You are an Investment Analyst
ACC557 – Financial Accounting
Professor Levi Beckwith
March 16, 2014
1. Analyze each company’s history, product/services, major customers, major suppliers, and leadership and provide a synopsis of each company. The Coca-Cola (NYSE: KO ) vs. PepsiCo (NYSE: PEP ) war is one of the greatest rivalries in corporate history, just like Apple vs. Microsoft. Coca-Cola and Pepsi are the two most popular and widely recognized beverage brands in the world. They have been competing in the soft drink sector for over a century and both companies enjoy a high degree of brand consciousness globally. Both companies try to market as part of a lifestyle. At the same time, these two soda giants are among the most popular and respected dividend growth companies in the market, so let's take a look at the Coke vs. Pepsi debate from an investor's perspective. Coca-Cola uses phrases such as “Coke side of life” in their website, while Pepsi uses phrases such as “Hot stuff” in their web, to promote the idea that Pepsi is “in sync” with the cool side of life. Ironically, both Pepsi and Coke have similar beginnings: both were created in the 19th century and both were the results of the experimental work of innovative pharmacists. Coke was created in 1886 by Atlanta pharmacist John Pemberton while Pepsi was developed in 1898 by North Carolina pharmacist and drugstore owner, Caleb Bradham. The history of Pepsi began with a man named Caleb Davis Bradham. He was born in Chinquapin, North Carolina on May 27, 1867. He graduated from the University of North Carolina at Chapel Hill and attended the University of Maryland, School of Medicine, around 1890. After returning to North Carolina, Mr. Bradham taught public school for about a year, and later opened a drug store on the corner of Middle and Pollock Streets in downtown New Bern. In 1902, Bradham launched the Pepsi-Cola Company in the back room of his pharmacy and on December 24, 1902 the Pepsi-Cola Company was incorporated in the state of North Carolina. The business began to grow, and on June 16, 1903, "Pepsi-Cola" was officially registered with the U.S. Patent Office. In 1910 there were 250 Pepsi-Cola franchises in 24 states and in January of that year the Pepsi Cola Company held their first Bottler Convention in New Bern. In 1926, Pepsi received its first logo redesign since the original design of 1905. In 1929, the logo was changed again. In 1931, at the depth of the Great Depression, the Pepsi-Cola Company entered bankruptcy. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Megargel was unsuccessful, and soon Pepsi's assets were purchased by Charles Guth, the President of Loft, Inc. Today PepsiCo, Inc. (PepsiCo) is a global food and beverage company. Through the Company's bottlers, contract manufacturers and other partners, the Company makes, markets, sells and distributes a range of foods and beverages in more than 200 countries and territories. PepsiCo is organized into four business units: PepsiCo Americas Foods (PAF), which includes Frito-Lay North America (FLNA), Quaker Foods North America (QFNA) and all of its Latin American food and snack businesses (LAF); PepsiCo Americas Beverages (PAB), which includes all of its North American and Latin American beverage businesses; PepsiCo Europe, which includes all beverage, food and snack businesses in Europe and South Africa, and PepsiCo Asia, Middle East and Africa (AMEA), which includes all beverage, food and snack businesses in AMEA, excluding South Africa. In 2011 the company had revenues of $66.504 billion and a net income of $6.462 billion. The company has around 29700 employees worldwide. PepsiCo is also listed on the NYSE and is also a part of the Dow Jones Industrial composite. Pepsi Co’s current chief executive is Indra Krishnamurthy Nooyi who has been at the helm since 2006. The history of Coca-Cola began with Col. John Pemberton. He...
References: 1. Bhasin, Kim (2012). Coca-Cola CEO Muhtar Kent Explains Why Everything 's All About Cash. Retrieved on March 14, 2014 http://www.businessinsider.com/coca-cola-ceo-muhtar-kents-leadership-philosophy-2012-5
2. Bradsher, Keith (2013). Worried About Land Grabs, Group Presses 3 Corporations to Disclose Sugar Purchases. Retrieved on March 12, 2014 http://www.nytimes.com/2013/10/02/business/3-corporations-pressed-to-disclose-data-on-sugar-purchases.html?ref=pepsicoinc&_r=0
3. Cardenal, Andres (2013) Better Buy: Coca-Cola vs. PepsiCo. Retrieved on March 12, 2014 http://www.fool.com/investing/general/2013/11/06/better-buy-coca-cola-vs-pepsico.aspx
4. -Cola (2013). Bloomberg Business Week. Retrieved on March 12, 2014 investing.businessweek.com/research/stocks/financials/ratios.asp?
5. “History of Pepsi vs. Coke Rivalry at Rivals4Ever”. Rivals4ever.com. Retrieved on March 14, 2014 http://rivals4ever.com/history-of-Pepsi-vs-Coke-Rivalry-5-3.htm
6. PepsiCo (2012) Our Products. Segmentation of Pepsi. (2013) scribd. www.scribd.com/.../Market-Segmentation-Positioning-and-Target-Marketing
7. Snyder, Steven (2013). Leadership Lessons from PepsiCo CEO, Indra Nooyi. Retrieved on March 11, 2014. http://www.snyderleadership.com/2013/05/07/leadership-lessons-from-pepsico-ceo-indra-nooyi/
8. Strom, Stephanie (2013). Pepsi Deal Underscores an Emphasis on Snacks. Retrieved on 3-15-2014 http://www.nytimes.com/2013/12/12/business/pepsi-deal-underscores-a-reliance-on- snacks.html?ref=pepsicoinc
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