Tropicana Pure Premium Orange Juice Analysis - Assignment Example

Section 2: Company Information A. What is the history of your company? 100% Tropicana Pure Premium Orange Juice is marketed by Tropicana Products, Inc., a division of PepsiCo, Inc. (Cu.pepsico.com). PepsiCo, Inc. is one of the biggest food and beverage companies in the world. The company came into being through a merger between Pepsi-Cola Company and Frito-Lay, Inc. in 1965 (Pepsico.com). The genesis of Pepsi-Cola can be traced back to 1898 when pharmacists Caleb Bradham developed the recipe for a cola drink. The drink became immensely popular prompting Bradham to create the Pepsi-Cola Company in 1902. Meanwhile, Frito-Lay, Inc. was established when Frito Company merged with H. W. Lay Company in 1961. At the time of the Pepsi-Cola Company and Frito-Lay, Inc. merger, the main products of the combined company (presently known as PepsiCo, Inc.) were Pepsi-Cola, Diet Pepsi, Mountain Dew, Fritos brand corn chips, Lays brand potato chips, Cheetos brand cheese flavored snacks, Ruffles brand potato chips and Rold Gold brand pretzels. 1. B. How has the company changed throughout its history? Timeline: PepsiCo, Inc. 1898: ‘Brad’s Drink’, created by pharmacist Caleb Bradham was renamed ‘Pepsi‐Cola.’ 1902: Bradham established the Pepsi-Cola Company. 1903: U.S. Patent Office grants a trademark to Pepsi-Cola. The cola drink is positioned as ‘Exhilarating, Invigorating, Aids Digestion.’ 1905: Franchises granted to two independent investors in Charlotte and Durham, North Carolina to bottle Pepsi-Cola. 1907: Number of franchisees increased to 40. 1910: Pepsi-Cola franchisees were operational in 24 states. 1920s: The World War I changed the business environment drastically. Sugar prices fluctuated widely and cost of doing business had increased enormously. 1923: Pepsi-Cola was bankrupt. Bradham sold the Pepsi-Cola trademark to Craven. Holdings Corporation. Stockbroker Roy C. Megargel bought the Pepsi-Cola trademark. 1931: Pepsi-Cola Company declared bankrupt for the 2nd time. Charles G. Guth, president of Loft Incorporated, acquired the Pepsi-Cola trademark. 1930s: International expansion began. 1938: Walter S. Mack appointed president of Pepsi-Cola. Late 1930s: ‘Pepsi & Pete’ comic advertising campaign launched. The ‘Twice as Much for a Nickel’ tag line became immensely popular. 1941: Logo changed; blue, red and white colours incorporated. Changes incorporated to support America’s war efforts. 1950s: Advertising moved from price plank to a lifestyle accompaniment. 1958: Swirl bottle introduced. Pepsi was available in 120 countries. ‘Be Sociable, Have a Pepsi’ theme launched. 1964: Diet Pepsi introduced keeping in mind the changing dietary habits. Pepsi-Cola also acquired Mountain Dew, a regional soft drink. 1965: Pepsi-Cola merged with Frito-Lay, Inc., to form PepsiCo, Inc. The company started operations in Eastern Europe and Japan. 1970: PepsiCo moved its headquarters from New York City to Purchase, New York.   1970s: PepsiCo became pretty dominant and posed a potent challenge to the Coca-Cola Company. The competition between the two behemoth popularly came to be known as the ‘the cola wars.’ PepsiCo launched ‘The Pepsi Challenge’, a groundbreaking international marketing strategy. Pepsi became the single largest-selling soft drink brand in American supermarkets. 1973: Foods International established to market snack foods. (The company was later called PepsiCo Foods International (PFI). The name was finally changed to Frito-Lay International)  1974: Pepsi-Cola became the first U.S. based consumer product to be produced, marketed and sold in the former Soviet Union. 1976: PepsiCo adopted the Code of Worldwide Business Conduct. 1977: PepsiCo acquired Pizza Hut, Inc. 1978: PepsiCo acquired Taco Bell. 1982: Company forayed into China. 1984: Michael Jackson featured in Pepsi’s iconic advertising campaign ‘The Choice of a New Generation.’ PepsiCo’s products were available in nearly 150 countries and territories. 1986: Listed on the Tokyo stock exchange. PepsiCo acquired Mug Root Beer and Kentucky Fried Chicken (KFC). 1989: PepsiCo acquired Walkers Crisps and Smith Crisps. It entered the top 25 of the Fortune 500 ranking. 1990: Acquired controlling stake in Gamesa, Mexicos largest cookie company. 1991: Forged a joint venture (JV) with Unilever to develop and market tea-based drinks. 1994: Inked pact with Starbucks to develop ready-to-drink coffee beverages. 1997: KFC, Pizza Hut and Taco Bell spun off. 1998: PepsiCo acquired Tropicana Products from Seagram Company Ltd. The acquisition was the biggest ever undertaken by the company. 2001: PepsiCo merged with The Quaker Oats Company. 2003: Sierra Mist launched in United States. 2004: First Corporate Citizenship report published by PepsiCo in its 2003 Annual Report. 2006: Indra Nooyi took over as the CEO of PepsiCo. 2007: PepsiCo introduced the ‘Performance with Purpose’ campaign. 2008: Announced plans to invest US $1 billion in China as a part of its strategy to expand in emerging markets. 2009: Forged a strategic alliance with Calbee Foods Company to market food products in Japan. 2010: AMP Energy Juice launched throughout the United States. 2011: Acquired Brazil based Mabel, a renowned manufacturer of cookies, crackers and snacks. 2012: Pepsi Next, the reduced-calorie cola innovation launched. 2013: A high-tech yogurt manufacturing facility opened in New York by Müller Quaker Dairy, a JV between PepsiCo and The Müller Group. 2. What major accomplishments has the company experienced in recent years? List. Accomplishments in 2013 PepsiCo topped the charts in CoreBrands list of the Most Respected Companies. Featured on 37th position on the Fortunes 2013 Worlds Most Admired Companies list. Featured in Ethispheres Worlds Most Ethical Companies for the seventh successive year. Ranked #11 on Hispanic Business 2013 Best Companies for Diversity. CRF Institute recognized PepsiCo as a Top Employer in Europe for the 3rd consecutive year.  Accomplishments in 2012 Featured on ninth position on Reputation Institutes Americas Most Reputable Companies list. Featured in Black Enterprises 40 Best Companies for Diversity. LATINAStyle magazine acknowledged PepsiCo as one of its Top 50 companies for Latinas. Awarded the Stockholm Industry Water Award for innovative water stewardship initiatives. 3. Many large corporations have many divisions/categories of products. List the divisions and under each division list products for that particular division. PepsiCo has four global business units namely PepsiCo Americas Beverages, PepsiCo Americas Foods, PepsiCo Europe and PepsiCo Asia, Middle East & Africa (Pepsico.com). PepsiCo Americas Beverages (PAB) PAB manufactures and markets numerous popular brands including Pepsi-Cola, Mountain Dew, Gatorade, Tropicana Pure Premium, Propel, IZZE and Naked Juice. PAB also sells ready-to-drink teas and coffees through strategic alliances with Starbucks and Unilever. PepsiCo Americas Foods PepsiCo Americas Foods offers popular food and snacks to consumers throughout North and Latin America. The PepsiCo Americas Foods global business unit includes Frito-Lays North America, Quaker Foods North America and Latin America food and snack businesses. The popular food products sold by these divisions include Lay’s, Doritos, Ruffles, Gamesa, Quaker Oats and Sabritas. PepsiCo Europe The PepsiCo Europe global business unit is responsible for selling the company’s beverage, food and snack brands in Europe and South Africa. The major brands sold in these regions include Pepsi, 7UP, Tropicana, Lays, Walkers, Cheetos and Ruffles. PepsiCo Asia, Middle East & Africa (AMEA) PepsiCo AMEA markets various beverages, snacks and food brands in Asia, Middle East & Africa (excluding South Africa). Pepsi, Mirinda, 7UP, Aquafina, Tropicana, Chipsy, Kurkure, Doritos, Cheetos and Smiths are some of the popular brand sold by the AMEA global business unit. 4. What services come with the purchase of your product for the business buyer (your prospect) and the ultimate consumer? PepsiCo is in the food and beverage business. The gamut of services thus falls largely out of the preview of the company. PepsiCo however does provide certain services associated with vending machines, fountain machines and concentrates to the business buyers. The company also performs certain community services. These community services fall under the gamut of corporate social responsibility (Wireless News). 5. Is there a toll-free number or online support for Customer Service for the buyer’s business and buyer’s customers that will offer assistance with questions or problems? The customers can reach PepsiCo officials by phone, by e-mail or by post. PepsiCo has multiple numbers where customers can call for assistance. The number 1-800-237-7799 is specific for queries related to Tropicana while consumers can call 1-800-433-2652 for assistance and questions related to the Pepsi brand. The company also allows the option of on-line chat forums whereby customers can seek clarifications to their queries. PepsiCo is active on the social media and has presence on Facebook and Twitter. The company also has brand specific websites like www.Pepsi.com, www.FritoLay.com, www.QuakerOats.com, www.Tropicana.com and www.Gatorade.com (Pepsico.com). These websites provide rich information about the brands and also carry a separate, brand specific FAQ section. 6. Does your company provide superior technology to ensure fast order fulfilment and quick turnaround from order date to delivery date to the prospect without delays-such as just-in-time inventory delivery software? PepsiCo operates in the highly competitive food and beverages industry. The success in the beverage industry is particularly dependent on the speed and reach of the distribution network. PepsiCo is pretty agile and flexible when it comes to managing a multifaceted distribution system and dynamic logistics. The company has adopted state-of-the-art technology including the iPad to remove distribution bottlenecks and ensure timely delivery of products (Apple.com). PepsiCo has successfully used the direct-to-store model to gain efficiencies on the distribution front (Supplychainbrain.com). Works Cited Apple.com,. Apple - Ipad In Business - Profiles - Pepsico. N.p., 2014. Web. 18 Oct. 2014. Cu.pepsico.com,. Tropicana - Contact Us. N.p., 2014. Web. 15 Oct. 2014. Pepsico.com,. Pepsico Home | Pepsico.Com. N.p., 2014. Web. 15 Oct. 2014. "PepsiCo Foundation Updates on $1.25 Million Investment in School Health and Wellness Programs." Wireless News (2014) ProQuest. Web. 18 Oct. 2014. Supplychainbrain.com,. Direct-To-Store Model Delivers Top-Line Benefits To Pepsi Beverages. N.p., 2014. Web. 18 Oct. 2014. Section 3: Industry Information 1. What is the history of the industry from its inception to today? Till the 1940s consumers used to squeeze out fresh juice at home or purchased canned juice from the market. Taking out juice from raw fruit at home was a tedious process. Consumers considered canned juices as inferior in taste and quality. The need of the hour was to develop a fruit based beverage product that did not spoil quickly and also satiated the taste buds of the consumers. Joint research efforts by the Florida Citrus Commission and the United States Department of Agriculture (USDA) led to the invention of vacuum evaporation process and the formation of frozen concentrated juice in the mid 1940s (Wolf). The concentrated juice provided the much needed convenience to the consumers. Florida Foods (now Minute Maid, owned by the Coca-Cola Company) was a dominant player in the market at that time. In the mid 1960s, Tropicana and Minute Maid started offering orange juice round the year. These companies froze single-strength juice and stored it for thawing, pasteurizing and packaging thus paving the way for ready-to-serve (RTS) segment. The RTS segment grew from 15 percent in late 1960s to 34 percent by late 1970s (University of Florida). The invention of the beverage boxes by Swedish businessman Ruben Rausing in the late1950s and early 1960s is an important milestone in the history of the packaged juice industry. These boxes, made of paper and aluminium, provided an effective medium to store juices in an antiseptic, non-refrigerated medium (Williams). The advent and rise of juice bar chains made the fresh juice industry mainstream in the 1990s. Thereafter smoothies became popular and were served at all leading quick service restaurants (QSRs) including McDonald’s, Burger King and Dunkin’ Donuts (Blumenthal). These drinks represented QSR’s entry into the health food segment and posed as competition to packaged fruit juice (Wolf). While such substitutes threaten to eat into the market share of packaged fruits, the not-from-concentrate (NFC) category of juices has increased its market share considerably. During the last couple of decades, there has been a spike in demand in the packaged juice category. 2. a. What is the size of the total industry in terms of sales? The fruit based beverages fall under the ambit of non-carbonated, non-alcoholic beverage sector. The fruit based beverages can be further categorized as fruit drinks, nectars, concentrates, squashes and fruit juices. The fruit juice can be loose or in packaged form. The worldwide market for juices was pegged at USD 79 billion in 2009 (PR Newswire). The industry was expected to increase at a compounded annual growth rate (CAGR) of 3.4 percent and expected to reach USD 93 billion by the end of 2014 (NPCS Team). The global per capita consumption of fruit and vegetable juices is expected to rise from 10.5 liters in 2012 to 12.4 liters by 2016. Overall, the total volume sales would spike from 73 billion liters to more than 90 billion liters during this period. At present, orange juice is the most popular amongst consumers. Apple juice and cranberry juice fill the second and third slot respectively in the consumer’s preference list of juices (Fdbusiness.com). 2. b. Is the industry growing, declining, flat? The fruit juice industry is registering strong growth rates in Asia and Africa. On the other hand, the sales of fruit juices have fallen or remained static in industrialized countries (Fdbusiness.com). Data from Euromonitor International, a leading consumer research company, reveals that juice sales in the United States have fallen every year since 2007 (Wolf). 3. What are the various macro environmental issues affecting the industry as a whole? The various macro environmental forces like political factors, economic factors, social-cultural factors, technological factors, environmental factors and legal factors affect the fruit juices industry albeit in varying degree of magnitude. Growing health consciousness is expected to be the single most important factor that will propel the sales of packaged fruit juices in the future. There are many other indicators that bode well for the future of the packaged juice industry. Rising incomes, especially in emerging markets like India and China, will provide boost to the industry (Wolf). Market experts opine that manufacturers should strive to roll out high-quality products in order to succeed in the market place. Beverages that have functional ingredients and organic features are likely to find favour with the customers in the future. At the same time, the demanding customers are likely to expect different flavours and lifestyle oriented products from the fruit juice manufacturers. 4. List advancements that have been made in the industry in recent years. The fruit juice industry had made rapid strides in developing new flavours. Gone are the days when only a few variants were available in the marketplace. The present day consumer has numerous options to choose from. The manufactures of packaged fruit juice use high-pressure pasteurization process these days. This process enables retain the natural flavours and nutrients of the raw fruits and vegetables for more than a month (Wolf). The major advancements thus fall under the gamut of juice constituents, packaging material and production processes. Works Cited Blumenthal, Robin. Drink Up!. Online.barrons.com. N.p., 2014. Web. 17 Oct. 2014. Fdbusiness.com. The Markets For Soft Drinks And Fruit Juices Change As A Constant – Focusing On Health | Fdbusiness.Com. N.p., 2014. Web. 15 Oct. 2014.  Hamilton, Alissa. Freshly Squeezed: The Truth About Orange Juice In Boxes | Civil ats. Civil Eats. N.p., 2009. Web. 18 Oct. 2014. NPCS Team. Market Research Report On Packaged Fruit Juices & Drinks In India (Present & Future Potential, Market Insights, Growth Drivers, Opportunities, Industry Size, Porters 5 Forces, Demand Analysis & Forecasts Upto 2017). NIIR PROJECT CONSULTANCY SERVICES, 2014. Print. "Reportlinker Adds Innovations in Fruit and Vegetable Juices: Emerging Opportunities in Premiumization, Sustainability and Positive Health." PR Newswire Oct 19 2010. ProQuest. Web. 15 Oct. 2014. Williams, Mary Therese. "PACKAGING." Food in Canada 71.6 (2011): 24. ProQuest. Web. 18 Oct. 2014. Wolf, Barney. Bringing The Juice. QSR Limited Service, Unlimited Possibilities (2013): n. pag. Print. University of Florida. The U.S. Orange And Grapefruit Juice Markets: History, Development, Growth, And Change. 2013. Print. Read More