CIA-II
Topic: Comparative Study of Pepsi and Coca-cola
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The Battle of the Giants
Soft Drink Industry
The Soft Drink Industry consists of establishments primarily engaged in manufacturing non-alcoholic, carbonated beverages, mineral waters and concentrates and syrups for the manufacture of carbonated beverages. Establishments primarily engaged in manufacturing fruit juices and non-carbonated fruit drinks are classified in canned and Preserved Fruit and Vegetable Industry. Principal activities and products: • Aerated waters; • Carbonated beverages; • Mineral and spring waters; • Soft drink concentrates and syrup; and • Soft drink preparation carbonating.
What is Soft Drink?
Soft drinks are enormously popular beverages consisting primarily of carbonated water, sugar, and flavouring.
A nonalcoholic, flavored, carbonated beverage usually commercially prepared and sold in bottles or cans.
Applying Porter’s Five Forces to the soft drink industry 1. A fierce competition exists among very few players: - Duopoly industry - Intense rivalry between Coke and Pepsi
2. The threat of substitutes is reduced by the expansion of products portfolio: - Many alternative beverages e.g. juice, tea
3. Suppliers have less bargaining power: - Many substitutes for sugar and packaging e.g. sugar - corn syrup, sweeteners packaging - glass, plastic, metal cans 4. Different levels of bargaining power exist among the groups of buyers: - Vending Machine – no buyer bargaining power - Fast Food chain – more bargaining power
5. Strong barriers to new entrants: - Amount of capital investment require - Exclusive territories in distribution channel - The access to retail channel s
Industry S.W.O.T Analysis: o Strengths
▪ Basic Consumer Need ▪ Large and growing market ▪ Different flavors and packages ▪