Pepsi Co Strategic Initiative Fin/370

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PepsiCo. Strategic Initiative Paper Learning Team C FIN/370 April 22, 2013 Tony Moses Strategic and financial planning are some of the most important aspects involved with running a successful organization. The process of strategic planning involves identifying company strategies for success, directions needed, and necessary decisions to be made. Financial planning involves estimating company capital and determining our competition. For this paper, we will discuss the strategic planning at Pepsi-Cola, with the initiative on building and expanding our nutritional business within the organization. Also, we will discuss how building and expanding nutritional business for Pepsi-Cola will affect costs, as well as sales. The risks involved and the financial effects of making the decision to expand on nutritional business will be discussed here as well. It is no surprise that this initiative will affect costs, PepsiCo is proud to owe part of their success to product innovation. Bringing in this initiative of building and expanding nutrition products through product categories such as; Quaker, Tropicana, and Gatorade, calls for effective product packaging, advertising campaigns, marketing campaigns, and research and development. Research and development includes such costs as developing new products, improving the quality of current product lines, and proposed initiatives. The expenses for PepsiCo incurred through research and development on an annual basis, have been increasing each year for the past few years. In 2010 research and development costs were $488 million, in 2011 they were $525 million, and in 2012 it increased to $552 million. This initiative will affect cost, but not in a negative way. The PepsiCo strategic initiative of building and expanding their nutrition business will definitely have an impact on their overall sales for the year.

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