Anuradha, Gagan, Himanshu, Prafulla, Ritika, Satyam, Tarun, Vibhu A.K.

A Group
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Pepsi Co
Entered in India in 1989
Country's largest selling
soft drinks company
The group has:
• An expansive beverage
Snack food & exports
business
• 43 bottling plants in India
Brands include:
•Pepsi; Cola,Diet
•7Up
•Mirinda
•Mountain Dew
•Slice fruit drink
•Tropicana
•Aquafina
Introduction contd’
Provides direct employment to 4,000 people and
indirect employment to 60,000 people including
suppliers and distributors.
Invested more than U.S.$700 million since the
company was established in the country
PepsiCo’s foods company, Frito-Lay manufactures:
 Lay’s Potato Chips
 Cheetos extruded snacks

 Uncle Chipps

 Kurkure

 Lehar brands
ORGANIZATIONAL STRUCTURE

Unit Manager

Territory Development Marketing Development

Manager Manager

Assistant Sales and Development Marketing Development

Manager Coordinator

Customer Executives

Sales Trainees
DISTRIBUTion
Channels: ‘Channels are independent organizations
involved in the process of making a product or service
available for use or consumption’. There are different
intermediaries in channels that facilitate the availability
of goods to the consumer.
Coverage: Two things come under market coverage.
Market Reach-can be termed as accessibility
Market Penetration-can be termed as Frequency
SALES AND DISTRIBUTION
NETWORK OF PEPSICO INDIA
COMPANY

COBO FOBO

WAREHOUSE

C&F DISTRIBUTOR

SALESMEN SALESMEN

WHOLESALER SLUMS RETAILER

RETAILER CUSTOMER

CUSTOMER
SALES AND DISTRIBUTION
NETWORK contd’
COBO: These are Company owned bottling operations operating
directly under the Company. Out of 32 bottling plants, PepsiCo
owns 15.
FOBO: These are Franchise owned bottling operations. R K
Jaipuria group does all the franchisee-bottling operations for
PepsiCo India
Warehouses: These are Company or franchisee owned
warehouses spread over various locations that cover the
respective territories and come under the purview of their
respective Area or Territory Offices.
C & F Centers: These are the biggest centers in the distribution
network and receive proper assistance from the Company (either
COBO or FOBO).
SALES AND DISTRIBUTION
NETWORK contd’
Distributors: These are small, compared to C & F centers.
Wholesalers: These are smaller than C & F centers and
Distributor points and get the stock directly from the
Company or Franchisee.
Slums: They are generally smaller than the Wholesalers
are.
Retailer: Retailers are the most important chain in the
distribution channel of Pepsi as they are the only point of
contact with the customers.
Distribution Channel in China
Introduction
Founded by: Michael Dell (CEO) in 1984
Revenue $57.4 billion (2007)
Net income $2.6 billion (2007)
Employees 90400
Operate in 34 countries.
Slogan: “Uniquely You”

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Business Model of DELL
 Dell Business Model with three elegantly simple, but ultimately powerful
concepts:
 Direct Selling---- absent intermediaries, from the manufacturer to a final
customer
 Customization
 Dell’s response to the Internet revolution
The Direct Model
• “Configure to order” approach to manufacturing delivering
individual PC’s
• Computer literate sales persons were employed
• Each system was assembled according to the preference of
customers
• To maintain quality level at par inventory was reduced and
PC’s were produced as per the orders received
• Dell decided to reduce inventory with information,
suppliers were given the access to the company’s internal
data
• The internet proved to be a boon for the model and to Dell
• Transactions were facilitated directly through their
websites
Comparison of Dell Vs Traditional
Business Model
DELL’s Distribution MODEL

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 DELL’s VALUE WEB MODEL

Component
Suppliers

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 DELL’s VALUE WEB MODEL

CMs/OEMS

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DELL’s VALUE WEB MODEL

Distributors

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Benefits to company by such
distribution
CASH: Dell maintains a negative cash conversion cycle
means the payment receive for product before it has to
pay for material.
 COST:
1. Dell’s direct sales and build-to-order model has
achieved superior performance in the PC industry in
terms of inventory turnover, reduced overhead, cash
conversion, and return on investment
2. Bypassing the reseller channel that causes further cost
reduction to company.

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Cont…
CRM: Direct customer relationship is the key to Dell’s
business model, and provides distinct advantages over the
indirect sales model.
DEMAND FORECAST: Dell additional advantages over
indirect PC vendors who must try to forecast demand and
ship products based on those forecasts.

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Benefits to customer by such
distribution
Tailored offerings from Dell in terms of add-on products
and services.
Very customizable systems at an affordable rate, since
Dell manufacturing builds specifically for each customer.

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With 290 subsidiaries, more than 100 distributors off-group and 42 plants, all
spread out in about 130 countries, L’Oreal is the leader of the cosmetic
industry. The group has begun its internationalization in 1912 by following
three steps:
• First landing
• Go native
• Globalization
“first landing” - first, commercialization of
professional shampoos to hair-dressers
via distributors in near Europe (Spain,
Italy, Great Britain, Germany and
Poland) and in the Americas.
“go native“ - second, local firms are taken
over for example in the USA (Redken
1993, Maybelline 1996 etc.), in
Argentina (Miss Ylang 2000)
“globalization” - third, subsidiaries
(production, research and development)
are directly created (Greenfield
investment) without any first passage
via distribution. It is the case in Asia
(Japan and Hong Kong)
The way L'Oréal is organized

L'Oréal's national branches are primarily

sales-based. The company develops and
upgrades its products at laboratories in Paris
(France), the United States and Asia.
Production takes place at factories spread
throughout the world. Its sales orientation is
reflected in the organizational structure of the
company, which largely parallels the channels
of distribution.
There are three of these:
 specialist outlets
 hair salons
 retail
Kinds of Distribution Channel
 Specialist Outlet : Luxury items such as Ralph Lauren, Giorgio
Armani and Paloma Picasso perfumes and pharmaceutical products
are sold exclusively through specialist outlets such as perfumeries,
duty-free shops and pharmacies.
 Hair Salons : The second sales channel encompasses hair and beauty
salons and the like. These not only use L'Oréal products themselves,
but also sell them to their clientele.
 Retail : But by far the largest channel is retail: the supermarkets,
department stores and chemists where most of the public buy their
cosmetic and beauty products. This channel of distribution accounts
for more than half of total turnover (1998: 55.9 per cent), and the
Consumer Division which supplies it is therefore the largest within
L'Oréal.
L’OREAL Distribution system in Japan
 Started operations in 1963.

 Market haircut products for professional hairdressers.

 In 1976, the group began to distribute mass – consumer products

under the L’Oreal Paris brand.
 Nihon L’Oreal K.K., a subsidiary created in 1996 which handles all the
Group’s cosmetics in Japan.
 Expansion into overseas markets--particularly Japan--was aided
greatly by the company's new alliance with the Swiss foods giant
Nestlé, to whom Eugène Schueller's daughter, Madame Liliane
Bettencourt, sold nearly half of her L'Oréal stock in 1974.
Characteristics of L’Oreal Paris Vs. L’Oreal Japan
L’Oreal Paris
 Number 1 brand in the world.

Core brand in L’Oreal group.

 Best market share in each
category.
Hair color, styling, skin care &
make – up.
 12 research centers in the world.

2500 researchers
450 patent right in a year.
Characteristics of L’Oreal Paris Vs. L’Oreal Japan
L’Oreal Japan
 Tie up with Sue Uemura

The most popular cosmetic brand

in Japan.
 The third creative stronghold

First: Paris, Second: New York

 Important for Asia market

China, Taiwan, Korea, Thailand

etc.
•The Company was founded in 1962 as a single discount
store in Rogers by a visionary Sam Walton.
•The company had a huge success story in the retail
industry and the company internationally came off the
ground by opening its first store in Mexico City in the year
1991.
•Since then Wal-Mart has extended its international
presence in Canada(1994), China(1996), Brazil(1995),
Argentina(1995), South Korea(1996) and Germany(1998).
•Wal-Mart had a major failure in Korea and Germany.
Company’s situation Analysis for
going global
 The company mainly decides as to which country they have to target,
on the basis of the prevailing competitive scenario as well as the
economic conditions.
 The company has mainly three strategies when they target any
country:-
1) Acquiring an existing player.
2) Starting a new store on its own.
3) Entry by joint ventures.
Wal-Mart’s entry In Canada
Marketing strategies the company adopted for its entry in Canada.
 Wal-Mart in Canada operated in areas that have high brand
recognition.
 The company tried to operate in areas where they require minimum
cultural adaptation.
 Emphasized more on store design as well as customer service as a
mode of being successful.
 Utilized discount tactics.
 The company was very much successful and has wiped out T.Eaton
company which was a major player in Canada in retail sector.
Distribution Channel Of Walmart
Wal-Mart in Canada cont…..
 There existed a wool co chain in Canada comprising of 122 stores. Wal-Mart has
entered the country by acquiring this chain.
 The company also focused its attention towards energy efficiency, waste division
and supply chain efficiency.
 The company planned to open 15-20 stores every year as well as each store has a
Mc Donald’s Location.
 The company operated through Superstores, discount stores and supercenters in
Canada.
 Canada's Supercentre was opened in Stouffville in Ontario and this supercentre
has almost same features as that of discount stores.
 Wal-Mart Discount Stores are discount department stores with size varying from
51,000 square feet to 150,000 square feet, . They carry general merchandise and a
selection of food. Many of these stores also have a garden centre, a pharmacy, Tire
& Lube Express, optical centre, one-hour photo processing lab, portrait studio, a
bank branch, a cell phone store and a fast food outlet (usually McDonald's).
 Square one shopping centre is one of the major discount centre of Canada.
Wal-Mart in china
 1996 Wal-Mart entered into China through a joint venture agreement with
China International Trust and Investment Corp
 Wal-Mart has 66 stores in China, Yet expansion in other countries, such as

Germany, Japan, and South Korea has been difficult

 Wal-Mart is China's number one importer

and sixth largest trading partner, surpassing

even Germany and Britain
 More than 70 percent of goods on Wal-Mart’s

shelves come from China.

 More than 80 percent of the 6,000 factories of

Wal-Mart's network of suppliers are in China

Contd….
 An important feature of Wal-Mart’s logistics infrastructure is its fast
and responsive transportation system.
 40 Regional Distribution Centers. Each one is over 1 million square

feet in size
 Company own more than 3000 trucks whereas most competitor

outsource trucking
 Wal-Mart has implemented satellite network system that allowed

information to be shared company’s wide network of stores ,

distribution centers and suppliers
 Inventory management
 EDI enabled the suppliers to download purchase orders along with store-
to-store sales information relating to their products sold.
 Distribution stores is strategically placed so that it could eventually serve
100-150 Wal-mart stores within a day
 P & G, Clorox and Jonson & Jonson are among its 3000 suppliers
 To make its distribution process more efficient, Wal-Mart also made use
of a logistics technique called “cross-docking.”
 RFID technology to replace bar code tech, reduce the stock-outs at the
stores.
 The order management and store replenishment of goods are entirely
executed with the help of computers through the Point-of-Sales (POS)
system.
The Direct Farm Program in China
 The Direct Farm Program optimizes the industrial supply chain and food safety
standards, and also increases farmers' incomes, according to Wal-Mart (China)

 The first initiative was to set up Wal-Mart Fresh Food Distribution Centers to
guarantee the freshness and quality of products. Wal-Mart China has set up
two small-size distribution centers in Shenzhen and Guangzhou

 The second initiative was to equip the fresh food distribution centers with
food testing stations to ensure food safety. The first one will be located in
Guangzhou

 The third initiative was Wal-Mart's sponsorship of training sessions to ensure

the sustainability of the program. The company plans to train 200 Wal-Mart
trainers this year to instruct farmers
Thank You

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