INTRODUCTION

INDUSTRIAL PROFILE

PepsiCO

The recipe for Pepsi, the soft drink, was first developed in the 1890s by a New Bern, North Carolina pharmacist and industrialist, Caleb Bradham, who named it "Pepsi-Cola" in 1898. As the cola developed in popularity, he created the PepsiCola Company in 1902 and registered a patent for his recipe in 1903. The PepsiCola Company was first incorporated in the state of Delaware in 1919. Ownership of this company traded hands several times throughout the 1920s and 1930s, and in the early 1960s its product line expanded with the creation of Diet Pepsi and purchase of Mountain Dew.

Separately, the Frito Company and H.W. Lay & Company - two American potato and corn chip snack manufacturers - began working together in 1945 with a licensing agreement allowing H.W. Lay to distribute Fritos in the Southeastern United States. The companies merged to become Frito-Lay, Inc. in 1961.

In 1965, the Pepsi-Cola Company merged with Frito-Lay, Inc. to become PepsiCo, Inc., the company it is known as at present. At the time of its foundation, PepsiCo was incorporated in the state of Delaware and headquartered in Manhattan, New York. The company's headquarters were relocated to its still-current location of Purchase, New York in 1970, and in 1986 PepsiCo was reincorporated in the state of North Carolina.

PepsiCo was formed in 1965 with the merger of the Pepsi-Cola Company and Frito-Lay, Inc. PepsiCo has since expanded from its namesake

product Pepsi to a broader range of food and beverage brands, the largest of which include an acquisition of Tropicana in 1998 and a merger with Quaker Oats in 2001 - which added the Gatorade brand to its portfolio as well.

As of 2009, 19 of PepsiCo's product lines generated retail sales of more than $1 billion each, and the companys products were distributed across more than 200 countries, resulting in annual net revenues of $43.3 billion. Based on net revenue, PepsiCo is the second largest food & beverage business in the world. Within North America, PepsiCo is ranked (by net revenue) as the largest food and beverage business.

Indra Krishnamurthy Nooyi has been the chief executive of PepsiCo since 2006, and the company employed approximately 285,000 people worldwide as of 2010. The companys beverage distribution and bottling is conducted by PepsiCo as well as by licensed bottlers in certain regions. PepsiCo is a SIC 2080 (beverage) company.

PepsiCos product mix as of 2009 (based on worldwide net revenue) consists of 63 percent foods, and 37 percent beverages.On a worldwide basis, the companys current products lines include several hundredbrands that in 2009 were estimated to have generated approximately $108 billion in cumulative annual retail sales

The primary identifier of companies' main brands within the food and beverage industry are those which generate annual sales exceeding $1 billion, and 19 of PepsiCo's brands met this description as of 2009: Pepsi-Cola, Mountain Dew, Lay's, Gatorade, Tropicana, 7Up, Doritos, Lipton Teas, Quaker Foods, Cheetos, Mirinda, Ruffles, Aquafina, Pepsi Max, Tostitos, Sierra Mist, Fritos, and Walker's. AREA OF BUSINESS The structure of PepsiCo's global operations has shifted multiple times in its history as a result of international expansion, and as of 2010 it is separated into four main divisions: PepsiCo Americas Foods,PepsiCo Americas

Beverages, PepsiCo Europe, and PepsiCo Asia, Middle East and Africa. As of 2009, 71 percent of the companys net revenues came from North and South America, 16 percent from Europe and 13 percent from Asia, the Middle East and Africa.