DISTRIBUTION AND CHANNEL

MANAGEMENT OF GENERIC
DRUG STORES and DABUR
INDIA
GENERAL INTRODUCTION OF C &
D:-------
Helps to make your products in the hand
of customers easily ,cost saving and by
different ways.
 Retailers – Organizations that sell products
directly to final consumers.
 Wholesalers – Organizations that purchase
products from suppliers, such as
manufacturers or other wholesalers, and in
turn sell these to other resellers, such as
retailers or other wholesalers.
 Industrial Distributors – Firms that work
mainly in the business-to-business market
selling products obtained from industrial
suppliers.
 Agents and Brokers – Organizations that
mainly work to bring suppliers and buyers
together in exchange for a fee.
 Distribution Service Firms – Offer services
aiding in the movement of products such as
assistance with transportation, storage, and
order processing.
 Others – This category includes firms that
provide additional services to aid in the
distribution process such as insurance
companies and firms offering transportation
routing assistance
 Cost Savings in Specialization
 Reduce Exchange Time
 Customers Want to Conveniently Shop
for Variety
 Resellers Sell Smaller Quantities
 Create Sales
 Offer Financial Support
 Provide Information
 Generic Drug Stores

• Indian market has three types of drugs

based on the marketing strategy -
• Branded medicines( generics with
popular brand names)-promoted by
manufacturer
• Branded Generics (generics with less
popular brand names)– promoted by
the retailer
• Generic-generic drugs (no brand
names)-sold in hospitals
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 Survey done by NPPA on the three types of drugs shows
 Bas follows –
•Branded drug- Wholesale margin-10%
Retail margin – 20% ,
•Branded generic-Whole sale margin-10%
Retail margin-90%-100%,
•Generic- generic- Whole sale margin-10%
Retail margin-80%-90% ,
 Price to wholesaler-Rs28, price to
Retailer- Rs32, MRP-Rs40 (retailer
gets Rs 6 only)
– large margin retained by mfg for
promotion, R&D etc
 Price to wholesaler Rs2.00, Price to
retailer-Rs6.00,MRP-Rs36
(retailer gets Rs 32)
 Concept of Generic Drug
Stores
• To set up specialised drug stores dispensing
only generic (unbranded)drugs
• Trade margins to be kept low, Benefit to be
passed on to the consumer by eliminating
the normal retail channels e.g drug costing Rs2 can
be sold at MRP of less than Rs 10
• Initiative of the Public sector pharma
companies – to start operations with their
own drugs(which are limited in number) and
drugs from the good quality manufacturers

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 List of Medicines

• List of Medicines mainly having a

single salt has been prepared

• Core Group consisting of Public sector

pharma companies formed –
to work out the modalities and
logistics

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 DISTRIBUTION
NETWORK
CPA (CENTRAL PROCUREMENT AGENCY –
DELHI BASED)

DISTRIBUTERS (STATE WISE)

STOCKISTS

RETAIL OUTLETS (IN STATE LEVEL & DISTRICT

HOSPITALS)

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MARGINS FOR DISTRIBUTION
CHANNELS
CPA 2%

DISTRIBUTORS 3%

STOCKISTS 5%

RETAIL OUTLETS 10%

Total margins would be 20% on retail

prices
Distributors to function as Stockists
till these are appointed

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TERMS OF PAYMENT TO THE
SUPPLIERS
• 60 days credit from the manufacturers
who would be supplying generic drugs
• Initially 60 days of payment time
need to be given to the Distributors.
• Distributor’s responsibility to release
payment from the Stockist.
• Similarly, Stockist would release the
payment from retail outlets.

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 DABUR: Largest Indian Personal & Healthcare Company

Company
•Largest in Ayurveda•Herbal & • 3500 employees
Natural Portfolio •14 Plants
•5 Umbrella Brands •5000 Distributors
•350+ products •Retail Reach 2,500,000

-One of the top 3 Most Respected FMCG Companies

(BW, March 2007) -Among “Best under a
Billion”companies in Asia Pacific(Forbes Asia 2005 &
2006)-One of the fastest growing in industry with
CAGR of 19% in sales and 39% in Profits over last 4
years
MARGINAL DISTRIBUTION OF DABUR:--

FOR RETAILORS IT IS 8-10%

FOR DISTRIBUTORS IT IS 3-4 %

FOR STOCKISTS IT GOES AROUND 2-3 %

FOR EG. DABUR AMLA HAIR OIL

MARKET PRICE 32Rs.
Total distributers 5000
Total retail outlets 2500000
Manufacturing plant>company ware house>Regional ware
house>regionalstockist>superstockist>stockist>distributor>ret
ailer
Now this channel depends on the complexity of the product....
if it is a product like pen,soap etc...then the entire channel might be
there...as the complexity of the product goes up the channel size comes
down.
most of the FMCG company will have a similar channel as discribed.
Dabur gets about 75 of its sales from rural areas.
So the chain can get long in this condition.
Sales around 50 countries of the world.
BIBLIOGRAPHY

Special Reference from

WWW.GOOGLE.COM

Dabur india website

Dabur India ppt and pdf

Special Classes of MIBS

And scribd.com ppt