COVID-19 exclusive: Shifting of the Paradigm with Aamer Sheikh, PepsiCo – MENA & Pakistan

“The health and wellbeing of our consumers, employees and the wider community – including any recipients of relief efforts – is our primary focus”, mentioned Aamer Sheikh, President and General Manager at PepsiCo MENA & Pakistan, during an exclusive Q&A session with our Editor in Chief on the impact of COVID-19 outbreak on food and beverage industries globally and specifically in MENAP region.

1. How do you think industry as a whole is coping with this recent crisis?
When the full reality of COVID-19 hit the global community this year, there was no playbook to pull off the shelf, dust off and begin implementing. For many companies that have risen to the challenge, their ‘purpose’ has guided their response.

At PepsiCo, we quickly recognized the profound nature of COVID-19 and its potential impact on how we operate and were swift to implement a number of measures that focused on health & safety, community support, continuity and value, and enhanced accessibility via delivery aggregators.

Our response can be summarized by six guiding principles:
Be people centric: We communicated clearly during a very confusing period and rolled out safety measures to protect our colleagues through various initiatives including social distancing, mandatory use of masks, working from home measures, increased frequency of deep cleaning in our facilities and regular communication.
Be consumer centric: We supported consumers in a meaningful way and adjusted brand activities for those with new needs. For example, last month, in partnership with Global Citizen we supported the ‘One World: Together at Home’ digital broadcast designed to support frontline healthcare workers and the WHO. We also rolled out the biggest online gaming competition in Pakistan – the Dew Gamers Arena 2020 for Gen Z, which has already received a record 12,000 registrations and 13 million views.
Be customer centric: We worked closely with our plant and retail partners to maintain continuity and deliver the much-loved PepsiCo products to people with minimal disruption and at great value via promotions. We are also rolling out initiatives like Tell-Sell across all franchises in Pakistan, which will make order booking convenient, cost-effective, and safe.
Be community stewards: Along with the PepsiCo Foundation and our bottling partners, we have launched a ‘Millions of Meals’ program. Through this program we are distributing Millions of Meals to those most impacted by COVID-19 with the help of reputable partner NGOs. So far, we have distributed over 2.6 Million meals. The program has national scale to cover all provinces of the country.
Be agile: We quickly recognized the profound nature of COVID-19 and its potential impact on how we operate and implemented several measures across different pillars of our business, including activating multiple e-commerce platforms and offering web exclusive promos and bundles, leading to a 38% month-on-month growth of e-Commerce sales in March.
Be prudent: We planned ahead, adapted our investments, and are working closely with our government, bottlers and retail partners to respond to challenges as they develop.

2. Since lock-downs are in place mostly everywhere, what initiative has your company taken to overcome logistics issues and at the same time ensuring minimal health and safety risks for your staff and partners?
In close collaboration with our bottling partners, we are taking every precaution across our supply chain and continue to work closely with authorities across our businesses and around the world to ensure the continued safety of our people, products and manufacturing locations everywhere we do business.

Guided by the principle of remaining people-centric, we have also canceled all participation in face-to-face meetings for employees and instituted a flexible working policy for roles that can be done remotely. All air and long-distance rail travel continues to be limited, and crisis management teams are in place to tailor our response locally.

Our bottlers are also following PepsiCo global standards in enforcing strict preventive safety and sanitation measures in all of their manufacturing and warehouse locations, including staggering shift changes, increased cleaning, and separating workstations.

As the scientific and medical guidance continues to evolve, we will continue to adjust our approach and response to ensure the health and safety of our products, associates and their loved ones.

3. Do you reckon it will be business as usual post this crisis or there will be massive changes in the way businesses have been conducted?
COVID-19 continues to be a developing situation and is one that is without precedent so it would be premature to speculate on how it will impact businesses in the mid to long term.

However, referring to our Q1 earnings update, we are buoyed by recent performance and remain cautiously optimistic. We believe PepsiCo is well-positioned to come out of the pandemic even stronger because consumers love and trust our brands, we have strong positions in growing categories like foods and snacks, an agile supply chain with strong local sourcing networks, a flexible and advantaged direct store delivery go-to-market system, and an experienced team of global leaders who are empowered, and have the knowledge and agility to make rapid, decentralized decisions to meet the needs of their local businesses.

What the future of COVID-19 holds for us is still unknown but what is clear is that companies that stay true to their purpose and act quickly, authentically and with integrity, will emerge stronger post this crisis.

4. Do you think there are any positive impacts to the business and working environments?
COVID-19 is a developing situation, and health authorities, governments and the private sector across the globe have raced to assess, adapt and implement action plans to respond to the crisis as best as they could. The public and private sectors are working closely to keep large businesses sustainable, support small businesses, help vulnerable communities, and push the wheels of the economy to minimize the impact of the crisis.

From an operational point of view, at PepsiCo we have focused our efforts on ensuring that consumers continue to enjoy their favourite products with limited disruption and at great value. Our frontline heroes have been working tirelessly to keep shelves stocked, and we’ve adapted to changing circumstances swiftly by partnering with local delivery aggregators to deliver even greater accessibility to those at home.

In terms of products, with more consumers eating breakfast at home, the Quaker business has seen an uptick and Frito-Lay has also continued to perform well. Our Q1 earnings have revealed that globally, our organic revenues have grown 7.9% with our drinks, snacks, and food sectors, all having gained. In our region specifically (Africa, Middle East and South Asia), our food and snacks business has seen a 13% jump in organic volume, and our beverages business an 11% jump.

As far as the working environment goes, organizations are learning to be more flexible, agile, and act with speed, particularly as more employees work from home and digital technology becomes more important than ever. According to insights by the World Economic Forum, workers and businesses are not only learning digital skills, but also improving auxiliary skills such as collaboration, creative problem-solving and openness to new ideas, as managers learn how to motivate and engage teams from afar. This is at the core of what we’re guided by at PepsiCo – staying agile and prudent. Additionally, those who are now gaining more time in the day because they no longer have to factor in a commute, are use the time to gain new skills and plan ahead.

Another silver lining to the crisis has been the proactive response from organizations to accelerate support for communities and employees. At PepsiCo for instance, we have prioritized health and safety, employee well-being, and community support, and invested in providing millions of meals across the country, focusing on providing nutritious meals to those most at risk.

5. On what parameters do you measure consumer behavior amidst quandary?
Our consumers have continued to enjoy PepsiCo products during this period with limited disruption and at great value. We have also adapted to changing needs and in line with increased demand for home delivery, partnered with delivery aggregators to deliver even greater accessibility to those at home.

At PepsiCo, we remain close to measuring and analyzing consumer and shopper insights to ensure we are designing our plans to address these insights. We’ve observed and anticipate consumer trends to skew more heavily towards value and convenience, with online shopping becoming more popular because of its ease, accessibility, and convenience.

From a volume and performance perspective, I can only really speak to PepsiCo’s performance during Q1, which was revealed on an Earnings call recently:

• Globally, our organic revenues have grown 7.9% with our drinks, snacks, and food sectors, all having gained.
• In terms of products, with more consumers eating breakfast at home, the Quaker business has seen an uptick.
• Frito-Lay has also continued to perform well as snack grazing is on the rise with consumers spending more time at home.
• In our region specifically (Africa, Middle East and South Asia), our food and snacks business has seen a 13% jump in organic volume, and our beverages business an 11% jump.