1.

INTRODUCTION

PepsiCo Inc. is an American multinational food and Beverage Corporation headquartered

in Purchase, New York, United States, with interests in the manufacturing, marketing and
distribution of grain-based snack foods, beverages, and other products. PepsiCo was
formed in 1965 with the merger of the Pepsi-Cola Company and Frito-Lay, Inc. PepsiCo
has since expanded from its namesake product Pepsi to a broader range of food and
beverage brands, the largest of which includes an acquisition of Tropicana in 1998 and a
merger with Quaker Oats in 2001, which added the Gatorade brand to its portfolio.
Currently brands include Pepsi, Mountain Dew, Sierra Mist, Sobe, AMP Energy, IZZE,
Naked Juice, Propel, MUG and Aquafina.

The company also makes and markets North America’s best-selling ready-to-drink iced
teas and coffees, respectively, via joint ventures with Lipton and Starbucks. From its
humble beginnings over a century ago, Pepsi-Cola has grown to become one of the best
known, most loved products throughout the world.

Ramon L. Laguarta is the Chairman of the Boards of Directors and Chief Executive
Officer of PepsiCo since 2019.  PepsiCo products are enjoyed by consumers more than
one billion times a day in more than 200 countries and territories around the world.

PepsiCo generated more than $67 billion in net revenue in 2019, driven by a
complementary food and beverage portfolio that includes Frito-Lay, Gatorade, Pepsi-
Cola, Quaker and Tropicana. PepsiCo's product portfolio includes a wide range of
enjoyable foods and beverages, including 23 brands that generate more than $1 billion
each in estimated annual retail sales.
2. COMPANY PROFILE

Type : Food & Non-alcoholic beverage

Manufacturer : PepsiCo.

Country of Origin : United States

Founded : New Bern N.C, U.S. (1890)

Founder(s) : Caleb Bradham, Donald M. Kendall

And Herman W. Lay

Headquarters : New York, U.S. R&D headquarters in Valhalla

Key People : Ramon Laguarta (Chairperson and CEO)

Products : Pepsi, Diet Pepsi, Mountain Dew, AMP Energy,

Aquafina, Sierra, IST, SoBe, Starbucks, Lipton,

7UP, Atom, Mirinda, Izze, Tropicana Products,

Copella, Naked Juice, Gatorade, Propel Fitness

Water, Quaker Oats Comapany, Lay’s, Doritos,

Cheetos, Kurkure, Fritos.

Number of Employees : 2, 63,000 (2019)

Net Value : US $ 18.8 Billion

Net Income : US $ 7.31 Billion

3. MISSION AND VISION OF THE COMPANY

3.1 MISSION

CREATE MORE SMILES WITH EVERY SIP AND EVERY BITE

 FOR OUR CONSUMERS: By creating joyful moments through our delicious and
nourishing products and unique brand experiences.

 FOR OUR CUSTOMERS: By being the best possible partner, driving game-
changing innovation, and delivering a level of growth unmatched in our industry.

 FOR OUR ASSOCIATES AND OUR COMMUNITIES: By creating meaningful

opportunities to work, gain new skills and build successful careers, and a diverse
and inclusive workplace.

 FOR OUR PLANET: By conserving nature’s precious resources and fostering a

more sustainable planet for our children and grandchildren.

 FOR OUR SHAREHOLDERS: By delivering sustainable top-tier TSR and

embracing best-in-class corporate governance.

3.2 VISION

BE THE GLOBAL LEADER IN CONVENIENT FOODS AND BEVERAGES BY

WINNING WITH PURPOSE

This reflects our ambition to win sustainably in the marketplace and accelerate our top
line growth, whilst keeping our commitment to do good for the planet and our
communities. It builds on decades of progress we’ve made since PepsiCo was founded in
1965, while setting a firm foundation for a new era of growth and prosperity. To help us
achieve this vision, we’ve defined a new set of aspirations: to become Faster, Stronger,
and Better.
4. HISTORICAL BACKGROUND

The recipe for the soft drink Pepsi was first developed in the 1880s by Caleb Bradham, a
pharmacist and industrialist from New Bern North Carolina. He coined the name "Pepsi-
Cola" in 1898. As the cola developed in popularity, he created the Pepsi-Cola Company
in 1902 and registered a patent for his recipe in 1903. The Pepsi-Cola Company was first
incorporated in the state of Delaware in 1919. The company went bankrupt in 1931 and
on June 8 of that year, the trade mark and syrup recipe were purchased by Charles Guth
who owned a syrup manufacturing business in Baltimore, Maryland. Guth was also the
president of Loft, Incorporated, a leading candy manufacturer, and he used the company's
labs and chemists to reformulate the syrup. He further contracted to stock the soda in
Loft's large chain of candy shops and restaurants, which were known for their soda
fountains, used Loft resources to promote Pepsi, and moved the soda company to a
location close by Loft's own facilities in New York City. In 1935, the shareholders of
Loft sued Guth for his 91 % stake of Pepsi-Cola Company in the landmark case Guth v.
Loft Inc. Loft won the suit and on May 29, 1941 formally absorbed Pepsi into Loft,
which was then re-branded as Pepsi-Cola Company that same year. Loft restaurants and
candy stores were spun off at this time. In the early 1960s, Pepsi-Cola's product lines
expanded with the creation of Diet Pepsi and purchase of Mountain Dew.

In 1965, the Pepsi-Cola Company merged with Frito-Lay, Inc. to become PepsiCo, Inc.
At the time of its foundation, PepsiCo was incorporated in the state of Delaware and
headquartered in Manhattan, New York. The company's headquarters were relocated to
their present location of Purchase, New York in 1970, and in 1986 PepsiCo was
reincorporated in the state of North Carolina.

Between 1990 and 1995, PepsiCo funded The Mac Neil/Lehrer NewsHour on public
television.

Between the late- 1970s and the mid-1990s, PepsiCo expanded via acquisition of
businesses outside of its core focus of packaged food and beverage brands; however it
exited these non core business lines largely in 1997, selling some, and spinning off others
into a new company named Tricon Global Restaurants, which later became known as
Yum! Brand, Inc. PepsiCo also previously owned several other brands that it later sold so
it could focus on its primary snack food and beverage lines, according to investment
analysts reporting on the divestments in 1997. Brands formerly owned by PepsiCo
include: Pizza Hut, Taco Bell, KFC, Hot ' Now, East Side Mario's, D' Angelo Sandwich
Shops Chevys Fresh Max, California Pizza Kitchen. Stolichnaya (via licensed
agreement), Wilson Sporting Goods and North American van Lines. The divestments
concluding in 1997 were followed by multiple large-scale acquisitions, as PepsiCo began
to extend its operations beyond soft drinks and snack foods other lines of foods and
beverages. PepsiCo purchased the orange juice company Tropicana Products in 1998, and
merged with Quaker Oats Company in 2001, adding with it the Gatorade sports drink line
and other Quaker Oats brands such as Chewy Granola Bars and Aunt Jemima, among
other.

In August 2009, PepsiCo made a $7 billion offer to acquire the two largest bottlers of its
products in North America: Pepsi Bottling Group and PepsiAmericas. In 2010 this
acquisition was completed, resulting in the formation of a new wholly owned subsidiary
of PepsiCo, Pepsi Beverages Company. In February 2011, the company made its largest
international acquisition by purchasing a two-thirds (majority) stake in Wimm-Bill-Dann
Foods, a Russian food company that produces milk, yogurt, fruit juices products. When
it acquired the remaining 23% stake of Wimm-Bill-Dann Foods in October 2011,
PepsiCo became the largest food and Beverage Company in Russia. In July 2012,
PepsiCo announced a joint venture with the Theo Muller Group which was named Muller
Quaker Dairy. This marked PepsiCo's first entry into the dairy space in the US.
5. THE EVOLUTION OF A LOGO

(1898: ORNATE TEXT)

In 1898 it was decided to rename Brad’s Drink as Pepsi-Cola. This is the first Pepsi-Cola
to be used. The name of then-new concoction was rendered in a complicated script style
typical of the era.

(1940: STREAMLINING THE ORIGINAL)

This is the last version of the classic Pepsi-Cola script. It’s also on the back of every new
bottle. The script was streamlined as the brand grew, but even the 1940 incarnation felt
like a slicker version of the original.
(1962: THE BOTTLE CAP ERA)

In 1950, the script was placed inside the red, white and blue swirls which featured on the
bottle cap. The bottle cap becomes the part of the logo. The logo was also used in Pepsi
holiday spice in 2004.

(1973: TURNING ABSTRACT)

In 1973 the logo was modernized, the proportions of the swirls have change to a font. The
version evolved the bottle cap into a more abstract background, underscoring the red-
white-and-blue identity.
(1991: PREPARING TO UNCOUPLE)

A redesigned and streamlined logo was used in 1991. First time the Pepsi text was
outside of the swirls. This mark floated the name above its symbol aimed to look
“peppier and younger” than Coke, the New York Times reported.

(TODAY: BEYOND WORDS)

The most recent update, from 2008, converted the wavy center stripe into what is meant
to resemble a smile. This version also serves as Pepsi’s Twitter avatar.

6. LEADERSHIP
RAMON L. LAGUARTA

(Chairman and Chief Executive)

Ramon L. Laguarta is the Chairman of the Board of Directors and Chief Executive
Officer of PepsiCo. PepsiCo products are enjoyed by consumers more than one billion
times a day in more than 200 countries and territories around the world. PepsiCo
generated more than $67 billion in net revenue in 2019, driven by a complementary food
and beverage portfolio that includes Frito-Lay, Gatorade, Pepsi-Cola, Quaker and
Tropicana. PepsiCo's product portfolio includes a wide range of enjoyable foods and
beverages, including 23 brands that generate more than $1 billion each in estimated
annual retail sales.

Ramon, a 24-year PepsiCo veteran, has served as CEO since October 2018, and
Chairman of the Board since February 2019. As Chairman and CEO, he has begun
pivoting the company toward accelerated growth, embracing a new corporate mission—
to Create More Smiles with Every Sip and Every Bite—and adopting a new vision that
captures PepsiCo’s competitive spirit, intense focus, and shared values: to Be the Global
Leader in Convenient Foods and Beverages by Winning with Purpose. “Winning with
Purpose” reflects PepsiCo’s ambition to win sustainably in the marketplace and embed
purpose into all aspects of its business.
To help achieve these aims, Ramon is positioning the company to become Faster,
Stronger, and Better: Faster by being more consumer-centric and investing to accelerate
topline growth and winning in the marketplace; Stronger by transforming its capabilities
and culture; and Better by continuing to integrate Purpose into its business strategy. As
part of this focus on building a Better company, Ramon has spearheaded PepsiCo’s
Beyond the Bottle strategy, which aims to offer consumers a range of great-tasting
beverages, while making the company’s packaging more sustainable and fueling future
growth. This strategy includes Aquafina Water Stations, Pepsi Spire, and the acquisition
of SodaStream, the world's leader in at-home sparkling beverage preparation.

Under Ramon’s leadership, the company is also adopting new leadership behaviors that
are focused on driving high performance and building competitive advantage. These
behaviors include: be consumer-centric; act as owners; focus and get things done fast;
voice opinions fearlessly, raise the bar on talent and diversity; celebrate success; and act
with integrity.

Prior to becoming CEO, Ramon was President of PepsiCo. In this role, he was
responsible for shaping the company’s corporate strategy, working closely with business
units to deliver top-line growth, driving productivity to enable this growth, and investing
in new areas of disruptive innovation. In this capacity he oversaw PepsiCo's Global
Category Groups; its Global Operations, Corporate Strategy, and Public Policy &
Government Affairs functions; and the PepsiCo Foundation.

Between 2015 and 2017, Ramon served as Chief Executive Officer of the sector formerly
known as Europe Sub-Saharan Africa (ESSA), one of PepsiCo’s most complex
businesses, with responsibility for leading the company’s beverage, food and snacks
business in Europe and Sub-Saharan Africa. In that role, he successfully transformed
ESSA’s beverage portfolio, developed the company’s juice business, and advanced the
company’s sustainability mission.
Prior to serving as CEO of ESSA, Ramon held a variety of positions of increasing
responsibility in Europe, including leading the acquisition and successful integration of
the company’s dairy business in Russia. Before joining PepsiCo in 1996, he worked for
Chupa Chups, S.A., a Spanish leading confectionery company, where he held a number
of international roles in Asia, Europe, the Middle East, and the United States.

In addition to being a member of the PepsiCo Board of Directors, Ramon also currently
serves as a director of Visa Inc.

Ramon is a native of Barcelona and holds an MBA from ESADE Business School in
Spain and a Master’s in International Management (M&M) from Thunderbird School of
Global Management. He and his wife, Maria, are the proud parents of three sons.

INDRA NOOYI

(FORMER CHIEF EXECUTIVE)

Indra Nooyi, (born October 28, 1955, Madras [now Chennai], India), Indian-born
American businesswoman who was instrumental in the lucrative restructuring and
diversification of soft-drink manufacturer PepsiCo, Inc.’s brands. Nooyi served as the
company’s CEO (2006–18) and chairman of the board (2007–19).
Nooyi earned a bachelor’s degree in chemistry from Madras Christian College in 1976
and a master’s degree in business administration from the Indian Institute of Management
in Calcutta two years later. After moving to the United States, she received an additional
master’s degree in public and private management from the Yale School of Management
in 1980. For the next six years, Nooyi worked as a consultant for the Boston Consulting
Group. She later held executive positions at Motorola, Inc., and the engineering firm
Asea Brown Boveri (now ABB).

In 1994 Nooyi joined PepsiCo as senior vice president of corporate strategy and
development. In 2001 she was named president and chief financial officer of the
company. Nooyi was responsible for guiding a major restructuring, which included the
company’s spin-off of its restaurants—which included KFC, Pizza Hut, and Taco Bell—
into Tricon Global Restaurants (which later became Yum! Brands, Inc.), as well as the
spin-off of PepsiCo’s bottling operations. In addition, she oversaw the acquisition (1998)
of Tropicana Products and a merger in 2001 with the Quaker Oats Co. as part of the
company’s strategy of diversifying into more healthful drinks and foods.

Nooyi assumed the title of CEO in October 2006 and the next year became chairman of
the board as well. The fifth chairman and CEO in PepsiCo’s 42-year history, Nooyi was
the first woman to lead the soft-drink and snack-food giant and one of only 11 female
chief executives of Fortune 500 companies. Although analysts expressed surprise at the
timing of Nooyi’s appointment as chairman (her predecessor, Steven Reinemund, had
served just five years before abruptly deciding to retire), many praised the skills that she
would bring to the job. Nooyi continued the strategy of making PepsiCo a well-balanced
consumer-products company that was less reliant on sales of its flagship soft drinks. She
also aggressively pursued international expansion.

Under her leadership, PepsiCo’s revenues increased from $35 billion in 2006 to $63.5
billion in 2017. The following year it was announced that Nooyi would be stepping down
as CEO in October and as chairman of the board in early 2019.
7. BRANDS OF PEPSICO

1. PepsiCo

Pepsi is a carbonated soft drink that is produced and manufactured by PepsiCo. Created
and developed in 1893 and introduced as Brad's Drink, it was renamed as Pepsi-Cola on
August 28, 1898, then to Pepsi in 1961, and in select areas of North America, "Pepsi-
Cola Made with Real Sugar" as of 2014. World’s second largest soft drink after coca-
cola.

2. Mountain Dew

Mountain Dew (currently stylized as Mtn Dew in the United States) is a carbonated soft
drink brand produced and owned by PepsiCo. The original formula was invented in 1940
by Tennessee beverage bottlers Barney and Ally Hartman. A revised formula was created
by Bill Bridgforth in 1958. The rights to this formula were obtained by the Tip
Corporation of Marion, Virginia. William H. "Bill" Jones of the Tip Corporation further
refined the formula, launching that version of Mountain Dew in 1961. On August 27,
1964, the Mountain Dew brand and production rights were acquired from Tip by the
Pepsi-Cola company, at which point distribution expanded more widely across the United
States and Canada.

3. Gatorade

The Gatorade Company, Inc. is a manufacturer of sports-themed is verge and food

products, built around its signature line of sports drinks. Gatorade is currently
manufactured by PepsiCo and distributed in over 80 countries. The beverage was first
developed in 1965 by a team of researchers at University of Florida, to replenish the
combination of water, carbohydrates, and electrolytes that the school’s student-athletes
lost in sweat during rigorous athletic competitions.
4. Tropicana beverages

Tropicana Products, Inc. is an American multinational company which primarily makes

fruit-based beverages. It was founded in 1947 by Anthony T. Rossi in Bradenton, Florida.
Since 1998 it has been owned by PepsiCo. Tropicana's headquarters are in Chicago,
Illinois. The company specializes in the production of orange juice.

5. 7Up

7Up is a brand of lemon- lime flavored, non-caffeinated soft drink. The rights to the
brand are held by Dr Pepper Snapple Group in the United States, and PepsiCo (or its
licensees) in the rest of the world. The U.S. version of the 7 UP logo includes a red
cherry between the “7” and "Up", this red cherry has been animated and used as a mascot
for the brand as Cool Spot.

6. Cheetos

Cheetos (formerly called Chee-tos until 1998) is a brand of cheese-flavored, Puffed

cornmeal snacks made by Frito, a subsidiary of PepsiCo. Fritos creator Charles Elmer
Doolin invented Cheetos in 1948, and began national distribution in the U.S. The initial
success of Cheetos was a contributing factor to the merger between The Frito Company
and H.W. Lay & Company in 1961 to form Frito-Lay. In 1965 Frito-Lay became a
subsidiary of The Pepsi-Cola Company, forming PepsiCo, the current owner of the
Cheetos brand.

7. Mirinda

Mirinda is a brand of soft drink originally created in Spain in 1959, with global
distribution. The word Mirinda means "admirable" or "wonderful" in Esperanto. It is
available in fruit varieties including orange, citrus, grape fruit, apple, strawberry,
raspberry, pineapple, pomegranate, banana, passion fruit, guava, tangerine, watermelon
and grape flavors as well as tamarind. A "citrus" flavor is also available in certain areas
of the Middle East. It is part of a beverage area often referred to as the flavor segment,
comprising carbonated and non-carbonated fruit-flavored beverages. The orange flavor of
Mirinda now represents the majority of Mirinda sales worldwide following a major
repositioning of the brand towards that flavor in the early 1990s.

8. PEPSICO STRATEGIES (GENERAL AND INTENSIVE)

8.1 GENERAL STRATEGY

PepsiCo applies different generic competitive strategies, considering the company’s wide
array of products. However, the main generic strategies that contribute to PepsiCo’s
competitive advantage are as follows:

1. Cost leadership

2. Broad differentiation

PepsiCo uses cost leadership as its primary generic competitive strategy. This generic
strategy focuses on cost minimization as a way to improve PepsiCo’s financial
performance and overall competitiveness. For example, to compete against Coca-Cola
products, PepsiCo offers low prices based on low operating costs. The company also
sometimes has special promotional offers with discounted prices. On the other hand,
PepsiCo uses broad differentiation as its secondary generic competitive strategy. This
generic strategy enables business competitive advantage by attracting consumers to some
unique features of the firm’s products. For example, PepsiCo’s Lay’s potato chips are
marketed as a healthful snack product because of reduced saturated fat content. A
strategic objective for the cost leadership generic strategy is to automate production
processes to minimize PepsiCo’s operating costs. In relation, PepsiCo’s strategic
objective for the broad differentiation generic strategy is to innovate products to address
concerns about their health effects.

8.2 PEPSICO INTENSIVE GROWTH STRATEGIES

Market Penetration- PepsiCo implements market penetration as its primary intensive

growth strategy. This intensive strategy supports business growth through increased sales,
such as from a bigger market share. For example, PepsiCo uses aggressive marketing to
attract more consumers. A strategic objective linked to this intensive growth strategy is to
minimize costs and prices to attract more consumers despite market saturation. As such,
PepsiCo’s generic competitive strategy of cost leadership supports this intensive strategy
for growth.

Product Development- PepsiCo’s secondary intensive growth strategy is product

development. This intensive strategy requires offering new products to capture more
consumers. For example, PepsiCo continues to develop products or variants of existing
ones, such as low-calorie, reduced-salt, or low-saturated-fat variants of its food and
beverage products. A strategic objective linked to this intensive growth strategy is to
boost R&D investments for product innovation. PepsiCo’s generic competitive strategy
of broad differentiation supports this intensive strategy by offering unique or novel
products to attract more consumers and grow the business.

Market Development- PepsiCo applies market development as its supporting intensive

growth strategy. This intensive strategy supports business growth by capturing new
markets or market segments. For example, PepsiCo continues to expand its distribution
network to reach the last remaining markets or segments, especially in developing
regions. However, market development is only a supporting intensive growth strategy
because PepsiCo already has significant presence in all regional markets worldwide. A
strategic objective for this intensive strategy is to expand PepsiCo’s supply chain to
support the growth of its distribution network. The cost leadership generic competitive
strategy enables PepsiCo to effectively use this intensive growth strategy through cost
minimization despite additional investments used for expansion to new markets or market
segments.