Third, by producing on a global basis and selling more of its products Coca-Cola is able to benefit from economies of scale. For example, it will be able to exert enormous power over suppliers and retailers through the sheer scale of its buying and selling operations resulting in significant cost advantages. It may also gain from marketing economies, such as in advertising.
Fourth, Coca-Cola will be able to locate its business operations wherever it most advantageous in terms of cost and quality. Furthermore, it many are able to better withstand poor trading conditions in one particular market. If products are performing poorly in Mexican for instance, which is experiencing economic problems, this might be offset by a growth in sales in new market economies in eastern Europe such as Hungary, which consumes 153 serving f Coca-Cola per head per year.
Lastly, by operating globally Coca-Cola will be able to engage in joint ventures with businesses in local markets and take advantages of their local knowledge and distribution networks. Anchor bottlers, fort example had the management and resources to match the growth targets of the economy.
The principle threat for Coca-Cola arising from the globalisation of the world economy ids competition from other drinks manufacturers. It is possible that the hypercompetitive state of many global markets may create future difficulties for Coca-Cola. For example, drinks companies in the Newly Industrialised countries (NICs) may emerge in the 21st century as a threat to Coca-Cola.
In addition just as Coca-Cola has benefited from a convergence of consumer tastes which have accompanied globalisation and which has resulted in consumers all over the world drinking its products, so it may suffer from a shift in global drink tastes away from cola drinks, which form the core of Coca-Cola’s business.
Furthermore there is also evidence in the article which suggests that a global approach is not always effective. Despite producing one of the world’s most famous advertisements, it did not sell much of the product. The business changed strategy as a result away from single theme advertising, to take into account the nature into which the company is selling.
Lastly, a global approach requires massive investment and expenditure. If the world economy is in recession which particularly affects the USA and other countries buying Coca-Cola products, then the business may be greatly affected.
Furthermore there is also evidence in the article which suggests that a global approach is not always effective. Despite producing one of the world’s most famous advertisements, it did not sell much of the product. The business changed strategy as a result away from single theme advertising, to take into account the nature into which the company is selling.
Lastly, a global approach requires massive investment and expenditure. If the world economy is in recession which particularly affects the USA and other countries buying Coca-Cola products, then the business may be greatly affected.
Furthermore there is also evidence in the article which suggests that a global approach is not always effective. Despite producing one of the world’s most famous advertisements, it did not sell much of the product. The business changed strategy as a result away from single theme advertising, to take into account the nature into which the company is selling.
Lastly, a global approach requires massive investment and expenditure. If the world economy is in recession which particularly affects the USA and other countries buying Coca-Cola products, then the business may be greatly affected.
Furthermore there is also evidence in the article which suggests that a global approach is not always effective. Despite producing one of the world’s most famous advertisements, it did not sell much of the product. The business changed strategy as a result away from single theme advertising, to take into account the nature into which the company is selling.
Lastly, a global approach requires massive investment and expenditure. If the world economy is in recession which particularly affects the USA and other countries buying Coca-Cola products, then the business may be greatly affected.
