pepsi distribution channel
TRANSCRIPT
DISTRIBUTION CHANNEL
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
PepsiHYDRATING AND NUTRITIONAL BEVERAGES
Aquafina
ISOTONIC SPORTS DRINKS Gatorade
JUICE BASED DRINKS Tropicana 100%, Tropicana Nectars, Tropicana Twisters and Slice
LOCAL BRANDS Lehar Evervess Soda and Dukes Lemonade
PEPSI
DISTRIBUTORS
BOTTLERS
RETAILERS
WAREHOUSES
RETAILERS
RETAILERS
WHOLESALERWAREHOUSES
Paym
ent
Chilled DSD
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 Pepsi is ubiquitous.
• Number Of IntermediariesIntensive Distribution: Pepsi Co follows an
intensive distribution strategy. To support their ubiquitous feature they want to place their product in as many outlets as possible.
Increases market coverageCompeting against Coca Cola and other local
companies.
• Terms And ResponsibilitiesPrice Policy:
Distributors: 3 to 5 % is the profit marginRetailers: 10 % to 16 % is the profit margin
Territorial Rights: Distributors are given territorial rights and are not allowed to work beyond their territories.
Conditions of Sale: Payment done through bank or cash. Option of credit sales remains at the lower part of the chain. Guarantee of damaged goods provided.
MARKETING SYSTEMSHORIZONTAL
MARKETING SYSTEMVERTICAL
MARKETING SYSTEM
Pepsi – Lipton Alliance Pepsi - Bottler
CHANNEL MEMBERS AND ROLES
• PepsiCo – Assigns a territory to the distributor.– Assigns sales target acc to region and seasons.– Evaluates performance against predefined parameters.– Sales incentives– Promotional offers.
• Distributors• Wholesalers• Retailers
INTERMEDIARY STATISTICSDISTRIBUTORS
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
EVALUATION
Contd…• KEY PARAMETERS
Total lines sold per dayAverage of SKU per orderPenetration % No. of SKU salesOutlet booking orderCompleted sales
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
By: Akhil Gupta (91064)
Ambreen Fatma (91066)Subhrajit Dutt (91112)