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History lesson : How an almost bankrupt Pepsi gave Coca Cola a run for it's money.
All thanks to a disgruntled retailer of Coca Cola.
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All thanks to a disgruntled retailer of Coca Cola.
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Pepsi Cola was first developed in 1894 by Caleb Bradham. This was around the same time when Coca Cola started. Pepsi was initially known as Brad's drink & was rechristened to Pepsi Cola in 1894.
By 1910, Pepsi had achieved modest success with franchise bottlers in 25 states.
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By 1910, Pepsi had achieved modest success with franchise bottlers in 25 states.
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In 1920, Pepsi almost went bankrupt due to high fluctuations in sugar prices.
In 1922, Bradham tried selling to Coca Cola. But, Coke didn't show any interest. A wall street speculator, Roy Megargel bought Pepsi from Bradham.
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In 1922, Bradham tried selling to Coca Cola. But, Coke didn't show any interest. A wall street speculator, Roy Megargel bought Pepsi from Bradham.
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The company continued to struggle and had only two bottlers left by 1931. Almost bankrupt again, Roy tried to sell Pepsi to Coca Cola for the second time. And again the offer was rejected.
The end of Pepsi seemed inevitable.
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The end of Pepsi seemed inevitable.
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But, one of the old retailer of Coca Cola, Charles Guth gave Pepsi a new life.
Charles was handling Loft candy stores through which he used to sell Coca Cola. But he wanted to get bulk discount from Coke. He called Coca Cola's office multiple times but received no response.
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Charles was handling Loft candy stores through which he used to sell Coca Cola. But he wanted to get bulk discount from Coke. He called Coca Cola's office multiple times but received no response.
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Angry with no responses from Coke, Charles stopped selling Coke in his stores. And managed to buy Pepsi Cola from Roy which he started serving in his Loft stores.
Charles managed to increase the distribution of Pepsi in the midst of lawsuits from Coca Cola....
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Charles managed to increase the distribution of Pepsi in the midst of lawsuits from Coca Cola....
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In 1934, Charles approached Coca Cola again to buy out Pepsi for 50k $. Coke refused again.
Charles got furious and decided to make Coke pay for their arrogance. Coca Cola used to sell 6.5 oz bottle for 5 cents. Charles launched 12 oz bottle of Pepsi for the same 5 cents.
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Charles got furious and decided to make Coke pay for their arrogance. Coca Cola used to sell 6.5 oz bottle for 5 cents. Charles launched 12 oz bottle of Pepsi for the same 5 cents.
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The additional cost of 12 oz quantity compared to 6.5 oz quantity was very minimal. So for Pepsi, it was not a problem.
Given that USA was just coming out of the great depression of 1929, Pepsi Cola's double quantity at the same price was an instant hit across the country.
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Given that USA was just coming out of the great depression of 1929, Pepsi Cola's double quantity at the same price was an instant hit across the country.
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In the year 1934, Pepsi generated sales of 450,000 $ and profits of 90,000 $. And continued to grow from there on....
A company that almost went bankrupt twice is one of the largest enterprises of today's world
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A company that almost went bankrupt twice is one of the largest enterprises of today's world
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