PepsiCo, The Problems of a Wrong Distribution Strategy.
When a company enters a foreign market, the keys to its success is the distribution strategy, the channels it uses, as well as market know-how and customer knowledge and understanding. The case study of PepsiCo, provides evidence of the situation that a company faces when its distribution strategy is not correct.
PepsiCo accessed the Ukrainian market, back in 1968 and since then has been trying to sustain its position in the market. Despite the fact that the supply-chain management has led Pepsi to gain local fame and popularity, it is inefficient in terms of cost, which reduces the ability of the company to earn higher profits. Pepsi needs to redefine and redesign its supply-chain strategy to meet the challenges faced in the market and sustain its position in the country, especially with these huge competitors joining in (f.e Coca – Cola).
Some possible solutions for Pepsi, if they want to gain competitive advantage in the market, is to invest further in its supply-chain management. Emphasis in research has been placed upon global supply-chain management, where the notions of channel strategies have been drawing the interest of all. Pepsi needs to incorporate these concepts and tools into its marketing strategy in order to enable efficiency in supply-chain management. Its focus needs to be on customer satisfaction in the market and cost efficiency along with a leadership strategy that takes into account cultural gaps that are affecting its ability to reach all customers.