Documente Academic
Documente Profesional
Documente Cultură
BY
Yousaf Abbasi
Executive Summary
1. INTRODUCTION.................................................................................................................................4
1.1 History................................................................................................................................................4
6.1. Strengths.........................................................................................................................................9
6.2. Weaknesses....................................................................................................................................10
6.3. Opportunities.................................................................................................................................10
6.4. Threats...........................................................................................................................................11
7. HOW THE COCA COLA CAN GAIN COMPETITIVE ADVANTAGE IN RESPECT OF THE
EXTERNAL FACTORS AND FORCES............................................................................................11
8. CONCLUSION................................................................................................................................13
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9. REFERENCE LIST........................................................................................................................14
1. Introduction
The Coca-Cola Company is the world’s leading soft drink maker, operates in more
than 200 countries and sells 400 brands of non-alcoholic beverages. Coca-Cola is also
the most valuable brand in the world. Coca-Cola is a globally recognized successful
company. The Coca-Cola was founded in May of 1886 and continues for more than a
century through the times of war and peace, prosperity and depression and economic
boom and bust. As late as the 1990s, Coca-Cola was one of the most respected
companies in the world, known as a very successful management team. Since 1998,
the company has been struggling with internal weaknesses and external threats.
The purpose of this case study is to assess the current situation of Coca-Cola and
the industry, evaluate the existing resources, and provide strategic recommendations.
1.1 History
It was 1886, and in New York Harbor, workers were constructing the Statue of
Liberty. Eight hundred miles away, another great American symbol was about to be
unveiled.
Like many people who change history, John Pemberton, an Atlanta pharmacist,
was inspired by simple curiosity. One afternoon, he stirred up a fragrant, caramel-
colour liquid and, when it was done, he carried it a few doors down to Jacobs'
Pharmacy. Here, the mixture was combined with carbonated water and sampled by
customers who all agreed -- this new drink was something special. So Jacobs'
Pharmacy put it on sale for five cents a glass.
Pemberton's bookkeeper, Frank Robinson, named the mixture Coca-Cola®, and
wrote it out in his distinct script. To this day, Coca-Cola is written the same way. In
the first year, Pemberton sold just 9 glasses of Coca-Cola a day.
A century later, The Coca-Cola Company has produced more than 10 billion
gallons of syrup. Unfortunately for Pemberton, he died in 1888 without realizing the
success of the beverage he had created.
Over the course of three years, 1888-1891, Atlanta businessman As a Griggs
Candler secured rights to the business for a total of about $2,300. Candler would
become the Company's first president, and the first to bring real vision to the business
and the brand.
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2. BUSINESS PLANNING AND STRATEGY USED IN THE
COCA-COLA COMPANY
2.1 Mission, Vision & Values
The world is changing all around us. To continue to thrive as a business over
the next ten years and beyond, we must look ahead, understand the trends and forces
that will shape our business in the future and move swiftly to prepare for what's to
come. We must get ready for tomorrow today. That's what our 2020 Vision is all
about. It creates a long-term destination for our business and provides us with a
"Roadmap" for winning together with our bottling partners.
People: Be a great place to work where people are inspired to be the best
they can be.
Portfolio: Bring to the world a portfolio of quality beverage brands that
anticipate and satisfy people's desires and needs.
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Profit: Maximize long-term return to shareowners while being mindful of our
overall responsibilities.
Integrity: Be real
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4. PEST ANALYSIS OF THE COCA-COLA COMPANY
4.1 Political Analysis and Factors
Those Non- Alcoholic Beverages like; Coca-Cola, are within the food category,
under the FDA (Food and Drug Administration). The government has control over the
manufacturing procedure of these products in terms of regulations. Companies, who
fail to meet the standards of law, are fined by the government. Following are provided
some of the factors that are influencing Coca-Cola's Operations.
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advance its research of new products and technology. By researching for new products
are cost effective, the company could sell its products at a lower price, so its
customers would purchase more Coca-Cola products at a lower price.
Most extensive beverage distribution channel. Coca Cola serves more than
200 countries and more than 1.7 billion servings a day.
Customer loyalty. The firm enjoys having one of the most loyal consumer
groups.
Bargaining power over suppliers. The Coca Cola Company is the largest
beverage producer in the world and exerts significant power over its suppliers
to receive the lowest price available from them.
6.2. Weaknesses
Significant focus on carbonated drinks. The Coca Cola Company is still
focusing on selling Coke, Fanta, Sprite and other carbonated drinks. This
strategy works in short term as consumption of carbonated drinks will grow in
emerging economies but it will prove weak as the world is fighting obesity and
is moving towards consuming healthier food and drinks.
Undiversified product portfolio. Unlike most company’s competitors, Coca
Cola is still focusing only on selling beverage, which puts the firm at
disadvantage. The overall consumption of soft drinks is stagnating and Coca
Cola Company will find it hard to penetrate to other markets (selling food or
snacks) when it will have to sustain current level of growth.
High debt level due to acquisitions. Nearly $8 billion of debt acquired from
CCE’s acquisition significantly increased Coca Cola's debt level, interest rates
and borrowing costs.
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6.3. Opportunities
Bottled water consumption growth. Consumption of bottled water is
expected to grow both in US and the rest of the world.
Increasing demand for healthy food and beverages. Due to many programs
to fight obesity, demand for healthy food and beverages has increased
drastically. The Coca Cola Company has an opportunity to further expand its
product range with drinks that have low amount of sugar and calories.
6.4. Threats
Changes in consumer tastes. Consumers around the world become more
health conscious and reduce their consumption of carbonated drinks, drinks
that have large amounts of sugar, calories and fat. This is the most serious
threat as Coca Cola is mainly serving carbonated drinks.
Strong dollar. More than 60% of The Coca Cola Company income is from
outside US. Due to strong dollar performance against other currencies firm’s
overall income may fall.
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out. In order for Coca-cola to have higher demands than its competitors it needs to do
something, which makes that product better than the rest.
Having competitive advantage also allows coca cola to get bigger and bigger
through increasing sales or market shares. Getting big are an advantage for coca cola
and its costumers because when a business is big enough and has high output
economies of scale can be achieved.
There are many ways in which a company such as coca-cola may get its
competitive advantage but, the most important and affective way to get competitive
advantage is innovation.
Innovation can be used. This may certainly give coca cola competitive
advantage because it introduces a new product, which many people will want to try.
The advantages of this are that there would be no substitutes. This may mean
monopoly power for a small period of time. This will obviously push up sales by a lot
increasing revenue and therefore increasing total profit. Not only demand (page 3 of
appendix) will increase but also the monopoly is likely to erect barriers to prevent
competition. The fact that it has no substitute would give coca cola inelastic demand
(page of appendix). This is when demand is less sensitive to a change in price. People
will like to purchase the good even though price is high because no substitutes are
available. It may also give coca cola brand loyalty which means customers will stay
loyal to them no matter what happens.
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8. CONCLUSION
There are some challenges that Coca-Cola will face in the future. These challenges
may pose negative impact on the long-term profitability and market share of Coca-
Cola. Therefore, recommendations are provided to turn challenges into opportunities.
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9. Reference List
http://www.coca-colacompany.com/careers/who-we-are-infographic
http://www.coca-colacompany.com/our-company/human-rights-statement
http://www.coca-colacompany.com/our-company/company-reports
http://www.coca-colacompany.com/our-company/leading-the-industry-
refreshing-the-world-responsibly
http://heritage.coca-cola.com/
http://www.strategy-business.com/article/00093?gko=f3ca6
http://www.slideshare.net/Noorafridi90/coca-cola-company-strategies
http://www.slideshare.net/angelynablihan/coca-cola-marketing-plan-11647532
http://www.abrmr.com/download.php?file=18.pdf
https://en.wikipedia.org/w/index.php?
search=the+coca+cola+company+introduction&button=&title=Special
%3ASearch
http://www.scribd.com/doc/10552013/Coca-Cola-Marketing-Strategies
http://www.academia.edu/389600/The_Strategic_Positioning_of_Coca-
Cola_in_their_Global_Marketing_Operation
http://www.coca-colacompany.com/
http://www.cokecorporateresponsibility.co.uk/future-challenges/the-coca-cola-
company-2020-vision.aspx
http://www.coca-colacompany.com/sustainabilityreport/global-
challenges.html#section-we-know-its-not-all-about-us
http://www.coca-colafemsa.com/femsa/web/conteudo_en.asp?
idioma=1&conta=44&tipo=27617
http://ivythesis.typepad.com/term_paper_topics/2009/12/pestle-analysis-on-
coca-cola.html
http://www.strategicmanagementinsight.com/tools/swot-analysis-how-to-do-
it.html
http://ivythesis.typepad.com/term_paper_topics/2009/12/pestle-analysis-on-
coca-cola.html#ixzz2TOlXC5Mf
http://desmondcocacola.blogspot.co.uk/2012/06/pest-analysis-for-coca-
cola.html
http://valuationacademy.com/porters-five-forces-in-action-sample-analysis-of-
coca-cola/
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