Pepsi Co Acquisition

In: Business and Management

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Case Analysis for Pepsi Co Acquisition

- More high level analysis (by beverages and food) we are in consumer packaged beverage and snack business

Identify • Vision • Mission - Market leader in every industry they compete in - Synergies (transferring, management, HR skills, distribution channels – i.e. Power of One) - Market expansion (international) - Related diversification (share some of the same channels, advertising, distribution, etc) - There was no clear cut vision ( analysts and CEO even admitted it (looked like they were taking advantages of long term and short term opportunities) - Why do you have a portfolio of businesses? Maximize shareholder value ( would be one of the main drawbacks - Would buy current companies that will help piggy bank on their current success (i.e. restaurants and distribution channels) - Portfolio management – do they sell things off at the right time

Identify Strategic Objectives (Are these objectives SMART)

• Financial o Growth sale by certain percentage o Stock price o Cash • Non-Financial o Efficiency o International market

Identify Current Business Strategy

• Does It Make Sense? Why?

Evaluate

1. Industry • Five Forces – Look at the industry today (*implication to the industry) Rivalry - Big companies manage to find niche and expand it - Little guys usually get bought out from bigger companies - Need to take control/lead of market share - A lot of fresh moves from rivals - A lot of innovation – because rivalry is so competitive - Price cuts ( you don’t see a lot of prices being brought down (relatively stable) - A lot of advertising - Switching costs – none involved, no commitment to the product - A lot of imitation (not too hard…...

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