The company looks at many critical issues besides constant supply of the needed raw materials. They look for sustainable and responsible sourcing and this goes beyond the normal aspects of cost, sustainable supply as well as quality. Other factors that are critically looked at include the effects of their products on the environment as a result there are many innovations that have been conducted by the company to come up with an environmental friendly package. To ensure implementation of there desired objectives PepsiCo developed a code that is used by its supplier in order for them to help them adhere to their set goals. Since PepsiCo is a multinational company with many associate companies that are situated in many countries there are many suppliers that supply the associate companies with the needed materials. Therefore because of the nature of the company there are set standards that must be met by every supplier before his raw materials are accepted by the company.
PepsiCo needs to work at improving the quality of its drinks to avoid issues of poor quality like the ones which were raised by china when there cola drinks failed to meet the required standard. It’s also important for the company to continually look for ways which will help them to remain at the top. The quality of their product is a major issue. Another aspect which they need to closely look at is the issue of management and controlling. Bearing in mind that PepsiCo is a multinational company with many branches over the world one wonders how these companies are controlled. Poor product has resulted because of weak governance control. Some associate companies which are being controlled by foreigners opt to produce beverages that are of low standards because they are not under direct control of the main office and that is the reason products of poor quality have reached the market (Zairi, 1998).
One of the strengths of PepsiCo is its advertising and marketing strategies which are very effective compared to other companies. As a result their products are well known by many consumers. The companies have pumped a lot of money in this sector and that is the reason for its sustained position in the market. Despite the fact that there are many other brands that have been produced to compete with PepsiCo brands. Its advertising strategies are far beyond reach and these are some of the strengths of the company. Bearing in mind that most of their products are made depending on what consumers want its evident that some compromises can be made and for these reason the company is weak when its comes to quality and this has been further worsened by the fact that PepsiCo is a big multinational company. At times they base much on the quantity rather than the expected qualities and as a result major losses have been incurred at some point by the company (Trout and Ries, 2005).
A few changes that were made to improve the quality of the brand were not very fruitful because consumers refused to accept the change. They insisted on the original test of some of the brands like the Pepsi-cola. By the fact that consumer of these brands have been adamant to the efforts of creating a quality product it becomes very challenging. The company may want to improve the quality but the underlying challenge is whether the new brand and taste will be accepted by the consumers. PepsiCo weakness is quality but this weakness has earned the company huge sum of profit. Therefore it is very difficult to change this weakness because all the profits are coming in because of it. The best change which can be made by the company is to specialize in production of quality products but this can only be achieved if the management issues are dealt with first.
As we discussed in our first session; PepsiCo still remains a leading multinational that specializes in production of beverages as well as snacks. One of its products which is known world wide include coca cola beverage. Despite its major success in penetration of the market as well as making profits one of its main setbacks is the low quality of some of its products. This is the greatest challenge which has been faced by the company for a number of years. Many attempts that were made with the aim of improving quality did not yield much fruit because it resulted in great loss. The fact that consumers prefer the original coke test has been a hindrance to reforms which have been aimed at improving quality (Keri, 2003).