Week 8 Assignment: The Coca-Cola Company Case Analysis

The Coca-Cola Company case analysis
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COMPANY NAME, WEBSITE, AND INDUSTRY
The paper centers on the Coca-Cola Company, the company operates in beverage industry. The Coca-Cola Company website is -colacompany.com.
BACKGROUND AND HISTORY
The Coca-Cola Company is an American beverage corporation, established in the year 1886 by Asa Griggs Candler. The company based in Atlanta, Georgia adopted franchised distribution method, where the company produced syrup concentrate and sold it to several bottlers’ companies throughout the world. Besides the company’s flagship brand Coca-Cola, the company produces more than 450 beverage brands, such as Sprite, Coke, and Fanta. James Quincey, the Coca-Cola president and Chief Operating Officer (COO) is in charge for all of the corporation operating units globally. Muhtar Kent, appointed in April 2009, is the current Chief Executive Officer of the Coca-Cola Company. The company reported total sales of 17482 million US dollars and profit of 7351 million US dollars in the year 2015. Some of the Coca-Cola key events began in 1886 when John Pemberton, a chemist, created a unique tasting soft drink by blending heated sugar liquid with carbonated water. Frank Robinson, who worked as John bookkeeper christened the drink Coca-Cola and wrote its production procedure that is utilized by the company until today. In 1994, Robert Woodruff became the head of the Coca-Cola after his father; Ernest purchased the corporation in 1923 from Candler. In 1960 to 1961, the company commenced to expand its product’s line by acquiring Minute Maid Company, which produced juices and sprite. In 2005, the company launched coke zero, a calorie free drink, due to increase of consumer’s health conscious. Finally, in 2013, the company introduced a smaller 250ml can in the UK market to cater more health conscious consumers (Coca-cola, 2016).
The Coca-Cola Company gross profit margin improved from year 2013 to 2014, however, deteriorated significantly from 2014 to 2015. The Coca-Cola Company operating profit margin declined from the year 2013 to 2014 and reduced from 2014 to 2015.The company net return margin declined from the year 2013 to 2014, although, faintly recovered from 2014 to 2015. The company Return on Equity (ROE) diminished from 2013 to 2014, but improved from 2014 to 2015 greater than 2013 level. In addition, the company return on Assets (ROA) declined from the year 2013 to 2014, however faintly recovered from the year 2014 to 2015 (Coca-cola, 2016).
ANALYSIS VIA PORTER’S FIVE FORCES MODEL
Threats of new entrant
There beverage industry has many entry barriers, making the threats of new entry low. The Coca-Cola Company spends millions of dollars in advertising its brands, which makes it difficult for new rival to capture the market. The Coca-Cola Company has created higher product loyalty that makes it not viable for new rivals to match the company level in the beverage industry. In addition, the saturation of sparkling drinks, international market makes it difficult for new entrants to gain from the economies of scale utilized by the Coca-Cola Company (Dess...