SCHOOL OF COMMERCE

SALES AND DISTRIBUTION

MANAGEMENT
Distribution Assignment

Company: HALDIRAM

SUBMISSION BY:
SUMBITTED TO Khushi Agrawal
Dr. Vippa Dingra Pragati Bajoria
Roshni Goyal
Sagar Deshpande
 COMPANY PROFILE

Haldiram’s:
The Company which is today synonymous with Indian snacks and sweet food market started the
first chapter of the saga, as a small sweet shop in Bikaner, Rajasthan in 1935. By 1982, the
company had set up its business in Kolkata, Nagpur & the bustling Chandni-Chowk in Delhi.
Promoted by two 1st generation entrepreneurs Mr. M.L. Agarwal & Mr. M. S. Agarwal and backed
by Board of Directors (Mr. Pankaj, Anand, Amit, Ashish & Umesh Agarwal) and Management
Team (Dr. A.K Tyagi (Pres), P.K. Agarwal (Consultant), Rahul Kathuria, VK Gupta, Mr. A.K.
Tyagi). The Vision and Mission of the company is to have global presence as Food & beverage
company through
 Innovation
 Professionalization
 Expansion
 Strategic Approach
 Business Acquisition
The story of the iconic bhujia maker is quite inspirational. It grew from a small namkeen shop in
Bikaner, Rajasthan into a multibillion-dollar company. It began in 1918 as a part-time hobby for
extra income has today become a behemoth enterprise in the food industry in India generating over
to Rs.7000 crores in annual revenue combining the business of Kolkata, Delhi and Nagpur groups.
Haldiram’s success saga is because of the pro-active thinking of making access into the traditional,
fresh homemade food and skilfully converting it into a product line extension. With it they have
busted the myth that Indian consumers will not pay extra for western concept of packaged food and
that two of the Indian Household kitchen categories.
Haldiram’s ingredients of success recipe includes a diversified product portfolio, stringent quality
controls, good raw material, storage, production and packaging processes which has resulted in
unparalleled taste and extended shelf life.
Today, Haldiram’s can proudly claim that what began as a small-time enterprise in India is a global
phenomenon now and HALDIRAM’S IS WAY OF LIFE FOR INDIANS NO MATTER
WHICH COUNTRY THEY LIVE IN.
USP
Wide range of hygienic, tasty and authentic Indian savouries and sweet.
POSITIONING
The initiatives undertaken by the company helped Haldiram to uniquely positioned its brand.
Haldiram also gained and edge over its competitors by minimising production cost. Success of
Haldiram is a sheer example of word of mouth or mouth to mouth publicity.
Appreciating the company’s efforts at building a brand, and analyst said, “Haldiram once was just
another sweet maker but it has moved into trend brands first by improving the product quality and
packaging. Through its clever products and brilliant distribution, it had moved into the star category
of brands.”
PRICING
Haldiram charge a decent premium owing to the branded and well packaged products. They give a
huge importance to good presentation and lively packaging as a way of differentiation from other
non-branded an organised products and there is demand a premium for it. But since the premium is
so small that consumer usually don’t mind giving the trusted high-quality products.
To charm the more price sensitive consumers, Haldiram has come up with small one-time
consumption packages of 40 g which are priced at Rs.10 for its most famous bhujia.
Company has introduced different products under various weights, which have different pricing.
MARKETING STRATEGIES
From the initial days onwards Haldiram never invested much in marketing and advertising to
expand his Brand they gained their business majority through word of mouth. But now due to the
intense competition, they realise the importance of marketing and advertisement and started gaining
attention from them.
One of the major recent campaigns is with Haldiram tied up with a Bollywood movie under Rajshri
production Prem Ratan Dhan Payo, starring Salman Khan and Sonam Kapoor. It launched a
contest for promotion through which they distributed 1.5 crore packets of snacks.
 DISTRIBUTION CHANNEL

Haldiram uses both Direct distribution channel as well as One level channel, as it sells its
products to customers directly through its outlets. Also, several Haldiram products such as
namkeens, sweets, etc are also sold through retailers.
The Supply Chain which is broken down into two categories of retail and institutional sales are
managed well by a strong network.

 The distributor of Haldiram is solely sell their products. They cannot keep any product of any
competitor; ensure they are exclusively Haldiram’s distributors.
 Haldiram transits stock only on an advance RTGS from distributors.
 No cash and cheque mode are entertained at Haldiram.
 There is no credit policy for distributors.
 All Haldiram’s C&F (Carrying and forwarding agent) centers have their own vehicles to
transmit stock to distributors.
 No direct contact through company of distributors, C&F’s can contact directly to company.
 The order is taken by the sales officer along with one sales man of the distributor. The demand
is passed to distributor daily.
 So, the company factory sends the stock to its C&F’s Centers. From C&F’s Centers the
products are sent to distributors. Distributors send the products to retail outlets. The final user is
consumer. This cycle continues daily.
At Haldiram, they have defined their distribution network with respect to the weight and price of
the various products. This is because they have to find their retail outlets in terms of the kind of
product they keep.
Haldiram's developed a strong distribution network to ensure the widest possible reach for its
products in India as well as overseas. From the manufacturing unit, the company's finished goods
were passed on to carrying and forwarding (C&F) agents. C&F agents passed on the products to
distributors, who shipped them to retail outlets.
MARKET ASSESSMENT
In order to get better view on on-ground situation, we interviewed both retailers, distributors and
franchise owner’s indulged in Haldiram at Yavatmal city.

There are approx. 200 distributors.

What is the distribution channel?

Manufacturer > Super Stockist {district} > Distributors {city/ region} > Retailers
What is the distribution channel for your franchise outlet? (Franchise owner’s interview)
The distributor we interviewed had a ‘express outlet’ according to him the distribution channel for
Haldiram express {exclusive Haldiram franchised retail outlets} is as follows-
Super Stockist > Retail outlets directly and some exclusive products directly from company.
CHANGES WITNESSED
There is also a changing perception of consumers towards processed foods served in centralized
food service systems. The primary reason for these changes is the dynamic marketing environment
in the snacks business. Changes in the marketing environment have generated a need to reconsider
the managerial perspectives on marketing in the snacks business. And in this new arena of increased
competition and market saturation, Haldiram’s is still doing well with highly satisfied customers.
As it has very skilled management who can easily sense customer requirements, maintain product
quality and frequent market research always assures product authenticity in the market.
What is your approximate profit margin?
C&F agents received a commission of around 5%, while distributors earned margins ranging from
8% to 10%. On further enquiry we got to know that on an average the profit margin for his type of
outlet (express outlet) ranges from 15-17% and they rarely increase the margins when target
achieved 0.15% more margins on target as reward and no support given from company side to
stockist and distributors.
On an average profit margin are as follows-
 10% for Retailers
 7% for distributors
 4-5% for super stockist
Expectation of distributor and retailer from haldiram?
Expectation of distributors and Haldiram express franchisor stores from Haldiram - there should not
be shortage of stock, both complained about shortage of stock and late deliveries of stock because
of shortage.
On the bases of our interaction with them we can conclude that Haldiram’s should give some
incentives on achieving targets and festive gifts to distributors retailers express. Distributor has
expectation that they should help in sales by providing some sales support to them.

SELECTION OF A DISTRIBUTOR
The first rule of selecting a distributor is no credit. Derived from it, they view the following points
of reference before selecting a distributor
1. Financial strength
2. Reputation in the market
3. The system followed by the distributor
4. Positive attitude
How Haldiram shortlist’s their distributors? (distributor’s and Franchise owner’s interview)
Company selects super stockist and they select distributors, min 15 days stock should be maintained
and 2000 sq. ft inventory needed. Distributor in taluka and super stockist in districts.
A visit planner is designed by the company in collaboration with the distributors, called beat chart.
It is designed to inform the distributor that the company sale exclusive will visit the following
distributors on the following days as per the schedule for order taking and other queries. This helps
both the company as well as distributors to work in an organised manner as each know when the
company will visit and when to expect the stop delivery.
Similarly, the company officials know which distributor to visit when and how the goods will be
dispatched and in what lot sizes.
Shelf placement is an important issue in today’s modern trade stores. Though Haldiram can define
the shelf space they would prefer at these outlets their policy is to let the retailer decided. This is
mainly due to two reasons:
 Firstly, such a demand does not come without a price.
 Secondly, it is believed at Haldiram that their product has the right customer but so
in any case the retailers prefer to keep its product at visible places.
How does the company motivate?
Haldiram’s provide distributorship and franchise in three main versions-
 THE KIOSK- it is the smallest and cheapest available franchise under haldiram, it requires
an investment ranging from 50-60 lakhs, and an area of about 1000-1500 sq. feet.
 THE FAST SERVICE RESTAURANTS- the required investment for this version of
dealership ranges between 1-1.5 crore, and an area of about 2000-3000 sq. feet
 THE CASUAL DINING- this version falls under the category of the most-grand franchise
under Haldiram’s, this requires an investment of about 70-80 lakhs, and an area of about
1000-2000 sq. feet
The main motivation behind being the Haldiram’s distributor and franchise lies in the fact that the
dealer and distributor need not to invest time and funds in establishment of their franchise, since
Haldiram holds a long legacy of 80 years and is established across globe (it is widely accepted
across 23 countries including China, USA, Madagascar, Russia etc).
The second motivation to distributors lies in the fact that Haldiram’s products mainly sell because
of their food-quality and optimum taste, therefore they need not to invest in any hidden costs in
form of advertising or marketing.
What incentives are provided by Haldiram for its distributors? (distributor’s interview)
According to the distributor we interviewed, to Haldiram express retail outlet no rewards on
specific sales target nor targets given/provided.

REVIEW DISTRIBUTORS
Haldiram’s review their prospective dealers at various levels, firstly while registering they are
required to fill a basic form with information like-
 Name
 Contact number
 Email
 Address
 State and Zip
 Option to select investment type
 Option to select franchise variant
Basis on this information, Haldiram’s franchise provider’s customer support reviews each
distributor’s form and all shortlisted candidates are further advised and guided by them (franchise
provider’s customer support).
Once a dealer is all set to set up their dealership/ franchise, they are required to submit the
following documents to Haldiram, for further review and authenticity check-
 Property records –
Total property record with title and address
Lease agreement
No Objection Certificate (NOC)

 Personal records
Id proof (to prove citizenship)
Address proof (this is to ensure that one can apply for electricity bill, ration card etc.)
Other files (bank account with no passbook, photograph mail id, contact details etc.)
This step insures transparency and validity of the franchise. Once it is validated the
dealership/franchise is provided with a lease agreement of nine years.
How does it review distributors or franchisees performance?
According to the inputs provide by retailer and the distributor, the company review them on the
basis of their achievement of targets and the distribution process.
They take surveys on how frequently they have to order stock and took regular surveys on how well
is distribution going on and review distributors and stockist on the basis of that.

CASE STUDY OF CONFLICT

Ganga Bisan adopted the Haldiram’s trademark in 1941 for manufacturing of sweets, papads and
snakes. Later in 1972, the application was filled for India level trademark. For the flowing years the
business was handled by Moolchand (one of the Bisan’s son), who was handling operations
everywhere in India except West Bengal. While the ither son Mr. Rameshwar Lal was allowed to
handle operations of West Bengal, trademark allowance for the same was allotted in 1980.
After Mr. lal’s death, his sons threatened Mr. Moolchand’s sons to open a outlet in New-Delhi
under the same name. Displeased by the same Mr. Moolchand’s sons filled against the latter
seeking cancelation for Kolkata’s trademark allowance.
In 2013, Intellectual Property Appellate board (IPAB) ordered for removal of ‘trademark
registration’, which was passed in favour of Kolkata based- Haldiram bhujiawala. After then the
trademark was only accessible by Haldiram (India) Private Limited.
This action resolved the long- ended dispute between family members of Ganga Bisan (who
initially adopted the trademark). Favouring the Delhi based Haldiram plant, the board consisted of-
 Vice chairman S. Usha
 Member V. Ravi
They violated Kolkata Bhujiawala from utilization of Haldiram’s trademark on the ground of
‘insufficiency of documents and violation of Trade Marks Act’. They stated that Mr. lal’s sons were
unable to provide evidence for distinctiveness for the Kolkata’s trademark allowance.

EXPECTATIONS NOT FULFILLED

Requirements and qualifications for starting a Haldiram’s franchise
REQUIREMENTS
 Space/ Area requirement for setting up a Haldiram’s outlet would be around 75 – 100 sq ft.
 Documentation requirement: The documents required to run a Haldiram’s franchise would be:
GST registration
PAN and Aadhar card details
Standard franchise agreement
Copy of FSSAI certificate from Haldiram’s
QUALIFICATIONS
 To qualify as a franchise owner the required documents justifying the educational and
entrepreneurial background must be provided with.
 Moreover 2-3 employees with training, a prime location and basic management equipment
must be made available
Investment required to set up a Haldiram’s franchise
The investment required to set up a Haldiram’s kiosk franchise would be the lowest among the three
franchise options and details can be acquired after getting a Haldiram’s licensing only. Although,
Haldiram’s casual diner franchise requires an investment of ₹2-₹5 crores and
Haldiram’s quick service restaurant requires ₹1-₹2 crores
Out of all these, the maximum is fulfilled. Kiosks being more successful and satisfactory as the
investment is low and conditions are dilute and the quick service restaurants rank the second.
Fortunately, the basic expectations to start a franchise and the targets are not very heavy, so mostly
they are found to be fulfilled.

REFERENCES
 https://www.haldirams.com/
 https://www.thehindu.com/news/national/kolkatas-haldiram-bhujiawala-stripped-of-its-
trademark/article4658595.ece
 https://www.haldiramfranchises.com/
 https://www.franchiseindiaweb.in/haldiram-franchise/
 https://retailmarketing.co.in/haldiram-namkeen-sales-promotion-company-haldiram-
namkeen-cf-agents/
 https://retailmarketing.co.in/haldiram-namkeen-sales-promotion-company-haldiram-
namkeen-cf-agents/