Coca Cola Five Competitive Forces Essay

610 words - 3 pages

Introduction

Coca-Cola Company Amatil (Aust.) Pty Ltd has a long history, since 1904 it named British Tobacco Company (Australia) Limited registered as an Australian public company. But while in 1964 they changed the structure of the company, establishment of Soft Drinks and started to be purchase of a controlling interest in Coca-Cola Bottlers (Perth) Pty Ltd. In 1977 the company changed its name to Amatil Limited and in 1989 company changed its name again as Coca-Cola Amatil Limited (CCA) and the Coca-Cola Company becomes CCA's major shareholder. Major corporate reorganized, sold the Company's tobacco subsidiary and made the core activities on beverages and snack foods (Coca-Cola Amatil(CCA) n.d). The company is very successful on non-alcoholic beverage, but it is not the only one it also has competitors.
Competitive Forces
There are five competitive forces models that Coca-Cola Company should faces. The force of traditional ...view middle of the document...

The force of substitute products and services is high because Coca-Cola is sweetened carbonated beverages and today’s people become more health conscience many healthy drink like juice, energy drinks and bottled water can substitute it (Laudon 2007). Customers have more choices on drinking that is the risk of substitution for Coca-Cola Company (Brian 2009).
The force of customers is high because the customers are hard to retain and easy to switch (Laudon 2007). Nowadays, people pay more attention on health they drink healthier beverages to substitute Coca-Cola and the customers can easily switch between Coca-Cola and some other drinks. To retain customers is difficult because nobody like always drinking the same taste beverage (Brian 2009).
The force of suppliers is low because Coca-Cola Company can get materials from many sources (Laudon 2007). Although there are several artificial sweeteners that are sourced from only a few companies, Coca-Cola Company’s gross margins are 65% (high) and so stable implies that is a low risk of supplier bargaining power (Brian 2009).
Recommendations
Coca-Cola Company should pay more attention on substitute products and services, to face this problem the company should research new beverages which are taste and healthier, and do some activities and advertise well. So people have more choices and might be interesting in trying drink new products that is able to attract and retain customers and reduce the risk of lose profit.

(490 words)

References:
Coca-Cola Amatil(CCA) n.d., The coca-cola amatil, Sydney, NSW, viewed 26 March 2010, < http://www.ccamatil.com/Australia.asp>.

Gaudet, B 2009, ‘Coca-cola: solid company at a reasonable price’, G4 Publishing, LLC, viewed 26 March 2010, < http://seekingalpha.com/article/147851-coca-cola-solid-company-at-a-reasonable-price>.

Laudon, KC and Laudon JP 2007, Management Information Systems: Managing the Digital Firm, 10th Edition, Pearson Prentice Hall, New Jersey

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