Project title

Research report on comparative

Analysis of sales and distribution
between Airtel & Vodafone

Project Guide

Submitted By

Table of Content
 • Executive Summary
• Acknowledgement
• Methodology
• Indian Telecom Market
• Sector Outlook
• Company Background
• Distribution Network
• Selection of Dealers
• Service Network
• Company Background (Hutch)
• Distribution Network
• Selection Of Dealers
• Service Network
• Questionnaires
• Data analysis

Executive Summary
This project aims to study the distribution channels, sales
network and service patterns of the telecom sector through an
analytical and comparative study of two leading companies- Bharti
Airtel Limited. & Vodafone Ltd. The project also tries to bring out
the shortcomings, if any, in the present system and thus recommends
suggestions to improve the same. The project also gives insights into
the various financial terms, norms of the sales and service
departments as per the guidelines of the telecom industry.
The project was designed after detailed discussion with the company
officials on three parameters i.e. distribution network, service
network and sales functioning. The project also includes the insights
given by the dealers and officials of the company.
Firstly, the project discusses the distribution network of the two
companies and the functions carried out by the channel members.
Bharti Airtel Limited being the largest services provider in India
definitely has a wider reach and more number of dealers than
Vodafone.
The project also covers the financial terms of the company with the
dealers and that of the dealers with the customers.
Secondly, the project discusses the sales functioning of the two
companies, which includes aspects such as the hierarchy of the sales
department prevalent in the company; the responsibilities and
functions of the sales force, their performance appraisal structure etc.
Finally the project covers the service network of the two companies
which deals with the after sale services and their effectiveness
provided by both the companies and various complaints and queries
are handled by them. Acknowledgements.

Acknowledgement
We are very thankful to the entire dealer, service, and sales
network of Bharti Airtel Limited and Vodafone Limited for their
cooperation, without which completion of this project would not have
been possible.
We are extremely grateful to for sharing with us all the details of the
project and providing us with valuable insights about sales,
distribution & servicing function. We would like to thank them for
the patience shown by them and being of such a great help to all our
queries.
We would also like to express our gratitude towards our Coordinator
Prof. Ahmed Shahool , for giving us an opportunity to do this project
on sales and distribution and for being the guiding light through the
completion of this project.

Methodology
The objective of this project on sales and distribution is to do an
analytical and comparative study of the sales, service and distribution
function of two players from the chosen business sector.
The business sector chosen for this purpose is the fast growing
telecom sector, and the players chosen for study from this sector are:

➢ Bharti Airtel Limited

➢ Vodafone Limited

INFORMATION SOURCES

PRIMARY DATA SOURCES:-

 VODOFONE FRANCHISEE
 VODOFONE AUTHORIZED DEALERS
 BHARTI AIRTEL LIMITED – Territory Manager
 BHARTI AIRTEL LIMITED AUTHORISED DEALER & FRANCHISEE

SECONDARY DATA SOURCES:-

 WWW.GOOGLE.COM
 WWW.AIRTEL.COM
 WWW.ASKJEEVES.COM
 WWW.INDIAINFOLINES.COM
 WWW.AHMEDSHAHOOL.COM
 WWW.ASKLAILA.COM
 WWW.VODOFONE.IN
DATA COLLECTION TOOLS:-

Interviews & Discussions with the company officials, dealers and

Sales people. Questionnaires were used to record data.

LIMITATIONS:-

It was difficult to ask for time required for a detailed discussion on

the questionnaire & therefore several aspects of the questionnaire
were answered briefly.
The company officials did not divulge details about competitive sales
policies, strategies & certain financial terms with dealers as they find
it to be a confidential piece of information of the company.

Indian Telecom Market

SIZE

 India is the fifth largest telecom services market in the world;

$17.8 billion revenues in FY 2005
 Industry grew by about 36% in FY 2005 over FY 2004

 The Indian telecom market size of over $8.3 billion is expected

to treble itself by year 2011-2012, according to Ernst & Young.
"The Indian telecom market size of over $8.3 billion is expected
to treble itself by financial year 2012. Thus there is a significant
opportunity for telecom players.

 Telecom market has grown at about 25% p.a. over the last 5
years.
  Wireless segment subscriber base grew at 85% p.a.: fixed line
segment at about 10% p.a.

STRUCTURE
 The Indian telecom market has both public and private sector companies
participating

 Public sector has over 60% market share, down from 90% in 2000

 Private companies have added subscribers at a CAGR of 192% since

2000

 Mobile operators have deployed both CDMA (16 million users) and
GSM (55 million users) wireless networks

 Value added service features constitute 10% of revenue today (2% in

2001)

POLICY
 74% to 100% FDI permitted for various telecom services

 FIPB approval required for foreign investment exceeding 49% in all

telecom services

 100% FDI permitted in telecom equipment manufacturing.

 India has a telecom policy aims to encourage private and foreign

investment , Highlights are

 An independent regulator – the Telecom Regulatory Authority of India

(TRAI)

 Revenue-share model for license issued by the Government for telecom

services in India. Unified access licenses are available for providing
telecom services on a pan-India basis.
  Planned opening up of National Long Distance (NLD), International
Long Distance (ILD) and other value added services.

Company Services Investors

Cellula
Basic NLD ILD
r

Vodafone,
1.Bharti Yes Yes Yes Yes Singapore Telecom,
Televentures
Warburg Pincus

2.Relience Yes Yes Yes Yes Reliance group

Infocomm

3.Tata Indicom Yes Yes Yes Yes Tata group

4.BSNL Yes Yes Yes Government of India

Vodafone
5.Vodofone Yes Whampoa,
Essar Group

AT&T,
6.Idea Yes Tata Group,
Birla Group

Note:
NLD - National Long Distance
ILD - International Long Distance
Source:
TRAI, DOT, TSMG Analysis.

Sector Outlook
Outlook
• India expected to be among the fastest growing telecom markets in the
world
• Projected growth of 30-40% p.a. to reach 250 million subscribers by
2009-2010
• Over 3 million new users are added every month – mostly in wireless

POTENTIAL
1. Favorable demographics and socio economic factors leading to
high growth
• Growth of disposable income combined with changes in lifestyle
• Increasing affordability-low tariffs, easy payments plans and handset
financing
• Increased coverage and availability of mobile services
2. Investment opportunity of $22 billion across many years:
• Telecom Devices and Software for Internet, Broadband and Direct To
Home Services. Set Top boxes, Gateway exchange, Modem, Mobile
handsets and consumer premise equipments, Gaming Devices, EPABX,
Telecom Software.
• Telecom Services for voice and data via a range of technologies
• Applications and Content development ranging from gaming to
education
• Nokia, Electeq, Alcatel, LG, Ericsson are all investing in India

SECONDARY DATA: www.dotindia.com, www.trai.gov.in

 Company Background

Bharti Airtel

Bharti Airtel formerly known as Bharti Tele-Ventures Limited (BTVL)

is among India's largest mobile phone and Fixed Network operators. With more
than 70 million subscriptions as of 13th February 2010. It offers its mobile
services under the Airtel brand and is headed by Sunil Mittal. The company
also provides telephone services and Internet access over DSL in 14 circles.
The company complements its mobile, broadband & telephone services with
national and international long distance services. The company also has a
submarine cable landing station at Chennai, which connects the submarine
cable connecting Chennai and Singapore. The company provides reliable end-
to-end data and enterprise services to the corporate customers by leveraging its
nationwide fiber optic backbone, last mile connectivity in fixed-line and mobile
circles, VSATs, ISP and international bandwidth access through the gateways
and landing station.
Airtel is the largest cellular service provider in India in terms of number of
subscribers. Bharti Airtel owns the Airtel brand and provides the following
services under the brand name Airtel: Mobile Services (using GSM
Technology), Broadband & Telephone Services (Fixed line, Internet
Connectivity(DSL) and Leased Line), Long Distance Services and Enterprise
Services (Telecommunications Consulting for corporates).

Leading international telecommunication companies such as Vodafone and

SingTel held partial stakes in Bharti Airtel.
In April 2006 Bharti Global Limited was awarded a telecommunication silence
in Jersey in the Channel Islands by the local telecommunications regulator the
JCRA. In September 2006 the Office of Utility Regulation in Guernsey
awarded Guernsey Airtel with a mobile telecommunication silence. In May
2007 Jersey Airtel and Guernsey Airtel announced the launch of a relationship
with Vodafone for island mobile subscribers. In July2007, Bharti Airtel signed
a MoU with Nokia-Siemens for a 900 million dollar expansion of its mobile
and fixed network. In August 2007, the company announced it will be
launching a customized version of Google search engine that will provide an
'array of services' to its broadband customers.
In March 2008, Bharti Airtel will leverage the expertise of Singtel to roll out
third generation services in Sri Lanka. This is because Singapore-based Asian
telecom major Singtel, which owns a little over 30% in Bharti Airtel, is a major
player in the 3G space as it has already third generation networks in several
markets across Asia.
Recently Sunil Bharti's Airtel launched its calling card in America specially for
the NRI (Non-resident Indians) and people calling from America to India at a
cheaper rate as compared to the tariff offered by other providers.
On February 12, 2007 Vodafone sold its 5.6% stake in Airtel back to Airtel for
US $1.6 billion; and purchased a controlling stake in rival Hutchison Essar.
Bharti Airtel is one of India's leading private sector providers of
telecommunications services based on an aggregate of 59,627,937customers as
on January 31, 2008, consisting of 57,417,625 GSM mobile and 2,210,312
broadband & telephone customers.

The businesses at Bharti Airtel have been structured into three individual
strategic business units (SBU’s) - mobile services, tele media services (ATS) &
enterprise services. The mobile services group provides GSM Mobile services
across India in 23 telecom circles, while the ATS business group provides
broadband & telephone services in 94 cities. The enterprise services group has
two sub-units - carriers (long distance services) and services to corporates. All
these services are provided under the Airtel brand.

Company shares are listed on The Stock Exchange, Mumbai (BSE) and The
National Stock Exchange of India Limited (NSE).
Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. The
Bharti Group has a diverse business portfolio and has created global brands in
the telecommunication sector. Bharti has recently forayed into retail business as
Bharti Retail Pvt. Ltd. under a MoU with Wal-Mart for the cash & carry
business. It has successfully launched an international venture with EL
Rothschild Group to export fresh agro products exclusively to markets in
Europe and USA and has launched Bharti AXA Life Insurance Company Ltd
under a joint venture with AXA, world leader in financial protection and wealth
management.
Airtel comes to you from Bharti Airtel Limited, India’s largest integrated and
the first private telecom services provider with a footprint in all the 23 telecom
circles. Bharti Airtel since its inception has been at the forefront of technology
and has steered the course of the telecom sector in the country with its world
class products and services. The businesses at Bharti Airtel have been
structured into three individual strategic business units (SBU’s) - mobile
services, broadband &telephone services (B&T) & enterprise services. The
mobile business provides mobile & fixed wireless services using GSM
technology across 23 telecom circles while the B&T business offers broadband
& telephone services in 94 cities. The Enterprise services provide end-to-end
telecom solutions to corporate customers and national & international long
distance services to carriers. All these services are provided under the Airtel
brand.

BUSINESS DIVISIONS
Bharti Airtel offers GSM mobile services in all the 23-telecom circles
of India and is the largest mobile service provider in the country,
based on the number of customers.

The group offers high speed broadband internet with a best in class network.
With landline services in 94 cities we help you stay in touch with your friends
& family and the World.
The group focuses on delivering telecommunications services and as an
integrated offering including mobile, broadband & national and international
long distance and data connectivity services to corporate, small and medium
scale enterprises.
 The company compliments its mobile and broadband telephone services with
national and international long distance services it has over 35,016 route
kilometers of optic fiber on its national long distance network, for international
connectivity to east, it has a submarine cable landing station at. For
international connectivity to the west, the company is a member of the South
East Asia - Middle East – West Europe - 4 (SEA-ME-WE-4) consortiums along
with 15 other global telecom operations.

Distribution network
Channel structure, members and their selection
Airtel has a wide & effectively spread channel structure all over India. The
channel structure is simple and effective. Complications are kept out in order to
make the overall process very effective and efficient.
CHANNEL STRUCTURE
This channel structure of Airtel is a regional one.

TERRITOTY MANAGER

Distributors Distributors Distributors Distributors

Tie Up Alternate Channels

Retailers

Tie Ups Products

Brand/ Store, etc.,
Distributors include one who handles, 1) Provisioning, 2) Documents, 3)
Operation back up, 4) Field sales executives.
Under these fall the retailers

Selection of channel members / dealers

Airtel follows a strict policy in selection of the dealers, and therefore it is

necessary to fulfill the following pre- requisites to be eligible to become a
dealer:

1) The dealers should have a sound financial background. The financial

capability of a dealer is solely depended on the discretion of the company
officials.

2) The dealers should have a good market reputation, since the dealers help the
customers in forming the first impression a customer has about the company.

3) The dealer should have a good previous track record, i.e. of timely
payments, no criminal background etc.4) The dealers should have good market
penetration. The companies ability to gain maximum customers in this era of
competition solely depends on the penetrate on the dealers have in the market.

5) The last criterion of dealers’ selection for Airtel is the area the dealers cover.
This would include different geographical areas which are covered by a dealer.
RESPONSIBILITIES AND FUNCTIONS OF THE
DEALERS

Airtel believes in “Customer Loyalty” and thus Airtel expects that their
dealers apart from selling paint products should perform the following
functions for better customer relations’ management.

1) Sales promotion through regular promotional schemes, road shows,

campaigns etc. the expenses incurred by the dealers is shared by the
company only if these activities are for promotion of the company
and not of the dealer.
2) Recruitment- done under the guidance of certain Airtel officials
3) Training and development of manpower with company assistance.
4) Servicing according to the size of orders
5) Customer relation management
6) Promote other products of the company
The dealer should be in regular touch with the customer, keep taking his
feedback and ensure maximum customer satisfaction. The dealer should also
try and convince the customer to try newer products of the company.

The dealer has to thus cater to 3 major areas:

Pre sale
Selling
Post sale services

SALES KIT

A dealer should carry the following in his sales kit :

➢ All products leaflets (adequate quantities)

➢ List of prospects with their addresses

 ➢ Information about the competition in the market

➢ Price list of APL products and corresponding prices of competitor

products.

➢ Shade cards

PERFORMANCE APPRAISAL

For the dealers:-

Airtel involves both external and internal agencies which conduct this
survey on a monthly basis.

MARGINS:-
The company gives margins at the time of sale of the product. The
margin varies according to the type of the product.

PROMOTIONAL ACTIVITIES

Airtel actively supports its cannel members with promotional activities.

Airtel helps performing these activities on a daily basis. Further these are
divide in to different levels which are
Zonal level-zonal staff is involved in this. These include various kinds of
road shows.
Circle level-This has the FM radio and local news papers.
National level-National dailies, cricket match sponsorships, tele media
Airtel collects feedback from its channel members on a daily basis.
Airtel rates/ranks its channel members on aspects such as:-
1) Dealers efficiency
2) Timely payment
3) Transporters behavior an excellent and strongly believes that they are
the best because of their channel members.
Airtel had market surveys with respect to their channel members and general
market surveys.

Company Background

Vodafone Limited

Vodafone, the world’s leading international mobile communications

company, has fully arrived in India. Vodafone Essar announced today that the
Vodafone brand will be launched in India from 21st September onwards.
The popular and endearing brand, Hutch, will be transitioned to Vodafone
across India. This marks a significant chapter in the evolution of Vodafone as a
dynamic and ever-growing brand. The brand change over the next few weeks
will be unveiled nationally through a high profile campaign covering all
important media.
Vodafone, the world’s leading mobile telecommunication company, completed
the acquisition of Hutchison Essar in May 2007 and the company was formally
renamed Vodafone Essar in July 2007. Asim Ghosh, Managing Director,
Vodafone Essar, said "We’ve had a great innings as Hutch in India and today
marks a new beginning for us. Not as a departure from the fundamentals that
created Hutch, but an acceleration into the future with Vodafone's global
expertise."
Harit Nagpal, Marketing and New Business Director, Vodafone Essar, said,
"This transition is probably the largest brand change ever undertaken in this
country and arguably as big as any in the world. It is even larger than our own
previous brand transitions as it touches over 35 million customers, across
400,000 shops and thousands of our own and our business associate’s
employees.”
The Vodafone mission is to be the communications leader in an
increasingly connected world – enriching customers’ lives, helping individuals,
businesses and communities is more connected by delivering their total
communication needs.
Vodafone's logo is a true representation of that belief - The start of a new
conversation, a trigger, a catalyst, a mark of true pioneering.

Vodafone established its presence in India in 1994 by acquiring the cellular

license for Mumbai. It now has operations in 16 circles accounting for 70% of
India's mobile customer base. With over 27.7 million customers, it is one of
India's most reputed telecom companies.
Vodafone, under the Hutch brand, over the years, has been named the 'Most
Respected Telecom Company', the 'Best Mobile Service in the country', and the
'Most Creative and Most Effective Advertiser of the Year'.

Hutchison Essar is now part of Vodafone - the world's leading international

mobile communications company. Vodafone now has operations in 26
countries across 5 continents and 36 partner networks with about 225 million
proportionate customers worldwide. Vodafone has tied up with Essar as its
principal joint venture partner for the Indian operation.
The Essar Group is one of India's largest corporate houses with interests
spanning the manufacturing and service sectors like Steel, Oil & Gas, Power,
Telecom & BPO, Shipping & Logistics and Engineering & Constructions. The
Group has an asset base of over Rs.20 billion (US$ 4.4.billion) and employs
over 4000 people.

Prepaid Outlets
Want to go Hutch and stay connected anytime, anywhere? Just visit a Hutch
outlet in your neighborhood and choose from a range of affordable Postpaid or
Prepaid connections.
VODAFONE SHOPS
Whether you're looking for a new Vodafone connection, or a fresh handset,
you'll find it here. You can also subscribe to any of our value added services or
get more information on them. Pay your bills, get your queries answered, and
lots more.
Hutch Shops are located at very convenient locations around the country. Select
your region to find one near you.
Mobile Vodafone Shops
Vodafone Shops are going on the move, to bring our services closer to you and
to provide faster online service, right at your doorstep. You can visit a Mobile
Vodafone Shop near you for:
➢ Postpaid connections and add on cards

➢ Prepaid connections and recharge cards

➢ Information on the latest talk plans

➢ Bill payments via cash, cheque or credit card

➢ Demos and activation of our Value Added Services

➢ Queries, SIM replacements and much more

Vodafone Teleshops
Did you know that a range of Vodafone services are available in your very own
neighborhood? Just walk into a Hutch Teleshop, just round the corner, for
anything you need.
At a Vodafone Teleshops you can buy a new postpaid or prepaid card, pay your
bills, reactivate your connection, and much more.

Distribution network

A supply chain is described that consists of all the parties and their
supplied activities that help us to create and deliver services to the final
customer. The front channels are specially kept in mind.
 ACTIVITIES:
 Order

 Handling

 Storage

 Display

 Promotion

 Selling

 Information and feedback.

The channel structure

Co.Business
or direct sales
head Indirect sales Misc. sales

G.M.
DSA/DST
Assist. Sales Manager
Manager
Sales Consultants TLS Dealers
Telemarketing Shop Owners
Executives
Executives Metro Shops
Telemarketing
Executives Field Executives Hutch Shops
Field Executives
The channel structure operates on the basis of segmentations provided,
namely:-

Prepaid Segmentation Postpaid Segmentation

IB Individual bronze – IB IB Individual bronze – IB

IB Individual Silver – IS IB Individual Silver – IS
IB Individual Gold – IG IB Individual Gold – IG
IB Individual Platinum– IP IB Individual Platinum– IP

COCP
(CO. Owned CO. Paid)
COIP
(CO. Owned Indv. Paid)
 Questionnaire
(Sales and Marketing department)
1. What type of sales organization structure do you possess?
2. What are the various channel structures in which you operate?
3. What are the various criterion/terms and conditions of selecting your channel
members?
4. What is the average Inventory Size you keep?
5. What is the average Order Cycle time?
6. What are the various modes of transportation adopted and cost incurred?
7. What are the methods of measurement and frequency of providing appraisals
to channel members?
8. What are the modes of by which you receive your payments:
i) Advance payment ii) Payment on Delivery iii) Credit payments
9. In case you provide the credit period, what is the time limit?
i) Upto15 days ii) 15-30 days iii) >30 days.
10. How frequently do you collect the feedback from your Channel members?
i) Weekly ii) Quarterly iii) Monthly

11. How will you rate and rank the following aspects of your Channel
Members:
 Excellent Very Good good Fair Poor
Dealer’s
Efficiency
Timely
payment
Transporters
behavior

12. What are the margins you provide to your Channel Members?
13. How do you assign targets to your sales personnel’s and what type of
targets?
14. Do you support your Channel Members by promotional activities?
a) YES b) NO

If Yes, i) Number of Promotions.

ii) Timing of Promotions.
iii) Quantity of Promotions.
15. Have you ever gone for market research?
a) YES b) NO

If Yes, write whom?

• Customers
• Channel Members
• General market survey

16. What type of market research was it?

What was your budget?
17. How frequently you go for market research?

-----------------------------------------------------------------------------------------------
Name of Respondent: ………………………………………………………

Name of Organization: ……………………………………………………

Designation: ………………………………………………………………

Address: ……………………………………………………. …………….

Tel. No.: ……………………………………………………. ……………

THANK YOU

Questionnaire
(For Dealer’s/Retailer’s/Franchisee)

1) What are the different brands which you keep in stock?

2) Which brand is most asked by the customers?

i) Airtel ii) Vodafone iii) other’s …………………

3) What is your average sales/month?

4) Which brand do you recommend to the customer and why?

5) Do you get any credit period from the company?

a) YES b) NO
If Yes, What is the credit period you get:
i) Upto 15 days ii) 15-30 days iii) >30 days

6) What is your average order size?

7) What are the margins that you get from the company?
8) What is the average order cycle time taken by the company?
i) < 5 days ii) 5-10 days iii) > 10 days
9) Where would you rank the services/assistance provided to you by the
company/s
Very Good Good Satisfactory Poor Very
Poor
Delivery Time

Quality
Maintenance
Incentives

Promotional
activities
Condition of
Product
Ease and
Flexibility of
placing Order
Transporter’s
Behavior
Customers
Orientation
Commercial
Terms
Services of Sales
Persons

10) How will you rate the efficiency of your sales persons
a) Very Good b) Good c) Satisfactory d) Poor e) Very poor
11) Does company provides you with any assistance by means of promotional
activities?
a) YES b) NO
If Yes, Numbers, Timing, Quantity of promotions.

12) Do you provide appraisals to your sales persons?

a) YES b) NO
If Yes, on what Parameters?

Person contacted: …………………………………………………………..

Name of dealer: ……………………………………………………………..
Address: ……………………………………………………………………..
Tel. No.: ……………………………………………………………………..

CONSUMER QUESTIONNAIRE

Q.1 How do you rate these connections in terms of Network?

V.Good Good Neutral Bad V.Bad

Vodafone 1 2 3 4 5
Airtel 1 2 3 4 5

Q.2 How do you rate these connection in terms of availability ?

V.Good Good Neutral Bad V.Bad

Vodafone 1 2 3 4 5
Airtel 1 2 3 4 5

Q.3 How do you rate these connection in terms of call rate?

V.Good Good Neutral Bad V.Bad

Vodafone 1 2 3 4 5
Airtel 1 2 3 4 5

Q.4 How do you rate their After Sales Services ?

V.Good Good Neutral Bad V.Bad

Vodafone 1 2 3 4 5
Airtel 1 2 3 4 5

Q.5 What do you think about employee’s behavior ?

V.Good Good Neutral Bad V.Bad

Vodafone 1 2 3 4 5
Airtel 1 2 3 4 5

Q.6 How do you rate these connection in terms of customer care services ?
 V.Good Good Neutral Bad V.Bad
Vodafone 1 2 3 4 5
Airtel 1 2 3 4 5

PERSONAL DETAILS :
NAME: _________________________________
AGE: ___________________________________
OCCUPATION: __________________________
MARITAL STATUS: _____________________

ANALYSIS

Rating of Airtel in terms of network

Rating of Vodafone in terms of network

Rating of Airtel in terms of availability

Rating of Vodafone in terms of availability

Rating of Airtel in terms of call rates

Rating of Vodafone in terms of call rates

Rating of Airtel in terms of after sales services

Rating of Vodafone in terms of after sales services

Rating of Airtel in terms of employees behavior

Rating of Vodafone in terms of employees behavior

Rating of Airtel in terms of Customer Care services

Rating of Vodafone in terms of Customer Care services