Swot analysis of coca cola 2018

Running head: ASSIGNMENT 1

Assignment

By

Mattie Ealey

Unit II

Columbia Southern University

October 16, 2019

Introduction

ASSIGNMENT 2

The purpose of this assignment is to provide a SWOT analysis for a publicly traded company.

The company chosen for the purpose of current analysis is Coca Cola which is a

multinational firm and one of the oldest companies operating in the food and beverages

sector, all around the globe (Coca Cola Company, 2018). SWOT analysis is a tool that

provides a holistic view of the company’s current position and options for the future growth

as well. The full form for SWOT is Strengths, Weaknesses, Opportunities and Threats. Each

of the element has been described in detail with emphasis on the Coca Cola Brand.

Strength

This pertains to the core strengths of the company that the organization is currently using in

its operations and to achieve the expected performance level. The major strength that Coca

Cola has is its brand name which is well-known for years among the target audience and that

continues to exist for the upcoming generation as well due to their extensive marketing and

presence on the digital media and social media platforms. Moreover, another major strength

for Coca Cola is the fact that the over so many years, its main target audience has continued

to buy the products. This shows the brand loyalty and customer loyalty that the company

enjoys and is able to cash as well in terms of the huge number of sales and highest share in

the market. Also, the company is very much active in terms of the social corporate

responsibility in the form of education, building societies such as producing light lamps

through the Coca Cola water bottles or even collecting money for charity etc.

Weaknesses

This element deals with the major areas that are considered to be the weak areas of the

company and require improvement or development. One of the major weaknesses for Coca

Cola as a brand is that this brand is well-known in the section for carbonated drinks. Hence,

the area of its brand existing and brand availability is very particular to one product and

ASSIGNMENT 3

therefore, the focus appears to be very concentrated. Hence, the overall product portfolio of

the company is very undiversified towards the food and beverages industry which creates

issues such as increase in the risk exposure for the company. However, the company has been

trying to diverse its risks by moving into other businesses as well over the course last years.

With its aim to expand quickly and into other areas without any prior knowledge or

experience, there are many different products that have failed in the market as well. Also, for

this objective of diversification, the company has been involved with a lot of acquisitions as a

result of which, it has a very high debt ratio (Innovation Enterprise, 2016).

Opportunities

This element highlights the major opportunities that exist for the company internally as well

as externally. One of the major opportunities that exist for the company is the growing

demand for healthy drinks and other food products. There is particular growth in the

emerging markets. Moreover, the major opportunities that the Coca Cola Company has been

trying to freeze through its acquisition and diversification strategy is the new businesses that

are emerging. Coca Cola has been trying to capture opportunities in the market through its

portfolio expansion strategy as the current portfolio of the company is very exclusive towards

the beverages and food industry. By moving into other areas, the risks are diversified and the

company is able to increase its sales and sources of revenue generation, particularly, since is

current portfolio of food and beverages is at its mature stage and the growth is somewhat

limited. Hence, the following is the list of opportunities for Coca Cola Company (Pratap,

2018)

1. Increased demand for the healthy drinks

2. Increased demand for healthy food consumption

3. Increased demand for the healthy beverages and food in the emerging markets

ASSIGNMENT 4

4. Increased opportunity through acquisition

5. Increased areas of diversification reduce risks

6. New technological advancements

7. New research and development for new products

8. Increasing start-up culture leading to further growth opportunities through

acquisitions and seed funding and other investment options.

9. Entering different industries

10. Reduction in prices of raw material

Threats

This element identifies the major threats for the company, both internal as well as external.

These are the factors that can become a hurdle in the operational activity of the company and

will not prevent the company from achieving its objectives. Some of the major threats for the

company include the following (Pratap, 2018):

1. Increased competition in the industry, particularly, the industry for beverages and

carbonated drinks

2. Increase in substitute drinks for the Coca Cola carbonated and other beverages

3. When entering into different markets, particularly emerging countries, there are

several local brands that the company has to deal with.

4. Lack of prior knowledge and experience when entering into new industries through

acquisitions.

5. The ever-changing changes in the consumer tastes is always a threat

6. Increasing water scarcity

7. Increased legal requirements and regulatory requirements in different countries

ASSIGNMENT 5

8. Strong Currency fluctuations leading to changes in the imported material prices and

exports

9. Decreasing margins

10. Weak product portfolio

Conclusion

Each of the above elements in the SWOT analysis provides an insight into the market

position of the company currently and its expected position in terms of how the company

seeks to grow in the market.

References

Coca Cola Company. (2018). Coca Cola History. Retrieved from https://www.coca-

colacompany.com/history

Innovation Enterprise. (2016). Coca-Cola And Diversification: A Love Story. Retrieved from

https://channels.theinnovationenterprise.com/articles/coca-cola-and-diversification-a-

love-story

Pratap, A. (2018). SWOT Analysis of Coca Cola 2018. Retrieved from Notesmatic:

https://notesmatic.com/2018/07/coca-cola-swot-analysis-2018/

The Coca-Cola Company. (2018). A short history of Coca-Cola. Retrieved from

https://www.coca-colacompany.com/annual-

review/2011/pdf/TCCC_125Years_Booklet_Lo.pdf