...PROJECT PLAN Competitive Advantage of the Coca Cola Company: Porter’s Competitive Force Model and the Business Value Chain Model This plan outlines the Competitive Advantage of Coca Cola Company regarding Porter’s Competitive Force Model and the Business Information Value chain. The purpose of the plan is to provide the general view of the firm, its competitors, and the environment it operates. The five competitive forces of Porters model shape the fate of the firm through; Customers and suppliers, substitute products and services, traditional competitors, and new market entrants. This project plan will take up to 4 week, using Porter’s Competitive Force Model to identify the firm’s competitive forces and highlight specific activities in the business where competitive strategies can best be applied and where information technology helps and the impact it brings to the company competitive position. PROJECT SCHEDULE Task: Management Information System Project Duration: Four (4) Weeks Due Date | Day | Time | Job Specification | Lecture’s Approval | Comment | O9/10/15 | Friday | 11 am | Introduction and Background of the company | …………..Date: | | 16/10/15 | Friday | 11 am | Industrial Analysis: * Porter’s Five Forces Model * Business Value Chain | …………….Date: | | 23/10/15 | Friday | 11 am | Firms Competitive ForcesExternal Environment * Strength WeaknessInternal Environment * Opportunity & Threats | …………..Date: | | 30/10/15 | Friday | 11 am...
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...Applying Five Force to Almdudler Introduction Almdudler is a self-confident brand that continuously displays the determination to be successful in the marketplace. They seem extremely optimistic and assured that their brand can eventually reach high plateaus. According to the article their numbers are continuously rising throughout. With increases such as 1.7 percent in Austria and increases internationally through exports, it seems that this brand has an extremely bright future. Furthermore, the article states that consumers worldwide are beginning to be familiar with the brand. With Almdudler preparing to enter the US market their plans to diversify their brand with different types of drinks seems promising. However, is that enough to draw American buyers? It will be a significant challenge for Almdudler to be successful in a country that has a soft drink industry that is tremendously competitive and diverse. Five Force Model: Threats of Substitute Markets One of the aspects in the five force model is threats and substitutes from other companies. The main traits of this category are: • product differentiation • and what aspects would attract consumers to this particular brand of soft drink. Although awareness for Almdudler has risen significantly internationally, in this particular industry, Coca Cola remains dominate. Globally its diverse brand of soft drinks and juices, has for many years...
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...Numerous economic studies have affirmed that different industries can sustain different level of profitability; part of this difference is explained by industry structure. Michael Porter provided a framework that models an industry as being influenced by five forces. A strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates. In this paper I will use the five force model, as a Coca-Cola Company Business Manager to understand the Cola industry and try and develop an edge over rival firms. We will discuss each of the models individually and develop an understanding of where Coca Cola stands. Threat of New Entrants: Penetrating the soft drink industry is hard because of the established name of Coca-Cola and the other following reasons: Brand Image: Coca Cola invests enormous amount of money in marketing and advertising which has led to customer loyalty all over the world. People might not recognize Bill Gates or Warren Buffett if they are on a television show, but even a child who cannot read will recognize Coca Cola on television. We ran into a similar situation in the class room when the professor recognized a can of Coca Cola without even looking at the name printed on it. This makes it next to impossible for a new entrant to get in the market and compete with Coca Cola. Advertising: As mentioned above Coca Cola spend enormous amount of money on marketing and advertising,...
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...Coca-cola Introduction Coca-Cola Amatil (CCA) is the Australia's market leader in the manufacture and distribution of soft drinks, including Coca-Cola, Fanta, Sprite and Mount Franklin (CCA,2010). It operates its company in different countries in Asia-Pacific regions: Australia, Indonesia, New Zealand and Fiji. Coca-Cola was introduced to Australia in 1937 and the first manufacturing plant was also begun operating in Sydney in 1938. In this essay, I will use the 5 competitive forces model to discuss in context of CCA providing a general view of the company, its competitors and company's environment. Competitive Forces According to Porter's competitive forces model, there are five competitive forces, traditional competitors, new market entrants, substitute products, customer bargaining power, supplier bargaining power and services (QuickMBA.com n.d.). These can help managers to know about the industry in which the company operates. The model can also locate situation of the company in order to make relevant decision towards to the problem and create competitive advantage (Porter 2008). The force of traditional competitors is high in beverage industry because there have many companies selling same products in the market. In order to have higher market share, competitors trend to set lower price and introduce new products attracting more customers to buy. This will lead high level of price competition in the market. Competitors always introduce new products and services...
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...PepsiCo’s Five Forces Analysis PepsiCo’s world-wide success is related to its business capabilities, especially in overcoming the challenges and problem shown in this Porter Five Forces analysis. Michael Porter developed the Five Forces analysis model to determine the most significant external factors that influence Company. For PepsiCo to maintain its market rank as the second largest food-and-beverage company in the world, it must show the potential problems identified in this model. PepsiCo also needs to continually adjust its strategies to effectively respond to the external factors significant in the food and beverage industry competition A Five Forces model analysis of PepsiCo reveals that the companyshould prioritize the effect of competition and the influences of consumers and substitutes. These forces shape PepsiCo’s strategies.. Because of the global nature of its business, PepsiCo faces varying in external factors in its industry environment. However, the overall result of these factors and the corresponding that model are summarized as the given below , with indicators of the strengths of their forces of model on PepsiCo: 1. Competitive rivalry or competition 2. Bargaining power of buyers or customers 3. Bargaining power of suppliers 4. Threat of substitutes or substitution 5. Threat of new entrants or new entry Competitive Rivalry or Competition with PepsiCo (Strong Force) – The Coca-Cola Company is one of most PepsiCo’s...
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...Conducting a PEST and a Porter's five forces analysis on the entire business operations of Coca Cola Company will play part in deriving the various opportunities and threats that the company faces. The scope of the analysis will involve the entire coca cola company. The appropriate NAISCS code for the company is 312111 (DATAMONITOR: The Coca-Cola Company, 2011). Introduction: Coca Cola Company is the leading company in the production of non alcoholic beverages and drinks throughout the globe. The company has its headquarters in Atlanta where it has a total of 139,600 employees. The company serves over 200 countries around the globe (DATAMONITOR: The Coca-Cola Company, 2011). Porter's 5 Forces: Porter's five forces will provide an overview of the supplier power, the existing threats of new entrants, threat of substitutes, buyer power, and the degree of rivalry which results to rivalry being born. Various industrial characteristics available in the beverages industry where Coca cola is located has resulted to the development of rivalry. Low levels of product differentiation are one on the factors which has led to the development of rivalry. Looking at the threat of substitutes which is characterized as low, Coca cola's price elasticity is not affected by the substitute products since the company has a limited number of substitutes when it comes to the products that they purchase. The level of the existing price competition of Coca Cola Company is therefore considered to...
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...Executive Summary The Company for analysis is the Coca-Cola Company. It operates in the soft drinks industry. This company is known to be among the oldest companies that manufacture non-alcoholic beverages. Among the main competitors of Coca-Cola is Pepsi. Coca-Cola is a multinational that has subsidiaries in almost every corner of the globe. It is a publicly traded company with a current market price for its stock at 46.39 % as at 31st March 2016 which translates to a deviation of 0.41%.An analysis of Coca-Cola Company reveals that Coca-Cola is currently grappling with issues related to its market share, quality of its soft drinks and production processes. These problems have in turn decreased their market share and its competitive advantage. Competitors have taken this as the advantage to increase their sales and revenue. The notable competitors for Coca-Cola Company are Pepsi, Nestle S.A, Dr. Pepper Snapple group inc., and Nestle Waters France. This study undertakes an analysis of Coca-Cola's industry with an aim of finding the root causes of these problems and how Coca-Cola can overcome them. Michael Porter’s five forces model, ratio analysis, analysis of market capitalization, business model, and strategy are some of the main approaches that this study applies in analyzing the Coca-Cola Company. Nevertheless, the Coca-Cola Company remains competitive, and investors should not avoid from investing in Coca-Cola. Coca-Cola produces several brands of non-alcoholic beverages, energy...
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...Cola Wars Continue: Coke and Pepsi in 2010 I. Key Problem For many years, Coke and Pepsi have been the two largest soft drink companies competing for the highest market share in the nation and the world. The Coke formula was created in 1886 by John Pemberton, and later acquired by Asa Candler, who expanded the coke formula and converted it into syrup, which was then sold to bottlers to produce carbonated drinks. Coca-Cola had great success during World War II; the brand expanded internationally with the help of the U.S Government. The company promised Coca-Cola to U.S soldiers for five cents, regardless of its production cost. An estimated 64 Coca-Cola bottling companies were opened overseas resulting in a positive overall company market share in Europe and Asia. Since 1950, Coke’s marketing strategy has always been targeting family consumption, especially in supermarkets. In addition, Coke has mainly focused on fountain sales at major restaurant franchises, like McDonalds and Burger King. They are considered Coke’s main source of revenue. Throughout the years and due to demand, Coke has created non-cola flavored carbonated drinks such as Fanta, Sprite, etc., to broaden their carbonated drink consumption. Later on, the company purchased Minute Maid, Duncan Foods, and Belmont Springs Water. Coke also expanded its brand with the creation of Diet Coke. Diet Coke was a huge success for the company, making it the nation’s third-largest-selling carbonated soft drink...
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...PepsiCo: External Considerations Overview PepsiCo is popularly associated with its flagship product Pepsi Cola. While Pepsi Cola is a sizable portion of PepsiCo’s revenue stream, PepsiCo actually has significant revenue generated from a slew of other products and divisions such as PepsiCo Beverages North America, PepsiCo International, Frito-Lay and Quaker Foods North America (Overview, 2005). PepsiCo’s Pepsi Cola has long been second in market share to Coca-Cola and the competition between Pepsi and Coke has been the stuff of business school legend for many years. However, thanks to a series of strategic acquisitions and market entry moves internationally, PepsiCo as a company has finally overtaken Coke in overall market share and performance: “PEPSICO...has raced ahead of...Coke in overall growth rates. PepsiCo earnings last year surged 18% to $4.2 billion on revenues of $29.3 billion, up 8.5%...Coke's 11.5% earnings growth to...4.4% revenue growth to $22 billion for 2004” (Steiner, 2005, para.2). It could be said that PepsiCo has lost the cola battle but won the overall war with its archrival Coca-Cola Company. PepsiCo has done this by becoming a snack food and beverage Company with operations in more than 200 countries worldwide, over 143,000 employees both national and international and over $4 billion in revenues (PepsiCo, 2004, p.4). Increasingly, PepsiCo, as most other large MNCs have done, is relying on overseas expansion to fuel its future growth and earnings...
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...unique product as well as the market share from other competing companies such as Samsung. Although the company produces other household product, Nokia mobile is the main product of the company (Worley et al., 2011). Porter’s five forces of Nokia Company. The Nokia Company faces the porter’s five forces of completion in its daily operation. The forces include the entry by other firms, power of the buyer, power of supply, competitive rivalry and substitute goods (Rampersad & Hussain, 2014). 1. Entry by new firms The threat to entry by other firms in the market is quite low as the company has established its strong market share in the mobile phone industry. The forces are low because new companies who wish to venture into the industry have to invest heavily in terms of innovation and marketing (Rampersad & Hussain, 2014). 2. Power of suppliers The threat of power of supply is moderate as the company can acquire the new materials from many equipment suppliers. Therefore, the company can easily negotiate and bargain with the willing mobile phone hardware (Steers et al., 2010). 3. Powers of buyers The company faces a high force of power of buyers because the consumer can decide to buy the product from other companies. The mobile phone industry is very wide, and the consumer are face with a variety of product to choose if they fell that the Nokia products are not the best (Garratt, 2003). 4. Substitute of products The threat of substitute product is low as the phone...
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...Porters 5 forces that was developed by Michael Porter in 1979 focuses on 5 main factors that can help the FMCG companies and determine the industry that a company wants to join or enter into. The Porters 5 forces will show if it is profitable for a company to enter the market based in the 5 criteria’s. Porter’s main plan was to understand the forces and the underlying causes that reveals the basis or foundation in an industry’s profitability while allowing to identify the current and the future incoming competition (Arline, 2015). According to Michael E. Porter the origin of profitability will not change regardless of the type of the industry that a company will operate in. But what will drive competition and the profit making ability will be structure of the industry, and not the fact that the industry is producing goods or services, is developing or matured in the market. Porters 5 Forces Model Source: (Masonmyers.com, 2016) Applying the porter’s five forces into Fmcg companies. Threat of new entrants. Coca cola is a well-known beverage company that falls into the FMCG category. They aren’t just a company but also hold a very strong brand name. Coca cola faces a medium risk of new entrants. They reap economies of scale and thus enjoy very low average cost making it hard for new entrants to enter the beverage market. And also the fact that Coca cola has been operating in the market for a very long time, their products are popular around the world in almost every country...
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...“Cola Wars – Sustaining Competitive Struggle” I. Key Problem In the current business world the competition is very stiff. Major organizations are stressing on every possible resources to meet continuing rising demands of market and consumers. The prime aim for the current organizations is to render best services to their customers and increasing the market share. The current globalization scenario also provides ample opportunity for an organization to interact and present them globally. The integration with global economies allows them to sell their product and services on global platform. This also brings modernization and industrialization. Coca-Cola was established in 1886 originally as a coca wine to serve as “potion for mental and physical disorders”. In year 1891 the brand advertisement for Coca-Cola was developed and went in market / broad consumer range under established sales force. By leveraging and pushing the pool of bottlers under them, the company went public and emphasized on the opportunity to put the beverage “in arm’s reach of desire”. To fulfill their desire to top the world as leading beverage suppliers, they won 4 of the world’s top 5 nonalcoholic beverage brands and they have setup operations in more than 200 countries all over the world with a strong portfolio of more than 2,800 products in these countries. On the hand, Pepsi Cola was founded in 1893. Following footsteps of coke, Pepsi also adopted franchise bottling system. Overcoming financial and...
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...Cola Wars Case Study DMBA 630 Marketing and Strategy Management in the Global Markeplace Introduction Carbonated Soft Drinks (CSD) have been around for over a century and now accounts for a $60 Billion market with the average American consuming about 53 gallons a year. Coca-Cola was invented in 1886 by John Pemberton as a “potion for mental and physical disorders.” Asa Candler acquired the formula and began marketing it as Coca-Cola. The first bottling franchise was accorded in 1899 for a sum of one dollar. Pepsi-Cola was invented in 1893 by Caleb Bradham a pharmacist from North Carolina. Pepsi also franchised its bottling operations. Pepsi struggled over the years going bankrupt twice within a decade, first in 1923 and again in 1931. Pepsi competed aggressively against coke offering almost twice the amount of Pepsi for the same price in the 1930s. Coca –Cola or Coke on the other hand was the market leader through the early 20th century with numerous imitators popping up trying to clone Coke. Coke fought back in the courts to aggressively deter imitators and counterfeiters. During the 1920s and 1930s, Coke was marketed to multiple market segments making it available to anyone desiring the brand. Eventually Coke sued Pepsi for trademark infringement in 1938 and lost. Pepsi gained market share and became a titan competitor in the market for CSDs beating out all other brands except Coke. Thus began the “Cola Wars” in 1950 with Pepsi’s aggressive “beat Coke”...
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...Drinks, other Beverages Case Study 2 The beverage industry has been rapidly growing for many years now. New products are being produced, as well as old products being refined. One of the largest markets thus far, beverages are continuously changing and being tinkered with. We look at a few different types such as, energy drinks, sports drinks, and vitamin-enhanced beverages. With different corporations comes different success factors. Some success factors for the beverage industry consist of rapid growth in category, premium prices, and high profit margins. Coca Cola and PepsiCo have been expanding on numerous different flavors, holding to the same products and production line. By expanding the “line up”, companies can expand their production, as well as profit and the business as a whole. “As consumer preferences shifted during the 2000s, sports drinks, energy drinks, and vitamin- enhanced drinks had grown to become important segments within the industry in 2010.” [Gamble C 76]. Noticing that most of the energy drinks are vitamin based, the growth of these products has been positive. Looking at Exhibit 1, we understand and can see the growth and volume sales over the years between 2005 and 2014. This chart pictures a constant growth based on the growth determined within prior years. The Five-Forces Model of Competition, is a key analytical tool in organizing a model based on buying and selling. The Five Forces are considered to be: firms with substitute products, rivalry...
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...entry: It is very common that the existing company in a industry will set the barrier to the new entrants. Because these new entrants might become the strong potential competitors in the future and take away large profit from the existing company. For these new entrants, they will carry out pretty attractive competition and use better financial strength to seize current and potential market. These moves will lower the benefits of existing business and the return of investment. To prevent this situation happen, Coca-Cola will set different barriers to discourage the potential entrants. I will discuss other enter barriers. Product differentiation One of the most important factors to determine whether a business can be successful is whether they have the compared advantages. It is very important to use the differentiation strategy to make your products known by the customers. Products that easy to remember and recognize by the customers are different from others. This difference can be the service of the company, the high quality, the name of brand. All of these characteristics will set up the customers loyalty in the market. Under the advantage of differentiation strategy, even though the new entrants maybe try their best to attract the customers with lower prices or other things, they may still suffer a loss in profit because the loyalty of the customers. Capital requirement Whenever and wherever people decide to entry a industry, he has to have enough capital recourses to support...
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