Beverage Division

Pepsi-Cola Company
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Introduction
PepsiCo, Inc., major producer of carbonated soft
drinks, other beverages, and snack foods. Its
beverage division, Pepsi-Cola Company, bottles
and markets several popular brands of soft drinks
in the United States and throughout the world.
PepsiCo also owns Frito-Lay Company, the leading
snack-food maker in the United States. PepsiCo is
based in Purchase, New York.
PepsiCos soft drink products include Pepsi, Diet
Pepsi, and Mountain Dew. Other beverages
include Lipton Brisk and Liptons Brew iced teas,
All Sport athletic drink, and Aquafina bottled
water. Frito-Lay products include Lays and
Ruffles Potato Chips, Fritos and Doritos Corn
Chips, Chee-tos Cheese Snacks, Tostitos Tortilla
Chips, Rold Gold Pretzels, and Grandmas Cookies.

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Early History
PepsiCo traces its origins to 1898 when Caleb
Bradham, a pharmacist in New Bern, North
Carolina, created a curative drink for dyspepsia
called Pepsi-Cola. Pepsi-Cola, later referred to
simply as Pepsi, was a mixture of carbonated water,
cane-sugar syrup, and an extract from tropical kola
nuts. To sell his product, Bradham formed the
Pepsi-Cola Company in 1903. In addition to selling
the drink at drugstore counters, Bradham bottled
Pepsi for sale on store shelves. At this time, bottling
was a new innovation in food packaging.
However, due to major increases in the price of sugar,
Bradham began to lose money on Pepsi, and in 1923 he
filed for bankruptcy. The Craven Holding Company of
Craven County, North Carolina, purchased the
companys assets. In 1931 Charles G. Guth of the Loft
Candy Company in New York City purchased Pepsi-Cola
from the holding company. Guth had difficulty getting
the business going again, but he increased sales by
selling larger bottles at an unchanged price. By 1933
Pepsi-Cola was sold by 313 franchised U.S. dealers;
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bottled in the United States, Cuba, and England; and

sold in 83 countries.
PepsiCos snack-food business dates from 1932 when
ice-cream seller Elmer Doolin of San Antonio, Texas,
developed a business idea after eating a package of
Mexican-made fried corn chips. He purchased a recipe
for the chips and established the Frito Company in
1932. Originally, Doolin produced Fritos corn chips in
his mothers kitchen. He later mechanized production
and moved operations to Dallas, Texas, in 1933.
Lay of Nashville, Tennessee, developed a business
distributing potato chips made by an Atlanta
manufacturer. In 1938
Lay bought the
manufacturing company, renaming it H. W. Lay &
Company.
The company prospered, becoming one of the
largest producers and distributors of snack foods in
the southeastern United States. The company made
and sold many snack foods, but its best-seller was
its brand of potato chips, known as Lays. In 1945
the Frito Company gave H. W. Lay & Company
exclusive Southeast distribution rights for Fritos
corn chips, a market both companies hoped to
expand nationwide.
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After continuing their close business association for

over 15 years, the two companies merged in 1961 to
become Frito-Lay, Inc., with headquarters in Texas.

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Download Project Report on

Total Quality Management
Benchmarking at Pepsi Cola
http://www.managementparadise.com/Aditi707/documents/
11727/project-report-on-total-quality-managementbenchmarking-at-pepsi-cola/

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