pepsi co supply chain

7/30/2019 Pepsi co supply chain

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Presentation on

DISTRIBUTION CHANNEL OF PEPSI

Presented by:

Sanghamitra Kalita

Sayantani Saha

Vinay Guwalani



What is distribution channel?

• The chain of businesses or intermediaries

through which a good or service passes until it

reaches the end consumer.

• A distribution channel can include

wholesalers, retailers, distributors and even

the internet.



Importance of distribution channel



Types of distribution channel

Channels are broken into :

• Direct (centralized): with a "direct" channel

allowing the consumer to buy the good from

the manufacturer

• Indirect (decentralized): "indirect" channel

allows the consumer to buy the good from a

retailer.



Direct distribution channel

• The producer sells the product directly without involvementof any middle man.

• The sale can be made door to door through salesman, retail

stores and direct mail.

• Certain industrial and consumer goods such as clothes, shoes,books, hosiery goods, cosmetics, household appliances,

electronic goods etc., may be sold through direct contact.

• Perishable goods such as vegetable and fruits can also be solddirectly.



Advantages & disadvantages of direct

channel:•

Advantage of selling through direct channels • It is simple and fast.

• It is economical.

• The producer has full control over distribution.

•

Satisfies the desire to reduce dependence on middlemen.

• Cash sales.

•

Disadvantages of selling through direct channels • Non-availability of expert services of middle man.

• Large investment is required.

• Unsuitable for small producers.



Pepsi: introduction

• PepsiCo is a USA based company having its

head quarters at New York with the net worth

of $30-40 million.

• The average sales of the company are approx

90 million bottles per month.

• Within 32 years Pepsi emerged as the biggest

competitor for Coca Cola. Pepsi is available in

155 countries.



PEPSI CO.

• Entered India in 1989

• One of the largest multinational investors

• Provides direct and indirect employment 1,50,000

people (including suppliers and distributors)

BEVERAGES Pepsi, 7UP, Mirinda, Mt. Dew and Diet

Pepsi

HYDRATING AND NUTRITIONAL

BEVERAGES

Aquafina

ISOTONIC SPORTS DRINKS Gatorade

JUICE BASED DRINKS Tropicana 100%, Tropicana Nectars,

Tropicana Twisters and Slice

LOCAL BRANDSLehar Evervess Soda and Dukes

Lemonade



PEPSI

DISTRIBUTORS

BOTTLERS

RETAILERS

WAREHOUSES

RETAILERS

RETAILERS

WHOLESALERWAREHOUSES



Manufacturer Sponsored Retail

Franchisee

• Pepsi Co licenses bottlers in various markets

that buy its syrup concentrate.

• These bottlers then carbonate and bottle the

syrup to sell them to distributors or retailer



FACTORS FOR CHANNEL DESIGN

•

Customer NeedsAssortment of Goods: Pepsi has a wide

assortment of goods. In beverages some very

famous are Pepsi Mirinda, 7up, Slice etc Aquafina,

Lehar Soda also.

Ubiquitous: Restaurant, Pan shops, Kirana Stores,

Confectionaries, Pepsi on wheels, all these are

some examples of the fact that the product Pepsiis ubiquitous.



• Number Of Intermediaries

Intensive Distribution: Pepsi Co follows an

intensive distribution strategy. To support theirubiquitous feature they want to place their

product in as many outlets as possible.

Increases market coverageCompeting against Coca Cola and other local

companies.



CHANNEL MEMBERS AND ROLES

• PepsiCo – Assigns a territory to the distributor.

– Assigns sales target acc to region and seasons.

– Evaluates performance against predefinedparameters.

– Sales incentives

– Promotional offers.

• Distributors

• Wholesalers

• Retailers



INTERMEDIARY STATISTICS

DISTRIBUTORS

Jain distributors - Munirka, New Delhi Manages buffer for 10 days and

uses TALLY and EXCEL software

SS drinks Private Limited -do-

WHOLESALERS

EKTA Wholesalers Private Limited Manages buffer for 2-3 days and

uses EXCEL software

RETAIL

Amit Corner, Katwaria Sarai

Transportation cost , vehicle cost at each

stage is borne by each intermediaries



GENERIC CHANNEL OUTPUTS

•

Spatial convenience – High availability

– Strong presence

• Shorter delivery span (time)



CHANNEL MANAGEMENT

•

PepsiCo has lot of control over the channel – In case of Pepsi to Authorised distributor to retail

shops (defined territory of distributor)

– Pepsi assigns a particular territory to the

distributor under an agreement.

– No intervention into other’s territory without

company’s knowledge.

–Retailers accountable to the authorized

distributors



CONFLICTS• Hybrid Channel in place - Wholesalers do not

have a control over retailers

• Rigidity from franchisees.

SUGGESTIONS

• Install Vending machines for direct

distribution.• Financial support to the franchisees.



THANK YOU

pepsi co supply chain

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