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COVERING PAGE


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CERTIFICATE FROM EMPLOYER


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Acknowledgement


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CONTENTS


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EXECUTIVE SUMMARY

Today, the business market is showing extreme volatile and dynamic behaviour. With the rapid

change in technology, complex consumer behaviour, growing competition and high level ofdiversification, it is very important for any business to study the trends in the market and alignwith it to make progress in a dynamic environment.

Hence for the learning and understanding of the market trends, variables and factors, thecompany gave me a project to forecast the sales per brand per back for the beverages that weresold in the Delhi-NCR region for the SKUs of the Brand Coca-Cola which had a bothquantitative and qualitative viability.

In view of the inherent accuracies in the process of forecasting there arises the question why isforecasting necessary? The answer is that all organizations operate in an atmosphere ofuncertainty but decisions have to be made today that affects the future of the organization.

Educated guesses about the future are more valuable than uneducated guesses. There arevarious ways of making forecasts that rely on logical methods of manipulating data that have

been generated by historical events.

However, it is also important to note that judgment, common sense and intuition play s a partin the real world in forecasting process and the mix of qualitative and quantitative techniquesused in forecasting methods and techniques. The need for forecasting also arises because in thisdecade of rapid changes in technology, government involvement in the economy, social and

political changes it is necessary to predict the macro and micro changes as accurately aspossible to survive and grow in a dynamic and uncertain world.

Also with the help of these forecasts the business can plan about different function likedistribution channel, advertising, production and others so as to stay up to date and have theminimum possibility of errors and losses.

Hence in the research I was requires to prepare sales forecasting model for the Delhi NCRregion which not only had a statistical and quantitative approach but also a qualitative andanalytical dimension of the market variables and trends.


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INTRODUCTION

In the modern urban culture consumption of soft drinks particularly among younger generationhas become very popular. Soft drinks in various flavours and tastes are widely patronized byurbane population at various occasions like dinner parties, marriages, social get together,

birthday calibration etc. children of all ages and groups are especially attracted by the mere

mention of the word soft drinks.

With the growing popularity of soft drinks, the technology of its production, preservation,transportation and or marketing in the recent years has witnessed phenomenal changes. The so-called competition for this product in the market is from different other brands. Mass media,

particularly the emergence of television, has contribute to a large extent of the ever growingdemand for soft drinks the attractive jingles and sport make the large audience remember this

product at all times.

It is expected that with the sort of mass advertising, reaching almost the entire country andoffering various varieties annual demand for the product is expected to rise sharply in the timesto come. In any marketing situation, the behavioural / environmental variables relating to

consumers, competition and environment are constantly influx. The competitors in a givenindustry may be making many tactical manoeuvres in market all the time. They may introduceor initiate an aggressive promotion campaign or announce a price reduction. The marketingman of the firm has to meet all these manoeuvre and care of competitive position of his firmand his brand in the market. The only route open to him for achieving this is the manipulationof his marketing tactics. In todays highly competitive market place, three players havedominated the industry; The New York based Pepsi Company Inc. The Atlanta based Coca-cola and U.K. based Cadbury Schweppes. Through the globe, these major players have been

battling it out for a bigger chunk of the ever growing soft drink market. Now this battle hasbeen evolved up to India too with the arrival of these three giants.

Soft drink industry is on amazing growth; ultimately these are only one person who will

determine their fortunes- The Indian consumer. The real War to quench his thirst has justbegun.


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SOFT DRINK INDUSTRY: AN OVERVIEW

It all began in 1886, when a tree legged brass kettle in Hohn Styth Pembertons backyard in Atlanta was brewing

the first P of marketing legend. Unaware the pharmacist has given birth to a caramel coloured syrup, which is now

the chief ingredient of the worlds favourite drink. The syrup combined with carbonated the soft drink market. It is

estimated that this drink is served more than one thousand million times in a day. Equally oblivious to the historic

value of his actions was Frank Ix. Robinson, his partner and book keeper. Pemberton & Robinson laid the first

foundation of this beverage when an average nine drinks per day to begin with, upping volumes as sales grew.

In 1894, this beverage got into bottle, courtesy a candy merchant from Mississippi. By the 1950s Colas

was a daily consumption item, stored in house hold fridges. Soon were born other non- cola variants of

this product like orange & Lemon. Now, the soft drink industry has been dominated by three major

player (1) The New York based Pepsi co. Inc.(2) The Atlanta based coca cola co. (3) The united

Kingdom based Cadbury Schweppes.

Although out the glove these major players have been battling it out for a bigger chunk of the ever-

growing cold drink market, now this battle has begun in India too. India is now the part of cold drink

war. Gone are days of Ramesh Chauhan, Indias one time cola king and his bouts of pistol shooting.

Expect now to hear the boon of cannons when the Coca Cola & Pepsi co. battle it out for, as the Jordon

goes a bigger share of throat. By buying over local competition, the two American Cola giants have

cleared up the arena and are packing all their power behind building the Indian franchisee of their globe

girdling brands. The huge amount invested in fracture has never been seen before. Both players seen an

enormous potential in his country where swigging a carbonated beverage is still considered a treat,

virtually a luxury. Consequently, by world standards Indias per capita consumption of cold drinks as

going by survey results is increasing dramatically however it is still less than over neighbours Pakistan

& Bangladesh, where it is four times as much.

The success of soft drink industry depends upon 4 major factors viz.

Availability

Visibility

Cooling

Range

AVAILABILITY

Availability means the presence of a particular brand at any outlet. If a product is not available at any

outlet and the competitor brand is available, the consumer will go for the latter because generally the

consumption of any soft drink is an impulse decision and not predetermined one.


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VISIBILITY

Visibility is the presence felt, if any outlet has a particular brand of soft drink say- Coca Cola and this

brand is not displayed in the outlet, then its availability is of no use. The soft drink must be shown off

properly and attractively so as to catch the attention of the consumer immediately Coca Cola achieves

visibility by providing glow signboards, hoarding, calendars etc. to the outlets. It also includes various

stands to display Pepsi and other flavours of the company.

COOLING

As the soft drinks are consumed chilled so cooling them plays a vital role in boosting up the sales. The

brand, which is available chilled, gets more sales then the one which is not, even if it is more preferred

one.

RANGE

This is the last but not the least factor, which affects the sale of the products of a particular company.

Range availability means the availability of all flavours in all sizes.

COMPANYPROFILE

Keeping in view of tapping the Indian soft drink market and also developing soft drinks as a drinking

product among Indians. The Coca-Cola in India has setup an independent organizations which is H.C.C

& B.C.C with a capital of 350 U.S.$ each by virtue of sell-out decision of the passed managing director

Sh. S. C. Aggarwal. Hindustan Coca-Cola bottling (N-W) Pvt. Ltd. Najibabad took the complete

possession of this plant, land, machinery, & intellectuals on February 14 1998 and since then H.C.C,

looking after all its affairs under company owned bottling plant to establish integrated marketing system

in the area.

COREBRANDS:

Coca-Cola: Developed in a brass pot in 1886, coca-cola is the most recognized and admired trademark

around the globe. Not to mention the best selling soft drink in the world.


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Sprite: In 1961, a citrus-flavored drink made its U.S debut, using Sprite Boy as inspiration for its

name. This elf with silver hair and a big smile was used in 1940s advertising for Coca-Cola. Sprite is

now the fastest growing major soft drink in U.S and the worlds most popular lemon-lime soft drink.

Fanta:The name fanta was first registered as a trademark in Germany in 1941 ,when it was used for

a few year for a soft drink created from available materials and flavors . The name was then revived in

1955 in Naples, Italy, when it was used for the: fanta orange drink we know today. It is now the

trademark name for a line of flavored drinks around the world.

Diet coke:The extension of the coca-cola name began in 1982 with the introduction of diet coke (also

called coca-cola light in some countries). Diet coke quickly become the number one selling low

calorie soft drink in the world.

BRANDININDIANORIGIN

LIMCA: It is thirst-quenching beverage features a fresh and light lemon-lime taste and lighthearted

attitude. The limca brand was introduced in 1971 and acquired by the coca-cola company in 1993.

MAAZA: Maaza, launched in 1984 and acquired by the coca-cola company in 1993, is a non

carbonated mango soft drink with a rich, juict & natural mango taste.

THUMPSUP:in 1993, the coca-cola company acquired this brand, which was originally introduced in

1977. Its strong and fizzy taste makes it unique carbonated Indian cola.


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BRANDS IN INDIA

HISTORY OF COCA-COLA

Jon Styth Pemberton first introduced the refreshing taste of Coca-Cola in Atlanta, Georgia it was May

1861 when the pharmacist concocted a caramel colored syrup in threelegged brass kettle in his

backyard. He first distributed the new product by carrying Coca-Cola in a jug cown enjoys in a glass of

Coca-Cola at the soda fountain. Whether by design or accident, carbonated water was teamed with the

new syrup, producing a drink


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that was proclaimed Delicious and Refreshing.

Dr. Pembertons Partner and bookkeeper, Mr. Frank Robinson, suggested the name and penned as

Coca-Cola in the unique flowing script that is still famous worldwide today. Dr. Pembertons sold 25

gallons of syrup, shipped in bright Red wooden kegs. Red has been a distinctive color associated with

the No.1 soft drink brand ever since. For his efforts, Dr. Pemberton grossed $ 50 and spent $ 73.96 on

advertising, by 1891, Atlanta chemist as a G.Canler had acquired complete ownership of the Coca-Cola

business.

He purchases it from the Dr.Pemberton family for $ 2300. With in 4 year his merchandising flair helped

to expand the consumption of Coca-Cola to over $25 million. Robert W. woodruff become the president

of the Coca-Cola company in 1923 and his more than six decades of leadership took the business of

commercial success making Coca-Cola an institution the world over. Coca- Cola begins as a never

tonic, but candy merchant Joseph A. Biedenharn of Mississippi was looking for awry to serve

refreshing beverages. He responded to this demand began offering bottle Coca-Cola using syrup

shipped from Atlanta, during a hot summer in 1894.

HISTORYININDIA

The coca-cola company reintroduced coca-cola in India on October 23, 1993, after an absence of 16

years. The coca-cola company received approval from the government in July 1996 to set up a holding

company to invest US $ 700 million in downstream operation of beverages In July 1997 the holding

company was permitted by the government to operationally its bottling subsidiaries. The bottling

subsidiary currently owns and operates twenty-six

bottling plants and sixty distribution centers across India. In addition, it uses 20 contract packers to

augment its production capacity and cater to the increasing demand for its wide portfolio of beverage.

PROMISEBYCOCA-COLA

The coca-cola companyexiststo benefitsandrefresheveryoneittouches. The basic proposition of

our business is simple, solid and timeless. when we bring refreshment , value , joy and fun to our

stakeholders then we successfully nurture and protect our brand , particularly coca-cola that is the key

to fulfilling our ultimate obligation to provide consistently attractive to the owner so four business.

More than a billion times every day , thirsty people around the world reach for coca-cola products for

refreshment. They deserve the highest Quality every time, our promise to deliver that quality is the

most important promise we make and it involves a world-wide , yet distinctively local , network of

bottling partner , supplier , distributor and retailers whose success is paramount to our own. Our

investment in local communities in over 200 countries totals billions of dollars in jobs, facilities ,

marketing, the purchase of local good and services, and local business partnership. Always and

everywhere , we pursue continuous innovation in the products we offer the processes we use to make

them, the package we develop and the way we bring them to market .


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CompetitorofCoke

PEPSICO

PepsiCo is one the largest companies in the U.S. It figures amongst the largest 15 companies

worldwide according to the number of employees hired. Its has a U.S. Fortune rank of 50.The

company profits for 1997 were $2.14 billion on revenues of $20.92 billion and Pepsi is bottled

in nearly 190 countries.

PepsiCo is a world leader in the food chain business. It consists of many companies amongst

which the prominent once are Pepsi-Cola, Frito-Lay and Pepsi Food International. The group is

presently into two of the most profitable and profitable and growing industries namely,

beverages and snack foods. It has scores of big brands available in nearly 150 countries across

the globe. The group has established for itself once of the strongest brands in various segments

of its operations.


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The beverages segment primarily markets its Pepsi, Diet Pepsi, Mountain Dew and other

brands worldwide and 7-UP outside the U.S. markets. These are positioned in close

competition with Coca-Cola Inc. of USA. A point which is worth a mention is that Coca-Cola

gets 80% of its profits for International operations while the same figure for PepsiCo stands at

6%. The segment is also in the bottling plants and distribution facilities and also

distributes the ready to drink tea products of Lipton in North America. In a joint venture with

orient spray juice products PepsiCo also manufactures and distributes fruit juices.

The snack food division manufactures and distributes and markets chips and other snacks

worldwide. The international operations of this segment extends to the markets of Mexico, the

UK and Canada. Frito-Lay represents this segment of PepsiCo. The restaurant segment earlier

primarily consists of the operations of the worldwide Pizza Hut, Taco Bell and KFC chains.

PFS. Pepsi Cos restaurant distribution operation, supplies company owned and franchise

restaurants in the U.S. The company ventured into restaurant business with Taco Bell, KFC,

Pizza Hut ended last year when they were spinned off from the company. A packaged goods

company comprised of Pepsi-Cola Company and Frito-Lay will continue to bear the PepsiCo

name. The move should enhance both corporations ability to prosper with their own fully

dedicated structure and management team.


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OBJECTIVE

The need of the hour in the dynamic market is to have a clear idea ad to where the

trends are moving and hence the company can align the other channels and areas

with these trends in order to maximise its gains. To aid the company in this

analysis a sales forecasting model for the Delhi NCR region is to be determined

which has the qualitative as well as quantitative insights to the research.

To perform this analysis, the historical data of the past five years i.e. 2005-2010

has to be studied and based on that the quantitative projection has to be made b y

choosing the apt method and tools for forecasting.

Hence forth the various qualitative variables have to be recognised in the market

and studied in detail and their effect needs to be determined and converted into

numerals to ensure better picture of the forecast. The various variables may

include packaging, consumer preference, increased on the move advantage and

purchasing power.

Combination of the above will lead to a per brand, per pack forecast for the

different products for the company.


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Forecasting and Analysis

Since different products show different trends regression method used for various products are different.

Lets take the example for the Coca Cola 600ml PET bottle. The historical data provided for the total

sales for this particular brand and pack is provided below:

Brand/Pack 2005 2006 2007 2008 2009 2010

Coca-Cola 600 ml 347140 409578 584009 744183 838637 1140257

When we run the regression analysis with the linear trend line, the following curve is derives

Sales ofCoca Cola PETBottle

To derive at a forecast we run a linear regression on the past sales data for the year 2005-2010 to give

us the following figures:

Brand/Pack 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Coca-Cola 60 0 ml PET 347140 409578 584009 744183 838637 1140257 1218594 1403371 1570342 1742897 1918649

% increase 18 43 27 13 36 7 15 12 11 10

2005 2006 2007 2008 2009 20100

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

2000000

1 2 3 4 5 6 7 8 9 10 11

Brand/Pack

Coca-Cola600

lPET

Linear (Coca-Cola600

lPET)


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However this is just a micro perspective to the problem, hence a qualitative analysis to the problem was

made. It was seen that the major variables that affected the market were the following:

1. Consumer Preference2. Population3. Trade and availability4. Packaging5. Purchasing PowerHence a study of various reports and data was done to analyse the affect of these variables in the

past sales performance to derive at a matrix which provides a percentage evaluation for the increase

to change the quantitative analysis if needed. Also assumptions were made from individual industry& market trends and various studies like census data to arrive at the final matrix.

200520062007 2008 200920102011 201220132014 20150

500000

1000000

1500000

2000000

2500000

1 2 3 4 5 6 7 8 9 10 11

Brand/Pack

Coca-Cola600 lPET


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Variables

Consumer Preference can be explained from the market share analysis. The results show that Coca

Cola lost market share as compared to last year however showed still an increase at an increasing

rate as compared to last year. This means that even though the popularity of the cola flavour isfalling still the other variables are contributing to the increase in it sales.

Population as studied from the census data Delhi is increasing by a rate of 17% while at least the

majority of the population are the cola consumers i.e. 16- 40 years.

Trade centres and markets are increasing with the growing of the territories and exploring new

markets in the region

Packaging is the most important variable with 500ml and 600ml being the most popular among the

consumers giving them a more handy and portable opportunity.

Purchasing Power being the key ingredient has shown that there is an increase in the consumption

of beverages with the increase in the purchasing power of the consumer

Hence according to the above variables following assumptions in increase in sales were made

Variables Population Consumer preferenc PPP Trade PackagingTotal

Percentage Increase in Sales 10 -5 4 5 10 24

However the change that we see from the quantitative analysis is different so the new matrix for the

percentage can be made by taking their averages to produce the final forecast.

Sales Quanitative Qualitaitive Average New Forecast

2011 7 24 15.5 1316256.473

2012 15 24 19.5 1517631.698

2013 12 24 18 1724006.164

2014 11 24 17.5 1935945.717

2015 10 24 17 2152552.388


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Findings

The above has been done for all the brands and packs to produce the following forecast.


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Brand/Pack 2011 2012 2013 2014 2015

Coca-Cola 200 ml RGB 29145 31502 32072 31680 31122

Coca-Cola 300 ml RGB 1177426 1173003 1143132 1065194 946975

Coca-Cola 330 ml CAN 198220 229897 267021 304511 344535

Coca-Cola 350 ml PET 95964 112261 136779 164938 193593

Coca-Cola 500 ml PET 44097 53043 60789 68393 76723

Coca-Cola 600 ml PET 1316256 1517632 1724006 1935946 2152552

Coca-Cola 1.25 ltr PET 274455 317741 385748 465075 547136

Coca-Cola 1.5 ltr PET 11002 16475 19935 20816 23355

Coca-Cola 2.0 ltr PET 1069994 1215345 1337473 1442153 1531843

Coca-Cola 18 ltr POM 55773 57366 60571 63266 65111

Diet Coke 330 ml CAN 129151 139076 150354 158369 164005

Diet Coke 500 ml PET 129691 149666 167769 186942 205873

Sprite 200 ml RGB 17351 14073 13821 12843 12146

Sprite 300 ml RGB 463708 507145 547820 587076 616877

Sprite 330 ml CAN 60652 71693 83306 94222 106404

Sprite 350 ml PET 22104 26617 32574 38914 45327

Sprite 500 ml PET 12642 15766 18879 21899 25001Sprite 600 ml PET 448023 534862 625052 713960 803109

Sprite 1.25 ltr PET 63015 74298 90808 109591 128818

Sprite 1.5 ltr PET 3072 3279 3325 3267 3565

Sprite 2.0 ltr PET 360083 422418 481352 540611 593820

Sprite 18 ltr POM 6888 5749 5784 5268 4364

Fanta 200 ml RGB 19250 18617 18799 18471 18447

Fanta 300 ml RGB 409441 418644 416905 388352 340502

Fanta 330 ml CAN 36681 43950 51219 57888 65491

Fanta 350 ml PET 17488 28761 40856 51620 57893

Fanta 500 ml PET 12654 16149 18247 19767 21919

Fanta 600 ml PET 460783 556995 648239 731353 812354Fanta 1.25 ltr PET 92266 109098 133548 161332 190283

Fanta 1.5 ltr PET 5170 7323 8547 8880 9938

Fanta 2.0 ltr PET 21102 36205 46722 53260 57775

Fanta 18 ltr POM 7247 6486 6086 5327 4273

Limca 200 ml RGB 70678 69425 66786 65731 67237

Limca 300 ml RGB 1598009 1632013 1644464 1609394 1537515

Limca 350 ml PET 31373 37956 47238 57916 67958

Limca 500 ml PET 23323 26491 25086 25712 23934

Limca 600 ml PET 1347240 1623078 1882210 2134894 2372607

Limca 1.25 ltr PET 324281 384974 474634 578975 685341

Limca 1.5 ltr PET 6897 7423 8000 8560 9716

Limca 2.0 ltr PET 1192572 1417451 1597493 1757909 1890204

Limca 9 ltr POM 3460 4157 4549 4745 4882

Thums Up 200 ml RGB 41551 40019 38524 37693 38166

Thums Up 300 ml RGB 1128073 1295720 1466709 1623441 1759705

Thums Up 330 ml CAN 32770 39253 48154 57917 67477

Thums Up 350 ml PET 29722 35441 43482 52475 61613

Thums Up 500 ml PET 13232 15813 16744 18884 20528

Thums Up 600 ml PET 710355 861097 1033901 1215636 1394617

Thums Up 1.25 ltr PET 147259 173133 213178 260869 308427

Thums Up 2.0 ltr PET 472955 580048 697772 817001 929180

Thums Up 18 ltr POM 412 486 488 533 543

Kinley Soda 300 ml RGB 133079 125482 107368 84814 53629


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Ki l

y Soda 600 l

E

119877 156582 199123 241885 276566

S

h

o

i

Wat

250

l NRGB 52630 64799 78054 90720 101666

S

h Soda 250 l NRGB 4354 5433 6775 8183 9491

S

h Bitt

L

o 250 l NRGB 0 0 0 0 0

S

h Gi g

Al

250 l NRGB 1731 2447 3134 3641 4138

Maaza 200 l

t a 462602 565880 684853 811166 941680

Maaza 200

l RGB 0 0 0 0 0

Maaza 250

l RGB 973217 1033369 1075938 1088510 1073738

Maaza 250

l

E

11808 172804 1363040 6077693 16363609

Maaza 600

l

E

427004 523370 622495 729373 824866

Maaza 1.2 lt

E

223370 249080 271365 300426 317451

MM

O 250

l

E

3314 21857 84589 207503 351065

MM

O 400 l

E

156497 196015 226079 257337 292771

MM

O 1 lt

E

20413 27867 25734 26496 29366

MMNF 200

l

t

a 292 357 451 562 674

MMNF 400 l

E

203476 243663 304373 377548 451456

MMNF 1 lt

E

8924 10575 13143 16262 19420

Ki l

y Wat

500 l

E

762814 912685 1089618 1285833 1467237

Ki l

y Wat

1 lt

E

12b 2774329 3253526 3749708 4294100 4743145

Ki l

y Wat

2 lt

E

16977 16443 19559 23900 27703

Ki l

y Wat

20 lt

JAR 1736157 2003165 2222447 2429968 2627460


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Conclusion.

Pack wise 500 ml and 600ml PET bottles show the maximum increase

in the forecast because the convenience and the handiness it offers to

consumers. Even though the quantitative trend shows a major downfallin the Returnable Glass Bottles however the quantitative analysis

shows that because of the conventional trade and approach the

downfall will not be so steep however will be gradual. All the POM are

going to increase at an increasing rates.

The Flavour that shows maximum scope are the Minute Maid Pulpy

Orange and Nimbu Fresh giving the consumer an alternative to soda asthere are major health conscious concerns seen in the consumer

preference. Also among the sparkling flavours Limca and Fanta show

more increase than other brands like Coca Cola & Thumbs Up showing

that the consumer is moving away from the conventional Cola Flavour.

Also the water and soda products like Kinley and Schweppes show a

major increase as the industry and market demands show a steep

increase. Also the demographic of Delhi being moving and working

give a great advantage to these products.


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Annexurre

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Documents

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