A

PROJECT REPORT
ON
COMPARATIVE STUDY OF
“ANALYSIS OF COCA COLA”.

Submitted to: Submitted By:

Miss Anjali abhishek ranjan

(Session 2008-2010)

S.A.S Institute Of IT & Research, MOHALI

 ACKNOWLEDGMENT

I express my deep sense of gratitude to Mr. Rohit Sagar Marketing

manager of Ludhiana Bottling Co. Jalandhar and all the sale force of
company for their valuable guidance and constant encouragement
throughout the course of this study.
With a profound sense of gratitude I thank Mr. Parveen Singh Guleria
Sale Manager who helped me immensely in completing the work by his able
assistance and guidance.
I extend my sincere thanks to the whole Staff of Ludhiana bottling Co.
Jalandhar for giving their cooperation in providing me the secondary data.
Last but not least; I want to thank all the people who worked behind
the scenes, without whose help this report wouldn’t have materialized.

submitted By:
Abhishek ranjan
 PREFACE

MBA is stepping stone to management career in order to develop a

healthy management and administration skill among potential managers.
Someone has rightly said that partial training is far better then the classroom
training. To achieve partial and concrete results, it is necessary that
theoretical knowledge must be supplemented with an exposure of real
business environment.

In order to achieve practical positive and results along with theoretical

concepts, the exposure of real life situation is very much needed. To fulfill
the need the management course has the provision of practical learning.

In the forthcoming pages, an attempt has been made to present

comprehensive report concerning different aspects of my project report.
 Contents

1. Introduction

2. Objective of study

3. Importance of study

4. Research Methodology

5. Analysis

6. Limitations

7. Recommendation

8. Bibliography
 Introduction

Soft drink market an introduction

It all begin in1886, when a three legged bras kettle in John Smyth in
Pemberton’s backyard in Atlanta was brewing in the first p of marketing
legend unaware, the pharmacist had given birth top caramel colored syrup
which is now the chief ingredient of the world’s favorite drink. The syrup
combine with carbonated water to fuel a multi-billion dollar industry that has
captured the soft drink market. It is estimated that the drink is served more
than one thousand million times a day. In 1884, this beverage got in top
bottle, courtesy a candy merchant form Mississippi. By the 1950’s colas was
a daily consumption item store in household refrigerators. Soon were born
non-cola variant of this products like orange and lemon. The company in the
80's and 90's had focussed on centralizing its operations for enabling
effective management of a vast global enterprise that was being spread over
200 countries. It has now woken up to the fact that the world is changing
very fast today and that a localized management that can quickly respond to
the challenges and needs of the relevant market will be critical to success,
rather than a unified management at the centre. And that is precisely what
Coca-Cola has set out to do. It appears to be handing out a greater degree of
freedom and responsibility to the frontline managers in their respective areas
of operations. It has decided to cut jobs and convert itself into a leaner
structure. In India too, the complex holding structure has been broken down
and converted into a simplified structure. A single holding company
Hindustan Coca-Cola Holdings Pvt Ltd and one downstream subsidiary -
Hindustan Coca-Cola Beverages - formed by the merger of 4 bottling
subsidiaries of Coca Cola and that of Schweppes now operate in India. The
parent has performed a comprehensive review of its Indian bottling
operations and has announced that it will be writing off $400mn worth of
assets in India in the first quarter of this year.

The meeting hosted last week by the company to update investors on its
business strategies and outlook for the future also sang the same tune of how
members of the global Coca-Cola management team are implementing their
"Think Local, Act Local" philosophy. The company's focus, according to
the management, will be to encourage higher consumption of non alcoholic
beverages and the Coca-Cola brands in every country. This will be achieved
through an intense focus on consumers, communities, customers, the Coca-
Cola system and Coca-Cola people. The Consumer focus strategy involves
using innovative and tailored marketing programs based on local consumer
insights to enable the company to keep growing.. "We want to ensure that we
have a tailored nonalcoholic beverage portfolio in every community that
touches consumers in locally relevant ways." states the annual Report of the
company.

Three major players have dominated this industry:

 The NEW YORK based PEPSICO.INC.

 The ATLANTA based COCA\COLA CO.

 The UK based CADBURY’S SCHWEPPS.

Non-alcoholic soft drinks beverage market can be divided into fruit

drinks and soft drink. Soft drinks can be further divide into carbonated and
non-carbonated drinks. Cola lemon and orange are carbonated drinks while
mango drinks come under non-carbonated category. The soft drinks market
till early 1990’s was in hand of domestic player like campa, thums up ,limca
etc but opening up op economy any coming of MNC player Pepsi and coke
but this difference is fast decreasing (country huge ad spending by both the
player). Pepsi entered Indian market in 1977, with the central government) in
1993.

Cock has been targeting its products towards youth and it has struck right
chord with the market and the sale have been doing well by sticking to this
youth bandwagon. Pepsi on the other hand struggled initially in established it
self in market. Soft drinks are available in glass bottle, aluminum cans and
pet bottles for home consumption. Fountains also dispense them in
disposable containers.

Coca-Cola in India

After a 16-years absence, Coca-Cola returned to India in 1993. The

Company's presence in India was cemented in November that year in a deal
that gave Coca-Cola ownership of the nation's top soft-drink brands and
bottling network.

Coca-Cola India has made significant investments to build and continually

improve its business in India, including new production facilities,
wastewater treatment plants, distribution systems and marketing equipment.

During the past decade, the Coca-Cola system has invested more than US$ 1
billion in India

Coca-Cola is one of the country's top international investors

In 2003, Coca-Cola India pledged to invest a further US$100 million in its

operations

Coca-Cola business system directly employs approximately 6,000 local

people in India

In India, we indirectly create employment for more than 125,000 people in

related industries through our vast procurement, supply and distribution
system

Virtually all the goods and services required to produce and market Coca-
Cola locally are made in India
The Coca-Cola system in India comprises 25 wholly-owned company-
owned bottling operations and another 24 franchisee-owned bottling
operations

Manufacturing process

Soft drinks may be carbonated or non-carbonated. For carbonated drinks

carbonation forms critical parts of the process. In carbonated carbon dioxide
is dissolved in the water, which is use in the manufacturing the drink.
Normally the ingredients in soft drink are alas follows- acidulate (citric,
malice or phosphoric acid, sweetener, flavor preservative.

In a bottling plant, soft drink company’s supply concentrates to the bottlers

where it is diluted in the distilled water along with other ingredients in
specific proportion. The quality this mixture is maintained to strick controls.
 POLICY OF COCA COLA

The Coca-Cola Company exists to benefit and refresh everyone

it touches.
For us, Quality is more than just something we taste
or see or measure. It shows in our every action. We relentlessly
strive to exceed the world's ever-changing expectations because
keeping our Quality promise in the marketplace is our highest
business objective and our enduring obligation.

More than a billion times every day, consumers choose our brand of
refreshment because Coca-Cola is...

The Symbol of Quality

Customer and Consumer Satisfaction

A Responsible Citizen of the World

The world's favourite drink. The world's most valuable brand. The most
recognizable word across the world after OK.
Coca-Cola has a truly remarkable heritage. From a humble beginning in
1886, it is now the flagship brand of the largest manufacturer, marketer and
distributor of non-alcoholic beverages in the world.

India

In India, Coca-Cola was the leading soft-drink till 1977 when govt. policies
necessitated its departure. Coca-Cola made its return

to the country in 1993 and made significant investments to ensure that

the beverage is available to more and more people, even in the remote and
inaccessible parts of the nation.

Position/ Standing in the market place

Coca-Cola returned to India in 1993 and over the past ten years has captured
the imagination of the nation, building strong associations with cricket, the
thriving cinema industry, music etc. Coca-Cola has been very strongly
associated with cricket, sponsoring the World Cup in 1996 and various
other tournaments, including the Coca-Cola Cup in Sharjah in the late
nineties. Coca-Cola's advertising campaigns Jo Chaho Ho Jaye and Life ho
to Aisi were very popular and had entered the youth's vocabulary. In 2002,
Coca-Cola launched the campaign "Thanda Matlab Coca-Cola" which
sky-rocketed the brand to make it India's favourite soft-drink brand. In 2003,
Coke was available for just Rs. 5 across the country and this pricing
initiative together with improved distribution ensured that all brands in the
portfolio grew leaps and bounds.
 SKUs

Glass PET Can Fountain

Various
200 ml 500 ml 330 ml
Sizes
500 ml + 100 ml
300 ml
free
500 ml 1.5 L
1000 ml 2L
2.25 L

MISSION OF COCA COLA

Create consumer products, service and communications, customer
satisfaction and devise strategies, processes and tools in order to create
competitive atmosphere. To give superior value to:

 Consumer as a superior beverage experience.

 Customer as an opportunity to grow profits through the use of the

product.

 Bottlers as an opportunity to grow and volume.

 ICCC as a trademark enhancement and positive economic value.

 Suppliers as an opportunity to make reasonable profit when

added in an environment of system – side teamwork, flexible and
making continuous improvement.

 CCI associates as a superior career opportunity.

 Indian society in the form of a contribution to economic and social

environment.
OBJECTIVE OF THE STUDY

Objective of the report

 To study the distribution network.

 To study the advantages and disadvantages of the franchise of

network.

 To study the major player and their respective market shares.

 To study the consumer habits and practices.

 To know the promotional strategies being adopted.

RESEARCH METHODOLOGY
 Research Methodology

A. DEFINING THE RESEARCH PROBLEM AND RESEARCH OBJECTIVES

The definition of the problem include the study of analysis of coca cola in
the city of Jalandhar.

B. DEVELOPING RESEARCH PLAN

It has the following steps:

1. DATA SOURCES

Two types of data were taken into consideration i.e. primary data and
secondary data. But major emphasis was given on gathering primary data.
The secondary was used only to supplement the primary data and make
things clear.

a) Primary Data: The collection of data from this source includes

personal interviews of customers and staff, survey etc.

b) Secondary Data: It includes like internet , books , annual

report of the company, manuals magazine and news papers.

2. RESEARCH INSTRUMENT

The company sends every new executive for an ITMO survey. The
copy of that questionnaire has been attached.
 3. SAMPLING PLAN

a) SAMPLING UNIT: Who is to be surveyed?

The target population were the retailers of the company and of the
agencies which are employed by the company.

b) Sampling size: how many people to be surveyed?

Generally the more is to be the sampling size the more reliable is the
result. The sample size constitute of around 100 respondents.

C) Sampling Methods: The sampling methods used in the study in the

stratified sampling method further randomized sampling techniques
was selected and personal interviews were to conduct to contact the
respondents.

The company in the 80's and 90's had focussed on centralizing its operations
for enabling effective management of a vast global enterprise that was being
spread over 200 countries. It has now woken up to the fact that the world is
changing very fast today and that a localized management that can quickly
respond to the challenges and needs of the relevant market will be critical to
success, rather than a unified management at the centre. And that is precisely
what Coca-Cola has set out to do. It appears to be handing out a greater
degree of freedom and responsibility to the frontline managers in their
respective areas of operations. It has decided to cut jobs and convert itself
into a leaner structure. In India too, the complex holding structure has been
broken down and converted into a simplified structure. A single holding
company Hindustan Coca-Cola Holdings Pvt Ltd and one downstream
subsidiary - Hindustan Coca-Cola Beverages - formed by the merger of 4
bottling subsidiaries of Coca Cola and that of Schweppes now operate in
India. The parent has performed a comprehensive review of its Indian
bottling operations and has announced that it will be writing off $400mn
worth of assets in India in the first quarter of this year.

The meeting hosted last week by the company to update investors on its
business strategies and outlook for the future also sang the same tune of how
members of the global Coca-Cola management team are implementing their
"Think Local, Act Local" philosophy. The company's focus, according to
the management, will be to encourage higher consumption of non alcoholic
beverages and the Coca-Cola brands in every country. This will be achieved
through an intense focus on consumers, communities, customers, the Coca-
Cola system and Coca-Cola people. The Consumer focus strategy involves
using innovative and tailored marketing programs based on local consumer
insights to enable the company to keep growing.. "We want to ensure that we
have a tailored nonalcoholic beverage portfolio in every community that
touches consumers in locally relevant ways." states the annual Report of the
company.

IMPORTANCE OF STUDY

1. For the different strata of society and catering to the needs of different
people with the different taste the companies are provide a number of
value added benefits complying with the norms of customer oriented
market.
2 The recommendation proposed in the study can be helpful to the
companies for identifying draw backs in there existing add campaigns
and further reformulate their advertising strategies so as to result in
ameliorated market performance.

3 To me the study has provide to be a valuable experience as it provide

me with sample opportunity to acquaint my self with the market
structure and the strategies which are being followed in the highly
competitive soft drinks market.

Distribution network
 Coca cola

Company Owned Franchise Owned

Bottling Operation Bottling Operation
(COBO) (FOBO)

Plant Plant

Warehouse Warehouse

Depots Depots

There is no involvement of wholesalers in the distribution of products. It

is more like an agent network. The companies have divided the country
into various regions and established a franchisee in each region. The
franchises have their own bottling plant and manage all the day-to-day
operations. However, of late the soft drinks companies have started setting
up company owned bottling units/have been acquiring some of its
franchise bottles.
 MARKET RESEARCH

MARKET CHARACTERISTICS

The soft drink market is highly skewed in terms of place of consumption, in

terms of regional distribution and soft drinks flavors as well as in terms of
SKUs (stocks keeping units).
while 80% of the consumption is impulse based outside homes 20% comes
from consumption at home. This trend is slowly changing with increase in
occasion led sales. Changing life style increasing urbanization and impact of
liberalization has slowly and gradually started moving the market from
impulse led to occasion led and home refrigeration led consumption.
The market preference is highly regional based. While cola drinks have main
market in metro cities and northern states of UP, PUNJAB, HARYANA etc.
orange flavored drinks are popular states. Sodas too are solid largely in
southern states beside sale through bars. Western markets have presence
towards mango flavored drinks. Dite coke presently constitute just 0.7% of
the total carbonated beverage market.
In terms of SKUs thaw market is skewed towards 300ml, which constitutes
around 80-85% of the market, rest is in the form of other pack sizes. But
with increasing occasion led and home refrigeration led consumption the
sales of bigger SKUs like more than 1 liter pack sizes has increased in
contribution from pet bottle sale to 15% of the total turnover in FY00 . And
most of this PET bottle sales upto 75% are in urban areas. Another skewness
is in term of the year when the consumption takes place. Most of the sales of
the soft drinks takes place during summers while joist 5-6% of total sales
take place in winters. In summer the high season last for 70-75% days,
which contributes more than 50% of the total yearly sales.

POSITIONING AND TARGETING OF VARIOUS BRANDS:

Coke: it targets teenagers and is positioned as refreshment for mind and

body.

THUMS UP: with the punch line “grow up.”it targets people in the age
group of 18 to 30 as a things for machoism and adventure
loving person.

LIMCA: it targets to youngster and mature peoples and positioned as cool

refreshment.

MAZZA: It is a drink for everyone. Along with diet coke it is being

projected as health drinks for family and figure conscious people
specially girls.

FANTA: It is targeting as fun thing with tinkling taste in the mouth for the
peoples bellow teens.
PEPSI: As coke it targeted toward youth, while Marinda, like is a fun
loving drink. Which is position as a one, which refreshes.

SPRITE: The punch line “no gyan all taste”. It coaxes to people to follow
their instincts and avoid following or not pay any heed to false
claims of other.

MOUNTNDEW: it is targeting with the line “Do The Dew” with different
taste amongs the teenagers and youngsters.

MAJAR PLAYER AND MARKET SHARES

The two global major Pepsi and coca-cola, dominate the soft drink market in
India. Coca cola, dominate the soft drink market in India. Coca cola, which
have winded up in its India operations during the introduction of the FERA
regime, reentered India 16 years in later 1993. Coca cola acquired major
chunk of the soft drink market by buying out local brands Thums up, Limca
node Cold Spot from Parle Beverage. Coca cola has also acquired Cadbury
Schweppes soft drink brands crush , Canada Dry and Sport cola in early
1999 and in Oct ’01 it acquire distribution rights of these brands from IFB
Agro limited. Pepsi although started a couple of years before Coca cola in
1999, has a lower market share today. It has bought over Mumbai based
Duke’s range of soft drink brands. Both the Cola manufacturer come up with
own their own market share figures and claim to have increase their share.
Recently in August 01 Pepsi increased its market share for first five months
of calendar year 2001 to 49% from earlier levels of 47.3%, while Coke
claims to have increased its share in market to 57% in the same period from
55% in the corresponding period last year. Coke figure are based on ORG’s
data while that of Pepsi are based on IMRB data.

good part of the cola season is over and July-end is the time for stock taking
in the board rooms of cola majors. While Pepsi is visibly shy this year as it
refused to disclose its market share figures, Coca-Cola said it maintained its
position as the largest selling brand in India’s carbonated soft drink (CSD)
space with a market share of over 60%.

By that yardstick, Pepsi would have a market share of around 36-37% this
year. The smaller regional brands account for about 1 %. While ORG carries
out the market share survey for Coca-Cola, IMRB does it for Pepsi. They
have not yet agreed on a common market share survey for both brands.

“Our market share at the moment stands at 61%,” a Coca-Cola India official
told ET. When contacted, PepsiCo India officials refused to give out any
figures, but claimed sales have witnessed double-digit growth in terms of
value. They attributed the growth to aggressive expansion of portfolio and
cutting edge market practices.

According to a survey conducted by RSA ORG in 2004, Coca-Cola India

had a market share of 60.9% as against PepsiCo India’s share of 36%.

Commenting on the growth pattern of their brands in India over the last few
years, a Coca-Cola official said that the Sprite brand has been the fastest
growing CSD brand in the country, with its sales volumes in the first six
months of 2005 being almost equal to the full year sales of 2003.

As per the RSA ORG survey, the market share of Sprite was 12.2% as
against 7-Up’s share of 5.2% in May 2005

PEPSI VS COKE

The cola wars had become a part of global folklore - something all of us took
for granted. However, for the companies involved, it was a matter of 'fight or
succumb.' Both print and electronic media served as battlefields, with the
most bitter of the cola wars often seen in form of the comparative
advertisements.
In the early 1970s, the US soft-drinks market was on the verge of maturity,
and as the major players, Coke and Pepsi offered products that 'looked the
same and tasted the same,' substantial market share growth seemed unlikely.
However, Coke and Pepsi kept rejuvenating the market through product
modifications and pricing/promotion/distribution tactics. As the competition
was intense, the companies had to frequently implement strategic changes in
order to gain competitive advantage. The only way to do this, apart from
introducing cosmetic product innovations, was to fight it out in the
marketplace. This modus operandi was followed in the Indian markets as
well with Coke and Pepsi resorting to more innovative tactics to generate
consumer interest.

In essence, the companies were trying to increase the whole market pie, as
the market-shares war seemed to get nowhere. This was because both the
companies came out with contradictory market share figures as per surveys
conducted by their respective agencies - ORG (Coke) and IMRB (Pepsi). For
instance, in August 2000, Pepsi claimed to have increased its market share
for the first five months of calendar year 2000 to 49% from 47.3%, while
Coke claimed to have increased its share in the market to 57%, in the same
period, from 55%.

Media reports claimed that the rivalry between Coke and Pepsi had ceased to
generate sustained public interest, as it used to in the initial years of the cola
brawls worldwide. They added that it was all just a lot of noise to hardsell a
product that had no inherent merit.

THE PLAYERS

Coke had entered the Indian soft drinks market way back in the 1970s. The
company was the market leader till 1977, when it had to exit the country
following policy changes regarding MNCs operating in India. Over the next
few years, a host of local brands emerged such as Campa Cola, Thumps Up,
Gold Spot and Limca etc. However, with the entry of Pepsi and Coke in the
1990s, almost the entire market went under their control.
Making billions from selling carbonated/colored/sweetened water for over
100 years, Coke and Pepsi had emerged as truly global brands. Coke was
born 11 years before Pepsi in 1887 and, a century later it still maintained its
lead in the global cola market. Pepsi, having always been number two, kept
trying harder and harder to beat Coke at its own game. In this never-ending
duel, there was always a new battlefront opening up somewhere. In India the
battle was more intense, as India was one of the very few areas where Pepsi
was the leader in the cola segment. Coke re-entered India in 1993 and soon
entered into a deal with Parle, which had a 60% market share in the soft
drinks segment with its brands Limca, Thums Up and Gold Spot. Following
this, Coke turned into the absolute market leader overnight. The company
also acquired Cadbury Schweppes' soft drink brands Crush, Canada Dry and
Sport Cola in early 1999.

GRAPHICAL REPRESENTATION OF MARKET SHARE (IN %) OF

COKE AND PEPSI:

Brand Name Market share (in %)

Coca cola 57

Pepsi 41

Other 2
 market share in (%)

1%
38% cocacola
Pepsi
61% Others
RELATIVE SHARE OF EACH PRODUCT (COCA COLA)
IN THE PRODUCTION TOTAL

The coca cola flavour dominates the total share of production volume, the
second highest contributor the total volume being fanta, limca , sprite being
the lowest. The most insignificant share is that of sprtite soda and kinley
water.

COKE FLAVOURS % SHARE IN TOTAL

PRODUCTION
COKE 50
FANTA 10
LIMCA 22
SPRITE 2
MAAZA 8
SODA 4
KINLEY WATER 4

% SHARE IN TOTAL PRODUCTION

COKE
8% 4% 4% FANTA
2% LIMCA
SPRITE
50%
22% MAAZA
10% SODA
KINLEY WATER

Season –wise sale

The months of Apr-June constitute the peak period of highest sale during the
year, amounting approximately to 45% of the total sale volume. On the
contrary the months of October and December have relatively a lower
percentage in total sale volume, amounting to only 13%. The period of
January-march shows a gradual increase in the sale volume.

MONTH PERCENTAGE SALE

APR-JUNE 45
JUL-SEP 26
OCT-DEC 13
JAN-MAR 16

PERCENTAGE SALE

16%
APR-JUNE
13% 45% JUL-SEP
OCT-DEC
JAN-MAR
26%

SIX MONTH REPORT CHART OF COCA COLA COMPANY

Chart(s) drawn 23 Aug 05
 ABOUT LUDHIANA BEVERAGE LIMITED

ABOUT LUDHIANA BEVERAGE LIMITED

“Ludhiana Beverage Limitd” previously known as “Ludhiana Bottling

Company” was established in 1966 in textile colony Ludhiana by joint
efforts of Mr. Kalish Goenka, and Mr. Radhae Shayam Podar. This plant
was the first franchise of Parle in Punjab. The plant started its operation with
a 66BPM funky line with a single prime product “Gold Spot” at that time
annual production was only 3.35 lacks cases. Sales were 2.7 lacks cases and
turn was 27 lacks. Distribution was done with the help of 8 vehicles (6 three
wheeler and 2 truck).
The plant shifted to its new venue “185 G.T. Road ,Ludhiana” in 1972
with the introduction of new machinery (CEM) from America, production
capacity was increased to132 BPM. In 1973, Limca and in 1977 Thums Up
were introduced with exit of coke from India. In 1988, RTs Maaza was
introduced. Yearly production was increased to 7 Lacks cases and sale to 6.5
lacks 12 more vehicles for added for distribution with a total of 20 vehicles
(14 Three wheeler, 6 Trucks).
Ludhiana Bottling Company got the gold medal for best Quality in
India and Silver medal in sales.
In 1994, the Legend and Soft drink against Coca-Cola took over Parly
and LBL was the third Franchisee of coca-cola In Punjab. With the
introduction of new technology in plant and implementation polices of the
Coca –Cola system, LBL has along way in proving a name of
itself. It has a600 BPM aerated line three-wheeler and 11fork lifers.
Production is 4.3 million year with 30,000 C/S per day during peak season.
Sale is 4.2 million c/s with a turn over of 50 crores. LBL is rising with leaps
and bounds and extending its empire by making available its product to rural
population and is the second plant in India with maximum sale volume and
excellence its quality. It is graded no one plant by Coca-cola India which is
utilizing its resources to its maximum with minimum wastage. It is the one
among those plants, which have already progressed into the third phase.

List of various product manufacture in LBL:

Aerated Product: Coca-Cola, Thums Up, Limca, Fanta, Kinely Soda
Non-Aerated Products: Maaza

Various departments in LBL:

1. Production
a) Water treatment sections
b) Raw/ready syrup section
c) Carbon dioxide section
d) Concentrate section
e) Refrigeration section
f) Boiler section
g) Power house
h) ETP
2. Quality Assurance
3. Stores
4. Ware house/ shipping
5. Distribution
6. sales and marketing
7. finance
8. HRD
YEAR PRODUCTION (MN BOTTLES)
88-89 1968
89-90 2070
90-91 2195
91-92 2490
92-93 2800
93-94 3000
94-95 3240
95-96 4000
96-97 4450
97-98 4920
98-99 5690
99-2000 6480
2000-2001 7000

PR OD U C TIO N (MN BO TTLES)

7000
6000
5000
4000
3000 PR OD U C TION
2000 (MN BO TTLES)
1000
0
88-8991-9294-9597-982000-
2001
 ORGANIZATION STRUCTURE OF L.B.L

MANAGING DIRECTOR
(Mr. K.K Goenka)

G.M marketing Chief Executive Vice President

Area Area Purchase Time Comm .mgr Excise

Distri
sale Mgr office
sale sale bution
mgr Depot
mgr mgr A/c Officer
Purchaser
Excise
Assistant

Depot I/C Depot I/C

REPORT ON OPERATION TRANING:

Bottler Ludhiana Beverage Ltd.

Key information’

1. Population ----100 Lakhs

2. IBI ----353
3. PCC ----20
4. No. of outlets ----22,000
5. new outlet ----2000
6. Total Outlets ----24,000
7. VPO ----328
8. Market Share ----75%
9. No. of production Lines ----3
10.Production capacity ----600-440 (Maaza)

DISTRIBUTION NETWORK

No. of New No. of No. of Empties Population IBI PC

outlets outlets routs vehicles in the
market
Distt. 4954 400 134 160 80000 1850000 313 14
Distt. 5925 1300 37 15 40000 6100000 885 8
Local
Jalandhar 2073 300 20 20 32000 600000 216 27
city
Ludhiana 3285 500 41 44 80000 1250000 330 22
city
Total 16237 2500 232 239 23200 9800000 523 14
0

Distributor in Ludhiana City:

 1. Ragav Trader I – C 54, Focal Point
2. Ragav Trader II- Bhadour House
3. Ragav Trader III- Near Arti Cinema (non functional)
4. Ragav Trader IV- Sahnewal Depot

The distributors in Jalandhar City are

1. Ludhiana Bottling Company.

2. Azad trading company.

Beside there are agent in different distt.

For the district local there are 3 modes of supply

1. Dumps
2. Direct Load
3. Rout Sale
CHANNEL OF DISTRIBUTION LUDHIANA BEVERAGE LTD.

Plant LBL SAHNEWL

DEPOT
DIST.DUMP
C-54FOCAL City
POINT Sale

JALANDHAR
DEPOT

Re-distribution
Distt. Local Rout

The soft drinks once bottled are sent to either of the following from the
bottling plant.
1. Company Depots
2. Agencies
Thos is called PRIMARY SALE

1.DEPOT SALE

Another form of primary sale is form the bottling plant to various depots
within DKDBL owns four depots located at:

SAHNEWAL
LUDHIANA
JALANDHAR
These depots are run by the company, and are backed by a fleet of vehicles
to play on various routs within the LBL franchise region. This form of is
hence fully undertaken by LBL its own depots, and its own transportation,
usually, LCV. Depot sale takes place within various cities, and also covers
outer city routes(rular routs). Depot sale is very impoetant from the fact that
it constitutes the majority of rural sale.

3. AGENCY SALE

The third form of primary sale takes place from the bottling plant to various
agencies located throughout the franchise region.
The agencies usually operate in smaller cities, the larger cities being taken
care of by C/F agent of company depots. A particular agency may operate its
own LCV routes, this is called a indirect route, a direct rout being one which
is operate by the company LBL rout may be mechanized and non-
mechanized.
A mechanized rout is one, which is backed by the support and funds from
LBL. It is given a boost in three form of capital and marketing input from
LBL. Non-mechanized routs on the other hand are wholly run and operated
by agencies with marketing input support provided by LBL.
ADVANTAGES AND LIMITATION OF FRANCHISEE NETWORK

Advantages are:

 Reduce investment level in manufacturing equipments:

If a company sources its product from franchisees, it does not require setting
up its own manufacturing plant for purpose. The company thus benefits from
reduced investment in manufacturing facilities, inventories of raw material
and other function required for the components.

 Saving on management time:

As the components are out sourced the company stands to again by saving
on the management time and cost. The role of the company get restricted to
establishing the system and in quality control at the franchise locations. Over
a period of time the system implemented stabiles and hence the involvement
of company remains on at the strategic decision level.
 Reduced interfacing and dealing with labor
The labor and union employee involved in the manufacturing are the
responsibility of the franchisee. This is beneficial as it reduced the
management time and involvement in solving there issues.
Limitations are:

 Large volumes
To set up an ancillary bases the company is require to produce large volume
as the franchisees may not be interesting in making large investment in the
manufacturing facilities if the volume require to be produced are low.
Especially the existing franchisees will not take the risk of tying up with new
players.

 Financial support
In India, most vendor are small in size and do not have the capital to invest
in these equipments, which requires the manufacturers to give the financial
support. This problem becomes intense when the manufacturer has an
existing franchisee base and want to increase the capacity.

 Quality
In some cases, due to cost consideration, the manufacturer are forced to
compromise on quality.
 Consumer habits and practices

• Soft drink come under the category of product, which are purchase on
impulse. Through the market is marred by brand loyalty the purchase
decision itself is a low involvement decision. This attitude of impulse
buying is slowly changed to occasion led buying and also to some
extent to consumption through home refrigeration particularly in
urban areas.
• The market is slowly moving from non alcoholic carbonated drinks to
fruit based drinks and also to plain bottled water due to lower price
and ready availability.
• Consumers purchase soft drinks primarily quench thirst. Therefore
people traveling and having access to hygienic water reach out for soft
drinks. This accounts for a large part of the sale.
• Brand awareness plays a crucial role in purchasing decision.
• Consumer prefer convenient and economy product’s.
• Availability in the chilled from affects the purchase decision. This has
made both the companies to push it sales and to increase its retail
distribution by offering Visi cooler to retailers.
• While there is no aversion to consumption of soft drinks by any age
group, the main consumer of this market are people in the age group
of 30 and below.
• Product differentiations is very low, as all the product taste same. But
brand loyalty is high in the case of kids people in the age group.
• Consumer are sensitive to the outlay where the purchase of beverages
is concerned. Hence the market is price sensitive.

• Due to high cost of soft drinks, a lot of times consumers prefer

beverage like tea, coffee or other drinks like sherbet and squashes.
• Health conscious people avoid cold drinks owing to its calorie content.
• Strategic location of cold drinks outlets plays important role in
purchasing decision.
• Young consumer chose there brands depending there own sell image
and social standing as being projected by a particular brand.
• Per capita consumption in India is among lowest in the world at 5
bottle per annum compare to 80 bottles in Thailand and 800 bottle on
USA.
 • Delhi market has highest per capita consumption in the country with
the 50 bottles per annum compare to 5 bottles for the country.
• While 75% of the PET bottle consumption in urban areas the 200ml
bottles sale are higher in ruler area.

According to NCAER lower, lower middle and upper middle class people
do survey 91%of the total consumption of soft drinks in the country.

RETAILERS PERCEPTION

A survey was conducted to study the retailer’s view of the present market,
future trend and the consumer behavior patterns. The finding of the survey
are as follows:
• Retailer stated that the consumers are loyal to the particular segment
of soft drink i.e. cola, orange or lemon. Be as far the loyalty for the
brands in each segment are concerned, it is not very significant.
• 43% of the retailer survey told soft drink advertising is the key
component in driving sales. While 32% stated promotional schemes
and 20% brand loyalty as the reason.
• As consumer are not very brand loyal where the purchase of soft
drinks is concerned, the retailers push become critical issue. They
usually sell the product in which them higher margins.

While distributor get margins of Rs. 8-9 per carat (1 crate= 24 bottles) at 3-
4 of MRP few retailers are given a margin of 3-10% of MRP. The retailer are
not happy with this, as the cost of refrigeration is very high for soft drinks.
To cover come this problem the companies are offering visi-coolers schemes
to their main retailers.
 SWOT ANALYSIS]

In swot analysis we look into the strengths weaknesses, opportunities, threats

to company. The first two are related to internal environment and the second
two are related to external environment.

Strengths

1. Franchise of multinational company global market

2. Strong and penetrative distribution channel.
3. Good brand positioning of coca cola.
4. Strong financial position of the company.
5. Regular advertisement in print media as well as in television.
6. There is no strong brand to replace Limca.
7. Very dedicated and professional staff.

Weakness

1. Fewer benefits provided to the outlets as compared to the rival

company Pepsi.
2. The work of publicity is slow and a lot of work is pending.
3. Lack of quick responsiveness to the problems of retail.
4. Visi coolers are not of high quality.
5. Poor maintenance irks the retailers.
Opportunities

1. The launch of new products has opened new avenues to increase the
market share and thereby increase the profits.
2. At present the company has franchise rights of 7 territories of Punjab
which might increases in the near future.
3. Introduction of fruit juices for the health conscious people has opened
up anew market for accompany to cater.

Threats

1. Cut throat completion from the rival company Pepsi.

2. Customer are loyal to brand.
3. Change in Government might harm the future of the company.
4. People are becoming increasingly the health conscious.
5. The local brand like Top cola fun, etc. are very cheap as compared to
Coca-cola and are eating into its share.
 Limitations

Person trying to undergo training in unknown field they don’t know the
opportunities, facilities that are waiting for them and substitute available for
them, ultimately they suffer a lot for this initial ignorance.

1. Area of study chosen was not large.

2. Time available was very short.
3. Limitation of judgment sampling and convenience have into the study.
4. Misleading information by respondent can’t be neglected.
5. Hard task to ascertain information from uneducated conclusion on
account of the limitation of the tools and technique involve in there.
6. Some customer problem don’t, lead to a valid research conclusion on
account of the limitation of the tools and technique involve in there.
7. in the fast changing world the data collected soon become historic and
research finding based on them irrelevant.
8. It only provide a base for predicting future events, it can’t guarantee
with certainty their shape or happening.
 ANALYSIS AND INTERPRETATION

Q.1Which company’s product you deal with?

Coca cola Pepsi Both Local

70% 15% 12% 3%

dealing with different soft drink

companies

80%

60%

40%

20%

0%
Coca cola Pepsi Both Local
Interpretation the shown in table clearly shows the supremacy of coca cola
over Pepsi. Fig shows that 70%retailer deal with coca cola , 12% retailer
deal with Pepsi and 12% both & 5% retailer use local brands.

Q2. which class of consumer in your shop?

Rich class 10%

Upper class 15%
Upper middle 12%
Middle class 25%
Lower middle 20%
Lower class 18%

Rich class
18% 10% Upper class
15% Upper middle
20% 12% Middle class
25% Lower middle
Lower class

Interpretation: The date shown in table represent that in rural area there is
less percentage of rich class. There is more percentage of lower m ziddle
class and upper middle class. So we should target on lower middle and
middle class
Q.3. do you Sell 200ml coke, if no why?

Yes 35%
No 65%
Interpretation: it is clear from table that retailer do not prefer 200ml. Coke.

Trade scheme are less 30%

Money change problem 50%
People don’t prefer 15%
Anyother 5%

REASON FOR LESS SALE

5% Trade scheme
15% are less
30%
Money change
problem
People don’t
prefer
Any other
50%

I
nterpretation: The retailer are facing the problem regarding 200ml sale of the
coke. And many retailer told that trade scheme are less as com pare to Pepsi.
Q.4 Do you sell 1 liter coke if ‘No’ why?

Yes 30%
No 70%

Interpretation: sale of 1lt. Coke is less.

Trade scheme are less 20%

Empty glass problem 60%
Any other 5%
 70%
60%
50%
40%
S eries 1
30% 60%
20%
10% 20%
0% 5%
Trade E m pty A ny other
s c hem e glas s
are les s problem

Q.5. Are you satisfied with the distributor of coca cola?

Yes 80%
No 20%

Satisfaction with distributors

 20%

1
2

80%

Interpretation: 80% of retailer are satisfied with the distributors and 20 %

retailer are not satisfied.

Q.6 .Are you satisfied with the supply of 200ml,300ml, 500+100ml, 1

liter & 2 liter coke?

Yes 80%
No 20%
 20%

1
2

80%

Interpertation: most of the retailer satisfied with the supply of 200 ml,
300ml, 500+100ml, 1 lt, & 2 lt. Only 20% are not satisfied.

Q .7. what is the age group that prefer coke?

Age group Percentage

10-20 60%
20-30 20%
30-40 10%
ore tMhan 5%
40
 Percentage

60% 60%
50%
40%
30%
20% 20%
10% 10% 5% Percentage
0%
okt.20 30-40

Interpretation: It is clear from the data that 60% of the people that prefer to
drink coke between age group 10-20. 20% between age group 20-30, 10%
between age group 30-40 &5% more than 40 age group.

Q.8. Availability of coke and Pepsi?

Coke 65%
Pepsi 35%
 0,7 65%
0,6
0,5
0,4 35% coke
0,3 Pepsi
0,2
0,1 0
0
1 2 3

Interpretation: The availability of Coke on the market is more than the

availability of Pepsi. The availability of coke is 65% and availability of
Pepsi is 35%. Coke is easily available in the market.

Q. 9. availability of 200ml, 300ml, 500+100ml of coke?

200ml 300ml 500+100ml

Coke 70% 75% 60%
Pepsi 30% 25% 40%
 Coke

60% 70% 200ml

300ml
500+100ml
75%

Pepsi

200ml
30%
40% 300ml
500+100ml
25%

Q.10. Availability of 1 liter & 2 liter of Coke and Pepsi?

1 liter 2 liter
Coke 55% 60%
Pepsi 45% 40%

Interpretation: All the brands of coca cola are available more in the market
than Pepsi. We can say that the Coca cola brands are easily available in the
market.
 Coke

55% 1 liter
60% 2 liter

Pepsi

40% 1 liter
45% 2 liter

Q. 11. Do you think that the selling price of 200ml of coke at Rs. 6
Reasonable? If ‘NO’ why?

Yes 25%
No 75%

Interpretation: 80% of the retailer think that the price of 200ml Rs 6/- is not
reasonable.
Money change problem 50%
Less profitability 40%
Any other reason 10%
Reasonability of Price

re a s o n a b ilit y o f p ric e

60% 50%
50% 40%
40% re a s o n a b ility o f
30%
20% 10% p ric e
10%
0%
problem
change
Money

Any other
profitability

reason
Less

Interpretation: 90% retailer says that there is less less profitability and
money change problem. And 10% of retailer says that supply is not
sufficient & some says that people don’t prefer.

Q.12. Do you think the change in price will increase the sale of coca
cola?

Yes 80%
No 20%

Willingness to change of price

 W illingnes s to c hange pric e

80%
60%
40% W illingnes s to
c hange pric e
20%
0%
Y es No

Interpretation: Most of the retailer said that if the price is change then the
sale of coke increase.
 RECOMMENDATIONS

Recommendation

1. Coca cola tries to lay stress on the facts that price is going to play an
important role in the success of cocoa cola as a product in the Indian
market, hence it should be effectively priced. It should be pieced
keeping in mind the prices of other drink cans.

2. Coca Cola should lay emphasis on giving more incentives to the

retailer and should provide case or other discount to the retailers.

3. Coca cola should take note of the fact that there are still many people
who have not tasted Coca cola as yet so should provide certain scheme
to the customers to that they can be lured into making such purchases.

4. Coca cola should further provide the retailer with more publicity
material such as dangler’s, Posters, Cutout and thing like certain free
gifts should be given to consumers.

5. Coca cola should also ensure that it constantly beams television and
print media advertisement constantly and at the same time also run
certain sale promotion schemes so as to increase the sales.

6. More and more steps should be taken to improve the distribution

network of LBL and regular supply.

7. The retailer problem and complaints should be meet at the earliest so

to maintain trust and loyalty towards company.
8. Special promotional schemes for the fruit juice like the Frooti packs
should be undertaken as they have a potential market.

BIBLOGRAPHY
• Cocacola.com

• Annual report of coca cola

• Marketing management – Philip Kotler

• Cocacolandia.com

• Value notes

• Business world

QUESTIONER FOR RETAILER

Q.1Which company’s product you deal with?

Coca cola Pepsi Both Local

Q2. which class of consumer in your shop?

Rich class
Upper class
Upper middle
Middle class
Lower middle
Lower class

Q.3. do you Sell 200ml coke, if no why?

Yes
No

Q.4 Do you sell 1 liter coke if ‘No’ why?

Yes
No

Q.5. Are you satisfied with the distributor of coca cola?

Yes 80%
No 20%

Q. 6. Are you satisfied with the supply of 200ml,300ml, 500+100ml, 1

liter & 2 liter coke?

Yes 80%
No 20%

Q .7. what is the age group that prefer coke?

Age group Percentage

10-20
20-30
30-40
More than 40

Q.8. Availability of coke and Pepsi?

Coke
Pepsi

Q. 9. availability of 200ml, 300ml, 500+100ml of coke?

200ml 300ml 500+100ml

Coke
Pepsi

Q.10. Availability of 1 liter & 2 liter of Coke and Pepsi?

 1 liter 2 liter
Coke
Pepsi

Q. 11. Do you think that the selling price of 200ml of coke at Rs. 6
Reasonable? If ‘NO’ why?

Yes
No

Q.12. Do you think the change in price will increase the sale of coca
cola?

Yes
No