A ‘failed’ Joint Venture between Danone and Wahaha French’s Danone and China’s Wahaha had been a very successful joint venture in China. Danone’s capital‚ expertise & technology know-how‚ combined with Wahaha’s huge local presence in the market had seen the company soared in the food & beverage industry. It was until then when Danone accused its partner‚ Zong‚ founder of Wahaha of illegally selling Wahaha brand products using a distributor not selected by the joint venture agreement. Danone also
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Question 1 The concentration producing industry has one buyer and through its value chain. Instead‚ costs for advertising‚ promotion‚ market research‚ and bottler relations were significant. On the other hand‚ bottling industry is the mid-way player in the soft drink industry. There are two suppliers and one buyer involved in its value chain (Exhibit 1). Whether two industries are profitable depends on soft drink consumption‚ which had increased for more than 20 years and plateaued in the 1990s
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I. EXECUTIVE SUMMARY Pepsi Cola produces Philippine Inc (PCPPI) grew its net income last year by 192 percent to 44 million on the back of double digit growth in volume and softer sugar prices. For the fourth quarter alone‚ net profit doubled to 147 million on gross sales of 6.2 billion. Volume grew by 21 percent for the quarter; bringing full-year volume growth to an average of is percent across brands and categories. Gross sales for the full year rose percent to P22.73 billion. “This is a significant
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Yin Dongfang (2014-27148) 1) Why‚ historically‚ has the soft drink industry been so profitable? According to Exhibit 3a‚ the operation profit margin of the two giants kept robust growing from ~10% in 1970s to ~20% in 2005. That probably resulted from two reasons: 1) net sales enjoyed robust growth; 2) COGS and other expenses cowered fast. Net sales enjoyed robust growth. According to Exhibit 1‚ consumption per capita increased by 3% per year lasting for 3 decades since 1970s‚ due to A. Increasing
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The Coca Cola and Pepsi War 1. Why is the soft drink industry so profitable? * The soft drink industry remains profitable because of the market share based on Porters Five Forces. * Coke has protected its recipe for over a hundred years as a trade secret‚ and has gone to great lengths to prevent others from learning its cola formula. The company even left a billion-person market (India) to avoid revealing this information. As a result of extended histories and successful advertising
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European imperialism in China‚ British forces attempted to establish the foreign trading of opium‚ a highly addictive substance extracted from the juice of the opium poppy (“Opium and Heroin”) . The Chinese were opposed to this enforcement due to its negative effects among the Chinese economy and civilians. As a result of this prolonged dispute between British and Chinese powers‚ British troops eventually attacked numerous Chinese villages‚ leading to the commencement of the Opium Wars in the mid-18th century
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1. Introduction of Coca-Cola in China. Coca-Cola Company is the biggest soft drink company in the world and famous for its classic coke. It has over 100 years of history and its business scope covers more than 200 countries. The extended experience and abundant resources have made the brand a great success. In 1927‚ the Coca-Cola Company began to invest in China and then left temporarily for Chinese political factors. In 1979‚ it returned after Chinas reform and opening to the outside world. By
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were usually on a long term contract with the big companies and could not easily sign a contract with a new direct competing enterer. Two major players Coca cola and Pepsi have about three quarters of the soft drinks market were fiercely competing with advertising‚ creating new products and expanding new territories‚ without going into price war. The major products for the soft drink industry were not hard to find – carbonated water‚ sugar‚ bottles‚ so the only one that gave power for the suppliers
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"In China‚ you are inevitably dependent on expatriate employees‚" explains Pepsi-Cola’s Anthony‚ whose 500-person workforce includes a number of expatriates. "There’s no established tradition of companies breeding middle managers‚ so there are very few experienced local people to recruit‚" he notes. Experts agree that local talent is needed for long-term success‚ but expatriates can help accelerate the learning curve of developing executives and managers. "It has been proven by case studies that
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9-711-462 REV: MAY 26‚ 2011 DAVID B YOFFIE RENEE KIM Cola Wars Contiinue: Coke C an nd Pepsi in 20110 oke and Pepsi vied for “t hroat share” o of the world’ss beverage m market. For more than a century‚ Co The most intense battles in the so-called colla wars weree fought over the $74 billio on carbonated soft drink (CSD) industry in the Un nited States.1 In a “carefu ully waged co ompetitive strruggle” that llasted from 1975 through the mid-199 90s‚ both Cok ke and Pepsi achieved average annual
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