Case Study No.

1: Strategic Management

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The Carbonated Soft Drinks Industry in Pakistan in the
Context of Coca Cola
1. A Brief History
Coca-Cola Enterprises was established in 1986 as a young company by the
standards of the Coca-Cola system. Yet each of its franchises has a strong heritage in the
traditions of Coca-Cola that is the foundation for this Company. The Coca-Cola Company
traces its beginning to 1886, when an Atlanta pharmacist, Dr. John Pemberton, began to
produce Coca-Cola syrup for sale. However the bottling business began in 1899when two
Chattanooga businessmen, Benjamin F. Thomas and Joseph B. Whitehead, secured the
exclusive rights to bottle and sell Coca-Cola for most of the United States from The
Coca-Cola Company. The Coca-Cola bottling system continued to operate as
independent, local businesses until the early 1980s when bottling franchises began to
consolidate. In 1986, The Coca-Cola Company merged some of its company-owned
operations with two large ownership groups that were for sale, the John T. Lupton
franchises and BCI Holding Corporations bottling holdings, to form Coca-Cola
Enterprises Inc. The Company offered its stock to the public on November 21, 1986, at
adjusted prices of $5.50 ashore. On an annual basis, total unit case sales were 880,000
in1986.In December 1991; a merger between Coca-Cola Enterprises and the Johnston
Coca-Cola Bottling Group, Inc.(Johnston) created a larger, stronger Company, again
helping accelerate bottler consolidation. As part of the merger, the senior management
team of Johnston assumed responsibility for managing the Company, and began a
dramatic, successful restructuring in 1992.Unit case sales had climbed to 1.4 billion, and

total revenues were $5 billion at the year-end. Presently The-Coca-Cola Company is the
largest soft drink company in the world. Every year 800,000,000 servings of just "Coke"
are sold in the U.S alone

2. CCBPL
The Coca-Cola Company began operating in Pakistan in 1953. Coke, Fanta and
Sprite were the brands with which Coca-Cola started operating in Pakistan. The CocaCola System in Pakistan operates through eight bottlers, four of which are majorityowned by Coca-Cola Beverages Pakistan Limited (CCBPL). The CCBPL plants are in
Karachi, Hyderabad, Sialkot, Gujranwala, Faisalabad, Rahim Yar Khan, Multan and
Lahore. The remaining two plants, independently owned, are in Rawalpindi and
Peshawar. The Coca-Cola System in Pakistan serves 70,000 customers/retail outlets. The
Coca-Cola System in Pakistan employs 1,800 people working for the company. During
the last two years, The Coca-Cola Company in Pakistan has invested over $130 million
(U.S) and Coke has successfully provided 51 years of service to its customers in Pakistan.

3. Mission Statement (in the Companys own words)

Our Roadmap starts with our mission, which is enduring. It declares our purpose
as a company and serves as the standard against which we weigh our actions and
decisions:
To refresh the world...
To inspire moments of optimism and happiness...
To create value and make a difference

4. The Vision (quoted verbatim)

Our vision serves as the framework for our Roadmap and guides every aspect of
our business by describing what we need to accomplish in order to continue achieving
sustainable, quality growth.
People: Be a great place to work where people are inspired to be the best they can
be.
Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate
and satisfy people's desires and needs.
Partners: Nurture a winning network of customers and suppliers, together we
create mutual, enduring value.
Planet: Be a responsible citizen that makes a difference by helping build and
support sustainable communities.
Profit: Maximize long-term return to shareowners while being mindful of our
overall responsibilities.
Productivity: Be a highly effective, lean and fast-moving organization.

Our Winning Culture

Our Winning Culture defines the attitudes and behaviors that will be required of us
to make our 2020 Vision a reality.
Live Our Values
Our values serve as a compass for our actions and describe how we behave in the
world.
Leadership: The courage to shape a better future
Collaboration: Leverage collective genius
Integrity: Be real
Accountability: If it is to be, it's up to me
Passion: Committed in heart and mind
Diversity: As inclusive as our brands
Focus on the Market
Focus on needs of our consumers, customers and franchise partners
Get out into the market and listen, observe and learn
Possess a world view
Focus on execution in the marketplace every day
Be insatiably curious
Work Smart
Act with urgency
Remain responsive to change
Have the courage to change course when needed
Remain constructively discontent
Work efficiently
Act Like Owners
Be accountable for our actions and inactions
Steward system assets and focus on building value
Reward our people for taking risks and finding better ways to solve problems
Learn from our outcomes -- what worked and what didnt
Be the Brand
Inspire creativity, passion, optimism and fun

5. Brand Portfolio in Pakistan

Coca Cola Beverages offers the following brands in Pakistan:

Coca Cola
Sprite
Fanta
Sprite 3G
Coke diet
Sprite Zero

6. Today
Today, CCBPL is operated directly under the supervision of Coca Cola. It has 10
Plants all around in Pakistan:

Karachi.

Lahore

Gujranwala

Rawalpindi

Peshawar

Hyderabad

Faisalabad

Sialkot

Rahimyar khan

Multan

Sahiwal

7. Market Share
According to a Wall Street Journal report, Pepsi though still the market leader,
has lost significant market share to Coca Cola because of the latters sponsorship of Coke
Studio. As of July 2010, Coke claimed 35% of all cola sales in Pakistan while Pepsis
market share was 65%, down from a dominant 80% in the 1990s that it mainly gained by
sponsoring cricket. However, PepsiCo still remains Pakistans No. 1 Soft Drinks
company.

8. Further Investment
The Coca-Cola Company plans to invest $379 million on manufacturing facilities
across Pakistan over the next three years, according to a report released in June 2013.

9. Social Responsibility
9.1 Environment Conservation: Coca-Cola Pakistan, in collaboration with WWFPakistan, organized a clean-up drive to clean the most visited tourist site of Pakistan,
Lake Saif-ul-Mulook. The clean-up drive is part of Coca-Cola and WWFs ongoing
project titled Environment Conservation Project.
9.2 Lighting a Million Lives: Coca-Cola Pakistan, in collaboration with Buksh
Foundation, has electrified 10 off-grid villages in the Sahiwal District of Punjab via the
solar energy project, Lighting a Million Lives.
9.3 EMPOWER: EMPOWER is an innovative program launched by Coca-Cola Pakistan
to provide extra-curricular learning to university-going youth of the country, through
inspirational talks delivered by experts from various fields.

10. Problems
10.1 Distribution
Coca Cola Company is facing a problem in distribution, as distributors are
expecting more from Coca Cola to encourage retailers to provide space to their products,
in the form of providing refrigerators. Its competitor, Pepsi Cola, is far more effective in
providing such facilities to distributors, which gives it a vital competitive edge. Pepsi
Cola also provides better incentives like upfront discounts to its distributors, wholesalers,
and retailers.
10.2 Promotion
Coca Cola seems to rely only on a one-dimensional promotion strategy, which is
music in the form of Coke Studio. On the other hand, Pepsi has chosen a far more
appealing platform, which is Cricket.