This industry as a whole generates positive economic profits. In addition, the producers of the basic commodities for the coke production (like Caramel Colouring, flavour, caffeine or additives, sugar, packaging) have no power over the pricing hence the suppliers in this industry are weak. Revenues are extremely concentrated in this industry, with Coke and Pepsi, together with their associated bottlers, controlling between 70% & 90% of the US retail outlets in 2000 (Exhibit 7). In fact, one could characterize the soft drink market as an oligopoly, or even a duopoly between Coke and Pepsi, resulting in positive economic profits. To be sure, there was tough competition between Coke and Pepsi for market share, and this occasionally hampered profitability.
There was not one dominant player within the industry; they were more equally balanced thus increasing rivalry. The High fixed cost for running a discount store resulted in an economies of scale effect, this can be seen when Wal-Mart decided to gain economies of scale by building their own distribution centres to add value. Going public in order to finance the extra storage was important for Wal-Mart to utilise capacity as efficiently as possible, they did this by creating distribution hub around 15-20 stores. The increased rivalry continues, this was due to the low levels of product differentiation and little in the way of own branding, products were standard in nature through all discount stores. Also the low switching cost and consumer awareness of shopping around to find the best bargains increased competition around stores to capture customers.
These two companies occupied more than 74% market share in 2004. As such companies usually have a better reputation and are better recognized, they could have higher customer loyalty. Therefore, consumers are less likely to switch to other producers. Moreover, economies of scale could also help some incumbents to cut average costs, making it even more difficult for new entrants to survive. The Power of Suppliers Suppliers supply raw materials including caramel coloring, phosphoric or citric acid, natural flavors and caffeine to concentrate producers.
There are winners and losers in this situation. I think Wal-Mart shareholders and customers benefit the most from the company. The company gives its shareholders good returns on their investment and its customers get products at low prices and convenience, by having almost every product they need at one store, especially Wal-Mart supercenter. Customers save money by not having to drive to many different stores, in order to get different products. Although many might argue that Wal-Mart is misleading its customers by using the opening price point, I believe that overall Wal-Mart prices are lower than their competitor’s prices.
I think individual efficiency can suffer by implementing ERP. Hershey is expecting to increase the efficiency of the Production cycle so that he can meet all the purchase orders from the local and global market as well. Mr. Bentz, Vice President Hershey Inc. noted that benchmark studies by the Grocery Manufacturers of America show that Hershey's IT spending trailed that of most of its industrial peers. The study concluded that
Jose G. Ruiz 1000 S. Place Ave. Chicago, IL 60600 September 18, 2012 William W. Douglas, Public Affairs Coca-Cola Bottling Enterprises Inc. 2500 Windy Ridge Parkway Atlanta, GA 30339 SUBJ: Proposal to reduce the amount of plastic used on the bottles that your company, Coca-Cola Enterprises, manufactures for beverages. Dear Mr. Douglas: As a consumer of your company’s beverages I’m concerned about the excessive plastic on your bottles. Attached is a proposal to reduce the amount of plastic used on your beverages’ bottles. The consequences of using excessive plastic are deadly. If this proposal is carried out everyone will benefit immensely, including you.
Yes, the Chinese goods have invaded almost all the sectors of Indian market and seem to be bringing tougher times for the Indian Industry. Because of wide availability of cheap and apparently technologically advanced Chinese goods, many economists fear decline of local manufacturing units or the small-scale industry in India. The rise in demand and sudden popularity of Chinese products, which are available at cheaper prices, is giving nightmares to the Indian industry to the extent that they have started sticking “Made in China” stickers on their products to boost their sales. Chinese manufacturing units produce goods on a large scale. They are using the big Indian market merely to dump their products and by doing so they are killing the Indian units.
COCA COLA BUSINESS STRATEGY The strategy of The Coca-Cola Company has for a long time been best characterised as follows: global marketing and local manufacturing. However, the global marketing approach has been changed to local marketing because of the differences in consumer demands and experiences. To implement their “think local, act local” philosophy, the following key areas are considered: • Consumers – by using innovative and tailored marketing programs based on local consumer insights, The Coca-Cola Company will keep growing its core brands while also leveraging its distribution system to capture other growth opportunities in the ready-to-drink nonalcoholic beverage category. • Communities – local offices around the world ensure that the Company is a respectful corporate citizen and participates as an integral part of each community. • Customers – the Company provides value to customers through every consumer purchase, through superior customer service and through great value creation programs.
Global Human Resource Management at Coca-Cola The Coca-Cola is firm is one of the most successful multinational company in the world. Although it is an American company 80 precent of its profits comes from outside the United States. The story behind that it is the success in home country .the success in United States has inspired the executive in the enterprise to expand their business outside the firm’s home. When the company implemented its plan to set business in foreign countries, the company had been forcing difficulties that the executive had taken into consideration .the executives then realised that there is no trouble with the product but the trouble is with how to manage the company in a country which has a different culture. In this essay, we will answer some questions that are talking about the policy and strategy that Coca Cola applied in foreign country.
But there is a weakness that the organization normally focusing on retailing their product with coffee. The external factors or forces that affect the Old Town White Coffee are demographic forces, economic forces, natural forces, technological forces, political forces, and cultural forces. These forces are not controllable by the organization. In demographic forces, we can know that , the company targeted all ages of people which are students and youth, workers and senior citizen. In the economic factors, the economic trend is easily affecting the company by capital availability and cost and demand.