Frito-Lay Sun Chip

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Frito-Lay, Inc. Sun Chips™ Multigrain Snacks Market Analysis The snack chip category is very competitive. As many as 650 snack chip products are introduced each year by national and regional brand companies. Most of these products are new flavor for existing lines of snack chips. The new-product failure rate for snack chips is high. It has been reported that less than 1 percent of new products generate more than $25 million in first year of sales. Snack chip competitors rely heavily on electronic and print media advertising, consumer promotions, and trade allowances to stimulate sales and manufacturers often rely on price deals to attract consumers. The technology used to produce snack chips allows manufacturers to react quickly to new products introduction by competitors. Extensive sales and distribution systems employed by national brand competitors also allows them to monitor new product and promotion activities and place competing products quickly in the supermarkets. Snack chips are sold by national brand firms, regional brand firms, and private brand firms. National brands distribute products nationwide, including Frito-Lay, Proctor and Gamble (Pringles®), RJR Nabisco, and Keebler. Regional brands only distribute product in a certain parts of the United States. These firms include Old Vienna, Synder’s, Mike Sells, and Charles Chips. Private firms are produced regionally or locally on a contractual basis for major supermarket chains. Company Analysis Frito-Lay, Inc. is a division of PepsiCo, Inc., it 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, and Tostitos® brand, and Santitas® brand tortilla chip and Cheetos® brand cheese-flavored snacks, Rold Gold® brand pretzels. Frito-Lay, Inc. accounts for 13 percent of

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