MGMT- Internal Factors Analysis

MGMT- Internal Factors Analysis

An internal factor analysis is a strategic tool that firms use to analyze and evaluate their internal strengths and weaknesses. The internal factor analysis of PepsiCo is as follows: 



S1 Strong brand image as it is known across the globe for its food and beverages. Its brand valuation is considered to be worth over $19 billion 1 4 4 The company’s brand is strong and its strategy towards building the brand is effective in growing the company. This also enables the company’s products to dominate the market
S2 Broad product portfolio as the company currently has more than 100 brands in the beverage, snack and food industry 1 3 3 PepsiCo’ broad product portfolio is as a result of the company’s strategy of increasing product offering.  The company could continue to grow its product portfolio in response to market needs
S3 Focus on innovation as a result of research centers that are located in 9 countries. The research and innovation support the development of many popular and high quality brands 0.8 3 2.4 PepsiCo’s focus on innovation shows that the company’s strategy on coming up with new products is neither effective nor ineffective. However, the company could use the research and innovation to develop more consumer-centered products.
S4 Strong distribution network globally whereby the company has distribution networks that facilitate a fast and reliable transfer of merchandise to retail and consumer stores 0.6 3 1.8 The company’s distribution network is important is enabling the company to remain competitive and control the distribution chain
S5 Strong financial position and shareholder friendly whereby the company returns a good amount of money to shareholders every year. In 2017, the company returned $6.5 billion to shareholders through dividends 0.7 3 2.1 The strong financial position enables the company to implement its strategy and return value to stakeholders. Further, the resources could be critical in advancing the company’s interests 
4.1 13.3
W1 Many PepsiCo’s products are considered unhealthy and this reflects negatively on consumers who increasingly looking for healthy beverages and snacks 1 2 2 With consumers becoming more health conscious, PepsiCo needs to think of meeting these new customer demands by offering more healthy options
W2 PepsiCo has had failed products such as Crystal Pepsi that have negatively impacted the company’s brand 0.5 2 1 PepsiCo’s needs to do more market research before developing new products to improve market response 
W3 PepsiCo has low market penetration outside the America making to company to heavily rely on the North American market for sales 1 2 2 The high dependence on the American market will limit the company’s potential for growth
W4 PepsiCo has a limited business portfolio with the company only operating in the food and beverage industry 0.5 1 1 The limited business portfolio is not very significant but could limit the company’s revenues when there is too much competition in the industry
W5 The company’s main product that is soda is its great weakness as soda consumption globally is reducing as consumers continue to seek more healthy options 0.5 2 1 Although this has not been a significant factor in the past, the trend could easily put soda companies out of business in the near future


Leave a Reply