Pestle Analysis Of Pepsico

ACKNOWLEDGEMENT

Serial No. Contents Page No.
1 Introduction

2 Objective

3 Global Market Share

4 Industrial Overview

5 Operating Leverage

6 Financial Leverage

7 Combined Leverage

8 Comparative Study of Profitability Ratios

9 Conclusion

INTRODUCTION
PEPSICO:
PEPSICO is the second largest food and beverage company in the world in terms of its annual revenue . The main competitors of pepsico in this field are Nestle, Archer Daniels, Coca Cola company and Kraft food. Coca cola being its main rival in the field of beverage production.
Pepsico is a diverse company producing beverages, cereals and snack foods. Beverages field accounts for over $66 billion of their annual revenue (2013). PepsiCo has 18 global mega brands

The Coca-Cola Company (TCCC) only produces concentrate syrup which is then sold to various bottlers throughout the world who hold a Coca- Cola franchise.Its main rival being Pepsico.
In 2010, it was announced that Coca-Cola had become the first brand to top £1 billion in annual UK grocery sales. Its Revenue was US$ 46.854 billion (2013) with a Operating income of $ 10.228 billion and a Net income of $ 8.584 billion. The company has a Total assets worth $ 90.055 billion and Total equity of $ 33.44 billion.

DR PEPPER SNAPPLE GROUP INC:
Dr Pepper Snapple Group, Inc. (DPS) is an integrated beverage brand owner, manufacturer, and distributor of non-alcoholic beverages in the U.S. (89% of sales), Canada (4% of sales), and Mexico and the Caribbean (7% of sales).It is the third largest flavored carbonated drink soft drink in US by ts annual revenue. It has 6 of the top 10 non-cola soft drinks,13 of their 44 leading brands are number 1 and 2 in their flavor categories

Coca cola’s profitability is estimated to increase in 2014 due to greater cost efficiency whereas pepsico’s profitability has decreased in 2013 and is expected to remain thereafter. Dr. Pepper Stapple’s profitability is estimated to decline in 2014 from one time tax benefit as well as increased cost due to advertising.
The Enterprise Profit Margin (EPM) of Pepsico rose from 8.88% in 2012 to 9.31% in 2013.This as mainly due to the cost saving program of the company which saved its 1 billion dollar in 2013.The enterprise asset turnover decreased from 1.44 in 2012 to 1.43 in 2013. Taking the average of EATO from 2010 to 2013 it should rise to 0.13 in 2014.The weighted average capital ratio of pepsi is 5.5% Fig-4.1
Similarly, the EPM of Coca-Cola company is at an increase of around 19.12% for 2014,a 3.71 % incease since 2013. this is due to cost cutting measures that aim to reduce management and data expense.the EATO rises fairly during 2010 to 2013. Fig-4.2
In Dr.Pepper Stapples group sales growth is the main concern. It is approximately zero during 2013 – 2014.it is forecasted to increase in the upcoming years. The profit margin for 2014 is less than the previous two years.