PepsiCo, like other companies have their sustainable and competitive advantages, and are judged on their SWOT analysis. I will discuss how PepsiCo does in these areas and how they plan on improving some as well. PepsiCo states that there are three main sustainable advantages that give them a competitive edge as they compete globally with other companies. One, their big muscular brands, two, proven ability to innovate and create differentiated products, and third, powerful go-to market systems (“Overview” ).
The picture shown below is the same one shown on their website showing the cycle in which the company operates (“Overview” ). The company’s website also tells how the brands are over one hundred years old, yet the corporation is relatively young (“Overview” ). PepsiCo was formed when Pepsi-Cola and Frito-Lay merged in 1965 (“Overview” ).
In 1998, Tropicana was added to PepsiCo. (“Overview” ). Followed by that merge was the Quaker Oats Company and Gatorade in 2001 giving the company a sorted variety of beverage lines (“Overview” ). With all of the company’s merged into one corporation, PepsiCo has acquired products that are well brands, therefore enforcing their muscular brands as an advantage.
I believe that one of PepsiCo’s biggest competitors is the Coca-Cola company, speaking purely on beverages. Even in my own personal experiences I have found myself having to choose between Pepsi and Coke (for what I deem to be their most popular soft-drinks). But, PepsiCo has various products from foods to beverages and the Coca Cola company only offers beverages. One of the things PepsiCo tells on their website is that they reinvest money back into their own new products and the company also invests in building the brands that the corporation already produces (“Overview” ).
PepsiCo’s third advantage, as shown in the diagram above, is their powerful go-to market systems (“Overview” ). This advantage can be seen to be enforced through PepsiCo’s mission that begins with “To be the world’s premier consumer products company focused on convenient foods and beverages…” (“Overview” ). Through advertisement, involvement in communities and non-profit organizations, and positive Earth-friendly motives, PepsiCo proves that this advantage is being used in various ways to positively reflect the company globally.
To analyze PepsiCo’s SWOT analysis, I will begin with the letter S, strengths. However, before I do begin, I do want to point out that I compared it with another author by the name of Jojo Brady, and therefore I was able to verify that these were true, as it was not only evident to one person, but another as well “”(Brady , 2010). One of the corporations strengths is their branding, not only for their globally known Pepsi beverage but other beverages and foods such as Gatorade, Lays potato chips, Tostitos chips, and Doritos chips, just to name a few (“Swot analysis pepsico,” 2012).
Being said, these products are in over two hundred countries and showing economic sales (“Swot analysis pepsico,” 2012). A second strength is diversification. PepsiCo has over 18 brands and each brand brings in $1,000 million in sales (“Swot analysis pepsico,” 2012). The company does not limit itself to soft drinks, but also ready to drink teas, juices, bottled water, and cake mixes (“Swot analysis pepsico,” 2012). And finally, their distribution. PepsiCo delivers their products from either warehouses or plants to customer warehouses or other retail locations (“Swot analysis pepsico,” 2012).
Next we move on to the letter W for weakness. One of the weaknesses is the overdependence on Wal-Mart and U. S. Markets (“Swot analysis pepsico,” 2012). 12% of the companies revenue depends on Wal-Mart, also considering that Wal-Mart is one of PepsiCo‘s largest customers (“Swot analysis pepsico,” 2012). PepsiCo also depends heavily in the U. S. (“Swot analysis pepsico,” 2012). The company holds 52% of its revenue here in the U. S. and is vulnerable to any economic change that the U. S. may incur (“Swot analysis pepsico,” 2012).
In 2007 and 2008, damage was done to PepsiCo hurting the companies name trust to consumers (“Swot analysis pepsico,” 2012). PepsiCo, had an incident with exploding Diet Pepsi cans in 2007, and only a year later had to pull their Aunt Jemima products due to a salmonella contamination in 2008 (“Swot analysis pepsico,” 2012). Things like this hurt the company to a large vulnerability in losing customers and putting most of their economic revenue in the U. S. Even though PepsiCo may have some weaknesses, there are also plenty of opportunities present in the company.
On of the opportunities is PepsiCo’s attempt to acquire Russia’s leading juice company, Lebedyansky, and the United Kingdoms V Wwater (“Swot analysis pepsico,” 2012). This attacks one of their main weakness and once the company has obtained these companies, their overdependence on the U. S. will drop (“Swot analysis pepsico,” 2012). However, this is not the only way that PepsiCo plans on dropping their overdependence in the U. S. as there is a current investment pending in India of $500 million, and $1,000 million in China (“Swot analysis pepsico,” 2012).
Talk of Brazil and Mexico are potential future investments. Finally, we reach the threats that PepsiCo faces. PepsiCo, like other soft drinks, is expected to decline in sales (“Swot analysis pepsico,” 2012). Another risk that runs Is the potential risk of losing customers due to government regulations (“Swot analysis pepsico,” 2012). And lastly, we can look at the intense competition PepsiCo has; yes primarily Coca-Cola (“Swot analysis pepsico,” 2012). Even though Coca Cola may be one of PepsiCo’s toughest competitors, but PepsiCo is aware (“Swot analysis pepsico,” 2012).
Even though the company may run risks like these, it still manages to remain positive in the stocks for their investors “”(“Pepsico,” 2011). While I was not able to find any employment demographic information, I did note that the company has some U. S. business as well as foreign. However, from the analysis I have concluded prior to this I can safely assume that most of the company’s employee’s are here in the U. S. PepsiCo competes well in the market of food and beverages. They are also oing what they can to fix any flaws they may have, which shows how effectively the company runs.
Bibliography
- “Overview . (n. d. ). Retrieved from http://www. pepsicocareer. com. vn/en/jobseekers/news/cate/35A4EDA1
- “Swot analysis pepsico. (2012). Retrieved from http://www. marketingteacher. com/swot/pepsi-swot. html
- “Pepsico. (2011). Retrieved from http://www. pepsico. com/index. html
- “Brady , J. (2010, July 23). My pepsico swot analysis. Retrieved from http://jdbrady. wordpress. com/2010/07/23/my-pepsico-swot-analysis/
