PESTLE Analysis On: Coca Cola
PESTLE Analysis On: Coca Cola
PESTLE Analysis On: Coca Cola
Introduction As we all know, the Coca is todays one of the biggest corporation that offers different refreshment in form of a soft-drink. These carbonated drinks are consumed at the rate of more than one billion drinks per day. But aside from their historical success, the Coca Cola Company is still a typical business that is affected and at the same time affecting the different type of communities.
PESTLE Analysis
The Coca Cola Company and other organizations have their own weaknesses and strengths that can both affect the future performance of their respective business. Analyzing the future constraints is an advantage for the companies since they can identify the possible factors that tend to leave an impact on their business.
PESTLE analysis is a popular method that focuses in the external factors of the business and the environment where it operates. PESTLE stands for Political, Economic, Sociological, Technological, Legal, and Environmental. All of them examine the changes in the marketplace.
Political Analysis
Political analysis examines the current and potential influences from political pressures. The non-alcoholic beverages falls in the category under the FDA and the government plays a role within the operation of manufacturing these products. In terms of regulations, the
government has the power to set potential fines for the companies that did not meet their standard law requirement.
The changes in laws and regulations, such as accounting standards, taxation requirements and environmental laws and foreign jurisdictions might affect the book of the company as well as their entry in foreign country. Other than that, the changes in the nature of business as non-alcoholic beverages can gain competitive product and pricing pressures and the ability to improve or maintain the share in sales in global market as a result of action by competitors.
The political conditions of the country are also basis of the study, especially in internal markets and other governmental changes that affects their ability to penetrate the developing and emerging markets that involves the political and economic conditions. However, Coca Cola continuously monitoring the policies and regulations set by the government.
Economic Analysis
Economic analysis examines the local, national and world economy impact which is also includes the issue of recession and inflation rates. The non-alcoholic beverage industry has high sales in countries outside the U.S. According to the Standard and Poor's Industry surveys, "For major soft drink companies, there has been economic improvement in many major international markets, such as Japan, Brazil, and Germany." These markets will continue to play a major role in the success and stable growth for a majority of the non-alcoholic beverage industry. There is a low growth in the market for carbonated drinks, especially in Coca Colas main market, North America. The market growth recorded at only 1% in 2004 for North America.
Sociological Analysis
This analyzes the ways in which changes in society affect the organization such as changing in lifestyles and attitudes of the market. Consumers from the ages of 37 to 55 are also increasingly concerned with nutrition. There is a large population of the age range known as the baby boomers. Since many are reaching an older age in life they are becoming more concerned with increasing their longevity. This will continue to affect the non-alcoholic beverage industry by increasing the demand overall and in the healthier beverages. The demand for carbonated drinks decreases and this pulled down the revenues of Coca Cola.
Technological Analysis
Technology is the main focus of the analysis where the introduction and the emerging technological techniques are valued. This creates opportunities for new products and product improvements in terms of marketing and production. As the technology advances, new products are introduced into the market. The advancement in technology has led to the creation of cherry coke in 1985 but consumers still prefers the traditional taste of the original coke.
Legal Analysis
Legal aspect focuses on the effect of the national and world legislation. The Coca Cola Company receives all the rights applicable in the nature of their business and every inventions and product developments are always going into the patented process.
Environmental Analysis
Environmental analysis examines the local, national and world environmental issues. According to the data of the Coca Cola Company, all of the facilities are strictly monitored according to the environmental laws imposed by the government.
Last Words
With the intensive study of the PESTLE, the company will continue to emerge and develop if they manage to find solutions in different challenges that the entire organization might face.
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The Coca-Cola Company is the largest beverage corporation in the world. It is also the largest manufacturer, marketer and distributor of non-alcoholic syrups as well as beverage concentrates. The
corporation is well known for its product, Coca-Cola that was invented in 1886 by John Stith Pemberton, a pharmacist. In 1889 Asa Candler bought the brand and in 1892 the company was finally incorporated by Candler. The Coca-Cola Company makes available over 400 brands in more than 300 nations world wide and serves over 1.5 billion consumer servings everyday. The company has its headquarters at Atlanta, Georgia. It is listed in the NYSE and is also a part of the S&P 500 and DJIA. The Coca-Cola Company was founded as the J. S. Pemberton Medicine Company which was a partnership between Ed Holland and Dr. John Stith Pemberton. The company at that time sold three products: French Wine of Cola, Globe Flower Cough Syrup, and Indian Queen Hair Dye. It was in 1884 that the company became one of the stock companies and it acquired the name, Pemberton Chemical Company. The Coca-Cola Company operates on the basis of a distribution system with the franchisees. The system has been in use in the company since 1889. The company produces the syrup concentrates which is sold to Coca-Cola bottlers around the globe who have a franchise of the company. The bottlers then combine it with sweeteners and filtered water and the finished products
are sold in bottles and cans. The bottlers distribute, sell and merchandise these end products to vending machines, retail stores, food distributors and restaurants. The Coca-Cola Company offers more than 400 brands, besides the hugely popular Coca-Cola beverage. Some of the varieties of beverages that are offered by the company are: Diet Coke, Cherry Coke, Coca-Cola Zero, Diet Cherry Coke, Diet Vanilla Coke, Coke with Lime, Diet Coke with Lime, Vanilla Coke, Coca-Cola BlaK, Coca-Cola Orange, Diet Coke Plus and many more. Tab, introduced in the market in 1963 was one of the first diet beverages of the company. It comprised saccharin instead of sugar and was thus less in calories. The product is still in the market but has been overtaken, as far as sales are concerned, by the Diet Coke. In the 1990s the company, in response to the growing health awareness of the consumers, introduced a number of noncarbonated beverages such as Minute Maid, Nestea, Powerade, Fruitopia, Dasani and many more. In 2004 when low-carbohydrate diet programs were in vogue, the company launched C2, which was a low-carbohydrate substitute of Coke Classic. C2 comprises aspartame, high fructose corn, sucralose, and Acesulfame potassium and is thus ideal for dieters.
The vision, values and mission of the company directs the company and ensures that it works towards its goals. Over the years it has build a strong presence in most of the countries across the globe and is poised for greater growth.
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