2. ABSTRACT
The case discusses the strategies adopted by the soft drinks and snack foods major PepsiCo to
enter India in the late 1980s.
To enter the highly regulated Indian economy, the company had to struggle hard to 'sell' itself to
the Indian government.
PepsiCo promised to work towards uplifting the rural economy of the terrorism affected north
Indian state of Punjab by getting involved in agricultural activities.
In addition, it made a host of other promises that made its proposal very attractive to the
regulatory authorities.
The case also discusses the criticisms levelled against the company criticism of its failure to honour
many of its commitments after it started operations in the country and after the liberalization of
the Indian economy.
Finally, the case takes a look at the contract farming initiatives undertaken by Pepsi since the
1990s and seeks to critically analyse the strategies used by the company to enter India
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3. POST AND PRE GLOBALISATION
CHANGES IN INDIAN MARKET
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4. STRATEGIES ADOPTED TO ENTER THE
HIGHLY REGULATED MARKET
Alliance with rpg group
Proposal to export juice concentrate from Punjab
Promoting and developing the export of indian agro-based products
Setting up fruit and vegetable processing plant in zathura village
Alliance with local farmers for contract farming of tomatoes
Restriction of 25% in overall investment for beverages
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5. Growth avenues observed
Large market
Limited competition
Final stage in parent market(USA)
Availability of large farms and effective irrigation
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6. Why company changes its strategies In
tune with changes in regulatory
environment of foreign country
To expand business
To explore newer markets
To grab opportunities
To be in good terms with the government
To cut out competition
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7. How to enter regulated economy of any
country
Form a strategic alliance with a local company
Promote overall development of the country
Forming alliance with the native government
Promote access to foreign exchange
Introduction of technology
Better opportunities to work
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8. Do we have to wait for good
opportunities in business
No
we need to be in business to avail the good opportunities that passes by.
Good opportunities means exponential growth for which business have to be
there first.
Risk of letting go of the business to the competitor
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9. Are foreign players good for Indian
economy growth
Yes and no.
They contribute to the GDP by increasing foreign exchange.
They help in creating new jobs.
Access to latest technology
Promotes political peace and treaties among nations
Disastrous for local business which cannot compete due to economies of scale in
production
Prevents development of local manufacturing and services.
Exploitation of resources
Devaluation of currency
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10. Are we capable to meet the
expectations of the foreign
players?
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