DARE FOR MORE!

1
Table of Contents

1. History of Pepsi Cola

2. Formation of Pepsi Cola Corporation
3. Reformulation of Pepsi Cola syrup formula
4. Formation of Pepsi Cola incorporation
5. Setup of Pepsi Cola
6. Pepsi Cola Multan
7. Mission of Company
8. Slogans through time
9. Major Competitors
10. Coca Cola Mission Statement
11. Coca Cola Objective
12. Pepsi Today
13. Business Envoronment
14. Marketing Mix
15. Strategic Marketing
16. Organizational Culture
17. How new employees learn culture in Shamim & Co.
18. Reasons of popularity of Pepsi Cola in Pakistan
19. Consumer Requirement
20. Market segmentation & Target Marketing
21. Pepsi Cola Products
22. Pepsi Cola Ingredients
23. Pepsi Cola brand list
24. Future Planning
25. Latest Market share statistics
26. Shamim & Co Pvt Ltd
27. Organization Hierarchy
28. Distribution Channels
29. 8 steps of Pepsi Cola Sales
30. Swot Analysis

DARE FOR MORE!

31. Competitive Priorities
32. Decision Making in Shamim & Co
33. Organization Structure
34. Shamim & Co Departments
35. Administration Department
36. Sales/Marketing Department
37. Finance Department
38. Human Resource Department
39. Production Department
40. Shipping Department

2
41. MIS Department
42. Cash Department
43. Accounts Department
44. Excise Department
45. Post Mix Department
46. Inventory Management
47. Supply Chain Department
48. Capacity. Location & Layouts
49. Forecasting
50. Material Requirement Planning
51. Quality Control
52. Problems
53. Recommendations for Company

DARE FOR MORE!

3
 INTRODUCTION

HISTORY OF PEPSI COLA

In 1893 Caleb Bradham, a young pharmacist from New Bern, North Carolina, begins
experimenting with many different soft drinks. In 1898, one of Caleb's formulations,
known as "Brad's Drink" a combination of carbonated water, sugar, vanilla, rare oils and
cola nuts, is renamed "Pepsi-Cola". On August 28, 1898, Pepsi-Cola received its first logo.
In 1902, he applied for a trademark with the U.S. Patent Office, Washington D.C., and
formed the first Pepsi-Cola Company. 1905, Pepsi-Cola's first bottling franchises were
established in Charlotte and Durham, North Carolina. In 1906, Pepsi gets another logo
change, the third in eight years. The modified script logo is created with the slogan, "The
Original Pure Food Drink". In 1920, Pepsi theme line speaks to the consumer with
"Drink Pepsi-Cola, it will satisfy you". In 1923, Pepsi-Cola Company was declared
bankrupt and its assets were sold to a North Carolina concern, Craven Holding Corporation,
for $30,000.

FORMATION OF PEPSI COLA CORPORATION

Roy C. Megargel, a Wall Street broker, bought the Pepsi trademark, business and good will
from Craven Holding Corporation for $35,000, forming the Pepsi-Cola Corporation. In
1928, after five continuous losing years, Megargel reorganized his company as the National
Pepsi-Cola Company. In 1931, U.S. District Court for Eastern District Virginia declared
the National Pepsi-Cola Company bankrupt, the second bankruptcy in Pepsi-Cola history.

DARE FOR MORE!

REFORMULATION OF PEPSI COLA’S SYRUP FORMULA
The Loft candy company acquired the National Pepsi-Cola Company. Charles G. Guth,
president of Loft, assumed leadership of Pepsi and commanded the reformulation of Pepsi-
Cola syrup formula.1934 was a landmark year for Pepsi-Cola. The drink was a hit and to
attract even more sales, the company began selling its 12-ounce drink for five

4
cents (the same cost as six ounces of competitive colas). The 12-ounce bottle debuted in
Baltimore, where it was an instant success. The cost savings proved irresistible to
Depression-worn Americans and sales skyrocket nationally. In 1941, The New York Stock
Exchange traded Pepsi's stock for the first time. In 1964, Diet Pepsi, America's first
national diet soft drink, debuted. Pepsi-Cola acquired Mountain Dew from the Tip
Corporation in 1964.

FORMATION OF PEPSI COLA INCORPORATION

In 1965, Expansion outside the soft drink industry began. Frito-Lay of Dallas, Texas, and
Pepsi-Cola merged, forming PepsiCo, Inc. Pepsi Cola Company operates in beverages
industry. Pepsi Cola international is well reputed multinational company which is doing its
business in almost every country of the world. The company is registered in New York
stock exchange U.S.A. to make a better control over the business the company has given
the manufacturing rights to different companies. Now these companies are producing the
products on the behalf of the company by using company’s trademark. To maintain their
goodwill in the market the company has a strict policy of granting manufacturing rights.
Pepsi Cola have standardized products all over the world (e.g. same in size, shape and
quality). The franchises have to follow all the standards given by the company.

DARE FOR MORE!

5
SETUP OF PEPSI COLA

The head office is situated in New York (USA) with units

operating in different regions of the world. These are called
Business Units and Pakistan is in MENAPak (Middle East, North
America and Pakistan). The head office of MENAPak is situated
in Dubai (UAE). The local head offices for each country are
situated in the respective capitals.

DARE FOR MORE!

PEPSI COLA MULTAN
Pepsi Multan was incorporated in 1963 but it started its production in 1967. Allah Nawaz
Khan Tareen (Ret. DIG) got license of 7-UP. But in 1973, it became Pepsi Cola franchise.
Now a day MD of Pepsi Cola Multan is Alamgeer Khan Tareen son of Allah Nawaz Khan
Tareen. At start Pepsi Multan was having only one production plant made

6
by Netherlands. and was only producing 7-Up because it was the only brand produced by
Parent Company. In 1973, PEPSI acquired 7-Up in Canada so the Multan franchise started
producing PEPSI and Marinda along with 7-Up & became PEPSI franchise.
Coke was already operating in the market at the time when Pepsi Multan established. At
that time Coke was market leader but with the passage of time Pepsi Multan kept on
focusing on gaining the market share. Recently Pepsi has launched a new brand with the
name of Mountain Dew. Now Pepsi Multan is working with five production plants capable
of producing 100,000 cases per day. Installation arrangements for two new plants are in
process. The plant which was installed at the time of establishment has now been grounded.
Pepsi Multan is currently market leader with more than 80% of market share.
The company is properly serving all these areas with quality products. PEPSI Multan is not
an ISO certified company because it is an international drink having their own standards
and there is no export.

MISSION OF COMAPNY
“We aspire to make Pepsi Company the world’s premier consumer Products
Company, focused on convenient beverages. We seek to produce healthy financial
rewards for investors as we provide opportunities for growth and enrichment to our
employees, our business partners and the communities in which we operate. And in
everything we do, we strive to act with honesty, openness, fairness and integrity”

Slogans through Time

Pepsi-Cola has different slogans through its history. They remained much known. These

DARE FOR MORE!

are given below. This is also an important part of Pepsi-Cola.

1898 Brad's Drink

1903 Exhilarating, Invigorating, Aids Digestion

7
 1906 Original Pure Food Drink
1908 Delicious and Healthful
1915 For All Thirsts - Pepsi: Cola
1919 Pepsi: Cola - It makes you Scintillate
1920 Drink Pepsi: Cola - It Will Satisfy You
1928 Peps You Up!
1929 Here's Health!
1932 Sparkling, Delicious
1933 It's the Best Cola Drink
Double Size
1934
Refreshing and Healthful
1938 Join the Swing to Pepsi
1939 Twice as Much for a Nickel

1943 Bigger Drink, Better Taste

1947 It's a Great American Custom

1949 Why Take Less When Pepsi's Best?
1950 More Bounce to the Ounce
The Light Refreshment
1954
Refreshing Without Filling
1958 Be Sociable, Have a Pepsi
1961 Now It's Pepsi for Those Who Think Young
1963 Come Alive! You're in the Pepsi Generation
1967 Taste that Beats the Others Cold, Pepsi Pours It On.

1969 You've Got a Lot to Live, Pepsi's Got a Lot to Give

1973 Join the Pepsi People Feeling' Free

1976 Have a Pepsi Day!
Catch That Pepsi Spirit
1979
Take the Pepsi Challenge
1981 Pepsi's Got Your Taste for Life
Pepsi Now!
1983

DARE FOR MORE!

1984
1987
1989
The Choice of a New Generation
America's Choice
A Generation Ahead
1992 Gotta Have It
1993 Be Young, Have Fun, Drink Pepsi
1995 Nothing Else is a Pepsi

1997 Generation Next

8
 1998 Same Great Taste
1999 The Joy of Cola
2000 The Joy of Pepsi

2003 Pepsi. It's the Cola

2005 Dare for more

MAJOR COMPETITOR:-
Pepsi Cola major competitor is Coca Cola in all over the world,

About Coca Cola:

Mission

Mission of Coca Cola international is “From our heritage to our mission to the
people who bring our products to thirsty consumers, the Coca Cola is a part of lives
everywhere”.
In order to achieve this mission, we must create value for all the constituents. We
serve, including our consumers, our customers, our bottlers and our communities.

Objective

“Objective of our business strategy are to increase volume, expand our share
worldwide nonalcoholic ready-to-drink beverage sales, maximize our long term
cash flows and create economic value added by improving economic profit”.
The Coca Cola company creates value by executing a comprehensive business
strategy guided by six key beliefs;
 Consumer Demand drives every thing we do.

DARE FOR MORE!

 Brand Coca Cola is the core of our business
 We will serve consumers a broad selection of the nonalcoholic ready
to drink beverage they want to drink throughout the day.
 We will be best marketers in the World.
 We will think Globally and act Locally.
 We will lead as a model corporate citizen

9
 PEPSI TODAY
An Overview

PepsiCo Inc. is among the most successful consumer product companies in the
world with annual revenues of $24 billion and approximately 140,000 employees.
Some of PepsiCo's brand names are nearly 100 years old but the corporation remains
relatively young. PepsiCo Inc. was founded in 1965 through the merger of Pepsi-
Cola Company and Frito-Lay Inc. PepsiCo divisions operate in two major domestic
and international businesses: beverages and snack foods.

Through our divisions PepsiCo has achieved a leadership position in each of these
business segments: we are world leaders in beverage bottling and we are the world's
largest producers of snack chips.

PepsiCo's brand names are some of the best known and most respected in the world
and our restaurants are named as favorites by millions of people. PepsiCo has
achieved a continuing record of growth. This record is based on high standards of
performance, distinctive competitive strategies which are superbly executed, the
personal and professional integrity of our people, business practices and products.

Our overriding objective is to increase the value of our shareholders' investment

through integrated operating, investing and financing activities. Our strategy is to
concentrate our resources on growing our businesses, both through internal growth
and carefully selected acquisitions within these businesses. These strategies are
continually fine-tuned to address the opportunities and risks of the global
marketplace. The corporation's success reflects our continuing commitment to
growth and a focus on those businesses where we can drive our own growth and
create opportunities.

PepsiCo's beverage business consists of Pepsi-Cola North America and PepsiCo

International.

DARE FOR MORE!

Pepsi assumes responsibility for supplying the essential ingredients of a product and
it assures the bottler of exclusive right of sale within their specified geographical
franchise area. It works with supplier firms to assure the availability of quality
packaging, merchandising, and other related equipment made to standard
specifications. It provides advertising campaigns and media support. It creates
suitable promotional campaigns and marketing strategies. It offers aid in personnel
training for sales and production staff. It makes available quality control facilities
and technicians. It develops a national publicity effort and offers aid in formulating
local level community relations projects. And, in addition to performing these

10
functions, Pepsi offers service through a large field force, including specialists in a
number of technical and marketing skills.

The bottler has reciprocal obligations in connection with their franchise right. They
agree to only use approved advertising and distribute a finished product of
unvarying high quality, to use merchandising materials, and to market the product
vigorously.

Today, there are more than 400 Pepsi-Cola Bottlers in the US and more than 600
internationally. The product is sold in approximately 200 countries and territories.
The Company itself operates only a relatively small number of bottling facilities,
principally in larger metropolitan markets.

PEPSICO INTERNATIONAL:
PepsiCo International (PCI) is PepsiCo's international soft drink operation and
includes the business of Seven-Up International. PepsiCo beverages are available in
about 195 countries and territories.

PepsiCo began selling its products internationally in 1934. Operations grew rapidly
beginning in the 1950's. Today PBI accounts for about 20 percent of all soft drinks
sold internationally.

PCI organization consists of three geographic business units, each with self-
sufficient operations and broad local authority. The three units are:

- Pepsi-Cola Europe
- Pepsi-Cola Latin America
- Pepsi-Cola Asia
PCI beverages are produced by a combination of independent franchised bottlers,

DARE FOR MORE!

joint-venture bottling operations and company-owned bottling plants. PCI is the soft
drink market leader in more than 50 countries and territories including Saudi Arabia,
Venezuela, Russia, Pakistan, Hungary and Vietnam. Other key markets include Mexico,
Saudi Arabia, Venezuela and Argentina. PI also focuses on high potential,
underdeveloped markets, such as China and India. PI has also established operations
in the key emerging markets of Eastern Europe, including Budapest, Warsaw,
Prague and Moscow, where Pepsi-Cola was the first US consumer product to be
marketed.

11
The division's flagship product is Pepsi-Cola, with its brand extensions Pepsi Max,
Pepsi Light, Caffeine Free Pepsi, Caffeine Free Pepsi Light, Diet Pepsi, Pepsi Twist,
Pepsi Blue, Vanilla Pepsi, Pepsi X and Wild Cherry Pepsi. The division's other
major brands include Mountain Dew, 7UP, Diet 7UP, Mirinda and Teem. In all, PI
offers dozens of soft drink brands in a variety of packages and sizes.

THE BUSINESS ENVIRONMENT:

Consumers:

Pepsi believe the main 'drivers' behind consumer behavior are value, variety,
attitudes and convenience.

Competitors:
Pepsi's direct competitor is Coca-Cola Amatil. The non-soft drink competitors are
tea, coffee, water, energy drinks, sports drinks, milks, etc which are all consumed
on beverage occasions. Pepsi aims to gain a greater share of these occasions.

The Marketing Mix:

Product:
Pepsi, Pepsi Light, Pepsi Twist, Pepsi Max, Pepsi Diet, Pepsi One, Pepsi
Vanilla, Pepsi Blue, Pepsi Wild Cherry, 7UP, Diet 7UP, Caffeine Free Pepsi
Light, Mountain Dew (including Diet, Caffeine Free, Code Red, and Live Wire
flavors).

Price:
Pepsi is competitively priced to its major competitors, offering a better tasting
product at a competitive price.

DARE FOR MORE!

Promotion:
60% of the marketing funds are spent on advertising. Primarily TV advertising
with radio, magazine, cinema and outdoor support. Other promotional items
include: point of sale material, consumer premiums (e.g. clothing, caps, etc),
sporting and concert sponsorships.

12
Place:
PAH/PI own the Pepsi brands. They sell the concentrate to CSA who manufactures
and bottles the Pepsi products and distributes it to consumers. CSA distribute Pepsi
via various channels e.g. major supermarket chains, smaller milk bars,
restaurants and fast food outlets (KFC, Pizza Hut and Oporto). Pepsi also have
refrigerated vending machines at various locations and workplaces.

Service the right pack size at the right price, in the right place at the right time.

Strategic Marketing:-
The Coca Cola Company versus PepsiCo

Market Share:
Pepsi-Cola ranked as the second -best selling soft drink in American supermarkets
in 2000. A consistent runner-up to Coca-Cola Classic, Pepsi- Cola was joined by
three other PepsiCo products in the year 2000 rankings – Mountain Dew, Diet Pepsi
and Caffeine-Free Diet Pepsi.
Pepsi Coranked second in American CSD market share to the Coca-Cola
Company, holding 31.4% during the same year. Coca-Cola Classic outsold all soft
drinks in America during the year 2000, netting over USD$ 2 Billion at the cash
register. The Coca-Cola Company maintains the CSD market as its primary line of
business. With subsidiaries located throughout the globe, Coca-Cola is easily able
to dominate the Global CSD market.

In the year 2000, Coca-Cola generated only 29% of its operating income in North
America, representative of its large volume of international sales.4 inversely;
PepsiCo maintains lines of business in both the CSD market and the snack foods
market.

DARE FOR MORE!

According to the Beverage Marketing Corporation (BMC), Coca-Cola has held
command of over half of the world's CSD market since 1998. On abrand-by-brand
scale, Coca-Cola took five of the top seven spots globally in 1999, with standard-
bearer Coca-Cola holding a 28.6% share of global CSD volume. Pepsi-Cola was in
second place with a 10.8% share, while PepsiCo's Mountain Dew placed sixth in
terms of global Volume.

13
 Table : 2003 Market Share

Pepsi Cola Coca Cola

Market Share 31.4 % 44.1 %
No. of Countries 160 200
Variety of Product Large Large
Target Market Youth General
Strategy Focus Diff. Differentiation
Diversification Related Related

Market Penetration:
It is the shared goal of PepsiCo and Coca-Cola to increase the overall global
consumption of their products. Kotler and Armstrong contend that improvements in
advertising, prices, service and selection can increase repeat purchases and
attract new consumers 7. In an attempt to increase market share during the famous
“Cola Wars” of the 1980’s and 1990’s, PepsiCo initiated the “Pepsi Challenge”
advertising campaign. Without changing their product, Pepsi temporarily enjoyed a
heightened market share and began to penetrate further into the competitive
American CSD market.

Coca-Cola responded with several attempts to counter the effects of Pepsi’s

successful new marketing strategy. In late 1986, Coca-Cola renamed its top-selling
CSD “Coca-Cola Classic” and launched a corresponding global advertising
campaign. The success of Coca-Cola Classic has been based largely on the integrity
of Coca-Cola’s original formula. Brand loyalty and insistence drive a large
portion of the CSD market, and Coca-Cola has the advantage with their century-old
formula.
In the 1990’s, Pepsi shifted their focus to the growing American teenage market.
PepsiCo adopted a new marketing strategy which aggressively marketed through
high school and college campuses. PepsiCo began selling contracts of exclusivity

DARE FOR MORE!

to hundreds of American schools, benefiting many schools with needed monies, and
providing PepsiCo a direct link to American teenagers. While Coca- Cola
has adopted a similar method of obtaining exclusive selling power, PepsiCo has
followed up with various aggressive advertising campaigns using popular American
teen icons to promote Pepsi products.

“The next generation” motto was replaced with “Joy of Pepsi” and “For those who
think young,” targeting not only American youth, but the youthful mindset of every
consumer. Pepsi continues to use teen and child icons to promote their products,
while Coca-Cola has latched onto the remaining Baby-Boomer

14
market. Through product placement and exclusivity contracts with restaurants,
sports arenas, amusement/theme parks and various large event coordinators,
Coke has been able to increase their overall visibility to counter

Pepsi’s latest marketing strategies.

Speaking on the success of PepsiCo’s aggressively competitive

marketing strategies, PepsiCo Chairman/CEO Roger Enrico writes:

“Without Coke, Pepsi would have a tough time being an original and
Lively competitor. The more successful they are, the sharper we have to be. If
the Coca-Cola Company didn’t exist, we’d pray for someone to invent them,
And on the other side of the fence, I’m sure the folks at Coke would say that
Nothing contributes as much to the present-day success of the Coca-Cola
Company than… Pepsi.”

Market Development:
Identifying new and developing markets for current products – market development
– is another method both Pepsi and Coca-Cola are presently using to increase overall
sales. While PepsiCo’s shift in advertising to a younger audience can be considered
market penetration, it also exhibits qualities of market development. Teenage
Americans have not traditionally been looked at as a powerful consumer group
until recent years. Identifying this developing market, among other
demographic ‘micro-markets,’ Pepsi has been able to penetrate areas that Coca-
Cola has not.

The Coca-Cola Company and PepsiCo alike have taken note of the potential for
expansion in the geographic markets of China, India, Philippines. CSD market
development ties in very closely with both market penetration and product
development strategies. Many CSD preferences are tied to societal and/or cultural
preferences and existing alternatives. Sprite and 7-Up (non-cola CSDs) have

DARE FOR MORE!

been very successful in African-American markets. In 2001, PepsiCo further
augmented their marketing strategy to break into this previously unaddressed micro
market with a new non-cola CSD named Code Red.

Product Development:
While targeting the African-American market, PepsiCo determined that its
Mountain Dew line could be augmented with a new cherry flavor (Code Red).
“PepsiCo also hit the streets to go after the black and Hispanic audience with

15
whom Mountain Dew has traditionally not done as well. Rap jingles starring
Busta Rhymes and Fatman Scoop hit the airwaves, and cases of Code Red
mysteriously began to appear at the doors of inner-city influencers.”

Revisiting the “Pepsi Challenge” from the 1980’s and 1990’s, we see a larger
attempt to increase market share with product development. Prior to releasing
Coca-Cola Classic, Coca- Cola attempted to diversify their product with the
1996 introduction of Coke II. Altering the formula of their best-selling CSD, the
Coca-Cola Company attempted to make the product more appealing to consumers.
Coke II was very poorly received, and Coca-Cola’s attempt at product
diversification failed with thousands of consumer complaints about the new
formula.

In the brand-loyal CSD market, product modification is rarely well- received, as

exemplified by the failure of colorless colas and the poor performance of recently
released lemon-flavored colas.

Diversification:
Starting up or acquiring businesses outside of current markets and products –
diversification – is an excellent way to strengthen a company. Profits and revenues
generated by secondary or even tertiary ventures can provide additional
resources to strengthen a businesses’ primary class of products. However, as
Kotler and Armstrong explain, “companies that diversify too broadly into
unfamiliar products or industries can lose their market focus.”
PepsiCo was faced with this very situation in the mid-1990’s with their
restaurant ventures.

PepsiCo was operating with over 400,000 employees worldwide, many of

whom supported one of the three fast-food chains under Pepsi’s banner. The hot
food division of PepsiCo brought in the most revenue of any of their existing
divisions, but was the least profitable. In 1997,

DARE FOR MORE!

PepsiCo spun off their restaurant businesses as Tricon Global Restaurants, in
move to keep from becoming too over-diversified.
a

PepsiCo, valuing its stability through diversification, moved to acquire Quaker and
SoBe in [Link] specializes in health foods and is the industry leader in non-
carbonated sports drinks. SoBe is a world leader in health and new-age non-
carbonated beverages. PepsiCo correctly identified the global demand for more non-
carbonated ready-to-drink beverages, and was able to move swiftly to

16
diversify their holdings. Gatorade, a sports drink acquired with the Quaker purchase,
sold slightly over USD$ 2 Billion in the year 2000 – rivaling Pepsi’s competitor
Coca-Cola. Coca-Cola does not show any sign of moving into markets other than
ready-to consume beverages, but still offers a wide array of diversified
beverage products. The 239 beverage brands that Coca-Cola produces constitute a
major portion of beverages available to consumers worldwide, covering dozens
of micro-markets. Unlike PepsiCo, Coca-Cola has a long history of success with
international marketing efforts and business strategy. Thus, rather than competing
with Coca-Cola on in the international beverage arena, PepsiCo has ensured
longevity with alternate product offerings.

ORGANIZATIONAL CULTURE

The culture of Shamim & Co. is differentiated with the other Beverage
Companies on the basis of following key characteristics;

INNOVATION & RISK TAKING

The company’s emphasis over innovation and risk taking is much
higher than the competitors and due to this characteristic amassed by all
other Pepsi Cola Franchisees the PCI has got Top position in the year 2003
overall the world that has been published by a very well renowned Magazine
“Fortune”.

DARE FOR MORE!

ATTENTION TO DETAIL
The company’s employees exhibit precision, analysis, and attention to
detail. Due these qualities, the overall performance of the company is
appreciated and very well managed.

17
OUTCOME ORIENTATION
The management of Shamim & Co. focuses on results or outcomes
rather than on the techniques and processes used to achieve these outcomes.
The company got “Mega Plant” status in 2000, 2001, and 2002 due to this
characteristic.

PEOPLE ORIENTATION
The decisions made by the management of Shamim & Co. take into
consideration the effect of outcomes on people within the organization. The
people working under different Managers are treated by the dynamic
approach to get the maximum efficiency from them.

TEAM ORIENTATION
The work activities in Shamim & Co. are organized around teams
rather than individuals. One of the company’s executives says that they do
follow the policy of “TEAM” which is de-abbreviated as “Together”,
“Everyone”, “Achieves”, “More”.

AGGRESSIVENESS
The employees of Shamim & Co. are always willing to accept the

DARE FOR MORE!

challenges and aggressive to accomplish the tasks assigned and competitive
rather than easygoing.
STABILITY
Some areas of working relationship between the employees are kept in status
quo in contrast to growth like socialization etc.

18
 HOW THE NEW EMPLOYEES OF
Shamim & Co.
LEARN CULTURE

Shamim & Co.’s Culture is transmitted to new employees in a number

of forms, the most potent being;

STORIES
RITUALS
MATERIAL SYMBOLS
LANGUAGES

STORIES
One of the most important ways of transmitting the culture to new
employees in Shamim & Co. is stories. Old employees of the company carry

those stories about the people who had worked with the organization. They
are well familiar with the past experiences and their outcomes. They either

DARE FOR MORE!

frighten them or give them courage to follow or not the procedures set by the
company. The old bosses of the department brief new comers how they should
have to perform their duties and what are the norms of the company which
cannot be violated. For example Mr. Asif is the In charge of MIS Department
of Shamim & Co., he is responsible for the initial training of the

19
new comers. He gives them all the details regarding the Department, and
Organization. He tells them about the decorum of the office and likely
behavior to be pretended.

RITUALS
Another important factor of transmitting the culture to new employees
is rituals. Some activities are considered to be the understood activities like
the break for Namaz-E-Juma. As the members of Shamim & Co., are regular
prayer sayings, so a break for the prayer is understood and nobody is
compelled to do any office work during the break. Also there is a company
policy in Shamim & Co., that is to give 15 days annual recreational holidays
with pay. Anybody who wants to go for those holidays, he can go with the
consents of his boss.

MATERIAL SYMBOLS
Another motivational cultural approach is to give due position to the
employees who deserve that position. In Shamim & Co., the top executive like
Mr. Aamir Hameed GM Sales, has been given a chauffer-driven Honda Civic
Car, a latest Laptop, Unlimited use of mobile phone, a well furnished

house, one Umera per year, free cold drinks up to 200 c/s. and a very

DARE FOR MORE!

handsome salary package. So the material symbols like these facilities also
show the best cultural values and motivational tactics for the new comers and
for those persons who work hard in the organization.

20
LANGUAGE
The employees of Shamim & Co. have a formal way of behaving to each
other. They talk formal like “Sir” even to their co-workers. They respect each
other all the way to share the respect. Hence use of formal language is also
key to learn the culture in Shamim & Co.

Reasons of popularity of Pepsi in Pakistan

There are certain reasons for this dominance.

1. Aggressive bottlers.
The pepsi bottlers were more aggressive in their policies and
strategies than that of their competitors. COKE ignored this
region because the share they were getting from this region was
less than nominal, providing pepsi an opportunity to grow up and
capture the market.
2. Anti Jew Movement.
Because of the Arab Israel war, the Arab countries
decided to boycott the Jew products. So they boycotted the
COKE. It opened the gates of success and opportunity for the
pepsi.

DARE FOR MORE!

3. Environmental factors.
Cold conditions in western societies influence people to
use things with bitter taste like beer and coffee, therefore they

21
like COKE as compared to pepsi because the contents of coke
are bitterer. In Pakistan people are more inclined towards sweeter
taste therefore they like pepsi.

CONSUMER REQUIREMENTS
Basically soft drinks are consumer good that is not a
necessity so the companies have to draw money from the pockets
of the customer. This is not an easy process.

BRAND LOYALTY
One of the important features of this industry is the
concept of brand loyalty or brand addiction. Customer who wants
Pepsi will always go for Pepsi. For the same reason a competing
company like Coke cannot divert these customers towards their
brand. But these customers are looking for two things in the
product, which they are loyal to.

PERSISTENT QUALITY

This is one of the main requirements of the

customer. Whether he is in a developed city like Karachi or

DARE FOR MORE!

Lahore or in a remote village, what he wants is that he is provided
with the same quality of the product everywhere. To
have this customer requirement be fulfilled the company needs
not only to manufacture quality product but they also have to
constantly track the product as it moves from there company to
distributors and then to final customer.

22
 These soft drinks can sustain their quality in a
specific temperature specially the glass container cannot absorb
higher intensity of heat. But what these retailers do is that hey
keep these containers outside their shops directly under the
sunlight that really affects the quality of the product. Although
the life of the glass bottles under ideal conditions is almost 6
months but due to above mentioned conditions, the life span
reduces to only a week. Company therefore advises the
shopkeepers to keep the stock under sheds but if they can't then
they should sell it within a week time.

AVAILABILITY
When a thirsty customer comes on a soft drink
corner asks for a desired brand say Coke but if it is not available
then is he not going to go for the next available brand. The
answer will be yes, because he needs to fulfill his thirst and what
is readily available is going to be consumed.
Therefore for companies to keep their, customers
in general and loyal customer in particular, satisfied, they will
have to insure that their goods are in sufficient quantity on the
shops. For this the shopkeepers keep extra stock in their shops.

DARE FOR MORE!

For the quality to be sustained they need to sell the crates which were stocked
earlier. But usually they don't follow the pattern. What they do is that they sell
the bottles on the basis of FIFO (first in first out) method. This
practice also effects the quality of product leading to customer dissatisfaction.

23
 MARKET SEGMENTATION AND TARGET MARKETS
This statement is quoted from Pepsi Cola International official website. “In 1960, Young
adults become the target consumers and Pepsi's advertising keeps pace with "Now it's
Pepsi, for those who think young".
Now there is no specific segmentation of market with respect to customers because their
product is standardized. According to their general manager sales, different brands are
targeted towards people belonging to different age group, according to him 7up is more
likely to be preferred by old age people where as Miranda is popular among teenagers and
Pepsi is preferred by people belonging to any age group.

ACHIEVEMENTS
Last year Pepsi Cola Multan showed their best ever performance of product growth rate in
the Asian Zone and stood fourth in the Asia. Recently last month Pepsi Cola Multan won
the Pakistan quality contest by securing first position. As compared to last year their
production capacity has increased to 100,000 cases per day in peak season.

PRODUCTS
PEPSI COLA
Pepsi cola is their most successful brand with most of the market share .In Pepsi they are
producing following brands

 175 ml
 250 ml
 1000 ml

DARE FOR MORE!

 1500 ml

24
7-UP
7-Up is also popular in old age group of people. 7-Up is a lemon lime drink. In 7-Up they
are producing following brands
 175 ml
 250 ml
 1000 ml
 1500 ml

MIRINDA
Mirinda is the most popular drink in teenagers. In Mirinda they are producing following
brands
 250 ml
 1000 ml
 1500 ml

MOUNTAIN DEW
Pepsi cola has recently launched a new product in Pakistan known as Mountain Dew which
is now a days most popular cold drink amongst adult group. In Mountain Dew they are
producing only one brand 250 ml bottle.

PEPSI INGREDIENTS:-
Water
At least 86% of soft drink is purified water. In the case of diet soft drinks water
comprises around 96%.

DARE FOR MORE!

Sweeteners

Such as sugar (sucrose from sugar cane) or non-nutritive sweeteners. Sugar

is used in Pepsi, 7UP, Mountain Dew and Mirinda. The most popular and most
widely non-nutritive sweetener used is Aspartame. NutraSweet is the

25
registered trade name and it is used in Pepsi Light, Diet 7UP and Pepsi Max.
Aspartame, being 200 times sweeter than sugar, is used in very small
quantities. Other non-nutritive sweeteners permitted are acesulphame
potassium, thaumatin, saccharin and cyclamate. Pepsi Max and Pepsi Light use
a dual sweetener system, aspartame and acesulphame potassium. The latter is 300
times sweeter than sugar, requiring even less to sweeten the soft drink. Shelf
life of the product is extended, as, unlike aspartame, acesulphame potassium
does not lose its sweetness over time.

Flavours
Pepsi uses flavors to develop characteristic tastes associated with our beverages.
These come from a variety of sources; natural, artificial and nature identical. They
are usually derived from a number of ingredients used in special combinations.
Examples of flavors used in the manufacture of soft drinks include natural
flavorings from Kola nut, and fruit. Food acids and bittering agents such as citric,
phosphoric acids and caffeine are also flavoring substances.

Our products and the flavors used in those products are safe and suitable, but they
are proprietary.

Carbon Dioxide
Effervescence gives soft drinks their special bubbly appeal and is added
During production by injecting C02 into the product on the way to the filler.

Colors
Colors are added to Pepsi Cola products to enhance the esthetic appeal and
appearance of products whether they are the typical brown of our colas or the
yellows of Mountain Dew.

These may be both natural and artificial.

Natural colors or colors sourced from natural materials. Many countries have
regulations that specify certain colors as natural. These colors are referred to as
"natural colors."

DARE FOR MORE!

Synthetic (or artificial) colors. Internationally there are many colors that are
accepted.

Preservatives
Certain preservatives are used in soft drinks to ensure microbial stability and prevent
spoilage

Pepsi Cola Brands List:

26
 Pepsi-Cola
 Caffeine Free Pepsi
 Diet Pepsi
 Caffeine Free Diet Pepsi
 Pepsi Twist (regular & diet)
 Wild Cherry Pepsi
 Pepsi Blue
 Pepsi ONE
 Pepsi Vanilla
 Diet Mountain Dew
 Mountain Dew Code Red
 Diet Mountain Dew Code Red
 Mountain Dew LiveWire
 Mountain Dew Blueshock
 Mountain Dew AMP energy drink
 Mug
 Sierra Mist (Regular & Diet)
 Slice
 Lipton Brisk (Partnership)
 Lipton Iced Tea(Partnership)

DARE FOR MORE!

 Dole juices and juice drinks (License)
 FruitWorks juice drinks
 Aquafina purified drinking water
 Frappuccino ready-to-drink coffee (Partnership)

 Starbucks DoubleShot (Partnership)

27
  SoBe juice drinks, dairy, and teas
 Sobe energy drinks (No Fear and Adrenaline Rush) Outside North America
 Mirinda
 7UP (International)
 Pepsi Limón
 Kas
 Teem
 Pepsi Max
 Pepsi Light
 Fiesta
 D&G (License)
 Mandarin (License)
 Radical Fruit

FUTURE PLANNING
The company operates through a well experienced, loyal and hardworking
employees. The first and the most basic plan it to train them according to the
changing technology and computerized environment, and satisfying their needs and
requirements. Upgrading the plant structure and installation of the new machinery
are other plans. The company is planning to increase its sales force and development
in its infrastructure in the coming time period.

DARE FOR MORE!

28
LATEST MARKET SHARE STATISTICS
Latest market shares of brands are given below

BRAND NAME MARKET SHARE

Pepsi 60 %
7-UP 22 %
Mirinda 9%
Mountain dew 9%

SHAMIM CO. (PVT.) LTD.

District Cover by Shamim & Co.

1. Multan A Zone

2. Multan B Zone

3. Multan C Zone

4. Multan District

5. Multan Outskirts

6. Khanewal

7. Mailsi

DARE FOR MORE!

8. Vehari

9. Muzafar Garh

10. Leiah

11. D.G. Khan

29
 12. Sahiwal

13. Okara

14. Bahawal Pur

15. Ahmad Pur

16. Bahawal Nagar

17. Haroonabad &

18. Rahim Yar Khan

As for as products are conserved, company is offering (under given) products in the
market. The details are as under,

Now we are going to discuss the Stock Keeping Units (SKU’s).

Stock Keeping Units (SKU’s)

1. SSRB This stands for Single Serving Returnable Bottle (Regular)

We are offering Pepsi, Mirinda, 7-Up & Mountain Dew in this group.

2. LRB This stands for “Liter Returnable Bottle” this includes Pepsi, Mirinda
& 7-Up. We are not offering Mountain Dew in this class.

3. Pet Bottle (1.5 Liter)

This includes Pepsi, Mirinda & 7-Up. This group also does not have
Mountain Dew in their family.
Here Diet Pepsi & 7-Up are also available to enlarge the range of group.

DARE FOR MORE!

4. NRB This stand for “Non Returnable Bottle”. It can also be called as
“Deposable”
It has 300ml quantity. This group includes Pepsi, Mirinda, 7-Up, Diet Pepsi
& Diet 7-Up.

5. Cane Packing, we are offering cane packing of all that brands that are
offered in SSRB. Including Pepsi, Mirinda, 7-Up and Mountain Dew.

30
6. Post Mix – This includes Fresh / Fountain. This group includes Pepsi,
Mirinda, 7-Up & Mountain Dew. This facility is offered on “QSR” that
stands for “Quick Serving Restaurants” and all those points where no of
walk-in-customers in very huge with their short time stay at that point.

Pepsi Cola International is a large group covering KFC, Pizza Hut,

Burger King, Lays Potato Chips & Aquafina (Mineral Water).

DARE FOR MORE!

31
ORGANIZATION HIRARCHY:-

Managing
Director

General Manager General Manager General Manager General Manager

Technical Sales Finance Operations

Manager Manger Sales & Manager MIS Manager Admin

Production Marketing

Manager Quality Manager Research Manager Finance Manager

Control & SIS Personnel

Manager Account Manager Shipping

DARE FOR MORE!

32
Distribution Channel:-
The company operates through a well-established network of a number of
distributors. The company has two types of delivery systems i.e.

 Direct delivery system

 Indirect delivery system

The basic difference between the direct and the indirect delivery system is
that in a direct distribution system, the company spends its own resources
while in a indirect distribution, the dealers spends their own resources on all
the factors which increased the sale. The company also has its depots in
different cities. Which helps a lot in increasing its sale and directing the
distribution system.

8 Steps of Pepsi Sales:

Our company is very conscious about the development and growth of our
employees especially the sales force. We have designed a 8 step process for
proper guideline of our sales team just to make their sales calls effective
and result oriented. There steps are as follows,

1- Preparation
2- Greeting
3- Stock Checking

DARE FOR MORE!

4- Merchandising
5- Presentation
6- Order taking
7- Curb side de-briefing evaluation
8- Administration

33
1) PREPARATION

i. What are Objective

ii. What to do here
iii. How to do that

Simply where we want to go, & how to get our there.

2) GREETING

It includes greetings and hand-shake. Greet the customer by name & he will
be delighted should be keep in mind of every person involved in sales.

3) STOCK CHECKING (Stock Availability Store Checking)

This includes all the good e is dealing in this will help us to know about his
financial worth patented and clientage.

4) MERCHANDISING (Display)

Display of Visi Cooler

Display outside shop
Availability inside Deep Freezers

It is the most important job to be performed by our sales force.

The order of our product in display should be like this

Top cane packing

Pepsi, 7-Up, Mirinda and Mountain dew

Then

DARE FOR MORE!

Non Returnable bottles
Then

Single serving returnable bottles

Then

Single serving returnable bottles (Regular)

34
Then
Liter returnable bottles & pet bottles on the floor of visi coolers
Every sales person should be caring about the display

5) PRESENTATION

Policy
Scheme
Product availability
Total sales tack

6) ORDER TAKING

Taking Order

7) CURB SIDE DE-BRIEFING

Evaluation

8) ADMINISTRATIONS

Cash
Empty
Sales figure entry
Infection of stock

Company desired to increase it’s market share from 70 % to 80 % or Above. This

is only possible if we
 Retain our exclusive point
 Explore new points

DARE FOR MORE!



Increase sales of points
Increase stock at mix points
 Conversion of coke points
 Elimination of B- Brands

35
 SWOT Analysis
Strengths
 Strong image of PEPSI in consumer’s mind

 In time service of supplies and technical assistance

 More installation of post mix machine

Weaknesses
 No advertisement budgets for post mix.

 No signage’s of post mix in the market

 No promotional activities in post mix.

 No availability of spare parts.

 No proper workshop for post mix.

Opportunities
 Opening of new outlets

 Strong consumer commitment with Pepsi.

Threats
 Coca- Cola is on its way to get market share

DARE FOR MORE!

COMPETITIVE PRIORITIES

36
COST
As Pepsi cola Multan is producing standardized products so they have to maintain a fixed
cost. They want to lower per unit cost as well as the total cost of production.

QUALITY
Pepsi cola Multan is producing a standardized product because all the manufactured items
contain the same amount of the raw material required. So they want to maintain the quality
of products. They want to deliver high quality product according to international standards
given by Pepsi Cola International (PCI).

TIME

Pepsi Cola Multan meets its delivery-time promises i.e. The Company pays most attention
to delivery -on- time to satisfy customers & retailer’s needs on the time, which they want.

FLEXIBILITY

Pepsi Cola Multan does not focus the unique demand of customers & products are
standardized, So Company works for volume flexibility i.e. Company is able to accelerate
or decelerate the rate of production quickly to handle large fluctuations in demand.

OTHER CORE COMPETENCIES

 Strong distribution network
 Wide geographical coverage
 Experienced engineers and sales staff
 Quick customer response and feedback

DARE FOR MORE!

DECISION MAKING IN PEPSI COLA MULTAN
Decision making in Pepsi Cola Multan is influenced by the following factors which
are.

37
AUTONOMY

Pepsi Multan is completely autonomous in strategy development. There is no concept of

dictation from country office rather sharing of policies is more evident. Country office does
not provide any financial resources, human resources or managerial competence to Pepsi
Multan. Involvement of country office is only up to the extent of creating advertisement &
publicity campaigns in which Pepsi Multan also contributes.

FORMAL COMMUNICATION CHANNELS

In Pepsi Multan, there is no concept of informal communication between lower level

managers & top executives. They have to follow proper organizational hierarchy to
communicate with top level managers. For example, Area Sales Manager can’t directly
communicate to GM Sales. He will communicate with DSM which will in turn
communicate with GM Sales. This flow of communication leads to delay in decision
making, noise in information & misinterpretation.

BUREAUCRATIC MANAGEMENT STYLE

Decision making is highly centralized & ideas from lower levels are not welcomed. So idea
generation is not facilitated & top executives are responsible for developing strategies for
their own SBUs. This sort of arrangements restricts innovative strategies & lower level
participation in decision making.

DARE FOR MORE!

ORGANIZATIONAL STRUCTURE

MANAGING DIRECTOR

38
He is the owner of this company and final operational authority to manage all
departments of the company. All departments’ heads are responsible to report him all
about their performances and matters.

GENERAL MANAGER / DIRECTOR FINANCE

He is responsible for overall operation of the facility. He is the overall GM of the facility
and he manages all the decision and strategies regarding Multan franchise and deals with
the country office problems.

GENERAL MANAGER SALES

G. Manager Sales is responsible for the performance of his department and to achieve the
objectives assigned to him such as marketing, sales, distribution. To carry out his duties
more efficiently he has four Regional Managers, 15 Area Sales Managers.

GENERAL MANAGER OPERATION

He is responsible for the whole administrative, shipping, workshop related activities to
smooth on the factory operations without any hindrances.

GENERAL MANAGER TECHNICAL

He is unlike Sales department performs key role as to manage Production Department
producing quality Products as per need of the sales department. Quality Control
Department also works under him.

GENERAL MANAGER FINANCE

DARE FOR MORE!

Finance, Accounts and MIS departments work under his control. He is responsible to
make major company financial policies to meet the needs of the each and every
department regarding budgets etc.

DEPARTMENTS
In order to properly control the operations there are following departments in the company

ADMINISTRATION DEPARTMENT

39
Administration department deals with the overall matters of the company and takes
different actions for increasing the performance of the company. This department also
carries out different social welfare programs.

SALES / MARKETING DEPARTMENT

Sale and marketing is the most important department of any beverage

company. To maximize the sales and profit, this department should be
proper planed and managed. Shamim Co. Pvt. has a very aggressive and
hardworking Sales and marketing department. Due to its efforts the
company has got the first position in sales in 1993 through out the Pakistan.

Following are the major contents of this department:

 Marketing Development
 Tactical analysis and routine planning of market strategies.
 Competition activity monitoring
 T.O.T. management
 Publicity management
 Time management

MARKET DEVELOPMENT

The first and the most basic job of the sales and marketing department is to
plan, develop and make targets. And also to make strategies to achieve
those targets and develop the market. The following major factors are
considered in this respect.

 Collection of all the data about each and every distributors/outlets, about its
sale, volume, growth and exclusivity.

DARE FOR MORE!

 Finding the gaps in the market where there is a potential.

 Finding the points where competitor is strong and hoe we can break this
point.

 Location of non traditional shops where potential is available for the

beverage.

40
  Different offers must be given to break the competitors point or win the mix
point.

OUTLET

Outlets play an important role in strengthening the market. By monitoring

them you can build your market, have their loyalty and increase your sale.
Sales persons should continuously visit outlets, listen their complaints and
satisfy their needs and requirements. They must have information about
each and every outlet, its growth, volume and type business. Proper check
must be maintained to get the feedback from the shopkeepers

Tactical Analysis & Routine Planning Of Market Strategies:

On the market side the sales people gather information and on the bases of
these information they further plan and improve their strategies.

 Checking of the designated area, its sale, volume and growth.

 Calculation of share n brands and package wise
 Calculation of daily sales achievements on monthly target basis
 Location of the poor performance factors and analyzing their cause
 Finding their solution and getting the approval for its execution.
 Planning for a schedule for the designated area.
 Visiting the area according to the plan and reporting it to the higher
management

DARE FOR MORE!

Competition Activity Monitoring
On the other hand a constant intention have been given to the competitors
activities, strategies and offers. They have been compared with ours and
updated according to the environment

41
 Following are the key factors to be noted in respect of the competitor:

 Nothing the competitors investments i.e. T.O.T., Publicity,

 Discounting, Promotional schemes, empty management,
 Cash credit, Vehicles injection (etc.)
 Reporting to the higher authority.
 Taking action to block the competitors activities and monitoring Our

SENSORY INDICES LEVELS MEASURES

Sensory measures means to check the quality and standards through the
senses. The colour, taste, appearance and other specimens of the bottle,
must be checked time by time so that the standards of the PCI may not
doubted

EMPTY & LOAD MANAGEMENT

Empty management means full utilization of available empty at highest

productive Trippage level within the franchise area.

There are two types of empty management i.e.

Empty management within distributors & within Salesman.

The sales and marketing department have to manage, plan and make
strategies a about the distribution of empty whether it is on credit or cash.
The department also has to handle and manage load. Whether it is on
vehicles or shipping or distributors or at the depots level. At shipping level
load management can be divided into

DARE FOR MORE!

 Package wise
 Brand wise
 Demand wise

42
HOW TO MANAGE THE EMPTY

Following are the steps which are necessary to manage the empty

 Estimation of empty available (within shopkeeper)

 Estimation of empty available ( within distributors )

 Previous sales record of each specific area within distributors.

 Trippage level tracking of each distributor for the last two years at least.
 Estimation of sales volume growth for at least last three years

 (Distributors or salesman rout)

 Estimation of empty injection volume for at least three years

 (Distributors or salesman rout)

 Comparison of empty Trippage from the one to other distributors/salesman

rout.
 Factors causing poor Trippage

 Factors involved causing hyper Trippage.

 Empty plan (Forecasting) based on the previous years Trippage

 Level & Percentage increase of empty injection.

DARE FOR MORE!

TIME MANAGEMENT

Time management is the most important factor especially in a Beverage

industry, because it is wholly dependent on Sales and Marketing
Department. And without proper management of time this department

43
 cannot run. Following are the key factors which are to be considered
necessary for the management of time:

 Drop size of a specific area.

 Tonnage of the vehicle for that specific area.

 Total operational time management

 Idle time monitoring and elimination.

 Calculation of outlet knock time.

 Calculation of available knock time for each outlet of a specific

area.

 Define and ideal knock time for an outlet.

 Setting of a comprehensive plan, by considering all the above factors

This is the key department which is making all possible efforts to make company mission
statement to rationality. This department is doing all tedious exercises to increase the sales
of the company by sponsoring different social programs, managing distribution channels,
managing all marketing activities and by advertising to get the competitive advantages.
Country office is responsible for making advertisement strategies and campaigns. All
decisions regarding hiring a specific celebrity are made by Pepsi Cola International for
each country. Pepsi Cola Multan contributes in the advertisement budget at country level.
Currently 10 to 15 distributors are working in Multan region. Distributors pick their orders
from the sales warehouse and then distribute them to retailers who are responsible for

DARE FOR MORE!

providing product to the customers.

Pepsi Multan also provides vehicles to the distributors who cover those regions where they
can not approach directly. The distributors who are using Pepsi vehicles have to pay 1
rupee per crate when they load their trucks for delivering their orders. Marketing
department has a sub department which is SIS department

44
Q. What is the promotion?

Promotion means to make an awareness of the product in consumer mind

for its availability at certain place.

Q. Why you need promotion.

To make the exposure of product.

Q. How you can satisfy about your promotion

Its depend on the feed back of consumer. That how the consumer may
perceive the promotion of product. If the feed back is positive

For Example: the company achieving is object for the promotion then the
defined promotion successful otherwise company observe the drawbacks
for the defined promotion In prove it and implement and the feed back
process against starts, so it is a continues process till the time. The company
may get the Targeted object

Q. What are the sources of promotion?

There are two source of promotion

1. Electronic

2. Print Media.

3. Personal Selling

Q. Which you preferred and why?

DARE FOR MORE!

Both are important because they have relevant work

Q. How many types of promotion?

There are two types of promotion

1. Sales Promotion

45
 2. Product Promotion

Q. How legislation effects on promotion?

Firstly we get approval from govt., for promotion (Price off) volume
duration.

Q. Is there any ordinance or law for governing promotion?

Yes there is a promotion ordinance. All the policies are related with this
law.

Q. How you defend your promotion against your competitors?

To make is more and more attractive for the customer before starting the
promotion normally it is viewed that what sort of promotion activity may
start different ideas are generated and then from these ideas A promotion is
defined with its pros and corns.

Develop a Promotion Mix

Is based on customer

It may be of all natures

It may be for any male, female of any type (relevant to sex age).

Sales Promotion
Schemes of different nature

i.e., Price off scheme

DARE FOR MORE!

Discount scheme.

Various prizes scheme (from) small-to-small & big to big).

Promotional activity Plan

46
 A promotional activity plays a vital role to enhance sales. With this
activities may be done to promote 7- UP and Miranda

In post mix this following are the objectives for promotional activities

o To increase the sales of low volume outlets

o To do product promotion

o To develop the credibility of Pepsi products (Pepsi, Miranda) and 7UP

For promotional activities following prizes may be offered in schemes.

o Cash prizes ranging from RS 5- 1000/=

o T- shirts, caps, school Bags, Kit bags lunch boxes, bats

o Wail man, Rest watch, cassettes/CD, Radios

o Free COLD DRINK GLASS

o Some bumper prize (Diamond ring, Rado watch, CD player. T.V.

Refrigerator)

Promotional Timing
For the promotional activities below stated or the other activities may be
donning in the months of March. April (starting of peak season) and
September to November (sales decline season).

DARE FOR MORE!

Promotional Target Market
For promotional activities low volume outlets, Key outlets, entertaining
outlets may be preferred. This shall encourage outlets as well motivate.

47
Prizes distribution
Prizes may be given to the consumer as conveniently, it could be placed
either at outlet premises or at factory

With the sport of these prizes the below stated promotional activities may
be done.

Scratch the glass

Under this scheme screeching the hidden part of the glass may in hide
prize.

Lucky draw
Under this scheme different small prizes with one-bumper prizes may be
given to winner by making a lucky

Some other activities like PEPSI logo uniform may be provided to high
selling outlets for their serving staff.

Some activates may be done in shape of parks tickets with PEPST printed
over there. In parks various promotional activities could be done like
discounted rate; free cold drinks etc at some selected park for a specific
day.

DARE FOR MORE!

PUBLICITY:-

48
DEFINITION:

Publicity is a non-paid for communication of information about the

organization or product generally in some media form. At a large
organization generating favorable publicity is usually the job of public
relations director. In smaller companies publicity can be the job of
marketers the owner and other employees. Indeed in a quality focused
organization publicity presenting a positive image of all employees.
Because it is non paid and usually reported by media as news publicity
carries a lot of weight with the general public.

DIFFERENCE BETWEEN PUBLICITY & ADVERTISING

Public relation practitioners have a different approach to the media than do

advertisers. Whenever possible they avid purchasing time or space to
communicate messages. Instead they seek to persuade media gatekeepers to
carry their information. These gatekeepers include writers, producers,
editors, talk show coordinators and newscasters. This type of public
relations labeled publicity and is characterized as cost free because there are
no direct media costs. The credibility of publicity typically is much higher
than advertising. I.e., if we tell you our product is great you may well be
skeptical. But if an independent objective third party says on the evening
news that our product is great you are more likely to believe it.

DARE FOR MORE!

TYPES OF PUBLICITY

Publicity comes in many forms. The most common are news stories and
public service announcements.

1. News stories- initiated by the media themselves allows the marketer little
of if any control over the message.

49
 2. Public service announcements space or time donated by media to
nonprofit organization for socially responsible message

GENERATING PUBLICITY

Marketers generate news stories in whatever ways are likely to attract

favorable media coverage. The simplest approach is to circulate press
releases. Marketers may also host’s news conference4s and stage attention
getting events.

PRESS RELEASES

A press release in an article written by company members and distributed to

the media. A press release is a like a mini-news stories. It provides the
media with information about the product or organization.

A press release gives the marketer sum control over news coverage by
allowing the marketer to decide when to make an announcement and what
information to include. In preparing a press release the following tips can
be helpful.

 Keep it short.

DARE FOR MORE!




Use clear concise language

Polish up the lead

 Cite major facts

 Include the name and phone number of the person who can be
contacted to verify the story.

50
NEWS CONFERENCES

The marketer invites reporters to the news conference and usually provides
them with advanced information. A spokesperson for the organization may
read a prepared statement and answer the question from the media men. But
there is no guarantee that media will attend or ask the question that he
spokesperson wants to answer.

ACTIVITIES AND EVENTS

To draw attention on its tenth anniversary a law firm in Orlando

commissioned to photographers to create photos celebrating 20 local
companies, 10 of which where the law firm’s clients. Not only did the
resulting exhibit receive favorable publicity in the local press, but also the
local historical museum added the photos in its collection.
As in this example the key is to create events that are some how favorable linked to
the organization or its products. “Thus there are as many ways to generate publicity
as there are ideas in the mind of marketer

Pepsi Takes new twist’ on Cola

DARE FOR MORE!

Pepsi Twist, the great Taste of Pepsi with Lemon, enters selected markets in

the United States PURCHASE, NY, June7,2001 – Complementing the grit

taste of Pepsi with a twist of lemon, Pepsi-cola company is introducing a

51
refreshing new product called “Pepsi Twist. “Regular and diet versions of the

crisp new cola now are entering retail outlets in selected US markets.

“Consumers have been telling us they’re looking for something extra in their
soft drink options, “said Dave Berwick, vice president of carbonated brands
for Pepsi-Cola north America. “We know that nationally more people prefer
the taste of Pepsi. With Pepsi Twist, we’re dialing up the refreshment
possibilities while focusing on the bigger picture of expanding flavor variety
among colas.”
Pepsi Twist was tested as a summertime-only proposition last year in
Minnesota and Texas, where it met with tremendous consumer response,
boosting total Pepsi trademark volume, display inventory and awareness
Its expanded availability this summer covers about a third of the country.
Predominantly the central United States. Pepsi twist is being distributed in a
wide range of packages wherever Pepsi products are sold in those markets
Dedicate television, radio and point-of-purchase ads are supporting the
rollout of Pepsi twist where available. An introductory TV spot is set in a zoo
on a scorching summer afternoon. It’s so hot even the penguins take
extraordinary measures of stay cool. Created by Pepsi’s longtime advertising
agency, BBDO New York, the humorous new commercial invites consumers
to try “A New Twist on refreshment.”
Purchase. NY – based Pepsi-cola company is the global beverage division of
PepsiCo, inc. in addition to Pepsi Twist, is brands in the United states include
Pepsi, diet Pepsi. Pepsi ONE, mountain dew, Mountain Dew code red, wild
cherry Pepsi, sierra Mist, Mug, Slice, Aquarian, Fruit works, Doe single-
server Julces and So Be. The company also makes and markets category-
leading iced teas and coffees, respectively via joint ventures with Lipton and
Starbucks.

Pepsi-Cola’s culture is informal and entrepreneurial. Our people are

DARE FOR MORE!

empowered to make the decisions necessary to grow the business. We seek
to achieve outstanding results through innovation, long term partnerships,
and an open work environment that respects the individual and promotes
personal and professional growth
Pepsi-cola products account for about one-third of the U.S. soft drink
market. Brands include Pepsi; diet Pepsi, Pepsi One, mountain dew slice,
Mug Root Beer, Aquarian and All Sport Through the Pepsi/Lipton tea
Partnership. A joint venture of Pepsi-Cola North America and Lipton, we
are the leader in the ready-to –drink tea market. In addition, we virtually

52
 created the ready-to-drink coffee category with the introduction of
frappuccino through our joint venture with Starbucks Corporation.
Pepsi-Cola North America (PCNA) manufactures Pepsi-Cola beverage
concentrates and sells them to bottlers in the United States and Canada. We
develop the national marketing, promotion and advertising programs that
support our brands and generate new products and packaging. Pepsi-cola
people coordinate selling efforts for national fountain, supermarket and mass
merchandising accounts. Whether it’s a new package or a new computer
application, our goal is the same meeting customer needs.
 Sales Information System
Sales Information System, which is working under marketing department, is
responsible for making decisions regarding either to provide chiller or not, either
to sponsor store publicity arrangements or not and etc. decisions are made on the
basis of store look, location and amount of turnover provided by the retailer. This
department also provides information about the distributors and their product
requirement
 Research And SIS Department
This department works under the marketing department and its responsibility is to
check the market performance of the product and provide information regarding the
product status and its market share. They are also responsible for checking the
performance of the new products like Mountain Dew, Its acceptance and capacity
to launch a new product in the market.
Market Research & SIS is a very strong department, aimed to keep current
record of each & every outlet of the franchise. Through this system,
management can come to know

 Market Share
 Name & address of each outlet. T.O.T details

DARE FOR MORE!



Publicity position
Discount verification

The system is designed in such a way that reports can be obtained about
outlets:

 Distributor & area wise

 Route wise
 District wise

53
 The system is useful in accessing market & investment position in each
area.

Market Share:
Research Assistant Manager (Saeed Bhutta) analysis is a proprietary methodology
developed to help share determine whether their sale should go the market,& new
competitive products in this market. This analysis allows research supervisor to go into
the market, identify the components that establish market share, and determine which of
those like availability, Chiller, Empty stock in order to improve their share position.

Research supervisor analysis the market & visit the shops, they analysis and click’s on
there checking share format after the completion of sample size, they come back and submit
these checking format to the Computer Section. Here information feed in the computer
program and generate the result in the form of Share Summary.

Define the market

Before creating strategies, you need to define the marketplace in which you compete and
create lists of your key competitors and the various channels serving your market.

Segment the market

The first step in creating "take share" strategies is to segment the market based upon the
buying behavior of your customers. The market segments you choose must satisfy market
criteria.

DARE FOR MORE!

Market category
- Main
- Side
- Village
- Captive

54
Main Market – means main road, high volume market, wagon stands,
commercial area.

Side Market – means colonies, mohallah, entrails, links road, side road

Village Market – means village sides, small areas

Captive Market – means parks, cinema, canteen, institute, govt. offices,

kutchary, courts.

Market Sample Size

- Main Market 45 % of Total Sample
- Side Market 30 % of Total Sample
- Village Market 25 % of Total Sample

Stock Base Share

- Availability
- Chiller
- Fresh Consumption
- Floor stock

Exclusivity Base Share

- Pepsi Exclusivity
- Coke Exclusivity
- Mix

SIS deals with Tools of Traders (TOT). T.O.T. means list of items available in a

DARE FOR MORE!

shop, which helps to sell our product conveniently on priority basis. It is one of the
major investments being made by the company. T.O.T. management completely
depends upon the Sales force. The factors to be considered are

 Data collection about the sale, volume, growth, profitability, size and place
of the shop

 Record of all the T.O.T. given to the shopkeeper.

55
 o Deep Freezer
o Visi Cooler
o Ice Chest
o Bottle Rack

 Further plan for the injection of T.O.T.

 Checking all the equipment time by time any removing their complaints

FINANCE DEPARTMENT
It deals with the financial matters of the company. It collects the revenues and makes
different payments and maintains proper record of the financial performance of the
company’s business to show the net result in the form of either profit or loss. Finance
department consist of
 Management Accountants
 Cost Accountants
 Accounting MIS Department

HUMAN RESOURCE MANAGEMENT

All hiring and firing decisions are done locally by the franchise. There is no involvement
of even Country Office. All decisions regarding pay scales, promotions, demotions and
increments are done by the franchise itself. All training arrangements are made by
franchise itself. All hiring is done through references there is no concept of job
advertisement in Pepsi.

DARE FOR MORE! PRODUCTION

This department is responsible for the production of the products according to the
requirements of the customers. Production department have to manage the inventory of all
types. Currently they are having five production plants and all of them are automated. Now
they are planning for the installation of three new plants. Mostly they go for importing their
production plants from Italy, Germany and Netherlands. Previously they used to purchase

56
Ammonia for cooling purposes but recently they have installed an Ammonia plant with in
their own premises. Now they purchase CO2 for the production of Ammonia gas.
Regarding the use of management information systems, they are shifting their production
record from manual system to computerized system. Production department can be divided
into sub departments which are
 Quality Control Department
Quality control department is responsible for checking the quality of the product.
After every 3 hours a quality check report is presented by this department to the
production manager and GM technical. In case of any problem with the quality,
after every half an hour quality is checked.

 Technical Department
Technical department is responsible for any technical assistance needed in case of
any plant problem. They also maintain the spare parts inventory which is used in
case of nay breakage or malfunctioning of plant part.

 Procurement Department
This department is responsible for any assistance needed to purchase the technical
parts. In case of any purchase of plant or any part of the plant they help the
purchase department for purchasing the right part.

DARE FOR MORE!

Bottles Washing Plant:
In the plant, syrup (from syrup tanks) and water (from water treatment) is
mixed at a specific ratio called flow mix. The mixture then moves to carbo
cooler where carbonation of product i.e. absorption of CO2 in the syrup at
low temperature is done. It then moves to filler where product is filled in
empty bottles and crown caps are put on it. The final product moves towards
packing machine through conveyer however most of the time bottles are
packed into cases manually.

57
CO2 (Carbon Dioxide) plant:
CO2 assures the product a measure of added sanitary protection and greater

shelf life. CO2 gas in addition to product carbonation, contributes to the

production process itself by:

 Displacing air from water and product during processing.

 Supplying counter pressure needs for some filler bowls.

CO2 enhances both beverage's taste and appearance. Carbon Dioxide

imparts a pungent, slightly acidic taste to the finished product as well as
creating greater eye appeal. Each individual product should be carbonated
to a level most suited for that flavor.

IN PROCESS TESTING

BRIX INVERSION TEST

The purpose is to break the sugar molecule into simple molecule of glucose
and fructose, Inversion is performed to confirm on-line brix target .the test
is taken after an hour of starting tank on production line.
FILL HEIGHT TEST

The purpose of fill height measurement is to verify that containers are

consistently filled to the correct level as established depending upon
package size. Fill height is the distance from the top of bottle to the
meniscus of the liquid.

DARE FOR MORE!

BRIX BY HYDROMETER TEST
The purpose is to measure by weight, the percent solids of sugar in simple
syrup, finished syrup, control drinks and final beverage. Brix is defined as
by weight percent solids of sugar.

pH TESTING
pH scale indicates the amount of acidity or alkalinity. pH is measured for

58
 Raw water, treated water, control drink, finished beverage, T.A. testing and
incoming raw material. The purpose of the test is to define the line Brix.
This also helps in predicting the sensory attributes of the beverage.

TITRATABLE ACIDITY TEST

The purpose of the test is to measure the acidity level in the test sample.

INCOMING RAW MATERIAL TESTING

 Sodium hydroxide (Caustic Soda) %purity test
 PROCESSING MATERIAL CALCIUM CHLORIDE TEST
 Conductivity Ash in granular sugar by conductivity meter:

The purpose is to test the incoming sugar for its ash contents in order to
define quality. Sugar ash is primary indicator of sugar sensory performance
in a beverage. It is comprised of organic and in organic salts left over from
the refining process. The sugar is used in syrup making.

Processing Materials Ferrous Sulfate Test:

The chemical is used in syrup water treatment.

Processing Materials Activated Granular Carbon Test :

The chemical is used in syrup making and water treatment.

Crown Corks/Caps Inspection/ Attribute Analysis:

The purpose is to ensure that incoming lot of crown corks/caps fulfills the
appearance requirement and free from defects. Crown caps are used for

packing (sealing) of bottles after filling. Crowns and closures should match

DARE FOR MORE!

supplier shipment label and purchase order. The characteristics considered
in the analysis are outside printing, inside printing, color, shell or liner
flash, cracks, band etc.

Glass Bottles Inspection/ Attribute Analysis:

The purpose is to identify the visual defects effecting the beverage quality
in the incoming glass. The defects are categorized as following. Very
critical defects: Any defect dangerous for personnel.

59
Critical Defects: The defects that result in hazardous or unsafe conditions for
smug, maintaining or depending upon the product. These could be Struck
glass, Loose glass, False bottoms, Bird, Swings. Major defects: The defect
likely to result in failure or reduce materially the usability of the product for
intended purpose. The defects are Cracks, Chocked necks, Bent neck,
Stones over 1.6mm (1/16 inch) etc. Minor defects: a minor defect is
departure from established standards having little bearing on the effective
use. These could be Brush marks, Seeds, Birty molds, Dirty finish etc.

HYDRATED LIME TEST

Hydrated lime is used in water treatment ( Reaction tank).

Taste, Odor & Appearance Test: Granular Sugar:

It is granular sugar test for its sensory attributes for consignment
acceptance or rejection for every delivery.

 CO2 purity test: CO2 used in Carbo cooler for absorption.

 Chlorine (sodium hypo chlorite) test: Used in water treatment.

Post Mix tanks inspection:
Post Mix is undiluted fountain syrup that is delivered to retailers in transfer
tanks. The inspection is performed before filling new or market returned
tanks. A form is filled with the following format

Pre-inspection Safety
Tank# Product Appearance Washing Filling Performed
O-ring Wolves

DARE FOR MORE!

Post Mix tanks washing:

It is in order to eliminate the chances of contamination. The steps are .

Rinse with treated water

 Clean with detergent

 Rinse with treated water
 Sanitize with chlorine

60
  Rinse with treated water
 Sanitize with steam

CALIBRATION
The calibration ensures that the equipment is fit for its intended use.
Calibration is very integral and critical because instruments are eyes into
the process and if the are not working properly, the process may produce
unexpected or undesired results.

PRESSURE GAUGE CALIBRATION

The purpose is to test the non-existence of pressure difference & note if

difference exists.

HYDROMETER CALIBRATION

The purpose is to test the non-existence in Brix reading and note if

difference existed.

THERMOMETER CALIBRATION

To assure that thermometers are properly tested for their exact temperature
reading. The calibration is for:

DARE FOR MORE!

o Dial thermometers for washers
o Mercury/ Alcohol thermometers for laboratory testing

 pH meter model H18424 calibration

 pH meter model H8314 calibration
 Calibration for TDS meter
 Conductivity meter calibration
 Refract meter calibration

61
  Incubator calibration
 Syrup tanks calibration: to get actual syrup volumes.
 Temperature gauge: to test their exact temperature.
 Pressure gauge calibration
 Hand refract meter

SUGGESTIONS

 In the production hall, very concerned person must use masks, gloves and safety
glasses.
 Earplugs should be provided to the people working in the production hall.
 Proper sitting room should be provided to CO2 supervisor to keep the spare
parts, tools and documents safely.
 Labor should wear neat and clean uniform.
 Proper arrangement should be for draining
 Many under 18 age boys are working in production.

PCI QUALITY RATING

PCI collects product samples from market, tests them in their labs against standards,
sends monthly test results summary to their franchisers and allots rating (colors) to
franchisers after every three months. The PCI Operations Director - Quality Systems
for Middle East, North Africa & Pakistan sends rating of 44 factories including
SHAMIM & CO.. The color rating is based on following criteria.

Color Rating Previous New

DARE FOR MORE!

Sensory- Ana~cal Sensory Analytical
Red < 70 % < 80 % < 70 % < 85 %
Orange < 70 % > 80 % < 70 % > 85 %
> 70 % < 80 % > 70 % < 85 %
Yellow 70 - 85 % > 80 % 70- 85 % > 85 %
> 85 % 80- 90 % > 85 % 85 - 90 %
Green > 85 % > 90 % > 85 % > 90 %

62
Green both Sensory/ Analytical good

Yellow Sensory Satisfactory/Analytically good

Or
Sensory good/ Analytically satisfactory

Orange Sensory unsatisfactory/ Analytically satisfactory

Or
Sensory satisfactory/ Analytically unsatisfactory

Red Both Sensory/ Analytically unsatisfactory

 SHAMIM & CO. has been in yellow color after the standard percentage is
Increased.

PRODUCTION PROCESS
Company is having flexible production plants. Company can change production according
to demand fluctuations. Process is same for all products i.e. Pepsi Cola, 7-up, Mirinda and
Mountain Dew. No plant is fixed for a specific product.

1st STAGE (GETTING TREATED WATER)

‘Lime’, Farris Sulphate (for iron) & chlorine are added to raw/hard water & it goes in
“chemical tank” where carbonate and bi-carbonate are settled down, & they get treated/soft
water.

2nd STAGE (PREPARATION OF SIMPLE SYRUP)

Simple syrup is made by mixing up sugar into water after pasteurization of water at 80˚ C.

DARE FOR MORE!

After some time, this simple syrup is filtered & then cooled down at 19˚ C. Water is boiled
at normal temperature like 32˚ C to 35˚ C to kill germs.

3rd STAGE (PREPARATION OF FINISHED SYRUP)

Now this simple syrup goes into syrup storage tanks. Concentrate & flavor are added to
simple syrup & it is called finished syrup.

63
4th STAGE (WASHING EMPTY BOTTLES)
Empty returned bottles pass through steam under 57˚ C to 77˚ C, and then those bottles are
dried. This stage takes 45 minutes. Now bottles are washed by Caustic-Soda, TSP and
water. Now a light-test is conducted for washed bottles, where the bottles pass through a
light.

5th STAGE (FILLING SECTION)

Now finished syrup & treated water come to Carbo Cooler in which NH3 (Ammonia) chips
are used for cooling purpose. CO2 gas also comes in Carbo Cooler. After a flow-mix in
Carbo Cooler, the resultant drink comes into filler where empty washed bottles are filled.

6th STAGE (CROWN FITTING)

Now bottles come to Crowner where they are crowned and then bottles pass through a light
test to have a check for over filled, under filled or any deficiency.

7th STAGE (PACKAGING)

After passing through packager, the boxes of bottles are packed.

SHIPPING DEPARTMENT
Shipping is a very critical area for any beverage organization. It serves the

DARE FOR MORE!

role of coordinator or middleman between production and sales. Ensuring
appropriate quantity and on time availability of empty & liquid stock is
utmost important. Any malfunction in empty receiving, storage, supply to
plants, liquid stock and distribution directly affects sales. This is a complete
chain or cycle and any weak link, bottle neck or disturbance will slowdown
the whole operations.
Shipping department has following main functions.

64
RECEIVING & STORING NEW OR USED EMPTY

New empty is purchased from Pakistani or foreign suppliers as required.

Management of production, shipping and procurement takes the decision of
when, from where and in what quantity to buy new empty.

 After approval, the purchased lot is identified with quality control passed
stickers.
 Consignment is unloaded at the empty godown.
 Empties are transferred in cases manually and inspected for breakage.
 Cases are transferred to plant as per requirement on empty movement slip.
 Empty incharge does, stock taking and maintain daily empty stock physical
report. Shipping department also receives used empty from dealers,
distributors, salesman etc.
 Dealer/Salesman arranges the return of empties from market as per contract.
 On arrival of vehicle, dealer/salesman records entry (detail of empty) on gate
register. A token # is issued to every vehicle.
 Shipping staff unloads vehicle on the token number. Empty incharge checks
then for breakage and they are sorted out physically in standard, junior, liter
sizes and put into cases brand and size wise.
 Empty incharge prepares empty slip. Empty slip has an office copy and three
other copies at factory one copy goes to MIS, other is for shift incharge at
DP godown and the third is for gate office.
 Gate office reconciles the copy of empty slip with initial entry.
 Gate register has two parts, one is for gate entry and the other is shipping
received. Details of empty slip must match with the earlier gate entry

 otherwise empty incharge & shift incharge is informed.

SUPPLY OF EMPTY TO PLANTS

DARE FOR MORE!

Shipping department has two godowns for empty storage. These are
godown No.1, No.2

PEPSI TOWN

Due to shortage of space in godown # I, empty is unloaded at godown

# 2 or sent to PEPSI town. This empty is returned when storage space
becomes available at godown # I. Empty is supplied to plant when

65
 required by production people in specific quantity. the delivery is
through forklifts.

Daily production report.

Report Product Loss Dirty Return To

Sign of production office

LIQUID STOCK & DISTRIBUTION

Plant RG I Excise DP Distribution

Clearance Godown

& payment

From DP godown liquid stock is issued to three main parties.

i) For the base market salesman directly take load from factory godown. At the
end of the day, they return the empty and deposit daily cash.
ii) SHAMIM & CO. has five depots to ensure smooth, regular supply and stock
maintenance in other cities covering whole franchise area. The depots are
treated like distributor /dealers. Shipping, sales and MIS staff works in
depots. Trucks are made available by the company on contract to supply
liquid and return empty frame depots settlement sheet of depots in prepared
and cleared by the transfer of cash from dealer's account to company
accounts.
iii) Some dealers whose area is not base or under any depot's range also take load

DARE FOR MORE!

directly from factory and clear their settlement sheet by cash payment.

The procedure for all three types of parties is same. The salesman / drives
deposits empty slip to MIS computer operator. Liquid slip is issued to the
salesman on which the quantity, size and brands are specified. Vehicle is
loaded in the DP godown monitored cleared by stock incharge.

66
 FINISHED GOODS STORAGE

Finished goods storage should be secured against sunlight, rainfall,

moisture and other intimidation.

 Issued on FIFO (first in, first out) basis via validity of production dates. It
ensures that product is not expired, bad taste and visually unattractive.
 Shift wise record of daily transactions is maintained.
 These are physical stock taking for physical but not for expiry dates.

HANDLING & PACKAGING

Forklifts are used for transferring FG shells I cases from production area to
shipping hall or not delivery ducks to ensure product do no get damaged.

All Pepsi Cola carbonated soft drinks are packed in glass/PET bottles or post
mix tanks. This is called primary packaging. Filled glass/PET bottles are further
secured by means of plastic or wooden shells/cases called secondary packaging.

PROCEDURE OF EMPTY & LIQUID IN/OUT

IN Liquid
Empty
 Stocktaking of empty at the Stocktaking in the morning and
beginning Of shift (copy) entry on Liquid Received and
 Empty unloading Issued form Full in and liquid
 Checking for empty slips to MIS, receive from SHAMIM & CO. Is
 Dealer and an office copy added on the form.
 Addition of new arrival in copy

Out Liquid
Empty
 Empty send to SHAMIM & CO. on

DARE FOR MORE!

MIS issues liquid slip
New and Others Empty Slips.
 The amount is subtracted from copy Liquid is loaded on the sales
vehicle according to liquid
Slip
Minus the amount from Liquid
Received and Issue form

67
RESPONSIBILITIES OF DEPOT INCHARGE

 Monitoring of empty and stock in charges

 Maintenance of shipping records and documents
 Reconciling physical stock with MIS reports
 Posting on balance sheet register
 Sending daily stock report and dealer wise sales report to factory
 Receiving bank slips from dealers
 Clearance of depot's settlement sheet
 Transfer of cash to friends agency account
 Maintenance of stock FIFO system

During my visit to depot, I studied depot operations and

 The job of stock incharge.

Performed the job of empty incharge.

 Worked on the seat of shift incharge.

 Drew liquid laws arrangement, Depot layout and time study of

loading & unloading of vehicles.

OBSERVATION AND SUGGESTIONS

DARE FOR MORE!

 Extremely poor situation condition at godown # 2.

 Dirty empty washing in godown # 2 is with HC1. Which is very hazardous

to the people working there is well as it can cause problems when empty is
filled.

 It is a very difficult task to manage vehicles parking at unloading pad,

providing way to forklifts transferring empty to the plants, and maintaining

68
 lanes properly. Trunks and other vehicles have to wait for hour in queue for
their term.

 Environmental conditions are not good. Shipping staff and labour has to
work whole day in sales vehicles and forklift's. It causes health problem for
them liquid is supplied to depots based on daily sales and current stock
position. But many times they receive unneeded liquid.

 No financial or statistical technique is used to calculate what is appropriate

stock level in a depot, when liquid should be sent and in what quantity.

 Pepsi town is a big land area. Where a huge stock of empty is lying.

 Empty should be kept under shelter to protect against weather. There is no

proper arrangement of empties. There should be kept in an ordered and
countable way.

 Breakage, rejected empty, TIN packs and other useless material must be sale
out by getting maximum price.

 The job of empty incharge, stock incharge, shift incharge is very demanding.
It requires mental ability, efficiency, physical fitness, ability to manage
people and space and responsibility. They are paid low as compared to the
people of same rank in other departments.

 Shamim & Co. announces two best employee of the month awards each
month from production and service sector. Production sector includes
production and quality control department while service sector includes
shipping, Admin, procurement & stress, MIS, cash and accounts department.
This award is won by an empty incharge of shipping from

service sector. Shipping is a large department where 250/300 people work. There
should be a separate best employer of the month award for shipping. The jobs of

DARE FOR MORE!

shipping staff are more physically & mentally demanding. It will motivate and
help them to some out of the complex that shipping is an ignored part of the
organization.

Management Information System (MIS)

In today's fast moving business environment, organizations are rapidly
moving towards computerization and information systems.

69
 In this era of rapid of frequent changes, it provides current, reliable and
accurate information to the management. This information is very useful in
decision making. Information systems are generally defined as the system
which provide regular and current information to management for decision
making.

MIS department of Shamim & Co. is playing a vital role in this regard. The
department is working with a small setup & satisfying the information
requirements the organization with a smart staff and developed setup, the
department has eliminated much work load, paper work and saved a lot
previous time.

The software system have two basic parts and these are developed in some
programming language. The post important part of any information system
is database. The database is the basic structure of data and defines how data
is organized, stored and retired from memory. The database operates at the
back end. At the front end, data is entered and retired through input screens.

The MIS department is currently performing its day-to-day operations as

well as involved in software development. It also provide technical
assistance and training to other departments. At the time oracle 8.0 is in
execution. All computer in the department are networked by LAN (local
area network) the department has licensed software working.

The following systems are working in the department.

Plant Efficiency System:

The system is designed to keep current information about what is going on

in production & plants. The system is helpful in getting production figures

and reports about line utilization, line efficiency, mechanical efficiency,
employee code, name, basic salary, allowances, tax, net pay and any other

DARE FOR MORE!

adjustments supplied by time office.

Sales & Distribution System:

The most comprehensive system of MIS is sales and distribution system. It

incorporates

 Sales system

70
  Cash system
 Shipping system
 Post mix system

The basic input of this system is empties slip, liquid out slip, full in slip by
order sips. empty short slip, the reports of the system are

 load report ( dealer wise, depot wise )

 settlement sheet ( dealer wise, depot wise )
 Shipping shift summary .
 Daily liquid out report.
 Pending report.
 Agent wise load out summary.
 Agent wise sales summary .
 District wise sales summary .
 Computerize sales statements
 (monthly, semi annually, annually)
 Cash report

Filled inspection, breakage, actual production, paid time, stoppage,

production time etc.

Excise And Sales Tax System:

DARE FOR MORE!

Shamim & Co. is a regular tax payer of govt. of Pakistan. it pays excise and
sales tax according to its production and sales. the system is developed to
keep complete record of the tax transactions. stock of the product at the RG
I is maintained after production. the stock is moved to DP (duty paid)
godown after its clearance by excise inspector and payment of 15 % tax. at
RG I, closing stock of a day is opening RG I stock plus day's production
and minus tax clearance.

71
Payroll System:

There is separate payroll system for Shamim & Co. and Friend's Agency.
The output of the system is pay slips and payroll report at the end of month.
Payroll report incorporates.

All these reports are extremely important in the day-to-day operations of

the abovementioned departments. In addition, customized reports can be
obtained as required. The system is implemented at each depot as well.

CASH DEPARTMENT
Cash department does cash handling (collection and payment). The major
part of cash collection is from dealers and salesman based on their
settlement sheet and daily sales report. Cash payment is done on the
vouchers issued by accounts department. Payments include employee's pay,
bills, allowances, procurement expenditures and day to day general
expenses.

AUTO WORKSHOP
The function of auto workshop department is top provide repair,
overhauling and maintenance services to the vehicles used in the
organization. These vehicles include Mazda, Toyota, Hino, Suzuki, Honda
and forklifts (Toyota, TCM) of different models and capacity. Total number
of vehicles served by the auto workshop is about 140. the responsibility of
auto workshop is to keep PEPSI fleet efficient, deendable and energetic.
Different departments particularly shipping and sales use these vehicles.
Vehicles outside # are mostly used by sales staff. In case of some major
work, it comes to workshop however if there is nominal repair work, they

have it done locally. The staff of the department consists of 20 persons

DARE FOR MORE!

including mechanics. Record keeper, supervisor and headed by auto0
workshop manager.

DOCUMENTS / REPORT IN THE DEPARTMENT:

Daily performance report:

Vehicle # Detail of Visit Job Name of Driver’s Remarks

work outside complete/Incomplete mechanic name Sign.

72
 work

Monthly performance report of auto workshop:

Maintenance Engine Welding Engineering Engine Tier tube Servicing Motorcycle

work Complete Fabricating work from Oil changing & repair work
overhauling Denting local market changing repair Greasing
Painting work work

 Work order indicating defect, repair work and remarks and after repair a
certificate showing that maintenance work is alright signed by the driver of
the vehicle.

 Work order for market.

 Log book in each vehicle for each driver.

 Gate pass

 Store requisitions for transport spare parts and stationary. A small section of
store working under main store is maintained in the workshop

THE DEPARTMENT HAS FOLLOWING SECTIONS

 Electrocution section
 Tire maintenance section (compressor) Body welding section
 Service section
 Tool room

WORKING PROCEDURE

DARE FOR MORE!

 For any repair work, the driver must fill a work order signed by his respective in
charge. The work order is also necessary for cars and motorcycles.

 The work order is refereed to record keeper who hands over to supervisor after
entering in register and reports to work shop manager in case of accident.

 The supervisor is responsible for assigning the job to mechanic by matching the
type of work and his skills.

73
 In case of some work required from market, supervisor himself goes with the
vehicle or assigns one mechanic to monitor market work.

 The driver signs the work order certificate after his complete satisfaction.

OBSERVATION / SUGGESTIONS
 Standards are set for mobile oil change, air filter change, mileage etc. of different
vehicles. The data needs to be maintained and regularly evaluated.

 Specialized workers are needed to work on different parts of vehicle e.g. spring
load, radiator etc. as well as for petrol and desile vehicles. Specialist mechanics
demand higher pay. For this reason, department has to get services from market.

 There has been no training for mechanics, they are learning only by time.
Mechanics can acquire new skills and save expenditures by attending short
courses as one diploma holder mechanic is praised by department head because
of his ability to communicate and better understand problems.

 Maintenance and smooth of vehicle is dependant upon driver's understanding

and care for the vehicle. There is no formal training for drivers as well.

 Short training camps should be arranged by the department conducted by

engineers of the companies/dealers from where SHAMIM & CO. purchases
vehicles.

PROCUREMENT & STORES

DARE FOR MORE!

The department is responsible for all the purchases (including raw
material), storage and issue of materials to various departments.

SUPPLIER SELECTION

Selection of right supplier is an important job being performed by the

department. Selection criteria differs from one category to another category
.

74
CRITICAL

These items are very much sensitive and one has to be cautious about
making final decision about suppliers, in SHAMIM & CO. following
factors are taken into consideration while selecting supplier for these items

Past performance record

PCI approved suppliers
Site audit
Self assessment through questionnaire
Product inspection and testing
Compliance by any appropriate standards or
specifications

TECHNICAL/GENERAL ITEMS

While selecting a supplier for technical and general item any of the
following method is used.

 Past performance record

 Competitive price in market
 Delivery requirement of Shamim & Co.
 Availability of items in the market

Purchases can be divided easily into

RAW MATERIAL PURCHASES

For the raw material purchases, there is a list of suppliers approved by Production

DARE FOR MORE!

Manager, Quality Control Manager and Procurement Manager

based on their product quality. The procedure is that product samples are tested
in the laboratory and then after complete satisfaction of quality, supplier is
approved and sends his quotation.
Shamim & Co. has approved supplier list for following materials

Concentrate Plastic shells

Sugar Activated carbon

75
 Glass bottles Crown corks Closures Packing cartons Pet bottles

CO2 gas Hyflo super

Glass bottles Ferrous sulfate
Crown corks Caustic soda
Closures Bleaching liquid
Packing cartons Sodium chloride
Pet bottles Lime

There are raw material specifications and special instructions regarding:

 Chemical properties
 Physical properties
 Packaging
 Sampling details
 Storage & handling

Production department sends monthly demand and quotations for the

quantity net of current stock and wastage are invited.

Material requirement by Production dept.

Opening/closing stock adjustment by Stores
Material to be purchased by Procurement dept.

Some time purchase quantity decisions are made on the space available in the
store. After the material is purchased and Gate checking, it is again send to quality
laboratory by FIFO rule.

GENERAL PURCHASES

For the general purchases like stationary, technical parts, supplies etc issue
requisition slip (in case required material is in the store) or purchase

DARE FOR MORE!

requisition slip ( in case required material is not in the store stock) signed
by concerned department head is send to Procurement Manager and
Purchasers of procurement department make the purchase.

Store has categorized material in four labels

 Mechanical
 General
 Stationary

76
  General Electric

The documents/forms/reports used/generated in the department are:

 Purchase requisition slip

 Purchase order
 Receiving voucher
 Ledger (posting on ledger)
 Store return voucher
 Internal gate pass
 Temporary gate pass
 Permanent gate pass
 Daily activity report
 Daily stock taking report
 TOT report

ACCOUNTS DEPARTMENT
The job of the department is to maintain books of accounts. There are following
main activities of accounts.

 Issuance of purchase vouchers for raw material, plant and machinery

and general store items
 Check payment of payroll to employees including wages, overtime,
bonuses etc.
 Handling of monthly tax statements.

Computerized general ledger system is working and shows the result of

each transaction up to balance sheet and income/profit and loss statement.

EXCISE DEPARTMENT
DARE FOR MORE!
Shamim & Co is a regular taxpayer of excise and sales tax to govt. the
procedure is that production per hour of each plant is counted and noted in
cases and bottles. The excise duty and sales tax is calculated as per govt.
rate. The liquid stock of RG 1 is moved to DP godown after clearance and
daily deposit of sales tax. The company and all its dealers pay sales tax at
the end of each month. Sales tax and excise duty is also paid on some raw
material as sugar, crown caps, concentrate etc. the department maintains
following documents

77
  RG 1 register
 RG2 register
 AR 1 form
 Daily production report (shift bases)
 ACL register

The department is concerned with collector rate of central excise and sales
tax, production department, shipping department and MIS department.

POST MIX DEPARTMENT

The post mix department is responsible for installation, maintenance and filling
of fountain fresh (post mix) machine in eight districts of Multan franchise

Dispensing is today's "action package" carbonated soft drink in POST - MIX

and PREMIX forms, coupled with compact, high volume, refrigerated dispensing
equipment, represent convenience and increased profits for dealers and profit
opportunities for the bottler. There has been a little growth in the POST-MIX /
PRE-MIX dispensing area in the Pakistani Beverage Market until the 2004.
But now it has grown a lot due to the following factors.

Pressure on retailers to improve selling methods and techniques. Rapid increases in

the volume of soft drink consumption in outlets with storage remaining limited.

THE IMPORTANCE OF DISPENSING MARKET

DARE FOR MORE!

Dispensing market varies from country to in size and types of out let. The
title ON Premise identifies any out left where product can be purchased
with or without food for consumption on or near the premises.

The On-Premise market is one of the most markets in a Bottlers franchise.

Its importance in the continued growth and success of the Bottlers business
cannot be under estimated in its effects on:

78
 o Profitability
o Consumer awareness
o Consumer sampling
o Product Visibility
o Volume growth
o Chilled product sales
o Impact on take home sales

POST MIX MACHINE

Post Mix machine is U.S. made and it has following main components.

o Water bank
o Congesture
o Cooling system
o Walves
o Syrup tank(s)
o CO2 tank

Post Mix Department installs machine at any suitable place with the cash
security of Rs, 30000. Along with Post Mix machine, they also provide
counter, water tank, water filter(s), disposable glasses, disposable plates,

DARE FOR MORE!

machine maintenance and service. The cooling system is almost like
refrigerator or fridge cooling system.
However gas cylinders are attached to the machine for gas mixing. Syrup
and water mix-up happens in wolves at-4 C .So the customer gets fresh,
cool product in no time. The water used in fountain fresh machines is
acquired from locally available source, It is stored in water tank and filtered
once, twice or thrice depending on the purity of the water. With one syrup
tank of PEPSI, TEAM and 7-Up, equivalent of 19 cases standard bottle is

79
 obtained, While syrup cylinder of MIRINDA has the capacity of providing
equivalent of 16 cases standard product.

Until now total 118 has been installed in different districts and approx. 114
are working while others needs repair. There is further demand of about
100 machine

POST-MIX SYSTEM

The syrup mixed with water and CO2 at the customer account. POST-MIX
containers can be bifurcated in Transfer Tank.

The Post Mix system differs slightly in principle from the PRE-mix system.
The difference is related to the way the finished beverage is produced for
sale to the consumer. The bottle fill the beverage syrup into stainless steel
tanks at production plant and transport the tanks to retail outlets. The
operation of POST -MIX system is as follows.

Compressed CO2 Gas flows from the storage cylinder through gas a
pressure regulator where it is reduced to the working pressure of the
carbonator, then through a pressure relief valve and back flow check valve
to a juncture where the CO2 line gets divided. One segment going to
secondary regulators and the other to carbonators and the other to
carbonator tanks.

The flow of CO2 from the secondary regulators goes to the syrup
containers. Syrup flows from the containers to the refrigeration unit and

then to the dispensing valve. The CO2 gas directed to the carbonator
assembly enter a small capacity tank which contains potable water
automatically controlled to a predetermined level in addition to the tank. Its
safety valve, the carbonator assembly includes a motor driven water pump

DARE FOR MORE!

to force the potable water into the tank against the CO2 pressure. The

carbonated water from the carbonator .

Connect dispenser to a separate outlet. Turn power switch ON. Thoroughly

flush all incoming product lines before connecting them to the dispenser.
Turn on the water supply and allow the carbonator to fill completely.

Lift relief valve ring until water flows from relief valve openings. Relief’s
ring and allow closing.

80
 Turn on CO2 gas and adjust regulator to 75 psi.

Activate a valve until pump starts. Close valve and allow pump to cycle.
Dispense drinks from each valve to purge and remaining sanitizer from the
syrup lines and establish quality carbonation in the carbonator .

TRANSFER TANKS

The most common packaging from for both PRE-MIX and Post Mix
product is the Stainless Steel Tank. This tank comes as either a single entry
or double entry system. Each has specific advantages and disadvantages.
Both PRE-MIX and Post Mix product can be stored in either single or
double entry system

DOUBLE ENTRY TANKS

Double entry tanks have separate gas inlet and liquid outlet plugs. The
standard double entry tank size can hold 18 Liters of product. However the
double entry tanks are also available in other sizes.

SINGLE ENTRY TANK

The single entry tank is generally made of stainless steel and can be
obtained in different sizes. This tank is not commonly used for dispensing
soft drinks. To date its use has been within the brewing industry.

TANK AND CYLINDER REQUIREMENT

One question the reader will need to ask is the ratio between tanks and

DARE FOR MORE!

cylinders per units purchased. The answer is dependent on these factors:

 The length of distribution chains.

 The sales volume per outlet.
 The product Mix ( some flavors move faster than others )
 Frequency of calls.
 Control of stock levels.

EXAMPLE OF POST MIX TANK REQUIREMENT

81
 One product tank contains the equivalent of 19 standard cases of 250 ml
finished product, therefore an outlet selling 40 case per week would require the
following minimum stock to cover a basic four flavor installation.

TANKS
Outlet Machine Stock 4 Tanks
Outlet Reserve Stock 1 Tanks
Factory Shipping Stock 3 Tanks
Factory Production Filling 2 Tanks
Total: -10 Tanks

CO2 CYLINDERS
Outlet Machine Stock 1 Cylinder
Outlet Reserve Stock 1 Cylinder
Factory Stock 1 Cylinder

Total: - 3 Cylinders

DISPENSING DEPARTMENT STRUCTURE

In a simple way, the department can be considered to have four main
functions.

SALES
 Security Deposit Receipt.
 Legal Agreement papers.
 Installation site sheet


DARE FOR MORE!

Installation & pick up order .
 Quality control functions.

SERVICE
 Preventive maintenance card.
 Wastage Record.
 Complaints log.
 Spares usage Record

82
  Quality control & sanitation.
DELIVERY
 Delivery Card.
 Sales History Card Account Cash Record

WORKSHOP
 Daily sale & stock report
 Issue / Collection slip.
 Future needs Technical Development.
 Repair Section
 Store Section

POST MIX SALES OFFICER RESPONSIBILITIES.

1. Customer Service.
2. Conducting Annual surveys of accounts.
3. Preparing a sales plan for growth in conjunction with the Post
Mix Manager.
4. Grouping accounts into geographic routes for delivery
5. Helps in selection of sales man cum technicians.
6. New outlet development.
7. Existing outlet development.
8. Merchandising
9. Quality checking

OUTLET SELECTION
Dispensing equipment is very expensive and therefore every care must be
taken to ensure that the outlet have proper annual yield. As with any
installation of Post-Mix equipment, it is important to first undertake a site
survey. Until this is done it is not possible to ascertain the equipment

DARE FOR MORE!

required. The points that need to be checked are:

1. Volume through put.

2. Type of unit required & space for product tanks
3. Construction, alteration and other details.
4. Water and electrical requirements.
5. General Details and deliveries.
6. Proper space for air circulation.
7. Dealer and staff are trained or not.

83
 The machine is normally installed in parks, shopping centers, college
canteens, ice-cream parlors, busy roads, burger comers etc. The department
is having five vehicles for visits of each machine after every two days.
Different routes are planned in various areas. With every route/vehicle,
there is a technician, driver and helper. The purpose of the route is to
replace empty syrup tank, cleaning and maintenance work of machine and
resolve any complaint. Special routes are arranged in case of urgent
complaint or immediate syrup tank requirement. The technician also
performs the job of salesman. Cylinders are delivered on cash and it is
responsibility of technician to collect cash and later submit it at cash office.
During the route, they have to arrange their meal for which no allowance is
given. Technician s get a commission of Rs. 2.50 per cylinder sale.
Currently sales
Officer is incharge of the post mix department and performs his job as well.

Various forms/documents/reports used in the department are:

 Post Mix installation/removal orders
 Duty slip
 Overtime register
 Main store requisition
 Daily complaint register
 Daily technician report
 Part/outlet wise sales report
 Requisition for publicity
 Daily post mix report
 Individual technician files
 Party wise profiles

SUGGESTIONS
Fountain fresh department is an area which requires much more attention.
Though currently it is working with its capacity and covering five districts

DARE FOR MORE!

with a smart staff. The organization should take it as a SBU and concentrate
on it because of

 High expected growth

 PEPSI has currently no competition in this area
 No problem of empty
 It does not requires a huge plant setup and works with simple setup and very
low overhead
 No chance of fake bottle

84
 So the sales can be increased dramatically by better management and
boosting up Post Mix department.

PROBLEMS
There is job dissatisfaction and very low motivation on the staff due to:

 Low salary
 Daily allowance has been eliminated
 Overtime is rewarded in terms of holidays not in monetary terms. According to
technicians, they normally do not get a chance of making allowed vacations due
to workload so the extra holidays are of no use for them.
 Higher positions are filled from outside, people within the department should be
promoted to the chief technician and sales supervisor level.
 Technicians perform the responsibility of salesman for which they get just Rs.
2.50 per cylinder that is very low.
 Computer is present in the S.O. office but no one in the department is really
qualified to get use of it.
 Sales targets are set without the consent of staff.
 Post Mix staff has no knowledge of ISO.

During the route riding, I observed following points

 The key issue is proper and compatible combination of technician, helper and
driver . these people should work as a team in the field and must possess the
characteristics that make a team successful i.e. technical

competence, trust ----.

 The group should move with full preparation i.e. all required slips, necessary
tools, tested equipment.
 The vehicles must be fit and available on time. It is in their best interest and

DARE FOR MORE!

make their job safe, convenient and speedy.
 The new machines are not available for installation. Used machines and
counters make shopkeepers unhappy.
 The behavior of the staff with shopkeepers is generally good. The outlet
owners have the Post Mix office number complaints and the response is
efficient.

INVENTORY MANAGEMENT

85
Pepsi Cola Multan is handling four types of inventories which are

 RAW MATERIAL
Raw material like syrup, sugar, filter papers, CO2, Ammonia, Empty bottles,
packaging material, Bottle cases, Chlorine, Corks and Crowns etc.
 WORK IN PROCESS
Work in process will contain all those bottles which are under the process of the
filling and packaging. At the end of shift work in process inventory of is transferred
to other shift.
 END PRODUCTS
End products are in the form of cases containing 24 bottles. End product inventory
is managed in two ways
1. Production department after production stores their finished goods in their
godown which is located in the premises of factory.
2. Sales department transfer their needed inventory in their godown and issue
required amount of cases to distributors.
 SPARE PARTS
Spare parts inventory will contain items like Gear boxes, Belts or conveyers,
Motors and Switch boards etc.

TYPE OF INVENTORY
They are maintaining anticipation inventory but at very minimal level as products are

DARE FOR MORE!

not stored for a long-time period.

INVENTORY CONTROL SYSTEM

Pepsi Cola Multan follows periodic review system for inventory management. So
inventory is reviewed normally on weekly basis and some times after. Some time daily
reviews are also made. Each month the store prepares monthly consumption report.

86
REORDER POINT
Reorder point is calculated on two bases. Firstly they calculate the daily requirement of the
raw material and then they check the level in the stock room. For some items they maintain
the maximum and minimum level when the level of raw material touches the minimum
point they order the raw material. For two main items reorder points are as following
 Sugar is reordered when it is left for only 100-batched or 1000 Kg
 Concentrate is ordered for 2 to 3 times a year

LEVEL OF INVENTORY
Pepsi Multan maintains a low level of inventory because they face pressure for low level
inventory due to following factors

 Company wants to provide fresh products to its customers.

 Holding cost of inventory is high.

 High inventory causes high tax

SUPPLY CHAIN MANAGEMENT

DARE FOR MORE!

87
Supply-chain management aims at synchronization of a firm’s activities/ functions
and those of its suppliers to match the flow of materials, service and information
with customer demand.

SUPPLY CHAIN IN PEPSI COLA MULTAN

Supply chain of Pepsi Cola Multan consists of following entities

 Raw Material (From Suppliers)

 Pepsi Cola Multan (Production Of Products)

 Distributors

 Retailers

 Customers

Suppliers Pepsi Cola Distributors

Multan
Raw material Finished
Goods
Products
Direct Sales

Customer Retailer

Required

DARE FOR MORE!

Item

SUPPLIER SELECTION

88
The first priority is given to quality while selecting suppliers, by the Company. Price is
considered after quality & delivery time at last.

DISTRIBUTOR SELECTION
Distributors are selected on the following basis
 Ability to meet the given target
 Geographical area he is covering

RETAILER SELECTION
Retailer is selected on the following basis
 Location of the shop
 Look of the shop
 His know how with the customers
 His ability to meet the sales target

DIRECT SALES
Rural areas where there are no distributors, Pepsi Cola Multan goes for direct sales to
retailers. They offer the same price per unit as offered to distributors. In case of distributors,
for transportation truck are also available to transfer creates from company godowns to
distributor godowns.

SATELLITE WAREHOUSE
They are planning for satellite warehouses which will enable them to have flexible timings
for loading and unloading of trucks and storage of products closer to the customers.

DARE FOR MORE!

CAPACITY

89
Capacity is the max rate of output for a facility. The facility can be a workstation or an
entire organization.

CAPACITY IN PEPSI COLA

Pepsi Cola Multan measures its capacity in term of number of cases produced per day per
plant. All the cases including standard, non returnable, Liter and PET.

CAPACITY MEASUREMENTS

Average out put rate = 20,000

Maximum capacity or Peak capacity =

Effective capacity =

YEAR VISE PER PLANT CAPACITY

2004 (With Four Plants)

 Plant#1. Standard. Two fillers.(40+40) 22000 Cases/Day
 Plant#2. Standard and PET. 20000 Cases/Day and 16000 Packets.
 Plant#3. Liter 10000 Cases Nr 12000 Packets and Standard 14000 Cases.
 Plant#4. Standard 13500 Cases/Day
 Total capacity (Standard converted) 80000 Cases/Day.

2005 (With Addition Of Fifth Plant)

 Plant# 1. Standard 22000 Cases/Day.
 Plant# 2. Standard 20000 Cases & 16000 Packets PET/Day.
 Plant# 3. Liter 10000 Cases Nr 12000 Packets & Standard 13500 Cases /Day.

 DARE FOR MORE!
Plant# 4. Standard 13500 Cases /Day.
Plant# 5. (New Addition) 15000 packets. pet/day
 Total capacity (Standard converted) 100000 Cases/Day.

2006 (Projected With The Addition Of SIMONAZI Plant)

90
 Plant#1. 22000 Cases Standard.
 Plant#2. 20000 Cases Std. 16000 Packets Pet.
 Plant#3. 18000 Cases Lit. 20000 Packets Pet
 16000 Packets Nr 16500 Cases Standard (New addition of 80 filler and Rinser).
 Plant#4. Standard 13500 Cases/day.
 Plant#5. 15000 Packets PET/day.
 Plant#6. 100 valves SIMONAZZI complete line 57000 Cases Std/day.
 Total capacity (std. Converted) 165000 Cases/day.

DARE FOR MORE!

LOCATION

91
Pepsi Cola Multan is situated near MDA (Multan Development Authority), on the road
leading to Nishtar Hospital i.e. District Jail road.

SELECTION OF LOCATION
The major factor was proximity to markets in selection of location.

LOCATION ANALYSIS
The location described above is favorable for Pepsi Cola Multan due to following factors

 MARKET RELATED FACTOR

Pepsi Cola Multan has proximity to its major market i.e. Multan City which has
been declared by Pepsi Company; ‘The Pepsi City’ This location is very much
helpful for Pepsi Cola Multan, in competition also to maintain proper distribution
to reduce transportation cost & time etc.
 TANGIBLE FACTORS
Labor is easily available from villages & city at normal wages. No problem is
there for supply of electricity. Most essential raw material i.e. water is easily
available to them. Transportation cost is low. Multan is the center of their
distribution area and they can easily fulfill the requirements of the southern
Punjab areas.
 IN TANGIBLE FACTORS
Community attitude is positive towards Pepsi Cola. Working conditions are quite
good for employees i.e. No harm is there for their health & psychology.

PROBLEMS OF CURRENT LOCATION

DARE FOR MORE!

Factory is located in the residential areas with no proper parking arrangements for its
vehicles. Loading and unloading of trucks can take place only in the night because of the
law permitting trucks to enter into urban areas only in the night. So they can only load and
unload trucks between 10 PM to 6 AM.

92
SOLUTION
In order to overcome this problem they are planning for satellite warehouses which will
enable PEPSI to have flexible timings for loading and unloading of trucks and storage of
products closer to the customers.

LAYOUTS
Layout is physical arrangement of economic activity centers within a facility. An economic
activity centre can be anything that consumes space. In other works layout is physical
arrangement of people, equipment or activities.
APPLICATION IN PEPSI COLA MULTAN
Pepsi Cola Multan works with product layout type, as resources are arranged around the
product’s route. Computer application is also there in making layouts.
 PLANT LAYOUT
A single manufacturing plant consists of following different parts
1. Filler
2. Chiller
3. Washer
4. Crown fixer
5. Conveyer
All these parts should be arranged in a proper sequence to reduce the production
time. At first washed bottles are transferred to filler through the conveyer belt and
both filler and chiller are located at the same place in order to keep the filling liquid
cool at the time of filling.

DARE FOR MORE!

SOME MAIN LAYOUTS IN PEPSI COLA MULTAN
 Layouts of Equipment
 Manufacturing layout
 Office layout
 Retail layout
 Distribution & warehouse layouts

93
 PROJECTED FACILITY LAYOUT IN YEAR 2006

RESIDENTIAL AREA
SHAMIM & CO.(PVT.) LTD.
MULTAN.
2006

TURBINE
NO.2

SITE FOR
SIMONAZZI 100

RESIDENTIAL BOILERS
AREA TURBINE
PET NO.3
LINE

SYRUP
ROOM
EXTN.

AMMONIA
COMPRESSORS

M AIN ROAD TURBINE

NO.1

DARE FOR MORE!

94
 FORECASTING
In Pepsi Cola Multan, the base for forecasting is “precious data about sales”, which is
provided by sales department. After analyzing the data, the forecast is made. Executive
Opinion is also used in forecasting i.e. Opinions, experience & technical knowledge of
related managers. So forecasting in Pepsi Cola Multan is a blend of analysis of data &
executive opinion.

PATTERNS OF DEMAND
Demand for products of Pepsi Cola Multan follows Seasonal Pattern i.e. repeatable pattern
of increases or decreases in demand, depending on the time of season.

FACTORS AFFECTING DEMAND

There are two types of factor affecting the demand of the product which are internal and
external factors they are given below

 EXTERNAL FACTORS
Now-a-days, the biggest factor affecting demand of products of Pepsi Cola
Multan is the competitor’s action, the action/policies of Coca Cola Company e.g.
There effective advertising companies etc. Govt.’s rule & regulations about taxes
& prices also influence the demand by affecting the price of products.

 INTERNAL FACTORS
Some internal factors influencing the demand are given below
1. Price of product

DARE FOR MORE!

2. Proper advertisement
3. Good distribution channels

UNIT OF FORECASTING
In Pepsi Cola Multan forecast is made in term of cases where one crate = 24 bottles

95
DESIGN OF FORECASTING SYSTEM
In Pepsi Cola Multan forecast in made about all four products separately

TYPE OF FORECASTING TECHNIQUE

In Pepsi Cola Multan forecasting is made for short-term period i.e. for a quarter or 3-monts

DARE FOR MORE!

AGGREGATE PLANNING

96
Aggregate plan is a statement of production rates, work-force levels and inventory holdings
on estimates of customer requirements & capacity limitations. Since Pepsi Cola Multan is
a manufacturing co., so it’s aggregate plan is also called production plan.

UNIT OF AGGREGATION
Aggregate plan is expressed in terms of cases. Which are also called SKU (stock keeping
units)

STRATEGY FOR AGGREGATE PLANNING

Pepsi Cola Multan follows chase-strategy. As we know that demand-pattern for Pepsi Cola
Multan products is seasonal. So due to seasonality of demand and chasing of demand the
company follows the chase strategy

WORK FORCE ADJUSTMENT

Company has 2-types of employees:
 Employees at permanent basis.
 Employees at contract basis
All the permanent and contract basis employees are hired locally. No decision or strategies
are imposed by the country office in the hiring or firing of the employees. There are about
50 to 60 permanent employees which works through out the year. On the other hand

WORK-FORCE UTILIZATION
Work force utilization takes place in three forms

 Overtime
Normally there is not the tendency of over-time in Pepsi Cola Multan as

DARE FOR MORE!

management thinks that productivity of workers is reduced during over-time.

 Under Time
The permanent workers are also paid, the under time but the workers on contract-
basis are paid on the basis of working hours so under time is not paid to them.

 Vacation schedule

97
 Pepsi Cola Multan gives incentives for vacations in slack-season. Vacations are
given on the basis of labor-laws in Pakistan. Company does not adopt aggressive
alternatives, as co has not complementary products creative pricing

MATERIAL REQUIREMENT PLANNING

Material requirement planning system enables business to reduce inventory levels, utilize
labour and facilities batter and improved customer-service.
In Puts to MRP
1) Bill of material (BOM)
‘BOM’ is a record of all the components of an item, the parent component relationship and
usage quantities derived from engineering & process designs.
The simple ‘BOM’ for Pepsi Cola Multan’s product is as following.

1- Case of bottles

Case (1) Bottles (24)

Crown (24) Print ARTICLE I. Syrup

Returned Purchased

DARE FOR MORE! A R T I C L E I I . A R T I C L E I I I .Concentrate

UGAR AT E R
A R T I C L E I V.
THERS

End item = 1-case of bottle

98
Purchased items = raw material cases
Intermediate items = Bottles, Syrup
Sub-assemblies = Bottles, Syrup

2) Inventory Records
In inventory records, Pepsi Cola Multan, uses to order after variable periods of time and of
variable quantities, depending upon:
Item with highs load time is “Sugar”
Item with lowest load time is “ Co2
3) Master product Schedule (MPS)
MPS, details about production of end times items within specified period of time.
In Pepsi Cola Multan, MPSs are prepared normally on weekly basis.

DARE FOR MORE!

QUALITY CONTROL
It is quite clear that emphasis on the high quality is only thing to sustain in the market.

99
Quality is important due to following reasons:
 Product liability
 International liability
 Cost and market share

Regular sample picked by the representative of PCI in the factory and sent to America for
the analysis regarding to quality. These standards are:
Green Excellent
Yellow Good
Orange Satisfactory
Red Warning
Machinery maintenance is also checked. At this time Pepsi achieve the Green for the
standard.

RAW MATERIAL TESTING

Raw material used in production, comprises of following items.
 SUGAR
 TREATED WATER
 EMPTY WATER
 CARBON DIOXIDE
From the above items previously the franchiser from USA provided concentrate.

Following tests are made for the quality

 SUGAR TEST
 WATER TREAT MENT TESTING

DARE FOR MORE!

 SYRUP TESTING
 FINISHED PRODUCT TESTING

WATER TREATMENT

100
 Water is the main ingredient of the beverage product. Raw water is treated
so as to make it free of all impurities and use in the process.

WATER TESTS

Water Testing 2P-M Indicator Method:

The purpose of "2P-M" or " A " alkalinity test is to verify that water treatment
plant is operating correctly and final treated water for processing conforms
to standards. High alkalinity leads to undesirable effects. The frequency of
the test is after every half-hullr.

Total Dissolved Salts Testing In Water:

The purpose is to provide rapid, indirect evaluation of the total dissolved salts
in a water sample. The level of total dissolved salts is a useful measure to
gauge the overall consistency of the mineral contents in the water, which
ultimately effect the quality of beverage. The frequency of the test is after
every four hours.

Water Test Chlorine Residual:

Chlorine "residual" is the amount of chlorine that remains after the natural
chlorine demand of the water has been satisfied. Two fold purpose of the test
is:

1. Where chlorine is necessary , to demonstrate that the level of

chlorine present is adequate for water oxidation & disinfections purposes &

2. Where chlorine is prohibited, to confirm that it is absent.

DARE FOR MORE!

The frequency of test for water treatment is after an hour and for washer
final rinse is once in a shift.

Taste, Odor And Appearance: Treated Water:

The purpose of this test is to provide a rapid, gross evaluation of major

101
 defects in treated water for syrup & beverage making. In this test, the taste,
odor and appearance of treated water samples are assessed hourly.

Water Hardness Test:

The hardness in the water will affect the beverage quality as well as produce
scale in washers, boilers etc. water hardness is gradual decrease in the
tendency of water to form foam due to presence of impurities like chlorides,
soleplates etc.

SUGGESTIONS
Fountain fresh department is an area which requires much more attention.
Though currently it is working with its capacity and covering five districts with a
smart staff. The organization should take it as a SBU and concentrate on it because
of

 High expected growth

 PEPSI has currently no competition in this area
 No problem of empty
 It does not requires a huge plant setup and works with simple setup and very low
overhead
 No chance of fake bottle

So the sales can be increased dramatically by better management and

boosting up Post Mix department.

PROBLEMS
There is job dissatisfaction and very low motivation on the staff due to:

 Low salary

DARE FOR MORE!

 Daily allowance has been eliminated
 Overtime is rewarded in terms of holidays not in monetary terms. According to
technicians, they normally do not get a chance of making allowed vacations due to
workload so the extra holidays are of no use for them.
 Higher positions are filled from outside, people within the department should be

promoted to the chief technician and sales supervisor level.

 Technicians perform the responsibility of salesman for which they get just Rs. 2.50 per
cylinder that is very low.
 Computer is present in the S.O. office but no one in the department is really qualified

102
 to get use of it.
 Sales targets are set without the consent of staff.
 Post Mix staff has no knowledge of ISO.

During the route riding, I observed following points

 The key issue is proper and compatible combination of technician, helper and driver
. these people should work as a team in the field and must possess the characteristics
that make a team successful i.e. technical competence, trust ----.
 The group should move with full preparation i.e. all required slips, necessary tools,
tested equipment.

 The vehicles must be fit and available on time. It is in their best interest and make
their job safe, convenient and speedy.
 The new machines are not available for installation. Used machines and counters
make shopkeepers unhappy.
 The behavior of the staff with shopkeepers is generally good. The outlet owners
have the Post Mix office number complaints and the response is efficient.

RECOMMENDATIONS FOR THE COMPANY.

 Proper hierarchical system

The biggest problem we found in the organization was the lack of a

proper system, which is immensely important for such an organization.

This is a typical Pakistani family business where the owner is making the
decisions all the time.

DARE FOR MORE!

There is no succession planning, as it is apparent from the hiring of the
production manager from outside.

 Proper system of reporting

There was no proper system of communication as who is to report
to whom and who is responsible of what. If a simple technical worker

103
 encounters a problem in the plant or any part of the equipment is broken, he
at once rushes to the production manager as what to do. This is clear that
they have no proper reporting system as to deal with the broken part of the
equipment is not the job of the production manager.

There must be clearly defined levels of communication. The technical

worker must report to his immediate supervisor. If that supervisor is unable
to solve the problem then the official next to him should be consulted and
be proceeded in the same pattern. The matter will reach the production
manager but in a systematic way. So company needs a proper
communication and reporting system. It may also help in reducing rather
eliminating false reporting.

 Employee training
We see that when the new production manager was hired, he, for
implementing new techniques, gave lectures to the employees and also
recruited new ones. So there is lack of training of the employees in the
organization.

Generally Pepsi International has manuals for the managers that

describe the standard procedures and typically called as “THE PEPSI
WAY”. These are the guidelines, which must be passed on the employees
as how the work is to be done. What happened in the past is that the
managers kept hiding these manuals from the employees and placed them
under lock and key. The current production manager has taken an important

DARE FOR MORE!

step as he is preparing notes from these manuals and passing them on to the
employees. But still it is not enough. Because the plants of the factory work
in mistake at any process can cause a serious problem for the other plant,
which may lead to a severe mishap for the whole

production. So in this way the employee training has got the significant
importance.

104
For corrective action following steps lead to success for the organization:

 Periodic training programs

 Classes for unskilled persons
 Updating of skills of the employees.

 Performance appraisal
The performance appraisal system in a manufacturing organization
is a very tricky job. For example evaluating the performance of one shift
that has done the maintenance of the plant should be treated as separate from
the performance of the employees in the next shift that has got higher
production. The reason is that the second shift might be having less
efficiency than the previous one and the credit goes to the second shift.

The previous shift workers should be rewarded more than the next
shift because they had done the maintenance and kept the plant in working
condition. The second shift workers just have capitalized on the work of the
previous shift workers. That’s why the performance evaluation is very
important as it directly deals with the motivation of the employees. If the
employees feel that they have not been rewarded according to their jobs,
they may show little or no involvement in their tasks and may indulge in
activities that often hinders the efficiency of the production unit.

They mighty start

 Making groups
 Making false reporting

DARE FOR MORE!
Try to create obstacles for others
For this reason the company needs specific performance standards for
specific tasks.

 Employee Motivation

105
 Whenever someone talks about motivating the employees, it is
commonly said, “Don’t forget the money consideration”. So, apart from
motivation through training for the work, the employees must be rewarded
with proper reward and compensation systems.

The company is also lacking in this area. Getting rewards especially when
it is in the form of money or cash motivates the employees.

So we emphasize on proper reward and compensation system and a fair

level of salaries for all the employees in the factory. Salaries were stagnant
due to the stagnant production for the last 15 years. As the production has
gone up and it is just due to the employees so the salaries of the employees
must also be raised. Their commitment and involvement can be increased
by raising their salaries and rewards.

DARE FOR MORE!

106
 Thanks

DARE FOR MORE!

107