International Business Environments
Frito-Lay, inc. It is an American Pepsico subsidiary that manufactures, markets and sells corn chips, fried potatoes and other snacks. The main brands of snacks produced under the name of Frito-Lay include fried corn chips, doritos and tostitos, Lay’s and Ruffles, Gold Rold and Walkers, each of which generated annual world sales for more than one billiondollars in 2009.
Before being fried-light the company was known in mid-1932 as The Frito Company created by a businessman named Elmer Dollin, placing his offices in Texas. The company was not going well and a possible closure of it was forecast. In a last attempt to save the Dollin company, he gave the task of finding a new product to complement its ice cream business. In a cafeteria he tried some fried food. For 100 dollars I buy the recipe, 19 retail sales accounts and the machine to do those fried frying or at least that says the legend. Blissful friedness that created an empire and marked a milestone in the snacks that we consumed today. Fritos managed to take advantage of fried foods, so much so that for the day of the death of Elmer Dollin (1959), the company already produced 40 products, had plants in 18 cities, used about 3.000 people and sales exceeded 50 million dollars.
On the other side of the United States in the same year as Dollin Fundo his company, another visionary businessman named Herman W. Lay would also start a fried business made of potatoes, exactly in Nashville (Tennessee) called The Lay Company that at that time did not still have that name and that, like the fried company, was dedicated to the distribution offrozen. It was not until a sales plan failed that Mr. Lay in 1928 decided to venture into fried fryingin sales.
It was so that for 1934.W. Lay Distributing Company Achievement Recognition and three years later, Lay had 25 employees and had a larger manufacturing company where he produced popcorn and cookies related to peanut butter. He sold his facilities, asked for a loan to the bank, moved to Atlanta and changed the Barret logo for the h.W. Lay co., Inc.. So when he formed the H.W. Lay Corporation in 1939.
By 1945 these two already large fried dealers had their first approaches by signing an exclusive franchise to manufacture and distribute fried fried. Together they worked towards national distribution and developed a close commercial affiliation. It was so that by September 1961 The Frito Company and H.W. Lay & Company merged to become Frito-Lay, Inc.,Combining its headquarters in Dallas, Texas. At this point, the company’s annual income amounted to $ 127 million.
Be clear that before the union of these two companies already separately they had to face different business environments, but it was not until this point where they draw a path to an international company that evidenced the difficulties when entering into cultural, economic, economic environments, international social and political, for example, from the perspective of a political environment. The big snacks in the mid-1965 merged with Pepsi-Cola Company, thus forming Pepsico, Inc. Pepsico had planned the commercialization of fried-light snacks along with Pepsi-Cola soft drinks. The plans to jointly promote soft drinks and products were frustrated later that year, when the Federal Commerce Commission failed against. Demonstrating once again the way in which this type of environments can influence and that the analysis of the political environment is fundamental when elaborating the strategic plan of any commercial project. But as the company continues to expand these environments, they will be more difficult to control.
Speaking of marketing the company in an effort to create a cartoon for advertising purposes ended in some way creating a racist drawing, this with the creation of “the fried bandito” which portrayed Mexican stereotypes, by introducing a character with hat and bandits, aBigote in the handlebar and swing guns.
The criticisms did not wait and had to make corrections to the cartoon to the point of withdrawing it. This has a lot of allusion to the cultural environment, since it says that it is a joint factor of beliefs, customs and behaviors that surround a person and influence their development. This includes ideological, religious, idiomatic, historical, aesthetic, ethnic, educational or social aspects that condition and have an impact on the decisions and personality of the individual, because companies are not isolated entities, but interact with everything thatsurrounds them. As it would be, the behavior of consumers, public policies, legal norms and market behaviors are some of the factors that can affect their businesses.
In addition, socially and economically speaking, the company has not long since starred in an act classified as ruthless in one of its Frito-Lay branches based in Panama by unjustified saying more than 50 vendors in the area of the capital and the chorreragiving them a small compensation that did not correspond to the work time that each seller had, for them to hire new sellers which caused them a low sales of approximately 450 thousand dollars per month, low from which the company has not yet been able to recover. Based on this event we can reiterate the importance of factors, factors that are often out of the control of a company and can be both on a large scale, known as macro factors, as a small scale, micro factors. From an economic and social framework, these factors hinder or still generate losses to the company. In this case, factors such as employment, unemployment and consumer confidence levels were the triggers of this decrease in sales by the company because they did not measure the consequences at the social level that would lead to this, therefore, the rejection byConsumers in addition to possible workers was quite evident.
In conclusion, it is clear that international business environments and their factors are sometimes out of the control of a company, but this does not mean that analysis and studies techniques cannot be established to have a better idea of the characteristics that surroundTo these environments. The Frito-Lay company, INC has a presence in more than 42 countries, and also generates 13 billion dollars, although it has had inconveniences in the different environments, of them could build a sustainable company and is now known as the Snacks giantand a formidable international company.
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