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Wal Mart & Ryan Air Hbs Case Analysis

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COCA-COLA WARS CASE ASSIGNMENT 1. Compare the economics of the concentrate business to that of the bottling business: why is the profitability so different? (Use 5-forces analysis for both industries)
Concentrate business requires relatively less capital investments. This factor makes easier entering to the market. Less material usage and few input requirements also makes threat of substitutes and services more applicable however, Coke & Pepsi grants %72 of the market so that there is a high risk of market entrance in concentrate business. Also, high costs of marketing (advertisement & promotions) require a solid brand image and sustainable budget so that it’s hard to compete in such a market. Furthermore, customer loyalty and economies of scale makes this market profitable for huge players such as Cola and Pepsi.
Bottler business on the other hand requires high investment capital and too much operational cost which makes harder for new entrances to the market. Bottlers’ gross margin exceed %40 whereas their operational margin is %8 which is 1/3 of concentrate businesses. Bottlers are responsible for their own logistics and sales forces territorially and they are bounded on their pricing strategy through their contract with suppliers (Coke & Pepsi) so that their operational profitability remains low. More inputs and operational costs weaken bargaining power of suppliers however; because of high sales volumes and solid brand image with successful marketing campaigns keep Bottler business profitable. Coke and Pepsi also make huge investment to their Bottlers in order to reach maximum market share.

WAL-MART CASE ASSIGNMENT 1. What are the sources of competitive advantage for Wal-Mart?
There were two key aspects that made a huge growth and brought competitiveness to Wal-Mart. The first was locating stores in isolated…...

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