Sales And Distribution Channels For Rural Marketing Marketing Essay

The laminitis of the company Dr. Karsanbhai khodidas patel was born in 1945, in Ruppur small town in north Gujrat in a household of husbandmans. He graduated in Chemistry at the age of 21. Initially, he worked as a lab technician and subsequently served the province authorities. In 1969 at the of 24, he started fabricating phosphate free detergent pulverization, Nirma ( Named after his girl Nirupama ) in his backyard. He dedicated after office hours for fabricating Nirma and sold on his bike while traveling to his workplace, which was 17km from his place. The hand-crafted detergent packages were sold at rs 3 per kilogram, which was tierce of so least priced popular detergents.

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At the clip domestic detergent market was limited merely to premium section and was dominated by MNCs. Karansbhai patel started door-to-door merchandising of Nirma and priced it at Rs 3 per kilogram. The following available cheapest trade name in the market at that clip Rs13 per kilogram. Nirma revolutionized the whole detergent pulverization section and in a short span of clip created an wholly new market section in the domestic detergent sector market. It gave the bigger established trade names a tally for their money and shortly occupied the top market portion. To add to this Nirma was made of an advanced preparation, which planetary detergent giants were subsequently on compelled to emulate, it was phosphate free and hence environment friendly and the procedure of fabrication was labour intensifier, which offered big scale employment.

Equally far as Corporate societal duty is concerned, Nirma has made some good attempts by get downing Nirma Education & A ; Research Foundation ( NERF ) in the twelvemonth 1994 for the intent of running assorted educational establishment. The company has besides set up Nirma labs, which prepares draw a bead oning enterprisers to efficaciously confront the different concern challenges. Nirma besides runs Nirma Memorial Trust, Nirma Foundation and Chanasma Ruppur Gram Vikas Trust as a portion of their attempt as a socially responsible corporate citizen. It besides owns Nirma University.A

The University emphasizes on the all unit of ammunition development of its pupils. It aims non merely at bring forthing good professionals, but, besides good and worthy citizens of great state, helping in its overall advancement and development.

Equally far as corporate societal duty ( CSR ) is concerned, Nirma has made some good attempts by get downing Nirma Education & A ; Research Foundation ( NERF ) in the twelvemonth 1994 for the intent of running assorted educational institutes. Nirma has besides set up Nirma labs, which prepares

Nirma is a cutomer focussed company committed to systematically offer better quality merchandises and services that maximise value to the client. The company realised that it would hold to establish merchandises for the upper terminal of the market to retain its in-between category consumers who would graduate to the upper terminal. So in 2000 Nirma had a 15 % portion in the lavatory soap section and more than 30 % portion in the detergent market. Nirma is the Rs.17 billion Detergents soaps and personal attention Products Brand, a market leader in the Indian detergent market and 2nd largest in bathing soap. The trade name NIRMA being one of the universe ‘s biggest in its section. It has its mission statement like “ Better Products, Better value, Better life ” . Karsanbhai Patel is the president of the Ahmedabad-based Nirma Ltd. This chemist who manufactured detergents at place in Ahmedabad in 1969 has surely come a long manner. He worked from his backyard which developed into a soap mill, cycled

About Rural consumer

Rural dwellers are n’t a different species, but consumers as quirkily and demanding of sellers as any of their urban cousins. And merely every bit eager to devour or may be even more so, given their entree to messages of ingestion via Television, but missing the easy entree that makes urban consumer ‘s blase . For sellers the potency is immense, a state is waiting for their merchandises, supplying they can do the attempt to exports inwards and learn to play the games by rural regulations. Even with the minimum attempt put in the by companies so far, rural India now account for bulk, or near bulk, ingestion in many classs. Rural India is certainly non such an country of darkness any longer. One of the most popular and widely recognized myths is that the rural consumers will merely purchase truly inexpensive mass market trade names. But the blunt world is that though trade names like Nirma lead, but incursion of premium merchandises has besides been observed even to the lowest SEC.

Gross saless –

The company ‘s established market place is based on its strong trade name equity, built over old ages. The company has adopted an umbrella stigmatization scheme ( Nirma and Nima trade names ) and has rationalised its advertisement cost ; this scheme has besides launched several merchandises under the female parent trade name which is Nirma. Nirma sellsA over 800000 tones of detergent merchandises yearly, A giving it a35 % portion of the Indian market, which are the universe ‘s 2nd largest cloth washA merchandises markets. This makes Nirma India ‘s largest detergent seller and one of theworld ‘s biggest detergent trade names

Gross saless competition

he consequence of there cost effectual merchandise offering is that though the industry hasA been turning at the rate of 15 per cent yearly, Nirma ‘s growing has been at least 30-35A per cent a twelvemonth for theA last few old ages.

The pricing policy adopted by Nirma for its Nirma lavation pulverization i.e. adequateQuality at an Low-cost priceA has challengedA the mighty HLL ‘s Surf.A Nirma Washing PowderA 1kg18.00A Nirma Washing PowderA 500grams9.00Even the 2nd merchandise that Karsanbhai introduced-a low-cost lavatory soap, which he exhaustively test marketed in Gujarat before traveling national with it in 1990-hsA been doing good. Nirma lavatory soap retails at aA mere Rs.2/- with the tradesman allowed toretain 25 paisa behind each bar sold. The Nirma name itself was aA warrant of qualityfor the consumer smiles the man of affairs. It found ready credence. Today, Nirma’stoilet soap merchandises are priced in the scope of Rs 6-9. Nirma Lime Fresh, for case, commands a monetary value of Rs 8 for 75 gms, while Nirma Premium is priced at Rs 9. NirmaBath, a popular soap, is priced at Rs 6. In comparing to Nirma ‘s monetary value scope, HLL ‘s toiletsoap trade names are priced at a little premium. LifeBuoy is priced at Rs 14, and LifeBuoy

Gold at Rs 9. The monetary value of Rexona is Rs 9.50, while that of Liril, which competes withA Nirma Lime Fresh, is Rs 13.

Net Gross saless

During the fiscal twelvemonth 2006-07, the Detergent, Soaps, Soda Ash and LAB continued to be a prima merchandises for the Company. During the twelvemonth under reappraisal, Detergent and Soap at Rs.1640 crores accounted for 64.59 % of the gross gross revenues, Soda Ash and Linear Alkyl benzine at Rs.673.44 crores accounted for 26.52 % of the gross gross revenues. Now as per the company ‘s fiscal statement in March 2005-06 Nirma ‘s entire sale Rs. 1918.80 crores it was bit by bit increased due to their trueness and successful market scheme with their costumiers and their investors. After within three old ages gross revenues increased up to approx Rs. 3000 carores 2008-09. And old old ages Nirma ‘s entire net sale was 3246 crores that means approx two 1000 carores increased in a one twelvemonth.

( Beginning ; – Annual Reports of Nirma Ltd. Year 2005 to 2011 )


AA stock marketA orA equity marketA is a public entity ( a loose web of economic minutess, non a physical installation or distinct entity ) for the trading of companyA stockA ( portions ) andA derivativesA at an in agreement monetary value. TheA stock marketA is one of the most of import beginnings forA companiesA to raise money. This allows concerns to be publically traded, or raise extra fiscal capital for enlargement by selling portions of ownership of the company in a public market. History has shown that the monetary value ofA sharesA and other assets is an of import portion of the kineticss of economic activity, and can act upon or be an index of societal temper. An economic system where the stock market is on the rise is considered to be an energetic economic system. In fact, the stock market is frequently considered the primary index of a state ‘s economic strength and development. Market participants include single retail investors, institutional investors such as common financess, Bankss, insurance companies and hedge financess, and besides publically traded corporations merchandising in their ain portions. Some surveies have suggested that institutional investors and corporations trading in their ain portions by and large receive higher risk-adjusted returns than retail investors.

High and Low portion monetary values during each month in the last fiscal twelvemonth on the National Stock Exchange of India Limited are as under:

( Beginning ; – Annual Reports of Nirma Ltd. Year 2005 to 2011 )

In Apr 2006-07 administration ‘s highest portion monetary value was Rs.166 and low month ‘s monetary value was Rs.140. it was bit by bit increased up to Rs. 14 and low monetary value of portion besides increased up to Rs. 10 in the month of Apr. 2008 ( Rs.180 ) . After that it was decline Rs. 180 to Rs. 134 in following twelvemonth i.e. Apr 2009. And once more it increased Rs. 81 ( Rs. 134 to 215 ) . Rising portion monetary values, for case, be given to be associated with increased concern investing and frailty versa. Share monetary values besides affect the wealth of families and their ingestion.

Net Net income

“ How does a company decide whether it is successful or non? Probably the most common manner is to look at the net net incomes of the concern. Given that companies are aggregations of undertakings and markets, single countries can be judged on how successful they are at adding to the corporate net net income. Net net income, besides referred to as theA underside line, A net income, orA net earningsA is a step of the profitableness of a venture after accounting for all costs. In a study of about 200 senior selling directors, 91 per centum responded that they found the “ net net income ” metric really utile.

Here we draw the Net Net income Graf of Nirma Ltd. on the footing of their one-year fiscal studies.

( Beginning ; – Annual Reports of Nirma Ltd. Year 2005 to 2011 )

In March 2005-06 Nirma ‘s net net income was approx Rs. 200 crores. It was diminution in 2006-07 up to Rs. 109 crores. In 2007-08 it was once more increased to Rs. 100 crores ( 229.73 ) . Again it was declined Rs. 229.73 to Rs. 93.43 crores. Last in old twelvemonth ( 2010-011 ) net net income was declined up to 237.94 crores to Rs. 74.04 crores. So we can state that it ‘s a autumn and rise in company ‘s net net income.

SWOT Analysis

Strength- 1 ) Strong trade name equity developed over the old ages

Wide distribution web

Market leading in detergent market

Highly successful initial advertisement run

In 2004, Nirma ‘s detergent approached 800,000 tonnes- one of the largest volumes sold in the world- under a individual trade name “ NIRMA ”

Weakness- 1 ) Limited export market as compared to international trade names

Unable to wholly perforate in premium section because of image.

Opportunity- 1 ) Export to developing states

2 ) Addition market portion in premium section by establishing discrepancies.

Threats- 1 ) Guerilla onslaught from local independent manufacturers

2 ) Broad onslaught from HUL and P & A ; G

3 ) Turning income of Indian can do displacement to premium section rinsing pulverizations.

Distribution scheme


Nirma is competently considered as a selling miracle and this is reflected in the strength of the trade name. Nirma has successfully challenged and changed the conventions of detergents marketing. Nirma ‘ nucleus selling push revolves around advancing consumer tests by offering a the same “ Value For Money “ equation. This is borne by the fact that today Nirma can tout of a strong trade name loyality from its


Iwory tower theories are rethinking their concern basics- thanks to Karsanbhai K.Patel. Taking on the might of a transnational, his-priced detergent Nirma captured a bulk market portion collaring the gross revenues and growing of a consumer giant ‘s up market trade name. Among the greatest success narratives of its selling direction in India is that of a low-cost detergent of moderately good quality which, in the class of a mere decennary, put the skids on a merchandise that was considered the pride of a powerful transnational.

For Harried homemakers, fighting to equilibrate their monthly budgets, Nirma came as a roar. It was much cheaper than breaker, which had already gone good out of their range and it washed apparels about every bit good. Its cleansing power was far superior to that of the slabs of inexpensive rinsing soaps that had been their exclusive option until so. By the early 1980s the burgeoning gross revenues of Nirma reached a rate of growing that was twice or thrice that of the industry in general. Furthermore, Nirma operated in the small-scale sector and hence saved an tremendous sum of excise responsibility that multinationals had to pay on every kg of detergent produced. The latter merely could non trust to convey the monetary value down to a degree that was attractive plenty for the in-between category, which were the majorities section for Nirma gross revenues. The pricing policy adopted by Nirma for its Nirma lavation pulverization i.e. equal Quality at an Low-cost monetary value has challenged the mighty HLL ‘s Surf.



In its initial old ages, distribution in Nirma was done by Karsanbhai Patel ‘s web and gross revenues force and at that clip it was one-person squad and the adult male was he himself. As the popularity of Nirma grew with a spread of positive viva-voce Karsanbhai adopted the time-honored Coco Cola axiom that his merchandise should be available within an arm ‘s length of desire. So he concentrated on widening his distribution webs ; nirma began covering all over Gujrat, in about every store in even the remotest country or small towns. As the merchandise ‘s fame spread, agents from all over the state began composing in, and showing their willingness to run on the bantam borders that man of affairs gave. When puting up a distribution system Karansbhai was highly cognizant of the importance of maintaining cost down. Once demand for Nirma had outgrown his ability to present on bike he moved on to new waves and so subsequently to trucks. Nirma neither a field gross revenues force nor owned a distribution gross revenues grew network.Karansbhai negotiated monetary values with trucks and new wave providers on day-to-day footing. As gross revenues grew Karsanbhai finally hired stockist as committee agents. On the one manus it helped him avoid cardinal gross revenues revenue enhancement and the stockist were responsible for all transit, octroi, managing and bringing cost. There was besides a rigorous system of protocol and distribution depended on prepayment for stocks in order to minimise the hazard for Nirma.

The company has set up for Nirma a parallel distribution and gross revenues channel dwelling of 1500 distributers and an independent gross revenues force. A two tier web, the Nima distribution channel is “ level ” enabling fleet market response. The company took great attention that the new trade name did non cannibalise on the bing barnds. The Nima portfolio today compliments the Nirma scope, fostering the company ‘s scheme of value for money.

Degrees of channel Distribution

Company Manufacturing Unit of measurement






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Success rate

Karansbhai got success because he had a good cognition of chemicals and he came up with Nirma detergent which was a consequence of advanced combination of the of import ingredients. Autochthonal methods were used and besides the detergent was more environments friendly.

“ It all started to gain a side income, and at that phase, I had ne’er imagined this sort of success ”