatched immediately to the location to rectify the revile as quickly as possible. 4. 3. 5 Shop ClosedOne most common reason given by the AMCs when delivery does not happen in some outlets is that the shop is closed. Upon cross checking with the outlet it is found that the shop was indeed closed. There are some specific areas where shops are usually closed on a particular day in the week. For example, in Murga Mandi area, most of the o utlets remain closed on Tuesdays. Also most of the Dairies (like MAL Dairy in Madhu Nagar) remain closed through the afternoon and so any order for these dairies need to be delivered in the morning itself.Recommendation If it is cognize that the outlet ashes closed on a particular day, then the MD should be asked not to take the order for that outlet on the day before. For example, MD visiting Murga Mandi area should be given his weekly off on Monday so that no orders will be due for delivery on Tuesday in the area when the outlets remain closed. Also when it comes to dairies, if it is feasible for the AMC to deliver the order of the dairy before afternoon without having to make a detour from his prevalent route, then it should be done so.If that were not feasible then the MD should be asked to stop taking orders from that particular dairy and it should be removed from the MDs PJP. Taking the order and not delivering it leads to both customer dissatisfaction and affects Fill Rate of the AMC as well. 4. 3. 6 Big Vehicle unable to reach outlets in small lanes There have been several instances of AMC complaining that the outlet could not be reached on the big vehicle as it is located in some small lane. There have been a few instances where the outlet belonged to some sub-distributors area and the MD still took the order.In one particular area (Krishna Nagar) there are several outlets on either side of the road where the vehicle could not be stopped for delivery and hence these outlets are supposedly being moved out of the direct route. Recommendation MD should be asked not to take orders from outlets belonging to some sub-distributor just to increase the number of orders taken. Trolleys need to be provided for the AMCs where the outlets are inaccessible. 4. 3. 7 AMC new to the route nigh of the AMCs are experienced and have been waiver in the same routes for quite some time now and are well aware of all the outlets featuring on the delivery list.However, th ere have been instances where an AMC is new to a particular direct route and is not well aware of the location of the outlets. The AMC could be a one off electric switch for the AMC regularly going in that area or he could be new to direct routes. In such cases, it has been observed that the AMCs do not take persistence of calling the MDs for finding out the location of the outlets which they could not find. They just return all the orders for the outlets they do not find. Thus when a new AMC goes in a direct route an abysmal drop in the Fill Rate for that route has been observed.Narender Sharma is a case in point for the Dilshad Garden depot. Recommendation The AMCs should be made to call the MDs in case they are not able to find the location of any outlet. The AMCs should have the numbers of the MDs of that particular routes and it should be made clear that not being able to locate any outlet is not a good affluent reason to not deliver the order for that outlet. 4. 3. 8 Fake o rders Most of the times the outlet owners just reject the delivery saying that they havent given any order in the first place the previous day or that they have ordered for a different SKU than what appears in the delivery list.When the outlet owner says that he has not given any order the previous day it could mean one of the two things. First, the outlet owner is lying as he does not want to take the delivery due to some other reason like not having enough money or already having enough stock in his cooler. Second, the MD has punched in a fake order. A fake order means that the MD has not visited the outlet the previous day but has punched in some random order under the outlet just to meet his target for the day in terms of the number of crates.When an order gets cancelled due to any of these reasons, it is the responsibility of AMC to confront the MDs for taking fake orders and inform the STL concerned that the MD has taken a fake order. If this communication does not happen, th en there is no other way for STLs to come to know of fake orders being taken by MDs. Recommendation It is already suggested that the AMCs call MD/STL without fail when the outlet rejects the delivery. However, this has not been enforced properly and the AMCs are not following these instructions despite repeatedly asking them to do so.The AMCs should be strictly warned to comply with the procedure so that fake orders can be minimized and Fill Rate can be improved. 4. 3. 9 Miscellaneous reasons Upon close observation, some outlets have been identified where there have been persistent issues for quite a while and delivery in these outlets did not happen for months together. Some of the issues include problem with scheme, replacement and incentive party. For example, for the outlet named Shaheen Pan located in Mayur Vihar Phase1, there has been a problem with the discount scheme right from the beginning.Still, orders are taken for that outlet every other day even though delivery does no t happen. This affects the fill rate of the AMC going in that route. Recommendation These kinds of outlets need to be singled out and issues refractory one by one. The responsibility to identify the problems should rest with the AMC because he is the one who gets to know of the problem. Instead of just ignoring it, the AMC should be asked to report such issues to the STLs concerned so that the problem can be resolved once and for all. CHAPTER 5 RESULTS AND CONCLUSIONSThe following table gives the Fill Rates in the direct routes in Dilshad Garden depot for the given dates. Date Direct Route Fill Rate 4/29/2010 65. 38208 4/30/2010 76. 58787 5/1/2010 78. 9128 5/3/2010 71. 20842 5/4/2010 71. 97019 5/5/2010 72. 72874 5/6/2010 75. 89733 5/7/2010 70. 40817 5/9/2010 75. 67431 5/10/2010 78. 7004 5/11/2010 72. 59727 5/12/2010 74. 52693 5/13/2010 68. 4801 5/14/2010 74. 24813 5/15/2010 80. 77308 5/16/2010 81. 0852 5/17/2010 74. 33275 5/18/2010 80. 26975 5/19/2010 82. 7375 5/20/2010 80. 17823 / 21/2010 75. 66602 5/23/2010 81. 29576 5/24/2010 80. 03314 Figure 3 Graph depicting the variations in fill rate for direct routes It can be observed that the fill rate for the direct routes has increased from mid 70s to 80s with one-off variations. A simple average of the fill rates for the four weeks shows a general increasing trend. Figure 4 Graph showing the overall increasing trend in Fill rate calculated as simple average week wise The simple average is calculated by taking an average of the fill rates of direct routes for each weeks data.This shows a general increasing trend with the average fill rate increasing from around 72% in the first week of May to around 80% by the end of third week. A simple average of the fill rates of the AMCs in spite of appearance this duration is as follows AMC Name Fill Rate* Kalyan Singh 88. 37654 Ashok Sharma 87. 76629 DK Sharma 85. 03183 Uday Singh 84. 6047 Sajan padiyar 82. 70731 Rakesh Kumar 77. 69646 AK Shukla 77. 00473 CP Shukla 75. 74619 Suraj Sawaria 74. 75485 Laxman Singh 71. 65821 Kapil malhotra 69. 60537 Rajesh Tiwari 66. 83779 Narender Sharma 61. 06509This indicates that Kalyan Singh has been performing most consistently from among the AMCs going in the direct routes. It has been observed when on a route ride with Kalyan Singh that he maintains a very good relationship both with the outlet owners in the area and with the MD responsible for the area. Narender Sharma has more often been a replacement for some other AMC and not regular for the direct route which shows in his Fill Rate. CHAPTER 6 RECOMMENDATIONS 1) If the orders request for some SKU which is not available, it should be just removed from the order instead of being changed to some other SKU. ) If Coke is out of stock in any of the quantities, the discount scheme should be suitably modified so that a problem does not arise while printing invoice with the handle at the time of delivery by AMC. 3) IN order to prevent wrong delivery, some kind of token system where the outlet owner acknowledges receipt of products from the AMC needs to be implemented.4) In order to prevent complete loss of sales in a route due to vehicle damage, a backup vehicle should to be maintained at the depot. ) If it is known that some outlets are closed on particular days of the week, MDs should be asked not to take orders for those outlets the day before. 6) Trolleys need to be supplied to AMCs in order to reach certain outlets which are located in small lanes where the vehicle cannot reach the outlet. 7) The process of calling MDs/STLs when order gets cancelled due to rejection from outlets should be enforced strictly.REFERENCES http//en. wikipedia. org/wiki/The_Coca-Cola_Company http//www. thecoca-colacompany. om/ourcompany/the_cocacola_system. html http//www. coca-colaindia. com/aboutus/aboutus_ccindia. aspx APPENDIX 1 Fill Rate Fill Rate is a measure of the amount of order delivered versus the amount of order initially received for a given day. Calcul ation Number of crates of order delivered / Number or crates of order received Example The total order received in a route for a given day is 100 crates. However, only 80 crates of beverages have been delivered in that route on that day. Then the fill rate for that route is given as 80/100 or 80%.