According to Porter, 2008, Awareness of the five forces can help a company understand the structure of its industry

and stake out a position that is more profitable and less vulnerable to attack. In the wake of this statement let us analyse the position of Coca Cola and also recommend them some options to improve their position. The position of Coca Cola with respect to Porters Five Forces are enumerate below: 1. Threat of New Entrants (Very Low): As the Industry requires high Fixed Costs for Production, Packing, Supply Chain and Marketing & Advertising Activities the threat of new entrants is low. Apart from that the company also has agreements with their existing bottlers that prevent them from providing services to other manufacturers. The retailers also enjoy large margins from the company and its rival Pepsi-Co, that prevent new entrants from entering industry as they shall not be able to replace either the Brand Name or the Loyalty or the market share of Coca Cola by providing such large margins. 2. Threat of Substitutes (Moderately High): Both the carbonated Soft Drinks (CSD) cos. viz. Coke and Pepsi face a considerable threat of substitution from beverages like Tea and Coffee, Sports and Energy Drinks, Health Drinks. Apart from this the recent trend of avoiding High Calorie drinks like CSDs, consumers are looking for and switching to other healthier alternatives (Annual Report, 2011). For example Starbucks has recently been seen becoming more popular, as the same sells coffee, that too with different flavours, that contains caffeine like CSDs, and is becoming more appealing. The low switching costs of consumers make threat of substitutes moderately high. 3. Bargaining Power of Suppliers (Very Low): The major suppliers to Coca Cola are raw materials like colour, flavour, sugar, additives and caffeine providers, and bottlers. Coca Cola till recently got their bottling done by Coca Cola Enterprises, which is the worlds largest bottler, with which it integrated recently to save about $350 million an year for next four years (Press Release, Oct 2010). Also as far as the raw materials are concerned, almost all the suppliers provide the same product, and as such they have very low bargaining powers. Apart from the fact that any unnecessary bargaining could lead to disassociation from such a large brand, with whom others are virtually always ready to be associated. 4. Bargaining Power of Buyers (Moderate): The reason is that there is virtually no bargaining power of the individual consumer, and especially not from the loyal customers, but the large grocery stores, super markets, stores and restaurants and food joints, can and do exercise some bargaining, as they are large volume buyers for example, the like of McDonalds and Wal-Mart.as such the barging power of the buyers in the case of Coca Cola and its rival PepsiCo, in the CSD segment is moderate. 5. Competitive Rivalry (Very High): The CSD market is characterised by the fiercest rivalry as compared to probably in any other product market. Reason is that the market is virtually a

Duopoly market, as Coca Cola and PepsiCo own virtually all the brands in this segment and the other few players have virtually have no market share as compared to these two. As such both the players are always in the slew of gaining market share by trimming the others. And as such both the companies engage in competing each other on virtually all the fronts like advertising, product launch and not to mention their famous price wars. Given the above analysis, and the information on the companys product portfolio, past growth and market share and the future plans available from the Annual report of the company, and also from that of its rival PepsiCo the following recommendations seem plausible: a. The company should not only focus on the CSD segment but also venture into the other foods and beverages segment like PepsiCo has done. Reason being that unless it does something constructive and fruitful in that segment, PepsiCo is gaining the Mind Share amongst consumers. b. The Company has virtually stopped, after the release of Diet Coke, bringing any new health or wellness product in the market. Unlike Pepsi, which has not only the CSD segment but also food and beverages segment to launch new health and wellness products, that the new and ole health conscious generation is looking out for, which is being served by PepsiCo. 6. The company has only recently started vertical integration when it took control of Coca Cola Enterprises. However the company should also look for further forward and backward integration along with both horizontal and vertical diversification, if it is to sustain in the mind share of consumers and also to maintain as well as gain market share.

REFERENCES: 1. (Porter, 2008) Article titled The Five Competitive Forces That Shape Strategy by Michael E. Porter 2. (Annual Report, 2011) The Coca Cola Company Annual Report 2011 Available at http://www.thecoca-colacompany.com/investors/pdfs/form_10K_2011.pdf 3. (Press Release, Oct 2010); The Coca-Cola Company Reports 2010 Third Quarter and Year-To-Date Results Available at http://www.coca-colacompany.com/media-center/press-releases/the-coca-cola-companyreports-2010-third-quarter-and-year-to-date-results 4. (Hans) Article titled Porters Competitive Forces Porters Competitive Forces by Prof. Dr. Hans Akkermans Available at http://e3value.few.vu.nl/docs/misc/Porter.pdf 5. (Laxmi, 2007) Article titled Cola Wars: Five Forces Analysis by Laxmi Goutham Vulpala Available at http://goutham.wordpress.com/2007/10/18/cola-wars-five-forces-analysis/