The Soft Drink Industry assignment. Cola Wars. Porters 5 Forces Model

Porters 5 Forces Model
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Porters Five Forces is observed as one of the simplest yet most powerful tools used to understand the competitiveness of the business environment that the organization is based at. Understanding the environment helps in adjusting profitability and strategy. To evaluate how easy and effective the five porters is to use, this study is going to look at case study between Coke and Pepsi and analyze the same on the five porters model.
Coke and Pepsi have been industry's competitors for decades. Looking at the five porter’s forces; that is the competitive rivalry, supplier power, and buyer power, threat of substitution and threat of new entry. Coke Cola main competitor is the popular Pepsi organization that also offer similar carbonated drinks. Coke is offering carbonated drinks such as coke and Pepsi offering Pepsi. This force is high intensity as they have for a few instances lowered Coke sales. Supplier power another force can be based on bottlers in our case study; Pepsi could negotiate prices with the bottling company and based its price on the consumer price index while Coke had the power to determine concentrated prices thus a competitive advantage. Supplier power here then has a high-intensity force.
The threat of substitution is another force, which helps in learning the environment. Cola case study has shown this force in several instances. Coke offering carbonated drinks is an advantage that they created a name for their brands, but the emergence of Pepsi made it challenging. This is because they also came up with every product that coke had, for example, when coke launched Fanta in 1960, sprite in 1964, and the low-calorie cola in 1963, Pepsi the main rivalry countered this by manufacturing mountain dew and Diet Pepsi. This force has a high intensity as Coke has closer substitute's products making the competition high.
The threat of new entry, this is a force that looks at the impact of the new entrants to the market especially in the same sector. In our case study, the carbonated drinks sector has been a monopoly somehow for decades now. Coke may have won on this, as the only competitor that comes close is Pepsi, th...