Tata Nano
Assignment 01 Part A
What is distribution Channel? Most producers use intermediaries to bring their products to market. They try to develop a distribution channel (marketing channel) to do this. A distribution channel is a set of interdependent organizations that help make a product available for use or consumption by the consumer or business user. Channel intermediaries are firms or individuals such as who lesalers, agents, brokers, or retailers who help move a product from the producer to the t he consumer or business user. Distribution decisions can sometimes give a product a distinct position in the market. The choice of retailers and other intermediaries is strongly tied to the product itself. itself. Manufacturers select mass merchandisers to sell se ll mid-price-range products while they distribute top -of-the-line -of-the-line products through high-end department and specialty stores.
C&F agent "Clearing and Forwarding Agent" means any person, who is engaged in providing any service, either directly or indirectly, connected with the c learing and forwarding operations in any manner to any other person and includes a consignment agent.
Types of retailer There are three types of o f retailers: 1) Store retailers: operates on a fixed point of sale and depending upo n the certain criteria they are divided into Department store, Discount Stores, Specialty Store, Category Killer, Convenience Store, Off-Price Retailer, Warehouse Clubs. 2) Non-store retailers: use various methods such as broadcasting of "infomercials" direct response advertising etc. They are categorized cat egorized as Direct Selling, Direct Marketing, Automatic Vending and Buying Service. 3)Corporate Organization: achieve economies econo mies of scale, greater purchasing power wider brand recognition and better trained employees because of the central buying of the merchandising. They are classified as Corporate Chain Store, Voluntary Chain, Retailer Co-operative, Consumer Co-operative, Franchise's Organization and Merchandising Conglomerate.
Supply Chain Management:SCM is the management of a network of interconnected businesses involved in the u ltimate provision of product and service packages required by end customers .Supply chain management 1
Tata Nano
Assignment 01
spans all movement and storage o f raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.
Part 2 Product selected: ± Tata Nano Industry: - Automobi le
Analysis
Tata Motors is implementing a µhub-and-spok e¶ model f or Distribution Channel What is µhub-and-spoke¶ Model:³The hub-and-spoke distribution paradigm (or mode l or network) is a system of connections arranged like a chariot wheel, in which all traffic moves along spokes connected to the hub at the center. The model is co mmonly used in industry, in particular in transport, telecommunications and freight, as well as in distributed co mputing.´
2
Tata Nano
Assignment 01
for Nano¶s distribution, which would mean that it would involve increasing dealership points as well as adding sales and customer touch points. Tata Motors has said that d ealerships based in bigger cities will be responsible for looking after these touch po ints, which could be located even in the remotest corners of the country. As per the plan, the Tata Nano dealers in the cities would play the role of hubs. They in turn will undertake the effectiveness o f other sales and customer touch points, which would play the spokes. As per plan, Tata Motors would launch the Nano across the country. Tata Motors has reportedly decided to focus on semi urban and rural markets to sell the people¶s car.
C&F Agent :The Tata nano have various C&F agent. Those C&F agent collects the Tata Nano from HUB and distribute it across the country. The C&F agent selected based o n their performance in the particular area. The Spoke are available in the major cities from there the cars are supplied to the rural area.
Retail Stores As the segment of the Tata nano is very wide so the there is huge number of retail outlets available for Tata. Around 600 outlets are available in which Tata nano and other products are sold. With the invention of Tata Nano, company decided to increase the no. of outlets as the Target market was Semi-urban and Rural market. The Strategy Adopted by Tata Nano f or Promotio n and distributio n
Tata Motors have gone one step ahead and have got one of India¶s biggest retail chain for consumers, namely the Future Group to display their small wonder car, the Tata Nano, at the firm¶s Big Bazaar retail outlets. Sales of the Tata Nano have been on the rise as of late inspite of the recent fire catching incident. Reason behind the Strategy
Tata Motors chose Big Bazaar as their marketing partner, a Tata Motors spokesperson said that as of now, Big Bazaar has the highest retail chain in the country, 148 to be exact. The Tata 3
Tata Nano
Assignment 01
Nano would be displayed in almost 120 of them. People, who previously were shy to check out the car in show rooms can now check them out at the Big Bazaar outlet. The Nano also supports Big Bazaar¶s theme of giving the customer the maximum at the lowest cost available. He also said that customers booking the Tata Nano from a Big Bazaar outlet would also get vouchers worth Rs 1500 or other gifts such as go ld coins. We at Indiandrives support this venture and are sure that more and more customers would be attracted to the small car.
Supply Chain managment Tata Nano has one Hub to manufacture the car. The raw material is supplied their and then the cars are manufactured. Tata Motors simply provided the output they expected and allowed suppliers to get creative with their designs, materials and prices. In other words, Tat a described the ³goal´ they wanted to achieve with a certain part and the suppliers took that and ran with it.
4
