PepsiCos Strengths (Internal Strategic Factors)

PepsiCos continued global growth and prominence reflects the companys strengths.
This aspect of the SWOT analysis framework outlines internal strategic factors that
enable firms to fulfill their business goals. The following are the most significant
strengths of PepsiCo:
1.
Strong brand image
2.
Broad product mix
3.
Extensive global production network
4.
Extensive global distribution network
As a successful global company, PepsiCo has one of the strongest brands in the
market. This strength enables the firm to attract consumers to its new products. In
addition, the broad product mix represents PepsiCos increasing ability to reach various
markets and segments, such as through Frito-Lay products, Quaker products, and
Pepsi products. PepsiCos extensive global production and distribution networks are
strengths that support the companys international growth and expansion strategies. In
this aspect of the SWOT analysis, PepsiCos strengths are sufficient to support its
global growth strategy.

PepsiCos Weaknesses (Internal Strategic Factors)

PepsiCo suffers from a number of weaknesses that act as barriers to international
growth. The internal strategic factors that limit organizational development are
considered in this aspect of the SWOT analysis framework. The following are PepsiCos
main weaknesses:
1.
Low penetration outside the Americas
2.
Limited business portfolio
3.
Weak marketing to health-conscious consumers
PepsiCo derives about 70% of its revenues from markets in North America and South
America. This weakness indicates that the company has not yet maximized potential
revenues outside the Americas. In addition, PepsiCo operates primarily in the food and
beverage industry. This is a weakness because it maximizes the companys vulnerability
to risks in the food-and-beverage market. Also, PepsiCo fails to effectively market many
of its products to health-conscious consumers. This aspect of the SWOT analysis
highlights weaknesses that PepsiCo must address through changes in its growth
strategy.

Opportunities for PepsiCo (External Strategic Factors)

PepsiCo has opportunities for continued global growth. In this aspect of the SWOT
analysis framework, external strategic factors that provide options for business
improvement are identified. PepsiCos opportunities are as follows:
1.
Business diversification
2.
Market penetration in developing countries
3.
Global alliances with complementary businesses
PepsiCo has the opportunity to diversify its businesses, such as by acquiring a
complementary firm that is not in the food and beverage industry. Another opportunity is
for PepsiCo to increase its penetration in developing countries to generate more
revenues from markets outside the Americas. In addition, PepsiCo can create alliances
with complementary business to increase its market presence. Based on this aspect of
the SWOT analysis, PepsiCo has significant opportunities to strengthen its business
resilience.

Threats Facing PepsiCo (External Strategic Factors)

The food and beverage industry experiences a variety of threats. External strategic
factors that could reduce business performance are considered in this aspect of the
SWOT analysis framework. In PepsiCos case, the following are the most significant
threats:
1.
Aggressive competition
2.
Healthy lifestyles trend
3.
Environmentalism
Aggressive competition is a major threat against the company. The influence of the
Coca-Cola Company is especially significant against PepsiCo. In addition, the healthy
lifestyles trend is a threat against PepsiCos products, many of which are seen as
unhealthful because of their sugar, salt, or fat content. Also, environmentalism threatens
the company in how consumers negatively respond to product waste and lifecycle
issues. This aspect of the SWOT analysis indicates that PepsiCo must reform its
strategies to overcome the threats to business.

PepsiCos SWOT Analysis Recommendations

PepsiCo can use its strengths to effectively respond to the issues identified in this
SWOT analysis, especially those considered as threats. The realistic actions that
PepsiCo could take to improve its competitiveness and international growth are as
follows:
1.
2.
3.

Diversify businesses to minimize market risk exposure

Further penetrate developing markets to grow revenues
Improve product healthfulness to attract more consumers

4.

Enhance recycling efforts to address environmentalism

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