...Frito- Lay Case Frito-Lay, Inc is a worldwide leader in the manufacturing and marketing of snack chips. In 1960, the Frito Company and the H.W. Lay Company merged to become Frito-Lay, Inc. The company is the leading manufacturer of snack chips in the United States, capturing about 50% of the retail sales in this category. Frito-Lay, Inc has been developing multigrain chips since the early 1970s after marketing research found that consumers wanted nutritious snacks, consequently in 1974 the company launched to the market Prontos, a multigrain chip that was not really a great success, hence withdrawn from the national market in 1978. People concluded the product was not introduced in the right time. The Sun Chips was introduced in the early 1970s, and the name was assigned to a line of corn chips, potato chips, and puffed corn snacks. Six years later, the name was given to a line of corn chips, but unfortunately in 1985, this line was also withdrawn from distribution due to poor sales performance. However, in the early 1980 Frito-Lay executives started worrying about the health of the baby boomers. They were getting older and healthier conscious, so snack companies had to develop newer, healthier snacks for people trying to stay away from the salty, fried chips. Product research and development continued during the 1980s with The Harvest but in the early 1980s several market tests failed. Nevertheless, in 1988 with the idea still of multigrain products, marketing research studies...
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...1.1 Background Frito –Lay, Inc. Frito-Lay, Inc is a division of PepsiCo, Inc, a New-York-based diversified consumer goods and services firm. Besides PepsiCo, Inc. divisions include Pizza Hut, Inc, Taco Bell Corporation, PepsiCola Company, Kentucky Fried Chicken and PepsiCo Foods International. PepsiCo, Inc recorded net income of $1.077 billion on net sales of $17.8 billion in 1990. Company Frito Lay, Inc is a worldwide leader in the manufacturing and marketing of snack chips Well-known brands include Lay’s brand and Ruffles brand potato chips, Fritos brand corn chips, Doritos brand, Tostitos brand and Sanitas brand tortilla chips, Cheetos brand cheese-flavored snacks, and Rold Gold brand pretzels. The snack chips industry accounts for approximately 26% of the snack food industry. Doritos brand tortilla chips and Ruffles brand potato chips have the distinction of being the only snack chips worth $1 billion in retail sales in the world. Frito-Lay, Inc accounts for 13 per cent of sales in the United States snack-food industry recorded retail sales of $37 billion in 1990 which includes candy, cookies, crackers, nuts, snack chips, and assorted other items. The company is the leading manufacturer of snack chips in the US, capturing nearly one half of the retail sales in this category and has 39 manufacturing plants, more than 1,600 distribution facilities and a 100,000 person route sales team that calls on more than 400,000 retail store customers each week in United...
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...Isaiah Polk Professor Desmarais Pom 448 March 10, 2015 Frito-Lay: The Backhaul Decision Frito-Lay, the largest salty snack manufacturer in the United States based out of Texas is a two-billion plus corporation employing over twenty-seven thousand employees. The company came into existence from a merger between the Frito company and the Lay company. Then in 1965 it was purchased by the Pepsi Corporation and because the the company’s belief of “If it ain’t broke, don't fix it” Frito-Lay’s management was able to operate under the own accord as they had previously done before. Frito-Lay’s product mix is made up of potato chips, corn chips, tortilla chips, cheese-flavored snacks, pretzels and other snack items and dips. It has six core products; Lays, Ruffles, Fritos, Doritos, Tostitos, and Cheetos, that make up roughly eighty percent of their sales. Their core products have short shelf lives and are high volume low-weight products. Along with the core products they have specialty products but these products have longer shelf lives and produce less sales. Currently Frito-Lay operates using direct store delivery using their own private fleet of trucks. Eighty-five percent of their outbound sales were made on their own vehicles. By doing this it allows them to avoid third party distributors for sale services. It also means total quality control of products and a high service level. They have a very high on-time delivery rate compared to competition (same day vs same hour) because...
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...four major categories: (1) monopoly, (2) pure competition, (3) monopolistic competitive, (4) oligopoly. In a monopoly, a single business or company supplies a product and or service for which buyers cannot find a substitute. A Monopoly may arise when one company can supply a given commodity more cheaply than two more companies can. Our textbook defines a monopoly as “an industry composed of only once firm that produces a product for which there are no close substitutes and in which significant barriers exist to prevent new firms from entering the industry” (Case, 2009). By purchasing all firms involved with the potato chip industry the two lawyers have created a pure monopoly. A pure monopoly is an industry with a single firm that produces a product for which there are no close substitutes and in which significant barriers to entry prevent other firms from entering the industry to compete for profits” (Case, 2009). By seizing control of the market, the firm would now control their position on the market demand curve. They would control everything. With that being said,...
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...Case 2 Position Paper Fito Lays Frito-Lays should pursue the vegetable dip market to remain a leader in the chips in dip Industry. I believe that some of the executives are stuck in a conventional logically way of thinking while others are focused on value Innovation. The conventional thinking executives are happy with the progress they have made with the cheddar dips and newer sour cream dips and they feel that they should concentrate on developing more brands to continue to be competitive. The problem with this strategy is that the competition is doing exactly the same thing. Frito-Lays and its competitors are continually trying to introduce new dips in hopes of securing more market share. In 1985, statistics show that 620 million dollars of dip was sold through supermarkets. In the same year 207 million dollars of the total dip sales where linked to vegetable usage. This translates to 33% of all dip sales in 1985 where linked to vegetable dip. Since Frito-Lays in the shelf stable dip market and total sales in this market where 185 million. Frito-Lays shelf stable dips contribute to 73% of this market with sales of close to 135 million. This means that there is only 27% of the market left to capture if they put a strategy together to remain in the chips in dip market. Common business knowledge should tell these conventional thinking managers that they already dominate the shelf stable dips market. It would not be a good marketing decision to try to expand...
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...Green Manufacturing and Sustainability at Frito-Lay Case Study 3 Questions 1. What are the sources of pressure on a firm such as Frito-Lay to reduce its environmental footprint? 2. Identify the specific techniques that Frito-Lay is using to become a green manufacturer. 3. Select another company and compare its green policies to those of Frito-Lay. Each Case Study paper is to consist of the following components: 1. Title page and two written pages with no more than 500 words. 2. Answers to individual questions (as assigned) Each assignment will have specific questions you need to address. You should create a sub headed section for each one. 3. References/Appendix (if required) These are not research papers per se, so you may not have the need to cite outside sources. If you do, however, they should be identified on a proper reference page. Similarly, if you are required to do calculations and choose to perform them on a separate page, you should include them in an appendix. Weekly Case Paper Grading Rubric | Category | Points | Weighting | Description | Content | 24 | 80% | * Required questions are answered in an accurate and appropriate manner. * Adequate support is given for recommendations. * Calculations (where required) are performed correctly | Grammar and Spelling | 3 | 10% | * Paper is well written and reflects college level writing. * Rules of grammar, usage, and punctuation are followed and spelling is correct. * Sentences...
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...Savor Restaurant and Catering Heshan Abeywickrema Bellevue University MBA 652: Marketing Strategy Prof. Adrianne Agulla 04/20/2014 1. Case recap In 1997 the Frito-Lay Company, part of the PepsiCo, Inc. was looking at a possible acquisition of Cracker Jack from the Borden Foods Corporation. Cracker Jack is one of the oldest and one of the most well known trademarks in the United States, and the company has been under the Borden name since 1964. Frito-Lays interest to buy Cracker Jack came around when its parent company Borden announced the possible sale of the Cracker Jack brand. The executives at Frito-Lay wanted to know the potential of Cracker Jack and designated a team to consolidate the findings, create a plan of action on how to market Cracker Jack as a subsidiary of Frito-Lay, and finally to estimate fair market value of Cracker Jack as a entity. 2. Problem Identification The ready to eat caramel popcorn product category had decreased sales from the year 1995 to 1996. In 1995 there were sales totaling $205 million, and in 1996 it dropped down to $192 million. Besides the drop in sales there is also severe completion in the ready to eat caramel popcorn category that include national brand firms, seasonal/specialty firms, regional firms, and private label firms. Another alarming fact about the ready to eat caramel is that only about 12% of the total U.S. households consume the product. Only 2% of typical U.S. households would consume the ready to eat...
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...PepsiCo Case Study Analysis Paper Michael Gillespie Organizational Policy and Strategy, OML-450, Cohort (835) Professor Vicky Sons-Eiden September 15, 2011 PepsiCo Case Study Analysis Paper A case study analysis on PepsiCo’s diversion strategy in 2008 will be addressed in this paper. The elements that will be discussed are the vision and mission of PepsiCo, the background and history of the company, the external and internal forces of PepsiCo’s business environment, PepsiCo’s strategic marketing plan, and a conclusion and recommendations on how the PepsiCo company can improve their business strategy to stay competitive in years to come. Vision and Mission The vision of PepsiCo is to be a responsible company that supports continuous improvement of all areas across the globe in which they operate. These areas include the environment, social, and economic conditions creating a better future then the present. The mission of PepsiCo is to be the best company in the industry that provides convenient foods and beverages to the consumer. The company has a goal to provide financial benefits and growth for its shareholders as the company provides growth for its employees, its business partners, and the communities in which they are established. In all aspect of the business, PepsiCo strives to be the leader in honesty, fairness, and integrity. (PepsiCo, 2011). Company History PepsiCo Inc. was formed in 1965 when Pepsi-Cola Bottling merged with salty snack icon Frito...
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...SUCCESSFUL MARKETING AND PRODUCTION STRATEGIES OF FRITO-LAY PURPOSE Frito-Lay Inc. has remained the dominant leader in its industry through the success of consumer-focused business strategies: Effective marketing strategies to promote products during times of economic downfall. Product innovations, and adjustments to accommodate consumer preferences resulting from dietary trends. Creative, and inventive promotional techniques used to remain superior to competitors. This report discusses these strategies as a model for other businesses within the snack-food industry. Data for this report was gathered through current books, articles, journals, reports, and business research databases, including: Datamonitor, Factiva, Business & Company Resource Center, Business Source Complete, and IBISWorld located through Newton- Gresham Library, on Sam Houston State University’s campus, in Huntsville, Texas. BACKGROUND Frito-Lay is currently one of the leading and most recognizable company names in the snack-food industry. The company’s 17 leading brand names generate billions of dollars in annual sales. As one of the four company divisions of PepsiCo, Frito-Lay North America is the most profitable, contributing 39% of the company’s operating profit, and one-third of PepsiCo’s entire revenue. (Entire paragraph paraphrased (Frito-Lay North America, 2006). Frito-Lay was originally formed in the 1930’s during the Great Depression as an entrepreneurial venture...
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...Frito Lay Company Cracker Jack Case Analysis Marketing Essay Frito-Lay is worldwide leader in snack manufacturing and marketing. It represented 54 percent of retail sales of snack chips in United States, making it leader in that category. Frito-Lay is division of PepsiCo. Inc and in 1996 represented 31 percent of PepsiCo's net sales and 60 percent of PepsiCo's operating profit (Kerin & Peterson, 2010). Some of popular brands of Frio-Lay are Lay's and Ruffles, Doritos, Tostitos, Potato chips, Cheetos, Sun Chips and Funyuns onion-flavored snacks. During 1990's majority of Frito-Lay's growth was attributed to its low-fat and no-fat snacks such as Baked Lay's potato crisps, Baked Tostitos tortilla chips, and Rold Gold pretzels. Frito-Lay has extensive manufacturing infrastructure with 45 manufacturing plants in 26 states, including world's largest snack food plan in Frankfort, Indiana. It has extensive warehouses and distribution facilities as well with more than 1,800 in number and 17,500 salespeople who make 750,000 sales and delivery calls on approx 350,000 retail store customers each week (Kerin & Peterson, 2010). It also is one of leading national advertisers in the United States. Borden Foods' Cracker Jack is one of leading brand in Ready-To-Eat (RTE) caramel popcorn category. Because of Borden's strategic decision to focus its resources on pasta business and grain-meals, which needs significant resource investment, it has decided to divest Cracker Jack and related assets....
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...in india, nutyumz will be manufactured in the company-owned plant in pune. the fritolay spokesperson confirmed the launch of new brand. sources said pepsi is gung-ho about fritolay as the subsidiary has been making some money, it ended the year 2000 with a rs 4 crore profit, up from rs 3.04 crore earned in the year ending 1999. pepsi's idea is to create new categories to suit indian tastes and pump up the profit figures by at least rs 2 crore by the end of 2002. sources said that after pepsi acquired uncle chipps, it got within its fold an entire constituency. lays and uncle chipps together earn the maximum (around 50 per cent) for fritolay, while cheetos and lehar namkeen are still on the fringes. pepsi is yet to measure up to haldirams market share which has maintained its numero-uno position in the namkeen segment for years, industry sources said. Crunch time Brand Launches, TNN Jan 29, 2003, 01.57am IST Frito-Lay introduces Red Chilli Chatka, an exciting tangy and spicy variant of Kurkure. The launch has been timed to coincide with the cricket world cup since Kurkure is...
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...™ Strategic Marketing, BA-MI20 Frito Lay, Inc. Sun Chips Multigrain Snacks Frito Lay, Inc. Sun Chips Multigrain Snacks Strategic Marketing BA-MI (20) Tutor: Mikael Rasmussen Student: Tina Wichmann Strategic Marketing BA-MI (20) Tutor: Mikael Rasmussen Student: Tina Wichmann Contents Abstract 3 Introduction Frito Lay, Inc. 3 The product Sun-Chips™ Multigrain snack 3 Product Lifecycle 4 Competition 4 Segmentation - How might the chip category be segmented? 5 Product & Branding Considerations 6 Product strategy 7 Pricing strategy 7 Advertising and Merchandising strategy 7 Distribution and sales strategy 7 Recommendations 8 Abstract In this report the objective is to evaluate the feasibility of Frito-Lay, Inc. launching a new product, Sun Chips™ Multigrain Snacks. Dr. Dwight R. Riskey, Vice President of Marketing Research and New Business at Frito-Lay, Inc. had to decide and present, together with the product management, the future for Sun Chips™ Multigrain Snacks. The chip had been in test-market for 10 months in the Minneapolis-St. Paul, Minnesota, metropolitan area and appeared to be extremely favorable according to consumer response. The presentation to the Frito Lay, Inc. seniors had to be persuasive, and besides the thorough assessment of the test-market data, Riskey added: “Sun Chips™ Multigrain Snacks required a new manufacturing process, carried a new brand name, and pioneered a new snack category...
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...Stracuzzi Columbia Southern University Enter Sun Chips Frito Co. was founded in 1932 by C.E. Doolin in Dallas, Texas. This same year Herman W. Lays begins his path down the snack chip path in Nashville, Tennessee (“Frito-Lay Corporation,” n.d.). In 1945, their paths merge into a business agreement to sell each other’s chips in their respective areas. These two companies merged in 1961 to become Frito-Lay, Inc. Only four years later, in 1965, Frito-Lay, Inc. became a division of Pepsi Co. (“Our vision,” n.d.a). Frito-Lay has become one of the world’s prominent producers and venders of snack chips. Some of their snack brands include: Baken-Ets, Cheester’s Fries, Cheetos, Cracker Jack, Cracker Jack’d, Doritos, Fritos, Funyuns, Grandma’s, Islen, Lay’s, Matador, Maui Style, Mrs. Vickie’s, Munchos, OvenBaked, Ready to go Snacks, Rold Gold, Ruffles, Sabritones, Santitas, Simply, Smartfood Popcorn, Stacy’s, SunChips, and Tostitos (“Full brand list,” n.d.b.). Frito-Lay also produces nuts, dips, and peanut butter crackers (Kerin & Peterson, 2013). Frito-Lay not only manufactures the snack foods, but has a hand in every stage of the process. The corporation has a potato breeding operation located in Rhinelander, Wisconsin. Their goal is to produce a superior potato variety for chipping (“Frito Lay Agricultural Research,” n.d.). They receive potatoes from roughly 80 different potato farms. They have 29 plants in 15 states (“Frito-Lay Plant locations,” 2013). The company also is involved...
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...Case Analysis：Frito-Lay, Inc. Problem Definition In mid-1990, Frito-Lay, Inc. makes a new chips brand called Sun Chips Multigrain Snacks. The product had been in test market for 10 months in the Mineapolis-St. Paul, Minnesota, and metropolitan area. The senior Frito-Lay executives need to decide it they would launch this new product to market officially after the test period. Objectives: (1) Extend its product to attract the customers who always look for new and variety product. (2) Update healthier recipe to meet the current trend of healthy eating. (3) Pioneer a new snack chip category to maximize profit in the new market. Concerns: (1) Whether the premarket test results can correctly reflect the market performance when it introduced to nationwide market. (2) There are many competitors in national market or local market. It's easy for them to make similar products. (3) The advertising and merchandising budget will rise. (4) The new product will cannibalize volume from its previous products. The Situation of the Company Frito-Lay, Inc. is a division of PepsiCo, Inc. It is a worldwide leader in the manufacturing and marketing of snack chips. It is capturing nearly one-half of the retail sales in the United States snack chips market. Well-known brands include Lay's brand Lay's brand and Ruffles brand potato chips, Fritos brand corn chips, diorites brand, Tostitos brand, and Santitas brand tortilla chips, Cheetos brand cheese-flavored snacks, and Rold...
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...ITP1 This essay will provide an explanation of the strategic transition of Frito-Lay North American Operations and the manner in which Executive Management and newly appointed CEO Michael Jordan, provide a new corporate vision and strategy to improve profits, and increase productivity. In this essay I will discuss the relationship, similarities and differences between IT strategy and Business strategy. Information Technology (IT) is a vital component to any successful business. IT Strategy focuses on how to make IT work for businesses and advance the business performance alongside examining ways of exploiting the full potential of information systems from existing and new IT products. Successful businesses now view IT as a tool to serves as a foundation of both operational excellence and competitive advantage. Frito-Lay used IT to improve sales management processes and to make the information readily available to its sales staff. 1-Identify and describe the overlap between the IT strategy and Frito-Lay business strategy. Frito-Lay management realized that the paper-based method of keeping inventory was inaccurate, wasted time, money and product. The overall strategy was to increase the efficiency of the sales operations process by implementing of The IT strategy is similar to Frito Lay business strategy business although the focus is specifically on technology. It is important to plan ahead for the development of your IT systems, which will need to be able to...
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