Competitive Position of Pepsi - Case Study Example

The paper "Competitive Position of Pepsi" is a great example of a case study on business. The headquarters of PepsiCo, Inc is based in New York, USA. The products of PepsiCo, Inc are sold in at least two hundred countries as well as territories around the globe (Angelkov et al. 2003). This makes it one of the major multinational companies in the beverage industry. The creation of the world-famous beverage started with the combination of spices, juices, and syrups invented by one person as a refreshing drink that beyond all expectations won all hearts and is now one of the most popular beverages in the world.

Since 1965, PepsiCo, Inc. has continued to grow, adding product lines of Mountain Dew, Sierra Mist, Pepsi ONE, and others, and new brands obtained through a partnership with such brands as Lipton Brisk, Starbucks, Aquafina, Dole, and Tropicana juices ((Angelkov et al. 2003). According to the annual report (Annual report, 2013; Biswas and Sen 1999), the company estimates more than two hundred and seventy thousand employees contributing to the activities of PepsiCo around the world. The company has invested the equity of twenty-two billion dollars in order to increase its brands.

The company continues its expansion in such countries as China, Pakistan, Saudi Arabia, Mexico, Brazil, and Turkey, which indicate ten percent of organic revenue growth (Fredrix et al.2009). Table 1.The key financial ratios Margins % of Sales 2014-12 Profitability 2014-12 Revenue 100.00 Tax Rate % 25.11 Gross Margin 53.69 Net Margin % 9.77 Operating Margin 14.37 Asset Turnover (Average) 0.90 EBT Margin 13.13 Return on Assets % 8.80 Financial Leverage (Average) 4.05 Source: (PepsiCo, Inc., 2015) 1.2. Why PepsiCo is interesting According to Goodman (2013), in 2013 the beverages industry grew by three percent and reached its value of almost two billion dollars.

The highest percentage of global beverage industry value is accounted on Europe with its thirty-nine percent. PepsiCo stands here in second place after the Coca-Cola Company. Therefore, the company has much to do to improve its current position in the industry. Thus, the newly reappeared Pepsi Challenge interpreted for the new social media generation of consumers is a new strategic step of PepsiCo that enables more people to hear from the brands they love and the company exploits this mass recognition of its previously successful ideas (Ember & Steel 2015).