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Coca-Cola Summer Internship Report
 

Coca-Cola Summer Internship Report

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The report is based on the STUDY OF OUTBOUND SUPPLY CHAIN AT COCA-COLA BEVERAGES. It discusses complete details of the supply chain management at coca-cola.

The report is based on the STUDY OF OUTBOUND SUPPLY CHAIN AT COCA-COLA BEVERAGES. It discusses complete details of the supply chain management at coca-cola.

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    Coca-Cola Summer Internship Report Coca-Cola Summer Internship Report Document Transcript

    • Spring Internship Report PROJECT REPORT ON Submitted By: Prashant Dubey PGDM – III Trimester SESSION 2012 - 2014 Shanti Business School, Ahmedabad
    • PRASHANT DUBEY – INSIGHT GEEKS PREFACE The PGDM curriculum is designed in such a way that student can grasp maximum knowledge and can get practical exposure to the corporate world in minimum possible time. Business schools of today realize the importance of practical knowledge over the theoretical base. The Spring Internship Program provides an opportunity to the students in understanding the industry with special emphasis on the development of skills in analyzing and interpreting practical problems through the application of management theories and techniques. It is a new platform of learning through practical experience, which incorporates survey and comparative analysis. It gives the student an opportunity to relate the theory with the practice, to test the validity and applicability of his/her classroom learning against real life business situations. 1
    • PRASHANT DUBEY – INSIGHT GEEKS ACKNOWLEDGEMENT I take this opportunity to express my profound gratitude and deep regards to my guide for his exemplary guidance, monitoring and constant encouragement throughout the course of this training. The help and guidance given by him time to time shall carry me a long way in the journey of life on which I am about to embark. Lastly, I am thankful to staff of HCCBPL for answering my each query regarding the process of the company. I am obliged to staff members of HCCBPL, Goblej for the valuable information provided by them in their respective fields. I am grateful for their cooperation during the period of my assignment. I am making this project not only for marks but to also increase my knowledge. THANKS AGAIN TO ALL WHO HELPED ME. 2
    • PRASHANT DUBEY – INSIGHT GEEKS TABLE OF CONTENT PREFACE ..................................................................................................................................................... 1 ACKNOWLEDGEMENT ............................................................................................................................ 2 TABLE OF CONTENT................................................................................................................................ 3 INTRODUCTION ........................................................................................................................................ 5 HISTORY OF THE COCA-COLA .............................................................................................................. 6 COCA-COLA SYSTEM IN INDIA ........................................................................................................... 10 COLA-COLA INDIA PVT. LTD........................................................................................................... 11 HINDUSTAN COCA-COLA BEVERAGES PVT. LTD. ..................................................................... 11 BOTTLING NETWORK OF COCA-COLA .....................................................................................12 THE PRESENT POSITION OF COCA-COLA INDIA............................................................................. 13 PACKAGES OF THE PRODUCTS....................................................................................................... 14 COMPETITORS OF COCA-COLA IN INDIA .........................................................................................15 LIST OF COMPETITORS AND THEIR PRODUCTS ......................................................................... 16 HCCBPL PLANT AT GOBLEJ .................................................................................................................17 DISTRIBUTION CHANNEL ....................................................................................................................18 SUPPLY CHAIN PROCESS......................................................................................................................20 OUTBOUND LOGISTICS PROCESS .................................................................................................. 20 PROCESS OF PRODUCTION  DC ................................................................................................21 BILLING PROCESS ..............................................................................................................................22 3
    • PRASHANT DUBEY – INSIGHT GEEKS FREIGHT CALCULATION ..................................................................................................................23 RTM (ROUTE TO MARKET)...................................................................................................................25 DISTRIBUTION PROCESS ..................................................................................................................25 BY CONTACTING DISTRIBUTOR................................................................................................. 26 BY CONTACTING DIRECTLY RETAILER ...................................................................................27 MILK ROUTE DISTRIBUTION ....................................................................................................... 27 FLEET MANAGEMENT.......................................................................................................................28 SWOT ANALYSIS .................................................................................................................................... 29 STRENGTHS: ........................................................................................................................................ 29 WEAKNESS:.......................................................................................................................................... 30 OPPORTUNITIES:................................................................................................................................. 31 THREATS: ............................................................................................................................................. 32 TARGET / TASKS ..................................................................................................................................... 33 ACHIEVEMENTS ..................................................................................................................................... 33 FINDINGS..................................................................................................................................................34 4
    • PRASHANT DUBEY – INSIGHT GEEKS INTRODUCTION  I Joined the Hindustan Coca-Cola Beverages Pvt. Ltd – Gujarat, as an Intern after successfully clearing the HR recruitment protocols (Group Discussion and Personal Interview) of the company.  Hindustan Coca-Cola Beverages is a fully owned subsidiary of The Coca-Cola Company.  Mr. T.Krishnakumar is the Chief Executive Officer of Hindustan Coca-Cola Beverages Pvt. Ltd.  For the very first two weeks I was placed in the corporate office of the company, where I learned about the corporate environment of the MNC’s established in India.  After the experience of two extraordinary weeks, my boss shifted me to the plant with an assignment so that I can get the experience of the life at plant of the Hindustan Coca-Cola Beverages.  The Coca-Cola plant of Gujarat is situated at the village Goblej in Ahmedabad – Kheda highway, 30 km. far from Ahmedabad city.  The plant is very beautifully spread over 52 acres of land, as it is the first Greenfield plant of India started in MARCH 1998.  The plant is completely owned by the company and giving employment to the local public.  The production process of this plant is totally untouched and the combination of the raw materials is done on the basis of the formula ‘7x’ which is pre-defined in the programs of the machines.  As this is the only one plant of Gujarat, its marketing area covers approximately whole Gujarat but in south Gujarat its territory is stopping Bharuch, the area after Bharuch comes into the territory of the Thane (Mumbai) plant. 5
    • PRASHANT DUBEY – INSIGHT GEEKS HISTORY OF THE COCA-COLA [MIRACLE BY DR. JOHN PEMBERTON] The first Coca-Cola recipe was invented in Columbus, Georgia, by John Stith Pemberton, originally in 1885 coca wine was called as a ‘Pemberton’s French wine coca’. As miracle was made by John Stith, it is assumed that he may have been inspired by the formidable success of European Angelo Mariana’s, coca wine. John Pemberton concentrated the Coca-Cola formula in a three legged brass kettle in his backyard. The name was a suggestion given by John Pemberton’s book keeper Frank Robinson. The first sales were at Jacob’s pharmacy in Atlanta, Georgia, on May 8 1886. It was initially sold as a patent medicine’s for five cents a glass at soda fountains, which were popular in the united states at the time due to the belief that carbonated water was good for the health. Pemberton claimed Coca-Cola cured many diseases, including morphine addiction, dyspepsia, neurasthenia, headache, and impotence. Pemberton ran the first advertisement for the beverage on May 29 of the same year in the Atlanta journal. For the first eight months only nine drinks were sold each day. Coca-Cola was sold in bottles for the first time on March 12 1894. Cans of coke first appeared in 1955. The first bottling of Coca-Cola occurred in Vicksburg, Mississippi, at the biedenharn candy company in 1891. Its proprietor was Joseph a biedenharn. The original bottles were biedenharn bottles, very different from the much later hobble-skirt design that is now so familiar. As a Candler was tentative about bottling the drink, but the two entrepreneurs who proposed the idea were so persuasive. However that Candler signed a contract proved to be problematic for the company for decades to come, legal matters were not helped by the decision of the bottlers to subcontract to other companies- in effect, becoming parent bottlers. 6
    • PRASHANT DUBEY – INSIGHT GEEKS  The Coca-Cola Company is a 120 years old company with its origin from Atlanta, Georgia. Coke was at first used as a refreshment drink.  The drink was discovered by Dr. John Pemberton on May 8, 1886. The soft drink was given the name Coca-Cola by Frank Robinson.  The Coca Cola Company was bought over and incorporated by Asa Griggs Candler, an entrepreneur.  The company was then patented in the year 1887 and final was registered in 1893.  Coke sells 1.7 billion drinks a day and it is the most recognized brand in the world.  Coca-Cola currently offers more than 500 brands in over 200 countries or territories.  The formula of manufacturing Coke lies in Downtown Atlanta on a piece of a paper.  The Coca-Cola Company was founded by Mr. Asa Griggs Candler after he bought the brand in 1889 and incorporated the company in 1892. Muhtar Kent is the current chairman & chief executive of the company.  The Coca-Cola Company is a beverage company which has several competitors throughout the world. But the leading competitors of the company globally are PepsiCo, Nestle and Dr. Pepper Snapple Group.  The people of Hong-Kong use Coca-Cola as a medicine for cough & cold, by serving it hot then its normal temperature. 7
    • PRASHANT DUBEY – INSIGHT GEEKS John Pemberton founded the formula of Coca-Cola when he concocted caramel-colored syrup in a three-legged brass kettle in his backyard. He first “distributed” the product by carrying it in a jug down the street to Jacob’s Pharmacy and customers bought the drink for five cents at the soda fountain. Dr. Pemberton’s partner and book-keeper, Frank M. Robinson, suggested the name and penned “Coca-Cola” in the unique flowing script that is famous worldwide even today. He suggested that “the two C’s would look well in advertising.” The first newspaper ad for Coca-Cola soon appeared in The Atlanta Journal, inviting thirsty citizens to try “the new and popular soda fountain drink.” By the year 1886, sales of Coca-Cola averaged nine drinks per day. The first year, Dr. Pemberton sold 25 gallons of syrup, shipped in bright red wooden kegs. Red has been a distinctive color associated with the soft drink ever since. Later on Dr. Pemberton never realized the potential of the beverage he created. So he gradually sold portions of his business to various partners and, just prior to his death in 1888, sold his remaining interest in Coca-Cola to Asa G. Candler, an entrepreneur from Atlanta. By the year 1891, Mr. Candler proceeded to buy additional rights and acquire complete ownership and control of the Coca-Cola business. Within four years, his merchandising flair had helped expand consumption of Coca-Cola to every state and territory. 8 1. 3.1% of all beverages consumed around the world are Coca-Cola products. 2. Coke makes so many different beverages that if you drank one per day; it would take you over 9 years to try them all. 3. The red and white Coca-Cola logo is recognized by 94% of the world's population. 4. Coca-Cola's $35.1 billion in revenue makes it the 84th largest economy in the world, just ahead of Costa Rica. 5. Coca-Cola spends more money on advertising than Microsoft and Apple combined. 6. The Coca-Cola brand is worth an estimated $74 billion: more than Budweiser, Pepsi, Starbucks and Red Bull combined. 7. If every drop of Coke ever produced were put in 8-ounce bottles and laid end-to-end, they would reach the moon and back over 2,000 times.
    • PRASHANT DUBEY – INSIGHT GEEKS Mr. Candler later on liquidated his pharmaceutical business and focused his full attention on the soft drink. With his brother, John S. Candler, John Pemberton’s former partner Frank Robinson and two other associates, Mr. Candler formed a Georgia corporation named the Coca-Cola Company. The trademark “Coca-Cola,” used in the marketplace since 1886, was registered in the United States Patent Office on January 31, 1893.The business continued to grow, and in 1894, the first syrup manufacturing plant outside Atlanta was opened in Dallas, Texas. Others were opened in Chicago, Illinois, and Los Angeles, California, the following year. In 1895, three years after The Coca-Cola Company’s incorporation, Mr. Candler announced in his annual report to shareowners that “Coca-Cola is now drunk in every state and territory in the United States.” As demand for Coca-Cola increased, the Company quickly outgrew its facilities. A new building erected in 1898 was the first headquarters building devoted exclusively to the production of syrup and the management of the business. In the year 1919, the CocaCola Company was sold to a group of investors for $25 million. Robert W. Woodruff became the President of the Company in the year 1923 and his more than sixty years of leadership took the business to unsurpassed heights of commercial success, making Coca-Cola one of the most recognized and valued brands around the world. 9
    • PRASHANT DUBEY – INSIGHT GEEKS COCA-COLA SYSTEM IN INDIA Coca-Cola was the leading soft drink brand in India until 1977, when it left the country rather than revealing its formula to the Government and reduces its equity stake as required under the Foreign Regulation Act (FERA) which governed the operations of foreign companies in India. The Coca-Cola Company re-entered India through its wholly owned subsidiary, CocaCola India Private Limited and re-launched Coca-Cola in 1993 after the opening up of the Indian economy to foreign investments in 1991. In India, the Coca-Cola system comprises of two different companies, a wholly owned subsidiary of The Coca-Cola Company namely Coca-Cola India Pvt Ltd which manufactures and sells concentrate and beverage bases and powdered beverage mixes, and a Company-owned bottling entity, named, Hindustan Coca-Cola Beverages Pvt Ltd. (As shown in the following hierarchy) The Cola-Cola Company in India Hindustan Coca-Cola Beverages Pvt Ltd. Coca-Cola India There are 13 authorized bottling partners of The Coca-Cola Company in India, who are authorized to prepare, package, sell and distribute beverages under certain specified trademarks of The Coca-Cola Company; and an extensive distribution system comprising of our customers, distributors and retailers. 10
    • PRASHANT DUBEY – INSIGHT GEEKS COLA-COLA INDIA PVT. LTD. Coca-Cola India Pvt. Ltd. is a Wholly-Owned Subsidiary of The Coca-Cola Company, USA. While building the consumer franchise for The Coca-Cola Company trademarks, it also leads world class governance systems for the operations of all partners in bottling, suppliers, distributors and other stakeholders. Functions:     Manufacture & sells concentrate to bottlers Brand Management Manages Franchisee Operations Corporate Reputation Management Coca-Cola India Private Limited sells concentrate and beverage only to authorized bottlers who are authorized to use these to produce our portfolio of beverages. These authorized bottlers independently develop local markets and distribute beverages to grocers, small retailers, supermarkets, restaurants and numerous other businesses. In turn, these customers make our beverages available to consumers across India. HINDUSTAN COCA-COLA BEVERAGES PVT. LTD. Hindustan Coca-Cola Beverages Pvt. Ltd. - As part of the Bottling Investments Group of The Coca-Cola Company, HCCBPL has 24 bottling plants at strategic locations in various states spread across India. The BIG cover approximately 65% of bottling operations for the Coca-Cola System in India. Functions:      Company owned bottler, member of the BIG Distributes & Executes the market Routines & Discipline the keywords of success Manufactures the Products Corporate Citizenship 11
    • PRASHANT DUBEY – INSIGHT GEEKS BOTTLING NETWORK OF COCA-COLA HCCBPL has an extensive distribution system spanning more than a million outlets operating with world class execution standards. The focus of the system is to develop strong customer value while delivering preferred choice of refreshment at an arm's length of desire to the consumer. In the network of the Coca-Cola system, Coca-Cola has either of the two bottling operation done for the company. 1. COBO – Company Owned Bottling Operations. The company’s owned bottling plants are the 100% subsidiary of HCCBPL, it holds all the rights to manufacture the products as well as to bottle the manufactured products. After 1993, when Coca-Cola re-entered the Indian market, it did a lot of changes in existing system of soft drink market prevailing in India, by acquiring the major brands and the bottling operations from Parle. Coca-Cola & PepsiCo launched in India at the same time so when Coca-Cola bought the leading beverages products of Parle, the Parle’s properties were took over by PepsiCo. After that the Coca-Cola Company founded some of its own bottling operation in India. In year 1997, company did a major investment of $700 million in India by purchasing other bottling operations, all around India and introduces new technology in them. These bottling plants are called Company Owned Bottling Operations. Company has full ownership and operational right for these types of operations. 2. FOBO – Franchise Owned Bottling Operations. Franchise Owned Bottling Operations are the other type of bottling operation for the company to these; the company has given the right to produce the product for the company and to supply with the territory assigned by the company. Company has no ownership or operational right / control over these. 12
    • PRASHANT DUBEY – INSIGHT GEEKS THE PRESENT POSITION OF COCA-COLA INDIA Coca-Cola entered in India in the year 1952 and was first launched in Agra in the year 1993, followed by pune in 1996 and Ahmedabad in 1998 in which Goblej was the first plant to be installed. Coca-Cola employs more than 1.75 lakh Indian people with 57 bottling plants throughout the country. Coca-Cola in India is divided into 3 regions namely northern, southern and central. They rank the 1st in the area of producing concentrated and non-concentrated and they rank 2nd in the producing mineral water (kinley) after Bisleri. They have market share of 55.4%. Coke rules the top No. 1.brand in the world’s top 100 brands. List of Coca-Cola products available in India: 1. Coca-Cola 2. Diet Coke 3. Thums Up 4. Sprite 5. Fanta Orange 6. Fanta Apple 7. Limca 8. Maaza 9. Minute Maid Pulpy Orange 10. Minute Maid Nimbu Fresh 11. Minute Maid Mango 12. Minute Maid Apple Drink 13. Minute Maid Mixed Fruit 14. Minute Maid 100% Apple Juice 15. Minute Maid 100% Grape Juice 16. Minute Maid 100% Orange Juice 17. Citra 18. Crush 19. Burn 20. Kinley Water 21. Kinley Soda 22. Schweppes Soda Water 23. Schweppes Tonic Water 24. GEORGIA Gold 25. Nestea 13
    • PRASHANT DUBEY – INSIGHT GEEKS PACKAGES OF THE PRODUCTS The Coca-Cola products are available to its customer in different sizes and packs depending on the beverage. Basically the company manufactures the product and bottles it in 5 different kinds of packs. 1. 2. 3. 4. 5. RGB – Returnable / Refillable Glass Bottles. PET – Plastic Bottles CAN – Aluminum Cans (Tins) Tetra – Tetra Packs BIB – Beverages in Bag RGB – These bottles are the glass bottles which are available in the size of 200ml & 300 ml. The consumer can buy these bottles from the retailer but once the beverage is consumed by the consumer the bottle is to be returned to the retailer and the amount paid to the retailer is only for the beverage. The retailer will later on return the bottle to the manufacturer and the bottle will be reused after certain cleaning procedures. PET – These are the plastic bottles made from Polyethylene terephthalate. The plastic bottles are much liked by the consumers as they don’t have to return the bottle to the retailer. The consumer can buy the bottles from the retailer and drink it at any preferred time. The PET bottles are available in the sizes of 400ml, 600ml, 750ml, 1ltr, 1.2ltr, 1.25 ltr, 2.25 ltr. CAN – These are the aluminum cans which can be easily seen in the market. The costs of these cans are higher than the normal PET and RG bottles. TETRA – These are the special packs used for the juices only. The CSD are not available in these packs. BIB – These are the bags which are not available to the consumers, these bags are used for the fountain machines at the mall, theaters, etc. It contains the beverages only without the CO2. The carbon dioxide is later added when it is being served to the customer in glass. 14
    • PRASHANT DUBEY – INSIGHT GEEKS COMPETITORS OF COCA-COLA IN INDIA The Coca-Cola India is the country’s leading soft drink manufacturer. But the company gets a tough competition through the other global leaders as well as the domestic companies. The leading Competitor of Coca-Cola in the country is PepsiCo. But beside PepsiCo the other competitors are Parle & Dr. Pepper Snapple Group which is establishing in India. Coca-Cola’s product Thumsup (India) gets a tough competition with the Pepsi. The Competition for Coca-Cola from PepsiCo is not so tough in the Indian market, as the thumsup is becoming the generic name for cola in India. The huge demand for thumsup in the Indian market is giving a tough competition to the Pepsi. The advertisement of the thumsup is liked by many of the youngsters and the claim of thumsup for a strong cola attracts the youngster towards it, as compared to Pepsi thumsup is a mild soft drink which is not as strong as thumsup. The Coca-Cola’s brand product Coca-Cola is not so much liked in the country and has a limited market, so the company has started focusing on the thumsup so that the companies market is maintained in the country. But the company is trying its best to popularize the CocaCola within Indian market. 15
    • PRASHANT DUBEY – INSIGHT GEEKS The soft drink market all over the world has been witnessing a neck to neck battle between the two major players, Coca-Cola and Pepsi since the very beginning. The thirst quenchers are trying hard to have the major chunk of the pie of carbonated soft drink market. Both the players are spending their energies in building capacity, infrastructure, promotional activities etc. Coca-Cola has been earning most of its bread and butter through beverage sales; Pepsi has a multi products portfolio with some portion from the same business. LIST OF COMPETITORS AND THEIR PRODUCTS Coca-Cola India Coca-Cola Diet Coke Thumsup Sprite Burn Limca MM 100% Juice Maaza Fanta Nestea MM Nimbu Fresh Kinley Kinley Soda Schweppes Tonic PepsiCo India Pepsi Diet Pepsi Dukes Cola Mountain Dew Gatorade 7up Tropicana Slice Mirinda Lipton Nimbooz Aquafina Leher Dukes Tonic Parle Agro Saint Juice Frooti LMN Bailey - 16 Dr. Pepper Snapple RC Cola -
    • PRASHANT DUBEY – INSIGHT GEEKS HCCBPL PLANT AT GOBLEJ The Goblej plant of Hindustan Coca-Cola Beverages Pvt Ltd is situated in kheda district of Gujarat. The plant is spread in a 52 acre land and it is the largest plant of the company in the country. It became the largest plant of the country in the year 2012 when it installed its 10th production line. By now here are total 11 production line and out of them 10 are active. The Second plant after goblej plant is the plant of Thane – WADA, Mumbai, Which has 8 production lines. In Goblej plant there are 11 bottling lines out of which 3 are RGB (Returnable Glass Bottle) lines, 5 are PET (Plastic Bottle) lines, 1 is Tetra Pack line another 1 BIB (Beverages in Bag) line which makes a total of 10 lines. The 11 th line is the JAR line for Kinley Water which is currently inactive. Beside 11 production lines the plant also has the 3 warehouses; out of which 1 is used to store juices and the other 2 are used to store rest of the products. The Goblej plant also takes care for the demand of in Rajasthan & Madhya Pradesh. These states also has HCCBPL plants, but due to the bad water facilities they are not able to fulfill the demand of the consumers in the state. 17
    • PRASHANT DUBEY – INSIGHT GEEKS DISTRIBUTION CHANNEL HCCBPL has a wide and well managed network of salesmen appointed for taking up the responsibility of distribution of products to diverse parts of the cities. The distribution channels are constructed in such a way that the demands of customers are fulfilled at the right place and the right time when it is needed by them. A typical distribution chain at HCCBPL would be: 18
    • PRASHANT DUBEY – INSIGHT GEEKS The customers of the company are divided into different categories and different routes, and every salesman is assigned to one particular route, which is to be followed by him on a daily basis. A detailed and well organized distribution system contributes to the efficiency of the salesmen. It also leads to low costs, higher sales and higher efficiency thereby leading to higher profits to the firm. The finished goods manufactured at the goblej plant are sent to 3 different locations: Distribution Center: The distribution center is the warehouse located at a distance of 2-2.5 KM away from the goblej plant. The products are distributed to the distributors from DC. Once the product is manufactured at the plant, it is dispatched to the DC after certain days whenever a demand is raised by the distributor. Inter-unit: These are the other COBO / FOBO plants located in the other states of the country. As Goblej plant is the country’s largest plant so it able to manufacture as much as quantity that it can also supply the FG to the other states. The water facility in other states like Rajasthan, Madhya Pradesh, etc. is not that good so to cover up the demand of the customers in that state the Coca-Cola transit products to the other states too. The Goblej plant earns a small margin of profit when it transits the products to other parts of the country. Intra-unit: These are the depots of the company; the depots are set up by the company so that the products are directly distributed to the retailer. So a depot located in Bangalore, Delhi, etc. can order for the products from the goblej plant when the demand in the state increases. 19
    • PRASHANT DUBEY – INSIGHT GEEKS SUPPLY CHAIN PROCESS The Supply chain management (SCM) is the management of a network of interconnected businesses involved in the provision of product and service packages required by the end customers in a supply chain. Supply chain management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption. There are 2 types of Supply chain management, INBOUND & OUTBOUND. Distribution means supply of goods from company to its ultimate user. After manufacturing the product the important work for the company is to provide its goods to its ultimate user at the right time. OUTBOUND LOGISTICS PROCESS Once the product is manufactured on the production line, it is picked up by the forklift and the forklift takes it to the warehouse where it is kept. So when the order for that product arises the product is dispatched in to the market. The outbound logistics process is carried over by the trucks, through trucks the products are taken out of the warehouse and distributed in different locations. 20
    • PRASHANT DUBEY – INSIGHT GEEKS PROCESS OF PRODUCTION  DC Following is the complete process starting from production till dispatching the products to distribution center: 1. First of all the production planning is given to the production department. 2. The products are manufactured according to the production planning. 3. At the time of production, the person from quality assurance department pickup up any 2-3 bottles of the product from the production line and take it for testing. 4. Once the product is manufactured, it is taken to the warehouse, but until the quality department approves the batch no. of the product the product is kept at the status of “Finished Good on Hold”. 5. After getting the approval from the QA department the FG is allowed to move out of the product. 6. When the FG is to be moved out to DC or inter-unit, the Sales Order is created for that FG. 7. The Forklifts bring the FG out of the warehouse and load the goods on the truck. 8. The checker verifies the upload, by taking care that the FG uploaded are as per the SO. 9. Once the FG is uploaded on the truck the checker fills the form of the goods loaded and later on the security guard verifies the form as well as the loaded goods. 10. After all the above procedure, the bill for the truck is prepared by the billing department. 11. Once the bill is prepared the truck is allowed to move out of the plant. 21
    • PRASHANT DUBEY – INSIGHT GEEKS BILLING PROCESS The Billing process is a simple process which has only 2 stages for the local distribution, but for the inter-unit vehicles it is necessary to prepare the road permits so that the trucks can cross the border of the state. 1. When the driver arrives at the billing unit / department, the very first step is to prepare the L/R (lorry receipt) of the truck. 2. Once the LR is prepared, the L/R, SO and the form prepared by the checker is to be submitted to the billing department. 3. The process of billing is done in the ERP system of the coca cola which is named as “MFGPRO” system prepared by the QAD technologies. 4. The billing department prepares the bill on the basis of the SO number mentioned in the SO document. 5. In the first process, the truck details and the quantity loaded on the truck are entered in to the system. 6. Sometime it happens that the truck loaded has the less no. of quantities then it was mentioned in the SO, so the user on the system has to reduce the number of the quantities in the SO, and the deducted quantity is then again available for the other SO. 22
    • PRASHANT DUBEY – INSIGHT GEEKS 7. The user can reduce the number of quantity but he cannot increase the quantities, so it has to be taken care that the loaded quantity should be equal to the quantity mentioned in the SO. 8. Till then the 50% of the bill is created, the next step is to enter the freight details depending on the truck / transporter. 9. Once the freight details are entered for the truck, the printout of the bill is taken out and given to the truck driver. 10. (For the vehicles of inter-unit it is required to prepare the road permit otherwise the vehicle will not be allowed to enter in to the other state) 11. Then the truck can leave the plant. FREIGHT CALCULATION The Freight department is completely different from the billing department. This department maintains the freight of the trucks with the coordination with the transporter. The Freight of the truck is calculated on the basis of tonnage (weight) of the truck, Kilometers to be travelled and the charge asked by the transporter for the truck. Each transporter provides their truck on the different rates. It is the job of the freight department to collect the details of the freight from the different transporters and enter them in to the system. So at the time of preparation of bill when the user will enter the name of the transporter the freight will be automatically applicable at for that vehicle. There are 3 different types of freight: 1. Fixed – The fixed rate is applicable for the trucks which are owned by the company or which are taken over on a contract of a specific period of time. For example: If a truck is taken from the transporter at a price of 12 lakhs for month then a fixed charge is applicable for that truck. It doesn’t matter that what is the weight of the goods loaded on the truck or how many trips does the truck has completed. 23
    • PRASHANT DUBEY – INSIGHT GEEKS 2. Variable – The variable rate is applicable when the rate is not fixed for that vehicle. The fixed and variable charges are applicable on the trucks of 2 ways, which means that the truck will come back to the plant after the delivery is done. 3. Tonnage – The tonnage charge is applicable when the freight is calculated on the basis of the weightage of the truck and the truck is a one way truck i.e. the truck will not return after delivering the goods. 24
    • PRASHANT DUBEY – INSIGHT GEEKS RTM (ROUTE TO MARKET) The route to market process is divided in to 2 processes Distribution and Fleet Management. DISTRIBUTION PROCESS The distribution process is the process which starts from getting the order from the distributors till delivering the goods to the distributors. This complete process comes under the distribution process. Coca cola Gujarat is currently having 303 distributors throughout the state. 1. The very first step in the distribution process is to collect the order from the distributors. 2. To do the above process, the company has hired the sales team, it is the job of every sales person to coordinate with the distributor and get the order. 3. Each distributor has their PDP (Permanent Dispatch Plan), i.e. there are some fixed days like Wednesday, Friday & Sunday. So on these specific days the sales person will get the order from the distributor. 25
    • PRASHANT DUBEY – INSIGHT GEEKS 4. As shown in the above figure, the sales agent contacts the distributor. But in the area where the distributor is not allocated, over there the sales agent goes to each retailer and gets the order personally. BY CONTACTING DISTRIBUTOR 1. In the area where the company has its distributor, the sales agent gets the order and submits the order details to its head department. 2. The department will enter the order details in the KOMPASS software and that application will get the complete details of the order like total amount, no. of cases, weight, etc. 3. The total weight of the order should be according to the required norms, because of the weight of the order is too less than the company will not be able to load the truck and send it to distributor, as they will face loss on that truck. 4. The solution for the above problem is that, if the weight is low as per required, the agent club the orders of 2 nearby distributor so that the truck can be loaded and no loss is beard by the company. 5. So once the order is confirmed from the distributor, the total amount is informed to the distributor and the distributor has to deposit that amount in the company’s account then only the goods will be dispatched. 6. The distributor has to file the RTGS (Real time gross settlement) for the quick settlement of the order. 7. Once the payment is confirmed, the order is displayed in the system of distribution center. 26
    • PRASHANT DUBEY – INSIGHT GEEKS 8. The job of the DC is to confirm the order and dispatch the required order to the distributor. BY CONTACTING DIRECTLY RETAILER 1. In the areas where the company does not have any distributor, at that place the company has its own depot. 2. The sales agent from the depot has to visit the retailer to get the order. 3. Each sales person is allocated an area which is called PJP (Permanent Journey Plan). The sales person has to move as per their journey plan so that no retailer is missed out. 4. The sales person has been given BLACKBERRY mobile phones in which they have to take the order; the mobile phones are directly linked to the system of the depots. 5. So when the retailers gives the order to the sales person the sales person enters the details in the BLACKBERRY and that order is directly visible in the system. 6. By the 7 PM in the evening the process of taking the order stops. 7. Now the next process is to get the details from the system at the depot, it is gathered by the respective person and then the next day the delivery is made to the retailer. 8. The retailer has to pay at the spot when the goods are being delivered; no RTGS takes place for the retailer. MILK ROUTE DISTRIBUTION 1. Milk route distribution is the 3rd process through which the goods are delivered to the retailers. 2. In the above 2 processes the sales agent has to contact the distributor or retailer, but the process of milk route distribution is completely different. 3. In this process, a truck filled with almost all the products leaves the depot and go on its journey, then it stops at each shop on a selected route and ask for the order. If the retailer gives the order then the person provides the order at the spot and the retailer pays the amount at the spot. 27
    • PRASHANT DUBEY – INSIGHT GEEKS FLEET MANAGEMENT Fleet management is the second process of the RTM, the shipping department has to manage the fleet by ordering the trucks from the transporter. The requirement of trucks is changed on the daily basis, depending on the order given by the distributor or retailer. So the company cannot hire a fixed number of trucks for the period. So to enhance the process and make it cost effective the shipping department coordinates with the transporter and orders the trucks. It is to be taken care that the trucks arrives in the time at the DC, because of that won’t be done then there will be delay in delivering the goods to the distributor. 28
    • PRASHANT DUBEY – INSIGHT GEEKS SWOT ANALYSIS STRENGTHS: STRONG DISTRIBUTION NETWORK: The Company has a strong and reliable distribution network. The network is formed on the basis of the time of consumption and the amount of sales yielded by a particular customer in one transaction. It has a distribution network consisting of a number of efficient salesmen, 700,000 retail outlets and 303 distributors. The distribution fleet includes different modes of distribution, from open-bay three wheelers to 10-tonne trucks that can navigate through narrow alleyways of Indian cities. STRONG BRANDS: The products produced and marketed by the Company have a strong brand image. People all around the world recognize the brands marketed by the Company. Strong brand names like Sprite, Fanta, Limca, Thums Up and Maaza add up to the brand name of the Coca-Cola Company as a whole. The red and white CocaCola is one of the very few things that are recognized by people all over the world. Coca-Cola has been named the world’s top brand for a fourth consecutive year in a survey by consultancy Interbrand. LARGE SCALE OF PRODUCTION: As Coca-Cola is the leader of the soft drink beverages in the country, the level of production is much higher as compared to the level of production of the competitors. So as the volume of production will increase the cost of the product can be decreased. This will give a tough competition to the competitor. 27 CONSECUTIVE QUARTERS OF GROWTH: The Coca-Cola India has filed the 27th consecutive quarters of growth which means that the company is in stage of earning profit from the last 27 financial quarters which is very good for a company. This can boost the performance of the company and demotivate the competitors too. 29
    • PRASHANT DUBEY – INSIGHT GEEKS WEAKNESS: NEGATIVE PUBLICITY: Many of the health conscious people in India consider the carbonated soft drinks as a health destroyer which affects the health of the person. It effect to the bones of the human being. In India sometimes the CSD are referred to the “toilet cleaners”. So as Coca-Cola is the country’s biggest brand in this category, it has to face the consequences. 30
    • PRASHANT DUBEY – INSIGHT GEEKS CONTROVERSIES: In India, there exists a major controversy concerning pesticides and other harmful chemicals in bottled products including Coca-Cola. In 2003, the Centre for Science and Environment (CSE), a non-governmental organization in New Delhi, said aerated waters produced by soft drinks manufacturers in India, including multinational giants PepsiCo and Coca-Cola, contained toxins including lindane, DDT, malathion and chlorpyrifos- pesticides that can contribute to cancer and a breakdown of the immune system. SMALL SCALE SECTOR RESERVATIONS LIMIT ABILITY TO INVEST AND ACHIEVE ECONOMIES OF SCALE: The Company’s operations are carried out on a small scale and due to Government restrictions and ‘red- tapism’, the Company finds it very difficult to invest in technological advancements and achieve economies of scale OPPORTUNITIES: LARGE DOMESTIC MARKETS: The domestic market for the products of the Company is very high as compared to any other soft drink manufacturer. Coca-Cola India claims a 58% share of the soft drinks market; this includes a 42% share of the cola market. Other products account for 16% market share, chiefly led by Limca. Coca-Cola amounts for 74% of the beverage market. ACQISITIONS: As the Coca-Cola is acquiring the Indian beverage market on a large basis many other domestic companies are dying. So to increase the number of brands in the company’s portfolio there is an opportunity for the company by acquiring the popular brands of the other companies and increase the percentage of market ownership. EXPORT POTENTIAL: The Company can come up with new products which are not manufactured abroad, like Maaza etc and export them to foreign nations. It can come up with strategies to eliminate apprehension from the minds of the people towards the Coke products produced in India so that there will be a considerable amount of exports and it is yet another opportunity to broaden future prospects and cater to the global markets rather than just domestic market. GROWING BOTTLED WATER MARKET: The bottled water market in India is increasing day by day, but the market is still captured by the other leaders in the market like Bisleri, Aquafina, and the other small domestic players. So the Coca-Cola can try its best to acquire the market through its product KINLEY. 31
    • PRASHANT DUBEY – INSIGHT GEEKS HIGHER INCOME AMONG PEOPLE: Development of India as a whole has led to an increase in the per capita income thereby causing an increase in disposable income. Unlike olden times, people now have the power of buying goods of their choice without having to worry much about the flow of their income. The beverage industry can take advantage of such a situation and enhance their sales. THREATS: INTENSE COMPETITION: The Company is facing a tough competition from its leading competitors in the country. The competitors are trying their best to convince the youngsters by advertising a lot with the popular actors of the film industry. This can increase the share of the competitor in the market. IMPORTED PRODUCTS: As India is developing at a fast pace, the per capita income has increased over the years and a majority of the people are educated, the export levels have gone high. People understand trade to a large extent and the demand for foreign goods has increased over the years. If consumers shift onto imported beverages rather than have beverages manufactured within the country, it could pose a threat to the Indian beverage industry as a whole in turn affecting the sales of the Company. DEPENDENCE ON BOTTLING PARTNER: The Company is much dependent on its FOBO (bottling partner) so the company cannot success without the proper coordination of its bottling partner. TAX AND REGULATORY SECTOR: The tax system in India is accompanied by a variety of regulations at each stage on the consequence from production to consumption. When a license is issued, the production capacity is mentioned on the license and every time the production capacity needs to be increased, the license poses a problem. Renewing or updating a license every now and then is difficult. Therefore, this can limit the growth of the Company and pose problems. 32
    • PRASHANT DUBEY – INSIGHT GEEKS TARGET / TASKS The task for the internship was to optimize the transportation system from plant to DC. The Coca-Cola goblej has recently opened the DC which is approx. 2 kilometer away from the plant. The company wants to dispatch the at least 80-100 thousand of cases per day from plant to DC, but due to certain issues this was not happening. The company has hired 12 trucks which can carry of 21 tons of goods at one time. The truck works for all the three shifts. So my task was to analyze the problem which is depleting to achieve the target and help the company to achieve the target of the no. of trips made by truck in a single shift. ACHIEVEMENTS I learned lot things in these 45 days of internship. Starting from the excel functions which are commonly used all most all the leading firms to the shipping and supply chain process of one of the world leading beverages company. The very first two weeks of the internship gave me the experience of the corporate environment and the remaining days at the plant gave me the experience of the life at a plant of any company. The plant environment is completely opposite to the corporate environment. I learned the excel functions like VLOOKUP, CONCATENATE, HLOOKUP, etc. which will surely help in future. Learning of the supply chain management of such a big company gave me the practical experience of the supply chain functions of the company. 33
    • PRASHANT DUBEY – INSIGHT GEEKS FINDINGS Following are the few points which can help to improve the transportation system: 1. The SO’s should be kept prepared in advance, because it happens that in the morning the trucks are loaded and standing at the gate, but due to no SO available for that truck the truck is not able to leave the plant. 2. The location of shipping unit should be changed and bring it back to the warehouse, the reason is that by the time the truck loading is confirmed and the driver is tying the ropes, the bill can get prepared and the truck can then directly leave the plant. 3. The billing for empty trucks should be bringing out of the billing department, it is a easy process which can be done by the security guard also, requires no system. 4. Increase in the no. of the billing person, there should be a person who can delegate the job of billing in-charge to ensure the quick functionality of billing. 5. The checkers should ensure the quick loading of the FG on the trucks, sometimes it happens that a single forklift go to warehouse and brings the FG, after lining them up the, the same forklift loads them on the truck. This process consumes a lot much of time. 6. In the morning if no truck is available at the bay, then a preloading should be set near the loading bay. So that when the truck will arrive, loading can be directly started. 7. The lunch time for the forklift drivers as well as the truck drivers should be the same. After the specified period of time the truck driver should not be allowed to take break. If the truck drivers are at DC at the time of lunch, then the lunch should be provided over there. 8. Sometime it happens that the driver does not deliver the SO and yellow form for the L/R on time, he keeps on sitting in his vehicle. So a person should take care that as soon as the truck comes near the billing area, he should collect the form and get it for billing purpose. 9. In each truck there are 2 drivers, both the driver should take the lunch, breakfast, & dinner alternatively. So that if one driver is having its lunch then the other driver can complete one trip and when he comes back the other driver can do his trip and by the time both would have taken their lunch. 10. Sometime it happens that the loading bay is empty and the truck is standing near the gate, so this is to be informed to the driver that if he wants to go for lunch then he should leave the truck at the loading bay so that by the time the truck is loaded he would have taken the lunch. 34