Recommendation
There are many things that PepsiCo is doing well at and should consider doing in the future. On the other hand, there are multiple things that PepsiCo could work on and improve in the future. One thing that PepsiCo does well and should continue doing in the future is making wise decisions about mergers and acquisitions. In order to continue to grow their business, PepsiCo should continue to make successful mergers and acquisitions of beverage, bottling, and snack companies. In addition, 22 brands that PepsiCo owns are currently earning more than $1 billion a year. This means that PepsiCo does not have to rely on a couple brands to generate a lot of revenue. Instead, PepsiCo has many brands that help contribute to the overall income of the company. Lastly, PepsiCo has spent a large amount of money on marketing and advertising campaigns. These campaigns have been successful and resulted in growing market share over the company's competitors.
PepsiCo could improve their dependence on Wal-Mart. Currently, over 13% of their revenues are generated by sales in the Wal-Mart stores. Because of this, Wal-Mart can easily demand certain prices which leave PepsiCo with small profit margins. Going forward, I think that PepsiCo should decrease their dependence on Wal-Mart by placing more products in other stores that compete with Wal-Mart. Another improvement PepsiCo could make is their pricing decisions. Compared to competitors, PepsiCo's prices are usually lower. Low prices translate to low quality products to customers. In the future, PepsiCo should raise their prices to match their competitors. This will help to eliminate a view from customers of low quality products. Lastly, PepsiCo could improve some of their practices that are seen as questionable to the public. Recently, PepsiCo was found to be using tap water in their bottled waters and selling the product to customers who believed the water was from mountain springs. PepsiCo should improve their questionable practices by eliminating the use of deceptive marketing and being more transparent to consumers.
Looking to the future, PepsiCo has many opportunities to improve themselves. The first growth opportunity is found in the emerging markets where the beverage and snack consumption is rapidly growing. If PepsiCo can successfully invest in these emerging markets, it could increase their revenues and market share drastically. This will also help them rely less on sales in the United States. A second growth opportunity is found in the increase of consumer demand for healthier food and beverage options. If PepsiCo expands more into these product categories, they could drastically increase their sales. In order to do this, they will have to produce food and drinks with lower amounts of sugar and calories.
In conclusion, I recommend that PepsiCo continue to make wise decisions about mergers and acquisitions, successfully operate the brands they currently own, and create effective marketing campaigns. I recommend PepsiCo reduce their dependence on Wal-Mart, increase their prices, and clean-up some of their questionable business practices. Lastly, I recommend PepsiCo take advantage of the emerging markets and healthier consumer preferences.
PepsiCo could improve their dependence on Wal-Mart. Currently, over 13% of their revenues are generated by sales in the Wal-Mart stores. Because of this, Wal-Mart can easily demand certain prices which leave PepsiCo with small profit margins. Going forward, I think that PepsiCo should decrease their dependence on Wal-Mart by placing more products in other stores that compete with Wal-Mart. Another improvement PepsiCo could make is their pricing decisions. Compared to competitors, PepsiCo's prices are usually lower. Low prices translate to low quality products to customers. In the future, PepsiCo should raise their prices to match their competitors. This will help to eliminate a view from customers of low quality products. Lastly, PepsiCo could improve some of their practices that are seen as questionable to the public. Recently, PepsiCo was found to be using tap water in their bottled waters and selling the product to customers who believed the water was from mountain springs. PepsiCo should improve their questionable practices by eliminating the use of deceptive marketing and being more transparent to consumers.
Looking to the future, PepsiCo has many opportunities to improve themselves. The first growth opportunity is found in the emerging markets where the beverage and snack consumption is rapidly growing. If PepsiCo can successfully invest in these emerging markets, it could increase their revenues and market share drastically. This will also help them rely less on sales in the United States. A second growth opportunity is found in the increase of consumer demand for healthier food and beverage options. If PepsiCo expands more into these product categories, they could drastically increase their sales. In order to do this, they will have to produce food and drinks with lower amounts of sugar and calories.
In conclusion, I recommend that PepsiCo continue to make wise decisions about mergers and acquisitions, successfully operate the brands they currently own, and create effective marketing campaigns. I recommend PepsiCo reduce their dependence on Wal-Mart, increase their prices, and clean-up some of their questionable business practices. Lastly, I recommend PepsiCo take advantage of the emerging markets and healthier consumer preferences.