INDIAN DISTRIBUTORS LTD.

GROUP MEMBERSANKITA SHAHAAKANKSHA GUPTANEHA DESHMUKHSHIVANI TIWARIRAVI CHAVDA

Originally started as a small trader who used to import goods from third world countries and sell these in India. Slowly it expanded its business to an “importing house’.

Established about fifty years back.

Its headquarters are in Mumbai but it has warehouse and regional sales offices in Delhi, Calcutta, Chennai, Jaipur, Lucknow and Amritsar. Over and above the regional sales offices, it also has regional sales centers in all the major towns of all states of India.

The existence of a strong distribution and selling network enabled them to take a distributorship of a wide range of Indian manufacturers.

Over a period of time, it also started marketing products of smaller manufactures under its brand name ‘XEON’. The variety and the range of products is also wide, that on an item to item basis, the number will be over 10,000 items.

They sell

50% indigenousmanufactured

products

50% products imported

from other countries

(Involve license formalities)

Indian Distributors Ltd decided to create the following products divisions:

White Goods Division Electrical Engineering Division Electronics Division Apparel & Footwear Division Food & Confectionary Division

Role of the White Goods Division, Electrical Engineering Division, Electronics Division

Complete solution to its customers they are to provide guidance to the customer do necessary installation and may sometimes take orders for

customized products

the cosmetics, apparel & footwear and food & confectionary Sales in these three divisions are made for stock

and the invoice is generated and dispatched latest by next day. The warehouse stocking policy of these divisions considers the demand of the market it covers. The stocking levels are decided based on the demand and lead time of supply.

The distribution system followed by Indian Distributors Ltd is as follows:

Each city is divided into sales regions and is assigned to traveling salesmen.

Indian Distributors Ltd has coded the complete details of each store / shop on various routes within each city. These details includes the name of the store / shop, its address, turnover, locality, population statistics of the area in which the said store / shop is situated, the income group, etc.

Each salesman is assigned to a particular predefined route and complete details of each store / shop on that route are handed over to the salesmen. He is provided with a van to carry the stocks for delivery to the shops on his route for previous orders and also to collect new orders. He is expected to visit each shop at least once a week to fulfill pending orders and to collect new orders. All items marketed by the company have also been coded into the product database with information on price, size, weight, variety, brand name and manufacturer, etc.

product

80%- normal product(standard price list)

Quotation- head office

regional sales staff

20%- customized product

The standard price- head office

regional offices.

Order Processing Software

Continued..

Data capture by the system Division Region Code Salesmen details Distributorship Product Details Invoice Value Cost Gross Profit

Data capture by the issue slip Shop Code Shop Name Order No Route No Issue Slip No Product Details Ordered Quantity Issued Quantity Amount Date

Optimal Space/Shelf utilization

The loyalty and repeat visit of the customers depend on availability of the products and the services being provided by the shopkeeper.

The shopkeeper needs to optimally utilize the space in the shop and also needs to stock complete variety of products.

The empty shelf space means a loss of revenue for the shopkeeper and loss of business for Indian Distributors Ltd.

Data Analysis using the system

Division wise sales analysis Distributor wise sales analysis Region wise sales analysis Product wise sales analysis Salesmen wise sales analysis Some level of forecasting is possible.

Its based on the current data only. Manager can also compare the actual performance with the forecasted sales.

Types of Costs

Annual Budgeting Procedure Prepared at regional sales managers’,

divisional managers’ and head office level

Monthly expenses statement -> Expense control statements.

Profit & Loss statements prepared at the individual level.

These statements consolidated at the head office to produce the final profit & loss statement.

Fault in the system

20% of orders are partially delivered. The order processing system does

not have the provision of monitoring the partially fulfilled orders.

Leads to loss of sales. Every time a fresh order is booked,

old orders are not referred back to.

Challenges faced by the company

Product selection Inventory management Customer satisfaction Transportation Logistics

Question 1

Identify the key decision managers in the organization.

Question 2

Evaluate the systems to find whether these key managers get the right

kind of information to support their decision? If not then suggest what information each manager would

need to function effectively.

Evaluation of the order processing system

No provision for monitoring partially fulfilled orders. System aids only in doing some limited amount of

sales analysis. No facility to compare past trends and the future

trends. Forecasting is done on the basis of the current data

only, past trends are not taken into consideration Since the data for a long period of time is not

available different types of analysis are not possible.

Eg: Time series analysis

Question 3

Depending on the information needs of the company, identify the main modules (components) of the

information systems.

Modules of the information system Real time processing Strong database containing past,

present data records. Updation of raw materials availability

and issued Integrated support with other

departments. Modular and open architecture Problems faced or queries

Old Distribution process

Each city is divided into sales regions and is assigned to traveling salesmen.

The complete details of each store is coded with details such as the name of the store its address, turnover, locality.

Each salesman is assigned to a particular predefined route with complete details of each store on that route

A van for delivery and collecting new orders is provided.

He is expected to visit each shop at least once a week to fulfill pending orders and to collect new orders.

All items information is integrated into the product database.

Invoices were often delayed.

Accounts department for further processing

Current Order Fulfillment System

Data processing by Ops

The orders are collected in standard format by salesman.

Menu driven order processing software (captures the orders and invoice details)

Allocates the stock to the orders received

Duplicate issue slip is printed

Store Van

Container delivered as per the issue slip

Issue slip is returned signed duly by the shop owner with cash or cheque

Head Office

Stock Availabilit

y

Shop

EndNo

Yes

Slip 1 Slip 2

Delivery

Cash Cheque

Store

Merits Of Order processing software

Standardized Process System updates the inventory Sales proceeds are closed timely Data analysis is better One database for all kinds of

information

Current techonology

EDI(electronic data interchange) Electronic data interchange

(EDI) is the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents or business data from one computer system to another computer system, i.e. from one trading partner to another trading partner without human intervention.

EDI and its advantage

EDI via internet:webEDI enables small to medium-sized businesses to receive, turn around, create and manage electronic documents using just a web browser.

eg:-Many companies around the world have shifted production of labour intensive parts to low-cost, emerging regions such as Brazil, Russia, India, China, and Eastern Europe. Web-based EDI, or webEDI, allows a company to interact with its suppliers in these regions.

EDI over paper system

Reduces great deal of human interaction

Reduces cost of handling,distributing and sorting of the data

Reduces errors Improves speed etc

RFID(RADIO FREQUENCY IDENTIFICATION)

Radio-frequency identification (RFID) is the use of an object mainly tags applied to or incorporated into a product, animal, or person for the purpose of identification and tracking using radio waves.

Challenges

Ordering procedure is faulty:-when fresh orders are booked ,old orders are not referred back.

Cost are known at the time of invoicing and customization quotes are provided by the workshop in mumbai.

P&l statements are prepared at the individual basis.

Mains issues

Product selection Inventory management Customer satisfaction Transport and logistics Etc

Implementation of EDI and RFID

EDI can be used for inbound and outbound data processing.

EDI performs all the role from withdrawal,delivery and billing.

RFID helps in tracking of product. RFID helps in monitoring partially

fulfilled orders. Comparison with the past data.

ERP

Enterprise Resource Planning is an integrated computer-based system used to manage internal and external resources, including tangible assets, financial resources, materials, and human resources. Its purpose is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders.

Advantages of ERP

ERP systems typically handle the manufacturing, logistics, distribution, inventory, shipping, invoicing, and accounting for a company.

It will address all the issues of indian distributors ltd by clubing of all the information of different dept in a database.