Cardiff Metropolitan University, UK

Universal Business School, Karjat

Operation Assignment
Based on the industrial visit to
Aje India Pvt. Ltd.

Submitted To

Submitted By

Proff. Sunil Malhotra

Mr. Swaraj Mishra

Roll-st20076740

Aaos family is the owner of AJE group Pvt. Ltd.. The family started the business of the
beverages in Ayacucho, Peru as homemade carbonated beverage named as Kola Real on 23 rd Jun
1988 in the old bottles of bear. With success of Kola Real AJE started Focusing on expansion with
launch of the Kola Real in major cities in Peru namely Huancayo in 1991, Bagua in 1993 and
Sullana in 1994 and also the business expanded from the local retail shop to MOM & POP
shops in Peru.
Figure 1.1 AJE Group

Source: http://www.ajegroup.com/about-aje/

In 1997 the company entered to a new category of Lima soft drink market and soon became
the leader in the beverage industry in Peru.
In 1997 the company went for internationalisation by launching the products in Venezuela.
In 2001 the company entered into the Drinking water category by launching its CIELO
Brand.
In 2002 the company entered in Maxico where the consumption of soft drink per capita is the
2nd highest in the world.
In 2005 the company began its operation in Central America Guatemala.
In 2006 they entered in the market of Spain because they can get the access to both Latin
America and Asia.
In 2006 the company entered in the Thailand market and in 2007 operation started in
Colombia, with a plant in the town of Funza, Bogota.

In 2011, the company entered the Brazilian market with a manufacturing plant in Rio de
Janeiro.
The present chairman of Aje Group is Mr. ngel Aaos Jer and Global CEO is Jorge Lpez
Driga.

In INDIA
Company started its operation in India (Plot No. A21/1, 2 & 3, Midc, Patalganga, Tal.
Khalapur, Raigad - 410220, Maharashtra) in December 2010.
Their competing brands are Pepsi and coke in India. So, they strategically launched their
product with no caffeine, in PET bottle form in a lower price compare to them.
They made ties with the release of the Sony pictures movie, The Amazing Spider-Man and
also launched limited editions of The Amazing Spiderman bottles in three flavours.

Achievements
The company has more than 25 years of experience in the soft drinks industry and 100%
family owned business.
The company is a worldwide MNC company having its presence in 20 countries in 5
continents. It has 26 manufacturing facilities with 89 bottling lines, 20 resin injection lines for
the production of plastic bottles and 10 cap compression lines installed throughout its
operations around the world.
Figure 1.2 Companys Operational Unit World Wide

Source: http://www.ajegroup.com/about-aje/map

The fifth-biggest soft drinks company in Latin America, AJE last year ranked 21 of all soft
drinks makers globally, according to market researcher Euromonitor, with sales of about
$2bn. AJEs global sales grew at an average of 22 per cent a year from 2000 to 2013. (Bland
and Schipani, 2014).

In Asia
AJE has secured about 40 per cent of the Indonesian market for carbonated soft drinks, which
reached about 1bn litres last year, and is worth about $1bn according to Euromonitor. The
aim is to grow by double digits in Indonesia, faster than the market, which is predicted by
Euromonitor to expand by an average 5.6 per cent annually during the next four years. (Bland
and Schipani, 2014)

Why India and Thailand?

Ans: By Global CEO of Aje Group-2011 was our first full year of operations in Indonesia,
Vietnam and India. The Southeast Asian market represents a significant opportunity for AJE;
these countries have large, young and fast-growing populations with lower per capita
consumption of carbonated soft drinks than other regions, such as Latin America. (Weston,
2014)

Vision
Its vision is to become one of the top 20 Multinational Companies in the world.

Brands Of AJE India pvt. Ltd.

Figure 1.3 Brands of AJE India Pvt. Ltd

Source: http://www.ajegroup.com/brands/

Income statement of AJE Group

Source: (Grupo Embotellador Atic S.L., 2012)

Cash flows of AJE Group

Source: (Grupo Embotellador Atic S.L., 2012)

Capital Expenditure of AJE Group

Source: (Grupo Embotellador Atic S.L., 2012)

Balance Sheet of AJE Group

Source: (Grupo Embotellador Atic S.L., 2012)

Analysis of Income Statement of AJE Group

I.
II.
III.

Cost of goods sold is more but the revenue and gross profit are less in 2010 compare
to 2011.
Selling expenses is less compare to 2010. The gap between operating profit between
2010 and 2011 reduces compare to gross profit.
Financial expenses are too high in 2011 compare to 2010. Hence PBT reduces by
25242 (in thousand euros) in 2011 compare to 2010.

Analysis of Cash Flow of AJE Group

I.
II.
III.

Net cash inflows from operating activities are less in 2011(54,419 thousand euros)
compare to 2010(66,879 thousand euros).
Net cash inflows are also less in 2011 compare to 2010(less by 30,507 thousand
euros).
Financial activities are less compare to previous year (2010).

Analysis of Capital Expenditure of AJE Group

I.
II.
III.
IV.

Land and building and construction cost have been increased in 2011 compare to
2010 by 6,943 thousand euros.
Machinery and equipment expenditure are showing an increasing trend. Compare to
2010 the researcher found an increment of 26,902 thousand euros in the year of 2011.
Other fixed asset cost has been increased from the year of 2010.
All the above points are indicating towards the rise of fixed asset which is a good sign
for the company.

Analysis of Balance sheet of AJE Group

I.
II.
III.

IV.

Total equity is more in 2011 compare to 2010 but less compare to 2009 and the
shareholders equity has been decreased compare to 2010.
Noncurrent liabilities have been increased drastically by 59.1010% compare to 2010.
Increasing trend in current liabilities has been found from the balance sheet which
should be controlled. In 2011 it has been increased by 33,500 thousand euros compare
to 2010 and 128,397 thousand euros compare to 2009.
Rise of fixed assets are less compare to rise of liabilities. So, company should give
attention towards the matter.

The company is situated at Patalganga, Taluka- Khalapur, Dist-Raigad in 2010 a free

economic zone(Industrial Zone) declared by the government of Maharastra. The plant is in
the primary location connecting Mumbai-Pune Express Highway for easy transport. The
distance between the plant and Mumbai port is 579 k.m. It is their only plant in India from
where they are transporting to the other parts of the country. Here in this plant the company
has its water treatment plant, blowing unit through which they are making PET, Filler
machine and also a storage house. This place has also an administrative block from where
they are controlling their entire operation.
Figure 1.4 AJE India Pvt. Ltd. Manufacturing Site

Source: (AJE India Pvt.Ltd., Patalganga)

Forecasting
The organisation use forecast pro for the successful forecasting of the demand. To meet the
demand the sales teams, retailor representatives, marketing teams and production team work
hand to hand and communicate with each other via telephone and emails.

Process of Manufacturing
The operation process starts with procurement of the material and ends with the supply to the market
but it will be discuss after this module.
In the manufacturing unit there are five main processes to carryout. The first process is blowing, then
second is labelling, third is cleaning, forth is filling and at the end packaging.
.

Blowing
Process

Labelling Process
Filling Process

Packaging Process
Compressor Unit
All the above process controls by the compressor unit. Starting from the blowing process to
the end of filling process in every steps compressor unit controls the task by controlling the
pressure. There are 2 air pressure units installed in AJE Big Cola plant one is used for higher
range pressure control and the second one operates for lower range pressure works. The
higher end works in between 32 bar to 40 bar for inflating process according to the size of
the bottle whereas the lower range pressure machine operates either in 7 bar to 10
bar(according to the requirement) to stretch the p-form, for conveyer belt operation, for
labelling, for capping and for filling the bottles with syrup.
They are using the ABC compressors for their use.

Figure 1.6 Compressor 1

Figure 1.7 Compressor 2

Source: (AJE India Pvt.Ltd., Patalganga)

Cooling Unit
For a beverage company like AJE group it is necessary to have a cooling unit and this cooling unit is
used to cool the final products at the feeling station. The company is using the Brazilian cooling
machine called Mebrafe for cooling process. It uses Ammonia for cooling process.
Figure 1.9 Mebrafe cooling unit

Source: (AJE India Pvt.Ltd., Patalganga)

Figure 1.9 pressure control screen 1

Figure 1.10 pressure control screen 2

Source: (AJE India Pvt.Ltd., Patalganga)

It is the first process of the manufacturing unit. The company uses the PET and make them in
their plant from the preforms. First they take the preform form the packets and load into the
drum by the machine (Kosme). After that all these preforms go into the blower machine
(krones contiform S20) through the conveyer belt. Here the conveyer belt runs by the air
pressure given by the ABC pressure at an approx. 7 bar.
In blowing machine (krones contiform S20) there are two works to do. First part is to stretch
the preforms according to the length wise that normally uses 8-10 bar pressure and in the
second part the machine uses 32-40 bar pressure to inflate the stretched preform to its desired
size. The machine also uses the infrared radiation technique at the time of applying pressure
to the preforms to get the proper shape.
At a time 20 numbers of the preform can be converted into PETs.
There are 2 supervisors allocated to check this blowing process.
At the end of the blowing process the bottles move forward to the labelling process through
the conveyer belt using air pressure.

Blowing process in a diagrammatic way

Figure 1.11 Preform packet

Figure 1.12 loading into the drum

Figure 1.13 preform going to blowing machine through conveyer belt

Source: (AJE India Pvt.Ltd., Patalganga)

Figure 1.15 Inflating process

Figure 1.16 UV radiations for heating at the

time of inflating

Figure 1.14 stretching process

Figure 1.17 controlling window for the blowing machine

Source: (AJE India Pvt.Ltd., Patalganga)

Output Capacity per Hour by the Krones contiform S20

manufacturing of Bottles in units
36000
30000
24000
12000

Capacity of the bottles

300 ml
500 ml
1.5 litre
3 litre

Labelling Process
The next process of the blowing process is labelling. Normally other beverage company uses
the labelling process after the filling process. In the way from blowing machine to filling
machine this labelling work is done. The neck holding conveyer belt is used and pressure of
air is deployed to move the bottles forward. The pressure is used in this case is 7 bar.
Figure 1.18 neck holding conveyer

Source: (AJE India Pvt.Ltd., Patalganga)

At the time of labelling the bottle is kept air tight. At first label feeder is used to give support
the label to move around the bottle and the entire labelling machine uses a certain
temperature to fix this label. If any problem arises, than the bottle is rejected by the manual
checking process and the staff check the quality of the label before starting the labelling
machine again.
Figure 1.19 air pressure towards the conveyer

Figure 1.20 label feeder machine

v
Source: (AJE India Pvt.Ltd., Patalganga)

Figure 1.20 Inner view of labelling machine

Source: (AJE India Pvt.Ltd., Patalganga)

The entire beverage industry revolves around the filling process where they add the syrup to
the bottle. The process starts with cleaning of the bottles and then the process goes to the
filling machine where the syrup is pour into the bottle and then at the end the capping is done.
The filling process is done in a cooling (using NH3) temperature. The filler machine can fill
up 120 bottles at a single revolution and according to the requirement the speed can be
controlled by the operator. The lead time is approx. 0.1 second. An automatic rejection
process operates to reject the half filled, over filled and any other faulty bottles.
The name of the filling machine that the company uses is Sacmi filling machine.
Figure 1.21 Filler machine

Source: www.drinktec.com

Figure: 1.22 Scami layouts for the filling procedure

Source : (AJE India Pvt Ltd. Patalganga)

The filling procedure in a flow chart form can be given below.

Figure: 1.23 filling procedure in flat chart form

Figure 1.24 syrup container

Figure 1.25 caps on conveyer belt for capping

Source: AJE India pvt. Ltd., Patalganag

Capacity of Filler machine per minute output according to the capacity of the bottle
NUMBER OF BOTTLES
700
500
300
200

CAPACITY
300 ml
500 ml
1.5 litre
3 litre

Source: AJE India pvt. Ltd., Patalganag

The rejection machine works automatic with sensor. Its operating scene looks like below figure.
Figure 1.26 rejection information

Source: AJE India pvt. Ltd., Patalganag

The packaging process starts after the filling, capping and checking processes. After that
there is a process called tagging where the automatic machine tags each and every bottle with
the manufacturing date, time, shift and number. So, that it can be tracked at any time.
After this tagging the bottles go to the packaging unit where the packaging process is done
with a high temperature plastic material. The hitting process is so that the plastic tightly fitted
to the bottles.
After this packet was made again a tagging process starts like previous tagging.
At the end the packet goes towards the palletizer through conveyer belt. At finally the lifting
machine is used arrange orderly the batches for further transportation in the warehouse.
Figure: 1.27 Packaging Machine

Source: (AJE India Pvt Ltd. Patalganga)

Number of Bottles per Case

Pack Size (ml)

Per case Bottle

300

96

500

48

1500

24

3000

12

Package size calculation for AJE Group

Capacity

Per case

Per Layer

Per Pallet

300 ml

4 packets

15 packets; 3.75 c/s

30 c/s

500 ml

4 packets

24 packets;6 c/s

42 c/s

1.5 litre

2 packets

12 packets;6 c/s

24 c/s

3 litre

2 packets

15 packets;7.5 c/s

22.5 c/s

Figure 1.28 tagged packet

Figure: 1.29 Palletizer crane

Figure: 1.30 slotted pallets waiting for transportation

Source: (AJE India Pvt Ltd., Patalganga)

krones contiform S20 in blowing process

The organisation is using PET instead of glasses and the most important thing is that they are
manufacturing their own required PET bottles. From the research it has been found that they
are using krones contiform S20 to make PET. By using this they have their own control over
the production of the bottles and they are not required to depend on any other vendor for the
supply of the PETs/bottles.
But the main disadvantage is using this Krones contiform S20 is that the Krones
Group does not have their service centre in India. For any problem either the company has to
depend on their online service centre. The nearest service centre is Bangkok which is 9 hours
journey from Mumbai. To get a physical presence the organisation has to wait for a 12 hours
means the company has to short down its entire process for a half day. For which the
company has to pay the losses and as they are in the starting phase in India. It will cost them
much more and in other hand it is their only one production unit in India which means they
could not afford an hour unnecessary breakdown.
Problem may be appearing as a simple problem but if it occurs in the summer when the
organisation needs it full operation at that time it will become a heart stroke to the company.
It is highly technical and if due to any reasons the operator fail to join the organisation for a long time
they dont have the back up and if they will go for training programme for that machine it will
become a time taking process as the operating process course is only available in online in the
company website and the company dont have any physical training c (Nicholson, 2010) (Products :
Product Features, n.d.) (Organisational Excellence : Operational Excellence : Design for Six Sigma,
n.d.) (Home : Enablers : Lean Six Sigma and Innovation, n.d.)entre in India.
Figure: 2.1 Service centre of krones contiform S20 world wide

Source: http://www.krones.com/en/service/lcs-centres.php

Water treatment process of AJE India pvt. Ltd., Patalganga

For a soft drink manufacturing company the quality of water is very important. The taste of
water decides the quality of the soft drinks and also one should not forget the water treatment
is the necessary step before packing it to the bottles either as soft drinks or as distilled water
to drink.
The organisation has set up a water treatment plant inside its premises in Patalganga. But the
organisation is using the government supply water. After getting the water the organisation is
purifying the supplied water through the water treatment plant and using it for the soft drinks.
In Mumbai the supplied water is coming from the sea with treatment and the further
treatment inside the plant making it taste less. So, it is better to use the underground water for
treatment and then further it can be used in soft drinks by which the taste will be better.
Also dependent on the supply of water for the government in India may cause you losses due
to supply interruption.
Any problem towards the water treatment plant will stop the entire production. So it should
be properly taken into care.
Figure 2.2 Water treatment plant in AJE group

Source: (AJE India Pvt Ltd., Patalganga)

Figure 2.3 Water treatments Procedure

Chlorine

Single line production

The organisation has been operating since 2010. But the organisation has only one production
line that is supplying the entire country from Kashmir to Kannyakumari. As a result the
penetration of the company in Indian market is very less and they are not stretching
themselves to produce more and to improve their market share. Because they have only one
line production unit at the time of any severe problem they do not have any other production
unit to back up the production or to fulfil the demand in the market.
Also due to the single production line it will become difficult for them to introduce any new
item to the market.

Waste Management
For any manufacturing unit waste management is very important. One can use it by recycling the
waste or can sale it to any garbage collection unit. But for a beverage industry recycling the waste
product will be difficult and it will cost them more in the terms of money, time and labour cost. Due
to this reasons it is better to sale the waste materials in minimum time to avoid inventory cost and the
organisation will also get some revenue by selling this waste materials.
Here the company is also selling the waste materials to garbage collectors. The rate of scrap items for
waste management is given below for the AJE India Pvt. Ltd..

Figure 2.4 Scrap items with rate

Source: (AJE India Pvt Ltd., Patalganga)

Use of Lean Manufacturing

There is a general perception that Lean Manufacturing and related continuous improvement
businesses do not lend themselves to easy application in industries that have large batch
processes, like the food and beverage industries. (Heymans, n.d.)
The industry uses large distribution or product mixing centre, and manufacture according to
the forecast and usually the forecast lead time to production is long, as a result there is a huge
gap between the forecast that drives production level, and actual demand.
These many variable combinations of lead times, growing cycle times and production lead
times add complexity to an already complex business.
Some of the obstacles for soft drinks processors in terms of adopting lean manufacturing
process for improvement are given below.
I.
II.
III.

Lack of persistent and challenging leadership.

Failure to link the processes in kaizen with normal work.

Lack of patience and follow through.
Failure to engage and involve employees at all levels in the process from an early stage.
Holding to the presumption that lean methods cost a lot of money.

IV.
V.

Persistent focus only on demanding results without a balanced focus on

improving the processes that achieve the results.
Perpetuating a blaming and judgmental culture.

VI.

Some of the areas where the lean manufacturing system should applied for further
improvements are given below.
1.
2.
3.
4.
5.
6.

Overproduction.
Inventory.
Transportation (of material).

Human Resource.
Waiting time.
Defects.

AJE India pvt. Ltd. has been working in India since 2010. For the entire production the
requirements are preforms, caps, labels, sugar, syrup, water, NH3 and CO2.

Preforms
From the beginning the company is producing the PET and not using glasses for beverages.
To make PETs preforms are required. As the company has its own PET formation machine, it
is only purchasing preforms. Initially the company was buying all the preforms from Ms.
Ayacucho Preform Co., Ltd. But due to the demand in the market for big cola are increasing
and the lead time to reach the preforms from Thailand based Ms. Ayacucho Preform Co. is
more (approx. 45 days). Hence they are focusing on buying the preforms from the local
venders from Pune. The company that provides the preform to AJE India is Annapurna
PET. But still the local supply is only 75% and they are still purchasing 25% of preforms
from the Thailand based company. It is happening due to the fact that the AJE India has a
product in the 3 Litre categories but in India the preform size for that 3 Litre category is not
available. All the competitors of AJE INDIA (Big cola) have 2.5 lit. categories and the
company is competing with his 3 litre category with other 2.5 litre categories by providing in
comparative lower price. Hence company is not willing to leave his edge over the
competitors on this category.
Figure 3.1 Preforms from Thailand

Figure 3.2 Preforms from Annapurna PET, Pune

Source: (AJE India Pvt Ltd., Patalganga)

Caps, Labels, Syrup

All the caps, labels and syrup are coming from the Thailand Aje Group factory. As Indias
consumption of the brand are not more than Thailand and east counties. So they are not manufacturing
this labels, caps and syrup from here.
As syrup is an important part of the beverage industry. So, they make it in a secret way and its
composition is not revealing to anyone.

Figure 3.3 Caps for use

Figure 3.4 Labels are ready to use

Figure 3.5 Syrup in Store room

Figure 3.6 Renuka Sugar

Source: (AJE India Pvt Ltd., Patalganga)

Sugar: - Company is using JIT for buying sugar. They are buying sugar from Renuka Sugars.
Water:- The government water through pipe supply is stored in a tank and the water
treatment process is done to further purify it.
NH3 and CO2:- Local Mumbai chemical suppliers are supply them the required amount in
time to time basis according to the requirement of the plant.
Benefits of buying from local vendors
1.
2.
3.
4.
5.

Implementation of JIT.
Reducing cost of purchase.
Less Inventory place required.
Reduce labour cost.
Reduce technical headaches and can give more focus on marketing and expansion of the
business.

Economic order quantity (EOQ) is the order quantity that minimizes total inventory
holding costs and ordering costs.. The framework used to determine this order quantity is also
known as Wilson EOQ Model or Wilson Formula. The model was developed by Ford W.
Harris in 1913.
Figure 3.7 EOQ Model

Source: (flylib.com, 2012)

For calculation of EOQ we need A, Cp, Ch.

Where
A = Demand for the year.
Cp = Cost to place a single order.
Ch = Cost to hold one unit inventory for a year.

Now EOQ=

To reduce EOQ the organisation should focus on reducing holding cost by applying JIT.

Six Sigma
Six sigma is a measurement based strategy which is directed towards the production process
improvement and to reduce the uncertainty of process failure risk. Many predefined structure
exist for its implementation. Consultant develops proprietary methodology to implement six
sigma. There are two variant in six sigma.
1) DMAIC (Define, Measure, Analyse, Improve, Control)
2) DMADV (Define, Measure, Analyse, Design, Verify)
One key innovation of Six Sigma involves the absolute "professionalizing" of quality
management functions. Prior to Six Sigma, quality management in practice was largely
relegated to the production floor and to statisticians in a separate quality department. Formal
Six Sigma programs adopt a kind of elite ranking terminology (similar to some martial arts
systems, like Kung-Fu and Judo) to define a hierarchy (and special career path) that includes
all business functions and levels.
Figure 3.8 DMAIC (Six Sigma)

Source: http://www.coe-partners.com/six-sigma-and-innovation/
Figure 3.9 DMADV (SixSigma)

Source: http://www.nevilleclarke.com/content.php?id=76&cid=17

JIT
Just in time theory is process in which the user of JIT achieve high volume production using
minimal inventories. In this process the inventory arrives at the time of requirement so that
the cost occurring to store and maintenance can be reduced. To meet JIT objectives, the
process relies on signals or Kanban between different points, which are involved in the
process, which tell production when to make the next part or to supply the next part of
inventory.
The supplier is responsible for storing the inventory.
Figure 3.10 Benefits of JIT

Implementation of JIT by AJE INDIA

The company is getting all the above benefits by applying jit. But it is restricted to apply this
towards sugar supply, water supply, 70% preform supply, Ammonia supply, and co2 supply.
Fail to apply JIT
The company is buying 3o% of its preform from Thailand. All caps, syrups, labelling are also
coming from Thailand where the lead time is more than 45 days and also distance is very
much and the organisation is dependent on the shipments (water root). So it is difficult for the
company to fully depend on JIT and they have a stock room for their inventories.

The main success factor for a beverage industry is the quality of the beverage. Here in the
AJE group the companys main focus is the quality for that reason they have a single
manufacturing unit in entire India. As the place changes the taste of the water also changes
which may lead to variation in taste. The company is using the government supply water
which is already treated and inside the factory in patalganga they have another water
treatment plant which assures the purification of the water.

Figure 4.1 TQC process in AJE group

Syrup

TQC / Lab testing

Pass

PTE
Pass

Packaging

Filling

Labelling
Pass

Pass

Ready to dispatch/
Waiting in Warehouse
Pass

TQC
Fail

Rejected and collected as garbage

The company does not use caffeine in its soft drinks. Caffeine is a psychological stimulant or
psychoactive drug. All the other beverage companies are using the caffeine whereas the AJE
group does not use it which is an advantage for the company to have a difference in Indian
market and to bring good position in the customers mind.
Quality check of syrup is done in laboratory before the filling process.

Quality Certifications by AJE India pvt. Ltd.

ISO 9001:2008
ISO 22000:2005
FSSC 22000

Tools and techniques required to meet Demand with control over Packaging
and SCM
From the interview of the AJE India Product manager it has been found that the company is
using forecast pro for the purpose of forecasting and controlling the SCM.

Forecast Pro
It is a comprehensive forecasting and forecast management system. This is very affordable
and easy-to-use solution that gives AJE India pvt ltd the capability to create accurate and
credible forecasts, along with the tools for efficiently managing, monitoring and improving
the forecast process.
Forecast pro has been formally integrated into several commerciallyavailable Partner
Solutionsincluding ERP, DP, SCM and other systems after being deemed to be the best of
breed after intensive evaluation. (Products: Forecast Pro Overview, 2014)
Features of forecast pro from the website (http://forecastpro.com)
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.

Create Accurate Forecasts Automatically

View Your Forecasts Any Way You Wish
Work With Multiple Hierarchies
Manage and Review Forecasts Effectively
Monitor You Forecast Performance
Manage By Exception
Consolidate Your Team's Forecasts
Work with any information you need
Lock in Specific Forecasts
Maintain Your Forecasts
Integrate Smoothly with Other Systems

Figure 4.2 A view of Forecast pro

Source: http://forecastpro.com/products/overview/features.htm

Warehousing and Logistical Operations

The company produces according to the demand. The company supplies all their products
from patalganga to other parts of the country. From the visit of the researcher it has been
found the company has only 5 trucks for their own operation and to supply for the retail
stores and hub stores near patalaganga. The company uses Third party logistics for the supply
of the beverage throughout their deport in entire india.
The warehouse normally holds the 10% of total production of any day. But in rare or worst
condition it can be stretch to hold 7 days old stock and in at that period the production will
stop.
The company has 12 warehouses in entire India including the plant.
Place

ORO Brand presence in warehouse

(in %)
8
Andheri
4
Bhandup
8
Chembur
5
Dahisar
8
Thane
5
Kamothe
4
Nashik
18
Surat
4
Baroda
9
Tathawade
9
Wagholi
10
Plant

BIG cola Brand presence in warehouse

(in %)
10
7
10
6
7
4
4
10
15
5
5
10

Figure 4.3 Raw materials in the warehouse waiting for utilization

Figure 4.4 Finished beverages in warehouse waiting for logistics

Figure 4.5 Finished beverages in warehouse waiting for logistics

Source: (AJE India Pvt.Ltd., Patalganga)

Figure 5.1 The FA

Conclusion
A family owned business of Peru has been created a grand success
story ever in this century in beverage industry within 28 years.
It manages 17 trademarks in 48 different presentations of PET
and glass bottles, and also cans.
The company has a brand association with English Football
Association(The FA) which also making it familiar with Europe
market and giving push to its brand name.

Source: http://worldsoccertalk.com

AJE group is the fifth biggest soft drinks company in Latin America and ranked 21 of all soft
drinks makers in entire global. Its sales are about $2bn worldwide. From the research it has
been found that the sales have grown up to 22 per cent from the year 2000 to 2013, but AJE
group has to go a long way to occupy the soft drink market as their market share is only 0.4
per cent globally whereas its competitors market shares are much more higher like Coke has
25 per cent market share and Pepsi has the market share of 10.7 per cent.
The company has a great potential in a country like India where the dispensary cost of an
average Indian is low compare to other developed and developing countries. Indias rural
market is yet open to penetrate. Pepsi and coca cola have their own war in advertising sector
and spending money like anything to promote their brand that creates a sweet spot for the
company like AJE India or Big cola brand to penetrate the rural market by considering its
lower price compare to both Pepsi and coca cola.
A combination of a low-cost strategy, clever marketing and relentless focus on emerging
markets has helped this little-known company take on Coke and Pepsi, the global soft drink
giants, in Latin America and Asia. (Bland and Schipani, 2014)
The company has a brand association with England football league which also making it
familiar with Europe market and giving push to its brand name.
Brands success is not only due to lower cost but due to adopting local markets. In Asia the brand is
selling big cola without caffeine, to adopt the local market needs and also at the time of crisis of the
economy in Indonesia, it launched a 300 ml pack priced at 2000 Rupiah to remain attractive to its target consumers. Now within few years AJE holds 40% of the Indonesian soft drink market of 1 billion
litres per annum!
In India they are focusing on bottom of the pyramid approach where the focusing lower and middle
class group giving the product in cheaper rate and spending less in advertisement to decrease the
marketing expenditure. It is focusing on the direct partnership rather than whole sale which can easily
understood by the fact that their 92% sales are coming from direct partnership and only 8% through
wholesale partnership.

Recommendation
I.
II.
III.

IV.
V.
VI.

VII.

The company is exporting labels, syrups, caps and 30% preforms. So, it should buy
these from India to reduce cost and to get in time.
Companys 3 litre bottles design is not good and those are difficult to carry. So, they
must change the bottle design for 3 litres.
Company has less market penetration but it is using 3 rd part logistics for supplying the
goods to the warehouses in entire India. The company is paying double root (both up
and down) price where their work is to supply the material. Hence they can use
railways to supply the goods to a long distance.
Use of JIT in entire process will help the company to reduce cost and to have a greater
space for the finished product.
Syndicate marketing and Satellite marketing can improve its market situation.
Company has only one plant in entire India. So, company should focus on expanding
the business by manufacturing more in a new plant establishing in eastern part of
India.
The company should use underground water to reduce the dependency of the supply
water which is creating some problems during summer season.

VIII.
IX.

Company should use some brand association in India mainly with popular food stalls.
So, that brand awareness will be more.
The company can use IMC campaign to improve their presence.

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