Strengths to grow by a further 3%

February 9, 2019 Finances

Strengths
Coca-Cola Company, with an object of attaining globalisation milestone, has several strengths that facilitate the achievement of the latter. Coca-Cola is the number one soft drink brand in terms of sales and reach. This is an advantage to the company as it demonstrates the product has a good reach and there is a potential for growth. According to Forbes (2017b), organic revenue for Coca-Cola is predicted to grow by a further 3% in 2017, and a strong operating performance is further expected to drive a 7% to 8% growth in comparable currency neutral income prior to taxes. Coca-Cola is ranked in the list of the top organisations in terms of multicultural opportunities, which is important in a globalised and internationalised world, as well as being named on the top corporations for women’s business enterprises list (Coca-Cola, 2016). The company is the largest marketer and manufacturer of non-alcoholic beverages in the world. The organisation has a massive operational reach, which includes over 200 countries worldwide, and spans across five operating regions; namely Europe, Middle East and Africa Asia Pacific; Latin America; North America and Bottling investments (Coca-Cola, 2016). Due to the large scale of operations company is able to achieve economies of scale and invest in new markets. Customer loyalty is another strength of the company. When our group was conducting interviews for the group project it was seen that people who like the brand tend to stick with the same. It is not rare to find the bottles and cans of the beverage in houses across the globe. Another strength of coca cola is its taste which according to people is better as compared to their rivals in the industry, PepsiCo.
The distribution network employed by Coca-Cola ensures that the product reaches even the remotest of locations across the globe. The demand within the market for the product has demanded that the distribution network be quite effective. The delivery of the products has to timely and frequent. Having a huge and effective distribution network, the product has commanded a high market presence (paperdue.com).
Weaknesses
Coca Cola is a very successful global company, with limited weaknesses. Like every multinational corporation with several products sold in many countries, Coca Cola does have some weaknesses. Word of mouth can be a weakness in some cases. Some of its products do not taste as good and are not as popular as the classic coca cola. Coca-Cola is currently in a time of structural change which has resulted in the uncertainty of the organisations stability and a fall in sales growth, due to the transition from being a capital-intensive organisation with refranchising plans aimed at China and North America, and structural changes in Africa and Europe (Forbes, 2017b). Competition from Pepsi has been a thorn in the flesh for a long time, and this has been affecting the products market reach. In some countries, Pepsi has managed to be the market leader which might create some problems if the trend continues. Across the globe, a number of popular supermarkets and fast food outlets which have traditionally been served by Coca-Cola are terminating contracts and severing their ties with the brand. This can be seen by the decision of Dominos Australia to ditch Coca-Cola in favour of their rivals Pepsi, and retailer Woolworths refusing to stock Coke’s newest zero sugar soft drink (Devlin and Davis, 2017).
Water management has been a great cause of concern for environmental organizations, they have indicated that the company is using large amounts of water. The environmentalist have accused the company of using large amounts of water in even water scarce areas. With such accusations and lawsuits, the product is affected, and the sales volume decline instantly (paperdue.com).
The products of the company are considered to be high in calories and can leads to certain diseases like diabetes if consumed in high quantities. Some groups in the society advocate healthier drinks over carbonated ones. In 2006, the company was involved in a controversy in India when government agencies alleged that the drink contains substances which are dangerous for health. Such publicity can cause the sales and revenue to go down.
Opportunities
As Coca Cola is a big company it has few opportunities that it can exploit. An opportunity lies in its ability to develop new products based on changes in consumer tastes and consumer preferences. The market for carbonated drinks is getting saturated in many Western countries and the trend is to move towards healthier drinks. The market is growing quite rapidly across the globe as well. Coca-Cola has developed and acquired various brands which are related to these segments. Coca-Cola can use its strong brand position to increase its presence in other beverage categories and take advantage of these growing markets. Coca-Cola has the opportunity to advertise its less popular products and they have the finances and brand position to do so. It will be very beneficial for the company if they start selling these smaller products same as the mainstream ones. Another opportunity is the population growth which has and will be facilitating the company to increase supply to the growing number of consumers.
With Coca-Cola already taking the first steps to make their products more sustainable, an opportunity for the organisation to consider in the future is a new business model focused on the circular economy, whereby resources are kept in a perpetual and benign cycle as opposed being sent to landfill or dumped after first use (Boyd, 2017).
Threats
In spite of the fact that Coca Cola dominates the beverage market, it still has to deal with many threats. The first and foremost of which is competition, especially from second leading competitor Pepsi. Coca-Cola needs to be careful that Pepsi does not become a more successful company. Another threat for Coca-Cola is the changing attitudes of the consumers to a more health conscious one. Nowadays consumers are constantly trying to change their eating and drinking habits. This will affect the sales of the company.

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