Describe the challenges faced by the company from a global perspective in invent

Question

Describe the challenges faced by the company from a global perspective in inventorying its products or services. What are the options? Which is the best option? Make recommendations to resolve the challenges.  n week 5, you have to discuss inventory. Go into the balance sheet and do an inventory analysis including inventory turns and whether inventory is increasing (out of control) or decreasing (being brought into better control.) Where do they warehouse? You might want to compare their numbers to industry averages or the performance of their main competitors.

These questions are about PepsiCo. Any information will be helpful. And they are specific to PepsiCo, some research might need to be done.

I need help with the information based on the questions listed above. I don't have the information, I am not sure how to answer the questions above about the company PepsiCo. The information needs to be looked up online or researched. It is for a research paper.

Thank you very much.

Explanation / Answer

Inventory

In simple words inventory is nothing but the stock that a business possess in order to achieve the ultimate goals of the organization which will result in fulfilling the objectives of the organization. It can be stated that inventory is the fuel of the business without which any business cannot function at all. therefore maintaining the inventory is a very important activity. Inventory management is the process of maintaining the goods present in the inventory of an organization and also keeping a record of all the details like product number, product quality, stock details of each and every product, etc.

PepsiCo

The second largest giant in the food, beverage and snack industry is also considered as one of the most dynamic and creative organizations in their operation management process. The primary product of the organization is carbonated drinks along with snacks like potato chips, tortilla chips, corn chips, cheese bites, etc. So we can observe that the company deals with food products and dealing with food products in the industry is the most difficult job because a lot of care is needed or else the products will get ruined resulting in loss of inventory and subsequently loss of the organization.

The challenges faced by Pesico while inventoring its products can be listed down. They are :

In 2011 PepsiCo received the Supply Chain Innovation award from the Council of Supply Chain Management Professionals as its Diect to Store Delivery model was a very big hit in the industry and helped the organization in reducing the number and size of inventories. The global presence of the organization compelled it to possess ditribution centres throughout the world which was expensive and this Diect to Store Delivery model eliminated the issue to a very large extent as there stocking of preoducts will decrease and the products will directly reach the respective stores.

If we look into the statictics of PepsiCo from 2010 we will observe a decrease the numbe of Distribution Centres and Warehouse based on the area covered because this Diect to Store Delivery model was accepted by most of them as it made the supply chain process easy and fast compared to the conventional process. The total current liabilitues have decreased and the Net Property, plant and equipment costs have also decreased in the last 5 year if we look at the trend we will notice that in 2012 the Net Property, plant and equipment cost was $19.14 Billion which has come down to around $16.59 Billion in 2016 which proves that the model is very much successful. The total investment has also decreased from $2.35 Billion to $1.95 Billion. The main competitor of PepsiCo is Coca Cola which has a increase in the net investment from $11.12 Billion in 2012 to 18.46 Billion in 2016 which shows a steep increase in the value.

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