Since the mid 1980’s many of us have become familiar with the terms “the Cola Wars” (Wikipedia, 2010). Coca Cola and Pepsi have been the two largest soft drink competitors in the world for quite some time now. What makes these companies successful? What gives them the retention to prosper for years across the globe? For this project I analyzed the financial statements from 2003 through 2005 of both companies to gain insight as to these questions and others. By reviewing and then analyzing the data it becomes visible that these two companies are still standing strong in a market that is still dominated only by each other. To begin we will examine three ratios for each company. The first ratio is a liquidity ratio. Liquidity focuses on the reliability or availability of a borrower to pay back the loan they borrowed. A common liquidity metric is ccurrent ratio. Current ratio measures a company’s ability to pay back short term obligations or debts. We get this calculation by taking the current assets and dividing by current liabilities. For instance, PepsiCo’s current ratio is equivalent to current assets in 2005 (10,454) divided by current liabilities in 2005(9,406) which equals 1.11:1. Their current ratio in 2004 was 1:28:1. (Current assets for 2004/current liabilities for 2004; 8639/6752). Coca Cola’s current ratio for 2005 was taken by computing their current assets for 2005 (10,250) and divided by the current 2005 liabilities 99836) which equaled a ratio of 1.04:1. In 2004 Coca’ Cola’s current ratio was equal to current assets for 2004 of 12,281 divided by current liabilities for 2004 of 11, 133, which totaled 1.10:1. What this means is that for every dollar of current liabilities, Coca Cola has $1.04 of ... ... middle of paper ... ...ges and soft drinks. They have ventured out to non carbonated beverages like iced tea and juices but now need to move into the food market space. My final recommendation for Coca cola is to stay with their product. One of the biggest setbacks for Coca Cola occurred when they introduced their “new coke” in the 1990’s. (Wikipedia, 2010) This new formula did not go over well with their consumers and they were forced to quickly stop the new Coke production. In conclusion I think both companies are stable and strong. Obviously both companies are able to compete globally which in and of itself says an awful lot. Each company has its strengths and minor weaknesses but their overall financial success has been proven. Their ability to remain the only two competitors amongst their carbonated beverage industry is a strong indicator of their future potential.
Pepsi was first represented in the beginning of 1890 with the purpose to relieve indigestion. Not until 1960’s, Pepsi received successes that competed against Coca-cola. Pepsi has always been a drink for the young generation, but now they want to change the association.
Coke continuously out-stands Pepsi, even though they share a very similar taste and colour, however Coke should not be the drink that receives all the love and attention for what it offers. Despite their similar soda colour, the drinks actually contain some different ingredients, which produce a different taste, and affect the body differently. Furthermore, the way the companies markets their drinks makes a huge contribution to how successful their products will become. The major element for success however stems from their impact on society and how the companies utilize their social power to evolve. The two major soda companies are constantly head to head with one another, yet it is what they do that sets them apart.
Analysis of the Coca-Cola Company The Coca-Cola Company is the world's leading manufacturer, marketer and distributor of soft-drink concentrates and syrups. The Coca-Cola Company is the world's leading manufacturer, marketer and distributor of soft-drink concentrates and syrups. The Company markets many of the world's top soft drink brands, including Coca-Cola, Diet Coke, Sprite and Fanta. Through the world's largest and most pervasive distribution system, consumers in nearly 200 countries enjoy the Company's products at a rate of more than one billion serving a day.
Control of market share is the key issue in this case study. The situation is both Coke and Pepsi are trying to gain market share in this beverage market, which is valued at over $30 billion a year. Just how is this done in such a competitive market is the underlying issue. The facts are that each company is coming up with new products and ideas in order to increase their market share.
you can have a turn on the fortune wheel to win prizes such as Pepsi
Coke and Pepsi have been raging war for over a century now, turning their sodas into a multi-billion-dollar industry. Coke has been able to drive more earnings for its bottom line, and while Coke’s net income has been trending downward in recent years, it manages to stay ahead thanks to superior margins. Pepsi, on the other hand, has produced consistent net profit margins of around 10%, while Coke margins have been in the 15-18% range for the past several years (O’Brien). Every company has a Market Cap, which is basically a fancy way of saying how much the company is worth, and Coca-Cola’s market cap is a whopping $180 billion. Pepsi’s Market Cap is $150 billion, which may not seem like a big difference, but $30 billion is a lot of cheddar. Therefore, Coca-Cola owns 51% of the soft drink market, whereas Pepsi only owns 22% of it. Coke claims to own a total of 35 different brands, including Fanta, Sprite, Powerade, Vitaminwater, and many others. Pepsi owns 22 different brands, including 7up, Gatorade, and Mountain Dew “Coke (Coca-Cola) vs Pepsi - Soda
As we all should know, PepsiCo is one of the world’s leader in convenient food and beverages. PepsiCo shares are traded worldwide and particularly in NYSE (United States). PepsiCo is in the same line with Coca cola and Cadbury Schweppes as the dominating beverage companies. PepsiCo has successfully built a great brand name rivaling with coca cola, probably because PepsiCo unlike coca cola has its own bottling companies. With a competitive strategy based on differentiation rather than cost leadership like its fellow competitors PepsiCo invests highly in new packaging, flavors, formulas to outsmart their competition. Founded in 1919, producing a variety of sweet and grain-based snacks, carbonated and non-carbonated
Weaknesses – Coca-Cola is a very successful company with an impeccable social media following. Word of mouth is probably a strength, but only when feedback from consumers is positive, but there are people who are against Coca-Cola and their products. Even though Coca-Cola produces over 200 brand products, Coca-Cola lacks the social media popularity of other brands that they produce (Moth, 2013). Many drinks that they produce are extremely popular such as Coke or Sprite, but there are a lot of Coca-Cola products that are unknown, unseen, and unavailable for
Learning from experience Coca-Cola has had some fierce competition over the years but nothing in the form of an entire health market shift like now. As well as mounting political persecution of its products like they are facing today. They must rely on past experiences to get through but likely will need to start studying the new trends to stay relevant.
The main threat of the company is not from the local producers but from the global producer Pepsi Co that has similar product line and methods of manufacturing and distribution.
The purpose of this report is to compare financial reports from the two largest soft drink manufacturers in the world. The Pepsi Co. and Coca Cola have been the industry's leaders in their market since the early 1900's. I will use relevant figures to determine profitability, and break down key ratios in profitability, liquidity, and solvency. By breaking down financial statements, and converting them to percentages and ratios, comparisons can be made between competitors regardless of size.
Coca-Cola is a company with sustainable competitive advantage. The company is innovative and has an extensive business model with boasts of a sustainable distribution network. The company was incorporated in the late 1800s to commence the production of a sweet fizzy beverage that has become the world's most known brand. Presently, the company is still on an upward trajectory as it remains one of the world's most sought-after stocks. The company's competitive advantage has shown resilience and sustainability over the years.
Cola Wars came into existence since 1980’s though marketing campaigns of soft drinks rivals such as coca cola. Different kinds of challenges were being posed by companies like Pepsico and coca cola for marketing their products by innovating products through line extensions and entirely positioning different products for customers at worldwide basis. The modifications were being done in pricing strategy, bottling of products like soft drinks and brand positioning.
The Coca-Cola company was founded in 1886 by John Pemberton, a Civil War veteran and Atlanta pharmacist. He was inspired by his curiosity as he stirred up a fragrant, caramel-colored liquid that he brought down to a place called Jacobs’ Pharmacy. There he added carbonated water and let several customers sample the new concoction. Jacobs’ Pharmacy put it on sale for five cents a glass and named it Coca-Cola. This “inspired curiosity” has now grown to be the world’s leading manufacturer, marketer, and distributor of nonalcoholic beverage concentrates and syrups. In 1906 Coca-Cola opened bottling plants in Canada, Cuba, and Panama. Today they produce nearly 400 brands in over 200 countries. More than 70% of their income comes from outside the U.S. (1). This paper will focus on an analysis of operations of the statement of cash flow reports and a vertical and horizontal analysis of the consolidated balance sheets. Also an analysis of the global financial condition of the Coca-Cola Company and the value of goodwill and other intangible assets will be discussed.
The case study "Cola Wars Continue: Coke and Pepsi in the Twenty-First Century" focuses on describing Coke and Pepsi within the CSD industry by providing detailed statements about the companies’ accounts and strategies to increase their market share. Furthermore, the case also focuses on the Coke vs. Pepsi products which target similar groups of customers, and how these companies have had and still have great reputation and continue to take risks due to their high capital. This analysis of the Cola Wars Continue case study will focus mainly on the profitability of the industry by carefully considering and analyzing the below questions. Why is the soft drink industry so profitable? Compare the economics of the concentrate business to the bottling business: Why is the profitability so different?