PepsiCo improves warehouse throughput 20% and reduces capex 10-15% with AI-powered digital twins

PepsiCo operates a global consumer packaged goods supply chain, spanning a network of manufacturing plants and distribution facilities — a footprint the company describes as extending 'from farm to shelf.' Modifying warehouse layouts, reconfiguring conveyor systems, or testing new distribution strategies required physical changes to live infrastructure, risking costly downtime and operational disruption at scale. Traditional planning cycles for supply chain configuration stretched over weeks or months.

In January 2026, PepsiCo announced a multi-year partnership with Siemens and Nvidia, deploying physics-based digital twins across its US plants and warehouses using Siemens' Digital Twin Composer software, built on Nvidia's Omniverse platform. The system constructs physics-accurate virtual replicas of warehouse environments — modeling layouts, conveyor systems, operator movements, and pallet flows. Supply chain planners can test configurations, identify bottlenecks, and validate equipment placement entirely within the simulation, without touching physical infrastructure. Multiple scenarios are evaluated simultaneously, accelerating decision-making processes that would traditionally take weeks or months. Siemens' solution creates industrial metaverse environments that merge digital twin data with real-time physical information, providing visibility across warehouse operations, inventory flows, and logistics networks throughout each facility's lifecycle. The initiative began as a pilot across select US locations, with a planned rollout to PepsiCo's global network.

Early pilot results show a 20% improvement in warehouse throughput, achieved alongside near-complete design validation. Capital expenditure was reduced by 10–15% in the same early trials. The technology could allow PepsiCo to detect up to 90% of operational issues in simulation before changes reach the warehouse floor, reducing costly errors and minimizing downtime during implementation phases. Key outcomes at a glance:

• +20% warehouse throughput in early trials
• 10–15% capex reduction in early trials
• Up to 90% of operational issues could be detected in simulation before implementation
• Near-complete design validation

Leadership described the deployment as 'the first digital blueprint that reimagines how the supply chain is designed, built and scaled, a first for the industry.'

• Physics-based simulation of conveyor systems, operator movements, and pallet flows lets planners validate layouts and equipment placement before touching physical infrastructure.
• Partnering with established platform vendors (Siemens for industrial software, Nvidia for simulation infrastructure) can provide the technology foundation for a digital twin program.
• Pilot in a controlled set of facilities first — PepsiCo is starting in select US locations, with plans to scale globally.
• Design the end state as a supply chain whose facilities anticipate and then adapt to demand, not just respond to it.