SALES MANAGEMENT REPORT

TERRITORY MANAGEMENT AT YOUNGS FOODS

SUBMITTED TO:
Mr. Saeed Ur Rahman Instructor, Sales Management IoBM, Institute of Business Management

SUBMITTED BY:
Omer Mohammad Khan 9809 Hafiz Owais Syed Bilal Abir Haider Wajahat Ali

April 23, 2012

TERRITORY MANAGEMENT AT YOUNGS FOODS

Table of Contents
LETTER OF AUTHORIZATION ......................................................................................................................... 3 LETTER OF TRANSMITTAL ............................................................................................................................. 4 ACKNOWLEDGEMENT ................................................................................................................................... 5 INTRODUCTION ............................................................................................................................................. 6 CORPORATE PHILOSPHY ........................................................................................................................... 6 CORE VALUES ............................................................................................................................................ 6 VISION ....................................................................................................................................................... 6 MISSION STATEMENT ............................................................................................................................... 6 TERRITORY MANAGEMNT AT YOUNGS FOODS ........................................................................................... 7 1. 2. 3. Direct Modern Trade (DMT): ............................................................................................................ 7 Local Modern Trade (LMT):............................................................................................................... 7 General Trade (GT):........................................................................................................................... 7

SALES HIERARCHY ......................................................................................................................................... 8 BASIS FOR TERRITORY DESIGN ...................................................................................................................... 9 GEOGRAPHICAL TERRITORIES: .................................................................................................................. 9 TERRITORY DIVISION IN SOUTH ZONE: ................................................................................................... 10 Servicing Required + Geographic: ....................................................................................................... 10 CHANNEL HEADS ..................................................................................................................................... 11 METHODS OF DESIGNING TERRITORIES ..................................................................................................... 11 METHODS FOR ROUTING ............................................................................................................................ 12 FORECASTING OF SALES .............................................................................................................................. 12 PERFORMANCE EVALUATION ..................................................................................................................... 13 CRITICAL ANALYSIS ...................................................................................................................................... 14 QUESTIONAIRRE .......................................................................................................................................... 15

TERRITORY MANAGEMENT AT YOUNGS FOODS

LETTER OF AUTHORIZATION

April 23, 2012

Dear Readers,

As students of BBA Honors; Mr.Saeed Ur Rahman Course Instructor for Sales Management has authorized us to prepare a report on the Territory Management at Youngs foods. The requirement is to conduct a primary research based on interview with the RSM or ASM at any FMCG to inquire the basic practices of territory management that are being implemented in the organization. This research is conducted by an interview with the Area Sales Manager of Youngs Foods.

The report is required to be submitted on April 23, 2012.

Sincerely,

Omer Mohammad Khan Hafiz Owais Syed Bilal Abir Haider Wajahat Ali

TERRITORY MANAGEMENT AT YOUNGS FOODS

LETTER OF TRANSMITTAL

April 23, 2012

Mr. Saeed Ur Rahman Professor, Sales Management Institute of Business Management

Dear Sir, Here is the report, authorized on Territory Management at Youngs food. In this report we have come up with an introduction about Youngs foods followed by the details about the territory management, sales hierarchy, territory division and different methods and procedures that Youngs foods uses to manage its territories. The research focuses on the main practices of territory management that are followed at Youngs foods and also a critical analysis of their practices and recommendation as to what could be done to improve the territory management at Youngs foods. I hope that this report is helpful in your assessment of Territory Management in FMCG Industry. This research paper conveys our feelings about the subject, and we have researched the topic to the best of our abilities. For any further queries contact us at 03212015101 or email us at Std_9809@iobm.edu.pk.

Sincerely,

Omer Mohammad Khan Hafiz Owais Syed Bilal Abir Haider Wajahat Ali

TERRITORY MANAGEMENT AT YOUNGS FOODS

ACKNOWLEDGEMENT

I would first like to thank Almighty Allah for giving me the strength and endowing me with the privilege of completing our term report on the topic of Territory Management at Youngs foods. I am also extremely thankful to my mentor and guide Mr. Saeed Ur Rahman whose help, suggestions and encouragement helped me during the time of research and in the making of this report. I have learnt a lot of new things while preparing this report and found it to be very interesting.

Thank you,

Omer Mohammad Khan Hafiz Owais Syed Bilal Abir Haider Wajahat Ali

TERRITORY MANAGEMENT AT YOUNGS FOODS

INTRODUCTION
The house of Youngs started its operations in 1988 as a food processing establishment. The first product launched by Youngs was Mayonnaise that received tremendous acceptance and appreciation. Another milestone in spread category is Youngs Chicken Spread; the first ever commercially produced in 1989. This journey of successful launches continued with Sandwich Spread, Chocolate Spread, Olive Spread, Pizza Spread and recently launched Mayo Garlic. Youngs Natural Honey is also playing a significant role in Youngs Family. Today, Youngs enjoys tremendous Brand Leadership in Mayonnaise and Spreads category through out Pakistan with presence in various global markets.

CORPORATE PHILOSPHY
The corporate philosophy of Youngs is based on stronger believe that all the benefits come from the Creator of whole Universe *Allah*. At Youngs, we believe that our organization is responsible to our Creator, our people and our business partners.

CORE VALUES
1. Pleasing Allah 2. Responsive to Stakeholders 3. Mushawrat 4. Excellence 5. Improvement and Innovation

VISION
We will, Insha'Allah, be a brand of choice for consumers seeking Halal and Convenient food products in the Global Halal Food Market. We will achieve this vision by continuously giving our customers true value for their money, developing our people, improving the way we work and thus developing a business model of excellence.

MISSION STATEMENT
At Young's, our mission is to provide our customers Halal, Hygienic, Healthy, Nutritional, and Convenient food products; through our customer driven and service oriented dynamic team. We strive to do business in accordance with the Islamic Guidance and to develop a business model of excellence.

TERRITORY MANAGEMENT AT YOUNGS FOODS

TERRITORY MANAGEMNT AT YOUNGS FOODS

Youngs Foods has divided its whole market into 4 channels based on which they distribute their goods in the market. Territories are formed on the basis of these categories which are mentioned below; each category is assigned to different distributors except for Direct Modern Trade (DMT). 1. Direct Modern Trade (DMT): It includes all the Direct key accounts. e.g- Makro, Metro, Hyperstar etc. It also includes Utility Store Corporation (USC) and Canteen Store Department (CSD) and all those outlets which operate internationally. In DMT, the company directly delivers the good because these are the Direct Key Accounts of the company. Highly experienced sales personnel and mostly the sales managers are the ones who deal with the DMT. 2. Local Modern Trade (LMT): It includes all large key accounts e.g- Naheed, Imtiaz and Chase etc. And all those outlets which operate locally. 3. General Trade (GT): This category includes all small wholesale and retailers, bakeries, medical stores. 4. Food Service Division (FSD): This category includes all hotels, restaurants, hospitals etc.
YOUNGS PRIVATE LTD

OUTSOURCED DISTRIBUTION

DIRECT MODERN TRADE

GENERAL TRADE

FOOD SERVICE DIVISION

LOCAL MODERN TRADE

TERRITORY MANAGEMENT AT YOUNGS FOODS

SALES HIERARCHY
At Youngs food they follow a vertical chain of command as illustrated below:

CEO

Director

GM

NSM

South zone

Central zone

Lahore zone

Pindi zone

ASM Karachi (GT)

ASM Karachi (DMT,FSD, LMT)

TM DMT

TM FSD

TM LMT

TM GT1

TM GT2

TM GT3

TM GT4

TM GT5

TERRITORY MANAGEMENT AT YOUNGS FOODS

BASIS FOR TERRITORY DESIGN

GEOGRAPHICAL TERRITORIES:
At Youngs Foods the territories are divided on geographical basis. Youngs operate all over Pakistan. The whole country is divided into four zones : South zone which includes Karachi, Hyderabad, Sukkhar, Quetta it also caters Baluchistan, Central zone which includes Multan, Faislabad ,lower Punjab, Lahore zone which include Lahore to Jhelum and northern Punjab, Pindi zone which includes Islamabad Peshawar and northern areas of Pakistan .in every zone there are one base station in which at least two territory managers are assigned and many non base stations/outstations.

PAKISTAN

SOUTH ZONE

CENTRAL ZONE

LAHORE ZONE

PINDI ZONE

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TERRITORY DIVISION IN SOUTH ZONE:

Servicing Required + Geographic:

In the south zone, Karachi is further divided into eight territories based on the Servicing Required. Each territory has its own territory manager and a distributor. LMT, DMT and FSD are different territories on the basis of account types While General Trade (GT) is on geographical basis. Each territory manager has Order Bookers and Merchandisers. The job of the Order booker is to take orders, they work like sales reps. While on the other hand the job of the merchandisers is to check and ensure the availability of the product at the outlets. Each order booker has to visit 50 outlets per day on average and 300 outlets per week.

KARACHI (AREA SALES MANAGER)

LMT

DMT

FSD

GT1

GT2

GT3

GT4

GT5

OB

MERCHANDISER

The same pattern of territory division is followed throughout the other zones all over Pakistan.

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CHANNEL HEADS
The Channel heads are the heads of each channel and they work parallel to zonal managers. Their primary job is to provide technical and strategic assistance to zonal managers. For example: trade offers or discount schemes are provided by the Channel Heads. They are at the same hierarchy level as zonal Managers. They report directly to national sales managers. Each channel head their respective provided by national sales manager

GM

NSM

DMT/LMT Channel head

GT Channel head

FSD Channel head

Outstation Channel head

METHODS OF DESIGNING TERRITORIES

Youngs food uses a Build up method for designing its territories. The territories are formed by creating units that provide sufficient sales challenges. Based on that individual volumes are assessed and call frequencies are determined.

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METHODS FOR ROUTING

Youngs food uses a Cloverleaf method for routing. In this method a base town is set then its surrounding areas are covered.

FORECASTING OF SALES
Annual sales targets are forecasted by zonal and channel managers based on previous sales trend and market conditions. They set targets for metropolitan, non-metropolitan and outstation areas which are then communicated to national sales manager General manager, national sales manger, brand manager and operation manager develop strategies for the next year sales based on over all market conditions, market share, sales potential, budgets, production capacity, consumer insight and keeping in mind the growth trend as well. These strategies are then conveyed to zonal and channel mangers. The Zonal or channels managers sets target for different zones, based of different cities and channels. This target is then communicated to National Sales Manager and General Manager who then covey it to the area manager who then divides the target based on geographically demand of product. National sales manager, general manager and brand managers makes their own target and compare it with the actual target, if the targets match than there is no problem but if the targets do not match then they go back to strategy development step where they plan and evaluate the problem and determine the reason behind it.

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PERFORMANCE EVALUATION
Company does performance evaluation on the basis of primary sales and secondary sales. Primary sales are those made by company to the distributor and Secondary sales are those made by the distributor to retailer. Performance evaluation is done in these four ways: Stock outs (Inventory Turnover): Number of days when distributor runs out of stock. Order booking v/s execution: how much orders were booked and how much executed properly For Example- If 50 orders were placed and only 40 were executed properly it means that 80% performance were achieved. Call Productivity: Percentage of outlets who gave order. Administrative and other evaluation.

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CRITICAL ANALYSIS

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QUESTIONAIRRE
1. On what basis do you territories? Geography? Potential? Servicing required (based on ABCD category)? Or workload (Rural area/urban area)? 2. Which method is used to design territories? Build up method? Break down method? Incremental method? 3. Which routing method is used? Straight line? Cloverleaf? Hopscotch? 4. Number of accounts in each territory? 5. Number of sales calls made to each customer in a month? 6. Time required for each sales call? 7. Frequency of sales call? 8. What type of reporting system? 9. Who does sales rep report to? 10. Who deals key accounts? 11. Who are your major/large accounts? 12. Who forms territories? 13. Is there different credit policy for key accounts? How is it different? 14. Is distribution different for key accounts? How is it different? 15. Is the pricing different for key accounts? How is it different? 16. Is product design different for key accounts? How is it different? 17. Details of territories in Karachi? 18. Who allocates quota for sales rep? 19. Are sales rep provided with Cars / Bikes? 20. Are they given fuel allowance? 21. What other allowances are given? 22. How is evaluation of sales rep performance done? 23. Is there any overlapping of territories? 24. Average Travel time? 25. Non selling time? 26. Return on time invested? 27. Chain of command? 28. Communication channel? 29. Sales automation? 30. Level of authority of sales rep?