Pepsi

Supply chain analysis

11-august-2015

Assignment of supply chain management

Submitted to:

Sir hafiz kashif

Report on supply chain analysis of pepsi company

Submitted by:

Tayyaba illyas

Mobeena azam

Shabeeha abdul latif

Introduction

Pepsi is one of the world’s largest consumer product and second largest soft drink Company.

It is a very well organized multinational company, which operates almost all over the world. Pepsi a carbonated soft drink was first introduce by a pharmacist named Caleb Davis Bradham in New Bern in 1893 as “Brad’s Brad’s Drink” that help in digestion and was a healthy drink. It was a new brand at that time. It includes water, real sugar, caramel, lemon oil, nutmeg and other natural additive as its ingredients. In 1898 Pepsi was renamed as Pepsi Cola, named after its two ingredients pepsin and kola nut. Due to the increasing demand of Pepsi Cola, Caleb Davis formed a Pepsi Cola company in 1902. On 16 June 1903, Pepsi Cola became an official trade mark because of its popularity. The business began to grow and Caleb sold almost 20,000 gallons of Pepsi Cola. In 1904 Caleb Davis decided to offer Cola in

bottles because of of continuous rise in its demand and popularity and in 1910 there were 240 franchises of Pepsi Cola in 24 states. Pepsi Cola enjoyed many years of success.

During World War 1 hard time fell on Pepsi due to fluctuating price of sugar and Caleb was unable to produce enough quantity of Pepsi to meet the consumer demand. He then takes an alternate action and add molasses instead of sugar but it affects its taste. At the end of the war sugar price increases from 3 cent to 28 cent per pound and Caleb purchase a large quantity of sugar on a very high price that cause the business downfall and Pepsi Cola entered bankruptcy in May 31, 1923 and its assets were sold to Craven Holding Corporation for $30,000.

After many years of ups and downs, Pepsi is back on top and in 2013 it was ranked as number one on core brand’s list of most respected companies. Pepsi today is a world leader in convenient snacks, foods, and beverages, with more than 280,000 employees and revenue reaching $60 billion of dollars. The company is the owner of some of the greatest world brands Pepsi-Cola, Mountain Dew, Diet Pepsi, Lay’s, Doritos, Tropicana, Gatorade, and Quaker. These are well-known all around the world.

"Pepsi's responsibility is to continually improve all aspects of the world in which we operate - environment, social, economic - creating a better tomorrow than today.”

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.

Supply chain management analysis of pepsi

pepsi Company is selected for this project because it has one of the largest supply chain systems in the world. PepsiCo's supply chain management had been based on the idea of collaboration and integration. The company took several initiatives to have a more collaborated and integrated supply chain, which would become a source of competitive advantage

Supply chain management (SCM) is the management of anetwork of interconnected businesses involved in the ultimate provision of product and service packages required by endcustomers. Supply Chain Management encompasses the planning and management of all activities involved in sourcing, procurement,conversion, and logistics management activities.

It also includes coordination and collaboration with channelpartners, which can be suppliers, intermediaries, third-partyservice providers, and customers.In essence, Supply Chain Management integrates supply and demand management within and across companies.Pepsi company uses two type of supply chain flows

Pull view of supply chain:Pepsi Sales order and processing: The Shipping Manager receives sales order from Sales Team, distributors throughtelephone, fax & email one day before dispatch. The sales are made to base distributors on advance payment against orders then shipping manager  plans according to the demand of distributors on daily basis.

Push view of supply chain:with push process execution is initiated in anticipation to a customer order. Pepsi has a seasonal demand.Just in time concept is applicable innon-seasonal period and not applicablein seasonal period. All processes thatare part of the procurement cycle,manufacturing cycle, replenishmentcycle, and customer order cycle are push processes.

Supply chain strategy:

1.Customer and Supply Chain Uncertainty identifying customer needs demand uncertainty andimplied demanduncertainty3 Uncertainty for the capability of the supply chain

2.Understanding the Supply Chain Capabilities.3.Achieving the Strategic Fit.

Customer Relationship Management

Customer Relationship Management For PepsiCo:

CRM Definition:

CRM Definition Customer Relationship Management (CRM) is an information industry term for

methodologies, software, and usually Internet capabilities that help an enterprise manage

customer relationships in an organized and efficient manner. In many cases, an enterprise builds

a database about its customers. This database describes relationships in sufficient detail so that

management, salespeople, and customer service reps can access information; match customer

needs with product plans and offerings; remind customers of service requirements; know what

other products a customer had purchased

. There are three parts of application architecture ofCRM.

Operational CRM

Operational CRM means supporting the so-called " front office "business processes, which include customer

contact (sales , marketing and service ).

Analytical CRM

In analytical CRM, data gathered within operational CRM are analyzed to segment

customers or to identify cross-selling and up-selling potential. Data collection and analysis is

viewed as a continuing and iterative process .

Collaborative CRM

Collaborative CRM facilitates interactions with customers through all channels (personal, letter, fax, phone,

web , e-mail) and supports co-ordination of employee teams and channels.

Objectives of CRM:

Objectives of CRM

To simplify marketing and sales process

To make call centers more efficient

To provide better customer service

To discover new customers and increase customer revenue

To cross sell products more effectively.

Customer Relationship Management of Pepsi

Businesses use customer relationship management systems to “capture and integrate customer

data from all over the organization, consolidate the data, analyze the data, and then distribute the

results to various systems and customer touch points across the enterprise”

These systems are useful in improving sales, marketing, and customer service in a business. For

Pepsi, CRM systems play a crucial role in integrating the companies nearly 400,000 across the

enterprise. Through the use of CRM System, Pepsi has been able to deliver top-line growth and

superior customer service.

Pepsi’s current CRM application has allowed for conversion of former disparate sales systems

into an integrated Internet application solution, a 360 degree view of the entire customer base,

simplification of the resolution process, accurate and timely deliveries, and reduction of product

inventory close time by one to two days. Through the use of real-time customer information, tel-

sel agents, or telemarketers, are able to have up-to-date information on any issues of needs of the

customer through their account, allowing for a clear picture of their customers and their

relationships with the company. This also allows workers to uncover potential sales opportunities

with their customers. The use of real-time information is also used to improve customer

interaction and satisfaction through the use of help desks, customer service representatives, and

allowing customers themselves access to real-time information. Pepsi uses CRM applications to

determine profitable customers, uncover potential sales opportunities, improve customer

interactions and relations, and provide the enterprise with up-to-date customer information.