00:00Pepsi bought three failing fast food chains, made beverage sales hit $30 billion 1977.
00:06Pepsi is losing the cola wars, badly.
00:09Coca-Cola dominates, 50% market share.
00:12Pepsi, 25%.
00:13Distant second.
00:15Every restaurant serves Coke, McDonald's, Burger King, Wendy's, all Coke.
00:19Pepsi is locked out.
00:20No fountain presents, no restaurant deals, losing billions in sales.
00:24Then CEO Don Kendall has an idea.
00:27If we can't get into restaurants, let's buy the restaurants.
00:30His board thinks he's crazy.
00:32We're a beverage company, not a restaurant company.
00:35This is idiotic, but Don sees the play.
00:381977.
00:39Pepsi buys Pizza Hut, $300 million.
00:42Then 1978.
00:44Taco Bell, $148 million.
00:46Then 1986.
00:48KFC, $840 million.
00:51Three failing fast food chains, all struggling, all losing money.
00:55Wall Street mocks them.
00:56Pepsi is desperate.
00:58This will destroy them.
00:59Stick to soda.
01:00But here's the genius.
01:01Pepsi controls what they serve.
01:03Every Pizza Hut, only Pepsi.
01:05Every Taco Bell, only Pepsi.
01:0730,000 restaurants worldwide, guaranteed Pepsi.
01:11Coca-Cola is locked out, completely.
01:13The fountain sales explode.
01:15Billions of gallons, every year.
01:17Captive audience.
01:18Then the ripple effect.
01:19Other chains notice.
01:20Pepsi owns restaurants now?
01:22Maybe we should partner.
01:23Subway switches to Pepsi.
01:25Arby's switches.
01:26By 1990s, Pepsi's restaurant division does $10 billion annually.
01:30The beverage division?
01:32$28 billion.
01:33The restaurants drove it.
01:35But there's a problem.
01:36The chains are still struggling.
01:38Operationally.
01:39Pizza Hut losing to Domino's.
01:40Managing restaurants?
01:42Not Pepsi's strength.
01:431997.
01:44Pepsi makes another bold move.
01:46Spins off the restaurants.
01:48Creates Yum!
01:49Brands.
01:50Keeps the beverage contracts.
01:51Forever.
01:51Today, Yum!
01:53has 55,000 locations.
01:55Globally.
01:56All serving Pepsi.
01:57Pepsi's beverage revenue?
01:58$86 billion annually.
02:01All because Don bought failing restaurants.
02:03Not to run them.
02:04To control the taps.
02:05The takeaway?
02:06If you can't win the channel,
02:07buy the channel.
02:08Then own distribution forever.
02:10Follow for more innovations history.
02:12All seventy,
02:27the giveaway was toujours delivered.
02:27To these thatпер universities were also a熟金 have over a country of competition.
02:30When you do that,
02:31you don't have to look for itself.
02:33So you can also see the alerts.
02:33I'm not at all.
02:35If thisestra has gotten its official,
02:36you can't motivate me.
02:37You can't win the car car.
02:38I'm not at all.
02:38But when you're here,
02:39you can't win the car.
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