Table of Contents

I. The Coca-Cola Company

a. History
b. Vision
c. Mission
d. Goals and Objectives
II. External Environment Assessment
a. Porter’s 5 Forces
b. Sectoral Analysis
III. Internal Assessment
IV. Strategy Formulation and Evaluation
a. Analytical Screen for Internal and External Assessment
b. SWOT Matrix
c. Strategy Evaluation Format: Evaluation of Strategy Alternative
V. Revised VMOs
a. Revisions
b. Suggestions
VI. Strategy Evaluation
a. Issues
b. Action Program Strategy
c. Recommendations

1
I. The Coca-Cola Company
a. History
Coca-cola is the largest beverage brand that manufactures, distributes, and
markets its brand to its end customers through different consuming establishments
all over the world. As of 2007, it has serviced 1.4 billion servings daily. Coca-Cola
history began in 1886 when the curiosity of an Atlanta pharmacist, Dr. John S.
Pemberton, led him to create a distinctive tasting soft drink that could be sold at soda
fountains. He created a flavored syrup, took it to his neighborhood pharmacy, where
it was mixed with carbonated water and deemed “excellent” by those who sampled it.
Dr. Pemberton’s partner and bookkeeper, Frank M. Robinson, is credited with
naming the beverage “Coca‑Cola” as well as designing the trademarked, distinct
script, still used today. As of 2007, the Coca-cola company has 400 brands
worldwide and they provide wide range of brands including diet and light beverages,
waters, juice drinks, teas, coffees, and energy drinks.

b. Vision
Our vision serves as the framework for our Roadmap and guides every aspect of
our business by describing what we need to accomplish in order to continue achieving
sustainable, quality growth.
▪ 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.
▪ Partners: Nurture a winning network of customers and suppliers, together we
create mutual, enduring value.
▪ Planet: Be a responsible citizen that makes a difference by helping build and
support sustainable communities.
▪ Profit: Maximize long-term return to shareowners while being mindful of our overall
responsibilities.
▪ Productivity: Be a highly effective, lean and fast-moving organization.
c. Mission
Our Roadmap starts with our mission, which is enduring. It declares our purpose
as a company and serves as the standard against which we weigh our actions and
decisions.
▪ To refresh the world
▪ To inspire moments of optimism and happiness
▪ To create value and make a difference.
d. Goals and Objectives
The Coca-Cola company aims to be globally known, they do this by targeting different
areas across the globe with different products, gaining their brand name and popularity.
All the bottling partners work closely with their customers such as convenience stores,
grocery stores, movie theaters and street vendors to create and use localized
strategies developed in partnership with the Company. Their competition with other
beverage companies are also narrowed down as they own various brands that could
be possible competition (Sprite or Fanta). The company often reviews and evaluates

2
 their business plans and performance to improve their earnings and analyze their
competitive position in the market. They make decisions in realigning their business
models to match the objectives of the company by using strategies and tactics in the
analysis of their performance.

II. External Environmental Analysis

This analysis determines the drive behavior of firms competing in the same
industry as Coca-Cola and explore the emerging trends in the soft drink industry as
well as identify the key success factors, evaluate industry attractiveness and identify
opportunities and threats the company is facing in its current environment.

a. Porter’s 5 Forces
THREAT OF
NEW ENTRY:
Size, Price,
Brand image,
Distribution,
Global
presence

SUPPLIER
COMPETITIVE
POWER: RIVALRY: BUYER POWER:
Health issues,
Bottling
partners, Rise PepsiCo, Global
environmental
in cost of raw Cadbury impact
materials
Schweppes

THREAT OF
SUBSTITUTION:
Quality, Healthier
Ingredients,
Performance

Competitive Rivalry Threat Level: Medium to High

▪ Competitors: Water, Pepsi, Cadburry
▪ Large market share of Coca-cola makes it difficult for other competitors to take
over
▪ Quality Differences
▪ PepsiCo has its own coffee product, joint-venturing with Starbucks. It also owns
the number one water brand, Aquafina, leading sports brand, Gatorade, bottled
tea products co-marketed with Lipton, as well as health conscious snacks.
Cadbury Schweppes PLC, a 200-year-old company, also has a strong regional
beverage presence in the Americas and Australia. Brand icons include Mott’s,
Canada Dry, Halls, Trident, Dentyne, Bubblicious, Trebor Basset, Dr. Pepper,
7up and Snapple.

3
 Threat of New Entrants Threat Level: Low
▪ High brand value with sponsors in big events
▪ Coca-Cola and PepsiCo continue to dominate with their strong brand name and
superior distribution channels. It is therefore very difficult for new unknown
entrants to start competing against existing established firms. High fixed costs
for warehouses, trucks, labor and economies of scale are also imposed for new
entrants.
Threat of Substitute Threat Level: High
▪ Cost of Change
▪ Limited taste variety
▪ Substitue performance
▪ Substitutes for Coca-Cola products are bottled water, sports drinks, coffee, and
tea. There is an increase in trend towards a healthy conscious consumer hence
he/she may choose water or sports drinks over sugary sodas. Just like Coke,
coffee and tea provide caffeine as well. Low switching costs for the consumer
makes the threat of substitutes very strong.
Supplier Power Threat Level: Low
▪ 13 Bottling Partners
▪ 62 Bottling Plants
▪ 25,000 Employees
▪ Coca-Cola has 13 bottling partners, 62 bottling plants, and 25,000 employees.
Most of the raw materials needed to produce concentrate are basic commodities
like color, flavor, caffeine or additives, sugar, packaging. These materials are
commodities in nature. The producers of these products have no power over the
pricing hence the suppliers in this industry are weak.
Buyer Power Threat Level: Medium
▪ Large customer chain
▪ Minimal consuming of individuals
▪ Retailers have power but is still relatively low
▪ While the company has been able to establish a large customer chain, the threat
of consumers increase daily as people are getting more conscious about their
health. People are now reading medical researches about the Coke brand,
especially the ingredients which are used in its manufacturing. The customers
have come up with knowledge that some of the ingredients used in Coke are
hazardous for the person who consumes it. Problems with health also rise
especially in the US where obesity is a number one issue.

b. Sectoral Analysis

Five A’s:
• Accessibility – Having served more than 200 countries, Coca-Cola is easily able
to distribute their products through retailers such as schools, grocers, restaurants,
movie theaters, vending machines, etc.
• Availability – Coca-Cola company owns more than 400 brands including diet and
light beverages, waters, juice drinks, sports drinks, teas, and coffee.

4
• Adequacy – Being a known, long-standing company, each purchase of a Coca-
Cola product guarantees the consumer the same taste, thus also the satisfaction
every time.
• Acceptability – Having sponsored numerous events, charities, and organizations
the company has earned the respect of the public. Coca-Cola is being celebrated
and recognized everywhere where it has become a standard choice for soft drink.
• Affordability – Despite being a popular brand, the company managed to keep their
prices affordable. Retailers can also acquire a much smaller price for bulk bottle
purchases.
- Driving Forces
Favorable Policies Evaluation
• To refresh the world with • The company has been consistent
satisfaction guaranteed with the taste and ingredients of
• To expand more globally their product
• Coca-Cola is still the leading
brand for beverage.
Institutional Allies Evaluation
• Fast food chains Coca-Cola is able to supply its partners
• Sponsorships with sufficient products and services. The
• Client loyalty company is also able to advertise such in
sports events and commercials.
Positive Reinforcing Conditions Evaluation
• Conduct business responsibly and The company should continue to evolve
ethically their business for continued success as
recognizing that the health of the
business is directly linked to the health of
the communities they serve.

- Hindering Forces
Unfavorable Policies Evaluation
• Health conditions Ingredients of the drinks contain too much
sugar. Issues regarding health, for
example obesity in the US, have been

5

Institutional Antagonists
• PepsiCo
• Cadbury Schweppes
Negative Unsupportive Conditions
• Solid Waste and Wastewater
Treatment
• Sustainable Packaging
• Energy use ration
brought to public’s attention. Consumers
are now more health conscious about
their intake.
Evaluation
Rivals also offer a large range of brands
and products; some have healthier
ingredients
Evaluation
The company aims to alleviate their
waste production, lessen energy
consumption, and promote eco-friendly
packaging.

III. Internal Assessment

Coca-Cola ensures fundamental internal features such as the efficient production
process, the appropriate organizational skills as well as the effective communication
and distribution networks, in order to achieve its mission and objective, the consumers’
satisfaction.
a. 1st Level: Evaluating Performance of Outputs and Outcomes

Output Outcome Evaluation

Assorted kinds of beverages Offers over 400 brands of Profit sales are high since it
juice drinks, sports drinks, caters to almost every
tea, coffee, and diet and light consumer’s preference
beverages

Inventory management Aims to ensure that Allows the company to

systems distributors receive
appropriate quantities of
beverages and that stock
replenishment occurs
effectively
operate with lower inventory
levels and reducing the costs
of storage and warehousing

6
Worldwide expansion and Coca-Cola continues to be the The company is recognized
operation leading beverage brand in the and even celebrated across
world the globe

b. 2nd Level: Evaluating organizational competencies & capabilities

SPAT Evaluation

Strategies: Coca-Cola is the leading beverage company,

able to serve 200 countries worldwide.
Global distribution

Programs: Led to the promotion and ownership of more

brands.
Expanding through joint-ventures with other
companies

Activities: Rise in net sales were generated through

World Cip advertisements and other
Advertisement and marketing
partnerships.
Tasks: The company now has over 400 brands of
different kinds of drinks.
Offer promos, rewards, and more on-demand
products

c. 3rd Level: Evaluating utilization of resources

Resources Evaluation

Human Resource: CEO and employees
Natural Resources: Raw materials
Financial Resources
The company is inclusive and ethical in the
workplace
The materials are basic commodities;
however, they present numerous health issues
The company continues to thrive financially

d. 4th Level: Evaluating management processes

Management Processes Evaluation

7
 Planning and Budgeting • Coca-Cola should shift to healthier
ingredients. They may also offer
alcoholic beverages to improve their
sales.
Organizing and Staffing • There is a wide and diverse
employment of 71,000 people from
over 200 countries.
Evaluating and Monitoring • CCA adopted a Co-Managed
Inventory system, which
electronically monitors inventory
levels. Improvements to their
inventory management systems,
which mainly aimed to ensure that
distributors receive appropriate
quantities of beverages and that stock
replenishment, were also applied.
Leading and Directing • The company is transparent with
their deliberation and review of the
things that should be maintained or
improved.
Coordinating and Orchestrating • Collaborations with other companies
made it possible for Coca Cola to
branch out to over 200 countries.

e. 5th Level: Evaluating the four management functions

Four Management Functions Evaluation

• Positioning - Coca-Cola aims to

• Product maintain being the
• Package leading beverage
The Marketing Functions • Place company.

• Price - 400 different brands

• People of sports, juice, diet

• Promotions and light beverages

8
 - Coca Cola creates
packaging strategies
that pushes people to
purchase their
product more (i.e.
collectibles)
- Leading distributor
of 200 countries
- Able to impact the
society with their
brand and
advertising.
(commercials in the
World Cup and the
Super Bowl)

• Manpower - 71,000 employees

• Machines from over 200
The Operations Function • Materials countries
• Methods - Materials are basic

• Management commodities

• Recruitment - Diverse recruitment

• Retooling - Driving associate
• Routing engagement through

Human Resource Management • Retaining training and

• Reviewing involvement
Function
• Rewarding - Able to make sure

• Recycling there is a happy and

productive
environment
• Financing - The company’s
Finance Function • Investing financial standing
• Negotiating and bottling

9
 • Administering investments are
• Numbers intact
• Cash Management
• Evaluation
• Projects The company aims to be

Programs and Projects • Programs healthier with their

drinks and be able to
expand their brands

f. 6th Level: Evaluating teams and individuals

Internal Customer Satisfaction (service profit chain)

Interna Ecternal
Employee Employee Customer Customer Revenue
Service Service
Satisfaction Loyalty Satisfaction Loyalty Growth
Quality Value

External Customer Satisfaction (The 5-Step IMC Processes)

5. 1. Customer
Budgeting, Identificatio
Allocation, n from
Evaluation & Behavioral
Recycling Data

4. 2. Valuation
Estimating
of
Return-on-
Customers/P
Customer-
rospects
Investment

3. Creating
& Delivering
Messages &
Incentives

List of Teams Evaluation

10
 Largest private-sector employer; An increase
of 10% in the company’s unit case, led by the
Africa
growth of sparkling beverages, was recorded
in 2007

Affordability and availability problems

resulted in a decline in sales in India and the
East and South Asia and the Pacific Rim Philippines in 2006, however, the
establishment of Coca Cola Bottlers
Philippines was able to tackle the problem

Advertisement through the World Cup

resulted to an increase of 6% in volume
European Union
growth. Enhanced connections were also
made in partnership with iTunes

Coca-Cola Zero reached 1 billion in units.

Expansion of product lines in water, juice, and
Latin America
juice/sports drink also improved their
performance

Internet-based My Coke Rewards; Largest

North America
share of percentage of sodas in Mexico

Top seller of non-alcoholic beverages yet

North Asia, Eurasia, and Middle East
Japan sales were lower than expected

Bottling investments, front-end capability,

equipment, and people/training, outsourcing,
crowdsourcing, reduction of ownership and
Bottling Investment
expansion of their outsourcing services
resulted to a strong unit case volume and
financial performance in 2007

g. 7th Level: Evaluating physical assets and set-up, working conditions and
environmental surroundings

Physical Set Up Evaluation

11
 • Factory - The rise in cost of raw materials

• Service Facility (sweetener and aluminum) has

affected the company.
• Machinery
- There is an aim to reduce waste
• Equipment
production.
• Environment
• Utility

h. 8th Level: Evaluating organizational affiliations, alliances, and linkages

12
 List of Alliances Description Evaluation

Coca-Cola is able to
branch out and sell more
• Large distribution in fast of their brands through

Fast food chains food chains different connections.

• Partnership with
Sponsorships
companies and events
Client loyalty • Hiring of loyal celebrities
to promote the product
Through the abundance
of the internet and
television commercials,
they are able to promote
new additions in their
company.

i. 9th Level: Evaluating top management, board members and leadership

Team Leaders Evaluation

- Was able to turn the Coca-Cola company around

Neville Isdell
when it received negative remarks from the public

- Able to cover bottling operation in 12 countries

- Served as President of the Company's East Central
Muhtar Kent Europe Division and Senior Vice President of
Coca-Cola International, with responsibility for 23
countries.

13
 - Became General Manager of Coca-Cola Turkey
and Central Asia

IV. Strategy Formula and Evaluation

Macroenvironment
Social

Technological Microenvironment
Economic
Company
Environmental
Suppliers
Political SWOT (Internal & External)
Customers
Legal
Intermediaries
Ethical

a. Analytical Screen for External and Internal Assessments

External Assessment (opportunities and threats) from macro to micro

Four Levels of Analytical Screen
Assessment

14
1. Macro •The company has had the ability to
Environment: grow with the world and all the
Social, Political,

S
changes that have been made over
Economic, the years
Ecological, •Many are switching to bottled water
Technological and diet colas instead of beer and
(PESTEL/SPEE other alcoholic beverages
T)

•government officials are alarmed by

P the public health associated with

obesity particularyl among young
people

•Deemed very successful in helping

other nations grow and become
economically stable by investing
millions of dollars back into the

E countries in which they are operating

•With both inflation and
unemployment rates decreeasing,
the current state of the economy
provides a positive state for Coca
Cola to articualte its strategy

•Company contracts with numerous

bottling companies around the world
to create and distribute their
beverages

E •the company has been very

successful in helping other nations
grow and become economically
stable by investing millions of dollars
back to the countries in which they
are operating

•advanced marketing strategies

T
through different new platforms and
technologies
•new bottling techniques to produce
higher volumes of coke products

2. Industry Sector Reduced disposable income and low consumer

Areas confidence have also led to significant changes in
shopping habits, which are affecting our customers.

15
 In addition, consumers are increasingly concerned
with health issues such as calorie-intake, nutritional
information and natural ingredients
3. Market Analysis The soft drink industry is lucrative with a potential for
high profits, but there are several obstacles to
overcome in order to capture the market share such
as accommodating changing social trends

4. Micro Market Continued focus on driving growth in sparkling

Analysis: beverages, immediate-consumption execution and
Location, alignment with bottling partners resulted in 9 percent
Immediate unit case volume growth in Latin America, the
Customers or highest in that operating group since 1997. Latin
constituency America was the second most profitable operating
group for the Company in 2007. Across the Coca-
Cola system, they are strengthening the execution in
the marketplace. Coca-cola shares best practices
globally and implement tailored plans to meet
localized market needs. A balanced portfolio,
geographic diversity and changing global
demographics position the company well to continue
growing the business. And in challenging markets
such as India, Japan and the Philippines, the
company has measurably stabilized the business
and returned to unit case volume growth. They also
continue to work toward returning our business in
North America to sustainable, consistent growth

Internal Assessment (strengths and weaknesses) from general to specific

Ten Levels of Analytical Screen
Assessment
1. Performance There is a wide negative campaign against using
Outcome, artificial sweeteners due to its negative health effects
outputs which raises food safety concerns
2. Organizational Coca-Cola’s organizational structure is set in a way
Capabilities that steers the company towards achieving its
strategy proficiently. Coca-Cola employs a divisional
organizational structure; this means that “its units or
divisions have its own functional specialists
who provide services and products or services
different from those of other divisions.”
3. Resource There is a limited resource of water in many parts of
Sourcing and the world and Coca-cola faces unprecedented
Allocation challenges from overexploitation, increasing
pollution, and poor management.
4. Management Compared to its competitor’s i.e. PepsiCo,Coca-Cola
Processes is known worldwide. In addition to differentiation,
Coca-Cola maintains a low costleadership. It
maintains low cost production and distribution by
owning most of its bottling companies, Euromonitor

16
 argues that “Coca-Cola’s production strength lay in
its widespread bottling capability which is at the
heart of the company’s success. The company
maintains such capability throughout the world
through (as the company itself reports) “a network of
company-owned or controlled bottling and
distribution operations as well as independently
owned bottling
partners, distributors, wholesalers and retailers”
5. Business Optimising the bottling and distribution infrastructure,
functions, while ensuring the systems meet the highest
programs, standards. At the same time, Coca-cola seek
projects strategic opportunities to take costs out of key
locations and processes.
6. Teams and Coca-Cola’s strategies are consistent with its
Individuals mission and have been implemented carefully and
meticulously in accordance with its leadership,
culture and structure. It employs a divisional
organizational structure; this allows each division to
communicate effectively and promotes diversity.
Operators are assigned according to their ability to
produce quality results.
7. Physical Assets, Price increases in, and shortages of, raw materials
Environmental and packaging materials could materially and
Conditions adversely affect our results of operations
8. Affiliations, Relationship with bottling partners is approximately
Alliances, 83% worldwide in which Coca-cola do not have
Linkages controlling interests. If Coca-cola is unable to provide
an appropriate mix of incentives to the bottling
partners through a combination of pricing and
marketing and advertising support, the bottlers may
take actions that, while maximizing their own short-
term profits, may be detrimental to Coca-cola or its
brands
9. Top Muhtar Kent, as the chairman and chief executive
Management, officer of Coca-Cola, redefined Coke’s culture and
Board, Leaders replaced about 70% of its senior managers, filling
the ranks with operator who is capable to generate
results. Kent’s leadership capabilities have
positioned the company in a way that will help them
achieve their long term objective and implement their
strategy
10. Strategic Fit Synergy, Complementary, Harmony

b. SWOT Matrix

Strengths Weaknesses
Large scale of operations Declining scales in low-
around the world income countries

17
 Vast global presence Negative publicity
Concerning health
beverages and labor
Strong Marketing Strategy Lack of diversity in products
Bargaining power over Depletion of raw materials
distributors and retailers and rising prices
Opportunity S-O Options W-O Options
Increase Supply chain improvement to Established a continuous
demand in keep transportation and improvement platform for
non- distribution costs low while managing workplace health
carbonated promoting interactive and safety for the company
category marketing strategy and bottling partners.
beverages Provide internal
and increase development opportunities
in bottled through training and
water market education resources and
develop innovative
technologies for product
development and product
processing

c. Strategy Evaluation Format – Evaluation of Strategy Alternative

Sample
Very Very
Criteria High Ave Low Multiplier Score
High Low
(Weight)
Rating 5 4 3 2 1
Relevance to VMO ◦ 2
Revenues ◦ 2
Returns ◦ 2
Responsiveness to 1
◦
Customers
Reinforcement of 1
◦
Existing Strategies
Resonance with 1
◦
Values
Reach ◦ 1
Range ◦ 1
Revolutionary 2
◦
Impact

18
 Relative Ease of 1
◦
Implementation
Resources 1
◦
Required
Risks ◦ 2

Total Score

V. Revised VMOs (Strategic Thrusts, KRAs, Objectives, PTs)

a. New Vision
i. Workplace: Foster an open and inclusive environment based on
recognized workplace human rights, where a highly motivated, productive
and committed workforce drives business success through superior
execution.
ii. Marketplace: Provide products and services that meet the beverage needs
of our consumers, while providing sound and rewarding business
opportunities and benefits for customers, suppliers, distributors and local
communities.
iii. Environment: Conduct our business in ways that protect and preserve the
environment and integrate principles of environmental stewardship and
sustainable development into our business decisions and processes.
iv. Community: Invest time, expertise and resources to provide economic
opportunity, improve the quality of life, and foster good will in communities
where we operate, through locally relevant initiatives.
b. Objectives
i. To achieve sustainable growth by community trust
ii. To maintain consumer relevance
iii. To create sustainable value and profitable growth across all key channels
iv. To practice effective cost leadership and aim to make a lean organization

c. Key Result Areas

Objectives
1. To achieve sustainable
growth by community trust
KRAs
1.1 Sustainable indices through annual ratings
used by analysts and investors
1.2. Indirect and direct carbon Footprint
measurement as defined by the Greenhouse Gas
Protocol
1.3 Sustainability of water use in bottling
operations essential in social licence
1.4 Safety operations measured through
accident rates

19
 2. To innovate products and 2.1 Constant product Innovation by the company
promote diversification
3. To create sustainable value
and profitable growth across all through official surveys
key channels
4. To practice effective cost
leadership and aim to make a
lean organization
is imperative and to recognize consumer wants
and needs
2.2 Per capita consumption: measures the
average number of 237ml or 8oz servings
consumed per person per year in a specific
market. Per capita consumption is calculated by
dividing unit case volume by 24 and dividing by
the population
2.3 Product and packaging quality are monitored
in cooperation with The Coca-Cola Company.
The quality index measures Brix (0 Bx), taste,
carbonation, micro appearance, date code,
container condition, closure function, closure
condition and net content, with a maximum score
of 100.
2.4 All complaints are recorded monthly by
category (both product and package issues) and
reported in terms of number of complaints per
million physical containers sold
3.3 Measuring customer satisfaction annually
3.4 DIFOTAI (Delivery In Full On Time Accurately
Invoiced): Customer logistics performance metric
calculation
3.5. Channel Profitability measures the EBIT
margin generated for Coca-cola from business
with customers, as well as the gross margin
generated for the customer from doing business
with Coca-Cola
4.1 Operating expenses as a percentage of NSR
4.2 Working Capital: current assets (excluding
cash and cash equivalents and current tax
assets), less current liabilities (excluding short-
term borrowings, current tax liabilities) plus
deposit liabilities on returnable containers
4.3 Water use ratio is calculated as litres of water
used in operations per litre of produced
beverages (l/lpb).
4.4 Energy use ratio is calculated as megajoules
per litre of produced beverages (MJ/lpb)

VI. Strategy Evaluations

a. Questions:
i. What technology should be used by the enterprise?
Technology is a key driver in every value-added activity within Coca-Cola.
The rapidly change in technology such as automation, supply chain
management and packaging technology has tremendous importance in the
way Coca-Cola does business worldwide. Technology in Coca-Cola

20
 transcends the conventional wisdom that is primarily focused on research
and development. Coca-Cola has strategic innovation group where R&D
staff is devoted to exploring new products and processes.
ii. What organizational modality should be adopted for implementing the
strategy?
Technology at Coca-cola can be categorized as product development and
process development.
b. Action Program Strategy
Economy Environment Product Marketing Corporate
Governance
Perform Evaluate Substantial Increase Stakeholder
market sustainability modification of presence in Engagement
research Indices existing the
focused on products or discounting
proposed developing channel
locations new products
for currently
served
markets and
customers
Creating a Develop Product Work closely Board
portfolio of cleaner Differentiation , with all Independence
related energy Product customers
businesses systems Innovation,
by and Product
acquisition Development
based on
creating
product-
market
synergies
Acquiring Managing Availability and Invest in Division of
firms that waste and accessibility new responsibilities
supply it with reducing canvass on technologies
inputs or are water use smaller regions in marketing
customers
for its
outputs
Forecast Recycle and Use various Create Appointment
transactional replenish risk promotional Process
exposures management tactics for
products such new markets
as commodity or local
swaps, futures, markets
option
contracts and
supplier
agreements.

21
 Prevention Develop a Manage Professional
of stock strong supply customer development
withdrawals chain and and support
commercial
leadership
Produce Internal audit
economic and control
impact
studies

c. Recommendations

Recommendations for declining volume in the carbonated soft drink sector

According to William Pecoriello, a leading beverage industry analyst from Morgan
Stanley & Co, the category of CSD has a decline in the current set of teens. In 2007,
the Beverade World proved that there is a forecast for a 1.5 percent annual volume
decline in their last survey where they surveyed 1550 consumers ranging from 13 to
65.
The soft drink sector is too large and lacking in positive health attributes to be able to
succeed in an increasingly health conscious market place. If Coca-cola focused only
on the carbonated soft drink sector competitively, it would be unable to continue to be
a market leader in the beverage industry.

The key recommendation for Coca-cola is to compete aggressively in the new age
beverage sector to make its mark in the booming global and domestic market for
energy drink, bottled water and other non carbonated drinks. Competing outside the
carbonated soft drink industry will make Coca-Cola competitive in the growth sector of
the industry. Coca-Cola must change with the times to adapt to the needs of new
generations of young consumers and health conscious consumers

There is also a major trend of health and wellness awareness sweeping across global
beverage market, especially in Europe and North America. PepsiCo is moving forward
with commitment to provide industry leadership in the health and wellness are. For
example, one of the key initiatives is PepsiCo’s smart spot product support as national
sponsor of the YMCA activate America on the move. PepsiCo launched the Smart
Spot symbol, the first of its kind designation that makes it easier for consumers to
identify PepsiCo’s products that can contribute to a healthy lifestyle.

The recommendation for Coca-cola is to move forward with commitment to provide

industry leadership in the health and wellness arena. Coca-cola should do a better job
of staying in touch with shopper and consumers and in the process of innovating and
creating value. I think the most important driver behind the demand for beverage is
population demographics. Two key segments of the marker, the baby boomers and
the young generation is more focused on preventing certain health conditions, and is

22
more likely than other generations to increase its consumption of healthy foods and
beverages, and avoid problematic ingredients such as sodium and sugar.

23