An Assignment

On

Economic Condition of Coca-Cola

Submitted to -

NAHID SHAH

Lecturer

Department of Marketing

Comilla University

Submitted by -

AMRITA CHANDA

ID – 15010737

EMBA 8TH Batch

Session – Spring 2015

Department of Marketing

Comilla University

Date of Submission – 29 August, 2015

Acknowledgement

First of all, I would like to express my deep gratitude to Almighty for preparing this

Internship Report.

This assignment has been prepared as the part of MBA (Evening) Program under

Department of Marketing of Comilla University. I would also like to thank Nahid Shah,

Lecturer of Marketing Department, Comilla University for giving me his precious time

and sincere guidance by pointing out the flows of my assignment and by providing me

the right direction.

I would also like to thank to all the officers and employees of Abdul Monem Limited,

Comilla for giving me the guidance throughout the internship period and giving me the

knowledge.

Last but not the least thanks goes to my parents for bearing the tension, frustration and all

the hard work along with me through the entire MBA(Evening) program.

...............................

Amrita Chanda

Exam Roll: 15010737

MBA (Evening) Program (8th Batch)

Session: Spring 2015

Department of Marketing

Comilla University, Comilla.

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Table of Content

Number Description Page number

1 Introduction 4

2 Literature Review 6

3 Objective 13

4 Problem and Recommendation 15

5 Conclusion 16

6 Reference 18

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Introduction

The Coca-Cola Company is the world’s largest nonalcoholic ready-to-drink beverage

company with the world’s most recognized brand. Its products are available in more than

200 countries, and nearly 1.7 billion servings of its products are consumed each day. The

Coca-Cola system is defined as the Company and its more than 300 bottling partners

worldwide. Three years ago, The Coca-Cola Company launched Live Positively™/Live

for a Difference, a system-wide sustainability framework that is embedded in every

aspect of the Coca-Cola business. Through Live Positively the Company strives to create

a positive difference in the world. Live Positively™ focuses on seven core areas key to

business sustainability, with measurable goals and metrics for the Company and the

Coca-Cola system. They are:

Beverage Benefits: Strive to offer beverages for every lifestyle and occasion while

providing quality that consumers trust.

Active Healthy Living: Support active healthy lives through product variety, nutrition

education and physical activity programs.

Community: Foster sustainable communities through economic development,

philanthropy and the creation of economic and social opportunities.

Energy Efficiency and Climate Protection: Aim to be the beverage industry leader in

energy efficiency and climate protection.

Sustainable Packaging: Aspire to make our packaging a valuable resource for future use.

Water Stewardship: Work to safely return to nature and communities an amount of water

equivalent to what we use in our beverages and their production.

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Workplace: Create diverse, healthy and safe work environments aligned with

internationally respected human rights principles. Progress on these commitments can be

found in the Company’s Annual Sustainability Review.

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Literature review

In this report it can be found that Coca-Cola adopted some advantages to do its business

in the market. Not only this for this advantages this brand become one of the most top

brands in world street business brands. Now here are some methods -

1. Ansoff’s Matrix

Ansoff’s product/market growth matrix suggests that a business’ attempts to grow depend

on whether it markets new or existing products in new or existing markets. The output

from the Ansoff matrix is a series of suggested growth strategies which set the direction

for the business strategy.

For each of the directions suggested by the above models, there are different methods of

development.

According to Johnson & Scholes, a development method is the means by which a

strategic direction is pursued.

For example, when pursuing a growth strategy, a business is often faced with making a

choice between three development methods

Internal development (often called “organic growth” in business textbooks)

Acquisitions (occasionally, and often incorrectly called “mergers”)

Joint ventures and alliances

Internal development is where strategies are developed that build on the business’ own

capabilities and resources.

For most businesses, this is the only development method used.  Internal development

involves approaches such as:

Designing and developing new product ranges

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Implementing marketing plans to launch existing products directly into new

markets (e.g. exporting)

Opening new business locations – either in the domestic market or overseas

Investing in research and development to support new product development

Investing in additional production capacity or new technology to allow increased

output and sales volumes

Training employees to help the best acquire new skills and address new

technology

Whilst these approaches are not easy, they are generally considered to be lower risk than

the alternative – acquisitions or joint ventures.  However, the major downside of focusing

on internal development is that the speed of change or growth in the business may be too

slow.

2. Boston Group Consulting Matrix:

This categorizes the products into one of four different areas, based on:

Market share – does the product being sold have a low or high market share?

Market growth – are the numbers of potential customers in the market growing or

not

How the Boston Matrix is Constructed

The Boston Matrix makes a series of key assumptions:

Market share can be gained by investment in marketing

Market share gains will always generate cash surpluses

Cash surpluses will be generated when the product is in the maturity stage of the

life cycle

The best opportunity to build a dominant market position is during the growth

phase

How does the Boston Matrix work? The four categories can be described as follows:

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Stars are high growth products competing in markets where they are strong

compared with the competition. Often Stars need heavy investment to sustain

growth. Eventually growth will slow and, assuming they keep their market share,

Stars will become Cash Cows

Cash cows are low-growth products with a high market share. These are mature,

successful products with relatively little need for investment. They need to be

managed for continued profit - so that they continue to generate the strong cash

flows that the company needs for its Stars

Question marks are products with low market share operating in high growth

markets. This suggests that they have potential, but may need substantial

investment to grow market share at the expense of larger competitors.

Management has to think hard about “Question Marks" - which ones should, they

invest in? Which ones should they allow to fail or shrink?

Unsurprisingly, the term “dogs" refers to products that have a low market share

in unattractive, low-growth markets. Dogs may generate enough cash to break-

even, but they are rarely, if ever, worth investing in. Dogs are usually sold or

closed.

Ideally a business would prefer products in all categories (apart from Dogs!) to give it a

balanced portfolio of products.

3. McKinsey Growth Pyramid - Growth Strategy:

This model is similar in some respects to the well-established Ansoff Model. However, it

looks at growth strategy from a slightly different perspective.

The McKinsey model argues that businesses should develop their growth strategies based

on:

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• Operational skills • Privileged assets • Growth skills • Special relationships

Growth can be achieved by looking at business opportunities along several dimensions,

summarized in the diagram below -

:

• Operational skills are the “core competences” that a business has which can provide the

foundation for a growth strategy. For example, the business may have strong

competencies in customer service; distribution, technology.

• Privileged assets are those assets held by the business that are hard to replicate by

competitors. For example, in a direct marketing-based business these assets might include

a particularly large customer database, or a well-established brand.

• Growth skills are the skills that businesses need if they are to successfully “manage” a

growth strategy. These include the skills of new product development, or negotiating and

integrating acquisitions.

• Special relationships are those that can open up new options. For example, the business

may have specially string relationships with trade bodies in the industry that can make the

process of growing in export markets easier than for the competition.

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The model outlines seven ways of achieving growth, which are summarized below:

Existing products to existing customers

The lowest-risk option; try to increase sales to the existing customer base; this is about

increasing the frequency of purchase and maintaining customer loyalty

Existing products to new customers

Taking the existing customer base, the objective is to find entirely new products that

these customers might buy, or start to provide products that existing customers currently

buy from competitors

New products and services

A combination of Ansoff’s market development & diversification strategy – taking a risk

by developing and marketing new products. Some of these can be sold to existing

customers – who may trust the business (and its brands) to deliver; entirely new

customers may need more persuasion

New delivery approaches

This option focuses on the use of distribution channels as a possible source of growth.

Are there ways in which existing products and services can be sold via new or emerging

channels which might boost sales?

New geographies

With this method, businesses are encouraged to consider new geographic areas into

which to sell their products. Geographical expansion is one of the most powerful options

for growth – but also one of the most difficult.

New industry structure

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This option considers the possibility of acquiring troubled competitors or consolidating

the industry through a general acquisition program.

New competitive arenas

This option requires a business to think about opportunities to integrate vertically or

consider whether the skills of the business could be used in other industries.

4. Game theory:

Game theory is the study of strategic decision making. Specifically, it is "the study of

mathematical models of conflict and cooperation between intelligent rational decision-

makers. An alternative term suggested "as a more descriptive name for the discipline" is

interactive decision theory. Game theory is mainly used in economics, political science,

and psychology, as well as logic, computer science, and biology. The subject first

addressed zero-sum games, such that one person's gains exactly equal net losses of the

other participant or participants. Today, however, game theory applies to a wide range of

behavioral relations, and has developed into an umbrella term for the logical side of

decision science, including both humans and non-humans (e.g. computers, animals).

Modern game theory began with the idea regarding the existence of mixed-strategy

equilibria in two-person zero-sum games and its proof by John von Neumann. Von

Neumann's original proof used Brouwer fixed-point theorem on continuous mappings

into compact convex sets, which became a standard method in game theory and

mathematical economics. His paper was followed by the 1944 book “Theory of Games

and Economic Behavior”, co-written with Oskar Morgenstern, which considered

cooperative games of several players. The second edition of this book provided an

axiomatic theory of expected utility, which allowed mathematical statisticians and

economists to treat decision-making under uncertainty.

This theory was developed extensively in the 1950s by many scholars. Game theory was

later explicitly applied to biology in the 1970s, although similar developments go back at

least as far as the 1930s. Game theory has been widely recognized as an important tool in

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many fields. With the Nobel Memorial Prize in Economic Sciences going to game

theorist Jean Tirole in 2014, eleven game-theorists have now won the economics Nobel

Prize. John Maynard Smith was awarded the Crafoord Prize for his application of game

theory to biology.

5. Porter's 5 Forces Analysis:

1. Threat of New Entrants

How difficult (or easy) is for someone to enter your specific vertical? If it’s very easy

then most likely the space will be crowded with competitors fighting for margins.

Conversely, if it’s very difficult, that that in itself can become a competitive advantage.

2. Threat of Substitute Products (or Services)

How likely is it that another product or service could decrease demand or displace you

and potentially the entire industry all together?

3. Bargaining Power of Customers

When it comes to pricing and terms, how much power does your customer have? Are

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they organized enough to exercise their purchase power or is their so much competition

that they have their pick resulting in pricing wars amongst providers?

4. Bargaining Power of Suppliers

This refers to how dependant you are on a given supplier to operate your business. If it’s

difficult or near impossible for you to switch, that means they have the upper hand,

whereas, if the switching costs are low, you can negotiate better terms for yourself.

5. Competitive Rivalry of Market

Factoring in the first four forces, you can arrive at a good understanding of the playing

field and whether it’s in your favor to you enter it, how long you’ll be able to last,

through what means you’ll carve a space for yourself, and what you’re up against.

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Objective

To identify the total marketing strategy of Abdul Monem Limited.

To identify the practical implementation the P’s of the marketing.

To gather knowledge about food and beverage of Abdul Monem Limited.

To get an overview of food and beverages of Abdul Monem Limited.

To overview the construction and pharmaceuticals unit of Abdul Monem Limited.

To study the present condition of Abdul Monem Limited.

To study the present market senerio of Coca-Cola.

To state the present women position in our private organaization job.

To define the economic sattelement of Coca-Cola

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Problems and Recommendations

Problems -

The carbonated beverage industry of Bangladesh is visibly a matured and declining

industry.

• The existing market of carbonated beverage is seriously threatened by the emergence of

other substitute beverage products.

• Due to the narrow product line, AML and its beverage unit is having a hard time to

maintain its share in the market.

• Over the last decade, numerous numbers of new enterprises has entered the industry and

eventually have swamped the industry for its volume.

• The policy and technology determined by the Coca Cola Company, USA are not always

suitable for the case of Bangladesh.

Recommendations -

• To introduce other well anticipated products of Coca Cola Company in local market.

• Going for some alliance with some of the major rivals or if possible acquiring some of

them.

• As the oldest enterprise in the beverage industry of the country, the only cost AML can

consider is the variable cost of the product and can forget about the establishment cost as

it should have been recovered after all these days. Thus, AML can consider a serious

price cut to rule out the smaller player from the market and gain more share.

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Conclusion

Coca cola is still trying to gain grander in some region or continent around the world

even though they are tend to be leading non-alcoholic beverages producer and

manufacturer in the world, but they still a very strong competitor like Pepsi. Coca cola

gain a little percentage of market shares in Bangladesh. They need to improve more on

the quality of service they give back to these regions, encourage more low emission

usage of power. Also they should implement system that will give them more edge

competitive edge over their competitors. Lastly it will be a good idea for them to adopt a

differentiation strategy plan which will bring new ideas within the team towards the

profit growth of the company.

This report reflects our three organizations’ ambitious attempt to provide insights into the

impacts of The Coca- Cola on local communities. It was driven by our determination to

collaborate more strategically and to create greater transparency around business impacts

on poverty. We aimed to shine a light on issues that both business and development

audiences want to understand better and by doing so, to inspire more companies to

embark on a similar journey. We sought to put people at the center of this process and

forge a new partnership between the private sector and civil society to share expertise and

build a common agenda on these issues. Based on this work, Coca-Cola has the

opportunity to broaden the concept of corporate responsibility through dialogue and

practice and to engage in dialogue in Bangladesh based on the findings of this report. As

such, we prepared a series of specific recommendations for action which appear

throughout the report. Together these recommendations span the full breadth of the Coca-

Cola. These areas represent opportunities for more coordinated dialogue and commitment

among our organizations, and are also opportunities for governments, business and civil

society more broadly.

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Women’s economic empowerment

The research demonstrated that women continue to be excluded from many economic

opportunities and tend to dominate the large informal retail sectors in Bangladesh, where

they run small shops adjacent to or in their homes. As discussed in the report, many

women reported that they find it difficult to grow their businesses due to a lack of access

to credit, particularly in certain area in Bangladesh. In September 2010, The Coca-Cola

Company announced 5 by 20, an initiative to empower 5 million women entrepreneurs in

the Coca-Cola. The Company recognizes how valuable women are to the Coca-Cola

business and has committed to finding ways to help them grow their businesses. The

Company will provide opportunities for economic empowerment in an effort to help

women generate more income and begin to move their families out of poverty. In

addition, 5 by 20 will provide training and capacity building activities and financing

schemes so as to equip women for the workplace and allow them to grow and sustain

their businesses. In light of this report, The Coca-Cola Company will make a special

effort to direct 5 by 20 efforts to empower women.

What we have learned

The overall process leading to this report has been a source of learning for all our

organizations. We have no doubt that civil society, government and business can form

strategic partnerships that leverage the unique skills, resources and influence of each

sector and that these partnerships are vital to address today’s development challenges

effectively. We found that in order to realize the potential of our partnership, it was

important to invest time and energy in building trust among our organizations and

specifically across the project team which worked directly on the initiative. We also

required strong leadership and a clear organizational mandate to support our involvement

in the collaboration and to overcome the differences in our institutional cultures.

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Reference

http://en.wikipedia.org/wiki/Private_Sector

http://en.wikipedia.org/wiki/Public_Sector

http://en.wikipedia.org/wiki/Job_satisfaction

http://en.wikipedia.org/wiki/Motivation

http://en.wikipedia.org/wiki/Pasay

Poverty footprint report

http://www.netmba.com/mgmt/ob/motivation/herzberg/

http://www.coca-colacompany.com/our-company/mission-vision-values

http://www.slidefinder.net/b/benefits_strategic_thinking_strategic_approach/

32841847

http://www.coca-colacompany.com/stories/economic-opportunity

www.coca-colacompany.com › Stories

www.studymode.com/subjects/coca-cola-economic-conditions

moore.sc.edu/UserFiles/moore/Documents/sareport2.pdf

www.theguardian.com/business/cocacola

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