Presented By

Sandeep Singh (09-II-247)

Neha Sharma (09-II-229)
Bhawana Sharma (09-II-212)
Shyamu Pandey (09-II-250)
Subhojit Bose (09-II-253)
 About PepsiCo
 5 largest food and beverage companies which includes 15
brands
available in nearly 200 countries
Entered India in 1989 and its investment is 700million $
Employment to more than 60,000 people Brand Pepsi is
now the 2nd biggest brand in the country
It has more than 15 brands.
LAY'S®, FRITOS®, CHEE.TOS®, BAKEN-ETS®,
RUFFLES® DORITOS®, FUNYUNS®, TOSTITOS®,
BAKED LAY'S®, WOW!®, SUNCHIPS®, MUNCHIES®,
OBERTO®, ROLD GOLD®, GRANDMA'S® Cookies and
Quaker Chewy Bars®, Quakes® and Fruit & Oatmeal Bars®
 Concept of contract farming
PepsiCo has pioneered the concept of contract farming under
which the company transfers agricultural best practices and
technology and procures the produce at a pre-agreed price.
The farmer is contracted to plant the contractor’s crop on his
land.
Harvest and deliver to the contractor, a quantum of produce,
based upon anticipated yield and contracted acreage
This could be at a pre agreed price
Towards these ends, the contractor can supply the farmer
with selected inputs.
THE ADVANTAGES OF CONTRACT FARMING

Farmer gets exposure to world class agro technology

-Planting materials/healthy disease free nursery.
-Crop monitoring technical advice free at his doorstep
-Agricultural implements
The farmer obtains an assured up front price & market outlet
for his produce
Focus shifts from prices to returns per acre - driven by
productivity increases
The private sector gets requisite quality material regularly at
predetermined prices.
Promotes long term planning and investments
THE PROBLEMS THAT BE SET
CONTRACT FARMING

Small size of farmer landholdings.

Need to contract with a larger number.
No mechanism to discourage default. No legal
recourse when faced with large scale contravention of
contracts.
Lack of a comprehensive crop insurance scheme to
protect against natural calamities
 Helping
The farmers
company's improve
vision yieldaand
is to create income through
cost-effective, Contract
localized Farming
agri supply chain
for its business by:
Strengthening farmer connect from 21,000 in 2009 to 50,000 by 2012.
Building PepsiCo's stature as a development partner by helping farmer grow
more and earn more.
Introduction of new high yielding varieties of Potato, Oats, Citrus and others.
Making world class agricultural practices available to farmers.
Working closely with farmers and state governments to improve agri
sustainability, crop diversification and enhance farmer incomes.
Helping farmers refine their farming techniques and raise farm productivity.
Customized solutions to suit specific geographies and locations.
Facilitate financial and insurance services so as to de-risk farming.
 High Quality Seed Program
In order to provide its farmers “The best quality potato seeds”, PepsiCo
collaborated with the Thapar Institute of Technology to develop quality
potato mini-tubers.
PepsiCo has also made an investment in a world class potato mini-tuber
facility at Zahura in Punjab which helps getting robust and disease-free
seeds to its contract farmers.
27-acre research and demonstration farm was set up in Punjab to support
the initiative to conduct farm trials of new varieties of potato, chilli, corn,
peanut and other crops.
PepsiCo India's technical team implemented a high quality seed
programme to deliver early generation and disease-free seeds to farmers
The Impact of contract Farming
World class, top quality, high-yielding potato varieties introduced.
High yielding potato seeds have enabled farmers to produce world
class potatoes and procure higher returns.
PepsiCo India has partnered with more than 11,000 farmers working
across Punjab, U.P., Karnataka, Bihar, West Bengal, Gujarat and
Maharashtra for the supply of world class chip-grade potatoes.
Partnered with State Bank of India to get soft loans to all its contract
farmers to reduce their cost of cultivation and save them from the
clutches of money lenders (higher interest rates).
PepsiCo Various Projects
Citrus Project
-The PepsiCo and PAGREXCO (Punjab Agri Export
Corporation) partnered to start a Citrus Development
initiative in 2002, marked a step forward in PepsiCo's
commitment to diversification of agriculture and
improvement in quality of life for farmers
PepsiCo India has also partnered with 1,200
farmers in Rajasthan to cultivate barley in a tie-up
with the United Breweries Group.
The Impact of project
Initiative has emerged as one of the most successful models of
public-private partnerships in Indian agri-business and would
create a localized supply base for citrus juice for Tropicana
business.
Project played a significant role in introducing a less water
intensive alternative to crops such as paddy.
Today, farmers can choose from 16 varieties of rootstock and 34
varieties of citrus, largest collection at a commercial nursery.
Technical support and expertise were extended to the Punjab
Government to set up two fruit processing plants in Hoshiarpur
and Abohar - prime citrus growing areas in Punjab.
Each plant is capable of processing multiple fruits and capable of
acting as a catalyst for farmers to adopt horticulture.
Key elements of PepsiCo’s success
Core R&D team
Unique partnership with local agencies including a public sector
enterprise
Execution of technology transfer through well-trained extension
personnel
Supply of all kinds of agricultural implements free of cost to contracted
farmer
Supply of timely and quality farm inputs on credit
Buying only quality potato under two price options – fixed contract and
open market linked prices
Managed production risk of the growers by bringing in insurance, and
low cost input supply and credit into contracting with formal contracts.