BUSINESS PLAN

TOPIC: BUSINESS PLAN OF COCA COLA

PRESENTED BY: SYED SHAHARYAR MUZAFFAR (1939)

PRESENTED TO SIR EKHLAQUE AHMED

COURCE FACILITATOR: STRATEGIC MANAGEMENT

DATE: 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 non-
alcoholic beverages. These include four of the world’s best selling brands, owned by The Coca-
Cola 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

Regions:
Coca Cola Company started its functions in Pakistan in 1950. In 1996 coca cola setup its 1 st
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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2. Market structure:

Energy juices Soft drink Sports Tea and Water

drink drink coffee
Red Nestle/Pulp Pepsi/Coke --- Nescafe Aquafina/
bull/Stin y maid Kinley/Nestle pure life
g

Retailers

Wholesaler

Distributor’s warehouse

Distributers

Warehouses

Manufacturer

Beverage Industry
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Market growth: Value

2007 2008 2009 2010
Coca cola 28857 31944 30990 31467

Growth: Value
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Coca 31228 31347 31287 31317 31302 31309 31305 31307 31306 31306
cola

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: Volume

2007 2008 2009 2010

Coca cola 22.7 23.7 23.2 23.45

Growth: Units

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Coca 23.3 23.3 23.3 23.3 23.3 23.3 23.3 23.3 23.3 23.3
cola

Technique used:

Forecasting technique is taken to forecast the future growth of coca cola.

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3. Product life cycle:

Products Introduction Growth Maturity Decline

Red bull
Sting
Nestle juice
Pulpy maid
Pepsi
Coke
Nescafe
Aquafina
Kinley
Nestle pure
life

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 working?

4. SWOT analysis:

Strength:

world’s leading brand

Large scale of operations
Robust revenue growth.

Weaknesses:

Negative publicity
Weak distribution
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Decline in cash from operating activities
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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. Confrontation 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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6. Are the companies cost and price is competitive?

Coca cola
Cane Regular Disposable 1 liter 1.5 liter 2.25 liter
No Product ml Pric ml Price ml Pric ml Pric ml Pric ml Price
e e e e

1 Pulpy - - - - 300 35 - - - - - -
orange
2 Coke 300 25 25 15 300 25 1 50 1.5 70 2.25 95
0 ltr ltr ltr
3 Fanta 300 25 25 15 300 25 1 50 1.5 70 2.25 95
0 ltr ltr ltr
4 Sprite 300 25 25 15 300 25 1 50 1.5 70 2.25 95
0 ltr ltr ltr
5 Kinley - - - - 250 15 1 35 - - - -
ltr

Pepsi
Cane Regular Disposable 1 liter 1.5 liter 2.25 liter
No Product ml Price ml Pric ml Price ml Price ml Price ml Price
e

1 Pepsi 30 25 250 15 300 25 1 50 1. 70 2.25 95

0 ltr 5 ltr
ltr
2 Mirinda 30 25 250 15 300 25 1 50 1. 70 2.25 95
0 ltr 5 ltr
ltr
3 Mountain 30 25 250 15 300 25 1 50 1. 70 2.25 95
dew 0 ltr 5 ltr
ltr
4 7 up 30 25 250 15 300 25 1 50 1. 70 2.25 95
0 ltr 5 ltr
ltr
5 Sting 25 60 - - - - - - - - - -
0
6 Aquafina - - - - 250 15 1 35 - - - -
ltr

Nestle
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Cane Regular Disposable 1 liter 1.5 liter 2.25 liter Sach
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No Produc m Pric m Pric ml Pric ml Pric m Pric m Pric ml price
t l e l e e e l e l e
1 Nestle - - - - 250 20 1 85 - - - -
juice lite
r
2 Nescafe - - - - 1 15
sache
3 Nestle - - - - 250 15 1 35 - - - -
pure ltr
life
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 Pakistan:

Year Per capita consumption

1989 3
1999 4
2009 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 “consumer view” activity exceeding
competitors.
Provide a single solutions for all the countries
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Built new capabilities to support customers
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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
marketplace and achieving sustainable, quality growth. For each goal, we have a set of
guiding principles and strategies for winning throughout 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 support sustainable
communities.

Profit:
Maximize long—term 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 9
production costs and capacity (because shortage of water is problem in some countries)
increasing pollution, poor management and climate change.
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The recent global credit crisis and its effects on credit and equity 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
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:
Managing 3rd 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 cola.

Operational benefits:

Lead time Down

Customers service Up
Inventory Down
Obsolescence Down
Freight costs 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:
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Our Roadmap starts with our mission, which is enduring. It declares our purpose as a company
and serves as the standard against which we weigh our actions and decisions.
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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
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

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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.
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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.

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 Quality High

Low
Economy Penetration

COCA COLA
Price

Skimming Premium
High

Pricing strategy matrix

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