A REAL SWOT ANALYSIS

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Lets take a look at a few of the popular ones:

STEP analysis the same PEST factors in a different order SLEPT analysis the PEST analysis with legal issues separated from the political factors PESTLE, PESTEL or PESTER analysis legal (or regulation change) plus environmental (or ecological) changes are added. I tend to use PESTER in my own strategy work because its the one I learnt in my MBA training.

STEEPLE is PEST with legal, ecological and ethical issues added. STEEPLED analysis is STEEPLE with demographics pulled out of the social changes.

SWOT ANALYSIS What is SWOT Analysis? A SWOT analysis stands for Strengths, Weaknesses, Opportunities, and Threats and is a simple and powerful way to analyze your company's present marketing situation. The best way to understand SWOT is to look at an actual example: AMT is a computer store in a medium-sized market in the United States. Lately it has suffered through a steady business decline caused mainly by increasing competition from larger office products stores with national brand names. The following is the SWOT analysis included in its marketing plan. STRENTH: Knowledge. Our competitors are retailers, pushing boxes. We know systems, networks, connectivity, programming, all the VARs, and data management. Relationship selling. We get to know our customers, one by one. Our direct sales force maintains a relationship. History. We've been in our town forever. We have loyalty of customers and vendors. We are local. WEAKNESSES:

Costs. The chain stores have better economics. Their per-unit costs of selling are quite low. They aren't offering what we offer in terms of knowledgeable selling, but their cost per square foot and per dollar of sales are much lower. Price and volume. The major stores pushing boxes can afford to sell for less. Their component costs are less and they have volume buying with the main vendors. Brand power. Take one look at their full page advertising, in color, in the Sunday paper. We can't match that. We don't have the national name that flows into national advertising. OPPORTUNITIES: Local area networks. LANs are becoming commonplace in small business, and even in home offices. Businesses today assume LANs as part of normal office work. This is an opportunity for us because LANs are much more knowledge and service intensive than the standard off-the-shelf PC. The Internet. The increasing opportunities of the Internet offer us another area of strength in comparison to the box-on-the-shelf major chain stores. Our customers want more help with the Internet, and we are in a better position to give it to them. Training. The major stores don't provide training, but as systems become more complicated, with LAN and Internet usage, training is more in demand. This is particularly true of our main target markets. Service. As our target market needs more service, our competitors are less likely than ever to provide it. Their business model doesn't include service, just selling the boxes. THREATS: The computer as appliance. Volume buying and selling of computers as products in boxes, supposedly not needing support, training, connectivity services, etc. As people think of the computer in those terms, they think they need our service orientation less. The larger price-oriented store. When we have huge advertisements of low prices in the newspaper, our customers think we are not giving them good value. SWOT analysis is a simple framework for generating strategic alternatives from a situation analysis. It is applicable to either the corporate level or the business unit level and frequently appears in marketing plans. SWOT (sometimes referred to as TOWS) stands for Strengths, Weaknesses, Opportunities, and Threats. The SWOT framework was described in the late 1960's by Edmund P. Learned, C. Roland

Christiansen, Kenneth Andrews, and William D. Guth in Business Policy, Text and Cases (Homewood, IL: Irwin, 1969). The General Electric Growth Council used this form of analysis in the 1980's. Because it concentrates on the issues that potentially have the most impact, the SWOT analysis is useful when a very limited amount of time is available to address a complex strategic situation. The following diagram shows how a SWOT analysis fits into a strategic situation analysis. Situation Analysis / \ Internal Analysis External Analysis /\ /\ Strengths Weaknesses Opportunities Threats | SWOT Profile The internal and external situation analysis can produce a large amount of information, much of which may not be highly relevant. The SWOT analysis can serve as an interpretative filter to reduce the information to a manageable quantity of key issues. The SWOT analysis classifies the internal aspects of the company as strengths or weaknesses and the external situational factors as opportunities or threats. Strengths can serve as a foundation for building a competitive advantage, and weaknesses may hinder it. By understanding these four aspects of its situation, a firm can better leverage its strengths, correct its weaknesses, capitalize on golden opportunities, and deter potentially devastating threats.
INTERNAL ANALYSIS:

The internal analysis is a comprehensive evaluation of the internal environment's potential strengths and weaknesses. Factors should be evaluated across the organization in areas such as:

Company culture Company image Organizational structure Key staff Access to natural resources Position on the experience curve Operational efficiency Operational capacity Brand awareness Market share Financial resources Exclusive contracts Patents and trade secrets

The SWOT analysis summarizes the internal factors of the firm as a list of strengths and weaknesses.
EXTERNAL ANALYSIS:

An opportunity is the chance to introduce a new product or service that can generate superior returns. Opportunities can arise when changes occur in the external environment. Many of these changes can be perceived as threats to the market position of existing products and may necessitate a change in product specifications or the development of new products in order for the firm to remain competitive. Changes in the external environment may be related to:

Customers Competitors Market trends Suppliers Partners Social changes New technology Economic environment Political and regulatory environment

The last four items in the above list are macro-environmental variables, and are addressed in a PEST analysis. The SWOT analysis summarizes the external environmental factors as a list of opportunities and threats. How to Perform a SWOT Analysis? A SWOT Analysis is an integral part of a marketing plan and can also be part of a business plan. Knowing what a SWOT Analysis is and how to perform one is very important. Conclusion: SWOT helps a company to set itself for better and for worse. Companies are inherently insular and inward looking SWOTs are a means by which a company can better understand what it does very well and where its shortcomings are. SWOTs will help the company size up the competitive landscape and get some insight into the vagaries of the marketplace. SWOT analysis has been a framework of choice among many managers for a long time because of its simplicity and its portrayal of the essence of sound strategy formulation - matching a firms opportunities and threats wit its strengths and weaknesses. Central to making SWOT analysis effective is accurate internal analysis the identification of specific strengths and weaknesses around which sound strategy can be built. SWOT ANALYSIS OF PEPSI-CO The following table shows the internal and external factors affecting the market opportunities for PepsiCo. This SWOT analysis also shows PepsiCo's internal strengths such as their experienced management team, a competitive product line, a global marketing realm, and the continuous efforts by their research and development to research trends in the industry and to be creative in exploiting those trends. Some possible opportunities noted in the SWOT analysis are the growing markets for specialized ethnic foods and healthier food products. Another opportunity is that the income of consumers is high enabling them to be less price sensitive, and convenience is becoming ever more important not only to the United States but to many countries around the world. Although PepsiCo has much strength, a few weaknesses lie in the fact that the company is so large and could possibly lose focus or have internal conflict problems. A few of the threats PepsiCo must stay aware of are the ease of reliability of its product line, the almost pure competition in pricing for its products, and the

quickness of technological advances causing existing products to be no longer the most advanced. Internal Factors Strengths Weaknesses Management Experienced, broad base of interests and knowledge Large size may lead to conflicting interests Product Line Unique, tastes good, competitive price, and convenient New one calorie products have no existing customer base, generic brands can make similar drinks - cheaper Marketing Diverse, and global awareness May lose focus, may not be segmented enough Personnel International, diverse positions Possible conflicts due to so many people, possible trouble staying focused Finance High sales revenue, high sale growth, large capital base High expenses, may have trouble balancing cash-flows of such a large operation Manufacturing Low costs and liabilities due to outsourcing of bottling Lose control and quality standards Research & Development Continuous efforts to research trends an reinforce creativity

May concentrate too much on existing products, intra-preneuralship may not be welcomed External Factors Opportunities Threats Consumer/Social Huge market in the healthy products and growing market for specialized foods for ethnic groups More expensive products than Coke, such a high price may limit lower income families from buying a Pepsi product Competitive Distinctive name, product and packaging in with regards to its markets Not entirely patentable, constant replicability by competitors Technological Internet promotion such as banner ads and keywords can increase their sales, and more computerized manufacturing and ordering processes can increase their efficiency Computer breakdowns, viruses and hackers can reduce efficiency, and must constantly update products or other competitors will be more advanced Economic Consumer income is high, more tend to eat out, convenience is important to U.S. Very elastic demand, almost pure competition Legal/Regulatory High U.S. Food & Drug Administration standards eliminate overnight competitors SWOT ANALYSIS OF PEPSI IN PAKISTAN STRENTH 1. Company Image: It also is a reputable org. and is well known all over the world. Perception of producing a high quality product.

2. Quality Conscious: They maintain a high quality as Pepsi Cola International collect sample from its different production facilities and send them for lab test in Tokyo. 3. Good Relation with Franchise: Throughout its history it has a good relation with franchisers working in different areas of the world where they have the production facilities. 4. Production Capacity: It has the highest production capacity i.e. 60,000 cases per day is not only in Pakistan but also in South Asia. 5. Market Share: It has a highest market share i.e. 62% in Pakistan and leading a far step head from its competitors. 6. Large No. of diversity businesses: This is also its main strength as it ahs diversity in many businesses such as i. Pepsi beverages ii. Pepsi foods iii. Pepsi Restaurants. 7. High Tech Culture: The whole culture and business operating environment at Pepsi-Cola-West Asia has quick access to a centralized database an they use computers as business tools for analysis and quick decision making. 8. Sponsorships: They mainly use celebrities in their advertising campaigning like Imran Khan, Wasim Akram, and Waqar Younas etc. Also sponsor social activates programs like music etc. WEAKNESS 1. Decline in taste: During the last years, it was published in Financial post that there has been big complaints from the customers with regard to the bad taste that they experienced during the span of six months.

2. Political Franchises: Such as in Pakistan, Hamayun Ahkhtar is its franchisee who has a strong political support from a political party which is in opposition. In; their era in government less taxes are imposed on them but relation increases as they come in opposition. So the selection is not appropriate as this thing is harmful to their image as well as the strategies. 3. Short term Approach: They have a lack of emphasis on this in their advertising such as currently when they losses the bid for official drink in the 96 cricket world cup. They started a campaign in which they highlight the factor such as nothing official about it. 4. Weak Distribution: They lack behind in catering the rural areas and just concentrating in the urban areas. 5. Low consumer knowledge: Unable to maximize local consumer knowledge. 6. Lack of soft drink: Lack of soft drink know-how as a result of diversified business units and generalist managers OPPORTUNITIES 1. Increase Population: As almost in all over the world growth rate is increasing which in turn increases the demand of products and necessities and especially in Asia the market is growing at a faster rate as compare to other continents. So they have to attract new entrants. 2. Changing social trend: As in all over the world people are rushing towards fast food and beverage because of life which has become much faster, it provide the company a favor to capture this fast moving market with its take away product. 3. Diversification: They may enter in garments business in order to promote their brand mane, by making sports cloths fro players which represent their name by wearing their clothes. 4. Distribution of snack foods:

Opportunity to distribute Pepsi snack foods in the future.

THREATS 1. Imitators: They also have a problem of imitators as receives complaints from customers that they find take product in disguised of Pepsis product. 2. Government Regulation: They face problem if government employ taxes on them which force them to raise the price of their product. 3. Corporations shortage problem: Again this is also a serious threat from it suppliers as if supplier is unhappy with the company. He may reduce the supply and exploit the company. This action will surely affect the production process. 4. Non-carbonated substitutes: Non-carbonated substitutes, such as juices and tea brands are maintaining a strong foothold in the market. 5. Political instability: The big threat to Pepsi in Pakistan is Political instability and civil unrest. 6. Threat of labor strikes: External threat of labor strikes and power outages in Pakistan. SWOT MATRIX (TOWS MATRIX) What is a SWOT Matrix (TOWS Matrix)? The SWOT Matrix illustrates how management can match the opportunity by facing your institution with its own strength and weekness to yield four sets of possible strategic alternatives. The SWOT Matrix framework lends itself to brainstorming to create alternative strategies that you might not otherwise consider. How to Perform a SWOT Matrix (TOWS Matrix)? A firm should not necessarily pursue the more lucrative opportunities. Rather, it may have a better chance at developing a competitive advantage by identifying a fit between the firm's strengths and upcoming opportunities. In some cases, the firm

can overcome a weakness in order to prepare itself to pursue a compelling opportunity. To develop strategies that take into account the SWOT profile, a matrix of these factors can be constructed. The SWOT matrix (also known as a TOWS Matrix) is shown below: SWOT / TOWS Matrix Strengths Weaknesses

Opportunities S-O strategies W-O strategies

Threats S-T strategies W-T strategies

Basically four main strategies are proposed:

S-O strategies pursue opportunities that are a good fit to the companies strengths. These strategies are based on institutional strengths to take advantage of market opportunities. W-O strategies overcome weaknesses to pursue opportunities. These strategies are based on overcoming institutional weaknesses to take advantage of market opportunities. S-T strategies identify ways that the firm can use its strengths to reduce its vulnerability to external threats. These strategies are based on institutional strengths to avoid market threats. W-T strategies establish a defensive plan to prevent the firm's weaknesses from making it highly susceptible to external threats. These strategies are based on overcoming/minimizing institutional weaknesses to avoid market threats.

TOWS MATRIX OF PEPSI

We have discussed SWOT analysis of Pepsi-Co in our previous topic now here we are going to discuss the TOWS Matrix of Pepsi-Co, keeping in mind its SWOT analysis. Following is the detailed analysis of Pepsi-Cola TOWS matrix: WT ANALYSIS

One weakness that Pepsi posses is that it has very strong taste it really feels that something highly toxic going inside the body, where as the same product of the coke is not much strong. They also have a problem of imitators as receives complaints from customers that they find take product in disguised of Pepsis product. During the last years, it was published in financial post that there has been big complaints from the customers with regard to the bad taste that they experienced during the span of six months. If they soon pay no attention towards that this will create a big problem for them. Large size may lead to conflicting interests. New one calorie products have no existing customer base; generic brands can make similar drinks cheaper. It is also big threat for any company people may like or dislike new launching product. Such as in Pakistan, Hamayun Ahkhtar is its franchisee who has a strong political support from a political party which is in opposition. In; their era in government less taxes are imposed on them but relation increases as they come in opposition. So the selection is not appropriate as this thing is harmful to their image as well as the strategies. So this may become a big threat for the Pepsi.

WO ANALYSIS

They have a lack of emphasis on this in their advertising such as currently when they losses the bid for official drink in the 96 cricket world cup. They started a campaign in which they highlight the factor such as nothing official about it. If they dont focus on sudden changings in their advertising then they can convert this weakness into opportunity. They lack behind in catering the rural areas and just concentrating in the urban areas. They should try to increase their distributions and also focus on capturing rural areas; this will become a big opportunity for them. The other big weakness on Pepsi is that they dont pay any attention towards garments. They may enter in garments business in order to promote their brand

name, by making sports cloths fro players which represent their name by wearing their clothes. That must increase the customer and income of the Pepsi.

High expenses may have trouble balancing cash-flows of such a large operation. The staff may show dishonesty. They should try to pay much attention towards their cash flow, and audit there statements on regular basis.

ST ANALYSIS

In many countries Pepsi had more expensive products than Coke; such a high price may limit a lower income family from buying a Pepsi product, therefore which is a big threat for Pepsi that may Pepsi have to face in the future. In foreign countries Pepsi have many branches with different flavors as compare to Pakistan, which has only 2 or 3 Pepsi products. Non-carbonated substitutes, such as juices and tea brands are maintaining a strong foothold in the market. Pepsi has a big threat from COKE, which are its main competitor from about 100 years. Pepsi is a foreign company therefore they have a big threat every time on them of Political instability and civil unrest. The whole culture and business operating environment at Pepsi-Cola-West Asia has quick access to a centralized database and they use computers as business tools for analysis and quick decision making. Computer breakdowns, viruses and hackers can reduce efficiency, and must constantly update products or other competitors will be more advanced. Continuous efforts to research trends an reinforce creativity, if they fail in their efforts then there is a big threat for the company. The competitors may get benefit by their plans.

SO ANALYSIS

The whole culture and business operating environment at Pepsi-Cola-West Asia has quick access to a centralized database and they use computers as business tools for analysis and quick decision making. Internet promotion such as banner ads and keywords can increase their sales, and more computerized manufacturing and ordering processes can increase their efficiency and that will become such a big opportunity for Pepsi. It has the highest production capacity i.e. 60,000 cases per day is not only in Pakistan but also in South Asia. Established network of 45 distributors each supplying 1,100 retailers. High per capita soft drink consumption average of 22 servings compared to 5 for Pakistan. At will become such a big opportunity.

Due to large production the product of Pepsi is always available in the market and that will become useful to attract taste lovers customers.

Large No. of diversity businesses is also its main strength as it ahs diversity in many businesses such as Pepsi beverages, Pepsi foods, Pepsi Restaurants, and due to large number of diversity they can capture more customer, therefore it will become such a big opportunity for Pepsi. Pepsi is also a reputable organization, and is well known all over the world. Perception of producing a high quality product and strength can become a big opportunity for Pepsi if they use it in well arranged manner, such as advertising more and also by conducting concerts to attract more customers. They maintain a high quality as Pepsi Cola International collect sample from its different production facilities and send them for lab test in Tokyo, if they show test reports on label of there products this will also attract customers. They mainly use celebrities in their advertising campaigning like Imran Khan, Wasim Akram, and Waqar Younas etc. Also sponsor social activates programmed like music etc. this will become such a big opportunity to build such a large number of customers. So we can say that it is one of the big strength that may become a big opportunity for Pepsi.

Internal analysis is the process of evaluating an organizations strength and weaknesses. It is important to conduct an internal analysis to find the strengths and weaknesses of the company. This paper presents an internal analysis of the PepsiCo Company.

Strengths
One of the greatest strengths for PepsiCo is its brand. PepsiCo is one of the companies with the largest brand recognition in the world (PepsiCo, 2010). The brand name Pepsi is known in virtually every country in the world. The strong brand presence makes it easier for the company to market its products around the world. Under the Pepsi company brand, PepsiCo has numerous other product brands. All these brands have rode on the success of the company brand and have found it easy to sell since the company brand in largely accepted in the market. The popularity of PepsiCo corporate brand has also made it easier for the company to introduce new products in the market. All PepsiCo has to do in order to make a new product success is to attach it with the companys corporate brand which has already attained a significant level of brand loyalty in the beverage market. Another key strong point for PepsiCo is a large distribution network. One of the core elements that define an organizations success is the organizations ability to take it product near the consumer (PepsiCo, 2010). PepsiCo has managed to do this through establishment of a massive distribution network. PepsiCo runs bottling units in diverse geographical region which enables the company to produce its products near the consumers. This reduces the cost of transportation and storage.

In addition, PepsiCo has established relationship with small and mega retailers who sell PepsiCo products to the final consumers. Forming partnership with large retailers such as Wal- Mart has enabled the company to expand its reach to the market. Similarly, partnership with small retail business has enabled the company to take it products to even the remotest parts of the world. Apart from retail chains, PepsiCo has also teamed up with fast food restaurants around the world which have also provided the company with a wide network of outlets (PepsiCo, 2010).

Competitive Advantage
The beverage industry is one of the most competitive industries in the world because it is filled by numerous products competing against each other. In order to remain in business, any company needs features that gives it an edge over it competitors (Olsen, 2011). One of the PepsiCos competitive advantages is its innovative lines of products. PepsiCo has been on fore front in the development of innovative beverage products for different segments of the market. Core has over 20 lines of products with each targeted to different groups of people. The ability of the company to come up with new and innovative products has enabled the company to change as consumers needs evolve and thereby remain relevant in the market. Another competitive advantage of PepsiCo is the ability to respond quickly to market opportunity and threats. PepsiCo innovativeness gives it the ability to respond quickly to changes in the market. The company convenient size also gives it the ability to move quickly. The company is neither to small like most of its competitors neither is to large like its main competitor, Coca Cola. The relatively large size of the organization gives the organization access to resources that also make it easier for the company to move quickly.

Internal Weaknesses
One of the internal weaknesses found in PepsiCo is the companys reliant on franchised bottling company to distribute its products (PepsiCo, 2010). This strategy has seen the company create very powerful bottlers that it cannot exert control over. Sometimes, the franchises oppose introduction of new products by PepsiCo while other refuse to manufacture some of the products. Sometimes, the franchises develop their own product lines that are not part of the PepsiCos brands. The franchise system has also limited the ability of the company to expand its operations (PepsiCo, 2010). Unlike Coca Cola, which is able to invest in its bottling companies, PepsiCo cannot invest in its bottling companies since it does not own them. This has hindered the growth and expansion of the company since most of the individual investors have limited capacity to make such investments.

Lesson Learnt from the Module

Every organization has its strong and weak point and the only way to succeed is by understanding these points (Schermerhorn, 2010). This knowledge enables an organization to build on its strengths and improve on its weaknesses thereby becoming more competitive in the market. Internal analysis is the process used by organization to evaluate its strength and weaknesses. Competitive advantage refers to aspects that are unique to an organization and which give the organization an edge over the others (Olsen, 2011). This implies that, in order for competitive advantage to work for a company, it must be very difficult for the company to imitate.

References
Olsen E. (2011). Competitive Advantage: Building a Lasting Organization. February 22, 2012. Retrieved from http://homebusiness.about.com/od/growing/a/comp_advantage.htm PepsiCo (2010). PepsiCo 2010 Annual Report. February 22, 2012. Retrieved fromhttp://www.pepsico.com/Download/PepsiCo_Annual_Report_2010_Full_Annual_Report.

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Schermerhorn J. (2010). Management. USA. John Wiley and Son

There are many companies the world over, that conduct PESTLE analysis on their brands in order to ascertain strategies for the future or else to understand the market before launching them. It is a fundamental tool of market planning and strategizing that must be carried out to comprehend market trends and the systematic risks involved. PESTLE analysis gives you an overview of the whole situation your business might be in. Precisely, it is a birds eye view of the stimulus and the scenarios that surround your trade and you business. PESTLE, is an acronym in which each letter denotes certain factors for the study. These factors affect the market in many ways and alter the way strategies are thought of and made. P stands for political factors, while E stands for economic ones. S has to do with social factors in a country whereas T sums up all the technological aspects of the market. L denotes legalities of the environment and E accounts for the environmental aspects and its influence upon the nature of the trade youre in. Almost every major and minor organization tries to conduct this analysis, but with regards PESTLE analysis example, I would cite an example of a real life case study in which PepsiCo, a beverage giant carried out the PESTLE analysis over its brands. PESTLE ANALYSIS BY PEPSICO. PepsiCo is the largest selling beverage the world over, of course after its arch rival Coca Cola. It accounts for a 37% share of the global beverage market, and therefore they need to understand each and every countrys market in order to stay in line with their PESTLE situations. Pepsi is a big brand, currently holds the 23rd place in the Interbrands report of the Worlds Leading Brands. Their advertisements feature major celebrities and athletes like David Beckham, Robbie Williams, Britney Spears, and Michael Jackson etc. Their market reach is also very diverse, as theyre present in almost every country from the US to New Zealand. Their PESTLE analysis is given below:

Political: Pepsi is a non-alcoholic beverage and is therefore regulated by the FDA (Food and Drug Administration). So, theyre supposed to maintain a firm standard of the laws set out by the FDA with consistency. Also, many different markets across the world have different set of regulations that are either relaxed or are either stringent. There is competitive pricing by Pepsis competitors and that is one factor that Pepsi has to keep in mind at all times. The political scenario also matters greatly as there can be some civil unrest in certain markets or due to inflation the sales of the product can fall. Most importantly, cross border situations are starkly different therefore Pepsi has to stay in line with all those policies and changes so that they can adapt to all those changes accordingly. Economic: As the recent economic downturn has plagued the economy, companies had to restructure their sales and marketing campaigns greatly. Also, with diminishing profits they had to undergo downsizing internally and re-think upon how to penetrate the market. Economic conditions have the highest influence on a business, regardless of what trade it is in. Though, in Pepsis favor, the economic downturn that started in 2008 resulted in increased sales of its beverages mainly as people were being laid off from jobs, they were spending time with friends and family or at home. Social: Social factors greatly impact Pepsi, as its a non-alcoholic beverage it has to remain in line with the strict and stark differences of cultures the world over. Also, Pepsi has to communicate its image as a global brand so that the people can associate it with themselves as something that connects the world together. Usually, the social implications are seen in marketing campaigns for example certain countries have religious festivals, so Pepsi has to keep in line with all those festivals in order to understand the psyche of their market and how they can cash upon the opportunity. Technological: With the advent of the new age in technology, companies have completely integrated themselves with all the recent changes that have taken place. To mention a recent trend that has greatly picked up and something that almost every business is turning toward is Social Media. The social media explosion has allowed for increasingly interactive engagement with the consumers with real time results so Pepsi has to stay ahead of all the developments that take place with keeping in view how the youth of today utilizes technology for their benefit and how can Pepsi reach them in order to keep on increasing brand recall and brand engagement.

Legal: There can be many legal implications upon the beverage industry. I would cite one very famous incident took place in India, where Pepsi was accused of using contaminated water, given a lab test that was done upon the water flowing into the Pepsi factory that was located nearby an industrial estate. A massive recall was issued for the products from shelves and then the product was tested costing the company many billions of dollars upon the tests as India is a very major market. Environmental: These factors can affect Pepsi, but not immensely alter its trade and profit generation as these factors affect agri-businesses much more directly.

PepsiCo has followed a differentiation strategy at the business level due to the following reasons

The wide portfolio of products including carbonated beverages and snack foods help it reach out to a vast demography among the customer base. The assortment of choices enables various customers to meet their refreshment demands through PepsiCo products of their preference.

PepsiCo is a global company with operations in several countries. In order to obtain a share of wallet of consumers in different regions, it must provide products that are tuned to the tastes and preferences, prevalent in those local regions. This also explains the rationale behind having variety of products so that buyers perceive value for money through their preferred brands.

PepsiCo operates in a duopoly market competing with Coke only. It need not adopt a cost leadership strategy as both the cola majors take price signals from each other and adjust markup prices accordingly, to retain market share and revenue. There has rarely been an all-out price war between the two which would have ultimately bled both to huge losses. This allows both players to compete on the basis of differentiated products targeted at a wider and more diverse customer base

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Pepsi Co Swot
PepsiCo SWOT Analysis Strengths Established name and good reputation Wide range of products (Diversification) Vast distribution channel and easy availability Weaknesses Competitors such as Coca Cola have more market share Targets only young customers on promotions Overdependence on Wal-Mart

 Overdependence on US markets Low productivity Image damage due to product recall Opportunities New product can easily penetrate in the market Internet promotion and ordering processes Broadening of product base International expansion Growing savoury snack and bottled water market in US Threats Tough rivalry from competitors Rising costs in raw materials and travel expenses Substitutes (decline in carbonated drink sales) Potential negative impact of government regulations Potential disruption due to labour unrest PESTLE Analysis Political Raw material prices becoming worrying Land acquisition for new factories Government focusing on stricter water pollution norms Supposed to maintain firm standard laws set by the FDA Competitive pricing Economic New opportunities in other countries

 Fuel price Availability of labour Economic downturn Social Replenishing water Partnership with farmers Solid waste management program Impact on youngsters Different cultures Communicate as a global brand Technological Operates in almost all countries Newer and more attractive designs Newer and better manufacture Social media Legal Cross border policies Standards and regulations Health and safety Environmental CSR PepsiCo Mission and Vision http://www.pepsico.com/Company/Our-Mission-and-Vision.html Our Mission and Vision

At PepsiCo, we believe being a responsible corporate citizen is not only the right thing to do, but the right thing to do for our business. Our Mission Our mission is to be the world's premier consumer products company focused on convenient foods and beverages. We seek to produce 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 in everything we do, we strive for honesty, fairness and integrity. Our Vision "PepsiCo's responsibility is to continually improve all aspects of the world in which we operate - environment, social, economic - creating a better tomorrow than today." Our vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company. Performance with Purpose At PepsiCo, we're committed to achieving business and financial success while leaving a positive imprint on society - delivering what we call Performance with Purpose. Our approach to superior financial performance is straightforward - drive shareholder value. By addressing social and environmental issues, we also deliver on our purpose agenda, which consists of human, environmental, and talent sustainability.

2. Company Analysis: External Analysis PEST Analysis: The Pest Analysis identifies the political, economical, social a technological influences on an organization. Political influences: - The production distribution and use of many of PepsiCo product

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are subject to various federal laws, such as the Food, Drug and Cosmetic Act, the Occupational Safety and Health Act ad the Americans with Disabilities. - The businesses are also subject to state, local and foreign laws. - The international businesses are subject to the Government stability in the countries where PepsiCo is trying get into (underdeveloped markets). - The federal, state, local and foreign environmental laws and regulations. The businesses are also subject to de taxation policy in
The Pepsi-Cola Story Summer of 1898, a young pharmacist Caleb Bradham looking for ways to attract people to his pharmacy invented the beverage now known around the world as Pepsi-Cola. After the first ...

each country they are operating. - They also have to comply with federal, state, local and foreign environmental laws and regulations. Economic influences: - The companies are subject to the harvest of the raw material that they use in their snack foods, soft drink and juice, like corn, oranges, grapefruit, vegetables, potatoes, etc. - Because of they rely on trucks to move and distribute many of their products, fuel is also an important subject, so they are subject to the
Pepsi Cola Marketing Mix Pepsi Cola Marketing Mix Pepsi Co., one of today s leading soft drink companies, has not only revolutionized the soft drink industry with its creative marketing techniques and unforgettable taste, ...

fuel prize fluctuation, and to possible fuel crisis. - Operating in International Markets involves exposure to volatile movements in foreign exchange rates. The economic impact of foreign exchange rates movements on them is complex because such changes are often linked to variability in real growth, inflation, interest rates, governmental actions and other factors. PepsiCo is also subject to other economical factors like money supply, energy availability and cost, business cycles, etc. Sociocultural influences: PepsiCo and moreover Pepsi is
International Business - Coca Cola Entering The Indian Market Introduction To give a short introduction to the circumstances affecting this case of Pepsi & Coca Cola it has to be said that in general it is not just simple ...

subject to the lifestyle changes, because of it bases her advertising campaigns in a concrete kind of people with an special lifestyle, it is for that PepsiCo has to pay a special attention on the lifestyle changes. Particularly in the United States Pepsi drinkers are very defined, there is a kind of people who drinks Pepsi another kind who drinks Coca-Cola, it is for that they have to pay attention to the social mobility for not losing a possible
Marketing Mix Of Pepsi-Cola Todays PepsiCo, Inc. was found in 1965 through the merger of Pepsi Co and Frito -Lay, the worlds largest manufacturer and distributor of snack chips. In 1998, it acquired Tropicana, the ...

market. - Taking into account that PepsiCo is trying to introduce itself in underdeveloped markets, they have to be careful with the possible problems with the governments of this countries, and with the problems could rise from PepsiCo act with the people of this countries. Technological influences: - PepsiCo is subject to new techniques of manufacturing, for their three business sectors, snack food, juices and soft drinks. - It has to pay attention to the new distribution techniques. - And
Frito-Lay Tostistos Frito-LaysTostitos In 1932, Elmer Doolin, who was in the icecream business, bought a recipe for corn chips from a Mexican man who was eager to leave the states and ...

they have to fix their attention in the competence developed, to know about the new products. Porters Diamond: The Porters Diamond Analysis tries to explain the Competitive Advantage of Nations. There are four attributes of a nation comprise Porters Diamond of national advantage, they are: Factor Conditions: The basic factor conditions are natural resources, climate, location, the more advanced factor conditions are skilled labour, infrastructure and technology. There are some of these factors that can be obtained by any company
Frito-Lay Tostistos Frito-LaysTostitos In 1932, Elmer Doolin, who was in the icecream business, bought a recipe for corn chips from a Mexican man who was eager to leave the states and return ...

(like unskilled labour and raw materials) and, hence, do not generate sustained competitive advantage. Even though, we have to take into account that specialized factors involve a heavy and sustained investment, we have to know that if we are able to achieve them, we could generate a competitive advantage. Some of the factor conditions PepsiCo has to take into account, in each country where they want to introduce are Unemployment. - Interest rate. (Short term, long term). - Labour
Frito-Lay Tostistos In 1932, Elmer Doolin, who was in the ice-cream business, bought a recipe for corn chips from a Mexican man who was eager to leave the states and return home. ...

legislation. Demand Conditions: We have to know that the nature of a country demand makes PepsiCo dependent on them. For example if in one country exists a sophisticated demand, these customers pressure firms to be competitive. Is for that, firms that face a sophisticate domestic market are likely to sell superior products because the market demands high quality and a close proximity to such customers enable the firm to better understand the needs of the customers, in the same way
Financial Analysis Created by EDGAR Online, Inc. COCA COLA CO Income Statement2 Period End: Dec 31, 1999 Date Filed: Mar 9, 2000 Values in this worksheet are ...

it is easier spread their firms in the global market. Some of the demand conditions PepsiCo has to take into account en the countries where they want to introduce are: - Expectation of customers. - GNP & RPI. Competitive research (trends) - And with competitors are established in the country. Related and Supporting Industries: For any company it is really important the Related and Supporting Industry. Knowing who are the range of suppliers, and the related industries, is necessary
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for deciding where we have to place our company. In some cases the concentration of related and supporting industries provoke the

concentration of the similar industries in the same areas. Some advantages and disadvantages of locating close to your rival may be: Some advantages to locating close to your rivals may be: o Potential technology knowledge spillovers, o An association of a region on the part of consumers with a product and high quality and therefore some market power,
Coke Extract Australia Blocks Bid By Coke to Purchase Cadbury Beverages The Coca-Cola Company has come under recent fire in most of its international markets. The Chairman Douglas Ivester has made a ...

or o An association of a region on the part of applicable labour force. Some disadvantages to locating close to your rivals are: o Potential poaching of your employees by rival companies and o Obvious increase in competition possibly decreasing mark-ups. Firm Strategy, Structure & Rivalry: Concerning to the strategy and the structure of the firm, they would be conditioned by the tradition of the country. There are different management styles in each country, and besides
Soft Drink Industry Case Study Soft Drink Industry Case Study Table of Contents Introduction 3 Description ...

they vary depending on the industry. PepsiCo has to study the different styles of management, for acting in the best way in each country, adapting its strategy and its structure as far as possible. As far as possible the rivalry, in general is better the national than the international. In the case of PepsiCo (Pepsi) ;for them it is more advisable that when they are introducing in a new market, its main rival (Coca-Cola) not be positioned or at least
Ceo Pay 1 November 1999 CEO Compensation The lead story in the March 31, 1997 issue of The Wall Street Journal was an in depth study of the life of a seventy-three ...

it is not to absolute leader of the market. Five Forces We do the same analysis for the three different markets of PepsiCo: the soft drink market, the snacks market and the chilled orange juice market. We treated the three markets as a the same industry, with some exceptions as the

competence The threat of entry Established brands with a lot of experience in the market that a have a good channel of distribution. The brands deliver the products
Pizza Hut In Brazil Pizza Hut in Brazil Starting a business in a new country requires a lot of research. It is important to understand that country's political and economic system as well as ...

directly to the supermarket, this means that is necessary a big company structure (lorries, warehouses, producing plants, etc.) to arrive at retailers and supermarkets, all of this requires a big investment of money. Suppliers Well looks that at first sight, suppliers are not a problem because its easy to find potatoes, corn and oil suppliers. The problem that we find here is the possibility of variability of prices in the raw materials caused for example by a bad year of
Philosophy - Coca Cola Objective 1: the origin, relevence, and methodology of the social sciences by analyzing philosophy.Drink Coke and be niceCoca-Cola s CEO espouses a gentler business planWilliam J. HolsteinUS NEWS 6/9/97 The ...

harvesting, or there is another petrol crisis. Also in some countries that have not petrol normally fuel petrol is more expensive and the fuel suppliers have an oligopoly of the market. Buyers Considering that buyers are the final consumers, we can say that in this markets the consumers get used at one kind of taste, and they have this products for the importance of the brand, its a marketing issue as well. Substitutes In these three markets is quite difficult
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to find substitutes. More than substitutes we can talk more of fashion, trends, or costumers tastes. Suddenly people stop has orange juice for breakfast and take more milk or coffee in mornings. Its quite difficult to find a substitute for these products because normally the people get used at one kind of taste of cola for example, then is very difficult to try to adapt the public to a new cola. Competitive Rivalry Well these three markets are really full

Coke - Pepsi Management Report In the late years of the 19th century, a new industry was getting born. An industry that was to become established as a major player in the market later in ...

of rivalry. First there is the Cola market where Coca-Cola owns an incredible 51% market share, followed far away Pepsi with a 21% of market share, is very difficult to penetrate in this market. Then there is the Snack market where Lays have the 40% of market share, the second most important brand is Procter &Gamble (P&G), in this market the shares are more distributed, but still being two majors competitors that have most of the market. An at
Coke Vs Pepsi Mounting competition between Coca-Cola (Coke) and Pepsi Cola (Pepsi) had a very long standing in the American history. Both cola have thus made themselves a household name in the global ...

the last we have the