You are on page 1of 10

PEPSICO LTD

PEPSI ENTRY IN INDIA


In May 1985 joint venture with R P Goenka

(RPG) group. Pepsi agreed to export juice from north Indian state Punjab. Government rejected a proposal on two basis
Cause regarding a import of cola concentrate Use of foreign brand name Pepsi.

PEPSI PROMISESS
Company create a jobs of 50,000 over nation and

25,000 in Punjab. Foreign brand name would not be used. agricultural research centre would be established. Company focus 75% on agro processing and 25% on investment. Company will bring advanced food processing technology in India and also boost Indian products in international market. Export import ratio would be 5:1

Keep some, Break Some


Pepsi claimed it provided 26000 employment

50% of employers are working on concentrate

and bottling business and not on food processing business. As a name Lehar Pepsi, Pepsi was given prominent position while Lehar had given background position.

Problems Faced
Pepsi took long time to convince farmers to work

with company as a contract farming. For payment, 80% of farmer did not have their bank account. In 1990, crops was harvested but Zahura plant is not ready to start a production. Pepsi failed to export 50% of its production. Pepsi paid farmers par kg less than a market value and chosen only large farmers, got such a comments.

AFTER LIBERALISATION
Removed investment in Soft Drinks business

25% of the overall investment and required it to export 50% of its production. 1994 Pepsi bought of its partner in the venture, while Voltas sold off its stake completely. Company established a wholly owned subsidiary, PepsiCo. Holding India Pvt.Ltd.(PHI)

CONTRACT FIRMING
Tomato(1991)

Chili(1997)
Basmati rice(Oct-1999) Ground nut(2000)

ENTRY STRATEGIES OUTSIDE INDIA


MERGERS:
In 1965, Pepsi employed another marketing

strategy which was company expansion. They merged with Frito-Lay, the most popular snack brand in the world. PepsiCo was formed. Pepsi took care of the beverages while Frito-lay manned the snacks. In 1966, PepsiCo settled into the Eastern European and Japanese markets. They also introduced new products; Diet Pepsi and Mountain Dew.

Acquiring Business
Bought Taco Bell and Pizza Hut and exerted effort into

developing overseas restaurant ventures.


Cheaper
In Canada, they maintained their target audience

through the image of Pepsi being the Poor Mans Soda. Most of their early consumers in Canada belonged to the middle class, and Pepsi is still known as the preferred drink of these people there up until now.

Alliances Pepsi is also active in securing alliance deals with other big corporations. This is a merger-like strategy proven to be effective in marketing. For example, Pepsi has closed an alliance with Warner Brothers International Theaters and with Major League Baseball. Warner Brothers has granted Pepsi exclusive pouring rights, which means it is the only drink served in all the Warner Brothers International Theatres.