Entering the new year of 2001, if there is any good news, it is that Pepsi itself has started a fight with itself.

PepsiCo (China) declared Lu Province its sphere of influence, and PepsiCo (Lu Province Joint Venture) disagreed. As a result, Pepsi (China) and Pepsi (a joint venture company in Lu Province) launched a price war around the Qingyu market, and the two cokes fought each other to a white heat, making everyone inside and outside the industry look confused.

At the same time, PepsiCo (China) forced Chinese investors in PepsiCo (Xikang joint venture) to withdraw their shares. When the negotiations between the two parties broke down, PepsiCo (China) significantly increased the price of Coke concentrate and did not allow PepsiCo (Xikang Joint Venture) to produce PepsiCo beverages other than Coke.

PepsiCo's business in China was shattered and in shambles, and agents at all levels were even more confused, not even knowing which factory to pick up the goods from.

In another time and space, Pepsi has surpassed Coca-Cola in China after years of channel construction. Because of this series of blind operations, he directly collapsed and was quickly thrown out of Coca-Cola a few streets.

And now, even with Xifeng's troubles, PepsiCo is still doing so, because its U.S. headquarters wants to eat alone and does not want to share a large amount of profits with Chinese joint ventures every year.

The source of all this is China's imminent accession to the WTO and the gradual relaxation of investment restrictions in various fields. In the past, foreign cola was not allowed to be sold domestically, and then it could be sold domestically but there was a quota, and after the quota was abolished, the number of joint ventures was increased, and now foreign cola is finally able to build a wholly-owned factory in China.

Those people at PepsiCo headquarters thought, since I can build a wholly-owned factory in China, why do I continue to engage in joint ventures?

This situation is not only in the beverage industry, for example, Dongxin mobile phone is a joint venture brand, and all the technology is provided by Motorola. Now Motorola directly issued an ultimatum, either the Chinese side will give up its shares, or Motorola will withdraw its capital and clear its shares, and the Chinese side has chosen the second option, so Dongxin mobile phone has become a real domestic product.

A few months later, Panasonic even confirmed to the media that it would make all 50 of Panasonic's joint ventures in China independent.

Multinational companies in all walks of life are using various methods to force Chinese investors back. Because they used to engage in joint ventures because they were restricted by policies, but now that the policies are suddenly relaxed, their greedy features are suddenly exposed.

And why did Coca-Cola not choose to act rashly in the face of Xifeng's continuous pressure, but Pepsi had to desperately seek sole proprietorship?

Because PepsiCo's business in China is too chaotic!

In the early 90s, PepsiCo adopted a very extensive development model in order to expand rapidly in China, and this hidden danger will continue for more than a decade.

There are three types of cooperation between PepsiCo and the Chinese side, namely joint venture, cooperation, and franchise filling. Some of these joint ventures are controlled by the Chinese party, some are owned by PepsiCo, and some even have no shares in PepsiCo (only providing cola concentrate to make a profit). The management methods are also varied, some factories are operated by the Chinese side, some factories are managed by Pepsi, some factories are contracted to operate, and some Pepsi and the Chinese side each send a general manager.

It can be said that management, marketing, and channels are all in chaos.

In principle, PepsiCo's factories in China are zoned, and products from one district cannot be sold to another. But in order to make money, Chinese investors may not care so much, for example, the Xikang joint venture is PepsiCo's largest bottling plant in China, and the Coke produced by Xikang is actually sold to the Northeast. The shareholders and regional dealers in the Northeast are not happy, so various promotions are disguised as price wars, and their own people often fight.

Moreover, in order to expand the channel, the joint venture manufacturers across the country joined forces to raise the channel rebate of Pepsi Cola very high. Coupled with the confusion in marketing management, one-third of PepsiCo's joint ventures in China have been losing money.

Even funnier is the authorized bottling plant, which is self-financed, self-operated and only buys PepsiCo concentrate for production. So they began to engage in crooked ways, buying local miscellaneous cola concentrates, filling them and selling them with the label of Pepsi.

In the face of such a chaotic situation, China's policy suddenly loosened, saying that it can build a wholly-owned factory in China, how can Pepsi still hold on?

At least the joint venture in Xikang province must be controlled, because it is PepsiCo's largest production base in China, contributing more than 30% of PepsiCo's profits in China.

It won't be long before PepsiCo will take the Xikang joint venture to court, and the arbitration court of the Stockholm Chamber of Commerce in Sweden will make a judgment, and the Chinese side will lose the case for "non-cooperation with inspections" and "cross-regional sales", and PepsiCo will take control of the Xikang joint venture. This lawsuit is called "the first arbitration case of China's accession to the WTO", but in fact, the Chinese party's crime is not a breach of contract, and PepsiCo exploited the loopholes in China's law at that time.

Five years later, the official involved in the China International Trade Arbitration Commission was arrested, and it was this person who proposed to submit the case to the Swedish court for arbitration!

In any case, PepsiCo's sole proprietorship process has made PepsiCo even more chaotic.

The lips are dead and the teeth are cold, and the rabbit is dead and the fox is sad.

The tragic experience of the Xikang joint venture company made the Shenghai joint venture company feel cold. This is PepsiCo's second largest production base in China, and Shenghai's Chinese investors directly joined forces with 15 PepsiCo bottling plants to hold a press conference to confront PepsiCo.

The two sides knocked out the dog's brains, making chicken feathers all over the ground, and Pepsi's market share plummeted.

In the years that followed, PepsiCo's joint ventures in China were not very profitable, and more than half of them even fell into sustained losses. Chinese investors chose to withdraw one after another, and Pepsi took advantage of the situation to take over, and in this way, it gradually became a sole proprietorship in a lose-lose way, and PepsiCo's Chinese business gradually improved.

Coca-Cola, on the other hand, is much more stable, with only four major partners in China, namely COFCO, Swire, Kerry and China International Trust. Among them, Coca-Cola and China International Trust are a joint venture company specializing in the production of Sprite and Fanta, and are not involved in the production and sales of Cola.

Kerry will be dumped by Coca-Cola in a few years, and COFCO will continue to sell factories to Coca-Cola. If it weren't for the rapid contraction of China's carbonated beverage market, it is estimated that Coca-Cola would have completely abandoned COFCO and Swire and finally realized a wholly-owned business in China.

"I'm going to have a big national Coke sale. Yang Xin said with a sneer.

Song Weiyang said: "It's completely possible, even if you can't beat Pepsi to death with one punch, you have to beat Pepsi so that you can't take care of yourself." ”

This is called, taking advantage of his illness, asking for his life!

Xifeng was the quickest to respond, and then Coca-Cola also stepped in. Both sides took advantage of Pepsi's civil strife to frantically promote and eat away at market share, and in a few months, Pepsi was made to death.

However, PepsiCo headquarters is still unrepentant, preferring huge losses and sharp sales to seek sole proprietorship - because the Chinese business is too chaotic, Pepsi will not be able to do it without sole proprietorship, which is equivalent to cutting the flesh and removing the pus, and don't want to ease up within three or five years.

By the autumn of this year, some institutions have counted the market share of carbonated drinks in China: Coca-Cola is 38.6%, Xifeng is 33.1%, Pepsi Cola has plummeted to 13.8%, Jianlibao is only 4.5%, and 10% of the market is divided by various miscellaneous brands.

It's completely changed!

According to the trajectory of another time and space, only after Pepsi joint venture company suffered serious losses and Pepsi China took the opportunity to take over the sole proprietorship, it could regain a firm foothold by frantically inviting celebrities to advertise.

But will Xifeng bring PepsiCo China to life?