Spenser Garrison Strategic Management 3/17/10 Case 1: Cola Wars Continue: Coke and Pepsi in 2006 The soft drink industry is very competitive for all companies involved. Recently the competition between established firms has only increased with the market nearing its saturation point. All companies in the industry‚ especially those thinking about entering‚ have to think about Porter’s 5-Forces model and the pressures it outlines; rivalry among establish firms‚ risk of entry by potential
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Oligopoly An oligopoly is a market form in which a market or industry is dominated by a small number of sellers (oligopolists). Oligopolies can result from various forms of collusion which reduce competition and lead to higher costs for consumers.[1] With few sellers‚ each oligopolist is likely to be aware of the actions of the others. The decisions of one firm therefore influence and are influenced by the decisions of other firms. Strategic planning by oligopolists needs to take into account the
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Cola Wars Continued – Coke vs. Pepsi in 2006 Reading the case‚ special attention should be paid to the underlying economics of the soft drink industry and its relationship to average profits‚ the relationship between the different stages of the value chain in the industry‚ the relationship between competitive interaction and industry profits‚ and the impact of globalization on industry structure. While preparing the case‚ you should start by carefully characterizing the carbonated soft drink
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Dan Sweeney March 7‚ 2012 1. & 2) Short-term: The quick ratio‚ also known as acid-test ratio‚ calculates a company’s cash and accounts receivable divided by its current liabilities. This ratio is a more stringent measure of liquidity than the current ratio in that it excludes inventories and other current assets. Pfizer has a quick ratio of 1.78 while the industry median is 1.21. This shows the company does not rely too much on inventory of other assets to pay for short-term liabilities.
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new flavor6 Battle shifts to International Markets6 Pepsi troubles in Brazil6 Intrigue in Venezuela7 Pepsi’s problems elsewhere in International Markets……………………………………………………………………………7 Coke faces problems in Europe8 Issues of Contamination8 Coca Cola finally acts aggressively9 Pepsi’s Competitive maneuver near the millennium10 Pepsi’s role in Coke’s European problems.10 Pepsi’s antitrust initiations against Coca Cola 10 Coke and Pepsi in the Subcontinent10 Literature Review.12 Theoretical
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a small group of firms. ! An oligopoly is much like a monopoly‚ in which only one company exerts control over most of a market. In an oligopoly‚ there are at least two firms controlling the market. The retail gas market is a good example of an oligopoly because a small number of firms control a large majority of the market. An oligopoly is a market form in which a market or industry is dominated by a small number of sellers (oligopolists). Oligopolies can result from various forms of
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Cola Wars Continue : Coke and Pepsi in 2006 1. Why historically has the soft drink industry been so profitable? * High rate of consumption increasing at an average of 3% per year * Increasing availability of CSDs * Introduction of diet and flavoured varieties Year | 1970 | 1975 | 1981 | 1985 | 1990 | 1994 | 1996 | 1998 | 2004 | Consumption in Cases (million) | 3090 | 3780 | 5180 | 6500 | 7780 | 8710 | 9290 | 9880 | 10240 | 2. Compare the economics of concentrated
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Cola Wars Continue: Coke and Pepsi in 2010 Consider the CSD industry. Have Coke and Pepsi’s profits historically been high? Do you consider it surprising or not surprising given the product they produce? In the CSD industry‚ the highest net profit-sales ratio of Coke and Pepsi are 21.1% and 14.3%‚ and the steadily growth is also surprising.so the profits are high. The content is water‚ Coke syrup‚ CO2‚ and additives‚ which cost about 10 cents per can‚ nearly next to nothing. What are the primary
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Strategy ‘Cola Wars Continue: Coke and Pepsi in 2010’ Analysis of the US carbonated soft drinks (CSD) industry (a) Strategic issues The CSD market in the US (approx. $74 billion) is dominated by two concentrate manufacturers – namely Coke and Pepsi –. Both companies have been competing intensely since the 1970s‚ yet have thrived from this competition and have grown the business very profitably‚ as both have benefitted from the CSD market growth rates of around 10% p.a. until the early 2000s
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For all the questions‚ Coles and Woolworths illustrate significant knowledge of the market‚ indicating that they are a present duopoly. Their selling power is shown through the knowledge of identifying the lowest price. The duopoly had two selling statements concerning competitors in which the average answer for both statements was higher that the local retailers. This can be justified through the buyer’s knowledge of where to purchase the cheapest products‚ having the highest average response of
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