ON

(IN KANPUR)

OF

FOR

HINDUSTAN COCA-COLA BEVERAGES PVT.LTD., PANKI INDUSTRIAL AREA, DADA NAGAR KANPUR.

SUBMITTED IN SUMMER TRAINING OF M.B.A. PROGRAMME OF LOVELY PROFESSIONAL UNIVERSITY

PHAGWARA, PUNJAB.

-: UNDER GUIDANCE OF :-

MR. MANISH PUNDEER

MOHD. FAISAL

SUBMITTED BY:

SHYAMAL MISHRAM.B.A. III SEMESTER

2009-2011

LOVELY PROFESSIONAL UNIVERSITY,

JALANDHAR

PUNJAB

1

ACKNOWLEDGEMENT

I would like to express my heartiest gratitude to Mr. Deepak Rewari

(General Manager) Mr. Manish Pundeer (Area Capability &

Development Manager) Hindustan Coca Cola Beverages Private Limited.

Panki Industrial Area, Kanpur for giving opportunity to associate myself

to the world’s largest soft drink company and to carry out my project

titled “Right Execution Daily & Horizontal Expansion”.

I am sincerely thankful to Mr. Mohd. Faisal (SALES

TRAINER) under whose guidance I have successfully completed this

project and the time spend with him has been a great learning experience.

Due to his constant encouragement, warm response and guidance for

filling every gap with valuable ideas that has made this project successful.

I would also give special thanks to all the owner of the out lets for giving

me the precious time to discuss all their problems. I would also like to give

my sincere thanks to all the staff and the members of Hindustan Coca-

Cola Beverages Private Limited.

(Manish Pundir)SHYAMAL MISHRA

(A.C.D.M.) M.B.A. III SEMESTER2009-2011

2

CERTIFICATE-

This is to certify that Mr. Nitin Mishra has satisfactorily completed the project

work entitled "Consumer Buying Behavior Regarding houseware products" at

Hamilton Houseware private Limited, under the guidance based on the declaration

made by the candidate and my association as guide for carrying out this work, I

recommend this project report for evaluation as a partial requirement of the MBA

Program of lovely professional university, Punjab.

DATE: MR. SANJAY JINDAL

(PROJECT GUIDE)

3

MEANING OF PROJECT

The word “Project” has great specification in the field of management before

starting any work we must have an idea about its basic. The meaning of the

“PROJECT” is as follows: -

“P” – The word ‘p’ signify the phenomenon of planning, which deals

symbolization and proper arrangement of sensex and suggestion on

respectively in accordance with need.

“R” – It stand for associated with word resource with which guides to promote

planning.

“O” – This letter stands overhead expenses on unestimated expenses, which

occur in manufactures designed or layout of project.

“J” – This letter stands for joint efforts i.e. Project work which is undertaking

should be completed with a combined effort.

“E” – This stands for engineering i.e. worker undertaken is to be employing

technical process.

“C” – This stands for the phenomenon of constriction on which is more

essentially and basic form of work.

“T” – This stands for the techniques unless techniques to work is not Known.

CONCLUSION: - In general we came to conclusion. That project is

systematic conclusion discussed proposed particular subject which, include

complete information about required to machine tools, appliances need the

various operation required to be done in well sequences.

4

CHAPTER TITLE PAGE NO.

I INTRODUCTION – PURPOSE 6-55

II REVIEW OG LITERATURE 56-61

III R.E.D. CONCEPT 62-65

IV HORIZONTAL EXPANSION 66-69

V RESEARCH METHODOLOGY 70-72

VI DATA ANALYSIS 73-78

VII CONCLUSION 79

VIII FINDINGS 80

IX SUGGESTIONS 81

X QUESTIONNAIRE 82

XI REFERENCES 83

XII R.E.D. SCORING SHEET 84-85

5

INTRODUCTION

“Coke would rather be long term wiser, than being short term smarter”

Abraham Ninan Director External Affairs, Coca-Cola, India

COCA COLA ENTERPRISES INC.

TYPE : PUBLIC (NYSE:CCE)

FOUNDED : 1926

HEAD QUARTERS : ATLANTA, GEORGIA, U.S.A.

CHIEF EXECUTIVE OFFICER : JOHN BROCK

CHIEF FINANCIAL OFFICER : WILLIAM W.DOUGLAS

INDUSTRY : BEVERAGES

REVENUE : $19.800 BILLION USD

OPERATING INCOME : $1.495 BILLION USD

NET INCOME : $1.143 BILLION USD

EMPLOYEES : 73,000 (APPROX)

6

7

HISTORY OF COCA-COLA

This story begins in Atlanta, Georgia on May 8, 1886, when a pharmacist

called Dr. John Smith Pemberton first mixed Coca-Cola in his back yard. This

formula, which was made from carbonated water, cane sugar syrup, caffeine,

extracts of kola nuts and cola leaves, was brought to the nearby Jacobs’

Pharmacy where it made its Debut as a soft drink the same day, selling for

only 5 cent. His bookkeeper named this drink “Coca-Cola” after the first two

ingredients and the same distinctive script he wrote it in is the same logo they

use

To this day.

In January 1893 Coca-Cola was registered with the U.S. patent office.

Later on in 1915 the Root glass company created the famous contour glass

bottle for Coca-Cola in 1915.

In 1917 Coca-Cola was found to be the world’s most recognized

trademark with a record of 3 million Coke’s sold per day. Unfortunately, John

Pemberton fell ill, and did not live to see his product’s success.

Sadly, in the first year of Coke’s existence, Pemberton and his partner

only made $50. Pemberton sold two third of his business in 1888 to cover his

losses and keep the business afloat.

He died later that year, and Mr. Candler, an Atlanta druggist,

purchased total interest in Coca-Cola for an unbelievable $2,300 in 1891. In

1891,Candler and his brother formed the Coca-Cola Company.

8

EARLY GROWTH

In 1893 Candler registered Coca-Cola as a patented trademark. He also

responded to growing concern over the dangers of cocaine by reducing the

amount of coca in the drink to a trace. However, he kept some coca extract in

Coca-Cola so the name would accurately describe the drink. Candler only had

a patent on the name, and not the drink syrup that is, the drink’s base,

containing all the ingredients minus carbonated water. He figured that keeping

the Coca in his formula would legally allow the company to distinguish its

drink from imitations. Other companies also produced soda drink made with

cola nut extract. In particular, the Pepsi-Cola Company would become Coca-

Cola Company’s major competitor over the next few decades.

Candler also spent more than $11,000 on his first massive advertising

campaign in 1892. The Coca-Cola logo appeared across the country painted as

a mural on walls; displayed on posters and soda such as calendars and

drinking glasses. In addition, Candler was the first person ever to use coupons

to gain customers for a product. He distributed flyers offering free soda

fountain glasses of Coca-Cola to people visiting his drugstore.

In 1894 the Coca-Cola Company opened its first Coke syrup

production plant outside of Atlanta, in Dallas, Texas. That same year a candy

storeowner in Vicksburg, Mississippi, installed bottling machines and

produced the first bottled Coke. It had previously been sold only at soda

fountains. By 1895 the drink was sold in all U.S. states and territories.

In 1899 lawyers Benjamin Thomas and Joseph Whitehead of

Chattanooga, Tennessee, bought the exclusive right to distribute Coke syrup to

bottles throughout most of the country for only on dollars, at the time, Candler

saw little profit in bottling and was more than willing to give up that part of

the business.

In 1915 the Root Glass Company created a couture glass bottle for

Coke, its design based on the curvature of a coca bean. This bottle design

9

became a Coke trademark worldwide. The same year, Candler retired from the

company, passing it on to his children and moving into polities. He was

elected mayor of Atlanta in 1916.

In 1919 the Candler family sold Coca-Cola to businessman Ernest

Woodruff of Columbus, Georgia, for $25 million. Woodruff son, Robert, was

elected company president in 1923. Robert Woodruff was a skilled marketer,

and he put more of the company’s resources into market research than

manufacturing Coke.

WARTIME DEVELOPMENT

During World War II (1939-1945), Woodruff also boosted

Coke’spopuler image in the United States by pledging that his company would

provide Coke to every U.S. soldier. The company did not limit itself, however,

to only doing business that would increase its success in America. In the

period leading up to the war, between 1930 and 1936, it had set up a division

of the company in Germany, and it continued that venture during the war. It

recreated its image as a German company and allowed the Germans to

produce all but two, secret, Coca-Cola ingredients in their own factories.

In 1941 the German company’s president, Max Keith, developed Fanta

orange soda using orange flavoring and all the German-made Coke

ingredients. The Coca-Cola Company’s wartime efforts helped it expend its

global market, often with the economic support of the U.S. government.

By the end of the war in 1945, it had established 64 overseas bottling

plants. The same year the company registered a patent on Coca-Cola’s popular

nickname, COKE.

POSTWAR GROWTH

In 1955 Robert Woodruff retired as the Coca-Cola Company’s

president. Candler and Woodruff are remembered as the two most important

figures in the company’s early growth, both for their contributions to the

company and their considerable fortunes donated to the city of Atlanta. After

10

Woodruff departure, the company began to diversify by producing new

products, acquiring new business, and entering new international markets.

In 1960 the Coca-Cola Company purchased the Minute Maid Corp.

producer of fruit juices and began offering Coke in cans. Between 1960 and

1963 it also launched four new soft drink in the United States: Fanta, an

orange soda; Sprite, a lemon-lime soda; Diet Cola; Diet grapefruit-flavored

soda. In 1964 the company acquired the Duncan foods crop. In 1967, it created

the Coca-Cola foods division by merging its Duncan and Minute Maid

operations.

In the late 1960s, Coca-Cola faced difficulties in some of its foreign

markets. When the company built a bottling plant in Israel at the outset of the

Arab-Israel War, the governments of all Arab League nations banned the

production and sale of Coke. A year later the company withdrew from its

markets in India when that country’s government requested that Coca-Cola

reduces its equity in joint ventures to 40 percent. The company refused to

relinquish so much control over those operations.

In 1977 Coca-Cola began packaging Coke and other drinks in two-liter

plastic bottles. The popularity of these large bottles grew over time, and their

sales earned the company new project, primarily in small specialty and

convenience stores.

In 1982 the company introduced Diet Coke, which soon becomes the

best-selling diet soft drink in the world.

Also in 1982, Coca-Cola purchased the motion-picture company,

Columbia Picture Industries, also know as Tri-star Pictures, for almost $700

million. Two year later, the company sold off its Columbia holdings and other

media acquisitions to Sony Corporation for over $1.5 billion.

By 1984 Pepsi-Cola had gained on Coke’s previous domination of the

U.S. market to the point that the two had almost equal sales. In an attempt to

return market dominance, the company attempted the first-ever reason of the

original Coke recipe. The American public largely rejected New Coke, and so

the company quickly returned to also producing the old recipe under the name

Coca-Cola classic.

11

RECENT DEVELOPMENTS

In 1986 The COCA-Cola Company consolidated all of its no

franchised U.S. bottling operating as Coca-Cola Enterprise, Inc. The new

company began acquiring independent bottling companies, a venture that grew

into the world’s largest bottle of soft drinks by 1988, while Coca-Cola

Enterprise distributes over half of all Coca-Cola products in the United States,

small franchises businesses continue to bottle can and distribute the

company’s drink worldwide.

In 1987 The Coca-Cola Company was fisted in the prestigious Dow

Jones Industrial Averages index of stock market performance. Its stock is

traded on the New York Stock Exchange. Coca –Cola and Pepsi Company

products occupied nine of the top ten spots in the U.S. soft drink market in

themed-1990s.

Worldwide, Coca-Cola ranked first in soft drink sales, and the

company earned almost 80 percent of its profits from international sales.

12

13

SOFT DRINK INDUSTRY IN INDIA

The Indian Soft-Drink Industry is a 3500 crore rupee Industry

comprised of consumer’s throughout the country, and of all ages. The industry

has been comprised of all Indian Soft-Drinks manufactures and the

multinational Coca-Cola up to 1976.

From 1976 to 1989, the industry only comprised of Indian

manufacturers namely, Parle, Campa-Cola and Dukes. Decades of 90’s have

brought changes in Government Policies of liberalization, which has helped

user in two huge American Multinational Pepsi-Cola international and Coca-

Cola.

THE CHRONOLOGY OF SOFT-DRINK SCENARIO

IN INDIA

1977

Refusing to dilute its equity stake, Coca-Cola winds

up it operations in the country.

Thums-Up from Parle and Campa-Cola from Pure

Drinks launched.

1986

An application for a soft drink cum snack food joint

venture by Pepsi. Voltas and Punjab agro is

submitted to the Indian Government.

1988

Final approval for the Pepsi food limited project

granted by the Cabinet committee on economic

affairs of the Rajeev Gandhi Government.

14

Coca-Cola South Asia Holding Incorporation of the

U.S. files an application to manufacture soft drinks

concentrate in Noida (Delhi) free trade zone.

1990

Pepsi Cola and 7 Up launched in limited market in

North Indian.

The Government clears the Pepsi Project again but

with the brand name changed to Lehar Pepsi.

Simultaneously, it also rejects the application of

Coke. Citra hits the market from the Parle Stable.

1991

Britco food files an application before FIPB to set

up a new 50 crore facility in Maharashtra.

Pepsi extends its soft drink reach on national scale.

Products launched in Delhi and Bombay.

Britco foods application cleared by the FIPB, Pepsi

and start initial negotiations for a strategic alliance

but talks break of after a while.

1993

Pepsi launches Teem and Slice to counter Limca

and Maaza respectively from Parle. Pepsi captures

about 30% market share in about two years.

Coke files an application for a 100% owned soft

drinks company with FIPB, Decides to part ways

with Rajan Pillai. The Government clears the Coke

application in record time.

Voltas pulls out of the Pepsi Food Limited joint

venture. Pepsi decides to buyout the Voltas share

15

and raises its equity to 92% Report of Coke Parle

joint gain strength.

Pepsi launched 1 liter bottles in Pepsi-Cola,

Mirinda and Teem flavors. Sweeps off the 100ml

segment over Pure Drinks.

Coca-Cola buys out Parle and major leaders of the

market, Ramesh Chauhan, becomes a part of the

Coke game plan.

Fountain Pepsi launched in the Northern part of

India.

Coca-Cola hits the Indian in 300 ml at the price of

250 ml. Equity 100% for Coca-Cola.

Pepsi jump up in to Mineral Water name Aquafina.

2000

Coca-Cola Indian has registered a growth of 18th

percent in its net sale during the first quarter of the

current fiscal year.

Hrithik the burning sensation of Bollywood is hired

to advertise Coke is very effective.

2001

Coca-Cola upgraded from 1.5 ltr. To 2 ltr.

Coke hired Ashwaria, Amir Khan and Hrithik for

effective advertising.

16

17

COCA-COLA IN INDIA

The Coca-Cola Company entered India in the early 1950s. It set up

four bottling plants at Bombay, Calcutta, Kanpur and Delhi.

In 1950 as there were negligible companies in Indian market therefore

Coca-Cola did not face much competition and they were accepted in Indian

market more easily. By the end of 1977 Coca-Cola had captured more than

45% of market share in India. Then Coca-Cola left India following public

disputes over share holding structure and import permit. As per FERA

REGULATION the company was required to India close operation by May 5,

1978 yet strongly enough the company’s operation come to end in July 1977.

In October 1993, Coca-Cola returned to India after 16 years of absence

with the slogan “Old waves have come to India again” first launched in

HATHRAS near AGRA HOME of the famous TAJ MAHAL.

At this time Parle was the leader in soft drink market and had more

than 60% of the total market share in soft drink Coca-Cola joined hand with

Parle and strategic alliance with Parle export give the company instant

ownership of the nation top soft drinks brands Thums-Up, Limca, Citra, Gold

Spot and Maaza access to Parle’s extensive 62 plant bottling network and a

base for the rapid introduction of the company’s international brand by

striking a $40 million deal with Parle Coke almost a clear sweep and made it

goal as “To become an all occasion drink not a special treat beverage”.

VISION OF COCA-COLA IN INDIA

Provide exceptional strategic leadership in the Coca-Cola India System

resulting in consumer and customer preference and loyalty through Coca-

Cola’s commitment to them, and in a highly profitable Coca-Cola corporate

branded beverage system.

MISSION OF THE COCA-COLA IN INDIA

18

Create consumer products, services and communications customer’s

service and bottling system strategy processes and tools in order to create

competitive advantage and deliver superior value to:

Consumers as a superior beverage experience.

Consumers as an opportunity to grow profits through the use of

finished drinks.

Bottlers as an opportunity to make reasonable to grow profits

and volume.

TCCC as trademark enhancement and positive economic value

added.

Suppliers as an opportunity to make reasonable profits when

creating real value added in an environment of system wide

teamwork, flexible business system and continuous

improvement.

CCI associates as superior career opportunity.

Indian society in the form of a contribution to economic and

social development.

PRODUCT PROFILE OF COCA-COLA

There are nine brands of coca-cola in India and they are differ in taste,

flavor and also in their colours.

1. COKE

Coke is considered to be a cola drink. It is generally preferred by all

sections of consumer. This is a case cow brand for the company in terms of

sales revenue.

19

2. THUMS-UP

Thums-up is also considered to be a cola drink. It is hard in

comparison to coke. It is preferred by all section of consumers but especially

to teen-agers. It is a big source of company to cash its publicity.

3. LIMCA

Limca is considered to be lemony in taste, and comes under the

category of cloudy lemon because of its colour, which is similar to that of

clouds. It has to yield good sales revenue. It is generally preferred by Children

& Women.

4. FANTA

FANTA ORNAGE, It is orange flavor & preferred by Children &

Women.

5. MAAZA

MAAZA MANGO, in maaza cold drink no gas only based on juice. It

is a non-aerated soft drink. It is preferred mostly Children & Women.

6. KINLEY SODA

This is a soda drink. It has no colour and no flavor. It is generally used

with alcohol and used by adults.

7. SPRITE

Sprite is a good product at cola and contains at lemon flavor.

8. KINLEY WATER

20

Kinley water is a fresh and mineral water and market competitor of

Bisleri and Aquafina.

9. MINUTE MAID

In Minute maid pupply orange cold drink no gas only based on orange

juice. It is a non-aerated soft drink and market competitor of Tropicana

Twister.

21

SWOT ANALYSIS

STRENGTHS

1. Improved quality control.

2. Latest technology.

3. Heavy investment in both infrastructure and sales promotion

campaigns.

4. Modified and attractive packaging.

5. Strong advertising network.

WEAKNESS

1. Entire infrastructure needs a face-lift.

2. Unskilled labour.

3. Tight case policy.

4. Fear of retrenchment among the workers.

OPPORTUNITIES

1. Wide market.

2. Good rural market.

3. Direct distribution.

THREATS

1. Stiff competition.

2. Illegal distribution done by some distributors.

3. Changing of consumer preference.

22

CONSUMER CHOICE AT A GLANCE

Coca-Cola Mainly preferred by the Youngster & Kids.

Thums-Up Youngster.

Limca Common Drink.

Fanta Basically Preferred by Ladies and Kids.

Maaza Also Ladies and Kids.

Sprite Not clearly defines.

Kinley Soda Mostly those who consume liquor.

23

24

INGREDIENT DELIVERY

Sweetener

Team of professionals, work on selecting, auditing, sampling, testing,

approving and then authorizing the sugar suppliers and the list of such

authorized suppliers with approved sugar lots and along with the certificate of

analysis are sent across to all the bottling unit for procurement.

Secret Formula

Created in special concentrate plants, it's delivered, held and used under strict

controls to maintain its integrity and security. Each unit of concentrate is

especially identifiable to allow the "history" of each component to be

researched at any stage of production, storage or use.

CO2 Formula

when delivered to the plant, carbon dioxide, or CO2, comes in cylinders for

easy delivery and storage. But what is it? In essence, it's a colorless and

odorless gas that provides the "fizz" for our beverages. But it's also a by-

product of our breathing and used by plants and trees to produce oxygen.

Water

since water is a key component to all our beverages, its quality is critical. And,

since public water quality varies around the world, each plant further treats the

water it uses. This means that before water is added to any of our beverages;

it's rigorously filtered and cleansed. We then continuously sample the water to

ensure it meet our standards.

Materials

25

Ingredients are not the only things delivered to the plant. Other materials such

as bottles, cans, labels and packaging are also delivered. Our plants in India

use refillable bottles, CANS, PET etc. in the Production Process, when bottles

and cans are delivered to the plant; they are carefully inspected to ensure that

they meet our exacting standards. Once these have passed initial inspection.

WASHING AND RINSING

To ensure quality, each bottle is washed, sanitized and rinsed before being

filled. While this sounds simple, the actual steps can differ by bottling plant. In

India, our plants use refillable glass, cans or PET bottles. To ensure they meet

our cleanliness standard, bottles are first hit with prerinse jets which remove

any dirt or debris. They are then soaked in a high-temperature deep cleaning

solution that removes any remaining dirt and sanitizes them. The bottles then

move to the "hydrowash" where they are washed again with a deep cleaning

pressure-spray. They move on to be washed and/or rinsed.

MIXING AND BLENDING  

H2O and Sugar

Mixing and blending begin with the steps of mixing pure water with refined

sugar, which creates simple syrup. The syrup is then measured for the correct

amount of sugar.

Secret Formula

Our secret formula is... still secret! That's right; the secret formula remains a

26

mystery to the millions of people in nearly 200 countries that enjoys our

refreshing beverages everyday. Even though we can't tell you the secret, you

can be sure that "LIFE TASTES GOOD" with Coca-Cola.

H20 and Syrup

With the syrup nearing its final state, we mix it with pure water, creating the

finished uncarbonated beverage. However, the water and syrup must be mixed

in right ratio. This is done by the beverage proportioning equipment. It

accurately measures the correct ratio for each and sends this mixture to the

carbonator.

CO2 Adding

Adding CO2 or carbon dioxide gas is the final touch that carbonates the

beverages. Carbon dioxide not only gives our beverages their effervescent

zest, but it also adds to the distinctive and familiar taste everyone has come to

expect from our beverages.

FILLING

Once all the ingredients have been mixed and blended and the bottles have

been cleaned and sanitized, we're ready to start filling. This is a surprisingly

complex process requiring precision at each step. To begin with, bottles must

be carefully timed as they move to the filler - synchronization is key. Once at

the filler, bottles are either held securely in place by flexible grippers or

precisely placed under filling valves by centering devices. Before the bottles

can be filled, the inside of the bottles must be pressurized. This allows for the

force of gravity itself to draw the beverage into the bottle - a process that

ensures the smooth flow of liquid, with little to no foaming.

CAPPING

27

Once filled, bottles are then capped. We use different caps for different bottles

- glass bottles are usually topped with a metal crown while "PET BOTTLES"

are topped with a plastic screw-top. Each cap type then moves through

different parts of the machine, which ensures each cap stays scratch free and is

in the right position to be precisely placed on the bottle. As quality and

freshness are key, we use a "no closure" detector during the capping process

and a "go-no-go gauge" or "torque meter" after the bottles has been capped.

The "no-closure"

detector checks if a screw top or crowns has been placed on bottle. The

process actually stops if the detector doesn't find a closure. The "go-no-go

gauge" checks for the proper crown crimp and the "torque meter" checks to

make sure the screw-top is good and tight. If the bottle cap isn't just right, the

beverages can become flat or be affected in other ways. If this happens, the

bottle is discarded.

LABELING

Once the bottles have been filled and capped, they move on to be labeled. A

special machine dispenses labels from large rollers, cuts them and place on the

bottles. For special labels such as commemorative bottles for football

championships, the labels are sent to the bottling plants for approval, and then

used for packaging. Depending on the occasion, some of these special bottles

will go only to the specific locations. For example, a national football

championship bottle will be sent only to the hometown or state of the

championship team.

CODING

The bottle is now ready to be coded. Each one of our beverages is marked with

28

a special code that identifies specific information about it. The codes simply

identify the date the beverages was bottled or canned. These codes identify the

date, time, batch no. And the MRP. Product coding allows us to ensure that u

receive our beverages at their flavorful best

INSPECTION

We inspect bottles at many points during the process. With refillable bottles, it

happens they are first brought into the plant. They are also inspected after they

are washed and again after they are filled. Inspectors look for external bottle

imperfections and make sure each bottle has the right amount of beverages.

Even after filling, each plant samples bottles for analysis in its lab to ensure

quality is up to standards.

PACKAGING

Once our filled beverages have passed final inspection, they are ready to be

packaged for delivery. Generally, packing can refer to everything from the

unique "BOTTLE" and "CAN" designs, to label designs, to cardboard boxes

and containers, to plastic rings. Because the needs and tastes of our consumers

are so diverse, the packaging varies depending on where the beverages are

being sent.

WAREHOUSING & DELIVERY

In order to make sure the freshest beverages possible get to you, each

warehouse must efficiently manage the thousands of beverages cases produced

each day. Beverage organization is key, though it's the bottle and can coding

that allow for the necessary precision. From the warehouse, we load beverages

onto our distinctive trucks. Night and day, our trucks are delivering our

refreshing beverages to stores, soda fountains, and vending machines near

you.

29

Pesticide use

In 2003, the Centre for Science and Environment (CSE), a non-governmental

organisations in New Delhi, said aerated waters produced by soft drinks

manufacturers in India, including multinational giants Pepsico and Coca-Cola,

contained toxins including lindane, DDT, malathion and chlorpyrifos—

pesticides that can contribute to cancer and a breakdown of the immune

system. Tested products included Coke, Pepsi, and several other soft drinks

(7Up, Mirinda, Fanta, Thums Up, Limca, Sprite), many produced by The

Coca-Cola Company. CSE found that the Indian produced Pepsi's soft drink

products had 36 times the level of pesticide residues permitted under European

Union regulations; Coca Cola's 30 times. CSE said it had tested the same

products in the US and found no such residues. Coca-Cola and PepsiCo

angrily denied allegations that their products manufactured in India contained

toxin levels far above the norms permitted in the developed world. David Cox,

Coke's Hong Kong-based communications director for Asia, accused Sunita

Narain, CSE's director, of

"brandjacking" — using Coke's brand name to draw attention to her campaign

against pesticides. Narain defended CSE's actions by describing them as a

natural follow-up to a previous study it did on bottled water.

In 2004, an Indian parliamentary committee backed up CSE's findings,

and a government-appointed committee was tasked with developing the

world's first pesticide standards for soft drinks. Coke and PepsiCo oppose the

move, arguing that lab tests aren't reliable enough to detect minute traces of

pesticides in complex drinks like soda.

30

The Coca-Cola Company has responded that its plants filter water to

remove potential contaminants and that its products are tested for pesticides

and must meet minimum health standards before they are distributed.

Coca-Cola had registered a 15 percent drop in sales after the pesticide

allegations were made in 2003.

As of 2005, Coke and Pepsi together hold 95% market share of soft-drink

sales in India.

In 2006, the Indian state of Kerala banned the sale and production of

Coca-Cola, along with other soft drinks, due to concerns of high levels of

pesticide residue On Friday, September 22, 2006, the High Court in Kerala

overturned the Kerala ban ruling that only the federal government can ban

food products.

Water use

Environmental degradation in the form of depletion of the local ground

water table due to the utilization of natural water resources by the company

poses a serious threat to many communities.

In March 2004, local officials in Kerala shut down a $16 million Coke

bottling plant blamed for a drastic decline in both quantity and quality of water

available to local farmers and villagers.

In April 2005, Kerala's highest court rejected water use claims, noting

that wells there continued to dry up last summer, months after the local Coke

plant stopped operating. Further, a scientific study requested by the court

found that while the plant had "aggravated the water scarcity situation," the

"most significant factor" was a lack of rainfall . Critics respond that Coke

shouldn't be locating bottling plants in drought-stricken areas.

The company has been trying to regain the plant's license, fighting a

case that has gone all the way to India's Supreme Court.

Meanwhile, near the holy city of Varanasi in northeastern India, a local

water official blames a Coke plant — which has been the scene of many

protests by NGOs and local residents — for polluting groundwater by

31

releasing wastewater into surrounding land. A Coke official confirms there

had been a drainage problem with treated wastewater several years ago but

says the company built a long pipeline to correct it.

Indian environmental activists Vandana Shiva has stated that it takes

nine litres of clean water to manufacture a litre of Coke though Coca-Cola

says it is only an average of 3.12 litres.

P ackaging

Packaging used in Coca-Cola's products has a significant environmental

impact but the company strongly opposes attempts to introduce mechanisms

such as container deposit legislation.

Criticisms in context of India's past

These controversies are a reminder of "India's sometimes acrimonious

relationship with huge multinational companies." Indeed, some argue that

Coke and Pepsi have "been major targets in part because they are well-known

foreign companies that draw plenty of attention."

Coca-Cola was India's leading soft drink until 1977 when it left India

after a new government ordered the company to turn over its secret formula

for Coca-Cola and dilute its stake in its Indian unit as required by the Foreign

Exchange Regulation Act (FERA). In 1993, the company (along with

PepsiCo) returned in pursuance of India's Liberalization policy.

32

DIFFERENT PLAYERS IN THE SOFT DRINKS MARKET

PEPSI

Caleb Brandhum, a North Caroline Pharmacist, structure Pepsi Cola in

the 1890’s as cure of dyspepsia (indigestion). In 1902, Bradhum applied for a

trade mark, issued ninety seven share of stock and began selling Pepsi syrup in

earnest. In his first year of business he spend $1900 on advertising a huge sum

that he sold only 8000 gallons of syrup. In 1905 Bradhum built Pepsi’s

bottling plant. By 1907 he was selling 10,000 gallons a year, two years later,

he hired a New York advertising agency. After passing through many troubles

for some period now Pepsi is a market leader in international arence and is

33

available in 187 Nations throughout the world in 18 flavors having its Head

Office in New York, United State. Pepsi has 13 bottlers with 26 plants in

India. Through this compared with 60 plants of Coke is quite less, yet the

market share of Pepsi has increased quite significantly.

PEPSI IN INDIA

This $3040 billon, New York (U.S.) based Pepsi Company, had to start

from scratch after entering the country in 1989. Deep blue Pepsi, is a broad

based food and beverage company, deriving more than 60% of it’s sales and

operating profits from it’s snack foods and restaurant business.

Pepsi started its commercial production in 1990 with plants, one at

Channo (Sangrur) and other at Jahura (Distt. Hoshiarpur). Pepsi drink, which

was introduced six year back, has now become the household name thought

the country.

The Marketing efforts of Pepsi in the first three year were so

successful, that Pepsi had taken major market share of Parle and Parle has to

face hard times. Pepsi-Cola has been positioned as a drink for the young. It’s

popular slogan “YEHI HAI RIGHT CHOICE BABY” go to show that appeal

is significantly for the younger generation in a popular, much aired

commercial, Bollywood star Sachin Tendulkar. Began to cdroon in the tune

only after he’d guzzled, the right cola, made the smart choice (A-Ha!).

Behind the hype in an effort invisible to consumer Pepsi pumped in Rs.

300 crore to add muscle to its infrastructure in bottling and distribution.

At present Pepsi is at war with Coke at National level.

CADBURY SCHWEPPES

Cadbury Schweppes are joined force of Cadbury found in 1824 of

U.K. and Schweppes of Ireland founded in 1783. Cadbury Schweppes is

unified bussing which manages the relations his with over 240 franchised

34

bottling operation on Zambia and Zimbabwe. Cadbury Schweppes has fottlery

and partnership operations in 14 countries around the world.

CADBURY SCHWEPPES IN INDIA

May 1995 one more soft drink Cadbury Schweppes entered the Indian

soft drink market and now the competition in this industry is more due to rise

in the number of competition and also due to large product range that they all

are offering to the market. Cadbury Schweppes, just about two year old in

India udebtufues with the guerilla. Number three in the aerated soft drink

market after Pepsi and Coca-Cola Company; it is resorting to some very smart

footwork to gain its share of silence.

The company wants to be number one in the non-cola aerated soft

drink market, to which end it has unabashed a series of tactics. “WE DON’T

DIRECTLY HIT COMPETITION BUT CHOP AT AWAY AT THE

ENGED”. Says Ashok Jain C.E.O Cadbury Schweppes India. The idea is to

convert the narrow scrip to a niche and build it to a position of reverence with

a consumer.

John S. Perberton, who in 1886 first construed coke syrup in his

laboratory, knows little that he had made a formula that would sell one day to

a thirsty market of 13.1 billion dollar coke drinkers.

Perberton was morphine addict who was trying to create marketable

patent medicine. When his experiments led to the new scared Coke formula.

He had only modest success selling Coke in Atlanta and he sold his formula

and right for a pittance. He died in 1888. Atlanta druggist as a Candler who

soon gained control of Coca-Cola is in many way the true father of coke. He

transformed the small time operations in to a nation wide soda fountain

sensation.

Early on, Coke had a distinct cocaine kick, even through corporate,

Coke has long dispute. This piece of America folk care, saying the coke leaf,

35

was they with the syrup and training needed to produce distributes and sell the

product and above all the most valuable assent, the trademark.

Also coca-cola’s main revenue stream is from the sale of concentrate

of its bottles. In India, the sole rights the manufacturer concentrate rests with

its 100% subsidiary coca-cola beverages near Pune.

A unit of concentrate makes 400 cases (of 24 bottles each) and

according to an estimate generates income of Rs. 20 per case for the parent

company.

Bottlers maintain their production line to coke standard of 600 bottles

per minute.

Today the two multinational operates in two ways.

COBO-Company owned bottling operation, and

FOBO-Franchisee owned bottling operation.

WHERE THE MONEY GOES

Low per capital consumption of soft drink in India may be linked to

the inflated prices of such drinks. But surprisingly it leaves a very low margin

for bottler’s decocanised. Candler had later testified on court that coke

contained a very small proportion of drug without the coke would never have

been as popular as it was its early days. The cocaine was eliminated in 1903,

as panicked reaction to the raising criticism, inflamed by Newspaper

allegations that black coke drinkers were attacking whites.

In 1917, Candler gave almost all of his coke, stock to his children, who

sold out two years later to a syndicate headed by, Atlanta Banker Ernest

36

Woodruff, for $25 million. Woodruff eventually took over and ruled the

company to its present glory. Woodruff died in 1985.

COKE IN INDIA

Despite the formidable track of its parent (Coca-Cola Company the

$18 billion gaint, based in Atlanta “U.S.”), Coca-Cola India’s record in

Rs.1800 crore soft drinks market is prominent. Coca-Cola entered Indian

market after 16 years from Hathras December 1993 Coca-Cola became the

undisputed leader of the Indian soft drink industry, because if their acquiring

rights of Ramesh Chauhan’s aerated Parle drinks.

With one stroke of the pen, and a bill of 140 crore coca-cola picked by

five brands- Thums Up, Limca, Gold Spot, Citra and Maaza with a combined

market share of 69 percent with Thums Up alone accounting for 56% of the

then 650 crore cola segment.

Coca-Cola world’s largest selling soft drink and which sells nearly half

the soft drink of world market its reentry with planned strategy.

MODUS OPERANDI

The multinational soft drink companies carry their business by

licensing bottlers around the country or more technically franchising the

bottlers and supplying also. With retail prices ranging to Rs.9-10 per bottle

(300ml) for consumer and Rs.196 per crate (24 bottles) for retailers. A bottler

must pay as such as 34% of the price per case as excise duty, sales and

turnover tax.

A further 10% goes into expenditure on local advertising and sales

promotion. Distribution and transportation cost takes care of another 10% Raw

material cost, Concentrate, Sugar, Citra, Acid, Bottle caps etc. eat up another

23% production cost, in terms of fuel, power, maintenance and labour add up

to 14%.

37

Thus leaving a bottler with a margin of 9%, again 4% of this would go

into warheads and interest charges, trimming down the margin to a simply 4-5

% a bottling operation, thus is viable only large volume.

(This is also one of the reasons of FOBO being converted in COBO).

The consumer, obviously, shoulders most of the burden, bottle cost are

also critical component of soft drink business.

Coke is positioning all of its beverages as all seasons’ beverages rather

than only summer drinks; this will greatly help to increase consumption.

In summer coca-cola was coping with a change, C.E.O-Alex Born has

replaced David Short.

Coke has made India its home; coke is experimenting with mobile

dispensing units at beaches and stadiums, going out towards consumers. “Our

goal is to have available within arm’s reach of desire”. Nicholas once said

(Retd. C.E.O).

While Pepsi wants people to come to them, Coke plans to after

consumer.

Coke’s objective in short run shall be converted Pepsi drinks, rather

than Thums Up drinkers to Coke.

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THE COMPETITIVE AREA AMONG COKE AND PEPSI

The soft drink market all over the world as been witnessing a neck-to-

neck battle between the two major players; Coca-Cola and Pepsi since very

beginning. The thirst quenchers are trying hard to have the major piece of the

apple of overall carbonated soft drink market. Both the players are spending

their energies in building capacity, infrastructure, promotional activities etc.

39

Coca-Cola, being 11 years older than Pepsi, has been dominating the

scene in most of the soft drink market of the world and enjoying the leadership

terms of the market share. But the coca-cola people are finding it hard to deep

away Pepsi, which has been narrowing the gaps regularly; the two are posing

threats for each other in every nook and corner of the world. While coca-cola

has been earning most of the part of its bread and butler through beverages

sales, Pepsi has a multi products portfolio with a handsome portion from the

same business.

The two warriors are face to face once again here in India with

different strategies and policies to attack at rival Coca-Cola is focusing upon

the joint ventures with the existing bottlers to enhance its control on

manufacturing and marketing of its product range and attain the quality

standards of its class. Countering its Pepsi has taken the baton in its own hands

by floating and investment of $95 millions to set 6 Pepsin Co. India Holdings,

a subsidiary for company’s owned bottling operation (COBO).

Both of the companies are following different path of reach the same

destiny i.e. to fetch the bigger portion of aerated soft drink market in India

Both the competitors have distinct vision and priorities about the

Indian soft drink market. Through having so much difference and distances

with each other, they both consider India as a huge potential market as per

capita consumption here in more 3 servings per year against an international of

80. Throughout, they are putting their best efforts to woe Indian consumer

who has to work for 1.5 hours to by a bottle cross over for both the athletes

running for getting No.1 position.

Coca-Cola is well set with its 53 bottling sites throughout the country

giving it an edge over competition by possessing a well built manufacturing

and distribution set up on the other side of picture, Pepsi, with two more year

in India, has been able to set an image of winner this giants are ready to turn

every stone of opportunity with a mindset of long tenure this time.

40

Coca-Cola has been penetrating the market through its wide product

range with a determination to change competition pattern of soft drink in

India. Firstly, they upgraded the whole industry by introducing 300 ml bottles,

which in turn, had given the industry a booming growth of 20 % as compared

to earlier 5%. They want to develop a coca culture here and are working on a

strategy to offer soft drink in every possible package. In coca-cola camp, the

idea of competition has not come from Pepsi, but from the other beverages

such as tea, coffee, nibu pani, water etc.

Pepsi is quite aggressive in its approach to Indian consumer. They are

desperately working in the strategy to be winner side in the hot cola war

between tow big barons. According to Pepsi philosophy it’s the madness that

encourages executives to thin to conjure up those creative tactics to knock the

fizz out of their competition. Pepsi had pumped a large amount on the

visibility of its blue-red-and-white logo. They have been going with

aggressive marketing by putting Sachine Tendulkar and now Shahrukh Khan

in their advertisement to endorses their brand, the role models for its targeted

consumer the teenagers. They have increase the fizz in the market price by

introducing the dispensers called fountain Pepsi and been enjoying a lead over

its rival three.

Coca-Cola on the other hand, has been working on the saying ‘skew’

and stead with ‘race’, side by side retailing to the every move of its

competitor. They have produced the shield of Thums Up with a handsome

market share in India soft drink market. Countering Pepsi; international

commercial that used two chimpanzees to coke a snack at coke, Thums Up

came with the aid line, “Don’t be Bandar, taste the thunder” Also Thums Up

has been positioned now very near to that of young in age of Pepsi and giving

it tuff time.

Everything has been put on fire by these cool merchants. If Coke got

the status of the “Official drink of Wills World Cup”, Pepsi blushed as

“Nothing official about it”. As Thums Up projected as ‘Saare Jahan Se

Achchha’. Pepsi was passionate enough with ‘Freedom to be’. When Thums

Up came up with ‘Thunder Blast’, the other one offered, Pepsi ‘Stuff Card’. If

41

red color is meant for Coke, Pepsi has chosen to be Blue. In this way, Indian

consumer is getting more fizz and punch from the two big brothers and he has

to given not about the winner.

42

43

MARKETING DEPARTMENT

Marketing is getting right goods and services at right time and right

place to right people at right price with right communication.

The comprehensive marketing activity at Kanpur Marketing Services is

controlled by Mr. Deepak Rewari (G.M.). Today consumers have different

measurements to buy above which has a smaller self-life. The major market of

soft drink is under the grab of local distributions, which provides the innocent

consumer’s all the sort of connections.

In such scenario educating the consumer and winning confident with

quality product is an uphill task because traditions are different to break.

Marketing department looks, after from loading of bottles to suggestions,

problems faced by customers. They have about 1200 retail points for exclusive

distribution, 18 wagons run for playing the products to their points. Retailers

get their demands fixed on the telephone to the marketing department, which

is transformed into charts. There demands are aggregated and given to the

personnel or supervisors at clock these personnel are of production

department.

Right from the first year of the incorporation the company is running in

top profit. This is because of many reasons. One of them is being that there is

no other bottling plant nearby. Also the company gives good margins to the

retailer’s along with various lucrative from time to time.

44

45

SALES PROMOTION TECHNIQUES OF COMPANY

1. Good Advertising.

2. Effective Incentive Policy.

3. Quality.

4. Wide & Deep Distribution System.

5. Attractive packaging.

6. Allotting SGA’S (Refrigerator, Chest cooler, Table Umbrella, Chairs

etc.) to retailers.

7. Decorating Retailers shop by display board, dealer’s board etc.

CRITERIA FOR PROVIDING FREE CHILLING

EQUIPMENTS

With every 1-2 crates purchased daily or alternatively an

icebox is provided.

For an average consumption of 5-6 crates a visi-cooler of

4crates.

For a purchase of 7-8 crates daily visicooler 7 crates.

If purchase exceeds 8 crates, then 9 crates visicooler or deep

fridger is provided.

With every chilling equipment a steplizer is provided it may be of 1

KV or 5 KV.

46

S.G.A PROVIDING COMPANIES

Whirlpool India Ltd.

Godrej G.E. Appliances Ltd.

Western Refrigeration Ltd.

Rockwel Industries Ltd.

All these industries are enlisted and approved by Coca-Cola.

PROMOTION BY THE COMPANY

All advertisement expenditure is incurred by coca-cola India, but only

D.P. Board, wall painting, S.G.A.’s etc. Company spends on it around 8-9 %

total sales company invested 305 crore rupees in advertisement Budget.

Radio.

T.V.

Hoardings.

Road signs.

Sticker.

Neon light.

Banners.

Newspaper.

Magazines.

Exhibition.

Posters.

Sponsoring local events.

SOME OTHER TECHNIQUES FOR PROMOTION OF

COCA-COLA COMPANY

47

THESE ARE THE CANS WHICH LAUNCHED IN

BETWEEN OLYMPIC GAMES IN EVERY YEAR IN THE

PAST

Olympic Commemorative Cans

1928

1948

1964

1992

48

1996

49

50

ADVERTISING

Advertising is non-promotion of goods and services, by a sponsor (a

firm or person) who can be identified and who has paid for this

communication. This purpose of advertisement is to sell something a good

service, idea person or place, either now or later this goal, reached by setting

specific objective that can be expressed individual ads. Those are incorporated

into an advertising campaign recall again from the buying decision process

that buyers go through a series of stages from unawareness to target customers

to the next stage in the hierarchy say from awareness to interest.

Specific advertising objective will be dictated by the firm’s overall

marketing strategy. Typical objective are:

a. Support personal selling advertising may be used to

acquaint prospect with seller’s company and product,

easing the way for the sales force.

b. Improve dealer relations: wholesalers and retailer like to

see a manufacturer support its product.

c. Introduction new product: consumer needs to be

informed even about line extensions that make used of

familiar brand name.

51

Bareilly beverage lays emphasis on advertising at the core centers.

They lay their banners and hoardings at the important places and see to it that

they do space on media.

The product like Thums Up, Fanta, Limca and Maaza belong to one

group i.e. coca-cola, advertise on nation side basis for its products, by hireling

time and space on media.

To promote the product and to create the awareness of the product

every year they are spending Rs.10/- per crate for the advertisement. They are

spending the amount for wall painting, dealer’s board, glow signs, hoardings,

banners, stickers, posters and buntings.

Advertisement plays an important role in the success of coca-cola

product since its first newspaper ad. In 1886 that red, coca-cola delicious

“Refreshing Exhilarating” Invigorating”. Advertisement is a key of

implementing a strategy over one hundred year old to trigger desire as offer

and in as many ways as possible.

ADVERTISEMENTS TARGETED BY COKE

To target various consumer segment of soft drink different add

featuring cricket star, cine star, pop star have been created.

1.Lisa Ray (famous model) in a very interesting add, which featuring

him bathing with sprite. Having a catching line “Sprite bujhaye only

pyass baki all bakwaas”.

2.Amir Khan & Ashwarya Rai (both cine stars), which targeted

younger generation. This add. Contained imagery of rugged and

romantic for 330 ml of coke. Theme “ Coca-Cola Ho Jay”.

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3.Another cola drink from coke i.e. “Thums Up”.

4.Limca leaving its old image of “Lime-n-Limoni” drink is been

shown as in the add. Featuring Shaif Ali Khan. A drink that could just

change the mood at time of disappointment lines. “Gala Gaya Sookh

Limca Key Liye Ruk”.

5.Fanta add. Showing children having lines “Bold Ho Jayo”.

6.A family giving new look to Maaza “ Tazza Mango”.

7.Diet Coke the exiting add. on the pool with fall swing calling “Taste

The Power Of One Calorie”.

8.Amir Khan in the as on Mini Coke very interesting and Roman tic

add.

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54

OBJECTIVES OF THE STUDY

The R.E.D. survey was done to find out the present status of Thums

Up, Coca-Cola, Fanta, Limca & Maaza in the retail outlets.

To find the receptivity of the brand among the retailers and consumers

particularly of eating & drinking, grocery store, and convenience

shops.

To study the distribution and marketing strategy of thums up, coca-

cola, fanta, limca, and maaza- the major competitor in this category.

To find out available opportunities in the market by finding gaps in

competitor’s penetration.

To collect data about the retailers that can be used for activating new

channels and merchandising opportunities.

To find out ways to increase the sales of the new launches in different

channels.

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Review of Literature :

K. T. Jagannathan Coca Cola India to expand.The Hindu.Tuesday, Jun 03, 2003.

Having seen a `modest profit' for the first time since it set foot in India,

multinational Coca Cola has trained its eyes on beefing up the per capita consumption

of soft drink in the country even as it is readying for a horizontal expansion into rural

areas.

Disclosing this in an exclusive interview with The Hindu here today, Patrick T.

Siewert , Group President (East and South Asia), said, "We will continue to focus on

profitability because we have invested nearly a billion dollar in India since our entry".

It had not repatriated any money back thus far. Asserting that "we need to see a return

on those large investments," Mr. Siewert, nonetheless, said, "we are taking a long

term view of that".

While declining to divulge the `modest profit figure' of its Indian operation in 2002,

he admitted that at least one-third of the profit was contributed by the decision of the

parent to write off the accumulated loss of over Rs. 2,000 crores. "Nearly two-thirds

of the profit are brought about by operational improvements that are driven by right

cost, execution and strategy," he claimed.

Fielding a range of questions, Mr. Siewert said the strategy of providing affordable

quality soft drinks had worked for Coco Cola. The focus of the company would be on

"building per capita consumption by making the soft drink an everyday affordable

item for the millions of people in India," he said.

The President saw a huge opportunity in rural areas. He said "the horizontal

expansion is still available to us" even though "we often talked about rural

expansion".

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Mr. Siewert asserted that the soft drink business, notwithstanding the negative

perception in the minds of some, had been driving the growth in the domestic market.

In this context, he pointed out that Coca Cola had been buying $300 million worth

raw materials from within the country. It had been the largest buyer of sugar in Tamil

Nadu and had been keeping the glass and crate industries ticking. It had also been

picking up close to 8 per cent of refrigerator capacity in the country. He reckoned that

every one direct job in the Coca Cola system had resulted in 30-40 odd related jobs

elsewhere.

Precisely because of the multiplier effect that the soft drink industry was capable of

generating, he wanted the States to set out the right investment climate. Mr. Siewert,

in fact, had a meeting with the Tamil Nadu Chief Minister this afternoon. So far, Coca

Cola had invested $10 million in India this year. About 45 per of it had flowed into

the South, he pointed out.

Asked if Coca Cola's thrust on horizontal expansion would see a market-specific

pricing of products, he said the current price — Rs. 5 for 200 ml, Rs. 8 for 300 ml, Rs.

38 for 1.5 litre and Rs. 43 for two litres — fitted well in rural markets as well. He said

`lower pricing' need not bring good for consumers all the time. In his reckoning, price

points should be supported by right cost positions and return on investment. Mr.

Siewert said all long term assets of the Indian subsidiaries were funded by equity and

the working capital needs by domestic debt. To a question, he said Coca Cola had

divested 49 per cent of the equity in favour of India investors. While declining to

divulge the name, he said at least 10 per cent had been picked up by employees,

suppliers and bottlers.

Mr. Siewert asserted that India and China were on top of Coca Cola's priority in its

global game plan. While the Chinese market was larger than India, the former was not

growing as fast as the latter.

Going forward, the company was proposing to open 1.50 lakh new outlets this year

and a similar number next year as part of its horizontal expansion strategy even as it

kept its eyes open for opportunities in new categories of beverages.

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Global Competition Policy Magazine. A Hard Landing in the Soft

Drink Market - MOFCOM's Veto of the Coca-Cola & Huiyuan

Deal . April 2009

China’s Ministry of Commerce (MOFCOM) vetoed the proposed acquisition

by Coca-Cola of Huiyuan, a company with an important presence in the Chinese fruit

juice market. This is the first time that MOFCOM has prohibited a transaction under

the Anti-Monopoly Law (AML), in effect since August 2008.

MOFCOM gave three reasons for blocking the transaction. First, in its view, Coca-

Cola might be able to leverage its dominant position in the market for carbonated soft

drinks into the fruit juice market. Second, MOFCOM found that the addition of the

Huiyuan brand name to Coca-Cola’s own fruit juice brand could increase entry

barriers. Third, MOFCOM expressed concern that the transaction could negatively

affect the ability of domestic small- and medium-sized companies to compete.

This paper critically examines several interesting aspects of MOFCOM’s prohibition

decision. In particular, it discusses the insufficient degree of transparency which

characterizes MOFCOM’s merger control regime at present. Then, an attempt to

analyze MOFCOM’s substantive antitrust reasoning in the decision is made. Finally,

the paper focuses on the actual or potential influx of non-competition policy

objectives into MOFCOM’s assessment.

G.Chandrashekhar A multi-faceted FMCGs.Business Line. Monday,

May 03, 2010

Maize or corn is by far the largest cereal FMCG grown around the world. In the last

three years, global FMCG output averaged 800 million tonnes. The US is a dominant

producer and consumer.

Traditionally, it is used for humans and feed for livestock and poultry. Industrial uses

include making of starch. In recent years, with emergence of bio-fuels, corn is used

for production of ethanol for blending with gasoline. The new demand segment has

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helped expand corn utilisation, but tightened availability of the cereal for the

traditional uses as food and feed.

India ranks among the top 10 of world's maize producers. Indeed, in our country,

maize is an exceptional success story among generally poorly performing cereals.

Acreage and output have been steadily rising. Currently, this coarse grain is cultivated

in about 8 million hectares and the yield is approximately 2.3 tonnes a hectare. Less

than a quarter of the planted area is irrigated.

Although the cereal is produced virtually across the country, Andhra Pradesh,

Karnataka and Rajasthan are among the top producing States. Cultivated mainly in the

kharif season, maize recorded output of 18.9 mt in 2007-08 and a record 19.7 mt in

2008-09. There is tremendous scope for raising yields through improved input

management and agronomic practices. The crop is susceptible to vagaries of

monsoon. No wonder, total production in 2000-10 declined to 17.3 mt following

inadequate precipitation last year.

In the US, introduction of genetically modified corn (Bt corn) has helped raise yields

and cut losses arising out of pest and disease attacks. India is an occasional exporter

of maize to the world market; but the volumes are modest. Rising domestic demand

from food, feed and industrial sectors has resulted in tightening availability and firm

prices. Going forward, a robust growth in the livestock and poultry industry is sure to

translate into higher demand for feed corn. Some reports project such requirement at

30 mt by 2020.

Obviously, to ensure future self-sufficiency, India needs to plan to raise production

through productivity increases. It calls for planning and investment. Higher

production must come not from horizontal expansion of acreage but from vertical

growth in yields. But, there are challenges. Land availability and water shortage are

likely to be constraining factors. Worse, it is said that Indian maize is at the limit of

heat tolerance. In the event, global warming and climate change can potentially affect

yields that are even otherwise low by world standards.

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We need to start researching heat-tolerant and drought-tolerant varieties. The user

industry, mainly poultry and animal feed industry, can contribute to strengthening

maize production and productivity.

Maran invites Japanese textile cos to India.Business Line.Thursday,

Jul 23, 2009

To diversify textiles and clothing exports and to reduce dependence on the US and EU

27, the Government is promoting exports to South East Asia under its ‘Look East

Policy’.

The Minister of Textile, Mr Dayanidhi Maran, has invited the Japanese textiles

industry to collaborate with the Indian textiles industry in manufacturing of fabric and

garmenting, setting up of greenfield units in textiles machinery, manmade fibre and

yarn and create brand equity with Indian apparel companies.

He inaugurated the Indian pavilion at Japan’s premier International Fashion Fair

earlier.

Mr Maran was addressing the business meet hosted by the Japan-India Business

Cooperation Committee on ‘Current status of Growing Textiles Industry and

investment opportunities’ in Tokyo.

During the interaction with the top 50 Japanese businessmen, which included many

from the textiles industry, the Minister apprised them of various advantages in

investing in India, particularlyin the textiles sector, which has a highly skilled

workforce, high capital-employment ratio and immense potential to promote

employment, and a strong and diverse raw material base.

“India is the largest producer of jute, second largest producer of cotton and man-made

fibre and yarn, and third largest producer of silk. India has a vertical and horizontal

integrated textiles value chain, and represents a strong presence in the entire value

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chain from raw material to finished goods. The average labour cost in India is $ 0.7 a

hour compared to $ 20 a hour in Japan,” he added.

Outlining the investment scenario in the Indian textiles sector, Mr Maran said that

investment is expected to increase from $ 22.3 billion in 2004-08 to $ 30.9 billion by

2010.

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R.E.D CONCEPT

ABOUT THE R.E.D SURVEY

The survey named as R.E.D. (RIGHT EXECUTION

DAILY).

The survey has been conducted to check the cooler

management, availability of products & activation

of coca-cola in various outlets.

The survey was based on three topics :-

Firstly, I have to check the cooler management i.e.

the cooler that was provided by the company to the

customer, are properly managed/working or not.

And lastly the most important aspect of cooler

management was the brand order.

Secondly, I have to check the availability of the

product i.e. whether the product is available to the

customer or not.

Lastly, I have to check the activation, which is a

very important because activation helps to boost the

sales. Activation is done through boards i.e. glow

sign. DPS, Flanges and Combo boards. Mostly

combo boards are given to the E&D outlets. And is

very helpful in attracting the customers. Rack with

header is provided to the Grocery outlets, which

should be fully charged.

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MARKET SEGMENTATION

CHANNELS

Which type of outlet is this like E&D (Eating & Drinking), GROCERY, or CONVENIENCE?

E&D : Like restaurant must have 5 tables with chairs.

GROCERY : Like general store.

CONVENIENCE : Like Pan Shop.

CLASSES

Which class outlet has like BRONZE, SILVER, GOLD, or DIAMOND?

BRONZE : Those outlets, which sells less than 200 carets per year.

SILVER : Those outlets, which sells 200-499 carets per year.

GOLD : Those outlets, which sells 500-799 carets per year.

DIAMOND : Those outlets, which sells 800 & above carets per year.

INCOME

Whoever costumer comes on shop which income class they belongs like high Income, medium Income, low Income.

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R.E.D.

(RIGHT EXECUTION DAILY)

OUTLET WISE DISTRIBUTION OF R.E.D

CHANNEL CLASS LOCALITY INCOME

GROUP

Convenience Diamond High

Ex –Pan shop, P.C.O etc. 800c/s sale

Grocery Gold Medium

Ex – General store, 500-799c/s sale Provision store etc.

E&D (Eating and Drinking) Silver Low

Ex – Restaurant, Hotel etc.

PRE-SALE CONCEPT

This is the new concept that had started from the year 2007. In the Pre-Sale the company takes order one day before and accordingly company

delivers their products for each route.

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What is Horizontal Expansion?

Expansion of business capacity through the absorption of facilities or

buildings as well as through the acquisition of new equipment to handle an increased

volume in sales in which the business is already engaged. In microeconomics and

strategic management, the term Horizontal Expansion describes a type of ownership

and control. It is a strategy used by a business or corporation that seeks to sell a type

of product in numerous markets. Horizontal Expansion in marketing is much more

common than Vertical Expansion is in production. Horizontal Expansion occurs when

a firm is being taken over by, or merged with, another firm which is in the same

industry and in the same stage of production as the merged firm, e.g. Pepsi has

adopted strategy of Vertical Expansion by which Pepsi wants to improve it’s sale

from Coke monopoly outlets, means Coke’s monopoly outlets are being taken over by

Pepsi now in this condition to improve it’s sale Coke need to open new outlets which

is called Horizontal Expansion Strategy. A monopoly created through Horizontal

Expansion is called a Horizontal Monopoly.

This is the expansion of a firm within an industry in which it is already active

for the purpose of increasing its share of the market for a particular product or service.

Reason Of Horizontal Expansion?

The ultimate objective of coke is to acquire more customer and serve them

properly. While doing Horizontal Expansion take care to the competitor’s strategy.

The main competitor is PEPSI, who has opted Vertical Expansion to generate more

sell however Coke do not believe on Vertical Expansion because Vertical Expansion

has limited preview so COKE is great believer in Horizontal Expansion and this

strategy helped to the company to aintain its leadership in the soft drink industry.

India is a big country having diversified taste and appearance and same

character is reflected in their demography. Horizontal Expansion helps the company

to serve the more people and more customers touch point because in the waste

country many customers commutes.

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Benefits of horizontal expansion:

Provides Incremental Volume & Revenue for Business

By horizontal expansion there will be more outlets of our product In the market

which will sell our product in more quantity. This will generate incremental revenue

for the business.

Helps Improve Route Productivity

There are pre determined routes through which product is transported and

delivered at the coke outlets. If we open more outlets on the routes it will increase the

productivity because more outlets will be covered and more product will be delivered

with a negligible increase in time and efforts. Hence it will improve productivity of

the route

Improves Profitability of Our Distributors Expenses on routes and delivery of

product are incurred by the distributers. Opening new outlets will give more revenue

to our distributors also. With the increase in route productivity will improve

profitability of the distributors.

Reduced Dependence on Large Customers, We know that coke products have a

very good demand. To comply with this we have to provide large amount of supply.

In case we have few outlets a large amount of stock is gathered at few retailers. In this

case they become monopolistic and demand many things like coolers refrigerators

discounts margins etc. from the company. So it is very necessary to reduce

dependence on large retailers by opening new outlets.

Increase market visibility Selling at more outlets give more market visibility of

the product which gives higher product recognition and brand value to the products.

Economies of scale

Economies of scope

Increase in market power over supplier and downstream market channels.

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Advantage of horizontal expansion over vertical expansion:

Both expansion techniques are meant for increasing sales volumes. But in horizontal

expansion company can earn more profits by spending less. Let’s see the profit story

of horizontal expansion.

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RESEARCH METHODOLOGY

This research involved a study, which was descriptive in nature it basically

aims at gathering data about how the coca-cola scheme playing in the mind of

shopkeepers & consumer.

METHODS OF DATA COLLECTION

THERE ARE TWO TYPES OF DATA

1. Primary data

2. Secondary data

1. Primary data collection : Primary data can be collected by three

methods;

a) Observation

b) Experiment

c) Surveys

But here, only surveys method of data collection is preferred which is very

suitable to reach the researcher motto.

A. Research instrument : Printed Questionnaire

was used as the research instrument to collect the

required information.

B. Area of surveys : The survey was conducted in

different location of Kanpur city.

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Sampling plan: sampling plan consists of

I. Sampling unit : The retailer of Grocery shop,

general store, betel shop, and medicine store was

selected from different places of kanpur

II. Sampling size : 250 Outlets.

III. Sampling procedure : Simple random sampling

procedure was followed.

IV. Sampling method : Data were collected by retailer

survey. The retailers are directly contacted and

interviewed at their retail counter.

2) Secondary data collection : As secondary data were not

available with shopkeepers as well as stockiest, so these were

collected from company records.

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ANALYSIS OF DATA

DATA ARE COLLECTED FROM DIFFERENT LOCATION OF KANPUR

LIKE:

1. LALBANGLA

2. JAGAI PURWA

3. OM PURWA

4. SWAROOP NAGAR

5. JAJMAU

6. SHIVKATRA

7. HARZENDRANAGAR

8. K.D.A. COLONY

9. DEFENCE COLONY

SURVEY ANALYSIS

THE SURVEY WAS CONDUCTED IN DIFFERENT LOCATION

OF KANPUR.A TOTAL SURVEY OF 250 OUTLETS WAS CONDUCTED.

SIZE OF VISI-COOLER IN 250 OUTLETS

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Here 82% Retailers are having 6 shelf Freezer,7% Retailers are having De-

Freezer, 8% Retailers are having 8 shelf Freezer, 1% Retailers are having 4 shelf

Freezer & 2% Retailers are having Double Door Freezer.

IS PRE-SELLING GOOD OR THERE IS SOME GAP AT THE

DELIVERY TIME OF THE PRODUCTS?

1.GOOD2.GAP

So 200 respondents say that Pre-Selling Concept of Coca-Cola is good while

50 respondents are saying that Pre-selling concept of Cocal is not goodbecause of

distribution system.

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LEADING BRAND OF THE COCA-COLA COMPANY ACCORDING TO THEIR PREFERENCES

So among all the products of coca-cola 63% market covered by Thumsup, 14% market covered by Sprite, 8% market covered by Mazza, 7% market covered by Coke, 6% market covered by Limca & 2% market covered by Fanta.

CHANNEL OF THE COCA-COLA COMPANY CONSIDERING SURVEYED (250) OULETS.

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OULETS BELONGS TO WHICH CLASS MADE BY THE COMPANY?

INCOME GROUP OF THE OUTLETS.

Here 54 % Market covered by high income groups which includes Diamong & Gold Classes, 31% Market covered by Medium income groups which includes Silver Class & 15% Market covered by low income groups which includes Bronze Class.

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MARKET SHARE OF COCA-COLA COMPANY COMPARING WITH PEPSI COMPANY

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CONCLUSION

EVERY THING IN THIS WORLD IS MADE TO UTILIZE PROPERLY

BUT IT SHOULD BE REACH AT THE PROPER PERSON OR TO THE

PROPER UTILIZED AREAS. OTHERWISE THE VALUE ADDED TO

THOSE THINGS BECAME IN VEIN.

AS THERE IS A PROVERB THAT,

“FAR FROM EYE, FAR FROM HEART”

THUS MARKETING ROLE PLAYS A VERY IMPORTANT ROLE IN

ACHIEVING THE OBJECTIVES OF A COMPANY. UNDOUBTLY,

VALUE UTILITY IS CREATED BY THE MANUFACTURE OF

PRODUCT OR SERVICE BUT TIME AND PLACE UTILITIES ARE

CREATED BY MARKETING ROLE. ACCORDING TO DRUCKER,

“BOTH THE MARKET AND THE DISTRIBUTION CHANNELS ARE

OFTEN MORE CRUCIAL THAN THE PRODUCT”. THEY ARE

PRIMARY: THE PRODUCT IS SECONDRY. IN AN ECONOMY LIKE

THAT OF INDIA, WHERE MARGINAL SHORTAGES CAN LEAD TO

DISPROPORTATION DISTORTION IN PRICES, A DEPENDABLE AND

EFFICIENT DISTRIBUTION SYSTEM IS VERY MUCH ESSENTIAL.

THE DISTRIBUTION SYSTEM CREATES A VALUE ADDED TO ALL

MOST ALL PRODUCTS.

ALL FROM THE ABOVE STUDY NOT WITHSTANDING ITS

RESTRUCTING EFFORTS PEPSI IS STILL FAR AWAY WITH ITS

GREAT COMPETITOR LIKE COKE.

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FINDINGS

THE MOST POPULAR FLAVOUR IN THE MARKET IS THUMS

UP.

COCA-COLA IS MARKET LEADER AND PEPSI IS THE

MARKET CHALLENGER IN THE WHOLE MARKET WHERE I

HAVE SURVEYED.

FROM THE COCA-COLA PRODUCTS THUMS UP AND THE

PEPSI PRODUCTS DEW IS THE HIGHEST SELLING IN THE

MARKET.

COCA-COLA IS THE MARKET LEADER IN OVERALL

MARKET.

IN SOME AREAS LIKE LAL BANGLA THE SUPPLY OF PEPSI IS

BETTER THAN COCA-COLA.

I HAVE FOUND THAT A RETAILER GIVES MORE PREFENCE

TO THE COCA-COLA PRODUCTS LIKE THUMS-UP, MAZAA,

SPRITE, AND FANTA.

SALES HAVE INCREASED AFTER LOCATING VISI COOLER

OUTSIDE OF OUTLET.

THE COMPANY NEW CONCEPT PRE-SALE GOT THE GOOD

RESPONSE MEANS THE CONCEPT OF PRE-SALE PREFERS BY

THE RETAILERS.

THE STORES ARE CATEGORISED ON THE BASIS OF THEIR

SALE, IT MEANS DIAMOND, GOLD, SILVER, BRONZE..

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SUGGESTION

THE COMPANY SHOULD WORK OUT IN THEIR COMPLAINES

REGARDING TO THE VISI COOLER AND STABLIZER.

COMPANY SHOULD GIVE PROPER SCHEMES TO THE

OUTLET.

THE REFRIGRATOR PURITY SHOULD HAVE THE PRIORITY.

OVERALL SERVICES SHOULD BE IMPROVED FOR GETTING

MORE SALE AND TO BE THE MARKET LEADER.

THE SALES EXECUTIVE SHOULD TRY TO AVOID MAKING

FALSE COMMITMENTS FOR RELISING SHORT TERM GOALS.

NUMBER OF HOARDING SHOULD BE INCREASED.

FLORESCENT BOARD DISPLAYING LOCATION AND THEIR

DISTANCES ON ROAD SHOULD BE USED HAVING COCA-

COLA WRITTEN ON THEM.

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Surveyors Name: ________________________ Outlet Name: ______________

Address: _________________________________________________________

Mob: ________________________Age____________ Sex ________________

1. Are you retailer of Coca-Cola?

Yes No

2. Under Which Channel does your shop comes under?

E & D Grocery Convenience

3. Is a Coca-Coca vesi cooler present in your shop?

Yes No

4. What is the size of your Vesi-cooler?

4-shelf 6-Shelf 8-Shelf Double Door De-Freezer

5. According to you, Company’s pre-selling Concept is-

Good Gap

6. According to you, Which flavor is the most preffered one among customers?

Thumsup Coke Sprite Limca Fanta

Maaza

7. Your outlet comes under which class?

Diamond Gold Silver Bronze

8. According to you, the income of your outlet is –

High Medium Low

9. According to you, which company’s products are having greater demand?

Coca-Cola Pepsi

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REFRENCES

WEBLIOGRAPHY :

1. http://www.scanaxn.com/doc/11465324/BC-Cocacola-Summer-Training-

Full-Report

2. http://www.pdftop.com/ebook/

bcg+matrix+of+coca+cola/

3. http://findarticles.com/p/articles/mi_m0EIN/

is_2007_Dec_10/ai_n21149578/

4. http://www.oppapers.com/subjects/horizontal-expansion-in-coca-cola-

page1.html

5. http://www.hinduonnet.com/2003/06/03/stories/

2003060301601800.htm

6. http://papers.ssrn.com/sol3/papers.cfm?

abstract_id=1396968

REFERENCE BOOKS

Kotler Philip,”Marketing Management”.Dorling Kindersley (India) Pvt. Ltd

New Delhi,13th Edition,2009

GUPTA S.P, “Statistical Methods” Sultan chand & sons Publishers New

Delhi, Thirty fourth editions, 2005

83

KOTHARI.C.R, “Research methodology- Methods & Techniques” New Age

International (P) Ltd. New Delhi, Second edition,2004

RED SCORING SHEET

Surveyors Name: __________ Outlet Name: ______________

Address: _________________ Channel: ________________ Category

(D/G/S): ________________ Class (H/M/L):

___________________________

KANPUR S.NO. E&D GROCERY CONVENIENCE

VISICOOLER

1. Is a coca-cola cooler present?

Visicooler/chest cooler.

2. Is the cooler as per standard?

3. Is the vesi cooler in the prime position?

4. Is the visicooler in a working condition?

Not working/unclean

5. Is the visicooler light working?

6. Is the cooler 100% pure?

7. Is the cooler brand-order compliant?

TOTAL

AVAILABILITY

9. 300 ML (COLA+3)

10. Mobile PET (COLA+3)

11. Maaza RGB

12. CAN (COLA+1)

13. MAAZA PET 600ML & 1.2 LTR.

14. 1.5 LTR. PET (COLA+3)

TOTAL

ACTIVATION

E & D

15. COMBO BRANDS ( AT LEAST 3)

16. TENT CARD(MIN 5 OR PRESENT ON

ALL TABLES

17. FLANGE ROAD STANDEE OR GLOW

SIGN BOARD

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GROCERY

18. DISPLAY RACK WITH HEADER

19. IS THE RACK PURE AND CHARGED

20. SHELF DISPLAY

CONVENIENCE

21. TABLE TOP DISPLAY

22. DPS BOARD, GLOW SIGN OR

FLANGE

GRAND TOTAL

SIGNATURE OF SURVEYOR

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