Question 1:Question 1: What is What is PepsiCo’s corporate strategy?PepsiCo’s corporate strategy?

PepsPepsiCo iCo was was the the worworld’s largesld’s largest t snacsnack k and and bevbeveragerage e comcompanypany. . MorMore e exaexactlctly y the the comcompanypany’s’s

corporate strategy had diversified the company into salty and sweet snacks, soft drink, orangecorporate strategy had diversified the company into salty and sweet snacks, soft drink, orange

 juice,  juice, bottlebottled d waterwater, , ready ready to to drink drink tea tea and and coffee.coffee... .. About About picking picking new new industrindustries ies to to enter enter andand

deciding on the mean of entry, PepsiCo used related diversification through acquisition and merger deciding on the mean of entry, PepsiCo used related diversification through acquisition and merger 

to quicker launch a brand-new operation, hurdle entry barrier as acquiring technology knowhow,to quicker launch a brand-new operation, hurdle entry barrier as acquiring technology knowhow,

establish supplier relationships, match rival’s efficiency… and to move directly to the task of establish supplier relationships, match rival’s efficiency… and to move directly to the task of 

 building a strong mar building a strong market position. As early as 1968, the company began to pursue growth througket position. As early as 1968, the company began to pursue growth throughh

acquisition outside snacks and beverages. A list of acquisition is 1977 acquisition of Pizza Hut,acquisition outside snacks and beverages. A list of acquisition is 1977 acquisition of Pizza Hut,

1978-tacobell. 1986-Kentucky Fried Chicken, Mug root beer, &UP international, Smartfood ready1978-tacobell. 1986-Kentucky Fried Chicken, Mug root beer, &UP international, Smartfood ready

to eat popcorn, Walker’s Crisps, Smith’s Crisps, Mexican cookie…to eat popcorn, Walker’s Crisps, Smith’s Crisps, Mexican cookie…

Briefly identify the business strategies that PepsiCo is using in each of its consumer businessBriefly identify the business strategies that PepsiCo is using in each of its consumer business

segmentssegments..

The company was organized into four business division, which all followed the corporation’sThe company was organized into four business division, which all followed the corporation’s

general strategic approaches:general strategic approaches:

Fristo-Lay North America: the business strategy for this Fristo-Lay North America: the business strategy for this segmentsegment

The first thing need to consider is how PepsiCo provide convenience to its customer over time withThe first thing need to consider is how PepsiCo provide convenience to its customer over time with

its product. For example, they produce snacks packaged in smaller bags to address the overeatingits product. For example, they produce snacks packaged in smaller bags to address the overeating

concerns and were additionally convenience to take along on an outing. The convenience foodsconcerns and were additionally convenience to take along on an outing. The convenience foods

included both salty and sweet snacks. Going abreast with the more conscious about nutritional andincluded both salty and sweet snacks. Going abreast with the more conscious about nutritional and

healhealthy contentthy content, , FLNFLNA A proprovidevides s betbetter for ter for you and you and googood d for you for you snasnacks. They improvcks. They improve e thethe

 perfor performance mance of of the the divisidivision’s on’s score score salty salty brands brands and and furthefurther r developideveloping ng health health and and wellnewellnessss

 producta productas s a a key key stratestrategic gic action. They action. They offereoffered d fruit and fruit and vegetablvegetable e snacks which snacks which is is deficiedeficientcy ntcy inin

most dietsmost diets

PesiCo Beverages North AmericaPesiCo Beverages North America

For PepsiCFor PepsiCo carbonated soft drino carbonated soft drinks businessks business, PepsiCo use “Power of one” which is a strateg, PepsiCo use “Power of one” which is a strategy y for for 

supermarkets to place Pepsi and Frito –Lay products on shelves. Not only that, they try to improvesupermarkets to place Pepsi and Frito –Lay products on shelves. Not only that, they try to improve

the local distribution, the information flow coming from retailer through “Innovation Summits”.the local distribution, the information flow coming from retailer through “Innovation Summits”.

LastlLastly, they y, they enhanced the nutritionaenhanced the nutritional properties of soft drink with attempt to develop new l properties of soft drink with attempt to develop new types pf types pf 

sweeteners that would lower the clorie content of nondiet drinks. In other hand, for PepsiCo’s nonsweeteners that would lower the clorie content of nondiet drinks. In other hand, for PepsiCo’s non

carcarbonabonated ted BevBeveragerages es BraBrands, nds, PepsPepsiCo iCo offeoffered red healhealthiethier r bevebeveragerages s liklike e –fla–flavor vor and and vitvitaminamin

enriched water...enriched water...

PepsiCo InternationalPepsiCo International

Applied the global strategy, PepsiCo sale of beverage in international market utilize using “Power Applied the global strategy, PepsiCo sale of beverage in international market utilize using “Power 

of One Strategy “ with a modification for snack foods international to suit the different formof One Strategy “ with a modification for snack foods international to suit the different form

country to countrycountry to country

Quaker Foods North AmericaQuaker Foods North America

PepsiCo tried to enhance the quality of product while diversifying the product’s categories with hotPepsiCo tried to enhance the quality of product while diversifying the product’s categories with hot

and ready to eat cereals, pancake mixes and syrup, and rice and pasta side dishes….and ready to eat cereals, pancake mixes and syrup, and rice and pasta side dishes….

QueQuestistion on 2: 2: WhWhat at is is yoyour ur assassessessmenment t of of ththe e lonlong-tg-term erm attattracractivtiveneeness ss of of ththe e inindusdustritrieses

represented in PepsiCo’s business portfolio?represented in PepsiCo’s business portfolio?

Industry AttractivenessIndustry Attractiveness

MeasureMeasure

weight weight beverage beverage cereal cereal snack snack 

MMaarkrket et sisize ze anand d pprorojejecctetedd

growth rategrowth rate

0.2 80.2 8 1.601.60 66 1.201.20 77 1.401.40

Intensity Intensity of of Competition Competition 0.15 0.15 99 1.351.35 88 1.201.20 77 1.051.05

EmeEmerginrging g OpOpporportuntunitiities es andand

threatsthreats

0.15 60.15 6 0.900.90 66 0.900.90 66 0.900.90

Resource Resource Requirements Requirements 0.15 0.15 99 1.351.35 77 1.051.05 77 1.051.05

Societal Political, Regulatory &Societal Political, Regulatory &

Environmental factorsEnvironmental factors

0.05 80.05 8 0.400.40 88 0.400.40 88 0.400.40

Industry Industry Profitability Profitability 0.25 0.25 88 2.002.00 66 1.501.50 77 1.751.75

IInndduussttrry y UUnncceerrttaaiinntty y &&

Business Risk Business Risk 

0.05 80.05 8 0.400.40 77 0.350.35 77 0.350.35

TOTALS 1TOTALS 1 8 8 6.6 6.6 6.96.9

Since all of the industries holding by PepsiCo is cored more than 5, so they pass the attractivenessSince all of the industries holding by PepsiCo is cored more than 5, so they pass the attractiveness

test as a whole.test as a whole.

What is your assessment of What is your assessment of the competitive strength of PepsiCo’s different business units?the competitive strength of PepsiCo’s different business units?

Competitive StrengthCompetitive Strength

MeasureMeasure

WeighWeigh

tt

Frito-LayFrito-Lay

N.A inN.A in

snack snack 

industryindustry

Pepsi N.APepsi N.A

inin

beveragebeverage

industryindustry

PepsiPepsi

International inInternational in

snack, cereal &snack, cereal &

beveragebeverage

industriesindustries

Quaker N.AQuaker N.A

in cerealin cereal

industryindustry

RReellaattiivve e MMaarrkkeet t sshhaarree 00..1155 88 1.201.20 77 1.051.05 55 0.750.75 55 0.750.75

Costs relative toCosts relative to

competitors' costscompetitors' costs

00..1155 77 1.051.05 88 1.201.20 55 0.750.75 66 0.900.90

Ability to match orAbility to match or

beat rivals on keybeat rivals on key

product attributesproduct attributes

00..1100 99 0.900.90 77 0.700.70 66 0.600.60 55 0.500.50

Ability to benefit fromAbility to benefit from

strategic fits withstrategic fits with

sister businesssister business

00..1100 88 0.800.80 88 0.800.80 66 0.600.60 44 0.400.40

Barraging leverageBarraging leverage

with supplierswith suppliers

buyers calibre of buyers calibre of 

alliancealliance

00..1100 99 0.900.90 66 0.600.60 66 0.600.60 33 0.300.30

Brand image andBrand image and

reputationreputation

00..1100 1100 1.001.00 99 0.900.90 77 0.700.70 55 0.500.50

CompeCompetitively titively valuablevaluable

capabilitiescapabilities

00..1100 88 0.800.80 88 0.800.80 55 0.500.50 55 0.500.50

Profitability relative toProfitability relative to

competitorscompetitors

00..2200 99 1.401.40 88 1.601.60 44 0.800.80 55 1.001.00

TotalTotal 88..4455 77..6655 55..33 44..8855

Since the Frito-LaySince the Frito-Lay N.A in s N.A in snack indunack industry, Pestry, Pepsi N.A psi N.A in beverin beverage indusage industry have ttry have the score he score of of 

competitive strength rating above 6.7 so they are strong market contender in the industry. Thecompetitive strength rating above 6.7 so they are strong market contender in the industry. The

other 2 which is Pepsi International in snack, cereal & beverage industries and Quaker N.A inother 2 which is Pepsi International in snack, cereal & beverage industries and Quaker N.A in

cereal industry have the score in the 3,7-6,7 range so they have moderate competitive strengthcereal industry have the score in the 3,7-6,7 range so they have moderate competitive strength

comparing to other rivals.comparing to other rivals.

What does What does a a 9-cell industry attractivene9-cell industry attractiveness/busiss/business strength ness strength matrimatrix x displayidisplaying ng PepsiCoPepsiCo’s ’s businesbusinesss

units look like?units look like?

So Fristo-Lay N.A, PepsiCo NA and PepsiCo international are for growth and built base on their So Fristo-Lay N.A, PepsiCo NA and PepsiCo international are for growth and built base on their 

 big siz big size and high le and high level of inevel of industry dustry attractattractive. Besiive. Besides, Quakedes, Quaker N.A is r N.A is for mafor maintain, haintain, harvestrvesting baseing base

on their average industry attractive and relative market size comparing to other industryon their average industry attractive and relative market size comparing to other industry

Question 3: Does PepsiCo’s portfolio exhibit Question 3: Does PepsiCo’s portfolio exhibit good strategic fit?good strategic fit?

Yes,they had a noteworthy successes with $160 million cost saving from product ingredients andYes,they had a noteworthy successes with $160 million cost saving from product ingredients and

 packing  packing matermaterial, ial, $40 $40 millimillion on cost cost saving saving form form joint joint venture. venture. PepsiCoPepsiCo’s ’s managemmanagement ent team team waswas

dedicated to capturing the strategic fit benefits within the business line up throughout the valuededicated to capturing the strategic fit benefits within the business line up throughout the value

chain. The company’s procurement activities were coordinated globally to achieve the greatestchain. The company’s procurement activities were coordinated globally to achieve the greatest

 possibl possible e economieeconomies s of of scale, scale, best best practicepractices. s. They They also also share share marketemarketed d researresearch ch informinformation ation toto

 better e better enable each dnable each division ivision to develto develop new proop new productduct

What value-chain match-ups do you see?What value-chain match-ups do you see?

they combine purchasing activities, gain more leverage with suppliers, and realize supply chainthey combine purchasing activities, gain more leverage with suppliers, and realize supply chain

ececonoonomimieses; ; shashare re tetechnchnoloologygy, , trtransansfefer r tetechnchnicaical l skskilillsls, , comcombibine ne R&R&D; D; comcombibine ne sasaleles s andand

marmarketketing ing actactivitivitiesies, , use use comcommon mon disdistritributibution on chanchannelnels, s, brabrand nd namname, e, and and comcombine bine aftafter-er-salsalee

service activities and usingcross-business collaboration to create new competitive capabilities.service activities and usingcross-business collaboration to create new competitive capabilities.

What opportunities for skills transfer, cost sharing, or brand sharing do you see?What opportunities for skills transfer, cost sharing, or brand sharing do you see?

I believe that PepsiCo have the all 3 opportunities. For skill transfer, since PepsiCo include muchI believe that PepsiCo have the all 3 opportunities. For skill transfer, since PepsiCo include much

of business units and divisions, they can have skill transferring within the own corporate and theof business units and divisions, they can have skill transferring within the own corporate and the

globe. The best practices were routinely transferred between its 230 plants, 3600 distributionglobe. The best practices were routinely transferred between its 230 plants, 3600 distribution

systems, and 120,000 service routes around the world. For cost sharing, since PepsiCo can capturesystems, and 120,000 service routes around the world. For cost sharing, since PepsiCo can capture

the strategic fit and resources fit benefits, they also prove to have cos-saving over time. Like, theythe strategic fit and resources fit benefits, they also prove to have cos-saving over time. Like, they

achiachieve eve $160 $160 milmilliolion n in in costcost-sav-saving ing resresultulting ing frofrom m corpcorporatorate-we-wide ide procprocureurement ment of of prodproductuct

ingredients and packaging material. And for Brand Sharing, we have to mention one of the mostingredients and packaging material. And for Brand Sharing, we have to mention one of the most

successful strategies was “Power of One”, they allow PepsiCo to obtain the synergistic benefit of successful strategies was “Power of One”, they allow PepsiCo to obtain the synergistic benefit of 

combining Pepsi-Cola and Frito-Lay. For instance, in Chile, Frito-Lay has over 90% of the market,combining Pepsi-Cola and Frito-Lay. For instance, in Chile, Frito-Lay has over 90% of the market,

 but Peps but Pepsi is in li is in lousy shape ousy shape but due tbut due to Frito-o Frito-Lay imaLay image Pepsi ge Pepsi able to gable to get a shelet a shelf space.f space.

Does PepsiCo’s portfolio exhibit good resource fit? What are the cash flow characteristics of Does PepsiCo’s portfolio exhibit good resource fit? What are the cash flow characteristics of 

eaceach h of of PePepsipsiCoCo’s ’s fofour ur segsegmementsnts? ? WhWhich ich bubusinsinessesses es arare e the the strstrongongest est cocontrntribuibutortors s toto

PepsiCo’s free cash flows?PepsiCo’s free cash flows?

Yes, PepsiCo’s portfolio exhibit goodYes, PepsiCo’s portfolio exhibit good

rreessooururce ce ffiitt. . OOvveerralall l bbuussiinenessss’s’s

sisitutuatatioion n is is googood. d. TheThere re is is no no CaCashsh

HHogogs s aannd d DDogog. . FFrritito-o-LLaay y iis s tthehe

strstrongeongest st cascash h genegeneraterated d busibusiness unit ness unit and and PepsPepsi i InteInternatrnationaional l is is lesless s effefficieicient nt busbusinesiness s unitunit

(revenue/profit/asset)(revenue/profit/asset)

BasBased ed on on the precedithe preceding ng anaanalysilysis, s, whawhat t is is your overayour overall ll evaevaluatluation ion of of PepPepsiCosiCo’s ’s busibusinessness

portfolio? Does the portfolio provide the company’s shareholders with an opportunity forportfolio? Does the portfolio provide the company’s shareholders with an opportunity for

above-average market returns?above-average market returns?

Since there is no cash hogs which will erode all of the cash flow using to fund their expansion, or Since there is no cash hogs which will erode all of the cash flow using to fund their expansion, or 

no Dog which also hurt the cash flow of PepsiCo. All of business units are in its good condition,no Dog which also hurt the cash flow of PepsiCo. All of business units are in its good condition,

thethey y can can genegenerate enough rate enough cascash h floflow w for for thethemsemselves and lves and alsalso o for for supsupportporting ing otheother r operoperatiatingng

activities. With the company’s business portfolio’s growth and more than sufficient cash-flow,activities. With the company’s business portfolio’s growth and more than sufficient cash-flow,

PepsiCo is expected to generate above average market return for now, but in the future if it want toPepsiCo is expected to generate above average market return for now, but in the future if it want to

keep it’s position and profitability, there will need funding to build its business unit further not justkeep it’s position and profitability, there will need funding to build its business unit further not just

stop and be satisfy with what it own right now.stop and be satisfy with what it own right now.

2004 2005 2006 20072004 2005 2006 2007

NeNet t CasCash h PrProvidovided ed byby

operating activitiesoperating activities

5,054 5,852 6,084 6,9345,054 5,852 6,084 6,934

Capital SpendingCapital Spending (1,387) (1,736) (2,068) (2,430)(1,387) (1,736) (2,068) (2,430)

Sale of Sale of propproperty, planterty, plant

and equipmentand equipment

38 88 49 4738 88 49 47

ManaManagemengement t operaoperatingting

cash flowcash flow

3,7053,705 4,2044,204 4,0654,065 4,5514,551

Question 4: What strategic actions should Indra Nooyi take to sustain the corporation’sQuestion 4: What strategic actions should Indra Nooyi take to sustain the corporation’s

impressive financial and market performance? Should its free cash flows be used to fundimpressive financial and market performance? Should its free cash flows be used to fund

adadditditioional nal shashare re reprepururchchase ase plplansans, , papay y highigher her divdivideidendsnds, , mamake ke acacquiquisitisitionons, s, expexpanandd

internationally, or for other purposes? What other strategic actions should be pursued byinternationally, or for other purposes? What other strategic actions should be pursued by

corporate level management?corporate level management?

PepsiCo has used very successfully the related diversification corporate strategy as their basicPepsiCo has used very successfully the related diversification corporate strategy as their basic

approach. PepsiCo should remain their related activities within the value chain between the variousapproach. PepsiCo should remain their related activities within the value chain between the various

 beverag beverage and snack food brands to utilie and snack food brands to utilize the strategze the strategic fit and resources fit in ordeic fit and resources fit in order to reduce costsr to reduce costs

and increase profitand increase profits. s. Some of the elements of the value chain should be considered is marketingSome of the elements of the value chain should be considered is marketing,,

 proces processing, research sing, research and and developmdevelopment. ent. An An importimportance noting ance noting here is here is that, PepsiCo that, PepsiCo should defineshould define

clearly their priority in order to have a proper decision making and resources allocation. Besideclearly their priority in order to have a proper decision making and resources allocation. Beside

form what is mentioned above, if the company cash flow is enough to pursuing more, then PepsiCoform what is mentioned above, if the company cash flow is enough to pursuing more, then PepsiCo

should go after some other option like fund additional share repurchase plans, pay higher dividendsshould go after some other option like fund additional share repurchase plans, pay higher dividends

and buying security, investing in mutual fund… to strengthen their financial performance andand buying security, investing in mutual fund… to strengthen their financial performance and

secure its profit again rivals.secure its profit again rivals.

Based on the videos we watched, what strategic actions is Indra Nooyi taking to sustain theBased on the videos we watched, what strategic actions is Indra Nooyi taking to sustain the

ccoorrpoporaratitionon’s ’s imimpprresessisivve e fifinnaancnciaial l aannd d mmaarrkeket t ppererffoormrmaanncce? e? AlAlsoso, , wwhhaat t dodoeses

“sustainability“sustainability” mean ” mean to Indra Nooyi at to Indra Nooyi at PepsiCoPepsiCo

According to the video, with some change and modification, Indra Nooyi had taken an initiate toAccording to the video, with some change and modification, Indra Nooyi had taken an initiate to

resrestrutructucture re the the busbusinesiness, s, he he creacreated ted the the new new 3-d3-divisivision ion strstructuucture re whicwhich h is is PepPepsiCsiCo o AmeAmericricaa

Beverage, PepsiCo America Food and PepsiCo International. Further detail, PepsiCo AmericaBeverage, PepsiCo America Food and PepsiCo International. Further detail, PepsiCo America

Food include 3 units - Frito-Lay North America, Quaker Foods North America, Latin AmericaFood include 3 units - Frito-Lay North America, Quaker Foods North America, Latin America

Foods, and PepsiCo International includes UK & Europe, Middle East, Africa & AsiaFoods, and PepsiCo International includes UK & Europe, Middle East, Africa & Asia

“Sustai“Sustainabilitynability” ” is defined is defined as "Performance with Purpose”. With as "Performance with Purpose”. With the consideratthe consideration ion that customersthat customers

now combine the own rules, value and principle with the purchasing decision. Consequently,now combine the own rules, value and principle with the purchasing decision. Consequently,

PepsiCo tried to join purpose and performance in to one. Three specific aspects of PerformancePepsiCo tried to join purpose and performance in to one. Three specific aspects of Performance

with Purpose is presented. First, offering foods and beverages with social responsibility to providewith Purpose is presented. First, offering foods and beverages with social responsibility to provide

good nourishment to not only customers but also societies is executed. Second, there is a missiongood nourishment to not only customers but also societies is executed. Second, there is a mission

to minimize the company’s operating impact on to minimize the company’s operating impact on the surrounding environmthe surrounding environment. And third, ent. And third, creatingcreating

a safe, healthy and inclusive environment where the best people want to work is lead by PepsiCo’sa safe, healthy and inclusive environment where the best people want to work is lead by PepsiCo’s

management and participated by the company’s employees.management and participated by the company’s employees.

What recommendations would you make to Indra Nooyi and her management team as theyWhat recommendations would you make to Indra Nooyi and her management team as they

expand globally around the world?expand globally around the world?

First, since PepsiCo prove its current Strategy to develop the company is effective, they shouldFirst, since PepsiCo prove its current Strategy to develop the company is effective, they should

remremain ain and and purpursue sue it it resrestlestless. s. As for As for inteinternatrnationaional l marmarketket, , comcompany can pany can contcontinue with inue with thethe

multinational strategy to earn every benefit while implementing global strategies and executingmultinational strategy to earn every benefit while implementing global strategies and executing

marmarketketing ing and and disdistritributbution ion simsimilailarly rly in in all all regregionsions. . FurFurtherther, , PepsPepsiCo iCo neeneed d to to recreconsionsider der thetheir ir 

corporate strategy within their international markets to ensure they are able to increase their marketcorporate strategy within their international markets to ensure they are able to increase their market

share as well as the company growth throughout their sectors. Also, revalue the growth andshare as well as the company growth throughout their sectors. Also, revalue the growth and

attractive at the some countries to pull out from country with sluggish growth with low marketattractive at the some countries to pull out from country with sluggish growth with low market

share, decreashare, decreasing sale… sing sale… About the R&D, first PepsiCAbout the R&D, first PepsiCo need to o need to acquire more markeacquire more market informatiot informationn

to better enable each division to develop new product. From there, they can continue pursuingto better enable each division to develop new product. From there, they can continue pursuing

 product i product innovation nnovation to account to account for the hefor the healthy tralthy trend and socend and social resial responsibilponsibility receity recently.ntly.

Question 5: Conduct a financial analysis using the template provided on Beach-board. WhatQuestion 5: Conduct a financial analysis using the template provided on Beach-board. What

does the financial information reveal about the company’s success and performance duringdoes the financial information reveal about the company’s success and performance during

the 2001-2010 years?the 2001-2010 years?

Year (NumbersYear (Numbers

in $Mil)in $Mil)

22000011 22000022 22000033 22000044 22000055 22000066 22000077 22000088 22000099 22001100

RReevveennuuee $$2233,,551122..00 $$2255,,111122..00 $$2266,,997711..00 $$2299,,226611..00 $$3322,,556622..00 $$3355,,113377..00 $$3399,,447744..00 $$4433,,225511..00 $$4433,,223322..00 $$5577,,883388..00

CCOOGGSS $$1100,,775500..00 $$1111,,449977..00 $$1122,,337799..00 $$1133,,440066..00 $$1144,,117766..00 $$1155,,776622..00 $$1188,,003388..00 $$2200,,335511..00 $$2200,,009999..00 $$2266,,557755..00

SSGG&&AA $$88,,118899..00 $$88,,552233..00 $$99,,446600..00 $$1100,,229999..00 $$1122,,331144..00 $$1122,,771111..00 $$1144,,119966..00 $$1155,,448899..00 $$1144,,661122..00 $$2222,,332266..00

OperatingOperating

IncomeIncome

$$44,,002211..00 $$44,,773300..00 $$44,,778811..00 $$55,,225599..00 $$55,,992222..00 $$66,,550022..00 $$77,,118822..00 $$66,,995599..00 $$88,,004444..00 $$88,,333322..00

NNeet t IInnccoommee $$22,,666622..00 $$33,,331133..00 $$33,,556688..00 $$44,,221122..00 $$44,,007788..00 $$55,,664422..00 $$55,,665588..00 $$55,,114422..00 $$55,,994466..00 $$66,,332200..00

TToottaal l AAsssseettss $$2211,,669955..00 $$2233,,447744..00 $$2255,,332277..00 $$2277,,998877..00 $$3311,,772277..00 $$2299,,993300..00 $$3344,,662288..00 $$3355,,999944..00 $$3399,,884488..00 $$6688,,115533..00

TotalTotal

LiabilitiesLiabilities

$$1133,,004477..00 $$1144,,117766..00 $$1133,,445533..00 $$1144,,446644..00 $$1177,,447766..00 $$1144,,556622..00 $$1177,,339944..00 $$2233,,888888..00 $$2233,,004444..00 $$4466,,998899..00

TToottaal l EEqquuiittyy $$88,,664488..00 $$99,,229988..00 $$1111,,887744..00 $$1133,,552233..00 $$1144,,225511..00 $$1155,,336688..00 $$1177,,223344..00 $$1122,,110066..00 $$1166,,880044..00 $$2211,,116644..00

Some financial indicator of PepsiCo from 2001-2010Some financial indicator of PepsiCo from 2001-2010

YYeeaar r 22000011 22000022 22000033 22000044 22000055 22000066 22000077 22000088 22000099 22001100

COGS as % of COGS as % of 

RevenueRevenue

4455..77%% 4455..88%% 4455..99%% 4455..88%% 4433..55%% 4444..99%% 4455..77%% 4477..11%% 4466..55%% 4455..99%%

SG&A as % of SG&A as % of 

RevenueRevenue

3344..88%% 3333..99%% 3355..11%% 3355..22%% 3377..88%% 3366..22%% 3366..00%% 3355..88%% 3333..88%% 3388..66%%

OperatingOperating

Income as a %Income as a %

of Revenueof Revenue

1177..11%% 1188..88%% 1177..77%% 1188..00%% 1188..22%% 1188..55%% 1188..22%% 1166..11%% 1188..66%% 1144..44%%

Net Income asNet Income as

a % of Revenuea % of Revenue

1111..33%% 1133..22%% 1133..22%% 1144..44%% 1122..55%% 1166..11%% 1144..33%% 1111..99%% 1133..88%% 1100..99%%

RReettuurrn n oonn

AssetsAssets

1122..33%% 1144..11%% 1144..11%% 1155..00%% 1122..99%% 1188..99%% 1166..33%% 1144..33%% 1144..99%% 99..33%%

RReettuurrn n oonn

EquityEquity

3300..88%% 3355..66%% 3300..00%% 3311..11%% 2288..66%% 3366..77%% 3322..88%% 4422..55%% 3355..44%% 2299..99%%

FinancialFinancial

LeverageLeverage

(Assets/Equity)(Assets/Equity)

22..5511 22..5522 22..1133 22..0077 22..2233 11..9955 22..0011 22..9977 22..3377 33..2222

Some financial indicator of PepsiCo as a percentage of revenueSome financial indicator of PepsiCo as a percentage of revenue

First, the revenue steady rose about 246% from 2001 to 2010 which may show a good indicator for First, the revenue steady rose about 246% from 2001 to 2010 which may show a good indicator for 

the company current performance. Also, at about the same rate of 247% the cost of good soldthe company current performance. Also, at about the same rate of 247% the cost of good sold

increases from 10,750 to 26,575. Additionally, The trend of CoGS’s fluctuation indicates a goodincreases from 10,750 to 26,575. Additionally, The trend of CoGS’s fluctuation indicates a good

control over the rising cost over years-not above 50% of revenue is remained. The operatingcontrol over the rising cost over years-not above 50% of revenue is remained. The operating

expense is enlarged at the faster rate-273% comparing to the operating income which have theexpense is enlarged at the faster rate-273% comparing to the operating income which have the