Pepsi Co's Restaurants Essay

1330 words - 5 pages

SUMMARY & COMMENTSThis case presents the PepsiCo Company's situation between 1950s to early 1990s. PepsiCo is a large organization with a decentralized management approach.In 1933, 12 ounces of Pepsi was equal to a nickel where for one nickel you could buy 6 ounces of Coca Cola. By the end of 1940s, when Alfred Steele was the CEO, the company moved from low price strategy and launched an extensive marketing campaign to boost the company's image. The strategy was successful. Sales increased to $14.2 million in 1960 from a postwar low of $1.3 million in 1950.In 1963, Donald M.Kendall (CEO) and Andrall E.Pearson (COO) changed the company's cultural emphasis from passivity to aggressivity. During that time, the corporate office set strategy and maintained financial control, but left operating decisions to its energetic and industrious division managers who were eager to take charge. Kendall merged Pepsi-Cola with Frito Lay in 1965 and company name became PepsiCo.Kendall's successor, Wayne Calloway (1986), put the emphasis more on his employees. When asked by a Fortune magazine reporter to what he attributed PepsiCo's outstanding performance during his tenure, he replied "the three P's 'people, people, people'". He also believed that different experiences made great managers. He also challenged his managers to be innovative and was known for saying, "If it ain't broke, fix it anyway". All those statements made by Colloway shows his strategy in management. He believes given the right environment and empowered in a correct way, the success will come and the success of the manager would be for sure the success of the company.PepsiCo's BusinessesPepsiCo had three segments as shown in Table 1Table 1Soft Drinks Snack Foods Restaurants1991 Sales/Total Sales 35% 29% 36%1991 Profits/Total Profits 39% 35% 26%In 1986, PepsiCo purchased KFC. Combined with Pizza Hut and Taco Bell, the purchase made PepsiCo the international leader in number of restaurant units.In late 1980s, Coca Cola campaign against PepsiCo stating that restaurants that bought syrup from Pepsi-Cola were albeit indirectly, helping one of their toughest restaurant competitors. The result of this campaign cost PepsiCo to lose its Burger King and Wendy's accounts in 1991.All three of PepsiCo's restaurant chains were considered quick service.Pizza HutPepsiCo purchased Pizza Hut in 1977. In 1984, Pizza Hut challenged by Domino's Pizza chain focusing on delivery. As a result, Pizza Hut launched its own delivery business in 1985. In 1988, delivery business accounted for more than one quarter of Pizza Hut's sales growth and half of its profit growth at the store level. Delivery service was the first step toward repositioning of Pizza Hut into pizza distribution. Also expansion into non-traditional loacations like airports, amusement parks, stadiums and school lunch rooms was a key factor in its success.In 1991, Pizza Hut offered two new concepts: quick service and casual dining. Competitors were...

Find Another Essay On PepsiCo's Restaurants

Strategic Management Essay

3498 words - 14 pages . PepsiCo was very famous and successful in almost every product category in North America, therefore it was decided to realign its organisational structure, in order to position the company for continue growth and simultaneously leverage the talents of senior leaders. (Lynch 2009:450).PepsiCo's strategy to build on its strengths in different markets resulted in their decision to combine its international and beverage operations. (Lynch 2009:451

Organizational Behavior of Pepsico Essay

6339 words - 25 pages consuming a PepsiCo beverage.2.5 Service Activities that maintain and enhance a products value include customer support, repair services, installation and training. PepsiCo's customers range from large international retailers and restaurants to smaller independent businesses and vendors. As a result, they provide services tailored to meet their customers' needs.Finally, it can be concluded that the value chain is perfectly aligned to ensure the

Pepsi, Organization-Industry Overview

1224 words - 5 pages division which sells its products worldwide in Europe, Asia, Africa and Australia.One of the key factors leading to PepsiCo's financial success is what they call Performance with Purpose. One of their main missions is to remain financially healthy while being environmentally and socially responsible to the communities they serve. Some of their key missions are revitalizing their North American presence, broadening their global products and expanding

Analysis of Pepsi-cola Co

5648 words - 23 pages dramatically increased PepsiCo's market potential and set the foundation for the company's tremendous growth.Today, Pepsi-Cola Company is a major division of PepsiCo's corporate structure. Pepsi-Cola Company now produces and markets a wide range of beverages to retail, restaurants and food services in more than 191 countries and territories around the world and brings in annual revenue of $10 billion. There are 200 plants in the US and Canada, as well as

Overview of Pepsi and Coca-Cola Paper

1403 words - 6 pages The carbonated beverage decision in the supermarket comes down to the two heavyweights: the flagship products from the PepsiCo Inc (NYSE: PEP) and Coca-Cola Company (NYSE: KO). However, the battle between these brands spans much further than the supermarket shelves. From which brand restaurants stock, to what countries each operates in, this rivalry is all encompassing and global. Instead of a list of countries or restaurant chains, let us take

Creating Strategy: KFC

3097 words - 12 pages Executive SummaryThe fast-food market in the United States was highly competitive and the declining margins in the fast-food chains reflected the increasing maturity in the US fast-food industry. As an alternative to domestic expansion, many restaurants began to expand into international markets. The early entry into international markets placed KFC in a strong position to benefit from international expansion. Latin America was one of the

Write a business report on the 'Kentucky Fried Chicken Corporation (KFC)', one of the world's largest chicken restaurant chain. Include SWOT analysis and Industry & Competition analysis

3749 words - 15 pages Latin America Strategy, which represented a classic internationalization strategy. KFC's early entry into Latin America gave it a leadership position over McDonald's in Mexico and the Caribbean with 438 restaurants in 2000. Mexico, in Latin America could be identified as highly attractive market opportunity for KFC because of the North American Free Trade Agreement (NAFTA), which went into effect in 1994 and created a free-trade zone between


2884 words - 12 pages quarters of its North American volume. The Pepsi/Lipton Tea Partnership, a joint venture of PepsiCo and Unilever N.V., sells tea concentrate to Pepsi-Cola bottlers, and develops and markets ready-to-drink tea products under the Lipton trademark, including Lipton Brisk and Lipton's Iced Tea. PepsiCo's partnership with the Starbucks Corporation develops ready-to-drink coffee products that are sold under the Starbucks Frappaccino trademark and are

'The Cola Wars Continues: Coke and Pepsi in the 21st Century': Competitive Strategy Case Study

4581 words - 18 pages , fairness and integrity in everything we do."PepsiCo's vision is:"To be a responsible corporate citizen and contribute to the quality of life in our communities.Have a responsibility to continually improve all aspects of the world in which we operate - environmental, social, economic - creating a better tomorrow than today.To put into action programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build

Marketing Strategy Analysis of Coca Cola

3197 words - 13 pages customers range from small, independent retailers to large international supermarkets and restaurants chains. The changing needs and requirements must be continually assessed so that Coca-Cola can adapt and remain relevant.CompetitorsOne of Coca-Cola's main competitors is PepsiCo. "In 2005 PepsiCo market capitalisation reached 98.4bn and the market valued rival Coca-Cola at 97.9bn". PepsiCo has reported increases in market capitalisation by 1.23

Marketing Plan for Coca-Cola alcoholic beverage

7210 words - 29 pages symbol that indicates the product contributes to a healthier lifestyle. Promoting healthy lifestyles is part of PepsiCo's purpose statement and they are part of the "America On the Move" coalition, which helps families, individuals, and communities make positive changes to enable a better quality of life. PepsiCo has also collaborated with the National Urban League and the National Council of LaRaz to help promote healthy habits in African

Similar Essays

Pepsi Co Restaurants Essay

2014 words - 8 pages foods (29% of PepsiCo's sales and 35% of its operating profits) and restaurants (36% of PepsiCo's sales and 26% of its operating profits). In the early 1990's PepsiCo's three restaurant chains (KFC, Taco Bell and Pizza Hut) were the leaders in their respective segment. PepsiCo's senior management believes its ability to move people within and across divisions gives PepsiCo a competitive advantage in the restaurant segment. PepsiCo believes their

Coke Vs. Pepsi Essay

2149 words - 9 pages put pressure on its bottling margins. For years, Pepsi operated under the so-called three-legged stool strategy-drinks, snacks, and restaurants (Sellers 26). When Roger Enrico, Chief Executive Officer for PepsiCo, took over he began to examine the corporation. Going on the belief that if you can't make diversification work, give it up. For nearly three years PepsiCo has been undergoing a major strategic transformation. PepsiCo's chairman

Pepsico Case Essay

9562 words - 38 pages -7685, write Harvard Business School Publishing, Boston, MA 02163, or go to No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means-electronic, mechanical, photocopying, recording, or otherwise-without the permission of Harvard Business School. 1 PepsiCo's Restaurants In early 1992, Wayne Calloway, PepsiCo's chairman and CEO, along with

Kentucky Fried Chicken Essay

629 words - 3 pages ; In 1966 Kentucky Fried Chicken went public and was listed on the New York Stock Exchange.· By 1971, KFC had 2450 franchises and 600 company owned restaurants world wide, and was operating in 48 countries.· In 1971, Heublein Inc. acquired KFC. Soon after, conflicts erupted between Colonel Sanders, who was working as a public relations and good will ambassador, and Heublein management over quality control issues and