Pepsi 2010 Annual Report Download - page 50

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at every level: from the way our products reach our customers; to
how our products are displayed; to the channels through which our
products are marketed and advertised.
Build and expand our nutrition business
Our fourth imperative is to build and expand our nutrition
business and our global nutrition initiatives, to rapidly grow
our Good-for-You portfolio of products — both organically and
through strategic tuck-in acquisitions. Consumer tastes and
preferences are constantly changing and our success depends on
our ability to respond to consumer trends, including responding
to consumers’ desire for healthier choices. Our basic belief is that
companies succeed when society succeeds, and what is good for
the world should be good for business. This includes encouraging
people to live healthier lives by oering a portfolio of both enjoy-
able and wholesome foods and beverages. With the acquisition
of Wimm-Bill-Dann Foods OJSC (WBD), PepsiCo’s annual rev-
enues from nutritious and functional foods are expected to rise
from $10billion to nearly $13billion. We also are expanding our
portfolio of products made with all-natural ingredients, increas-
ing the amount of whole grains, fruits, vegetables, nuts, seeds and
low-fat dairy in certain of our products and taking steps to reduce
the average amount of sodium, saturated fat and added sugar per
serving in certain of our products.
Cherish our PepsiCo associates
Our fifth imperative is to cherish our PepsiCo associates.
Our continued growth requires us to hire, retain and develop our
leadership bench. We are fortunate to employ, worldwide, a truly
remarkable set of associates. The market becomes more competi-
tive every day and innovation is the key to success. It is people
who hold that key and to be a good employer is one of the most
important strategic decisions a company has to make.
Achieve excellent performance
Our sixth and final imperative is the sum total of the other five.
Our continued success requires that we do everything we can to
position ourselves to achieve excellent performance in each of
the areas mentioned above. By focusing on the five key challenges
and related strategic business imperatives discussed above, we
believe we can achieve this goal.
Our Operations
We are organized into four business units, as follows:
1) PepsiCo Americas Foods (PAF), which includes Frito-Lay
North America (FLNA), Quaker Foods North America
(QFNA) and all of our Latin American food and snack busi-
nesses (LAF), including our Sabritas and Gamesa businesses
in Mexico;
2) PepsiCo Americas Beverages (PAB), which includes PepsiCo
Beverages Americas and Pepsi Beverages Company;
3) PepsiCo Europe, which includes all beverage, food and snack
businesses in Europe; and
4) PepsiCo Asia, Middle East and Africa (AMEA), which
includes all beverage, food and snack businesses in AMEA.
Our four business units are comprised of six reportable
segments (referred to as divisions), as follows:
• FLNA,
• QFNA,
• LAF,
• PAB,
• Europe, and
• AMEA.
Frito-Lay North America
Either independently or through contract manufacturers, FLNA
makes, markets, sells and distributes branded snack foods.
These foods include Lay’s potato chips, Doritos tortilla chips,
Cheetos cheese flavored snacks, Tostitos tortilla chips, branded
dips, Rues potato chips, Fritos corn chips, Quaker Chewy
granola bars and SunChips multigrain snacks. FLNA branded
products are sold to independent distributors and retailers. In
addition, FLNA’s joint venture with Strauss Group makes, mar-
kets, sells and distributes Sabra refrigerated dips and spreads.
Quaker Foods North America
Either independently or through contract manufacturers, QFNA
makes, markets and sells cereals, rice, pasta and other branded
products. QFNA’s products include Quaker oatmeal, Aunt
Jemima mixes and syrups, Cap’n Crunch cereal, Quaker grits,
Life cereal, Rice-A-Roni, Pasta Roni and Near East side dishes.
These branded products are sold to independent distributors
andretailers.
Latin America Foods
Either independently or through contract manufacturers, LAF
makes, markets and sells a number of snack food brands includ-
ing Doritos, Marias Gamesa, Cheetos, Rues, Emperador,
Saladitas, Sabritas and Lay’s, as well as many Quaker-brand
cereals and snacks. These branded products are sold to indepen-
dent distributors and retailers.
PepsiCo Americas Beverages
Either independently or through contract manufacturers, PAB
makes, markets, sells and distributes beverage concentrates,
fountain syrups and finished goods, under various beverage
brands including Pepsi, Mountain Dew, Gatorade, 7UP (outside
the U.S.), Tropicana Pure Premium, Electropura, Sierra Mist,
Epura and Mirinda. PAB also, either independently or through
contract manufacturers, makes, markets and sells ready-to-
drink tea, coee and water products through joint ventures with
Unilever (under the Lipton brand name) and Starbucks. In addi-
tion, PAB licenses the Aquafina water brand to its independent
bottlers and markets this brand. Furthermore, PAB manufac-
tures and distributes certain brands licensed from Dr Pepper
Snapple Group, Inc. (DPSG), including Dr Pepper and Crush. PAB
sells concentrate and finished goods for some of these brands to
authorized bottlers, and some of these branded finished goods
are sold directly by us to independent distributors and retailers.
The bottlers sell our brands as finished goods to independent
distributors and retailers. PAB’s volume reflects sales to its