A project report on various policies of pepsi toward retailers mba marketing

STUDY ON VARIOUS POLICIES OF PEPSI TOWARD RETAILERS
AT NECTAR BEVERAGES PVT.LTD

INDEX

Sl. No. PARTICULARS PAGE
NO
1 Declaration 0-1

2 Acknowledgment 0-2

3 Executive Summary 3-4

4 Industry overview 5-9

5 Company profile 10-73

About Organization

6 Findings & Conclusion 74-75

7 Recommendations 76-0

8 Limitation of study 77-0

9 Bibliography 78-0

10 Annexure 79-84

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Babasabpatilfreepptmba.com


EXECUTIVE SUMMARY

Nectar Beverages Pvt. Ltd., Dharwad is a franchisee of PepsiCo Company,
which is one of the major players in carbonated beverages world market.

Retailers are plays a crucial role in any FMCG. This survey covers all the
dimensions, which retailers consider while carrying out their business. This survey
hold lot of value as it is done at the peak the season.

My project is titled "STUDY ON VARIOUS POLICIES OF PEPSI TOWARD RETAILERS AT
NECTAR BEVERAGE PVT.LTD". I undertook this study for their soft drink products. During the
course of my study my job was to find out the satisfaction of the retailers towards the promotions
provided by the company in these areas. During the course of my study my job was to find
out the channels of distribution of the company in Hubli city and also to find out the
satisfaction of the retailers towards the supply and coolers provided by the company
in these areas.

Methodology:
This report is based on the survey conducted in Hubli-Dharwad market. It also
collects the secondary information from the website of prime research companies.

Sampling Method:

All the potential dealers in a particular sub route were considered in the sample. The
general outlets included pan shops, bakeries, general stores, bars and restaurants,
Xerox and S.T.D shops. From the research it is clear that all most all the retailers keep
Pepsi and Coke in their shop.

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Sample size:
All the potential retailers in Hubli-Dharwad were considered in sample (100)
.
Types of marketers:
Retailers mainly divided in convenience stores, eateries, groceries, bar and wine.

FININDNGS
1) From the research it is clear that all most all the retailers keep Pepsi and Coke
in their shop. i.e. Pepsi 28%
2) Most of the retailers are doing business more than 4 years i.e. 66%, between 2
to 3 years 20%, 1 to 2 years 6%, less than 1 year 8%.
3) As according to the consumer demand most of the retailers stores in their shop
Pepsi 28%.
4) Most of the retailers are satisfied with the Company service i.e. 45% but 55%
of the retailers are not satisfied with the company policies.

CONCLUSION
Thus according to this survey we conclude that most of the retailers stock both
the products Pepsi and Coke because of consumer demand for the product and also for
the service provided by the company.
Retailers prefer Pepsi brand more because sales person maintain a very good
relationship with the retailer.
Retailers prefer Pepsi brand more because quality.
The most important parameter is the scheme given by Pepsi is really good and
attractive.

INDUSTRY OVERVIEW

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The Indian Carbonated Beverage Industry is a very dynamic industry. The soft drinks
are the life style brands and are closely related with the consumers. The passion for
cricket in the country makes it a unique market.

The Indian Carbonated Beverage Industry is worth Rs.1000/- crore.The current
growth rate of industry is 8%.The main ingredients of a soft drink are water, sugar,
added flavors, and carbonated gas.

Though some outlets like bar restaurants running business throughout year, for other
channels the peak season is between Februarys to June.

In Dharwad retailers Pepsi has58% market and coke has 42% retail market The
phenomenal sales growth of carbonated soft drinks Pepsi (about 30 to 35 per cent) and
Coca-Cola (40 per cent and above) in the months of April and May 2003 has proved
that there is a right price for everything - you just have to get to it.

The success is mostly due to a cutthroat price war initiated Coca-Cola India when it
launched Coke in 200 ml packs priced at Rs. 5 Pepsi India was left with no choice but
to follow suit. Not only this, Pepsi went one-step further and slashed prices of its 300
ml packs to Rs. 6 all because it didn’t have 200 ml bottles.

Some slick advertising of course, augmented the price war, with Coke bringing in
film star Aamir Khan in various regional guises to reinforce its price-led strategy.
Pepsi, not to be out done, roped in reigning queen Aishwarya and current heartthrob
Vivek Oberoi to do the honors.

For two companies, which repeatedly requested the government to reduce the excised
duty on these to help increase sales, have achieved an unprecedented sales growth
with the very same soft drinks.
In fact so great has been the sales growth of the soft drink brands that the companies
now seem to be shelving its earlier plans to launch juices and other beverages in the
domestic market.

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Pepsi India claims that while the sales of Pepsi grew by 25% – 30% in April and are
expected to register a 30% - 40 % growth in May, its other CSD brands, Mountain
Dew and Blue Pepsi, Have done quite well. Though that can’t be said of the
companies lime-flavored Pepsi Aha and juice brand Slice; they have performed below
expectations.

Led by a riveting ad campaign, Mountain Dew has already grabbed a 5% share of the
Rs. 7,000 crore-carbonated soft drink industry since its launch. For the moment
PepsiCo India is putting juice brand Slice under Review. Originally launched in a
mango flavor in returnable glass bottles, Slice was extended to cartons two years
back. It has since then been introduced in flavors such as litchi and guava.

Coca-Cola India also says it has logged spectacular sales in the past few months. It
claims it has registered a sales growth of over 40% overall during the last two months,
while in a few urban pockets like New Delhi and Hyderabad the sales growth was as
high as 70% -80% in the month of May.

The company has also increased its village penetration from 9% in year 2000 to 25%
in 2003 by adding 40,000 more villages. It has added 30 new lines from September
2002 and has added 9 million cases of new glass to its operations.

Compare this with the fact that it had about 20 million cases of glass in the market
during the last 10 years. The total number of Coca-Cola outlets has increased from 6,
00,000 to 7, 50,000 from 2000 and the company is giving out additional 2.5lakh
refrigerators this year. Coca-Cola is also said to be putting its plans of launching juice
and milk-based beverages on the back burner and grow CSD sales while the summer
heat rages.
Interestingly, with carbonated beverages segment, its lime-based drinks like Sprite,
Limca and 7-Up, besides diet variants of Coke and Pepsi, which are growing faster
than the two big colas.

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It’s the same in the US, Europe and Japan. In the US, for instance, fizzy drinks have
been on the decline since their sales peaked in 1998, while categories like water,
energy drinks and juices are growing. Pepsi’s volume declined 4% last year, while
Coca-Cola has launched only diet drinks in the last two years.

Changing Taste
US: Fizzy drinks on decline since 1998. Pepsi slumped 4% last year, Coke bringing
only diet drinks.

UK: Fruit juices command 66% of market, growing at 60%. Even Coke launching
juices

Japan: Iced tea and coffee dominates market. Coke’s Georgia coffee outsells cola.

India: Juices and non-fizzy drinks growing at 40%. Colas grow at 10% Juice brands
growing faster

It’s not just in India that people prefer juices, flavored milk, butter milk and juice
based drinks over fizzy cola drinks.

In UK, Coca-Cola introduced minute maid juice this month to meet booming juice
sales. In Japan, Coca-Cola’s Georgia coffee outsells coke. In India, PepsiCo’s
Tropicana and Dabur’s Real are driving growth in the 100% juice market, while
various non-aerated beverage brands have flooded retail shelves. coke has re launched
its fruit-based drink Maaza in three flavors, while Amul has added buttermilk to its
range of flavored milk and cold coffee, and Parle Agro has given a new look to Frooti.
Obviously, tetra packaging is playing a role in making available these health
drinks more easily. Rasna has hired Hrithik Roshan to push sales, while Nestle has
stepped up distribution for its tetra pack milk and cold coffee range. Godrej’s XS
fruit juice, and Mother dairy’s Safal have also stepped up marketing and distribution

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spends. Smaller juice brands like Leh Berrry and Tuk 3 are also growing in healthy
double digits.

The man with the mission heads straight to the owner to the shops and fires his
volley of questions, after a brief introduction: “Hum Pepsi Company se aye hain.
Coca-Cola company koi discount de raha hai? Hamaara aadmi time par maal deliver
karta hai?”

This man from Pepsi is none other than its brand new head Rajeev Bakshi,
who after a three-year turnaround stint with Cadbury India joined Pepsi last year, but
formally, took over only now. On a field trip in Gurgaon, Haryana, Brand Equity
trailed Bakshi alone the route into the far-flung suburbs to get a ‘real’ taste of life. A
man possessed, he’s busy making mental notes, and mostly absorbed in deep thought.

A small break at the office, and he’s off to South Delhi with Anurag Jaipuria of Jai
Drinks, Pepsi’s bottles for Delhi and Jammu. And then, he plans to go on to
Sultanpur it’s all in a day’s work for the Pepsi chief. “It’s bloody important for me to
go out into the market. One wrong move can lead to dramatic changes in market
share. The pricing is quite essential in the business and any minor change can lead to
huge changes in fortunes. Advertising here is conventional, not in content but in
terms of time frames,” says Bakshi, in an interaction with BE that lasted nearly three
hours.

It’s marketing by wandering around, to give a small twist to a Tom Peters phrase. The
field trips, says Bakshi, alert him to what is going on at the ground level, help him
identify gaps and develop an action plan. Says a CEO of an FMCG company:
“Mr.PM Sinha was a good salesman, but he never really ran good businesses, not
even at Hindustan Lever. Mr.Rajeev mandate is to make money and, you watch, he’ll
bring some sanity into the company.”

2009 Carbonated Soft Drinks in the U.S. (Summer 2009)

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It’s tough at the top. Explore the stats, trends and offensive and defensive
strategies in the leading beverage category. Including volume Dollar sales nation wide
as well as by region and by state. Also includes per capita consumption and five-year
growth projections as well as data on and discussion of regular and diet, flavors,
package vs. fountain, pricing, retail channels, distribution, advertising, consumer
demographics and leading brands. Detailed looks at the leading companies, their
strategies, management and financing.

Coca-Cola India

Coca-Cola India, the country’s largest carbonated soft drinks producer
refreshes millions of consumers throughout the country with an exciting range of
beverages including Coca-Cola, Diet Coke, Vanilla Coke, Thums Up, Fanta, Limca,
Sprite, Maaza, Sunfill, Georgia, Georgia Gold, Kinley and Kinley Club Soda through
a network of more than one million outlets. The company has invested more than US
$1 billion in its Indian operations, emerging as one of the country’s top international
investors and employs approximately 6,000 people in India.

COMPANY OVERVIEW
About the Pepsi-Cola Company
The summer of 1898, as usual, was hot and humid in New Bern,
North Carolina. So a young pharmacist named Caleb Bradham began experimenting
with combinations of spices, juices, and syrups trying to create a refreshing new drink

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to serve his customers. He succeeded beyond all expectations because he invented the
beverage known around the world as Pepsi-Cola

Pepsi-Cola was so popular that Caleb Bradham (circled) could hardly take time
away from his soda fountain customers to pose for this picture.

Caleb Braham knew that to keep people returning to his pharmacy, he would have to
turn it into a gathering place.

In 1902, he launched the Pepsi-Cola Company in the back room of his pharmacy, and
applied to the U.S. Patent Office for a trademark. At first, he mixed the syrup himself
and sold it exclusively through soda fountains.
.
The business began to grow, and on June 16, 1903, "Pepsi-Cola" was officially
registered with the U.S. Patent Office. That year, Caleb sold 7,968 gallons of syrup,
using the theme line "Exhilarating, Invigorating, Aids Digestion." He also began
awarding franchises to bottle Pepsi to independent investors, whose number grew
from just two in 1905, in the cities of Charlotte and Durham, North Carolina, to 15 the
following year, and 40 by 1907. By the end of 1910, there were Pepsi-Cola franchises
in 24 states.

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Pepsi-Cola's first bottling line resulted from some less-than-sophisticated
engineering in the back room of Caleb's pharmacy.

Building a strong franchise system was one of Caleb's greatest achievements. Local
Pepsi-Cola bottlers, entrepreneurial in spirit and dedicated to the product's success,
provided a sturdy foundation. They were the cornerstone of thePepsi-Colaenterprise
Growth was phenomenal, and in 1909 Caleb erected a headquarters so spectacular
that the town of New Bern pictured it on a postcard. Famous racingcar driver Barney
Oldfield endorsed Pepsi in newspaper ads as "A bully drink...refreshing, invigorating,
a fine bracer before a race."

The previous year, Pepsi had been one of the first companies in the United
States to switch from horse-drawn transport to motor vehicles, and Caleb's business
expertise captured widespread attention. He was even mentioned as a possible
candidate for Governor. A 1913 editorial in the Greensboro Patriot praised him for his
"keen and energetic business sense."

Pepsi-Cola enjoyed 17 unbroken years of success. Caleb now promoted Pepsi sales
with the slogan, "Drink Pepsi-Cola. It will satisfy you." Then came World War I, and
the cost of doing business increased drastically. Sugar prices see sawed between
record highs and disastrous lows, and so did the price of producing Pepsi-Cola. Caleb
was forced into a series of business gambles just to survive, until finally, after three
exhausting years, his luck ran out and he was bankrupted. By 1921, only two plants
remained

It wasn't until a successful candy manufacturer, Charles G. Guth, appeared on the
scene that the future of Pepsi-Cola was assured. Guth was president of Loft

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Incorporated, a large chain of candy stores and soda fountains along the eastern
seaboard. He saw Pepsi-Cola as an opportunity to discontinue an unsatisfactory
business relationship with the Coca-Cola Company, and at the same time to add an
attractive drawing card to Loft's soda fountains. He was right. After five owners and
15 unprofitable years, Pepsi-Cola was once again a thriving national brand.

PEPSICO MISSION:

PepsiCo’s overall mission is to increase the value of our share holder’s
investment. We do this trough sales growth, cost control and wise investment of
resources. We believe our commercial success depends upon offering quality and
value to our consumers and customers; providing products that are safe, wholesome,
economically efficient and environmentally sound; and providing a fair return to our
investors while adhering to the highest standards of integrity.

This page focuses on the soft drink industry, and two of its major competitors;
Pepsi and Coca-cola. This page will take an in depth view at the structure these two
companies have and how they are influenced by each other.

PEPSI-COLA BEVERAGES

PepsiCo’s beverage business was founded 1898 by Caleb Bradham, a New Bern,
North Carolina druggist, who first formulated Pepsi-Cola.

Today, Brand Pepsi is part of a portfolio of beverage brands that includes
carbonated soft drinks, juices and juice drinks, ready-to-drink teas and coffee drinks,
isotonic sports drinks, bottled water and enhanced waters. PBNA has well known
brand such as Mountain Dew, Diet Pepsi, Gatorade, Tropicana Pure Premium,
Aquafina water, Sierra Mist, Mug, Tropicana juice drinks, Propel, SoBe, Slice, Dole,
Tropicana Twister and Tropicana Season’s Best.

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PBNA manufactures and sells concentrate for some of these brands to licensed
bottlers, who sell the branded products to independent distributors and retailers.
PBNA provides advertising, marketing, sales and promotional support for its brands.
This includes some of the world's best-loved and most-recognized advertising.

In 1992 PBNA formed a partnership with Thomas J. Lipton Co. to selling ready-
to-drink tea brands in the United States. Pepsi-Cola also markets Frappuccino ready-
to-drink coffee through a partnership with Starbucks.

Frito-Lay

The company consists of Frito-Lay North America, PepsiCo Beverages North
America, PepsiCo International and Quaker Foods North America.

PepsiCo brands are available in nearly 200 countries and territories and
generate sales at the retail level of about $85 billion.

Many of PepsiCo's brand names are more than 100-years-old, but the
corporation is relatively young. PepsiCo was founded in 1965 through the merger of
Pepsi-Cola and Frito-Lay. Tropicana was acquired in 1998 and PepsiCo merged with
The Quaker Oats Company, including Gatorade, in 2001.

PepsiCo offers product choices to meet a broad variety of needs and
preference -- from fun-for-you items to product choices that contribute to healthier
lifestyles.

PepsiCo’s mission is “To be the world's premier consumer Products Company
focused on convenient foods and beverages. We seek to produce healthy financial
rewards to investors as we provide opportunities for growth and enrichment to our
employees, our business partners and the communities in which we operate. And in
everything we do, we strive for honesty, fairness and integrity.”

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PepsiCo's snack food operations had their start in 1932 when two separate events took
place. In San Antonio, Texas, Elmer Doolin bought the recipe for an unknown food
product – a corn chip – and started an entirely new industry. The product was Fritos
brand corn chips, and his firm became the Frito Company.

GATORADE & TROPICANA

Tropicana was founded in 1947 by Anthony Rossi as a Florida fruit packaging
business. In 1954 Rossi pioneered a pasteurization process for orange juice. For the
first time, consumers could enjoy the fresh taste of pure not-from-concentrate 100%
Florida orange juice in a ready-to-serve package. The juice, Tropicana Pure Premium,
became the company’s flagship product. PepsiCo acquired Tropicana, including the
Dole juice business, in August 1998.

SoBe became a part of PBNA in 2001. SoBe manufactures and markets an
innovative line of beverages including fruit blends, energy drinks, dairy-based drinks,
exotic teas and other beverages with herbal ingredients.

Gatorade thirst quencher sport drinks was acquired by The Quaker Oats
Company in 1983 and became a part of PepsiCo with the merger in 2001. Gatorade is
the first isotonic sports drink. Created in 1965 by researchers at the University of
Florida for the school's football team, "The Gators," Gatorade is now the world's
leading sport's drink.

PepsiCo Beverages North America includes the United States and Canada

Pepsi-Cola began selling its products outside the United States and Canada in
the mid-1930s, opening in the United Kingdom in 1936. Operations grew rapidly
beginning in the 1950s. Today, PepsiCo beverages are available in more than 170
countries and territories. Brands include Aquafina, Gatorade and Tropicana.

In addition to brands marketed in the United States, PepsiCo International brands
include Mirinda, Seven-Up and many local brands.

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PepsiCo began its international snack food operations in 1966. Today, products
are available in nearly 170 countries. Often PepsiCo snack food products are known
by local names.

QUAKER FOODS:

The Quaker Oats Company was formed in 1901 when several American pioneers in
oat milling came together to incorporate. In Ravenna, Ohio, Henry D. Seymour and
William Heston had established the Quaker Mill Company. The figure of a man in
Quaker clothes became the first registered trademark for breakfast cereal and remains
the hallmark for Quaker Oats today.

In Cedar Rapids, Iowa, John Stuart and his son, Robert, and their partner, George
Douglas, operated the largest cereal mill of the time. Ferdinand Schumacher, known
as "The Oatmeal King," had founded German Mills American Oatmeal Company in
1856.

Combining The Quaker Mill Company with the Stuart and Schumacher businesses
brought together the top oats milling expertise in the country as The Quaker Oats
Company.

The first major acquisition of the company was Aunt Jemima Mills Company in 1926,
which is today the leading manufacturer of pancake mixes and syrup. Gatorade was
acquired in 1983.

In 1986, The Quaker Oats Company acquired the Golden Grain Company, producers
of Rice-A-Roni.

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PepsiCo merged with The Quaker Oats Company in 2001.

Pepsi profit fizz:

Pop! Fizz. Ah-h! It happens millions of times a day, every day. That feeling of thirst
hits, someone opens a Pepsi and the magic begins. Cold... Delicious. Each time, every
time.

Of course, that's what you expect from a great product like Pepsi-Cola. Or from Diet
Pepsi, Mountain Dew or any of our other popular soft drinks and other beverages.

But how do we do it? How can the people at Pepsi be sure that every single bottle and
can of Pepsi-Cola is always great-tasting, sparkling and fresh?

Actually, there's no secret to how to make Pepsi (except for the recipe). But there is a
system. And that system, plus a lot of hard work, is what enables Pepsi-Cola and the
independent Pepsi-Cola bottlers all around the world to bring you that high-quality,
consistently refreshing Pepsi taste each time you open one of our products.

The system starts with the finest ingredients available – kola nuts, vanilla beans,
flavor oils, citrus, sweeteners and the purest waters we can distill. Then we add the
best technology and all the care we can muster to blend our ingredients.

And during the 100-plus years we've been making soft drinks, we've also created our
own exacting production and quality standards, monitored with constant testing to
guarantee quality and consistency in our products.

Finally, we have our own local distribution system. It's designed to make sure that the
Pepsi you open at home is as fresh and delicious as it was when we sealed it at our
plant. And it serves every city and town in the United States.

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Complicated? Sure. And expensive, too. But there's no other way we can be certain
that Pepsi-Cola products you buy are the highest quality, best value products we can
make.

Now, here's what all of those steps look like:

Flavor concentrates are shipped from special Pepsi-Cola manufacturing plants in
heavy-duty, air-tight containers. Liquid sweeteners are transported in special tanker
trucks. All ingredients and food products are stored in clean, sanitary areas, and items
requiring refrigeration are kept in temperature-controlled areas.

The bottles and cans that will eventually be filled with Pepsi are manufactured
elsewhere, and shipped to Pepsi plants wrapped and sealed for protection. Labels,
cartons, caps, the carbon dioxide used to carbonate soft drinks and other supplies are
also produced for Pepsi by other companies. On arrival, everything is subject to
careful inspection to make certain all of the ingredients and materials meet high Pepsi
standards.

Special equipment is used to uncase and depletive incoming shipments of bottles and
cans. Cans are by far the most popular package with consumers because they're
lightweight and easy to store. Though bulky, the cartons and pallets on which the
empty packages arrive are also relatively light in weight, so it's easy for the machines
to automatically remove the cans from their shipping containers at high speed. The
machines then transfer the individual packages to a conveyor belt.

Once on the belt, cans are part of an enclosed, controlled environment that keeps them
sanitary and helps ensure quality throughout the filling process. They travel rapidly
through a printer that applies a production code to each can.

Then they're automatically turned upside down, and rinsed thoroughly with filtered
water before proceeding directly to the filler.

Water is a key ingredient in all soft drinks. Pepsi-Cola takes special care to purify the
water it uses – a procedure that involves careful treatment, filtration and purification.

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Pepsi standards are precise and closely monitored at every step of the process. The
result of this kind of painstaking attention to detail is that the water used in Pepsi-Cola
and all of our beverages is among the purest available anywhere.

Pepsi-Cola flavor concentrate is carefully combined with sweeteners and other
ingredients in large stainless steel mixing tanks. Quality control audits performed by
specially trained technicians are a critical part of the manufacturing sequence for each
batch, and are typical of the attention to detail that's necessary if the highest possible
quality standards are to be maintained. Cleanliness is also vital, so all internal and
external surfaces of the production system, including syrup lines, proportioning,
cooling and carbonating equipment, are meticulously sanitized.

In the last step of the manufacturing process, as the now-rinsed cans reach the filler,
they're reinvented, immediately filled and the lid is applied – at an average speed of
1,200 cans per minute. The filler is where the syrups from the mixing tanks are
combined with the purified water from the filtration process. The liquid is then
carbonated. This carbonation process gives soft drinks the special sparkle – fizzy
bubbles – that adds to their quality of refreshment.

All Pepsi cans and bottles are imprinted with a freshness date, which is a date code
that tells you your soft drink is fresh. A final quality check ensures that the package is
properly filled, sealed and labeled.

As products leave the manufacturing line, they're combined into a variety of packages
– six- or 12-packs, 24- or 30-can cases or cases of individual two-liter bottles.

The Manufacturing Process

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Most soft drinks are made at local bottling and canning companies. Brand name
franchise companies grant licenses to bottlers to mix the soft drinks in strict
accordance to their secret formulas and their required manufacturing procedures.

RAW MATERIALS

Carbonated water constitutes up to 94% of a soft drink. Carbon dioxide adds that
special sparkle and bites to the beverage and also acts as a mild preservative. Carbon
dioxide is a uniquely suitable gas for soft drinks because it is inert, non-toxic, and
relatively inexpensive and easy to liquefy.

The second main ingredient is sugar, which makes up 7-12% of a soft drink. Used in
either dry or liquid form, sugar adds sweetness and body to the beverage, enhancing
the "mouth-feel," an important component for consumer enjoyment of a soft drink.
Sugar also balances flavors and acids.

Sugar-free soft drinks stemmed from a sugar scarcity during World War II. Soft drink
manufacturers turned to high-intensity sweeteners, mainly saccharin, which was
phased out in the 1970s when it was declared a potential carcinogen. Other sugar
substitutes were introduced more successfully, notably aspartame, or Nutria-Sweet,
which was widely used throughout the 1980s and 1990s for diet soft drinks. Because
some high-intensity sweeteners do not provide the desired mouth-feel and aftertaste of
sugar, they often are combined with sugar and other sweeteners and flavors to
improve the beverage.

The overall flavor of a soft drink depends on an intricate balance of sweetness,
tartness, and acidity (pH). Acids add sharpness to the background taste and enhance
the thirst-quenching experience by stimulating saliva flow. The most common acid in
soft drinks is citric acid, which has a lemony flavor. Acids also reduce pH levels,
mildly preserving the beverage.

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Very small quantities of other additives enhance taste, mouth-feel, aroma, and
appearance of the beverage. There is an endless range of flavorings; they may be
natural, natural identical (chemically synthesized imitations), or artificial (chemically
unrelated to natural flavors). Emulsions are added to soft drinks primarily to enhance
"eye appeal" by serving as clouding agents. Emulsions are mixtures of liquids that are
generally incompatible. They consist of water-based elements, such as gums, pectin’s,
and preservatives; and oil-based liquids, such as flavors, colors, and weighing agents.
Saponins enhance the foamy head of certain soft drinks, like cream soda and ginger
beer.

To impede the growth of microorganisms and prevent deterioration,
preservatives are added to soft drinks. Anti-oxidants, such as BHA and ascorbic acid,

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maintain color and flavor. Beginning in the 1980s, soft drink manufacturers opted for
natural additives in response to increasing health concerns of the public.

Impurities in the water are removed through a process of coagulation,
filtration, and chlorination. Coagulation involves mixing flock into the water to
absorb suspended particles. The water is then poured through a sand filter to remove
fine particles of Roc. To sterilize the water, small amounts of chlorine are added to
the water and filtered out.

Clarifying the water

The quality of water is crucial to the success of a soft drink. Impurities, such
as suspended particles, organic matter, and bacteria, may degrade taste and color.
They are generally removed through the traditional process of a series of coagulation,
filtration, and chlorination. Coagulation involves mixing a gelatinous precipitate, or
flock (ferric sulphate or aluminum sulphate), into the water. The flock absorbs
suspended particles, making them larger and more easily trapped by filters. During the
clarification process, alkalinity must be adjusted with an addition of lime to reach the
desired pH level.

Filtering, sterilizing, and dechlorinating the water

The clarified water is poured through a sand filter to remove fine particles of floc.
The water passes through a layer of sand and courser beds of gravel to capture the
particles.

Sterilization is necessary to destroy bacteria and organic compounds that might spoil
the water's taste or color. The water is pumped into a storage tank and is dosed with a
small amount of free chlorine. The chlorinated water remains in the storage

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Next, an activated carbon filter dechlorinates the water and removes residual
organic matter, much like the sand filter. A vacuum pump de-aerates the water before
it passes into a dosing station.

Mixing the ingredients

The dissolved sugar and flavor concentrates are pumped into the dosing
station in a predetermined sequence according to their compatibility. The ingredients
are conveyed into batch tanks where they are carefully mixed; too much agitation can
cause unwanted aeration. The syrup may be sterilized while in the tanks, using
ultraviolet radiation or flash pasteurization, which involves quickly heating and
cooling the mixture. Fruit based syrups generally must be pasteurized.

The water and syrup are carefully combined by sophisticated machines, called
proportion, which regulate the flow rates and ratios of the liquids. The vessels are
pressurized with carbon dioxide to prevent aeration of the mixture.

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Carbonating the beverage

Carbonation is generally added to the finished product, though it may be
mixed into the water at an earlier stage. The temperature of the liquid must be
carefully controlled since carbon dioxide solubility increases as the liquid temperature
decreases. Many carbonators are equipped with their own cooling systems. The
amount of carbon dioxide pressure used depends on the type of soft drink. For
instance, fruit drinks require far less carbonation than mixer drinks, such as tonics,
which are meant to be diluted with other liquids. The beverage is slightly over-
pressured with carbon dioxide to facilitate the movement into storage tanks and
ultimately to the filler machine.

Filling and packaging

The finished product is transferred into bottles or cans at extremely high flow rates.
The containers are immediately sealed with pressure-resistant closures, either tinplate
or steel crowns with corrugated edges, twist off, or pull tabs.

Because soft drinks are generally cooled during the manufacturing process, they must
be brought to room temperature before labeling to prevent condensation from ruining
the labels. This is usually achieved by spraying the containers with warm water and
drying them. Labels are then affixed to bottles to provide information about the brand,
ingredients, shelf life, and safe use of the product. Most labels are made of paper
though some are made of a plastic film. Cans are generally pre-printed with product
information before the filling stage.

QUALITY CONTROL

Soft drink manufacturers adhere to strict water quality standards for allowable
dissolved solids, alkalinity, chlorides, sulfates, iron, and aluminum. Not only is it in

22


the interest of public health, but clean water also facilitates the production process and
maintains consistency in flavor, color, and body. Microbiological and other testing
occur regularly. The National Soft Drink Association and other agencies set standards
for regulating the quality of sugar and other ingredients. If soft drinks are produced
with low-quality sugar, particles in the beverage will spoil it, creating floc. To prevent
such spoilage, sugar must be carefully handled in dry, sanitized environments.

It is crucial for soft drink manufacturers to inspect raw materials before they are
mixed with other ingredients, because preservatives may not kill all bacteria. All
tanks, pumps, and containers are thoroughly sterilized and continuously monitored.
Cans, make of aluminum alloy or tin-coated low-carbon steel, are lacquered internally
to seal the metal and prevent corrosion from contact with the beverage. Soft drink
manufacturers also recommend specific storage conditions to retailers to insure that
the beverages do not spoil. The shelf life of soft drinks is generally at least one year.

RECYCLING

The $27 billion dollar soft drink industry generated about 110 billion containers each
year in the early 1990s. About half of soft drink containers were aluminum cans and
the other half, about 35 billion, were PET plastic bottles. Nearly 60% of all soft drink
containers were recycled, the highest rate for any packaging in the United States.
Environmental concerns continued to lead to improvements and innovations in
packaging technology, including the development of refillable and reusable
containers.

MARKETING, ADVERTISING, AND COMPETITION

The company generally sells product directly to retail stores and outlets by
their employees. Over the past few years, product creation has slowed down. The
company has stopped concentrating so much on creating so many new products, and

23


has turned their concentration to attaining new franchises and advertising. The
acquisition of contacts with smaller franchises is important in order to continue
growing revenue. The advertising concentration has become necessary as a defensive
maneuver to deal with competitors.

Brand recognition is the significant factor affecting Pepsi’s competitive position.
Pepsi’s brand mane is known well throughout 90% of the world today. The primary
concern over the past few years has been to get this name brand to be even better
known.

Packaging changes have also affected sales and industry positioning, but in general,
the public has tended not to be affected by anew products. The primary competitor of
the Pepsi Company is Coco-Cola Company. Pepsi and Coca-Cola make up anywhere
from 75% to90% of the market where they operate.

DISTRIBUTION NETWORK
There is no involvement of wholesalers in the distribution of product. It is more like
an agent network. The companies have divided the country into various regions and
established a franchisee in each region. The franchisees have their own bottling plants
and manage all the day-to-day operations. However, of late, the soft drinks companies
have started setting up company owned bottling units/have been acquiring some of its
franchisee bottles.

Brands:
PEPSI BRANDS

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7-up Gold 7-up 1988

Pepsi A. M. Pepsi-Cola 1989

Pepsi’s Wild Bunch Pepsi-Cola 1991

Crystal Pepsi Pepsi-Cola 1992

Pepsi Company is using wonderful slogan

PYASS HAI BADI

YE DIL MANGE MORE

HAVE A PEPSI DAY

THE GENERATION NEXT

PEPSI NOTHING OFFICAL ABOUT IT.

NOW IT’S PEPSI, FOR THOSE WHO THINK YOUNG

25


THE CHOICE OF NEW GENERATION

“YOU GOT OF THE RIGHT ONE BABY”

“A GENERATION AHEAD”.

“NOTHING ELSE IS A PEPSI”

A Tale of Pepsi Co’s Strategy and Structure:

Pepsi Co. And the coca-cola Company is to of the largest and oldest archrivals in the
carbonated soft drinks industry. The war between the soda giants, also known as the
“cola wars”, initiated in the 1960s when Coca-Cola dominance was being increasingly
challenged by Pepsi-Cola. The competitive environment between the rivals was
intense and well publicized, forcing the Pepsi Company to continuously establish and
implement strategic changes as a means to create a competitive advantage.
Furthermore both Pepsi and coke offered a limited number of products that “looked
the same, tasted the same, and bubble into foam the same “thus, questioning whether
further substantial growth in sales was possible.

Rather than succumbing to the impending maturation of its domestic market, the
Pepsi company as a leader, fostered by the competitive intensity, launched new
strategies, such as product modifications, new forms of pricing and promotion, and
fundamental changes in its distribution system, that have led to rapid and continued
expansion of the company’s domestic sales. By forecasting and responding to changes
in the economic, political, social, and technological environment, Pepsi has
successfully innovated in marketing, distribution, and product development. The soda
rivalry also initiated Pepsi Company to seek international markets and diversification
strategies in order to increase its sales growth.

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“To be the World’s Premier Consumer Products Company focused of convenient
foods and beverages. In every thing we do we strive for honesty fairness and
integrity”.

PepsiCo is a world leader in convenient foods and beverages, with 2004 revenues of
more than $29 billion and 153,000 employees. The company consists of Frito-Lay
North America, PepsiCo Beverages North America, PepsiCo international and Quaker
Foods North America. PepsiCo brands are available in nearly 200 countries and
territories and generate sales at the retail level of about $78 billion.

Many of PepsiCo’s brand names are more than 100-years-old, but the corporation is
relatively young. PepsiCo was founded in 1965 through the merger of Pepsi-Cola and
Frito-Lay. Tropicana was acquired in 1998 and PepsiCo merged with the Quaker oats
company, including Gatorade, in 2001.

PepsiCo offers product choices to meet a broad variety of needs and preference from
fun for-you items to product choices that contribute to healthier life styles.

PepsiCo is among the world’s largest food and beverage companies. Our businesses
include: Frito-Lay, the world’s largest manufacturer and distributor of snack chips;
Pepsi-Cola, the world’s second largest beverage company; Tropicana, the world’s
largest marketer and producer of branded juices; Gatorade, the world’s leading sports
drink and Quaker, a leading manufacturer and marketer of cereals, rice and pasta and
other grain-based products. PepsiCo brand names are among the best known and our
operations reach every corner of the world. As a consumer products company, and
important environmental challenge facing all our divisions is the packing generated
by our products, packaging is important to public health and safety and is critical
component of the destitution system that delivers products to consumers and
commercial establishments. To meet these needs and safeguard the environment, we
follow the Environmental Protection Agency’s (EPA) approach of Reduce, reuse and
recycle.

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Each business also strives to be responsible in its use of resources in
manufacturing and distributing our products. This report covers our environmental
commitment, the principles we follow, and progress at each of our businesses.

PepsiCo’s Environmental commitment
PepsiCo is committed to providing safe and healthy work environments and to
being an environmentally responsible corporate citizen. It is our policy to comply
with all applicable environmental, safety and health laws and regulations.
We believe that protecting the environment is an important part of good
corporate citizenship. We are committed to minimizing the impact of our businesses
on the environment with methods that are socially responsible, scientifically based
and economically sound. We encourage conservation, recycling and energy use
programs that promote clean air and water and reduce land fill waste. PepsiCo World
Wide code of conduct.

SHAREHOLDERS
PepsiCo (symbol: PEP) shares are traded principally of the New York stock
exchange in the United States. The company is also listed on the Amsterdam,
Chicago, Swiss and Tokyo stock exchanges. PepsiCo has consistently paid cash
dividends since the corporation was founded.

CORPORATE CITIZENSHIP
At PepsiCo, we believe that as a corporate citizen, we have a responsibility to
contribute to the quality of life in our communities. This philosophy is expressed in
our sustainability vision which states: “PepsiCo’s responsibility is to continually
improve all aspects of the world in which we operate- environment, social, economic-
creating a better tomorrow than today”.

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Our vision is put into action through programs and a focus on environmental
stewardship, activities to benefit society, and commitment to builds shareholder value
by making PepsiCo a truly sustainable company.

PEPSICO HEADQUARTERS

PepsiCo world headquarter is located in New York City. Edward Durrel Stone, one
of America’s foremost architects, designed the seven- building headquarters complex.
The building occupies 10 acres of a 144 acre complex that includes the Donald M.
Kendall sculpture Gardens, a world-acclaimed sculpture collection in a garden setting.

The collection of works is focused on major twentieth century art, and features works
by masters such as Auguste Robin, Henri Laurens, Henry Moore, Alexander Calder,
Alberto Giacometti, Arnaldo Pomodoro and claes Oldenberg, the gardens originally
were designed by the world famous garden planner, Russell Page, and have been
extended by Francois Goffinet. The grounds are open to the public, and a visitor’s
booth is in operation during the spring and summer.

FRITO-LAY NORTH AMERICA
PepsiCo’s snack food operation had their start in 1932 when two separate events took
place. In San Antonio, Texas, Elmer Doolin bought the recipe for an unknown food
product – a corn chip and started an entirely new industry. The product was Fritos
Brand Corn chips, and his firm became the Frito Company.

That same year in Nashville, Tennessee, Herman W. Lay started a business disuniting
potato chips. Mr. Lay later bought the company that supplied him with product and
changed its name to H.W. Lay Company. The Frito Company and H.W. Lay
Company merged in 1961 to become Frito-Lay, Inc.

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Major Frito-Lay products include Lay’s Potato chips, Doritos flavored tortilla chips,
Tostitos tortilla chips, Cheetos cheese flavored snacks, Fritos corn chips, Ruffles
Potato chips, Rold Gold Pretzels, Sun chips multigrain snacks, Munchies snack mix,
Lay’s Stax Potato crisps, Cracker jack candy coated popcorn and Go snacks.

Frito-Lay also sells a variety of branded Chips, Quaker fruit and oatmeal bars, Quaker
Quakes corn and rice snacks, Grandma’s cookies, nuts and crackers.
Frito-Lay North America includes Canada and United States.

RECYCLE
 All Pepsi-Cola containers are designed for easy recycling and more than half
are recycled, making soft drink containers the most recycled packaging in the
United States.
 Pepsi-Cola is working with suppliers and bottlers to develop a PET (poly eth
1-eneterephthalate) bottle that contains 10% recycled content. Pepsi-Cola PET
plastic bottles will include 10% recycled content by 2005. We are currently
conducting tests with suppliers on the safety of 20 ounce and 2 liter plastic
bottles containing various recycled resins. We are developing a sensory
protocol for Pepsi-Cola bottles containing recycled plastics.
 In the United States, 48 million Pepsi-Cola aluminum cans are recycled each
day. In Canada, over 50% of soft drink containers are recycled, and this
continues to rise.
 Over the years Pepsi-Cola has made the plastic PET bottles more easily
recyclable in the United States, Canada Europe and elsewhere. Pepsi-Cola
eliminated base cups in most markets, switched to polypropylene caps instead
of aluminum metal caps, and paper contamination.
 In U.S. and Canadian bottling plants, packages damaged during filling are
collected and recycled glass, plastic and aluminum. Many plants also recycle
used packaging from incoming materials corrugated packages, straps from
pallets, etc. This has reduced plant waste by 50%-75% avoiding disposal costs
and land filling.
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 Pepsi-Cola established one of the first programs in the country to collect and
recycle the plastic ring connectors from six packs. Since then the company has
established similar programs with its supplier, HiCone, at over 10,000 schools
across the country. Many of the Pepsi-Cola bottling partners have established
programs to recycle ring connectors collected after filling vending machines
with cans. And if some consumers do litter, North American ring connectors
are photo degradable and have a “breakaway “ pull tab so the can be easily
separated , minimizing any impact on wildlife.

QUALITY POLICY:
Make Sell and Deliver the Beverages to the consumer has it was designed, in order
to drive brand preference.

SAFETY PRINCIPLES IN THE COMPANY:

We believe that safety health and environmental excellence is fundamental to
demonstrating the values of the right side up company in all our operations.

Through a fully empowered Pepsi-Cola organization, it is the job of every individual
at Pepsi-Cola to be conscious of and strive towards protection of safety, health and the
environment in our operating procedures and in the design of our facilities and
equipment. We will rely on an integrated process that places value on individuals,
exceeds performer and customer expectation and increases the value of our company.
We intend to sustain safety health and environmental process that will prevent
injury and property damage, protect against loss by fire and provide security for our
assets. It is the obligation of every one at Pepsi-Cola to comply with all applicable
safety health and environmental laws.
Ongoing monitoring of these activities will take place in order to ensure that we hold
our self accountable for safety, health and environmental excellence.

QUALITY ASSUARANCE:

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Perhaps the most important in a bottling plant are those concerned with the
maintenance of the standards of purity and uniformity set for the beverages
produced. Those activities can be grouped together under the heading of
quality assurance.

To get the top most quality of the product, all the ingredients such as water,
CO2, concentrate are strictly inspected and analyzed by our quality assurance
department. Apart from raw material, online sampling finished products are
also tested.

Samples of beverages produced are picked from the market for testing by
independent laboratories of international repute.

MAJOR PLAYERS AND MARKET SHARES

The two global majors Pepsi and Coca-cola, Which had winded up its India
operations during the introduction of the FERA regime, reentered India 16 years later
in 1993, dominate the soft drink market in India. Coca-cola acquired a major chunk of
the soft drink market buying out local brands thumps up, limca and gold spot from
Parle beverages. Coca cola has also acquired Cadbury Schweppes soft drinks brands
crush, Canada dry and sport Cola in early 1999.Pepsi although started a couple of
years before Coca-Cola in 1991,has a lower market share today. It has bought over
Mumbai based duke’s rang of soft drink brands both the cola manufacturers come up
with their own market share figures and claim to have increased their share.

Segmentation
The soft drink market can be segmented on the basis of place of consumption or
on the basis of type or products. The segmentation on the basis of place of
consumption divides the market into parts.

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• On-premise -80% of the consumption of the soft drinks is on premise i.e.
restaurants, sweet marts, railway station, cinema theaters etc.
• At home-the rest of 20%of the market comprises of the soft drinks purchased for
consumption at home.
• The market can also be segmented o the basis of types of products into cola
products and non-cola products.
• Cola products account for nearly 62-65% of the total soft drinks market. The
brands that fall in this category are Pepsi, coca-cola, thumps up, diet coke, diet
Pepsi etc.
• Non-cola segment, which constitutes 36%, can be divided into four categories
based on the types of flavors available, namely:
Orange
Cloudy Lime
Clear Lime
Mango

i) Orange flavor based soft drinks constitute around 17% of the market.
The segment is largely dominated by national brands like Fanta of coca-
cola and Mirinda orange of Pepsi Co, which collectively forms 15% of
the market, rest of the market is in hands of smaller brands like crush,
Gold Spot etc.
ii) Cloudy Lime flavors constitutes of 14% of the market and is largely
dominated by Limca of coca-cola and mirinda Lemon of Pepsi Co,
Limca is the market leader with around 70-75% of the market Followed
by Mirinda Lemon.
iii) Clear lime: this segment of the market witnessed good growth initially
with all the players launching their brands in the segment.
iv) Mango: this flavor segment constitutes 2% of the total soft drinks market
and it directly it completes with mango based fruit drinks like Frooti.
The leading brands in these segments are: Maaza of coca-cola, and slice
of Pepsi.

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DIFFERENT IMAGES OF PEPSI COMPANY
Here are some different images that the Pepsi Company have been following.

HISTORY
Pepsi has one of the most intriguing histories of any product on the market.
From it’s humble beginnings the people of Pepsi make the story what it is –including
its inventor, customers, competition, corporate managers, salesman, distributors,
cartoon spokes-persons and including some of the biggest names in entertainment

34


history. There have been good times and bad times- plus lots and lots of changes over
the years. If you enjoy Pepsi, you’ll enjoy the stories of the people who have made it
possible. People
Today
Pepsi is one of hundreds of products manufactured by the PepsiCo Corporation.
Pepsi Co is a world leader in world leader in convenient foods and beverages, with
revenues of about $27 billion and over 1, 43,000 employees. The company consists of
the snack businesses of Frito-Lay North America and Frito-Lay international, the
beverage businesses of Pepsi-cola North America, Gatorade/ Tropicana North
America and Pepsi Co Beverages international, and Quaker Foods North America,
manufacturer and marketer of ready-to-eat cereals and other food products.

.

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ORGANIZATION STUDY
Nectar Beverages Pvt. Ltd, Dharwad.
Nectar Beverages Pvt. Ltd, Dharwad is a franchisee of Pepsi Co. Late Shri
founded it. Madhubab Timblo, Prominent Industrialist and business entrepreneur of
Goa in 1984.
Nectar Beverages belongs to big house of Goa, under the banner for Formento
Group. The group deals in Hotel, Soft drinks and 100 % F. O. Us of Mining in Goa,
Karnataka and Andhra. It is headed by Mr. Prashanth Timblo, the idea son for the
illustrious father late Mr. Madhubab.

Nectar Beverages has carved a special niche in the map of soft drinks in the
country. Thus enjoys the highest reprobation in the soft drinks market for quality
products of international brand such as Pepsi, 7up, Miranda (orange),

36


Miranda(lemon), evervess soda, slice etc Utmost care is being taken from the
beginning of collection of the raw water till it turns it into a sophisticated flavor drink.

MAHAKOSHAL NECTAR BEVERAGES PVT.LTD DHARWAD
It is started in the year 1996. Mahakoshal is a sales department of Pepsi
Company, Dharwad. It consists of a 25 employees In sales department and they
are covering 15 districts, 70 stockiest. Mahakoshal consists of 10 acres of land.
In production and administration line consists of 50 permanent workers, 100
seasonal worked and 30 staff executives. The company is giving festival offers
to the employees 8.33% bonus and every year two uniforms (pants and shirts)
including shoes and caps. and also marriage loan. Housing loan, children’s
marriage loan 2500 for festival loan 2500 for festival loan to be given. On the
basis of monthly wages is paid to the workers. He is permanent or seasonal.
Mahakoshal annual turnover is 12 to 15 crores and 13 lakhs creates. And also
they are giving daily morning and evening two times tea and two biscuits in the
organization.

The company has 100 small and big vehicles on contract basis. In Dharwad has
a distributor is responsible for distributing retailers, bars, hotels, cold drink house etc.
the Nectar Beverages pvt. Ltd is started in the year of 1985. 40 to 45 percent market
share from north Karnataka.

MISSION
- To achieve every batch incoming raw materials are checked for quality by
quality assurance departments.
- Using high grade sugar.
- The online and final product checks are carried out at regular intervals.
- To purchase raw materials only from approved sources, approved by
- Using equipments of superior grade stainless steel material.

37


- To give special attention to
-Personnel hygiene and sanitation
-House Keeping
-Good manufacturing process.
- To give special attention to keep the Factory Surroundings Clean and Green
by growing Lawn.

MANUFACTURING PROCESS OF CARBONATED DRINK
WATER AND WATER TREATMENT
Pure water is taste less, color less and odor less. Water as it occurs in nature,
whatever the source, always contains impurities in solution are in suspension. The
determination of these impurities makes water analysis necessary and the control of
these impurities makes water conditioning essential.
The various sources of water can be classified as rain water, surface water and
ground water. Irrespective of the source of the water, the water has to be tested and
treated before taking in to the production.

TESTING AND TREATMENT PROCEDURE ADOPTED AT M/S. NECTAR
BEVERGES Pvt. Ltd. DHARWAD

The source of water at Nectar Beverages Pvt. Ltd. is ground water. The water
is tested for various parameters like, hardness, alkalinity, suspended impurities, and
micro organisms.

TREATMENT PROCEDURE
There are two types of water treatment adopted at nectar beverages Pvt. Ltd,
1. Chemical batch treatment: This water is used for beverage purpose.
2. Ion exchange: This water is used for boiler feed water, cooling tower, D.G.
sets, condenser, heat exchanger and bottle washer.

1. CHEMICAL BATCH TREATMENT PROCESS

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Here the raw water is collected in storage tanks and dosages for chemical
treatment are given according to the characteristics of the raw water. The source of
raw water is bore wells.
At present N.B.P.L. is holding three water treatment storage tanks, out of
which two tanks are of 3,00,000 liters capacity and one is 4,00,000 liters capacity.
Raw water is collected from bore wells in the storage treatment tanks and
analyzed the characteristics of raw water such has P-alkalinity, M-alkalinity,
temporary hardness and calcium hardness, afterwards chemical dosages are fixed.
After addition of chemicals, the water is stirred by mechanical agitator, and three
hours contact period is given before taking the water for production.
Treated water passed through the sand filter to remove any floe carry over,
then an activated carbon filter which removes chlorine and off taste/ odor causing
impurities. Finally it goes through 5 micron pore size polishing filters to remove any
carbon that may have been carried out over from the carbon purifier, and then through
ultra-violet. Chlorine concentration is maintained at 6-8 PPM level before carbon
filter and 2 hours contact time prior to dechlorination.
Details of Chemicals Used
1. Lime: Added to remove alkaline compounds from water to an acceptable level
and to reduce temporary hardness.
2. Bleaching Powder: Added for chlorination to oxidize microorganisms.
3. Ferrous Sulphate: Added for coagulation and flocculation i.e., to remove the
suspended solids and also insoluble materials created by chlorination and
alkalinity reduction is removed.

The sludge is drained and the treatment tanks cleaned with water after every treatment
and fresh raw water is taken for fresh treatment.

2. ION EXCHANGE METHOD
Source of water- bore well.
Liquid hypochlorite is injected in to the online water flowing from bore well to raw
water tanks.

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Once the raw water is chlorinated, after giving sufficient contact time, the
water is passed through sand filter, carbon filter and resin bed. Then the soft water is
stored in soft water storage tanks. Before the water goes into the storage tanks, 2
PPM of chlorine is injected in to the on-line water flowing from softener to soft water
storage tanks. Contact time in storage tank is minimum 2 hrs. Then the water from
the tank is being pumped on it passed through 5 micron pore size polishing filters to
the bottle washer/boiler. The concentration of chlorine at the final outlet will be
around 2 PPM.

SWEETENING AGENT AND SYRUP PREPERATION
Sweetening agents are those subsistence’s, which when blended with flavour,
acid etc. will provide satisfactory sweet taste in the finished beverages. They also
furnished body, which helps to carry or transits the flavour. They also give energy or
food value to the beverage.

SYRUP PREPERATTRION
The preparation of the syrup is certainly one of the most important operation
in the beverage plant, both from the stand point of sanitation and control of
concentration. The object in syrup making is to prepare satisfactorily bended and
finished syrup from which uniform beverages of high quality can be produced.
Normally required quantity of sugar of high quality is added to treated water
and heated to 850 C, in a high grade stainless steel double jack vessel. Activated
carbon is added to this to remove impurities. Impurities along with activated carbon
added to the sugar are separated form the sugar solution by filtering the sugar syrup.
Filter paper and Hyflo Supercel are used as filter aid. The temperature of the clear
syrup thus obtained is brought down to 200 C and stored is called “Simple” syrup.
When the syrup is completely prepared by the addition and blending of all
flavorings ingredients it is called as “Ready”/ “Finished” / Flavored syrup. The syrup
is ready for use in production process.

CO2 AND CARBONATION

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The CO2 used for beverage purpose are 99.9% pure, free from moisture, air,
oil, grease and other impurities.
The amount of CO2 dissolved in solution is called as volumes. The number of
volumes of gas in the finished beverage has a definite relationship to the taste of the
beverage. Correct carbonation means a sparkling, stimulating, thirst quenching
beverage that completely refreshes and satisfies the consumer. Since there is definite
relationship between taste and carbonation, it is extremely important to determine and
maintain the carbonation which has proved most acceptable through experience in
consumer section.
The technique adopted at M/S. N.B.P.L for carbonating the beverage is as
under:
The ready syrup, which is prepared and stored in ready syrup tank, is taken to
the bottling line. It is passed trough a machine called ‘premix’ where the syrup is
automatically diluted with treated water to the required level. Once it is diluted it is
sent to the carbonator for carbonation.
For carbonating the beverage a mechanical device known as
“CARBONATOR” is used. CO2 gas enters the carbonator through a valve at the top
of the body of the carbonator. The dome as well as the body of the carbonator is
filled with gas. Syrup is sprayed in to the carbonator from the top, which flows down
through the baffle plates provided inside the carbonator. As the water flows down it
gets mixed with the CO2 gas present inside the carbonator.
Carbonation can best be obtained by increasing the pressure inside the
carbonator vessel and by pre-cooling the syrup before it is pumped to the carbonator.
Low gas volume product need not be pre-chilled.

CONCENTRATES
Flavorings materials used in making carbonated beverages are primarily are
alcoholic extracts, emulsions, alcoholic solutions or fruit juices.
Concentrates or non-alcoholic beverage bases are supplied by N.B.P.L’s
principle company from channo (Punjab) having international standards. On addition
of concentrate to the simple syrup we get respective finished syrup ready for further
process to bottle beverages.

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BOTTLE WASHING AND BOTTLE INSPECTON
One of the most important aspects of the bottling operation is the cleaning of
the reusable bottles when it returns to the bottling plant. In order to be reused the
bottle must be sterile, of acceptable appearance, rinsed free of any detergent of
sterilizing agent, and of good mechanical strength.
The object of bottle washing is to produce both a clean bottle and sterile one.
The fact that bottle looks clean does not indicate it is sterile, and on the other hand, a
dirty looking bottle may be a sterile one.
The present day bottle washer is designed to both clean and sanitize bottles
before sending them to the filling line.

BOTTLE WASHING COMPOUNDS
Members of the alkali family of chemicals make up the basis of most bottle
washing compounds. Caustic soda is the principle ingredient because it has by far the
best germicidal properties.
Three factors are crucial in the germicidal efficiency of the washer. These are:
Contact time, caustic strength and temperature.

OPERATIONS OF THE BOTTLE WASHER
1. The first step in the operation precedes the washer. When the cases of empties
return to the bottling plant, they must be sorted and culled to remove
especially dirty bottles, of ones contaminated with paint, tar, etc, or chipped or
broken bottles. This operation is often done by hand.
2. The inspected bottles are feed into the bottle washing machine; automatically.
The bottles are turned up side down to drain any contents and given a pre rinse
spray wash both internally and externally with plain water with certain
pressure. This operation is called pre rinse operation. Then the bottles are
moved to pre wash compartment, where the bottles are spray washed both
internally and externally with 1 to 1.5% caustic solutions @45 0 C to 550C
temperature.

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3. Bottles are then, moved into a tank in the bottle washing machine, where the
bottles are soaked with caustic solution of 3 to 3.5% @750 C temperature. To
get this best results that bottles are to be soaked in this compartment for a
minimum of 7 minutes at the caustic strength and temperature given as above.
This operation cleans and sterilizes the bottle.
4. Then the soaked bottles are moved to a compartment called “Hydro”, where
again the bottles are given spray wash both internally and externally with 1 to
1.5% caustic wash @ 500 to 550 C.
5. Bottles are moved to compartment called pre-final compartment where again
the bottles are given spray wash with soft water to remove the caustic traces.
Here the temperature is maintained around 400 to 450 C.
Finally bottles, free from caustic moved to a compartment called final rinse
compartment where the bottles are again, waited sprayed both inside and out
side with soft water to deliver a clean and sanitary bottles to the conveyor
enrooted to filler at ambient temperature.

Before the bottles moved through the conveyor, the bottles are subjected to
ethylene blue test to ensure the bottles are free from mold and as also tests are
carried out to determine whether the bottles are free from caustic traces.
These tests are done at random.
Then the washed bottles are moved through conveyor to filler for filling
operation.
Before the bottles are moved to filler the bottles are subjected to visual
inspection. This is called bottle inspection.

BOTTLE INSPECTION
The clean bottles undergo inspection after they leave the washer and before
they arrive at the filler. Inspection can be done visually by an individual. It is a job
requiring a great deal of concentration and no individual can be efficient for long
stretches at a time. Provision should be made for changing inspectors frequently, and

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adequate bright diffused light should be provided which illuminates all parts of the
bottle effectively, but does not glare in the operator’s eyes.
A receptacle should be provided, convenient to the inspector for non-usable
bottles, and cases should be handy to accumulate unclean bottles for rewashing.
Those bottles found acceptable to the empty bottle inspector are sent for filling and
crowning.

FILLING AND BOTTLING LINE
The bottles, on a suitable conveyor line arrive at the rotary filler, which is equipped
with filling heads. The beverage filling unit includes a filling tank, which receives
beverages from the carbonator.
The tank is also connected to the gas chamber of the carbonator. This connection
insures balanced pressure and a proper beverage level in the tank.
On entering the head, the bottle is sealed to the filling valve and a counter pressure is
established in the bottle. At this point, the pressure inside the bottle is equal to and
derived from the filling tank.
Once the bottle is properly pressurized, carbonated water flows in displacing air and
CO2 in the bottle. The displaced gas passes through the counter pressure lines back to
the top of the filler tank.
When the proper level of beverage in the bottle is reached, the supply is cut off and
the top gas pressure in the bottle is shifted to the atmosphere.
Once the top pressure has been released, the bottle is removed from the valve and
passes through the crowner.
The crowning unit consists of the hopper for holding the crown supply, a crown chute
and the crowning mechanism. The crowned bottle then moves from the crowner on to
the out feed conveyor.
FINAL INSPECTION POINT
Then the sealed bottles are moved on a conveyor line and it is subjected to a
final inspection. Where the inspector checks for un crowned bottles, over/under filled
bottles, foreign matter (if any), and for any other visual defects.
Once the inspector satisfies with the quality of product and package, he allows
moving the bottles further to the collection table, where the bottles are manually

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collected and put in the crates of 24 bottles and moved further for warehousing, and
awaitingshipment.

PLANT SANITATION
The most scrupulous sanitation practices are essential in soft drink plant. The
highest standard of cleanliness for premises, personnel and equipment is obviously
necessary due to the type of operation involved that of manufacturing a food product.
Sanitation is necessary to insure the keeping qualities, proper appearance and
full flavour of any soft drink. When the equipment becomes contaminated, yeast,
bacteria or mold microorganisms begin to appear in the finished beverage. Increased
numbers of these microorganisms will cause the development of undesirable tastes
and odors and ultimate spoilage of the product. Nothing will kill the demand for a
beverage any quicker than off-tastes and odors or product spoilage.
Hence sanitation, good plant house keeping and good manufacturing practice
are strictly implemented at N.B.P.L.

QUALITY ASSSURANCE:
Perhaps the most important activities in bottling plant are those concerned
with the maintenance of the standards of purity and uniformity set for the beverages
produced. These activities can be grouped together under the heading of quality
Assurance.
To get the too most quality of finished product, all the ingredients such as
water, sugar, CO2, concentrate are strictly inspected and analyzed by N.B.P.L Quality
Assurance Department. Apart from raw materials, on line sampling, finished products
are also tested.

Samples of beverages produced are picked up from the market for testing by

EFFLUENT TREATMENT PLANT
The effluent water charged by N.B.P.L is properly treated and neutralized to
maintain a value of C.O.D., B.O.D., pH and T.D.S in water as per the guidelines

45


prescribed by the Water Pollution Board of Karnataka. For this N.B.P.L has full
fledged effluent treatment plant.

MARKETING MIX
Product
Quality
Features
Options
Designs
Styles
Brand Name
Packaging
Size, Color, Service
Guarantee
Warranties

Place
Channels
Coverage
Locations
Inventory
Transport

Price
List Price
Discount
Payment Period
Credit terms
Promotion
Advertising
Personal selling
Sales Promotion

46


Publicity

FOUR P’S .OF PEPSI COMPANY
Management of the company must design a marketing mix the
combination product, place, price and promotion. These four elements must together
satisfy the needs of the organization target market and at the same time , achieve its
marketing objectives.
1. PRODUCT:
Strategies are needed for managing existing products overtime adding
new ones and dropping failed products. Strategic decisions must also be made
regarding branding, packaging and other product related features such as warranties
guaranties.

Pepsi company product information:
Pepsi Company as a Multi National Company has got enormous number of
products since from its beginning it has got a list of thousand together products in its
basket. But it is not operating in all the countries with all the products. Because all
Pepsi product may not be suitable for the people of every country so by keeping this
in mind the Nectar Beverages Pvt. Ltd , Dharwad manufacturing only some
products namely: Pepsi ,Blue Pepsi, Mirinda orange , Mirinda Lemon, Mountain Dew
,Slice , 7-up, Lehar-soda.
But the Pepsi company’s present leading brands are Pepsi,7-up, Mirinda
orange.In India it is manufacturing only some products viz.

SEGMENT PRODUCTS
COLA PEPSI
ORANGE MIRINDA
CLEAR LEMON 7UP, MOUNTAIN
CLOUDY LEMON DEW
MANGO TEEM MIRINDA
SODA SLICE
EVERVESS

47


The above products are available in different bottles sizes and pet packs i. e ,
200ml ,300ml,500ml,1liter,2liter.
Since from the launch of 200ml(mini ) Pepsi products in the market it is
moving very fast in the market place than any other quantity bottles and pet jars , even
it has over taken the sales of 300ml bottles as forecasted.

2. PRICE:
Price is the most important element of marketing mix. Price is determinant
factor for the success or failure of any organization .A pricing strategy is must for
entering in to new market or with new product Pepsi products price have been
changing season wise and even place wise .Recently company reduces the prices of
200ml Pepsi products to Rs 5/- in the month March/ April 2006, Pepsi company has
taken a strategic decision by reducing the price of 300ml Pepsi products up to Rs 6/-
in North Karnataka only but earlier it was Rs 8/- for 300ml bottle.

3) PLACE OR DISTRIUTION:
Here the strategies involve the management of channels by which ownership of
product is transferred from producer to customer, in many case the system by which
goods are moved from where they are produced to where they are purchased by the
final customer.
In Nectar Beverages Pvt, Ltd. They have appointed the stockiest for their
products at different places in North Karnataka (i.e. in 13 districts). In turn these
stockiest are distributing the cold drinks to retailers and again these retailers are
selling these soft drinks to end users.

4) PROMOTION
Promotion activities are must for every organization. It creates a basic
platform for moving the company products. Sometimes promotion activates play a
crucial role. With ought it products / services cannot move themselves: it includes
advertisement, personal selling, sales promotion and publicity.

48


Pepsi Company is trying to raise its penetration by offering name boards, stands
for keeping the products, money to some shop keepers for interior decoration,
Refrigerators, trade discounts, cash discounts, credit facilities,
Pepsi has laced it self as new generation drink. Pepsi focused on youth spontaneity
irreverence as its brand personality. Pepsi ads have a elements of surprise a originally.
The selling plats form being cricket, music, and films.

49


ORGANIZATION CHART:

NECTAR BEVERAGES Pvt. Ltd.

Resident director (CEO)

GM Manager Manager Manager
(Plant) (Finance) (HR) (Territory
developmen
t)

Assistant Executive Executive Executive
Manager HR Administrator General

Executive Assistant Clerk
Accountant

Shipping Store Manager Manager Manager
(Executive) (Executive) (Production) (Maintenance) (Quality
Control)

Executive Customer
(Quality (Executive)
Control)

Customer Area Sales
Executive Manager

50


Total Employment of N.B.P.L:

CEO : 01

Managers : 05

Executives : 36

Staff : 09

Permanent Workers : 50

Temporary Workers

Non Seasonal: 30
Seasonal : 120

HEADS DEPARTMENTS OF N.B.P.L.
1. Human Resource Department : Mr.R.A.Baakale
2. Sales and Marketing Department : Mr.Ranjit Morey
3. Finance Department : Mr. K.Chetan
4. Production Department : Mr.M.A.Pritviraj

MARKETING CHANNELS
There are two types of marketing channels:
1. Consumer marketing channels.
2. Industrial marketing channels.
N.B.P.L. Pepsi Co. is a Fast Moving Consumer Goods (FMCG) Company
which comes under consumer marketing. So this consumer marketing channel
includes four levels of channel they are,
a. 0-level channel
b. 1-level channel
c. 2-level channel
d. 3-level channel

51


CONSUMER MARKETING CHANNEL OF N.B.P.L PEPSI CO.

2-LEVEL CHANNEL

MANUFACTURER

WHOLESALER

RETAILER

CONSUMER (End User)

The 2-Level channel is company to manage the business and reduce the high
risk adopts the most suitable marketing channel for N.B.P.L PEPSI CO. this channel.
In this channel company main work is to manufacturing the products and
promoting the products to the wholesalers. Here the wholesaler is the main key for the
company’s business growth.
This channel makes it easy for the customers to purchase product, but by
providing greater service output which increases channel costs and there by increases
prices for customers.
So 2-level channel which correlates with company’s market functioning.

FUNCTION OF MARKETING CHANNEL

52


A marketing channel performs the work of moving goods from producers to
consumers. And its key functions are;
 It gathers information about potential and current customers, competitors, and
other factors and forces in the marketing environment.
 It develops and disseminates persuasive communications to stimulate
purchasing.
 It reaches agreements on price and other terms so that transfer of ownership or
possession can be affected.
 It place orders with manufacturers.
 It acquires the funds to finance inventories at different levels in the marketing
channel.
 It assumes risks connected with carrying out channel work.
 It provides for the successive storage and movement of physical products.
 It provides for buyers payment of their bills through banks and other financial
institutions.
 It over sees the actual transfer of ownership from one organization or person
to another.

MARKET SHARE
DHARWAD 58%
HUBLI 60%
BELGAUM 50%
HAASAN 99%
DAVANGERE 87%
MADHURAI 88%
BIJAPUR

TASK ENVIRONEMENT:

53


A. Markets:
The major market segments are
- Bars and wine centers.
- Students in soft drinks houses, restaurants, convenience stores.
- Families that like to store pet bottles.

C. Competitors:
The major competitor is Coca-Cola along with local/unorganized sector.
Pepsi Co. Brands Coca Cola’s Brands
Pepsi Coke
7-up Thums up
Mountain Dew Sprite
7up Ice Citra
Mirinda Orange Fanta
Mirinds Lemon Limca
Slice Maaza
Evervess Soda Kinley(water)
Teem Soda
Aquafina (water)
Tin
Duke Soda
Diet Pepsi

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D. Distribution and dealers:

The three main channels to reach the consumers are
s
Production Unit

Distributor Distributor

convenience Groceries Restaurants
Store -General -Bars
C: stores -Cool drink house
Pan shops -Restaurants
Bakeries -Canteens Empty
Theaters

Consumers

E. Suppliers:

55


The suppliers are of bottles, caps, openers, posters, advertising boards, sugar,
flavors etc.

F. Facilitators and marketing firms:
The transportation and ware housing is outsourced.
Pepsi Co has excellent advertising agency. It is rated as top 3rd brand in India after
ITC.

G. Publics:
Teenagers and alcoholics form major opportunities.

RESEARCH DESIGN
After defining the problem. The research design is a plan specifying the
sources of collection of data and analysis of needed information, data collection
sources and comprise of both primary and secondary data.
-Selection of data collection.
Primary data : In depth interview
Questioners
Interaction
Secondary data : Internet

- Selection of measurement technique.
Quantitative analysis, pie charts
- -Primary considerations in sampling.
-Population : retailers
-sample frame : all the retailers in Hubli-Dharwad.
-sample size : 100

-Method of analysis : Quantitative

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-Ethical Aspects : I have made and effort to make this work free
from personal opinions and likings.

THEORETICAL BACKGROUND FOR THE PROJECT

As marketing is a process, which starts with customer and ends with customer. But in
between this process retailer plays an important role in affecting the buying decision
of customer, which is indirectly affecting the sale. So my intension is to find out the
percentage by which retailer can be satisfied to maximum extent. So that sales and
brand image of company can be increased.

Previously the manufacture used to make a product and sell it to the customer without
giving any importance to retailers. In case of beverage industry also the scenario has
totally changed. There is much competition. After that competition is increased. Then
company realize the importance of retailer and his needs and what he except from the
company product. Company has begun to invest on research to understand and what is
the perception of retailer about various policies by company.

Utility of the project:
 To know the expectation of the retailers among the Pepsi products
 To know the average sale of Pepsi products.
 To know the company promotional activities.
 To know the retailers satisfaction level towards the Pepsi product.
 To know the retailers complaints regarding the price and availability of
Pepsi products.

 To study or know the reasons for purchasing the Pepsi products.

57

A project report on various policies of pepsi toward retailers mba marketing

A project report on various policies of pepsi toward retailers mba marketing

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A project report on various policies of pepsi toward retailers mba marketing