BUSINESS PLAN
TOPIC: TO PIC: BUSINESS PLAN OF COCA CO COLA
PRESENT PRESENTED BY: SYED SHAHARYAR MUZAFF MUZAFFAR AR (1939)
PRESENT PRESENTED TO SIR EKHLAQUE AHMED
COURCE FACILIT ACILITATO TOR: R: ST STRAT RATEGIC MANAGEMENT MANAGEMENT
DAT DATE: 19-APRIL-2010 19-APRIL-2010
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BUSINESS PLAN 1. The Business: Coca Cola Company has been serving to its customers for more than decade. Coca Cola is manufacturing refreshments, mineral water, juices and other products and providing the best products to their customers. Coca cola is providing more than soft drinks, brands include milk products, soup, and more so that customers can choose a coca cola company product anytime, anywhere for nutrition¶s and other needs. We produce, sell and distribute a wide range of nonalcoholic beverages. These include four of the world¶s best selling brands, owned by The CocaCola Company: Coca-Cola, Coca-Cola Light (diet Coke), Fanta and Sprite.
Coca Cola in the eyes of customers: We know what our customers want; customers are very satisfied with our products because we value their preferences and choices. Our customers are satisfied because they have our products at their door steps and they are loyal with us.
Core values: In order to satisfy customers our core values are Availability Affordability Acceptability Activation
R egions: st
Coca Cola Company started its functions in Pakistan in 1950. In 1996 coca cola setup its 1 production plant in Karachi. Now there are 6 production units and 11 distributions units working in Pakistan.
Target market: Coke¶s commercials basically based on young generations, so, the young generation is the target market of coke because we want to represent coke with the youth and energy but we also consider about the old people we take them as a co-target market.
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BUSINESS PLAN 2. Market structure: juices Energy drink Red Nestle/Pulpy bull/Sting maid
Soft drink Pepsi/Coke
Sports Tea and drink coffee --- Nescafe
Water Aquafina/ Kinley/Nestle pure life
Retailers
Wholesaler Distributor¶s warehouse
Distributers
Warehouses
Manufacturer
Beverage Industry
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BUSINESS PLAN Market growth: Coca cola
2007 28857
Value 2008 31944
2009 30990
2010 31467
Growth: Coca cola
Value
2011 31228
2012 31347
2013 31287
2014 31317
2015 31302
2016 31309
2017 31305
2018 2019 2020 31307 31306 31306
Analysis: As the market of carbonated beverage is saturated so the sales of the beverages is not increasing. It is on the sustainable stage.
Market growth:
Coca cola
Volume
2007 22.7
2008 23.7
2009 23.2
2010 23.45
Growth:
Coca cola
Units 2011 23.3
2012 23.3
2013 23.3
2014 23.3
2015 23.3
2016 23.3
2017 23.3
2018 23.3
2019 23.3
2020 23.3
Technique used:
Forecasting technique is taken to forecast the future growth of coca cola.
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BUSINESS PLAN 3. Product lif e cycle: Products
Introduction
Growth
Maturity
Decline
R ed bull Sting Nestle juice Pulpy maid Pepsi Coke Nescaf e Aquafina Kinley Nestle pure lif e
Analysis: On the basis of the survey conducted by the customers, retailers and wholesalers most of the brands are on maturity stage, according to survey I came to know that the coke share in Pakistan is in declining stage and they are on the decline face on product life cycle. According to the survey there are some more beverages that are taking some part of market share i.e. local brands Rooh Afza, Jaame Shirin, Sunsip Limo Pani, Shezan, Quice etc are also available locally.
How well is the companies current strategies work ing? 4. SWOT analysis: Strength:
world¶s leading brand Large scale of operations Robust revenue growth. Weak nesses:
Negative publicity Weak distribution Decline in cash from operating act ivities
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BUSINESS PLAN Opportunities: Acquisition intense competition Growing water bottled market Increasing in noncarbonated beverages
Threats:
Intense competition Declining growth due to weak distribution Dependence on bottling partners Decline in carbonated beverages Religion issues
5. Conf rontation matrix: Promising opportunities: Increase in Noncarbonated beverage would become the strength for coca cola because they have their brand name and capacity to produce and capture the upcoming segment Saturation in beverage segment allows coca cola to enter in new segment in Pakistan like energy drink or sports drink.
Only opportunities after improvement: Coca cola must improve its distribution in Pakistan to capture the market.
Ability to resist: Religious problem is threat for coca cola in Pakistan.
High risk :
Coca cola must focus on tea, coffee and energy drinks which are growing in Pakistan and coca cola¶s competitors are growing in this segment.
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BUSINESS PLAN 6. Are the companies cost and price is competitive? Coca cola Cane
R egular
Disposabl e
1 liter
No
Product
ml
Price
ml
Price
ml
Price
1
-
-
-
-
300
35
-
2
Pulpy orange Coke
300
25
250
15
300
25
3
Fanta
300
25
250
15
300
25
4
Sprite
300
25
250
15
300
25
5
Kinley
-
-
-
-
250
15
1 ltr 1 ltr 1 ltr 1 ltr
1.5 liter
ml Price
2.25 liter
ml
Price
ml
Price
-
-
-
-
-
50
1.5 ltr 1.5 ltr 1.5 ltr -
70
2.25 ltr 2.25 ltr 2.25 ltr -
95
50 50 35
70 70 -
95 95 -
Pepsi Cane ml Price
R egular ml Price
Disposabl e ml Price
1 liter ml Price
1.5 liter ml Price
2.25 liter ml Price
1 ltr 1 ltr 1 ltr 1 ltr 1 ltr
1.5 ltr 1.5 ltr 1.5 ltr 1.5 ltr -
2.25 ltr 2.25 ltr 2.25 ltr 2.25 ltr -
No
Product
1
Pepsi
300
25
250
15
300
25
2
Mirinda
300
25
250
15
300
25
3
300
25
250
15
300
25
4
Mountain dew 7 up
300
25
250
15
300
25
5 6
Sting Aquafina
250 -
60 -
-
-
250
15
50 50 50 50 35
70 70 70 70 -
95 95 95 95 -
Nestle Cane No 1 2 3
Product ml Price Nestle juice Nescaf e Nestle pure
-
-
R egular
Disposable
1 liter
ml Price -
ml Price 250 20
ml 1 liter
-
-
-
-
250
15
1 ltr
Price 85
35
1.5 liter
2.25 liter
Sache
ml Price -
ml Price -
ml
price
1 sache
15
-
-
-
-
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BUSINESS PLAN lif e
Analysis: All the products of coca cola are available at reasonable prices and within the customers range. Consumer is delight with the price offered by the coca cola. Competitors are also providing their products according to the market. And none of the company charges higher prices even the local brands are also selling their products at market price.
7. What do our customers wants? We are in the beverage industry and known for our wide range of products; which satisfies our customers. Our customers want better taste, no side effects, easily available, better and attractive packages, and new schemes in different seasons.
Per capita consumption of coca products in Pak istan: Year
Per capita consumption
1989 1999 2009
3 4 15
8. Objectives: The ultimate objective of our business strategy are to increase volume, expand our share of worldwide nonalcoholic ready to drink beverages sales, maximize our long-term cash flows, and create economic value added by improving economic profit. Promote new bottler by strategic partnership. Expansion of the sales and the profit by the ³consumer view´ activity exceeding competitors. Provide a single solutions for all the countries Built new capabilities to support customers
2020 vision: The world is changing all around us. To ensure our business will continue to thrive over the next 10 years and beyond, we are looking ahead to understand the trends and forces that will shape our industry in the future. Our 2020 vision creates a long-term destination for our business. it provides us with business goal that outline what we need to accomplish with our globaling bottling partners in order to continue winning in the
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BUSINESS PLAN marketplace and achieving sustainable, quality growth. For each goal, we have a set of guiding principles and strategies for winning thro ughout the entire coca-cola system. People: Foster open work environments as diverse as the markets we serve, where people deliver superior results. Portfolio: Bring to the world quality beverage brands that anticipate and satisfy people¶s desires and needs. Partners: Nurture a winning network of customer and suppliers with whom we create mutual, enduring value Planet:
Be a responsible citizen that makes a difference by helping build and suppo rt sustainable communities.
Profit: Maximize long²term return to shares owners while being mindful of our overall fiscal responsibilities Productivity: Be a highly effective, lean and fast moving organization that considers efficiency in everything we do.
Issues: Obesity and other health concerns may reduce demand for some of our products Water scarcity and poor quality could negatively impact the coca-cola system¶s production costs and capacity (because shortage of water is problem in some countries) increasing pollution, poor management and climate change. The recent global credit crisis and its effects on credit and e quity market conditions may adversity affect our financial performance Increased competition could hurt our business Fluctuations in foreign currency exchange rates could affect our financial results. We rely on our bottling partners for a significant portion of our business. If we are unable to maintain good relationships with our bottling partners, our business could suffer. If our bottling partners financial condition decreases our business and financial results could be affected
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BUSINESS PLAN Our business may suffer if we or our bottling partners experience strikes, work stoppages or labor unrest. Increase in the cost, disruption of supply or shortages of energy could affect our profitability Significant additional labeling or warning requirements may inhibit sales of affected products If we are unable to protect our information system against data corruption, cyber-based attacks our operations could be disrupted.
Action plan:
rd
Managing 3 party manufactures Managing synchronization of multiple suppliers Promoting and increasing our bottlers strength Increasing and strengthen our distribution network Focus on religious issues of coca co la. Operational benefits: Lead time Customers service Inventory Obsolescence Freight costs
Down Up Down Down Down
Vision: Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth
Mission: Our Roadmap starts with our mission, which is endur ing. It declares our purpose as a company and serves as the standard aga inst which we weigh our actions and decisions. To refresh the world... To inspire moments of optimism and happiness... To create value and make a difference
9. Product portfolio: Coca cola product port folio contains different brands of coca cola company, which are currently in use in Pakistan and world wide. This company not only deals in the carbonated drinks but also
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BUSINESS PLAN other drinks. Today coke, fanta, mirinda, minut maid, kinley, sprite are the products which are in the product port folio in Pakistan. But coca cola needs to increase its product portfolio in Pakistan because the demand of carbonated water is completed and this segment is saturated there are many companies in Pakistan competing for this segment. Coca cola needs to focus on sports segment, energy drink and tea, coffee segment in Pakistan because health conscious and safety problems are decreasing the trends of carbonated beverages. Coca cola has variety of drinks in these segments world wide they must introduce those products in Pakistani market and also focus the local brands and cultural tastes of Pakistan. 10. Market portfolio:
Coca cola is an international brand and they have focused international markets. But they are weak in Pakistan so they need to focus on local markets, increase their production capacity, strengthen their bottlers or transfer their dependency over their bottlers, improve their distribution network so that their product will be available at every shop and consumer can approach easily. Which channel to focus? As we are in the beverage industry and there is high demand of beverages in Pakistan and world wide; we are best around the world in all aspects from manufacturing to promotion to
advertisement to delivery and then sharing knowledge and R&D. But we are weak in Pakistani market our distribution is weak here. All the revenue we are getting is due to our brand name. Our most important distribution channel portfolio contains Distributers Wholesaler Retailer Every stage of our channel distribution is working well but we are not focusing our competitors yes we are no 1 beverage company around the globe but our competitors are quite good in this sector. We are not delivering our products to every shop in the country we should do competition segment matrix to find out that where we are lacking.
Advertisement
Pepsi and other competitors are hammering more on the minds of consumers than us through different commercials on TV, radio, internet, bill board etc.
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BUSINESS PLAN Pricing:
Our price is according to the market price we are not in the price war with our competitors. We charge price according to the seasons and follow the competitors strategy if our competitor increases the price we also follow and vice versa. Our product is not unique alternative is available in the market we are focusing price penetration strategies. we lie on the price penetration area in the pricing grid because we are providing high quality product and charging low price Low
Low
Quality
Economy
Hi h
Penetration COCA COLA
Price
Skimming
Premium
High
Pricing strategy matrix
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