1. Introduction.

Industry and company

2. Market segmentation

3. Product line

4. Competitive priorities

4. Operation management

Process view and supply chain view

Internal supplies and internal supplier

Internal customer and internal customer

5. Break even analysis and purposes of break even

7. Decision making short term and long term

8. Inventory management

9. Inventory management

Strategies either make to order or order to make

What type of inventory manage and cost of inventory

10. EOQ, Reorder point, safety stock, and define method

11. Process Management either process strategies or Analysis

strategies

12. Project management

13. Location decision

14. Transportation decision

15. Distribution
Introduction of Beverages Sector.

Pepsi and Coca Cola are two of the top manufacturers of CSDs (carbonated soft
drinks) in the world which are operating more than 100 years. These companies
have different brands in cold and also soft drinks.

In this project first we have defined marketing strategies which are adopted by Coca
Cola and Pepsi. The strategies adopted by Pepsi are introducing new soft drink
products, Diversification, Aggressive advertising campaigns. And the strategies
adopted by Coke are as, Accelerated soft drink growth, broaden their family of
beverage brands, Growth system profitability and capability together with their
bottling partners, Serve customers with creativity and consistency, direct investment
to highest potential area across market, Drive efficiency and cost effectiveness
everywhere. We have defined marketing mix of these companies.

Our objective is to find out the key success factor of Pepsi and coke why they are
leader in Pakistan market as compare local brands. We have collected our research
data using secondary as well as primary data techniques. We used questionnaire
tool by taking 100 respondents.

PEPSI PAKISTAN

The market in Pakistan is surely dominated by Pepsi. It has proves itself to be the
No.1 soft drink in Pakistan. Now days Pepsi is recognized as Pakistanis National
drink. In 1971, first plant of Pepsi was constructed in Multan, and from their after
Pepsi is going higher and higher. Pepsi is the choice soft drink of every one. It is
consumed by all age groups because of its distinctive taste. Compared with other
Cola in the market, it is a bit sweeter and it contributes greatly to its liking by all.
Consumer's survey results explain the same outcome and Pepsi has been declared
as the most wanted soft drink of Pakistan.

Pepsi's greatest rival is Coca Cola. Coca Cola has an international recognized
brand. Coke's basic strength is its brand name. But Pepsi with its aggressive
marketing planning and quick diversification in creating and promoting new ideas
and product packaging, is successfully maintaining is No.1 position in Pakistan. In
coming future Pepsi is also planning to enter into the field of fruit drinks. For this
purpose it has test marketed its mango juice in Karachi for the first time.

When Pepsi was introduced in Pakistan, it faced fierce competition with 7up, lemon
and lime drinks, which was established during 1968, in Multan. Pepsi introduced its
lemon and lime, "Teem" to compete with 7up. It successfully, after some years, took
over 7up, and this enhanced Pepsi's profits and market share. In Pakistan, Pepsi
with 7up enjoys 70% of the market share where as the coke just has 20% markets
share.

Pepsi is operating in Pakistan, through its 12 bottlers all over Pakistan. These
bottlers are Pepsi's strength. Pepsi has given franchise to these bottlers. Bottlers,
produce, distribute and help in promoting the brand. Pepsi also launched its fast food
chain KFC i.e. "Kentucky Fried Chicken."
MARKET SEGMENTATION AND TARGET MARKETS
This statement is quoted from Pepsi Cola International official website. In 1960,
Young adults become the target consumers and Pepsi's advertising keeps pace with
"Now it's Pepsi, for those who think young".
Now there is no specific segmentation of market with respect to customers because
their product is standardized. According to their general manager sales, different
brands are targeted towards people belonging to different age group, according to
him 7up is more likely to be preferred by old age people where as Miranda is popular
among teenagers and Pepsi is preferred by people belonging to any age group.

ACHIEVEMENTS
Last year Pepsi Cola Multan showed their best ever performance of product growth
rate in the Asian Zone and stood fourth in the Asia. Recently last month Pepsi Cola
Multan won the Pakistan quality contest by securing first position. As compared to
last year their production capacity has increased to 100,000 cases per day in peak
season.
COMPETITIVE PRIORITIES
COST
As Pepsi cola Multan is producing standardized products so they have to maintain a
fixed cost. They want to lower per unit cost as well as the total cost of production

QUALITY

Pepsi cola Multan is producing a standardized product because all the manufactured
items contain the same amount of the raw material required. So they want to
maintain the quality of products. They want to deliver high quality product according
to international standards given by Pepsi Cola International (PCI).

TIME
Pepsi Cola Multan meets its delivery-time promises i.e. The Company pays most
attention to delivery -on- time to satisfy customers & retailers needs on the time,
which they want.

FLEXIBILITY

Pepsi Cola Multan does not focus the unique demand of customers & products are
standardized, So Company works for volume flexibility i.e. Company is able to
accelerate or decelerate the rate of production quickly to handle large fluctuations in
demand.

Other core competencies

1. Strong distribution network

2. Wide geographical coverage
3. Experienced engineers and sales staff
4. Quick customer response and feedback

Operations management in Pepsi

Operations management is the management of an organization's productive

resources or its production system, deals with the design and management of
products, processes, services and supply chains. It considers the acquisition,
development, and utilization of resources that firms need to deliver the goods and
services their clients want. Purvey of Operations management ranges from strategic
to tactical and operational levels. Representative strategic issues include
determining the size and location of manufacturing plants, deciding the structure of
service or telecommunications networks, and designing technology supply chains.

Tactical issues include plant layout and structure, project management methods, and
equipment selection and replacement. Operational issues include production
scheduling and control, inventory management, quality control and inspection, traffic
and materials handling, and equipment maintenance policies. Build a management
operation, launched the product line of Pepsi co company. Operations management
focuses on carefully managing the processes to produce and distribute products and
services. Usually, small businesses don't talk about "operations management", but
they carry out the activities that management schools typically associate with the
phrase "operations management." Major, overall activities often include product
creation, development, production and distribution.

Pepsi Manufacturing.

Pepsi Cola has production system and bottling facilities all around the world. This
plays an important part in their business since they are one of the top of the soft
drink industry. Outsourcing comes at the expense of improving in-house skills, which
will eventually lead to reduced costs.

Pepsi Cola Company and its production systems

Primary inputs: chemicals, vanilla beans, kola nuts, sweeteners, supplies, cans,
cartons, personal, utilities, machines, manufacturing, retailer, store, etc

Conversion subsystem: Transforms raw materials into soft drink and packages.

Outputs: Satisfied customers and soft drink products.

Manufacturing of the soft drink: At first the component required for making the soft
drink are vanilla beans, flavor oils, kola nuts and sweeteners. Specially, these items
are required the best quality and the water used in it are distilled and free of all
impureness
Packaging: After the soft drink is made up, it is taken to the packaging centers in
cans. Specially, in transferring of the Pepsi-cola to the packaging house, it must be
protect so that the soft drink cannot mix with another chemicals. At packaging stage,
the cartons, caps and the carbon dioxide used to carbonate soft drinks is in the
expected quantity.

Storage: it is guaranteed that the cans are bundled properly and machines do the
shifting and storing of the cans before they are sent to the retailers and store.

Total Quality Management (TQM):

1. Pepsi is a management approach that aims for long-term success by focusing on

customer satisfaction. TQM is based on the participation of all members of an
organization in improving processes, products, services, and the culture in which
they work. Quality is about manufacturing a product that people can depend on
every time they reach for it.

Pepsi knows product and package quality is a key to ensure their products in the
marketplace meet Company requirements and consumer demands. The global
nature of their business requires that the Pepsi system has the highest standards
and processes for ensuring consistent product safety. Pepsi uses a system that is
called Pepsi management System.

2. To manage their product quality. That will hold all of their operations in the same
standards for production and distribution. It guarantees the highest standards in
quality, the environment, safety and the health of customer. And they requires each
business within the Pepsi-Cola system must establish, implement, document and
maintain a safety and quality system in accordance with TCCMS requirements.

Problems in Pepsi has been facing problems in the operation department and
because of that, to deal with this, they always try to identify the problems and refer or
address the problems to the top executives of the organization. We can recognize
that all the problems will be aware and check by Pepsi co group.
Product Development

While targeting the African-American market, PepsiCo determined that its Mountain
Dew line could be augmented with a new cherry flavor (Code Red). PepsiCo also hit
the streets to go after the black and Hispanic audience with

Whom Mountain Dew has traditionally not done as well. Rap jingles starring Busta
Rhymes and Fatman Scoop hit the airwaves, and cases of Code Red mysteriously
began to appear at the doors of inner-city influencers.

DECISION MAKING IN PEPSI COLA MULTAN

Decision making in Pepsi Cola Multan is influenced by the following factors which
are.

AUTONOMY

Pepsi Multan is completely autonomous in strategy development. There is no

concept of dictation from country office rather sharing of policies is more evident.
Country office does not provide any financial resources, human resources or
managerial competence to Pepsi Multan. Involvement of country office is only up to
the extent of creating advertisement & publicity campaigns in which Pepsi Multan
also contributes.
Decision Making
Decision making process is centralized in the company. The classical model is used,
the top level managers take their time in making the decisions and all the possible
alternatives are kept in mind before going for the rationally economic solution.

The top level managers dont consult with any employee in case of programmed
decision making. The ordinary routine decisions are made by the line managers of
the middle level management after getting the permission from the general manager.

The following are the decisions which are taken by the top level of management in
the Pepsi-Cola Company:

The package positioning

Trade discounts
Advertisements
Price reductions
Distribution.

In recruitment of new employees the top level management approves the vacancies
and the Human Capital Department is asked to conduct a written test such kind of
tests are conducted for the employees of lower level. The prospective applicants are
shot listed through the interview process. After taking the interview of the applicant
the operation manager and the general manager make the final decision of selection
of the employee.

While recruiting new employees, the top management approves the vacancies and
asks the Human Capital Department to conduct the written test and this test normally
is conducted for the employees at the lower level. Then prospective applicants are
short listed through the interview process. Then the Business and operations
manager or general manager personally interviews the employees and then makes
the final decision about the selection himself.

Hence, the style of decision-making followed by the PCBPL model, is AII. That is, the
decisions are made on the basis of the inputs provided by the lower level employees
and the managers at the middle management level. Top management asks for the
suggestions and ideas of his subordinates and then takes the final decision himself.
 However, the remaining decisions, which are mainly related to the daily operations,
are made by the respective managers who are eventually made responsible for the
results.

The management is very much cooperative and encourage its employees to come
up with new ideas related to their duties and the work they do so as to increase the
overall efficiency of the organization and eventually increasing the profits.

CENTRALIZED DECISION MAKING

The decision making process in the company is highly centralized and the workers
feel that there exists no proper authority existing in the firm. The salesmen feel
dissatisfied for they are totally powerless to make any decisions themselves. In
dealing with their buyers they have not the slightest authority to allow them any credit
or discount

Decision Making (Centralized vs. Decentralized):

All the decisions taken by the top level management but management also
involve the managers of all departments and employee of the company. The
procedure of decision making in Pepsi cola is decentralized. Everybody knows
about the mission and everybody gets involve in the every decision regarding the
companys affairs. That creates the motivation and empowerment in the
employees and through this company gets effective and efficient results.

Companys all revenues and profits are also visible to everyone in company.
As well as all the strategies made on the top level management also known by the
employees and everyone take part in decision making that helps a lot in
innovation.

INVENTORY MANAGEMENT

Pepsi Cola Multan is handling four types of inventories which are

RAW MATERIAL

Raw material like syrup, sugar, filter papers, CO2, Ammonia, Empty bottles,
packaging material, Bottle cases, Chlorine, Corks and Crowns etc.
WORK IN PROCESS

Work in process will contain all those bottles which are under the process of the
filling and packaging. At the end of shift work in process inventory of is transferred to
other shift.

END PRODUCTS

End products are in the form of cases containing 24 bottles. End product inventory is
managed in two ways

1. Production department after production stores their finished goods in their

godown which is located in the premises of factory.
2. Sales department transfer their needed inventory in their godown and issue
required amount of cases to distributors.
3. SPARE PARTS

Spare parts inventory will contain items like Gear boxes, Belts or conveyers,
Motors and Switch boards etc.

TYPE OF INVENTORY

They are maintaining anticipation inventory but at very minimal level as products are
not stored for a long-time period.

INVENTORY CONTROL SYSTEM

Pepsi Cola Multan follows periodic review system for inventory management. So
inventory is reviewed normally on weekly basis and some times after. Some time
daily reviews are also made. Each month the store prepares monthly consumption
report.

LEVEL OF INVENTORY

Pepsi Multan maintains a low level of inventory because they face pressure for low
level inventory due to following factors

Company wants to provide fresh products to its customers.

Holding cost of inventory is high.

High inventory causes high tax

Management Styles
A management style is an overall method of leadership used by the manager. The
success that the management team at Pepsi has in motivating its employees to meet
their objectives is based on the management style they adopt. There are three main
management styles democratic, autocratic and the laissez-faire style.

The Pepsi Company uses the following management styles, but each one in different
departments. There are three main types of management styles used in businesses:

Democratic

The democratic leadership style consists of the leader, sharing the decision making
abilities with the group members by promoting the interests of the group members
and by practicing social equality.

This emphasizes on group agreements to generate new ideas. There are two types
of democratic management styles; democratic and consultative democratic.
Democratic is where all the managers, junior managers and employees are involved
in the ideas and final decision process. Out of all the workers, no-one has a higher
level than the others in this management style.

Democratic style is the management style that Pepsi adopts. This sort of
management style involves empowerment. In this management style individuals and
teams are given responsibilities and decisions to make, usually within a given
framework. If anything wrong happens then the individuals and teams are then held
responsible for the decisions that are chosen. With this type of management style it
allows the manager to feel comfortable with other people in the organization making
some of the decisions. Democratic managers will often want feedback from their
employees on decisions being made. Democratic leaders listen and act on the
opinions of the group. This type of management is good as it makes the employees
happy and productivity is high. This is a very good method because employee's
thoughts and suggestions are listened to by the business. This makes the
employees seem as if they are respected and that their thoughts are valid.
Feedbacks from managers at Pepsi-Colas bottling system across the globe provide
vital information that is incorporated in their strategies.

Autocratic
The authoritarian leadership style or autocratic leader keeps strict, close control over
the followers by keeping close regulation of the policies and procedures given to the
followers. To keep main emphasis on the distinction of the authoritarian leader and
their followers, these types of the leaders make sure to only create a distinct
professional relationship.

Where the leader makes all the decisions, there is no negotiation and is very
prescriptive and there is little job satisfaction. However, the job gets done quickly and
there is less conflict between different ideas. This style is hardly used among the
company as they believe that the lack of input could lead to poor results. Autocratic
does save a lot of time as quick decisions can be made and there is no time wasted
on discussion resulting in the business saving time and money.

On the factory floor at Pepsi there is an autocratic system of management where the
employees are controlled by the managers and follow their procedures.

Management Functions of Pepsi-Cola Company

There are four major functions of management of the Coca-Cola Company which are
as follow:

1. Planning
2. Organizing
3. Leading
4. Controlling

1. Planning
The Pepsi-Cola Company consists of just a three layers of flat hierarchy. Due to this
the top level management has the duty of setting the goals and objectives of the
company. Planning is also done by the upper level managers.

Strategic Goals
In most of the companies the strategic goals are made for long term but Pepsi
Companys goals are set for only three years, they change their strategies after
every three years. The goals are set by the Managing Directors of the company after
getting the clearance from the headquarters. Every year in the annual meeting they
have a review of their strategy to make sure they are moving with the changing
environment in the market.

The following are the strategic goals of Pepsi Company:

To continue to be an organization providing the quality products to the valuable

customers.

To select and retain the professional people for the organization.

To project an outstanding corporate image.

To satisfy the customer through extra ordinary service and an excellent service

A along with the complete tactical and operational support

Tactic Goals
Tactic goals are set at the end of the year at annual basis. The top level
management decides these goals with the consultation of the lower level employees.
The following are the tactic goals of the company:

To increase the revenues by 20% as compared to last year.

To increase the total retail customers by around 10%
To increase the market share by 5%
To reactivate the discontinued customers by 30% (The Pepsi co
Company, 2014).

3 Operational Goals
The operational goals are also set by the Managing Director of the company. Before
implementing these goals the manager consult them with lower level employees and
after convincing them they implement the goals officially. In this type of goals the
company uses Management by objectives (MBO). Every employee assigned is told
about what the organization is expecting from him/her and then his evaluation is
done on the basis of organizations rules and regulations

Supply Chain Operation:

Company makes decision regarding individual customer orders. Th
e g o a l o f s u p p l y c h a i n operations is to handle incoming customer orders in the
best possible manner. During this phase, firms allocate inventory or production to
individual orders, set a date that an order is to be filled, generate pick lists at a
warehouse, allocate to shipping, and set delivery and so on. There is less
uncertainty about demand. At Haidari, the production, sales and supply
chain departments get-together to decide the inventory usually on a weekly
basis.

Process views of a supply chain:

The processes in a supply chain are divided into a series of cycles each performed
at the interface between two successive stages of a supply chain.
Cycle View of Supply Chain:
There are five stages in a supply chain (Supplier
Manufacturer D i s t r i b u t o r R e t a i l e r C u s t o m e r ) a n d f o u r s u p p l y c
h a i n p r o c e s s c y c l e s ( c u s t o m e r o r d e r , replenishment, manufacturing,
procurement cycle).
Push/Pull View of Supply Chain:
With push process execution is initiated in anticipation to a customer order. Pepsi
has a seasonal demand. Just in time concept is applicable in non-seasonal period
and not applicable in seasonal period. All processes that are part of the procurement
cycle, manufacturing cycle, replenishment cycle, and customer order cycle are push
processes. Pepsi Sales order and processing: The Shipping Manager receives sales
order from Sales Team, distributors through telephone, fax & email one day before
dispatch. The sales are made to base distributors on advance payment against
orders then shipping manager plans according to the demand of distributors
on daily basis.
Customer
Retailer
Distributor
Manufacturer Supplier 3
Competitive and Supply Chain Strategies
There are three major sustainable advantages that give PepsiCo a
competitive edgeathey operate in the global marketplace
1.Big, muscular brands, 2.Proven ability to innovate and
create differentiated products and3 . P o w e r f u l g o - t o - m a r k e t s ys t e m s .
PepsiCos overall mission is to increase the
Value of shareholder's investment
They do this through sales growth, cost controls
and wise investment of resources. They b e l i e v e t h e i r commercial
success depends upon offering quality and value to their consumers and
customers; providing products that are safe, wholesome, economically efficient and
environmentally sound ;and providing a fair return to their investors while adhering to
the highest standards
ofintegrity.A c u s t o m e r w h i l e p u r c h a s i n g a b o t t l e o f P e p s i w i l l c o
n s i d e r p r o d u c t q u a l i t y , p r i c e a n d availability of the product. Thus, Pepsi
in Pakistan particularly focuses its competitive strategy as to producing sufficient
variety, reasonable prices, and the availability of the product.

Organizing
Organizing is the second management function. The following steps are taken by the
Coca-Cola Company in organizing their goals and objectives:

Departmentalization
Work Specialization
Delegation and Accountability
Resource Allocation
Organizing the Human Resources

All the steps are discussed below in detail:

1. Departmentalization
On the basis of functional approach the Pepsi Company is divided into different
departments. Grouping of employees is done on the basis of their common skills and
work activities. Such kind of approach helps the company in solving their problems
and it also make the less the need of training the employees specially. The general
manger is head of all the departments all the department have to report to the
general manager in the Pepsi Company. There are five major departments in the
company which are as follow:
 Production Department
Industrial Relations Department
Sales and Marketing Department
Human Capital Department
Finance Department

Production Department: This department looks around all the production of the
company. All plants in the country are in under its control.

Industrial Relation Department: This department deals with the problems of the
employees. The department listen the problems of the employees and send them to
the high authorities for settling them up and stop them from becoming a hurdle in the
work progress of the company.

Sales and Marketing department: This department makes sure that the product is
easily available in the market for the customers to buy and deals with the issues of
advertisement, promotion, and distribution of the product.

Human Capital Department: This department takes care of the efficient workers of
the company, they select some efficient workers of in the company recommend their
names for promotion in job so that the workers remain happy and dont leave the
company. Management level employees are dealt by the department.

Finance Department: The department is concerned with cost and price of the
products produced by the company. It also tackles with import related issues of the
company. Finance department is assisted by the sales and marketing department in
making invoices and payroll entries

Work Specialization
There is a high percentage of work specialization in because every manager is
appointed in the function in which he is expert so there is no boredom or monotony.
All the promotions of the employees are based on their performances. No favoritism
is allowed in the company

Delegation and Accountability

There is a high percentage of delegation in the company. The work is done with
proper authority and responsibility. Every manager is made accountable for the
actions of his subordinates. All the subordinates are guided very keenly by their
respective managers at the time of accomplishing some goal. Keeping the
delegation process on the other side the managers also motivate their subordinates
to boost up their energy and make them more effective by using different methods.
They make their subordinated think that they have to give their best to their
managers which increases their performance, quality of work and satisfaction of the
customers

Resource Allocation
When the issue of resource allocation comes into action the Pepsi Company has
given the authority to managers to use the resources of the company where ever
and whenever they are needed. Only they are required to get the approval from the
manager if those assets belong to his department. The resources can be capital,
labor, machinery or anything else.

Organizing the Human Resources

The company does the recruitment process when there is a position empty and the
recruitment is always done on permanent basis in Pepsi Company.

Recruitment is done when the manger needs the employee under him and he send
the request to the general manager and after the approval of the general manager
the request is sent to the Human Resource Department.

In fir Pepsi style all the vacancies are announced within the organization so that if
there is someone who can fulfill the requirements can get him/herself promoted or
can refer someone of his relative to join if he is capable of that job. If there are no
suitable persons than the company searches its bank where there are huge amount
of application of the applicants. If there also they find no person suitable for the job
then at last they give the advertisement in the newspaper etc.

Leading
The third management function is leading. The following major steps are taken by
the Pepsi Company in the leading function:

Motivation
Communication
Corporate Culture
Motivation
Pepsi Company gives high attention to the motivation of the employees. Promotions
of hardworking employees are a part of the companys policy. Promotions of
employees are done on the performance basis which is a great motivation for the
employee that higher his performance there is more chance of his promotion.

Beside from promotion strategy the Pepsi Company also uses the compensation
strategy to motivate the employee; Pepsi is paying industrial average in
compensation. Not only this different campaigns and competitions between the
employees itself are also used to motivate the employees.

Managers play a very important role in the motivation of the employees in Company.
They help them in all their problems either they are personnel or professional. They
give them feedback on their performance which makes the employee feel good.
Working environment and a challenging milestone are a major factor in employee
motivation in the company

Corporate Culture
The top management of the Pepsi is to follow the prescribed culture of the
organization. Pepsi has formal and documented values that are communicated to all
the employees. The top level manager acts as role models to make sure that the
rules and regulations are been applied in the company and closely administrator
review their employees behavior.

Controlling
The last and the most crucial function of management are Controlling. In this
function the company evaluates that either they have achieved the goals which they
had set before. If the answer is yes then the employees and managers are
rewarded with bonuses and other ways and vice versa. In the following well come
to know that how the Pepsi Company performs its controlling function?
Distribution Channel:-

The company operates through a well-established network of a number of

distributors. The company has two types of delivery systems i.e.

Direct delivery system

1. Indirect delivery system

The basic difference between the direct and the indirect delivery system is that in a
direct distribution system, the company spends its own resources while in a indirect
distribution, the dealers spends their own resources on all the factors which
increased the sale. The company also has its depots in different cities. Which helps a
lot in increasing its sale and directing the distribution system.

SWOT Analysis
Strengths
Strong image of PEPSI in consumers mind

In time service of supplies and technical assistance

More installation of post mix machine

Weaknesses
No advertisement budgets for post mix.

No signages of post mix in the market

No promotional activities in post mix.

No availability of spare parts.

No proper workshop for post mix.

Opportunities
Opening of new outlets

Strong consumer commitment with Pepsi.

Threats
Coca- Cola is on its way to get market share
 FINISHED GOODS STORAGE

Finished goods storage should be secured against sunlight, rainfall, moisture and
other intimidation.

Issued on FIFO (first in, first out) basis via validity of production dates. It
ensures that product is not expired, bad taste and visually unattractive.
Shift wise record of daily transactions is maintained.

These are physical stock taking for physical but not for expiry dates.

HANDLING & PACKAGING

Forklifts are used for transferring FG shells I cases from production area to
shipping hall or not delivery ducks to ensure product do not get damaged.

All Pepsi Cola carbonated soft drinks are packed in glass/PET bottles or post mix
tanks. This is called primary packaging. Filled glass/PET bottles are further secured
by means of plastic or wooden shells/cases called secondary packaging.

RESPONSIBILITIES OF DEPOT INCHARGE

Monitoring of empty and stock in charges

 Maintenance of shipping records and documents
Reconciling physical stock with MIS reports
Posting on balance sheet register
Sending daily stock report and dealer wise sales report to factory
Receiving bank slips from dealers
Clearance of depot's settlement sheet
Transfer of cash to friends agency account
Maintenance of stock FIFO system

During my visit to depot, I studied depot operations and

The job of stock incharge.

Performed the job of empty incharge.

REORDER POINT

Reorder point is calculated on two bases. Firstly they calculate the daily requirement
of the raw material and then they check the level in the stock room. For some items
they maintain the maximum and minimum level when the level of raw material
touches the minimum point they order the raw material. For two main items reorder
points are as following

Sugar is reordered when it is left for only 100-batched or 1000 Kg

Concentrate is ordered for 2 to 3 times a year.

SUPPLY CHAIN MANAGEMENT

Supply-chain management aims at synchronization of a firms activities/ functions
and those of its suppliers to match the flow of materials, service and information with
customer demand.

SUPPLY CHAIN IN PEPSI COLA MULTAN

Supply chain of Pepsi Cola Multan consists of following entities

Raw Material (From Suppliers)

Pepsi Cola Multan (Production Of Products)

Distributors

Retailers

Customers
SUPPLIER SELECTION

The first priority is given to quality while selecting suppliers, by the Company.
Price is considered after quality & delivery time at last.

DISTRIBUTOR SELECTION

Distributors are selected on the following basis

Ability to meet the given target

Geographical area he is covering

RETAILER SELECTION

Retailer is selected on the following basis

Location of the shop

Look of the shop

His know how with the customers

His ability to meet the sales target

DIRECT SALES
Rural areas where there are no distributors, Pepsi Cola Multan goes for direct sales
to retailers. They offer the same price per unit as offered to distributors. In case of
distributors, for transportation truck are also available to transfer creates from
company godowns to distributor godowns.

SATELLITE WAREHOUSE
They are planning for satellite warehouses which will enable them to have flexible
timings for loading and unloading of trucks and storage of products to the customers

LOCATION

Pepsi Cola Multan is situated near MDA (Multan Development Authority), on the road
leading to Nishtar Hospital i.e. District Jail road.

SELECTION OF LOCATION

The major factor was proximity to markets in selection of location.

LOCATION ANALYSIS

The location described above is favorable for Pepsi Cola Multan due to following
factors

MARKET RELATED FACTOR

Pepsi Cola Multan has proximity to its major market i.e. Multan City which has been
declared by Pepsi Company; The Pepsi City This location is very much helpful for
Pepsi Cola Multan, in competition also to maintain proper distribution to reduce
transportation cost & time etc.

TANGIBLE FACTORS

Labor is easily available from villages & city at normal wages. No problem is there
for supply of electricity. Most essential raw material i.e. water is easily available to
them. Transportation cost is low. Multan is the center of their distribution area and
they can easily fulfill the requirements of the southern Punjab areas.

IN TANGIBLE FACTORS
Community attitude is positive towards Pepsi Cola. Working conditions are quite
good for employees i.e. No harm is there for their health & psychology.
PROBLEMS OF CURRENT LOCATION

Factory is located in the residential areas with no proper parking arrangements for its
vehicles. Loading and unloading of trucks can take place only in the night because of
the

law permitting trucks to enter into urban areas only in the night. So they can only
load and unload trucks between 10 PM to 6 AM.

SOLUTION

In order to overcome this problem they are planning for satellite warehouses which
will enable PEPSI to have flexible timings for loading and unloading of trucks and
storage of products closer to the customers.

LAYOUTS

Layout is physical arrangement of economic activity centers within a facility. An

economic activity centre can be anything that consumes space. In other works layout
is physical arrangement of people, equipment or activities.

Three distribution channels

PepsiCo Inc. (PEP) is a leading food and beverage company with an impressive
global presence. The companys products reach the market through the following
three channels: direct store delivery (or DSD), customer warehouse, and third-party
distributor networks. PepsiCo chooses the relevant distribution channel based on
customer needs, product characteristics, and local trade practices.

Direct store delivery

Under the DSD system, PepsiCo delivers products directly to retail stores. Of the
three channels, DSD enables PepsiCo to merchandise with maximum visibility. Its
more suitable for products that are restocked often and are sensitive to promotions
and marketing.

Customer warehouse

The customer warehouse system is a less expensive distribution channel. Its ideal
for products that are less fragile and perishable, have lower turnover, and are not
purchased impulsively.

Third-party distributor networks

PepsiCo distributes food and beverage products to restaurants, businesses, schools,

and stadiums through third-party food service and vending distributors and
operators.

Leveraging its dominant position

PepsiCo is the second-largest nonalcoholic beverage maker in the United States

with a large scale of operations. The companys dominant position helps it enjoy
favorable relationships with its retailers, who allow the company to have major shelf
space. This helps PepsiCo influence consumer shopping patterns and increases the
coincidence of purchase of its complementary food and beverage products.