Pepsico's Frito-Lay North America

PepsiCo’s overall corporate strategy emphasizes product innovation, expansion into international markets, acquisition of other snack food/beverage companies, and maintaining/building close relationship with its supply/value chain. For PepsiCo’s Frito-Lay North America segment, the company is focused on producing more “Better-for-you” and even “Good-for-you” products to market to more health-conscious consumers. The company has made several acquisitions in order to develop a healthier food and beverage lineup. Quaker Foods North America, another of PepsiCo’s business segments, has a strategy that is mainly built upon the segment’s core product, which is its Quaker Oats product line. This business segment is also focused on producing

Through combining beverage, fast-food, and snack-food businesses into one conglomerate, PepsiCo has implemented a strategy that encompasses an excellent opportunity for matching up the different segments value chains, enticing skill transfers, and incurring cost sharing. A great example of a value chain match up that resulted in cost sharing would be the when PepsiCo combined its original carbonated beverage business with other beverage business such as the various juice and tea brands it acquired. These two business share many similarities between value chain activities and were very easy to incorporate into the existing beverage business.

Our team also sees a great opportunity for Pepsi to cross-brand market its Frito-Lay products with its beverage product lines, particularly its carbonated beverage segment. Since these two products are often consumed together, we would expect this marketing to drive additional sales of both products.

Finally, PepsiCo has many opportunities to consolidate supply chains and use knowledge and skills previously gained through its original businesses since most of the companies PepsiCo acquires are still in the same or similar business. Even though PepsiCo is a large company with many products, all of its products target similar customer needs and are manufactured and distributed through similar channels.