Need business and finance help with Dr Pepper Snapple Group 2011

Nov 15th, 2015
Price: $5 USD

Question description

"Dr Pepper Snapple Group 2011: Fighting to Prosper in a Highly Competitive Market" Please respond to the following: (Need simple answer, nothing elaborated)

The case study outlines six specific strategies that the firm has chosen to support its strategic direction. Determine which strategy is most likely to benefit the firm. Explain your rationale.

Briefly outline at least one other strategy the firm could take to support its strategic direction. Illustrate why this new strategy would be successful.

Dr Pepper Snapple Group 2011: Fighting to Prosper in a Highly Competitive Market

Larry Young, President and CEO of Dr Pepper Snapple Group, Inc. (DPS) seemed to be on a

roll. Named 2010 Beverage Executive of the Year by Beverage Industry Magazine, he led the

company through three very difficult economic years since it separated from the London-based

food and beverage giant Cadbury Schweppes. Reflecting on that time, he chuckled, “There

couldn’t have been a worse year to go public.”1 Triggered by the collapse of mortgage-backed

securities, the recession froze the credit markets and led to unprecedented commodities prices. In

spite of adverse economic conditions and fierce competition, the company managed to obtain

modest growth in sales in 2010.

Perhaps most satisfying of all was the recent turnaround of the Snapple Brand, which had been

struggling for many years.2 Sales volume for the brand grew 10 percent in 2010, fueled by new

products, packages and distribution. In addition, Dr Pepper, Canada Dry, Crush, Mott’s and

Hawaiian Punch all experienced increases in demand. A healthy cash flow allowed the company

to pay down its debt, increase dividends and repurchase shares.

A question remained as to whether the company was simply taking advantage of some fairly

obvious opportunities that it could not pursue when it was under Cadbury Schweppes ownership,

or whether this number three firm could actually begin to prosper in an industry dominated by

two of the strongest brands in the world. After all, although DPS sales were up almost 2 percent

in 2010, profits were lower than in 2009. In comparison, Coca Cola Company experienced

growth in revenues of 13.3 percent in 2010, with operating income increasing by 2.7 percent.

During the same time period, PepsiCo had revenue growth of 33.8 percent and growth in

operating profit of 3.6 percent.

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