SWPT ANALYSIS 2 SWOT Analysis Name of Student] ✓ Solved

SWOT Analysis: The SWOT analysis reveals all the internal and external factors of the organization. The internal factors include the strengths and the weaknesses of Coca Cola. The external factors include the opportunities and threats that Coca Cola faces. The company is affected deeply due to these factors (Salar & Salar, 2014).

Strengths

1. Dominant in the beverage industry: Coca Cola is one of the biggest beverage companies in the whole world. It has a large and dominant market share which has helped it to gain competitive advantage. It provides more than 1.9 billion people with cold drinks like Coke, Fanta, and Sprite each day. Coca Cola has 500 nonalcoholic brands that are sold to 200 countries all around the world.

2. Economies of Scale: Coca Cola enjoys the perks of economies of scale. Due to a large number of sales, the fixed cost of the brands under Coca Cola is very low, making all the drinks cost less. In this way, they can generate a large amount of revenue (Salar & Salar, 2014).

3. Power over the competitors and suppliers: Coca Cola has excellent market power over its competitors and suppliers. The suppliers ask for lower prices which helps them achieve economies of scale. Coca Cola can also acquire small markets to increase their market share.

4. Power over buyers: Coca Cola is widely recognized worldwide compared to smaller competitors, giving it immense power over buyers through good brand image and brand awareness. This impacts consumer purchasing intentions. Coca Cola has effective marketing strategies that keep customers informed.

5. High Audience Reach: The distribution network of Coca Cola is efficient, reaching a large number of people easily. Their delivery system is faster than competitors, serving more than 1.9 billion people in a day.

Weaknesses

1. Competition with Pepsi: Coca Cola faces aggressive competition with Pepsi, one of its biggest rivals. If Pepsi did not exist, Coke might dominate the market (Ramadhan & Sofiyah, 2013).

2. Product Diversification: Coca Cola has low product diversification, resulting in a limited portfolio. Pepsi’s extensive range of snack products can be advantageous for them.

3. Health Issues: Carbonated drinks are linked to health concerns like obesity and diabetes, affecting sales as consumers become more health-conscious (Ramadhan & Sofiyah, 2013).

4. Water Management: Coca Cola has faced criticism over water usage, raising concerns about water scarcity and resulting in lawsuits due to excessive consumption and contamination allegations (Cola & Schweppes, 2014).

5. Negative Publicity: Ongoing negative publicity surrounds Coca Cola, arising from health issues linked to its products and water management controversies.

Opportunities

1. New Products: Coca Cola can diversify its product line by developing new products in the health sector to improve market share and revenue generation (Renz & Vogel, 2016).

2. Expansion into Developing Countries: Focusing on developing countries can increase market share and revenues, especially in high-temperature regions, such as those in the Middle East.

3. Supply Chain Advancements: By improving supply chain management, Coca Cola can reduce transportation costs and achieve economies of scale, presenting a significant opportunity.

Threats

1. Water Consumption Controversy: Coca Cola’s water management issues threaten its reputation, faced with potential lawsuits from sustainability groups (ABBASI, 2017).

2. Packaging Issues: The company faces criticism for extensive use of plastic bottles, drawing negative attention from NGOs and environmental activists.

3. Competition: Direct and indirect competition from Pepsi and other brands can negatively influence Coca Cola's market position.

4. Strong Dollar Value: Coca Cola's income relies on international markets, so fluctuations in currency values, particularly a strong dollar, can adversely impact revenues (Baah & Bohaker, 2015).

References

  • ABBASI, H. (2017). Marketing Strategies Of Coke: An Overview. Kaav International Journal of Economics, Commerce & Business Management.

  • Baah, S., & Bohaker, L. (2015). The Coca-Cola Company. Culture, 16, 17.

  • Cola, C., & Schweppes, C. (2014). The Coca Cola Company. Human Rights Policy.

  • Ramadhan, A., & Sofiyah, F. R. (2013). Analisis SWOT Sebagai Landasan Dalam Menentukan Strategi Pemasaran (Studi Kasus McDonald’S Ring Road). Jurnal media informasi manajemen, 1(4).

  • Renz, F., & Vogel, J. (2016). Analysis of The Coca-Cola Company.

  • Salar, M., & Salar, O. (2014). Determining pros and cons of franchising by using SWOT analysis. Procedia-Social and Behavioral Sciences, 122.