(Pondicherry University - Mahesh Sherkhane - Project Guide - Dr R.Rajeshwari ---
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DISTRIBUTION CHANNEL NETWORK OF PARLE-G
Manufacturing Unit of
Parle- G at various Locations
Parle- G Depots
Wholesalers and
Distributors
Transportation to next level
Retailers: Small shop / City
stores
Procurement: Customers7
Distribution channel of Parle
Intensive distribution: Parle uses, Intensive Distribution for Parle G. This is the ideal
strategy for the market leader as intensive distribution has the following advantages;
Increases coverage and sales.
Increases product availability
Encourages retailers to compete aggressive. Higher competition leads to narrower
margins for the retails hence, increases the ultimate margin for the manufacturer.
Channel members of the distribution network: The Parle distribution network for
biscuits has essentially four levels as enlisted below:
Parle Depots
Wholesalers and Distributers
Carry Forward Agents (if required)
Retailers
Channel members and logistics Parle has nearly 1500 wholesalers, catering to
425000 retail outlets directly or indirectly. A two hundred strong dedicated field force
services these wholesalers and retailers. Additionally, there are 31 depots and Carry
and Forward agents supplying goods to the wide distribution network. Parle has level
1, level 2, level 3 distribution channels levels.
LEVEL 1
LEVEL 2
LEVEL 3
Availability at all
departmental stores across
the length and breadth of the
country.
Channel exists for customers
scattered throughout the
country.
Mass consumption and
suitable for National and
International coverage.
Channel Dynamics: Parle has a multi-channel marketing system since it uses more
than two marketing channels to reach all its customer segments.8
Distribution channel of Parle
5. PARLE DISTRIBUTION NETWORK LOGISTICS
Selection of Channel Members: Parle takes into consideration a host of factors while
selecting the channel members. This is because it believes that selection of channel
members is a long run decision and the rest of the decision regarding the supply chain
depends upon the efficiency and coverage by the channel members.
The following are the host of factors considered by the company in selecting the channel
members:
Authentication is required by the regarding the identity of the channel members,
which includes the name and address, photograph of the location.
Proof of solvency which requires name and address of the channel member’s bankers
Safety of the inventory, which means that the distributor/ dealer should get the stock
of the company insured.
Inventory or the perishable goods kept by the distributor/ dealer should be in good
condition which means a detail of storage space and Refrigeration facility is to be
provided.
Details of the delivery vehicle, which includes the following.
Light Commercial Vehicles:
Matador
3 Wheeler Van,
Tricycle Van and Hand/Push cart.
The number and model of each of the vehicle needs to be furnished to
the company.
Company acknowledges the fact that it needs to be sensitive to the market demands.
For this it requires that a number of salesmen needs to be present on the field.
The salesmen too are divided into various categories like,
The Field salesmen
Counter salesmen9
Distribution channel of Parle
The details of Clerical Staff and labour are to be provided. The technical competence
of the salesmen needs to be mentioned.
Details of the various products of other companies that the channel member keeps
have to be provided. The following also need to be furnished with the above:
The annual sales of these products have to be mentioned.
Details of complementary products and product lines need to be
mentioned.
Dealers of the company must carry a good reputation. This is due to the fact that Parle
believes that the reputation of the dealer affects the clientele in the long run.
Market coverage by the distributors needs to be defined which includes details of
Geographic coverage and Outlets per market area.
The company also requires the dealers to furnish any Advertising and Sales initiative
undertaken by them on behalf of the company.
Channel Members Of The Parle Distribution Network :
a. The Distributors:
One of the main factors, which keep the distributors motivated, is the margin. Usually
the margins offered by Parle are 8%. Now-a-days it has been raised to 8.5%.
Volume wise this comes out to be a big figure since Parle’s product has a good
demand in the market. However compared to the other companies the margins are still
lower since the new players in the market offer a much higher margin. But the very
fact that Parle’s products have good demand in the market motivates the distributors
to stock it.
Parle Products being a cooperative cannot afford to give heavy monetary incentives.
Parle”s products are considered to be value for money since the company does not
believe in charging high margins. In fact all monetary incentives are just the short run
means to promote thecompany’s product.10
Distribution channel of Parle
b. The Retailers:
Trade schemes: these are undertaken by the company only for the hard selling items
Glow boards: the company puts up glow boards at the retailer and pays the major
portion of the cost.
Schedule of the salesmen: they provide the retails with this schedule so the retailers can pre
-estimate the quantities of the various products needed.
Infrastructure facilitation: the company facilitates the retailers to buy beautiful stalls by
formulating an easy payment program and a commitment to buy back the equipment
at a reasonable price when the value of the equipment has depreciated.
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