Saturday, July 30, 2011

Guest Lecture by Mr. Hemant Malik

SIMSREE was honoured to welcome Mr. Hemant Malik, COO- Trade Marketing and Distribution, ITC Limited on campus. Mr. Malik took a guest lecture with the students in which he covered the basics of marketing and distribution. Mr. Malik started out by asking students why people buy particular products, what is the meaning of brand loyalty, and how availability of products affects loyalty.

Using ITC’s operations as an example, Mr. Malik explained various concepts including the problems faced by an FMCG major. Some of the problems Mr. Malik spoke about were getting the products on time to different kinds of stores, including convenience stores which would not have much storage space. The main problem is managing the inventories of various kinds of stores, each having different storage and display formats. Customers prefer buying the freshest possible goods. In fact, some even switch brands if they do not find a fresh product of their brand of choice.

Mr. Malik also spoke about logistical difficulties like ensuring efficient transportation of goods. The example given was that of wheat flour and Bingo chips. According to regulations, each truck can carry only 9 tonnes of goods. With wheat flour, 9 tonnes would only occupy half the space (in terms of volume) in the truck resulting in wastage of space. However with Bingo chips, only 1 tonne (in weight) would occupy the entire space (in terms of volume) in the truck. So the solution the company came up with was to carry 8 tonnes of wheat and fill the remaining space with 1 tonne of chips, hence making optimum use of space as well as meeting regulations.

Mr. Malik also spoke about various issues that companies have to watch out for including making sure that their products are placed in a visible place in stores. Convincing stores to carry the products also requires serious effort in the case of big stores, because such stores are more interested in increasing category sales rather than the sales of simply individual products. So in order to convince them one has to resort to measures such as negotiating margins. Also one has to manage warehouses which are used for storage to ensure that products move in a first in first out manner. In stores too, older goods have to be placed in front of newer ones otherwise customers would buy the newer ones and the older ones would never be sold and would eventually have to be discarded.

It was a very informative session for all the students present as we got to hear firsthand how a major company like ITC manages its trade marketing and operations. We hope to have many more sessions with Mr. Malik in future.


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