SUMMER TRAINING PROJECT REPORTON

“MANCHITRA”

(DISTRIBUTION CHANNEL & RETAIL EXPANSION)

HARIDWAR REGION ( DEHRADUN )

FOR

FOR THE PARTIAL FULFILLMENT OF ACCOMPLISHMENT OF MASTER’S DEGREE IN BUSINESS ADMINISTRATION

INSTITUTE OF MANAGEMENT STUDIES,DEHRADUN

SUBMITTED BY:-

MR. ABHISHEK KISHORE M.B.A. III SEMESTER ID-MB04047 SESSION-2004-06 IMS DEHRADUN

ACKNOWLEDGEMENT

I would like to extend my sincere thanks to my project guide Mr. Vineet jain D.G.M. AirTeL, UTTARANCHAL for his valuable guidance and support that helped me to successfully complete the project. His kind support and guidance is highly appreciable for the successful completion of the project.

I would like to thanks Mr.Vinay Garg, Z.S.M. and Mr. Rohit kalra, T.S.M. Haridwar for providing me with valuable inputs during the project.

I would also like to take the opportunity to thank Mr. sunil arora (Distributor,postpaid) Haridwar and his FSO’s for their support and valuable knowledge and experience that made the task look easier.

Last but not least I would like to thank AirTel for providing us with all the required resources for the project and the office boys who were very kind to us.

Abhishek Kishore

CONTENTS

1. Acknowledgement

2. Contents

3. Executive Summary

4. Industry Profilea. History of Indian Telecom Sectorb. Market share of mobile subscribersc. GSM subscribers

5. Company Profile

6. a. AirTel vision and missionb. U.P. west networkc. Eventsd. Organization structuree. Status Vis a Vis Company

7. About Project Manchitra & retail expansion

8. Objective

9. Methodology

10. Review of Literaturea. Distribution Networkb. Marketing Agentsc. Products

11. Key Learning

12. Bibliography

EXECUTIVE SUMMARY

AirTel is one of the leading mobile service provider’s in the field of telecommunication in the country. AirTel has presence over 21 circles in the country.

The major competitors of AirTel are IDEA, HUTCH and BSNL in GSM and TATA and RELIANCE in CDMA.

It is the leading mobole service with over 10 million customers.

The summer project was in the UP (west) or UTTARANCHAL Zone.

The area allocated was haridwar

The project provides with the insight of the distribution channel of AirTel in the region.

The project was divided into two parts : 1. Market Mapping 2. Retail Expansion

During market mapping a survey was conducted to know the actual number of shops who were selling AirTel Magic prepaid card. In Market Mapping each lane and bylines were covered with the major adjoining areas, which came under Haridwar Distt. In this the retailers who were selling AirTel were interviewed and their problems were looked into

and solutions were thought of for the problems. Moving around in the market made us know the length and breadth of the city and had given us a bit of knowledge about the environment and it also helped us in the second part of the project that was retail expansion.

In the second part we moved on to the retail expansion practice. In this each and every outlet in Haridwar was contacted and leads were

Generated and efforts were made to convert the leads into end customers for the company.

During this part of time we were familiar the area. It was during the second point we came to know the actual between recommending something and putting the recommendation into practice. It was during the first phase we had recommended many things and thought that we had given the best of the advices but actually it turned out to be the opposite.

The entire project was a great learning experience. After going into the market and staying there for a period of 60 days came to know about all the intricacies of the Distribution network of AirTel.

During the process I came to know what were the problems that AirTel was facing in the region and what could be the best possible solution for the problems.A Detailed SWOT analysis of the areas and the city as a whole helped in the analytical part development. There was an exposure to the preparing of schemes for retailers.

INDUSTRY PROFILE

INTRODUCTION

Technological changes in the telecom and computers have radically changed the business scenario. In turn, the new demand of business have spurred many telecom based technological innovations. In order to exploit these innovations for competing in global market, business community the world over has been putting pressure on governments to revise the policy, regulation and structure of the telecom sector. Several countries across the world have respond by restructing the state controlled telecom service provider, increasing private participation, and deregulating service provision. The emergent organizations have attempted to be more responsive to the business needs and have evolved mechanisms to remain competitive even under tremendous pressures.

Over the past several years, developing countries have also recognized the important role a responsive, business oriented and technologically advanced telecom sector plays in the growth of the economy. Many developing countries now accept the limitations of a monolith state monopoly in responding to the twin challenges of spurring internal growth and competing in an increasingly global economy.

Past experience of reform across many countries suggests that the fundamental underlying issue that must be addressed in telecom reform is introduction of competition for efficiency. Competition is considered to be an important factor than ownership in introducing efficiency.

India’s 21.59 million-line telephone network is one of the largest in the world and the 3rd largest among emerging economics (after China and Republic of Korea). Given the low telephone penetration ratio India offers vast scope for growth. It is therefore not surprising that India has one of the fastest growing telecommunication system in the world with system size (total connections) growing at an average of more than 20 percent over the last 4 years.

The industry is considered as having the highest potential for investment in India. The growth in demand for telecom services in India is not limited to basic telephone services. India has witnessed rapid growth in cellular, radio paging, vale-added services. This is expected to soar in the next few years.

Recognizing that the telecom sector is one of the prime movers of the economy, the Government’s regulatory and policy initiatives have also been directed towards establishing a world-class telecommunications infrastructure in India. The telecom sector in India therefore offers an ideal environment for investment.

The telecommunication initiative in the country is lead by Ministry of Communication through the department of Telecommunication &

Department Telecom Services and its undertaking for provision of basic telephone services, national and international long distance communication, manufacture of complete range of telecom equipment, research and development, and consultancy services. The Telecom Commission performs the Executive and Policy making function. The Telecom Regulatory Authority of India performs the function of an independent regulatory body.

SERVICES OFFERED

Telephone Services, NSD/ISD Services, Computerized Trunk Services, Pay Phone, National & International Leased Lines Circuits, Telex, Telegraph Services (Manual & Automatic), X-25 based Packet Switched Data Network (INET), Gateway Packet Switched Data Services (GPSS) Gateway Electronic Data Interchange Service (GEDIS),Gateway E-mail and store & Forward FAX Services (GEMS-400), Concert Packet Services (CPS), Satellite-based Remote Area Business Message Network, Electronic Mail, Voice Mail, Audio-Text, Radio Paging, Cellular Mobile Telephone, Public Mobile Radio Trunked Services, Video-Tex, Video Conferencing, V-SAT, Internet, ISDN, INMARSAT Mobile Service, INMARSAT Data Service, Home Country Direct Service, Intelligent Network (IN) Services.

History of Indian Telecom Sector

Telecom sector was a state monopoly until the eighties when the liberalization process started. The department of telecommunication (DoT), under the Ministry of Communication administered telecom services. The planning commission, an apex level body, allocated funds for telecom development from government resources. The telecom sector, therefore, competed with other development priorities of the

government for a share in resource allocation. Planning , engineering ,installation, maintenance, management, and operation of telecom services for the whole of India was managed by the DoT ,which also lay down and monitored adherence to technical standard and managed frequency usage .

The DoT was a monolithic entity, which a huge workforce managing the telecom operation of the entire country. The bureaucratic approach and the slow acceptance and induction of new technology with very little customer orientation were perceived a s barriers to growth .

Consequently two new public sector corporation –Mahanagar Telephone Nigam Limnted (MTNL) and Videsh Sanchar Nigam Limted (VSNL)—were set up under the DoT. MTNL was carved out of the DoT and took over the operation, maintenance and development of telecom services in Mumbai and New Delhi.

VSNL was set to plan, operate, develop, and accelerate international telecom service in India. The government created the corporate organization in order to allow decision-making autonomy and flexibility and facility public borrowings, which would not have been possible under a government framework. However, policy formulation, regulation and several key decision areas remained with the DoT.

A new organization, the telecom commission, was created with a wide range of executive administrative and financial power to formulate and regulate policy and prepare the budget for the DoT. The telecom commission had four full time members managing technology, production, services, and finance and four part time members representing the planning commission, department of finance, department of industry, and department of electronics.

The key driver for change in the sector was the national telecom policy announced in my 1994. It boldly specified its major objective as telephone on demand, achievement of universal services obligation and ensuring world class services to subscribers. This policy also paved the way for private sector participation in telecom services. Objective of NTP (1994) were

Telecom for all and telephone in reach of all Provision for certain basic telecom service at affordable and

reasonable price World class quality of telecom services India to emerge as a major manufacturing base and exporter fof

telecom equipment.

Telecom services were categorized into domestic basic (which included basic telephony, telex and fax), domestic value-added services (VAS), which covered all other services such as paging, cellular, data services, VSAT and international basic and VAS. Telecom services liberalization stared in 1984, with private sector being allowed to manufacture customer premise equipment.

In 1992, services provision was opened for private sector. A this stage government also unbundled basic and VAS. Private operators were allowed to participate in provision of VAS such as cellular and paging services. Subsequently, basic services in the local loop were opened for private operators. Basic services provision had been planned as a duopoly between the DoT and a selected service provider. Several services providers, one for each of the twenty “circles” into which the entire country had been divided would compete with the DoT for basic for basic services. The bidders were evaluated both on financial and technical parameters. Permissible network technologies were specified and basic service providers were required to base their services on fiber-optic cable and wireless in the local loop as far as possible.

Licenses had been granted for an initial period of 15 years and could be extended by another 10 years. Private Service operations were allocated to provide intra-circle long distance service, which contributed to almost 60% of the total calls.

The government had mandated that all private basic services operations had to provide 10% of all new lines in rural areas. A weight age of 15% for service provision in rural areas was given at the time of bid selection. A penalty on a per day basic for each telephone not installed sought to prevent companies from delaying meeting rural target. At the same time, the government encouraged new emerging technologies including local loop wireless, cellular telephony and satellite based communication system that could help develops rural telecom in a cost effective manner.

Inter-circle communication remained under the DoT. VSNL maintained an exclusive license for international services for at least until 2004. Advanced communication services like cellular, paging, email, fax; private operators were increasingly making data transmission over telephone and leased circuits available. However, Electronic Data Interchange standards and its adoption had not made much progress largely due to the problem in long distance communication, lack of coordination for adopting standards, and unclear polices in the various departments involved in national implementation.

HIGHLIGHTS

The telecom muddle is growing murkier and murkier by the day. In addition, so are the claims of the great Indian telecom revolution.

5th largest network in the world, second largest among emerging economies (after China).

Annual growth rate of 22% in basic telephone service and over 100% for cellular and Internet services.

Private participation allowed in all types of telecom and IT enabled services. License granted on non-exclusive basis for basic, national long distance, international long distance, Internet, V-Sat service, etc.

Foreign equity participation permitted in the telecom service sector.

Huge market for all types of telecom equipments for both wire line and wireless, Internet, radio trunking, call centers, etc.

Foreign direct investment of up to 100% permitted for the manufacturing of telecom equipment.

Investments potential across a wide spectrum of telecom service.

STRONG GROWTH CONTINUES

Growth in telephony continued in May as the subscriber base reached the 102.5mn mark. Teledensity in May 2005 improved to 9.46% from 9.26% in April 2005.During May 2005, 2.31mn subscribers were added as against 2.03mn subscribers in April 2005. In the fixed segment, a total of 0.61mn subscribers were added during May 2005, taking the subscriber base of fixed line services to

47.11mn. In the mobile segment, total additions during the month summed up to 1.7mn out of which 1.225mn subscribers were added in the GSM segment and the remaining 0.475mn were added in the CDMA segment.

Mobile telephone subscriber base witnessed a healthy growth of 1.7mn in May 2005, a strong to the new financial year. The segment subscriber base grew 3.22% mom to 55.38mn. Bharti remained the overall market leader in both the CDMA and the GSM segments.

COMPANY CIRCLESAircel Digilink India Limited

Haryana, Rajasthan,U.P (East)

Aircel Limited Chennai, Tamil NaduBharti Cellular Limited.

Delhi (Metro), Mumbai (Metro), Kolkata (Metro), Chennai (Metro), Andhra Pradesh, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Karnataka, Kerala, Madhya Pradesh, Maharashtra & Goa, Orissa, Punjab, Rajasthan, Tamil Nadu, UP (West), UP (East), West Bengal

BPL Cellular Limited

Mumbai (Metro), Kerala, Maharashtra & Goa , Tamil Nadu

Hutch Group Mumbai , Delhi , Kolkata, Chennai, Gujrat , Andhra Pradesh , Kernataka, Punjab

Idea Cellular Phone

Andhra Pradesh, Maharashtra , Gujrat, Madhya Pradesh, Kerala ,Haryana , U.P{w}, Madhya Pradesh

Reliance Telecom Limited

Assam, Bihar , Himachal Pradesh, Kolkata, Madhya Pradesh, North east , Orissa , West Bengal

Spice Communication Limited

Karnataka, Punjab

MARKET SHARE OF MOBILE SUBSCRIBERS (MAY 05)

GSM subscriber base grew 2.9% mom to 43.35mn in May 2005. MTNL continued to witness the highest growth in subscriber additions , driven by strong growth in both Mumbai and Delhi circles. Reliance , IDEA and Bharti followed MTNL in mom growth .Bharti maintained it’s leadership position with 27.2% of the market share , and contributed 34% to the total GSM additions for the month .

GSM SUBSCIBERS

Group Company

Subscriber as of April05

Additions in May

Subscriber of May05

%Growth

Bharti 11.389 415540 11604910 3.65BSNL 9883667 194302 9877989 2.01HUTCH 7197297 280778 8188073 2.90IDEA 5153488 210505 8166073 4.08BPL 2991969 2405 5363 0.09SPICE 1449170 13292 2594374 0.12AIRTEL 1769645 16448 1465340 0.93RELIANCE 1185316 62581 1766091 5.37MTNL 961619 73422 1227899 7.95TOTAL 42121496 1225210 43346706 2.91

GSM MARKET SHARE

NET SHARE IN ADDITION

The country is divided into 23 Service Areas consisting of 19 Telecom Circle Service Areas and 4 Metro Service Areas for providing Cellular Mobile Telephone Services (CMTS).

In terms of old licensing scheme of NTP-1994, 8 licenses for Celllular Mobile Telephone Service in the 4 metro cities of Delhi , Mumbai , Calcutta and Chennai were issued to 8 companies in November 1994. 34 licenses for 18 Territorial Telecom Circles were also issued to 14 companies during 1995 to 1998. MTNL and BSNL were issued licenses for operation of Cellular Mobile Telephone Service as third operator in various parts of the country. In terms of NTP-99, 17 fresh licenses have been issued to private companies as fourth cellular operator in September/October , 2001 , one each in 4 Metro cities and 13 Telecom Circles. Presently there are 78 licenses held by 25 Companies including MTNL & BSNL for CMTS in 23 Sevice Areas .

The old licenses of cellular services were permitted for migration to NTP 1999 regime of revenue sharing which was effective from 1st August , 1999. the license fee, excluding spectrum charges for cellular services is 12% of “Adjusted Gross Revenue “ (AGR) for Metro Service Areas and category ‘A’ circles,10% of category ‘B’ circles and 8% of AGR for category ‘C’ circles.

In terms of NTP-99 , cellular operators will be free to provide , within their area of operation , all types of mobile services including voice and non voice messages , data services and PCO’s utilizing any type of network equipment , including circuit and / or packages switches that

meet the relevant International Telecommunication Union (ITU)/Telecom Engineering Centre (TEC) standards.

In UP West (B circles ) the service provide includes Idea Mobile , Bharti cellular , BSNL and Hutchinson Essar . Idea mobile is the leader in this circle as it was the first service provider in the quarter of 2005 is as shown below.

Operators Jan’2005 Feb’2005 Mar’2005Idea mobile 582755 622814 634515Bharti cellular 358706 367748 381787BSNL 513580 508972 512454Hutchison Essar 115017 135905 153034

COMPANY PROFILE

BHARTI CELLULAR LIMITED

Airtel comes to you from Bharti Cellular Limited – a part of the biggest private integrated telecom conglomerate, Bharti Enterprises.

Bharti Enterprises has been at the forefront of technology and has revolutionized telecommunications with its world class products and services. Established in 1967, Bharti has been a pioneering force in the telecom sector with many firsts and innovations to its credit. Bharti has many joint venture with world leaders like singtel (Singapore telecom); Warburg pincus , USA; Telia , Sweden; Asian infrastructure find, Mauritus ; International Finance corporation, USA and New York Life International, USA. It provides a range of telecom services , which include cellular , basic,internet and recently introduced national long Distance. Bharti also manufactures and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments in India , it is also the first company to export its products to the USA. Bharti is the leading cellular service provider, with an all India footprint covering all 23 telecom circles of country.

Bharti has been a pioneering force in the telecom sector with many first and innovations to its credit, ranging from being the first mobile service in Delhi, first private basic telephone service in the country, first Indian company to provide comprehensive telecom services outside India in Seychelles and first private sector service provider to launch National & International Long Distance services in India.

Bharti Enterprises has successfully focused its strategy on telecom while straddling dedverse of business. From the creation of “ AIRTEL”, one of the India’s finest brands, to becoming the largest

manufacturer and exporter of world class telecom terminals under its ‘Beetel’ brand , Bharti has created a significant position for itself in the global telecommunications sector. Bharti Tele-ventures is today acknowledged as one of India’s finest companies , and its flagship brand “AIRTEL” , has over 12 million customers across the length and breadth of India.

Bharti tele – ventures limited , a part of Bharti Enterprises is India’s leading provider of telecommunications services. The businesses at Bharti tele-venture have been structured into two main strategic business groups- the Mobility Leaders business group and the Infotel Leaders business group.The Mobility Leaders business group provides GSM mobile services across India in twenty-three telecom circles, while the Infotel Leaders business group provides broadband & telephone services, long distance services and enterprise services. All these services are provided under the “AIRTEL” brand.

AIRTEL VISION AND MISSION

“To be globally admired for telecom services that delight customers.”

We will meet global standards for telecom services that delight customers through:

Customer service focus Empowered employees

Innovative servicesCost efficiency

Delhi is where it all began. An acid test , which gave the motivation and inspiration to give service , that compares with the very best in the world. This is what has made Airtel one of the top 5 operators in the world in terms of population covered . The growth, to put it modestly, has been phenomenal in terms of subscribers, coverage and the milestones.

THE MILESTONE OF AIRTEL

First and only service to be adjusted the best mobile service in the country consecutively for four years 1997,1998,1999,and 2000 by communications world and awarded the Techies Awards.

First to launch intelligent Network services. First to launch pre-paid roaming service. First to launch full roaming services on pre-paid. First to launch 32kK sim cards. First to launch local direct dialing facility. First to reach the 1 million – customer mark in a singlecircle.

First to successfully conduct EDGE trials. First to launch a dual band network on the country. First to deploy voice quality enhancers to improve voice quality

and acoustics

Bharti Cellular Limited is also the first telecom company in the world to receive the ISO 9001:2000 certification from British Standards Institute.

U.P. WEST NETWORK

The UP west strongest Airtel Network with over 385 cell sites, the highest amongst all operators , which provides:

Enhanced capacity to ensure better connectivity.. Quick call set up. Seamless coverage. Wider coverage. Voice quality enhancement. No call drops. Easy dial access.

THE OUTSOURCING EXPERIMENT

The world’s Sunil Mittal’s Rs. 5,400 crore Bharti Tele-Ventures (BTV) is carrying out most unconventional telecom experiment.Bharti decided to outstanding both its IT system

management and its networks. These are things that all Telco’s globally consider their core business.

As a result of these outstanding contracts, BTV will now just handle a few things; marketing ,sales and distribution. Apart from that ,it will just monitor its vendors,see that they stick to the parameter of the contracts, and make sure that they depley and build only the best system s and networks for Bharti’s operations.

Here how the outstanding experiment – and it is still an experiment – is expected to help BTV. First, the company expects its GSM subscriber base to balloon from 8.2 million to 25 million by 2007.given that a telecom service provider needs to keep 30 percent spare capacity as buffer in its network that means BTV would need to create capacity for about 32 million lines. Adding each line at today’s prices costs about $100. Therefore, BTV wold be looking at a capex of approximately $2,430 million (Rs.11,178 crore), if it were to handle this on its own . Having outsourced the network, however, BTV will pay only for use of 25 million lines that it actually uses. That wold cost it roughly $1,700 million (Rs. 7,820 crore). Thus BTV , though Mittal refuses to confirm the numbers, would save almost $730 million (Rs 3,358 crore) of capex on its balance sheet by 2007.second, BTV saves

Massively on operating expenses as well as – its vendors are charging it substantially less to manage and operate each line and each base station than what it incurs on its own.

Finally,by outsourcing the work, BTV has transferred around 1,000 engineers-with a salary bill of approximately Rs 80 crore per annum-from its balance sheet to that of the vendors.And it won’t need any additional engineers on its payrolls for the 18,000 base stations that would be set up over the next two years.(it would have needed an additional 1,200 engineers for those base stations).It will be the network operator that will hire those people.There are many marginal benefits as well. Post-outsourcing, for instance,BTV’s per-subscriber billing cost will come down by Rs2, to Rs 10-13.

The advantage of outsourcing on this scale are crystal clear.The company will not only save on current operational costs, it will also dramatically reduce its capex requirements as it expands its networks over the next couple of years.Above all, by handing over these tasks lock, stock and barrel to someone else, it frees up much senior management bandwidth to focus on really important things like strategy and long-term growth.

CALANDER YEAR AND EVENTS

1996

Bharti cellular launched cellular services “AIRTEL” in Delhi.

STET international Netherlands NV, or stet, a company promoted by telecom Italy acquired a 20% equity interest in Bharti Tele-Ventures.

Bharti Telecom acquired a 21.05% equity interest in Bharti cellular.

1997

Bharti Telenet obtained a license for providing fixed line services in Madhya Pradesh circle.

Bharti Telecom and British Telecom formed a 51% : 49% joint venture, Bharti BT, for providing SAT services

1998

Bharti Telecom and British Telecom formed a51%:49% joint venture, Bharti BT, for providing Internet services. First Indian private fixed line services launched in Indore in Madhya Pradesh circle on June 4,1998 by Bharti Telnet thereby ending fixed line services monopoly of DOT (now BSNL).

1999

Warburg Pincus (through its investment company Brentwood Investment Holdings Limited) acquired a 19.05% equity interest in Bharti Tele-Ventures.

Bharti Tele-ventures (by acquiring a 63.45% equity interest in SC cellular holdings) acquired an effective 32.36% equity interest in

Bharti Mobile (formed JT Mobiles), the cellular services provider in Karnataka and Andhra Pradesh circles.

New York Life Insurance Fund, or NYLIF, acquired a 3% equity interest in Bharti cellular.

2000

Bharti Tele-Ventures acquired an effective 40.5%equity interest in Bharti Mobil net (formerly sky cell Communications), the cellular services provider in Chennai.

Bharti Tele-Ventures acquired an effective 30.2% equity interest of Telecom Italia in Bharti Telnet and 18.8% from Bharti telecom thereby making Bharti Telnet 100% subsidiary of Bharti Tele-Ventures.

SingTel (through its investment company Pastel Limited) acquired STEL 15.3% equity interest in Bharti Tele-Ventures.

Bharti Tele-Ventures acquired an effective 41.64%equity interest in Bharti mobile (by acquiring remaining 36.55% equity interest in SC cellular)’ resulting in Bharti Tele-Ventures holding an effective 74% equity interest in Bharti Mobile.

2001

Bharti Tele-Ventures acquired NYLIF’s 3% equity interest in Bharti cellular.

2004

Bharti decided to outsource both its IT system management and its networks.

Bharti covered all the 23-telecom sectors present.

ORGANIZATIONAL STRUCTURE

Chairman & group Managing

director

↓

CMDs office-corporate

director

↓ -----------------------------------------------------------------------------------------------------------------

↓ ↓ ↓ ↓ ↓ ↓ Manager Presedent President Corp.Dir.& Corp. Dir. Jt.ManageingDirector ( I ) Infotel Mobility General HR Director ( II ) Council

STATUS VIS A VIS COMPETITION

Airtel is the biggest player in the telecom industry. It has a strong presence in over 23 circles in the country.Airtel started its operations in UP(w) in the year 2002.since then Airtel has taken a considerable market share.

There are 4 major players in the fray in GSM telephony and 2 CDMA operators are just in the process of getting a foothold in market.

In case of GSM telephony the biggest player is IDEA turned Escotel, Which was the only player present in market. Airtel is giving tough competition to the same and Airtel is expanding rapidly. The market is witnessing tough competition with the entry of HUTCH as the fourth player in GSM segment.

In some parts of UP (W) Airtel is leading and trying to catch up with IDEA. It is not only the GSM operators are to be looked but also we can expect some more intense competition in market with the CDMA operators in the fray.

With a good network coverage and wide network Airtel is getting stronger with each passing day.

Airtel has got good future ahead in the hill state and its fast expanding reach will make it stronger.

ABOUT PROJECT

“MANCHITRA & RETAIL EXPANSION”

Project Manchitra is all but a change in the present system or distribution channel.

The project deals in to restructure the working of the functionaries like the retail expansion units.

It is more to know the penetration level of the retailers in a particular area and mapping it to the total no. ot shops that are present in a particular area which is called the universe.

The various areas and sub-areas form the total town. It is to find out the total outlets present at a particular city.

The project has some of the main parts such as:

The outlets to be segregated on the sales value they generate for the company.

The outlets to be given grades on performance.

The entire area to be divided on the basis of penetration in terms of network coverage and the network of retailers in the area.

Retail expansion to be carried and should have all the details of the number of shops and other details of each location and bylanes in the area.

Plotting of the findings in the map of the city.

BACKGROUND

Today the retail expansion and distribution is mapped on DPL basis and the expansion is usually the beat is mapped to cover the city.

The expansion is done mainly through the REE (Retail Expansion Executive ) and the current gaps are identified to expand the retail outlests.

The expansion norms follow the overall DPL target to be met and not the universe penetration.

The reporting and the cross verification is done on an adhoc basis and the best judge is the TM.

Frequency of visit and potential of the new outlets is not rigorously followed.

MEASUREMENT

Measurement will consider DPL but also will consider the % penetration of the total universe of outlets.

The measurement formula will now be

DPL = Total Number of AirTel Outlets / Total covered population *1,00,000

RPTU ( Retail Penetration to Universe ) =Total Number of AirTel Outlets / Total Number of retail outlets ( universe )

Performance of retail growth will be done as under

DPL POINTS SCORE RPTU POINTS SCORELess than 75 -1 Less than 20% -175-100 1 21%-30% 1101-125 2 31%-40% 2126-150 3 41%-50% 3151-200 4 51%-60% 4200&above 5 61%&above 5Weightage 0.5 0.5 Overall Score

CATEGORY CRITERION

Classification of A,B,C & D outlets will be as under:

A+ - 5 %A - 7 %B - 23 %C - 40%D - 25 %

Step 2 will be to map the outlets to the kind of outlets per city.

RETAIL EXPANTION:

STEP ONE

Plotting the retail on excel sheet

Following things to be plotted

= City details demarking the areas / colonies , market areas and lanes to be defined.

= Each area to have indicative households and population .

= Each area to have the details of the market , with the number of outlets in that market.

= AirTel Current outlets in defined markets, competition outlets.

= SUK throughput of the outlets in the defined markets.

= Value contricution ( PRC & ERC secondary ) from the outlets in the defined area and markets.

= The area contribution to the total city performance can be mapped.

STEP TWO

= Plotting the same on the map of the city.

Main towns:Agra Zone : Mathura, Firozabad, EtawahBarelly Zone : Morarabad, Haldwani, Rudrapur Dehradun Zone : Haridwar, Rishikesh, Roorkee, SaharanpurMerut Zone : Muzzafarnagar, Bijnore, Bulandshar

OBJECTIVE

To analyze the retail distribution of Airtel. To know the market and the level of penetration of the company.

The other task to be carried was to fill the gaps if any that exists in the particular area .

It also consist of looking into the satisfaction level of the consumer i.e the retailers. Market coverage and penetration was also to be looked into.

METHODOLOGY

The initial part of the project had the market-mapping task.Market mapping was carried out for Haridwar.The procedure for mapping was to count the number of shops that were present in each area and sub area of the city.The counting was manual one and the shops in the area were divided under 8 categories namely STD,Telecome,White Goods,Grocers,Food Joints,Chemists,Garments & others.

The name of the retailers along with shop name and phone no. was taken.A personnel non-structured interview was carried out with the retailer to know whether he sold Airtel’s product or not and if yes then does he sells competitors products or not. Then the connectivity or the network coverage was asked and this to was segregated under indoor or outdoor network.This would tell about the network coverage of the company in the area. The retailer if he used sell Airtel was asked about if he was satisfied with the serviceprovided by the company’s distributor.

Critical areas were looked into in priority basis. Speedy solutions were to be provided to the dissatisfied retailer.The second part was the retailer expansion of Airtel in the city. It was more of filling up the gapes in the market and to increase the number of outlets.

There was personnel interviews carried out with retailers and the benefits and profits margins were covered lead generation was there and accordingly seeing that the lead is covered into a prospective retailers.

The area that were marked as potential or where it was found that there was a low penetration of the brand was into a priority basis.

After converting the retailers it was the development phase of the retailers so he retained as a sells force for the company.Helping the retailer to develop into a good retailer.

REVIEW OF LITRATURE

DISTRIBUTION NETWORK OF AIRTEL

The distribution channel that Airtel follows for its Magic cards ,which is its prepaid card service,is one through the direct channel.

The direct channel consists of the Distributors,who is responsible to pass on the goods to the retailer base, which is also formed,by the Distributors. The goods after passing from the Distributor to the retailer finally reach the end customers. The company directly deals with the Distributors who inturn with the retailers.

The distributors that is selected by Airtel is one,which has an experience in the distribution of FMCG product, and there no restriction, as of that the distributor should not distribute any other products.

The Distributors places the goods to the retailers through FOS i.e field officer sales. These are the boys who are looking after allocated areas and they are responsible for the development of the area. The FOS are responsible to convey scheme if any. They also provide claims that the company owes to retailers.

There is one merchandiser who is responsible to look into the visibility part of Airtel in a particular city.He is responsible to paste Pop’s,banners,sun packs,and e.t.c.as promotional supports from the company to the retailers.

Airtel has two types of products the prepaid and the postpaid.There are two different type of strategies that is follows for its two different products.

The products are

Prepaid

Postpaid

As We were just looking after the distribution channel of prepaid cards i.e. Magic cards just giving an overview of what type of channel is used in the postpaid section of Airtel.

In postpaid the company appoints a franchisee in an area.In an area the no. of franchisees may depend on the area of the city.A city like Haridwar had just 2 postpaid franchisees.

The franchisees of Airtel in postpaid are known as Airtel connects.The connect franchisees has a team of FOS. The FOS(Field Officer sales) is the actual people who looks after the sales of the products. They go to the fields generate leads ands convert the leads and gets customers for the company.The franchisees are under direct supervision of the company.

The postpaid connection are not easily available over the counter as the prepaid is readily available with the next-door retailer as there is a lot of rigorous verification has to be under taken for getting a connection,

A graphical presentation of the distribution channel is being provided below.

COMPANY COMPANY

↓ ↓DISTRIBUTER AIRTEL CONNECTS

↓ ↓

RETAILERS CUSTOMERS

↓ CUSTOMERS

MARKETING AGENTS

FOS(Field Officer Sales)

Marketing Agents are responsible for supporting and efficiently managing the distribution channel of the company. They are appointed to cover the service area geographically. The distributor is responsible for hire and maintain the marketing agents for the company.These are the most important link between the company and the retailers.

These are the people who have to look into the entire market of the city.They know where the outlets are actually located and they are to build a healthy relationship with the retailers.They also have to take up the requires of the retailers and try to solve the ones that they can handle otherwise notify of the same to the distributor.

The marketing agents follow a definite Beat plan, which is chalked out by the distributor. Beat plan is the chart stating breakdown of the city into small area. Haridwar has 6 beat plan and the marking agents had to visit the mentioned places twice a week.The marketing agents job is to look into that the retailers are not short of goods. They are one of the replenishment agents of company.The role of the marketing agents is thus very crucial.Marketing agents forms the support system of the company and they are the important link between the company and the end customers.

RETAILER

The other marketing agents of the company is the retailers who are selling to the end customers.There is no restriction on the retailer to just keep the products of Airtel.They can have a variety of product range of the competitors also.

They are the one who actually convert the product into revenues for the company and one of the important links in moving a products. If the retailers are satisfied then only you can expect your products to move. It is the retailer who is responsible for selling a good or bad products to the buyer.Retailer should be taken good care of. They form an integral part of the distribution channel.

ABOUT THE PRODUCT

Airtel’s prepaid is commonly known as MAGIC card.This is a prepaid card, which the customer has to recharge on a routine.This is a hassle free card, in which a customer can customize is according to his needs as there are various amounts of recharges available the customer has a flexibility on the amount he wants to spend.

TYPES OF SIMS PRENTS IN U.P (WEST)

REGULAR SIMS

30 paise Advantage pack

Incoming pack

PostPaid Sims

TYPES OF RECHARGES

200 RC Paper Coupon with 1-month validity and RS. 50 talk time

220 RC Paper Coupon with 20 Days validity and RS. 99 talk time

331 RC Paper coupon with 1- month validity and RS. 150 talk time.

662 RC Paper Coupon with 45 Days validity and RS. 450 talk time.

1325 RC Paper Coupon with 2- month validity and RS. 1050 talk time.

3306 RC Paper Coupon with 1-Year validity and RS. 2700 talk time.

There is a flexibility of recharge through electronic recharge where a customer can have the flexibility of recharging from a minimum denomination of RS. 55 to RS. 9999.

Talking about the sim cards they are different to address to the different needs of each customer. As for e.g. a person who just wants a mobile can have the facilities of the incoming pack of Airtel, If a person has many of his friends logged to the network of Airtel he can can go for the Advantage pack. The simcards bearing different names have different rates applicable to them. The rates on a sim depends on what types of scheme is launched during different periods.

KEY LEARNINGS

As we know life is full of changes and changes is the call of the day.There are several things that we learn with our day- to –day experience.The learning’s that I had after working with airtel are:

About the distribution channel which Airtel or any other Telecom company follows.

About how to deal with the retailers.

Knowledge about how schemes are formulated and implemented.

About one can efficiently manage a big distribution channel to gain results.

To talk in an ever changing environment and to work efficiently with the least of the resources available.

BIBLOGRAPHY

www.gsm.com

www.airtel.com

www.bhartiteleventures.com

www.trai.gov.in

www.tdsat.nic.in

www.India-cellular.com

www.COAI.com