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LOVELY PROFESSIONAL UNIVERSITY
DEPARTMENT OF MANAGEMENT
Report on Summer Training
Consumer brand preference in soft drinks, juices
And
Packaged drinking water
Submitted to Lovely Professional University
In partial fulfillment of the
Requirements for the award of Degree of
Bachelors of Business Administration (Hons)
Submitted by:
Prerna Chauhan
7020070002
DEPARTMENT OF MANAGEMENT
LOVELY PROFESSIONAL UNIVERSITY
PHAGWARA
(2007-2010)
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TO WHOMSOEVER IT MAY CONCERN
This is to certify that the project report titled consumer brand preference in soft
drinks, juices and packaged drinking water carried out by Ms. Prerna chauhan, D/o
Mr. Kailash chander has been accomplished under my guidance & supervisionas a
duly registered BBA (Hons) student of the Department of Management, Lovely
Professional University, and Phagwara. This project is being submitted by her in the
partial fulfillment of the requirements for the award of the BBA(Hons) from Lovely
Professional University.
Her summer training represents her original work and is worthy of consideration for
the award of the degree of BBA (Hons)
___________________________________
(Name & Signature of the Faculty Advisor)
Title: ______________________________
Date: ______________________________
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DECLARATION
I,Prerna chauhan, hereby declare that the work presented herein is genuine work done
originally by me and has not been published or submitted elsewhere for the
requirement of a degree programme. Any literature, data or works done by others and
cited within this summer training project has been given due acknowledgement and
listed in the reference section.
_______________________
(Student's name & Signature)
_______________________
(Registration No.)
Date:__________________
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ACKNOWLEDGEMENT
It gives me immense gratification to place on records my profound gratitude andsincere appreciation to each and every one of those who have helped me in this
endeavor. I am ineffably indebted to my faculty guide Prof. Dr. Madhavi Pandya for
her most valuable and regular guidance without which my project would not have
been completed.
I extend my sincere thanks to Mr. Updeep Singh, Deputy General Manager, KandhariBeverages Pvt. Ltd.
Kandhari Beverages Pvt Ltd for his valuable suggestions throughoutthe project.
I am also very much thankful to Mr. Deepak Sohi, Area Sales Manager and for his
continuous motivation throughout this project, which really helped me in
completing the project. I would also like to thank the entire staff of Kandhari
Beverages Pvt Ltd,Chandigarh for their cooperation and support.
Any omission in this brief acknowledgement may not be taken as lack of
gratitude.
LOVELY PROFESSIONAL UNIVERSITY
DEPARTMENT OF MANAGEMENT
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CHAPTER NO. NAME PAGE NO.
1
1.1
1.2
introduction
introduction to
subject
review of
literature
1
2
3-11
2
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
2.10
2.11
2.12
2.13
Introduction to
industry and
organisation
Industry Profile
Company Profile
Manufacturing
process
History of Coca-
Cola
Milestone
Coca-Cola slogans
Product range of
company
Brands of Coca-
Cola India
Mission and
Vision
Financial data
Organizational
chart
12
13-19
20
21-25
27-28
29-35
36
37-39
40-42
43-44
45-46
47
48-51
52-53
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2.14
2.15
E-Commerece
Swot Analysis
Concept of RED
Kandhari
Beverages Pvt.Ltd
54
55
3
3.1
3.2
3.3
3.4
3.5
Project profile
Object of study
Research
methodology
Scope
Limitation
significance
56
57
57-58
58-59
59
59
4
4.1
4.2
4.3
Results of the
survey
Survey ineducational
institutes
Survey in shops
Survey of
packaged
drinking water
60
61-68
69-80
81-97
5 Conclusions and
recomendations
98-99
6 summary 100-101
7 Bibliography 102-103
8 Appendix 104
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CHAPTER 1
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INTRODUCTIONTO TOPIC
1.1 Introduction to subject
BRAND
A brand is a collection of experiences and associations connected with a service, a
person or any other entity.
Brands have become increasingly important components of culture and the economy,
now being described as "cultural accessories and personal philosophies".
BRAND PREFERENCE
Measure of brand loyalty in which a consumer will choose a particular brand in
presence of competing brands, but will accept substitutes if that brand is not available.
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FACTORS AFFECTING BRAND PREFERENCE
Advertisement
Availability
Visibility
Packaging
Taste
Companys image
1.2 LITERATURE REVIEW
Lansdowne, 2004 carried out research to explore Consumer perceptions of fruit juice
brands. This research identified that consumers perceived ambient juices to be of
variable quality, and NOT as healthy and natural as chilled juice. Chilled juice was
viewed as more authentic, better quality and above all healthier and more natural than
Ambient. Though there was also some consumer resistance to paying the premium
prices charged for chilled juices given the choice they would habitually consume
chilled juice but price was a barrier. Consumers dont always want to pay premium
prices for fresh chilled juices; much of the time they want a healthy juice at a
reasonable price. For most consumers, ambient juice was currently seen as a trade
down, as unexciting, undifferentiated and habitual; despite being 100% fruit juice.
Despite this consumers did tell us that Fruits tasted great. The agency therefore
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discovered that they needed to inform and reassure consumers of the fruit content and
real, natural, fruit credentials of Fruit-
American Journal of Lifestyle Medicine (AJLM), Published by SAGE, 2006 states
that When considering cancer and coronary heart disease prevention, there is no
evidence that pure fruit and vegetable juices are less beneficial than whole fruit and
vegetables. The researchers add that the positioning of juices as being nutritionally
inferior to whole fruits and vegetables in relationship to chronic disease development is
unjustified and that policy which suggest otherwise about fruit and vegetable juices
should be re-examined. The researchers who authored the paper Can pure fruit and
vegetable juices protect against cancer and cardiovascular disease, too? A review of theevidence suggests that more studies in certain area are needed to bolster their findings.
Although this independent review of the literature is not designed to focus on any
particular 100 percent juice, it does go a long way in demonstrating that fruit and
vegetable juices do play an important role in reducing the risk of various diseases,
especially cancer and cardiovascular heart disease, says Sue Taylor, RD, with the
Juice Products Association, a non-profit organization not associated.
Kassem, Lee, Modeste and Johnston , 2005. This study identified factors that
influence regular soda consumptionamong 707 female students, aged 1318 years,
attendingNorth Los Angeles County public high schools. Participants completeda
group-administered Theory of Planned Behavior-based questionnaire.Almost all of the
participants, 96.3%, reported that they currentlydrink soda; 50.1% reported drinking 2
glasses of soda or moreper day during the past year. Students reported drinking regular
soda more than diet soda and reported drinking phosphoric acid-containingsoda more
than non-phosphoric acid-containing soda. Attitude,subjective norm and perceived
behavioral control had statisticallysignificant positive associations with intention, and
were eachsignificant predictors of intention to drink regular soda andtogether10
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explained 64% of its variance. The strongest predictorwas attitude, followed by
perceived behavioral control and subjectivenorm. Our results suggest that efforts to
reduce soda consumptionamong female adolescents should include parents and friends.
It is also important that soda should not be excessively available at home or widely
accessible to teenagers at schools. Healthyeating messages for adolescents need to be
developed and incorporatedinto existing and future campaigns to reinforce the
perceptionthat there are other healthier drinks that quench thirst andthat taste good as
well.
With consumers showing a growing preference for healthier soft drinks such as bottled
water and fruit/vegetable juice rather than carbonates in 2007, the two carbonates
giants suffered a marginal decline in share. Although both players embarked on a
change in strategy to focus more on non-carbonated soft drinks in their portfolios, they
were unable to maintain share and lost out slightly to home-grown players Parle Bisleri
and Dabur India. Coca-Cola India launched Minute Maid and pushed the sales of its
juices while PepsiCo India heavily promoted Tropicana, Aquafina and Gatorade during
2007. In addition, Coca-Cola India and PepsiCo India embarked on re-branding
themselves as total beverage players and not just carbonates players.
Wu, Juanjuan; Delong, Marilyn To provide marketing and managerial insights to western
companies selling denim jeans in China, specifically in Shanghai. Understanding
consumers' perceptions of Western-branded jeans in a cultural-specific marketplace is the
primary focus. Design/methodology/approach - Combined methods included observation of
shoppers wearing jeans in two malls in Shanghai and an anonymous survey. A total of 219
surveys were analyzed and consumer-perceived jeans attributes or related concepts were
tabulated. Findings - About one third of the observed shoppers were wearing jeans, which
signified a relatively high popularity of jeans as casual wear in Shanghai. The design and
fashion of jeans were deemed highly critical but were superseded by comfort and fit.
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Shanghai consumers distinguished brand origins only between the West and the East
instead of by specific countries. Dissatisfaction with price and fit were identified.
Bristow, Schneider, Schuler The marketing literature provides substantial discussion of
branding and brand equity, but reveals limited research on the use of brand name in theconsumer decision-making process. Further, most such studies have included the
manipulation of product brand name as an independent variable. The primary objective in
this study was to address that lack of attention to consumers use of brand names by
developing and empirically testing a multi-item scale called the brand dependence scale
(BDS). The psychometric properties of the scale were assessed and the relationship between
brand dependence and brand disparity was explored. The results of the study showed that
the BDS demonstrated adequate internal reliability and that a significant positive
relationship between brand dependence and brand disparity existed. Implications of the
study results and managerial applications for the scale are discussed.
Auty, Elliot After many years as a stepchild to the specialty coffee market, tea is taking
off in the United States. The trend is fueled by good news about the health benefits of
drinking tea, by new products and appealing packaging, by an interest in alternatives to
coffee or soda, and by lifestyles that embrace both the luxury/ritual aspect of tea and the
convenience of new bottled and ready-to-drink teas.
Packaged Facts new report, The U.S. Market for Tea and Ready-to-Drink Tea, 2nd Edition,
explores teas new prominence and the impact on the market and the consumer psyche.
As the market grows, its also becoming much more segmented and competitive. Where
black tea was once the predominant choice available on supermarket shelves, there are now
many varieties, each with particular health and flavor aspects. These include green tea,
white tea, red tea, herbal tea, medicinal tea, chai, yerba mate, and blends of all the above.
Tea drinkers can now truly be tea connoisseurs, using different teas for different occasions,
just as with wine or specialty coffees. Many small companies are serving this market,
setting up the possibility of future merger and consolidation activity.
The growing popularity of tea is reflected in the foodservice arena, where tea houses
are luring former coffeehouse customers with a calmer, more serene ambience.
Because tea is a global and agricultural commodity, theres also interest in organic tea
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production and labels such as "fair trade" that ensure a socially responsible purchasing
system.
Madan, Suri After a somewhat subdued performance in 2006 due to a recurrence
of the pesticides controversy, soft drinks sales bounced back strongly to record double-digit volume growth in 2007. With carbonates growth back on a positive upward curve
alongside burgeoning sales of fruit/vegetable juice and bottles water, soft drinks
showed impressive growth in 2007. Off-trade volumes grew slightly faster than on-
trade volumes, driven by higher consumption of packaged and branded soft drinks at
home and on the go. The emergence of supermarkets/hypermarkets, heavy consumer
promotions and various new product launches played a key role in driving off-trade
volume growth.
Bristow, Schneider, SchulerSoft drinks sales in 2007 were propelled by bottled
water and fruit/vegetable juice with their healthier positioning helping to drive sales of
soft drinks. While carbonates posted single-digit growth in 2007, rebounding from the
pesticides controversy of 2006, it was bottled water and fruit/vegetable juice that
stormed ahead with high double-digit growth rates. Poor municipal infrastructure for
tap water has pushed sales of bulk packaged water to households. Fruit/vegetable juice
is growing as a result of increased consumer expenditure on naturally healthy (NH)
beverages. While functional drinks and RTD tea also posted impressive growth in
2007, they were growing from a very small base and are yet to achieve a critical mass
in terms of establishing a loyal consumer base.
Anurada nayak, April 2007 (As a part of internship program
regarding consumption of juice through Christ College, Bangalore)a
consumer sampling involving 5.5 lakh people revealed that.
The approximate age of the consumers was to be guessed and noted down. Around
50% of consumers fall in the 25 years to 35 years and 35 years to 45 years age groups
and the other 50% is distributed among the other age groups. More than half the people
who tasted the product liked the product, i.e. they gave positive feedback about the
product and 15% of the consumers did not like the product. Out of the remaining 19%
of consumers, 11% people came up with mixed reactions i.e. they had reasons both to
like and dislike the product and a small chunk of 8% of the total consumers sampled13
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with, said they did not like the drink too much, neither did they love the drink. Males
and females have the same kind of reaction towards the product. About 70% of the
both males and females liked the product. This may be due to the fact that juice is a
universal favorite and people across the world, across both genders love having orange
juice. Around 20% of both males and females gave an average rating to the products
and the rest were confused.
Price waterhousecoopers prepared for Indian brand equity foundation (IBEF),
Udiyod vihar gurgaon) Cola major, Coke, brought down the average price of its
products from around twenty cents to ten cents, therefore bridging the gap between soft
drinks and other local options like tea, butter milk or lemon juice. It also doubled the
number of outlets in rural areas from 80,000 during 2001 to 160,000 the next year,thereby almost doubling its market Penetration from13 per cent to 25 per cent. This
along with greater marketing, led to the rural market accounting for 80 per cent of new
Coke drinkers and 30 per cent of its total volumes the rural market for colas grew at 37
per cent in 2002, against a 24 per cent growth in urban areas. The per capita
consumption in rural areas also doubled during 2000-02.
BHU ban on cola drinks a godsend for fruit-sellers (Cronicle article,
2007) the administration of the Asia's biggest residential varsity has from August one
last banned the consumption, sale and availability of junk food, cola and carbonated
drinks, besides all types of tobacco products in pursuance of a University Grants
Commission (UGC) directive. ''Acting on a UGC directive circular was issued by the
BHU registrar Natrajan Sunderam on July 25 last to ban the consumption and sale of
cold drinks on both North and South campus of the university at Varanasi and
Mirzapur respectively. We are consulting experts at the Law Faculty to cancel the cola
selling licenses of shops and canteens selling carbonated drinks on the varsity campus
as well as schools and colleges affiliated to BHU,'' Chairman of BHU Press,
Publication and Publicity Cell chief Rajesh Singh said here today. The ban on
consumption and sale of junk food, carbonated/cola drinks as well as tobacco products
was imposed by BHU in pursuance with a UGC directive prompted by Union Health
and Family Welfare ministry observations that growing consumption of such products
among young and adolescent population in schools and colleges is contributing to the
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growth of chronic degenerative non-communicable diseases such as obesity,
hypertension, cardio-vascular problems, diabetes, stroke and cancer.
J Parker soft drinks is expected to post a strong performance on the back of increasing
affluence amongst consumers and evolving lifestyles which lead to consumers devoting
less time to preparing fresh food and drink at home. Competition from the unorganised
sector will diminish gradually as consumers show greater aversion to buying
unpackaged and unbranded soft drinks from street vendors due to health and hygiene
concerns. Rising health consciousness is also expected to drive sales of naturally
healthy (NH) soft drinks such as 100% juice and mineral water. In addition, soft drinks
such as sports drinks and juice-based carbonates are also expected to fare well over the
forecast period as consumers perceive them to be healthy. (PoS) displays and gift
packs of concentrates are also drawing consumer attention in
supermarkets/hypermarkets.
Brandon F. Greene, Mark Rouse, Richard B. Green, and Connie Clay Control of
market share is the key issue in this study. The situation is both Coke and Pepsi
are trying to gain market share in this beverage market, which is valued at over $30
billion a year. Just how this is done in such a competitive market is the underlying
issue. The facts are that each company is coming up with new products and ideas inorder to increase their market share. The creativity and effectiveness of each
company's marketing strategy will ultimately determine the winner with respect to
sales, profits, and customer loyalty. Not only are these two companies constructing
new ways to sell Coke and Pepsi, but they are also thinking of ways in which to
increase market share in other beverage categories. Although the goal of both
companies is exactly the same, the two companies rely on somewhat different
marketing strategies. Both companies have also relied on finding new markets,
especially in foreign countries. In the foreign markets, Coke has been more
successful than Pepsi. For example, in Eastern Europe, Pepsi has relied on a barter
system that proved to fail. However, in certain countries that allow direct comparison,
Pepsi has beat Coke. In foreign markets, both companies have followed the marketing
concept by offering products that meet consumer needs in order to gain market share.
Both companies cannot just sell one product; if they do they will not succeed. They
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have to always be creating and updating their marketing plans and products.
The Companies must be willing to accommodate their target markets. Gaining
market share occurs when a company stays one-step ahead of the competition by
knowing what the consumer wants. Apart from this study previous studies were based
on the distribution network and market share of some of these beverages companies.
This study is based on to find out the market share of coca-cola in some of the areas of
Kanpur city.
Christoph Wappler Pepsi is often second to Coke in terms of sales, but outsells
Coca-Cola in some localities. Around the world, some local brands do compete with
Coke. In I n d ia, Coca-Cola ranked third behind the leader, Pepsi-Cola, and local drink
T h u m s U p . However, T h e C o c a - C o la C o m p a ny Purchased T h u m s Up in 1993. As of
2004, Coca-Cola held a 60.9% market- share in India. T r o p ic o la, a domestic drink, is
served in C u b a instead of Coca-Cola, in which there exists a United States embargo.
M ecc a C o la annd Q ib la C o la , in the M id d le east , is a competitor to Coca-Cola. In
T u r k e y , C o la T u r k is a major competitor to Coca- Cola. In Ir a n annd also many
countries of Middle East, Z a m Z a m C o la annd P a r s i C o la are major competitors to
Coca-Cola. Coca-Cola Co. slightly increased its lead over rival Pepsi-Cola Co. in
2002, thanks to the successful launch of Vanilla Coke and the growth of Diet Coke,
according to U.S. soft drink industry rankings released last week. Coke gained 0.6
percentage points in market share and increased its case volume by 2.1 percent,
according to Beverage Digest/Maxwell, a New York-based industry newsletter and
data service. The company captured a larger share of the market even though its
Coke Classic brand fell 0.6 percentage points in market share. Coca-Cola dominates
44.3 percent of the U.S. soft drink market, but saw its market share drop between
1999 and
2001. With the latest gains, it's only 0.2 percentage points away from where itstood in
1998 at 44.5. Pepsi-Cola lost 0.2 percentage points in market share. The No. 2
company commands 31.4 percent of the U.S. soft drink market.
Grobler & Herbst In 1990, when Indian government opened the market to
multinationals, Pepsi was the first to come in. Thums Up went up against the
16
http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Thums_Uphttp://en.wikipedia.org/wiki/The_Coca-Cola_Companyhttp://en.wikipedia.org/wiki/Thums_Uphttp://en.wikipedia.org/w/index.php?title=Tropicola&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Tropicola&action=edit&redlink=1http://en.wikipedia.org/wiki/Cubahttp://en.wikipedia.org/wiki/Mecca_Colahttp://en.wikipedia.org/wiki/Qibla_Colahttp://en.wikipedia.org/wiki/Middle_Easthttp://en.wikipedia.org/wiki/Turkeyhttp://en.wikipedia.org/wiki/Iranhttp://en.wikipedia.org/wiki/Zam_Zam_Colahttp://en.wikipedia.org/wiki/Parsi_Colahttp://en.wikipedia.org/wiki/Thums_Uphttp://en.wikipedia.org/wiki/The_Coca-Cola_Companyhttp://en.wikipedia.org/wiki/The_Coca-Cola_Companyhttp://en.wikipedia.org/wiki/Thums_Uphttp://en.wikipedia.org/w/index.php?title=Tropicola&action=edit&redlink=1http://en.wikipedia.org/wiki/Cubahttp://en.wikipedia.org/wiki/Mecca_Colahttp://en.wikipedia.org/wiki/Qibla_Colahttp://en.wikipedia.org/wiki/Middle_Easthttp://en.wikipedia.org/wiki/Turkeyhttp://en.wikipedia.org/wiki/Iranhttp://en.wikipedia.org/wiki/Zam_Zam_Colahttp://en.wikipedia.org/wiki/Parsi_Colahttp://en.wikipedia.org/wiki/India8/9/2019 Major Project Summer Training
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international giant for an intense onslaught with neither side giving any quarter.
With Pepsi roping in major Indian movie stars like Juhi Chawla, to thwart the
Indian brand, Thums Up increased its spending in the Cricket sponsorship. Then the
capacity went from 250ml to 300ml, aptly named MahaCola. This nickname gained
popularity in smaller towns where people would ask for "Maha Cola" instead of
Thums Up. The consumers were divided where some felt the
Pepsis mild taste was ratherbland .
In 1993 C o ca - C o la re-entered I n d ia after prolonged absences from 1977 to 1993. But
Coca-Colas entry made things even more complicated and the fight became a three-
way battle. That same year, in a move that baffled many, Parle sold out to Coke for
a meager
US$ 60 million (considering the market share it had). Some assumed P a r le had lost
the appetite for a fight against the two largest cola brands; others surmised that the
international brands seemingly endless cash reserves psyched-out Parle. Either
way, it was now Coca-Colas, and Coke has a habit of killing brands in its portfolio
that might overshadow it. Coca-Cola soon introduced its cola in cans which was
all the rage in India, with Thums Up introduced alongside, albeit in minuscule
numbers. Later Coca- Cola started pulling out the Thums Up brand which at that
time still had more than 30% market share
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http://en.wikipedia.org/wiki/Coca-Colahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Parlehttp://en.wikipedia.org/wiki/Coca-Colahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Parle8/9/2019 Major Project Summer Training
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CHAPTER-2
INTRODUCTION TO
INDUSTRY
AND
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ORGANISATION
2.1 INDUSTRY PROFILE
Indias one billion people, growing middle class, and low per capita consumption ofsoft drinks made it a highly contested prize in the global CSD market in the early
twenty-first century. Ten percent of the countrys population lived in urbanareas or
large cities and drank ten bottles of soda per year while the vast remainder
lived in rural areas, villages, and small towns where annual per capita
consumption was less than four bottles. Coke and Pepsi dominated the market and
together had a consolidated market share above 95%. While soft drinks were once
considered products only for the affluent, by 2003 91% of sales were made to thelower, middle and upper middle classes. Soft drink sales in India grew 76%
between 1998 and 2002, from 5,670 million bottles to over 10,000 million (See
Exhibit 6) and were expected to grow at least 10% per year through 2012.28 In spite
of this growth, annual per capita consumption was only 6 bottles versus 17 in Pakistan,
73 in Thailand, 173 in the Philippines and 800 in the United States29. With its large
population and low consumption, the rural market represented a significant
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opportunity for penetration and a critical battleground for market dominance. In 2001,
Coca-Cola recognized that to compete with traditional refreshments including lemon
water, green coconut water, fruit juices, tea, and lassi, competitive pricing was
essential. In response, Coke launched a smaller bottle priced at almost 50% of the
traditional package.
Carbonated Soft Drinks
At the core of the beverage industry is the carbonated soft-drink category. The
dominant players in this area (Coca Cola, Pepsi, and Schweppes) own virtually all
ofth eNorth American markets most widely distributed and best- known brands. They
are dominant in world markets as well. These companiesproducts occupy largeportions of any supermarketsshelf space, oftencovering more territory than real foodcategories like dairy products, meat, or produce. As with many mature retail industries,
the beverage giants have a problem growth in the sales of their flagship carbonated
products are at a near standstill in the key
U.S. market, with 1% growth or less. After years of rapid growth, it seems that th e
average American cant drink any more flavored, fizzy soda water. T o remedythat,
these three companies are rapidly expanding both globally as they enter and
promote new markets for existing products and locally, as they add products from
adjacent beverage categories in the supermarket, in categories that are still
expanding. We'll talk about these areas in a later posting.
The prototype of all marketing and branding struggles, the Cola Wars keep
expanding. The Pepsi and Coca Cola keep rolling out the big guns: dueling pop stars,
and new branded products in the form of Vanilla Coke andPepsiBlue. They are
fighting on the TV, in the fast-food restaurants, and in the supermarkets; they are also
dueling in the schools. One of the biggest pushes of the last few years has been
convincing school districts, universities, and other institutions to go all-Coke or all-
Pepsi, in return for a (small) cut of the gross sales.
Selling costly sugared water and building an increasing demand for it, even in
Third World countries, involves marketing in its purest form, unsullied by any
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preexisting need or local tradition. Markets in Eastern Europe, China, India, and
Mexico, among others, are expanding fast, and both Coke and Pepsi are finding local
partners (bottlers) in these countries to keep extending their reach. And while the
American market may be mature, theresstill anopportunity worldwideto replace hot
beverages like coffee and tea that require some preparation with these cold, iconic.
All this worldwide activity cant disguise an unpleasant core reality for the
vendors: U.S. carbonated soft drink sales increased only 0.5% in the year 2002.
Although total sales for the industry was up slightly, per capita consumption was
down for the third year in a row In other words, domestic soft drink growth is not
keeping pace with population growth
Overall soda market
In fact, Coke and Pepsi have a third major rival on the bottled soft drink shelves,
namely Cadbury-Schweppes. The big three carbonated beverage makers now exist in a
stable oligopoly those changes only by small increments and which controls over 90%
of the market. Over the years, Cadbury-Schweppes (the result of a merger
between a British candy company and a British beverage company) has improved
its position by acquiring key brands in the US, namely Dr. Pepper and Seven-Up,
along with A & W and Canada Dry.
In past decades, the carbonated beverage section had been the beneficiary of an
amazing record of growth, where consumption has more than doubled over the
past 25 years. Americans consume twice as much soda as they did 25 years ago, up
from 22 gallons per person per year to over 56.
In 2000, these three companies had almost exactly the same share of the U.S. market
they had in 1999, namely:
Company Percentage Brands
Coca Cola 44.1% Coke, Sprite, Barq, Fanta, Mello Yellow, etc.
PepsiCo 31.4% Pepsi, Mountain Dew, Mug, Slice, etc.
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While individual flavors go up and down, the relative market share of the big three
changes at a glacial rate. The next biggest North American soda company, the
Canadian-based Cott Beverage Company, had only a little over 3% of the market and
that company specialize in supplying private label soda to supermarkets and other
chains.
In 2001, however, Cadbury acquired moribund RC Cola, giving it a cola drink to
battle against the big guys. This gave the company more shelf position and
immediately gave the RC Cola brand, long a distant also-ran with weak marketing
muscles, more sales and market presence. Pepsi gave itself a small boost because of
the popularity of newly introduced Mountain Dew Code Red, a hyper-caffeinated soda. Cokes numbers declined slightly.
The market share figures in 2001.
Company Percentage
Coca Cola 43.7%
PepsiCo 31.6%Cadbury/Schweppe 15.8%
Its pretty indicative of this mature market that the only major move in market share
comes through a takeover. Moreover, the takeover targets that are left are so small that
the biggest remaining brand doesnt make more than 1% difference in total volume
New age beverages
In the last part of our look at the beverage business, we noted that oligopolies
Coca Cola, PepsiCo, and Cadbury Schweppes had "flooded" a mature market, so that
there was minimal growth potential in the carbonated beverages category. So, how
can these companies grow, something all oligopolies are compelled to do? First,
by expanding internationally. Second, by acquiring or adding new products in
other beverage areas, which show both faster growth and less well- defined
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competition. In fact, other beverage types have only in the last decade come into
focus as separate, important categories. So the search for new beverage footholds has
become the second front of the Cola Wars. There is a scramble for new territories in
beverage shelf space, and Coke and Pepsi are investing heavily.
These a l t e r n a t i ve beve r ag es a r eas were e s t ab l i s he d by s t a r t up o r
s m a l l c a p companies, including Snapple and Arizona Iced Teas, Ocean Spray and
Nantucket Nectars, SoBe and Calistoga. The emerging categories began to look like
both a threat and an opportunity for the big three. In 2001, according to Beverage
Age Magazine. The segments of alternative or "New Age" beverages ranked by
order of sales, were:
Bottled water in clear plastic containers
Mildly flavored water (Clearly Canadian, Veryfine, Acqua Vie)
Fruit juices and drinks (some shelf-stable, like Ocean Spray, Mott's, DelMonte;
some refrigerated, like Nantucket Nectars, Tropicana)
Sports and energy drinks (Gatorade. Powerade, SoBE Power, Red Bull, G- Up)
Iced tea (Snapple, Arizona, Lipton,Nestea) Premium soda (Thomas Kemper Soda,
Jones Soda)
Cold coffee drinks (Starbucks cappuccino drinks, PlanetJava, Arizona)
Vegetable/fruit juice blends, (V8, Odwalla)
Enhanced dairy drinks (Smooth Moos, Chocolate Moose Energy Shakes, drinkable
yogurt)
Soy-based and other non-dairy beverages (Odwalla, Health Source)
Other nutrient-enhanced beverages, so called nutriceutical beverages
(SoBe, Hansen, Naked Juice, Fresh Samantha).
The problem with this market, like most emerging categories in the grocery
business, is an excess of vendors and products, making it hard for retailers to
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decide who to assign their precious shelf space to. This is accompanied with an even
larger number of SKUs of different sizes and flavors, causing generally chaos in
the market. That makes for a great opportunity for the oligopolies, which have
entered into these markets in a big way.
Bottled Water
The bottled water industry in North America is growing aggressively. It is the fastest
growing segment in the beverage industry (around 30% annually, compared to 1% or
so in carbonated beverages), and the cost of goods sold is almost negligible. Once
confined to Perrier and Evian sippers at fancy restaurants or people with bad--tasting
local tap water, there's been a tripling of US consumption since 1985. As a recent
FORTUNEmagazine article put it,
The most brutal battle in the beverage industry is the one for dominance of bottled
water. With the niche growing at a 30% annual clip, bottled water will likely catapult
ahead of coffee and beer to become the second-best-selling beverage--just behind soft
drinks--by 2005. (Currently bottled water's barely ahead of No. 5 milk).
Another article in Beverage Marketing notes the concentration of the market as water
gets to be a bigger deal.
Super marketers have revolutionizing the industry. Since the costs of buying and
holding shelf space is so expensive, the small, regional firms, which used to be major
water suppliers, are being priced out. The only companies that can get their products
on the shelves are the new water oligopolists, large national and multinational
companies. Four companies now dominate the North American market for bottles
water: Nestle, Danone, Coca Cola, and Pepsico.
Like other areas of the beverage market, water, once the province of small, local
spring bottlers and a few European importers, has now become an oligopoly.
While Nestle (originally a Swiss chocolate company) and Danone (originally a French
dairy firm) have been in the market for a while, Pepsi and Coke are Johnnies-come-
lately to the market, Pepsi in 1995 and Coca Cola in 1999. But they have so much
marketing savvy, power in the distribution and bottling area, and store presence, that
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selling brands in the US market. That's in spite of the fact that, unlike most of the
competitors, these are simply filtered and bottled local tap water. Yet bottles of the
either of these essentially free liquids sell for almost the same a similar container of
soda or iced tea. Not a bad business to be in!
Both companies use their vast experience in associating drinks with lifestyle,
sharpened during the cola wars. They are ramping up their ad budgets and getting
significant growth in volume as they do so. And they have a big opportunity.
According to estimates, one third of American households have never tried bottled
water, and carrying around a bottle of water has become a status symbol for many
younger Americans.
Nestle is in fact the overall market leader, with $2.5 billion overall in water sales. It
sells a number of brands that are popular in various regions of the country, such as
Poland Spring in the Northeast. Arrowhead and Calistoga in California, and so on.
These are actual spring waters that have to be trucked to the bottler. Nestle also
sells Perrier, San Pelligrino, and some other European imports.Danone is number four
in volume, with its imported Evian, Volvic, and others, along with Naya and
Sparkletts from the U.S. Of the big four, Danone is the one that is sinking, losing sales
to the others. In fact, they just signed an agreement with Coca Cola to market and
distribute several of its brands in the US, including Dannon and Sparkletts, and
some economy brands. Evian and other European brands will not be affected.
In 2002, these four companies had achieved over 60% of the water sales in the US, and
that was rapidly expanding. Only two competitors have shares over 2%: Suntory
Group (part of a Japanese conglomerate) and independent Crystal Geyser. Our guess is
that minor brands will more and more be crowded off the shelf. (By the way, Cadbury-
Schweppes has a limited water role at present.)
Supermarket sales of cases of water are starting to show competition, as Nestle, Coke,
and Pepsi are starting to compete on price as a Wall Street Journalreport noted. Coke
and Pepsi are trying to avoid a water version of the cola wars, in which they
battled it out with price, cuts in the supermarket aisle. That's why they're
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concentrating some 60% to 70% of their sales in the lucrative business of selling
single, cold bottles in But the next step is differentiating waters by making them
vitamin-enriched nutriceutucals. Pepsi, through its Gatorade subsidiary, now offers
Propel, enhanced with vitamins and minerals. It is also selling something called
Aquarian Essentials, which is flavored water (some sugar added), doubtless a healthy
drink. Coke is selling Dasani Nutriwater, a similar gimmick. Even the water category,
only recently discovered by these companies, is now spawn new categories, opening
new fronts in the cola wars.
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2.2 COMPANY PROFILE
Headquarters: One Coca-Cola PlazaAtlanta, GA 30313Employees: 71,000CEO: Muhtar KentStock Symbol: KO
Website: http://www. coca -cola. co m
Coca-Cola is the world's leading beverage company. The company is the world's
leading manufacturer, marketer, and distributor of nonalcoholic beverage
concentrates and syrups, used to produce nearly 400 beverage brands.
The company makes and distributes sodas, waters, fruit juice, teas and coffees and
energy drinks. Through the world's largest beverage distribution system, consumers
in more than 200 countries drink the company's beverages at a rate exceeding 1.5
billion servings each day.
Major brands include Coke, Diet Coke, Sprite, Bacardi, A&W, Minute Maid, Dasani,Nestea, Powerade and Hi C.
In 2007, revenues were $28.8 billion, a 20% increase from the previous year, and net
income was $5.9 billion. Unit volume increased 6%.
In 2007, the company said it will acquire Energy Brands, Inc., known as glacau, and
its full range of fast-growing, enhanced water brands, including Vitamin Water for
$4.1 billion.
Coca-Cola announced in September it is investing more than $60 million to build the
world's largest plastic-bottle-to-bottle recycling plant and support recycling in the
U.S. These investments are part of a comprehensive goal to recycle or reuse 100
percent of the Company's plastic bottles in the U.S.
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2.3 MFG. PROCESS OF COCA-COLA PRODUCTS
INGREDIENT DELIVERY
Sweetener
Team of professionals, work on selecting, auditing, sampling, testing, approving and
then authorizing the sugar suppliers and the list of such authorized suppliers with
approved sugar lots and along with the certificate of analysis are sent across to all the
bottling unit for procurement.
Secret Formula
Created in special concentrate plants, it's delivered, held and used under strict
controls to maintain its integrity and security. Each unit of concentra te is
especially identifiable to allow the "history" of each component to be researched at any
stage of production, storage or use.
CO2 Formula
When delivered to the plant, carbon dioxide, or CO2, comes in cylinders for easy
delivery and storage. But what is it? In essence, it's a colorless and odorless gas that
provides the fizz for our beverages. But its also a by-product of our breathing
and used by plants and trees to produce oxygen.
Water
Since water is a key component to all our beverages, its quality is critical. And,
since public water quality varies around the world, each plant further treats the water it
uses. This means that before water is added to any of our beverages; it's rigorously
filtered and cleansed. We then continuously sample the water to ensure it meet our
standards.
Materials
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Ingredients are not the only things delivered to the plant. Other materials such as
Bottles, cans, labels and packaging are also delivered. Our plants in India use
refillable bottles, CANS, PET etc. in the Production Process, when bottles and
cans are delivered to the plant; they are carefully inspected to ensure that theymeet our exacting standards. Once these have passed initial inspection, they move on
to be washed and/or rinsed.
WASHING AND RINSING
To ensure quality, each bottle is washed, sanitized and rinsed before being filled.
While this sounds simple, the actual steps can differ by bottling plant. In India, our
plants use refillable glass, cans or PET bottles. To ensure they meet our
cleanliness standard, bottles are first hit with precise jets which remove any dirt or
debris. They are then soaked in a high-temperature deep cleaning solution that
removes any remaining dirt and sanitizes them. The bottles then move to the
"hydro wash" where they are washed again with a deep cleaning pressure-spray.
MIXING AND BLENDING
H2O and Sugar
Mixing and blending begin with the steps of mixing pure water with refined sugar,
Which creates simple syrup. The syrup is then measured for the correct amount of
Sugar.
Secret Formula
Secret formula is... still secret! That's right; the secret formula remains a mystery to
the millions of people in nearly 200 countries that enjoys our refreshing beverages
everyday. Even though company can't tell you the secret, you can be sure that "LIFE
TASTES GOOD" with Coca-Cola.
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H20 and Syrup
With the syrup nearing its final state, we mix it with pure water, creating the
finished uncorroborated beverage. However, the water and syrup must be mixed in
right ratio. This is done by the beverage proportioning equipment. It accurately
measures the correct ratio for each and sends this mixture to the carbonator.
CO2 Adding
Adding CO2 or carbon dioxide gas is the final touch that carbonates the beverages.
Carbon dioxide not only gives our beverages their effervescent zest, but it also
adds to the distinctive and familiar taste everyone has come to expect from our
beverages.
FILLING
Once all the ingredients have been mixed and blended and the bottles have been
cleaned and sanitized, we're ready to start filling. This is a surprisingly complex
process requiring precision at each step. To begin with, bottles must be carefully timed
as they move to the filler - synchronization is key. Once at the filler, bottles are either
held securely in place by flexible grippers or precisely placed under filling valves by
centering devices. Before the bottles can be filled, the inside of the bottles must be
pressurized. This allows for the force of gravity itself to draw the beverage into the
bottle - a process that ensures the smooth flow of liquid, with little to no foaming.
CAPPING
Once filled, bottles are then capped. We use different caps for different bottles - glass
bottles are usually topped with a metal crown while "PET BOTTLES" are topped with
a plastic screw-top. Each cap type then moves through different parts of the machine,which ensures each cap stays scratch free and is in the right position to be
precisely placed on the bottle. As quality and freshness are key, we use a "no closure"
detector during the capping process and a "go-no-go gauge" or "torque meter" after the
bottles has been capped. The "no-closure" detector checks if a screw top or crowns
has been placed on bottle. The process actually stops if the detector doesn't find a
closure. The "go-no-go gauge" checks for the proper crown crimp and the "torque
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meter" checks to make sure the screw-top is good and tight. If the bottle cap isn't
just right, the beverages can become flat or be affected in other ways. If this happens,
the bottle is discarded.
LABELING
Once the bottles have been filled and capped, they move on to be labeled. A
special machine dispenses labels from large rollers, cuts them and place on the bottles.
For special labels such as commemorative bottles for football championships, the
labels are sent to the bottling plants for approval, and then used for packaging.
Depending on the occasion, some of these special bottles will go only to the specific
locations. For example, a national football championship bottle will be sent only to the
home town or state of the championship team.
CODING
The bottle is now ready to be coded. Each one of our beverages is marked with a
special code that identifies specific information about it. The codes simply identify the
date the beverages was bottled or canned. These codes identify the date, time, batch
no. and the MRP. Product coding allows us to ensure that u receive our beverages at
their flavorful best.
INSPECTIION
We inspect bottles at many points during the process. With refillable bottles, it
happens they are first brought into the plant. They are also inspected after they are
washed and again after they are filled. Inspectors look for external bottle imperfections
and make sure each bottle has the right amount of beverages. Even after filling, each
plant samples bottles for analysis in its lab to ensure quality is up to standards.
PACKAGING
Once our filled beverages have passed final inspection, they are ready to be
packaged for delivery. Generally, packing can refer to everything from the unique
"BOTTLE" and "CAN" designs, to label designs, to cardboard boxes and containers,
to plastic rings. Because the needs and tastes of our consumers are so diverse, the
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WAREHOUSING & DELIVERY
In order to make sure the freshest beverages possible get to you, each warehouse must
efficiently manage the thousands of beverages cases produced each day. Beverage
organization is key, though it's the bottle and can coding that allow for the necessary
precision. From the warehouse, we load beverages onto our distinctive trucks. Night
and day, our trucks are de livering our refreshing beverages to stores, soda
fountains, and vending machines near you
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.
2.4 History
The first Coca-Cola recipe was invented in a drugstore in Columbus, Georgia by John Stith
Pemberton, originally as a cocawine called Pemberton's French Wine Coca in 1885. He may
have been inspired by the formidable success of Vin Mariani, a European cocawine.
In 1886, when Atlanta and Fulton County passed prohibition legislation, Pemberton
responded by developing Coca-Cola, essentially a non-alcoholic version of French Wine
Cola. The first sales were at Jacob's Pharmacy in Atlanta, Georgia, on May 8, 1886. It was
initially sold as a patent medicine for five cents a glass at soda fountains, which were
popular in the United States at the time due to the belief that carbonated water was good for
the health. Pemberton claimed Coca-Cola cured many diseases, including morphine
addiction, dyspepsia, neurasthenia, headache, and impotence. Pemberton ran the first
advertisement for the beverage on May 29 of the same year in the Atlanta Journal...
By 1888, three versions of Coca-Colasold by three separate businesseswere on the
market. Asa Griggs Candler acquired a stake in Pemberton's company in 1887 and
incorporated it as the Coca Cola Company in 1888. The same year, while suffering from an
ongoing addiction to morphine, Pemberton sold the rights a second time to four more
businessmen: J.C. Mayfield, A.O. Murphey, C.O. Mullahy and E.H. Bloodworth.
Meanwhile, Pemberton's alcoholic son Charley Pemberton began selling his own version of
the product.
John Pemberton declared that the name "Coca-Cola" belonged to Charley, but the other two
manufacturers could continue to use the formula. So, in the summer of 1888, Candler sold
his beverage under the names Yum Yum and Koke. After both failed to catch on, Candler
set out to establish a legal claim to Coca-Cola in late 1888, in order to force his two
competitors out of the business. Candler purchased exclusive rights to the formula from
John Pemberton, Margaret Dozier and Woolfolk Walker. However, in 1914, Dozier came
forward to claim her signature on the bill of sale had been forged, and subsequent analysis
has indicated John Pemberton's signature was most likely a forgery as well.
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Old German Coca-Cola bottle opener
In 1892 Candler incorporated a second company, The Coca-Cola Company (the current
corporation), and in 1910 Candler had the earliest records of the company burned, further
obscuring its legal origins. By the time of its 50th anniversary, the drink had reached the
status of a national icon for the USA. In 1935, it was certified kosher by Rabbi Tobias
Geffen, after the company made minor changes in the sourcing of some ingredients.
Coca-Cola was sold in bottles for the first time on March 12, 1894. The first outdoor wall
advertisement was painted in the same year as well in Cartersville, Georgia. Cans of Coke
first appeared in 1955. The first bottling of Coca-Cola occurred in Vicksburg, Mississippi, at
the Biedenharn Candy Company in 1891. Its proprietor was Joseph A. Biedenharn. The
original bottles were Biedenharn bottles, very different from the much later hobble-skirt
design that is now so familiar. Asa Candler was tentative about bottling the drink, but two
entrepreneurs from Chattanooga, Tennessee, Benjamin F. Thomas and Joseph B. Whitehead,
proposed the idea and were so persuasive that Candler signed a contract giving them control
of the procedure for only one dollar. Candler never collected his dollar, but in 1899
Chattanooga became the site of the first Coca-Cola bottling company. The loosely termed
contract proved to be problematic for the company for decades to come. Legal matters werenot helped by the decision of the bottlers to subcontract to other companies, effectively
becoming parent bottlers.
Coke concentrate, or Coke syrup, was and is sold separately at pharmacies in small
quantities, as an over-the-counter remedy for nausea or mildly upset stomach.
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2.5 MILESTONES
May of 1886 Pemberton concocted caramel- colored syrup in a three legged brass kettle in
his backyard. He first distributed the new product by carrying Coca Cola in a jug down the
street at Jacobs pharmacy. And for five cents, consumers could enjoy a glass of Coca Cola
at the Soda fountain. Whether by design or accident carbonated water was teemed with new
syrup, producing a drink that was claimed delicious and refreshing.
1886
Sales of Coca-Cola averaged nine drinks per day. That first year, Dr. Pemberton sold 25
gallons of syrup, shipped in bright red wooden Kegs. Res has been a distinctive color
associated with No. 1 soft drink brand ever since.
1891
Atlanta entrepreneur G. Candler had acquired complete ownership of Coca Cola
business. Within four years, Candlers merchandising flair helped expand consumption of
Coca Cola to every state and territory.
1893
In January Coca Cola was registered in the US patent office.
1894
The first syrup plant outside of Atlanta was opened in Dallas.
1906
First two countries outside USA to bottle Coca Cola were Cuba and Panama.
1915
Route Class Company created the Coca Cola counter glass bottle.
1917
3 million cokes sold per day...
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1919
Coca Cola company sold to a group of investors for $25 million.
1923
R.W Woodruff became president of the Coca Cola Company. His more than six decades
of leadership took the business to unrivaled heights of commercial success, making Coca
Cola an institution the world over.
1925
6 million Cokes sold per day.
1927
The first Coca Cola radio advertisement.
1928
Annual bottled Coca Cola sales exceeded fountain sales for the first time.
1929
Advertising slogan-The pause that refreshes
1936
Coca Cola Company observed its 50 anniversary.
1940
Coke is bottled in more than 40 countries.
1945
Coke is registered as a trademark by US Patent trademark office.
1956
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Advertising slogan-Coca Cola, making good things taste better.
1960
Metal Cans introduced. Coca Cola Company purchased the Minute Maid Corporation.
1961
Sprite was introduced.
1969
Hellenic Bottling Company S.A. is headquartered in Athens.
The Coca-Cola Company grants bottling rights in Greece.
1970
Advertising slogan Its the Real thing.
1971
The song Id like to buy the world a Coke was released.
1979
Advertising slogan- Have a Coke and a Smile.
1981
Kar-Tess Holding S.A. acquires 99.9 per cent interest in Hellenic Bottling Company S.A.
1982
Diet Coke was introduced in July
1988
Coca-Cola was the first independent operator in USSR.
1989
Advertising slogan-Cant beat the feeling.
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1991
Hellenic Bottling Company S.A. shares are listed on the Athens Stock Exchange.
1993
Coca-Cola exceeds 10 billion cases sold worldwide.
1998
Coca-Cola Amatil Limited de-merges its European operations, resulting in the formation
of Coca-Cola Beverages plc.
2000
Coca-Cola Beverages plc is acquired by Hellenic Bottling Company S.A. to form Coca-
Cola Hellenic Bottling Company S.A.
Included in the social responsibility index FTSE4Good.
2001
Coke 200ml was launched known as chotta coke in inda.
2002
Acquired all bottling operations in the Baltics.
Acquired Valser Mineralquellen AG in Switzerland and Dorna Apemin in Romania.
Coca-Cola Hellenic Bottling Company S.A. lists its American Depositary Receipts
(ADRs) on the New York Stock Exchange.
FTSE4Good listing confirmed under the new stricter environmental, social and humanrights criteria.
2003
Twentieth anniversary of our Amita juice brand, the market leader in Greece with 29
flavours.
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Recapitalisation plan results in a return of 2 per share to shareholders.
Acquired Multivita sp. z.o.o, in Poland and Rmerquelle GmbH in Austria.
Acquired the Greek potato chip company Tsakiris S.A.
First country operations certified OHSAS 18001.
2004
Acquired Gotalka d.o.o., a water company in Croatia.
Eight Coca-Cola Hellenic Bottling Company territories join the European Union (EU).
Published the first Global Reporting Initiative (GRI) report in the non-alcoholic beverage
industry.
2005
Acquired Vlasinka d.o.o. mineral water company in Serbia and Bankya Mineral Waters
Bottling Company E.O.O.D. in Bulgaria.
Acquired the Multon Z.A.O. Group, a leading Russian fruit juice company.
Acquired Vendit Ltd, one of the largest independent vending operators in Ireland.
Signed the UN Global Compact.
Ratified the UNESDA commitments to the EU Platform on Diet and Health.
Launched the Green Danube Partnershipwith the International Commission for the
Protection of the Danube River (ICPDR).
2006
Sales volume exceeds 500 million unit cases of non-sparkling drinks for the first time in
one year.
Acquired the Fresh & Co d.o.o. Group, a leading Serbian fruit juice company.
Acquired Lanitis Brothers Public Limited, the Coca-Cola bottler in Cyprus.
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Acquired Fonti Del Vulture S.r.l., a producer of high quality mineral water in Italy.
Acquired Yoppi Kft., a hot and cold beverage vending operator in Hungary.
Named Notable Reporter on Progress by theUN Global Compact.
2007
Acquired Eurmatik, a full-line vending operator in Italy.
Acquired a newly constructed beverage production facility, Aquavision in Russia.
Signed the UN Global Compact CEO Water Mandate, Caring for Climate statement and
the Bali Communiqu.
Announced intent to build 15 combined heat and power (CHP) units to reduce total
carbon dioxide emissions from operations by 20 per cent.
Opened the first industry-owned PET-to-PET recycling plant.
Achieved the milestone of two billion unit case sales volume in one year.
Earnings before interest, tax, depreciation and amortisation (EBITDA) per annum in
excess of 1 billion for the first time.
Launched guideline daily amount (GDA) labelling in the EU states.
2008
Formed three-party joint venture with The Coca-Cola Company and illycafe SpA, Italy's
producer of premium coffees, to manufacture, market, sell and distribute premium ready-to-
drink (RTD) iced coffee products.
Acquisition of Socib, the second largest Coca-Cola franchise bottler in Italy.
Included in the Dow Jones Sustainability Indexes (DJSI).
2009
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Agreement with Campbell Soup Company regarding the distribution by Coca-Cola
Hellenic of Campbell soup and broth products throughout Russia.
2.6 COCA-COLA DATES AND SLOGANS
1886 Drink Coca-Cola.
1904 Delicious and Refreshing.
1922 Thirst knows no reason.
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1927 Around the corner forms anywhere.
1929 The pause that refreshes
1936 Its the refreshing thing to do.
1948 Where theres Coke Theres Hospitality
1952 What you want is a Coke
1956 Coca-Cola makes Good Things Taste Better
1958 The Cold, Crisp taste of Coke
1963 Things Go Better With Coke
1970 Its the Real Thing
1975 Look up America
1979 Have a Coke and a Smile
1982 Coke is it!
1987 You Cant beat the Real Thing
1990 Taste Thunder Thums up
1993 Always Coca-Cola
1999 Life ho to aisi-India
2002 Thanda matlab Coca-Cola-India
2.7 PRODUCT RANGE OF THE COMPANY
Energy Drinks
For those with a high-intensity approach to life,
Coca Colas brands of Energy Drinks
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Contain ingredients such as ginseng
Extract, guarana extract, caffeine and B
Vitamins.
Juices/Juice Drinks
We bring innovation to the goodness of juice in
Coca Colas more than 20 juice and juicedrink
Brands, offering both adults and
Children nutritious, refreshing and flavorfulbeverages.
Soft Drinks
Coca Colas dozens of soft drink brands
Provide flavor and refreshment in a variety of
Choices. From the original Coca-Cola to
Most recent introductions, soft drinks from the
Coca-Cola Company are both icons and
Innovators in the beverage industry.
Sports Drinks
Carbohydrates, fluids, and electrolytes team
Together in Coca Colas Sports Drinks,
Providing rapid hydration and terrific taste for43
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Fitness-seekers at any level.
Tea and Coffee
Bottled and canned teas and coffees
Provide consumers' favorite drinks in
Convenient take-anywhere packaging,
Satisfying both traditional tea drinkers and
Todays growing coffee culture.
Water
Smooth and essential, our Waters and Water
Beverages offer hydration in its purest form
44
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Other Drinks
So much more than soft drinks. Coca
Colas brands also include milk products,
Soup and more so you can choose a Coca Cola
Company product anytime, anywhere for
Nutrition, refreshment or other needs.
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2.8 BRANDS OF
INDIA
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Coca-Cola Mainly preferred by the Youngster & Kids.
Thums-Up Youngster
.
Limca Common Drink.
Fanta Basically Preferred by Ladies and Kids.
Sprite Youth.
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Kinley Soda Mostly those who consume liquor.
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2.9 a MISSION
Our mission declares our purpose as a company. It serves as the standard against which we
weigh our actions and decisions. It is the foundation of our Manifesto.
To refresh the world in body, mind and spirit.
To inspire moments of optimism through our brands and our actions.
To create value and make a difference everywhere we engage.
2.9 b VISION:
Our vision guides every aspect of our business by describing what we need to accomplish in
order to continue achieving sustainable growth.
People: Being a great place to work where people are inspired to be the best they can be.
Portfolio: Bringing to the world a portfolio of quality beverage brands that anticipate and
satisfypeople's desires and needs.
Partners: Nurturing a winning network of customers and suppliers, together we create
mutual,enduring value.
Planet: Being a responsible citizen that makes a difference by helping build and supportsustainable communities.
Profit: Maximizing long-term return to shareowners while being mindful of our overall
responsibilities.
2.9c IMPROVED MISSION STATEMENT:
At Coca Cola we're committed to achieving business and financial success while leaving a
positive imprint on society delivering what we call Performance with Purpose.
Our mission is to be the world's premier consumer Products Company focused on
convenient foods and beverages. We seek to produce financial rewards to 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 for honesty,
fairness and integrity.
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2.9 d IMPROVED VISION STATEMENT:
Coca cola Co responsibility is to continually improve all aspects of the world in which we
operate environment, social, economic creating a better tomorrow than today."
Our vision is put into action through programs and a focus on environmental stewardship,
activities to benefit society, and a commitment to build shareholder value by making Coca
cola Co a truly sustainable company.
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2.10 COCA COLA - RATIO ANALYSIS
2006 2005 2004
$
Perc
ent $
Perc
ent $
Income Statement
(in (in (in
millions) millions) millions)
Revenue 24,088
100.
0% 23,104
100.
0% 21,962
Cost of Goods Sold 8,164
33.9
% 8,195
35.5
%
Interest Expense 220
0.9
% 240
1.0
%
Tax Expense 1,498
6.2
% 1,818
7.9
%
Income from Cont Operations 5,080
21.1
% 4,872
21.1
% 4,847
Net Income 5,080
21.1
% 4,872
21.1
%
Balance Sheet
16.0
%Cash 2,440
8.1
% 4,701
Short Term Investments 150
0.5
% 66
0.2
%
Accounts Receivable 2,704
9.0
% 2,281
7.8
% 2,171
Inventory 1,641
5.5
% 1,424
4.8
% 1,420
Current Assets 8,441
28.2
% 10,250
34.8
%
Long Term Investments 6,783
22.6
% 6,922
23.5
%
Net Fixed Assets 6,903
23.0
% 5,786
19.7
%
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Other Assets 7,668
25.6
% 6,469
22.0
%
Total Assets 29,963
100.
0% 29,427
100.
0% 31,327
Current Liabilities 8,890 29.7% 9,836 33.4%
Total Liabilities 13,043
43.5
% 13,072
44.4
%
Stockholders' Equity 16,920
56.5
% 16,355
55.6
%
Cash Flow
Cash Flow from Operations 5,957 6,423 5,968
Dividends Paid 2,912 2,679
Interest Paid 220 240
Per Share
Market Price at Year End 48.25 40.31
Earnings Per Share Basic 2.16 2.04
MAP: Showing Workforce [71,000 in
2006]
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2.11 CURRENT ORGANIZATIONAL CHART
CEO
EVP/ CFO
and
EVP/ Preside
nt
SVP &
SVP & SVP &
Presiden
t
Preside
nt Director Director
EVP & COO
General
Bottling MKT Human Public
Counsel
Invest/Strategy
Resources Affairs/
Supply
Commu
ni-
Chain -cation
Presiden
t Presiden
t
Presiden
t
Presiden
t Presiden
t
Latinof
Eurasia
of
African
of
PacificEuropea
n
America
Group Group Group
Union
GroupMarket
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2.12 E-COMMERCE:
Good points:
Brand Promotion
Attractive products selection
Look and feel 8
Provision of multimedia product, catalogue pages
Personal attention
Community relationships
Weak points:
Performance and service: that is not easy navigation, shopping and purchasing, and
prompt shipping and delivery.
Discount pricing is not being offered.
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Strengths
Worlds leading brand Coca-Cola has strong brand recognition across the globe. The
company has a leading brand value and a strong brand portfolio. Coca-Cola is one of
the leading brands in their top 100 global brands ranking in 2006.The value of the
Coca-Cola was $67,000 million in 2006. Coca-Cola ranks well ahead of its close
competitor Pepsi which has a ranking of 22 having a brand value of $12,690 million
Furthermore; Coca- Cola owns a large portfolio of product brands. The company owns
four of the top five soft drink brands in the world: Coca-Cola, Diet Coke, Sprite and
Fanta. Strong brands allow the company to introduce brand extensions such as Vanilla
Coke, Cherry Coke and Coke with Lemon. Over the years, the company has made
large investments in brand promotions. Consequently, Coca-cola is one of the best
recognized global brands. The companys strong brand value facilitates customer recall
and allows Coca-Cola to penetrate new m2arkets and consolidate existing ones. Coca-
Cola Company, The large scale of operations with revenues in excess of $24 billion
Coca-Cola has a large scale of operation. Coca-Cola is the largest manufacturer,
distributor and marketer of nonalcoholic beverage concentrates and syrups in the
world. Coco-Cola is selling trademarked beverage products since the year 1886 in the
US. The company currently sells its products in more than 200 countries. Of the
approximately 52 billion beverage servings of all types consumed worldwide everyday, be8verages bearing trademarks owned by or licensed to Coca-Cola account for
more than 1.4 billion. The companys operations are supported by a strong
infrastructure across the world. Coca-Cola owns and operates 32 principal beverage
concentrates and/or syrup manufacturing plants located throughout the world. In
addition, it owns or has interest in 37 operations with 95 principal beverage bottling
and canning plants located outside the US. The company also owns bottled water
production and still beverage facilities as well as a facility that manufactures juice
concentrates. The companys large scale of operation allows it to feed upcoming
markets with relative ease and enhances its revenue generation capacity. Robust
revenue growth in three segments Coca-colas revenues recorded a double digit
growth, in three operating segments. These three segments are Latin America, East,
South Asia, and Pacific Rim and Bottling investments. Revenues from Latin America
grew by 20.4% during fiscal 2006, over 2005. During the same period, revenues from
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East, South Asia, and Pacific Rim grew by 10.6% while revenues from the bottling
investments segment by 19.9%. Together, the three segments of Latin America, East,
South Asia, and Pacific Rim and bottling investments, accounted for 34.8% of total
revenues during fiscal 2006. Robust revenues growth rates in these segments
contributed to top-line growth for Coca-Cola during 2006.
Weaknesses
Negative publicity, Company received negative publicity in India during September
2006.The Company was accused by the Center for Science and Environment (CSE) of
selling products containing pesticide residues. Coca-Cola products sold in and around
the Indian national capital region contained a hazardous pesticide residue. These
pesticides included chemicals which could cause cancers, damage the nervous and
reproductive systems and reduce bone mineral density. Such negative publicity could
adversely impact the companys brand image and the demand for Coca-Cola products.
This could also have an adverse impact on the companys growth prospects in the
international markets. Sluggish performance in North America Coca-Colas
performance in North America was far from robust. North America is Coca-Colas
core market generating about 30% of total revenues during fiscal 2006. Therefore, astrong performance in North America is important for the company.
Summary in points:
Strengths:
Leading brand value and a strong brand portfolio
Coca-Cola, Diet Coke, Sprite and Fanta
Large investments in brand promotions
sells its products in more than 200 countries
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Company also owns bottled water production and still beverage facilities as well as
a facility that manufactures juice concentrates.
These three segments are Latin America, East, South Asia, and Pacific Rim and
Bottling investments
Return on total assets increases over the period consistently 2005, 06, 07 15.47%,
16.55%, and 16.95% respectively.
Weaknesses:
Negative publicity in India
Inventory turnover decreased by 13.29%
Return on equity decreased by 40.50%
Sluggish performance in North America Coca-Colas performance in North
America was far from robust
Collection form debtors decreased by 15.68%
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2.13 SWOT ANALYSIS
SWOT Analysis is a strategic planning tool used to evaluate the Strengths,
Weaknesses, Opportunities, and Threats inside a company, project, or a business
venture. It involves identifying the internal and external factors that are
favorable/unfavorable for business to succeed
SWOT ANALYSIS FOR COCA COLA COMPANY
STRENGTHS
Brand equity/image & recognition
Product distribution and worldwide network
Solid financial performance
One of the world's most recognized brand.
Product diversification (water, juices, soft drinks, sport drinks, etc)
Co-operate identity.
Innovation
WEAKNESSES
Customer concentration, particularly in the US (Wal-Mart accounts for more than
10% of Coca Cola's business in the US)
A lot of customers lack strict brand loyalty towards Coca Cola.
Does not enjoy the number one position in Pakistan.
OPPURTUNITIES
Possible growing demand.
Expansion Reaching all segments.
Globalization
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Catering to Health Consciousness of People
Bottled water growth
Acquisitions of smaller players.
THREATS
Health Drinks Fruit Juice Companies
Key competitors (Pepsi, etc)
Commodity prices growth
Image perception in certain parts of the world.
Smaller, more nimble operators/players
1.14 Concept of RED:
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Right execution daily (RED) is the classification of outlets into Channel &
Category.
Lets know what are the Channel & categories respectively.
CHANNEL - Type of outlet like E&D (EATING AND DRINKING),
GROCERY, or CONVINIENCE?
E&D 1 - It i nc lu des Bakery/Sweet shops/QSR/Juice centers/Soft drink
shops/Tea shops etc.
E&D 2- It includes Sit down restaurants/Bars/Dhabas/Cafes etc.
GROCERY- Outlets primarily engaged in retailing of food and various houses
hold items.
CONVENIENCE-Includes outlets whi ch ar e s ma ll s t or es an d s ho ps ,
generally accessible locally.
CATEGORY -Standard class of outlets like SILVER, GOLD or DIAMOND?
SILVER- Those outlets which sells 200-499 crates per year.
GOLD- Those outlets which sells 500-799 crates per year.
DIAMOND- Those outlet which sells 800 & above crates per year.
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2.15 KANDHARI BEVERAGES Pvt. Ltd.
Kandhari beverages started operations in 1967. Initially it started FOBO operations of
Parle soft drinks. Then it started FOBO operations of Coca Cola on 3rd December
1993. Brands it initiated with were Thums Up, Gold Spot, Limca, Citra, Maaza. At
present it is with Coca Cola, Thums Up, Limca, Sprite, Fanta, Fanta Apple, Maaza,
Kinley, and Minute Maid Pulpy Orange.
PRODUCTION CAPACITY
Kandhari Beverages have two bottling plants one at Baddi and another at Nabipur.
Now days they are producing 50,000 to 60,000 cases per day but they have capacity of
producing 80,000 cases per day. In one run 4000 cases are produced. Production is
decided as per demand which is affected by various reasons.
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CHAPTER-3
PROJECT
PROFILE
3.1 OBJECTIVES OF THE STUDY
To know the market share of Coca-Cola.
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To ensure the availability and visibility of product.
To study the ac tiv at ionon ou tle tsof COCA-COLA Company.
To know brand preference of consumers in packaged drinking water in different
sectors of Chandigarh.
To study the demand of different products available of coca cola and Pepsi.
3.2 RESEARCH METHODOLOGY
A survey data collection method was used. Questions were asked randomly.
Data source
Primary data is collected for purpose of this study.
Research approach
Research Type -: it is an exploratory research for the purpose of the study.
Research method-: Survey method is used to get responses from the respondents.
Sampling plan
Sampling method -: Random sampling
Sampling Unit -:people who drink beverages.
Sample size -: Our sample size was
For soft drink survey
100 students
30 shops
For packaged drinking water survey
500 people
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3.3 SCOPE
For soft drink survey
This survey was done in institutions
Punjab Engineering College
Punjab University
DAV College
Government College For Girls
For packaged drinking water survey
This survey was done in high footfall areas of Chandigarh.
Sector 17
Sector 8 (Madhya marg)
Sector 9 (Madhya marg)
Sukhna lake
Rock Garden
Secretariat
Punjab University
Sector 10
Sector 11
Sector 22
Sector 34
Sector 15
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Sector 19
Sector 35
3.4 LIMITATIONS OF THE STUDY
It is possible that respondent have given biased reply.
Many Respondents do not drink packaged drinking water on regular basis so they
were not clear on there choice.
Because the areas of study were high footfall areas so people were mainly tourists
and the exact market situation and perception of chandigarh people was not cleared.
There are many local brands also which were not included in study so the result wasnot the actual percentage as these major players of local market were missing.
3.5SIGNIFICANCE OF THE STUDY
This study is helpful to find out the sales trends of the Coke products and its
effect on consumers value and satisfaction
To find out problem of the counters and to find out their requirement for more
sales.
Through this study company will know about the availability of its products in the
Market.
As the places where the study was conducted were high footfall areas so the study
of availability will play a very important role in increasing its market share.
The studies conducted tells about the over all availability, demand and competition
in major brands in high footfall areas of Chandigarh.
CHAPTER-4
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RESULT OF THE
SURVEY
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4.1SURVEY IN
EDUCATIONAL
INSTITUTIONS
Preference in between SSD and Juices
Consumers who prefer only SSD 30
Consumers who prefer only Juices 30
Consumers of like both of them 40
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Consumers who pre
SSD
Consumers who pre
Juices
Consumers who pre
both
Comparison of Coca Cola and Pepsi
Cola Flavor
Brands percentag
e
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Ko 82
Pc 6
both 12
K
P
B
Lemon Flavor
Brands percentage
Ko 22.72
Pc 45.45
both 31.81
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K
P
B
Orange Flavor
Brands percentage
Ko 85
Pc 10
oth 5
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K
P
B
Other Flavor
Brands percentag
e
Ko 18.18
Pc 63.63
both 18.18
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K
P
B
Consumer preference in Juices
Number of
respondents
100( single
respondent
have given
more than
one
preference)
Ko 40
Pc 34
Parle 36
Real 23
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Others 22
Ko
Pc
Parl
RealOth
FINDINGS
Preference in juices and soft drinks is same but 40% consumers do not compare
juices and soft drinks and they prefer both of them.
In coke drinks Coca Cola is leading, the main reason may be that Coca Cola is
having two brand names in coke section and Pepsi is having only one brand.
In case o