Critically Analyzing Pepsi's Entrepreneurial Drive and Market Dynamics

This report critically analyzes the entrepreneurial aspects of Pepsi, focusing on its market structure, strategies, and competitive dynamics. The introduction outlines the report's scope, highlighting Pepsi's global presence and product range, including its revenue generation and market share. The main body delves into Pepsi's history, products, and market operations, particularly its oligopolistic market structure, and identifies how Pepsi uses pricing strategies and product differentiation to maintain its market position. The report also explores Pepsi's past market structures and the factors influencing its demand and cost curves. The analysis includes a discussion of market concentration and barriers to entry, and how these factors impact Pepsi's competitive advantage in the beverage industry. The conclusion summarizes the key findings and emphasizes the importance of understanding market dynamics for entrepreneurial success. The report also contains references to the sources used.

Critically analyse what drives someone
towards Entrepreneurship
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Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
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INTRODUCTION
Entrepreneurship refer to the concept that help for developing and managing the enterprise
venture. The report is mainly focused on the Pepsi Company that how will establish the position
for international marketplace.
The documentation will describe about the “Pepsi” Company, history, expenditure and their
current position in marketplace. The report will discuss about the different market structure such
as monopoly and oligopoly, identifying the effects on the business revenue, market share in
global world. At last, it will identify the specific nature of Pepsi where how it will operate
enterprise in global world.
MAIN BODY
Description about the Pepsi Company, product and history
Pepsi is based on the American multinational food, snack and beverage company and
headquartered in Harrison, New York. Pepsi has interest in the manufacturing, distribution and
marketing wide range of products more than 200 nations. In additional, it also provided the
various food items such as rice, cereals, dairy based item and clips. These type of food item will
help for increasing the demand of enterprise while attracting more and more potential consumers.
In this way, This organization may produce wide range of enjoyable food and beverage
according to requirement of client.
In 2019, Pepsi had generated more than $67 billion revenue (Spackman and Lahne,
2019). Sometimes including 23 brand that generate 1-billion as per estimation. Pepsi enterprise
has been achieved better the position in marketplace. Pepsi should be included various pricing
strategies to attract customer towards product and service. Furthermore, Pepsi should produce
most common item such as carbonate soft drinks, which always attracts towards more and more
consumers.
There are 274000 employees working together in the organization (Spackman and Lahne,
2019). According to report, PepsiCo has owned nine of 40 largest packaged goods trademarks in
US. He was formed in 1898 by great entrepreneur from North Carolina and afterwards, it had
acquired to provide the various offers regarding product and drink in marketplace.
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The Pepsi has acquired several brands such as lays, Gatorade that help for targeting large
number of customers. So as it become easier for maintain the position within competitive
markets. It supports for organization to generate revenue approximately 1-billion revenue every
year.
The Donald Kendall is the CEO of Pepsi that is always try to recognise the innovation for
purpose of business growth and development. In this way, it help for achieved the desirable goal
and objective. The primary aim of organization is to increase production and sales in global
world. Nowadays, Pepsi has provided the better food and beverage services to customer.
PepsiCo was established in 1964 and also merged with Frito Lay, Inc. the company was
manufacturing the Pepsi soft drink like mountain Dew product in marketplace. Another way, it
also focused on the producing core chips, potato chip with different flavoured after merger. It has
been developed the business on the basis of diversification. It is nothing as combination of
enterprise that made up Pepsi as strong diversified consumer firm in global marketplace (Love,
2019). Furthermore, PepsiCo compete with global, private as well as regional companies in term
of food or non-alcoholic beverage.
Analyse that Pepsi Operates the market structure and identifying revenue, share in the industry.
It has been analysed the Pepsi which operates their business in market through
appropriate structure and also improved the quality of services. Currently, Pepsi has been used
the Oligopoly market structure and increasing the demand of product as well as service in global
world.
Pepsi may collude to set up price or cost of particular product and afterwards, it achieve
the high output level. It is becoming profitable for Pepsi to build good coordination with
consumers (Owusu-Mensah, Naifei and Darkwah, 2019). As a result, it automatically increase
demand of product and service in marketplace. sometimes, It is extremely important for Pepsi
firm act as monopoly while reducing their individual output level.
PepsiCo is the classic example of non-collusive oligopolistic market structure. The
enterprise constitute of majority in cola industry but do not agree with the fix price. But
reduction of price/ cost which will directly affecting on the overall production and sales.
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Especially in rural areas where people have a lower disposable income. (Jamalnia and et.al.,
2019).
In context of oligopoly, Pepsi operates independently and also improve the production
level by taking effective decision. At certain point, Pepsi can use Game theory to handle the
different operation and function. Afterwards, it offers as framework for thinking about how firm
may act in context of decision-making.
The Oligopoly market structure is mainly considered as important part which always
influence Pepsi for improving their service. In order to maintain position of enterprise in global
marketplace. Therefore, it help for compete with other competitors and also dominate other
enterprises in market.
Pepsi has faced the barrier in term of patent, start-up price, franchises and also minimize
the average price (Jamalnia and et.al., 2019). In this way, oligopolistic market structure help for
maintaining the price, understanding the relevant to price makers but it is likely setup price and
increase level of output.
Since, PepsiCo is focused on the other type of oligopolistic industry regarding mutual
interdependence. It means that each firm profit depends on its current price and sales strategies.
So as Pepsi should use strategies to improve their services. Pepsi has a little to gain more profit
through pricing strategies and fulfill business requirements through oligopolistic market structure
(Spackman and Lahne, 2019). The enterprise rely on the non-pricing strategies in context of
competition through different strategies such as product differentiation, advertising. The primary
goal of PepsiCo firm is to increase the market share and keep maintain the price/ cost constantly.
In recently, Pepsi is a leading enterprise for providing the carbonated soft drinks. In 2004,
Coca cola has been increased the volume approximately 44% of U.S. Moreover, it has rapidly
increases 31% share in global world. The Pepsi enterprise which hold 90.3% of market shared
and selling in US market (Sinkonde and Loppa, 2020). As per considered the exhibits of
oligopolistic feature or characteristics whereby it is maintained the largest oligopolistic market
structure in marketplace. However, Pepsi should consider the differentiate approach to offer the
best quality of carbonate soft drinks. thus, it automatically control the price/cost on the basis of
mutual interdependence.
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Pepsi can be adopted the price strategies, which is mainly reflects on the specific demand
of customer regarding beverage and food items in marketplace. Moreover, Pepsi can be included
the demand curve for identifying the greater customer buying behavior towards substitutes of
product (Owusu-Mensah, Naifei and Darkwah, 2019).
On the other hand, it has reduced the price rate in elastic region and also impacts on the
total revenue with production of higher output level. In response to minimize the sales by 2-3%
in 2006 and then afterwards, Pepsi launched national advertising campaign which always
encourage or motivate the potential customer those who will consume more and more soft drink
(Zim and Zahan, 2019). In some situation, Pepsi conscious about quality of product and service
in marketplace. so as they can use concept of non-price competitive parameters. In order to
record the fluctuation of marginal price. Sometimes, the marginal price/cost is depending on the
large amount of enterprise investments such as advertisement, research and development. This
can be possible when implementing more efforts to differentiate the specific good and services.
The reduction of cost/price through oligopolistic market structure which is always
provide the benefits, advantage for potential consumers. Other hand, it is affecting on the
stakeholder as lower price which means to reduce their sales. (Owusu-Mensah, Naifei and
Darkwah, 2019).
In today’s world, it an essential for Pepsi to provide the accurate information or detailed
about products. However, it needs to use the online advertisement channel for increasing the
visibility among potential consumers.
Discuss about the different market structure operate by Pepsi and identifying the characteristic of
its previous market structure.
There are different type of market structures such as monopoly, perfect competition and
oligopoly. Nowadays, Pepsi can use oligopolistic market structure because it has provided the
independency, which make it easier to manage or control supply chain. The actual price will be
making by seller. Pepsi offering the large number of different products so that it become easier
for potential consumer to compare between one or more products (Owusu-Mensah, Naifei and
Darkwah, 2019).
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In today’s Scenario, Pepsi is the best example when they are adopting the oligopoly
market structure. It is trading on the similar type of item so that they can easily make control
over price/cost, Another way, it concern about changes within product and service according to
demand of potential customers.
In past decade, Pepsi has used the monopolies but it become undesirable due to shift
towards innovation and also generate lack of options. As per evidence, it has identified the
concept of Monopoly that provide the greatest benefits, advantage in term of economies of scale.
Furthermore, it is reducing the price/cost of product and service within beverage industry
(Owusu-Mensah, Naifei and Darkwah, 2019).
Pepsi always tried to maintain the position in marketplace, when they can use monopolies
market structure to fix the price of different product as well as service. In this way, each and
every people can purchase item. Furthermore, it can easily identify the huge capital outlay. At a
point, there are large number of suppliers use monopoly. It became obvious thing to improve
coordination between suppliers. Various potential consumers have been purchased the product
and service in global marketplace.
The price/cost will be changing due to ultimate objective, which provide the better
quality of good and service. Sometimes, it is acceptable for client at affordable price. The life
cycle of beverage item starts with the help of monopoly and achieve success. Therefore, it has
been evolved the monopolistic market structure in term of competition level. Since, it become
easier for organization to enter into competitive marketplace. Afterwards, it also differentiating
the product within development of new or unique model.
Characteristics of previous market structure
There are different factors affecting on the demand and cost curves of enterprise. so as
require to focus on the improvement of economic profitability in both long-term and short-term
growth or development (Spackman and Lahne, 2019). In previously, Pepsi should be considered
the Monopolies, competitive market structure but afterwards it has been transformed on the basis
of need or requirement for organization. Therefore, it can be identified the characteristics of
monopolies competition market structure.
Degree of concentration
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It refer to extent of market share which primarily hold by Pepsi. It will be measured the
different concentration ratios and used to access degree of concentration in global marketplace.
The monopoly can assume highest degree of concentration but followed by oligopoly (Owusu-
Mensah, Naifei and Darkwah, 2019). The competition of monopolistic structure have become
perfect in term of concentration. The market share of Pepsi is negligible in past decade.
Exit and Entry barriers
Exit and entry barriers are considered as factor that prevents entrants from competing in
the beverage industry. These are something that blocks or impedes the ability of Pepsi in market.
As per consideration of existing firm such as Pepsi in market but it can restrict from other
enterprises. Therefore, it can be represented the indication of market power (Shara, 2018). In
order to develop the barrier to entry point, which also increasing either from economies scale,
patent and copyrights. In context of monopoly, it is the highest entry barriers whereas it extent in
the oligopoly. Afterwards, it automatically represented the lower barrier.
As per analysis, it has found the historical information about the beverage industry where
they have adopted the oligopoly market structure. In order to gain the more competitive
advantage. In 2017, Pepsi continued to change the demand of potential consumer, afterwards
Pepsi has transformed into oligopoly market structure (Spackman and Lahne, 2019).
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Figure 1
Considering the nature of industry in which Pepsi operates.
The beverage industry consists of two different categories and sub-groups such as soft
drink, which comprising with non-alcoholic syrup manufacture. Pepsi has diversified the
enterprise model with strong presence of beverage categories (Jamalnia and et.al., 2019). So that
it may attract large number of customers towards good and services.
In recently, the strength of Pepsi is merges with other brand in which providing the
different type of snack food items. In 2018, Pepsi has gained $64.7 billion revenue, accounted
from 46% for beverage. Company will gain more benefits from the presence of food and
Beverage. In 2014, it has been reported that 54% of customer demand increases towards
beverage industry (Owusu-Mensah, Naifei and Darkwah, 2019).
Yes, when operating the Pepsi in market which require to consider different market
structure which becoming optimal for organization. In order to determine strength and weakness
of enterprise. The market structure has created as unique identity of enterprise and also support
for improving the current condition or situation of enterprise. It provide the right direction where
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Pepsi adopt the best market structure on the basis of need or requirement. The market trend has
continuously changed due to high competition level.
It is one of the central feature of oligopoly market structure that provide the better
direction of Pepsi when runs enterprise in strategically manner. This is consider as anticipate the
response of their rival when selecting better option. Oligopoly market structure which become
optimal for organization in context of competitions (Spackman and Lahne, 2019). They have
trading the business and then generating a lot of profit margin in markets. The goods and
services that are managed through oligopolies which highly having a big market share. Another
way, it being able to contrast the price/ cost and specific quality of forces. Therefore, Pepsi keep
maintain their prices in reasonable or affordable manner.
Lesser or greater Government intervention
The government intervention is based on the action that carried out by public entity may
effect on the current market economy. The intervention of government can provide the security
facilities and services. Sometimes, it helps for giving the employment benefits and minimum
income for those who were disabled or sick. That’s why, Government has provided the greater
intervention in term of economic development. It enabling for individual’s to achieve desirable
equal rights.
The government intervention is good for society because it always support for creating an
effective environment or culture. In order to perform different actions, developing an appropriate
regulation to increase business performance and efficiency.
Pepsi should consider the government intervention which may defend the use of various
policies in order to compensate the flaws of economic system. At certain level, it may have a
chances to increase the large economics imbalances (Owusu-Mensah, Naifei and Darkwah,
2019). The government intervention that will be praised by potential client which is always seeks
for maintain the low price/cost.
Moreover, Government have been performed the actions against threat in business, Also
making an effective policies and procedures for enterprise. it helps for Pepsi to build strong
brand value and ensure that different members access the information or data in proper manner.
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CONCLUSION
From above discussion, it has summarised about the “Pepsi” Company, history and its
product sell in marketplace. It can be analysed that Pepsi firm operate in global world through
market structure such as monopoly and oligopoly. In order to increase the overall enterprise
revenue, market share and value in global world.
Furthermore, it has discussed about the monopoly competition by Pepsi at initial level and
afterwards, it has been transformed into oligopoly market structure. In this report, it has
identified the nature of beverage industry and also operating various market structure for
organizational development.
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REFERENCES
Book and Journals
Jamalnia, A. and et.al., 2019. Evaluating the performance of aggregate production planning
strategies under uncertainty in soft drink industry. Journal of Manufacturing Systems. 50.
pp.146-162.
Love, J.K., 2019. Soda Goes Pop: Pepsi-Cola Advertising and Popular Music. Tracking Pop.
Owusu-Mensah, D., Naifei, R. and Darkwah, W.K., 2019 Analysis of Production System
Management of Ghana’s Food and Beverage Industry: Empirical evidence from Spare
Parts Inventory Control, Production Quality and Maintenance Modeling.
Shara, K., 2018. Corporate Social Responsibility in Beverage Industry A Comparative Study of
Coca Cola and PepsiCo.
Sinkonde, D.A. and Loppa, S., 2020. Methods and Techniques of Grounding: The Case of
Production Industry in Tanzania. MUST Journal of Research and Development. 1(3).
pp.13-13.
Spackman, C. and Lahne, J., 2019. Sensory labor: considering the work of taste in the food
system. Food, Culture & Society. 22(2). pp.142-151.
Spackman, C. and Lahne, J., 2019. Sensory labor: considering the work of taste in the food
system. Food, Culture & Society. 22(2). pp.142-151.
Zim, Z.S. and Zahan, M., 2019 Local versus global brands: The internationalization process in
Food and Beverage Industry.
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