Pepsico's Strategy

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Table of Contents
Vision Statement0
Mission Statement1
Company Profile1
External Analysis2
What are the industries dominant features?2
How strong are competitive forces?4
What forces are driving industry change and what impacts will they have?4
What market positions do rivals occupy – who is strongly positioned and who is not?5
What strategic moves are rivals likely to make?5
What the key factors for future competitive success?5
Does the outlook for the industry offer the company a good opportunity to earn attractive profits?5
Internal Analysis6
SWOT (strengths, weaknesses, opportunities, threats)6
Value Chain7
Financial Analysis9

PepsiCo Inc.

Company Profile
PepsiCo Inc. was established in 1965, merged between the salty snack icon and soft drink giant by PepsiCo and Frito-Lay shareholders. The new company was founded with annual revenues of $510 million. PepsiCo was the world's largest snack and beverage company, with 2007 net revenues of approximately $39.5 billion. The company's portfolio of business in 2008 included Frito-Lay salty snacks, Quaker Chewy granola bars, Pepsi soft drink products, Tropicana orange juice, Lipton Brisk tea, Gatorade, Propel, SoBe, Quaker Oatmeal, Cap'n Crunch, Aquafina, Rice-A-Roni, Aunt Jemima pancake mix, and many other regularly consumed product. Through 2007, the company's top managers were focused on sustaining the impressive performance that had been achieved since its restructuring through strategies keyed to product innovation, close relationships with distribution allies, international expansion, and strategic acquisitions. Issues

Although the company held large market shares in many international markets for beverages and salty snacks, it had been relatively unsuccessful in making Quaker branded products available outside the USA. This is a major concern of PepsiCo executives as well as shareholders. The next most important issue are that PepsiCo's international operations are much less profitable than its business operating in North America. These two issues are of concern considering there are vast opportunities in the international markets. Internationally, snack food volume grew by nine percent alone and beverage by eight percent; these are impressive figures. New organizational structure development has also begun in 2008 with the restructuring of their businesses. They have moved from the traditional four-division structure to a three-division structure with six reporting segments. Organizational changes on a magnitude of this scale require adequate planning and resources. Vision Statement

“PepsiCo's responsibility is to continually improve all aspects of the world in which we operate - environment, social, economic - creating a better tomorrow than today.” The vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company. These programs are called the “Power of One” strategy and “Innovation Summits” which will be discussed in the Value Chain analysis of the report. Mission Statement

The mission is to be the world's premier consumer products company focused on convenient foods and beverages. We seek to produce financial rewards to investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity. Objectives

PepsiCo is a well-diversified organization with many different product lines and ways to improve those product lines. Since 2008, they have focussed on new product innovations that addressed consumer health and wellness concerns. Their chief managers expected that the company’s line-up of snack, beverage and grocery items will generate sufficient operating cash flows to reinvest,...
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