PREFACE

The project report contains material collected from the study on “Distribution Channel” in J.K

Tyres Ltd, Guwhati, as a part of the course curriculum of 3dr BBA; NEHU.

As regards to the subject, it can be said that; marketing is an essential element for the proper

functioning of the different companies. Without marketing the vital communications between

the manufacturer sand the consumers does not exists. And thus the term marketing

management is the process of planning and executing the conception, pricing, promotion and

distribution of ideas, goods, and services to create exchanges that satisfy individual and

organizational goals.

Now, as regards to the topic, it can be said that distribution channels are sets of interdependent

organizations involved in the process of making a product or service available for use or

consumption.

ACKNOWLEDGEMENT

The project work done by me was not entirely out of my own effort, but also the co-operation

of many useful hands. The work would not have been made possible and so systematic if the

helpful hands would not joined hands with me to conduct the meritious outcome of the

survey.

First of all, I would like to thank the Almighty because nothing could have been possible

without his blessings and divinity.

Next, am very much indebted to our Principal Father V.A Cyraic, my teachers Sir Sanjeev

Hazarika(HOD) Department of Business Administration, Sir Bilrak k Marak. Sir Sendrik A

Sangma and Sir Paul Hrangkhawl for their help and support.

Thirdly, I would like to thank my friends and family members for their constant help in

conducting my project work. Also I would like to acknowledge my thanks to the ex-senior

students whose projects were of great help in preparation of my project

Last but not the least; I would like to thank Mr. Debarikhav Phukan, the sales and service

engineer (truck Radial) for helping me to out in giving the relevant details of the required

topic and thus helping me to prepare my project report efficiently.

Thus, I acknowledge my thanks to all of them, without whom I would have not been able to

carry out my project preparations so successfully.

SWARNIMA TIWARI

CHAPTERS

1. EXECUTIVE SUMMERY

1.1 Introduction

1.2 Importance of the subject

1.3 Reasons for selecting the topic

1.4 Reasons for selecting the company

2. COMPANY PROFILE

2.1 Introduction

2.2 Core values of the organization

2.3 Introduction to the company

2.4 General Information

2.5 Their Plants

2.6 Their vision and Mission

2.7 Organizational Chart

3. HISTORY OF TYRES

3.1 General Information

3.2 Tyre Technology

4. DISTRIBUTION DEPARTMENT OF THE COMPANY

4.1 General Introduction to the department

4.2 Functions of the Department

4.3 Organizational setup

4.4 Pictures of the C&F

5. TOPIC THEORY

5.1 Introduction to the topic

5.2 Characteristics of distribution channel

5.3 Role and Importance of distribution channel

5.4 Functions of distribution channel

5.5 Types or classification of distribution channel

5.6 Major types of intermediaries in distribution channel

5.7 Types of channels in distribution channel

5.8 Factors governing the choice of an intermediary

5.9 The channel policy and strategies

5.10 Some other dimensions of channel management

Page No.

1-2

3-8

9-12

13-14

15-26

6. DISTRIBUTION OF J.K TYRES LTD

5.10 Distribution pattern Of J.K tyres Ltd

5.11 Map showing J.K tyres operation in India

5.12 Their operation in North-East India

6. RESEARCH OBJECTIVE AND METHODOLOGY

6.1 Research objectives

6.2 Research methodology

7. METHODS OF DATA COLLECTION

7.1 Introduction

7.2 Methods of data collection

8. GRAPHICAL REPRESENTATION OF DATA

9. LIMITATIONS

10. CONCLUSION

11. ANNEXURES

12. QUESTIONNAIRE

13. BIBLIOGRAPHY

1. EXECUTIVE SUMMERY

1.1: INTRODUCTION: Marketing Management usually represents all managerial efforts and

functions to operate the marketing concept not only in letters, but also in sprit. It is a concept,

combining the various elements of Marketing and Management.

In the “Marketing concept”, it usually demands customer-oriented marketing plans, programs and

policies so that the market can assure perfect positive correlation between the supply and customers

desires and expectations.

In the “Management concept”, it usually deals in the management cycle of planning, effective

implementation, evaluation and control, feedback and re-planning.

Thus combining the two concepts of Marketing and Management, we get the full concept of the term

Marketing Management, which represents a vital functional area of Business Management efforts for

the flow of goods and services from the producer to the consumers. It has to implement the marketing

strategies, promotions and campaigns. Finally, it must evaluate the effectiveness of each part of

marketing mix and introduce vital modifications to remove discrepancies in the actual execution of

plans, policies, strategies, procedures and programs. The survival and growth of any business depends

upon the profitability, when marketing management becomes a good practitioner of the marketing

concept.

Thus, Marketing Management is an ongoing process dynamic marketing environment. It is the

analysis, planning, implementation, and control of programs designed to creates build and maintain

beneficial exchanges with target buyers for the purpose of achieving organizational objectives. Thus,

Marketing Management involves managing demand which in turn involves managing customer’s

relationship.

1.2 IMPORTANTANCE OF THE SUBJECT: After a brief introduction of the subject, it can be

said that marketing is an ongoing process, comprising of:

Discovering and translating consumer needs and desires into products.

Creating demands for the products and services through promotion and pricing.

Serving the consumer demand through planned physical distribution.

Expanding the market even in the face of keen competition.

Thus, the given important aspects of “Marketing Management” are important tool for

all its major functioning. Without it the process of marketing is not possible and it does not lead to

efficient management in the company. Thus for a company it is very vital to efficiently use all its

resources in meeting the demands of the consumers and also earning a high profit turnover.

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1.3: REASONS FOR SELECTING THE TOPIC: The following are the reasons as to why,

the given topic namely “Distribution Channel” was chosen by me.

1. To know the types of distribution channels in the organization.

2. To know the functioning of the various distribution channels

3. To know that how they act as intermediary between the producer and the consumers.

4. To know that whether they are able to supply the goods to the consumers’ in time or not.

1.4: REASONS FOR SELECTING THE COMPANY: The following are the reasons as to

why J.k Tyres Ltd was Chosen by me.

1. The company is a well known one and has goodwill in the national and international market

also.

2. To know about the operation and distribution pattern of J.K Tyres in North East.

3. To know the market share of J.K. Tyres in Northern Market.

Thus, these were the reasons for selecting the company to carry out the project.

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2. COMPANY PROFILE

2.1: INTRODUCTION TO THE ORGANIZATION: J.K organization owes its name to

late Juggilal Singhania, a dynamic perrsonality with a broad vision. Inspoerd by the cause of

the Swadeshi movement of Mathama Gandhi, and driven by the zeal to set up an Indian

enterprise, Lala Kamlatath Singhania Founded J.K Organization in the 19 th century ushering

in a new industrial era in India.

The process of Industrialzation and diversification was worthily and successfully carried on

by Lala Kamlapath and three illustrious sons-sir padampat, Lala Kailashpat and lala

lakshmipat, aided in no small measure by the late Gopal Krishna son of Sir Padampat.

The advent of JK Organization on the industrial landscape of India almost synchronizes with

the beginning of an era of industrial awareness - an endeavor for self reliance and the setting up of a dynamic Indian industry. This was way back in the middle of the 19th century. And

the rest that followed is history.

2.2: CORE VALUES OF THE ORGNIZATION:

JK Organization has been a forerunner in the economic and

social advancement of India. It always aimed at creating job opportunities for a multitude of countrymen and to provide high quality products. It has striven to make India self reliant by

pioneering the production of a number of industrial and consumer products, by adopting the latest technology as well as

developing its own know-how. It has also undertaken industrial ventures in several other countries.

JK Organization is an association of industrial and commercial companies and charitable trusts. Its member companies,

employing nearly 50,000 persons are engaged in the manufacture of a variety of products and in diverse fields of commerce.

Trusts are devoted to promoting industrial, technical and medical research, education, religious values and providing better living and recreational facilities.

With the spirit of social consciousness uppermost in mind, J.K. Organization is committed to the cause of human advancement.

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2.3: INTRODUCTION TO THE COMPANY:J.K Tyre & Industries Ltd is the

flagshipcompany under the umbrella of J.K organization.It has been established in 1977 by

late Jugilal and Kamlapath Singhania. Jk Tyre and Industries is a mega corporate entity that is

emblematic of excellence, diversification and pioneering new technologies. A part of JK

Organization which ranks among the top private groups private groups in India, J.k Tyre and

Industries is committed to self reliance and follows an ethic that views customer satisfaction

as an index of achievement.

Over the years, the company has expanded and diversified its business portfolio. It has

developed into a multi product, multi-location corporate entity comprising of number of

business divisions.

2.4: GENERAL INFORMATION:

Ever since its inception it has been JK Tyre's belief in the value of technological superiority

that has made it grow by leaps and bounds. This division produces and sells tyres and tubes

under the brand name "JK Tyre" for Truck, Buses,

Passenger Cars, Jeeps, Light Commercial

Vehicles, Multi Utility Vehicles and Tractors.

The company pioneered Steel Radial Technology

in India in 1977 and continues to be the industry

leader in the Radial segment in India. JK Tyre is

the only Tyre Manufacturer in the country to

produce high performance 'T' & 'H' -rated steel

radial tyres.

JK Tyre has consciously followed a policy of

continuously modernizing and expanding its tyre

manufacturing facilities to retain its edge in the

market place.

Our customer base covers virtually the entire Original Equipment Manufacturers (OEMs) in

India together with Replacement Market for four wheeler vehicles, Defense and State

Transport Units. Besides India, we have a worldwide customer base in over 45 countries

across all 6 continents.

To keep pace with the market demand as well as technological leadership in Indian market,

J.K. Industries acquired Vibrant Tyres Limited, Mysore in 1997. J.K. Industries and Vibrant

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Tyres Limited are the only tyre companies in India to have received all three ISO 9001, QS

9000 and ISO 14001 certificates. This indeed is a true reflection of our commitment to system

oriented approach. The company has a technical collaboration with M/s Continental AG,

Germany, which is among the top five tyre manufacturers in the world to keep pace with latest

technological developments. To stay at the forefront of technological advancements a state of

art Research & Development Centre, HASETRI, was set up, which remains the nerve centre

for providing cutting edge technology. In a short span of time it has emerged as the 17th

largest tyre manufacturer in the world an achievement in itself.

JK Tyre is a leading radial manufacturer and the first in the world to be awarded the

OS 9000 for multi- location operation. It is also the first tyre manufacturer in the world to get

the ISO 9001 certification for its entire operation.

JK Tyre has consciously followed a policy of continuously modernizing its tyre

manufacturing facilities to retain its edge in the market place.

Also, JK Tyre is the largest exported tyre brand from India. It was awarded the

CAPEXIL’s Highest Exported award for 1997-98 by FIEO. It enjoys prefer premium brand

status in truck Bias market in USA and across many markets in Africa, Middle East and South

East Asia.

Ever since its inception it has been JK Tyre's belief in the value of technological

superiority that has made it grow by leaps and bounds. This division produces and sells tyres

and tubes under the brand name "JK Tyre" for

Truck, Buses, Passenger Cars, Jeeps, Light

Commercial Vehicles, Multi Utility Vehicles and

Tractors.

The company pioneered Steel Radial Technology

in India in 1977 and continues to be the industry

leader in the Radial segment in India. JK Tyre is

the only Tyre Manufacturer in the country to

produce high performance 'T' & 'H' -rated steel

radial tyres.

JK Tyre has consciously followed a policy of

continuously modernizing and expanding its tyre

manufacturing facilities to retain its edge in the

marketplace.

5

Our customer base covers virtually the entire Original Equipment Manufacturers (OEMs) in

India together with Replacement Market for four wheeler vehicles, Defence and State

Transport Units. Besides India, we have a worldwide customer base in over 45 countries

across all 6 continents.

To keep pace with the market demand as well as technological leadership in Indian market,

J.K. Industries acquired Vikrant Tyres Limited, Mysore in 1997. J.K. Industries and Vikrant

Tyres Limited are the only tyre companies in India to

have received all three ISO 9001, QS 9000 and ISO

14001 certificates. This indeed is a true reflection of

our commitment to system oriented approach. The

company has a technical collaboration with M/s Continental AG, Germany, which is among

the top five tyre manufacturers in the world to keep pace with latest technological

developments. To stay at the forefront of technological advancements a state of art Research

& Development Centre, HASETRI, was set up, which remains the nerve centre for providing

cutting edge technology. In a short span of time it has emerged as the 17th largest tyre

manufacturer in the world an achievement in itself.

2.4Their plants:

With three plants located in Rajasthan,

Madhya Pradesh and Karnataka, JK Tyre is

the largest manufacturer of truck and bus tyres

in India. The truck and bus tyres produced

account for nearly 74% of the total tyre

business in India, thus giving JK Tyre an

undisputed position. Additionally, JK Tyre is

the only manufacturer of truck/ bus steel radial

tyres, and the second largest manufacturer of

4-wheeler tyres in the country.

Also, JK Tyre is the largest exported tyre

brand from India. It was awarded the CAPEXIL's Highest Export Award for 1997-97 by

FIEO. It enjoys preferred premium brand status in Truck Bias market in USA and across

many markets in Africa, Middle East and South.

6

2.7 JK TYRE VISION AND MISSION:

JK TYRE VISION:

JK TYRE MISSION:

7

2.8 ORGANISATIONAL CHART

ORGANISATIONAL CHART OF JK TYRE INDUSTRIES, GUWAHATI :

8

Area Manager

Service

Engineer

Sales

Officer (1)

Sales

Officer (1)

Sales

Officer (1))

Sales

Officer (1)

Sales

Officer (1)

(Commercial Staff)

3. HISTORY OF TYRES

3.1 THE HISTORY OF THE TYRE:

The following chronicles the development of the tyre as we know it today. RW Thomson invented and patented the Pneumatic Tyre in 1845. His first design used a number of thin inflated tubes inside a leather cover (illustrated). This design actually had its advantages over later designs. It would take more than one puncture to deflate the whole tyre, and varying the pressures could alter the ride conditions.

It was not until the late nineteenth century, 1888, that John Boyd Dunlop invented the Rubber Pneumatic Tyre. Despite

these technological breakthroughs the solid rubber tyre continued to be the dominant tyre and it was not until 1889 that the pneumatic tyre caught on.

Dunlop first advertised his tyres in December 1888 in the Irish Cyclist, and in May of the following year the Tyre had its first breakthrough. A Belfast Cycle Race was won on pneumatic rubber tyres, and by now the public were starting to take note.

Unfortunately the original tyre had its drawbacks. The inner tube was difficult to get at because the tyre was stuck to the wheel. In 1890 CK Welsh patented the design of a wheel rim and outer cover with inextensible lip. By now we had the basics for today’s tyre. Over the years the tyre has developed into today’s high technology offerings. Two of the most important technical developments include Michelin’s creation of the radial tyre with its vastly superior grip in 1948, and when Dunlop did away with the inner tube on car tyres in 1972.

Time has given the motor industry tyres capable of many different applications. This ranges from High Speed Racing such as Formula One to Heavy Plant Usage on vehicles as large as a house. All tyres deliver a comfortable ride, relative puncture resistance, wear and performance. The importance of a tyre must not be taken for granted. After all a tyre is your vehicles only point of contact with the road.

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3.2 TYRE TECHNOLOGY:

RUN FLAT TYRE:

Several Tyre Manufacturers have developed tyres, and tyre systems that allow a vehicle to continue moving despite a loss of pressure. There are two different approaches:

1. Reinforce tyre sidewall manufacturer of thi8s include: Bridgestone, Continental, Goodyear, Dunlop, and Pirelli.

2. Rubber clip to your rim manufacturers of this include Michelin. All Run flat technology must operate in tandem with tyre pressure warning systems.

1. Reinforced Tyre Sidewall:

The Diagram below shows The Dunlop DSST system for run flat. These tyres can be placed on any rim. The sidewall is reinforced allowing the tyre to support the vehicles weight. The tyre is constructed with new rubber compounds that prevent tyre destruction with excessive flexing. Run Flat Tyres allow a vehicle with complete loss of tyre pressure to handle effectively. Braking, acceleration, and steering behaviour remain unchanged. Mobility is maintained even after a puncture, but you must refer to each individual tyre’s guidelines from the Manufacturer.

Dunlop DSST Tyre Tyres that carry this technology include the Bridgestone RFT series, Continental SSR series Dunlop DSST series, Goodyear ROF series, and the Pirelli Euphori@ series.

2. Rubber Clip to your tyre rim:

The rubber clip prevents the tyre rim cutting into your tyre when you experience a loss of pressure. This system has been developed by Michelin and is known as the PAX System. Like the reinforced sidewall it operates in tandem with automated tyre pressure monitors.

Why fill my tyres with Nitrogen? Why would you want to do this? The benefits of Nitrogen filling are as follows:

Improved comfort of ride Improved safety Increased fuel savings Improved life of tyre

Nitrogen has long been the accepted gas medium for filling aircraft tyres, racing tyres and heavy mining and construction vehicle tyres. Nitrogen is used for safety reasons and to ensure that tyres are always at a constant pressure. Compressed air, the traditional medium for inflating car tyres, contains both oxygen (21%) and nitrogen (78%). The rubber tyre is like a membrane, through which oxygen permeates three times faster than the nitrogen. The result is that the oxygen slowly leaks out through the rubber walls, and the under-inflation leads to higher tyre wear with a consequent decrease in safety and comfort, and higher fuel costs.

Truck & Bus:

Bridgestone is one of the first tyre manufacturers to prepare itself for the latest demands in the Truck & Bus industry with the latest technology.

We are proud to present our brand new state-of -the-art BSelect Tyre Centre & SA State Office located at Wingfield, SA. This Tyre Centre is Bridgestone Australia's largest Truck & Bus Service Centre. With 8 truck bays, having B-Triple capabilities, servicing any vehicle configuration is not an issue. A truck driver's lounge with shower facilities also allows you to get that necessary break & opportunity to freshen up whilst we carry out the work on your vehicle. Also the service centre has 3 passenger car bays and 1 passenger car wheel alignment bay with a separate entrance to round out all servicing needs.

New Truck & Bus Tyres:

Bridgestone strongly supports the modern transport operator with cost-efficient, hi-tech solutions to the increasing demands of road transport not only today but in the future. Refer to Truck Tyre specifications for details.

Featured Tyre:

Introducing the new Bridgestone R150II As part of Bridgestone's philosophy of continuous improvement Australia’s most popular line-haul steer tyre, the R150, has been revised for improved performance. Building on the ground breaking performance and market leading popularity of the R150 (see results of Bridgestone's 2004 TBR in the brochure) the R150 II delivers greater mileage and superior irregular wear resistance.

R150II Specifications Brochure R150 Specifications Brochure Bridgestone Select Truck Centre

Wingfield S.A.

4.DISTRIBUTION DEPARTMENT OF THE COMPANY

4.1: General Introduction to the department: Placing of goods and services where they are

needed and when they are wanted is very important function of the distribution department of

the company. The distribution department of the company has to perform all the functions

related to the distribution of their products i.e tyres and how toto serve their customers in the

best possible ways. The distribution department of the company focusses on the customers

needs and tries its level best to provide services to the customers as early as possible. The

distribution department of the company consists of Didtrict manager, sub-district

managers,service engineers for different segments of tyres, and operational staffs. They all

work together and in coordination to satisfy their dealers and provide them with best service.

4.2 Functions of the Department:

1. Match assortments and quantities of goods designed by customers with these available

for distribution.

2. Promote the products they carry through catalogues trade shows and advertising.

3. Conduct research on markets to locate and determine the requirement of potential

customers.

4. Sell the products through personal presentation

5. Physically distribute the product through sorting and transporting it.

6. Serve products and advice on their use as required.

4.3 Organizational set up.

DISTRICT MANAGER

SUB DISTRICT MANAGER

SERVICE ENGINEER

Operational Staff (8-10)

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4.4 Pictures of their C&F

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5. TOPIC THEORY

5.1 INTRODUCTION: The typical geographic separation of the manufacturer or producer

from the ultimate consumer requires some means for bridging the gap. The movement of

goods and services from the place of production through middlemen to the ultimate

consumers/users has been thought of as a channelized flow. At present most of the producers

sell their products to the consumer through a host of marketing intermediaries performing a

variety of functions-buy, take title to, resell, negotiate etc. producers produce the products and

finally make them ready for the market. The methods and routes to be adopted to bring the

products to the market-to the ultimate and industrial users must be determined. This involves

establishing distribution strategies, including channel of distribution and physical handling

and distribution.

Distribution decisions have a broad impact on the marketing program of a firm. The object of

the distribution strategy is to the right customer. A product cannot reach its target marketer if

its distribution is not planned and carried out carefully. Distribution channel decisions which

to most critical decisions which intimately affect all the other marketing function.

Distribution system had two components: (i) channels of distribution and (ii) physical

distribution. Channel of distribution. By channel of distribution we mean the intermediaries or

the consumers, including transportation, warehousing and inventory management. In simple

terms “Marketing Channel” or “channel of distribution” is a path traced in the direct or

indirect transfer of ownership to a product, as it moves from a producer to ultimate

consumer/industrial users.

Definitions:

1. In the words of Stern and El. Ansary “Marketing channels are sets of interdependent

organizations involved in the process of making a product or service available for use

or consumption.

2. According to Rachman, “Marketing channels are the path that products follow on their

way from producers to the consumers or industrial users”.

3. In the words of William Stanton, “a channel of distribution for a product is the route

taken by the title to the product as it moves from the producer to the ultimate

consumer or industrial user”.

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5.2 Characteristics:

1. A distribution channel requires at minimum a seller and a buyer. The buyer may be a

consumer or and industrial user.

2. It includes besides buyers and sellers, various middlemen.

3. The basic transaction in a distribution channel is the exchange of ownership, or title of

goods. Middlemen play an active role in the transfer of ownership.

4. The channel for a product extends only to the last person who buys it without making

any significant change in its form. When its form is altered and another product

emerges, a new channel is started (William Stanton).

5. One of the objectives of distribution channel is to create “transactional efficiency”.

5.3 Role and Importance:

A channel of distribution plays an important role in the marketing of goods and services

because the ultimate goal of all marketing activities is to effectuate the transfer of ownership

of goods to customers. The importance of distribution channel can be explained under the

following headings:

1. Creation of time and place utility: The value utility of a product is created by

production activities, but time and place utilities are created by distribution channels.

2. Innovative product: The new product offered at an attractive price would be of no

use unless there is an efficient distribution system.

3. Easy searching: In marketing, both seller and buyer look for each other to make a

transaction. Distribution channels greatly facilitate this search process by bringing

both parties at one point.

4. Smooth flow of goods: Distribution channels also smooth out the flow of products by

creating possession, time and place utilities.

5. Bridges the gap: Employing distribution channel bridges the discrepancy between the

assortment of goods offered and the one demanded by consumers.

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5.4 Functions of distribution channel:

The distribution channel performs the following function:

1. Market information: Channels of distribution can play a vital role in marketing

research. They can collect and disseminate various market information about

potential and current customer’s competitors and other forces operating in market.

2. Promotion: Middlemen sometimes motivate and train retailer’s sales staff.

Retailers undertake local advertising and special demonstration to promote

product.

3. Customer service: channel personnel provide advice on new and existing

products. They help in test marketing and also help in proper positioning of

products against competitors and suggesting which products to remove from the

market.

4. Pricing: Middlemen often have a strong say in pricing decisions. They stipulate

their required market ups, trade discounts and off-season discounts.

5. Distribution: Channel members assist in distribution activities such as

transporting, warehouse, and customer contact and inventory and stores

management.

Distribution channel also perform several other important functions such as,

it helps ion Production Planning, making pricing decisions, negotiation, sorting,

assorting, financing, physical possession of goods, risk taking and also in the

introduction of new products.

5.5 Types or classification of Distribution channel:

A producer has to find out the most economical form of distribution. There are a number of

different channels open to the marketer. These can be grouped under two major headings:

1. Direct selling by manufacturers (or direct channel): In the most direct channel are

no intermediaries between the producer and the final consumers, not through

middlemen. Direct channels are most common in industrial marketing. Industrial

components, heavy equipment, machinery installation are generally sold on a direct

basis. Direct channels are also undertaken in the case of agriculture.

Bata Ltd, calica mills, Raymond’s, DCM, Eureka Forbes Ltd are some of the concerns

employing direct channels in India.

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A company can adopt the following means for direct selling.

Own Retail shops

Personal selling door-to-selling)

Mail order selling

Franchised shops

Telephone selling (telemarketing)

2. Indirect Selling through Middlemen (or Industrial Channels): Indirect selling

can be performed through two types of outlets:

(a)Merchandise agents and brokers

(b) Merchant wholesalers

(a) Merchant agents and Brokers: Producer may entrust the selling job to someone

else. Like selling agents, brokers, commission merchants etc. These are independent

businessmen who work on a commission basis. They do not own title to the

products they sell, although they may physically handle them. These facilitate

selling functions by bring and sellers together.

(b) Merchant wholesalers or trade channels: These are the firms we usually refer to

as wholesalers. Jobbers or distributors. They typically are independent owners and

they take title to the products they handle. They firm the largest single segment of

whole selling firms. If a producer chooses to use this trade channel, he has a choice

of following channels:

1. Producer Retailer Consumer

2. Producer Wholesaler Retailer Consumer

3. Producer Wholesaler Semi-wholesaler Retailer Consumer

4. Producer Agent Retailer Consumer

5. Producer Agent Wholesaler Retailer Consumer

6. Producer Wholesaler Consumer

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These are shown in the figure given below:

Fig: Distribution Channels

5.6 Types of Intermediaries:

As mentioned earlier, there are served types of marketing intermediaries. They are:

1. Sole-selling agent

2. Marketer

3. C&F agents (CFA’s)

4. Redistribution stockiest

5. Stockiest/distribution/wholesaler

6. Semi-wholesalers

7. Retailer /dealer

8. Broker

9. Franchises

10. Authorized representation

11. Commission agents

12. Jobbers

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Wholesalers/distribution

Manufacturers/Producers

Agents/brokers

Retailers Retailers

Consumers and organizational end-users

Sole-Selling Agent: When a manufacturing prefers to stay out of the marketing

and distribution task, he appoints a suitable agency as his sole-selling agent/marketer

and entrusts the marketing job with him. A “sole-selling agent” or a “marketer” is

usually a large marketing intermediary with large resource and extensive territory of

operation large resource and have one or more marketers: but when he opts for a sole-

selling agent, he appoints just one agency as the sole-selling agent.

C&F Agents (CFA’s): In many cases manufacturers employ carrying and

forwarding agents’ often referred to as C&F agents or CFA’s. The CFA’s be described

as special category wholesalers. They supply stock on behalf o the manufacturer or the

wholesale sector or the retail sector. Their function is distribution. Their distinguishing

characteristic is that they do not resell products but act as the agent/representative of

the manufacturer. They act on behalf of the manufacturer and as his extended arm. In

essence, they are manufacturer branches.

Wholesalers/Stockiest/Distributor: A ‘wholesaler’ or ‘stockiest’ or

‘Distributor’ is also a large operator but not on a level comparable with a marketer or

sole selling agent, in size, resources, and territory of operation. The wholesaler/

stockiest/ distributor operates under the marketer-sole selling agent, Where such an

arrangement is used by the manufacturer.

Semi-Wholesalers: Semi-Wholesalers are intermediaries who buy products

both from producers or wholesalers in bulk, break the bulk and resell the goods

(mostly) to retailers in assortments needed by them. Like the wholesalers, semi-

wholesalers too perform the various wholesaling process. In some cases, they may also

perform the retailing functions.

Retailer/ Dealer: Retailers sell to the household/ ultimate consumers. They are

at the bottom of the distribution hierchy, working under wholesalers/

Stockiest/distributors/ semi-wholesalers as the case may be. In case where the

company operates a single-tier distribution system, they operate directly under the

company. They are also sometimes referred to as dealers or authorized representatives.

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5.7 Types of channel levels in distribution channel

The producer and the final customer are part of every channel. The length of a channel is

designated through the length of a channel. A distribution channel can have any number of

levels. Some of which are described below:

a) 0-level channel: A zero-level channel is also called marketing channel. It consists of a

manufacturer selling directly to the final customer. The major examples are door-to- door

sales (eureka Forbes), home parties (Tupperware), mail order (Otto Burlington),

telemarketing (ICICI Banks cards), T.V selling (Amazon, India times), and manufacturer-

owned stores (Bata, Indian oil, Bharat petroleum petrol pumps).

b) One-Level channel: A one-level channel contains one selling intermediary. These

intermediaries may be retailers or distributors. This is the most common channel in case of

consumers durable such as textiles, shoes, readymade garments, and so on. In case of

textiles most of the mills have their retail outlets throughout length and breadth of the

company.

c) Two-level channel: A two-level channel contains two intermediaries. In consumer

markets, these are typically a wholesaler and a retailer. The companies producing

consumer non-durable items use this where the wholesaler stock the production in

different parts of the nation or a region and from there, the products are supplied n smaller

quantities to the retailers and who in turn sell to the consumers.

d) Three-level channel: A three-level channel contains three intermediaries. For e.g. in

meatpacking industry wholesalers sell to jobbers, who generally are not served by large

wholesales.

Distribution channel with even more levels exist. Typical private food distribution systems

may have five to six levels consisting of itinerant merchants, commission agents,

wholesalers, semi-wholesalers, and retailers. As the number of levels increase, the level of

difficulty of information sharing and coordination also increases. However, the cost of a

channel system is not necessarily proportional to its length/levels.

21

0-level 1-level 2-level 3-level

Fig: Consumer marketing channel

0-level 1-level 2-level 3-level

Fig: Industrial Marketing channels

22

MANUFACTURER

CONSUMER

MANUFACTURER

WHOLESALER

JOBBER

RETAILER

MANUFACTURER

WHOLESALER

RETAILER

CONSUMER

RETAILER

CONSUMER CONSUMER

MANUFACTURE

R

MANUFACTURER MANUFACTURER MANUFACTURER MANUFACTURER

Manufacturer’s

representative

Industrial customers

Industrial customers

Industrial customers Industrial customers

Manufacturer’s

representative

Industrial distributor

DISTRIBUTORS

A. Number of contacts without a Distribution

1

2

3

4

5

6

7 8

9

Manufacturer X Customers =3x3=9

Manufacturer =Customer =3=3=6

23

Manufacturer

Manufacturer

Manufacturer

Customers

Customers

Customers

Manufacturer

Manufacturer

Manufacturer

Distributor Customers

Customers

Customers

5.8 Factors governing the choice of distribution:

The factors governing a choice of distribution channel can be grouped into four segments as

product, market, and institutional unit and environmental. The product factors are: physical

nature, technical nature, the length of product line, the market position. The market factors:

the existing market structure, the nature of the purchase deliberating availability of the

channel, members the post service ability. The unit factors are: the companies’ reputation, the

company marketing policies. The environmental factors are: economic factors, the legal

restrictions and fiscal policies.

5.9 Factors governing the choice of an Intermediary:

The major factors governing the choice of an intermediary are: (1) the market served, (2)

the market reputation, (3) Continued existence,(4) The Specialization in selling, (5) the sales

policies, (6) the nature of sales organization, (7) the financial position, (8) The facilitate

available.

5.10 The channel policies and Strategies:

The channel policies and strategies can be classified into two categories as distribution

intensity based and others. The distribution intensely based policies and strategies are: (1)

intensive distribution policy, (2) Selective distribution policy, (3) Exclusive distribution

policy. On the other hand other policy options are: (3) the policy of full-line forcing, (4) the

policy of reciprocity, (5) Dual and multiple distribution policy (6) the policy regarding

conditions of transactions.

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5.11 Other dimensions of channel management:

1. Channel Compensation: channel Compensation deals with the financial and non-financial

compensation payable to the channel members. There should be clear understanding about the

same between, the parties. The basis of payment shall be extended of functions performed.

The forms of compensation may be commission of discount.

2. Channel motivation: channel motivation stands for the encouragement given to the

channel members to increase the sales and profits and reputation of the concern of the channel

commander. Though there are many ways of motivating the channel members to better

performance, the best form of incentives can be profit margins, commissions, discounts and

exclusive franchise.

3. Coordinating: channel coordination stands for the integration of channel operations with

those of channel commander so that all the3 activities directed at the market are funneled for

the maximum market impact. In other words, the conflict that arises is to be killed at any rate.

The causes of conflict are three: (i) the strong desires at high level to cover fixed costs. (ii) By

passing the intermediaries though such by phases is not allowed and (iii) Different

interpretation regarding role of intermediaries under different status and financial conditions.

The effects of conflict are disastrous. It kills the cooperative spirit, faith, and trust. The effects

of are disastrous. It kills the cooperative spirit, faith, and trust. The firms respond to such

channel conflict is one of the ways; these ways are withdrawal repression internal changes_

use of power. The conflict management strategies are: (1) bargain strategy (2) boundary

strategy (3) penetration strategy, (4) supra organization strategy.

4. Channel Control: channel control implies a course of planned efforts of channel

commander to ensure that the channel intermediaries behave with him, his consumers and

other channel member in the manner desired by him. The measures of control are : use of

power bases after deciding the nature and extend of control needed. These power bases are

reward-coercive-expert- identification and legitimacy.

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6. Distribution Channel of J.K Tyres Ltd

6.1. Distribution Patter of J.K Tyres:

As per the study conducted, it was found that J.k Tyres in Guwahati is a C&F (carrying and

Forwarding agent) . a carrying and forwarding agent can be described as a special category

wholesaler. The supply stock on behalf of their manufacturer to the dealers and through them

directly to the manufacturer.

The C&F in Guwahati , is the main C&F in the entire North-East. And their other C&F’s in

North-East are Shillong, Agartala,and Jorhat.

J.K Manufacturer

C&F’s

Dealers

Customers

Fig: Distribution channel of J.K tyres

In addition to supply through C&F’s. J.K Tyres is also engaged in direct selling. They are

engaged in direct selling through O.E fitment with Ashok Leyland, Swaraj Mazda, Tata,

Maruti, Wagon R, Alto etc

J.K Manufacturer use 2-level channel, which consists of manufacturer, godown, dealer, and

customer.

Manufacturer C&F’S Retailer Consumer

26

These channels are selected on the basis of market to be captured. They are able to capture the

market very efficiently and distributed to different regions/areas through their dealers. Their

tyres are nearly exported ton80 countries. And they market the products on order, i.e. on the

basis of order received. And the C&F located in Guwahati distributes the tyres to the entire

North-East region.

6.2 MAP SHOWING J.K TYRE’s OPERATION IN INDIA IN INDIA

27

6.3 THEIR OPERATION IN NORTH-EAST INDIA:

28

7. Research Methodology

7.1: Research Objectives: As a management student, it has been thought to is that the

systematic process of any work is done through setting the objectives. Without framing or

setting the objectives and prioritization the assigned job, many come out with unhappy results.

Apart from this, one proceed to do any assignments or project works, if the objectives are not

set and given due importance.

Keeping in mind that, with the definite objectives of the work, the works are completed in a

clear cut way. I have framed some objectives to study the “distribution Channel” of “J.K tyres

Ltd” which are as follows:

1. To know about the type of distribution channel they use.

2. To know about the functioning of the various distribution channels

3. To know their procedure of working

4. To know that5 how they help in bringing the producers and the consumers together

5. To know that whether they are able to maintain a good relation with customers

6. To know the problems that they face while distribution the products

Thus, the objectives so set up for the given topic were helpful in carrying out the project work

successfully. Without the setting of objectives, systematized manner

7.2 Research Methodology: There are various methods available for collecting the

information. The methodology used in conducting this was:

Questionnaires

Observations

Interview

Basically, there are two types of data methods: Primary and Secondary. My

information’s are collected from both the sources (primary and secondary).

Primary Data: The primary source includes:

1.Questionnaire: In this method a set f questions are prepared with a view to collect the

requisite information. For using this method, I first made the questionnaire, get it typed in the

computer and

29

then obtained the printed questionnaires were then given to the respondents to fill it.

Questionnaire can be classified into four main types:

a) Structured- non- disguised

b) Structured-disguised

c) Non structured-non-disguised and

d) Non-structured-disguised

Another important aspect in the questionnaire method is the type questionnaire methods is the

type of questions used. Questions can be classified into:

Open-ended questions and

Close-ended questions

In collecting the information about my project I used. Structured-non-disguised questionnaires

and the type of questions which I used in the questionnaire are mostly close-ended questions.

All the close-ended are multiple choices and the type of open-ended questions is completely

unstructured.

2. Direct interviewing: oral interviewing (whether formal or informal) is one of the best ways

to collect the information. Most part of my information’s are collected with the respondents

3. Simple observation: observation is another important technique of collecting the

information. Some of my in formations are gathered from simple observations. Some things

are easily observable but some are not. Whether things I have observed are added to my

information collected.

Secondary data: secondary data are those data which have been gathered earlier for some

other purpose. The primary data collected by one person may become the secondary for

another.

For my study, I made use of these secondary sources too. The data I gathered through these

secondary sources are the company profile, area detail, company’s goals and objectives etc.

30

Design of Research

Primary data Secondary data

Sources of data

i. Questionnaire

ii. Observation

Data needed are founded

I. Company

II. Internet

Data analysis

By graphs,

histograms,

pictures

Period of time

8. Methods of data collection

8.1 Introduction:

In every aspect of the project which is designed on the basis of some

observation or research, is made with adopting particular methods and techniques, while

doing any research or project work, every information should be unbiased and not prejudiced,

based on truth and veracity

.in J.K Tyres Ltd (company study was done systematically and thoroughly on the company’s

distribution department companied dealers in relation to the topic, which is conducted at the

company and design a data collected source of data information.

8.2: Methods of data collection:

Both primary and secondary sources are used for data collection

1. Questionnaire method

2. Discussion with the guide

3. Companies document

4. Sampling techniques : for this study I selected random sampling method

Random sampling method: a random sampling technique is one in which sampling units

are selected by chance for which there is known, non-zero probability of selection.

Sample size: after determining the sampling methods, the next step to be taken care of

is to take an important decision regarding the sample size or adopting a technique about the

size or the sample.

Number of employees at J.K Tyres Ltd: 15

Number of persons/employees evaluated:7

32

9. Data Analysis and Interpretation

After the conduction of the project work through various methods, the important aspects as

regards to the topic were found out. All necessary details are described one by one below:

A. Findings from observing the C&F and interviewing the managers:

1.Role of distribution channel: A channel of distribution plays as important role in the

making of goods and services because the ultimate goal of all marketing activities is to

effectuate the transfer of ownership of goods to customers. And in this regard, it was found

that; distribution channel plays a vital role in product distribution. It serves the very basis of

all the essential functions that are needed to deliver the product to the final consumer/user.

2.Type of distribution: A producer has to find out the most economical form of distribution.

There are a number of different channels open to the marketer; which are grouped under two

major categories, namely direct and indirect selling. And as per the findings, J.K Tyres in

Guwahati is a C&F (carrying and forwarding agent). A carrying and forwarding agent can be

described as a special category of wholesalery. They supply stock on behalf of their

manufacturer to the dealers and through them directly to the customers. They act as agent/

representative of the manufacturer.

The C&F in Guwahati is the main C&F in the entire North-east. And the other C&F’S are in

Shillong, Agartala, Jorhat.

J.K Manufacturer

C&F’s

Dealers

Customers

Fig: Distribution channel of J.K Tyres

33

In addition to supply through C&F’S. J.K Tyres is also engaged in direct selling. They are

engaged in direct selling through O.E fitment with Ashok Leyland, Swaraj Mazda, Tata,

Maruti, Wagon R, Alto etc

3. Channel Level: The producer and the final customers are part of every channel. The length

of a channel is designed through the length of a channel. A distribution channel can have any

number of levels which many varies between 0-6.

And, as per the study conducted it was found that J.K Manufacturer use 2-level channel,

which consists of manufacturer, godown, dealer, and customer.

Manufacturer C&F’S Retailer Consumer

4. Basis for selecting distribution Channel: The channels are selected on the basis of

market area to be captured. They are able to capture the market very efficiently and

products are efficiently distributed through their dealers. Their tyres are nearly exported

ton80 countries. And they market the products on order, i.e. on the basis of order received.

And the C&F located in Guwahati distributes the tyres to the entire North-East region.

5. Product Distribution: J.K Tyres are distributed nationally as well as internationally. J.K

Tyres are nearly exported to 80 countries. And they market the products on the basis of

order received. And the C&F located in Guwahati distributes the Tyres to the Entire

North-East region.

6. Relation with international; customers: In this regards, it was observed that, J.K Tyres

maintain good relation with its customers. From the survey conducted, it can be conducted

that J.K tyres maintain a good relation with its dealers; and good relation with its dealers;

and there is no conflict between them.

7. Channel strategy: Designing appropriate channel strategy is very important aspect in

distribution. And J.K tyre sales design appropriate channel strategy for their distribution.

For effective functioning, they rain and motivate their international to perform efficiently.

They also provide them with attractive scheme all throughout the years, which act as

motivation for them. And, for the customers, they replace, the tyre if a manufacturing

defect is found.

8. Types of Market: J.K Tyres markets, it product through:

a. O.E- Fitment ( Original Equipment Fitment): In O.E Fitment , J.K Tyres has tie-

up with Ashok Leyland, Swaraj Mazda, Tata, Maruti, Wagon R, Alto etc

b. For Government orders: One of their important markets is order from government.

They sometimes receive orders from government for, State Transport service like DTC

etc. at present; they have an order of tyres for I-bus for common wealth games.

c. Replacement Market: This is the most important and maximum revenue market for

the organization. Replacement market means, the market for replaceable tyres, as the

tyres have a definite life span, they need to be replaced after that period of time and in

turn creates the most important market for them.

35

O.e Fitment market

25%

Govt orders19%

Replacemant market

56%

pie showing the percentage of the differntn type of markets

B. Findings from surveying the Market and interviewing the dealers:

1. Are the dealers satisfied with the Distribution channel provided to them?

Sample Size-5

Highly Satisfied-1

Satisfied-3

Dissatisfied-1

Highly Dissatisfied-0

2. Do they apply any terms & conditions for Distribution:

Sample size-5

Yes-0 No-5

In this regard it was found that J.K Tyres does not apply and terms and condition to the

dealers for distribution.

3.Is, there any conflict arises between you and your distributor?

Sample size-5

No – 5 Yes - 0

According to the study conducted it was found that, there is no conflict between the dealers

and distributors. They have good relation between them, and the distribution department of

J.K tyres also keeps consideration that the dealers are satisfied in all possible ways.

36

20%

60%

20%

0%

pie showing the satisfactory level of dealers in context

to distribution channel

Highly stisfied

Satisfied

Dissatisfied

Highly disstisfied

4.Their Operation in North-East: The Company started its operation in North-East India

in 1977. It has regional set-up in Guwahati, Shillong, Dimapur, Agartala which are

operated by C and F agent.

According to the company, the total market potential of North-East for various tyre

segment are as follows.

Truck radial 17312 (approx)

LCV 6060 (approx)

Radial 11000 (approx)

Passenger Bias Tyre 2250 (approx)

37

truck radial

LCV

Radial

Passenger Bias tyre

Market potential of north east for Tyre segment

4. Their Average Monthly sales (in units):

Truck Radial : 3000

L C V Tyre : 1474

Radial : 5850

Passenger Bias Tyre : 800

40

Truck Radial27%

LCV Tyre13%

Radial53%

Pessenger Bias Tyre

7%

pie showing Average Monthly Sales in Units

9. Limitations

Despite of the meritorious conduct of the project, certain hindrances occupied some places

in my work. Even though I tried with my heart and soul to put my best effort in the work,

yet I could not escape from the limitations that surrounded me. The following are the

limitations that surrounded me. The following are the various obstacles that hampered me

during the course of my project:

1) The Managers were too busy with their work

2) It was difficult to seek appointment on a particular day and time; we had to reach the

place at anytime, whenever the manager finds time free time for our training.

3) The Distance of the office from the Godown was very much, s o we had to face

difficulty in reaching there.

The following limitations so prevailed were only constrains that were hampering me in the

preparation of project. But the best efforts that I could put in my work was to some extent

relived of the other limitations that could have been occurred.

`

41

10: Suggestions

After the competition of the various references of the project, various circumstances in contrast to

the project were observed under the given circumstances:

1) It should try to locate its office premise near the godown for easy and fast delivery of the

products i.e. tyres

2) It should also try to maintain separate godown for different varieties of tyres. If not for all,

then at least for the major varieties of tyres.

11. Conclusion

It constitutes the last part of the project work done. And this project work has been made on

the ‘Distribution Channel’ of J.K tyres ltd and is done using three main approaches, namely

questionnaire, interview and observation. From the given report of the topic, the following

conclusions have been drawn:

1. Firstly, it can be concluded that the company has successfully carried out the policy of

distribution.

2. Secondly, it can be said that the company manages its distribution channel very well.

3. All the given policies and procedure of distribution proved to be beneficial for the

company.

4. Lastly, the conclusion to be drawn is that all the dealers as well as the customers are

highly satisfied with the distribution policy of the company.

Thus, the following are the conclusion that have been drawn after completing the full project

report of the distribution of J.K Tyres Ltd

42

13. Bibliography

1. Beri G.C, “ Marketing Research”3rd edition (new delhi:Tata Megraw –hill publishing

company limited)

2. Daver S Rustom “Modern marketing Management”, 7th edition(new delhi:universal

Book stall 1999.

3. Philip kotler-Marketing Management,10th edition (the Millenium edition) (new Delhi,

prentice-hall of India private Limited 2003.

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