Coca-Cola- A Redefining its purpose

C A-C OC OLA REDEFI NI NG I TS PURPOS E (C E-S AS TUDY)

BY- DHWANI PANDYA EVERON IIPS, AHMEDABAD

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1 WHAT I SYOUR VI EW OF THE EARNING GROWTH OBJEC VE OF C TI OCA-COLA? COCA-C OLA is world’s le ading soft drink com pany which was dealing with declining earning rate since 2003. C cola atte pte to re oca m d place the classic coke and m som ade e changes in it. There were basically 4 reasonsresponsible for low growth rate. COCA-C OLA achie d annual growth in its e ve arnings of shareholders 15-20% till 1991-97.A Redefining its purpose Q.Coca-Cola. [2] . Pe had sm r m t share in m countie but succe psi alle arke ost s ssful in achieving targets after new product development. Till 2004 target was reduced to 3-4% as situation became worst. Coca.cola introduce che coke but this wasn’t succe d rry ssful for longer. C cola e oca arning growth obje s faile due to low capability ctive d of new product development. 1 low growth in the market 2 way that Coca-Cola earns its profits 3 unsuccessful in introducing new products 4 Reluctanceof Company to make profitable equations in future. which was lately protested.

But the couldn’t re y alize this cannot continue longe as the r y have to give their share of profit to bottlers. I t de d to own sm bottling com cide all panie n se the to lage s ll m r bottling markets at higher price By this they could show there sales into profits. Q.Coca-Cola.A Redefining its purpose I t focuse m on m ting its m brand coke than to bring d ore arke ain new product line. [3] . It also owns some bottling companies.2 Do you think that coca cola’s strategy with bottling companies is proper? C cola not only se its products in m ts but works oca lls arke around the world with local bottling companies. This is why its earnings growth objective reluctantly failed. For this re ason it re d its earnings growth obje duce ctive for the latest period.

SUGGESTIONS Firstly it should set smaller targets depending upon the market situation of different countries. growth in e r. I t should m anage the supply chain consistently to avoid disputes with suppliers n share profit with bottling companies. C cola should bring ne product line fre ntly to outcom oca w que e its competitors.3 what do you suggest should be coca cola’s earning objective should be.A Redefining its purpose Q. I t should ke p variable cost lowe which helps it. and why? The are 4 m re ain proble s which re m stricts C oca-C ola’s e arning objective. [4] . n sustain market demand. The first problem is the low growth in the market. The second problem is the way that Coca-Cola earns its profits.Coca-Cola. The third re ason for doubt about the earnings growth obje ctive relates to the successful introduction of new products The fourth proble is the re m luctance of the com pany to m ake acquisitions that might enhance earnings growth. smaller countries.

Coca-Cola. As a re com sult pany should m equations ake which hells company in Entering into ne m ts as we as incre market share in w arke ll ase soft drink market.A Redefining its purpose Marke share rise only whe the are change in com t s n re s pany’s working strategy. [5] . I t is one of the large soft drink companies so to sustain its st growth n m aturity le l it has to com up with ne m ting ve e w arke strategies.

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