Pepsico pepsico 1. Introduction: 1 What is PEPSICO? 1 Brief History of PEPSICO 1 Business Segments 1 Frito-Lay 1 Pepsi-Cola Company 2 Tropicana 3 2. Company Analysis: 4 External Analysis 4 PEST Analysis: 4 Porters Diamond: 5 Five Forces 8 Internal Analysis 9 Porters Value Chain 9 Boston Consulting Group 12 Financial Analysis 13 SWOT 14 Strength 14 Weakness 14 Opportunities 14 Threats 15 3. Conclusions 15 Marketing 15 General 15 4. Recommendations 16 Bibliography 17 Appendix 17 Appendix I 17 Appendix II 17 Appendix III 17 Appendix IV 17 Appendix V 17 Appendix VI 17 1.
Introduction: What is PEPSICO? PepsiCo is one of the most successful beverage and snack food business in the world. The company consist of: Frito Lay Co., Pepsi-Cola Co., and Tropicana Products. Brief History of PEPSICO PepsiCo was funded in 1965 by Donald M. Kendall Pepsi-Cola president, and Herman W. Lay, president of Frito-Lay.
Caleb Bradham, a New Bern, N.C. pharmacist, created pepsi-Cola in 1890. Frito-Lay, Inc. was formed by the 1961 merger of the Frito Company, founded by Elmer Doolin in 1932, and the H. W. Lay Company, founded by Herman W.
Lay, also in 1932. In 1998 PepsiCo acquires Tropicana Products from Seagram Company Ltd. Anthony Rossi founded Tropicana in 1947. Business Segments Frito-Lay Frito-Lay, Inc was funded in 1961, by merging of The Frito Company and H.W. Lay Company. Today, Frito-Lay brands account for 40% of the world, snack chip industry, and 56% of the U.S. industry.
Often, Frito-Lay Company products are known by local names (Matutano in Spain, Walkers in the United Kingdom and others.) Major Frito-Lay Company products: – Lay’s Potato Chips – Baked Lay’s Potato Chips – Ruffles Potato Chips – Doritos Tortilla Chips – Tostitos Tortilla Chips – Baked Tostitos – Santitas Tortilla Chips – Fritos Corn Chips – Cheetos Cheese Flavoured Snacks – Rold Gold Pretzels – Funyons Onion Flavoured Rings – Sun chips Multigrain Snacks – Cracker Jacks – Chester’s Popcorn – Grandma’s Cookies – Munchos Potato Chips – Smart food Popcorn – Baken-ets Fried Pork Skins – Frito-Lay Dips & Salsa – Sabritas Potato Chips – 3D’s – Smiths Potato Crisps – Walkers Potato Crisps Pepsi-Cola Company Caleb Bradham founded pepsi-Cola in 1890. Brand Pepsi and other Pepsi-Cola products account for nearly one-third of total soft drink sales in the United States, a consumer market totalling about $58 billion. Outside the United States, Pepsi-Cola beverages are available in about 160 countries. Today Pepsi-Cola products account for about a quarter of all soft drinks sold internationally. The company has also established operations in the emerging markets of the Czech Republic, Hungary, Poland, Slovakia and Russia, where Pepsi-Cola was the first U.S. consumer product to be marketed. Pepsi-Cola provides advertising, marketing, sales and promotional support to Pepsi-Cola bottlers and food service customers. This includes some of the world’s best and most recognized advertising.
New advertising and exciting promotions keep Pepsi-Cola brands young. Pepsi-Cola Company products: – Pepsi-Cola – Diet Pepsi – Pepsi One – Mountain Dew – Slice – Mug Root Beer – Mug Crme – All Sport – Lipton Teas (Partnership) – Aquafina Water – Frappuccino Coffee Drink – Mirinda – 7UP (outside the U.S. only) – Fruit Works – Pepsi Max Tropicana Anthony Rossi founded Tropicana in 1947. The company entered the concentrate orange juice business in 1949, registering Tropicana as a trademark. In 1954 Rossi pioneered a pasteurisation process for orange juice. For the first time, consumers could enjoy the taste of pure not-from-concentrate 100% Florida orange juice in a ready-to-serve package.
The company went public in 1957, was purchased by Beatrice Foods Co. in 1978, acquired by Kohlberg Kravis & Roberts in 1986 and sold to The Seagram Company Ltd. in 1988. Seagram purchased the Dole global juice business in 1995. PepsiCo acquired Tropicana, including the Dole juice business, in August 1998.
Today, Tropicana is the world’s largest marketer and producer of branded juices with products available in 50 countries worldwide. Tropicana products: – Tropicana Pure Premium – Tropicana Season’s Best – Dole Juices – Tropicana Twister. – Hitchcock – Looza – Copella. 2. Company Analysis: External Analysis PEST Analysis: The Pest Analysis identifies the political, economical, social a technological influences on an organization. Political influences: – The production distribution and use of many of PepsiCo product are subject to various federal laws, such as the Food, Drug and Cosmetic Act, the Occupational Safety and Health Act ad the Americans with Disabilities.
– The businesses are also subject to state, local and foreign laws. – The international businesses are subject to the Government stability in the countries where PepsiCo is trying get into (underdeveloped markets). – The federal, state, local and foreign environmental laws and regulations. – The businesses are also subject to de taxation policy in each country they are operating. – They also have to comply with federal, state, local and foreign environmental laws and regulations. Economic influences: – The companies are subject to the harvest of the raw material that they use in their snack foods, soft drink and juice, like corn, oranges, grapefruit, vegetables, potatoes, etc.
– Because of they rely on trucks to move and distribute many of their products, fuel is also an important subject, so they are subject to the fuel prize fluctuation, and to possible fuel crisis. – Operating in International Markets involves exposure to volatile movements in foreign exchange rates. The economic impact of foreign exchange rates movements on them is complex because such changes are often linked to variability in real growth, inflation, interest rates, governmental actions and other factors. – PepsiCo is also subject to other economical factors like money supply, energy availability and cost, business cycles, etc. Sociocultural influences: – PepsiCo and moreover Pepsi is subject to the lifestyle changes, because of it bases her advertising campaigns in a concrete kind of people with an special lifestyle, it is for that PepsiCo has to pay a special attention on the lifestyle changes. – Particularly in the United States Pepsi drinkers are very defined, there is a kind of people who drinks Pepsi another kind who drinks Coca-Cola, it is for that they have to pay attention to the social mobility for not losing a possible market. – Taking into account that PepsiCo is trying to introduce itself in underdeveloped markets, they have to be careful with the possible problems with the governments of this countries, and with the problems could rise from PepsiCo act with the people of this countries.
Technological influences: – PepsiCo is subject to new techniques of manufacturing, for their three business sectors, snack food, juices and soft drinks. – It has to pay attention to the new distribution techniques. – And they have to fix their attention in the competence developed, to know about the new products. Porters Diamond: The Porters Diamond Analysis tries to explain the Competitive Advantage of Nations. There are four attributes of a nation comprise Porters Diamond of national advantage, they are: Factor Conditions: The basic factor conditions are natural.