Coca-Cola Swot Analysis
This letter will state the key factors to the board and some minor questions that will be discussed in the report to influence our members and to help decide if investment is the right decision. This report will particularly seek answers for the following questions: -Is The Coca-Cola Brand Company an appropriate investment for the Freedom Energy Company, and if so is it worth investing in for a 10-year period? – Is the speculation of Coca-Cola splitting its stock a negative mark on their brand and will that effect our partaking in a company with a bad outlook from the public?
Will global competition overtake the Coca-Cola Company as the top power in their market? The research that has been gathered is from secondary sources that are mainly from creditable online sources. Charts and graphs will also be used to visually show information on the Coca-Cola Company. A strength, weakness, opportunity, and threat analysis will help determine if Coca-Cola’s stock is a sturdy investment for a ten-year period. The results will include potential growth, stamina as a company, global competition, and statements of earnings from the past.
Coca-Cola Swot Analysis Essay Example
We hope this analytical report will help you determine your decision on whether you should invest in the Coca-Cola Companies stock for a ten-year period. My company is confident that we have done the necessary research and utmost analysis needed to help the confidence of your final verdict.
Coca-Cola is the global leader in their market and shows no signs of losing dominance or growth. From their yearly increase in revenue, a ten-year investment period will bring substantial funds to the Freedom Energy Company. The positives far outweigh any risks so the time is now to invest and improve our company’s strength and health. Our conclusion demonstrates that through Coca-Cola’s innovation of products, and world-renowned brand name that they will be a powerful revenue building company.
Our ten-year investment will be sound and sturdy through its period and will most likely make us renew our investment. Key points like the ones below will mention more about our confidence in the Coca-Cola Company. Global Domination: Establishment and product sales all over the globe show that the future for Coca-Cola will only keep growing in sales and supremacy of the soft drink market Quality Products: Since their introduction of the cola drink in 1944, the Coca-Cola Company is known for their satisfying refreshment drinks and products
Family Name: Through huge sponsorships, donations, and family oriented logos like partnership with the McDonalds Corporation; Coca-Cola is known as a family company, which is key for our investment because of the values our company stands by Outstanding History: Since the beginning Coca-Cola has gained its way to the top from its product and attitude to satisfy all audiences. Their amazing growth has shown the dedication of the company to excel through past trials and tribulations to be the very best v Introduction: Investing in Coca-Cola Stock Authorization This report on the Coca-Cola Brand Company Evaluation is submitted on November 12, 2012 to the Board of Directors of Freedom Energy Company in Malibu, CA, to review and determine if investment in the Coca-Cola Company is financially and politically wise. Purpose The Freedom Energy Drink is an all-natural lightly carbonated refreshment that provides all your daily essential nutrients, amino acids, and servings of fruits and vegetables.
The science to make this drink has been unfortunately very pricey so to keep improving our drink we have chosen to invest in another companies stock to hopefully achieve some funds and keep our product out there to take over the energy drink market one day and improve the lives of people. Investment in the Coca-Cola Company will bring quality financial funds over the next ten years to Freedom Energy to help with our growth as a company and the improvement and innovation of our energy drink products. Research Methods To determine whether or not Coca-Cola’s stock is worth investing in, secondary sources were used to gather report data.
The secondary sources used to conduct the investigations are online sources and online graphs and figures. Through stock research from the companies very beginning to present day we can be very confident in our investment because of there steady and improving net incomes (The Coca-Cola Co). Anas Mohammad stated in one of her articles about the excellence of the Coca-Cola company is that they are improving on average 1 to2 percent each year and are the only main company in the drink business who does 80 percent of there business overseas which provides for even more income and growth as a company (Mohammad, Anas). Background: Coca-Cola Brand Company
The Coca-Cola Company is the world’s leading owner and marketer of nonalcoholic beverage brands and the world’s largest manufacturer, distributor and marketer of concentrates and syrups used to produce nonalcoholic beverages. They own or license and market more than 500 nonalcoholic beverage brands, primarily sparkling beverages but also a variety of still beverages such as waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, and energy and sports drinks.
Finished beverage products bearing our trademarks, sold in the United States since 1886, are now sold in more than 200 countries. Along with Coca-Cola, which is recognized as the world’s most valuable brand, they own and market four of the world’s top five nonalcoholic sparkling beverage brands, including Diet Coke, Fanta and Sprite. The company manufactures beverage concentrates and syrups, which they sell to authorized bottling and canning operations (to which Coca-Cola typically refer to as their “bottlers” or “bottling partners”) that use the concentrates and syrups to produce finished beverage products.
Coca-Cola also manufacture, or authorize bottling partners to manufacture, fountain syrups, which sell to fountain retailers such as restaurants and convenience stores which use the fountain syrups to produce finished beverages for immediate consumption, or to fountain wholesalers or bottlers, which in turn sell and distribute the fountain syrups to fountain retailers. In addition, they manufacture certain finished beverages, such as juices and juice drinks and water products, which sell to retailers directly or through wholesalers or other distributors, including bottling partners (The Coca-Cola Company (KO) Stock Description).
Revenues and Potential Growth Revenue From the research and graphics in figure 1 we can establish that the Coca Cola Company has been successful in the last couple years in regards to revenue and will only keep improving. Net income shown in the last column in figure 1 increased from 2009 to 2010 almost two hundred percent, which is very significant and productive. In figure 2 we see that net sales has increased almost every year which installs a lot of confidence in the decision of investing in the Coca-Cola Company for a ten-year period. Figure 1
Source: (Managerial Accounting) Figure 2 Source: (Managerial Accounting) 3 Potential Growth Figure 3 shows that only in 2008 there has been a negative profit for the Coca-Cola Company. Through their global expansion and domination, the potential growth for Coca-Cola is very high. Figure 3’s chart has an estimate for the years 2012-2014 that portrays no decrease in net profit over the next couple financial years which is outstanding.
The strengths and weaknesses will be internal to Coca-Cola and the opportunities and threats will be external to Coca-Cola. The SWOT analysis will is the main source and information to determine if Freedom Energy should invest in the stock of the Coca-Cola Company. Strengths The strengths of the Coca-Cola Company far outweigh the weaknesses. From being the leader in their industry, to the large scale of operations not only in North America but also globally it is easy to see why they are a great company to invest in. Brand Name A strong brand name is one of the main strengths for Coca-Cola.
The Coca- Cola Company has been around since the late 1800’s and there first product “cola” was put into production and on the market in 1940’s. Since the establishment of “cola” the company has developed well-known notoriety all over the globe through the great taste of their drinks and the powerful brand name that brings in huge amount of profit (Swot Analysis of Coca Cola). Global Dominance Coca-Cola is a global company that has made large investments in brand promotions over the years, to improve their dominance in all parts of the world.
To keep on top of the market and beat all other competitors Coca-Cola must focus on expansion globally. Quality Drinks The Company owns or licenses and markets more than 500 nonalcoholic beverage brands, primarily sparkling beverages but also a variety of still beverages, such as waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, and energy and sports drinks (The Coca-Cola Company KO Company Profile). The company owns four of the top five soft drink brands in the World: Coca-Cola, Diet Coke, Sprite and Fanta (Here’s Why Coca-Cola).
Weaknesses Just like any other company, Coca-Cola has a few weaknesses internally, that are small but must be mentioned. 5 Stock Splitting The Coca-Cola Company split their stocks in April of 2012 because the share price had gotten too expensive and the stock was trading too far above similar companies’ stock. Drastic measures like a stock split are causes for worry, especially for a big company like Coca-Cola. Though stock splits can also help companies with liquidity because the share price usually gets a bump immediately following the split.
Time will tell, if the decision to split the companies stock was smart or a poor decision that will affect all shareholders (usatoday30). Sluggish Performance in North America North America is Coca-Cola’s main market that generates about 30 percent of its revenue each year the sale of unit cases last year did not record any growth (Business: SWOT Analysis). Sluggish performance in North America could impact the company’s growth and prevent the company from reaching its set goals and ultimate potential. Opportunities
Opportunities through research of the Coca-Cola Company seem to be endless, mainly because of the company’s international growth and success. Growing Water Bottle Market Bottled water is one of the fastest growing areas in the world’s food and beverage market. The market’s consumption of water bottle volume is over 40 million a year. Coca-Cola owns Dasani, which is the third best selling water bottle in the United States (Swot Analysis of Coca Cola). If the Coca-Cola Company can expand the Dasani brand product more globally, then the company will see enormous increases in revenue.
Expanding Globally Stronger international operations increase the company’s capacity to penetrate international markets and also give it an opportunity of diversity in its revenue stream (Coca-Cola Company). Coca-Cola being such a powerful brand name buys many on the rise businesses to expand their market of products even more to create better fields for opportunity. 6 Threats “Competitive factors impacting the company’s business are the factors that are crucial for them to overcome to keep dominating the market.
As long as the company keeps steady pricing, quality advertising, excellent sales promotion programs, steady product innovation, and trademark development then the company will be a major global company” (The Coca-Cola Co). Intense Competition The company faces intense competition in various markets from regional as well as global players. “Also, the company faces competition from various nonalcoholic sparkling beverages including juices and nectars and fruit drinks”(Mohammad, Anas). PepsiCo is one of the company’s primary competitors, but the market is broad enough to have both corporations succeed without knocking each other off.
Government Health Standards Due to Coca-Cola’s soft drink products being made with high amounts of sugar and other unhealthy ingredients, there is the possibility of government health interference causing product sales to sink, especially in the United States. Government health standards have outlawed soft drinks in places like schools and other pubic places to curtail the health and obesity problems and to promote healthier lifestyles (Lerner, George. ). Conclusion and Recommendation From our discoveries through extensive research and analysis we recommend that Freedom Energy should invest in the Coca-Cola Company.
I have found that Coca-Colas strengths and opportunities far exceed any weaknesses or threats that the corporation may incur. Coca-Cola should continue its reign and further expand its gap between other competitors. Coca-Colas continued success should be able to generate enough profit over the ten-year period of investment to provide for Freedom Energy’s expansion and development of quality health products.