A SUMMER TRAINING PROJECT REPORT

ON

SURVEY OF RETAILERS
TO KNOW THE EFFECTIVENESS OF
THE PROMOTIONAL ACTIVITY OF PEPSICO
SUBMITTED FOR PARTIAL FULFILLMENT OF
POST GRADUATE DIPLOMA IN BUSINESS MANAGEMENT

Faculty of Management Studies Institute of Rural Management

Submitted to:

Submitted by:

Dr. Susmit Jain

Aditya Tak

Faculty Guide

BM/JULY/09/22/1930

FMS-IRM, Jaipur

PGDM (2009-'11)

Mr. Himmat Shekhawat

Corporate Guide
VARUN BEVERAGES LIMITED

PREFACE
Theoretical study combined with practical knowledge
makes the learning meaningful and enables an individual
to develop self-confidence because theoretical knowledge
is always incomplete without its practical implication . As
the compulsory part of our PGDM curriculum in our
college, I did my summer training in PepsiCo (Varun
Beverages Limited) and prepared a detailed report on the same.
The title of my report is Survey of Retailers to Know the
Effectiveness of the Promotional Activity of PepsiCo.
An attempt has been made by this summer training which will
enable the researcher to gain more extensive knowledge and
understanding about the organization PepsiCo, its distribution
structure, ssmarketing strategy, retailers' response towards its
schemes, other practical facts and exposure to the corporate
working environment. This training will help to develop the skill
of a student in analyzing and interpreting problems through the
application of theory and conceptive technique of management.
This project will also enable me to learn the technique of
collecting data from the various sources available; the art of
compiling, evaluating and critically analyzing them.

ACKNOWLEGEMENT
It is almost inevitable to incur indebtedness to all who
generously helped me, by devoting their valuable time
and sharing their experiences with me without which this
project would never have been accomplished.
I would like to give special thanks to Dr. Susmit Jain,
academic guide for teaching me silver lining in every dark
cloud. I also extend my heartiest thanks to all the faculty
members of FMSIRM for their regular assistance
throughout the project.
I would like to convey my sincere thanks to Mr. Ritesh
Arora (Marketing Development Manager) for giving me
an opportunity to do my summer internship with Varun
Beverages Ltd. and my corporate guide Mr. Himmat
Shekhawat (Area Development Coordinator) for his
guidance, tremendous patience and understanding while
training and thereby helping me in bringing out my task
in the present shape.
I would also like to express gratitude towards Mr.
Wilson Alexander (Customer Executive, Varun Beverages
Ltd), for his indispensable advice, support and
encouragement throughout the project. Its a great
pleasure to acknowledge the gratitude I feel towards
other employees (Pre Sales Representatives) of Varun
Beverages, who have shared their ideas and experience,
which was of great help to me for the accomplishment of
the project.
Last but not the least, I acknowledge all the
respondents who have responded in the survey and have
made their contribution in the data collection.
3

CERTIFICATE
Certified that this project report entitled SURVEY OF
RETAILERS TO KNOW THE EFFECTIVENESS OF THE
PROMOTIONAL ACTIVITY OF PEPSICO is a record of
project work done independently by Mr. ADITYA TAK
under my guidance and supervision and that it has not
previously formed the basis for the award of any degree,
fellowship or associate ship to him.

Date:

Dr. Susmit Jain

Faculty Guide

DECLERATION
I hereby declare that this project entitled SURVEY
OF RETAILERS TO KNOW THE EFFECTIVENESS OF
THE PROMOTIONAL ACTIVITY OF PEPSICO is a
bonafide record of work done by me during the course of
summer internship and that it has not previously formed
the basis for the award to me for any degree/diploma,
associate ship, fellowship or other similar title, any other
institute/society.

Date:

ADITYA TAK
BM/JULY/09/22/1930

TABLE OF CONTENTS
S. NO.

CONTENTS

PAGE NO.
8-9

1.

EXECUTIVE SUMMARY

2.

INDIAN FMCG INDUSTRY

2.1 INTRODUCTION
2.2 CONTRIBUTION OF INDIAN FMCG INDUSTRY
2.3 OPPORTUNITIES
2.4 POLICY AND REGULATORY FRAMEWORK

3.

INDIAN FOOD & BEVERAGE INDUSTRY

3.1 BRIEF INSIGHT
3.2 SOFT DRINKS MARKET IN INDIA

4.

CORPORATE PROFILE
4.1 PEPSICO INTERNATIONAL
4.2 FINANCIAL PERFORMANCE
4.3 PEPSICO INDIA
4.4 PRODUCTS
4.5.CORPORATE SOCIAL RESPONSIBILITY IN INDIA

19-60

5.

VARUN BEVERAGES

61-66

6.

MARKETING STRUCTURE
6.2 DISTRIBUTION NETWORK
6.3 ORGANISATIONAL HIERARCHY

67-69

7.

THE GOLD CLUB SCHEME

7.1 TERMS RELATED
7.2 SALIENT FEATURES
7.3 MERCHANDIZING EQUIPMENTS

70-76

8.

LITERATURE REVIEW
8.1 MARKETING STRATEGY
8.2 RETAILER BUYING BEHAVIOUR

77-81

9.

RESEARH METHODOLOGY
9.1 OBJECTIVES OF THE STUDY
9.2 SCOPE OF THE STUDY
9.3 LIMITATIONS
9.4 RESEARCH PROCESS

82-88

10. DATA ANALYSIS AND INTERPRETATION

10.1 DATA ANALYSIS
10.2 INTERPRETATION
10.3 FINDINGS

89-103

11. SWOT, RECOMMENDATIONS & CONCLUSION

104-109

12. BIBLIOGRAPHY

110

13. QUESTIONNAIRE

111-112

10-14

15-18

CHAPTER-1
EXECUTIVE SUMMARY

EXECUTIVE SUMMARY
The report is an earnest endeavor made to understand the present market scenario in
beverages captured by PepsiCo, Jaipur.
The Researcher was required to bring out the potential by conducting a survey in
various retail shops so that the company could maintain the market leadership in the
existing business scenario in the packaged sweetened carbonated/non-carbonated
beverages.
The study encompasses the penetration of the existing Pepsi products (Beverages)
and the potential for improvement in the schemes.
The Researcher visited various urban areas of Jaipur. This was done to understand
the prevailing market scenario and supply status and distribution system in these Areas.
Through the study, The Researcher clearly understood that the Pepsi has deep penetrated
roots in these areas and there is huge potential to expand the market currently covered
over there.
The Researcher have mentioned the problems and the loop holes in the Pepsis
distribution system and the promotional tools, which they have found during the course
of the study and recommended various corrective measures for it.
The title of the study is SURVEY OF RETAILERS TO KNOW THE
EFFECTIVENESS OF THE PROMOTIONAL ACTIVITY OF PEPSICO. The
researcher is required to analyze the present stand of the Companys products in these
markets, and to see that all the flavours of Pepsi are available at the retail outlets with
proper Brand visibility.
The study also includes the market hold of Pepsi compared to Coca-Cola and other
local brands (RCQ, Jayanti, Campa-Cola, India top etc.) in the packaged carbonated
beverage section in the region. Currently, soft drink concentrate, snack foods and
vegetable and food processing are the key products of the company. Also, packaged
sweetened carbonated/non-carbonated beverages has become an important section of the
company in the present scenario, and is enjoyed by each age-group of the society viz.,
the kids, youngsters, and even the old people. The researcher is required to explore that
whether this plan would further be enhanced by the distributors.
In addition to this, the study is conducted to know that how the market is responding
to the Pepsis products, and any modifications needed in the current schemes.

CHAPTER-2
INDIAN FMCG INDUSTRY
CONTRIBUTION
OPPORTUNITIRS
POLICY & REGULATORY FRAMEWORK

10

2.1 INDIAN FMCG INDUSTRY: AN INTRODUCTION

The Fast Moving Consumer Goods (FMCG) industry in India is one of the largest
sectors in the country and over the years has been growing at a very steady pace. The
sector basically consists of consumer non-durable products, which broadly consists,
personal care, household care and food & beverages.
The Indian FMCG industry is largely classified as organized and unorganized. This
sector is also buoyed by intense competition. Besides competition, this industry is also
marked by a robust distribution network coupled with increasing influx of MNCs across
the entire value chain. This sector continues to remain highly fragmented.

The FMCG industry is volume driven and is characterized by low margins. The
products are branded and backed by marketing, heavy advertising, slick packaging and
strong distribution networks. The FMCG segment can be classified under the premium
segment and popular segment. The premium segment caters mostly to the higher/upper
middle class which is not as price sensitive apart from being brand conscious. The price
sensitive popular or mass segment consists of retailers belonging mainly to the semiurban or rural areas who are not particularly brand conscious. Products sold in the
popular segment have considerably lower prices than their premium counterparts.

11

2.2 CONTRIBUTION OF INDIAN FMCG INDUSTRY

After registering a 12% growth in 2009 despite the economic downturn, major
FMCG firms remain optimistic and expect a 15% growth in 2010. The Indian FMCG
industry sales are estimated to grow 14.5% to reach RS 854.7 Billion. Within the Indian
FMCG industry, there are few sectors that will grow more than 20% during 2009-2010,
like shaving cream at 23%, skin/fairness cream at 22%, shampoos at 21.3%, skin care &
cosmetics at 20%, tooth powder at 22% and other care products.
The prediction of higher sales growth of FMCG products is based on strong economic
fundamentals such as rising disposable income of people. Now people can afford to
spend on quality FMCG products. Moreover, increasing salaries, along with rising trend
of perks in the corporate sector at regular intervals, have increased peoples spending
power on lifestyle products. Even government employees too are expending on lifestyle
products helping FMCG sector to grow rapidly.
Apart from this, India is rapidly changing into an urban country and with that, peoples
preference for lifestyle products is growing. Hence, the Indian FMCG industry is
experiencing strong growth in some categories such as skin care, anti-aging solution,
deodorants, fairness products and mens products. In addition, the emergence of
organized retail such as supermarkets, and shopping malls is also playing an important
role in bringing boom in the Indian FMCG market. The young generation of consumers
is driving the demand for lifestyle products.
Consumers are at the front seat changing and redefining the branding and marketing
strategy and marketplace for the retail products that are ultimately boosting the retail
sales in the country. However, the fear of dissociation with earlier consumers still
persists as they embrace and prefer to stick to established brands only. The main reason
for this dissociation is weak distribution channels and marketing strategy in the country.
According to a Research Analyst at RNCOS, The demand for lifestyle products is
boosted by the rising aspiration and modern facilities. As the spending power of
consumers is going up, the sales of FMCG products in India will rise too. Therefore,
companies need to improve the quality of products and employ right marketing mix by
implementing new technologies such as Customer Relationship Management.

12

FEW FMCG MAJORS IN INDIA (APRIL 2010)

Critical operating rules in Indian FMCG sector

Heavy launch costs of new products on launch advertisements, free samples and
product promotions.
Majority of the product classes require very low investment in fixed assets.
Existence of contract manufacturing.
Marketing assumes a significant place in the brand building process.
Extensive distribution networks and logistics are the key to achieving a high level
of penetration in both the urban and rural markets.
Factors like low entry barriers in terms of low capital investment, fiscal
incentives from government and low brand awareness in rural areas have led to
the mushrooming of the unorganized sector.
Providing good price points is the key to success.
13

2.3 OPPORTUNITIES

With fast-evolving lifestyles and the increasing disposable income of urban

consumers, there exists a definite opportunity for lifestyle and high-end products.

With more than 33 per cent of the Indian consumer base present in rural areas, the
rural market will be a key growth driver for FMCG majors planning to expand
their domestic business.

Indian consumers are highly adaptable to new and innovative products. For
instance, the market acceptance of mens fairness creams clearly demonstrates an
opportunity for companies to offer new products targeting specific customer
segments.

Indian and multinational FMCG players can leverage India as a strategic sourcing
hub for cost-competitive product development and manufacturing for their
international markets.

2.4 POLICY AND REGULATORY FRAMEWORK

Automatic investment approval (including foreign technology agreements within

specified norms) up to 100 per cent foreign equity, or 100 per cent for NRI and
overseas corporate bodies (OCBs) investment, is allowed in food processing
segments such as coffee and tea.

The Government of India (GoI) recognizes food processing and agro industries as
priority sectors.

Industrial license is not required for almost all food and agro processing
industries, barring certain items such as beer, potable alcohol and wines, cane
sugar and hydrogenated animal fats and oils and items reserved for exclusive
manufacture in the small-scale sector.

The GoIs announcement of a 4 per cent reduction in excise duty (as part of the
earlier stimulus package in December 2008) has impacted the FMCG industry
positively.

In October 2009, the GoI amended the Sugarcane Control Order, 1966, and
replaced the Statutory Minimum Price (SMP) of sugarcane with Fair and
Remunerative Price (FRP) and the State Advised Price (SAP).

India is set to implement Goods and Services Tax (GST) by April 1, 2011. This
move is expected to stimulate growth in the Indian FMCG industry.

14

CHAPTER-3
INDIAN FOOD & BEVERAGE INDUSTRY
SOFT DRINKS MARKET IN INDIA

15

3.1 FOOD AND BEVERAGE INDUSTRY IN INDIA:

A BRIEF INSIGHT
FOOD
According to the Ministry of Food Processing, the size of the Indian food processing
industry is around US$ 65.6 billion including US$ 20.6 billion of value added products.
Of this, the health beverage industry is valued at US$ 230 billion; bread and biscuits at
US$ 1.7 billion; chocolates at US$ 73 million and ice creams at US$ 188 million. The
size of the semi-processed/ready to eat food segment is over US$ 1.1 billion. Large
biscuits & confectionery units, soya processing units and starch/glucose/sorbitol
producing units have also come up, catering to domestic and international markets. The
three largest consumed categories of packaged foods are packed tea, biscuits and soft
drinks.

BEVERAGES
The Indian beverage industry faces over supply in segments like coffee and tea.
However, more than half of this is available in unpacked or loose form. Indian hot
beverage market is a tea dominant market. Consumers in different parts of the country
have heterogeneous tastes. Dust tea is popular in southern India, while loose tea in
preferred in western India. The urban-rural split of the tea market is 51:49 in 2000.
Coffee is consumed largely in the southern states. The size of the total packaged coffee
market is 19,600 tons or US$ 87 million. The urban rural split in the coffee market iss
61:39. The total soft drink (carbonated beverages and juices) market is estimated at 284
million crates a year or US$ 1 billion. The market is highly seasonal in nature with
consumption varying from 25 million crates per month during peak season to 15 million
during offseason. The market is predominantly urban with 25 per cent contribution from
rural areas. Coca cola and Pepsi dominate the Indian soft drinks market. Mineral water
market in India is a 65 million crates (US$ 50 million) industry. On an average, the
monthly consumption is estimated at 4.9 million crates, which increases to 5.2 million
during peak season.
In India, beverages form an important part of the lives of people. It is
an industry, in which the players constantl y innovate, in order to come up
with better products to gain more retailers and s atisfy the existing
retailers.

16

BEVERAGES

Alcoholic

Non-Alcoholic

Carbonated

Cola

Non-Carbonated

Non-Cola

Non-Cola

FIGURE: BEVERAGE INDUSTRY IN INDIA

The beverage industry is vast and there various ways of segmenting it,
so as to cater the right product to the right person. The different ways of
segmenting it are as follows:

Alcoholic, non-alcoholic and sports beverages .

Natural and S ynthetic beverages.
In-home consumption and out of home on premises consumption.
Age wise segmentation i.e. beverages for kids, for adults and for
senior citizens.
Segmentation based on the amount of c onsumption i.e. high levels
of consumption and low levels of consumption.

If the behavioral patterns of retailers in India are closel y noticed, it

could be observed that retailers perceive beverages in two different ways
i.e. beverages are a luxury and that beverages have to be consumed
occasionall y. These two perceptions are the biggest challenges faced by
the beverage industry. In order to leverage the beverage industry, it is
important to address this issue so as to encourage regular consumption as
well as and to mak e the industry more affordable.

17

Four strong strategic elements to increase consumption of the products

of the beverage industry in India are:

The qualit y and the consistency of beverages needs to be enhanced

so that retailers are satisfi ed and they enjoy consuming beverages.

The credibilit y and trust needs to be built so that there is a very

strong and safe feeling that the retailers have while consuming the
beverages.

Retailer education is a must to bring out benefits of beverage

consumption whether in terms of health, taste, relaxation,
stimulation, refreshment, well -being or prestige relevant to the
category.

Communication should be relevant and trendy so that retailers are

able to find an appeal to go out, purchase and consume.

The beverage market has still to achieve greater penetration and also a
wider spread of distribution. It is important to look at the entire beverage
market, as a big opportunit y, for brand and sales growth in turn to add up
to the overall growth of the food and beverage industry in the econom y.

3.2 SOFT DRINKS MARKET IN INDIA

India is one of the top five markets in terms of growth of the soft
drinks market. The per capita consumption of soft drinks in the country is
estimated to be around 6 bottles per annum in the year 2009. It is very
low compared to the corresponding figures in US (600+ bottles per
annum). But being one of the fastest growing markets and by the sheer
volumes, India is a promising market for soft drinks. The major players in
the soft drinks market in India are PepsiCo and Coca -Cola Co, like
elsewhere in the world. Coca -Cola acquired a number of local brands like
Limca, Gold Spot and Thums Up when it entered Indian market for the
second time. Pepsi Cos soft drink portfolio also consists of Mi randa and
7Up along with Pepsi. The market share of each of the company is more
or less the same, though there is a conflict in the estimates quoted by
different sources.
The major ingredient in a soft drink is water. It constitutes close to
90% of the soft drink content. Added to this, the drink also contains
sweeteners,
Carbon
dioxide,
Citric
Acid/Malic
acid,
Colors,
Preservatives, Anti Oxidants and other emulsifying agents, etc.

CONSUMPTION PATTERNS IN INDIA

In Tier 1, 2 and 3 cities in India, 29% of Indian consumers report consuming
carbonated beverages/soft drinks during a fixed time of the day suggesting consumption
has become a routine part of their day, with most consumption taking place during the
'afternoon to evening' time period. Not surprisingly, consumption is highest in Tier I
cities such as Mumbai, Delhi, Kolkata, Chennai, Hyderabad and Bangalore. The level of
consumption is seen to increase with rising household incomes (with the exception of the
highest income level) while decreasing with age.
18

CHAPTER-4
PEPSICO INTERNATIONAL
PEPSICO INDIA
PRODUCTS
CSR-INDIA

19

Type

Public (NYSE: PEP)

Industry

Food
Non-alcoholic beverage

Founded

New Bern N.C, U.S. (1890)

Founder(s)

Caleb Bradham, Donald M.

and Herman W. Lay

Headquarters

Purchase, New York, U.S.

Area served

Worldwide

Key people

Indra Nooyi
(Chairperson and CEO)

Revenue

US$44.3 billion

Operating
Income

US$7.3 billion

Net income

US$6.24 billion

Total assets

US$39.8 Billion
(FY 2009)

Total equity

US$16.8 Billion
(FY 2009)

Employees

203,000 (2010)

Divisions

PepsiCo Americas (PepsiCo

America Food, PepsiCo Americas
Beverages), PepsiCo International

Website

PepsiCo.com

20

4.1 PEPSICO INTERNATIONAL

MISSSION & VISION
MISSION
PepsiCos mission is to be the world's premier consumer Products Company focused on
convenient foods and beverages. It seeks to produce financial rewards to investors as it
provides opportunities for growth and enrichment to its employees, its business partners
and the communities in which it operate. And in everything it do, it strives for honesty,
fairness and integrity.

VISION
"PepsiCo's responsibility is to continually improve all aspects of the world in which it
operates - environment, social, economic - creating a better tomorrow than today."
PepsiCos 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.

PERFORMANCE WITH PURPOSE

PepsiCo is committed to achieving business and financial success while leaving a
positive imprint on society - delivering what it calls Performance with Purpose.
PepsiCos approach to superior financial performance is straightforward - drive
shareholder value. By addressing social and environmental issues, it also delivers on its
purpose agenda, which consists of human, environmental, and talent sustainability.

VALUES & PHILOSOPHY

Commitment
PepsiCo is committed to delivering sustained growth through empowered people acting
responsibly and building trust.

What It Means
Sustained Growth is fundamental to motivating and measuring its success. PepsiCos
quest for sustained growth stimulates innovation, places a value on results, and helps to
understand whether today's actions will contribute to its future. It is about the growth of
people and company performance. It prioritizes both making a difference and getting
things done.
Empowered People means it has the freedom to act and think in ways that it feel will
get the job done, while adhering to processes that ensure proper governance and being
mindful of company needs beyond its own.

21

Responsibility and Trust form the foundation for healthy growth. It holds itself both
personally and corporately accountable for everything it does. It must earn the
confidence others place as individuals and as a company. By acting as good stewards of
the resources entrusted to it, it strengthens that trust by walking the talk and following
through on its commitment to succeeding together.

Guiding Principles
It upholds its commitment with six guiding principles.
It must always strive to:
1. Care for its customers, its consumers and the world it live in
PepsiCo is driven by the intense, competitive spirit of the marketplace, but it direct
this spirit toward solutions that benefit both its company and its constituents.
PepsiCos success depends on a thorough understanding of its customers, consumers
and communities. To foster this spirit of generosity, it goes the extra mile to show it
care.
2. Sell only products it can be proud of
The true test of its standards is its own ability to consume and personally endorse
the products it sells. PepsiCos confidence helps ensure the quality of its products,
from the moment it purchase ingredients to the moment it reaches the consumer's
hand.
3. Speak with truth and candor
It tells the whole story, not just what's convenient to its individual goals. In addition
to being clear, honest and accurate, PepsiCo is responsible for ensuring its
communications is understood.
4. Balance short term and long term
In every decision, it weighs both short-term and long-term risks and benefits.
Maintaining this balance helps sustain its growth and ensures its ideas and solutions
are relevant both now and in the future.
5. Win with diversity and inclusion
It embraces people with diverse backgrounds, traits and ways of thinking. PepsiCos
diversity brings new perspectives into the workplace and encourages innovation, as
well as the ability to identify new market opportunities.
6. Respect others and succeed together
PepsiCos mutual success depends on mutual respect, inside and outside the
company. It requires people who are capable of working together as part of a team
or informal collaboration. While its company is built on individual excellence, it
also recognizes the importance and value of teamwork in turning its goals into
accomplishments.
22

STRATEGIES TO DRIVE GROWTH

PepsiCo focuses on delivering top-quartile financial performance in both the near term
and the long term, while making the global investments in key regions and targeted
product categories to drive sustainable growth. It has identified the following key
challenges and related competitive strategies for driving growth that it believe will
enable them to achieve its objectives.
PepsiCos growth is founded on six long-term growth strategies:

1. Expand the Global Leadership Position of PepsiCos Snacks Business.

PepsiCo is the global snacks leader, with the No. 1 savory category share position in
virtually every key region across the globe. It has advantaged positions across the entire
value chain in more than 40 developed and developing regions in which it operates as it
capitalize on local manufacturing and optimized go-to-market capabilities in each region,
as well as the ability to introduce locally relevant products using global capabilities. And
it has significant growth opportunities as it expand its current businesses in these regions,
extend its reach into new geographies and enter adjacent categories. Importantly,
PepsiCo continues to make its core snacks healthier through innovations in healthier oil,
sodium reduction and the addition of whole grains, nuts and seeds.

2. Ensure Sustainable, Profitable Growth in Global Beverages

The merger with its anchor bottlers creates a lean, agile organization in North America
with an optimized supply chain, a flexible go-to-market system and enhanced innovation
capabilities. When combined with the actions PepsiCo is taking to refresh its brands
across the entire beverage category, it believes this game-changing transaction will
enable us to accelerate its top-line growth and also improve its profitability. It continues
to see significant areas of global beverage growth, particularly in developing markets and
in evolving categories. PepsiCo will invest in those attractive opportunities,
concentrating in geographies and categories in which PepsiCo is the leader or a close
second, or where the competitive game remains wide open. Additionally, it will use its
R&D capabilities to develop low- and zero-calorie beverages that taste great and add
positive nutrition such as fiber, vitamins and calcium.

3. Unleash the Power of One

PepsiCo is in the unique position to leverage two extraordinary consumer categories that
has special relevance to retailers across the globe. PepsiCos snacks and beverages is
both high-velocity categories; both generate retail traffic; both is very profitable; and
both deliver exceptional cash flow. The combination of snacks and beverageswith its
high-demand global and local brandsmakes PepsiCo an essential partner for large
format as well as small-format retailers. PepsiCo will increasingly use this portfolio and
the high coincidence of consumption of these products through integrated offerings
(products, marketing and merchandising) to create value for consumers and deliver
greater top-line growth for retailers. It also will be accelerating Power of One supply
chain and back-office synergies in many regions to improve profitability and enhance
customer service.

23

4. Rapidly Expand PepsiCos Good-for-You Portfolio

PepsiCo Concurrently has a roughly $10 billion core of Good-for-You products
anchored by: Tropicana, Naked juice, Lebedyansky, Sandora and its other juice brands;
Aquafina; Quaker Oats; Gatorade (for athletes); the new dairy joint venture with
Almarai; and local Good-for-You products and brands. PepsiCo will build on this core
with an increasing stream of science-based innovation derived from the R&D capabilities
that it has been ramping up over the past couple of years, as well as from targeted
acquisitions and joint ventures. PepsiCo will be investing to accelerate the growth of
these platforms, and it will use the knowledge from these initiatives to improve its core
snack and beverage offerings and also to develop highly nutritious products for under
nourished people across the world.

5. Continue to Deliver on PepsiCos Environmental Sustainability Goals and

Commitments.
PepsiCo is committed to protecting the Earths natural resources and is well on its way to
meeting its public goals for meaningful reductions in water, electricity and fuel usage.
PepsiCos businesses around the world is implementing innovative approaches to be
significantly more efficient in the use of land, energy, water and packagingand
PepsiCo is actively working with the communities in which it operate to be responsive to
their resource needs. In 2009, it formalized its commitment to water as a human right,
and it will focus not only on world-class efficiency in its operations, but also on
preserving water resources and enabling access to safe water. PepsiCos climate change
focus is on reducing its carbon footprint, including a reduction in absolute greenhouse
gas emissions through continued improvement in energy efficiency and the use of
alternative energy sources. It actively works with farmers to promote sustainable
agricultureand PepsiCo is developing new packaging alternatives in both snacks and
beverages to reduce its impact on the environment.

6. Cherish PepsiCos Associates and Develop the Leadership to Sustain

PepsiCos Growth
It has an extraordinary talent base across the globein its manufacturing facilities, its
sales and distribution organizations, its marketing groups, its staff functions and with its
general managers. As it expand its businesses, PepsiCo is placing heightened focus on
ensuring that it maintain an inclusive environment and on PepsiCo, Inc. 2009 Annual
Report developing the careers of its associatesall with the goal of continuing to has the
leadership talent, capabilities and experience necessary to grow its businesses well into
the future. As an example, PepsiCo is implementing tailored training programs to
provide its managers and senior executives with the strategic and leadership capabilities
required in a rapidly changing environment.
Its a promise to strive to deliver superior, sustainable financial performance.

Performance
Top line:

Grow international revenues at two times real global GDP growth rate.
Grow savory snack and liquid refreshment beverage market share in the top 20
markets.
Sustain or improve brand equity scores for PepsiCos 19 billion-dollar brands in
top 10 markets.
Rank among the top two suppliers in customer (retail partner) surveys where
third-party measures exist.
24

Bottom line:

Continue to expand division operating margins.

Increase cash flow in proportion to net income growth over three-year windows.
Deliver total shareholder returns in the top quartile of its industry group.

Values:

Utilize a robust corporate Governance structure to consistently score in the top

quartile of corporate Governance metrics.
Ensure value commitment to deliver sustained growth through empowered people
acting with responsibility and building trust.

PEPSICOS OPERATIONS
PepsiCo is organized into three business units, as follows:
(1) PepsiCo Americas Foods (PAF), which includes Frito-Lay North America
(FLNA), Quaker Foods North America (QFNA) and all of its Latin American
food and snack businesses (LAF), including its Sabritas and Gamesa businesses
in Mexico;
(2) PepsiCo Americas Beverages (PAB), which includes PepsiCo Beverages North
America and all of its Latin American beverage businesses; and
(3) PepsiCo International (PI), which includes all PepsiCo businesses in Europe and
all PepsiCo businesses in Asia, Middle East and Africa (AMEA).
PepsiCos three business units are comprised of six reportable segments (referred to as
divisions), as follows:
FLNA,
QFNA,
LAF,
PAB,
Europe, and
AMEA.

Asia, Middle East & Africa

AMEA makes markets and sells a number of leading snack food brands including Lays,
Kurkure, Chipsy, Doritos, Smiths, Cheetos, Red Rock Deli and Ruffles, through
consolidated businesses as well as through non controlled affiliates. Further, either
independently or through contract manufacturers, AMEA makes markets and sells many
Quaker-brand cereals and snacks. AMEA also makes markets and sells beverage
concentrates, fountain syrups and finished goods, under various beverage brands
including Pepsi, Mirinda, 7UP and Mountain Dew. These brands are sold to authorized
bottlers, independent distributors and retailers. However, in certain markets, AMEA
operates its own bottling plants and distribution facilities. In addition, AMEA licenses
the Aquafina water brand to certain of its authorized bottlers. AMEA also, both
independently or through contract manufacturers, makes markets and sells ready-to-drink
tea products through an international joint venture with Unilever (under the Lipton brand
name). AMEA reports two measures of volume (see Europe above).

25

PepsiCos Customers
PepsiCos customers include authorized bottlers and independent distributors, including
foodservice distributors and retailers. It normally grants its bottlers exclusive contracts to
sell and manufacture certain beverage products bearing its trademarks within a specific
geographic area. These arrangements provide it with the right to charge its bottlers for
concentrate, finished goods, Aquafina royalties and specify the manufacturing process
required for product quality. Since it does not sell directly to the consumer, it relies on
and provides financial incentives to its customers to assist in the distribution and
promotion of its products. For its independent distributors and retailers, these incentives
include volume-based rebates, product placement fees, promotions and displays. For its
bottlers, these incentives is referred to as bottler funding and is negotiated annually with
each bottler to support a variety of trade and consumer programs, such as consumer
incentives, advertising support, new product support, and vending and cooler equipment
placement. Consumer incentives include coupons, pricing discounts, promotions and
other promotional offers. Advertising support is directed at advertising programs and
supporting bottler media. New product support includes targeted consumer and retailer
incentives and direct marketplace support, such as point-of purchase materials, product
placement fees, media and advertising. Vending and cooler equipment placement
programs support the acquisition and placement of vending machines and cooler
equipment. The nature and type of programs vary annually. Retail consolidation and the
current economic environment continue to increase the importance of major customers.

REPORTING POTENTIAL VIOLATIONS OF THE CODE OF CONDUCT

PepsiCo expects its employees, contractors, agents, customers and suppliers to promptly
report any conduct or situation that she/he believes conflicts with this Code or violates a
local, state or federal law to their immediate supervisor, Human Resources or through the
PepsiCo Speak Up line at:
1-866-729-4888 (from the U.S., Canada, Puerto Rico and U.S. Virgin Islands)
For a list of phone numbers for all other countries, go to:
http://www.pepsico.com/PEP_Citizenship/CodeofConduct/SpeakUp/index.cfm
Reports can be made anonymously, and the Speak Up line is available toll-free 24 hours
a day.
Reports may also be made electronically by using the Speak up Online at
https://speakup.eaitbline.com. The same protections of anonymity and confidentiality
provided through its telephone Speak Up process are also provided through its online
portal. PepsiCo is committed to reviewing any report made in good faith in a prompt
manner and taking remedial action when appropriate. Every affected employee is
required to fully cooperate with any inquiry that results from any reported conduct or
situation. PepsiCo is also committed to protecting the rights of those individuals who
report these issues to PepsiCo. Any PepsiCo employee who is found to have engaged in
retaliation against any employee who has exercised his/her rights under this Code or
under applicable laws will be subject to appropriate remedial action. In addition, those
individuals who violate applicable law may also be subject to civil and criminal
penalties.

26

PEPSI- COLA BRANDS

Pepsi

Mountain Dew
Pepsi
Caffeine Free Pepsi
Diet Pepsi
Caffeine Free Diet
Pepsi
Diet Pepsi Max
Jazz Diet Pepsi
Diet Pepsi Lime
Diet Pepsi Vanilla
Pepsi Wild Cherry
Diet Pepsi Wild
Cherry
Pepsi ONE

Mountain Dew
Diet Mountain Dew
Caffeine Free
Mountain Dew
Mountain Dew Code
Red
Diet Mountain Dew
Code Red
Mountain Dew
LiveWire
Mountain Dew
Voltage

AMP Energy
Sierra Mist

Sierra Mist
Diet Sierra Mist
Sierra Mist
Cranberry Splash
Sierra Mist Free
Cranberry Splash

Tropicana

Tropicana lemonade
and punches
Tropicana Light
lemonade and
punches
Tropicana Twister
sodas

SoBe

Ocean Spray (License)

Ocean Spray juices

Ocean Spray juice
drinks

AMP Energy
AMP Energy Sugar
Free
AMP Energy
Overdrive
AMP Energy
Relaunch
AMP Energy
Traction
AMP Energy Elevate
AMP Energy Shot

SoBe juice drinks,

dairy, and teas
SoBe Lean diet juice
drinks, dairy, and
teas
SoBe Life Water
SoBe Adrenaline
Rush

Aquafina
More

Ethos Water
(License)
Manzanita Sol
Slice
FruitWorks juice
drinks
Mirinda

Aquafina
Aquafina
FlavorSplash
Aquafina Sparkling

Mug Root Beer

Mug Root Beer

Diet Mug Root Beer
Mug Cream Soda
Diet Mug Cream
Soda

No Fear

No Fear
No Fear Motherload
Sugar Free No Fear
Motherload

Dole (License)

Dole juices and juice

drinks
Dole Plus fortified
juices

Lipton (Partnership)

Lipton Brisk
Lipton Iced Tea
Lipton Pure Leaf

Outside North America

Mirinda
7UP (International)
Pepsi Limn
Kas
Teem
Pepsi Max
Pepsi Light
Manzanita Sol
Paso de los Toros
Fruko
Evervess
Yedigun
Shani
Fiesta
D&G (License)
Mandarin (License)
Radical Fruit
27

Starbucks (Partnership)

Frappuccino readyto-drink coffee

Starbucks
Doubleshot
Starbucks
Doubleshot Energy
Starbucks Iced
Coffee

FRITO-LAYS BRANDS

Lay's potato chips

Lay's Kettle Cooked
potato chips
Wavy Lay's potato
chips
Baked Lay's potato
crisps
Maui Style potato
chips
Ruffles potato chips
Baked Ruffles potato
crisps
Ruffles Flavor Rush
potato chips
Doritos tortilla chips
Baked Doritos tortilla
chips
3D's snacks
Tostitos tortilla chips
Baked Tostitos
tortilla chips
Santitas tortilla chips
Fritos corn chips
Cheetos cheese
flavored snacks
Rold Gold pretzels &
snack mix
Funyuns onion
flavored rings
Go Snacks
Sunchips multigrain
snacks
Sabritones puffed
wheat snacks
Cracker Jack candy
coated popcorn
Chester's popcorn

Grandma's cookies Outside North America

Munchos potato
Bocabits wheat
crisps
snacks
Smartfood popcorn

Crujitos corn snacks

Baken-ets fried pork
Fandangos corn
skins
snacks
Oberto meat snacks
Hamka's snacks
Rustler's meat snacks
Niknaks cheese
Churrumais fried
snacks
corn strips

Quavers potato
Frito-Lay nuts
snacks
Frito-Lay, Ruffles,
Sabritas potato chips
Fritos and Tostitos
Smiths potato chips
dips & salsas
Walkers potato crisps
Frito-Lay, Doritos
Walkers Square
and Cheetos snack
potato snacks
crackers

Walkers French Fries

Fritos, Tostitos,
potato sticks
Ruffles and Doritos

Walkers Monster
snack kits
Munch corn snacks
Hickory Sticks

Gamesa cookies
Hostess Potato
Doritos Dippas
Lay's Stax potato
Sonric's sweet snacks
crisps
Wotsits corn snacks
Doritos Rollitos
Walkers Sensations
Lay's Fries
Doritos A La Turca
Natural Lays
Lay's Mediteranneas
Natural Ruffles
Red Rock Deli
Natural Cheetos
Kurkure
Natural Tostitos
Smiths Sensations
Miss Vickie's potato
Lays Artesanas PC
chips
Cheetos Shots
Munchies snack mix
Quavers Snacks

28

GATORADE BRANDS

Gatorade Thirst
Quencher
Gatorade Frost Thirst
Quencher
Gatorade Ice Thirst
Quencher
Gatorade Xtremo
Thirst Quencher
Gatorade X-Factor
Thirst Quencher
Gatorade Fierce
Thirst Quencher
Propel Fitness Water

Tiger Red Drive

Tiger Cool Fusion
Tiger Quite Storm
G2 Fruit Punch
G2 Orange
G2 Grape

TROPICANA BRANDS
Outside North America

Tropicana Pure
Premium juices
Tropicana Twister
juice drinks
Tropicana Smoothies
Tropicana Pure
Tropics juices
Dole juices (License)
Tropicana 100 juices
Naked Juice

Tropicana Touche de
Lait
Alvalle gazpacho
fruit juices and
vegetable juices
Tropicana Season's
Best juices and juice
drinks
Loza juices and
nectars
Copella juices
Frui'Vita juices

29

4.2 FINANCIAL PERFORMANCE (2009)

Financial Highlights
PepsiCo, Inc. and subsidiaries
(In millions except per share data; all per share amounts assume dilution)

a) Percentage changes are based on unrounded amounts.

b) Excludes corporate unallocated expenses, restructuring and impairment charges
and PBG and PAS merger costs.
c) Excludes restructuring and impairment charges, PBG and PAS merger costs and
the net mark-to-market impact of our commodity hedges.
d) Includes the impact of net capital spending, and excludes the impact of a
discretionary pension contribution, cash payments for PBG and PAS merger costs
and restructuring-related cash payments. See also Our Liquidity and Capital
Resources in Managements Discussion and Analysis.
e) Assumes constant currency exchange rates used for translation based on the rates
in effect in 2008.
30

31

PEPSICO MEGA-BRANDS
PepsiCo, Inc. has 19 mega-brands that generate $1 billion or more each in
annual retail sales (estimated worldwide retail sales in billions).

32

PEPSICO DELIVERED SOLID FINANCIAL PERFORMANCE IN 2009

Amidst the most challenging global macroeconomic environment in decades, it
demonstrated the strength and resilience of both its people and portfolio by delivering
solid operating performance and generating significant operating cash flow.
Net revenue grew 5% on a constant currency basis.
Core division operating profit rose 6% on a constant currency basis.
Core EPS grew 6% on a constant currency basis.
Management operating cash flow, excluding certain items, reached $5.6 billion,
up 16%.
And, it raised the annual dividend by 6%.

Future Plans
Products:

Provide more food and beverage choices made with wholesome ingredients that
contribute to healthier eating and drinking.
Increase the amount of whole grains, fruits, vegetables, nuts, seeds and low-fat
dairy in its global product portfolio.
Reduce the average amount of sodium per serving in key global food brands by
25 percent.
Reduce the average amount of saturated fat per serving in key global food brands
by 15 percent.
Reduce the average amount of added sugar per serving in key global beverage
brands by 25 percent.

33

PepsiCo will also launch and distribute products directly aimed at addressing
nutritional deficiencies and will launch a pilot program that directly delivers
against the United Nations Millennium Development Goal to eradicate extreme
poverty and hunger by 2015.

Marketplace:

Encourage people to make informed choices and live healthier.

Display calorie count and key nutrients on its food and beverage packaging by
2012.
Advertise to children less than 12 years only products that meet its global
science-based nutrition standards.
Eliminate the direct sale of full-sugar soft drinks in primary and secondary
schools around the globe by 2012.
Increase the range of foods and beverages that offer solutions for managing
calories, like portion sizes.

Environment:

Improve its water use efficiency by 20 percent per unit of production by 2015.
Strive for positive water balance in its operations in water-distressed areas.
Provide access to safe water to three million people in developing countries by
the end of 2015.
Continue to lead the industry by incorporating at least 10 percent recycled
polyethylene terephthalate (rPEt) in its primary soft drink containers in the U.S.,
and broadly expand the use of rPEt across key international markets.
Create partnerships that promote the increase of U.S. beverage container
recycling rates to 50 percent by 2018.
Reduce packaging weight by 350 million poundsavoiding the creation of one
billion pounds of landfill waste by 2012.
Work to eliminate all solid waste to landfills from its production facilities climate
change.
Reduce the carbon footprint of its operations.
Improve its electricity use efficiency by 20 percent per unit of production by
2015.
Reduce its fuel use intensity by 25 percent per unit of production by 2015.
Commit to a goal of reducing greenhouse gas (ghg) intensity for U.S. operations
by 25 percent through its partnership with the U.S. Environmental Protection
agency climate leaders program.

34

4.3 PEPSICO INDIA

PepsiCo established its business operations in India in the year 1989.

It is now the 4th largest consumer products company in India.
PepsiCo has invested more than USD 1 billion in India since its establishment.
PepsiCo has a diverse range of products from Tasty Treats to Healthy Eats.
It provides direct and indirect employment to 150,000 people in India.
It has more than 36 bottling plants including 13 Company & 23 Franchise owned
ones.
It has 3 state-of-the-art food plants in Punjab, Maharashtra and West Bengal.
Of the energy used in PepsiCo Indias beverage business, 38 per cent comes from
renewable resources.

HISTORY
In this new era of business environment, the survival of a company depends upon the
differentiability of its product and services. Increasing competition in the business field,
across the world, suggest that a business firm must be more careful in their choice of
strategies in order to remain competitive. Organizations have realized that they must also
derive competitive advantage from the effective management of their market share. This
calls for the continuous improvement & up gradation of its product and services
according to the needs of customers and end consumers.
After a not so successful attempt to enter the Indian market in 1985, Pepsi re-entered
in 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. By 1994, Pepsi took
advantage of the liberalized policies and took control of Pepsi Foods by making an offer
to both Voltas and PAIC to buy their equity. The Indian government gave concessions to
the company, Pepsi was allowed to increase its turnover of beverages component to
beyond 25 per cent and was no longer restricted by its commitment to export 50 per cent
of its turnover. The government also allowed PepsiCo to set up a new company in India
called PepsiCo India Holdings Pvt. Ltd, a wholly owned subsidiary of PepsiCo
International, which is engaged in beverage manufacturing, bottling and exports
activities as Pepsi Foods Ltd. Since then, the company has bought over bottlers in
different parts of India along with Dukes, a popular soft-drink brand in western India to
consolidate its market share. This was followed by an introduction of Tropicana juice in
the New Delhi and Bangalore markets in 1999.
PepsiCo is one of the worlds largest food and beverage companies, with revenues of
nearly $60 billion. PepsiCo offers the worlds largest portfolio of billion-dollar food and
beverage brands, including 19 different product lines that each generates more than $1
billion in annual retail sales. Our main business - Frito-Lay, Quaker, Pepsi-Cola,
35

Tropicana and Gatorade also make hundreds of other nourishing, tasty foods and
drinks that bring joy to our consumers in more than 200 countries.
PepsiCo is concentrating on three focus areas - soft drink concentrate, snack foods
and vegetable and food processing. PepsiCo's success is the result of superior products,
high standards of performance and distinctive competitive strategies. Pepsi considers
India, along with China, as one of the two largest and fastest growing businesses outside
North America. The company has set up 8 Greenfield sites in backward regions of
different states. PepsiCo brands are available in nearly 200 markets across the world.
In 2003, the Centre for Science and Environment (CSE), a non-governmental
organization in New Delhi, said aerated waters produced by soft drinks manufacturers in
India, including multinational giants PepsiCo and The Coca-Cola Company, contained
toxins, including lindane, DDT, malathion and chlorpyrifos pesticides that can
contribute to cancer, a breakdown of the immune system and cause birth defects. Tested
products included Coke, Pepsi, 7 Up, Mirinda, Fanta, Thums Up, Limca, and Sprite. CSE
found that the Indian-produced Pepsi's soft drink products had 36 times the level of
pesticide residues permitted under European Union regulations; Coca Cola's 30 times.
CSE said it had tested the same products in the US and found no such residues.
However, this was the European standard for water, not for other drinks. No law bans the
presence of pesticides in drinks in India.
The Coca-Cola Company and PepsiCo angrily denied allegations that their products
manufactured in India contained toxin levels far above the norms permitted in the
developed world. But an Indian parliamentary committee, in 2004, backed up CSE's
findings and a government-appointed committee, is now trying to develop the world's
first pesticides standards for soft drinks. Coke and PepsiCo opposed the move, arguing
that lab tests aren't reliable enough to detect minute traces of pesticides in complex
drinks.
As of 2005, The Coca-Cola Company and PepsiCo together hold 95% market share
of soft-drink sales in India. PepsiCo has also been accused by the Puthussery panchayat
in the Palakkad district in Kerala, India, of practicing "water piracy" due to its role in
exploitation of ground water resources resulting in scarcity of drinking water for the
panchayat's residents, who have been pressuring the government to close down the
PepsiCo unit in the village.
In 2006, the CSE again found that soda drinks, including both Pepsi and Coca-Cola,
had high levels of pesticides in their drinks. Both PepsiCo and The Coca-Cola Company
maintain that their drinks are safe for consumption and have published newspaper
advertisements that say pesticide levels in their products are less than those in other
foods such as tea, fruit and dairy products. In the Indian state of Kerala, sale and
production of Pepsi-Cola, along with other soft drinks, was banned by the state
government in 2006, but this was reversed by the Kerala High Court merely a month
later. Five other Indian states have announced partial bans on the drinks in schools,
colleges and hospitals.

36

MISSION & VISION

PEPSICO INDIAS MISSION
To be the world's premier consumer Products Company focused on convenience food
and beverages. It seeks to produce healthy financial rewards to investors as it provides
opportunities for growth and enrichment to its employees, its business partners and the
communities in which it operate. And in everything it do, it strive for honesty, fairness
and integrity."

PEPSICO INDIAS VISION

To build Indias leading total beverage company, delighting consumers by best meeting
their everyday beverage needs, and stakeholders, by delivering performance with
purpose, through its talented people."

PEPSICO INDIAS SUSTAINABILITY VISION

PepsiCos responsibility is to continually improve all aspects of the world in which it
operates environment, social, economic creating a better tomorrow than today".

ORGANIZATIONAL VALUES
PepsiCos commitment is to deliver sustained growth, through empowered people, acting
with responsibility and building trust.

CODE OF CONDUCT
Each year, every PepsiCo associate is asked to review PepsiCo's Worldwide Code of
Conduct and recommit to living by it. Associates receive training in the Code, which is
available in 38 languages. In 2005, PepsiCo took additional steps to ensure that key
associates understood every aspect of the Code by developing online and written training
and certification that all executives and associates are required to complete.

37

COMMITMENT
PepsiCo Indias values reflect its aspirations - the kind of company PepsiCo want to be.
It expresses its values in the form of a commitment.

Sustained Growth
Sustained
Growth
is
fundamental to motivating
and measuring our success.
Our quest for sustained
growth
stimulates
innovation, places a value
on results, and helps us
understand whether today's
actions will contribute to
our future. It is about
growth of people and
company performance. It
prioritizes
making
a
difference and getting
things done.

Empowered People
Empowered People means
we have the freedom to act
and think in ways that we
feel will get the job done,
while being consistent with
the processes that ensure
proper governance and
being mindful of the rest of
the company's needs.

Responsibility & Trust

Responsibility and Trust
form the foundation for
healthy growth. It's about
earning the confidence that
other people place in us as
individuals and as a
company.
Our
responsibility means we
take personal and corporate
ownership for all we do, to
be good stewards of the
resources entrusted to us.
We build trust between
ourselves and others by
walking the talk and being
committed to succeeding
together.

BRAND FACTS
PepsiCo nourishes consumers with a range of products from tasty treats to healthy eats
that deliver enjoyment, nutrition, convenience as well as affordability.

BEVERAGES

PepsiCo Indias expansive portfolio includes iconic refreshment beverages Pepsi, 7

UP, Nimbooz, Mirinda and Mountain Dew, in addition to low calorie options such as
Diet Pepsi, hydrating and nutritional beverages such as Aquafina drinking water, isotonic
sports drinks - Gatorade, Tropicana100% fruit juices, and juice based drinks Tropicana
Nectars, Tropicana Twister and Slice. Local brands Lehar Evervess Soda, Dukes
Lemonade and Mangola add to the diverse range of brands.

38

FOODS

PepsiCos food division, Frito-Lay, is the leader in the branded salty snack market
and all Frito Lay products are free of trans-fat and MSG. It manufactures Lays Potato
Chips, Cheetos extruded snacks, Uncle Chipps and traditional snacks under the Kurkure
and Lehar brands. The companys high fibre breakfast cereal, Quaker Oats, and low fat
and roasted snack options enhance the healthful choices available to consumers. Frito
Lays core products, Lays, Kurkure, Uncle Chipps and Cheetos are cooked in Rice Bran
Oil to significantly reduce saturated fats and all of its products contain voluntary
nutritional labeling on their packets.

39

4.4 PRODUCTS
PRODUCT PROFILE

PepsiCo manufactures a variet y of flavors and products in the world. But

in India its major flavors are: Pepsi, Mirinda orange, Mirinda lemon,
Mountain dew, slice, 7up, Nimbooz, Tropicana, Twister, Lehar Everest
soda, Gatorade and Aquafina.
It also introduced flavors like Pepsi blue, Pepsi gold but these majorl y
failed in market.

PRODUCT INGREDIENTS
Pepsi-Cola contains basic ingredients found in most other similar
drinks including carbonated water, high fructose corn syrup , sugar,
colorings, phosphoric acid , caffeine, citric acid , and natural flavors. The
caffeine-free Pepsi -Cola contains the same ingredients minus the
caffeine.

Ingredients

Amount per 100mL

Energy

100.5 kJ

Fat

0g

Sodium

0.98 mg

Carbohydrates

11.74 g

Sugar

11.04 g

Protein

0g

Caffeine

10 mg

The original Pepsi-Cola recipe was available from documents filed with the court at
the time that the Pepsi-Cola Company went bankrupt in 1929. The original formula
contained neither cola nor caffeine.

40

PRODUCT TYPES
BEVERAGES
PEPSI
Brand History
1886, United States of America. Caleb Bradman, the man with a plan, got on to
formulate a blockbuster digestive drink and decided to call it Brads drink. It was this
doctors potion that was to become Pepsi Cola in 1898, and eventually, Pepsi in 1903.

Quick Brand Facts

Flagship Brand of PepsiCo.

100 year old brand loved by over 200 million people worldwide.
An iconic youth brand in India.
The single largest selling soft drink brand in India.

Constituents : Carbonated water, Sugar, Acidit y regulator, Permitted

Natural Color and Flavor Natural Flavoring Substances. Contain no fruit,
Contain Caffeine. Quantit y of sugar added 10 gm/10 0ml.

41

Pricing : `8 300ml glass bottle

`12- 600ml glass bottle
`22- 600ml PET bottle
`32- 1L PET bottle
`60- 2L PET bottle
`18- 350ml My Can
`20- 350ml My Can (Diet Pepsi)

7UP
Brand History
7UP, the refreshing clear drink with natural lemon and lime flavour was created in 1929.
7UP was launched in India in 1990 and its international mascot Fido Dido was used for
advertising in 1992 to position the brand as a cool drink for youngsters. Fido became an
instant hit with his trendy look, laid back attitude and refreshing take on life. During the
brands early years in India, 7UP gained market leader status in the lemon lime category
by being one of the first to be nationally distributed as well as being marketed as a
healthier alternative to other soft drinks.

42

Constituents: Carbonated water, sugar, acidit y regulator and sequestering

agent, Permitted Class II preservatives, Contain added flavor - Natural
flavoring Substances, Quantit y of sugar added - 11gm/100gm,Contain no
fruits.

AQUAFINA
Brand History
Aquafina was first launched in USA in the year 1994 and with its unique
purification system and great taste; Aquafina soon became the bestselling
brand in the country.
In India, Aquafinas journey began with the Bombay launch in 1999
and it was rolled out nationall y by the year 2000. On the strength of its
brand appeal and distribution, Aquafina has become one of India's leading
brands of bottled water in a relativel y short span.

GATORADE
Brand History
Gatorade, Worlds No.1 Sports Drink, was indeed born on the field of
sports! Gatorade was launched in India in 2004 and over the years, has
become an integral part of the kit bags of many top sports people.
Top sports stars and professionals have tried and endorsed Gatorade in
India including Sachin Tendulkar, Irfa n Pathan, Md. Kaif, S. Sreesanth
Ramji Srinivasan and Javagal Srinath.

43

Brand Advantage
Gatorade is an optimal mix of water, carbohydrates and essential mineral
salts that get absorbed instantl y to rehydrate, replenish and refuel like no
other beverage can. Gatorade is unlike any other Beverage or Energy
Drink!
Gatorade quickl y puts back wh at body losses in sweat. It s scientific
formulation instantly helps the body restore essential minerals, salts,
water & energy lost when it is active. Gatorade thus helps go Stronger
for Longer. It contains less than of the sugar that is normall y found in
energy drinks/ soft drinks and even juices.

Quick Brand Facts

Water Helps, Gatorade Transforms.

Gatorade is meant for consumption in active, sport y, hot and
sweat y occasions.
Gatorade is scientificall y formulated and athleticall y proven to
quench thirst.

44

MOUNTAIN DEW
Brand History
The main formula of Mountain Dew was invented in Virginia, named and
first marketed in Johnson Cit y, Tennessee and Knoxville, Tennessee in
1948.
In India, Mountain Dew set the soft drink category ablaze in 2003 with
their iconic launch campaign Cheetah Bhi Peeta Hai.
In 2007, the brand was re-launched with a completely new, punchier formulation with
communication that aimed at forging a strong emotional connect with the audience. Thus
came about the "Darr Ke Aage Jeet Hai" campaign, which acknowledged that fear was a
very real and relevant aspect of the adventurous world and Mountain Dew, as a brand
wanted to encourage all youth in their moment of fear, to believe in themselves and just
go for it because beyond fear, lies victory.

45

NIMBOOZ
Brand History
Nimbooz was launched in India on the 28th of February 2009. Latest
addition to the portfolio of Pepsi Beverages. Indias first nationall y
available packaged Nimbu Pani .

Brand Advantage
The brand delivers very strongl y on certain expectations. These are
Locall y Relevant Taste
Nimbooz is a great tasting product which has capitalized on the
existing familiarit y & behavior of high frequency consumption of
unpackaged / Homemade nimbu pani. I t has been true to its Asli
Indian Identit y by owning and appropriating nimbu pani Codes
such as the Matka (Earthen Pot) and Squeezer.
Convenience and Great Value
The product is available in 3 convenient formats, 350ml PET,
200ml RGB and 200ml Tetra at m agic price points of Rs.15, Rs. 10
and Rs. 10 respectivel y.
Accessibilit y
Nimbooz is Indias first nationall y available packaged Nimbu
Pani.
Hygienic
It is just like home made nimbu pani, so that one can enjoy that
natural and delicious lemony refreshment anywhere you go.

Constituents: Nimbooz, a refreshing nimbu -pani, is a juice -based

beverage made using natural ingredients -purified water, nimbu juice,
sugar, and very commonl y used safe and permitted food ingredients
including a preservative to deliver the same great taste consistentl y
covering best before date provided on labels. The product does not
contain any artificial flavouring substance.
Nimbooz is completel y safe to consume. Health and food experts have
also clarified that drinking N imbooz is safe. PepsiCo uses onl y best
qualit y food ingredients to manufacture all products and Nimbooz is made
in state-of-the-art plants which are HACCP (a global food safet y and
qualit y certification) certified to deliver safe and contamination -free
products. Nimbooz is full y compliant with all the prevailing Food Safet y
Regulations laid down by Government of India.
46

SLICE
Brand History
Slice was launched in India in 1993 as a refreshing mango drink and
quickl y went on to become a leading player in the category.
In 2008, Slice was relaunched with a 'winning' product formulation which
made the consumers fall in love with its taste. With refreshed pack
graphics and clutter breaking advertising, Slice has driven strong appeal
within the category.

TROPICANA
Brand History
Tropicana was founded in Bradenton, Florida, USA, in 1947. And is now
enjoyed almost everywhere in the world. Carefull y nurtured for over 50
years, it has matured into one of the most respected beverage brands.
Today it is the Worl d's no. 1 juice brand and is available in 63 countries.
Since 1998, it has been owned by PepsiCo, Inc. Tropicana Premium Gold
was re-launched as Tropicana 100% in year 2008
Categories in India, Tropicana comes in 2 varieties: 100% Juices (sold as
Tropicana 100%) and Juice beverages & nectars (sold as Tropicana).

47

TROPICANA TWISTER
Brand History
PepsiCo India launched its international fruit drink brand Tropicana
Twister nationall y in India in Jan08. Tropicana Twister comes from the
rich heritage and renowned fruit expertise of Tropicana, the World's No.
1 Juice brand.
Tropicana Twister launc h is a significant entry in a fast changing
beverage industry where there is an increasing trend towards making
healthier beverage choices.
With the launch of Tropicana Twister,
PepsiCo aims to create & capture significant part of the fastest growing
Juice drinks category

48

The brand is targeted at young adults seeking natural refreshment

beverage options that also deliver on attitude or coolness quotient
and on-the-go convenience. Tropicana Twister is available currentl y in
2 exciting flavor va riants Orange Thrill & Apple Burst, each available
in highl y attractive packaging & pricing: 250ml Glass Bottle at `12/ 350ml PET bottle at `22/ - & 1.2L PET bottle at `70/ -

MIRINDA ORANGE
Brand History
Mirinda is an international soft drink brand from Spain that was launched in India in
1991.
Now when we think Mirinda, we think orange. But this soft drink brand has many other
fruit flavours; Mirinda Lemon was launched in 1998 & other flavors like Apple & Bat
berry that were launched as in & outs.
Mirinda has always been about a great orange taste, which is now synonymous with the
brand. These were communicated through our great campaigns; the memorable Mirinda
Men to Taste Aisa Chaye Character Fisla Jaye.

49

Constituents: Carbonated water, Sugar, Acidit y regulator, Sequestering

Agent Emulsifying and Stabilizing agent, Permitted Class II Preservative,
Contain permitted synthetic food color, Added Flavor natural flavoring
substances, Quantit y of sugar added 13gm/100gm, Contain no fruit.

MIRINDA LEMON

Constituents :

Carbonated water, sugar, acidit y Regulator and

Sequestering Agent, emulsifying And Stabilizing Agents, Permitted class
Preservatives, Antioxidants, Contain Added Flavor. Quantity of Sugar
added 10gm/100gm. Contain no fruit.

50

FOODS
CHEETOS
Brand History
Cheetos, a global brand, launched in India in 1995 has been positioned as a brand
which inspires imagination and a sense of adventure and fun.

Brand Advantage

All Cheetos products are made with healthier oil - Rice Bran Oil. This has led to a
reduction in saturated fat by 40% in Cheetos products.
In two of its biggest variants (Masala balls & Cheese Puffs) PepsiCo has reduced
fat by 10% through product improvement initiatives even as it maintains their taste
profiles.
In the third main variant - Tangy Loops, the product has been improved by using
wholegrain in its manufacture.
The new launch under Cheetos Whoosh is a source of Vitamin A.

Chester
Cheetah
is
Cheetos'
brand
mascot.
Chester Cheetah is the "Cool Cat" who accompanies kids in their adventures.
Chester is wild and witty, wears cool sun glasses and is great fun to be with. Most
importantly, Chester Cheetah is crazy for Cheetos.

51

KURKURE
Brand History
Launched in 1999, this perfect 'namkeen' snack, fully developed in India, has become
the torch bearer of fun and lovable human quirks. It developed an even stronger identity
through celebrity associations with Juhi Chawla [2003] and Kareena Kapoor [2008],
well-known actors in Indian Cinema.

Brand Advantage

Cooked in RBO (Rice Bran Oil), Kurkure has 40% less Saturated Fat, Zero Trans
Fats and No Added MSG.
All the raw materials used in Kurkure comply with the Prevention of Food
Adulteration Act and Rules that govern the manufacture, distribution and sale of
Kurkure.
All ingredients are such that are used daily in all households today for preparation
of various edible items.

Kurkure, a Snack SmartTM product, is a new age Namkeen and contains Rice
meal, Corn meal, Gram Meal, Edible oil, Seasonings, Salt, Spices and Condiments
and Flavors (some or all in variants of Kurkure).

52

LAYS
Brand History
Lays - worlds largest and favorite snack food brand, has also steadily established
itself as an indispensable part of the snacking culture in India since its launch in
1995. Lays, with its irresistible tastes, international & Indian flavors and young imagery
has established itself as a youth brand and continues to grow in the hearts and mind of its
consumer!

Brand Advantage
Quality Standards
Lays is made in automated plants in three locations Channo (Punjab), Kolkata and
Pune.
These plants are also audited and certified by various external agencies. These
certifications include:

HACCP (Hazard analysis & critical control point),

Certification by TQCSI (Australia), which confirms that products are
manufactured in Food Safety Environment & manufacturing has adequate controls
to ensure product tracking.
AIB International: one of the best auditing body which confirms process and
product safety.
The plants are ISO 14000 certified which confirms that the manufacturing process
ensure environmental safety.
Our plants are also certified to ensure that the product, process, environment and
people safety have been maintained at very high level and this certification is
issued by OHSAS 18001 (Occupational Health & Safety Assessment Series
USA).

53

LEHAR NAMKEEN
Brand History
Lehar was launched in 1996, Innovated through small packs and new traditional
Flavours. It was built on communication, irresistible taste and modern imagery. Lehar
was re-launched in 2006 and positioned on the plank of "Taste zyaada kyonki oil taza"
with a promise to deliver good taste through the use of fresh oil in manufacturing.

QUAKER OATS
Brand History
PepsiCo had acquired Quaker Oats globally in 2001. Quaker Oats was launched
nationally in India in 2006 and has seen various successes in the last few years.

54

Quaker Oats offer the complete whole grain "package" of complex carbohydrates, fiber,
essential nutrients, and phytonutrients - plant based substances with many health
benefits. Each serve of Quaker oats provide 70% of your daily whole grain requirement
Quaker Oats helps reduce cholesterol and helps weight management

UNCLE CHIPS
Brand History
Launched in 1992, Uncle Chipps was a pioneer in branded potato chips in India.
The brand was acquired from Amrit Agro Ltd. in 2000 by Frito-Lay India. The
extremely popular brand has grown from strength to strength post acquisition with
consumers feeling a very strong connection with it. Uncle Chipps is warm playful, lively,
companionable and traditional-at-heart', just like the Uncle everyone in the family related
to and no family gathering is complete without!

55

ALIVA
Brand History
Aliva was launched on June 5, 2009.
Aliva has an iconic product shape that has even been granted a design registration.

About the Brand

After Kurkure's enormous success, Aliva marks FritoLay India's creation of yet another
category borrowing ingredients & textures from biscuits & flavourful experiences from
namkeens. Aliva is a product range developed in India especially for the Indian
consumer & is a significant step in the companys journey of portfolio transformation
towards providing healthier and tasty snacking options in line with local consumer needs.
Aliva has a range of 4 distinct Indian flavours that have been inspired by local spices
unique to different parts of the country.

56

4.5 CORPORATE SOCIAL RESPONSIBILITY - INDIA

Performance with Purpose articulates PepsiCo Indias belief that its businesses are
intrinsically connected to the community and world that surrounds it. Performance with
Purpose is about delivering more than financial performance, its about saying
committed to continuously giving back to the community and helping enrich society.
PepsiCo India continues to build on its strong foundation of achievements on the
Purpose or CSR agenda and scale up its initiatives while focusing on the following 4
critical areas that are linked to its business and where it can have the most impact.

REPLENISHING WATER
PepsiCo India Holdings Private Limited (herein referred to as PIHPL) had claimed of
Positive Water Balance with its Water Credit being 6004 million liters and Water Debit
being 5168 million liters. On the basis of the methodology adopted and review
conducted by DTTIPL, it could be estimated that PIHPL is Water Positive, by 836
Million Liters, for Jan. 2009 to Dec.2009.

WASTE TO WEALTH
PepsiCos Solid Waste Management Programme
PepsiCo India continues to strengthen its Solid Waste Management initiatives in
partnership with Exnora, an environmental NGO. This award winning, income
generating partnership provides a clean environment to more than 450000 people
across Pammal, Chennai; Nagapattinam, Tenkasi and Cuddalore in Tamil Nadu;
Sangareddy in Andhra Pradesh and Panipat, Haryana.
Unique income generating partnership with leading environmental NGO, Exnora,
a pioneer in waste management.
Community members enjoy the benefits of a clean environment and are educated
on how to recycle waste, not just relocate it. Households segregate their biodegradable waste from their recyclable waste. Bio-degradable waste is then
converted into organic manure through the process of vermi-culture.
Programme recycles 97% of household garbage; this project provides livelihood
to more than 500 community members. Bio-degradable waste is converted into
high quality organic manure through vermi-culture.
Recyclable waste such as PET and plastics, waste paper and tetra packs are
recycled.
Community awareness programme includes door-to-door campaigns and street
plays to motivate people to segregate organic and inorganic garbage at source to
enable recycling.
Every aspect of programme built around Community and Government
participation to help programme evolve into a self sustaining model.

PARTNERSHIP WITH FARMERS

PepsiCo India has partnered with more than 10,000 farmers for the supply of
potatoes.
PepsiCo Indias agri-partnerships with farmers help more than 20,000 farmers
across the country to boost their productivity & income.
57

HEALTHY KIDS
PepsiCo's Get Active & a Good Nutrition and Active Lifestyle Program for
Children -has seen robust growth and implementation.
Designed and supported by the PepsiCo Health & Wellness team, the programs have
been implemented in schools in collaboration with prominent NGOs & Hriday, Swashrit
and the Indian Medical Association.

Get Active programs have a central objective: to raise awareness on the

importance of balanced nutrition and regular physical activity for a healthy lifestyle
among school children.
Starting with a Breakfast Makes Me Smart module in 2008 that emphasized the
importance of healthy breakfast to the My Pyramid module launched in April 2009, Get
Active school programs promote learning nutrition through active engagement.
Get Active believes in combining simplicity and enjoyment. The basic principle is
simple & to establish the fundamentals of Calories In = Calories Out.
The programs have yielded great results Highlights:
2008

Get Active reached 250,000 children across 6 metros and 240 schools in 2008 a significant 150% rise over 100,000 children across 2 metros in 2007

Partnerships with key NGOs and organizations & Swashrit, Hriday Shan and
the Indian Medical Association

Participation in School/Institutions' Fests and Events

Prestigious schools like Modern School, Delhi organized a program to enhance

nutrition awareness and the importance of 'Power Breakfast' among children - a
first for the school. Scottish High School and Rotary Club also organized similar
events.

The Healthy Lifestyle Exhibition gave visibility to 1000 children from Delhi

2009

Get Active reached 300,000 children across 10 cities and 350 schools.

58

AWARDS

PepsiCos Palakkad plant won Golden Peacock National Award for Environment
Management in 2005.

The unique PepsiCo-Exnora initiative in Pammal (Chennai) was awarded the

environmental Golden Peacock Award for Innovation in 2006.

PepsiCo-Exnora waste management programme in Chennai wins Environmental

Golden Peacock Award for Innovation in 2006.

Zero Solid Waste Centre in Pammal was recognized as a model project by

UNICEF in 2007.

PepsiCo- Exnora Waste to Wealth program won the BSE NASSCOM Social and
Corporate Governance Award 2008.

PARTNERS IN CSR
PepsiCo believes that its performance is fundamentally connected to its purpose
agenda which represents the commitment to give back as the company grows. It is a
continuing journey that spans three major areas of focus Human, Environmental and
Talent Sustainability.

TERI - The Energy and Resources Institute

Partner in implementation of watershed management projects in Neelamangala
and Uttaranchal

ADI-Alternative Development Initiative

Partner in Watershed Management Projects in Kerala, Punjab and Maharashtra

Exnora International
Partner in Waste to Wealth Programmes

CAP Foundation
Partner in training and provide alternate livelihood options for Tsunami affected
communities in Andhra Pradesh and Tamil Nadu.

Project Healing Touch

Partner in Mission Vijay II: Programme to provide ex-servicemen with
sustainable livelihoods

Swashrit Society
Partner in Get Active programmes, to promote active and healthy lifestyles
among kids

Youthreach India
Partner in People with Purpose programme

International Labor Organisation

Partner in creating and implementing its HIV/AIDS Workplace Policy
59

RECENT MILESTONES
03 Jun 10
18 May 10
09 May 10
06 May 10
04 May 10
22 Apr 10
09 Apr 10
25 Mar 10
03 Mar 10
03 Mar 10
22 Feb 10
28 Jan 10
23 Jan 10
28 Oct 09
19 Dec 09
19 Dec 09
02 Dec 09
02 Dec 09
22 Sep 08
22 Sep 08
22 Sep 08
22 Sep 08
22 Sep 08
25 Aug 08
28 Jun 08

7UP launches first-of-its-kind digital campaign in AP

7UP'S mega campaign brings loads of goodies for consumers in West Bengal
Nimbooz's "Pecha Bhangre Da" Winners are from Nachda Punjab Cutural
Society & Mohindra College
Gautham Mukkavilli to head PepsiCos Global COE on Grain Nutrition
Lays launches four consumer co-created flavours-an India first !
Mountain Dew dons new look with grip pack
Tatas & PepsiCo sign MOU to form JV for healthy beverages
PepsiCo India achieves splendid success in contact farming in West Bengal
PepsiCo WOWs youngsters with its new thematic campaign 'Youngistaan ka
WOW'
Mountain Dew Teams Up With Kings XI Punjab
Slice launches in Mumbai to bring Pure Mango Pleasure to Indias Mango
Capital.
A burst of lemon refreshment-7UPs new campaign for 2010
Mirinda launches 'Home pack'
Lays launches mega consumer engagement program
Talent Hunt for fast bowlers
Gatorade Launches Pace Bowling Hunt
More products launch under Kurkure and Cheetos
PepsiCo to transform snacks: cut fat, add more nutrients
PepsiCo slots $500 mn to triple India sales
PepsiCo to invest $500 mn; vows to replenish water
PepsiCo working on nutritious products for women
PepsiCo commits $500m aims to triple business
PepsiCo to invest $500 mn in India over three years
Indra Nooyi, Warren Buffett in top 'executive icons' list
Direct Seeding: PepsiCo to cover 1,000 acres

60

CHAPTER-5

VARUN BEVERAGES

61

PEPSICO (VARUN BEVERAGES)

Company Project Studies has been done under Varun beverages ltd.
The company was incorporated in 1995 and is based in Gurgaon, India. Varun Beverages
Limited operates as a subsidiary of RKJ group. The company has 18 bottling plants in
India. Varun Beverages Jaipur started in June 1995.

About R.K.J Group

It can be said with absolute certaint y that the RKJ Group has carved out a
special niche for itself.
Its 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 geographicall y pre -defined territories in which brand and technical
support was provided by the Principals viz., Pepsi Foods Limited. The
manufacturing facilities were restricted at Jaipur Plant onl y.
Varun Beverages Ltd. is the flagship company of the group. It is a
bottling plant of the R.K.J. group which is located in Bhiwadi, Jaipur
(Rajasthan).

62

R.K.J. GROUP

BOTTLING

Varun Beverages
ltd.
Devyani Beverages
ltd. etc.

FOOD
CHAIN

Pizza hut
K.F.C.

EDUCATION

Delhi Public School

M.M.S

The group also became the first franchisee for Yum Restaurants
International [formerl y PepsiCo Restaurants (India) Private Limited] in
India. It has exclusive franchise rights for Northern & Eastern India. It
has total 46 Pizza Hut Restaurants & 1 KFC Restaurant under its
company.
It has diversified into education by opening the first school in
Gurgaon under management of Delhi Public School Societ y.
The schools of the group are run under a Registered Trust namel y
Champa Devi Jaipuria Charitable Trust.
Companies are medium sized, professionall y managed, unlisted and
closel y held between Indian Promoters and foreign collaborators.

63

THE AUTOMATED BOTTLING PROCESS

WATER +
CARBON DI OXIDE
+
SECRET FORMULA
+ SWEETNER

WASHING OF
BOTTLES

FILLING

CAPPING

LABELLING

CODING
INSPECTION

WAREHOUSE

PACKAGING

64

AWARDS & RECOGNITION

Awards feather in the cap -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 PepsiCos 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.
The RKJ group led by Mr. Jaipuria has seven Pepsi bottling plants.
Spread around the country in Greater Noida and Kosi (UP), Alwar and
Jodhpur (Rajasthan), Goa, Dharwar (Karnataka) and Kathmandu.
It has mainl y 5 departments, these are:
1.
2.
3.
4.
5.

Shipping Department
Production Department
HR Department
Finance Department
Sales and Marketing Depart ment

FUTURE PLANS
In two months time, the South African country Zambia will have another
beverage company added to the limited plants existing in the country. The Pepsi-Cola
plant in Lusaka whose construction begun in September last year under the franchise of
Varun Beverages a subsidiary RJ Corporation of India, is expected to open in the first
week of August.
Key Points
Creation of 300 immediate jobs for Zambians.
16 people earmarked for technical positions already in India under the auspices of
the company, for orientation in beverage technology.
First phase Varun Beverages-Zambia to be located in the vicinity of Zambia
Breweries with a capital injection of US$20 million, will give a number of
management positions to Zambians. Apart from Pepsi and water-packaging, a
range of fresh-fruit juices will also be processed.
Second phase Expansion into the Copperbelt in the next two years, at an
estimated cost of US$15 million.

65

Mr Ravi Jaipuria extolled Zambias investment policies and stable political climate
coupled with friendly people, as variables that attracted his company to invest in the
country. Zambia is a very peaceful country and because of its centrality it is easy to tap
into the market in neighbouring countries, this would also help marketing the country to
other investors.
Varun Beverages chairperson Ravi Jaipuria has pledged commitment to ensuring good
conditions of service for workers. A strong commitment to corporate-social
responsibility and the environment has also been made. Diplomats at the Zambia High
Commission in New Delhi recently visited the headquarters of Varun Beverages on the
outskirts of the capital, to acquaint themselves with operations of the company whose
chain of other businesses include Pizza Hut, Costa Coffee and Kentucky Fried Chicken,
popularly known as KFC, among others. Zambian business executives and
representatives from the Zambia Development Agency (ZDA) networked with the Indian
business community under the theme India-Africa Project Partnership.

The company which will add to the core Pepsi-product, fruit juice processing, will also
expand to the Copperbelt in the next two years. The expansion programme will gobble
US$15million. Plans are also afoot to explore viability of the beverage industry in far
flung and remotes parts of the country. This will however, be dictated by the supply
chain of raw materials and their availability. This is to ensure sustainable production.
The company will also consider diversifying into agriculture and dairy industry. When
this happens, out-grower schemes will be an added. This will trigger farmer-motivation
and increased productivity with one end result-more income for peasant farmers.

66

CHAPTER-6

MARKETING STRUCTURE
ORGATIONAL HIERARCHY

67

7.1 MARKETING STRUCTURE:

DISTRIBUTION NETWORK OF PEPSICO
PepsiCos products are brought to market through DSD, customer warehouse and
foodservice and vending distribution networks. The distribution system used depends on
customer needs, product characteristics and local trade practices.

Direct-store-Delivery
PepsiCo, its bottlers and its distributors operate DSD systems that deliver snacks and
beverages directly to retail stores where the products are merchandised by its employees
or its bottlers. DSD enables PepsiCo to merchandise with maximum visibility and
appeal. DSD is especially well-suited to products that are restocked often and respond to
in-store promotion and merchandising.

Customer warehouse
Some of PepsiCos products are delivered from its manufacturing plants and warehouses
to customer warehouses and retail stores. These less costly systems generally work best
for products that are less fragile and perishable, have lower turnover, and are less likely
to be impulse purchases.

Food service and Vending

PepsiCos foodservice and vending sales force distributes snacks, foods and beverages to
third-party foodservice and vending distributors and operators. PepsiCos foodservice
and vending sales force also distributes certain beverages through its bottlers. This
distribution system supplies our products to restaurants, businesses, schools, stadiums
and similar locations.

COMPETITION
PepsiCos businesses operate in highly competitive markets. It competes against global,
regional, local and private label manufacturers on the basis of price, quality, product
variety and distribution.
PepsiCos snack brands hold significant leadership positions in the snack industry
worldwide. PepsiCos snack brands face local, regional and private label competitors, as
well as national and global snack competitors, and compete on the basis of price, quality,
product variety and distribution. Success in this competitive environment is dependent
on effective promotion of existing products, the introduction of new products and the
effectiveness of its advertising campaigns, marketing programs and product packaging.
PepsiCo believe that the strength of its brands, innovation and marketing, coupled with
the quality of its products and flexibility of its distribution network, allow it to compete
effectively.

68

7.2 ORGANIZATIONAL HIERARCHY (MARKETING)

Unit Manager

Territory Development
Manager

Marketing Development
Manager

Assistant Sales and Development

Manager

Marketing Development
Coordinator

Customer Executives

Pre Sales Representatives

69

CHAPTER-7
GOLD CLUB SCHEME: TERMS RELATED
SALIENT FEATURES
MERCHANDIZING EQUIPMENTS

70

6.1 Terms Related to Gold Club Scheme

Visi Size: - Visi are the fridge with front glass door, provided by Pepsi to the retailers.
There are mainly four types of visis in PepsiCo 220,340,400, 650 liters. But in some
outlet they are having 160, 1192 liters visi size.

Visi Purity: - It means how much a visi is pure. If a visi has only PepsiCo products it
known as pure visi or if a visi has milk, juices, butter or other companys product like
coca-cola, Thums up it will be known as impure visi. In this Column we fill YES or NO
options.

Visi & Rack Charging: - This means the

number of flavors that a Pepsi

retailer must keep in the instruments like Visicoolers, gravit y racks etc.
provided to him. For example a visi is having only 2 bottles of Pepsi and 1 bottle of
Mirinda, in this case visi is not charged full. In other hand a visi is full charged with its
product then it will come under charged visi. We mention this detail by percentage basis
through observation method like 45%, 70% or 90% etc. The same is also applicable for
racks and hangers.

Visi POG: - It stands visi cooler Plano gram. According to companys norms a visi
should have drinks kept in a certain sequence. This sequence is different according to
various visi sizes. For example in 220 liters size visi has 3 shelves;
In first shelf retailers should keep 1 row Pepsi My Can, 4 rows of Pepsi (300ml.), 1
row of 7up (300ml.) and at last row for Mirinda (300ml.)
In second shelf they should keep 2 row of Mirinda (300ml.), 2 row of Mountain Dew
(300ml.), and 3 row of Slice (300ml.)
And in third shelf retailers should 2 row of Pepsi (500ml.), 1 row of Mirinda
(500ml.), 1 row of Mountain dew (500ml.), 1 row of Pepsi (2 liters)

Rack purity: - The retailers have to fill all the equipments purel y with
Pepsi drinks. No brand othe r than Pepsi is allowed to be placed in them.
If a retailer keeps onl y Pepsi brands or flavors in them, then it is called
as 100% pure.

No. of SKU available: - It is the number of brands of PepsiCo a retailer is having.

For example Pepsi 200ml. & 300ml. Pepsi My Can, Mirinda 200ml. & 2litres, Tropicana
(Mango, Apple, Mix fruit), it means there are 08 SKU available.

71

RETAILER SURVEY
In this survey dealer/retailer who is selling PEPSI DRINKS has been
asked a set of questions based on certain crit eria like:
1. Awareness amongst the retailers about the scheme, further interests
in the scheme and problems faced during the scheme.
2. The knowledge about enrollment criteria & general guidelines of
the scheme.
3. Proper arrangement of the display ad (merchan dising) of PEPSI like
display boards, flex, various t ypes of racks, VIS I coolers, sitting
arrangements like TABLE & CHAIR set, UMBRELLA, wall
paintings of the brands, air hangers, in shop display of the product,
etc. and problems related to it ,if faced by the retailer.
4. Chilling details (VISI number of both PEPSI & COKE, requirement
of a different size of it, arrangements of drinks according to
planogram and problem faced in the same, if any).
5. Stock or the number PEPSI and COKE carats and number of bottles
available at the shop.
6. The suppl y of PEPSI, whether the supply is reaching on time or
not. Also the frequency of suppl y (according to retailers order).
7. Checking the go to market system of PEPSI i.e. checking whether
the sale of PEPSI is DIRECT ( through distributor), or INDIRECT
(through sub-distributor, or whole seller, or any spoke person, and
also checking whether the sale is a PRE SELL or a READY STOCK
SALE).
8. Reasons for any difficult y in target achievement during the scheme,
why retailers ke eps drinks other than Pepsi Brands and why the
sales increase during the scheme period.
9. The t ype of channels (among grocery, convenience or eatery) that
shop is having.
10.Types of Pepsi Brands available more during the scheme.
11.The benefits of COKES sch eme over that of PEPSI and which
brand has more sales.
12.Changes desired by the retailers in the scheme.

72

6.2 SALIENT FEATURES OF THE SCHEME

The GOLD C LUB SCHEME acts as a marketing strategy of the
company to attract retailers (involved in bulk purchases) and thereby
increase its product demand and sales. The duration of this scheme is
from 1 s t April to 30 t h June.
Under this scheme; PepsiCo pro vides Visi coolers, Gravit y racks, Visi
Tops and Air hangers to the retailers. Retailers have to place these
equipments in their respective shops. With it they have to fulfill certain
conditions:

1.

Buy 1 C/S RGB + CASE 600ML PET + 1 CASE NIMBOOZ. A free

enrollment gift given with it (Ajanta wall clock).

2.

Visi & Rack 100% Pure and 80% Charged, Pepsi Warm Stock Higher
than Competition, Minimum availability of 18 SKUs in the outlet
(Aquafina & Nimbooz availabilit y is mandatory).

3.

Volume or targets are given to the retailers .The retailer have to

achieve certain level of sales. They are given points according to that
in the proceeding

4.

Retailers are evaluated on this basis and marks are given out of 100
for purit y of Pepsi equipments, % charge and fulfillment of
Pepsi
sales target.

5.

Rewards given to selected outlets on the basis of evaluation.

THE POINT STRUCTURE:

S. No.
1
2
3
4

Instruments
VISICOOLER
100% pure,90% charge
RACKS
(gravit y, P.V.C.s )
TARGET VOLUME
(Sales Target)
S.K.U.
(stock keeping units)
TOTAL

Points
40
20
20
20
100

Evaluation is done for 3 months i.e. 1 s t April 30 t h June. The retailers

who were part of the scheme and who score more than 220 mark s at the
end of 3 months are provided gifts by PEPSICO.

73

6.3 MERCHANDISING EQUIPMENTS

Some of the merchandising equipments that are used by PEPSI as its
marketing strategy and which the surveyor has to check at every dealer
while surveying are -:

1) VISICOOLERS
These are refrigerators given
by the company to the retailers so
that they can keep the products of
the company, Cool and fresh. A visi
has two, three or four racks
according to its size.
It
is
basicall y
a
merchandising technique adopted by
company. There is an agreement for
the same and they can also change
the Visicoolers if it is not working
well.
All
maintenances
are
responsibilit y of company, but
damages if any are paid by the
retailers.
A V is ico o ler d i sp la y i ng v a rio us fla v o rs o f co mpa ny

2) GRAVITY RACKS
These are basicall y
racks which are made
up of wrought iron. In
this the bottles are
made to hang through
their
caps.
The
advantage
of
these
racks are that it can be
easil y moved in or out
of the shop and no
maintainance
and
repairs are required.

A gravity rack showing

various flavors
74

3) AIR HANGERS
These are also merchandising instrument which is used to display the
products.

4) P.V.C. RACKS
P.V.C. stands for pol y vinyl chloride .this is name of material of
which the rack is made up of. Usuall y, these are said called plastic
racks

5) H/W or HIGHWAY RACK

It is a kind of rack which is made of iron and is used to display PEPS I
at highways.

6) BANNERS & FLEX

These are used for displaying advertising PEPSI it is either made up of
FLEX cloth or paper.

7) UMBRELLA, TABLE & CHAIR SET

This is another mode of display used for attracting customers these are
usuall y seen at eatery shops.

8) WALL PAINTING
This is another mean of display which is done inside the retail outlet.
In this the outlet walls are painted with the ad of PEPS I. These are
also usuall y found in eateries like highway dhabas, restaurants,
sweet shops etc.

9) DEALER BOARDS (DPS) & GLOW SIGN BOARDS

These are display boards that are used to attract retailers and also the
customers. These are big hoardings found hanging at the retail o utlet
with the AD of PEPSI and retail shops name written on it. A simple
one is DPS while a one in which the board is highlighted with lights is
known as GLOW S IGN BOARD.
ABOUT DEALERS OR RETAILERS
All the retailers are classified into three channels: These are:
1. CONVENIENCE
2. EATERY/RESTAURANT
3. GROCERY
1. Convenience includes shop where
there is no facilit y of sitting but a
customer has to eat or drink in
standing position onl y e.g. all
bakery shops, confectionaries,
Paan shops, Petha shops, Saras
dairies, sweet shops(with no
sitting arrangement), Chai thadis
etc
75

2. Eatery includes outlets where

there is sitting facilit y for the
customer to eat or drink e.g. all
the hotels, restaurants, hang out
places. It also includes dhabas,
juice shops etc.

3. Grocery shops include

all the shops where
household items like
sugar, salt etc. are sold.

There are about 750 outlets of the convenience, eatery and grocery
under Gold Club Scheme in Jaipur market.

76

CHAPTER-8
LITERATURE REVIEW: MARKETING
RETAILER BEHAVIOUR

77

8.1 LITERATURE REVIEW: MARKETING STRATEGY

MARKETING
Marketing is a societal process by which individuals and groups obtain what they
need and want through creating, offering and freely exchanging products and services of
value with others or otherwise it is the process of planning and executing the conception,
pricing, promotion and distribution of ideas, goods, services to create exchanges that
satisfy individual and organizational goals.

MARKETINGS TRATEGY
Marketing strategy is a set of objectives, policies and rules that leads the company's
marketing efforts. It is the marketing approach to accomplish the bread objective of the
marketing plan. The various purpose of marketing strategy is as follows:
1. Selecting largest markets segmentation
2. Positioning
3. Product
4. Price
5. Place
6. Promotion
7. Research and development

1. Market segmentation and selecting target market

It is an effort to increase a company's precision marketing. The starting point of any
segmentation discussion is mass marketing. In mass marketing, the seller engaged in the
mass production, mass distribution and mass promotion of one product for all buyers.
Market segment consists of a large identifiable group within a market with similar wants,
purchasing power geographical location, buying attitudes or buying habits. It is an
approach midway between mass marketing and individual marketing. Through this the
choice of distribution channels and communication channels become much easier. The
market segments may be formed by looking at retailer characteristics; geographic,
demographic, and psychographic. After segmenting the market, the target market
selected.

2. Positioning
The positioning is a creative exercise do with an existing product. The well known
products generally hold a distinctive position in retailer's minds. The positioning requires
that every tangible aspect of product, price, place and promotion must support the chosen
positioning strategy. Company should develop a unique selling proposition (USP) for
each brand and stick to it. As companies increase the number of claims for their brand,
they risk disbelief and a loss of clear positioning. In general a company must avoid four
major positioning errors. Those are under positioning, over positioning, confused
positioning and doubtful positioning.

78

3. Product
A product is any offering that can satisfy a need or want. The major types of basic
offerings are goods, services, experiences, events, places, properties, organizations,
information and ideas. The company gives more importance in quality, packaging,
services etc. to satisfy the customers. The products have their life cycle. The product
strategies are modified in different stages of product life cycle.

4. Price
It is the most important aspect in company's point of view. Price of the product will
be decided by the company according to the competitor's price.

5. Place
This plays a major role in the entire marketing system. The company emphasizes on
its distribution network. Proper distribution network gives proper availability of the
product.

6. Promotion
Promotion is the one of the major aspects in marketing strategies. By adopting
various promotional activities the company create strong brand image. It also helps in
increasing the brand awareness. It includes advertising, sales promotions and public
relations etc.

7. Research and Development:

After testing, the new product manager must develop a preliminary marketing
strategy plan for introducing the new product in to the market. The plan consists of three
parts. The first part describes the target market's size, structure and behavior. The second
part outlines the planned price, distribution strategy and marketing budget for the first
year. The third part of the development describes the long run sales and profit goals and
marketing mix strategy over time.

79

PEPSICO products are usually targeted towards youth. However segmentation can
be done on the basis of preferences of individuals at various stages of their life
cycle , income level and situation as per requirement as follows:

On the basis of various stages of life cycle:

1. Growing children PEPSICO glucose is there for nourishing young minds.
2. Health conscious people

On the basis of income level:

1. Rural population:
Being a low income group, the smaller packaging is the most preferred choice, as it is
at affordable price.
2. Urban & Semi-Urban Population
Such a population is usually having a variety seeking behavior so instead of going for
the usual products available. They prefer something different since money is never a
limitation for such a class. Brands specifically catering to such a population are:
Diet Pepsi
Gatorade Energy Drink
Tropicana Juice

8.2 RETAILER BUYING BEHAVIOR

Understanding the buying behavior of the target market is the essential task of
marketing management under marketing concept. The retailer market consists of all the
individuals and households who buy or acquire good and services for personal
consumptions. The buying behavior tries to find out the answers for the questions, who
buys? How do they buy? Where do they buy? Do they buy?

(A)FACTORS INFLUENCING RETAILER BUYING BEHAVIOR

There are four major factors that influence the buying behavior such as cultural
factors, social factors, personal factors, and psychological factors.
1. CULTURAL FACTORS: Culture is the most fundamental determinant of a
person wants and behavior. Values, perceptions, preferences, and behavior are the
main variable under culture of an individual. Each culture contains sub-culture
like nationality, religious group, geographical area, and linguistic divisions etc.
2. SOCIAL FACTORS: A retailer behavior is also influenced by social factors
such as the retailer reference group family and social roles and status.
3. PERSONAL FACTORS: A buyer decision is also influenced by his or personal
characteristics, notably the buyers age, lifestyle, occupation, economic
circumstances etc.
4. PSYCHOLOGICAL FACTORS: A person buying choice is also influenced by
four major psychological factors such as motivation, perception, learning belief
and attitudes.

80

(B) BUYING DECISION PROCESS

It includes buying roles, types of buying and steps in buying process.
I.BUYING ROLE
The buying role could be classified into four parts. These are initiator, influencer,
decider and buyer.
II. TYPES OF BUYING BEHAVIOR
Retailer decision taking varies with the type of buying decision. The buying
behaviors are Complex buying behavior, Habitual buying behavior, Variety seeking
buying behavior.
III. STAGES IN BUYING DECISION PROCESS
Here are five stages in buying decision process namely problem recognition search,
evaluation of alternatives purchase decision and past purchase behavior.
1. NEED RECOGNITION
The buying process starts with the buyers recognition of a problem of need. The
buyer senses a difference between his actual state and desired state.
2. INFORMATION SEARCH
There are different sources from where a retailer can gather information like
personal sources commercial sources, experimental sources.
3. EVALUATION OF ALTERNATIVES
After gathering information about different products the customer will be in a
fuss as to choose which product among the mainly alternatives. Retailers usually
evaluate the alternatives on traditional basis, on the basis of utility function etc.
From the many alternative retailers at last choose the best one for him.
4. PURCHASE DECISION
A retailer who decides to execute purchase intention will be making up to five
purchase decisions.
5. POST PURCHASE BEHAVIOR
After purchasing the product and services the retailer will experience some level
of satisfaction or dissatisfaction with the product and services that will influence
subsequent behavior. If retailer is satisfied he may show the probability of buying
the product the next time, satisfied customer will say good thing about the
product, proving the statement that "satisfied customer is the best advertisement.
An unsatisfied customer may take some action against it. They may try to reduce
the dissonance by abandoning returning the product.
Understanding retailer needs and buying process is the foundation of any
company. By understanding how buyers go through problem recognition,
Information search evaluation of alternatives, the purchase decision and post
purchase behavior; marketers can pick up many clues as to how to meet buyers
need.

81

CHAPTER-9
RESEARCH METHODOLOGY

82

SURVEY OF RETAILERS
TO KNOW THE EFFECTIVENESS OF
THE PROMOTIONAL ACTIVITY OF PEPSICO
The project was started under the guidance of the A rea Development
Coordinator of Varun Beverages Limited (PEPSICO) JAIPUR. The
Research study has been conducted at Jaipur covering the retailers under the distributor
of Varun Beverages Limited (PepsiCo) Gudiya Associates located in Adarsh Nagar
Initiall y the basic product and variants of PEPSI was told. The market
was then scanned.

9.1 OBJECTIVES OF THE STUDY

To evaluate the market position of Pepsi drinks.
To carry survey of dealer/retailer in the area allotted.
To check the display (merchandising) of PEPSI like, various t ypes
of racks, VISI coolers .
To get chilling details (VIS I size, requirement of a different size of
it, arrangements of drinks according to planogram and prob lem
faced in the same, if any).
To check the stock or the number PEPSI drinks or its variants available at that
shop.
To know the suppl y of P EPS I, whether the suppl y is r eaching on
time or not.
Checking the go to market system of PEPSI i.e. checking whether
the sale of PEPSI is DIRECT (through distributor), or INDIRECT
(through sub-distributor, or whole seller, or any spoke person, and
also checking whether the sale is a PRE SELL or a READY STOCK
SALE).
The t ype of channels that shop is under (grocery, convenience or
eatery).
To check whether the dealer or retailer is a gold club member or
not.
Closely analysis different problems faced by retailers of PEPSICO in distribution
and other major aspects.
To find out the impact of advertising and sales promotion .
To analyze penetration of PEPSICO in the selected areas.
To explore retailer point of view in terms of availabilit y, taste and
packaging of PEPS ICO drinks in different areas of Jaipur.
83

DURATION OF THE PROJECT

The study was carried out by the researcher in Jaipur cit y. It was
conducted for the period of 1 s t May to 30 t h June 2010.

9.2 SCOPE OF THE STUDY

The scope of the study is limited solely to the markets and retailers visited by the
researcher for the purpose of research; this may hence not be a total reflection of the
coverage, brand representation, awareness, consumption pattern and sales of PEPSICO
products for all the retail outlets and in Jaipur.
The scope of the project is also limited to the retailer perception regarding the brands
of PEPSICO in the selected areas of Jaipur and it doesnt include other competitors. The
study has limited exposure to the market due to time, mobility and financial constraints.
The study would help the company anal yze the awareness amongst the
retailers about the Gold Club Scheme of PepsiCo and position of its
drinks in the market. This would help the company in evaluation of its
promotional schemes and anal yzing the products market position
compared to its rival company.

9.4 LIMITATIONS OF THE STUDY

Every study has some or the other limitation associated with it .The limitations of the
research were as follows:
1. Study confined to selected areas of Jaipur city only.
2. As the nature of research was exploratory so it was difficult to cover each and
every retailer. Thus, the Researchers took a sample of 100 retailers.
3. Limited access to past trend of retailers.
4. Many retailers didnt express their original perception and views because of
biasness.
5. Lack of proper experience on the part of the researcher in conducting such
studies in the past.
6. Some of the retailers were not comfortable in giving fair feedback for the
company.
7. It was not an easy task as there is need of internal information about the
concerned outlet and a strong relationship building with appropriate person of
the outlet.
8. Limited access to important databases.
9. Information regarding SKUs, brand types, available stock, supply and sales
was difficult to observe because they are dynamic in nature.
10. It was an enigmatic task to collect the appropriate data to selective retailers
because I didnt had proper address of outlets.
11. Reliability of data provided in various databases.

84

9.4 RESEARCH PROCESS

IDENTIFICATION OF RESEARCH

RESEARCH DESIGN PLANNING

RESEARCH METHOD SELECTION

SAMPLING PROCEDURE SELECTION

DATA COLLECTION

DATA EVALUATION

ANALYSIS & INTERPRETATION

REPORT WRITING

85

RESEARCH DESIGN
A Research design specifies the methods and procedures for conducting a particular
study. It is a map (or) blue print to which the research is to be conducted.
The research design will give a clear cut idea of the procedure to be followed for the
completion of the project. The research has been carried out with certain focused
objectives which need to be fulfilled after the completion of the study. The completion of
these objectives will throw some light on the problem. The problem at hand is to study
brand representation, coverage, sales and retailer perception towards PEPSICO and other
brands in the market.
EXPLORATORY research design has been considered as a suitable methodology
for present study and for data analysis.

POPULATION
Total population considered 450 Retailers
Confidence Level 95%
Margin of Error 8.7%
Sample Size 100
All types of retail outlets that stock and sell PEPSICO AND OTHER MAJOR
BEVERAGE BRANDS in the markets. The outlets have been classified into as follows:
Convenience stores: All kinds of shops including bakeries.
Eateries: all kinds of eating joints.
Groceries: all shops selling groceries.

RESEARCH METHOD
Survey Method was used to collect data in this research

SAMPLING PROCEDURE
Convenience Sampling (Non-Probability Sampling) was utilized as the sampling
procedure. The researcher had to select the retailers of their convenience. The
Researcher went to different locations and surveyed all shops that could possibly be
approached.

SAMPLE SIZE
Total sample size was 100 respondents, which were interviewed and a
store audit for Pepsi products & Pepsi merchandises was done in the
Jaipur cit y where Varun beverages distribution network is scattered.

SOURCES OF DATA
The sources of data were the retailers of PEPSI

86

Primary Data:
The data collected was primary in nature by survey & observation
method. The primary data are those, which are, collected a fresh and for
the first time and this happen to be original in character.

Collection of data through Questionn aire

Questionnaire consisted of open and close ended questions was used to
collect data th rough personal interview method. The Researcher collected
primary data during the course of research period with the help of Questionnaires that
were designed to infer upon the present status of coverage, brand representation and
awareness among retailers of PepsiCo and other competitor in the region and to gauge
the pulse of the market and retailer.

Places of data collection

The study was conducted in the retail outlets in Jaipur in the following areas:

JHALANA
C-SCHEME
LAL KOTHI
RAJA PARK
JANTA STORE
ADARSH NAGAR
JAWAHAR NAGAR
MOTI DUNGRI ROAD

Random sampling was done for interview of the respondents in above

mentioned areas.

Secondary data:
These were mainl y collected from internet, books, brochures , relevant
literature, and newspapers .

ORGANIZING & EVALUATING THE DATA

The figures obtained during the study are meaningless unless
presented in a proper manner to make them useful in decision mak ing.
The data after collection has to be processed and evaluated in accordance
with the outline laid for the purpose at the time of developing the
research plan. The data obtained is noted in excel, edited and classified to
make it understandable.

ANALYSIS TECHNIQUE
Qualitative analysis is performed using the data collected at each outlet and by each
consumer. The data analysis is to be done and the results are to be critically analyzed and
every aspect of the objectives to be dealt with great detail. The findings are to be
reported with the help of suitable charts and diagrams where ever required.
87

TOOLS OF ANALYSIS
Pie charts, bar charts were used as tools for anal yzing the data .

PRESENTATION OF THE DATA

After the data has been properl y organized, it is ready for
presentation. It includes pie charts, diagrams etc. The main purpose is to
put the data into readable form.

88

CHARTER-10
DATA ANALYSIS
INTERPRETATION
FINDINGS

89

10.1 DATA ANALYSIS

SCHEME AWARENESS

UNAWARE
88%

AWARE
12%

ENROLLED (OUT OF AWARE)

UNENROLLED
33%

ENROLLED
67%

90

SCHEME ACCEPTANCE

INTERESTED
36%

UNINTERESTED
64%

VISI PRESENCE

ABSENT
38%

PRESENT
62%

91

SATISFACTION WITH VISI'S SIZE (OUT OF PRESENT)

UNSATISFIED
32%

SATISFIED
68%

VISI POG AWARENESS (OUT OF PRESENT)

UNAWARE
42%

AWARE
58%

92

FOLLOWING OF PLANOGRAM (OUT OF AWARE)

DO NOT
FOLLOW
AT ALL
58%

FOLLOW
REGULARLY
25%

FOLLOW
IRREGULARLY
17%

SALES INCREASE THROUGH POG (OUT OF AWARE)

DID NOT HELP

36%

HELPED
6%
AVOID TO
FOLLOW
58%

93

BRAND AVAILIBILITY

PEPSI+OTHER
BRANDS
88%

ONLY PEPSI
12%

SKU AVAILABILITY
70%

61%

60%
50%
19%

40%
30%

14%

6%

20%
10%
0%
0-7
7-12
12-19
19 OR ABOVE

94

BRAND TYPES AVAILIBILITY

34%
32%

35%

24%

30%
25%
20%
15%
10%
10%
5%
0%
1-5
5-10
10-15

15 0R ABOVE

BRANDS KEPT MOST

2%

1%
1%
2%
5%
21%
PEPSI 300 ML
PEPSI 600 ML

15%

PEPSI 2 L
MIRINDA 600 ML
MIRINDA 2 ML
NIMBOOZ 350 ML

SLICE 500 ML
7UP 600ML

53%

95

REASONS FOR BRAND KEPT MOST

1%
1%
HIGHER MARKET
DEMAND

21%

BETTER OFFERS

BETTER SERVICE

77%

SUPPLY OF OTHER
COMPANY BRANDS
ABSENT

REASONS TO KEEP OTHER BRANDS

1%
1%
3%
3%

CONSUMER DEMAND
MORE MARKET
DENMAND
MORE COMMISSION

12%
40%

KEEPS ONLY PEPSI

PEPSI DIDN'T PROVIDE
VISI
TIMELY AVAILIBILITY

20%

20%

BETTER SERVICES OF
COCA-COLA
MORE GIFTS GIVEN BY
COCA-COLA

96

REASONS FOR INCREASE IN SALES DURING THE

SCHEME
2%
4%

1%
1%
1%

PROMOTIONAL
ACTIVITIES
DO NOT MATTER

10%

ADVERTISEMENT IN
THE MEDIA
HOT WEATHER
47%

15%

BETTER TASTE &

GOOD MARGIN
PURITY OF DRINKS &
GOOD SERVICES
BETTER QUALITY
GOOD BRAND NAME

19%

TIMELY AVAILABLE

COMPARITIVE SALES OF PEPSI

SLIGHTLY
LOWER
19%

MUCH
LOWER
3%

SLIGHTLY
HIGHER
24%
MUCH HIGHER
54%

97

AVAILIBILITY ON DEMAND

84%

NOT AVAILABLE

1%
ALWAYS
SOMETIMES
15%

SUPPLY

TIMELY
94%

DELAYED
6%

\\

98

SUPPLY FREQUENCY (IN A WEEK)

2%
11%

34%

6-7 DAYS
3-6 DAYS
1-3 DAYS

VERY LOW

53%

COMPARITIVE SCHEME' BENEFITS

COCACOLA
5%
EQUAL
12%

PEPSI
83%

99

DIFFICULTIES IN TARGET ACHIEVEMENT

5% 4%

1%
1%

LOW MARKET
DEMAND
COMPETITION
SODA SHOP NEARBY
LESS STOCK IRREGULAR SUPPLY
NO PROBLEM

89%

100

10.2 INTERPRETATION
1. Out of the total retailers surveyed, most of them i.e. 88% were unaware of the
Gold Club Scheme of PepsiCo.
2. Out of the retailers who were aware of the scheme, only 67% were enrolled in the
scheme.
3. Only 36% retailers were willing to endorse the scheme next season, most of them
(64%) were not interested in the scheme and/or denied to take the scheme next
season also.
4. Out of the total retailers surveyed, only 62% were having the Visi of Pepsi and
there was no Visi cooler on 38% of the outlets.
5. In the outlets with Visi coolers, only 68% were satisfied with its size and the rest
were unsatisfied with it.
6. In the outlets with Visi coolers, only 58% of retailers were aware of the
Planogram.
7. Out of the retailers aware of the Planogram most of them (58%) were not
following it.
8. Most of the retailers surveyed (88%) kept multiple brands at the outlet and the
rest kept only Pepsi Brands.
9. SKUs availability was found to be very low, with most of the retailers (61%)
keeping less than 7 SKUs.
10. Almost all retailers kept more than 5 brand types (distinct flavours with distinct
size) at their outlet.
11. Almost all the retailers (89%) kept PEPSI drink at their outlet and most of them
(79%) preferred to keep the pet bottles of Pepsi as well as of other drinks.
12. Most of the retailers (77%) to kept single brand type in their stock just due to
higher market demand.
13. Most of the retailers (47%) said that the promotional activities done by PepsiCo
helped to increase their sales during the period of the scheme.
14. Most of the retailers (78%) said that the sale of the Pepsi at their outlet was
higher than that of the other brands (especially Coca-Colas).
15. Almost all the retailers were satisfied with the timely supply and availability on
demand of Pepsi Brands during the scheme.
16. Almost all the retailers said the schemes of Pepsi to be more beneficial.

101

10.3 FINDINGS
Feedback for PEPSICO
1. PepsiCo brand products margin is good with easy availability on demand.
2. Varun Beverages (PepsiCo) gives better schemes and thus more benefit to the
retailers. So, some retailers are interested to keep Pepsi drinks only.
3. The supply of Pepsi drinks is always on time and according to demand.
4. Most of the retailers reported the services provided by Varun Beverages (PepsiCo)
to be good.
5. Many retailers showed interest in the scheme in the areas where it has not yet been
implemented.
6. Retailers were annoyed with the decreasing sales of Pepsi brands due to nearby
Soda Shops.
7. The most preferred packaging was plastic bottles. Many retailers keep plastic bottles
of local brands (e.g. Jayanti, RCQ etc.) instead of glass bottles of Pepsi brands.
8. The market reach of PepsiCo is excellent, its supply is constant even in the areas
where there is negligible or no supply of Coca-Cola and other brands.
9. PepsiCo does not give free gifts more often to the retailers compared to the
competitors.
10. In some shops, visis are either not available, damaged or there is fridge instead of
visi. According to companys policy some outlet should have visi, but in reality they
did not have visis.
11. Some retailers deliberately close the power supply to visi, proving the promotional
effort to be futile.
12. Most of the outlets have improper placement of visi. Many retailers also keep milk,
butter and other company products in it.
Retailer Feedback
1. In some of the areas distributors have to keep their work at best because of frequent
visit of executives.
2. PepsiCo products supply was reported to be good as compared to that of the CocaColas.
3. Many retailers complained that the order was not delivered sometimes or delivered
too late.
4. In return of the products that were told to the distributors to bring, they bought
something else.

102

5. Few retailers complained about lower gas in 500 ml Lehar-Everest Soda, compared
to other brands in the market.
6. Many retailers complained of receiving Aquafina water in the scheme, instead of
cold-drink bottles.
7. Retailers in some areas complained to get ordered supply without bill, lower scheme
(free products contrary to what PSR says), less products than ordered and delayed
replacement of leak-burst bottles.
8. Some of the retailers preferred to bring the product from the market themselves
because the salesmen didnt have all the varieties of PEPSICO available, when
required.
9. Retailers in some areas bring Pepsi products from the big departmental
stores/multiplexes (e.g. Easy Day), due to lower price of individual products as well
and more profit.
10. Some of the retailers reported that loose packing of beverages causes them to break
often or they burst due to excess of gas.
11. Few retailers complained of unavailability of Mirinda Lemon in their areas.
12. Many retailers demanded the scheme applicable to malls, different scheme for small
outlets, more realistic targets, constant scheme over a fixed period of time (as they
feel apprehensive due to daily changing schemes), relaxed display norms and
desired free products on purchase.
13. Distributors are always in a hurry due to which retailers are not able to check the
dates (mfg/exp) of the products properly and they throw the beverages like anything.
14. Discount is given by the distributors at every purchase of Rs.1000/- but this discount
is not given to all.
15. Sometimes expired products are delivered to the retailers which smell a lot and
retailers complain for them sometime.
16. There is a no product which is strong similar to thums-up, as the retailers keep it just
due to the consumer demand.
Incorrect data:
1. In spite of much asking retailers are not able to give even a rough idea of their
comparative monthly sales.
2. Some people have opened shops in their home as a part time job, such people
dont want to reveal their sales, phone no., even name of their shop because they
fear that objection might be raised, and hence no idea of SKUs, brand types,
available stock, supply and sales of such shops can be made. In addition, there
were many unauthorized shops without any Shop no. in the areas covered.

103

CHARTER-11
SWOT
RECOMMENDATIONS
CONCLUSION

104

SWOT
STRENGTHS
1. Trusted for better products and
schemes with regular new offers for
retailers as well as consumers.
2. Widespread and strong Distribution
Network.
3. Very strong connect with the
retailers.
4. Wide Range products covering all
segments with upcoming variants
suited to Indian needs.
5. Products with contemporary Indian
taste (Nimbooz).
6. Widely accepted products by all
Generations.
7. Availability of products throughout
the year.
8. Established brand name.
9. Sizeable market share in the
country.
10. Offers variety of products under its
brand.
11. Different sized packaging of
available, suited to varied needs of
consumers
12. An experienced team of sales and
marketing executives.
13. Deep and effective coverage in
most of the areas.
14. State-of-the-art automated bottling
process having capacity to meet the
market demand in time.
15. Pure franchising in India with all of
its secret ingredients made
indigenously.

WEAKNESSES
1. Least successful to create good
market for light products (Lower
gas in 500ml Lehar Everest soda).
2. Least successful to dissolve the
image of Thums Up from the mind
of consumers.
3. Delayed release of promotional
material.
4. Absence of any drink that
symbolizes masculinity like the
one of its rival i.e. Coca Cola
has viz. Thumbs up with
strong taste and more fizz.

105

OPPORTUNITIES
1. Development of a new cola product
with contemporary Indian Taste.
2. Good scope for snacks and
namkeens in the Indian market.
3. Conversion of consumer
satisfaction into brand loyalty.
4. Scope for more variants
carbonated Apple juice, like that of
Appy Fizz (Parle) and Fanta Apple
(Coca-Cola).
5. Fast changing lifestyle of Indian
consumers increasing inclination
towards processed foods.
6. Increasing Quality awareness
among consumers and retailers.
7. Information revolution brought
about by the telecommunication
and media.

THREATS
1. Fast budding Soda shops in Jaipur
One of the biggest threats.
2. Increase in sale of cheap local brands.
3. Emergence of 300 ml Pet, slowly
replacing glass bottles.
4. Rising input costs.
5. Emerging substitutes like biscuits &
baked snacks.
6. Brand loyalty of Jaipur people
towards Thums Up.
7. Constant demand for Coca-Colas
products in the market.

106

RECOMMENDATIONS

Marketing Mirinda Lemon As many the retailers are finding MIRINDA

LEMON hard to sale, so the company should work on marketing of the drink
and/or on the flavor. It should be readily available in the monopoly areas of Pepsi
to give it an added advantage.

Opening Franchisee Outlets Some retail outlets could be converted into

conditional franchisee shops of Pepsi and/or new could be opened in the peak
locations of Jaipur with lower priced products, highlighting the advantages of
Pepsi and disadvantages of drinks provided by soda shops. These may counter the
issue of fast budding soda shops which may prove disastrous for the sales of
Pepsi in the long run.

Group Bulk Purchase Scheme for Small Retailers Varun Beverages could
initiate a new scheme similar to that of Gold Club with involvement of more than
one retailers with the benefits distributed equally.

Display of Schemes to Consumers Retailers many times do not show the

bottle cap to the customer, so the customer remains unaware of the prize he/she
won, if any. This is sometimes done deliberately by retailer for the prize money.
The consumers have to made aware about the prize money schemes on the bottle
cap through posters stuck on the shops of retailers, banners etc.

Promotion of Non-Carbonated Drinks Tropicana Juice, Tropicana Twister

and Gatorade are not available at most of the outlets in the market. In case of new
brands of Pepsi Tropicana Twister more efforts are required in marketing to
make the drink popular among customers.

Refining the Promotional Method There is a need to implement a different

promotional method/scheme for small retailers in the areas of big malls (e.g. Easy
Day). The retailers interest in the scheme ceases due to comparatively lower
margin on sales.

Quick Incentive Release The Company should focus on speedy release of

incentives. Because retailers complain about the slow and tiring process of free
gifts, prizes and promotional material distribution (banners umbrellas,
advertisement boards etc.,) even after fulfilling all the conditions, which leads to
the decrease in interest on their part.

New Product Development There is a need to develop a product at par with

Thums-up (brand of coke), according to the contemporary Indian taste liked by
the potential customers. Because the retailers admitted that customers especially
the youth are tending towards it due to the strong flavor and high masculinity
image associated with it.

Training & Incentives to Salesmen The incentives and/or salary of the sales
personnel should be increased and a brief training of interpersonal skills provided
because many retailers complained of frauds viz. giving less free products then
mentioned, fulfilling order without bills, selling products to shops other than
mentioned in official records, incorrect & inadequate order placement and giving
undesired free products to retailers under the scheme.
107

Increase Scheme Awareness There is a need of more vigorous campaigning

to increase awareness of the Gold Club Scheme initiative of Varun Beverages
(PepsiCo).

Promotion in New Areas The Gold Club Scheme scheme in this season
should be implemented in the areas where it has not yet been implemented with
the retailers in those areas showing interest in the same.

Free Gifts Free gifts should be given more often as compared to the
competitors to lure the retailers for more sales.

Electronic billing should be adopted to make the process hassle-free.

108

CONCLUSION
M y Project with VARUN BEVERAGES ( PEPSICO) gave me the practical
knowledge of the relationship between the distributor, wholesaler and the
retailers. It has also helped to understand t he working environment at
Indias largest bottler of PepsiCo.
.
The major things learned during m y entire project are as follows:
Something that is seen most is sold most is mostl y the core
strategy adopted for sales.
Retailers can mould the demand i.e. when certain drink of rival
company is unavailable then the customer goes for another drink,
or take the drink which the retailers offer or suggest to them.
New schemes, lucky draws, free gifts, coupons and complementary
things are the factors which create interest in the retailers as well
as the consumers and thus result in increasing the sales.
Visicoolers, gravit y racks, display b oards or flexes are the most
important merchandising instruments.
It was observed that though there is more merchandising done by
the rival company, but due to its delayed suppl y it could not satisfy
the retailers and thus faces fewer sales.
The retailers having visicoolers and display racks in their stores of
any company just want a proper suppl y of drinks and timel y service
for visis from the company.
The PepsiCo has wide market coverage and has good strong
relationship with its retailers.
Pepsi has a unique brand Mountain Dew of which its rival do not
has any imitated product so Pepsi have an advantage over Coke.
Nimbooz a non -carbonated drink has taken the first over advantage
with better taste compared to the rival companys similar product
and is successful in capturing the market of this segment.
Pepsi faces direct competition from Thums up (Coca-Cola brand).
It is targeting youth, propagating the idea of mens drink and not
for kids, due to its strong taste. Thus is more alluring the attention
of teenagers.
As per Gold club scheme the retailers visi coolers need a timel y
inspection and regular visi service.
Sometimes retailers are highl y dissatisfied with salesmen behavior.
109

BIBLIOGRAPHY

I.

Kothari C.R.
Research Methodology, New Delhi
Vikas publishing House Pvt. Ltd.

II.

Web sites:
A. Google search: (www.google.com)
B. Wikipedia search: (www.wikipedia.com)
C. Yahoo search: (www.yahoo.com)
D. www.PepsiCoIndia.com
E. www.PEPSICOproducts.com

III.

Business World

110

SURVEY OF RETAILERS
TO KNOW THE EFFECTIVENESS OF
THE PROMOTIONAL ACTIVITY OF PEPSICO
QUESTIONNAIRE
OUTLETS NAME .....
OWNER'S NAME ......
ADDRESS .......
......
Q.1) Are you aware about the Gold Club Scheme of PEPSI?
a) Enrolled
b) Not enrolled
c) Unaware
What modifications do you want in the Scheme ........
..
Q.2) How many SKUs (Stock Keeping Units) are present in your outlet?
a) 0 7
c) 12 - 19
b) 7 12
d) 19 or above
Q.3) How many PEPSI Brand types do you have?
a) 1 5
c) 10 - 15
b) 5 10
d) 15 & above
Q.4) What SKU of the PEPSI drink do you keep maximum in stock during the
scheme & why?
.
a) Better offers
c) Inadequate supply

b) Higher market demand

d) Any Other

Q.5) Do you need different size of Visi Cooler during the scheme?
a) Larger size needed
b) Smaller size needed
c) Current size is appropriate
Q.6) Did Visi POG (Plano gram) help you to increase the sales of the PEPSI
Drinks during the scheme?
a) Unaware
b) Aware but do not follow
c) It did not help
Q.7) Why do you avoid to follow Visi POG during the scheme?
a) Difficult to remember the sequence
b) Takes a lot of time & effort to arrange
c) Do not feel the need to follow it
d) Any other
111

Q.8) Hows the supply of the PEPSI drinks during the scheme?
a) Timely supply
b) Delayed supply
Q.9) What is the frequency of supply of the most demanded PEPSI drinks
during the scheme?
a) 6-7 days a week
c) 1-3 days a week
b) 3-6 days a week
d) Very low supply
Q.10) Are the PEPSI drinks readily available on demand during the scheme?
a) Always available on demand
b) Sometimes available
c) Not available
Q.11) Hows the sales of the PEPSI drinks during the scheme as compared to
that of the competitors (especially Coca-Colas) drinks?
a) Much Higher
c) Slightly Lower
b) Slightly Higher
d) Much Lower
Q.12) What is/are the benefit(s) of competitors scheme over that of the PEPSI?
....
.
Q.13) What were the major difficulties faced by you in achieving your target?
a) Low market demand
d) Problems regarding free gifts etc.
b) Poor / slow distribution
e) No Problem
c) Competition in market
f) Any Other
Q.14) Why do you keep the drinks other than PEPSI brands in your outlet
during the scheme?
a) Timely availability
d) Better Packaging
b) Greater market demand
e) Any other
c) More commission
Q.15) According to you what are the reasons for increase in the sales of the
PEPSIs drinks during the scheme?
a) Lucky draw/free gifts
d) New Packaging
b) Advertisement in media
e) Do not matter
c) Promotional Activities
f) Any Other
Q.16) Would you like to be re-associated with the Gold Club Scheme of
PEPSICO next year also?
a) Yes
b) No

112