Entry of Pepsi in India

Bhaskar Bagave 65
Venus Kapadia 78
Hana Meshram 82
Sujay Venkat 96
 PepsiCo in India
• Established in 1989
• 4th largest consumer products company
• Tasty Treats to Healthy Eats
• 36 bottling plants (13 Company & 23
Franchise owned)
• 3 State-of-the-art food plants
 Why do companies like Pepsi need to
globalise? What are the various ways in
which foreign companies can enter a
foreign market? What hurdles and
problems did Pepsi face when it tried to
enter India during 1980’s?
Why do companies like Pepsi need to
globalise?

• Dominant economic factors

• Five competitive forces
• Brand loyalty
• Industry changes
 What are the various ways in which
foreign companies can enter a foreign
market?
• Joint Ventures
• Distribution channels
• Franchising
• Licensing
• Offices and Subsidiaries
 What hurdles and problems did Pepsi
face when it tried to enter India
during the 1980’s?

• Political issues
• Rejection of proposal by government
• Opposition from social and political groups
 Critically analyze the strategy adopted by
Pepsi to sell itself to the Indian
government.
Do you think the biggest factor responsible
for the acceptance of its proposal by the
regulatory authorities was its projection of
its operation as the solution to many of
Punjab’s problem? Why/Why not?
• Yes
• Proper use of additional 2 P’s other than
the traditional 4 P’s
• Politics and Public Opinion
• How they use these 2P’s?
•Use of sensitive issue properly
•Importance to Agriculture
•Emphasis on Employment
•Export
•Foreign Exchange
•An agricultural research center
•Regional Language
How did company react to changes in
the business environment after the
liberalization of the economy in the
early 1990s?Critically comment on
the allegations that Pepsi
deliberately did not adhere to most
of its commitments?
• Establishing wholly owned subsidiary
PepsiCo Holding India Pvt. Ltd.

• Changed name from “Lehar Pepsi” to

“Pepsi”

• Sold off its Tomato Paste Plant in 1995

• Failing to create jobs
• 50% of employee working for
Concentrate and Bottling Business not
for Food processing Business
• Pepsi with Futura Polymers Ltd. were
reducing the workforce and more
machine oriented
Examine the contract framing initiatives
undertaken by Pepsi in India and explain
the rationale for such initiative from the
company’s prospective. Why is it important
for multinational corporations to work
towards the improvement of the economics
in the country in which the operates?
What are the various other ways in which
this can be done?
• Contract farming + Equipment
• Tomatoes
• Groundnuts
• Potatoes
• Basmati Rice
• Agro research centre – late 90’s
 Rationale

• Bring in quality and technology

• Tap in the abundant labour
• Reach to the huge consumer base
• Exports
 Reasons for improving host
country's economy

• Help in production and distribution

• Skill level of the worker
• Increase in exports
• Attract more potential investors
• Employ more jobs – more pay than the
domestic companies
• Purchasing power and consuming power
• Tax base will rise – more money for
domestic use
• Receptive to change and know how of
global market
Thank You