PepsiCo may increase product prices to overcome supply-chain challenges
Category: #headlines  | By Nikita Chaurasia  | Date: 2021-10-07 |
  • shareshare_icon
  • Twitter
  • Facebook
  • LinkedIn

PepsiCo may increase product prices to overcome supply-chain challenges
  • The price rise is mainly due to high product demand coupled with distribution challenges.
  • The escalating demands are backed by the lifting of COVID-19 restrictions in several geographies

Leading food and beverage company, PepsiCo, Inc. has reportedly decided to increase product prices again from early next year, to deal with supply-chain disruptions including an acute shortage of truck drivers.

Confirming the news, Hugh Johnston, Chief Financial Officer of PepsiCo stated that the company has been facing a massive shortage of Gatorade bottles and cans in the past few months. This is because demand for the beverage has soared at theatres and restaurants after the easing of months-long pandemic-induced restrictions.

He added that the hike in prices will allow the firm to completely absorb the impact of commodity inflation. Also, the supply-chain disruptions are expected to be minimized by the end of this year, said Johnston.

Notably, PepsiCo has already increased the prices in its snacks and soda segments, emulating the strategy set by the broader packaged food market to deal with surging rates of raw materials.

If reports are to be believed, PepsiCo’s U.K. business is also facing inadequacy of truck drivers owing to immigration rules imposed after Brexit, along with a year-long loss of dedicated driver training and testing procedures.

But the company does not expect any product shortage in supermarkets and stated that it will be in a better position by the end of the fourth quarter.

As per reliable sources, PepsiCo recorded a 9% increase in the third quarter organic revenue, out of which 5% came from the selling of higher-cost products. The prices increased up to 10%, accreditable to higher expenditure on marketing and distribution.

Also, the company’s net revenue rose by 11.6%, accumulating USD 20.19 billion in the September quarter. However, PepsiCo shares saw only a marginal increase in premarket trading.

Source credits-

https://finance.yahoo.com/news/1-pepsico-raises-annual-revenue-100940934.html

  • shareshare_icon
  • Twitter
  • Facebook
  • LinkedIn


About Author

Nikita Chaurasia     twitter

Nikita Chaurasia

Having always been daft at wordplay, Nikita Chaurasia, post the completion of post-graduation, commenced her journey into the content generation cosmos. Endowed with a professional MBA degree in Advertising and Public Relations, Nikita strives to integrate her creativ...

Read More..

More News By Nikita Chaurasia

Arm Holdings achieves $54.5 Billion Valuation in successful U.S. IPO

Arm Holdings achieves $54.5 Billion Valuation in successful U.S. IPO

By Nikita Chaurasia

Arm Holdings Plc, the renowned chip designer, has reportedly secured a valuation of $54.5 billion through its U.S. initial public offering (IPO) on Wednesday. This milestone comes seven years after its acquisition by SoftBank Group Corp for $32 billi...

JSW Steel to increase its capacity by double in the next 3 years

JSW Steel to increase its capacity by double in the next 3 years

By Nikita Chaurasia

According to Chairman Sajjan Jindal, JSW Steel has set a target to increase its capacity to 50 million tonnes within the next three years. Speaking at an event organized by the Bombay Chartered Accountants Society, Jindal also mentioned the company&#...

KLM unveils World Business Class Seats for optimal comfort & privacy

KLM unveils World Business Class Seats for optimal comfort & privacy

By Nikita Chaurasia

KLM Royal Dutch Airlines has reportedly unveiled its latest World Business Class seats, designed to provide enhanced comfort and privacy. The World Business Class seats feature a sliding door, ensuring a greater sense of personal space. Additional...