General Background:
Frito-Lay is a section of PepsiCo that produces, advertises and trades corn chips, potato chips and other snack foods with its head office at Plano, Texas. There are totally 34 snack food brands produced under the Frito-Lay name which include lays, Fritos, Doritos, Cheetos, oven baked, Tostitos, sun chips etc.
Frito-Lay originated in 1932 as two distinct companies, the Frito Company and H.W Lay and company. Charles Elmer Doolin and Herman W. Lay were the respective owners of the two companies. In 1961, nearly after 30 years, the two companies combined to become Frito-Lay, Inc. In 1965, it united with Pepsi-Cola bringing about in PepsiCo, Inc. Since that phase Frito-Lay has functioned as a completely controlled product of PepsiCo.
Frito-Lay hires over 48,000 folks with yearly trades of over $13 billion. It adds up to nearly 59% of the salty food group in U.S. It trades its goods to 79 countries round the world containing military destinations. The biggest manufacturing facility is located in Perry, at almost one million square feet and 12 production lines. The unit supplies 250 million pounds of products and distributes 64 million cases each year to serve 18 states and takes as little as 24 hours for chips to be produced from a full potato- from farmhouse to packaging.
Frito-Lay Mission Statement:
“To be the world’s favourite snack and always within the arms reach”. ito-Lay is the producer of several different snack goods. In association with PepsiCo it is accountable for delivering the snack needs all over the world. It wants to provide the best and favourite snack food within the arm’s reach of everyone. It wants to continuously innovate to provide tasty snacks and do so by protecting the earth. It has committed itself to reduce its environmental footprint by conserving energy, saving water, minimizing waste and reducing harmful emissions.
No major innovation or research going on in the production of its products.
It provides an unhealthy regime to the world.
It is highly reliant on retail shopkeepers and customers.
High rate of failure due to restricted selection.
OPPORTUNITIES
Improving the profits by increasing the efficiency.
Innovating for better products to meet all sections of people worldwide and to people with health consciousness.
Assuring the society and proving its social responsibility.
Expanding into places worldwide.
THREATS
Strong competition from other producers i.e. evolving competitors with new category of products.
Changing in trend towards healthier snack products.
Rising raw material costs.
Availability of similar products for lower price.
Sources of Pressure:
1. Frito-Lay seeks to reduce the continuous variations in energy prices which affect the cost of production and subsequently the products drastically.
TO SWOT: A threat to Frito-Lay with ever changing raw material costs.
2. Frito-Lay also faces an indirect pressure to save money to increase its profits.
TO SWOT: It provides an opportunity to increase its profits by increasing the efficiency of the plant i.e. by reducing the energy consumption and wastage.
3. Pressure from global climatic changes which adversely affects the society.
TO SWOT: It provides an opportunity to prove its social responsibility to its customers.
Techniques being used by Frito-Lay to become a green manufacturer:
Frito-Lay has committed itself to produce green and sustainable products in four ways by conserving energy, saving water, minimizing waste and reducing the emissions. The following are the different techniques it is using to do so-
1. Installation of water recycling system: This system recycles the water used for washing the vegetables and sends it to the circulation system for its reuse. In
