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ROI CALCULATIONS OF ROLLICK ICE CREAMS

Group 7

Srikanth Bizza M014/13

G Dilleswar Rao M017/13

G Sagar M020/13

Hemanth Kumar M022/13

K Vamsi Krishna M028/13

Nand Kishore Bagde M040/13

Syed Areef M069/13

Vinay Banda M099/13

Sudheer Peram M126/13

Rajshekar V M157/13

Ujjwal Chowdhury M160/13

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ABOUT ROLLICK

Registered under the name of Prestige Ice Cream Pvt. Ltd.(H.O: Kolkata)

Established in 1983.Supplier and manufacturer of rollick ice cream.

3 Directors/Partners

One of them is Natasha Agarwal, who also owns Mama Mia ( Ice

Cream Parlour)Market share of 15% in Kolkata ( 3rdplace)

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ICE CREAM INDUSTRY

Frozen Desserts and Ice Creams form the Ice Cream Industry in India.

Barring Amul ,Mother Dairy, Hatsun Agro Food Ltd. All others serve frozen desserts.

Amul, the category leader in ice creams with 40% market share

Baskin Robbins is a market leader in the premium category of ice-creams

The Rs. 2,500-crore frozen dessert market in India is growing at an average of 15 per centand is still dominated by regional players

the per capita consumption of ice creams in India is about 300ml per annum, 1.4% of that inUS, and 13% of the world average

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There are two types of distributors

1. Vending Distributors2. Marketing Distributors

Vending Distributors:

Distribute to Push-cartsDaily sales target of 700 RsRequired infrastructure is Deep

freezers and push carts provided by thecompany at subsidized price of 25K

Marketing Distributors:

Distribute to the retailersHave quarterly targetsRequired infrastructure is Deep

freezers, A4Ws and Mini-trucks

Procedure followed to issue distributorship of Rollick

The company representative (Sales Manager) selects a retailer who is doing goodamount of business(Volumes) consistently. They look at his financial background and his ability to invest Then they will groom him by allocating the area for distribution and companysupports him in terms of infra structure needed etc.

ABOUT DISTRIBUTORS

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This is the oldest distributors of Rollick among the 20 distributors they have

A deeper look into SHRI OM Distributors

Infrastructure:

10 Deep freezers each of capacity 500 litres, Cost is 25K, Monthly expense: 600 Rs 6 Mini-trucks of cost 2 Lakhs each, Monthly expense: 3640 Rs 6 A4Ws surmounted on the mini-trucks each can accommodate 100 bricks + 125 Boxes,Monthly Expense: 20002500 Rs 1 Bike of cost 50KOwn Store

Human Resource:10 Staff Members (4 Drivers, 4 Salesmen, 1 Helper and 1 Accountant)

Coverage: 250 Retail stores

Name of the proprietor: Sunitha Agarwal,

Contact nos: +(91)-651-2202242, 9431101017, 8051036164Address: Main Road, Lalji Hirji Road, Ranchi

SHRI OM DISTRIBUTORS

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Route 1 (Main

Road) Lake Road

Gandhi Chowk

Pinnacle Tower Kutchery Road Main Road Church Road Main Road Hazaribagh Road Lake Road

Route 2 Harmu

Road)

Lake road

New Market

Harmu road

Ashok Nagar Patel Chowk

Nizam nagar

Lake road

Route 3 Ratu

Road)

Lake road

Radium road

Nagratouli

Circular road Lalpur

Katatoli

Kokar

Lake road

The beat plan isthe same for thewhole week i.e. 6days

One driverand onesalesman

per tempo

Route Map

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SEASONAL VARIATION

Peak season Off peak season

6 months (Mid Feb - Aug) 6 months (Sep Mid Feb)

40 retailers/tempo 20 retailers/tempo

4 tempos 2 tempos

30-35k per day/tempo 10-15k per day/tempo

10 deep freezers used 6 deep freezers used

- Focus is more on party orders

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EXPENSES

Expenditure Off peak season Peak Season

Utilities

Deep FreezerElectricity Bill

6*600 3600 6000

A4W Electricity

Bill2*2500 5000 10000

Phone 2000 2000

S

alaries

Driver 4*6000 24000 24000

Salesmen 4*7000 28000 28000

Helper 1*5000 5000 5000

Account 1*8000 8000 8000

Other

Stationary 2000 2000

Fuel 2*2*70*26 7280 14560

Vehicle

Maintenance

2*9000/12

1500

3000

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ROI CALCULATIONS

Credit AnalysisOff season Sale 10L 30L/Quarter

Peak season Sale

20 L

60L/Quarter

Credit of 1 Month from Distributor

Off season Sale 6 L

Peak season Sale 11 L

Market interest 10%

Per week interest rate 0.0019231

Credit by supplier

for 1 Week

1*.0019231*100000 1923.1 Off Season

1*.0019231*200000 3846.2 Peak Season

Credit by distributor

4*.0019231*600000 4615.44 Off Season

4*.0019231*1100000 8461.64 Peak Season

Effective Credit byDistributor

4615.44 -1923.1

2692.34

Off Season

4615.44 Peak Season

ROI Calculations

Total Expense89072.34 Off Season

107175.44 Peak Season

ROI

10%*10L/6L 0.01821276Off Season

10%*20L/11L 0.08438596Peak

Season

EffectiveROI For the

year

6*off seasonROI +6* Peak

season ROI0.61559238 61.56 %

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One of the main reasons of high ROI because he is in a matured phasewhere there is no depreciation

Investing in new vehicles would be a better end of the bargain tocomparing depreciation to maintenance cost of new vehicles

Negotiating with suppliers for increasing credit

ROI of the Shri Om distributor is high compared to its competitors inRanchi, the suppliers can identify distributors that are not efficientperformers. Shri Om distributor can be given other routes and makehim to invest more.

RECOMMENDATIONS

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APPENDIX

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APPENDIX

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Questions?

THANK YOU