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  • Case Alpha TradingDeriving TO BESession #14 Aug 3rd 2015

  • Introduction - Alpha Trading Pvt LtdA traditional New Delhi based companyImports and sells mobile phones and automated cash counting machinesFrom its principals in TaiwanThe company has a office on Asaf Ali Road10 sales personsA network of 40 dealers across NCRThe dealers engage the retail customers for over the counter sales. *

  • Introduction - Alpha Trading Pvt LtdHukum Chand Jain is the 70 year old patriarch of Alpha TradingA traditional tight fisted business manDoes not believe in any sales of credit to DealersAdvance cheques, received from dealers against proforma invoices, are first cleared and then goods shipments are effected to the Dealers. *

  • Introduction- Alpha Trading Pvt Ltd*

  • Current Business Process

    Cash Machines: The A-1000 is a very high value and reliable product which is widely used in the office of Banks and Real Estate Developers where large amounts of cash is handled daily. The Real Estate market in NCR has been in a deep recession and the Orders from the Real Estate sector have practically dried up in the last one yearThe A-1000 a specialized high volume cash counting machine imported against specific dealer orders.Not sold ex-stock.There is a one month lead time to service such orders. The Dealers place orders on Alpha along with an advance cheque*

  • Current Business Process

    Mobile Phones:The Principals issue an Annual CatalogAlpha Trading enjoys a 40% discount per item on the list prices. Based on the demand estimate for the forthcoming quarter a revolving L/C is opened in value termsThere being a one week lead time, every Friday a PO is issued favouring the Principals against the Revolving L/C.The order booking process for mobile phones is very traditionalThe sales person first prepares a quote gets it approved from the dealer then he goes to accounts gets a proforma invoice raisedhe goes back to the dealer to get an order along with an advance cheque. *

  • Purchase: Cash Machines: All orders from dealers are consolidated on a monthly basis and a single L/C is opened along with a PO on Alpha Principals for imports of A-1000.The Principals require a one week lead time to service these orders. Mobile Phones : a quarterly demand estimate is prepared in consultation with Sales and Inputs are given to Finance for opening a Quarterly Revolving L/C. Based on marketing inputs weekly POs are issued to the Principals against the revolving L/C.All liason work with Principals concerning shipments is done by PurchasePOs are issued by this department*

  • Accounts:General accountingSalariesTaxationBank related workRaises invoices on customersAccepts paymentsOpens L/Cs to facilitate the imports.*

  • LogisticsStores: G/R of Goods Issue against Dealer OrdersCustoms Clearence of importlocal transportation G/R of incoming goodsinventory management of local stocksDispatch: receipt of goods from stores for each dealer orderensures the goods are transported to the dealer doorstep.

    *

  • Gross Margin and Net Profit Statement*

  • Statement of Expenses*

  • HR Details*

  • Transformation Options*Reduce NV & BV activitiesReduce TATIntegrated system exploit ITIncentives to SalesNew business channelsCall centreRationalize staffTie up with logistic companiesAdd product lines

  • AS-IS

  • Remove Dataflows NVARefer Process Template

  • Full Impact of Removing NVAs

  • Impact of Electronic Funds Transfer

  • IT Enabled To-Be