An Overview of Soft Drink Industry

The total soIt drink market in Rs 6000 Crores.

India`s per capital consumption oI soIt drinks has risen to 9.5 servings in 2004 as against 7.5
servings in 2000 Iollowed by 5.4 serving in 1997 Branded soIt drinks retail anywhere in India
between Rs 8 Rs 12 and are expensive When measured against Purchasing power .There are
around 4, 00,000 retailers oI soIt drink. A soIt drink is a non-alcoholic beverage. It is artiIicially
Ilavoured and contains no Iruit or pulp.
India with population oI more than 100 crores is potentially one oI the largest consumer markets
in the world aIter China. The consumer market can be deIined as the market Ior products and
services that are purchased by individuals as house holds goods Ior their personal consumption.
SoIt drink is a typical consumer product purchased by individuals to quench thirst and secondly
Ior reIreshment.
Searching Ior the point oI origin oI Indian soIt drinks we Iirst document on Gold Spot, which
was the Iirst brand soIt drink in India. It was introduced by PARLE during later part oI 40`s.
Cola giant, Coca-Cola was the Iirst Ioreign soIt drink to be introduced in India in 1965, Coca-
Cola make a very good beginning and dominated the whole scheme right Irom the word go. It
(Coca-Cola) Iaced no competition at that time.
The marketing people did not even receive to publicize Cola-Cola Ior it sold Iirst like probability
not-cakes. This extraordinary success oI soIt drinks, can be attributed to the Iollowing Iactors :-
Absence oI contemporary competitive brand.
Euphoric image built up in the Western countries proceeded the entry into Indian Market;
and
Indians are very Iound by nature oI Ioreign goods, services etc. due to prolonged Ioreign
rules.
Parle Exports (P) Ltd., later in 1970 introduced Limca, Lemony SoIt drinks. BeIore Limca
introduce, they had tentatively introduced Cola, Three oI Iour groups oI Indian companies who
had the required production capacity started their own brands oI Cola, Lemon, Orange, but Iailed
to achieve their goal on a national basis.
India always has love and hate relationship with MNC`s which gave a signiIicant opportunities
to soIt drink industries in India when Coca-Cola decided to windup its operations in 1977 rather
than bowing to the Indian government insisting on:-
ilution oI equity, as the government Ielt that lots oI Ioreign currency was being wasted.
ManuIacturing oI the top-secret concentrate in India.
isclose oI the chemical composition oI the essence.
This leIt a large vacuum in the popular soIt drink market, and a vista was opened to any
company with the requisite, technical, marketing and organizational skills.
The exit oI Coca-Cola Irom India in1977 accelerated the growth oI several Indian SoIt rink.
New soIt drink in the Iorm oI Tetra pack entered the market among Frooti, Jump-In and Tree-
Top were the prominent once. Till 1977 their equipped bottling plants and the distribution
network a longing to be oI no use. It took them one year to develop new Iormula to survive and
gradually came up with Campa Lemon, Orange and Cola that order.

However Parle, the pioneer in the soIt drinks, blazed its way to national prominence with their
product ' Thumps Up bearing the slogan 'Happy ays are here again.This particular slogan
helped to win over the loyalists or addicts to Coca-Cola, who was in the state oI 'Cola Shockor
Cola epression. Soon the Indian SoIt drink industry started at a phenomenal rate, and all Parle
Products Gold Spot, Limca and Thumps Up became the brand leader in their own segment.
1990 saw the coming oI the multinational company PEPSI entering the Indian market. 11 years
aIter the exit oI Coca Cola. It had name, Iame and edge oI being one oI the best in the game and
it also oIIered stiII competition to Parle and Coke. Pepsi Cola Company Iounded by CALEB
BRAHAM in 1890 at North Carolina in USA. Now it is ranked 86th (1998) in the world with
the asset oI around $25000 million, having its head quarter at ATLANTA. Pepsi Co. India`s
HQ is at Gurgaon. Presently is operating in 196 countries. In India it has 34 Bottling Plant oI
them 8 are COBO and 26 are FOBO. COCA COLA entered India in the year 1993 In
collaboration with PARLE INIA LT.
The product range oI COCA-COLA CONSISTS oI :

OLA ORANGE LIME LIME MANGO M.WATER &
SODA
COKE, FANTA LIMCA SPRITE, MAAZA KINLEY
THUMS
UP
SPRITE
ICE















INDUSTRY PROFILE
History of ocaola
In May, 1886, Coca Cola was invented by octor John Pemberton a pharmacist Irom Atlanta,
Georgia. John Pemberton concocted the Coca Cola Iormula in a three legged brass kettle in his
backyard. The name was a suggestion given by John Pemberton's book keeper Frank Robinson.

It was a prohibition law, enacted in Atlanta in 1886, that persuaded physician and chemist r.
John Stith Pemberton to rename and rewrite the Iormula Ior his popular nerve tonic, stimulant
and headache remedy, "Pemberton's French Wine Coca," sold at that time by most, iI not all, oI
the city's druggists.

So when the new Coca-Cola debuted later that year - still possessing "the valuable tonic and
nerve stimulant properties oI the coca plant and cola nuts," yet sweetened with sugar instead oI
wine - Pemberton advertised it not only as a "delicious, exhilarating, reIreshing and invigorating"
soda-Iountain beverage but also as the ideal "temperance drink." It is said coke was discovered
when eLuise, a 19th century American soda jerk accidentally hit the soda water spigot, adding
carbonated water to the syrup in the glass. The result was a "happy accident": the invention oI
Coca-Cola.

Though Pemberton died just two years later - Iive months, in Iact, aIter his March 24, 1888,
Iiling Ior incorporation oI the Iirst Coca-Cola Co. - the trademark he and his partners created
more than one hundred years ago can claim wider recognition today than that oI any other brand
in the world.

ohn Pemberton
And the Coca-Cola beverage, whose unit sales totaled a mere 3,200 servings in 1886 ("nine
drinks per day" based on the twenty-Iive gallons oI syrup sold to drugstores by Pemberton
Chemical Co.), is today called the world's most popular soIt drink--accounting Ior billions oI
servings at restaurants in 195 countries.

Such is the commercial legacy oI a onetime ConIederate lieutenant colonel who earned his
medical degree at the age oI nineteen, who served on the Iirst Georgia pharmacy licensing board,
who set up a top-rated laboratory Ior chemical analysis and manuIacturing, and who, in his
dozen-and-a-halI years in Atlanta, established eighteen business ventures - including one, the
Coca-Cola Co., which now can boast 1995 sales in excess oI $15 billion.

Although Pemberton may have envisioned a Iuture Ior his soIt-drink creation--enticing six
Atlanta businessmen to invest in the start-up Coca-Cola enterprise--Ior reasons that remain a
mystery he soon began selling his interest in the Iormula.




By the late 1890s, Coca-Cola was one oI America's most popular Iountain drinks. With another
Atlanta pharmacist, Asa Griggs Candler, at the helm, the Coca-Cola Company increased syrup
sales by over 4000 between 1890 and 1900.
Advertising, was an important Iactor in Pemberton and Candler's success and by the turn oI the
century, the drink was sold across the United States and Canada. Around the same time, the
company began selling syrup to independent bottling companies licensed to sell the drink. Even
today, the US soIt drink industry is organized on this principle.
Coca-Cola attorneys also were called to battle against competitors who called the product name
a misrepresentation iI, as argued, its principal ingredients were neither the coca leaI nor the kola
nut--a source oI caIIeine that made the early beverage useIul in healing headaches.
By 1928 bottled sales had eclipsed Iountain sales, thanks to the pioneering introduction oI a
carton now popularly called the six-pack. The Iollowing year the company introduced metal
open-top coolers. Then in 1933 at the Chicago World Fair automatic Iountain dispensers made
their debut. Having expanded the brand into Iourty-Iour countries by the outbreak oI World War
II, WoodruII, within IiIteen years oI the war's end, had managed to double that number. "Now
the saying is you have to be global," said Goizueta, Coca-Cola's current chairman and chieI
executive. "We were global when global wasn't cool."
Two decades later, when Coca-Cola's board elected Goizueta to the post oI chairman and chieI
executive, the company was embarked on a Iinancial mission--to become one oI the best-
perIorming corporations in America. Average annual Iountain-sales growth under Goizueta has
continued to surge. And despite consumer uproar over the company's attempted Coca-Cola
reIormulation in 1985, the introduction oI iet Coke in 1982 was hailed as the most successIul
product launch oI the past decade.


Asa Griggs Candler

Until the 1960s, both small town and big city dwellers enjoyed carbonated beverages at the local
soda Iountain or ice cream saloon. OIten housed in the drug store, the soda Iountain counter
served as a meeting place Ior people oI all ages. OIten combined with lunch counters, the soda
Iountain declined in popularity as commercial ice cream, bottled soIt drinks, and Iast Iood
restaurants came to the Iore.
On April 23, 1985, the trade secret "New Coke" Iormula was released. Today, products oI the
Coca Cola Company are consumed at the rate oI more than one billion drinks per day.
One oI the most Iamous examples oI a trade secret is the formula for ocaola. The Iormula,
also reIerred to by the code name "Merchandise 7X," is known to only a Iew people within the
company and kept in the vault oI a bank in Atlanta, Georgia. The individuals who know the
secret Iormula have signed non-disclosure agreements, and it is rumored that they are not
allowed to travel together. In the past, you could not buy Coca-Cola in India because Indian law
required that trade-secret inIormation be disclosed. In 1991, India changed its laws regarding
trademarks, and Coca-Cola can now be sold in that country.
Trade secrets are very diIIerent Irom patents, copyrights and trademarks. While patents and
copyrights require you to disclose your inIormation in the application process (inIormation that
eventually becomes public), trade secrets require you to actively keep the inIormation secret.
Trade-secret protection can potentially last longer than that oI patents (20 years) and copyrights
(100 years).
Some of the ways to protect a trade secret are as follows:
O Restrict access to the inIormation (lock it away in a secure place, such as a bank vault).
O Limit the number oI people who know the inIormation.
O Have the people who know the trade secret agree in writing not to disclose the inIormation
(sign non-disclosure agreements).
O Have anyone that comes in contact with the trade secret, directly or indirectly, sign non-
disclosure agreements.
O Mark any written material pertaining to the trade secret as proprietary.
WoodruII introduced the six bottle carton in 1923. He also made Coca-Cola available through
vending machine in 1929, that same year, the Coca- Cola bell glass was made available. He
started advertising on the radio in the 1930s and on the television in 1950. Currently Coca-Cola
is advertised on over Iive hundred TV channels around the world. In 1931, he introduced the
Coke Santa as a Christmas promotion and it caught on. Candler also introduced the twelve ounce
Coke can in 1960. The Coca-Cola contour bottle was patented in 1977. The two liter bottle was
introduced in 1978, the same year the company also introduced plastic bottles (Coca-Cola
multiple pages).
In 1985, the Coca-Cola Company made what has been known as one oI the biggest marketing
blunder. The Coca-Cola company stumbled onto the new Iormula in eIIorts to produce diet
Coke. They put Iorth 4 million dollars oI research to come up with the new Iormula.
This was the Iirst Ilavor change since the existence oI the Coca- Cola company. The change was
announced April 23, 1985 at the Vivian Beaumont Theater at the Lincoln Center. Some two
hundred TV and newspaper reporters attended this very glitzy announcement. It included a
question and answer session, a history oI Coca-Cola, and many other elements (Oliver 131).
The 1996 Summer Olympics will be held in Atlanta, Georgia, the home oI Coca-Cola. One great
earmark that the Coca-Cola company has is helping the people oI Atlanta. One way to see all oI
the achievements oI the Coca- Cola company is to visit the World oI Coke in Atlanta. It houses a
collection oI memorabilia, samples oI the products, exhibits, and many other exciting items
(Facts, Figures, and Features Multiple pages). All oI what has been said is the basis oI what
Coca-Cola was built on. Without societies help, Coca-Cola could not have become over a 50
billion dollar business. Keep on consuming the world's Iavorite soIt drink, Coca-Cola.







OA OLA IN INDIA

Introduction:-

AIter a 16-years absence, Coca-Cola returned to India in 1993. The
Company's presence in India was cemented in November that year in a deal that
gave Coca-Cola ownership oI the nation's top soIt-drink brands and bottling
network.

Coca-Cola India has made signiIicant investments to build and continually improve its business
in India, including new production Iacilities, wastewater treatment plants, distribution systems
and marketing equipment.
uring the past decade, the Coca-Cola system has invested more than US $ 1 billion in India.
Coca-Cola one oI the country's top international investors.
In 2003, Coca-Cola India pledged to invest a Iurther US$100 million in its operations.
Coca-Cola business system directly employs approximately 6,000 local people in India.
In India, we indirectly create employment Ior more than 125,000 people in related industries
through our vast procurement, supply and distribution system.
Virtually all the goods and services required to produce and market Coca-Cola locally are made
in India.
The Coca-Cola system in India comprises 25 wholly-owned company-owned bottling operations
and another 24 Iranchisee-owned bottling operations.is
A network oI 21 contract-packers also manuIactures a range oI products Ior the Company.
The complexity oI the Indian market is reIlected in the distribution Ileet, which includes 10-
tonne trucks, open-bay three-wheelers that can navigate the narrow alleyways oI Indian cities,
and trademarked tricycles and pushcarts.

ocaola in India Products & Quality

Our inley water brand was launched in 2000.
In 200, our energy drink Shock and our Iirst powdered concentrate, Sunfill, hit the market.
Annual per capita consumption oI soIt drinks in India is nine 8ounce servings.

In early 2003, ocaola India collected Advertiser of the Year and ampaign of the Year
awards for the Thanda Matlab ocaola allmedia campaign.

The Company ranking up "firsts" in the introduction oI anned and PET soft drinks, vending
machines and backpack dispensers for crowds of cricket supporters.

The Coca-Cola system adheres not only to national laws on food processing and labeling, but
also to our own strict standards Ior exceptional quality.

Lead indian brands Thums Up, Limca,
Maaza, itra and Gold Spot join the
Company's international Iamily oI brands
including ocaola, Diet oke, Sprite and
The Coca-Cola Quality System, to ensure that we are oIIering consumers only the highest
quality products.




















SWOT ANALYSIS
Strengths
Acquired Thumps up with a big market share
Improved quality control
Latest and advanced technology
ModiIied and attractive packing
Strong Brand Name

Weakness
Tight cash policy
Less concentration on local advertising
Lack oI sales promotional schemes
Less number oI empties than Pepsi
All package size is not available in the market

Opportunities
Good rural market
irect distribution
Per capita consumption in India is still low.The growth opportunity is
phenomenal

Threats
Intense competition with Pepsi
Pepsi is having already very good position in the mind oI consumer hence it
is very tough to get more market share.
Pepsi have provided sales generating assets to a large no. oI retailers due to
that they are selling only Pepsi products.
ue to the problems oI supply people oI rural areas Iail to get their
demanded quantity at the time oI marriage or their special occasions