The company expects the change to become effective January 1, 2011, it said.
"This is a clear example of using PepsiCo's broad set of go-to-market systems to best serve our customers. We remain dedicated to the existing [image-nocss] warehouse distribution system for some of our beverage products, but the change to direct-store delivery makes sense for Gatorade as we redefine the sports nutrition category through the G Series," said Massimo d'Amore (pictured), CEO of PepsiCo Beverages Americas. "As a company, we are committed to bringing a wider variety of products to market more quickly and efficiently than ever before."
This will be the first large-scale step toward optimizing delivery systems resulting from the company's bottling acquisitions earlier this year. The expected synergies related to these changes are included in the company's target of $400 million in pre-tax annualized synergies from the bottling acquisitions once fully implemented by 2012.
"The distribution of Gatorade in key trade channels of convenience, UDS and dollar is well suited to the direct-store delivery model due to its high velocity, so the switch will result in better store-level customer service," added Eric Foss, CEO of Pepsi Beverages Co. "By achieving greater speed, simplicity and flexibility, we will be able to better serve the current and future needs of both our retail customers and consumers in the marketplace."
Other PepsiCo brands that are warehouse-delivered to the key trade channels of convenience, UDS and dollar, including Tropicana, Quaker and Naked Juice, will not be affected by this change, the company added.
Purchase, N.Y.-based PepsiCo, with annualized revenues of nearly $60 billion, offers the world's largest portfolio of billion-dollar food and beverage brands, including 19 different product lines that each generates more than $1 billion in annual retail sales. Its main businessesFrito-Lay, Quaker, Pepsi-Cola, Tropicana and Gatoradealso make hundreds of other foods and drinks in more than 200 countries.
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