MINI PROJECT ON PEPSICO

Name: Muhammad Ahmed

Reg no: 43261
Course: Supply chain Management

Introduction
PepsiCo, Inc. is an American multinational food, snack, and beverage corporation headquartered
in Harrison, New York, in the hamlet of Purchase. PepsiCo has 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 included an acquisition of Tropicana Products in 1998 and the Quaker Oats
Company in 2001, which added the Gatorade brand to its portfolio.
The soft drink Pepsi was developed by Caleb Bradham, a pharmacist and businessman from
Duplin County, North Carolina. He coined the name "Pepsi-Cola" in 1898 while marketing the
drink from his pharmacy in New Bern, North Carolina. As his drink gained popularity, Bradham
founded the Pepsi-Cola Company in 1902 and registered a patent for his recipe in 1903.[4] The
company was incorporated in Delaware in 1919. Bradham's company experienced years of
success leading up to World War I.

Supply chain management and strategies

Pepsico strongly believes in a sustainable business and acts in a way to create a more sustainable
and better shared future. It works to make a difference in the lives of people and communities by
adopting the right way of doing business. They offer a very wide range of products to their
customers and focus on the strategy to have a world without waste. Pepsico implements green
business strategies which includes recycling of bottles, reduction of carbon footprint and water
purity.

Efforts on environmental sustainability

As Pepsico switched to green business in order to attain sustainability, it worked on the reduction
of the energy consumption by the plants used in the manufacture of soda, bottles and packaging.
The company invested hundreds of millions into projects that are energy efficient for example
Combined Heat and Power plants at manufacturing sites .Over a period of 5 years Pepsico was
able to reduce emission and save energy by 30%.
Also the recycling of water as well as the adoption of recyclable plastic for bottles made a huge
change to the company. Water recycling was implemented in a way that the water that has been
used for the cleaning and washing of bottles, is been treated and then further used again for non-
product purposes. It helped Pepsico to attain sustainability during droughts as well. The company
was able to reduce up to 64 % that is more than their expected saving. In addition this project of
Pepsico gets extended into the local communities in the nearby communities.
Whereas the concern of Pepsico about the recycling of bottles ended up on the introduction of
their “Plant bottle” which consist of 30% plant material and has lower carbon footprint. The
earlier used bottles were made up of PET plastic as it is also a recyclable plastic but according to
the previous records only a small percent of these bottles actually get recycled, switching to plant
bottles helped to reduce the pollution of petroleum based PET plastic bottles.
All these initiatives helped the company to have a sustainable business throughout the year,
Shortage of energy or water (i.e. drought situation) will not affect the production of Pepsico’s
products to a major extent .Also these initiatives helped to build a positive impact on the minds
of customers and making its product environment friendly will definitely make a positive change
in sales as well.
Shortcomings of the Strategies
The initiatives taken by Pepsico for a sustainable business brought a number of strengths to the
company, however these strengths required a huge cost. The investment for the implementation
of the above strategies and project was a great challenge as the installment and establishment of
new plants for the manufacturing as well as plants for water recycling and storage and raw
material for the new Plant bottles, all these are very heavy to pocket strategies . Apart from this
the reduction of water in the actual product from 2.3L to 2.0L made a slight difference in the
taste which resulted in the increase of the turnover ratio of its customers. Apart from these, the
newly installed plants consist of new technology and new system, hence the old labor do not
specialize in the operation of the particular technology, therefore a new staff is required or
training sessions for the old labor should be arranged in order to make them professional towards
the newly installed plants and understanding the technology from the scratch in order to tackle
any issue that can be faced in the future regarding the function of plant technology. This became
an obstacle for the company during the implementation of the plant as this requires a huge
amount of financial intake as well as a larger span of time should be invested. All these appeared
as the shortcomings of the strategies implemented in the supply chain of Pepsico for making it a
sustainable business

References:
http://docshare04.docshare.tips/files/31161/311610885.pdf
https://www.thomasnet.com/insights/pepsico-supply-chain/
http://www.managementparadise.com/pongal1990/documents/7790/pepsicos-supply-chain-
management/