18-04-2014, 11:18 AM
CASH MANAGEMENT SYSTEM AT PEPSI
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INTRODUCTION
This Research Report is very practical approach for me being a student. All students learn theoretical subjects in their classroom, but as we are the management students, apart from theoretical studies we need to get a deeper insight into the practical aspects of those theories by working as a part of organization during our Research Report is a period in which a student can apply his theoretical knowledge in practical field. Basically practical knowledge and theoretical knowledge have a very broad difference.
So this training has high importance as to know how both the aspects are applied together.
The study of management acquires most crucial position in the business administration. In order to be successful, it is necessary to give priority to the management in an organization. But it can’t be denied that the study of management would be more educational, materialistic and even more interesting, if it is to be paired with the work in organization as an employee.
The training session helps to get details about the working process in the organization. It has helped me to know about the organizational management and discipline, which has its own importance. The training is going to be a life long experience.
Background of the study
Pepsi have been using two techniques for managing cash inflow – Cash Management Services (CMS) provided by ICICI CORPRATION.
HDFC HSBC & UTI bank and Short term financing through Letter Of Credit (LC). The first Technique is used to manage the funds through cash sales and the other is used in case of sale on credit.
In case of Cash Sales the Industry had to wait for 4-5 days before it could realize the cash (in case the customer paid through draft. In case of payments through cheques the lag as even larger) as the customers are based in different locations in India. So the basic aim of the project is to evaluate the cost benefit to after adopting CMS. The project stress on the ways to further lower down the cost of procuring funds through cash sales by doing a comparative analysis of the banks providing this facility to the corporate.
Letter of Credit also is important means of procuring funds as the corporate can realize the payment against sale made on credit terms. The project intends to study various terms and conditions involved in realizing payments through LC. It also throws light on the procedures to be followed to realize payments as if any of the terms and conditions of an LC remains unfulfilled the bank is under no obligations to make payment. The transactions in the steel industry are usually of high value that runs into lakhs and crores. Also, LC insures the credibility of buyer and seller as the transactions are through banks.
Establishment of Cash Collections : Industry must establish the collection centers in different parts of the country to save the postal delays. This is known as
concentration banking. Under this system, the collection centers themselves collect payments from customers & deposit them in local bank account. The concentration banking results in saving of time of collection & hence result in better cash management.
(iii). Lock-Box : Under this system, the Industry hires a post-office box at important collection centers. The local bankers of the Industry are authorized to pick up the cheques from the lock-box. The bank informs the Industry about the details of cheques received & credited. This system helps to reduce the overhead expenses.
RESEARCH METHODOLOGY
Methodology is the bone of a project. It has also an important place as regards to cash management system project. A person who is going to prepare a project, he should be very aware in connection with collection & analysis of data. I have gone very deeply in preparing the project & I devoted my full attention to get the accurate & real data collection. For this purpose I became in close contact with sources of data collection by personally & through Internet.
INDUSTRY PROFILE
THE PEPSICO.
PepsiCo Inc. was founded in the year 1965. Major products of the new Industry are Pepsi Cola, Diet Pepsi and Mountain Dew. Pepsi entered the Indian market in 1992 and now is the market leader with a market share of 26.5 percent in the cola segment. Pepsi is in between the two of it’s closet competitors as far as marketing strategies are concerned. Pepsi is an international drink with Indian imagery in it’s communication. Traditional focus of Pepsi has been on the early teenager with a gender skew more to the female.
Pepsi is by far the more aggressive player in the market. With in your face advertising, continuous event marketing targeting the new generation and eye catching merchandising. It’s got its selling strategy well mapped out.
The Industry has always been innovating it’s ad campaigns which has helped the Industry to get top of the mind recall. From “The choice of the new generation” to the “Freedom” campaign the Industry has been able to Indianise the brand. With the help of promotional schemes Pepsi has managed to keep the brand alive and has not let it become old. During 1995 the total ad spent by the Industry was Rs.6,98 crore only on television. Pepsi has set aside Rs. 8 crore for its advertising programme in the run up to and during the cricket world cup.
CORPORATE CITIZENSHIP
PepsiCo believes that as a corporate citizen, it has a responsibility to contribute to the quality of life in our communities. This philosophy is put into action through support of social agencies, projects and programes. The scope of this support is extensive – ranging form sponsorship of local programs and support of employee volunteer activities, to contributions of time, talent and funds to programs of national impact. Each division is responsible for its own giving program. Corporate giving is focused on giving where PepsiCo employees volunteer.
PEPSICO HEADQUARTERS
PepsiCo World Headquarters is located in Purchase, New York, approximately 45 minutes from New York City. The seven building headquarters complex was designed by Edward Durrell Stone, one of America’s foremost architects. The building occupies 10 acres of a 144 – acre complex that includes the Donate M. Kendall Sculpture Gardens, a world acclaimed sculpture collection in a garden setting.
The collection of works is focused on major twentieth century art, and features works by masters such as Auguste Rodin, Henri Laurens, Henry Moore, Alexander Calder, Alberto Giacometti, Arnaldo Pomodoro and Class Olden berg. The gardens were originally designed by the world famous garden planner, Russelll Page, and have been extended by Francois Goffinet. The grounds are open to the public, and a visitor’s booth is in operation during the spring and summer.