TABLE OF CONTENTS

CHAPTERS PARTICULARS PAGE NO

Introduction

1.1 Introduction

1 1.2 Objective of the Study

1.3 Significance of the Study

1.4 Scope of the Study

1.5 Methodology of the Study

1.6 Limitations of the Study

1.7 Chapterization

Industry Profile and Company profile

2.1 Industry Profile

2.2 Company Profile

2 2.3 Strategic Intent

2.4 Products

2.5 Marketing Mix

Organizational Structure, Department Profile

and Activities

3.1 Organizational Structure

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3.2 Detailed study of the department in which the

student is undergoing internship

 3.3 Activities done in day wise

Task and learning responsibilities

4.1 SWOT Analysis

4.2 Findings

4 4.3 Conclusion

4.4 Recommendations

4.5 Bibliography & Reference

 CHAPTER 1

INTRODUCTION

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 1.1 INTRODUCTION

The project report mainly focuses on the work culture of Pepsi Varun Beverages which is a FOBO

(franchise owned business operations) type of organization, competitive market of soft drinks industry

shows the competitiveness of its sales promotional strategies so as to retain its market share and to play

a major role in the market. Varun beverages as a franchise bottling unit of Pepsi earns a major share of

India’s market distributed all over country. As according to the supply chain is concerned there are

various modes of supply of products to the market so that the product reaches to the consumer at the

right place, at the right time and at a right price. The importance of maintaining a good supply chain is to

satisfy market demand with adequate supply i.e., to satisfy customer wants. Sales activities are boosted

by providing various sales promotional activities, which include sales promotional schemes that attract

the potential customers who are eager to make Pepsi as their brand of choice.

The effectiveness of the supply chain activities in the Ernakulam region has been given the attention

so that the customer especially the retailers who are the key players of the market get the product as and

when needed. Thus, to increase market share and to increase market competitiveness against its

competitor attractive schemes are launched to increase demand for goods and also to increase consumers

for its products. Since in FMCG sector demand for goods keeps on changing depending on market

conditions and fast changing consumer taste and preferences, one has to maintain a good knowledge

about changing market conditions and accordingly make strategies to maintain its market position.

Therefore, a good supply chain strategy has to be maintained so as to cater to market demand and also to

reach out to new potential customers. Strategies have to keep on changing according to market condition

and therefore various schemes are being used to maintain demand for the product. It has to prepare

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strategy so as to increase demand for its products and also to see that the demand and supply position is

maintained. So, in order to be competitive, one to has keep on analyzing its market position and

competitor, make strategies to hold on to its current market position and also to look out for new market

opportunities.

Thus, this project report mainly focuses on the study of supply chain activities of Pepsi, its market reach

and how they balance the supply activities with varying market demand.

The study tries to understand the major activities that involve in a FMCG sector regarding supply of

products to the market and hence finding out the major flaws and accordingly suggesting solutions to the

problems. The report also focuses on the market competition faced by Pepsi in Ernakulam and analyzing

the market position of Pepsi as against its competitor. It tries to analyze the feasibility of sales strategy

used by Pepsi as compared to its competitor.

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 1.2 OBJECTIVE OF THE STUDY

 PRIMARY OBJECTIVE

The primary objective of the study is to analyze the effectiveness of supply chain procedure of

Pepsi and to compare the market competitiveness of Pepsi against its competitor.

 SECONDARY OBJECTIVE

 Study of the supply chain activities of Pepsi.

 To give recommendations for improving the supply chain activities.

 Analyzing the proper functioning of schemes

 To check out the functioning of product display of Pepsi.

 Study of market share of Pepsi in Ernakulam.

 To study and analyze consumer behavior in soft drinks industry.

1.3 SIGNIFICANCE OF THE STUDY

An MBA student should be practical in all aspects, rather than just reading textual matters. This

internship study aids in understanding the practical aspects of theories learned in the classroom. This

research also assists in learning about current business problems in real life. This study is beneficial to

future managers because it puts them in real life situations. The internship study focuses on the

organization’s environment analysis. This is based on the assumption that the organization is controlled

by both its external and internal environment.

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1.4 SCOPE OF THE STUDY

The scope of the study is confined only to the market research and survey conducted. All efforts are

made to present an authentic view regarding taste and preferences of customers. This report provides

required information to the varied problems encountered in the industry.

1.5 METHODOLOGY OF THE STUDY

1. Channel through which the customers are getting the product:

 Grocery

 Eatery

 Convenience

 Institutional

2. Status of Cola in shops:

 Pepsi

 Coca Cola

 Mix

3. Chilling equipment found in the shop:

 VISI Cooler

 OYC

 Own Cooler

 Ice Box

4. Display status of Pepsi or Coke in shop:

 Glow Sign Board

 DPS

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 Wall Painting

 Counter

 Rack

 In The Shop

5. Average daily peak sales (in crates):

 Pepsi

 Coke

1.6 LIMITATIONS

 The research findings are based on the 793 retail shops visited, which belongs to Ernakulam

regiononly.

 The time taken to complete the research work was two months from the month of May to June,

when the sales are at peak and hence the data can fluctuate.

 Some of the data’s provided by the retailers may not be authentic as they had low level of

interest on company’s research work.

 Some of the retailers were providing wrong data by over quoting their sales as they wanted to

create good impression in front of the distributor.

 The research work is the outcome of the help from other persons also working in the

organization which are subjected to human error.

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 1.7 CHAPTERIZATION

Chapter 1: Introduction

 Objective of the Study

 Significance of the study

 Scope of the study

 Methodology

 limitations

 Chaptalization

Chapter 2: Industry, Company Overview

 Industry profile

 Company profile

 Strategic intent

Chapter 3: Organizational structure, Department profile, functioning

 Organizational structure

 Detailed study of the department

 Activities in day wise

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Chapter 4: SWOT Analysis, findings, conclusion, and recommendations

 Swot analysis

 Task, duties, responsibilities

 Findings

 Suggestion

 conclusion

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 CHAPTER 2

INDUSTRY PROFILE & COMPANY PROFILE

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 2.1 INDUSTRY PROFILE

Pepsi cola was in India from 1956 to 1961. It left the country as its products were not found acceptable

to the domestic market. But recently in 1990 it re-entered in to the Indian market where by Pepsi foods

limited entered in to join venture with Pepsi company international V.S and TATA concern Voltas and

the SIC 9 each of which have a rounded 25% of its output reserved for beverages. Four years since its

launch it had established 20 production facilities and three owned factories hacked by 1500 independent

sales distribution serving over a lakh of retailers Pepsi food sales are estimates at between 80 crores to

150 crores in 1996-97. PBPL was appointed as franchise by Pepsi foods limited in 1992.

The premises where it conducts as its activities was originally constructed by Camp-cola unit become

insolvent. As a result, Andhra Pradesh state financial corporation auctions the premises in 1990 it was

purchased by PBPL. It started production in 1991. Initially, it produced Mc. Dowell company’s brands

are thrill, rush, sprint, etc. commercial production started in Visakhapatnam from 1992 onwards in the

beginning four drinks were bottled and distributed namely Pepsi cola 7-up E.V, soda and since 1993

team is being bottled as continuous to be supplied from Guntur plan. Out of this Pepsi food limited

provides them with some benefited like providing to concentrate as well as by providing the advertising

materials etc. to the company.

PLANT LAYOUT

The layout of the bottling plant of Pepsi installed by the company confirm to the product line layout the

machines and the equipment are arranged according to the sequences of operations. The machine and

workers are specialized on the performance of specific operations such as preparation of clearing the

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bottles, filling the bottles, arraigning and bearing the bottles. All the operations approaches entail

continuous movement.

FACTORY CAPACITY

The installed capacity of PBPL IS 800 bottles per mints, the plan is also having 100 per mints for 1 liter

line. During the 9 months season the plan has double shifts. Each sift consists of 8hrs so during the

summer season the plant is run round the clock. This is because the demand reaches its peak these

summer months.

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 2.2 COMPANY PROFILE

PEPSI CO MISSION STATEMENT

Pepsi Company is overall mission to the increase the value of their shareholders investment. They

believe that their commercial success depends upon offering quality and value to their consumers and

providing products that are sage, wholesome, and economically efficient and environmentally sound.

Provide a fair return to their investors while adhering to the highest standers of integrity.

ORIGIN OF THE COMPANY

Soft drinks can trace their history to the mineral water found in natural springs. Bathing in natural

springs has long been considered a healthy thing to do and mineral water was said to have curative

powers. Scientist soon discovered that gas carbonium or carbon dioxide was behind the bubbles in

natural mineral water. The first marketed soft drinks appeared in the 7 th century. They were made from

water and lemon juice sweetened with honey. In 1676 the companies’ de-lemonades soft drinks.

THE SOFT DRINK BOTTLING INDUSTRY

Over 1500 U.S patents were filed for a cork, cap, drink bottle tops during the early days of the bottling

industry. Carbonated drink bottle is under a lot of pressure from the gas. Investors were trying to find the

best way to prevent the carbon dioxide from escaping. In 1892, the crown cork bottle seal was patented

by Willian painter a Baltimore machine shop operated. It was the first very successful method of

keeping the bubbles in the bottle.

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Read in over 100 countries with corresponding in all continents soft drinks international is the leading

English language magazine published in Europe devoted exclusively to the manufacture distribution and

marketing of all soft drinks and bottled waters.

Soft drinks international has an unrivalled pedigree since its launch in February 1888 as the British and

colonial mineral water trade journal the publication has appeared every month without fail, even though

the darkest days of two world wars. Th the 12th century soft drinks have evolved into one of the most

innovative of fast-moving consumer goods. In keeping with its international title, the journal has a team

of seven overseas corresponding based in north and south America, Europe, Asia. Their news reportage

accompanied by in depth features and analysis distinguishes soft drinks international from other

beverages.

Before the onset of summer two capable hands are given as assistants to the sales managers, and in

addition to those eight other sales executives are recruited to hammer out the volatile market.

Visakhapatnam is assisted by four sales supervisors. The area managers of Visakhapatnam and

Srikakulam are assisted by only the two sales supervisors each. The management of the unit is putting

extra emphasis on Visakhapatnam district. One reason for this is that Visakhapatnam is maintaining the

fastest growth rate in the entire Asian continents.

Any organization must decide how many products it would offer. This is a recurring problem as the

market changes. Changes in people’s taste, patience, competition, growth and new technology come into

existence. The problem of this question comes when there are additional product lines. In case of soft

drinks, the retail outlets may desire to buy a verity of soft drinks preferable from some company source.

The bottling company as the retail outlet need only a small quantity of one brand of cold drink. If the

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becomes necessary of offer several flavors so that the sales may seem that sufficient on each call to

justify the expenses of making the call.

HISTORY OF PEPSI:

PepsiCo, Inc. was founded by Donald M. Kendall, President and Chief Executive Officer of Pepsi-

Cola and Herman W. Lay, Chairman and Chief Executive Officer of Frito-Lay, through the merger of

the two companies.

Pepsi-Cola was created in the late 1890s by Caleb Bradham, a New Bern, N.C. pharmacist. Frito-

Lay, Inc. was formed by the 1961 merger of the Frito Company, founded by Elmer Doolin in 1932, and

the H. W. Lay Company, founded by Herman W. Lay, also in 1932. Herman Lay is chairman of the

Board of Directors of the new company; Donald M. Kendall is president and chief executive officer. The

company reported sales of $510 million and had 19,000 employees.

Major products of the companies are:

 Pepsi-Cola Company - Pepsi-Cola (formulated in 1898), Diet Pepsi (1964) and Mountain Dew

(introduced by Tip Corporation in 1948).

 Frito-Lay, Inc. - Fritos brand corn chips (created by Elmer Doolin in 1932), Lay's brand potato

chips (created by Herman W. Lay in 1938), Cheetos brand cheese flavored snacks (1948),

Ruffles brand potato chips (1958) and Rold Gold brand pretzels (acquired 1961).

 Mountain Dew launches its first campaign "Yahoo Mountain Dew ... it'll tickle your innards."

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Major Milestones of Pepsi in subsequent years:

1966 Milestones:

 Doritos brand tortilla chips are introduced. They are destined to become the most popular snack

chip in the U.S.

 Pepsi enters Japan and Eastern Europe.

1967 Milestones:

 Pepsi Generation advertising, "Come Alive! You're in the Pepsi Generation" campaign that

named and claimed a whole generation (1963-67), introduces a new theme: "Taste that beats the

others cold. Pepsi pours it on!"

1968 Milestones:

 North American Van Lines (NAVL), a premier transportation company, joins PepsiCo. NAVL

remains a strong contributor to PepsiCo until it is divested in 1984.

 1969 Milestones:

 Bold, modern Pepsi-Cola packaging using red, white and blue is introduced. "You've got a lot to

live, Pepsi's got a lot to give," becomes the advertising theme.

 Frito-Lay introduces Funyuns brand onion flavored snacks.

 Mountain Dew changes its slogan to "Get That Barefoot Feelin' Drinkin' Mountain Dew."

1970 Milestones:

 PepsiCo sales pass the $1 billion mark. The company has 36,000 employees.

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  PepsiCo moves from New York City to new world headquarters in Purchase, N.Y. The new

corporate headquarters feature a building by one of America's foremost architects, Edward

Durrell Stone (1902-1978), set on a campus of 144 acres amid an outdoor sculpture garden.

 W.C. Fritos is introduced as Frito-Lay's new advertising mascot.

 Wilson Sporting Goods, a top name in sports equipment, joins PepsiCo. It is divested in 1985.

 Pepsi introduces the industry's first two-liter bottle.

 Pepsi is the first company to respond to consumer preference with lightweight, recyclable, plastic

bottles.

1971 Milestones:

 PepsiCo Chief Executive Officer Donald M. Kendall assumes the position of chairman of the

Board of Directors on the retirement of Herman W. Lay. Lay maintains an active role in the

corporation until his death December 6, 1982.

 Andrall E. Pearson is appointed president of PepsiCo, a position he holds until his retirement in

1984.

1972 Milestones:

 Mountain Dew, acquired by Pepsi-Cola in 1964, switches its advertising and package graphics

from hillbillies to action-oriented scenes. Sales climb and Mountain Dew will become one of the

10 best-selling soft drinks in the United States.

 Don Kendall announces agreement making Pepsi-Cola the first foreign product sold in the then

U.S.S.R. PepsiCo is given exclusive rights to import Stolichnaya Russian vodka in the U.S.

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  Foods International, later called PepsiCo Foods International (PFI) and subsequently named

Frito-Lay International, is established to market snack foods around the world.

 The third Mountain Dew slogan appears "Put A Little Yahoo in Your Life."

1974 Milestones:

 PepsiCo sales pass the $2 billion mark.

 Pepsi-Cola becomes the first American consumer product to be produced, marketed and sold in

the former Soviet Union.

1975 Milestones:

 PepsiCo has 49,000 employees.

 Pepsi Light, with a distinctive lemon taste, is introduced as an alternative to traditional diet colas.

1976 Milestones:

 The Pepsi Challenge, introduced in Dallas, Tex. in 1975, becomes a national campaign. Around

the nation, consumers select Pepsi-Cola as the best tasting cola.

 PepsiCo adopts Code of Worldwide Business Conduct.

 Pepsi-Cola becomes the single largest selling soft drink brand sold in U.S. supermarkets.

Advertising campaign is "Have a Pepsi day!" "Puppies," becomes one of America's best-loved

ads.

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1977 Milestones:

 PepsiCo acquires Pizza Hut; Inc. Pizza Hut was founded in 1958 by Dan and Frank Carney. It is

spun off along with Taco Bell and KFC businesses as Tricon Global Restaurants, Inc. in 1997.

 PepsiCo passes the $3 billion mark in sales.

1978 Milestones:

 Taco Bell is acquired. Taco Bell was established in the mid-1960s by Glen Bell. It is spun off

along with Pizza Hut and KFC businesses as Tricon Global Restaurants, Inc. in 1997. Later

becomes YUM.

1979 Milestones:

 Opening of PepsiCo Research and Technical Center in Valhalla, N.Y.

 PepsiCo reaches $5 billion in sales.

1980 Milestones:

 PepsiCo Food Service International (PFSI) is formed to focus on overseas development of

restaurants.

 PepsiCo now has 111,000 employees.

 First presentation of the international Donald M. Kendall Bottler-of-the-Year Award.

 Pepsi is #1 in sales in take-home market.

1981 Milestones:

 PepsiCo passes $7 billion in sales.

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  PepsiCo and China reach agreement to manufacture soft drinks, with production beginning in

1982.

 PepsiCo launches PepsiCo Food Systems (PFS), its restaurant supply company. PFS is sold to

AmeriServe in 1997.

1982 Milestones:

 Pepsi Free and Diet Pepsi Free, the first major brand caffeine-free colas, are introduced.

 Inauguration of the first Pepsi-Cola operation in China.

1983 Milestones:

 The Bottler Hall of Fame is established to recognize the achievement and dedication of

international bottlers.

1984 Milestones:

 PepsiCo is restructured to focus on its three core businesses: soft drinks, snack foods and

restaurants. Transportation and sporting goods businesses are sold.

 Wayne Calloway becomes president of PepsiCo.

 Diet Pepsi is reformulated with 100% NutraSweet.

 Slice and Diet Slice, the first major soft drinks with fruit juice, are introduced.

 Pepsi-Cola makes advertising history as Michael Jackson and his brothers usher in a new

generation of Pepsi-Cola advertising in two of the most eagerly-awaited television commercials

featuring music marketing. Pepsi becomes "The Choice of a New Generation."

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  Herman W. Lay Award of Excellence established at Frito-Lay to recognize world-class selling

excellence.

1985 Milestones:

 PepsiCo is now the largest company in the beverage industry. The company has revenues of

more than $7.5 billion, more than 137,000 employees.

 Pepsi-Cola products are available in nearly 150 countries and territories around the world. Snack

food operations are in 10 international markets.

 The cola war takes "one giant sip for mankind," when a Pepsi "space can" is successfully tested

aboard the space shuttle.

 Pepsi distributes products in China.

1986 Milestones:

 Wayne Calloway becomes chairman of the Board of Directors and chief executive officer in May

when Donald M. Kendall retires.

 PepsiCo purchases Kentucky Fried Chicken, the leader in the quick service chicken market. KFC

was founded by Colonel Harland Sanders. Colonel Sanders began franchising the company in

1952. KFC is spun off along with Pizza Hut and Taco Bell businesses as Tricon Global

Restaurants, Inc. in 1997.

 PepsiCo purchases Seven-Up International, the third largest franchise soft drink operation

outside the United States.

 PepsiCo passes $10 billion in sales.

 PepsiCo is listed on the Tokyo stock exchange.

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  Diet Pepsi gets a new logo.

1987 Milestones:

 “Mustang," a Diet Pepsi commercial, becomes the first ad ever to appear in a home video

cassette. The cassette, "Top Gun," becomes the largest-selling video ever.

 Pepsi sponsors tours of major music stars, including Miami Sound Machine, David Bowie and

Tina Turner.

1988 Milestones:

 Pepsi-Cola International enters a landmark joint venture agreement in India.

 Hostess Frito-Lay, a major new partnership in Canada, is formed with Hostess Foods in Canada.

 "Chase," a four-part Pepsi ad featuring Michael Jackson in his first-ever episodic commercial,

airs during the Grammy awards and becomes the most-watched commercial in advertising

history.

 Worldwide retails sales of Doritos brand tortilla chips hit $1 billion. It is the world's largest

selling snack chips brand.

1989 Milestones:

 PepsiCo acquires Walkers Crisps and Smith Crisps, two of the United Kingdom's leading snack

food companies.

 PepsiCo enters top 25 of Fortune 500 ranking with sales of $15.4 billion, it is number 23. The

company has more than 300,000 employees.

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1990 Milestones:

 PepsiCo signs the largest commercial trade agreement in history with the Soviet Union.

 PepsiCo profits exceed $1 billion for the first time.

1991 Milestones:

 PepsiCo acquires an equity interest in Wedel SA, the leading manufacturer of chocolate and

confectionery in Poland Snacks now include operations in 23 countries.

 Pepsi-Cola introduces a new logo, its eighth in 93 years. Advertising features rap singer MC

Hammer.

 Pepsi-Cola forms joint venture with Thomas J. Lipton Co. to develop and market tea-based

drinks.

1992 Milestones:

 PepsiCo purchases an equity interest in California Pizza Kitchen. It is sold in 1997.

 Frito-Lay and General Mills agree to merge snack food businesses in Europe.

 Pepsi-Cola begins distribution of Lipton's line of ready-to-drink teas nationwide.

1993 Milestones:

 Both PepsiCo beverages and snack food operating profits pass the $1 billion mark.

 Pepsi introduces "The Cube," an innovative 24-can multipack that satisfies growing consumer

demand for convenient large size soft drink packaging.

 Pepsi-Cola International introduces Pepsi Max, a soft drink with unique blend of sweeteners that

delivers maximum cola taste in a no-sugar product.

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  Pepsi-Cola introduces Aquafina bottled water into test market.

1994 Milestones:

 Pepsi-Cola International acquires Indian company, its first big bottling plant in Bombay.

 PepsiCo and Starbucks form the North American Coffee Partnership to jointly develop ready-to-

drink coffee beverages.

 Pepsi-Cola licenses the Citrus Hill trademark from The Procter & Gamble Co. to launch a line of

fountain juices and drinks.

 Wake Forest University names its School of Business and Accountancy in honor of Wayne

Calloway.

 PepsiCo sales reach $30.4 billion. There are 470,000 employees worldwide, making PepsiCo the

third largest employer.

1995 Milestones:

 Pepsi-Cola introduces "Nothing else is a Pepsi" theme line.

 7Up International launches 7UP Ice Cola, a new clear cola.

 PepsiCo will introduce Lay's brand potato chips in 20 markets throughout the world.

 PepsiCo is on-line at http://www.pepsico.com

1996 Milestones:

 Pepsi-Cola launches Pepsi World at http://www.pepsi.com

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  Pepsi-Cola domestic and international operations combined into Pepsi-Cola Company.

International and domestic snack food operations combined into one business unit called Frito-

Lay Company.

 PepsiCo announces plans to spin off its restaurant businesses as an independent publicly-traded

company sell its food distribution company and focus on its core beverage and snack food

businesses. The spin-off is completed October 6, 1997. Shareholders receive one share in the

new restaurant company, Tricon Global Restaurants, Inc., for every 10 shares they hold in

PepsiCo, Inc.

 PepsiCo is now a $20 billion company with approximately 140,000 employees worldwide.

 Roger Enrico succeeds Wayne Calloway as chief executive officer and chairman of the Board of

Directors.

1997 Milestones:

 Pepsi-Cola North American bottling operations become a separate unit called The Pepsi-Cola

Bottling Co.

 Frito-Lay announces plans to buy the 104-year-old snack, Cracker Jack, a candy-coated mix of

popcorn and peanuts from Borden Foods Corp.

 Pepsi-Cola kicks off the celebration of its 1998 100th Anniversary with first worldwide bottler’s

conference, held in Hawaii. The event is held during the same time as first bottler's conference.

1998 Milestones:

 PepsiCo Chairman and CEO Roger A. Enrico donate his salary to provide scholarships for

children of PepsiCo employees.

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  Former Chairman and CEO Wayne Calloway die on July 9th. He joined PepsiCo in 1967

becoming its Chairman and CEO in 1986.

 PepsiCo acquires Tropicana Products from Seagram Company Ltd., the biggest acquisition ever

undertaken by PepsiCo. Tropicana was founded in 1947 by Anthony Rossi. Its major brand is

Tropicana Pure Premium Juices.

1999 Milestones:

 In March, The Pepsi Bottling Group, the world's largest Pepsi bottler, begins trading on the New

York Stock Exchange. It is listed under the symbol PBG. The $2.3 billion public offering is

among the biggest initial public offerings in stock market history.

 Steve Reinemund named president of PepsiCo.

 Tropicana juices are entering the huge India market for the first time. Spearheaded by Tropicana

Asia Pacific, orange juice will appear in the New Delhi and Bangalore markets.

 Frito-Lay introduces a new corporate logo.

2000 Milestones:

 Pepsi-Cola teams up with Yahoo Inc., the biggest web navigation company, in a multimedia

marketing campaign aimed at teens and young adults.

 Aquafina brand bottled water becomes the best-selling brand of single-serve bottled water in US

retail channels.

 Pepsi-Cola launches "Sierra Mist" a caffeine-free, lemon/lime soda.

 PepsiCo, Inc. and The Quaker Oats Company reached an agreement to merge.

 PepsiCo sales are $20 billion and the company has 125,000 employees at year end.

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  PepsiCo launches Diversity@work, http://www.pepsico.com/diversity website.

2001 Milestones:

 Pepsi-Cola launches the bold new Mountain Dew Code Red nationwide. It is Mountain Dew's

first line extension since the introduction of Diet Mountain Dew in 1988.

 May 2 -The Board of Directors of PepsiCo, Inc. elected Steven S Reinemund chairman of the

board and chief executive officer, succeeding Roger Enrico who will become vice chairman. The

board also elected Indra K. Nooyi as a director and gave her the additional title of president of

PepsiCo in addition to CFO.

 SLAM, the orange brand Mirinda, is launched in Italy.

2002 Milestones:

 Gatorade introduces new Gatorade ICE in three flavors- Orange, Lime and Strawberry.

 Gatorade turns 35. It was created in 1960s to help performance of Florida Gators football team

and now is the leading sport drink.

 PepsiCo reorganizes to unite all North American beverage operations, including Pepsi-Cola,

Tropicana and Gatorade, into one new division -- PepsiCo Beverages and Foods North America.

 PepsiCo announces $5 billion share repurchase program.

 Brand Pepsi has a new look.

2003

 Pepsi announces four-year sponsorship agreement with the UK Football Association.

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  PepsiCo creates PepsiCo International, the business that will unite all international snack,

beverage and food units in an effort to drive faster growth and improved profitability around the

world.

 Pepsi–Cola trademark turns 100 years old.

2004 Milestones:

 Frito-Lay’s 24-count multi-Sack variety pack won the Institute of Packaging Professional's

(IoPP) Integrity Award, one of the industry’s top awards, at this year’s AmeriStar Packaging

Awards.

 Pepsi-Cola to launch Pepsi Edge, the first full-flavored cola with 50% less sugar, carbohydrates

and calories than regular cola.

 PepsiCo publishes first Corporate Citizenship report in its 2003 Annual Report.

2005 Milestones:

 PepsiCo Celebrates 40th Anniversary

 PepsiCo International announced the appointment of Pioneer Foods, a leading South African

food and beverage company, as its franchisee in the Republic of South Africa.

 PepsiCo Donates $2 Million to Pakistan Earthquake Victims

 Pepsi Partners with Harvey's, Swiss Chalet and Milestone's Restaurants

2006 Milestones:

 PepsiCo India re-launches Mirinda.

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  In selected cities across the United States, Pepsi distributes more than three million free cans of

newly reformulated Diet Mountain Dew, marking the largest single-day sampling effort in

company history

 Starbucks and PepsiCo sign a distribution agreement for Ethos Water

 Indra Nooyi named Chief Executive Officer of PepsiCo as of October 1, 2006

2007 Milestones:

 PepsiCo signs Maria Sharapova for International endorsement of Gatorade and Tropicana

 Tropicana launches Tropicana Healthy Heart with Omega-3s, the first national orange juice to

include omega-3s

 Ruffles unveils new packaging to reflect its switch to 100% pure sunflower oil

 Aquafina launches Aquafina Alive—a low calorie, vitamin-enhanced water beverage

 Quaker Oats debuts new Quaker Life Chocolate Oat Crunch Cereal

 Flat Earth Fruit and Vegetable Crisps hit stores nationally

 Fritos Corn Chips celebrates 75th Anniversary with retro packaging

 Near East celebrates its 45th Anniversary with a recipe contest

 Tropicana launches Tropicana Fruit Squeeze, a 20-calorie drink with real Tropicana fruit juice

 Lay’s launches ‘Share the Joy’ program to help the Make a Wish Foundation raise funds

 Pepsi-Cola North America launches Diet Pepsi MAX

 New Quaker Mini Delights launches offering great taste and portion control in a satisfying

serving of mini snack cakes

 Diet Pepsi Jazz introduces new Caramel Cream flavor

 Grandma’s Cookies offering limited-edition flavors for spring: Iced Lemon and Sugar flavors

28
  Walkers is the first major food brand in the world to display a carbon footprint reduction logo on

its packs

 PepsiCo Announces 25% Dividend Increase and Raises Share Repurchase Target; Nooyi

Assumes Chairman Title

 EPA Names PepsiCo 2007 ENERGY STAR(R) Partner of the Year

 PepsiCo Makes Largest Corporate Purchase of Renewable Energy Certificates

 Pepsi launches “Design Our Pepsi Can” National Promotion

 Tropicana unveils New Organic Line – Tropicana Organic QTG facility earns an Energy and

Environmental Design (LEED) “Gold” certification from the U.S. Green Building Council

 PCNA and Frito-Lay launch “Shrek the Third” National Summer Promotion

 Indra Nooyi receives the Outstanding American by Choice Award.

PEPSI CO OVERVIEW:

The company consists of Frito-Lay North America, PepsiCo Beverages North America, PepsiCo

International and Quaker Foods North America. PepsiCo brands are available in nearly 200 countries

and territories and generate sales at the retail level of about $92 billion.

Some of PepsiCo's brand names are more than 100-years-old, but the corporation is relatively young.

PepsiCo was founded in 1965 through the merger of Pepsi-Cola and Frito-Lay. Tropicana was acquired

in 1998 and PepsiCo merged with The Quaker Oats Company, including Gatorade, in 2001.

PepsiCo offers product choices to meet a broad variety of needs and preference -- from fun-for-you

items to product choices that contribute to healthier lifestyles.

29
 PepsiCo’s mission is “To be the world's premier consumer Products Company focused on convenient

foods and beverages. It seeks to produce healthy financial rewards to investors as they provide

opportunities for growth and enrichment to their employees, their business partners and the communities

in which they operate. And in everything they do, it strives for honesty, fairness and integrity.”

SHAREHOLDERS:

PepsiCo (symbol: PEP) shares are traded principally on the New York Stock Exchange in the United

States. The company is also listed on the Amsterdam, Chicago and Swiss stock exchanges. PepsiCo has

consistently paid cash dividends since the corporation was founded.

CORPORATE CITIZENSHIP:

At PepsiCo, it believes that as a corporate citizen, it has a responsibility to contribute to the quality of

life in its communities. This philosophy is expressed in its sustainability vision which states: “PepsiCo’s

responsibility is to continually improve all aspects of the world in which they operate – environment,

social, economic -- creating a better tomorrow than today.”

Its vision is put into action through programs and a focus on environmental stewardship, activities to

benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable

company.

PEPSI CO HEADQUARTERS:

PepsiCo World Headquarters is located in Purchase, New York, approximately 45 minutes from New

York City. The seven-building headquarters complex was designed by Edward Durrell Stone, one of

30
America's foremost architects. The building occupies 10 acres of a 144-acre complex that includes the

Donald M. Kendall Sculpture Gardens, a world- acclaimed sculpture collection in a garden setting.

The collection of works is focused on major twentieth century art, and features works by masters such as

Auguste Rodin, Henri Laurens, Henry Moore, Alexander Calder, Alberto Giacometti, Arnaldo

Pomodoro and Claes Oldenburg. The gardens originally were designed by the world-famous garden

planner, Russell Page, and have been extended by François Goffin. The grounds are open to the public,

and a visitor's booth is in operation during the spring and summer.

31
 2.3 STRATERGIC INTENT

Vision:

“Being the best in everything we touch and handle.”

Mission:

“Continuously excel to achieve and maintain leadership position in the chosen businesses; and delight

all stakeholders by making economic value additions in all corporate functions.”

2.4 PRODUCTS

PepsiCo India’s expansive portfolio includes iconic refreshment beverages Pepsi, 7UP, Mirinda and

Mountain Dew, in addition to low calorie options– Diet Pepsi and 7UP Light, hydrating and nutritional

beverages such as Aquafina drinking water, isotonic sports drinks - Gatorade, and 100% natural fruit

juices and juice-based drinks – Tropicana and Slice. Other local brands – Lehar Everess Soda, Dukes

Lemonade and Mangola complete their diverse spectrum of brands.

32
 PepsiCo’s snack food company, Frito-Lay, is the leader in the branded potato chip market and was

amongst the first companies to eliminate the use of trans fats and ‘msg’ in its products. It manufactures

Lay’s Potato Chips; Cheetos extruded snacks, Uncle Chips and traditional namkeen snacks under the

Kurkure and Lehar brands. Quaker Oats, Lehar Lites, low fat and roasted snack options enhance the

choices available to the growing health and wellness needs of consumers.

ABOUT RKJ GROUP:

It can be said with absolute certainty that the RKJ Group has carved out a special

niche for itself. The services touch different aspects of commercial and civilian

domains like those of Bottling, Food Chain and Education. Headed by Mr. R. K.

Jaipuria, the group as on today can lay claim to expertise and leadership in the fields of

education, food and beverages.

The business of the company was started in 1991 with a tie-up with Pepsi Foods Limited to

manufacture and market Pepsi brand of beverages in geographically pre-defined territories in which

brand and technical support was provided by the principal’s viz., Pepsi Foods Limited. The

manufacturing facilities were restricted at Agra Plant only.

VARUN BEVERAGES LTD:

Varun Beverages Ltd. is the flagship company of the group. The group also became

the first franchisee for Yum Restaurants International [formerly PepsiCo Restaurants

(India) Private Limited] in India. It has exclusive franchise rights for Northern &

33
Eastern India. It has total 46 Pizza Hut Restaurants & 1 KFC Restaurant under its company.

It diversified into education by opening their first school in Gurgaon under management of Delhi

Public School Society. The schools of the group are run under a Registered Trust namely Champa Devi

Jaipuria Charitable Trust.

Companies are medium sized, professionally managed, unlisted and closely held between Indian

Promoters and foreign collaborators.

The group added another feather to its cap when the prestigious PepsiCo “International Bottler of the

Year” award was presented to Mr. R. K. Jaipuria for the year 1998 at a glittering award ceremony at

PepsiCo’s centennial year celebrations at Hawaii, USA. The award was presented by Mr. Donald M.

Kendall, founder of PepsiCo Inc. in the presence of Mr. George Bush, the 41st President of USA, Mr.

Roger A. Enrico, Chairman of the Board & C.E.O., PepsiCo Inc. and Mr. Craig Weatherup, President of

Pepsi Cola Company.

BUSINESS SEGMENTS OF RKJ GROUP:

The RKJ Group is divided into three business segments- Beverage, Food and Education. It has a

leading market position in each of its three business segments. A balanced portfolio produced a solid

business performance. Products and services which look to the future ensure that they will be well-

placed in growth markets.

34
BEVERAGES:

Indian Beverages industry’s size is Rs. 8000 Crores and it is dominated by two players viz Pepsi &

Coke only. This high-profile industry has lot of potential for growth as per capita consumption in India

is 8 bottles a year as compared to 20 bottles in Sri Lanka, 14 in Pakistan, while 12 bottles a person in

Nepal.

The RKJ group is India's leading supplier of retailer brand carbonated and non-Carbonated soft

drinks, with beverage manufacturing facilities in India and Nepal. Its experience in the beverage

industry dates back to the sixties when it had the first franchise at Agra.

The group manufactures and markets Carbonated and Non-Carbonated Soft Drinks and Mineral

Water under Pepsi brand. The various flavors and sub-brands are Pepsi, Mirinda Orange, Mirinda

Lemon, Mountain Dew, 7UP, Slice Mango, Slice Orange, Evervess Soda and Aqauafina.

35
 It has the license to supply beverages in the territories of Western U.P., part of M.P., half of Haryana,

whole of Rajasthan, Goa, 3 districts of Maharashtra, 9 districts of Karnataka and whole of Nepal. The

group has in total 18 bottling plants in India & Nepal and is responsible for producing and marketing

44% of Pepsi requirement in India.

FOOD:

The last decade has been a period of dynamic growth for non-alcoholic drinks and has witnessed

completely new segment of the food market in India taking shape. To capitalize on the RKJ

group’s significantly important relationship with Pepsi Foods, it decided to venture into Foods

sector, which is second largest business for Pepsi all over the world. Fast food is the most

happening things across the world.

The group became the first franchisee for Yum Restaurants International [formerly PepsiCo

Restaurants (India) Private Limited] in India. It has exclusive franchise rights for Northern & Eastern

India. Out of 56 operational Pizza Hut restaurants in the country 27 restaurants are owned and run by its

company. These restaurants are located at Defence Colony, Alaknanda, Vikas Puri, Green Park, Karol

Bagh, New Friends Colony, Connaught Place, Basant Lok, Greater Kailash, Jaipur (2), Agra, Ernakulam

(2), Faridabad (2), Chandigarh (2), Ludhiana, Jallandhar, Amritsar, Gurgaon (3), Kushambi (Ghaziabd)

and Kolkatta (2).

36
 All these restaurants are making good profits & are dominating the market. The name of business

entity is Devyani International Private Limited.

Ice Creams under “Candia” brand:

The group has its presence in the Ice Cream segment since 1991, when it started manufacturing

and marketing Ice Cream under the brand name of “Gaylord” in the state of U.P.

During 1996 it sold its brand to Brooke Bond and started supplying Ice Cream to Hindustan Lever as

their Ice Cream sourcing plant. After working for 10 years in this field, during 2003 it has launched its

own brand in technical and marketing collaboration with Candia of France.

CARBONATED SOFT DRINK INDUSTRY:

INDUSTRY STRUCTURE:

The three main teams in the in the production and the distribution of the carbonated soft drinks are

the concentrate producers, the bottlers and the retailers who are actually responsible for the sales of the

product. The concentrate producers produce the concentrate and them sell it to the bottlers, who adds a

sweetener to the carbonated water and then pack it in the bottles and cans. These bottlers can be either

the Pepsi itself or the franchisees who work on the behalf of Pepsi. One half of the sale of the Pepsi is

through the company owned bottlers (COBO) and other half of the sale is through the franchisees

bottlers (FOBO). FOBO’s had the right to the product and then sells it in the defined territory and is not

allowed to market the competitive brand. Then through the distribution channel the product reaches to

the retailer who finally sells the product to the consumers.

37
 The principal retail outlets for the CSD are the supermarkets, convenience stores, fountain services and

thousands of small outlets.

PURCHASE AND CONSUMPTION PATTERN:

Industry research suggests that the purchase of the soft drink is unplanned, i.e., sometimes it is more

and sometimes it is less depending on the demand in the market, the schemes that are provided to the

retailers, the displays provided, and the incentives given and on the relationship of the salesman and the

retailers.

The sale of soft drinks is a seasonal affair. The sale increases tremendously during the summer

season and falls down during the winter season.

MANUFACTURING PROCESS:

Water:

The water is available through the municipal supplies or through the borings. This water is then

treated by reverse osmosis process to obtain germ free water. The water is also treated with some

chemicals so that the water that is obtained is pure and ready for consumption. The water is also passed

through the sand in order to filter it. This water thus obtained is soft and can be used for manufacturing

process of the carbonated soft drinks. The same water is also used for washing of the used bottles.

Sugar Syrup Preparation:

The next step is the preparation of the sugar syrup, which is further used to prepare the final

concentrated syrup. In this the sugar is added to the germ-free water and heated to about 85 degrees of

temperature in a steam jacketed stainless steels tank of adequate capacity with an agitator, so that the

sugar gets well dissolved in the water. The solution is boiled for about 20 minutes so that the syrup gets

38
bit thick. This also kills the germs present in the water. The syrup is then filtered through the filter press

at a high speed so that further impurities can be removed from the syrup. Then this syrup is cooled to a

definite temperature with the help of a S.S Plant Heat Exchanger.

Finished Syrup:

In the preparation of the finished syrup, additional water is added to the raw syrup in the correct

quantity along with some essence. The solution is mixed thoroughly with an agitator provided in the S.S

tank and allowed to mature according to the specified time limit. This time differs for each flavor.

Beverage Preparation:

In this step the ready syrup is passed through the intermix unit where more water is added to the

syrup to prepare the final product. Now this beverage is chilled to a very low temperature and is pumped

into the saturator carbonator. Carbonator is the stainless-steel vessel consisting of a number of S.S film

plates. This vessel is a pressure vessel where high pressure is maintained, so that the CO2gets well

mixed with the cold water. The S.S plates forms a very thin film of the beverage on the plates. After this

the beverage is filled in the glass bottles under high pressure, so that no air remains inside the bottles

because this can spoil the soft drink.

Filling:

Filling of the beverage in the bottles is done through the automatic counter pressure filters, which fills

the bottles at a high speed, and the bottles are crowned with the caps automatically.

Washing of the bottles:

Washer, which consists of the soaking compartments. These compartments contain caustic soda and

a number of jets where soft water and hot the bottles, which come back from the markets, are washed

with the help of bottle caustic soda solutions are used to clean the bottles. These cleaned bottles are then

inspected before they go for refilling. They are passed through the bottle conveyer. Then they are passed

39
through the Lim-Light inspection machine and then through the Mit-Mirror machine for finding out the

cracks. After all these inspections the bottles are sent for refilling. The bottles are again checked and

then packed in the groups of 24.

Quality control:

The success of any industry depends on the quality of the product it provides. Therefore, quality

measurements are done on each step-in order to ensure that the product that finally reaches the consumer

is fit for consuming. The packed bottles are checked for the gas content, sugar content, organic and for

the microbiological quality. Here the quality invariable remains the constant because of the continuous

on –line checking.

2.5 MARKETING MIX

PRODUCTS:

Pepsi makes Carbonated Soft Drinks i.e., cola and non-cola flavor.

Core Brands:

 PEPSI

 MIRINDA LEMON

 MIRINDA ORANGE

 SLICE

 MOUNTAIN DEW

 7 UP

 AQUAFINA

40
  SODA

PACKAGES:

 Two types: single serve and multi serve

 67 packages sizes and types

 Materials: glass, plastics & cans

 Packages may be returnable or non-returnable.

41
 CHAPTER 3

ORGANIZATIONAL STRUCTURE,

DEPARTMENT PROFILE AND ACTIVITIES

42
 3.1 ORGANIZATION STRUCTURE

CHAIRMAN

UNIT MANAGER

TDM MDM
(Territory Development (Marketing Development
Manager) Manager)

ADC CE
(Account (Customer
Development Executive)
Coordinator)

MDC MDE
(Marketing (Marketing
Development Development
Coordinator) Executive)

SALESMAN ROUTE AGENT

43
3.2 BRIEF DESCRIPTION ON EACH FUCNTION AREA/ DEPARTMENT

Start Check in Meet the C.E. Pre plan strategy

Drive to Checking of load Order the Collect Route

gate by C&F worker Load Book/ Forms

Collect gate pass

Rechecking and attend the gate
of load meeting. Ask for Check out Visit First outlet
the daily scheme

Ask for the Check empties Present the

order scheme Greet retailer
Deliver the Merchandise
order the outlet Fill Visi cooler Create stack

Fill the route Prepare the Collect money Ask for any
book cash memo problem

Plans next Thanks, Complete the Back to

visit the route
customer

Fill the complaint

register and place the Count the empties
End order. Deposit the cash Check in and match it with
to cashier gate pass load

44
PEPSI 10 STEP CALL:

 Greet the customer by name.

 Collect and sort all empties from the storeroom.

 Communicate marketing programmes and scheme to the customer.

 Leverage the route book and refill the empties.

 Arrange warm product displays (in the shop).

 Charge cooler, ensure 100% purity.

 Arrange crate display outside the outlet.

 Put up POS at eye level.

 Prepare cash memo, collect cash and fill up the route book.

 Thanks, the customer.

INTRODUCTION TO SUPPLY CHAIN MANAGEMENT:

Supply Chain Management refers to the analysis of an effort to improve a company’s process for

product and service design, purchasing, invoicing, inventory management, distribution, customer

satisfaction and other elements of the supply chain. Supply Chain Management usually refers to an

effort to redesign supply processes in order to achieve to streamlining. Supply Chain Management is a

coordinated set of techniques to plan and execute all steps in the global network used to acquire raw

materials from vendors, transform them into finished goods, and deliver both goods and services to

customers. It includes chain-wide information sharing, planning, resource synchronization and global

performance measurements. Supply chain management (SCM) is the oversight of materials, information

and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to

consumer. Supply chain management involves coordinating and integrating these flows both within and

45
among companies. It is said that the ultimate goal of any effective supply chain management system is

to reduce inventory (with the assumption that products are available when needed). As a solution for

successful supply chain management, sophisticated software systems with Web interfaces are competing

with Web-based application service providers who promise to provide part or all of the SCM service for

companies who rent their service. Supply chain management flows can be divided into three main flows:

 The product flows

 The information flows

 The finances flow

The product flow includes the movement of goods from a supplier to a customer, as well as any

customer returns or service needs. The information flow involves transmitting orders and updating the

status of delivery. The financial flow consists of credit terms, payment schedules, and consignment and

title ownership arrangements.

There are two main types of SCM software: planning applications and execution applications.

Planning applications use advanced algorithms to determine the best way to fill an order. Execution

applications track the physical status of goods, the management of materials, and financial information

involving all parties.

Some SCM applications are based on open data models that support the sharing of data both inside

and outside the enterprise (this is called the enterprise, and includes key suppliers, manufacturers, and

46
end customers of a specific company). This shared data may reside in diverse database systems, or data

warehouses at several different sites and companies.

FIVE BASIC COMPONENTS FOR SUPPLY CHAIN MANAGEMENT:

1. Plan-This is the strategic portion of supply chain management. One needs a strategy for

managing all the resources that go towards meeting customer demand for one’s product or

service. A big piece of planning is developing a set of metrics to monitor the supply chain so that

it is efficient, costs less and high quality and value to customers.

2. Source-Choose the suppliers that will deliver the goods and services one needs to create one’s

product or service. Develop a set of pricing, delivery and payment process with suppliers and

create metrics for monitoring and improving the relationships. And put together process for

managing the inventory of goods and services one receives from suppliers, including receiving

shipments, verifying them, transferring them to your manufacturing facilities and authorizing

supplier payments.

3. Make-This is the manufacturing step. Schedule the activities necessary for production, testing,

packaging and preparation for delivery. As the most metric-intensive portion of the supply chain,

measure quality levels, production output and worker productivity.

47
 4. Deliver-This is the part that many insiders refer to as “logistics”. Coordinate the receipt of orders

from customers, develop a network of warehouses, pick carriers to get products to customers and

set up an invoicing system to receive payments.

5. Return-The problem part of the supply chain. Create a network for receiving defective and

excess products back from customers and supporting customers who problems with delivered

products.

INTRODUCTION TO SUPPLY CHAIN OF PEPSI CO.:

Pepsi is a well-established brand and has to take care of heavy demand for their product in the market.

Since there is heavy demand for their product in the market, they have to take care of their distribution

channel very seriously. They have maintained a very good balance between the responsiveness and the

efficiency of the distribution channel.

Supply chain of Pepsi is very simple; there are two type of supply route from where the goods are

transported. The 1st care is when the bottle comes from Greater Ernakulam bottling plant and then it is

movedto the distributor and from there it moves to the retailer.

Retailer counter that means supply chain has 4 stages:

1. Manufacturer

2. Distributor

3. Retailer

4. Customer

48
EXISTING SUPPLY CHAIN OF PEPSI CO:

Pepsi passes through 3 stages to reach the final customer. The product comes from the plant situated

at Greater Ernakulam from there with the help of company’s transporters it reaches to the distributor

warehouse. The distributor for Noda area is situated in sec-66 of Ernakulam under the name of Varun

Beverages ltd. Generally, the distributor places order to the company and get the requested order within

two days, but there are some norms which are led by the company, which are as follows:

1. The payment should be paid in advance.

2. 15% of transportation cost is managed by distributor as well as transit insurance is managed by

the distributor.

So, well the goods are manufactured and kept as inventory in the warehouse of the company at

Greater Ernakulam from there it is allocated on trucks and reach to the distributor’s warehouse within 2

days, but the order is displaced in the consent with the requirement of distributor. There is a limit on

minimum number of crates which has to be ordered by the distributor i.e., 500 crates and then with the

help of work force the distributor has to move these goods to the retail counter. It is the responsibility of

the distributor to see that there is a ready availability of the product in the market through its work force

‘sales persons’, which is to be occasionally checked by the company people. There are four distributors

in the Ernakulam region which are situated in different locations to every corner of the city.

Modus operand of the distributor to make the availability of the product in the market is quite tough.

The sales person under the distributor has to visit each and every retailer in their area daily so that there

should be no shortage of the product in the market.

The distributor has to supply its goods from its depot to various retailers in the market with the help of

its work force. The distributor performs this task with the help of local transportation which is either

owned or hired by the distributor for this purpose. The distributor has to look upon several other things

49
which are important in day-to-day functions. Its job starts from when the goods reach the depot, firstly it

has to check that the number of crates is in order which are being unloaded from the trucks, sorting of

the goods received and removing the damaged goods. After the goods are been unloaded, they are

storedin an appropriate order in the depot. Goods one stored are then distributed with the help of

several salespeople. Every sales person is given a particular route in which he has to supply the

goods. The salespersons are provided with trucks or other smaller vehicles like tempos to carry the

goods from the depotto the market. The goods are loaded into every vehicle depending on the type of

sales man’s route; thegoods when loaded are counted on the depot gate and a gate pass is given to the

sales person mentioningthe amount of goods carried out on that particular day. The sales person along

with a helper then goesout in the market to deliver the goods to the retailers. The main job of the

sales man is to deliver thegoods to the retailers, arrange the products in the retailers VISI cooler,

informing the retailer about theschemes available & about the new products, give the receipt of the

product to the retailer and takepayment in cash with the counter part of the receipt duly signed by the

retailer. The sales man has also to bring back the empties back to the depot and the damaged products as

and when returned by the retailer. After the empty bottles are brought back to the depot, the empties

are then sorted out and then sent back to the bottling plant. The distributor has also to manage the

proper stock keeping of the empties;the simple rule that is followed by the distributor in this case is,

for every bottle of soft drink sold on aparticular day the sales person should bring the exact number of

empties back to the depot.

Once the goods have reached to the retailer store the last stage of the supply chain starts, where goods

are transferred from retailer to the ultimate customer. It is the consumer who finally consumes the

product and therefore the retailer has to know the taste and preference of the customer. A retailer needs

to provide a customer ample number of product choices to choose from. Therefore, a retailer likes to

keep large variety of products so that he can cater to the demand of large number of customers.

Therefore

50
a distributor has to make sure that retailer is provided with sufficient amount of its products. In case of

distribution channel of Pepsi, the distributor has to maintain ready and continuous supply of goods to the

retail outlets because in FMCG sector the consumer quickly moves to its substitutes goods due to non-

availability of the product. The demand for goods is this market is very volatile and keeps on changing

according to consumer changing taste and preference. So, in order to avoid losing market the distributor

has to keep an eye on the market conditions and to maintain a perfect balance on the demand and supply

position in the market. The distributor also has to carry out occasional market surveys to find out their

market position and to look out for further potential markets.

51
PICTORIAL REPRESENTATION OF SUPPLY CHAIN:

PRODUCED

PRODUCT

BOTTLING PLANT

DISTRIBUTOR

RETAILER

END CONSUMER

52
FLOWS IN PEPSI CO SUPPLY CHAIN:

1. PHYSICAL FLOW:

Suppliers Transporters, Manufacturer Transporters, Dealers Transporter,

Warehouses Warehouses Warehouses

Retailers

2. TITLE FLOW:

Suppliers Manufacturers Dealers Retailers

3. PAYMENT FLOW:

Suppliers Banks Manufacturers Banks Dealers Retailers

4. INFORMATION FLOW:

Suppliers Transporters, Manufacturer Transporters, Dealers Retailer

Warehouses, Warehouses,
Banks Banks

Customers
5. PROMOTION FLOW:

Suppliers Advertising Manufacturer Advertising Dealers Advertisement

Agency Agency Agency

Retail

53
3.3 ACTIVITIES DONE

54
 CHAPTER 4

TASK AND LEARNING RESPONSIBILITIES

55
 4.1 SWOT ANALYSIS

STRENGTH

 A MULTI NATIONAL COMPANY

 GOOD BRAND RECOGNITION

 STRONG MARKETING STRATEGY

 STRONG ADVERTISING CAMPAIGN

 GOOD REACH TO MARKET

 ABILITY TO PROVIDE GOOD SALES PROMOTION SCHEMES

WEAKNESS

 NON-AVAILABILITY OF ALL PRODUCTS

 POOR AFTER SALES SERVICE

 INEFFICIENT ROUTE SALES AGENT

 POOR DISTRIBUTION OF SCHEMES

 PROMISES ARE NOT FULFILLED

 LACK OF REFRIGERATING ASSETS DURING SUMMER SEASON

OPPORTUNITIES

 SCOPE FOR GROWTH IN THE MARKET

 PEPSI SHARE IN TOTAL VOLUME OF MARKET IS 57% THERE IS STILL A LARGE

MARKET FOR IT TO CAPTURE

 THERE IS A HUGE RURAL MARKET TO BE EXPLORED BY PEPSI

56
THREATS

 COCA COLA COMING INTO THE MARKET WITH AGGRESSIVE MARKETING

STRATEGY.

 PEPSI LOOSING OUT TO COCA COLA ESPECIALLY IN THE URBAN MARKET.

 AVAILABILITY OF SWADESHI SUBSTITUTES IN THE MARKET.

 PEOPLE CHANGING ON TO FRUIT DRINKS BECAUSE OF FEAR OF PESTICIDES IN

CARBONATED SOFT DRINKS.

57
4.2 FINDINGS:

DEFICIENCIES IN SUPPLY CHAIN OF PEPSI:

1. PROBLEM FACED BY THE DISTRIBUTOR:

 There is a great chance of damage in the product because of two reasons (a) the goods are

transferred from a long distance. (b) the plastic bottles are more prone to damages during the

summer season because of the heat conditions.

 Damaged materials are not easily returned by the company people and it takes almost three

months to get the damaged goods returned with the settlement of bill. Therefore, a large amount

of capital gets blocked and it creates disturbance in the distribution channel.

 Less motivated work force of distribution channel, the sales person is not motivated enough to

bring maximum sales during the day.

 Most of the retailers were found keeping other products in the company owned coolers like Ice

creams, milk, chocolates etc. this results in less storage in coolers and non-availability of

sufficiently chilled soft drinks for the consumers.

 The retailers are not conscious enough to get the service & repairment of their cooling

equipment done regularly, which resulted in frequent complains of cooling equipment getting out

of order.

2. PROBLEM FACED BY THE RETAILERS:

 Negligence made by the distributor: if the workforce of the distributor makes any kind of

mistake in order taking and fulfillment of the order, the consequences are faced by the retailer.

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 The sales person of the distributor is not honest while distributing schemes to the retailers,

therefore often the retailer gets part of the scheme or remains unaware of the schemes.

 The sales people are less efficient in supplying goods to the retailers and are also negligent in

keeping the cooling equipment especially the VISI coolers pure. Therefore, the cooling

equipment are often found to be stocked with rival brands which lower the sale of company

products.

 The company is less efficient in replacing the old and damaged coolers with new ones, which

causes problem for the retailers.

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 4.3 CONCLUSION

During my stay in the organization as Summer Trainee I discovered a few discrepancies in the market,

which have been mentioned earlier. Some of the conclusions drawn from my study during my stay are

mentioned as follows:

 Lack of proper schemes has been a major reason behind the unfavorable response at some of the

outlets. On the other hand, Coca Cola had been quite active in this regard and gave attractive

schemes in this season. Although the schemes provided by Pepsi were found better than that

Coca Cola but the major reason for Pepsi lacking behind was inefficient distribution of the

schemes to the retail outlets.

 It has been found that quite often than not the schemes provided by the distributor do not reach

the intended customers. Most often the outlet owners do not give these schemes (gifts) to the

customers. This calls for strict vigilance by the higher authority to make sure that the schemes

reach to the customer.

 The route agent seems to be indifferent to his route sales and also towards the retailer problems.

Most of them were in the habit of taking leaves frequently which resulted in loss of route sales

and were not motivated enough to increase his route sales and seems to be harried a lot.

 Most of the vehicles were not in proper working condition and also most of the sales people are

not provided with basic utility tools for unloading and supply of stock.

 It has been seen that most of the shop keepers were not satisfied with the service provided by

Pepsi sales man also there was large amount of dissatisfaction among the shop keepers regarding

the cooling equipment provided by the company. Coca Cola was found to be functioning well

especially in the urban markets with their aggressive sales promotion schemes and most

shopkeepers were satisfied with their products.

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 4.4 RECOMMENDATION:

Following are some of the recommendations put forwarded which may be of use for the organization:

 The supply chain should be checked regularly by the higher employees so that the deficiencies

can be known and proper actions should be taken to remove the same.

 Care should be taken by the distributor that the schemes provided for the retailers are available to

them without any distortion and that the problems faced by them are sorted out quickly by the

sales executive.

 The distributor should try to solve the problems faced by the retailers with respect to the chilling

equipment provided by the company, especially during the peak summer season which causes a

huge problem for the retailers to keeps the soft drinks chilled.

 The distributor should keep a routine check on the distribution of sales generating assets to the

retailers and look for proper display of its products in the shops.

 Attractive incentive schemes for the route agents to increase the route sales should be taken into

consideration. This will help reduce absenteeism among the route agents and will also help

increasing sales of the depot.

 It has been seen that most of the gifts which come out of lucky draw or schemes doesn’t reach

the customers in time. Care should be taken that these gifts reach in proper condition and in time

to the customers who will help create goodwill of the company.

 Rural area and villages should be targeted properly and it should be seen that all the products and

schemes that are provided by the depot are reaching to the ultimate consumers.

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 There has always been a complaint from the retailers that all the flavors and the products does

not reach them as and when wanted by them, in this regard the sales person should be efficient in

catering to the market needs and help satisfying the demand of the retailers.

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 4.5 BIBLIOGRAPHY/REFERENCE

BOOKS REFERED:

1. Marketing Research- An Applied Orientation,

By Naresh K. Malhotra.

2. Consumer Behavior-
By Leon G. Schiffman & Leslie Lazar Kanuk

3. Marketing Management-
By Philip Kotler.

WEBSITES:

www.pepsiworld.com

www.pepsico.com

www.rkjgroup.com

www.pepsiindia.co.in

www.wikipedia.com

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