Pricing Technique by the American indian Cigarette Sector

 Essay upon Pricing Approach by the Indian Cigarette Industry

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Marketing Program Design


Table of material

Table of contents2

1 Introduction: Cigarettes3

2 Cigarette Industry in India3

installment payments on your 1 Cigarette Market Share in India5

installment payments on your 2 Selling price Spread of any nicotine products in India5

3 Manufacturing Process6


4. 1 Distributor7

4. 2 Wholesale Dealer8

4. several The Retailer8

5 Prices Strategy11

5. 1 Costs Objective11

5. 2 Determining Demand11

5. 3 Calculating Cost12

a few. 4 Picking out a Pricing Method12

5. five Selecting the ultimate Price12

6th Taxation upon Cigarettes (Exhibit 1)13

1 Introduction: Smokes

Almost 20% with the world's adult population smokes cigarettes. Smokers consumed practically 5. 9 trillion cigarettes in 2009, symbolizing a 13% increase in cigarette consumption during the past decade. India is the second largest producer of cigarette products in the world after China. India's usage per household stands for 99th place in the world. (Source: World Overall health Organization)

two Cigarette Market in India

Cigarettes account for less than 15% of cigarette consumed in India as opposed to world design of 85% due to extented punitive taxation. Cigarettes (15% of cigarette consumption) bring about the bulk of Revenue to the Armory from tobacco sector 48% of adult Indian guys consume cigarettes. Only 10% of adult Indian males smoke cigarettes as compared with 16% who smoke biris and 33% who employ smokeless cigarette (Source: Global Adult Tobacco Survey India 2010)

Biri: Cigarettes percentage = almost 8: 1

Total annual per household adult cigarette consumption in India is around one 10th of world average. Future growth will depend on relative costs of growth of per household income and moderation in taxes.

Figure [ 1 ]: Per Household Consumption of Tobacco in India

Per Capita cigarettes consumption is ~ 60 per cent of World Average

(Source: World Cigarettes – ERC Statistics, Tob Board & Industry Quotes – gms/Yr)

Figure [ two ]: Per Capita Cigarette Consumption – per annum Per Capita cigarette consumption in India < 11% of World typical. (Source: The Tobacco Atlas – third Edition)

three or more. 1 Cigarette Market Share in India

Figure [ 3 ]: Market Share of the Indian Cigarette Industry a few. 2 Price Spread of Cigarettes in India

The under graph depicts the price pass on of various smokes.

Figure [ some ]: Expense Comparison every Stick

three or more Manufacturing Procedure

* Cigarette making process entails processing of tobacco leaf and stem to different cigarette blends, which is cut cigarettes. * Minimize tobacco can now be converted to cigarette using additional raw materials to make cigarettes and packing these people in various varieties as per the trading requirement. * ITD will get various levels of Cigarettes Leaf and stem from Indian Tea leaf Tobacco Division (ILTD) centered mainly in Guntur, Andhra Pradesh. 5. The lower tobacco is then sent to the secondary manufacturing division (SMD) for making and packing cigarettes. * At SMD, you will discover two procedures: Making and Packing

5. Making is the process is definitely the rolling of cigarette.

* Packing procedure is packing of these cigarette sticks in the cigarette packets of various bunch styles. 4 SUPPLY CHAN MANAGEMENT

ITC has got over 900 from suppliers dealers offering more than 1 million stores. The following elements are in supply sequence management.

* Development: It all regarding where business focus on simply how much to produce, where you should produce this and what are the suppliers to use. 2. Inventory: All of it about in which the business decides where to shop their products, and exactly how much to store. * Circulation: where the organization address questions about how there ought to be moved and stored. 5. Payments: That concern about where organization look for the right way to suppliers and get paid by customers.

a few. 3 Supplier

Distributor supports manufacturer dispersing its products to various geographical...



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