Executive Summary After the Economic Liberalization and industrial promotion measures taken bygovernments, Indian job market

is abundant in opportunities and career growth forHuman resources. Whereas in post industrial reforming years the condition ofemployment here was not good enough and people were used and exploited likeanything but for now the era has changed and India has emerged as a Leader inhuman capital which is not only hardworking but well deserving as far as academiccredentials are concerned. Moreover as the paradigm has also changed from that verycommonly used mechanistic approach, towards the human approach and humanresource department is no treated like Justas picnic organizers but as strategicbusiness partners which is justified and proved to play very important role in the growthof business and achieving corporate goals and objectives by so many companies which are following these approaches. Thats why I have chosen this topic Rec ruitment and Selection and salary and Wages policy for summer training project and completed it at Varun Beverages Ltd PepsiCo , Jaipur.The main objective of selecting this topic was to have a thorough insight, howrecruitment and selection process is carried out practically and what are its variousmethods apart from all classroom lecturers. Since the role of HR has changed, so themain focus here is to attract, grab and retain the talent and more importantly developingmanagers and leaders in organization and this is possible only when you as arecruitment manager select such type of employees for the company, you work for. Theproject lasted for 45 days and I along with my batch members learnt a lot of pros andcons of the whole process. The whole report is descriptive as well as analytical. Thecontent I have collected from text books, journals, websites and data from survey ofVBL employees. As the Training period was little bit insufficient so I could not get thewhole know-how about the working of HR and the organization was not using softwarefor data storage i.e. file system is still in vogue there. But this first hand experience ofcorporate HR functions provided by college is meaningful and applicable for me infuture

CHAPTER-1 INDIAN FMCG INDUSTRY CONTRIBUTION OPPORTUNITIRSPOLICY & REGULATORY FRAMEWORKPROFILE OF PEPSICO INTERNATIONALPROFILE OF PEPSICO INDIAPROFILE OF PRODUCTSPRODUCTS TYPES

1 INTRODUCTION TO INDUSTRY 1.1 INDIAN FMCG INDUSTRY: AN INTRODUCTION The Fast Moving Consumer Goods (FMCG) industry in India is one of the largestsectors in the country and over the years has been growing at a very steady pace. Thesector basically consists of consumer non-durable products, which broadly consists,personal care, household care and food & beverages.The Indian FMCG industry is largely classified as organized and unorganized. Thissector is also buoyed by intense competition. Besides competition, this industry is alsomarked by a robust distribution network coupled with increasing influx of MNCs across the entire value chain. This sector continues to remain highly fragmented.The FMCG industry is volume driven and is characterized by low margins. The productsare branded and backed by marketing, heavy advertising, slick packaging and strongdistribution networks. The FMCG segment can be classified under the premiumsegment and popular segment. The premium segment caters mostly to the higher/uppermiddle class which is not as price sensitive apart from being brand conscious. The pricesensitive popular or mass segment consists of retailers belonging mainly to the semi-urban or rural areas who are not particularly brand conscious. Products sold in thepopular segment have considerably lower prices than their premium counterparts. 1.2 CONTRIBUTION OF INDIAN FMCG INDUSTRY After registering a 12% growth in 2009 despite the economic downturn, major FMCGfirms remain optimistic and expect a 15% growth in 2010. The Indian FMCG industrysales are estimated to grow 14.5% to reach RS 854.7 Billion. Within the Indian FMCG industry, there are few sectors that will grow more than 20% during 2009-2010, likeshaving cream at 23%, skin/fairness cream at 22%, shampoos at 21.3%, skin care &cosmetics at 20%, tooth powder at 22% and other care products.The prediction of higher sales growth of FMCG products is based on strong economicfundamentals such as rising disposable income of people. Now people can afford tospend on quality FMCG products. Moreover, increasing salaries, along with rising trend of perks in the corporate sector at regular intervals, have increased peoples spending power on lifestyle products. Even government employees too are expending on lifestyleproducts helping FMCG sector to grow rapidly.Apart from this, India is rapidly changing into an urban country and with that, peoples preference for lifestyle products is growing. Hence, the Indian FMCG industry isexperiencing strong growth in some categories such as skin care, anti-aging solution,deodorants, fairness pr oducts and mens products. In addition, the emergence of organized retail such as supermarkets, and shopping malls is also playing an importantrole in bringing boom in the Indian FMCG market. The young generation of consumersis driving the demand for lifestyle products.Consumers are at the front seat changing and redefining the branding and marketingstrategy and marketplace for the retail products that are ultimately boosting the retailsales in the country. However, the fear of dissociation with earlier consumers stillpersists as they embrace and prefer to stick to established brands only. The mainreason for this dissociation is weak distribution channels and marketing strategy in thecountry.According to a Research Analyst atRNCOS,

The demand for lifestyle products is boosted by the rising aspiration and modern facilities. As the spending power ofconsumers is going up, the sales of FMCG products in India will rise too. Therefore,companies need to improve the quality of products and employ right marketing mix by implementing new technologies such as Customer Relationship Management. 1.3 OPPORTUNITIES With fast-evolving lifestyles and the increasing disposable income of urbanconsumers, there exists a definite opportunity for lifestyle and high-end products. With more than 33 per cent of the Indian consumer base present in rural areas,the rural market will be a key growth driver for FMCG majors planning to expandtheir domestic business. Indian consumers are highly adaptable to new and innovative products. For instance, the market acceptance of mens fairness creams clearly demonstrates an opportunity for companies to offer new products targeting specific customersegments. Indian and multinational FMCG players can leverage India as a strategicsourcing hub for cost-competitive product development and manufacturing fortheir international markets. 1.4 POLICY AND REGULATORY FRAMEWORK Automatic investment approval (including foreign technology agreements withinspecified norms) up to 100 per cent foreign equity, or 100 per cent for NRI andoverseas corporate bodies (OCBs) investment, is allowed in food processingsegments such as coffee and tea. The Government of India (GoI) recognizes food processing and agro industriesas priority sectors.

 Industrial license is not required for almost all food and agro processingindustries, barring certain items such as beer, potable alcohol and wines, canesugar and hydrogenated animal fats and oils and items reserved for exclusivemanufacture in the small-scale sector. The GoIs announcement of a 4 per cent reduction in excise duty (as part of the earlier stimulus package in December 2008) has impacted the FMCG industrypositively. In October 2009, the GoI amended the Sugarcane Control Order, 1966, andreplaced the Statutory Minimum Price (SMP) of sugarcane with Fair andRemunerative Price (FRP) and the State Advised Price (SAP). India is set to implement Goods and Services Tax (GST) by April 1, 2011. Thismove is expected to stimulate growth in the Indian FMCG industry. 1.5 FOOD AND BEVERAGE INDUSTRY IN INDIA: A BRIEFINSIGHT

FOOD According to the Ministry of Food Processing, the size of the Indian food processingindustry is around US$ 65.6 billion including US$ 20.6 billion of value added products.Of this, the health beverage industry is valued at US$ 230 billion; bread and biscuits atUS$ 1.7 billion; chocolates at US$ 73 million and ice creams at US$ 188 million. Thesize of the semi-processed/ready to eat food segment is over US$ 1.1 billion. Largebiscuits & confectionery units, soya processing units and starch/glucose/sorbitolproducing units have also come up, catering to domestic and international markets. Thethree largest consumed categories of packaged foods are packed tea, biscuits and softdrinks. BEVERAGES The Indian beverage industry faces over supply in segments like coffee and tea.However, more than half of this is available in unpacked or loose form. Indian hotbeverage market is a tea dominant market. Consumers in different parts of the countryhave heterogeneous tastes. Dust tea is popular in southern India, while loose tea inpreferred in western India. The urban-rural split of the tea market is 51:49 in 2000.Coffee is consumed largely in the southern states. The size of the total packaged coffeemarket is 19,600 tons or US$ 87 million. The urban rural split in the coffee market is61:39. The total soft drink (carbonated beverages and juices) market is estimated at 284million crates a year or US$ 1 billion. The market is highly seasonal in nature withconsumption varying from 25 million crates per month during peak season to 15 millionduring offseason. The market is predominantly urban with 25 per cent contribution fromrural areas. Coca cola and Pepsi dominate the Indian soft drinks market. Mineral watermarket in India is a 65 million crates (US$ 50 million) industry. On an average, themonthly consumption is estimated at 4.9 million crates, which increases to 5.2 millionduring peak season.

In India, beverages form an important part of the lives of people. It is anindustry, in which the players constantly innovate, in order to come upwith better products to gain more retailers and satisfy the existingretailers.

FIGURE: BEVERAGE INDUSTRY IN INDIA The beverage industry is vast and there various ways of segmenting it, soas to cater the right product to the right person. The different ways ofsegmenting it are as follows: Alcoholic, non-alcoholic and sports beverages. Natural and Synthetic beverages. In-home consumption and out of home on premises consumption. Age wise segmentation i.e. beverages for kids, for adults and forsenior citizens. Segmentation based on the amount of consumption i.e. high levelsof consumption and low levels of consumption.

If the behavioral patterns of retailers in India are closely noticed, it couldbe observed that retailers perceive beverages in two different ways i.e.beverages are a luxury and that beverages have to be consumedoccasionally. These two perceptions are the biggest challenges faced bythe beverage industry. In order to leverage the beverage industry, it isimportant to address this issue so as to encourage regular consumptionas well as and to make the industry more affordable.Four strong strategic elements to increase consumption of the products ofthe beverage industry in India are: The quality and the consistency of beverages needs to be enhancedso that retailers are satisfied and they enjoy consuming beverages. The credibility and trust needs to be built so that there is a verystrong and safe feeling that the retailers have while consuming thebeverages. Retailer education is a must to bring out benefits of beverageconsumption whether in terms of health, taste, relaxation,stimulation, refreshment, well-being or prestige relevant to thecategory. Communication should be relevant and trendy so that retailers areable to find an appeal to go out, purchase and consume.The beverage market has still to achieve greater penetration and also awider spread of distribution. It is important to look at the entire beveragemarket, as a big opportunity, for brand and sales growth in turn to add upto the overall growth of the food and beverage industry in the economy. 1.6 SOFT DRINKS MARKET IN INDIA India is one of the top five markets in terms of growth of the soft drinksmarket. The per capita consumption of soft drinks in the country isestimated to be around 6 bottles per annum in the year 2009. It is verylow compared to the corresponding figures in US (600+ bottles perannum). But being one of the fastest growing markets and by the sheervolumes, India is a promising market for soft drinks. The major players inthe soft drinks market in India are PepsiCo and Coca-Cola Co, likeelsewhere in the world. CocaCola acquired a number of local brands likeLimca, Gold Spot and Thumps Up when it entered Indian market for the second time. Pepsi Cos soft drink portfolio also consists of Miranda and 7Up along with Pepsi. The market share of each of the company is moreor less the same, though there is a conflict in the estimates quoted bydifferent sources.The major ingredient in a soft drink is water. It constitutes close to 90%of the soft drink content. Added to this, the drink also containssweeteners, Carbon dioxide, Citric Acid/Malic acid, Colors, Preservatives,Anti Oxidants and other emulsifying agents, etc.

1.7 PROFILE OF PEPSICO INTERNATIONAL Type Public(NYSE:PEP) Industry FoodNon-alcoholic beverage Founded New Bern N.C, U.S. (1890) Founder(s) Caleb Bradham,Donald M.andHerman W. Lay Headquarters Purchase, New York,U.S. Area served Worldwide Key people Indra Nooyi(ChairpersonandCEO) Revenue US$44.3 billion OperatingIncome US$7.3 billion Net income US$6.24 billion Total assets US$39.8 Billion( FY 2009 ) Total equity US$16.8 Billion( FY 2009 ) Employees 203,000 ( 2010 ) Divisions PepsiCo Americas (PepsiCoAmerica Food, PepsiCo AmericasBeverages), PepsiCo International Website PepsiCo.com