KFC switch to Coke puts PepsiCo’s food service ties in focus, analysts say
On October 16, KFC announced it would be switching from Pepsi sodas to Coca-Cola at its US restaurants. This move, according to analysts, could raise concerns about PepsiCo's other important food service partnerships, despite expecting the financial impact to be manageable. The loss of KFC translates to about $500 million in annual sales for PepsiCo, equivalent to a 3% hit to Pepsi Beverages North America's concentrate sales, and a 2.5% boost to Coca-Cola's North America sales.
While some brokers believe the primary concern for PepsiCo is the loss of brand interaction and public perception, others see this shift as a natural reassertion of a brand.
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