Pepsi-Cola

15 Pages 3691 Words

There is a definite competitive rivalry defined between PepsiCo and other companies. The first one that comes up in everyone’s head is Pepsi and Coke which has continued on for nearly a century; others include Lance, Kraft, Proctor and Gamble. All of these companies have produced one of the most competitive market rivalries today; however, not as high if it was an oligopoly, a market of only 4 suppliers with intense rivalry. However, profits continue to be high for each company.
Strengths
· Merger combined two strong companies, PepsiCo and Quaker Oats.
· Savings resulting from economies of scale.
· Company does more than just soft drinks.
· PepsiCo has outstanding reputation with Minorities.
· Merger of Quaker Oats produced synergy across the board.
· Record revenues and increasing market share.
· Lack of capital constraints.
· Strong existing product brands.
· Number 1 maker of snacks, such as corn chips and potato chips.

Weaknesses
· Merger combined more than carbonated and noncarbonated drinks.
· Harder to inspire vision and direction for this large global company.
· Not all PepsiCo products bear the company name.
· Company’s broad holdings are still seen as separate entities, not as parts of PepsiCo.

Opportunities
· Merged company should be able to expand markets.
· Coke’s pass on Quaker Oats should open door for PepsiCo.
· Noncarbonated drinks are the fastest-growing part of the industry.
· Pepsi gains sponsorship rights to NFL.
· Pepsi bumps Coke as United Airlines’ cola of choice.
· 10/01 Pepsi's P/E ratio matches Coke's for the first time in ten years.
· Over 50 percent of the company's sales come from Frito-Lay.

Threats
· PepsiCo has a large investment in Quaker Oats in order to get jump on noncarbonated drink market.
· Newly acquired Quaker Oats will require restructuring to provide synergy between warehousing and distribution.
· Over 50 percent of the company...