Marico is a large Indian Fast Moving Consumer Goods (FMCG) company established in the year 1991.
Their brand portfolios are embedded with renowned brands like Suffola, Parachute, Kaya Skin care etc...
Marico Supply Chain:
Stage 1: Marico receives raw materials from vendors.
Stage 2: These raw materials are processed in Plants
Stage 3: In this satge, Marico adopts two strategies
Strategy a) Move the slow moving Stock Keeping Units (SKU)'s and low volume products to RDCs
Strategy b) Move the final products to company depots
Stage 4: Primary sales
Strategy a) Send the goods to direct distributors
Strategy b) Send the goods to super distributors who in turn will send them to stockists.
Stage 5 : Secondary Sales
In this stage, both Direct distributors, and stockists send the goods to retailers.
E-procurement of Copra;
Copra procurement is a big challenge for Marico due to its vast geographical spread.The major markets includes Goa, Karnataka, Tamilnadu, and Andhra pradesh. Further,within Karnataka it has to procure from two big markets Managalore and Tiptur near Bengaluru. Similarly, In Kerala, the company has to source it from Kasargod, Kannur, Kozhikode, Malappuram and Thrissur. In line with the strategy, the company procured copra from Tamilnadu markets centers like Pollachi, Kangeyam, Dindigal, Tanjavore, and Vedarayam. The copra also procured from Ambajipeta in Andhrapradesh.
The challenges of Copra procurement are first, its an unorganized market and suppliers are not information technology Savvy. second, most of the suppliers were illiterate. Third, the volume of copra purchased was huge i.e. 20 lakhs copra per day which amounts to 2 copra per tree. Fourth, this 50% revenue earning product for the company has 25% of their terminal market in India.
The company identified two goals in setting up information technology infrastructure. The company intention was to adopt e- buying of copra and expand the existing vendor base and source it from new vendors and new places.Through these goals Marico wanted to have better price discovery and avoid brokers who were affecting the company margin.
When the company began its implementation plan, it understood that traditional processes adopted. In this method the company purchased he copra over the phone. There was huge delay in closing deals as negotiations used to take large time.This further affected the company price discovery and buying efficiency. In addition to this, traditional processes limited the coverage of suppliers and overlay on brokers.Thus, buying time was huge.
The company began the phased approach to implement e-procurement. In the stage 1 it made changes to physical buying processes. Later , it worked on Information Technology penetration. finally working on maturity of the process.
In this stage 1 the company modified its buying in sessions. It adopted 3* 1 hour model.It started asking the vendor to sell offers over the phone about the quantity and price. However, Marico had the control of buying. It can accept or reject the quote. To streamline the process, the company stopped negotiating the price with vendors.This has resulted in the change in the buying process by reducing time of negotiation.
In the second stage, the company began the process of opening email ids for vendors on Rediff, the email platform popular that time. Further, the company trained vendors to use emails.To facilitate this, Marico tied up with cyber cafes to educate vendors.These emails were used for sending gods receipt information, advance payment information, enabling debit and credit notes, and shipping notification for all dispatches.To execute the phase , the company tied up with banks those were having e-transfers at that time who can settle payments in 1 day. Thus, the supplier learning curve has improved.
In the final phase of implementation; he company developed copra portal e-marico.com. looking at he literacy levels of suppliers , content was developed in regional languages. In addition to this, the company rigorously trained suppliers Hence, supplier began utilizing portal for bidding along with email information. As a result of this, all transactions became paperless and all suppliers started utilizing e-portals. additionally, payments were done digitally.This stage also have to overcome obstacles such as vendor with less turnover, same cyber cafe used by multiple vendors for quoting the price and cyber cafe owner shared the information to other suppliers. This has forced Marico to eliminate use of cyber cafes and requested vendors to send quotes via SMS. Thus, the entire process was de-cartelisation.
The e-procurement system has numerous benefits. It has widened vendor base, reduced the broker dependency, buying efficiency has increased, and time for procurement reduced drastically
In this stage 1 the company modified its buying in sessions. It adopted 3* 1 hour model.It started asking the vendor to sell offers over the phone about the quantity and price. However, Marico had the control of buying. It can accept or reject the quote. To streamline the process, the company stopped negotiating the price with vendors.This has resulted in the change in the buying process by reducing time of negotiation.
In the second stage, the company began the process of opening email ids for vendors on Rediff, the email platform popular that time. Further, the company trained vendors to use emails.To facilitate this, Marico tied up with cyber cafes to educate vendors.These emails were used for sending gods receipt information, advance payment information, enabling debit and credit notes, and shipping notification for all dispatches.To execute the phase , the company tied up with banks those were having e-transfers at that time who can settle payments in 1 day. Thus, the supplier learning curve has improved.
In the final phase of implementation; he company developed copra portal e-marico.com. looking at he literacy levels of suppliers , content was developed in regional languages. In addition to this, the company rigorously trained suppliers Hence, supplier began utilizing portal for bidding along with email information. As a result of this, all transactions became paperless and all suppliers started utilizing e-portals. additionally, payments were done digitally.This stage also have to overcome obstacles such as vendor with less turnover, same cyber cafe used by multiple vendors for quoting the price and cyber cafe owner shared the information to other suppliers. This has forced Marico to eliminate use of cyber cafes and requested vendors to send quotes via SMS. Thus, the entire process was de-cartelisation.
The e-procurement system has numerous benefits. It has widened vendor base, reduced the broker dependency, buying efficiency has increased, and time for procurement reduced drastically
31 comments:
Jaya Chhapru
USN-2GI18MBA15
The Challenges Faced By Marico pertaining to IT Are As Follows
▪︎Small Vendors.
▪︎Cartel Formation
▪︎Cyber Cafe Owners Shares quotas /results .
▪︎Collusion of Suppliers at Cafes
2.Today With Expansion of Technology We can implement Following Steps .
▪︎Company's website or portal can be specially designed For Vendors .
▪︎Transactions by phone like e buying process that wont hamper deals and will not reveal the deal .
▪︎Quick Money Transfers
▪︎Customisation not only by language but also different prices different categories and benefits
▪︎Skype or Customer Care Support for any issues.
▪︎Databases help in efficiency like past sales or purchase records .
Karan Nilajkar
2GI18MBA18
challenges of IT implementation in Marico.
Forecast accuracy was at 70%.
Distributors were suffering stock-outs and loss of sales on 30% of Marico SKUs.
There are excess of inventory
The costs of errors in shipments to remote depots were mounting.
The penetration area with less than 20,000 population.
No secondary sales data is available.
Peak / Min Sales Ratio - across months
Skew of Sales with in a month
Data Visibility is a important challenge they have faced.
Order placement process due to implementation of new technology.
Distribution network complexity is more.
Assuming at current smart phone market, digital literacy, data connectivity, and regulatory environment, How you would have altered the solution?
I would like to altered the solution by prividing the best use of new technology and use of new methods.
Reduced sales skew and Balanced distribution levels
Decreased SKU stock outs by 50% so that we can move the stock fast
Reduced Excess Inventory at Distributors by 50% by tracking the record of inventory available at the distribution centers.
Reduced Marico’s Average Total Inventory by 25%
Reduced Supply Chain exception-handling costs by more than 60% by using a same software to from manufacture to retailer it will help to track record.
I would like to advertise and promote by using social media because that are effective now days.
Krupa Deshpande
2GI18MBA20
The challenges of IT Implementation in Marico
1. There is an excess inventory available
2. The complexity of distribution is more
3. The cost of errors in the shipments to the remote depots were mounting.
4. Secondary sales data was not available
5. There were min sales ratio across the month.
I would like to alter the solution by providing the best use of new technology and use the new method.
We can also reduce the excess inventory distribution by 50% by tracking thr old records
The challenges of IT Implementation in Marico
1. There is an excess inventory available
2. The complexity of distribution is more
3. The cost of errors in the shipments to the remote depots were mounting.
4. Secondary sales data was not available
5. There were min sales ratio across the month
I would like to alter the solution by providing the best use of new technology and use the new method.
We can also reduce the excess inventory distribution by 50% by tracking thr old records
Nitin Gahlot
2GI18MBA31
Challenges:
Cyber café started sharing quotes to vendors.
Educating the farmer to use their portal
Negotiation was consuming lots of time
Alternative
The company can set a particular executive who will be co-coordinating with the selected farmers. These farmers in return will help in contacting and getting the orders. The company can also think of helping the farmers in financing for their harvesting period this might help in negotiating a price bracket as the company builds goodwill amongst the farmers. As Kerala is the highest literate state in India, the app model should suffice for this particular state according to the stats.
Suchita Koujalagi
2GI18MBA51
1))Challenges faced are
1 Reduced sales skew and balanced distribution levels
2 Decreased SKU stockout by 50%
3 Reduced excess inverntory at distributors by 50%
4 Reduced Maricos avg total inventory by 25%
5Reduce supply chain exception handling cost
6 Increased funds for advertising, brand innovation and expansion
7Problem was no data storage system ,no forecasting
2) in the current situation of digital era its little easy to market our products
How yhe supply chain becomes flatter the farmet and the company wil be equally benefitted
They can aggregate the raw materials while procuring
They can save the data of the farmers and easily reach them.. Instead of email marketing they can use posters memes
Monika Patil
2GI18MBA25
Challenges of Marico
They did not have good data storage system.
They are more number of SKU s which couldn't Maintained properly.
Forecasting was not accurate.
Aggressive strategy.
They dnt have appropriate secondary data.
Copra was the major challenge to Marico.
More inventory.
Cost of errors were also more in shipment at rural areas.
2. As currently we have good IT support for maintaining the data, to analyse the data etc.
They should adopt the ERP to store the data of an organisation.
Employees should be trained on the usage of ERPs.
There are good softwares for forecasting , they need to make use of use application for accurate data forecasting.
Each stock keeping units should have a system to store data of the inventory inside.
Hire IT experts to solve such problems in data storage.
Megha Ingale
2GI18MBA24
1 challanges of IT implementation to marico:
*Not available of secondary sales data
*Data visibility is more
*Distribution network complexity
*Aggressive strategy
* Minimum monthly sales ratio
Vijayta kale
2GI18MBA57
1.What are challenges of IT implementation in Marico.
•The challenges of Copra procurement are first, its an unorganized market and suppliers are not information technology Savvy.
•most of the suppliers were illiterate.
•the volume of copra purchased was huge i.e. 20 lakhs copra per day which amounts to 2 copra per tree.
•50% revenue earning product for the company has 25% of their terminal market in India.
•There was huge delay in closing deals as negotiations used to take large time.This further affected the company price discovery and buying efficiency
•traditional processes limited the coverage of suppliers and overlay on brokers.Thus, buying time was huge.
•Marico wanted to have better price discovery and avoid brokers who were affecting the company margin.
2.Assuming at current smart phone market, digital literacy, data connectivity, and regulatory environment, How you would have altered the solution?
•money transfers and e-payments
•should reduce excessive inventory distribution
•promotions through social media platforms.
•. The company intention was to adopt e- buying of copra and expand the existing vendor base and source it from new vendors and new places.
•The company identified two goals in setting up information technology infrastructure.
•elimination of cyber cafe for offers.
•de-cartilization.
•result of offers communication through SMS
Akshata Shiroshi
2GI18MBA06
challenges -
1)unorganized market and suppliers are not information technology Savvy.
2) most of the suppliers were illiterate.
3) the volume of copra purchased was huge i.e. 20 lakhs copra per day which amounts to 2 copra per tree.
4)this 50% revenue earning product for the company has 25% of their terminal market in India.
solution -
1)Collection centres, to
motivate small scale farmers to
stay active in the market and
keep away.
2)IT and telecom platforms for effective communication with farmers.
3)conducting productivity program
4)mobilising and channelising the cluster activities for delivering targeted productivity improvements.
Abhish kamat
2GI18MBA01
The challenges of IT Implementation in Marico
1. There is an excess inventory available
2. The complexity of distribution is more
3. The cost of errors in the shipments to the remote depots were mounting.
4. Secondary sales data was not available
5. There were min sales ratio across the month.
The alternative can be
The company can set a particular executive who will be co-coordinating with the selected farmers. These farmers in return will help in contacting and getting the orders. The company can also think of helping the farmers in financing for their harvesting period this might help in negotiating a price bracket as the company builds goodwill amongst the farmers. As Kerala is the highest literate state in India, the app model should suffice for this particular state according to the stats.
Nivedita kadam
2GI18MBA32
The challenges of IT Implementation in Marico
1. Penetrate areas with less than 20000 population
2. No secondary sales data
3. Minimum sales ratio across month
4. Skew of sales within month
5. Order placent process
6. Distribution network complexity
Solutions
1. Reduce excess inventory at distribution of 50%
2. Reduce meri is average total inventory by 25%
3. Reduced SKU stock outs by 50%
4. Reduced sales skew and balanced distribution levels.
Sonali sheth
2GI18MBA50
challenges:
*They have Aggressive strategy
*More brands and more products will incur huge costs.
*The distribution network became more costly and complex, exposing many process inefficiencies.
* There were shortcomings in its forecasting, planning, and supply chain processes.
*Penetrate areas with less than 20, 000 population.
*No secondary sales data.
* difficulty for small vendors
2) *Implementing New technology and new methods.
*proper planning and distribution
*banking system for money transfer.
*Advertisement and promotion are the platform in social media because that are effective now days.
*We can also reduce the excess inventory distribution by 50% by tracking there old records.
Vinita Kadam
2GI18MBA58
Challenges of IT implementation
* Forecast accuracy was 70%
* No secondary sales data
* The distribution network was more costly and complex
* Data visibility
* Distribution network complexity
Solution
* Integrating all the transactions and data and making it clearly visible through authenticated access
* forecasting by Delphi method or market research to get accurate data
* Maintaining secondary sales data for further forecasting
Rohan J Shanbhag
USN - 2GI18MBA42
Challenges faced are:
1. There is excess of inventory.
2. Secondary data was not available.
3. It was difficult to educate the farmers about the portal.
4. Negotiation was consuming more time.
5. The sales was minimum across the month.
6. There was lots of complexity in the distribution network.
Shweta uttam
2GI18MBA49
1))Challenges faced are
1 Reduced sales skew and balanced distribution levels
2 Decreased SKU stockout by 50%
3 Reduced excess inverntory at distributors by 50%
4 Reduced Maricos avg total inventory by 25%
5 Problem was no data storage system ,no forecasting
6 Cyber café started sharing quotes to vendors.
7 Educating the farmer to use their portal Negotiation was consuming lots of time
2) in the current situation of digital era its little easy to market our products
How yhe supply chain becomes flatter the farmet and the company wil be equally benefitted
The company can set a particular executive who will be co-coordinating with the selected farmers. These farmers in return will help in contacting and getting the orders. The company can also think of helping the farmers in financing for their harvesting period this might help in negotiating a price bracket as the company builds goodwill amongst the farmers. As Kerala is the highest literate state in India, the app model should suffice for this particular state according to the stats.
Apoorva karva
2GI18MBA08
Challenges:
1. Aggressive strategy
2. More forecast to make
3. More production to plan
4. Forecast accuracy was at 70%
5. Distributors were suffering stuck-out and loss of sales on 30% of Marico.
6.The cost errors in shipments to remote depots were mounting.
7. Most of the suppliers were illiterate.
2.Assuming at current smart phone market, digital literacy, data connectivity, and regulatory environment, How you would have altered the solution?
1. Best use of new technology.
2. Reduced Excess Inventory by 50%.
3. Advertise and promote through social media
4. The company can help farmers in financing for harvesting so there can be negotiation.
Akshata N
2GI18MBA05
1. Challenges of IT implementation in Marico :
* Excess inventory
* Forecast accuracy was at 70%
* Distributors were suffering stock out and loss of sales on 30% of marico Sky's
* Distribution network complexity
* Small vendors
* Cost of errors in shipment.
* Data Visibility
* No secondary sales data
* Order placement process
2. I would like to alter the solution by providing best technique and using new methods
* Quick money transfer
* Reducing marick average total inventory by 30%
* Expanding conceptions of digital world
* Reducing sales skew and balanced distribution level
I would like to advertise in Google ads and other social media because most of people use social media it will easily reach customers.
Jayatirtha Gumaste
2GI18MBA16
Challenges of IT systems implementation in Marico:
Forecast accuracy was at 70%.
Distributors were suffering stock-outs and loss of sales on 30% of Marico SKUs.
There are excess of inventory
The costs of errors in shipments to remote depots were mounting.
The penetration area with less than 20,000 population.
No secondary sales data is available.
Peak / Min Sales Ratio - across months
Skew of Sales with in a month.
Data Visibility is a important challenge they have faced.
Order placement process due to implementation of new technology.
Distribution network complexity is more.
Solution:-
Need to make data availability on single platform.
Reduced SKU stock outs by 50% .
Reduced sales skew and balanced distribution levels.
Kanchan D
2GI18MBA17
1. Data visibility
2. Distribution network complexity
3. Order placement process
4. Understanding ans anticipating customer needs
5. Developing products and packaging innovation to meet those needs
6. Aggressive strategy
7. More brands and more products incur costs this entails more sales and market to track
8. Forecast accuracy was at 70%
Firdous Mohammed
USN 2GI18MBA12
Challenges faced are
1. Reduced sales
2. No forecasting or data storage system
3. More cost of errors
4. Inaccurate supply chain
5. Excessive inventory
6. Secondary sales data wasn't there
Alternatives
1. Hiring IT professionals for the better work
2. Secondary data research is necessary
3. Money transferring Applications like Gpay , paytm must be initiated
4. Ads and promotions must depend more on the social media
Segregation of categories and prices should be more organized and appropriate
Challenges
* There was no proper forecasting because of unorganised sector
* Forecasting accuracy is 70%
* Sales were low throughout the month
*To educate the suppliers
*There were no transparency of warehouse stocks
*Sales data wasn't propelyp available
*The distribution network is more costly and has complexity
Neha Khemalapure
2GI18MBA28
1. Penetrate areas with less than 20000 population
2. No secondary sales data
3. Minimum sales ratio across month
4. Skew of sales within month
5. Order placent process
6. Distribution network complexity
Usn -2GI18MBA07
Amol M
Challenges
* There was no proper forecasting because of unorganised sector
* Forecasting accuracy is 70%
* Sales were low throughout the month
*To educate the suppliers
*There were no transparency of warehouse stocks
*secondary Sales data was not available
*The distribution network is more costly and has complexity
Pooja G
2GI18MBA34
Challenges faced by Mari co
1. Forecast accuracy was 70%
2.Excess inventory
3.distribution network became more costly and complex
4.no secondary sales data
5.data visibility
2: In this situation IT played important role to build a best solutions by providing new technology.
Using good software to forecast accurate data and also,Its controls excess inventory and cost by this software.
Kusum shidling
USN 2GI18MBA21
Challenges:
1. Less and small number of vendors
2. Distribution network complexity is more.
3. Proper Sales data was nt avalible
4. Aggressive statergy
5. Suppliers were illiterate.
Solution:
1.communication through SMS
2.Special portal should be designed for vendor's
3. The past data can help.
4. elimination of cyber cafe for offers.
5. de-cartilization.
6. Result of offers
Vittal SB
2GI18MBA59
1 challanges of IT implementation to marico:
*Not available of secondary sales data
*Data visibility is more
*Distribution network complexity
*Aggressive strategy
* Minimum monthly sales ratio
PRAJWAL.B.G.
(2GI18MBA37)
challenges of IT implementation in Marico.
Forecast accuracy was at 70%.
Distributors were suffering stock-outs and loss of sales on 30% of Marico SKUs.
There are excess of inventory
The costs of errors in shipments to remote depots were mounting.
The penetration area with less than 20,000 population.
No secondary sales data is available.
Peak / Min Sales Ratio - across months
Skew of Sales with in a month
Data Visibility is a important challenge they have faced.
Order placement process due to implementation of new technology.
Distribution network complexity is more.
Assuming at current smart phone market, digital literacy, data connectivity, and regulatory environment, How you would have altered the solution?
I would like to altered the solution by prividing the best use of new technology and use of new methods.
Reduced sales skew and Balanced distribution levels
Decreased SKU stock outs by 50% so that we can move the stock fast
Reduced Excess Inventory at Distributors by 50% by tracking the record of inventory available at the distribution centers.
Reduced Marico’s Average Total Inventory by 25%
Reduced Supply Chain exception-handling costs by more than 60% by using a same software to from manufacture to retailer it will help to track record.
I would like to advertise and promote by using social media because that are effective now days.
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