“Project report on Competitive analysis of Coca Cola sales and

distribution practices compared to Pepsi”

Project Report Submitted in Partial Fulfilment of The Requirements

Of The Degree Of
Master of Business Administration

Under the supervision of

Dr. Ansuman Jena

Subject Name: - Sales and Distribution Management

Subject Code: - CUMM2361
Submitted By
Jawed khan (210402100003)

CENTURION UNIVERSITY OF TECHNOLOGY & MANAGEMENT

Dist. Khordha, Bhubaneswar, Odisha, Pin-752050
Introduction of Coca-Cola:-
Coca-Cola, or Coke, is a carbonated soft drink manufactured by the Coca-Cola
Company. In 2013, Coke products were sold in over 200 countries worldwide,
with consumers drinking more than 1.8 billion company beverage servings each
day. Coca-Cola ranked No. 87 in the 2018 Fortune 500 list of the largest United
States corporations by total revenue. Based on Interbrand's "best global brand"
study of 2020, Coca-Cola was the world's sixth most valuable brand.

Originally marketed as a temperance drink and intended as a patent medicine, it

was invented in the late 19th century by John Stith Pemberton in Atlanta,
Georgia. In 1888, Pemberton sold Coca-Cola's ownership rights to Asa Griggs
Candler, a businessman, whose marketing tactics led Coca-Cola to its
dominance of the global soft-drink market throughout the 20th and 21st century.
The drink's name refers to two of its original ingredients: coca leaves and kola
nuts (a source of caffeine). The current formula of Coca-Cola remains a closely
guarded trade secret; however, a variety of reported recipes and experimental
recreations have been published. The secrecy around the formula has been used
by Coca-Cola in its marketing as only a handful of anonymous employees know
the formula. The drink has inspired imitators and created a whole classification
of soft drink: colas.

The Coca-Cola Company produces concentrate, which is then sold to licensed

Coca-Cola bottlers throughout the world. The bottlers, who hold exclusive
territory contracts with the company, produce the finished product in cans and
bottles from the concentrate, in combination with filtered water and sweeteners.
A typical 12-US-fluid-ounce (350 ml) can contains 38 grams (1.3 oz) of sugar
(usually in the form of high-fructose corn syrup in North America). The bottlers
then sell, distribute, and merchandise Coca-Cola to retail stores, restaurants, and
vending machines throughout the world. The Coca-Cola Company also sells
concentrate for soda fountains of major restaurants and foodservice distributors.

The Coca-Cola Company has on occasion introduced other cola drinks under
the Coke name. The most common of these is Diet Coke, along with others
including Caffeine-Free Coca-Cola, Diet Coke Caffeine-Free, Coca-Cola Zero
Sugar, Coca-Cola Cherry, Coca-Cola Vanilla, and special versions with lemon,
lime, and coffee. Coca-Cola was called Coca-Cola Classic from July 1985 to
2009, to distinguish it from "New Coke".

Introduction of Pepsi:-
PepsiCo, Inc. is an American multinational food, snack, and beverage
corporation headquartered in Harrison, New York, in the hamlet of Purchase.
PepsiCo's business encompasses all aspects of the food and beverage market. It
oversees the manufacturing, distribution, and marketing of its products. PepsiCo
was formed in 1965 with the merger of the Pepsi-Cola Company and Frito-Lay,
Inc. PepsiCo has since expanded from its namesake product Pepsi Cola to an
immensely diversified range of food and beverage brands. The largest and most
recent acquisition was Pioneer Foods in 2020 for US$1.7 billion and prior to it
was buying the Quaker Oats Company in 2001, which added the Gatorade
brand to the Pepsi portfolio and Tropicana Products in 1998.

As of January 2021, the company possesses 23 brands that have over US$1
billion in sales annually. PepsiCo has operations all around the world and its
products were distributed across more than 200 countries, resulting in annual
net revenues of over US$70 billion. PepsiCo is the second-largest food and
beverage business in the world based on net revenue, profit, and market
capitalization, behind Nestlé. PepsiCo's flagship product, Pepsi Cola has been
engaged in a rivalry for generations with Coca-Cola; it is commonly referred to
as the cola wars. Although Coca-Cola outsells Pepsi Cola in the United States,
PepsiCo within the North American market is the largest food and beverage
company by net revenue. Ramon Laguarta has been the chief executive of
PepsiCo since 2018. The company's beverage distribution and bottling are
conducted by PepsiCo as well as by licensed bottlers in certain regions.

Pepsi has been repeatedly criticized by environmentalists for its relationship to

negative environmental impacts of agriculture in its supply chain, and
distributing operations such as palm oil-related deforestation and pesticide use,
its use of water resources, and the negative impacts of its packaging—Pepsi's
packaging has consistently been one of the top sources of plastic pollution
globally. Similarly, public health advocates have criticized Pepsi's high-calorie,
poor-nutrition product lines along with other popular snack and drink
manufacturers. In response, PepsiCo has made public comments on its
commitment to minimizing its impact but has not released public information
documenting progress on most of its public commitments.

Coca-Cola and PepsiCo are two of the largest beverage companies in the world,
with a market capitalization of $232 billion and $218 billion, respectively. Both
companies have a long history of competing against each other in the soft drink
industry. They have been using innovative sales and distribution practices to
maximize their market share and profitability. This paper aims to provide a
comprehensive comparative analysis of Coca-Cola and PepsiCo's sales and
distribution practices, with a focus on their competitive strategies, channel
strategies, supply chain management, etc.

Competitive Strategies:

Coca-Cola and PepsiCo have adopted different competitive strategies to gain a

competitive advantage in the soft drink industry. Coca-Cola focuses on brand
differentiation and marketing to maintain its market leadership position. The
company invests heavily in marketing and advertising to create a strong
emotional connection with its customers. Coca-Cola's iconic brand image and
the “Share a Coke” campaign are some examples of its effective marketing
strategies.

In contrast, PepsiCo focuses on product innovation and diversification to stay

ahead of its competitors. The company has a diverse portfolio of products,
including snacks, juices, and sports drinks. PepsiCo's Frito-Lay brand is a
market leader in the snack industry, and Gatorade is a dominant player in the
sports drink market. By diversifying its product portfolio, PepsiCo reduces its
reliance on the soft drink industry and expands its revenue streams.

Channel Strategies:

Coca-Cola and PepsiCo use different channel strategies to distribute their

products to customers. Coca-Cola primarily uses the franchised bottling system
to manufacture and distribute its products. The company has more than 250
bottling partners worldwide, which manufacture and distribute Coca-Cola's
products in their respective territories. Coca-Cola has a strong relationship with
its bottling partners, and the company provides them with support, training, and
technology to optimize their operations.

On the other hand, PepsiCo uses a direct store delivery (DSD) system to
distribute its products. The company delivers its products directly to retailers'
stores, bypassing third-party distributors. The DSD system allows PepsiCo to
have greater control over its products' distribution and provide faster and more
reliable service to retailers. PepsiCo's Frito-Lay division uses a hybrid
distribution system, where it uses both DSD and third-party distributors to
distribute its snack products.

Supply Chain Management:

Coca-Cola and PepsiCo have implemented different supply chain management

practices to improve their efficiency and reduce costs. Coca-Cola uses a lean
manufacturing process to minimize waste and improve its production efficiency.
The company has implemented a global supply chain management system that
enables it to manage its operations worldwide effectively. Coca-Cola has also
implemented a sustainability program that focuses on reducing its
environmental footprint and conserving natural resources.

In contrast, PepsiCo has implemented a total quality management (TQM)

system to improve its product quality and supply chain efficiency. The TQM
system involves continuous improvement, employee involvement, and customer
satisfaction. PepsiCo has also implemented a sustainability program that focuses
on reducing its carbon footprint, conserving water, and promoting recycling.

Sales Practices:

Coca-Cola's Sales Practices:

Coca-Cola is known for its aggressive marketing campaigns, which have helped
to establish the company as a global brand. The company sponsors major events
such as the Olympics and the World Cup, and has partnerships with celebrities
and influencers to promote its products. Coca-Cola's marketing efforts are
designed to create a sense of excitement and anticipation around its brand, and
to make consumers feel like they are part of something bigger.

In addition to marketing, Coca-Cola invests heavily in research and

development, seeking to innovate and improve its products. The company's
marketing campaigns often highlight new products or product variations, such
as Coke Zero or Cherry Coke. This helps to keep the brand fresh and relevant,
and to appeal to new generations of consumers.

Another strength of Coca-Cola's sales practices is its distribution network. The

company has a decentralized system, which means that it uses independent
bottlers to produce and distribute its products. This allows Coca-Cola to take
advantage of local market knowledge and to respond quickly to changes in
consumer preferences.

Pepsi's Sales Practices:

The company's sales practices involve a combination of marketing strategies,

distribution networks, and customer engagement initiatives.

One of Pepsi's most well-known sales practices is its focus on brand recognition
and advertising. The company spends significant amounts of money on
advertising campaigns and promotions to increase awareness of its products and
build brand loyalty among consumers. These campaigns often include celebrity
endorsements, sponsorships of major sporting events and concerts, and social
media marketing.

Pepsi also uses a variety of distribution channels to make its products available
to consumers. These channels include supermarkets, convenience stores,
vending machines, and online retailers. In many countries, Pepsi products are
also distributed through partnerships with local bottling companies.

In terms of customer engagement, Pepsi employs a range of tactics to attract and

retain customers. These tactics include loyalty programs, special offers, and
customer feedback programs. The company also actively engages with
consumers through social media and other digital platforms to gather feedback
and build relationships with its customers.

Overall, Pepsi's sales practices are focused on building brand awareness,

expanding distribution networks, and engaging with customers to drive sales
and build loyalty