The foregoing project entitled “a summer training project report on the overall marketing strategy with special reference to distribution efficiency at IFFCO Patna”, is hereby approved as a creditable study of project topic and has been presented in satisfactory manner to warrant its acceptance as prerequisite to the degree for which it has been submitted. It is understood that by this approval, the undersigned do not necessarily endorse any conclusion drawn or opinion expressed therein, but approve the project for the purpose for which it is submitted. (Internal Examiner) (External Examiner) (Chairman) Head of the Department
Transcript
The foregoing project entitled “a summer training project report on the overall marketing strategy with special reference to distribution efficiency at IFFCO Patna”, is hereby approved as a creditable study of project topic and has been presented in satisfactory manner to warrant its acceptance as prerequisite to the degree for which it has been submitted.
It is understood that by this approval, the undersigned do not necessarily endorse any conclusion drawn or opinion expressed therein, but approve the project for the purpose for which it is submitted.
(Internal Examiner) (External Examiner)
(Chairman) Head of the Department
INDEX
S.No. PARTICULARS Pages1 Acknowledgement 42 Purpose of the Project 5
CHAPTER No.
TITLE
3 1 Introduction about IFFCO 64 2 About the Topic 23
5 3Research objective& Scope of Research
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6 4Research Methodology & Limitations
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7 5 Data Analysis & Interpretation 338 Bibliography 40
ACKNOWLEDGEMENT
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My report has been possible only through the guidance and help from various people. So I, hereby, take this opportunity to thank all those people for their help and encouragement.
I am especially indebted to Dr. Pravir Shukla, Dy. Manager (AS) of IFFCO, who gave me an golden opportunity to get exposed to the wonderful idea and data of IFFCO.
I must also thank all the employees of IFFCO for their support and contributions.
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Purpose of the project
The purpose of this project was to know about marketing strategy in general and distribution efficiency in particular of the company in view of the fertilizer distributor as well as consumer. I wanted to know about the awareness, market demand, comparative quality and different aspects of distribution pf IFFCO fertilizers, in order to test the effectiveness of company’s respective policies
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Chapter 1
Introduction about IFFCO
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IFFCO: Indian Farmers' Success Story
During mid- sixties the Co-operative sector in India was responsible for distribution of 70 per cent of fertilizers consumed in the country. This Sector had adequate infrastructure to distribute fertilizers but had no production facilities of its own and hence dependent on public/private Sectors for supplies. To overcome this lacuna and to bridge the demand supply gap in the country, a new cooperative society was conceived to specifically cater to the requirements of farmers. It was an unique venture in which the farmers of the country through their own Co-operative Societies created this new institution to safeguard their interests. The number of co-operative societies associated with IFFCO has risen from 57 in 1967 to 38, 155 at present.
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Indian Farmers Fertilizer Co-operative Limited (IFFCO) was registered on November 3, 1967 as a Multi-unit Co-operative Society. On the enactment of the Multistate Cooperative Societies act 1984 & 2002, the Society is deemed to be registered as a Multistate Cooperative Society. The Society is primarily engaged in production and distribution of fertilizers. The byelaws of the Society provide a broad frame work for the activities of IFFCO as Cooperative Society.
IFFCO commissioned an ammonia - urea complex at Kalol and the NPK/DAP plant at Kandla both in the state of Gujarat in 1975. Another Ammonia - urea complex was set up at Phulpur in the state of Uttar Pradesh in 1981. The ammonia - urea unit at Aonla was commissioned in 1988.
In 1993, IFFCO had drawn up a major expansion programme of all the four plants under overall aegis of IFFCO VISION 2000. The expansion projects at Aonla, Kalol, Phulpur and Kandla have been completed on schedule. Thus all the projects conceived as part of Vision 2000 have been realised without time or cost overruns. All the production units of IFFCO have established a reputation for excellence and quality. A new growth path has been chalked out to realise newer dreams and greater heights through Vision 2010 which is presently under implementation. As part of the new vision, IFFCO has acquired fertilizer unit at Paradeep in Orissa in September 2005. As a result of these expansion projects and acquisition, IFFCO's annual capacity has been increased
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to 3.69 million tones of Urea and NPK/DAP equivalent to 1.71 million tones of P2O5.
IFFCO has made strategic investments in several joint ventures. Godavari Fertilizers and Chemicals Ltd (GFCL) & Indian Potash Ltd (IPL) in India, Industries Chimiques du Senegal (ICS) in Senegal and Oman India Fertilizer Company (OMIFCO) in Oman are important fertilizer joint ventures. Indo Egyptian Fertilizer Co (IEFC) in Egypt is under implementation. As part of strategic diversification, IFFCO has entered into several key sectors. IFFCO-Tokyo General Insurance Ltd (ITGI) is a foray into general insurance sector. Through ITGI, IFFCO has formulated new services of benefit to farmers. 'Sankat
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Haran Bima Yojana' provides free insurance cover to farmers along with each bag of IFFCO fertilizer purchased. To take the benefits of emerging concepts like agricultural commodity trading, IFFCO has taken equity in National Commodity and Derivative Exchange (NCDEX) and National Collateral Management Services Ltd (NCMSL). IFFCO Chattisgarh Power Ltd (ICPL) which is under implementation is yet another foray to move into core area of power. IFFCO is also behind several other companies with the sole intention of benefiting farmers.
The distribution of IFFCO's fertilizer is undertaken through over 38155 co-operative societies. The entire activities of Distribution, Sales and Promotion are coordinated by Marketing Central Office (MKCO) at New Delhi assisted by the Marketing offices in the field. In addition, essential agro-inputs for crop production are made available to the farmers through a chain of 158 Farmers Service Centre (FSC). IFFCO has promoted several institutions and organizations to work for the welfare of farmers, strengthening cooperative movement, improve Indian agriculture. Indian Farm Forestry Development Cooperative Ltd (IFFDC), Cooperative Rural Development Trust (CORDET), IFFCO Foundation, Kisan Sewa Trust belongs to this category. An ambitious project 'ICT Initiatives for Farmers and Cooperatives' is launched to promote e-culture in rural India. IFFCO obsessively nurtures its relations with farmers and undertakes a large number of agricultural extension activities for their benefit every year.
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At IFFCO, the thirst for ever improving the services to farmers and member co-operatives is insatiable, commitment to quality is insurmountable and harnessing of mother earths' bounty to drive hunger away from India in an ecologically sustainable manner is the prime mission. All that IFFCO cherishes in exchange is an everlasting smile on the face of Indian Farmer who forms the moving spirit behind this mission.
IFFCO, to day, is a leading player in India's fertilizer industry and is making substantial contribution to the efforts of Indian Government to increase food grain production in the country.
Some of the common fertilizer compositions used in India are:
IFFCO's Urea is not merely a source of 46% of nutrient nitrogen for crops, but it is an integral part of millions of farmers in India. A bag of IFFCO's urea is a constant source of confidence and is a trusted companion for Indian farmer.
When farmers buy IFFCO's urea, they know that what they get is not just a product but a complete package of services, ably supported by a dedicated team of qualified personnel. More importantly, they are aware that it is their own urea, produced and supplied by a cooperative society owned by them.
Urea is the most important nitrogenous fertiliser in the country because of its high N content (46%N). Besides its use in the crops, it is used as a cattle feed supplement to replace a part of protein requirements. It has also numerous industrial uses notably for production of plastics.
If urea is applied to bare soil surface significant quantities of ammonia may be lost by volatilisation because of its rapid hydrolysis to ammonium carbonate. The hydrolysis of
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urea can be altered by the use of several compound called urease inhibitors.
These inhibitors inactivate the enzyme and thereby prevent the rapid hydrolysis of urea when it is added to soil. The rapid hydrolysis of urea in soils is also responsible for ammonia injury to seedlings if large quantities of this material placed with or too close to the seed. Proper placement of fertiliser urea with respect to seed can eliminate this difficulty.
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PLANT PERFORMANCE
ProductionSince inception, IFFCO plants have cumulatively produced 1109.03 lakh MT fertilizer upto March 31, 2009. During the year IFFCO produced 71.68 lakh MT fertilizers comprising 40.68 lakh MT Urea and 31 lakh MT NPK/DAP/NP.
Energy Conservation and Capacity EnhancementFor the year 2008-2009 the overall Specific Energy Consumption per tonne of Urea for all the Plants together during the year 2008-2009 was 5.941 Gcal/MT as against 5.907 Gcal/MT in the previous year.
MARKETING PERFORMANCE
Production is a continuous process and therefore, material has to be dispatched continuously to the field warehouses as silo capacity of plants is limited. The volume of fertilizers handled has been increasing year after year and it
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has touched a level of 86 lakh tonne in 2007-08 including 15 lakh tonne imported urea and 2 lakh tonne of DAP fertilizers. This is no doubt a Herculean task and calls for proper logistic planning as well as intensive marketing strategy.
The overview activities of marketing during 2008-09 are as under:
Warehousing
Warehousing is an essential function as production is a continuous process whereas consumption is highly seasonal. In order to make fertilizers available at the doorstep of the farmers, IFFCO has hired warehouse space of 8 lakh tones in about 1730 locations. The warehousing space is hired from cooperatives, CWC and SWC, of which share of cooperatives is about 66 percent. The average storage space turnover during the year 2007-08 was 10.6 as against 9.2 in 2006-07.
Sales
The sale of IFFCO fertilizers during the year 1999-2000 was only 51.72 lakh MT. It has increased to 81.95 lakh MT in 2005-06, 86.10 lakh MT in 2006-07 and to 93.24 lakh MT during 2007-08. But it reached its highest figure ever to 112.58. Urea sales during 2008-09 were 58.69 lakh MT as compared to 54.29 lakh MT during 2007-08. NPK/DAP sales during 2008-09 was 53.89 lakh MT as against 38.94 lakh MT in 2007-08.
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Marketing Productivity
The ‘Marketing Productivity’ per employee in Marketing Division during 1999-2000 was 2688 MT per employee and it reached a level of 7397 MT per employee in 2008-09.
SUSTAINABLE AGRICULTURE
IFFCO has always been an advocate of balanced fertilization. The society believes that there is urgent need to replenish the depleted micronutrients and secondary nutrients. IFFCO has advocated a nutrient based subsidy system. IFFCO has thus focused its agricultural extension activities to educate the farmers on the concept of balanced fertilizer use for sustainable agriculture. Educational and promotional programs like field demonstrations, field days, farmers meeting, seed multiplication, village adoption, crop seminars and special campaigns including distribution of CIP kits by our field staff are proving very effective in transfer of technology.
FARMERS SERVICE CENTERS
THE Society has also pressed into service 158 Farmers Service Centers spread across the country. These centers act as a one stop shop for farmers in order to provide technical guidance and make available all vital agro-inputs especially for small and marginal Farmers.
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IMPETUS TO COOPERATIVES
Strengthening nation’s cooperative fabric has been IFFCO’s principle forte. To further improve the economic viability of cooperative Societies, IFFCO has been developing some of adopted Societies as ‘IFFCO Franchisee’ by giving the business of rake handling, transportation and guidance to undertake educational and promotional activities. 329 cooperative Societies have taken up the activity of warehousing and 207 Societies have undertaken transportation of fertilizers from warehousing to their godowns and 34 Societies undertook rake handling and transportation of fertilizers. IFFCO has instituted a lecture series “Jawaharlal Nehru Memorial IFFCO Lecture” to revitalize and re-emphasizes the beliefs Pandit Jawaharlal Nehru in the Cooperative Philosophy. IFFCO organizes presentation of IFFCO “Sahakarita Ratan” and “Sahakarita Bandhu” Awards to honour and encourage eminent cooperators who have contributed towards strengthening the cooperative movement in the country.
IFFCO has established a charitable trust known as “IFFCO Kisan Trust” to provide relief and rehabilitation to victims in the event of natural calamities like floods, earthquakes, cyclones, landslides and droughts etc. IFFCO initially contributed Rs.10 crore and has been making contribution of Rs.1 crore every year. IFFCO employees also regularly contribute to this Trust. The Trust is undertaking programs ad projects aimed at improving the quality of life of farmers. The Trust is undertaking programs and projects aimed at improving the quality of life of farmers. The Trust organized mega medical camp, eye check-up camps for the farmers of Rajasthan, Uttar Pradesh and Punjab.
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IFFCO FOUNDATION
IFFCO laid the foundation of a ‘Think Tank’ ‘Brain Tank’ named “IFFCO Foundation” in January 2003. The main objective of the “IFFCO Foundation” is to focus on strengthening cooperative structure, developing social capital and human resources and promoting cultural development through cooperative organization, empowerment of women and youth, development of micro enterprise and micro credit concepts and pioneering reform and advancements in cooperatives. Foundation has been recognized as National Level Agency by Govt. of India for implementation of Horticulture Program through SHG/Cooperatives.
IFFCO EXCHANGE/COLLATERAL MANAGEMENT
To empower the farmers by providing them range of service, which includes price discovery, Price dissemination, Risk hedging and providing a national level trading platform. IFFCO stepped into the area of Commodity Exchange by acquiring 12 percent stake in National Commodities and Derivative Exchange (NCDEX) in 2004. The exchange offers contracts in 51 commodities which include 41 agriculture commodities, 2 energy, 6 metals and 2 bullion products. The exchange provides range of services which include Price Discovery and Price Dissemination.
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IFFCO along with seven other institutions co-promoted National Collateral Management Services Limited (NCMSL), which is the first national level collateral management company to be set up in India. On the agricultural side, NCMSL provides Procurement, Storage and Preservation, Quality testing and Certification, Collateral Management and information Services. It accredits were-houses, which meet the parameters for scientific storage.
IFFCO KISAN SANCHAR LIMITED (IKSL)
IFFCO launched a new subsidiary viz. ‘IFFCO Kisan Sanchar Ltd.’ (IKSL) with an aim to deploy Information Communication Technology to empower farmers in rural India and to strengthen the cooperative network in the country. IKSL will identify the needs of telecom & communication products and services which would add value to the life of farmer and retail them directly through the vast reach of cooperative societies.
IFFCO-TOKIO GENERAL INSURANCE COMPANY (ITGI)
Pursuant to IFFCO’s plans to diversify into areas other then fertilizers, which can be beneficial for Indian farmer IFFCO and TOKIO Marine and Fire Insurance Company Limited, Japan established a joint venture company known as IFFCO-TOKIO General Insurance Company Ltd (ITGI)
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for undertaking general insurance business in India. IFFCO and its associates have subscribed to 74% equity in share holding of ITGI Ltd. The company operates through 51 branches across the company.
IFFCO PLANTS
KALOL PLANT:
The Kalol Plant which went on commercial stream in 1975 comprises production units of Ammonium, Urea and Dry Ice along with necessary off-site facilities. Despite being one of the oldest plants in the country, the unit is still maintaining a fine performance level due to retrofits and revamps carried out from time to time.
The plant produced 5.60 lakh MT of urea with capacity utilization of 103% surpassing its previous record. The plant bagged First Prize in fertilizer sector for National Energy Conservation. The unit received Gujarat State Safety Award and the certificate of “Lowest Disability Index”
KANDLA PLANT:
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The Kandla unit, one of the oldest production outfits churned out 24.76 lakh MT of NPK/DAP, the highest quantity, during 2006-07 with a capacity utilization of 102.5%.
The unit has won FAI’s Awards for “Excellence in Safety” and “Golden Peacock Environment Management Award”. The unit is till holding good strength and is going well ahead in the production race of DAP across the country.
PHULPUR PLANT:
The Phulpur plants (unit 1 and 2) registered the highest ever annual production of 14.57 lakh MT of urea during the year with the capacity utilization of 103%. The plant received National Award for “Excellence in Water Management” and second prize in “National Energy Conversation” besides “Indira Gandhi Memorial National Award for Excellence” and “Best Pollution Control Implementation Gold Award”.
AONLA PLANT
Aonla 1&2 produced 17.70 lakh MT of urea with a capacity utilization of over 102.4%. The unit received second prize in fertilizer sector for the prestigious “National Energy Conservation Award” and National award for “Excellence in Energy Management”. The unit also won ICQESMS-2007 Excellence award for papers
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published on “Safety and Health in Chemical industry” and “Hazard Identification & Risk Management”
PARADEEP PLANT:
After necessary revamping and modifications the Paradeep Plant has started fertilizer production in April 2006. The plant could roll out 7.50 lakh MT of DAP/NP in 2006-07.
Chapter – 2
About the topic
“OVERALL MARKETING STRATEGY WITH SPECIAL
REFERENCE TO ITS
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DISTRIBUTION EFFECIENCY”
1.1 Description about the topic : The project topic is the study of “overall marketing strategy with special reference to its distribution efficiency”. Its main focus is to find out the effectiveness of overall marketing strategy in general and distribution strategy in particular in view of the distributors and consumers.
1.2 Reasons for the selection of the topic :
The main reason for selecting this topic was the company’s need to understand the efficacy of the relative policies and strategies of the company. This market research based review of the same would enable the company improve upon its marketing policies and strategies in future.
1.3Importance of the study to the organization :
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Now a day, every organization is quite aware of the fact that the success of their businessDepends on the level of customer satisfaction they are providing. But customers herein are directly served by the distributors, who in turn are fed by the producer. So if the Company’s distribution strategy is not proper and is unable to meet distributor’s needs properly in time to obtain their best of cooperation, consumer satisfaction can’t be enhanced. So is this study of distributor’s and consumer’s feelings and views about the company’s products and their marketability.
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CHAPTER – 3
RESEARCH OBJECTIVE &
SCOPE OF RESEARCH PROJECT
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PROBLEM DEFINATION
To find out whether fertilizers are being supplied in time insufficient quantity to the distributors.
To asses distributors cooperation level in term of stock maintenance.
To find out consumer’s awareness about IFFCO product and their selection preference.
In case they are not using IFFCO product, to find out the reasons.
OBJECTIVE OF THE RESEARCH REPORT
While making any research we should be very much clear for all the objectives of the proposed research for this there is a very simple test which can a person ask o himself before putting any objectives, he can think on if this result of this particular objective going to serve for the ultimate
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goal or not. If the answer is a simple yes, then only the objective should be considered worthwhile and worked upon.
In this particular case, our objective was to test the effectiveness of the Company’s distribution and promotional strategy and to find out the areas of relative strength and weakness. The ultimate purpose was to help the management understand the problem and take suitable measures to solve them.
SCOPE OF THE RESEARCH
For any research there is a workable area defined both for collection of data and for using the data for making decision. It is due to many constraints in our case the main constraint was time and at the same time the research could be conducted in a limited geographical area.
The research made by us was mainly being conducted in Patna as well as the method adopted was to go to various co-operative counters then verify the data given by them and in the manner data was collected on specific brand of respective product which are given in appendix attached then all the data was compiled in one format.
TIME SCOPE
Our project study was restricted to a time period of one and half month.
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CHAPTER – 4
RESEARCH METHODOLOGYAND LIMITATIONS
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METHODLOGY
SOURCE OF DATA
There are two sources of collecting data:1. Primary Source2. Secondary Source
The survey conducted has been limited to the franchisee at Bakhtiyarpur, Phulwarisharif, Bihta, Janipur, Danapur etc. data was collected b both primary and secondary sources.
Primary data was collected in the form of survey through the markets by asking some close and open ended questions which helped in analyzing the changing trends and its effect on already existing ones.
Our study is focused towards the co-operative due to the fact that IFFCO co-operative are good sources of estimating the market and collecting data.
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Secondary data was collected through the Internet and past data.
SAMPLE UNIT
The co-operative distributor, member and farmer’s in and around Patna.
TYPE OF SAMPLING
Simple random sampling
SIZE OF SAMPLING
Distributors – 20Member – 100
DATA COLLECTION INSTRUMENT
Survey chart, Questionnaire, Internet, Past Data.
RESEARCH LIMITATION
The study could suffer from the following limitation:
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1. Project is based upon data collected from Patna therefore result may not be generalized for whole of Bihar & India.
2. Correctness of survey is subjected to the correctness of the respondents.
3. This project was to be completed within a short span of time.
4. Study is based on a sample survey therefore it has some inherent shortcoming of a sample study.
5. Co-operative, member and farmer had some personal reasons for not responding to some of the questions.
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CHAPTER – 5
DATA ANALYSIS, INTERPRETATION&
PRESENTATION
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Data collection process was mainly based on two questionnaires – one for the cooperatives and the other for the farmers. Both the questionnaires are presented here under, before we go on to question wise analysis of the responses obtained.
Questionnaire for Co-operatives
Co-operative’s Name :
Address :
No. of members :
Consumption Area :
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Contact Person :
Contact No. :
1) Since how long has your organization been dealing with IFFCO?
2) Please rank all types of IFFCO fertilizers with respect to their market demand:
PRODUCT RANKING
a) NPK/DAPb) UREA
3) Do you get as much supply of IFFCO Fertilizers as you demand?
a) NPK/DAP Y/Nb) UREA Y/N
4) How is the timing of fertilizers supply?
PRODUCT TIMING
a) NPK/DAP Before time/ On time/ After timeb) UREA Before time/ On time/ After time
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5) Do you maintain sufficient stock of fertilizers as and when demanded by the market?
YES/NO If No, then why
6) In your view what is the status of the quality of IFFCO fertilizers as compared to other competing brands in the market?
PRODUCT QUALITY
a) NPK/DAP Better / Best / Lesserb) UREA Better / Best / Lesser
7) Please give some advice, if any which may promote the IFFCO business.
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Questionnaire for Farmers
Name :
Address :
Farming Area :
1) Do you know about IFFCO Fertilizers?
YES / NO
2) If yes, what types of fertilizers are produced by IFFCO?
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a) NPK/DAP Y/N b) UREA Y/N
3) What brands of fertilizers do you generally use?
IFFCO / Other / Both
4) If other or both, then why? a) IFFCO Dealer is too far Applicable / Not Applicable
b) IFFCO prices are higher Applicable / Not Applicable
c) IFFCO quality is inferior Applicable / Not Applicable
d) IFFCO fertilizers are not timely available in the market Applicable / Not Applicable
e) IFFCO Fertilizers quality Applicable / Not Applicable
f) None of the above
5) Please compare all types of IFFCO fertilizers quality with other brands available in the
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Market.
PRODUCT QUALITY
a) NPK/DAP Better / Same / Worseb) UREA Better / Same / Worse
6) Please give some advice for promoting the use of IFFCO fertilizer.
INTERPRETATION
According to the survey conducted on the Co-operatives we may come to the following conclusions:
1. The demand for IFFCO’s Urea is more than its NPK/DAP. As 95% of the Co-operatives surveyed consented on this.
2. The supply of the Fertilizer matches the demand with very few exceptions.
3. The timing of the fertilizer’s supply is satisfactory.
4. The Co-operatives are usually keen to keep their stock up to the level of demand in the market.
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5. Quality wise the products are same with that of closet competitors.
According to the survey conducted on the Farmers we may come to the following conclusions:
1. All the farmers interviewed had heard about the IFFCO Fertilizers.
2. 80% of the Farmers said they used IFFCO’s Fertilizer.
3. Quality wise the products are same with that of closet competitors.
BIBLIOGRAPHY
S.No. Authors Name Books Name1 Beri, G.C. Marketing Research
