PROJECT EAS 401

The Multinational company Coca

Cola.
History of the company
 The Coca Cola history began
after a pharmacist known as Dr.
John S Pemberton invented the coca
cola beverage.
 John Pemberton used a flavoured
syrup (coca cola) which he then took
to his pharmacy where it was mixed
with carbonated water.
 The Coca Cola Company was
incorporated by Asa Griggs Candler
in the year 1886 in Atlanta, Georgia.
 Asa Griggs Candler acquired the
Cola Company after purchasing
patents and the coca Cola formular
from Pemberton and his partners.
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 Three intrepreneurs namely John

Lupton, Joseph Whitehead and
Benjamin Thomas (purchased)
secured exclusive rights to bottle
and sell the beverage and developed
what became the Coca-Cola
worldwide bottling system.
 In 2013, the company was
recorded to have the strongest brand
image, financial position and the
largest customer base all over the
Globe, in the beverage industry.
 The company’s headquarters is in
Atlanta, Georgia in the United States
 Presently, it is run under the
chairman Muhtar Kent and the CEO
is James Quincey
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The company Logo

 Frank M. Robinson was the man
who named the beverage Coca-cola
and designed the trademark.
 The beverage was patented in the
year 1887 and registered as a trade
mark in the year 1893.
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Brands and Branding

 A brand is a name, term, design
or any feature used to distinct a
firm’s products from those of
competitors. Branding is creating an
image in the minds of consumers
about a product such that they can
quickly identify the firm’s product
or organization.
 The Coca cola company has the
strongest portfolio of brands in the
non-alcoholic beverage industry.
 These feature 21 brands that
generate more than $1 billion USD
in annual retail sales.
 It has been listed as the world’s
most valuable brand with 94 percent
of the world’s population
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recognizing the red and white Coca

Cola brand Logo.
 The firm has the following
brands:


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
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Product line
The multinational company is a soft
drink and beverage manufacturer
selling more than 3500 products
under 500 different brand names.
These include :
 Water - Aquarius, Glaceau
Smartwater and Bonaqua
 juices and juice drinks-
Minute Maid Pulpy
 ready to drink teas and
coffees- Fuze tea
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 energy and sports drinks-

Powerade
Strategy of the company
Targeted market: the whole world
The company is customer oriented
It uses the following strategies to reach
its organizational goals
1. Diversification
 The Coca Cola company does not
offer just one type of beverage or
one brand. Rather, it offers a variety
of beverages.
 The firm took its first step
towards diversifying its portfolio in
1960 when it purchased Minute
Maid.
2. Branding
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The Coca cola logo was used as a brand

on the marketing of the products.
3. Pricing
 The firm guarantees it offers the
best price interms of value for
money. The beverages are
affordable such that many
consumers are able to afford.
 This has helped the firm in
developing a high market share in
the soft drink industry
4. Distribution-
 The Bottling of the beverage was
first done in the United states.
 Canada, Cuba and Panama were
the first 3 countries outside United
States to bottle Coca Cola. They
used a unique contour bottle.
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 To date, the firm has created an

extensive and well organized
distribution network guaranteeing
the ubiquity1 of its products and
based on its mission statement.
 That is, the firm makes sure its

5. Advertising
 Initially, Candler distributed
Coca Cola Coupons, souvenir
calendars and clocks with the
company logo to advertise and
promote coca Cola
 It was also done on a macro scale
by using painted wall signs, bill
boards, musicians to raise awareness
of the product
6. Social Responsibility

1
The ability to be present everywhere at once
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 Coca Cola financed and sponsored

many major events, organizations
and projects around the world. These
include the FIFA World cup,
Apple’s iTunes and the America
Idol.
 In 2009, the firm launched the
Replenish Africa Initiative, a six
year project to provide clean water
and sanitation in Africa.
 The company is also responsible for
employing millions of people around
the world, be it directly or indirectly
7. Consistancy
 The firm has maintained
consistancy, from the logo to the
bottle design. That is, the logo and
the bottle design (contour bottle) is
the same everywhere in the world.
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 This led to the establishment of a

strong brand image.
 The firm also applies consistence
in the pricing of its products. For
instance, from the year 1886 to
1959, the price for coca cola was 5
cents.
8. Franchise model
 The Coca Cola company operates
as a franchise model.
 For instance, initially, the
bottling rights of the beverages were
sold to different local intreprenuers.
 To this date, the firm has
continued to sell bottling rights to
established bottling firms all over
the world.
The Company‘s market value
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 Market value added (MVA) is a

measure of the value a company has
created in excess of the resources
already committed to the business.
 It is the difference between a
firm’s fair value and its invested
capital.
Coca-Cola Co., MVA calculation

USD $ in millions

Dec 31, Dec 31, 2016 Dec 31, 2015 D

 Fair value of Debt 1
 PV of operating lease payments 2
 Market value of common equity
 Equity attributable to noncontrolling interests
 Less: Marketable securities
 Market (fair) value of Coca-Cola
2017
48,374  46,250  44,437 
510  645  679 
187,871  179,381  191,191 
1,905  158  210 
7,547  6,115  8,567 
231,112   220,319   227,950   2

 Less: Invested capital 3

72,598  79,169  77,538 
 MVA 158,515   141,150   150,412   1
  
Source: Based on data from Coca-Cola Co. Annual Reports

 According to Statistica 2018,

Coca Cola company was ranked
number 13 in the world’s largest
companies with a market value of
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$182.9 billion dollars as at 7 April

2017.(market cap2)

12 months ended Dec 31, 2017 Dec 31, Dec 31, Dec
2016 2015 20

 Net operating revenues 35,410  41,863  44,294  4

 Cost of goods sold (13,256) (16,465) (17,482) (1

 Gross profit 22,154    25,398    26,812    28

 Selling, general and administrative (12,496) (15,262) (16,427) (1

expenses
 Other operating charges (2,157) (1,510) (1,657)
 Operating income 7,501    8,626    8,728    9

 Interest income 677  642  613 

 Interest expense (841) (733) (856)
 Equity income, net 1,071  835  489 
 Other income (loss), net (1,666) (1,234) 631 
 Income from continuing 6,742    8,136    9,605    9
operations before income
taxes
 Income taxes from continuing (5,560) (1,586) (2,239)
operations
 Net income from continuing 1,182    6,550    7,366    7
operations
 Income from discontinued 101  – –
operations, net of income taxes
 Consolidated net income 1,283    6,550    7,366    7

2
Market capitalization is the total market value of a firm’s outstanding shares of stock
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 Net income attributable to (35) (23) (15)

noncontrolling interests
 Net income attributable to 1,248    6,527    7,351    7
shareowners of The Coca-Cola
Company
Coca Cola Consolidated Income Statement
USD $ in millions

  Source: Coca-Cola Co., Annual Reports

The net income for the firm declined

from 2014 to 2015, and from 2016 to
2017
Coca Cola Company employed a total
of 100300 employees as of 2017

References
https://www.worldofcoca-
cola.com/about-us/coca-cola-history/
http://www.coca-cola.com/global/
https://en.wikipedia.org/wiki/The_Coca
-Cola_Company
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http://www.coca-
colacompany.com/brands/the-coca-
cola-company
http://www.coca-
colacompany.com/stories/coca-cola-
sponsorships
https://businesscasestudies.co.uk/coca-
cola-great-britain/within-an-arms-
reach-of-desire/introduction.html
https://www.feedough.com/coca-cola-
marketing-study/
https://www.stock-analysis-
on.net/NYSE/Company/Coca-Cola-
Co/Performance-Measure/Market-
Value-Added
https://www.statista.com/statistics/2632
64/top-companies-in-the-world-by-
market-value/
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