Managing the Financial Side of Commercial Fleets

Silva Delivers Productivity and Sustainability for PepsiCo in 2007

July 2008, by Cheryl Knight - Also by this author

Director of fleet procurement, Pete Silva has helped PepsiCo and its divisions manage its growth while keeping financials in line. The PepsiCo and bottler fleets number more than 48,000 U.S. vehicles.

His achievements earned Silva Fleet Financials’ 2008 Fleet Executive of the Year Award. Six exceptional fleet executives vied for this year’s award, presented at NAFA’s 2008 Institute & Expo May 4 in Salt Lake City.

Sponsored by The CEI Group, the award recognizes exceptional leadership by senior executives making significant contributions to fleet vehicle management. A panel of five industry judges evaluated criteria submissions, including cost-saving initiatives, policy setting, innovative programs, and cultivation of fleet manager training and management.

Silva Delivers Productivity and Sustainability Improvements

Silva’s most significant accomplishment at PepsiCo has been developing purchasing synergy between the PepsiCo operating units and its bottlers. Prior to Silva’s leadership, each operating unit executed its own purchasing contracts and processes, which led to an inconsistent vendor base and pricing structure.

By consolidating the purchasing effort, strategic alliances were developed with suppliers, and the operating units could share best practices and benefit from volume leveraged pricing.

“I had a great deal of help from key team members Ralph Schatz, who manages capital programs such as trucks, trailers, and forklifts, and Dennis Selle, who oversees expense programs such as fuels, rentals, and tires,” Silva said.

Silva’s proactive management style has led to several recent successful fleet initiatives resulting in substantial cost and time savings, including:

  • Helping produce more than $1.1 million total fleet savings for PepsiCo in 2007.
  • Testing hybrids in 2005, eventually leading the company to convert its company car fleet to hybrids.
  • Supporting Frito-Lay efforts to redesign its delivery trucks, leading to significant capital savings over the past two years.

PepsiCo is one of the world’s largest producers of convenience snacks, foods, and beverages, with revenues of more than $39 billion and more than 185,000 employees. PepsiCo owns such popular brands as Pepsi-Cola, Mountain Dew, Diet Pepsi, Lays, Doritos, Tropicana, Gatorade, and Quaker. The company’s brands are available worldwide through a variety of go-to-market systems, including direct store delivery (DSD), broker-warehouse, and food service and vending.

Silva has spent 10 of his 25 years at Frito-Lay/PepsiCo within the fleet department. He supervises seven employees; negotiates agreements with truck, car, fuel, and maintenance providers; and oversees fleet agreements for all PepsiCo entities, including Frito-Lay, Tropicana, Naked Juice, Anchor Bottlers, and a number of independent Pepsi bottlers.

 

Pete Silva

 

“I am responsible for delivering purchasing productivity and sustainability improvements for the various PepsiCo fleets,” Silva said. “We gather input on needs from the various operating companies and use that input to align capital and expense agreements for the fleet organization.”

He also manages other goods and services purchasing for the Frito-Lay Division and delivers productivity opportunities to reduce operating costs in Frito-Lay manufacturing plants and distribution centers.

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