With the rising prices amongst most of the big food/beverage brands, PepsiCo is looking to perform even better than they have projected.
Over the past year we have seen prices rise on almost everything from gasoline, to consumer products. While in many cases these price hikes hurt the business’s performance in the short term, PepsiCo managed to walk away successful from their most recent price hike.
PepsiCo’s performance has surpassed their original projections for the year. The company now expects its annual organic revenue to increase by 12% from its previous 10% expectation. From this, PepsiCo’s core gross profits increased by 8%.
“PepsiCo has largely benefited from its loyal customer base as well as its broad assortment of products. He said this helped insulate PepsiCo from bearing the brunt of economic headwinds. PepsiCo’s portfolio includes brands like Lay’s, Tropicana and Quaker Oats.”Wes Gottesman, Market Advisor at TradeZing
PepsiCo’s loyal consumer base and wide variety of products has helped their company become “recession-resistant”, as consumers even increase their consumption of these products during tough economic times.
“Pepsi has always been very strong in their consumer base and they have such a diverse portfolio of products. They have done such a great job of selecting and catering to specific markets.”Wes Gottesman, Market Advisor at TradeZing
PepsiCo has taken many strategies to increase revenue, such as decreasing the size of their servings and packaging, also known as “shrink-flation”. CEO of PepsiCo, Ramon Laguarta, said that they’re “looking at multiple ways to increase [our] revenue per kilo”. While as an investor this is a great sign, as a consumer, however, this is something to keep an eye out for.
To read the full article from ModernRetail, check it out here!