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By: Ian Michael Cicero Accounting 4 th Hour 19 April 2012

By: Ian Michael Cicero Accounting 4 th Hour 19 April 2012. Company History and Background.

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By: Ian Michael Cicero Accounting 4 th Hour 19 April 2012

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  1. By: Ian Michael Cicero Accounting 4th Hour 19 April 2012

  2. Company History and Background • PepsiCo, Inc. was founded by Donald M. Kendall, President and Chief Executive Officer of Pepsi-Cola and Herman W. Lay, Chairman and Chief Executive Officer of Frito-Lay, through the merger of the two companies in 1965.

  3. Company History and Background • In 1966 Pepsi enters Japan and Eastern Europe. • Also the slogan becomes, “Come alive! You’re in the Pepsi generation.”

  4. Milestone • PepsiCo sales pass the $1 billion mark in 1973. • PepsiCo moves from New York City to new world headquarters in Purchase, New York.

  5. Pepsi Takes On Food • Foods International, later called PepsiCo Foods International (PFI) and subsequently named Frito-Lay International, is established to market snack foods around the world in 1976.

  6. A Way To Increase Sales • The Pepsi Challenge, introduced in Dallas, Texas in 1975, becomes a national campaign. Around the nation, consumers select Pepsi-Cola as the best tasting cola. • PepsiCo adopts Code of Worldwide Business Conduct.

  7. Another Acquisition • PepsiCo acquires Pizza Hut, Inc. • Also acquire Taco Bell. • PepsiCo stock splits three-for-one.

  8. Main Focus • In 1984 PepsiCo is restructured to focus on its three core businesses: soft drinks, snack foods and restaurants. Transportation and sporting goods businesses are sold.

  9. Pepsi Moving Forward • By 1985 PepsiCo is now the largest company in the beverage industry. The company has revenues of more than $7.5 billion, more than 137,000 employees. • Pepsi-Cola products are available in nearly 150 countries and territories around the world. Snack food operations are in 10 international markets.

  10. Pepsi Is Getting Big $$$ • Pepsi reaches all time highs in all categories of the business. • The ever growing PepsiCo takes on numerous drinks, snacks, and business to add to it’s growing empire.

  11. Today… • In the year 2012, Pepsi has over 285,000 employees. • Pepsi is the world leader in convenient snacks, food, and beverages with revenue over $60 billion.

  12. Headquarters… • Today, Pepsi’s headquarters is in Purchase, New York. • The new corporate headquarters feature a building by one of America's foremost architects, Edward Durrell Stone, set on a campus of 144 acres amid an outdoor sculpture garden.

  13. In The Business Of… • PepsiCo is in the business of producing, distributing, and buying beverages, snacks, and other businesses. • Pepsi’s main source of income is the snack and beverage industry.

  14. Products… • Pepsi Brands include Frito Lay, Tropicana Juice Products, Quaker Brands, and Gatorade. • Frito Lay Products include Tostitos, Doritos, Lays Chips, and Flat Earth Snacks. • Quaker Brands include Aunt Jemima, Rice-A-Roni, Near East side dishes, Spudz snacks, and Crisp'ums baked crisps. • Quaker Breakfast Cereal Brands include, Life, Puffed Wheat, Harvet Crunch, King Vitamin, Quaker Oh's!, Mother's Cereal, and Cap'n Crunch. • Gatorade Brands include G2, and Propel Fit Water. • Pepsi's SoftDrink Brands include Pepsi, Diet Pepsi, Pepsi Max, Mountain Dew, Diet Mountain Dew, Mountain Dew Voltage, Sierra Mist, and Diet Sierra Mist.

  15. Stock Info… • Today’s Price: $66.21 • Historical High: In 2007 stock prices got to $78.26 per share. • Historical Low: In 1990 the stock price was $13.31 • Dividend Amount: 3.11%

  16. My Understanding… • From what I have seen and read I have come to the conclusion of what dividends are. I now see that the earnings of a company must be distributed to the stockholders. When a company is doing well, the people who have stock in that company also receive a financial gain. When the company is doing bad, the stockholders take a financial loss.

  17. S.W.O.T. Analysis • “S”, stands for strengths of the company. • “W”, stands for weaknesses in the company. • “O”, stands for opportunities for future growth or areas that have not been explored. • “T”, stands for threats to the profitability and growth of the business.

  18. Strengths… • Three strengths of Pepsi are: • Brand strength • Effective stride in new markets • Strong existing distribution channels

  19. Strength Explanations • Pepsi has brand strength due to the vast amount of products they have. They sell snacks, beverages, and merchandise with their logo on it. • Pepsi has a effective stride in new business because of the empire they have built. • Pepsi has strong distribution channels because they have a trusted name that has been around for a long time.

  20. Weaknesses… • Three weaknesses of Pepsi are: • Reliant upon carbonated drinks • Entrance into difficult non care categories • Pepsi can cause health problems

  21. Weakness Explanation • Pepsi’s business is reliant upon carbonated drinks. If those drinks go bad, they must be thrown out and that is a financial loss. • Pepsi sometimes makes bad business decisions and invests into products that do not make it. • If a person drinks Pepsi every day for a long time they can develop serious health conditions.

  22. Opportunities… • Three opportunities for Pepsi are: • New product introductions • Brand is attractive to global partners • With growing business comes jobs

  23. Opportunities Explanation • Pepsi is a ever growing company that will always be inventing and investing in new products. • The brand is well known and attractive to global partners which will increase revenue. • Pepsi’s growing business will always need people to fill job positions.

  24. Threats… • Three threats of Pepsi are: • Strong competition • Potential health issues • Free trade

  25. Threat Explanation • Pepsi is a major company with many competitors. In a field where there is many competitors there will always be high competition. • Drinking Pepsi on a regular basis for several years can cause health issues. • Free trade is a problem among Pepsi products because they are shipped all around the world and are at risk of being unprotected.

  26. Recommendation… • In my opinion I would not buy stock right now in PepsiCo. The price per share is high right now and it is steadily going up. I would defiantly recommend waiting for the stock price to come down and then buy. But, if you have the money to spend now on the shares, I would buy because it appears that the stock of Pepsi is rising.

  27. Works Cited • http://www.pepsico.com/Company/Our-History.html • http://studio-5.financialcontent.com/investplace/quote?Symbol=PEP • http://www.docstoc.com/docs/10545397/Pepsi-Marketing-Report • http://www.pepsico.com/Investors/Stock-Information/Historical-Price-Lookup.html

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