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current opportunities and threats at Coca Cola

Step One. Please read the following article about Coke and conduct additional research, including their website, as needed. Remember, think through your answer first, then go and find what you need to help support your answer.

Foust, D. (2006). Queen of Pop. Business Week. New York: Aug 7, 2006., Iss. 3996; pg. 44 http://proquest.umi.com/pqdweb?index=1&did=1088393691&SrchMode=1&sid=9&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1236357834&clientId=29440
Step Two. Apply Porter's Five Forces Model. Remember that Porter's model is an INDUSTRY analysis, so your focus should be on analyzng the external environment of the soft drink industry - not just Coke as a separate entity.

Step Three. Write a three page paper, answering the case question and upload it to coursenet by the end of this module.

Solution Preview

Dear Student,

I have read the Business Week Article and shall help you with the content outline for your response to the essay question below.
"What are the current opportunities for Coca Cola, what threats are they facing, and what actions are they taking to respond to these environmental contingencies?"

PORTER'S FIVE FORCES MODEL

Threat of New Entrants
Barriers to new entrants are great. They include a large capital investment required to enter the soft drink market as a viable competitor to Coke and Pepsi and breaking of exclusive distribution agreements with outlets such as restaurants, ball parks and convention centers.

Threat of Substitute Products
This is the greatest threat, as substitute products such as natural drinks, juice, ice tea and other beverages considered healthy alternatives are part of the national trend toward consuming health enhancing foods and drinks.

Bargaining Power of Customers
Vending machines are dominated by Pepsi and Coke so there is little bargaining power, but in fast food chains there is more consumer bargaining power. The power to stop drinking soda is the greatest power consumers have and societal shifts to a healthier lifestyle and the willingness of consumers to pay more for healthier ...

Solution Summary

Threat of New Entrants
Barriers to new entrants are great. They include a large capital investment required to enter the soft drink market as a viable competitor to Coke and Pepsi and breaking of exclusive distribution agreements with outlets such as restaurants, ball parks and convention centers.

Threat of Substitute Products
This is the greatest threat, as substitute products such as natural drinks, juice, ice tea and other beverages considered healthy alternatives are part of the national trend toward consuming health enhancing foods and drinks.

Bargaining Power of Customers
Vending machines are dominated by Pepsi and Coke so there is little bargaining power, but in fast food chains there is more consumer....

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