PROJECT REPORT

ON

“Channel Management Issues of PEPSICO In Navi Mumbai”

IN PARTIAL FULLFILLMENT OF

POST GRADUTE DIPLOMA IN MANAGEMENT

SUBMITTED BY

Mohini Gandhi

ROLL NO: 32

SPECIALISATION: BIOTECHNOLOGY MANAGEMENT

GUIDED BY

PROF. MOUNITA KHASKEL

Pillai’s Institute of Management Studies & Research

New Panvel, Navi Mumbai

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 DECLARATION

I Mohini Gandhi student of PGDM-BFM, Pillai’s Institute of Management Studies

And Research, and Navi Mumbai had done my project on “Channel Management
Issues of PEPSICO In Navi Mumbai”

During June-July (2010) in partial fulfillment of the PGDM-BTM program,

represent my independent work and the report regarding the work wasn’t submitted
to any of the university before by me.

Date: Sept. 6th, 2010 MOHINI GANDHI

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 ACKNOWLEDGEMENT

I acknowledge my gratitude to Prof. Mounita khaskhel who supervised

and guided me to complete this project and to Mr. Sanjiv Nair (TDM), Mr.
Kiran (CE) & Mr.Subhash Chaturvedi (CE) who in their busy schedule
supported me to fulfill this project.

I also thank PEPSICO for giving me opportunity to do my summer

internship and for extending their co-operation in completion of this
project report and PIMSR for giving me the right direction in the academic
life and providing me the useful resources for the project.

TABLE OF CONTENT

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 Sr.no Title Page no.

Chapter - 1
1) Introduction to FMCG Market 6

2) Objective of the study 9

3) Need of the project 10

4) Scope of the project 10

5) Research Methodology 11

6) Limitations of the project 11

Chapter -2
1) Company Profile 13

2) Organisation Chart 25

3) Benefits given by the company 26

Chapter -3
1) Theoretical Background 28

2) Data analysis and Interpretation 31

Chapter -4
1) Findings 42

2) Suggestions 43

3) Conclusion 44

• Bibliography 45

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 Chapter I

INTRODUCTION
FMCG Sector in India

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The FMCG sector represents consumer goods required for daily or frequent use. The main
segments of this sector are personal care (oral care, hair care, soaps, cosmetics, and toiletries),
household care (fabric wash and household cleaners), branded and packaged food, beverages
(health beverages, soft drinks, staples, cereals, dairy products, chocolates, bakery products) and
tobacco.

The Indian FMCG sector is an important contributor to the country's GDP. It is the fourth largest
sector in the economy and is responsible for 5% of the total factory employment in India. The
industry also creates employment for 3 m people in downstream activities, much of which is
disbursed in small towns and rural India. This industry has witnessed strong growth in the past
decade. This has been due to liberalization, urbanization, increase in the disposable incomes
and altered lifestyle. Furthermore, the boom has also been fuelled by the reduction in excise
duties, de-reservation from the small-scale sector and the concerted efforts of personal care
companies to attract the burgeoning affluent segment in the middle-class through product and
packaging innovations.

Unlike the perception that the FMCG sector is a producer of luxury items targeted at the elite, in
reality, the sector meets the every day needs of the masses. The lower-middle income group
accounts for over 60% of the sector's sales. Rural markets account for 56% of the total domestic
FMCG demand.

Many of the global FMCG majors have been present in the country for many decades. But in the
last ten years, many of the smaller rung Indian FMCG companies have gained in scale. As a
result, the unorganized and regional players have witnessed erosion in market share.

History of FMCG in India

In India, companies like ITC, HLL, Colgate, Cadbury and Nestle have been a dominant force in

6
the FMCG sector well supported by relatively less competition and high entry barriers (import
duty was high). These companies were, therefore, able to charge a premium for their products.
In this context, the margins were also on the higher side. With the gradual opening up of the
economy over the last decade, FMCG companies have been forced to fight for a market share.
In the process, margins have been compromised, more so in the last six years (FMCG sector
witnessed decline in demand).

Current Scenario
The growth potential for FMCG companies looks promising over the long-term horizon, as the
per-capita consumption of almost all products in the country is amongst the lowest in the world.
As per the Consumer Survey by KSA-Techno Park, of the total consumption expenditure, almost
40% and 8% was accounted by groceries and personal care products respectively. Rapid
urbanization, increased literacy and rising per capita income are the key growth drivers for the
sector. Around 45% of the population in India is below 20 years of age and the proportion of the
young population is expected to increase in the next five years. Aspiration levels in this age
group have been fuelled by greater media exposure, unleashing a latent demand with more
money and a new mindset. In this backdrop, industry estimates suggest that the industry could
triple in value by 2015 (by some estimates, the industry could double in size by 2010).
In our view, testing times for the FMCG sector are over and driving rural penetration will be the
key going forward. Due to infrastructure constraints (this influences the cost-effectiveness of the
supply chain), companies were unable to grow faster. Although companies like HLL and ITC
have dedicated initiatives targeted at the rural market, these are still at a relatively nascent
stage.
The bottlenecks of the conventional distribution system are likely to be removed once organized
retailing gains in scale. Currently, organized retailing accounts for just 3% of total retail sales and
is likely to touch 10% over the next 3-5 years. In our view, organized retailing results in
discounted prices, forced-buying by offering many choices and also opens up new avenues for
growth for the FMCG sector. Given the aggressive expansion plans of players like Pantaloon,
Trent, Shopper’s Stop and Shoprite, we are confident that the FMCG sector has a bright future.

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India is one of the world’s largest producers for a number of FMCG products but its FMCG
exports are languishing at around Rs 1,000 crore only. There is significant potential for
increasing exports but there are certain factors inhibiting this. Small-scale sector reservations
limit ability to invest in technology and quality up gradation to achieve economies of scale.
Moreover, lower volume of higher value added products reduce scope for export to developing
countries.

The FMCG sector has traditionally grown at a very fast rate and has generally outperformed the
rest of the industry. Over the last one year, however the rate of growth has slowed down and the
sector has recorded sales growth of just five per cent in the last four quarters.

Objective of the project

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“To Correct channel management issues for Pepsico in Navi Mumbai with special reference to
areas Nerul, CBD Belapur, Kharghar, Kamothe, Kalamboli”.

Objectives

1) In depth analysis of area wise distribution of channels of PepsiCo in Nerul, CBD Belapur,
kharghar, Kamothe, Kalamboli.

2) To do comparative analysis of channel management strategy of Pepsi and coke.

3) Figure out the major channel management issues.

4) To find out the opportunities available for PepsiCo improve the distribution channel.

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 Need of the project

As the FMCG market is growing and also more and more companies are entering the market,
PepsiCo has to improve in every field from marketing to distribution, from Sales to
accounting. Distribution and marketing being important factors in company’s growth, PepsiCo
has to improve or change their strategies with the growing industry. This project is about
knowing the distribution channel of the company, where the company lacks, Where the
company needs to improve and where there is a chance of expansion.

Scope of the Project

This Project helped me in knowing the distribution and sales of PepsiCo holdings and how they
work. This Project will be helpful for those who in future might come across a project related to
distribution channels in any FMCG company.

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 Research Methodology

DATA COLLECTION

1) Primary Source

 Retailers

 Wholesellers

 Distributors

2) Secondary Source

 Pepsi Co site

RESEARCH INSTRUMENTS

. FAQs (Frequently asked questions)

Limitations of the project :

There were only few limitations for me in my project.

 The area to be surveyed was only Navi Mumbai.

 The other one was that I had to only communicate with the employees of the company and
the retailers.

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Chapter II

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 Company Profile

 Type Public (NYSE: PEP)

 Headquarters New York, USA

 Key people Indra Nooyi, Chairwoman, President & CEO

 Industry Food and beverage

 GROUP OF COMPANIES

 Frito-Lay North America

 PepsiCo Beverages North America,

 PepsiCo International

 Quaker Foods North America

 PepsiCo India Holdings

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Mission

The main objective is to provide best quality products to its customers. Another objective is to
provide healthy rewards to its investors, good reward to its employee and other investor and
partners who financially help the company.

Vision
The vision of the company is to improve in all aspects in which they operate. By improving in
social and economical environment, they want to make tomorrow better than today.

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 PEPSICO INDIA

PepsiCo gained entry to India in 1988 by creating a joint venture with the Punjab government-
owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited. This joint venture
marketed and sold Lehar Pepsi until 1991, when the use of foreign brands was allowed;
PepsiCo bought out its partners and ended the joint venture in 1994. Others claim that firstly
Pepsi was banned from import in India, in 1970, for having refused to release the list of its
ingredients and in 1993, the ban was lifted, with Pepsi arriving on the market shortly afterwards.
These controversies are a reminder of "India's sometimes acrimonious relationship with huge
multinational companies." Indeed, some argue that PepsiCo and The Coca-Cola Company have
"been major targets in part because they are well-known foreign companies that draw plenty of
attention."

In 2003, the Centre for Science and Environment (CSE), a non-governmental organization in
New Delhi, said aerated waters produced by soft drinks manufacturers in India, including
multinational giants PepsiCo and The Coca-Cola Company, contained toxins, including lindane,
DDT, malathion and chlorpyrifos — pesticides that can contribute to cancer, a breakdown of the
immune system and cause birth defects. Tested products included Coke, Pepsi, 7 Up, Mirinda,
Fanta, Thums Up, Limca, and Sprite.

The Coca-Cola Company and PepsiCo angrily denied allegations that their products
manufactured in India contained toxin levels far above the norms permitted in the developed

15
world. But an Indian parliamentary committee, in 2004, backed up CSE's findings and a
government-appointed committee, is now trying to develop the world's first pesticides standards
for soft drinks. Coke and PepsiCo opposed the move, arguing that lab tests aren't reliable
enough to detect minute traces of pesticides in complex drinks. On December 7, 2004, India's
Supreme Court ruled that both PepsiCo and competitor. The Coca-Cola Company must label all
cans and bottles of the respective soft drinks with a consumer warning after tests showed
unacceptable levels of residual pesticides.

Both companies continue to maintain that their products meet all international safety standards
without yet implementing the Supreme Court ruling.[citation needed] As of 2005, The Coca-Cola
Company and PepsiCo together hold 95% market share of soft-drink sales in India. PepsiCo has
also been alleged[attribution needed] to practice "water piracy" due to its role in exploitation of
ground water resources resulting in scarcity of drinking water for the natives of Puthussery
panchayat in the Palakkad district in Kerala, India. Local residents have been pressuring the
government to close down the PepsiCo unit in the village.

In 2006, the CSE again found that soda drinks, including both Pepsi and Coca-Cola, had high
levels of pesticides in their drinks. Both PepsiCo and The Coca-Cola Company maintain that
their drinks are safe for consumption and have published newspaper advertisements that say
pesticide levels in their products are less than those in other foods such as tea, fruit and dairy
products. In the Indian state of Kerala, sale and production of Pepsi-Cola, along with other soft
drinks, has been banned. Five other Indian states have announced partial bans on the drinks in
schools, colleges and hospitals.

Now, PepsiCo India targeting young population of India by taking young crowd and young
celebrities in their advertisements as brand ambassador like Ranbir Kapoor.

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THE MARKETING MIX-4 P’S WITH SPECIAL REFERENCE TO PEPSI:

Product:
A business needs to consider the products that it produces and the stage of the product life
cycle that a product is at. Marketing strategies will vary according to the type of product and its
stage in the life cycle.

In case of Pepsi, in the rural markets, the 300ml bottle and now days the new small or
commonly known as the “chota Pepsi” is very much popular. The Pepsi Co. is even thinking of
introducing their new Pepsi-Aha, but presently they are concentrating more on the normal Pepsi
as the rural market is a niche market. Pepsi is even successful in introducing the big 1-1.5 liter
PET bottles in the rural markets. These big bottles are very popular during big festivals and
marriages.

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Price:

Most businesses use a "cost plus" method for setting the prices of their products. This involves
determining unit production costs and then adding in a profit margin. However, many other
factors are involved. Consider "perceived price" (what you think consumers will be prepared to
pay), demand elasticity (is it elastic or inelastic?), competitors' pricing (can you afford to
undercut their prices?), pricing objectives (what do you want to achieve Ð increased market
share? increased profits? market leadership? etc.)

As far as the pricing goes, the 300 ml Pepsi bottle is priced at Rs. 10. But the company soon
realized that this pricing worked in the urban markets but not in the rural markets as in the rural
markets, Pepsi is not a necessity but a luxury. They found out that people in the rural markets
bought cold drinks only if there was some occasion. A price point of Rs 10 for a 300 ml bottle
has proved a major deterrent: it has kept away new consumers in the urban and semi-urban
pockets, and it has blanked out the far larger rural markets where annual per capita consumption
is less than a bottle. So the Rs. 10 bottle was not that successful. But their sales increased after
introducing the “chota Pepsi”.

This 200ml Pepsi was reasonably priced between Rs.5- Rs.7. This was a major weapon for the
expansion of the rural market. Pepsi expects the small-size offering to account for 30 per cent of
volumes this year compared with 18 per cent last year. But there are other areas of concern —
principally that the 200 ml offering should not cannibalize 300 ml sales.

In that case, there will be no market growth. That is why pricing could be crucial. Pepsi, for
instance, has reckoned that giving consumers 33 per cent (100 ml) less cola at 50 per cent of
the price (Rs 5) is not a sustainable option and can, at best, be used as an introductory offer.
The conclusion is based on hard facts. Last year, the beverage giants test-marketed 200 ml
bottles at a price of Rs 5. Instead of growth, Pepsi discovered that 300 ml drinkers merely shifted
to the 200 ml variant, the market remained stagnant and everyone lost money. The conclusion
was clear: cutting prices does not necessarily expand the market.

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Place

This generally refers to the physical locations of product sales as well as the methods of
distribution. However, it is also considered to be the "place" or "position" in the market of the
product; refer to information below. Businesses need to make many decisions related to "place":
access, parking, competition, physical location etc.

It’s the most important P in the cola wars — Place. And nothing evokes more passion in Pepsi
and Coke than distribution. Major innovation is underway on the distribution front at Pepsi, pre-
selling being the biggest of all. It’s been successfully test marketed in Bangalore, Baroda and
Coimbatore — and may soon roll out nationally.

In case of the distribution network, there is no involvement of wholesalers in the distribution of

products. 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 franchise
bottles.

In the current system, the strike rate in the Delhi market is about 40 per cent, which can be
improved to 80 per cent in the peak season, claims a franchise director. The result for Pepsi
could be significant savings.

“Colas service just 7.5-8 lakh accounts compared to the other FMCG players who service three
times the number. Innovation in our distribution system will take us closer to the 21 lakh figure,”
says Vats, a franchise director.

Pepsi believes in direct distribution whereas Coke doesn’t. It mainly concentrates on dealers
and most importantly cutting costs. “There are plenty of innovations possible in distribution that
can cut costs”, says a Pepsi official.

For Pepsi, the rural market is a chosen thrust this year. It has targeted to reach 20 to 28 per cent
of the rural population in the first year of this operation. In the first stage, the corporation is

19
planning a massive roll out in villages with populations of 5000. To do this effectively, Pepsi is
focusing on establishing a cold chain

The company has developed special freezers that allow its products to stay chilled despite
power cuts of three to four hours. It will also use traditional iceboxes to sell its product in rural
India. For the rural markets, Pepsi is looking at the wholesale route since the logistics of direct
distribution are too huge to handle in the interior.

Promotion

This refers to the promotion of the product to the target market. This is achieved through a
combination of: advertising: use of electronic and print media. The "reach" (how many people
will see the advert), frequency (how many times will I advertise the product?) and impact of the
advertising must also be evaluated.

Due to the cola wars promotion, and advertising has always been an integral part for both the
cola cos: Pepsi and Coke. But for the first time perhaps in the history of cola wars, the strategies
of the two giant cos are diverging in India. Whether it’s business or product strategies or the
critical distribution game plan, the archrivals are taking roads that do not meet. Mr. Bakshi of
Pepsi Co. is bringing a change in their distribution and marketing strategies.

Now days where Coke is concentrating more on the 200ml bottle, Mr. Bakshi of Pepsi says “The
200ml bottle gets zero demand in the rural market.” He is concentrating on the 1.0 liter bottles of
Pepsi. The Pepsi Co. had used an excellent marketing strategy here. During the Lagaan mania
they were distributing free tickets in the rural markets along with their 1.5-liter PET bottles. Pepsi
made this 1.5-liter PET bottle very famous for their special festive occasions and marriage.

Well the popularity of the product has also increased due to their advertisements or basically
famous cricket and bollywood personalities endorsing this product. For instance the Sachin
“Aala re Aala” advertisement where even he is wearing a mask along with those rural kids. Or
you can even take the new Sachin and Amitabh Bachchan advertisement where both of them
say “Yeh Dil Maange More!!!!!!!” Sachin has done many advertisements for Pepsi in the span of
10 years.

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Pepsi’s rural market advertisement- Pepsi has unveiled a major campaign in Andhra Pradesh,
roping in top Telugu film star, Pawan Kalyan, even as the star's elder brother, Chiranjeevi, is into
pushing Coca-Cola's Thums Up. Pawan Kalyan, however, ruled out any rivalry between him and
his brother. Though he will sing Yeh Dil Maange more, his brother will say Yeh Dil Maange no
more. “Pepsi also kicked off a rural campaign, spread over two months. Decorated Pepsi vans
will roll out into market of the State. Every consumer drinking a Pepsi from these vans will get to
play a game and win prizes. These include Pawan Kalyan memorabilia, T-shirts, autographed
posters and calendars.

Explaining the reason for choosing Pawan Kalyan to endorse Pepsi, Mr. Rohit Ohri, Director
HTA, Pepsi's ad agency, said Pepsi and Pawan Kalyan were going to be an ideal combination.
“Both are so youthful, energetic and fun-loving,” he said. Mr. Vijay Shanker Subramanian, Vice-
President (Marketing), Pepsi Foods Ltd, said the company was starting an “aggressive
campaign” in Andhra Pradesh. Apart from the van operations, which were flagged off by Pawan
Kalyan, other campaigns have been lined up throughout the year.

Pawan Kalyan presented a cheque for Rs 5 lakh to Mr. Mehmood Ali, a mechanic with the
Andhra Pradesh State Road Transport Corporation for winning Pepsi's Mera number ayega
campaign.

Lastly, Though Coke ranks 1st with 57 % of the market share (which includes Thums –up
too),Pepsi ranks 2nd with 43% of the market share. The Pepsi Co. has fought a bitter struggle
upwards starting from a zero market share. When Pepsi entered the market in 1989, they faced
the daunting task of pacifying Indian swadeshi activists alone. Their trucks were smashed and
offices ransacked so as to dissuade them from entering the Indian market. Whereas when Coke
entered the Indian market in 1993, the situation had been smoothed out by Pepsi already, and
the atmosphere was extremely conducive to foreign multinationals coming to India

Therefore, though Coke ranks 1st, it got this position only after introducing the Parle products
who already had a 70% market share . Presently Pepsi Co. is also concentrating on its other
products like slice, mirinda and aquafina. Their next aim is to popularize their other products like
sodas, then the new Pepsi Aha- the apple drink and beat coke to become the new market
leader.

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 PEPSICO’S DISTRIBUTION SYSTEM

PepsiCo’s Plant

Indenti
ng
Distributor
Primary
Sale

Market /
Secondar
Retailers y Sale

Consumer

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 PEPSICO’S PRODUCTS

Following are main products of PepsiCo (India) pvt limited.

 Pepsi

 Mirinda Orange

 Mirinda Lemon

 7 Up

 Mountain Dew

 Slice

 Pepsi Diet

 Lehar Soda

 Aquafina

 Tropicana

 Gatorade

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  Lays

 Kurkure

RETAIL CHANNEL

These are the channel that Pepsi target for supply of its product.

Conveni
ence Convenience channel includes
different kiosks are which is convenient

Channel to general public.

Grocery
Channel Grocery channel includes different
grocery shops.

Eatery
Channel Eatery channel includes different
hotels, restaurants etc.

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Organisation Chart

25
 Benefits Given by the Company
 I was provided with allowances for lunch.

 They also provided with leisure activities on work time.

 Stationary and other related things were provided from the organization.

 Travelling expenses benefits were provided from them.

 I was paid `2000 per month as stipend by the organization.

 They also provided a separate workplace in the office.

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Chapter III

27
 Theoretical Background
VAIBHAVI ENTERPRISES (Agency of Pepsi)

A Vaibhavi enterprise is an agency for Pepsi which supply Pepsi products mainly soft drinks to
the retailer or to the shops. The warehouse is in Turbhe which is in Navi Mumbai Maharashtra.
There are only two warehouses of the company in Navi Mumbai and Vaibhavi is one of them
which cover large amount of area.

Vaibhavi Ent. Covers area like Vashi, Sanpada, Juinagar, Seawoods, Koper Khairane, Airoli,
Ghansoli, Nerul, C.B.D. Belapur, Kharghar, Turbhe, Taloja, Mumbra, Shiravane.

Each and every area which Vaibhavi covers is an important area because it gives good business
to the company.

Vaibhavi Enterprise has its own way of doing business. They always try to greet their customers
by giving them good schemes and services.

 Working of employees
There are around 20-25 employees other than labours and drivers who are working in Vaibhavi
enterprise. These people directly deal with the shopkeepers in the market. The employees who
deals and supply the product to the market are called PSRs. These PSRs work under C.E.

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There are 3 C.E. in Vaibhavi enterprise Mr. Anuj, Mr. Kiran and Mr. Rajiv. C.E.s have to report
to A.D.M that is the head of the area and that Mr. Amit Joshi.

These three were the head in the Vaibhavi. There are PSRs who used to work under a C.E.
Each and every PSRs has allotted a C.E. and he is the boss for them.

All PSRs use to get their monthly target at the starting of the new month and according to that
they do their daily work. They divide their monthly target in weeks and days, it makes their target
clear. Target for them is to sell total number of crates.

For selling the product each and every PSR has its own fix area and fix route. He has to cover
all the shops which comes under his area. Some times its very difficult to cover all shops which
comes under his area. The PSRs has to make vendor happy and has to provide him service on
regular time otherwise the vendor may shift to other company which is Coca Cola. It reduces the
market share of the company.

Pepsi company gives different schemes on the products for its customers so that company can
make good profits. C.E. of Vaibhavi updates its PSRs in regular interval so that they can make
good sell for the company.

There are some PSRs who used to take order first and than go for the delivery and some of
them directly go with the products and if the shopkeeper needs the product the delivered it to
him.

PSRs use to come to the warehouse and they decide how much quantity they have to sell for
that particular day and according to that they load their truck. After completing the delivery of a
day the PSRs come to warehouse again and make an entry on a chart. This chart keeps a
record of each and every PSRs activity, their sales, etc. After making an entry PSRs have to
submit the amount that they collected from the vendors while delivery in the office and than only
they can go home.

29
Pepsi Company provides coolers for its vendors so that they can sell more number of products.
For that Vaibhavi do documentation and agreement work and they always try to provide them
the cooler as soon as possible because it capture more market share for the company.

SAMPLING PLAN

1) Sampling Unit: Who is to be surveyed?

· Retailers, Wholesellers,

2) Sample Size: How many people to be surveyed?

· All retailers in the area

For performing the task in detail I have been given all the retailers wholesalers who sells soft
drinks. These outlets include hotels and restaurants, bars, grocery shops, etc.

By considering these report I have to find out how many market does Pepsi is covering and in
how many outlets Pepsi and coke have their monopoly. If there is any coke monopoly than I try
to break it by starting Pepsi there. And even if the outlets required visi cooler and he is ready to
start Pepsi I confirmed the deals.

The areas that I covered for this project are, Nerul, CBD Belapur, Kharghar. Kamothe, kalamboli.
I have covered 865 outlets who sells soft drinks.

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 DATA ANALYSIS AND INTERPRETATION

NERUL & SEA WOODS AREA

31
 PIE CHART OF VISI COOLER

In this region, Coca cola has more market share (185) compared to Pepsi (153) in terms of Visi
coolers but there is a market (43) which don’t have either of the coolers or their personal, so
Pepsi should tap this market to gain more market than rival Coca cola.

NERUL & SEA WOODS AREA

32
 PIE CHART OF MARKET SHARE

Above Chart explains that either Pepsi or Coca cola can be seen at 70 and 82 stores
respectively and also there are stores where both Coca cola and Pepsi are sold but market
share of Coca cola (41) is more than that of Pepsi (23). Also, there are 39 stores where cold
drinks are not sold, so again an opportunity for Pepsi to gain market share in this region.

CBD BELAPUR AREA

PIE CHART OF VISI COOLER

33
Above Chart explains that there are stores where only Pepsi Visi coolers can be seen at most of
the stores(65) compared to other soft drinking companies like coca cola which has individual
market of 44% and also only 1% stores don’t have coolers of any soft drink company.

CBD BELAPUR AREA

34
 PIE CHART OF MARKET SHARE

From the above chart, it can be interpreted that Pepsi has more market share (47%) than rival
Coca cola which is good market share, But still there is 55% of market where either only Coca
cola is sold or both are sold but with a tough competition. So, got a chance to improve in those
areas.

KHARGHAR AREA

35
 PIE CHART OF VISI COOLER

In kharghar, there are in all 205 shops out of which 53 shops have visi of PepsiCo, 58
shops have visi of coca cola and rest 94 shops don’t have visi of pepsi and coca cola or
have their personal visi.

KHARGHAR AREA

36
 PIE CHART OF MARKET SHARE

Above chart explains that either Pepsi or coca cola can be seen at 57 and 39 stores respectively
and also there are stores where both Pepsi and coca cola are sold but market share of Pepsi
(57) is more than that of coca cola (39).Also there are 33 stores where cold drinks are not sold,
so again an opportunity for Pepsi to gain market share in that region.

KAMOTHE AREA

37
 PIE CHART OF VISI COOLER

In Kamothe region, 35% stores have Pepsi coolers compared to 32% which have Coca cola
coolers but there is a large area which doesn’t have company coolers or their personal ones
which is a potential region.

KAMOTHE AREA

38
 PIE CHART OF MARKET SHARE

In Kamothe area, Pepsi has individual market share of 20 and Coca cola of 19. Also , 31 stores
are where both have equal market share but there is a large market which don’t sell cold drinks
(44).

KALAMBOLI AREA

39
 PIE CHART OF VISI COOLER
In this region, Both Pepsi and Coca cola have market share of 35 and 33 respectively, But there
are stores where no coolers of either companies or their personal coolers can be seen (22), So
this is a large untapped market in terms of Coolers.

KALAMBOLI AREA

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 PIE CHART OF MARKET SHARE

Here, it can be interpreted that both Pepsi (18) and Coca cola (15) give tough competition to
each other in stores where only one company is selling their products and some places where
both are sold and both share nearly equal market share and also in some cases (18), there are
places where cold drinks are not sold which can be seen as potential market for Pepsi.

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 Chapter IV

Findings
 PepsiCo provides extra perks to the retailers to display their bottles in the stores.

 Supply Chain of Coca cola is much better compared to PepsiCo.

 After sales service of Cooler is not proper.

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 Advertising is also better in case of Coca cola compared to PepsiCo as they provide with
new banners and advertising danglers frequently.

 Price discounts and new schemes are frequently provided to retailers in case of Coca
cola and PepsiCo lacks behind.

 Pre-sell representatives (PSR) frequently visit retailers to get the feedback in case of
Coca cola but not in case of PepsiCo.

 PepsiCo PSR’s are not providing schemes honestly to the retailers as told by the
retailers.

 Retailers are not aware about the company schemes and product development.

 PepsiCo and Coca cola don’t provide Visi coolers to their retailers in most of the areas.

 Retailers are highly dissatisfied with the salesman behavior.

Suggestions

 Monthly inspection should be done to find out the problem of the customers without
making the distributors aware about it

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 Schemes should be provided to the customers i.e. retailers and not the wholesellers.

 Salary of the sales force should be increased so that they loyal to the company.

 Agency should be more honest in providing benefits to the retailers.

 The company should directly be in contact with the retailers so that they can forecast
demand in that particular store.

 The company should frequently provide the retailers with the accessories like banners
and advertising danglers.

 The company has opportunity to grow market in the untapped regions where neither
pepsi nor Coca cola is providing service.

 Also, they should provide Visi coolers in those stores where its not available as
customers visit any store due to subliminal perception.

 If any distributor truck is not able to reach particular area on time then there must be an
alternative way to transport the product to that place.

 Also, If the company has some expansion plans then they should contact institutes
where in canteen don’t have Pepsi products.

 And, they can also tie up with corporate offices Siemens in kharghar, Wipro in belapur
and provide cold drinks on daily basis.

Conclusion

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The project on channel management issues in PepsiCo shows that they need to improve
the supply chain and also put in more efforts in bringing in new schemes. The market for
cold drinks is getting tough competition from other drinks like Frooti, Appy, Minute maid
etc. which will definitely reduce PepsiCo market share. So, PepsiCo has to work on the
issues related to distributing channel and advertising in stores to gain market share.

Webliography

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 http://pepsicoindia.co.in/

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