Cola Wars Continue Case Analysis Executive Summary: Wal-Mart is the leader of discount retail stores in the United States. Opening in 1962, the company created its empire by providing low-priced goods to consumers (prices average 10% - 15% lower than conventional department stores). In the 1980’s, the company diversified its store options to include warehouse and supercenter stores. After the death of leader, Sam Walton, Wal-Mart’s new management team faces many challenges. With a stagnant
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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 demands of CSD and
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Product and Brand Strategies Cola Wars Continue: Coke and Pepsi in 2010 1. Why, historically, has the soft drink industry been so profitable? Coca Cola was formulated in 1886 by a pharmacist in Atlanta who started to sell it in drug stores as a ‟portion for mental and physical disorders.“ Five years later the Asa Candler acquired the formula for Coca-Cola syrup which was a well-protected secret of the company. He also granted the first bottling franchise which grew qucikly. In the following
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business to that of the bottling business: Why is the profitability so different? 6.5 How can Coke and Pepsi sustain their profits in the wake of flattening demand and the growing popularity of non-CSDs? 7 9 11 Exam Case Study Cola Wars Continue: Coke and Pepsi in 2010 1 Overview (Power Point Page (PPP) 2) For more than a century, Coke and Pepsi compete for market share within the world’s beverage market. The most intense battles were fought over the $74 billion carbonated soft drink
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Executive Summary Prior versions of the case have been used to teach various subjects, including industry analysis, competitive dynamics, and vertical integration. While this case tries to incorporate some of the essential elements about the history of competitive dynamics and the historical patterns of vertical integration the primary teaching purpose of this case is to discuss the economics of the U.S. soft drink industry. Concentrate producers (CPs) sold syrup and concentrate to franchised of
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The competition within the $74 billion carbonated soft drink (CSD) industry has been remarkable ever since Coca-Cola was formulated in 1886, and further intensified when Pepsi was introduced in 1893. Ever since then, the CSD industry has been dominated by these two companies, with Coke taking the lead in the early stage, followed by Pepsi doubled its market share between 1950 and 1970 by offering its concentrate at a lower price than its competitor. The CSD industry has been profitable historically
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Case Analysis – Cola Wars Continue: Coke and Pepsi in 2010 Coke and Pepsi are two leading companies in the soft drink industry. They contend with each other during decades. The Cola Wars are a campaign of mutually-targeted television advertisements and marketing campaigns since the 1980s between soft drink manufacturers The Coca-Cola Company and PepsiCo. Historically, the soft drink industry has been so profitable. Porter’s Five- Forces Model of industry competition can define and analyze an
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Carbonated Soft Drink Industry Analysis A framework, known as the five forces model, was created by Michael E. Porter to assist managers with identifying opportunities and threats within an industry by analyzing the competitive forces. His five forces consist of: the risk of entry by potential competitors, the intensity of rivalry among established companies within an industry, the bargaining power of buyers, the bargaining power of suppliers, and the closeness of substitutes to an industry’s
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ahora es mayor sin embargo la estrategia de comunicación y de la cadena de suministro es muy amplia por lo cual les es más fácil colocar los productos y darle mayor empuje; logrando con esto competitividad en nuevos productos donde si los refrescos de cola tienen menor demanda los productos no gaseosos de cada empresa podrán llevar acabo la generación de
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HISTORICAL BACKGROUND Born in the Carolinas in 1898, Pepsi-Cola has a long and rich history. The drink is theinvention of Caleb Bradham (left), a pharmacist and drugstore owner in New Bern, NorthCarolina. In the late1890's, he had been experimenting withCoca andKola extracts in thesyrup form. By mixing this syrup with carbonated water, he produced a very pleasingbeverage that not only tasted good but also made his customers and friends feel good. Hepromoted it as a cure of dyspepsia (indigestion)
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