IFE AND EFE OF PEPSICO

2127 Words Nov 8th, 2014 9 Pages
1.1THE INTERNAL FACTORS EVALUATION (IFE) MATRIX.
The IFE matrix is a summary step in conducting an internal strategic management audit of the PepsiCo. This strategies-formulated tool is to summarize and evaluates the major strengths and weaknesses in the functional areas of business. It also provides a basis for identifying and evaluating relationship among those areas of a business.
Internal strength
One of the strengths that can be found in PepsiCo is in term of strong brand equity. PepsiCo has a strong brand name in the world place and the company is well-known worldwide. This company is the best global brand in the world in terms of value of net revenue $43,251 million in the year of 2008. The company has a very recognized and
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As mention before, Coca-cola has 47.3 percent market share in the country’s cola market versus Pepsi which hold 44.5 percent. Coca-cola is also the brand known around the worlds, which are the largest producer and distributor of ark colas in the world. Even in the current monetary crisis, the company continues to expand and the financial position shows that Coca-cola has a strong cash position in compare to PepsiCo which the long term debt of PepsiCo is so high.
Besides that, another internal weakness of PepsiCo is overdependence on Wal-Mart. Wal-Mart is the largest warehouse and supermarket. Unfortunately, more than 13% of PepsiCo business revenues come from Wal-Mart store chain. Wal-Mart has a significant buyer power and can easily dictate prices over PepsiCo leaving it with very small margins. On top, PepsiCo would lose 13% of its revenue and competitive advantage if the company loses Wal-Mart. Therefore, it can be understand that PepsiCo depends too much on the US market. This is one of the weaknesses that PepsiCo needs to overcome as the external factors such as inflation can also affect the company if the company cannot be independent.
Lastly, the internal weakness of PepsiCo is that the company is facing a negative publicity. There are doubtful practices which accused PepsiCo is using and selling tap water. However, the company places view of mountains on its water bottle labels. The public claim that the company deceiving people to believe it
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