Pepsico As A World Leader In Beverages Business Essay


PepsiCo was founded in 1965 by the merger of Pepsi-Cola and Frito- Lays. In 1998 Tropicana Company was acquired and PepsiCo after that make merger with The Company of Quaker Oats that includes Gatorade in year of 2001. That company has Frito-Lay, PepsiCo Beverages, and PepsiCo International. The brands of PepsiCo are available in about 200 countries and make sales of about $92 billion.

Mission of PepsiCo's is to be the world's higher consumer Products Company that focused on convenient foods and beverages. It seeks to produce healthy financial rewards to investors as they provide opportunities for making growth employees, partners of the business and the communities in which they are operate. In everything they do, they strive to act with honesty, fairness and integrity and to act upon the laws and general regulations of the countries where they business.

Pepsi-Cola is a beverage group that is established by PepsiCo. The brand was trademarked on

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There have been different variations in Pepsi production over the years since 1903,

including :

Diet Pepsi,

Crystal Pepsi,

Pepsi Twist,

Pepsi Max,

Pepsi Samba,

Pepsi Gold,

Pepsi Holiday Spice,

Pepsi Jazz

Pepsi X (available in Finland and Brazil),

Pepsi Next (available in Japan and South Korea),

Pepsi Raw,

Pepsi Retro in Mexico,

Pepsi One,

Pepsi Ice Cucumber in Japan.

Pepsi cola is lies in an Industry that is dominator by two major Competitors that are Coca Cola and of course themselves. As we know that Pepsi and Coke basically go after all customers that buy soft drink beverages Coca Cola targets it product at the head of household.

According to the beverage digest the customer base for soft drinks is whopping 95% of

regular user in United States. This represents the large number if potential customers for

Pepsi Cola.

The Pepsi's advertisements are referring to the markets that investees refer to as Generation X. The Generation X consumer lies between the ages of 18 to 29.They has high expectations in life and have very active life. They adopt a lifestyle of living for today and not worry about long term goal of future. They also have a focus on the 12 to 18 year old market

History of business:

PepsiCo is one of the world's top listed consumer product companies with many of the world's most valuable trademarks. Pepsi-Cola Company division is the 2nd largest soft drink business in the world, having 29 percent in the USA market. The Frito Lay Company is by far the world leader in salted snacks, grapping a 40 percent market share. The company's third division, Tropicana Products, is the world leader in juice drinks sales and holds a dominant about 41 percent of the USA chilled orange juice market. On the other hand, PepsiCo's portfolio includes about 16 brands. PepsiCo generate 35 percent of its sales just outside the United States and Pepsi-Cola brands marketed in round about 160 countries, Frito-Lay in more than 40, and Tropicana in approximately 50. When 2001 starts, PepsiCo adding to its food and drink the brands of the Quaker Oats Company, which include Gatorade sports drink, Quaker oatmeal, and Cap'n Crunch, Life, and other ready-to-eat cereals. (James Press, 2001)

Business starts and grows up:

Doc Bradham, like immeasurable other investors around the United States, was just trying to make a drink that is similar to Coca-Cola. In 1898, in New Bern and Bradham gives its name that is Pepsi-Cola.

"The drink after that known as Brad's Drink that is the newest cola beverage was syrup of sugar, vanilla, oils, cola nuts, and other flavorings mixed in carbonated water. The pharmacist followed Coca-Cola's method of selling the concentrate to soda fountains after that he make mixing the syrup in drugstore, and after that shipped it in bottles in form of barrels to the contracted operators who added in it the soda water. He makes to bottled and also sold the drink himself" (PepsiCo, Inc, 2001)

Doc Bradham in 1902 closed his store to in order to give his attention to the new business. In next year, he trademarks the Pepsi-Cola, make advertisement in a local paper, and make movement the bottling and syrup-making operations to a new custom-built factory. About 20,000 gallons of Pepsi-Cola syrup was make in 1904.

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"Pepsi-Cola's first bottling line resulted from some less-than-sophisticated engineering in the back room of Caleb's pharmacy. Building a strong franchise system was one of Caleb's greatest achievements. Local Pepsi-Cola bottlers, entrepreneurial in spirit and dedicated to the product's success, provided a sturdy foundation. They were the cornerstone of the Pepsi-Cola enterprise. By 1907, the new company was selling more than 100,000 gallons of syrup per year" (Andy's pepsiholic haven, 2011)

Bradham never recovered. After several attempts he wants to grow up, but only two of the plants remained open. At last effort, he achieves the help of Roy C. Megargel that was a Wall Street investment banker. Some people agreed to make investment in his business and it ruined. All assets sold and buy by Megargel.

Megargel reorganized his company as the National Pepsi-Cola in 1928, but just three years passed he faces continuous losses and ruined. 1933 ends and Guth buy out Megargel and owned the ownership of about 91 percent of the company. After that Guth make a decision to make improve sales.

Guth make changes to make internationalize Pepsi-Cola, making the Pepsi-Cola in 1934 and in the subsequent year form Pepsi-Cola de Cuba.

Current position:

"PepsiCo is the second largest food and Beverage Company in the world" (PepsiCo Inc, 2006) .It makes markets and sells it to a variety of salty and grain-based snacks and carbonated and non-carbonated beverages PepsiCo. In 2006, PepsiCo acquired Izze Beverage Company and StacysPita Chip Company that deals in Star Foods in Poland, and Bluebird Foodsin in New Zealand. It has made bigger its presence in the non carbonated drinks and also in snacks. The company's strengths by 5.5% in the year of 2006 compared with 2005. In the year of 2011, the company is planning to make expansion of its market share by further acquisition and doing joint ventures.



Large charge less bank note.

Good brands, better distribution, and more capabilities

Global bazaar baton in bite foods & non-carbonated beverages.

PepsiCo sold 3 articles by the administration source.

Big Budget of advertising.

Great Marketing Intelligence.

Research & Development.

Diverse and global awareness.

Make similar drinks - cheaper.


More Difficult to make affect Vision and Direction.

Having Highly Elastic Demand.

There is a Big Issues of health like Fat and Sugar.

Going Behind in All Markets, namely Russia, Venezuela, and South America.

Having great Health Issue in the Indian bazaar.

Due to its Large size leads to make conflicting interests

There is a Possibility of conflicts due to so many people,

There is losing of control and quality standards.


It makes Expansion of Food in the all markets.

Make Investment in carbonated articles in the US region.

There is a big market and growing market for the specialized foods for ethnic groups.

Differentiate name type of product and packaging available in its markets.

Sale can be increase by Internet promotion such as banner ads and keywords, and computerized manufacturing and processes can be increasing their efficiency.


PepsiCo competing with Domestic Standards.

The increases amount of awkward oil and raw materials affects the amount of accomplished products

Terrorism-Anti-American Advocates.

Computer breakdowns, viruses and hackers can reduce efficiency, and must constantly update products or other competitors will be more advanced.

Not entirely patentable, constant reliability by competitors.

Computer breakdowns, viruses and hackers can reduce efficiency, and must constantly update products or other competitors will be more advanced.

Strong Competition.

Potential Health Issues Free Trade.

PEST analysis:

A PEST analysis is one of them that are merely a framework that categorizes environmental influences as political, economic, social and technological forces.


PepsiCo products are subject to various laws especially federal laws.

Acquisition of land for new factories.

Government always focusing on stricter water pollution rules norms.

Raw Material prices are increasing that is a great worry.


There are new opportunities in other countries.

Price of fuel is continuously increasing.

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Labor Availability is a big problem.

Have a global economic perspective.


Issue of Replenishing of water.

New concept of partnership with farmers.

Issue of a solid waste management program.

Bigger impact on youngsters.


PepsiCo Operates in almost all the countries.

There is a introduction of cans and plastic bottles.

Introduction of newer and attractive Designs.

State-of-the-Art plants.

Strategic analysis:

Pepsi-Cola was made in 1898 and go further by following the Coca- Cola's marketing strategies, product strategies, and also distribution strategies. PepsiCo make advertisements heavily as finances are permitted to it, and after that distributed through channels of soda fountains and franchised bottlers.

By viewing Pepsi's marketing strategies; we find that Pepsi made so many right choices. Although keep in mind the existence of Coke, Pepsi can never lie down. As we know that It is not as much unique. So, Pepsi took advantage of their late entry into the market by lowering their prices. Before it entered the multinational market, first of all make familiarity to its customers with its product thoroughly home base. After some time Pepsi make it ready to enter the international market, it really know what the requirements of it customers (strategic analysis: pepsi-cola company, 2009)

Pepsi's marketing strategies, from past to present included: make enhancement to distribution system, make familiar to the foreign market environment and find all things that their buyers likes in common, moreover by adding new and technological innovations and products and make also improve its new products, use powerful advertising, use of technology, make people socially-aware, mergers with major companies and make expend into other industries like restaurants. As we know that cock is a competitor of Pepsi so When Coke makes a marketing move they waiting for Pepsi's response. So Coca-Cola's familiarity also rubbed off on its rival.


Pepsi Co is currently a strong worldwide leader in the food and beverage industry.

Throughout its growth, it has stayed true to its mission and objectives, while becoming a

dominant force within the United States as well as abroad. Known throughout the world

for quality products and customer care, Pepsi Co should make no major strategic changes

to its plan. However, like in any business situation there are areas that Pepsi Co can

improve upon. Some of the recommendations are as follows:

Continue to expand with their "Human Sustainability". The healthy eating

market is a demographic that will continue to grow in the future, and will

provide generous profits if Pepsi Co is able to obtain a large market share.

Expand more into social benefits, especially for those in developing nations.

Pepsi's main competitor Coca Cola has implemented a water purification

Program for African Villages, which provides a valuable need and at the same time introducing their brand name where it was before unknown. If Pepsi followed this same ideology with food products and water purification it too would significantly increase brand recognition

Capture more of the aging population's market share. Pepsi is a company that is

focused on a youngsters market hoping to make the worldwide success of Coca

Cola in order to make brand loyalty with the generations born after the year 1980;

however, there is still a large market with the Baby boomer demographic that

they could break into.( Pepsi Co Strategic Management, 2008)

A minor yet still important change that needs to be made is to their website.


Overall PepsiCo is a successful company with substantial revenue, and a large

footprint in the market place. PepsiCo should continue to expand their growth and take

advantage of potential opportunities by continuing to improve on areas at the corporate

top level, in the markets that they currently are in, and in new markets and market

segments that they wish to expand into.

PepsiCo should expand into markets and market segments that they are currently not in, such as Asia, India, and South America, in order to expand their market share at the global level and to increase their overall revenue.

PepsiCo should improve their employee relations in order to create employees allover the world that will promote the product both during their work day and in their personal life in order to create "word of mouth marketing".

PepsiCo should look to cut some of their expenses as they currently have $10billion more in revenue than the competition, but they have a similar Net Income of $5.5 billion.

PepsiCo needs to continue to expand their market share in the markets where they currently have a strong presence in order to maintain their market share and their footprint in the marketplace.

PepsiCo should become more proactive in the health food/product marketplace rather than being reactive to the market trends. They need to improve their responsiveness and future projections to market trends and changes.