Project Report For
The project report for Distribution business is as follows.
There’s been a major growth of distribution networks in India in the last few years. The Indian retail sector, currently worth at $490 billion, is expected to rise at a CAGR of 6% to hit $865 billion by 2023, as per Oxford Economics.
The overall amount of retail outlets around the world is projected with over 12 million , mainly family-owned enterprises. The annual growth rate for both the FMCG market is expected to be 11 per cent during the next 10 years.
Many Indian manufacturers choose a three-tier manufacturing and distribution system which has changed over the years.
This system includes the allocation of stocks, wholesalers and retailers. For instance, an all-India-based FMCG company may have around 40 and 80 distribution stockholders (RS).
The RS would be marketing the commodity between about 100 and 450 wholesalers. Eventually, RS and wholesalers can represent about 250,000 and 750,000 distributors across the world.
Market potential & Strategy
Most Indian companies choose a three-tier manufacturing and distribution system that has changed over the centuries. This arrangement includes the allocation of stockholders, wholesalers and retailers. Wholesaling is lucrative by keeping stable costs with high profitability, and average FMCG profit margin ranging from 4% to 5%. Most FMCG and pharmaceutical companies use clearance and forwarded (C&F) agents for delivery, as consumer perception is evolving, the reach of logistics delivery is also growing.
The major difference is timely delivery, sufficient time for credit sales, etc. Manufacturer or service provider dependent SOP (Standard Operating Procedures) could also be in effect.
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