INTRODUCTION

Britannia Industries Limited (BIL) is a major player in the Indian Foods market with
leadership position in Bakery category. Its brand portfolio includes Tiger, Marie Gold, Good
Day, 50:50 and Treat. The Company was born in 21st March of the year 1918 as a public
limited company. The Company's plants are situated in Kolkata, Delhi, Chennai, Mumbai and
Uttarakhand.
GOOD DAY: Britannia is the leader in the cookies segment. Britannia Good Day was
launched in 1986 in two delectable avatars - Good Day Cashew and Butter. Over the years,
new variants were introduced - Good Day Pista - Badam in 1989, Good Day Choco chips in
2000 and Good Day Choconuts.

Good Day Butter is the only premium brand that is availab le at only Rs. 5/Good Day is the no. 1 brand among cookies in India.
Good Day is the best selling biscuit in the urban areas.
Good Day appeals to young and old alike.
The quality of GOOD DAY is much better, compared to its competitors. It
is much crispier and also has a rich butter taste added to it.

PHYSICAL DISTRIBUTION CUM LOGISTICS STRATEGIES

As biscuits and cakes need to reach the consumer at their nearest locations. So,
INTENSIVE DISTRIBUTION channel is used. This type of distribution helps customer
looks for location convenience.
In this type of distribution channel, the manufacturer places the goods or services in as many
outlets as possible. This strategy is generally used for the items like snacks food, soft drinks,
newspapers , candies and gums, etc., like products which the consumers desires to buy
frequently or in a variety of locations. And hence appropriately, this type of distribution is
adopted by the Britannia Company for its GOOD DAY brand which falls in the category of
snacks food items.

PHYSICAL DISTRIBUTION starts at the factory. Manager at Britannia make decision of

warehouse and transportation carriers that will deliver the goods to final destination in the
desired time at the lowest cost possible
Major players in the distribution network are as mentioned below:

Depots
Wholesalers
Agents (If required)
Retailers

Britannia has nearly 1800 wholesalers catering to 5,01,000 retail outlets directly or indirectly.
It also has a strong dedicated field force service which is around 200 in numbers.
Additionally there are 48 depots, supplying goods to its wide distribution network.

Britannia has level 1, level 2, level 3 distribution channel levels.

Level 1:
MANUFACTUR
ER

RETAILER

CONSUMER

Availability of Britannia biscuits at all the departmental stores across the country

Level 2:
MANUFACTUR
ER

WHOLESALE
R

RETAILER

CONSUMER

Since its an FMCG product, this channel exists for the customers spread across India

Level 3:
MANUFACTUR
ER

WHOLESAL
ER

AGENT

RETAILE
R

CONSUME
R

Mass consumption and suitable for both domestic and international coverage
Its logistic strategies include material management, material flow systems and physical
distribution aided by information technology (IT).

PLACE
For FMCG products, distribution channels are very important. For biscuits, distribution and
visibility are extremely important as it's partly an impulse purchase product. And in biscuits,
setting up a distribution channel is anything but easy.
Britannia Industries Ltd. is one of India's leading producers of biscuits and other bakery
products. The company is partially owned by the French company Group Danone, one of the
worlds largest food products company. BIL has a widespread retail distribution network that
services 400,000 retail outlets in 2,200 towns with the help of 2,500 distributors. In addition
to this, the company is constantly expanding its product portfolio and retail network.
Britannia's managers are constantly on the move, given this breadth and depth of its business
and the geographic spread
The companys plants are located in Indias four major metropolitan cities Kolkata in
eastern India, Chennai in southern India and Delhi and Uttaranchal in northern India.
Combined, these facilities employ more than 4,300 people and yet only make 30% of the
companys products. Sixty-one other contracted factories produce the remaining 70% of
Britannias product line.
While the premium end of the market has seen a flood of new entrants, including several
multinational brands, Britannia, with its established distribution network, appears to be in a
better position to capitalise on the growth in the mass market. Apart from stockists and substockists, Britannia has used traditional haats and melas to promote the GOOD DAY brand. It
has made the ongoing Kumbh Mela a major promotion and sales outlet to capture the rural
market. Whenever there is a major mela or haat, Britannia ensures that its brand is stocked in
large quantities.
SUGGESTIONS FOR THE BRITANNIA DISTRIBUTION CHANNELS:
Increase the margins:
Motivate the various channel members as it is very important factor for the increasing the
margin for the hard selling items.
Pushcarts:
These should be increased in number so as to increase the penetration in market especially in
rural market

FUNCTIONS OF ENTITIES
A marketing channel performs the work of moving goods from producers to consumers.it
overcomes the time, place, and possession gaps that separates goods and services from those
who need or want them. Members of marketing channel (entities) perform the following key
functions:

Gather information about potential and current customers, competitors, and other
actors and forces in the marketing environment:
o As performed by retailers, agents as well as the marketing department of the

manufacturers company.
Develop and disseminate persuasive communications to stimulate purchasing:
o This function is executed by at two levels, i.e.; first by the supplier and
secondly by the manufacturer for influencing the end consumers in the favour

of the product.
Reach agreements on price and other terms so that transfer of ownership or possession

can be affected.
Place orders with manufacturers: as placed by the wholesalers.
Acquire the funds to finance inventories at different levels in marketing channels.
Assume risk connected with carrying out channel work: this risk is basically bore by
the manufacturer, who needs to carefully examine the marketing channel for his

product.
Provide for the successive storage and movement of physical product: this function
again is meant for the manufacturer at the first end who is needed to provide for
warehousing facility to store his finished and final product. And at the second end, the
wholesaler too needs to provide the same to the retailers who can withdraw products

in quantity as per the demand of the situation.

Provide buyers payment of their bills through banks and other financial institutions.
Oversee actual transfer of ownership from one organisation or person to another.

FACTORS AFFECTING CHOICE OF CHANNEL OF DISTRIBUTION:

Important factors affecting the choice of channels of distribution by the manufacturer are:

(A) Considerations Related to Product

When a manufacturer selects some channel of distribution he/she should take care of such
factors which are related to the quality and nature of the product. They are as follows:
1. Unit Value of the Product:
When the product is very costly it is best to use small distribution channel. For example,
Industrial Machinery or Gold Ornaments are very costly products that are why for their
distribution small distribution channel is used. On the other hand, for less costly products
long distribution channel is used.
Thus, Britannia uses longer channel of distribution as its product are less costly and basically
provides FMCG products of daily use to customers.
2. Standardised or Customised Product:
Standardised products are those for which are pre-determined and there has no scope for
alteration. For example: utensils of MILTON. To sell this long distribution channel is used.
On the other hand, customised products are those which are made according to the discretion
of the consumer and also there is a scope for alteration, for example; furniture. For such
products face-to-face interaction between the manufacturer and the consumer is essential. So
for these Direct Sales is a good option.
Britannia GOOD DAY biscuit is a standardised product; hence longer channel of distribution
is suitable for its physical distribution to the market.
3. Perishability:
A manufacturer should choose minimum or no middlemen as channel of distribution for such
an item or product which is of highly perishable nature. On the contrary, a long distribution
channel can be selected for durable goods. And Britannia GOOD DAY biscuit is durable
product; hence it can afford its distribution through longer channel of distribution.

4. Technical Nature:
If a product is of a technical nature, then it is better to supply it directly to the consumer. This
will help the user to know the necessary technicalities of the product, unlike Britannia GOOD
DAY biscuit which is a food product and not technical product.
(B) Considerations Related to Market
1. Number of Buyers:
If the number of buyer is large then it is better to take the services of middlemen for the
distribution of the goods, as taken by the Britannia GOOD DAY biscuits. On the contrary, the
distribution should be done by the manufacturer directly if the number of buyers is less.
2. Types of Buyers:
Buyers can be of two types: General Buyers and Industrial Buyers. If the more buyers of the
product belong to general category then there can be more middlemen. But in case of
industrial buyers there can be less middlemen.
Britannia GOOD DAY biscuits have general buyers, and hence using services of middle men
is appropriate for the brand.
3. Buying Habits:
A manufacturer should take the services of middlemen if his financial position does not
permit him to sell goods on credit to those consumers who are in the habit of purchasing
goods on credit.
4. Buying Quantity:
It is useful for the manufacturer to rely on the services of middlemen if the goods are bought
in smaller quantity, as in the case of Britannia GOOD DAY biscuits,which are bought by
customers in smaller quantities only.
5. Size of Market:

If the market area of the product is scattered fairly, then the producer must take the help of
middlemen, as in the case of GOOD DAY biscuits.

(C) Considerations Related to Manufacturer/Company

1. Goodwill:
Manufacturers goodwill also affects the selection of channel of distribution. A manufacturer
enjoying good reputation need not depend on the middlemen as he can open his own
branches easily.
2. Desire to control the channel of Distribution:
A manufacturers ambition to control the channel of distribution affects its selection.
Consumers should be approached directly by such type of manufacturer. For example,
electronic goods sector with a motive to control the service levels provided to the customers
at the point of sale are resorting to company owned retail counters.
3. Financial Strength:
A company which has a strong financial base can evolve its own channels. On the other hand,
financially weak companies would have to depend upon middlemen.
(D) Considerations Related to Government
Considerations related to the government also affect the selection of channel of distribution.
For example, only a license holder can sell medicines in the market according to the law of
the government.
In this situation, the manufacturer of medicines should take care that the distribution of his
product takes place only through such middlemen who have the relevant license.

(E) Others
1. Cost: A manufacturer should select such a channel of distribution which is less costly and
also useful from other angles.
2. Availability: Sometimes some other channel of distribution can be selected if the desired
one is not available.
3. Possibilities of Sales: Such a channel which has a possibility of large sale should be given
weight age.

ACTIVITIES OF DISTRIBUTION SYSTEM:

The basic elements of specific functions that make up physical distribution include:
(i)
(ii)
(iii)
(iv)
(v)

Materials handling;
Inventory planning and control ;
Order processing ;
Transportation ; and
A communication system to integrate the physical distribution process.

1. Materials Handling:
It involves moving products in and out of a stock. It consists of routine tasks that can be
performed through mechanisation and standardisation. Efficiency is increased through use of
electronic data processing to control conveyor systems, order picking and other traffic flaws.
The modern mechanised handling services and protective packaging have improved the level
of customer service and at the same time lowered physical distribution costs. Material
handling and packaging services have also speeded up the order processing and movement of
consignments.
2. Inventory Planning And Control:
Inventory refers to the stock of products a firm has on hand and ready for sale to customers.
Inventories are kept to meet market demands promptly. Inventory is the link interconnecting
the customers orders and the companys production activity. In fact, the entire physical

distribution management rotates around the inventory management. Inventory management is

the heart of the game of physical distribution. Marketing managers undertake an inventory
planning to develop adequate assortments of products for the target market and also try to
control the costs involved in obtaining and maintaining inventory.
Marketing managers generally take three decisions while conducting inventory management,
(i) how can the track be kept, on a day-to- day basis of location, amount and the condition of
the inventory?
(ii) How can inventory information best be channelled to production managers or buyers for
resale to help them schedule their activities?
(iii) What inventory information can other departments in the organisation use to help them
perform their functions efficiently?
3. Order Processing:
Order-processing and inventory control are related to each other. Order processing is
considered as the key to customer service and satisfaction. It includes receiving, recording,
filling, and assembling of products for dispatch. The amount of time required from the dates
of receipt of an order up to the date of dispatch of goods must be reasonable and as short as
possible. It comprises in undertaking the processes that are needed to make certain orders
processed quickly, accurately, and efficiently. The marketing manager has to decide about
these along with such issues as what is the most efficient way to bill customers; how cans the
paper work may be minimized? And how can the physical function of assembling orders
more efficiently?
4. Transportation:
It is an essential element of physical distribution. It involves integrating the advantages of
each transportation method by adopting containers and physical handling producers to permit
transfers among different types of carriers.
The marketing manager has to decide to:
(i)

What mode or combination of modes of transportation (rail, truck, pipeline, water

ways or air) should be used to transport products to warehouses and from there to
customers?

(ii)

Should the transportation cost be reduced and the desired levels of customer
service still maintained.

5. Communications:
It is a process of passing information and understanding from one person to another. This
includes the information system which should link producers, intermediaries, and customers.
Computers, memory systems, display equipment and other communication technology
facilitate the flow of information among other members in the channel.
A manager to be successful must develop an effective system of communication. So that he
may issue instructions, receive the reactions of the subordinates, and guide and motivate
them.
6. Organisational Structure:
The person in charge of the physical distribution should co-ordinate all Activities into an
effective system to provide the desired customer service in the most efficient manner.
Examples of organizational consideration are:
(i)

How can the five elements of physical distribution best be coordinated so that a

(ii)

team effort results? How can compartmentalization thinking be avoided?

If a central head is established to direct all physical distribution activities, to
whom should he reportThe Head of the Marketing or The Chief Executive
Officer?

B.R.C.M COLLEGE OF BUSINESS

ADMINISTRATION
MARKETING MANAGEMENT-II
ASSIGNMENT
S.Y B.B.A
NAME:

RIDHIMA SARAF

ROLL. NO.:

210
MANSI SHAH
SHIVANGI SIHOTIYA
230
DIV: III

218

TOPIC: DISTRIBUTION CHANNEL OF

BRITANNIA:

GOOD DAY BUISCUITS.

SUBMITTED TO: DR. PRATIK PATEL

SUBMISSION DATE: 16 MARCH, 2015