ABSTRACT

Soft drinks are playing the vital role in the market and the companies are also getting the good profits on these products. The soft drinks industry has originated in 1772. Now these drinks spread all over the world and the millions of bottles is consumed every day. Now this business is a global one and the companies are facing high competition in this business and they are changing their strategies according to the situations. Pearl Beverages Pvt. Ltd. Takes a great care to maintain quality control of products in their factory. The bottles are visually examined for impurities continuously, as the bottles move out. Samples are checked every ten minutes of production time by the chemist for its quality and hygienic condition. The chemical analysis is also flavours, gas contain and sugar percentage. The appearance, smell and taste of the production are suspended and the correcting measures are taken also as to sent right the bottling process. The main objective of the study is to find out the strength and weakness of the Pepsi in visakhapatnam zone when compared to the Coca-cola, that is mainly in the three places in Srikakulam district i.e. Srikakulam, Narasannapeta, and Amadalavalasa .Consulting almost all the outlets in these three areas, which are selling the soft drinks with a structured questionnaire, has done the study. The data has been collected and analyzed and interpreted by the help of the graphical representation technique. The analysis revels the various strengths and weaknesses of Pepsi in these areas along with the position of competitors. The most of the consumers preferred soft drinks because of better taste and to quench out their thrust. But now days, due to the changing food habits consumers have started adding the soft drinks in their food habits. The total sales of the soft drinks the Pepsi’s share is more but when compared with the Cock the number of outlets are less than Cock. Finally it can be concluded that the industry needs lot of channel management activities to do along with various promotional strategies for the customers. I wish the company got its objectives achieved

CONTENTS
Chapter No
1.

Title
INTRODUCTION & DESIGN OF THE STUDY 1.1 About the Marketing topic 1.2 Need of the Study 1.3 Hypothesis 1.4 Objective of the Study 1.5 Research Methodology 1.6 Limitations of the Study 1.7 Chapter Plan of the Study

Page No

2.

ORGANIZATION PROFILE 2.1 Genesis and Growth 2.2 Organization Structure 2.3 Production Function 2.4 HR Function 2.5 Finance Function 2.6 Marketing Function 2.7 Future Plans

3.

THEORITICAL FRAMEWORK 3.1 Introduction 3.2 Topic Coverage 3.3 How it relates to Marketing Management 3.4 Measuring Performance

4.

DATA ANALYSIS & INTERPRETATION

5.

SUMMARY & SUGGESTIONS 5.1 Summary 5.2 Major findings 5.3 Suggestions 5.4 Implications for Owners / Managers 5.5 conclusions 5.6 Scope for the Future research

6.

BIBLIOGRAPHY & QUESTIONNAIRE 6.1 Bibliography 6.2 Questionnaire

CHAPTER-1
Introduction & Design of the Study

1.1 INTRODUCTION
In this chapter various accepts of study are going to be discussed. To which area of management that study belongs to and various concepts that are related the area of study. The present outcomes under marketing and deals in the specific with the distribution network and its management. PEPSI COLA was in India from 1956-61 and left the country, as its products were not acceptable by the Indian customers. But recently in 1990 it re-entered the Indian market, where by PEPSI FOODS LIMITED was entered into a joint venture with PEPSI INTERNATIONAL, TATA and VOLTAS. PEPSI Bottlers and Producers of soft drinks buy concentrate and sell at fixed price and add a margin rationally for its products.

1.2 NEED OF THE STUDY
In modern days, market plays a vital role in rapidly changing industrial scenario. The marketing decline is under going reappraisal in the light of vast goals, technological, economic and social changes being faced by the today companies. The order to known the changes in the field of marketing it are necessary to conduct market survey. Study is conducted considering the following accepts: Firstly, visage is a representative of soft drink market which is highly promoting with a lot of potential which is at to be tapped. Secondly the behavior of the retailer is very much influenced by the additional benefits he is getting for selling the products having. Thirdly to understand the market condition of the soft drinks in the present scenario and the competition level in the market. Considered the key role of the retailer in present day market as an attempt was made to study the impact of company’s schemes of offering coolers to the retailers.

1.3 SCOPE OF THE STUDY
There is lot of scope for the further study in the project. Further study can be done in the following ways.  We can make a study on Pepsi and Cock companies’ efficiency in their promotion activities.  The same study can be conducted in other areas under bottling unit to generalize the finding for entire area under it.  There is chance to know whether the Pepsi and Cock are doing the right thing regarding the sales promotion, product quality, discounts and advertising.  A study on impact of visit coolers sales of Pepsi also be taken up.

1.4 OBJECTIVE OF THE STUDY
In view of intensifying competition in soft drink market, it is imperative that a brand keeps a constant, which on them market and response properly and promptly to the dynamics of the market. It is in view of this fact has the present study has been taken up for “PEPSI”.  To know and compare the merchandising of Pepsi and Cock in retail outlets.  To know the promotional activities of sales promotion, advertising and public relations.  To know the strategy of Pepsi and its competitors regarding the Marketing Mix.  To know the problems of retailers regarding the trade schemes and consumer offers.  To identify the retailers opinion towards Pepsi products.  To know the problems of retailers and to offer the suggestion for improving in sales.

1.5 METHODOLOGY Introduction:
In this chapter, basically the methodology, by which the report has been prepared, is explained. The exact need for conducting the study and total design of framework of the report prepared is discussed. The limitations of the study are also discussed here. According to the survey beverages can be classified into two segments. The first segment can be done basing on the milk content, like milk based products like tea, coffee, flavoured milk, and health drinks (milk, malt and coco) and the second segment can be done on non-milk products such as soft drinks and mineral water. According to the survey conducted on the consumption of beverages, Tea comprises 90%, filtered coffee 4%, beverages 2%, instant coffee 2% and carbonated soft drinks just above 1% of total consumption. Soft drinks industry is a well known consumer product industry. It originated in the year 1772. In the USA first bottled soda was manufactured, by inventing a machine in 1809, the manufacturing of carbonated soft drink was recorded in the history of soft drink industry. Now a days soft drink industry is growing very extensively and millions of people are consuming soft drinks everyday. Age, income, and climate are not at all a barrier for the consuming soft drinks by the people. This is the reason for the tremendous growth in soft drink market. Data which is required for the analysis and fulfillment of our objectives has been collected from two sources. They are 1. Primary sources 2. Secondary sources PRIMARY DATA: Primary data is collected from the retailers through a structured questionnaire. It includes the first hand information from the outlets. It can view as a survey. The questionnaire was especially designed to find out the market share of the soft drinks and problems and weakness of Pepsi in that particular area. The chapter deals with main analysis part of the study and the dealer outlets covered in the study is

 Srikakulam  Narasannapeta  Amadalavalasa

SECONDARY DATA
Secondary sources include the information collected from the annual reports, published and unpublished records of the company .various books and journals and internet also being used for collecting the relevant data After gathering the data from those two sources the data was analyzed, tabulated and interpreted and finally suggestions were offered for the betterment of the company.

DATA ANALYZING TOOLS:
After gathering the data from the Primary and secondary sources the data was analyzed ,tabulated and interpretations were written down with the help of graphs and charts , with the help of Microsoft Excel and Microsoft Word.

1.6 LIMITATIONS OF THE STUDY
The present study is subject to the following limitations:  The sample size is not universal , some part of other cities remained uncovered  Unavailability of some information due of lack of awareness of retailers  Time and expenses were major constraints  The study of the soft drink industry which is known to be seasonally fluctuating on e percent study does not take into account seasonal fluctuations. The results may not suit for all the seasons  Personal basis may be existing as the dealer of varied nature elicits the information

Chapter-2 Company overview

2.1 INTRODUCTION
In this chapter, an over of all the major accepts related to the study is discussed. The total industry profiles the soft drinks industry globally and in our country. The profile of the company with respect to its operation number of franchises, market share of the company and many other factors would be discussed here.

2.2 INDUSTRY PROFILE
Non alcoholic soft drink beverage market can be divided into fruit drink and soft drink. Soft drinks can be further divided into carbonated and non carbonated drinks. Colas, lemon and oranges are carbonated drinks while mango drinks come under non-carbonated drinks. Cola, lemon and oranges are carbonated drinks while mango dinks comes under non-carbonated category. The soft drinks market till early 1990’s was in hands of domestic players like Coke, Thumps Up, Limca etc. but with the opening up of economy and coming of MNC players Pepsi and Cock the market has totally under their control. Worldwide, Cock is the leader in carbonated drinks market. In India it is Pepsi, which scores over cock but this difference is fast decreasing. Pepsi entered Indian market in 1991. Cock reentered (after they were thrown out in 1977, by then central government) in 1993. Pepsi has been targeting the youth and the sales have been doing well by sticking to this youth segment. Cock on the other hand struggled initially in establishing itself in the market. In a span of 7 years of its operations in the country it changed its CEO four times they seem to have started understanding the pulse of Indian consumers. Soft drinks are available in glass bottles, aluminum cans and PET bottles for home consumption. Fountains also dispense thin in disposable containers.

SEGMENTATION:
The soft drink market can be segmented on the basis of place of consumption and on the basis of type of products. The segmentation on the basis of place of consumption divides the market into three parts: 1. on-permise-80% of the consumption of soft drinks is on premise i.e. restaurants, railway stations, cinemas etc, 2. At-home the rest 20% of the market compromise of the soft drink purchased for consumption at home. The market can also be segmented on the basis of types of products into Cola products and non-cola products. 1. cola products account nearly 62% of the total soft drinks market. The brands that fall in this category are Pepsi, cola, Thumps Up, Diet Pepsi etc. 2. non-cola segment, which constitutes 36%, cam be divide into 4 categories based on the type of flavour available, namely  Orange  Cloudy lime  Clear lime  Mango I. Orange flavour based soft drinks constitutes around 17% of the market. The segment is largely dominated by national brands like Fanta of Coca-cola Co. and Mirinda Orange of Pepsi Co. rest of the market is in hands of smaller brands like Crush (earlier Cadbury Schweppes and now of Coca Cola), Gold Spot etc. II. Cloudy Lime flavour constitutes 14% of the market and is largely dominated by Limca of Coca Cola and Miranda Lemon of Pepsi Co.

III. Clear Lime this segment of the market witnessed good growth initially with all; the players launching their brands in the segment. But now the growth in the segment has slowed down. The brands available in this segment are 7 Up , Mountain dew of Pepsi, Sprite of Coca-Cola and Canada Dry( earlier of Cadbury Schweppes and now of Coca Cola). The segment constitutes 3% of the total soft drinks market. IV. Mango flavour segment constitutes 2% of the total soft drinks market and it directly competes with mango based fruit drinks like Fruity. The leading brands in this segment are: Maaza of Coca Cola and Slice of Pepsi. There is very thin line of difference between the clear and cloudy lime. The most obvious feature is that clear lime has to be bottled in green bottles as sunlight harms the drink and changes the taste. There are some small local brands at city or regional levels. Most of these are either merging with two big players (Coca Cola and Pepsi) or they command a very small –less than 3% of the total market in their respective areas. Soft Drink Production Area: The market preference is highly regional based, while Cola drinks have main market in metro cities and northern states of U.P, Punjab, Haryana, etc... Orange flavoured drinks are popular in southern states. Sodas too are sold largely in southern states besides the Bars. Western markets have preference towards mango-flavoured drinks. Growth Promotional Activities in Soft Drink Industry: The government has adopted liberalized for the soft drinks trade to give the industry a boost and promote the Indian brand internationally. Although the import and manufacture of international brands like Pepsi and Cock is enhanced in India the local brands being stabilized by advertisements, good quality and low cost. Buying Behavior in Soft Drink Industry:

 Soft drinks come under the category of products on impulse. This attitude of impulse buying is slowly changing to occasion-led buying and also to some extent consumption through home refrigeration particularly in urban areas.  The market is slowly moving from non alcoholic carbonated drinks to fruit based drinks and also to plain bottled water due to lower price and ready availability.  Consumers purchase soft drinks primarily quench thirst therefore people traveling and not having access to hygienic water reach out for soft drink. This accounts for a large part of the sales.  Brand awareness plays a crucial rule in purchase decisions.  Availability in the chilled from also plays a crucial role in purchase decisions. This has made both the companies to push its sales and to increase its retail distribution by offering Visi cooler to retailers.  Why there is no aversion to consumption of soft drinks buys any age group, the main consumer of this market are people in the age group of 30 and below.  Product differentiation is very low, as all the products taste the same. But brand loyalty is high in the case of kids and people in the age group of 20-30 years.  According to NCAER survey, lower, lower-middle, upper-middle class people do 91% of the total consumption of soft drinks in the country.

Growth promotional activities in soft drink industry:
The government has adopted liberalization for the soft drink trade to give industry a boost and promote the Indian Brand internationally. Although the import and manufacture of international brands like Pepsi and Coke is enhanced in India .The local brands are being stabilized by advertisements, good quality and low cost.

Buying Behavior of soft drink industry:

Soft drinks come under the category of products on impulse. This attitude of impulse buying is slowly changing to occasion-led buying and also to some extent consumption through home refrigeration particularly in urban areas.

• • • •

The market is slowly moving from alcoholic carbonated drinks to fruit based drinks and also plain bottled water due to lower price and ready availability. Consumers purchase soft drinks particularly to quench thirst and therefore on travel not having access to hygienic water reaches out for soft drinks. Brand awareness plays a vital role in purchase decisions. Availability in the chilled form also plays a crucial role in purchase decisions. This has made both the companies to push its sales and to increase its retail distribution by offering Visi coolers to retailers

• • •

Why is there no aversion to consumption of soft drinks to any age group, the main consumers of this market are people in the age group of 30 and below. Product differentiation is very low, as all the products taste the same. But brand loyalty is high in the case of kids and people in the age group of 20-30 years According to NCAER survey, lower, lower-middle ands upper-middle class people do 91% of the total consumption of soft drinks in the country.

Major Players in Soft drinks Industries
The two global majors Pepsi and Coca Cola dominate the soft drink market in India. Coca Coal, which would up its operations during the introduction of the FERA regime, reentered India 16 years later in 1993. Coca Cola acquired a major chunk of soft drink market by buying out local brands Thumps up, Limca, Maaza and Gold spot from Pearl beverages, Coca Cola has also acquired Cadbury Schweppes soft drink brands Crush, Canada Dry and Sport Cola in early 1999 and now recently in Oct.2008 .It acquires distribution rights of these brands from IFB Agro Ltd . Pepsi stated a couple of years before Coca Cola manufactures came up with their own market share figures and claimed to have increased their share.

Shares Reports On Retailers In Soft Dink Industry:
A Survey was conducted to study the retailer’s view of the present market, future trend and the consumer behavior patterns. The findings of the survey are as follows. • Retailers started that the consumers are loyal to the particular segment of the soft drink i.e. Coca Cola, Orange or Lemon. But as for the loyalty for the brands in each segment is concerned, it is not very significant. • 43% of the retailers surveyed told that in the soft drink industry advertising is the key component, it drives sales. While 32% stated promotional schemes and 20%brand loyalty as the reason. • As consumers are not very brand loyal where the purchase of the soft drink purchase is concerned, the retailer purchase becomes a critical issue. They usually sell the product in which they get maximum benefit. For this, the companies try to offer them higher margins. While distributors get the margin of Rs 8-9 per crate (1 crate is equal to 24 bottles) at 3-4% of MRP, retailers are given margin of 10-12 % of MRP. The retailers are not happy with this, as the cost of refrigeration very high for soft drinks to overcome this problem the companies are offering Visi coolers schemes to their main retailers

2.3 ORGANIZATION PROFILE

PEPSI COMPANY MISSION STATEMENT: Pepsi Company’s over all missions is to increase the value of their share holder’s investment. they believe that their commercial success depends up on offering quality and value to their consumers and providing products that are safe, whole some and economically efficient and environmentally sound. Providing a fair return to their investors, while adhering to the highest standards of integrity.

HISTORY OF PEPSI AND COCA COLA COMPANY:
Pepsi Co Inc. was founded by Donald M. Kendall, President and chief executive officer of Pepsi –Cola and Herman W. Lay, Chairman& Chief executive of FRITO-LAY through the merger of two companies in the year 1965.

MAJOR PRODUCTS OF THE NEW COMPANIES ARE:
• • • Pepsi-Cola company Pepsi-Cola(formulate in 1898) Diet Pepsi(1964) Mountain Dew (introduced by T.P corporation 1984)

• • •

Frito-Lay Inc brand chips Lays brand potato chips Cheetos brand chew flavoured snacks Ruffles brand potato chips & Rold Gold brand pretzels Pepsi Company Inc. is among the most successful consumer products company in the world with: 1998 revenues of over $22 billion &1, 51,000 employees. Pepsi company’s brand names are among the best known & most respected in the world .Some of the Pepsi Company’s brand names are 100 years old. FRITO-LAY Company is the world’s largest manufacturer and distributor of snack chip and Tropicana products Inc. is the world’s largest marketer and producer of branded juices.

Pepsi Company’s success is the result of • • • • Superior Products. High Stands of Performances Distinctive Competitive strategies. High integrity of its work force

PEPSI-COLA COMPANY:
Calets Bradham, New Beru and Mc.Druggist who first formulated Pepsi coal founded Pepsi Company’s beverage business at the turn of the century. Brand Pepsi and other Pepsi-cola products including Diet Pepsi one, Mountain Dew, Slice and mug brands account for nearly 1/3 rd of the total soft drink in United States. Outside U.S Pepsi Cola Company’s soft operations include the business of 7up international. Pepsi-cola beverages are available in about 170 countries. Key Pepsi-cola international market includes Argentina, Brazil, china, India, Mexico, Philippines, Saudi Arabia, Spain, Thailand, and the United Kingdom.

Pepsi-cola provides advertising, marketing sales and promotion support to the Pepsi-cola bottles. New advertising and existing promotions keep Pepsi-cola young. The company manufacture and sales of the soft drinks are concentrated to the Pepsi-cola bottles. • • In 1996, Pepsi entered Japan and Eastern Europe. In 1967, PepsiCo. Stock splits two-for one.

In 1986, North America van lines (NAVL), a premier transportation company Pepsi co, and renamed a strong contribution to the Pepsi unit it has divided in 1984. In 1969 in bold modern Pepsi cola packing which was using red, white and blue were introduced. FRITO-LAY introduced fungus brand onion flavoured snacks. In 1970 Pepsi introduces the industry’s first two litter bottles. Pepsi is the first company to respond to consumer preference with light weight, recyclable, plastic bottles. In 1971 Andral E. Pearson was appointed as president of PepsiCo, a position he held until his retirement in 1984.in 1972 don Kendall announced agreement making Pepsi cola the first foreign product sold in U.S.S.R. Pepsi co is given exclusive rights to import Stolichnaya Russian vodka in the U.S. In 1973 and 1974 Pepsi-cola became the first American consumer product to produce made and sold in former Soviet Union. In 1975 Pepsi Lite, with destructive lemon taste, is introduced as an alternative to traditional diet colas. In 1976 PepsiCo adopts code of worldwide business conduct. Pepsi-cola became the single largest selling soft drink brands sold in U.S super markets. In 1977 PepsiCo shares spilt up three for one. In 1987 and 1979 the opening of PepsiCo research and technological center in Vallah N.Y PepsiCo reached 85 billion marks in sales. Pepsi was formed to focus on the overseas development of restaurants. In 1981 PepsiCo fitness center was completed, making PepsiCo, one of the most advanced companies in the area of employee’s health and fitness. In 1982 Pepsi free and diet Pepsi free, the first major brands caffeine free colas were introduced.

Inauguration of the first Pepsi cola operations in china:
In 1983 The Bottler Hall of Fame was established to recognize the achievement and dedication of international bottlers. In 1984 diet Pepsi is reformulated with 100% neutral sweet, slice and diet slice. The first major soft drinks sirucsare added in Mexico. The cola were takes “one giant spilt for

mankind” when a Pepsi “space can” is successfully tested a brand the span shuttle. 1986 Pepsi company board of directors visit the peoples public of china to make the opening the Pepsi second plant in china. In 1989, Pepsi Company introduce share power stock option program for all employees becoming the first large corporation tool award stock options through virtually all full time employees. In the 1900, Pepsi company was recognized as one of the most admired corporation by the fortune magazine’s top 10 for the two successive years. Pepsi signs the largest commercial trade agreement in history with the Soviet Union expecting sales in the USSR to double by the end of the century. Pepsi re-entered the Indian market in collaboration with Punjab Agro industries Corporation (PAIC). In 1991 Pepsi company named one of the fortune magazine’s top most admired corporations, for the third year in also. Pepsi co. purchased an equity position in the carts of Coloreds Inc. the leading manufacturer and marketer of mobile merchandising equipment. It was sold in 1955. 1993 Pepsi Cola began the distribution of Lipton’s line of ready to drinks teas nationwide. in 1996 Pepsi started its website WWW.Pepsi.com SOCIAL RESPONSIBILITY OF PEPSICOLA COMPANY: As a consumer products company, Pepsi Company does not have the major environmental problems of heavy industry. Their biggest environment challenge is packaging generated by their products. Packaging is important to public and a critical component of the distribution system is to deliver products to consumers and commercial establishment. To meet both consumer demand and safe guard the environment, they recycle, re-use and reduce packaging wherever possible. Each business is also committed to responsible use of resources required in manufacturing their products.

LOGOS OF THE COMPANY

2.4 ABOUT PEPSI INDIA COMPANY
Franchise (pearl Bottling Pvt.Ltd.,)
Often new flavours are to be added to the product line of cool drinks to prevent a competitor. To establish a relation with retailers it is desirable to sell more than one flavor of cool drinks. To decrease the security seasonal products are added to the resources available so as to lessen its risks. Pepsi has given the franchise of Visakhapatnam region to Pearl Beverages which belongs to Pearl Group with Head quarters at Delhi and Mr. C.K. Jaipuria as the chairman and the Managing Director of the group. Pepsi Foods Ltd., declared Krishna Mohan Beverages and Constructions as franchise, in 1992.Last year it was changed to Pearl Beverages was taken by the Pearl Group. Campacola Soft Drinks has originally owned the premises since 1980 at Madhurawada. After the insolvency of campa-cola, KMBC purchased the premises in1990 in the auction by APSFC. Initially, it used to produce Mc.Dowell’s soda and Bagpiper soda. It produced these drinks under franchise agreements but company could not exist in the market due to stiff competition from pearl products.

Description and Launch of products
Brand name Pepsi Mirinda 7 Up Mirinda Lime Soda Flavour Cola Orange Clear Lemon Cloudy Lemon Soda Date April-1992 April-1992 April-1992 April-1992 April-1992

Pepsi Coca-cola

Pepsi Dite Cock Dite

7 Up Sprite

Mirinda(o) Fanta

Mirinda(L) Limca

Slice Maaza

Evervess soda Kinleys

Pepsi market share:
Pepsi : 47%

Coca-cola : 53%

Pepsi foods (Pvt.) Ltd.
Pepsi cola was in India from 1956 to 1961. it left this country, as its products were not found acceptable to the Indian market. Pepsi foods Ltd. Joint venture between Pepsi Co. international of US(which is holding 40% of the equity)and Tata concerns Voltas and the Punjab Ago industries Corporation (each of which have as round 25% of the equity),has 25%of its output reserved for beverages with a 50% export commitment fo9r fruit and vegetable products. According to Pepsi officials the project guarantees that for every American dollar the company takes out of India, it will bring five back. They started concentrated factory in Punjab. This company named as Pepsi Foods Ltd. Pepsi Co. international’s direct investments in India so far amounts to Rs.165 corer. Two thirds of this however has gone into food processing. Pepsi foods are exporting fruits and vegetables to UK etc.

The Pepsi’s foods processing unit directly supervised 1,200 hectors under tomato cultivation covering 183 villages and 319 farmers. The company’s technical inputs enabled the farmer to achieve a yield of 35 to 50 tones a hector against the average of was after discontinuing teems. KMBC Pvt. Ltd. Has was the bottle for five districts Vizag, Vizianagaram, Srikakulam, and East Godavari & West Godavari. It receives the stock from Cuttack.

PRODUCT PROFILE
The Pepsi Co. is known for the development and introduction of world-class brands & products. Their portfolio is organized into three core business, which consists of snacks, Beverages and Restaurants. Pepsi products are constantly changing themselves to develop new products. They encourage consumer to explore their wide range of brands.

Main objectives:
The objectives of the company set out in memorandum of association and franchise agreements are as follows:  To manufacturing soft drinks by concentrating supplied by Pepsi Foods.  To market and advertise within specified areas for Pepsi products.  To sell soft drinks at fixed prices.

financial structure:
To start and operate business, any company has to invest its capital in fixed assets and floating assets and also in meeting the daily requirements of the company. However, depending on the nature of business and product being offered by the company, the ratio of investment of capital in fixed and floating assets differ. Working Capital:

It means capital required for daily management of the company eg. Wages, salaries, canteen expenses and transportation expenses etc Plant layout: the machine and equipment have been imported from Germany, which are arranged in the plant according to the sequence of operation. All the operations are carried on a continuous movement. The reasons for choosing the product layout are: 1. There is continuous supply of material. 2. The brands are all standardized products. 3. The demand for the product brands is reasonable stable. 4. The volume of production is adequate for the reasonable utilization of equipment. Since the company follows continuous operation movement, the cost of material handling goes low. The total floor space required by the machine is less than other types of plant layouts.

Plant Capacity:
The company installed latest up to date automatic plant conforming to plant layout. The installed production capacity is 400 bottles per minutes i.e. 24,000 bottles per day. The plant also is having 100 bottles per 1-leter line. During off-season the plant runs one shift. The company has to produce enough bottles of soft drinks at a speed to keep in space with the disappearance of soft drinks form shelves of the retailer.

Production Schedule:
The production schedule is fixed by taking into consideration.  The present or current market demand.  The availability of empty bottles.  The inventory position filled bottles of different flavors.

The production schedule for each brand is fixed daily, filling the bottles of each branded flavors. This has an advantage in manufacturing the branded product is one at a time.

Quality control
Pearl Beverages Pvt. Ltd. takes great care to maintain the quality control of the products in their factory. The Bottles are visually examined for impurities continuously, as the bottles move out. Samples are checked every ten minutes of production time by the chemist for its quality and hygiene condition. The chemical analysis is also made for flavors, gas content and sugar percentages. The appearance, smell and taste of the products are also checked. If any defects are noticed, the production is suspended and the correcting measures are taken so as to set right the bottling process irregularities. Further, samples from each batch are dispatched to the affiliated parent agency company in each week for quality checkup. Moreover, agency of the company also lifts sample form the market at the random for quality checkup at any time to make sure that the quality is maintained to the exact standard of the parent company. At the end of the production schedule, daily all the equipment floor and wet patches are cleaned with bleaching powder or some other solution. The standards of hygiene maintained inside the production shops are commendable.

Organization Structure and management:
The word organization has two common meanings. The meaning signifies an institution or function as group and the second meaning refers to the process of organizing the way of work which is arranged and allocated among members often organization so that the goal of the organization can be achieved efficiently. The organizing involves balancing the companies. Needs both for stability on one hand and change on the other hand, an organization structure means adopting a change or it can be a source of resistance to change. There are mainly five elements of organization structure.  Specialization of activities.  Standardization of activities.  Coordination of activities.

 Centralization and decentralization of deviation making.  Size of the work unit. The M.D, Mr. Ruchirans Jaipuria is athe head of the organization and administration. The company is managed by able director, and is assisted by a team of well-qualified & experience senior management personnel.

LIST

OF

THE

EMPLOYEES

IN

PEARL

BOTTELIGN

COMPANY
The following table shows the description of employees along with designation & no. of employees:

S.No 1 2 3 4 5

Description GENERAL MANAGER (FINANCE) COMMERCIAL MANAGER MARKETING DEVELOPMENT MANAGER VICE PRESIDENT TERRITORY DEVELOPMENT MANAGER

No. of employees 1 1 1 1 4

6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

ACCOUNTS DEVELOPMENT MANAGER TRAINING MANAGER ADMINISTRATIVE MANAGER MARKET EQUIPMENT MANAGER PRODUCTION MANAGER ASST. PERSONAL MANAGER STORE EXECUTIVES CUSTOMER CENTRAL EXECUTIVE TERRITORY C0-ORDINATOR ROUTE AGENT SALES TRAINEE CHEMIST ACCOUNTANTS SUPERVISOR CLERKS OPERATORS ELECTRICIANS FITTERS COMPUTER CUM TELEPHONE OPERATORS SECURITY OFFICER SECURITY GUARDS OFFICE BOYS SWEEPERS & HELPERS

1 1 1 1 1 1 3 25 1 50 1 3 5 8 8 10 10 3 12 1 6 13 3

CHAPTER-3

Theoretical Framework

3.1 INTRODUCTION
The main part of the report i.e. Analysis part is covered in this chapter. I did survey in 300 outlets in 3 various areas. After conducting the survey I interpreted the total collected information using a structured questionnaire. The required information is derived from that interpretation and analysis. This analysis part contains tables and pie charts. We can come to a conclusion from the final information from this chapter. Because of that reason this chapter is very important in the entire study of the project. Without this interpretation we can conclude the total survey and also can not understand the position of any company and the opinion of the customers regarding the company.

3.2 DETAILS OF THE AREA SURVEY CONDUCTED
Details of the survey conducted:

The total data collected in three areas in Srikakulam district of total of 300 retail outlets. They are given below: CLUSTER Cluster-1 Cluster-2 Cluster-3 SAMPLE SIZE 130 90 80 AREA Srikakulam Amadalavalasa Narasannapeta

I started my survey first at Srikakulam on 4/02/09 and my study completed on 18/02/09 with Amadalavalasa. I personally went to every outlet and asked the total details of which are in the questionnaire and filled those things. Some of the retailers denied giving the details and I waited there with patience and collected all the data. In my survey I learned a lot and collected the useful information and also got good experience in the market field and came to know many things which are not in our books through this survey. I almost covered all the retail outlets which are situated in these areas and collected the correct information.

3.3 INTERPRETATION OF THE SURVEY
[TABLES AND GRAPHS]

1. Pepsi & Cock Brands Available In Various Markets:
S.No 1. 2. 3. Market Srikakulam Amadalavalasa Narasannapeta Pepsi 5 5 5 Cock 6 5 7

Average Pepsi & Coke Brands Available in Various Markets
8 7 6 5 4 3 2 1 0 Srikakulam 1 Amadalavalasa 2 Narasannapeta 3

Pepsi Coke

Average Pepsi & Cock brands Available in the market:
Brands No Pepsi Coca-Cola 6 5.8 5.6 5.4 5.2 5 4.8 4.6 4.4 Pepsi Coca-Cola No of Types

of Pepsi & CokeNo of Typesavailable in Average brands
5 6

INTERPRETATION: In my survey of 300 retail outlets in 3 areas, I found 5 brands of Pepsi out of its 10 brands and 6 Brands of Coke is available out of its 10 Brands on average. So the brand availability of Coke is more when compared to Pepsi.

Top brands Available in Srikakulam Market:
S.No
1. 2. 3. 4.

Brands
Slice Mirinda Sprite Limca

Percentage
46 24 20 10

Top Brands Available In Srikakulam Market

Limca Sprite Percentage Mirinda Slice 0 10 20 30 40 50

1

2

3

4

Top Four Brands Available In Amadalavalasa Market:

S.No
1 2 3 4

Brands
Mirinda 7 Up Sprite Thumps Up

Percentage
46 24 17 13

Top Four Brands Available In Amadalavalasa Market

Thumps Up Sprite 7 Up Mirinda 0 10 20 30 40 50 Percentage

1

2

3

4

Top 4 Brands Available in Top Four Brands Available In Narasannapeta Market: Narasannapeta Market
45 S.No 40 35 2 30 25 3 20 4 15 10 5 0
1

Brands
Mirinda Sprite 7 Up Slice

Percentage
42 26 18 14

Percentage

Mirinda 1

Sprite 2

7 Up 3

Slice 4

Brands

2.No of Bottles Sold Per Day in Various Markets:

Srikakulam
Pepsi Coke 52 44

Amadalavalasa
45 35

Narasannapeta
42 50

No of Bottles sold Per day
60 50 40 Brands 30 20 10 0 Srikakulam Amadalavalasa Market Areas Narasannapeta

Average Sales % Per Day
3.No of Bottles sold per Day:
3

Brands
Pepsi Coke 2 55 0 45 0 0 10 20 Brands

No of Types
45 55

1

30 No of Types

40

50

60

INTERPRETATION:
In my survey of 300 outlets in three areas I found Pepsi is occupying 55% and the Coke is occupying 44% in the total market in average. From this we can understand that the Pepsi sales are more when compared to Coke.

4.Service required to the retail outlets:

Service Required from Companies
S.No 70
1 2 60 50

Market
Srikakulam Amadalavalasa Narasannapeta

Daily
63 49 55

Alternative Days
25 27 36

Weekly Twice
12 24 9 Daily Alternative Days Weekly Twice

% of occupation

3 40 30 20 10 0

Srikakulam 1

Amadalavalasa 2 Market Areas

Narasannapeta 3

Service Required in Average:
Types of Services
Daily Alternative Days Weekly Twice

Average Service Required from the Companies
55 30 15

Average Service Required from the Companies

Daily Alternative Days Weekly Twice

INTERPRETATION:
In my observation of 300 outlets in three areas I found that 55% of the retailers want the daily service, 30% retailers want Alternative Days and the remaining 15% of the retailers want the service weekly twice.

5. Satisfaction of Pepsi Service
S.No
1 2 3

Market
Srikakulam Amadalavalasa Narasannapeta

Good
60 65 70

Satisfactory
40 30 28

Bad
0 5 2

Satisfaction of Pepsi Service
70 60 50 40 % 30 20 10 0 Good Satisfactory Service Bad 1 Srikakulam 2 Amadalavalasa 3 Narasannapeta

Satisfaction of Coke Service
S.N0
1 2 3

Market
Srikakulam Amadalavalasa Narasannapeta

Good
45 40 45

Satisfaction
50 55 50

Bad
5 5 5

Satisfaction of Coke Service
60 50 40 % 30 20 10 0 Good Satisfaction Service Bad 1 Srikakulam 2 Amadalavalasa 3 Narasannapeta

Service of Pepsi & Coke
70 60 Percentage 50 40 30 20 10 0 Pepsi Brand Coke
Service Satisfaction of Pepsi and Coke in Average:
Good
65 43

Brand
Pepsi Coke

Satisfaction
33 52

Bad Good
2 5

satisfactory Bad

INTERPRETATION:

Trade Schemes
INTERPRETATION:
In my survey of 300 outlets I found that 65% of the retailers expressed good in case of Pepsi and 43% incase of Coke. 33% in the case of Pepsi and 52% in case of Coke expressed satisfactory and finally remaining retailers expressed bad to the service of the companies. 60 50 Percentage 40 30 20 10 0 Srikakulam 1 Amadalavalasa 2 Market Area Narasannapeta 3 70

6. Trade Schemes by Both Companies in Various Markets
Market
Srikakulam Amadalavalasa Narasannapeta

Pepsi Coke

S.No
1 2 3

Pepsi
41 49 41

Coke
59 51 59

Trade Schemes Given

Trade Schemes by Both Companies in Average
Brands
Pepsi Coke

Trade Schemes
44 56 Pepsi Coke

INTERPRETATION:
By observing the above pie chart we can understand that 56% of the traders expressed their happiness towards the schemes of the Coca-Cola and the remaining 44% traders expressed their happiness towards Pepsi company in case of their trade schemes.

7. Consumer Promotions offered by both Companies

S.No
1 2 3

Market
Srikakulam Amadalavalasa Narasannapeta

Pepsi
61 57 60

Coke
39 43 40

Consumer Promotions offered

Narasannapeta

Market Areas

3

Amadalavalasa

Coke Pepsi

2

Srikakulam

1

0

10

20

30

40

50

60

70

percentages

Consumer Promotions

Consumer Promotions offered in Average
Brand
Pepsi Coke

Consumer Promotion
59 41 Pepsi Coke

INTERPRETATION:

Do T.V Add Help in Sales increase?

In providing consumer promotion by way of giving the prizes to the consumers and other ways 80 promote the sales, Pepsi was able to attracted 59% of the retailers with its promotional to schemes. In case of Coke it attracted the remaining 41% of the retailers by their consumer promotional schemes and activities. 70 60 percentage 50

8. Is T.V Adds help to increase the sale of Soft Drinks
Market
Srikakulam Amadalavalasa Narasannapeta

S.No40
1 2 3 30 20 10 0

Yes
74 51 60

No
26 49 40

Yes No

Srikakulam 1

Amadalavalasa 2 Market Areas

Narasannapeta 3

T.V Add helps the increase in sales

Amount of people saying T.V ads help increase in Sale, in Average T.V Add helps the increase in sales
Yes N0 62 38 Yes N0

INTERPRETATION:

The above chart shows the opinions of the retailers that weather T.V ads will help to increase the sale of the soft drinks. In this 62% of the retailers expressed positively and the remaining 38% retailers expressed negatively to this question.

Comparison of 07-08 sales

70 60 50

9. Comparison of 2007-2008 sales
Market
Srikakulam Amadalavalasa Narasannapeta

percentage

S.No 40
1 2 3

Good
55 30 40

Less
40 63 48

Same
5 7 12

30 20 10 0

Good Less Same

Srikakulam 1

Amadalavalasa 2 Market Areas

Narasannapeta 3

No of outlets in average

Comparison of 2007-2008 sales in average
Opinion
No of outlets in average

Good
42

Less
50

Same
8 Good Less Same

INTERPRETATION:
In the above chart the opinions of the retailers were given. From that 42% of the retailers expressed the view of good increase in the sale by2008 when compared to 2007. 50%of the retailers expressed the view of less increase in the sale and the remaining 8% of the retailers expressed the view of the same sales and there is% of Jucie based no increase in the sales. 40 35

Soft drinks

10. The Percentage Of Juice Based Soft Drinks In Total Sales
Market Area
Srikakulam Amadalavalasa Narasannapeta

Percentage

S.No
1 2 3

30 25 20 15 10 5 0

30%
30 29 34

20%
33 34 32

10%
37 37 34 30% 20% 10%

Srikakulam 1

Amadalavalasa 2 market Area

Narasannapeta 3

Jucie based soft drinks in Average
Juice Based Soft Drinks In Average
30%
Result 31

20%
33

10%
36 30% 20% 10%

INTERPRETATION:

Coolers Availability in Various Markets

By observing the above chart we can understand that the demand for the juice based soft 90 drinks is increasing rapidly. For that the companies better to concentrate on the juice based soft drinks 80 introducing and their sales. 70

11. Pepsi Visi coolers and other coolers available in the Market

Percentage

60 50

S.No40
1 2 3 30 20 10 0

Market
Srikakulam Amadalavalasa Narasannapeta Srikakulam 1

Pepsi cooler
32 21 31 Amadalavalasa 2 Market Areas Pepsi cooler Cock+ other coolers

Cock+ other coolers
68 79 69 Narasannapeta 3

Average of Outlets

Pepsi & Coke Visi Coolers Available in Average
Pepsi Visi Coolers
Average of Outlets 28

Cock Visi cooler+ Own cooler
72 Pepsi Visi Coolers Cock Visi cooler+ Own cooler

INTERPRETATION:
In the areas where I did my survey I found 28% of the retailers are using the Pepsi Visi Coolers and the remaining 72% of the retailers are using the Coke and Other coolers. From this we can suggest that Pepsi have to increase their Visi Coolers supply. 70 60

Why other products in Pepsi Visi Coolers

12. Why retailers keep other products in Pepsi Visi Coolers
Market Area
Srikakulam Amadalavalasa Narasannapeta

Percentage

S.No
1 2 3

50 40 30 20 10 0

Electricity Bill
35 58 56

No Own Cooler
65 42 44

Srikakulam 1

Amadalavalasa 2 Market Area Electricity Bill No Own Cooler

Narasannapeta 3

Why other products in Pepsi Visi Coolers in Average why other products in pepsi cooler in average
S.No
1

Electricity Bill
49

No own cooler
51

Electricity Bill No own cooler

INTERPRETATION:
When I did the survey I observed that many of the retailers are keeping the other products in Pepsi Visi Coolers and they gave some sort of explanation for that. In those reasons 49% of the retailers said Electricity bill is the problem and the remaining 51% of the retailers said that they don’t have their own coolers. They should be restricted.

Most soft drink consumig category

70

13. Most Soft Drinks Consuming Category In Various Markets
Market
Srikakulam Amadalavalasa Narasannapeta

S.no
150 240 3 30 20 10 0

60

Male
18 12 19

Female
10 11 18

All People
59 56 39

Youth
13 Male 21 Female 24 People All Youth

Srikakulam 1

Amadalavalasa 2 Market Areas

Narasannapeta 3

Most soft drinks consuming category in Avg
Most Soft Drinks Consuming Category In Average
Opinion
Avg % of outlets

Male
16

Female
13

All People
51

Youth
20

Male Female All People Youth

INTERPRETATION:
In the above pie chart the consumption of soft drinks mostly by four categories. 51% of the total consumption is by All People, 20% by the Youth, 15% by the Male and the remaining 13% is consumed by the Female. We can say that the consumption of soft drinks by the youth is increasing.

14. Soft Dinks Supply To The Retail Outlets
Soft Drinks Supply on Cash or Credit [Cash Or Credit]
120

S.No
100 1 80 2 60 3 40 20 0

Market
Srikakulam Amadalavalasa Narasannapeta

Pepsi Cash
100 100 100

Pepsi Credit
0 0 0

Coke Cash Coke Credit
100 100 100 0 1 Srikakulam 0 2 Amadalavalasa 3 Narasannapeta 0

Pepsi Cash

Pepsi Credit

Coke Cash

Coke Credit

Brands

INTERPRETATION:
From the above pie cart we can understand that both the Pepsi and Coke companies are not providing any credit to the retailers. All the retailers are purchasing the soft drinks on cash only. 90

Soft Drinks consumption Places 15. Consumption of Soft Drinks at Home and at Shop
Market
Srikakulam Amadalavalasa Narasannapeta

S.No
70 1 60 2 50 3 40 30 20 10 0 Srikakulam 1

80

At Shop
80 70 75

At Home
20 30 25 At Shop At Home

Amadalavalasa 2 Market

Narasannapeta 3

Consumption of Soft Drinks at Home & at Shop In Avg. Soft Drinks Consumption Places in Avg.
S.No
1

At Shop
75

At Home
25

At Shop At Home

INTERPRETATION:
From the above pie chart we can understand that in the areas I did the survey 75% of the Soft Drinks are consumed at the Shops and the remaining 25% of the Soft Drinks are consumed at Home.

Chapter-4
SUMMARY, FINDINGS & SUGGESTIONS

4.1 INTRODUCTION
The chapter contains Findings, Suggestions and Conclusions. Basing on the results of the survey Suggestions are given to improve the potentials and the market share of the company in the soft drinks field. The total findings are prepared by the survey information collected in the various places in Srikakulam district. I did the comparative study between the top two brands in the field of soft drinks sector those are Pepsi and Coke. The information is base

on the two brand comparison and in my view these are useful to the company to improve its performance and can get good sales as well as good market share in the field of Soft Drinks. These are all my sincere findings and suggestions to the company.

4.2 FINDINGS

1) The company is maintaining the quality of the products and it has good quality control Dept. 2) Now a day because of changing the food habits the soft drinks are added to their food habits. 3) Pepsi soft drinks are occupying more than half of the soft drinks market.

4) The demand for the fruit based soft drinks is go on increasing and they occupied the top selling drinks position. 5) Sales promotion activities taken by the Pepsi Company is good as per the retailer’s opinion when compared to coke. 6) The Pepsi Company’s supply of drinks is good but they are not providing the sufficient drinks to the outlets. 7) The No. of Visi coolers in the market is less when compared to the Coke Company. 8) Some of the retailers are placing the other products also in the company coolers. 9) Pepsi company’s offers to the retailers are not good in the view of the retailers. 10) The dealers are not giving the proper information about the new products and the new offers given by the company. 11) The retailers are not provided any credit on the purchase of the drinks in the case of both companies. 12) Advertisements for every drink are given individually, because of that the consumers are not aware of the total drinks offered by the company and the expenses will more for the company.

4.3 SGUUESTIONS
1) The company has to increase its quality more and also has to introduce more verities of drinks in to the market to increase its market share.

2) It has to change the advertisements in a manner that add the soft drinks as a part of food. 3) The Pepsi has some more scope to increase its market share and it has to strive for that. 4) Company has to concentrate on the fruit based drinks and add some more fruit based drinks to the product line. 5) The Pepsi Company has to increase the No. of Visi Coolers in the market. 6) The retailers are using the Pepsi Visi Coolers for other drinks also, they have to control that. For that purpose the company has to recruit some people. 7) Pepsi Company has to increase the trading offers to the retailers. 8) The dealers should provide the sufficient information to the retailers about the products and the new offers to the retailers provided by the company. 9) The dealers should be provided the credit up to some limits by the company. 10) The Advertisement should be given as a whole, that will bring the awareness about the products and reduce the advertisement cost of the company also.

4.4 CONCLUSION
The project was a great experience for me in order to study the marketing aspects in the world. It was a great opportunity for me to express what I have studied. This industry is a place where two major players are there in the world. This Pepsi Company gave me lot of opportunity and scope to understand the soft drink industry and its marketing structure and distribution channels. Lot of voluble information regarding the company and also the retailers, has been collected from the survey, which helped me clearly to understand the real problems faced by the marketers to distribute and also make retailers to sell

the company’s products in the market. I understood who difficult to do the marketing in the present scenario. The suggestions made to the company were really applicable for the growth and benefit for the company in order to increase its market share and to become the market leader in the soft drink industry, because a large number of competitors craving for the same market. Thus, finally it can be said that the industry needs a lot of channel management activities to done along with various promotional strategies for the customers. I wish the company to achieve its objectives achieved soon.

BIBILOGRAPHY
S.No Author Title Publisher Volume Year

1.

Philip kotler

Marketing Management

Prentice, Hall of India Mac Millan Biztantra Hall of India

12th

2005

2. 3. 4.

VS Ram Swami Joel R. Evans Berry Berman Chunawalla S.A

Marketing Management Marketing Advertising

3th 8th 12th

2005 2005 2005

Web Sites Referred:
WWW.Pepsi.com WWW.marketingteachers.com WWW.coke.com

QUESTIONNAIRE
Name of the Student: College & Town: Date of Survey:

1.

Name of the shop/owner: A. Address: B. Phone:

2.

Which company drinks are available in your shop: Pepsi 7 Up Evervess Soda Mirinda orange Mountain Dew Diet Pepsi Mirinda Lemon Slice Aquafina Water

Total 3. Coke Company drinks available in shop: Thumps Up Sprite Limca Diet Coke 4. Fanta Kinely Water Maga Total Coca- Cola Kinely Soda Minute Made

Top brands Purchased by consumer in your shop? 1st ______________ 3rd ______________ 2nd ______________ 4th _______________

5.

Your Sales in Bottle per day_________________ bottles A. Pepsi Bottles Sold________________ B. Coke Bottles sold_________________

6.

Do you require Service by drinks Company as follows A. Daily B. Alternate Days C. Weekly 2 times

7.

Are you satisfied with Pepsi Service? A. Good B. Satisfactory C. Bad

8.

Are you satisfied with Coke Service? A. Good B. Satisfactory C. Bad

9.

Trade Schemes offered by which company is good to you?

Pepsi 10.

Coke

Consumer Promotions offered by which company is best, what is Pepsi present Consumer promotion? Pepsi Coke

____________________________________ 11. Do you feel T.V advertisements by drink companies help in more sales of Drinks? Yes 12. No

How are sales of drinks this year Vs 2008 in your shop? Good Less Same

13.

What is Percentage of juice based soft dinks sales in your shop? 30% 20% 10%

14.

Condition of Pepsi Visi Cooler? Full of Pepsi Drinks Full of Pepsi+ Coke Drinks Pepsi Drinks+ Other Packs

15.

Why do you keep other products in Pepsi Cooler?

Electrical Bill No Own Cooler 16. What is the percentage contribution of soft drinks business in your total business? _____________________________ 17. What is the shop keeper suggestion to improve Pepsi Company Sales in 2009? ______________________________________________________________ 18. Soft Drinks are consumer by mostly? Male Female By All By Youth

19.

How do you (Retailer) buy soft drinks? Pepsi Coke Cash Cash Credit Credit

20.

What is the percentage of sale of drinks at your shop and consumer residence? Shop Home

2001 Milestones

Pepsi-Cola

Company

launches

Dole

single-serve

juices

in

vending

machines, coolers and other retail outlets throughout the United States.
• •

Pepsi-Cola's flagship brand will have new tagline, "The Joy of Pepsi." Tropicana celebrates a company milestone - 300 billion fresh oranges squeezed since the company began making country are first ever mass distributed, not-from-concentrate juice in 1947. Tropicana introduces Smoothies. A natural juice-based product, smoothies combine fruit juices and non-fat yogurt into a smooth, filling drink that delivers nutrition, taste and convenience.

Pepsi-Cola launches the bold new Mountain Dew Code Red nationwide. It is Mountain Dew's first line extension since the introduction of Diet Mountain Dew in 1988. May 2 -The Board of Directors of PepsiCo, Inc. elected Steven S Reinemund chairman of the board and chief executive officer, succeeding Roger Enrico who will become vice chairman. The board also elected Indra K. Nooyi as a director and gave her the additional title of president of PepsiCo in addition to CFO. Frito-Lay introduces Lay's Bistro Gourmet potato chips. Pepsi-Cola Company introduces a "Pepsi Twist." Regular and diet versions of the crisp new cola with lemon are entering retail outlets in selected U.S. markets. SLAM, the orange brand Mirinda, is launched in Italy. PepsiCo acquires Tasali Foods, Saudi Arabia's leading snack company. On August 2, PepsiCo merges with The Quaker Oats Company, creating a $25 billion food and Beverage Company focused on the rapidly growing consumer demand for convenience. Tropicana Pure Premium Low Acid orange juice makes official debut at Tropicana 400. Diet Sierra Mist is introduce

• •

• • •

2002 Milestones

Gatorade introduces new Gatorade ICE in three flavors- Orange, Lime and Strawberry.

Tropicana Pure Premium announces sponsorship of Disney's award-winning show The Lion King. Tropicana® Pure Premium® introduces 14-oz. single-serve resealable bottle you can take with you for the on-the-go- consumers. Diet Pepsi has a new look. "Mr. Green," a green-tinted carbonated soft drink with caffeine and ginseng, is launched under SoBe's New Age beverage line in April. The North American Coffee Partnership (NACP), a joint venture between Starbucks Coffee Company and PepsiCo, Inc. introduces Starbucks Doubleshot. Quaker Oatmeal this year celebrates the 125th anniversary of the nation's number-one-choice for a nutritious, hot breakfast cereal. Gatorade turns 35. It was created in 1960s to help performance of Florida Gators football team and now is the leading sport drink. New line of Gatorade brand drinks, Xtremo, comes in three new flavors Mango, Tropical and Citrico. PepsiCo and Kenneth Cooper, M.D., M.P.H., of Cooper Concepts Inc. (CCI), a division of the renowned Cooper Aerobics Center in Dallas, TX enter into an agreement to promote nutrition, fitness and wellness. Dole Beverages enters chilled orange juice business as it launches five new flavors and packages.

• •

Aquafina debuts new line of great-tasting enhanced waters. Aquafina Essentials target active, health-conscious adults in four lightly sweetened varieties including B-Power, Calcium+, Daily C and Multi-V in 20-oz. bottles.

PepsiCo reorganizes to unite all North American beverage operations, including Pepsi-Cola, Tropicana and Gatorade, into one new division -- PepsiCo Beverages and Foods North America.

• •

PepsiCo announces $5 billion share repurchase program. Starbucks unveils white vanilla and coconut crème Frappuccino.

Tropicana has new ad campaign for Tropicana Pure Premium Healthy Kids - TV spots designed to capture the essence of children's needs. Galaxy Nutritional Foods launches Ultra Smoothies made with Tropicana juices. PepsiCo publishes Health and Wellness Philosophy. (on pepsico.com) Frito-Lay announces it is eliminating trans fats from Doritos, Tostitos, and Cheetos. Frito-Lay announces plans to introduce Lay's Reduced Fat chips and Cheetos Reduced Fat snacks. Quaker's Nutrition for Women team has developed a Food Guide Pyramid for Women as well as an online nutritional assessment. Brand Pepsi has a new look. Beyonce Knowles has joined the Pepsi family and will collaborate with Pepsi two new TV commercials, radio, and Internet ads. PepsiCo introduces Marathon Kids, a program that encourages kids and their families to be more physically active. The program debuts in Dallas, TX. Tropicana introduces a new campaign with the tag line "So pure. So alive. Tropicana Pure Premium."

• • • •

• •

2003 Milestones
• • • • • • •

Pepsi-Cola launches Sierra Mist nationally. PepsiCo launches "Get Active/Stay Active" program. Quaker Chewy introduces Quaker Chewy Wholesome Favorites and Quaker Chewy Trail Mix. Gatorade unveils In-Car Hydration System for NASCAR Drivers. SoBe sponsors U.S. Open Snowboarding Championships. Pepsi announces plans to launch Mt. Dew LiveWire, an orange drink, this summer. Pepsi-Cola signs an exclusive four-year sponsorship deal with the Canadian Hockey Association, making Pepsi the official soft drink. Pepsi announces four-year sponsorship agreement with the UK Football Association. Frito-Lay announces new line of snacks made with organic ingredients called "Natural Snacks." "Pepsi Stuff" Campaign kicks-off in Canada. Frito-Lay finds winner of "Would You Name Your Baby Horton" search celebrating the "rebirth" of its Ruffles brand. The child will receive $50,000 college tuition fund from Frito-Lay. PepsiCo creates PepsiCo International, the business that will unite all international snack, beverage and food units in an effort to drive faster growth and improved profitability around the world.

• •

• •

PepsiCo releases a Spanish-language "Power of One" television commercial starring Puerto Rican singer and actor, Ponce, and Velasquez, Mexican-American singer and actress. Pepsi–Cola trademark turns 100 years old. Quaker rolls out new Oatmeal Breakfast Squares. Pepsi Vanilla is launched in the United States. Tropicana introduces Tropicana 100% Juice Blends.

• • • •

2004 Milestones
• •

PepsiCo Launches 'HealthRoads' Wellness Benefit for Associates and Their Families PepsiCo's new "Smart Spot" program is featured as an example of the food industry's focus on health and wellness in today's edition of USA Today. Frito-Lay Launches Doritos and Cheetos Halloween Treat Multi-Sacks Frito-Lay's 24-count Multi-Sack variety pack won the Institute of Packaging Professional's (IoPP) Integrity Award, one of the industry's top awards, at this year's AmeriStar Packaging Awards.

• •

• • •

Frito-Lay Introduces Doritos Black Pepper Jack Diet Sierra Mist Becomes Sierra Mist Free Pepsi Bottling Group (PBG) – PepsiCo's biggest bottler bought Phil Gaudreault et Fils Ltee, a Quebec-based Pepsi bottler. SoBe Launches Sugar-Free No Fear PepsiCo Launches 'Smart Spot' Symbol in Canada Frito-Lay launches Doritos Edge and Tostitos Edge -- line extensions with 60% fewer carbohydrates. Gatorade introduces Gatorade Endurance Hydration Formula-- a specialized sports drink to meet the needs of endurance athletes. Frito-Lay introduces Quaker Chewy Cookies & Milk granola bars and Quaker Fruit & Oatmeal cereal bars. Frito-Lay Canada eliminates trans fats from chips and launches a line of All Natural and Organic products. Pepsi-Cola to launch Pepsi Edge, the first full-flavored cola with 50% less sugar, carbohydrates and calories than regular cola.

• • •

2005 Milestones
• • • •

Frito-Lay introduces Doritos Black Pepper Jack Diet Sierra Mist becomes Sierra Mist Free. PepsiCo launches "Smart Spot" symbol in Canada Tropicana Teams With Weight Watchers to Offer Tropicana Light 'n Healthy as Part of 'Points' Program Pepsi Lime and Diet Pepsi Lime Launch Tropicana Twister Soda Launched in April The Fuddruckers restaurant chain signed a 7-year, 5.6 million gallon agreement with PepsiCola North America to serve Pepsi products. Pepsi-Lipton Tea Partnership Announces New Lipton Original Iced Tea and New Lipton Iced Tea; Reformulated Ready-to-Drink Teas Hit Store Shelves Pepsi-Cola North America adds to its portfolio of Dole 100% juices – Ruby Red Grapefruit – as well as a new line of 50% juice beverages called Dole Lights. Pepsi-Cola North America announced it will add Splenda® brand sweetener to a newly reformulated Pepsi ONE, creating a full-flavor cola taste with only one calorie. Quaker snack bars re-launched with new branding, packaging and advertising PepsiCo Celebrates 40th Anniversary PepsiCo International announced the appointment of Pioneer Foods, a leading South African food and beverage company, as its franchisee in the Republic of South Africa. Tropicana has launched 'Tropicana Sensations', a new line of premium fruit juices in Spain PepsiCo launches Quaker Milk Chillers Gatorade Partners with NFL to Educate High School Football Coaches on Proper Hydration During Practice Quaker Introduces Weight Control Instant Oatmeal Diet Pepsi Presents the NFL Rookie Challenge -- Winner Receives Super bowl Tickets for Life Tropicana Launches All Fruit Smoothies Pepsi is chosen as the exclusive beverage provider for Soup Kitchen International, Inc. and The Original Soup Man PepsiCo Donates $2 Million to Pakistan Earthquake Victims

• • •

• • •

• • •

• • • •

• • • • • • • • •

PepsiCo Launches New Samba Drink in Australia Pepsi-Cola North America Launches MDX Energy Soda Pepsi Partners with Harvey's, Swiss Chalet and Milestone's Restaurants PepsiCo "Twistos" Croutons Launched in Russia Gatorade Launches Propel Calcium - First Calcium-Enriched Fitness Water Frito-Lay Launches Quaker Oats in India Walkers to Launch New Beef Jerky Product in the U.K. under its Nobby's brand PepsiCo Health & Wellness Launches Everyday Smart Moves Magazine PepsiCo, Cindy Crawford and KaBOOM Build First Smart Spot Playground in Washington, D.C. Pepsi Latte Launches in Thailand Tropicana Fruit Wise Campaign Launches Mountain Dew Sponsored ESPN X Games Debut in the Middle East PepsiCo Launches Pepsi Cappuccino in Romania Quaker Launches Vanilla Yogurt Crunch Cereal Britvic Launches Pepsi Max Cino

• • • • • •

2006 Milestones
• • • • • • •

Quaker Snacks Unveils Breakfast Cookies Doritos unveils new packaging, including an updated logo PepsiCo Launches Pepsi Limon in Peru PepsiCo Completes Acquisition of Stacy's Pita Chip Company Tropicana Now Offering OJ with Benecol PepsiCo Foodservice Partners With Cracker Barrel to Serve Up Fritos-Branded Menu Item PepsiCo Foodservice Pours Two New Account Wins: Famous Dave's of America and Roundtable Pizza Pepsi Celebrates 20th Consecutive Super Bowl With New Diet Pepsi Campaign North American Coffee Partnership Launches New Starbucks Beverages, Starbucks Iced Coffee, Starbucks Iced Coffee Light as well as Strawberries and Creme Frappuccino and Starbucks Doubleshot Light

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PepsiCo India re-launches Mirinda SoBe Launches New SoBe Life Water Cheetos kicks off the biggest marketing campaign in its history with "Undercover Chester," an integrated communications platform that asks consumers to help Chester Cheetah recover the stolen recipe for Cheetos

In selected cities cross the United States, Pepsi distributes more than three million free cans of newly reformulated Diet Mountain Dew, marking the largest single-day sampling effort in company history

Frito-Lay announces the launch of a new line of snack chips called Lay's Sensations and Tostitos Sensations Frito-Lay launches Tostitos Multigrain; new snack brings flavor of four wholesome grains to one of America's favorite tortilla chips Sam's Club teams with Aquafina to "Return the Warmth" to local communities through a national large-scale recycling program. The 50 communities to collect the most Aquafina bottles and deposit them at designated collection locations receive a $1,000 grant from Sam's Club in addition to an assortment of fleece jackets made from recycled plastic bottle material

Lay's Introduces Hot 'n Spicy KC Masterpiece BBQ Potato Chips

Grammy award winning artist Mariah Carey writes and records original ringtones for the Pepsi Cool Tones & Motorola Phones promotion. Rice-A-Roni introduces a new line of whole-grain side dishes Pepsi Joins Bipartisan Alliance, Adopts New School Policy to Promote Healthier Lifestyles for Elementary, Middle and High School Students Frito-Lay cuts saturated fat in Lay's, Ruffles by more than 50% with move to NuSun™ Sunflower Oil Pepsi unveils new Dole Sparklers and Sierra Mist Cranberry Splash PepsiCo announces that it will be the official, exclusive food and beverage partner of the highly anticipated Superman Returns film Starbucks and PepsiCo sign a distribution agreement for Ethos Water PepsiCo, the National Hockey League (NHL) and the National Hockey League Players' Association (NHLPA ) sign an exclusive multi-year beverage and snack deal PepsiCo, National Hockey League and National Hockey League Players Association sign multi-year deal, giving PepsiCo exclusive rights in the beverage, sports beverage, bottled water and snack categories. With this deal, Gatorade becomes the official sports drink of NHL

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PepsiCo Mexico celebrates the official launch of the 'Vive Saludable' program illustrating their commitment to promote healthy lifestyles for consumers and employees and together help reduce the risk of nutrition-related health problems, including obesity

Diet Pepsi launches Jazz, a new line of zero-calorie colas available in rich flavors like Black Cherry French Vanilla and Strawberries & Cream PepsiCo introduces Ben & Jerry's Milkshakes, a rich, creamy drinkable treat in three classic flavors--Cherry Garcia, Chunky Monkey and Chocolate Fudge Brownie Tropicana debuts Tropicana Pure--a new line of 100% premium juices PepsiCo is added to the Dow Jones Sustainability North America Index (DJSI) Quaker Oats debuts its new Quaker Oatmeal Crunch, warm oatmeal with the crunchy texture of cold cereal Indra Nooyi named Chief Executive Officer of PepsiCo as of October 1, 2006 Frito-Lay debuts action cups Frito-Lay kicks of its nationwide rollout of Lay's with 100% Pure Sunflower Oil Pepsi acquires IZZE beverage company

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Arby's names Pepsi-Cola as its Food and Beverage Supplier Award winner Golden Corral restaurants and Pepsi announce a multi-year agreement making Pepsi the chain's preferred beverage supplier in all locations Grandma's Cookies releases 2 limited-edition 'fall favorites' flavors—Spiced Molasses and Fall Fudge Chip Cold Stone Creamery announces a multi-year agreement making Pepsi its exclusive beverage supplier Frito-Lay North America signed agreement with the Alliance for a Healthier Generation for a new policy for selling our foods in schools Frito-Lay launches new Baked!Tostitos Scoops! Tortilla chips, with lower calorie and lower fat benefits Pepsi signs 5-year sponsorship renewal with Major League Baseball Properties making Pepsi the "Official Soft Drink of Major League Baseball" PBSG Parkwood and Frito-Lay headquarters associates raise more than $1.8 million dollars in the American Heart Association Walk PepsiCo announced intent to acquire Naked Juice Company Federal Trade Commission clears PepsiCo for Naked Juice Co. purchase PepsiCo announces it will acquire New Zealand snack company Bluebird Foods

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2007 Milestones

PepsiCo signs Maria Sharapova for International endorsement of Gatorade and Tropicana Tropicana launches Tropicana Healthy Heart with Omega-3s, the first national orange juice to include omega-3s Ruffles unveils new packaging to reflect its switch to 100% pure sunflower oil PepsiCo announces new Diversity & Inclusion Leadership Award inspired by Steve Reinemund Mountain Dew and AMP Energy sponsor the Winter X Games Aquafina launches Aquafina Alive—a low calorie, vitamin-enhanced water beverage Quaker Oats debuts new Quaker Life Chocolate Oat Crunch Cereal Flat Earth Fruit and Vegetable Crisps hit stores nationally Fritos Corn Chips celebrates 75th Anniversary with retro packaging Near East celebrates its 45th Anniversary with a recipe contest Tropicana launches Tropicana Fruit Squeeze, a 20-calorie drink with real Tropicana fruit juice Lay's launches 'Share the Joy' program to help the Make a Wish Foundation raise funds Pepsi-Cola North America launches Diet Pepsi MAX Oh Boy! Oberto brand debuts 100-calorie Jerky Bites in Original Beef and Teriyaki Turkey flavors IZZE Launches IZZE Esque, a low-calorie, nothing artificial beverage in three flavors: Sparkling Mandarin, Sparkling Black Raspberry and Sparkling Limon. Propel unveils new 'Fit Has a Feeling' campaign and New Powder Packets for On-The-Go New Quaker Mini Delights launches offering great taste and portion control in a satisfying serving of mini snack cakes Diet Pepsi Jazz introduces new Caramel Cream flavor Grandma's Cookies offering limited-edition flavors for spring: Iced Lemon and Sugar flavors PepsiCo launches Smart Spot Dance! Initiative with celebrities Mario Lopez and LaChanze to help African American and Hispanic families lead healthier, more active lifestyles Walkers is the first major food brand in the world to display a carbon footprint reduction logo on its packs

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SoBe Beverages launches SoBe Essential Energy PepsiCo Announces 25% Dividend Increase and Raises Share Repurchase Target; Nooyi Assumes Chairman Title EPA Names PepsiCo 2007 ENERGY STAR(R) Partner of the Year PepsiCo Makes Largest Corporate Purchase of Renewable Energy Certificates Pepsi launches "Design Our Pepsi Can" National Promotion Tropicana unveils New Organic Line – Tropicana Organic Indra Nooyi receives the Outstanding American by Choice Award PepsiCo makes Fortune magazine's '100 Best MBA Employers' list Diet Pepsi Launches New Look, New Ad Campaign and New Attitude – Diet Pepsi's "More Cola Taste" Pepsi, Diet Pepsi and Mountain Dew topped the 2007 Brand Keys Customer Loyalty Engagement Index which tracks consumers' relationships with brands PepsiCo joins U.S. Climate Action Partnership as part of its commitment to sustainability Lipton introduces Lipton PureLeaf EPA Honors Frito-Lay's Jonesboro facility for its sustainability efforts to conserve energy and resources Cold Stone Creamery and Mountain Dew Join Forces to Introduce Dew Iced Mountain Dew Unveils unique, limited edition aluminum bottles Tostitos introduce Flour Tortilla Chips and two new Dairy Dips Nationwide PepsiCo named a 2007 Working Mother 'Best Company for Multicultural Women' PepsiCo wins two awards –Best Environmental/Wildlife Campaign and Best Cause Marketing Event -- at Fifth Annual Cause Marketing Halo Awards Frito-Lay teams up with the Make-A-Wish Foundation to help children with life-threatening diseases Dunkin' Donuts launches SoBe Energy Coolatta Pepsi wins Webby Award for its execution of the "Best Sports Website" PepsiCo and Pepsi Americas, Inc jointly acquire Sandora, a Leading Juice Company in Ukraine PepsiCo earns spot in Black Enterprise Magazine's '40 Best Companies for Diversity' Lay's and Doritos Campaigns win Top PR Awards

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2008 Milestones

PepsiCo Foundation announces two major new grants to WaterPartners and Safe Water Network programs to provide access to safe water and sanitation in developing countries PepsiCo Again Named to the Dow Jones Sustainability Index PepsiCo Agrees to Buy Bulgaria's Leading Nuts and Seeds Company PepsiCo Announces Initiatives With the Earth Institute and H2O Africa to Drive Sustainable Water Practices Forbes Names PepsiCo Among Its Best Big Companies PepsiCo India Commissions First Remote Wind Turbine to Generate Renewable, Clean Energy CRO Names PepsiCo to Top 25 100 Best Corporate Citizens 2008 PepsiCo to Buy Russian Juice Leader, Lebedyansky Employees Lead Effort to Make Chicago Plaza First LEED-Certified PepsiCo Headquarters Gatorade Launches Gatorade Tiger with Comprehensive Integrated Marketing Campaign PepsiCo Honored with 2008 Energy Star Partner of the Year Award UK Vitamin Water Brand- V Water Acquired by PepsiCo Quaker Plant in Cedar Rapids Closes and Reopens Facility Due to Flooding to Protect Employees PepsiCo Foodservice and Naked Juice Expand Starbucks Presence Gatorade Sports Science Institute Gathers World's Leading Researchers on Protein Nutrition PepsiCo International's China Foods Wins "China's Top Leaders 2008" Award Wall Street Journal Article Recognizes PepsiCo for Leadership in Employment of People with Different Abilities PepsiCo and Frito-Lay Join SmartWay in Commitment to Reduce Greenhouse Gas Emissions PepsiCo Beats Coke in Race to Launch New Natural Sweetener (Stevia) PepsiCo France Recognized as "Great Place To Work" by Institute Survey PepsiCo Commits to Reducing Acryalmide Levels in Potato Chip Products and Restructured Potato Snacks in California Subway Names PepsiCo "Vendor of the Year" for Sustainability Leadership Tazo Tea Joins Pepsi Lipton Partnership

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Indra K. Nooyi{Chairman and CEO}
Biography
Indra Nooyi is Chairman and Chief Executive Officer of PepsiCo. Mrs. Nooyi leads one of the world’s largest convenient food and beverage companies, with 2008 annual revenues of more than $43 billion. The company’s products are sold in approximately 200 countries, and it employs more than 198,000 people worldwide. Its principal businesses include Frito-Lay snacks, Pepsi-Cola beverages, Gatorade sports drinks, Tropicana juices and Quaker foods. In total, the PepsiCo portfolio includes 18 brands that generate $1 billion or more each in annual retail sales. Mrs. Nooyi is the chief architect of PepsiCo’s multi-year growth strategy, Performance with Purpose, which is focused on generating robust financial returns from designing products for and finding sustainable ways to give back to communities the company serves. Performance with Purpose is premised on offering food and beverages that provide responsible nourishment, minimizing impact on the environment and creating a diverse and inclusive culture that attracts, develops and retains the most talented people. In keeping with this growth strategy, PepsiCo is proud to be listed on the Dow Jones North America Sustainability Index and Dow Jones World Sustainability Index. Mrs. Nooyi was named President and CEO on October 1, 2006 and assumed the role of Chairman on May 2, 2007. She has directed the company's global strategy for more than a decade and led PepsiCo's restructuring, including the divestiture of its restaurants into the successful YUM! Brands, Inc.; the spin-off and public offering of company-owned bottling operations into anchor bottler Pepsi Bottling Group (PBG); the acquisition of Tropicana and the merger with Quaker Oats that brought the vital Quaker and Gatorade businesses to PepsiCo. Prior to becoming CEO, Mrs. Nooyi served as President and Chief Financial Officer beginning in 2001, when she was also named to PepsiCo's board of directors. In this position, she was responsible for PepsiCo’s corporate functions, including finance, strategy, business process optimization, corporate platforms and innovation, procurement, investor relations and information technology.

Between February 2000 and April 2001, Mrs. Nooyi was Senior Vice President and Chief Financial Officer of PepsiCo. Between 1996 and 1999, Mrs. Nooyi was Senior Vice President of Corporate Strategy and Development. Before joining PepsiCo in 1994, Mrs. Nooyi spent four years as Senior Vice President of Strategy and Strategic Marketing for Asea Brown Boveri, a Zurich-based industrials company. She was part of the top management team responsible for the company's U.S. business as well as its worldwide industrial businesses, representing about $10 billion of ABB's $30 billion in global sales. Between 1986 and 1990, Mrs. Nooyi worked for Motorola, where she was Vice President and Director of Corporate Strategy and Planning, having joined the company as the business development executive for its automotive and industrial electronic group. Prior to Motorola, she spent six years directing international corporate strategy projects at the Boston Consulting Group. Her clients ranged from textiles and consumer goods companies to retailers and specialty chemicals producers. Mrs. Nooyi began her career in India, where she held product manager positions at Johnson & Johnson and at Mettur Beardsell, Ltd., a textile firm. In addition to being a member of the PepsiCo board of directors, Mrs. Nooyi serves as a member of the boards of the International Rescue Committee, Catalyst and Lincoln Center for the Performing Arts. She is a Successor Fellow of Yale Corporation and member of the Board of Trustees of Eisenhower Fellowships, and she currently serves as Chairman of the U.S.-India Business Council. She holds a BS from Madras Christian College, an MBA from the Indian Institute of Management in Calcutta and a Master of Public and Private.

Worldwide code of conduct of PepsiCo
Dear Fellow Associates: PepsiCo has consistently led the industry without standing financial performance – and we can rightfully take pride in our accomplishments. Like all winning teams, we are constantly asking ourselves, “How do the best get even better?” The answer is to deliver Performance with Purpose: our vision to take PepsiCo’s foundation of strength and build on it to create a company that both generates healthy financial returns and improves the lives of our consumers, our employees and our communities. To do better by doing better, we must start with our Values and our Code of Conduct. This means delivering superior financial performance the right way, achieving results with integrity, building trust with one another and all of our stakeholders – with our Values and our Code at the center of everything we do. Our commitment to applying our Values and the Code of Conduct to all aspects of our business is critical to delivering world-class performance … and doing so with a larger purpose that makes a difference to the world we share. My intent is that this Code of Conduct will help guide each of us as we work toward living our Values and making Performance with Purpose a reality. These indispensable tools serve as our unshakeable foundation. Thank you for your support and your personal engagement in ensuring that PepsiCo remains a highintegrity company that delivers consistently strong performance the right way.

Indra Nooyi
[Chairman and Chief Executive Officer]

INTRODUCTION:
PepsiCo’s mission is to be the world's premier consumer Products Company focused on convenient foods and beverages. We seek to produce healthy 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. In everything we do, we strive to act with honesty, fairness and integrity and to obey the laws and regulations of the countries where we do business. This Code of Conduct applies to PepsiCo, its subsidiaries throughout the world, joint ventures over which PepsiCo has management control and to every employee of these companies.

RESPECT FOR OUR EMPLOYEES
We believe our most important strength is our employees. We seek to provide a work environment where all employees have the opportunity to reach their full potential and contribute to PepsiCo's success. We emphasize personal integrity and believe long-term results are the best measure of an employee’s performance. PepsiCo respects the human rights and the dignity of all employees. We endeavor to treat our employees fairly and honestly. We strive to maintain a safe, secure and healthy workplace and it is against our policy to use forced or child labor. We also strive to follow all applicable employment laws and regulations. We are committed to equal opportunity in all aspects of employment for employees and applicants. This means providing a workplace free from any form of discrimination or harassment, including sexual harassment. We seek to create a work environment where people feel comfortable and respected, regardless of individual differences, talents or personal characteristics. Our objective is for the diversity of our employees to reflect the diversity of the population wherever we operate and for the performance of all employees to be judged fairly and based on their contribution to our results. PepsiCo encourages an inclusive culture, which enables all employees to do their best. This means we: • • • Welcome and embrace the strengths of our differences, Treat each other with respect and fairness, and Foster an atmosphere of trust, open communications and candor.

We recognize the needs of individuals to achieve professional and personal balance in their lives. We also respect employee privacy and will acquire and retain only that employee personal information that is required for operation of the Company’s business or required by law.

CONSUMERS, CUSTOMERS, SUPPLIERS AND COMPETITORS
We are committed to the continuation of free enterprise and the legal and regulatory frameworks that support it. Therefore, we recognize the importance of laws that prohibit restraints of trade, predatory economic activities and unfair, deceptive or unethical business practices. In all of our business dealings with consumers, customers, suppliers and competitors, we will: • Avoid any unfair or deceptive practice and always present our services and products in an honest and forthright manner. • • • • • Treat all customers and suppliers honestly, fairly and objectively Select suppliers based on merit, and make clear to all suppliers that we compete fairly and vigorously for our business. Compete vigorously and with integrity. Never comment on a competitor’s product without a good basis for such statements. Comply with all competition laws, including those prohibiting agreements or understandings with competitors to fix prices or other sales terms, coordinate bids or divide sales territories, customers or product lines. These types of agreements with competitors are generally illegal in the United States and many other markets where we conduct business. expect them to

GLOBAL RELATIONS
PepsiCo firmly believes that international commerce strengthens stability and peace by fostering economic growth, opportunity and mutual understanding. As a global enterprise, we recognize our responsibility to act in concert with the legitimate interests of the countries in which we do business. We will obey all applicable laws and regulations of our host countries. Our objective is to be a good corporate citizen wherever we operate.

BUSINESS GIFTS AND ENTERTAINMENT
Our business decisions are made on merit. Therefore, we will never give or offer, directly or indirectly, anything of value to a third party, including a government official, political party or candidate, to corruptly influence that person’s business decision or gain an unfair advantage. We will observe PepsiCo’s International Anti-Bribery Policy at all times. Giving gifts or entertainment to governmental officials is highly regulated and often prohibited. Such gifts and entertainment should not be provided unless you have received Law Department approval. Gifts or entertainment given to or received from customers or suppliers must never influence, or appear to influence, business decisions. There must be a legitimate business purpose for any business gift or entertainment, it must be in good taste and it must be consistent with the law, with the giver’s and receiver’s policies, PepsiCo’s policies and your function/division policies (including the Travel and Entertainment Policy). If business gifts are permitted under your function/division policies, they must be nominal in value and frequency. Customer and supplier meals and entertainment must be reasonable in cost and frequency and consistent with guidelines established by PepsiCo or your function/division.

HEALTH AND SAFETY
PepsiCo is committed to providing safe and healthy work environments at its facilities for all its employees, visitors, contractors and vendors. It is our policy to provide employees with a drug-free workplace. In order to create an environment free from threats, violence and intimidation, we are committed to a policy of zero tolerance for violence. We are dedicated to designing, constructing, maintaining and operating facilities that protect our people and physical resources. It is our policy to comply with all applicable health and safety laws and regulations, provide and require the use of adequate protective equipment and measures, and insist that all work be done in a safe and responsible manner. It is the responsibility of each employee to follow all Company policies and procedures related to workplace health and safety.

ENVIRONMENT
PepsiCo is committed to being an environmentally responsible corporate citizen. We are committed to minimizing the impact of our businesses on the environment with methods that are socially responsible, scientifically based and economically sound. We encourage conservation; recycling and energy use programs that promote clean air and water reduce landfill wastes and replenish the planet’s natural resources. We will follow applicable environmental laws and regulations in the countries where we operate.

POLITICAL AND COMMUNITY ACTIVITIES AND CONTRIBUTIONS
PepsiCo believes in contributing to society and encourages employees to participate in community activities. We will continue to communicate information and opinions on issues of public concern that may affect PepsiCo. Decisions by our employees whether or not to contribute time, money or resources of their own to any political or community activity are entirely personal and voluntary. We will obey all laws in promoting the Company’s position to government authorities and in making political contributions. Contributions by the Company to political candidates may be prohibited or regulated. Any such contribution requires the approval of PepsiCo’s Vice President of Public Policy and Government Affairs.

CONFLICTS OF INTEREST
PepsiCo’s conflicts of interest policy is straightforward: Don’t compete with PepsiCo businesses, and never let your business dealings on behalf of any of our businesses be influenced, or appear to be influenced, by personal or family interests. All actual or apparent conflicts of interest between personal and professional relationships must be handled honestly and ethically. You must disclose any potential conflict of interest to your

Supervisor as soon as you become aware of it. Examples of conflicts that must be disclosed and resolved include: • • • • • Receiving any financial or personal benefit either yourself or through a family member from a company that does or seeks to do business with PepsiCo. Having more than a nominal equity interest in a competitor or in a company that does or seeks to do business with PepsiCo (for example, ownership of more than 1% of a supplier’s stock). Serving on the board of directors or providing consulting services to a company that does or seeks to do business with PepsiCo. Owning property (such as real estate or patent rights) that PepsiCo may be interested in acquiring or leasing. Having outside business interests that could affect your job performance because of the amount of time and attention diverted from your responsibilities to PepsiCo.

CONFIDENTIAL INFORMATION AND INSIDER TRADING
While engaged in PepsiCo business, you may receive or learn of confidential, competitively sensitive or proprietary information that has not been disclosed to the public. Confidential or proprietary information includes all nonpublic information that, if disclosed, might be of use to competitors or might be harmful to PepsiCo, our suppliers or our customers. You always have a duty to protect the confidential information of PepsiCo and our business partners. You may not disclose confidential information to anyone outside PepsiCo, even to members of your own family, unless there is a clear business need to do so, the party receiving the information has signed a confidentiality agreement committing to maintain the information’s confidentiality and you believe that the disclosure will not harm or embarrass PepsiCo or its business partners. PepsiCo obeys all laws with respect to the disclosure of material, non-public information. Information is considered material if a reasonable investor would consider it important to his or her decision to buy or sell PepsiCo stock. Examples of material information include: a significant upward or downward revision of earnings forecasts; a significant division restructuring; a major management change; a significant acquisition or divestiture; a significant upcoming product launch or product innovation. Employees should not trade in PepsiCo securities or the securities of another company involved with PepsiCo while they have material, nonpublic information about PepsiCo or that company. In addition, employees should not disclose

material, non-public information about PepsiCo or another company to anyone outside the Company, including family members.

ACCOUNTS AND RECORD-KEEPING
We will continue to observe the most stringent standards in the keeping of our financial records and accounts. Our books and records must reflect all components of transactions, as well as our own standard of insisting upon an honest and forthright presentation of the facts. We will ensure that the disclosures we make in reports and documents that we submit to the Securities and Exchange Commission and in other public communications are full, fair, accurate, timely and understandable. It is the responsibility of each employee to uphold these standards. Appropriate records must be kept of all transactions and retained in accordance with PepsiCo’s Records Management Policy and Records Retention Schedule. Employees are expected to cooperate fully with our internal and external auditors. Information must not be falsified or concealed under any circumstance, and an employee whose activities cause false financial reporting will be subject to disciplinary action, including termination.

PROTECTION AND PROPER USE OF COMPANY ASSETS
PepsiCo’s technological resources, including computers, voicemail, e-mail and Internet access, are nto be used for proper purposes in a manner consistent with the Code and all other Company policies, including those related to discrimination, harassment and intellectual property. As with all PepsiCo assets, these resources are to be used for business purposes. It is generally not PepsiCo’s intent to monitor Internet access or messages on the voicemail and email systems. However, the Company reserves the right to do so in appropriate circumstances, consistent with applicable laws and regulations. If you have access to PepsiCo information precautions necessary to prohibit unauthorized access to the system. You should safeguard your passwords or other means of entry. Employees must not reproduce software assets licensed to PepsiCo, use illegally obtained software or distribute the original software media or unauthorized copies of software which the Company does not own or license.

REPORTING POTENTIAL VIOLATIONS OF THE CODE OF CONDUCT
PepsiCo expects its employees, contractors, agents, customers and suppliers to promptly report any conduct or situation that she/he believes conflicts with this Code or violates a local, state or federal law to their immediate supervisor, Human Resources or through the PepsiCo Speak Up line at: 1-866-729-4888 (from the U.S., Canada, Puerto Rico and U.S. Virgin Islands) For a list of phone numbers for all other countries, go to: http://www.pepsico.com/PEP_Citizenship/CodeofConduct/SpeakUp/index.cfm Reports can be made anonymously, and the Speak Up line is available toll-free 24 hours a day. PepsiCo is committed to reviewing any report made in good faith in a prompt manner and taking remedial action when appropriate. Every affected employee is required to fully cooperate with any inquiry that results from any reported conduct or situation. PepsiCo is also committed to protecting the rights of those individuals who report these issues to PepsiCo. Any PepsiCo employee who is found to have engaged in retaliation against any employee who has exercised his/her rights under this Code or under applicable laws will be subject to appropriate remedial action. In addition, those individuals who violate applicable law may also be subject to civil and criminal penalties.

RESPONSIBILITY FOR COMPLIANCE
All employees are expected to display responsible and ethical behavior, to follow consistently both the meaning and intent of this Code and to act with integrity on a daily basis. Managers and leaders are expected to ensure that our business processes and practices reinforce the Code, to serve as positive role models by establishing and adhering to high ethical standards, and to create an ethical culture by encouraging and rewarding actions that are consistent with the Code. This Code cannot provide definitive answers to all questions. For that, we must rely on each person's judgment and integrity. You are encouraged to seek guidance when a situation may not be clear. Your supervisor, Human Resources manager or the PepsiCo Law Department will respond to questions and issues of

interpretation about this Code. Waivers of this Code will be reviewed by the General Auditor and General Counsel, and in certain circumstances by the Board of Directors, and if required, will be appropriately disclosed.