PepsiCo Industry Analysis

PepsiCo is an America multinational food and beverage provider specializing in the manufacture, marketing and distribution of grain-based snack foods, beverages and many other products. It was founded in 1965 after a merger of the Pepsi-Cola Company and Frito-Lay, Inc.  PepsiCo has expanded with time to enjoy great investments in the business. For instance, it acquired Tropicana in 1998 and added the Gatorade brand after the Quaker Oats in 2001.

With rapid growth over the years, PepsiCo has been ranked among huge revenue contributors on the global platform. Evidently, as of 2012, it’s widely acknowledged brands generated retails of more than $1 billion each. The company distributes its products across more than 200 countries and this pushed the annual net revenue of about $43.3 billion within the same economic year.

Interestingly, PepsiCo has been ranked as the second largest beverage and food business in the globe.  Indra Krishnamurthy Nooyi is the CEO of PepsiCo and has been able to see creation of more than 274000 job opportunities worldwide. Being the most proactive and progressive company in the world, PepsiCo has been able to rely on the best marketing and advertising campaigns to meet the demands of the huge clientele base. Its great management and marketing plan has seen more than $2 billion spend on advertising in 2012. This has made it easy for PepsiCo to enjoy a rapidly growing market share over its central rivals.

The macro environment of PepsiCo has been an interesting one. There are numerous political factors that have impacted its operations in the competitive beverage and food industry. Federal and international laws by FDA, EPA and OSHA have impacted soft drink company operations worldwide.  PepsiCo has been a victim of political environmental forces in a number of occasions. For instance, the Centre of Science and environment [CSE] based in India accused PepsiCo and a number of soft drink companies of offering beverages with high pesticide content and their drinks where banned in some parts of India more so in state of Kerala. A public health initiative, the US the soda tax was introduced to levy syrup and sugar-sweetened drinks.

The financial crisis of 2008 and 2009 had great impact on soft drink industry where PepsiCo is a major stakeholder. About $55 billion was lost in the industry and the sale of packaged products reduced drastically. PepsiCo was forced to invest on low borrowing rates in all its operations and new product development.  Due to the high demand for healthy food and beverages has made it easy for PepsiCo to introduce new products like Diet Pepsi, Caffeine free Pepsi and Pepsi Natural that have been core preference for different social classes in the market.

PepsiCo has always relied on technology to carry on its operations and satisfy the needs of its large clientele base. Through Direct Store Delivery [DSD] a technologically advanced distribution system has made it easy for the company to supply retailers with fresh stocks without any complications. Building a great information technology infrastructure has made it easy for the company to improve communication flow and efficiently excel in its corporation operations.

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