Kirloskar Institute of Advanced Management Studies Sales & Distribution Management Assignment On Airtel ltd.

Submitted to: Prof. Bidyanand Jha Submitted by: Bhavani Devi (28)

Background of
Bharti Airtel Limited, commonly known as Airtel, is the largest Indian telecommunications company that operates in 20 countries across South Asia, Africa and the Channel Islands. It operates a GSM network in all countries, providing 2G, 3G and 4G services depending upon the country of operation. Airtel is the world's third-largest mobile telecommunications company with over 261 million subscribers across 20 countries as of August 2012. It is the largest cellular service provider in India, with 200.00 million subscribers as of 09 August 2012. Airtel is the third largest in-country mobile operator by subscriber base, behind China Mobile and China Unicom. Airtel is the largest provider of mobile telephony and second largest provider of fixed telephony in India, and is also a provider of broadband and subscription television services. It offers its telecom services under the Airtel brand, and is headed by Sunil Bharti Mittal.

Structure of their sales organization:

Chairman and managing director President

President mobile

President Enterprise

Director Customer Director customer Director legal and

Director supply chain Director marketing Director Human

Director Technology CFO and Director Airtel distribution channel: Airtel Company

Urban Distributor FSE Retailer

Rural Rural Super Rural distributor FSE Retailer

Sales manager of Bharti Airtel, Harihar (Mr. Pramodan): The facts gathered from him are: Airtel has 187 retailers in Harihar. They have 3 sales people in total. The Dealership is going on for the past 3 years. The manager of Harihar area was of the opinion that in case the company gives more margin to the retailer the sales increases. Plan Layout for the Harihar area:

Daily sales Per day recharge Revenue earned Targeted revenue Data driven by Incentives

1 lakh 1 lakh 30 lakhs (as of the month of july) 34 lakhs Company No incentives. (Margin fixed for the distributor)

Chart depicting the targets and achievements of the company for the month of July & August (2012)

July
MNP: 201 LSO (Lapu sales outlay, {Recharge}) : 180 SSO (Sim selling outlay): 110 Donguls: 17 ERC: 26 Lakhs PRC: 4 Lakhs Total: 30 lakhs PRC contribution: 14%

August
500 200

140 30 28 lakhs 6 lakhs 34 lakhs 20%

The Gross activation amounted to 3058 in the month of July and now the target is set for 2000 for the month of August.

Channel structure followed in Harihar:

Company

Distributor

Retailer

Consumer

Problems encountered: The problems normally encountered by the managers when dealing with the sales people is related to the documentation. The sales people normally dont check the documents submitted by the customers and send it to the manager. Ultimately, it is the manager who becomes answerable for this to the higher authorities. It was also witnessed by me when I went to meet him, a sales guy came to submit few document s to the manager and it was found that the sales guy had put the seal in the form without leaving space for the manager to put his signature. These kind of small problems generally arise between the manager and the sales guy.

One of the retailers of Bharti Airtel: Renuka Communications: This dealer started the operations in the year 2010. It is into the dealership of Airtel, Vodafone, Aircel, Reliance, Idea and Uninor. They are basically into the following businesses: Selling sim cards Recharging Mobile accessories

Sales during the initial years:

3

2.5

1.5

0.5

0 Quarter 1 2 3 4 5

X axis: Quarter Y axis: Sales (in lac)

Sales have been low for Renuka Communications in the initial 5 months for the following reasons: Incapability of attracting customers Lack of advertisements of the outlet Later, sales geared up for the following reasons: The outlet took advantage of the location and hence could attract the customers since the area is a commercial area Initially the outlet only focused on selling of SIM cards but later it also started selling mobile accessories which served the multiple needs of the customers.

External and internal factors that affect the sales cycle of Renuka communications: External factors: In the month of June and July the company faces low sales every year due to the AASHAD month. This is considered to be the month wherein people dont prefer purchasing. Internal factors: Lack of work force Network problems Issues among the distributors and retailers

Number of sales staff in Renuka communications: There is only one sales person involved who gets a remuneration of Rs. 25,000 per month.

Strategy & Sales style of the sales person followed:

The retail outlet basically follows the Personal selling sales strategy. In this strategy the outlet basically focuses on face to face selling to the customers by matching the benefits of their offering to the specific needs of the client.

It also follows the concept of relationship selling wherein it focuses on maintaining long term relationship with their customers even after sale of a product is done.

It follows the method of Trial offer at times wherein at the time any festive occasion or at the time of initial offering a free sim card is given as an offer.

Resources provided to the sales person: The sales person basically is given different mobile handsets for the different network connections.

Conflicts involved: At times, there is conflict between the distributor and the dealer. The reason behind this is: The dealer sends the information to the distributor regarding the amount of e-recharging to be done in currency terms and by evening the dealer is suppose to get the amount but at times there is delay in this process and as such this leads to the conflict. The customers also have grievances when their recharging is not done within proper time limit.

What was observed by me in their sales process? It was found that the outlet has number of multiple buyers. No kind of negotiation takes place with respect to the selling of sim cards, recharging, as well as selling of handsets because the price is fixed. They follow a planned call, i.e. the sales person gathers on an average the amount of recharging to be done in currency terms and call up the concerned distributor in the morning and he makes sure he receives the amount by evening.

Facts gathered in the entire process which was observed in Renuka communications: Per month the outlet does 1, 00,000 recharging amount in currency terms. The sales person achieves margin sales of 150 Sims per month. He does margin sales of Rs. 100; returns back Rs. 70 to the distributors and earn Rs. 30 as a profit. He purchases one Sim for Rs. 11. He makes only cash payment to dealers and also accepts only cash payment from customers. He makes a payment of Rs. 10,000 to Rs. 15,000 to the distributor every day. The Airtel recharge amounts to Rs. 2.5 per day for the outlet.

My understanding of the sales management practices followed: The sales officer generates weekly reports to the ASM (Area sales manager) this report consists of the area wise sales achieved in the particular territory of which the sales officer is assigned to. Through these reports the company can analyze which region has the highest sales and which region has the lowest sales. Accordingly the areas with weak sales are focused more for building up the brand preference of Airtel among the people. As far as recruitment process of the 3 sales people is concerned they are mainly recruited on the basis of the effective communication skills they have because one of the very important aspect to be considered when dealing with the retailer is the manner in which the sales person communicate with the distributor as well as the customer.

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