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Ommid Nikraz. Andreanne Matarundo. Iqbal adifatiyan syach. Eydolf Heetler. Vlad Gidea. Khalid Benariba. Sandra Hbaieb. PepsiCo Inc operates in an oligopoly market. An oligopoly market has a small number of firms dominating the market.
The actions of any of the dominant firms affect the other companies. These firms dominate the beverage market and usually buy out other small companies that enter the market. All these firms sell identical and differentiated products. The beverage industry has entry barriers. Although it is possible for new entrants to enter the beverage market in the US, as the legalities are favorable, the threat of entrant is high Gamble and Thompson, It is difficult for a new beverage company to maneuver in the industry in the presence of the well-established companies, which have been in the industry for a long time.
The reason behind this argument is that the industry is very competitive. Any new entrant in this industry must be financially stable and have well-formulated strategies to help expand the market share and enhance competitiveness. This kind of situation is hard especially in the U.
The already existing companies have established brand loyalty and this makes it hard for new entrants to establish and enjoy competitive advantage since the customers in this market are very sensitive and they would rather buy a product that they know the manufacturer at a high price, rather than a new cheap product from a new manufacturer.
A small number of dominant companies, differentiated goods and barriers to market industry are characteristics of an oligopoly market snacks. In addition, the company has a variety of products that are available all over the world a clear indication that it is a success and growth oriented Beverage Company. Currently, PepsiCo Inc distributes its products to over countries worldwide.
The food products produced by the company include flavored snacks, chips, rice, cereals, dairy-based product and pasta. By the end of the year , the company had approximately employees. The company has maintained its mission of being the market leader especially in the US. As of the year , the company commanded a market share of The company seeks to continue producing quality products to its customers. At the same time, the company endeavors in providing success and growth opportunities for its employees, investors and all its business partners.
The strengths of the company are internal. First, the company has been in existence for many years and has managed to build a brand of its own. By use of celebrities, PepsiCo has managed to build a brand for those who care for their health.
PepsiCo Inc operates in over countries. This enables the company to access a large base revenue sources. Successful penetration in multiple national markets has provided a much broader customer base from which it generates revenue while minimizing costs and increasing profits Young, With its globalization, the company has a larger market base and development meaning the company risk is spread across a larger customer base.
If issues of supply, regulation or environment arise in one country, the company still operates in the other countries. Globally the company has a larger human resource pool creating access to a larger talent access. The company has approximately employees. Having diverse employees who can interact with different populations and different business partners is also an advantage.
The company has a diversified product portfolio. That ensures that the risks in the market are spread along a wide variety of products. The company also has popular subsidiary brands.
These subsidiaries have been very influential in the growth of the company. PepsiCo Inc has an efficient and strong supply chain Young, The company has regional stores where the products are stored and supplied to different areas. This has enabled the company to reach the remote areas where other companies have not managed to reach.
Combined with the global advertising done by the company by use of celebrities, the brand awareness in all regions is high. Another strength the company has is the Pepsi Refresh project which is involved in funding new ventures and idea aimed at benefiting the society.
This is part of the corporate social responsibility. Other corporate social responsibility activities include the PepsiCo Foundation. The foundation works in the sectors of health, education, water conservation, and others.
The major weakness faced by the company is competition, especially in the drinks segment. Coca-Cola is the leading brand in this segment and this force PepsiCo to highly switch brands Young, Competing against such a strong brand as Coca-Cola is hard and requires switching brands from now and then which is very risky. Another weakness is that PepsiCo Inc has a low penetration outside America. Most of the revenue generated by the company comes from the North and South America.
Mehrab Tariq. A short summary of this paper. Tidak ada pekerjaan orang lain yang kami gunakan tanpa menyebutkan sumbernya. Methods of analysis include the internal and external analysis of the company. The research draws attention to the competition PepsiCo in the Cola and Snacks industry.
Despite being a strong second opinion against Coca Cola, Pepsi has become the largest selling soft drink in the world and is liked by people of all ages. Therefore, this reearch analyses the strategies used by PepsiCo to compete with its competitors and the effectiveness of it.
Including how well PepsiCo. As the cola industry develop in popularity, Caleb created Pepsi- Cola Company in and registered a patent for his recipe in In the year , Pepsi was formally absorbed to Loft, and Loft Inc. Up until today, Pepsi Cola Company — further will be mentioned as PepsiCo — has successfully expanded it area of products through mergers and acquisition of other companies, such as Frito-Lay Company, Quaker Oat Company and other companies.
Americas Foods PepsiCo. Americas PepsiCo. This vision statement is implied by Pepsico. We seek to produce financial rewards to investors as we provide opportunities and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity.
With the existing statement, pepsico. We are triggered to use the most efficient processes using the best of machinery. By doing so, we seek to produce healthy 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 everything we do, we strive for honesty, fairness and integrity. Thus, it must consider the legal and labor forces of the countries in which it operates. The things that Pepsico should consider are tax laws, labor union, and environmental law. It should operate in accordance to the laws in the country to have a good corporate compliance and governance. If the income level per capita of the people inrcreases, it will have a positive effect on the consumption of its products. When there is a decrease in the dollar strength, it gives a bigger opportunity for Pepsico for exports.
Social, Demographic, Culturan and Environmental Forces The healthier lifestyle of the people promotes different patterns of consumption.
This could be either a threat and new opportunity for Pepsico products. Pepsico can support sports events in order to give a message to the people that Pepsico concerns about the health of the people. Besides that, the requirements of different age groups are different.
Pepsico should target that age group that consumes the soft drink or snacks. Pepsico should also consider the education level within the country for making its strategy since education has direct impact promotion and marketing.
In addition, Pepsico should also consider about the natural environment factors in operating the business as a form of contribution and responsibility to the community. The growing technology gives new opportunity for Pepsico to have new ways for Pepsico marketing strategy. The proliferation of Internet users also opens up further market opportunities for Pepsico to market its products. Competitive Forces In the food and beverage industry, Pepsico has the second largest market share.
In addition, it has the opportunity to make a partnership with well known brand such as Starbucks, and more sport tournaments that Pepsico can support. There is also growth in the carbonated drink sector which will bring new substitute products to entry. And also, some health issues are concerned regarding the products of Pepsico. High diversification from the competitor like Coca cola.
Few strong companies have a control over the market. In the present, the main competitor is Coca-Cola wand the competitor also provide a wide range of beverage products under its brand. Both Coca-Cola and Pepsi are the predominant carbonated beverages and commit heavily to sponsoring outdoor festivals and activities. There are many substitute products in the market; therefore, customer has large varieties of product. The customer in the beverage market is price sensitive, as company cannot charge high price because they have many choice of product.
There are many kinds of energy drink and soda products in the market. Many companies provide similar product in the same market.
Not only coca cola is the main competitor but PepsiCo also have other product line, which means that they also have other competitors.
Entry barriers are relatively low for beverage industry as there is already various number of the company in the market. Few multinational groups own the largest part of the market share. There is high initial cost, therefore, few company want to enter this market. Dependence on raw materials, however, there are a lot of suppliers available in the market.
The main ingredients for soft drink include carbonated water, phosphoric acid, sweetener, and caffeine. The suppliers are not concentrated or differentiated. Any supplier would not want to lose a huge customer like PepsiCo. Easy new products penetration in markets 0. Operate in the fastest growing industry 0. Changing social trends healthy foods 0. Media promotion and vending machines 0.
Partnerships with well-known brands i. Starbucks 0. More sport tournaments are being held worldwide 0.
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