Degree

Master of Business Administration Executive

Faculty / School

School of Business Studies (SBS)

Year of Award

2026

Advisor/Supervisor

Mr. Faisal Jalal, Visiting Faculty, Department of Management

Project Type

MBA Executive Research Project

Access Type

Restricted Access

Keywords

Food, Food Industry, Snacks, Competitive Strategy, Food Competitive Strategy in developing countries, how to make Competitive Strategy, Competitive response strategy in emerging markets

Executive Summary

Pakistan's savory snack market was worth about USD 0.86 billion in 2026 and is growing 9.31% a year. About 40% of what people eat in this category is still loose or unbranded, sold with no brand name on it at all. PepsiCo Snacks Pakistan sells the country's best known salty snacks including Lay's, Kurkure and Cheetos, through its strong delivery network. However, it is being faced revenue pressure due to rapidly emerging local players competing on three things i.e. Quantity, profit the shopkeeper earns, and how well they work their own neighborhoods rather than competing on brand name. The company is now faced with two options; cutting prices to compete with the local brands and give up the premium position the brands are built on. Or cutting costs to match local cost levels that would give up the profit margin the rest of the business depends on. This study will explore How can PepsiCo Snacks Pakistan answer local competition without losing either its premium position or its profits. To answer the question, the study captured insights at all four levels of the trade (Company, Distributor, Retailor and Consumer) rather than just one. Interviews were conducted with two PepsiCo sales managers and three representatives from a PepsiCo distributor. A survey covered 27 shopkeepers across Karachi and interior Sindh, and the shelves of 26 of those shops were counted brand by brand and an online survey collected 100 usable consumer replies. The reason for using four levels is simple because a company describing its own delivery network is not a neutral witness to it, and a shopkeeper describing his own profit is not a neutral witness to the company's prices. The findings of the study include delivery reach and shelf presence really are the company's strongest asset. The second finding makes the threat much narrower than it first looks because consumer rate local brands worst on exactly the things that make them buy. Taste and quality are the top two reasons people give for buying, and taste and quality are also the top two weaknesses they see in local brands. So, the fight is not about which brand people prefer. It is about how much you get for your money at the cheapest price points, and how much the shopkeeper earns on the sale. Most people who believe it are not acting on it, that is a problem with how people see the product, not a problem with the price, and it can be fixed without cutting price. The third finding is where the fight is being lost, and it is not with the shopper. It is at the counter where retailors were asked which brand gives them the best profit, they named a local brand 10 times out of 27. Lays was named 3 times and local brands are winning on shop economics, not on shopper preference, and that is a different problem from a weak brand. Next to it sits something the company cannot currently see i.e. company staff described their fieldwork as excellent. However, shopkeepers in Karachi rated their sales representative 2.93 out of 5, against 3.50 in interior Sindh. The worse score is in the tougher market, and internal reports do not show it. The fourth finding is a warning about time, and about aim. Among Lay's buyers, 41% said they would move to a local brand if taste and quality matched. Across the whole sample, people rate the importance of local flavours at 2.99 out of 5. Among 18- to 24-year-olds it drops to 2.17, the lowest score of any age group, and that is exactly the group being targeted. Company, distributor and shopkeeper evidence all point towards spicy local flavours. The first recommendation pillar defends the cheapest price points without starting a price war. Rebuild the value message around how much is in the bag rather than what it costs, tested first as a 5% increase in fill weight in Karachi. And turn the policy of matching local shopkeeper margins at entry level into something actually checked in the shop, rather than something stated at head office. The second recommendation pillar fixes fieldwork where the failure can already be measured. Run a service recovery programme in Karachi, which is the cheapest gain available and the only recommendation that costs nothing commercially. The third recommendation pillar protects the long-term position. Widen the quality lead and aim new flavours at what each age group actually says it wants rather than at an assumed cultural taste. And fix distributor economics before entry level volume is pushed up, because the first two recommendations add work and cost in exactly the part of the range where distributor returns are already thinnest. Finally, the study has some limitations such as the consumer and trade evidence come from urban Karachi and interior Sindh, so it cannot be read as national. The consumer sample leans towards middle- and upper-income households and under-represents the low-income shopper the company itself calls strategically important. Figures for market share, shop numbers and margins came from company staff and could not be checked independently, the revenue estimates rest on those figures plus a published market size. Things respondents said about competitors' tax or regulatory behaviour are reported as opinions and were not checked. So, the verdict splits in two. The Karachi service work and the fill weight test can go ahead on this evidence. National rollout of the value message, the margin checking, and the channel expansion should wait until they have been tested in smaller cities and until audited internal data replaces the estimates used here.

Pages

xv, 181

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