Food & Beverages

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Once upon a time strategic discussions between Indian and Global teams of beverage giants Coca-Cola and PepsiCo was mostly about their opponents. But the scenario has undergone huge change these days. The growing reach of small and local brands in the beverage industry is the matter of their discussions.

A look at some of the rising stars in the beverage industry

Some rising stars in this industry are Gujarat based Hajoori & Sons, Alwar’s Jayanti Beverages, City Cola from Delhi, Bareilly based Boss Beverages and Delhi Based Shri Brahm Shakti Prince Beverages. They are stealing the sale volume silently from these two multinational beverage giants by offering the customers with products costing about 20% less at the same time retaining the quality. This has successfully worked out in rural areas and small towns.

These brands together have managed capturing about 10 % of the Rs 14,000-crore aerated drinks industry in India, said an official working with CocaCola. Also they are taking control of the aerated drinks market at a fast pace said researchers.

Sosyo owner Hajoori & Sons claims it has at least 29 per cent share in the state of Gujarat whereas in Uttar Pradesh some small brands have taken up about 22 percent share in summer 2018. Kailash Keswani, the director of Shri Brahm Shakti Prince Beverages, said, "Coke and Pepsi spend crores on advertising, but our quality is better. We put real lemon in our lemon drink and consumers like that. We also sell at lower prices."  According to veterans from the beverage industry, these two giants are paying the price of what they should have taken care years ago since companies which entered the beverage market as bubbles are growing at a faster rate.

In the words of Industry experts

 

Industry experts opine that tough competition from these local brands altogether forced PepsiCo and Coca-Cola to drop the price of coke in the glass bottles measuring 200 ml to INR 10 instead of INR 12 in major markets like Uttar Pradesh. They are also giving lump-sum offers on 2L PET bottles so as to keep their market shares safe. But they are still not able to match the local rivals. AAP cola which is selling 250ml PET bottles at Rs. 10. "The global brands can’t afford to drop prices beyond a point. They have to show profitability too to their parent firms," the official said. Most local brands are trying to expand their reach with few aiming to take up the national status this year.

As of Hajoori & Sons owning the Sosyo brand is already offering Ginlim Lime, Kashmira Jeera Masala sola, Lemee Orange and lime in states of Maharashtra, Madhya Pradesh and Rajasthan. Also it is expecting to extend its link to Hyderabad soon. Not to be overlooked, these brands are also somewhat playing with their Indian customers with tactful use of themes like ‘Apna Desh, Apna Drink’, ‘Be Indian, Buy Indian’. AAP cola got noticed in February when it was distributed free at Aam Aadmi Party leader Arvind Kejriwal’s swearing in ceremony. The Keshwani family which is its promoter owe its origin in a small paan shop named Prince Paan shop in the capital city New Delhi since 1960s.

Wrapping Up

Industry insiders even stated that cricket maestro like Virender Sehwag and his’ family is making  investment in the beverage industry. All in all, it can be rightly said that there is tough competition waiting for PepsiCo and CocaCola Inc. in the near future.