The Pepsico,and the Indian born chairman of pepsico M/s.Indira Nooyi announced that the compnay is in declining period and it is going to look over in lowering the cost to the company.As a result Pepsico decided to slash 3300 jobs initially, it als been announced that the job cuts might increase.The perennial silver medal winner in the great cola olympics announced weaker than expected sales in North America for the third quarter. Sales were down by 3% and profits down by 9% as consumers presumably reacted to worsening economic conditions by cutting back on everyday luxuries like sugar water in its myriad forms. Plano-based Frito-Lay has 48,000 employees in North America and is implementing these staff reductions as part of an ongoing process to strengthen Frito-Lay’s strong position within the PepsiCo. system and to drive future results, Frito-Lay spokeswoman Aurora Gonzalez said.
All of the positions impacted are managerial. Employees will receive severance packages, as well as career counseling and employment transitional services, Gonzalez added.The maker of Pepsi-Cola, Doritos and Sun Chips said Tuesday it plans to eliminate 3,300 jobs and shutter six plants in an effort to save $1.2 billion over three years. It plans to use the savings primarily to revive lagging U.S. soft drink sales.The company further said it will carry out a productivity program for simplifying organisation for effective decision making, increase cost competitiveness and for streamlining the product portfolio.Pepsi also said that it will get back to the basics of selling relatively inexpensive bubbly soda to consumers. This is a reversal of its recent emphasis on more expensive juices and energy drinks. As the economy worsens, consumers will presumably cut back on such items.In the third quarter, PepsiCo. reported a profit of $1.58 billion, or 99 cents per share. That compares to earnings of $1.74 billion, or $1.06 per share, during the same quarter last year.Goodman, the CFO, said the company had been planning the campaign over the last several months as a response to the consistent declines in sales volume in the U.S.
“We’re looking at re-engaging consumers, keeping the ones we have and making sure we’re getting additional consumers into the fold,” Goodman said, adding that a lot of carbonated soft drinks “are very affordable.”PepsiCo International delivered strong performance while lapping 20% revenue growth, amid growing demand across most markets outside the Americas, despite pricing actions across the board to cover commodity inflation.