PepsiCo Business Level and Corporate Level Strategies Research Paper

PepsiCo Business Level and Corporate Level Strategies - Research Paper Example From the paper, PepsiCo emerged in 1965 as a business union between Frito- Lay, and Pepsi- Cola. Later on, the company acquired Tropicana in 1998. Additionally, in 1998 it merged with Quaker Oats and later with Gatorade in 2001. PepsiCo mainly deals with beverages, snacks, and foods with revenues over $ 65 million dollars. The company aims to be a global leader in the production of convenient beverages and foods. In addition, it aims to increase shareholder’s wealth, empower employees, business associates and communities in which they conduct business. The company is divided into PepsiCo Americas Foods, PepsiCo Europe, PepsiCo Americas Beverages and PepsiCo Middle East and Africa. Under the business strategy, corporations with various businesses treat each as a separate strategic business unit. Essentially, in each unit, there are independent markets or products served by organizations with each serving diverse environments. For each market (or product segment), there is a uni que environment suitable for that division. In order to attain a competitive advantage then the organization ought to satisfy the needs of customers with a focus on youth. The essence of the business level strategy is the customers; the young people. The unique taste and features of the customers are a critical factor in ensuring that the strategy works properly. In addition, the consumption patterns of the youth should be taken into account when implementing the business level strategy. Market research on the customer’s preferences helps to gain a competitive advantage over Coca-Cola, which is more recognized globally in the beverages sector than Pepsi Cola. Maintaining a good relationship with customers has been effective by providing superior products to customers. The massive investment in market research and R&D is a testament to this. The Company focuses on brand loyalty, particularly in America. This loyalty translates to value creation and an increase in profitability for the company. The business strategy also tries to reach more global customers given that international business is more globalized than ever before. The business level strategy is also related to the generic five forces of competition. Thus, the strategies aim to gain a competitive edge over similar companies. One of the forces is the threat of new entrants. Given the popularity of soft drinks and the vast revenues among beverage companies, new entrants pose a huge threat. The emergence of new entrants is likely to come from emerging countries due to the low cost of production. In spite of the threat posed by new entrants, the industry is capital intensive with research and development a necessity for the companies.