history of pepsi new
TRANSCRIPT
CHAPTER-1
INTRODUCTION TO THE STUDY
Beverage industry is one of the fast growing industries in India. It can be divided into two
sections i.e. carbonated and non-carbonated. The carbonated drinks can be further classified
into cola, lemon, orange, mango and apple segments. Marketing includes all the activities like
promotion, distribution, advertising etc. Marketing is also to convert social needs into
profitable opportunities. So this topic provides all the essentials to theoretical as well as
practical knowledge and inculcates efficiencies. It will help the company ultimately to achieve
their goals. The soft drinks companies are experiencing a boom in soft drinks, although growth
of other cold drinks is not quite encouraging. The markets of soft drinks are mainly triggered
by the entry of two players i.e. Coca Cola and Pepsi.
PepsiCo India is striding ahead rapidly towards enabling the global vision to be the world's
premier consumer products company focused on convenience foods and beverages. PepsiCo
India seeks to produce healthy financial rewards for investors as it provide opportunities of
growth and enrichment to its employees, business partners and the community’s in which it
operates. PEPSI has gained its dominance in terms of beverages as well as food. In partial
fulfillment of the above mentioned course a project was undertaken by me on the topic” A
COMPARATIVE STUDY ABOUT THE SALES AND DISTRIBUTION SYSTEM OF
PEPSI AND COCA-COLA IN PATNA”. To know the facts regarding the above topic, a
market survey particularly for customers, retailers and distribution in Patna by me. My interest
was to look into customers perception and satisfaction level about PepsiCo with other
beverages present in the market.
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The company wants to give maximum satisfaction to its customers, so that they can get
good value for their capital. The company wants to know whether the consumers are satisfied
with their services or not? Whether consumers have faced any problem with the product and if
any then what type of problem they are facing?Whether the retailers are satisfied with the
promotional schemes of the company? What should be the changes that will improve the
quality of services? What are the competitive advantages the company has over the
competitors and where the company lacks? What are the opportunity and threats in the external
environment and how the company schemes for the opportunity and how the company
overcomes these threats?
Since this study was aimed at knowing the customer as well as retailer’s satisfaction,
dissatisfaction level ,therefore it required to collect information related to quality of services
provided by PepsiCo Company as well as about its competitors.
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IMPORTANCE OF THE STUDY
The project report titled “A COMPARATIVE STUDY ABOUT THE SALES AND
DISTRIBUTION SYSTEM OF PEPSI AND COCA-COLA IN PATNA” can be
of great importance to the organization.
It will help the company in following major way:-
To ascertain the satisfaction level of consumers
To identify their competitors and about their strength and weaknesses
To design their market strategies
In other way it can also influence the decision on the requirement of the sales and
distribution & comparison between Pepsi and Coca Cola. Though I have tried to do my
project study honestly and sincerely and in case, if there are any weaknesses and
shortcomings, those are unintentional.
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OBJECTIVE OF THE STUDY
Every project is carried out with a view to attain certain predetermined objectives. Following
are the objectives of this project:-
To know the brand perception of PEPSICO BEVERAGES.
To know the choice of brands of the consumers and reason for the same
To know the Stock Keeping Unit (SKU) of Pepsi and its competitors at different
outlets.
To ascertain the satisfaction level of consumers
To identify the products image.
To find the distribution channel adopted by Lumbini Beverages Pvt. Ltd.
Hajipur.
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IMPORTANCE AND RELEVANCE OF
THE STUDY
Cold drinks were started with the idea of quenching the thirst of the persons travelling. It was
also felt that reliable good water was not available everywhere. So people would prefer packed
bottle and with this idea its makers made these drinks available mostly at those places where
water was not available i.e. on highways and long distance trains. But slowly and slowly with
its good taste these become very popular and now they are available not only in the market and
street corners, but also people have started keeping it in their house. The credit of popularizing
the soft drink goes to Coca Cola. This was the drink which is liked by all ladies, gents and
children. Now days soft drinks are not only the quenching thirst but these are also taken due to
habits. Gold Sport is considered as the first branded soft drinks, established 53 years ago before
all empowering Coca Cola faced competitions and its euphoric image built up in the western
countries helped it get ready client and glamour. Parle Export Pvt. Ltd. is regarded as the first
Indian Company introducing Limca a lemon drink complementary to it .Cola Peptones was
also introduced which was withdrawn because of the tough competition from Coca Cola. When
Coca Cola bid a Farwell in 1977, Indian market was open for various new and different brands
in the markets. Parle People introduced their Cola, Thumps Up with a mighty saying “Happy
days are here again” as if happy days went away with Coca Cola. Modern Bakeries entered the
market with Double Cola Seven, Mohan Makings with Merry & Plkup and McDowell with
Thrill, Rush and Sprint. This was Indian market where there was not much competition but
huge advertising was done by every company for selling their product. Each one was trying
their best to become number one company with ‘A’ class product in the field of Soft Drink
Business. Now after a long gap, government of India had given permission to Coca Cola,
which joined with Parle to do business in India. They were trying their best to regain prestige
which it had before. The much rival of Parle was Pepsi an American concern. It started
business on the Indian soil just a few years ago.
LIMITATIONS OF RESEARCH
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Some of the limitations of this project are as follows:
1) It was not possible to understand thoroughly about the different marketing aspects
of soft drinks in a span of two months.
2) The survey was conducted in the peak season when the sale was too high. By this I
cannot get the appropriate result.
3) No stipend was given, so it was difficult to cover a wide area.
4) All the work was limited to Patna area only, so the finding could not be
generalized .The finding of survey was strictly based on the response of consumers,
retailer/dealers so it is difficult to ascertain the authenticity of their statement.
5) Shortage of time factor was one of the biggest constraints.
6) Most stress was given on the secondary primary data as it was difficult to collect
primary data from the organization.
PEPSICO MISSION AND VISION
MISSION:
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The mission of Pepsi co is to be the world's premier consumer Products Company focused on
convenient foods and beverages. It seeks to produce financial rewards to its investors as it
provides opportunities for growth and enrichment to their employees, business partners as well
as to the communities in which it operates and it also strives for honesty, fairness and integrity.
in everything that it does.
VISION:
PepsiCo's responsibility is to continuously improve all aspects of the world in which it
operates - environment, social, economic - creating a better tomorrow than today. “Their 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.
FUTURE PLANS
Every company has some future plans. So Pepsi Company also has its future plans to increase
its sales and the market share in the soft drinks industry. In order to capture Indian food market
PepsiCo India has planned to launch indigenous food products. PepsiCo is going to make an
investment of around $110 million in its beverages business in India to increase the production
capacity and the quality of the products. On future plans, the company is also planning to
launch Lipton ice tea all over the country during summer season.
The company is also seriously considering bringing some products from Quaker Oats into the
country. PepsiCo’s beverage business has also decided to invest $220 million in the current
year. Clearly, the snacks business — which has grown five-fold in the past four years — is
lifting PepsiCo’s fortunes. The CEO of Pepsi India, Ms. Nooyi says the company is now
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looking at tripling this business in the next three years or so, and is even testing Lehar Kurkure
for the US and UK markets. It is learnt that the total investment for the beverage business of
PepsiCo India for the next three year will be around $350 million. PepsiCo India has also
announced Rs 1,000-crore investment for this calendar year that will see the food and beverage
major expanding its manufacturing capacity and supply chain, among others, in the country. In
this way Pepsi India Company is taking steps to increase their sales and their market share in
the soft drinks industry.
CHAPTER-2
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HISTORY OF PEPSI
Pepsi-Cola Company was founded by CALEB D. BRADHAM in 1890 at North Carolina in
USA. It’s CEO is ROGER ENRICO and in India PepsiCo chairman is Mr. RAJIV
BAKSHI. The head quarter of PepsiCo in India is at Gurgaon. Presently it is operated in 196
countries. Pharmacist CALEB invented it to cure the disease “DISPARSIA”. It is from this
word that was Pepsi is related to. Soon it entered the American market as soft drink which at
that time was mostly dominated by Coca-Cola, but soon Pepsi was able to dominate the cola
market & thereafter there has been no looking back. Pepsi & Coca-Cola was engaged in
ferocious cold war that has taken the whole world by storm. Pepsi stands 51st position among
the fortunate 500 companies of the World. Its total capital is approx $3000 crore, total sales
annually is worth $37 crore, half of which comes from beverages and other half from division.
The beverages arm of the PepsiCo is Pepsi-Cola Company and the snack food country is
called Frinto-Lay-Inc. The year 1998 was centennial year for Pepsi. Its total profit in the year
1996-1997 was worth Rs. 45 crore approx. The total number of employees engaged in this
business is 4.25 lakhs globally.
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HISTORY OF PEPSI IN INDIA
Soft drink PepsiCo gained entry to India in 1988 by creating a joint venture with the Punjab
government-owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited. This
joint venture marketed and sold Lehar Pepsi until 1991, when the use of foreign brands was
allowed; PepsiCo bought out its partners and ended the joint venture in 1994. Others claim that
firstly Pepsi was banned from import in India, in 1970, for having refused to release the list of
its ingredients and in 1993, the ban was lifted, with Pepsi arriving on the market shortly
afterwards. These controversies are a reminder of "India's sometimes acrimonious relationship
with huge multinational companies." Indeed, some argue that PepsiCo and The Coca-Cola
Company have "been major targets in part because they are well-known foreign companies that
draw plenty of attention."Soon it was giving the local contenders the run for their money in the
soft drink market. It comes out with dazzling marketing innovation that rocket the cola market
line selling the product through function, Pepsi outlets. Pepsi’s success in creating a brand
almost from scratch in India is the stuff that marketing case studies are made off. Given the
problems of doing business in markets like ours, Pepsi entered the market as an under-dog. Its
first even advantage- it entered before Coke returned was considerable reduced by the
enormous export obligations stepped on the company. Yet right from the beginning, Pepsi
demonstrated a far more focused approach. So while it entered the market like any other MNC,
it was quick to adapt, it realized that consumers, particularly the youth, to whom it consciously
reached out, would identify better with a brand that they see as globe, yet Indian, Pepsi was
built as a desi brand. Hence its deliberate attempt to build advertises campaigns using the
Popular Hinglish in the process. Slogans like, ‘YEHI HAI RIGHT CHOICE BABY’,
“YEH DIL MAANGE MORE –AHA” and “YEH PYASS HAI
BADI” became part of India’s popular consciousness. When Pepsi lost the bidding battle to
sponsor a cricket tournament to Coke, the loss was turned into triumph with the catch line,
“NOTHING OFFICIAL ABOUT IT”. It cashed in on the untapped consumer aspiration in
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smaller towns, the hinterlands of metropolitan cities and now days the slogan which is on air is
“YE HAI YOUNGISTAAN MERI JAAN”. It showed a rare ability not only to survive, but
also grow through India’s tortuous policy twists and turns, which threw many other MNC’s off
balance. Its top management team did not suffer from the frequent changes seen at rival. Coke
consequently paid enormous prices to buy out established local brands, Pepsi brought its own
stuff over and pushed those aggressively with dealers, retailers and consumers. Right now, it
can bark outstanding success in building a brand that has become synonymous with soft drinks
across the length and breadth of the country. Pepsi-Cola Company was founded by CALEB D
BRADHAM in 1890 at North Carolina in USA. It’s CEO is Indira Nooyi and in India
PepsiCo chairman is Mr. Rajiv Bakshi. The head office of PepsiCo in India is at Gurgaon.
Presently it operates in 196 countries. Pharmacist CALEB invented it to cure the disease
“DISPARSIA”. It is from this word that was Pepsi is related to. Soon it entered the American
market as soft drink which at that time was mostly dominated by Coca-Cola, but soon Pepsi
was able to dominate the Cola market and thereafter there has been no looking back. Pepsi and
Coca-Cola are engaged in a ferocious cold war that has taken the whole world by storm.Pepsi
stands 51st position among the fortunate 500 companies of the world. Its total capital is approx
$3000crore and total sales annually are worth $37crore, half of which comes from beverages
and other half from food division. The beverages arm of the PepsiCo is Pepsi-Cola company
and the snack food company is called Frinto-lay-Inc.
CHARACTERSISTICS OF SOFT DRINKS
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Unfinished goods (Required chilling before consumption)
Two -way transportation (Once filled bottles to market and then empty bottles from
market).
Heavy expenses on advertisement and promotions.
More attention to retailers is given. Several schemes and other facilities provided to
them.
New flavours are introduced from time to time.
Highly competitive market with only two equally strong Players
CHAPTER-3
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HISTORY OF LUMBINI BEVERAGES
PVT.LTD
With the urbanization of economy in 1991, about 13 year after the exit of Coca Cola from
Indian market, an MNC globally known as PCI (Pepsi Cola International) entered the Indian
market with its name PFL (Pepsi Foods Ltd.).It started bottling its products in Bihar by Steel
City Beverages, Jamshedpur on 24th March 1991. Late D. N. Kamani installed this bottling
unit in 1969. The company entered the soft drink market with the introduction of Coca Cola
and entered in the market of Bihar, parts of Bengal, Orissa and Nepal. The company was the
pioneer of soft drink in Bihar. Due to urbanization and behavioral changes the number of soft
drink consumers increased. The Steel City Beverages Ltd. Jamshedpur, was unable to meet the
demand of supply as per the seasonally graph in North Bihar due to increases in the number of
consumers. To fulfill the demand in that region, PFL established a plant in Hajipur, under the
auspicious guidance of Mr. Charan Khilani in December, 1997 famous as Lumbini
Beverages Pvt. Ltd.
It is one of those bottling units of PFL which comes under FOBO (Franchise Owned Bottling
Operation).Mr. Ravi Khilani is MD of this company. The plant has 57 production staff, 30
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executives and 32 team members within marketing and selling functions .During the peak
session i.e. between April-July, the no. of production staff at times is increased to take care of
increased production functions.
The unit has capacity of bottling 400-600 bottles per minute or 3000 carates of 24 bottles on a
daily basis, i.e. when production schedule is throughout the day with three shift production
system. The plant follows international quality audit standard for the purpose of maintaining
quality controls in the quality of the product because the quality control function, by far is the
most important criteria for purpose of competing in terms of quality in the contest of the
market competition.
This bottling unit at Hajipur has created a source of employment for a large no. of population
residing in the Bihar and has also come out with quality/treated water resources, which is now
being thought of diverting into nearby agriculture sector as an ongoing source to facilitate of
management. PLACE- Lumbini Beverage Pvt. Ltd. is situated at Industrial Area, Hajipur
in Vaishali district of Bihar. Mr. Charan Khilani, who is a resident of Kolkata, established
it in the year 1997.
ORGANIZATIONAL STRUCTURE OF
LUMBINI BEVERAGESPVT.LTD
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An ideal organizational structure facilities management and the operation of the enterprise and
it help the organization in achieving its goal. In a simple term in various parts or component are
interrelated or interconnected and this way it is the established pattern or relationship among
various function of the organization in the established manner. …The managing director holds
the top position. At present, the managing director (MD) of Lumbini Beverages Pvt. Ltd. is
Mr. Charan Khilani. But the overall policies regarding management decisions and all
executive functions or performance look, and general administration as well as management
are looked by Mr. Ravi Khilani. The MD has given the power of attorney and authority to
director Mr. Ravi Khilani. He is well advised by the MD. The director Mr. Ravi Khilani
looks after all functional departments like sales production, account, personnel and purchase.
The overall organizational structure can be shown as:
PROFILE OF LUMBINI BEVERAGES
Company Land Area : 9.30 Acres
Location & Authority : EPIP, Industrial Area, Hajipur
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Name of Director/occupier : Mr. Ravi Khilani
Name of the MD : Mr. Charan Khilani
Name of the CEO : Mr. G. P. Singh
Name of the HOS : Mr. Madan Nagar
Name of T.D.M : Mr. GyaneshAwasthi
Name of H.R.M : Mr. N. K Prasad
Industrial License No. : Registration No. – H 12475 (C)
Factory License No. : 66750/VLI
F. P. O. No. : 10607/97
Capacity : 850 bottles per minute
Nature of product : Soft Drinks
Control Board : No. 1877
ORGANIZATIONAL HIERARCHY
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SWOT ANALYSIS OF THE ORGANISATION
STRENGTHS: -
Lumbini Beverages Pvt. Ltd (LBPL) is Franchise Owned Operation (FOBO) of
world’s most famous soft drink PepsiCo.
LBPL uses state of the art and fully automatic machines and technology for the
production of soft drinks.
It has very strong network and built market and currently holds all the parts of the
state.
It has wide range of product varieties.
WEAKNESS: -
No cost cutting program for the products.
A promotional activity in the rural market is not upto the mark as compared to the
urban market.
Brand Pepsi in cola flavor is one of the popular lagging
behind with its nearest Competitor, only due to high sugar
content and less thrilling taste.
No availability of the entire product on demand.
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OPPORTUNITIES: -
LBPL makes the buying process more convenient (it provides the Pepsi products at
required places i.e. direct to distributors & retailers through distributors)
It takes return the leakage, burst bottles etc.
THREATS:-
Coca-Cola is now spending more and more to boost up the sale.
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PEPSI
UNIT MANAGER FINANCE
UNIT MANAGERHRD
UNIT MANAGER F.O.B.O.
MANAGING DIRECTOR
CEO
FINANCE
H.O.F.
A/C AND FINANCE
MANAGER
A/C ASSISTANT
PRODUCTION
PLANT MANAGER
SHIFT ENGINEER CHEMIST
SALES
H.O.S.
T.D.M.
A.S.M
C.E.
ROUTE ADVISER MERCHANDISER SALES MAN
H.R.D.
HR EXECUTIVE
PERSONAL EXECUTIVE
UNIT MANAGER MARKETING
THE PRODUCT PROFILE OF
LUMBINI BEVERAGE PVT.LTD
PepsiCo makes products like Doritos, Lay's, Cheetos, Fritos, Ruffle potato chips, Tostitos,
Quaker Chewy granola bars, Sun Chips, Rold Gold pretzels, Stacy's pita chips, Smart food
popcorn, Pepsi, Mountain Dew, Gatorade, Tropicana Pure premium, Sierra Mist, Propel,
Tropicana juice drinks, Dole, SOBE Life Water, Aquafina, Capon Crunch, Life cereal,
Starbucks ready to drink coffee, Lipton ready to drink tea, Quaker oatmeal, Aunt Jemina
pancake syrup. But the major brand categories owned by PepsiCo, Inc. include Pepsi, Frito-
Lay, Gatorade, Quaker Oats and Tropicana. Each of these products has numerous other product
offerings in their respective categories, both at U.S. and in international market. For example,
the Pepsi-cola family includes over two dozen beverage brands, such as Mountain Dew, Mug
(root beer) and several partnerships (e.g., Lipton ice tea). Quaker Oats includes Rice-a-Roni
side dishes, Aunt Jemima mixes and syrups, etc.
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THE PRODUCT PROFILE OF LUMBINI
BEVERAGE PVT.LTD
Product Name Quantity
PEPSI : 200ml, 300ml, 600ml, and 2000ml
MIRINDA : 200ml, 300ml, 600ml, and 2000ml
SLICE : 200ml, 250ml, 500ml, and 1200ml
MOUNTAIN DEW : 200ml, 600ml, and 2000ml
7UP : 200ml, 300ml, 600ml, and 2000ml
NIMBOOZ : 350ml
AQUAFINA : 1000ml
SODA : 350ml, 500ml, and 1000ml
TROPICANA JUICE : 250ml, 200ml, and 1000ml
MY CAN : 250ml
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CHAPTER-4
MARKET SEGMENTATION
The soft drink being a FMCG product has a wider and scattered market. Thus to enable
concentrated effort of marketing activities in different scattered market, the entire market is
broken down into the following segments.
Route Market
Home Market
At Work Market
ROUTE MARKET:-
Outlets in this market cater to those people who are engaged in shopping, eating, outgoing for enjoyment in amusement centers etc.
HOME MARKET:-
Outlets in this market cater to people buying prominently for home consumption either by carats or loose bottles.
AT WORK MARKET:-
Outlets in this market cater to people working in office, factories etc., An attempt is always made to make soft drinks readily and conveniently available all day long while people are actively working.
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WHY COCA-COLA IS DOMINATING?
The Coca-Cola Company has historically been considered PepsiCo’s primary competitor in the
beverage market, and in December 2005, PepsiCo surpassed The Coca-Cola Company in
market value for the first time in 112 years since both companies began to compete. In 2009,
the Coca-Cola Company held a higher market share in carbonated soft drink sales within the
U.S. In the same year, PepsiCo maintained a higher share of the U.S. refreshment beverage
market, however, reflecting the differences in product lines between the two companies. As a
result of mergers, acquisitions and partnerships pursued by PepsiCo in the 1990s and 2000s, its
business has shifted to include a broader product base, including foods, snacks and beverages.
The majority of PepsiCo's revenues no longer comes from the production and sale of
carbonated soft drinks. Beverages accounted for less than 50 per cent of its total revenue in
2009. In the same year, slightly more than 60 per cent of PepsiCo's beverage sales came from
its primary non-carbonated brands, namely Gatorade and Tropicana.
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Two primary reasons contributed to domination of Coca Cola in the international market, the
first one was the strategy that Coca-Cola used when investing in a foreign market. Coca-Cola
entered foreign markets differently than Pepsi, providing it an edge over Pepsi. While Pepsi
invested heavily in foreign markets, Coca-Cola’s appointed bottlers with significant experience
easily neutralized any threat PepsiCo could pose. The second reason was that the Coca-Cola
holds such a dominant position in world market during World War II. During World War II,
Coca-Cola offered American servicemen its product for 5 Cents, wherever they were and
whatever the costs the company would incur. The company would establish bottling plants
(subsidized by US government), and send its product overseas wherever US troops went. With
its inexpensive price, and widespread popularity among servicemen, coupled with the eventual
victory of US in Europe and Asia, the product was widely adopted throughout Europe and
Asia. Due to familiarity of the product, Coca-Cola still retains a dominant position throughout
Europe and Asia.
COMPETITOR COCA-COLA
Quick and prompt to their service.
This company is more dominant and securing a positive image in the market.
Regular to their service.
More chillers are made available in comparison to Pepsi.
Scheme is properly conveyed to shopkeepers.
Close watch on current market trends.
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PROMOTIONAL ACTIVITIESPromotional activities play a greater and important role in the marketing and selling of a product.
PROMOTIONAL ACTIVITIES CARRIED OUT BY "LUMBINI BEVERAGES PVT. LTD"
Lumbini Beverages Pvt. Ltd (LBPL) carries out its promotional activities as a controlled and integrated program of communication and material design to present its soft drink to the
prospective customer.
The Tools used by “Lumbini Beverage Pvt. Ltd.” for fulfilling various purposes of its
(i) Point of purchase :
Every item of sale in a shop is displayed in front where people can see it at the first sight. It is the same with all the shops vendors in town who is either selling Consumer goods or selling soft drinks. Rather in selling a product like PEPSI display is more helpful as it is an essential element because soft drink has brought an impulse on the spur of the movement. Thus the product is tested when it is brought at people's attention.
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(ii) Special event market:-
The dealer at special event, places the banners and stall of Pepsi's products. The special event market includes picnic spot, cricket match, social activities etc It helps in promoting the sale as well as in creating an image of products.
(iii) Media planning :-
A very important part of advertising is to decide the medium of advertising and how much to spend in each media:
Newspaper
Radio
Television
Hoarding
Product of sales materials include paintings, glow signs D. Board. Advertising is one of the
important factors, when all put together, results in sales of a product. It has to be backed
by the distribution network, effective servicing, dealers, goodwill and so on. Thus advertising
has to be very carefully woven with the entire demands of marketing.
PROMOTIONAL ACTIVITIES CARRIED IN PATNA
Point of purchase (POP)
Special events (fair show, Road show etc.)
Hoarding
By newspaper, TV, radio etc.
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MERCHANDISING POLICYIn today’s fast moving industry and highly competitive market, only those products are likely to be
purchased which are capable of hitting the impulse of the consumers. The products appeal should be
able to penetrate and get embedded into the perpetual space of the consumer’s mind. The concerned
product should induce to the consumers. Pepsi believes that “Jo Dikhta Hai Wahi Bikta Hai” i.e. any
product which is visible is bound to be sold.
METHODS OF MERCHANDISING:-
Visi-cooler placement
Glow sign board
Paintings
Carat stacking
Umbrella
Display
Special Schemes
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ADVERTISING STRATEGY OF THE COMPANY
The main motive behind the purpose of advertising of the PepsiCo is to maintain the
brand loyalty through recalling the memory of the users of soft drinks as to attract the potential
consumers who consume a soft drink. On the national basis the media extensively used are:
Newspaper, short advertising films, Radio, T.V etc.
Besides the advertising being carried out by PepsiCo. Lumbini Beverages Pvt. Ltd.,
Hajipur also carries out its own promotional programme of which advertisement is an
important aspect. The Lumbini Beverages Pvt. Ltd. is free to use any media, messages, copy
etc. as and when required by them but single factor which remains the same as used for each
PepsiCo's bottling company on national level is the main slogan being used by PEPSICo.
bottle all over India for its Cola Products has been "The choice of new generation". The main
model in the advertising is the Best Cricketer – M.S.Dhoni, Best Actors – Amitabh Bachhan,
Shahrukh Khan, and Best Actress – Kareena Kapoor, Pretty Zinta, and Deepika Padukone.
CHAPTER-5
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DISTRIBUTION CHANNEL OF “LUMBINI BEVERAGES PVT. LTD”
To make its products available at the right places at the right time in the market, the sales
department of the company pays major attention on controlling the channels of distribution.
Single type of markets channel is maintained by the company right from its pioneering
stage. The nature of the channel is as follows:-
Company
Distributors
Dealers
Different Outlet Owners
Consumers
At first the soft drinks is supplied to the distributors directly. Retailers or owners of any outlet
cannot take the delivery from company. They have to take the products from their respective or
nearest distributor.
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There are about 50 distributors and innumerable number of retail outlets operating with the
company in its entire market areas which includes total Bihar. In all the important places of
entire territory this company has its distributors. These distributors are selected on the basis of
assurance given by them regarding the minimum sales which they have to maintain annually.
The selection is also done on the basis of the financial position and reputation of distributor in
the market. As for example in appointing a distributor the following things are looked upon
such as first the distributor was engaged in soft drink business earlier or not , second priority is
given to those people who are in cigarette selling business. Depending upon the market, each
distributor in the initial stage has to deposit some security money. The retailers are selected by
the distributor. Fixed criteria for the selection or appointment of retailers are done which is
from the side of the distributor. Any one like Panwala, Cigarettewala or any other shopkeeper
can have the stall for the sale of soft drinks and they are called retailers or outlet owners. They
have to give assurance to the concerning distributor for better sale and at the time of taking
delivery they have to deposit the security money. The distributor at first has to seek the
permission of sales department for the number of cases of soft drinks required by them. After
getting the proper authority from sales department paying the requisite amount either by cash
or by demand draft the permission is then granted.
WAREHOUSING:-
Every company has to store its finished goods until they sold. A good facility for
keeping the finished good is necessary because production and consumption cycles rarely
match.
Warehousing is not a simply storing activity but a package of services that enables the
smooth running of the industry.
The stores must be in constant touch with the use department in order to provide
uninterrupted services to the manufacture.
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The stores functions can be organized in the following manner:-
a) To receive raw material components, equipments etc.
b) To meet the demand of use department by issuing the order.
c) Accounting the transaction properly.
d) Minimizing obsolescence surplus and scarce by right identification and using
correct preservation method.
The company supply finished products frequently to different distributors as per the
demand. Every distributor keeps a minimum stock of different products of the product line so
that the uninterrupted supply does not get affected. The problem arises from the materials that
are in stock in the form of capital cost, storage loss, pilferage obsolescence, insurance,
handling, documentation etc.
INVENTORY DECISION:-
(1) Branding and Packaging:-
Out of the total market activities some are directly performed and controlled by
“Lumbini Beverages Pvt. Ltd.” itself some are followed according to the standing
instruction of “Pepsi Foods Pvt. Ltd”. As far as the process of branding and
packaging is concerned the “Lumbini Beverages Pvt. Ltd.” along with the authorized
bottle in India adopt the same pattern as “Pepsi Foods Pvt. Ltd”.
(2) Whole selling:-
Whole selling includes all the activities involved in selling goods or services to those
who buy for resale or business use. Manufactures use wholesalers because wholesalers
can perform function better and more cost effectively than the manufacture can. These
functions are not limited to selling and promoting, buying and assortment building, but
also warehousing, transporting, financial risk bearing, dissemination of marketing
information, provision of management services and consulting. Like retailers
wholesaler must decide on target market, product assortment and services promotion
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and place. The most successful wholesalers are those who adopt their services to target
and meet customer’s needs.
Retailing:-
Retailing includes all the activities involved in selling goods or services directly
to find consumer for their personal non-business use. A retailer or retail store is any
enterprise which sells volume of product that comes primarily from retailing. All
market retailers must prepare marketing plans that include decision on target market. So
the marketing channels can be viewed as a set of interdependent organization with high
potential for conflict.
TRANSPORTATION:
Transportation is life of any business management and commerce. The purchasing officer’s
job in incomplete until and unless he ensures that the material is shipped from the vendor’s
premises located in different areas to his organization. Purchasing the transportation is a key
element in his job particularly in the context of the transportation cost. In deciding to
transporting models shippers can choose from private contract and common carriers.
Transport decisions must consider the complex tradeoff between various transportation
mode and their implications for other distribution elements such as warehousing and
inventory.
DISTRIBUTION OF PEPSI:-
Here there are four systems of distribution channels:-
Channel 1. Manufacturer…………………………………………………Consumer
Channel 2. Manufacturer……………Retailer……………………………Consumer
Channel 3. Manufacturer………Wholesaler………….Retailer…………Consumer
Channel 4. Manufacture…….Wholesaler……Jobber……Retailer……..Consumer
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Channel of distribution of Lumbini Beverages Pvt. Ltd.
By Lorry or Truck
Distributor
Dealers of customer
PERFORMANCE IN PATNA
Patna has a significant role for Pepsi products and is supplied by “Lumbini Beverages
Pvt. Ltd., Hajipur”. There are more than eight hundred outlets including exclusive and
nonexclusive outlets of Pepsi in proper Patna.
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Hierarchy is also necessary to understand the capacity of Patna
Town.
HIERARCHY OF PATNA
Distributor Consumer Executive Sales Man Accountant Vehicle Loader and Unloader
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CHAPTER-6
REPORTANALYSIS
CHANNEL TOTAL OUTLET PCI COKE PCI (%) COKE (%)
GROCERY
(General stores) 24 6 18 25 75
EATRY
(Restaurant) 20 5 15 25 75
COVENIENT
(Pan shops ,cigarette shops) 44 14 30 32 68
88
FINDINGS: - The above bar graph shows that 25% Pepsi is available in grocery whereas
coke is available with 75%.
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TYPES OF OUTLETS
25
2532
75 7568
0
10
20
30
40
50
6070
80
90
GROCERY EATRY COVENIENT
OUTLETS
PERCENTAGE
PCI(%)
COKE(%)
25% Pepsi is available in entry whereas coke is available with 75%.
32% Pepsi is available in convenient whereas coke is available with 68%.
CHANNELS TOTAL OUTLETS
NO.OF PACKS(SKU)
PCI COKE
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Grocery
(General stores)
24 6 13
Entry
(Restaurant)
20 6 10
Convenient
(Pan shops ,cigarette shops)
44 4 12
88
AVAILABILITY OF TOTAL PACKS "SKU" (AVG)
6 6
4
13
10
12
0
2
4
6
8
10
12
14
Grocery Eatry convenient
CHANNELS
AV
ER
AG
E
FINDINGS: - The above graph shows that out of 88 outlets, the average number of packs
in pepsin is 6 whereas coke is 13 in grocery.
In entry, the average number of packs in Pepsi is 6 whereas coke is 10
In convenient, the average number of packs in Pepsi is 4 whereas
coke is 12.
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AVAILABILITY OF CHILLING CAP.(AVG)
0
50
100
150
200
250
300
350
GROCERY EATRY CONVENIENT
CHANNELS
AV
ER
AG
E
FINDINGS:-The above bar graph shows that out of 88 outlets the average chilling
capacity of Pepsi is 118 whereas coke average is 259 in grocery.
In entry, the average chilling capacity of Pepsi is 106 whereas coke is 300.
In convenient, the average chilling capacity of Pepsi is 69
whereas coke chilling capacity is 267.
SATISFACTION LEVEL
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CHANNELS TOTAL OUTLET CHILLING CAP.
PCI COKE
GROCERY 24 118 259
EATRY 20 106 300
CONVENIENT 44 69 267
88
SATISFACTION LEVEL
68
32
0
10
20
30
40
50
60
70
80
COKE PEPSI
BRANDS
PE
RC
EN
TA
GE
COKE
PEPSI
FINDINGS:-The above bar graph shows that coke has reached the higher satisfaction
level with 68% whereas PepsiCo is only with 32% having satisfactory level.
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BRANDS No. Of Retailers
%
COKE 60 68
PEPSI 28 32
88
STUDY ON RETAILERS
Retail Shop type:-
I. Monopoly Retail Shop : The shop selling only one company’s
Products
II. Mix Shop : The shop selling many company’s
Products
The retailers can build a great deal of goodwill for the firm. The marketing strength
depends on the strengths of retail dealers. Researchers had conducted survey on different types
of outlet like bakeries, cold drink parlor and general stores etc. According to these survey, the
major reasons for selling Pepsi products are:
Brand Image 18%
Customer Demand 20%
Profit Margin 05%
Advertisement 30%
Good Quality 10%
Sales Promotion for Retailers 07%
Sales Promotion for Consumers 10%
BRAND PREFRENCE
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Pepsi products are most popular brand but Coke products are very dear brand of consumers due
to advertisement.
After the collection of different views from consumer which includes servicemen,
students, businessman and observing the sale of Pepsi products thefollowing is the brand
preference of consumers in patna.
Brand Preference of Consumers:-
Flavors % Consumption
Cola 49%
Orange 16%
Lemon 12%
Lime 07%
Mango 17%
49%
16%12%
7%
17%
15%
Cola
Orange
Lemon
Lime
Mango
7 Up
STUDYING THE MARKET POTENTIAL
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Coca Cola
48%
Pepsi
52%
Pepsi
Coca Cola
The market potential is an estimate of the maximum possible sales opportunities present
in a particular market segment and open to all sellers of a good and service or during a stated
future period. A market potential indicates how much of a particular product can be sold to a
particular market segment. Market potential can be determined by measuring the sales in
different areas. The data has collected from 88outlets, which are situated in different areas of
Patna. According to that, the per day sale of Pepsi Products is 154 carats and the per day sale of
sale of Coke Products is 148 crates.
Per Day Sales in Carat of Products:-
CHAPTER-7
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CONCLUSION
1. Coca-Cola has invested more in the market. Distribution of VISI coolers and display of
glow sign board is much more as compared to Pepsi but after that Pepsi give it very tuff
competition.
2. Most of the dealers want glow signboard and chilling equipments, which they they keep
on asking from time to time as and when needed.
3. In the Coca Cola segment thumbs-up and lime segment sprit is the main competitors of
Pepsi. But mountain dew lonely defeats them all.
4. Due to high demand, there is crisis in the market.
5. Pepsi is more sweet and low fizz. And that is why it is not like by customer more.
6. Pepsi should provide more supporting goods which is helpful to enhance the market
share of the Pepsi.
7. Pepsi should try to always satisfy the dialers which may be a big factor to enhance the
market share.
8. There should be a proper supply of Pepsi product in the market.
9. There should be a proper interaction between dealers and company employees.
10. Pepsi has the entire flavor i.e. Cola, Leman, Orange, Mango in the market but still its
market share is comparatively less than Coke.
11. The majority of the retailers deal in all the brands of Pepsi and Coca-Cola.
SUGGESTION
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Lumbini Beverages Pvt. Ltd. should introduce some change in its marketing function
and advertising to make market more rational. The following factors are worthy of
consideration:-
A complain Register should be provided by the company to every distributor in every
route so that, retailers/customers can write their problems. The complaint register
should be checked by costumer executive and depot in charge from time to time.
A clear notification should be given to teach distributor and to give cash memo to each
route agent (with printed number) and maintain route card for every transaction.
All these tricycles who targets the tired and thirsty consumer of the road or other place,
care should be taken that soft drinks in the ice box are always chilled and is readily
available them.
The vendors can also be provided with uniform information by the company in order to
give them better visibility.
An appropriate name should be given to these tricycles and properly advertisement
should be done thus giving them some sort of identity.
Now a days with the introduction of tetra packs such as fruity, Tree Top etc., Lumbini
Beverages Pvt. Ltd. should also think of introducing such packs of its various brands of
beverages for better sale.
Lumbini beverages Pvt. Ltd. should be available in the rural area also.
The numbers of outlets are too much. So it is required to short the route and extra
vehicles/tricycles provide in this route.
At last only this can be said that these suggestions are important to be used by the
Lumbini Beverages Pvt. Ltd. As it would better the company sales in this state and is
certain that if these suggestions are carried out by management , it will helpful in
establishing the Lumbini Beverages Pvt. Ltd. on a more stronger footing.
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Glossary of Terms
Bibliography
GLOSSARY OF THE TERMS:-
FOBO - Franchise Owned Business Operation
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COBO - Company Owned Business Operation
FMCG - Fast Moving Consumer Goods
MNCs - Multi National Company
GOD - Glass on Deposit
RBG - Return on Bottle G
BIBLIOGRAPHY
www.pepsicoindia.com
www.pepsico.com
www.google.com
REFERENCES FROM BOOKS:-
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Kotler, Philip, Keller, Lane (2005) "Marketing Management", Prentice Hall, ISBN
0131457578.
Frey, A. (1961) Advertising, 3rd ed., Ronald Press, New York, 1961.
NEWS PAPERS & MAGZINE:-
The Times of India
The Economics Times
Hindustan Times
Business Today (July edition)
APPENDIX
A STUDY OF RETAIL OUTLETS AND THEIR
PROMOTION
QUESTIONNAIRE FOR RETAILERS
Name of the shop/outlet: ..................................................................
Address/Location : .......................................................................
Type of outlet : ........................................................................
(a) General Store (b) Pan Shop
(c) Sweet Shop (d) Lassi /Juice Shop
(e) Dhaba /Canteen (f) Others
l .Q. In which month Peak Season of Soft Drinks?
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(a) Jan-Feb (b) March-June
(c) July-Sept (d) Oct- Dec
2. Q. What is effect of advertisement on sales?
(a) Yes (b)No (c
3. Q. Are you satisfied with behaviors of staff visit?
(a) Excellent (b) Good
(c) Satisfactory (d) Poor (e) Very poor
4. Q Do you receive the delivery of PepsiCo products in time?
(a) Yes (b) No
5. Q what is percentage age share of satisfaction of distribution of PepsiCo and coke?
(a) PepsiCo (b) Coca Cola
6. Q. What is percentage share of chilling equipment’s?
(a) Pepsi (b) Coca-Cola
(c) Own
7. Which company’s signage you have in your outlet?
(a) Pepsi (b) Coca-Cola
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8. Q.Which types of product available always?
(a)PEPSICO
(b)Coke
(c) Both
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