Globally, higher prices have affected everything from oil to tech sales and the average consumer’s shopping habits. But one thing hasn’t changed — people’s snack and soda consumption. Find out how PepsiCo is dominating inflation right now.
Tuesday morning, July 12, PepsiCo was one of the first to report its Q2 earnings. The conglomerate behind mega-brands like Pepsi, Lay’s, Gatorade, and Doritos generated a total $20.2 billion in revenue for the second quarter of 2022.
Broken down, the earnings reflect an overall growth of 13%.
According to the same report, Frito-Lay had a bump of 14% to organic revenue in North America. Additionally, PepsiCo beverages had one of 8% in the same market.
As a result, Tuesday premarket reports highlighted PepsiCo (PEP) as one of the “stocks making the biggest moves.”
But what exactly is PepsiCo doing to dominate inflation? Here are some of pointers that business owners can take away from their winning playbook.
PepsiCo adapts the right way to thrive in ANY market
Due to inflation affecting the price of raw commodities, PepsiCo has had to also raise the cost of their products.
However, the price hike has only mildly affected the volume of sales and they have remained profitable.
“Inflation was higher than 12% over the quarter, so we did need to fix some pricing. Pricing did affect volumes, but the volumes have held up well.”— Hugh Johnston, Chief Financial Officer / Yahoo
The conglomerate’s steady volume of sales is the result of “keeping up with changing consumer needs and preferences,” the company added.
In short, PepsiCo is winning the ongoing battle against inflation by giving their consumers what they want and adjusting their pricing accordingly.
“Our results are indicative of the health and resilience of our categories, a diversified portfolio, our broad geographic footprint and out highly motivated and dedicated employees.”— Ramon Laguarta, Chairman and CEO / YouTube
At the beginning of 2022, the major food and drink corporation had a projected revenue growth of 4% for the year. Now, they are expecting profits to be up 10%.
The numbers reported are a testament to how smart business and a good product will survive any economy.
Or we just love our snacks.
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