Question

The political environment in India has proven to be critical to company performance for both PepsiCo and Coca-Cola India. What specifi c aspects of the political environment have played key roles?

Answer 1

Answer:

Explanation:

The political environment in India have played key role in company performance of PepsiCo and Coca-Cola India as follow:

- The Indian government viewed as unfriendly to foreign investors especially those who want to invest in other sectors apart from high tech sectors.

- Outside investment had been allowed only in high-tech sectors and was almost entirely prohibited in consumer goods sectors. The The “Principle of Indigenous Availability” (Policy banning imports being sold in India)

- Distribution Arrangements - Production plants and bottling centers were strategically placed in large cities all around India. They were more added as demand grew, along with new product lines. In Coca-Cola’s case, the JV with Parle provided access to its bottling plants and its products. By forming partnerships, both Coca-Cola and Pepsi were able to get initial access into the market.