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Business And Political Factors Affect The Imperial Tobacco Company

Decent Essays

1. PRESENTATION OF ORGANIZATION:

ITC was established on the 24th August of 1910 under the name of Imperial Tobacco Company of India Limited. In the year 1970 name of the company was changed from Imperial Tobacco Company of India Limited to India Tobacco Company Limited. In 1974, it was again changed as I.T.C Limited. The company has its own portfolios of wide range of business like Cigarettes and Cigars, FMCG (Fast moving consumer goods), Personal care, Education, Brand Apparel, Stationery Products, Incense Sticks and Safety Matches, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business and Information Technology. Since the year 2001, Company is known as ITC Limited with full stops in the company name were removed.

1.1 Market(s) …show more content…

ITC has a quite favorable impact of political factors in the FMCG and Hotel business. Indian budget of tax regulation for the tobacco is 55%, which makes the company to spend the most the profit in the excuse duty. Advertising in the mass media is not allowed where as it can be done in the point of sale with a certain restrictions. Government of India also imposes the packing and labeling on the tobacco products like health-warning labels is to be pictorial and text for safety of the consumers. The cigarettes company operates in India with intolerable political factors, ruling party often changes the regulations keeping in mind about the safety of people but affects the companies like ITC business majorly. Which is also shown with potential customers are reducing day by day because of the price, results in lower sales. Apart from the government’s pressure, NGO’s in India are against the tobacco consumption and which in turn makes the selling of tobacco to consumers becomes tougher for the company. Though all the huge pressure company still able to make 65% of sales in the country and almost it’s the monopoly brand for the people for the consumption of

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