A STUDY ON DISTRIBUTION CHANNEL IN PEPSI

With reference to Lumbini Beverage pvt.ltd, Visakhapatnam

A Project Report submitted in partial fulfillment of the requirement for the award of degree in MASTER OF BUSINESS ADMINISTRATION

By P.Avinash (Regd No: 1225112235)

Under the esteemed guidance of Dr.B. NALINI (Assistant Professor)

GITAM INSTITUTE OF MANAGEMENT GITAM UNIVERSITY VISAKHAPATNAM (2012-14)

DECLARATION

I hereby declare that this project report entitled Distribution channel in Pepsi with special reference to Lumbini Beverage Pvt.Ltd, Visakhapatnam, submitted by me to the College of GITAM INSTITUTE OF MANAGEMENT, Visakhapatnam, in partial fulfillment of the award of the degree of Master of Business Administration. I also declare that this project work is the result of my own effort and has not been submitted to any other university/institution for the award of any other Degree/Diploma, fellowship or similar titles.

Visakhapatnam Date

P.Avinash Regd.No: 1225112235

CERTIFICATE

This is to certify that this project entitled DISTRIBUTION CHANNEL IN PEPSI with special reference to Lumbini Beverage Pvt.Ltd , Visakhapatnam is a bona fide work submitted by Mr.P.Avinash in partial fulfillment of the requirements for the degree of Master of Business Administration to College of GITAM INSTITUTE OF MANAGEMENT,GITAM UNIVERSITY, VISAKHAPATNAM

Dr.B.NALINI PROJECT GUIDE

PREFACE
There is a famous saying The theory without practical is lame and practical without theory is blind. This modern era is era of consumers. Consumers satisfy themselves according to their needs and desires, so they choose that commodity from where they extract maximum satisfaction. It has been identified that in the beginning of 21st century the market was observed a drastic change. The successful brand presents itself in such a way that buyers buy them in special values which match their needs. Marketing is an important part of any business and advertisement is the most important part of marketing. Summer training is an integral part of the PGDM and student of Management have to undergo training session in a business organization for 6 weeks to gain some practical knowledge in their specialization and to gain some working experience. Our institution has come forward with the opportunity to bridge the gap by imparting modern scientific management principle underlying the concept of the future prospective managers. To the emphasis on practical aspect of management education the faculty of Academy of Management Studies, Gitam has with a modern system of practical training of repute and following management technique to the student as integral part of PGDM. in according with the above obligation under going project in Lumbini Beverages Pvt. Ltd. Vizag. The title of my project is A Brief Study of Effectiveness of Channel of distribution of Pepsi product in Vizag Certainly this analysis explores my abilities and strength to its fullest extant for the achievement of organization as well as my personal goal.

ACKNOWLEDGEMENT

I want to render my acknowledgement to the following distinguished persons who helped me in completing my project work successfully.

I take this opportunity to sincerely express my profound gratitude to Dr.CH.SEETHA RAM, ASSISTANT PROFESOOR, Department of MBA, who have been our project guide and who have helped me in preparation of the project report.

I am highly indebted to the Management of idea cellular company ltd for permitting me to do the project. My special thanks to Mr. Aditya (Branch Manager), Hyderabad, for allowing me to undertake this project and for all the facilities provided to me, and for giving encouragement, inspiration and guidance.

I also thank all my family members and friends for their cooperation and encouragement during the project.

(P.Avinash)

INDEX
Contents
Chapter 1 Introduction to the Study Objective of the Study Importance and relevance of the Study Scope of the Study Methodology used in the study Limitation of the study Chapter 2 Introduction of the Soft Drinks in India History of Soft Drinks in India History of Pepsi Production Process Product Manufactured and Main Consumer Chapter 3 Organizational Structure History and Organizational Structure of Lumbini Beverages Chapter 4 A Theoretical frame work of Channel of distribution Chapter 5 Channel of distribution of Lumbini Beverages Pvt. Ltd. Chapter 6 Conclusion

Page. No

Chapter 7 Findings & suggestions Chapter 8 Bibliography Annexure

Introduction
When Mr. Rajeev Gandhi came into the power as Prime Minister of India, then it was expected the liberalization of Indian economy. This was the expectation of his modern concept regarding every walk of life. When Pepsi has appealed on our collective consciousness of few years ago to be more exact in April 1989. When it set up operation for beverages snack foods and export business. The establishment of Multinational Company Pepsi was supposing to prediction in present Indian business scenario. Despite love for ones own motherhood and traditional concept of Indian people it was assumed that it is very hard to make and create taste and preference about soft drinks but despite of having so many confusion, no one was able to assume such a wide acceptance and it was PepsiCo. Who could be able to penetrate in Indian soil and it was the Pepsi that has got not only a place in Indian hospitality, but also taken place of traditional sharbat of lemon and sugar. And needless to say Generation next has become the slogan of the day. The first managing director was Mr. Ramesh Vanagal but present is Mr. P.M. Sinha in India. During these years beverages begin an exclusively franchise operating beverages now has five company owned bottling operation (COBO) the business expects to grow three times faster than the industry growth rate 1995 and its vision is to become INDIAS BEST CONSUMER PRODUCT COMPANY in all aspect. The snacks business has seen some major success and going for leadership too. Pepsi is a leader in the snacks food business. The division plans to introduction wide range of snakes in to Indian market in the next three years. The restaurant business has also come Kentucky Fried Chicken (KFC) has opened its first outlet at Bangalore Pizza but it also expected to open restaurants shortly city wise. Whole of the operations of Pepsi in India has made a rapid change in Indian life style, which is resulting in fast food life. Pepsi is a world leader in restaurant & soft drink whether it is in London or in Ludhiyana, America or Ahamedabad, Berlin or Bombay, Paris or Visakhapatnam, Manchester or Madras.

Pepsi company has pumped in Rs. 300 crores ($ 95 million) as fresh capital and has recently received permission from the foreign investment board in Rs. 300 crores ($95 million) more. The investment phase will continue and could add unto Rs. 700 crores over the next three years. The figure is not cast in stone if volume exceeds according to expectation. They will increase capital expenditure. Apart from these things there is an expression which can not verify easily that is Pepsi has made qualitative gains. The foremost is its image from being perennially seen as a loosing company its now got the image of being a winner. This major turn around is not small achievement considering that since it was established in 1989 taking the hard ship route prior to liberalization and weighed down by export commitment. Pepsi has won more battles than it has lost. In April 1993 Voltas and Punjab Argos stakes were bought over converting Pepsi foods from a three way joint venture to be a fully owned subsidiary week bottlers who did not have the financial capacities were given massive support in the form in interest free loans to upgrade their operating capacity . But the strategy which has proved to be winner was the position, Pepsi decided to take in Company Owned Bottling Operation (COBO). For this another subsidiary PepsiCo, India holding was set up as an investment vehicle, capitalized 95 million dollar. Within a year 1994 Pepsi has bought over 5 bottlers including dukes in Mumbai, which was running in Maharastra which has been bought over from Voltas high speed imported lines with a speed of 600 bottles per minute was installed in Delhi. Pepsi has a strong franchisee in the Jaipurias of Pearl drinks.

OBJECTIVE OF THE STUDY

Management is a course which teaches the student to get the work done properly from different available sources viz. man, machine, material, money etc. So there can be a satisfaction from the organization side and the workers side who play a significant role in achieving success. So far the fulfillment or the management course, it gives emphasis to project work and students learn how to plan in practical terms rather in terms of theory only. Student tends to develop analytical and problem solving skill. We necessary become motivated and competitive, in fact all the learning that goes on for the two year term become so much the part of our thinking that we developed a well all rounded personality. The following are the objectives and purpose of the study: For the fulfillment of Post Graduate Diploma in Management (PGDM) programme as realized by the Academy of Management Studies, Gitam. (AICTE approved) To care and contact with the working of an organization and to see the different types of marketing activities. The main emphasis is on the distribution Channel aspect of the organization. Whatever the subject taught in the class room of PGDM course that is completely theoretical. So during the training period we compare how the marketing research (sales) activities (practical) of our organization with the theories. Find the depth and width of distribution channel adopted by Lumbini Beverages Pvt. Ltd. Vizag and compare them with those followed by competitors. To ascertain the consumer brand perception of cold drinks with respect to price, product, quantity and advertising.

IMPORTANCE AND RELEVANCE OF THE STUDY

Cold drinks were started with the idea of quenching the thirst of the persons traveling. It was also felt that reliable good water was not available everywhere. So people would really on their packed bottle and with this idea its makers made these drinks available mostly, at those places where water was not available i.e. on highways and long distance trains. But slowly and slowly with its beautiful taste these become very popular and now they are available not only in the market and street corners, but also people have started keeping it in their house. The credit of popularizing the soft drink goes to Coca Cola. This was the drink which is liked by all ladies, gents and children. Now days soft drinks are quenching thirst looks more often; they are taken due to habits. Gold Sport is considered as the first branded soft drinks, established 53 years ago before all empowering Coca Cola faced competitions and its euphoric image built up in the western countries helped it get ready clientele and clamor. Parle Export Pvt. Ltd. is regarded as the first Indian Company introducing Limca a leman drink complementary to it this has also introduced Cola Pepone which was withdrawn in the face of tough competition from Coca Cola. When Coca Cola bid a Farwell in 1977, Indian market was open for various new forward publishing different brands in the markets. Parle people introduced their Cola, Thums Up with a mighty saying Happy days are here again as if happy days went away with Coca Cola. Pure drinks of Delhi also without lasing much introduced pure drinks were producing and marketing Coca Cola earlier Campa Cola with Campa orange and Campa lemon. Modern Bakeries entered the market with Double Cola Seven, Mohan Makings with Merry & Plkup and McDowell with Thrill, Rush and Sprint. This is Indian market where there was no competition and high voltage advertising was on each one was trying their best to become number one company with A class product in the field of Soft

drink business. Now after a long gap government of India had given permission to Coca Cola, which joined with Parle to do business in India. They are trying their best to regain prestige which it had before. The much rival of Parle is Pepsi an American concern. It started business on the Indian soil just a few years ago. Today, it has occupied 62% shares of Soft Drinks market in India. Now Pepsi is going all out to prove that they are the best. But now due to some factors competition among them has become stiffen. So in this way the important activities have increased.

SCOPE OF THE STUDY

The main scope of this study is to ascertain the effectiveness of channel of distribution and various methods to increase the sales volume of the concern. The methods include regular information to the buyers creating a brand position in the market and taking measures to make the brand remain in its position. One of the important aspects of this study is also to increase the market segment for the product.

METHODOLOGY USED IN THE STUDY

Marketing Research is the systematic designing, collection, analysis, and reporting of data and finding relevant to a specific marketing situation facing the company. The present study of Soft drinks markets in all over Visakhapatnam is based on survey methods. In survey methods, there are two types of survey. One is Census Method and another is Sampling Method. In this sample survey methods I have taken only a small part of the whole and data collected from the small part are made applicable to the whole i.e. I have taken vizag and some adjacent area of vizag like dabagargen, vizag City etc. Within the time limit, I tried my best to select the sample representative of the whole group. During my training, I maintained different chart for different routes during my dealer survey. I have collected data from the distributor of Vizag.

Data Sources Primary data collection involved distributors, retailers and consumers Research Approaches Research Instrument Sampling Plan Sampling Unit Sampling size Sampling procedure Contact Method : : : : Distributors 02 Retailers 350 Consumers 1100 : : Survey Interview Schedule

Purposive Selection Personal Interview

In interview schedule I used multiple choice question and ranking system questions.

LIMITATION OF THE STUDY

As I was asked to carry on my vocational training I found the following limitations during my training period. So I could not collect all information regarding my topic. Shortage of time factor was one of the biggest constraints. Most stress was given on the primary data as it was difficult to collect secondary data from the organization and distribution since it is difficult to ascertain the authenticity of their statements. All the observation and recommendation will be made on the feed back obtained from survey.

CHAPTER 2

HISTORY OF THE SOFT DRINK IN INDIA

Christopher Columbus as a traveler of world found a lot of new things which was not in the eye of the world community which is now in our history but now if any one does travel to whole part of world to get one thing in some form that is Pepsi. Travel to any corner of the globe you are sure to spot a label splashed in blazing blue, red and white becoming you to some Sugared water. This dark coloured drink WillyMilly has today become nothing but spot of an international anthem with young and old, rich and poor wants for a sip and saying Yeh Dil Mange More. Gold Spot is considered as the first branded soft drink established 53 years ago before all empowering Coca Cola entered the country to dominate the scene. It faced no competition and its euphoric imaged built up in the western countries helped it to get ready clientele and glamour. Parle Export Pvt. Ltd. is regarded as the first Indian company introducing Limca, a lemon drink complimentary to there well established Gold Spot in 1970 which got moderate success. However, before this, he had also introduced Cola Pepino which was withdrawn in face of tough competition from Coca Cola. When Coca Cola bid farewell in 1977, Indian market was open for various cold drinks several companies came forward publishing the different brands in the market. Parle people introduced their Cola Thumps Up with a mighty bang saying Happy days are here again as if happy days went away with Coca Cola.. Pure drinks of Delhi also without losing much time introduced pure drinks were producing and marketing Coca Cola earlier Campa Cola along with Campa orange and Campa lemon. Modern Bakeries entered in the market with the Double Seven. Mohan meakings with Merry Pickup and McDowell with Thrill, Rush and Sprint in Indian market where there was no competition previously. A cut throat competition and heavy advertising was on. Each one was trying their best to become the number one company with A class product in the field of soft drink business in India. The much rival of Parle is Pepsi an American concern. It started business the occupied nearly 50% share of soft drinks market in India. Now, Pepsi is going all out to prove that they are the best.

HISTORY OF PEPSI
PepsiCo is a USA based company having its head quarters at New York with the net worth of $30-40 million. The average sales of the company are approx 90 million bottles per month. Pepsi made it first international move in Russia in 1959. During the Khrushchev era, within 32 years Pepsi emerged as the biggest competitor for Coca Cola. Pepsi is available in 155 countries. In any soft drink, on the globe Pepsi food is one of the largest soft drink companies in the world with its headquarters in New York. It was invented by Pharmacist Culab D. Baradham in 1898 to cure the disease Dyspepsia. It is from this word that its name was related to Pepsi. Soon it entered the American market as soft drink, which at that time mostly dominated by Coca Cola, but soon Pepsi able to dominate the Cola market, and there after it never looked back. Pepsi and Coca Cola are engaged in ferocious cola war that has taken the whole world by storm. Pepsi entered the Indian soft drink in Kanpur in 1988 and began its production in May 1990 and soon it was giving the local contenders run for their money in soft drink market. It comes out with dazzling marketing innovation that rocked the cola market, like selling the product through function Pepsi outlets. Its advertisement agency was Hindustan Thomson Association (HTA). Its advertisement budget for 1995-1996 was valued at Rs. 24 crores which is likely to be increased manifold in coming years. Pepsi food is one of the largest and best foreign investments in India. Till today it has invested Rs. 500 crores in India to develop the local market. Pepsi has distributed exclusive franchises in India to bottle its total product. There are 28 bottling plant of Pepsi in India. Some are directly controlled by Pepsi and rest is under various franchisees. Pepsi stands 51st position among the fortune 500 companies of the world. Its total capital is approx $3000 crores and total sales annually is worth $37 crores. Its total profit in the

year 1996-97 was worth Rs. 458 crores approx. The total number of employees engaged in the business is 45.25 lakhs globally.

PRODUCTION PROCESS
The process of manufacture of Aerated water (soft drink) like Pepsi brand product is divided into mainly five parts such as

1. Water Treatment 2. Syrup Making 3. Bottle Washing 4. Filling 5. Testing of Product

Water Treatment :
Water treatment is very essential in soft drinks plants as the nature and quality of water varies from place to place. To set uniform and standard water the process of treatment is carried on. The water taken out from bore well by the help of motor pump and pipe line are collected in storage tank where is pre chlorinated by chlorinators and by the help of pipe lines comes to treatment tank called coagulation tank where to this water solutions of different strength of bleaching powder, ferrous sulphate, hydrated lime are added through dosing pump to reduce alkalinity, hardness, kill the bacteria .The chemical are mixed by mechanical stripper and then the suspend mattress settle down as sludge and clear water passes to retention tank. From this tank, the water passes through sand filter containing fine sand and pebbles and carbon filter containing granular carbon and finely through water polisher, micron filter, and UV lamp to ensure clear and sanitary water for use. Further water used in bottle washer and boiler need softening .for this purpose ,the water from storage tank ,after passing through two filter beds contain fine sand and granular carbon respectively comes to pass through bad resin were it is softened .this soft

water is essential to use in and bottle washer to reduce scale formation inside the machines.

Syrup Making:For syrup making of particular brand, calculate quantity of sugar water activated carbon and high flow super cell known as filter aid taken in to sugar to enter steam and also filled by a motor with agitator. Sugar syrup called raw-syrup is prepared by dissolving the sugar with continuous stirring and heating by steam supplied by fired boiler. This hot syrup by the help of pump is filtered through a filter press attached with a series of quality filter paper to separate out carbon particles. Clear hot syrup by the help of SS pipe lines passes through water P.H.E. for cooling and the then another P.H.E. circulated by glycol for further cooling. The chilled syrup comes to a mixing tank to use calculating of sugar quantity by Brix Hydrometer, concentrate added and mix thoroughly by a mechanical Stirrer fitted to the tank. This syrup is now finished syrup ready for use. The concentrate mainly, the liquid part are kept in a cold store, the temperature of finished syrup is also maintained by air-conditioner. All the containers used for syrup making are cleaned and sanitized by Soda-Bi-Crab, strong chlorine solution and hot caustic soda solution.

Bottle Washing:
Bottle washing is an important part in soft drink plant. The empty durable and returnable bottle used are returned from market in plastic carats are fed to a bottle washing machine (washer). The machine has double end system with circular chain to carry the bottles. Caustic soda Tri-Sodium Phosphate, Sodium Glausonate is adding to the caustic by the supplied. The Caustic tank filled in with water heated by steam supplied by the boiler. The empty bottles enter to the hot Caustic tank in one end and after being cleaned by hot Caustic solution and finally washed with water through spray jets fitted are discharged in other end. The washed bottle proper inspections are SU 319 and SU 853 used for conveyor cleaned and smooth running of chain carrying bottles. SU 260 and SU 773 is used for bottle cleaning, shining, and mold removing.

Filling:
Finished syrup and treated water lime are commixed to a dosing pump which mixes syrup and water with ratio of 1:5 and the syrup mixed with water enters to carbonator tank to mix CO2 gas, which is preserved in cylinder for use. The cylinders are connected through CO2 manifold to tank to use requisite quantity of gas. To control CO2 pressure and temperature of liquid; we used recording control (Taylor). The syrup passed through a P.H.E. which is called itself by circulation of chilled glycol supplied chilling F-22 gas used. The syrup being chilled easily mixed with CO2 gas and enters to filter for bottling. The filter is connected with filling valves and lift cylinders. The lift cylinder functions by pressure of air supplied by an air composer. The syrup is known as beverage in this stage is filled in the cleaned bottles which are durable in nature and returnable by buyer filling machine (filter) by a counter pressure of carbon dioxide gas. After beverage filled in bottle it goes to the crowner where with the help of crown crocks the bottles are sealed (crowned) to project the carbonation, flavor, outside contamination and spoilage. The finished products are coded by a coding machine and inspected properly by inspection light while passing through the conveyor where finished product are accumulated enters to carat washer machine and it is washed moves through the conveyor where finished product are accumulated.

Testing of product:Finally the finished syrup during bottle is tested in laboratory to meet the parameters and also to get a standard and quality products to maintain the standard and information and uniformity in products the sugar contents and carbonation in the bottle are checked in regular intervals by Brix-hydrometers, Refrectometer and pressure gauge. The dead weight tested is used to calculate pressure gauge to know the correct pressure. TA & Ph are tested by digital Ph meter. Electronic digital balanced is used to weight chemical to conduct test in lab. The purity of CO2 is checked by CO2 purity tester. The chlorine comparators. The microbiology test of the product and water used in syrup making and

production are also done to ensure that the product is free from any bacteriological contamination. To conduct the micro test hot sterilizer incubator, autoclave, pads filter membranes, media are produced and used. The Diesel generator is operated in case of electricity failure for smooth operation of the plant. To drawn electricity for the State Electricity Board the transformer is used. The steps involved in the production process are: First the fork lift supplies the empty bottles which are collected from the distributions. Then depalletising is done i.e. separating cases filled or empty bottles from the wooden planks. Uncasing is done by separating empty bottles from the cases/carats. Empty bottles are then fed into the bottle washer where stream with some chemical is used for washing. Washed bottles are then send to the filler where premix (Composed of syrup, treated water bulk CO2) is filled in it. The whole concentrated is chilled with glycol before filling and then crowning is done. The filled bottles are passed through inkjet coder for printing price and date. Then again the filled bottles are send for final light inspection and from there they are collected on a table. Lastly the filled bottles are arranged in the crates (casing) and then palletizing is done for storing it in the warehouse. PREPARATION OF SYRUP =Treated water + Sugar = Flavour

PRODUCT MANUFACTURED
The product manufactured by Lumbini Beverages Pvt. Ltd. are very limited ranges as it is not independent to diversity its products. It is a unit of Pepsi food Pvt. Ltd. which supplies concentrates for drinks. They are:-

Products Pepsi Mirinda Mirinda Mirinda 7 Up Mountain Dew Slice Lehar soda Pet Pet Can Aquafina (Mineral Water)

Quantity 300 ml, 200ml 300 ml, 200ml 300 ml, 200ml 300 ml, 200ml 300 ml, 200ml 300 ml, 200ml 300 ml 300 ml 1.5 lt. 2 lt. 330 ml 1 lt.

Colour Brunt sugar Sun-set Tetrazine Tetrazine Colorless Colorless Sunset Tetrazine Brunt sugar Brunt sugar Brunt sugar Colorless

Flavour Cola Orange Lime Mango Lemon Lemon Mango Lemon Cola Cola Cola White

CONSUMERS
The main consumers of these products naturally are youth. Besides the direct consumer it is also used for the some purpose of providing it to the mass by hoteliers, restaurant owners and various other soft drink peddlers. These products are the choice of the new generation. Thus it can be said that it is a product of mass consumption.

CHAPTER 3 COMPANY PROFILE

History of Lumbini Beverages Pvt. Ltd.

Steel City beverages Pvt. Ltd. is situated at Adityapur Kandra Road in Jamshedpur. Rushabh Marketing Pvt. Ltd. is the marketing division of Steel City beverages. Steel City beverages Pvt. Ltd. is a mother unit and its whole marketing activities are done through Rushabh Marketing Pvt. Ltd. Steel City beverages is one of the Pepsi foods Bottling plants in the country and one of the three in Eastern India. The other two Calcutta and Guwahati. But from 01-04-1997 Pepsi Foods Ltd. India determines to open another bottling plant which is situated at Hajipur namely Lumbini Beverages Pvt. Ltd. It is only for North Bihar. Steel City beverages Pvt. Ltd. was established by Late Mr. Dharam Chand Kamani in the month of June 1967. The machineries of its main plant were imported in 1968 and production started in March 1969. Before the establishment of Steel City beverages Pvt. Ltd. Coca Cola was not much popular among people of Bihar state as pure soft drink. Because at that time the bottles of Coca Cola was supplied by the outsiders who were unable to make Coca Cola popular in Bihar. So after considering the needs and desires of people Mr. Dharma Chand Kamani brought in Bihar. With this effort Coca Cola become popular among the people of Bihar. But in 1977 due to the sudden change I the policies of the Government the import license for the concentrate of Coca Cola was stopped. So Steel City beverages Pvt. Ltd. had to walk over to Indian Concentrate Companies. They were modem food industries supplied concentrate of double seven and non ice cream soda. In 1983 the company introduced a cola drink THRILL of Mc-Dowell & Co. Ltd. in the place of Double seven and triangular and in the very next year two soft drink RUSH an orange flavoured and SPRINT as lemon flavoured of Mc-Dowell & Co. Ltd were introduced.

ORGANIZATIONAL STRUCTURE OF LUMBINI BEVERAGES PVT. LTD.

An ideal organizational structure facilities management and the operation of the enterprise and it help the organization in achieving its goal. In a simple term in various parts or component are interrelated or interconnected and this way it is the established pattern or relationship among various function of the organization in the established manner. The managing director holds the top position. At present, the managing director of Lumbini Beverages Pvt. Ltd. is Mr. Charan Khilani. But the overall policies regarding management decisions and all executives function or performance look after by the day to day decision and general administration as well as management. The MD has given the power of attorney and authority to director Mr. Ravi Khilani. Mr. Ravi Khilani who is well advised by the MD. The director Mr. Ravi Khilani looks after all functional departments that sales production, account, personnel and purchase. Though the manager all the functional departments has specially designated as head of personnel department. Every department has to report directly to the managing director and is responsible to his only for working in spite of this all departments is under the control of the director Mr. Ravi Khilani. Because he is the Chief Executive of the company cited earlier. The overall organizational structure can be shown

OVERALL ORGANIZATIONAL STRUCTURE OF LUMBINI BEVERAGES PVT. LTD., VIZAG

BOARD OF DIRECTOR

MANAGING DIRECTOR

CEO

FINANCE MANAGER

PLANT MANAGER

P.A.M.

H.R. MANAGER

A/C ASSISTANT

SHIFT ENGINEER

SHIPPING COORDINATOR

H.R. EXECUTIVE

A/C CLERK ASSISTANT

WORKER / OPERATOR

H.R. CLERK ASSIS.

HOS

T.D.M. . A.D.C.

M.E.M.

M.D.M.

Q.C.

SENIOR TECHNICIAN

M.D.C.EXECUTIVE

C.E.

TECHNICIAN

M.E.

The marketing manager is in charge of all marketing activities i.e. sales promotion, publicity and advertisement, marketing study and shipping. But the main function of the marketing is to exercise the control over the channel of distribution.The marketing manager is assisted by sales executives, city sales executives and rural sales executives and sales executive of shipping department as follows:-

DIRECTOR

MANAGING DIRECTOR

HEAD OF SALES

STATISTICIAN

CITY SALES EXECUTIVES

SALES EXECUTIVES

SALES SUPERVISOR

CHAPTER 4
A THEORETICAL FRAME WORK OF CHANNEL OF DISTRIBUTION

A THEORETICAL FRAME WORK OF CHANNEL OF DISTRIBUTION

Marketing channels are sets of interdependent organization involved in the process of making a product or service available for use or consumption. The main objective of the marketing process is to distribute the products to the actual users. This function involves a number of sub-functions to be performed by a producer or manufacturer. These two functions are most important first, the creation of demand is made through the process of advertising and sales promotion activities. On the other hand the distribution through the channels of distribution. The decision relating to the channel of distribution is a very important decision from the firm point of view because the selected channels affect considerable other marketing decision. Such decisions are of long term nature and exercise their impact on the cost structure of the firm also. By channel distribution mean the intermediaries or the process through which the goods products are transferred from the producer to the ultimate users. Now a day any of the producers possibly do not sell their goods directly to the final users. There are a lot of intermediaries between producers and consumer, bearing a variety of name performing various kinds of function. Some intermediaries like wholesalers and retailers buy and resale taking the bill. They are known as merchant middle men and other are brokers, representative sales agent who seeks or search for customers and negotiate on the behalf of the producer but do not take of goods. These are called as middlemen. The manufacturer and its distributive outlets share common objective to sell the manufactured products at a profit. No doubt its objective differs with the marketing circumstance. Even though many variation of specific objective fits into some categories. These are as follows: To built distribution network loyalty

 To stimulate distribution To develop managerial efficiency in distribution organization To identify the source of supply for the product line at the final buyers level

The channel of distribution is a structure which organized and presents a choice among alternative channels of distribution of the different marketing situations faced by retailers, whole sellers and producers with in the structure. It may be considered as a series of function which must be performed in order to make producers efficiency. To bearing maximum profits of all institutions concerned a channel of distribution should be treated as a unit of total system of action. The activities of the manufacturer need to be coordinated with these middlemen used in the distribution of given product. The important of middlemen in channel of distributional can be over emphasized. It is that who Collects concentrates the output of various producers, Subdivides these into lot desired by the customers gathers various items together in the assortment wanted and Disperses the assortment to consumer industrial buyers.

The role of middlemen that of specialist in concentration equalization and dispersion besides he side in the creation of the time from and procession utilities

CHAPTER 5
CHANNEL OF DISTRIBUTION OF LUMBINI BEVERAGES PVT. LTD.

Channel of Distribution of Lumbini Beverages Pvt. Ltd. Madhurawada, in vizag

To make its products available at the right places at the right time in the market, the sales department of the company pays major attention on controlling the channels of distribution. Single type of markets channel is maintained by the company right from its pioneering stage. The nature of the channel is as follows:Company

Distributors

Dealers

Different Outlet Owners

Consumers At first the soft drinks supplied to the distributors directly. Retailers or owners of any outlet can not take the delivery from company. They have to take the products from their respective or nearest distributor. There are about 50 distributors and innumerable number of retail outlets operating with the company in its entire market areas which contains total Bihar. In all the important places of entire territory this company has its distributors. These distributors selected on the basis of assurance given by them regarding the minimum sales which they have to maintain annually. The selection is also done on the basis of the financial position and reputation of distributor in the market. As for example in appointing a distributor first engaged in soft drink business second priority is given to those people who are in cigarette selling business. Depending upon the market, each distributor in the initial stage has to deposit some security money.

The retailers are selected by the distributor fixed criteria for the selection or appointment or retailers from the side of the distributor. Any one like Panwala, Cigarettewala or any other shopkeeper can have the stall for the sale of soft drinks and they are called retailers or outlet owners. They have to give assurance to the concerning distributor for better sale and at the time of taking delivery they have to deposit the security i.e. the charges if the empty bottles with specified retailers purchasing price. The charges if the empty bottles with specified retailers purchasing price. The distributor at first has to seek the permission of sales department for the number of cases of soft drinks required by them. After getting the proper authority from sales department paying the requisite amount either cash or demand draft.

WAREHOUSING
Every company has to store its finished goods until they sold. A strong facility is necessary because production and consumption cycles rarely match. Warehousing is not a simply storing activity but a package of services that enables the smooth running of the industry. The stores must be in constant touch with the use department in order to provide uninterrupted services to the manufacture and its decision since working capital is locked up in the warehousing stores in equal to money. The stores functions can be organized in the following manner:a) To receive raw material components equipments etc. b) To meet the demand of use department by issuing the order c) Accounting the transaction properly. d) Minimizing obsolescence surplus and scrap by right identification and using correct preservation method. The company supply finished products frequently to different distributors as per the demand. Every distributor keeps a minimum stock of different products of the product line so that the uninterrupted supply could not affect. In the industrial sector service of optimization where boils down to any exercise of optimization where limited available resources are to be distributed equitably. The problem arises from the material that are in stock the form of capital cost, storage loss, pilferage obsolescence, insurance, handling, documentation etc. Services level that can be maintained and hence the concept stores in money should be understood by every body in the organization.

STUDY ON PRODUCTS
Product line is a group of product, that are closely related because they satisfy a class of needs or used together or sole to the same customer groups or marketed through the same types of outlets or fall within given price range. Lumbini Beverages Pvt. Ltd., has the following product line:

Name Pepsi Mirinda Mirinda Slice 7Up Dew Lehar Soda

Colour Brunti Sunset Tetrazine Sunset Colourless Colourless Tetrazine

Flavour Cola Orange Lemon Mango Lime Lime Lemon

PRICE SHEET OUTLET RATE

FLAVOUR PACK SIZE 200 ML 300 ML 600 ML 2000 ML 200 ML 300 ML 600 ML 2000 ML 200 ML 600 ML 200 ML 300 ML 600 ML 2000 ML 200 ML 600 ML 2000 ML 250 ML 500 ML 1200 ML 250 ML 330 ML 200 ML 300 ML 600 ML PCS RATE PER PCS RATE 7 9 19 51 7 9 19 51 7 9 7 9 19 51 7 19 51 9 21 44 14 23.5 10 9 19

C.RATE
RATE PER PCS RATE 8 10 20 55 8 10 20 55 8 10 8 10 20 55 8 20 55 10 23 48 15 25 12 10 20

PEPSI COLA PEPSI COLA PEPSI COLA PEPSI COLA MIRINDA ORANGE MIRINDA ORANGE MIRINDA ORANGE MIRINDA ORANGE MIRINDA LEMON MIRINDA LEMON 7UP 7UP 7UP 7UP MOUNTAIN DEW MOUNTAIN DEW MOUNTAIN DEW SLICE SLICE SLICE MY CAN PEPSI DIAT SLICE TETRAPACK LEHER SODA LEHER SODA

24 24 24 9 24 24 24 9 24 24 24 24 24 9 24 24 9 24 24 12 24 24 30 24 24

168 214 454 459 168 214 454 459 168 214 168 214 454 459 168 454 459 214 498 532 330 564 285 214 454

192 240 480 495 192 240 480 495 192 240 192 240 480 495 192 480 495 240 552 576 360 600 360 240 480

STUDY ON RETAILERS
Retail Shop type I. Monopoly Retail Shop II. Mix Shop : : The shop selling only one companys Products The shop selling many companys Products

The retailers can build a great deal of goodwill for the firm. The marketing strength depends on the strengths of retail dealers. Research has conduct survey on different types of outlet like bakeries, cold drink parlor, Booth and general stores etc. According to his survey, the major reasons for selling Pepsi products are: (1) Brand Image (2) Customer Demand (3) Profit Margin (4) Advertisement (5) Good Quality (6) Sales Promotion for Retailers Sales Promotion for Consumers 18% 20% 05% 30% 10% 07% 10

BRAND PREFRENCE
Pepsi products are most popular brand but Coke products are very dear brand of consumers due to advertisement.

After the collection of different views from consumer which includes, servicemen, students, and businessman and observing the sale of Pepsi products. The research has calculated the preference consumption of different Pepsi products by the people of Visakhapatnam

Chapter 5 Data Analysis

1) Which company Visi-Cooler do you have? (a) Pepsi (c) Both (b) Coca Cola (d) Own

25 60 a 35 b c d

80

Interpretation: Out of 200,60 of people have Pepsi visi-coolers,80 cococola,35 members have both coolers.

2) Which factors affect the sale most? (a) Advertisement (c) Presence (e) Price (b) Scheme (d) Taste (f) Others

6 44 60 a b c d 24 30 36 e f

Interpretation: According to my survey sales are effected by 30% of advertaisments, 22% of price, 18% of presence, 15% of scheme, 12% of taste and 3% of other things like maintenance etc.

3) When a customer comes to your shop which brand of soft drinks does he/she demands? (Rank them) (a) Pepsi (c) Others (b) Coca Cola

32

a b 58 110 c

Interpretation: In my survey people gave ranks like this way,for this pepsi 110 people gave more importance and for that coke they responded 58 people and finally 32 people prefer other outlets.

4) Which brands of soft drinks are available in the outlet?

(a) Pepsi Cola (c) Mirinda (L) (e) Slice (b) Mirinda (O) (d) 7Up (f) Mountain Dew

25 50 a b 40 c d e 30 f

35

20

Interpretation: In the outlet 49% of coco