The Coca-Cola Company is the leading producer of beverages in the world. It sells its products in more than two hundred and ten countries with over four hundred and fifty brands of nonalcoholic drinks. The company was introduced in India in 1977 as a soft drink company. This paper explains how the Coca-Cola Company is committed to working in Indian and how it respects Indian culture and her natural environment.
The Coca-Cola Company was founded in 1886 in May, and it entered the Indian market in 1887. The Indian Foreign Exchange Regulatory Act that was implemented by the Janta party to govern all operations of foreign companies in India made Coca-Cola withdraw from the Indian market and cut down all equity stakes to abide by the Act. The company made a return to the Indian market in 1993 when the ban was lifted. From the time it came back, Coca-Cola has spent more than one billion US dollars to invest in the country, thus becoming the largest investor (Hills, 2013).
Cultural and environmental analysis in relation to porter’s five forces
The company has managed to initiate many projects to help the Indian people. Due to the diverse cultures of the Indian people, the company has employed the strategy of initiating projects that cut across all cultures like education, medication, and water management. The company has established primary schools to help children from needy families who cannot afford to pay school fees. In addition to that, the company has initiated countrywide awareness of water conservation by educating the community on the importance of water as well as establishing water projects.
In medication, the company has collaborated with non-governmental organizations and local governments to offer treatment to poor citizens for free or at a subsidized price. In relation to the above, the company offers job opportunities to the local people who are near its plants (Hills, 2013).
According to Porter’s five, the company has a low threat to new entrants in the Indian market. The company has managed to beat this threat by collaborating with its rival company Pepsi to monopolize the whole sector. The two companies signed agreements with bottlers companies to sell them their products, thus hindering them from accepting new deals from different companies. This scares any other company that develops an interest in the business (Hills, 2013).
In response to the serious threat of substitutes, the Coca-Cola Company has managed to produce many different brands that are appealing to the ever-changing consumer market. In addition to that, the company has managed to keep track of new advertising methods hence updating its customers of the new brands in the market (Hills, 2013).
The company uses raw materials that are readily available in the market. There are also many suppliers who supply the materials, and this enables the Coca-Cola Company to have bargaining power for them to get the best price. This aspect demonstrates that the company is well-secured by low supply threats (Hills, 2013).
The main buyers of the company’s products are big groceries, supermarkets, and restaurants. They have tolerant bargaining power, which does not affect the company’s product; instead, it helps the company to regulate the price of its products to the retailers who buy products in small quantities. Coca-Cola’s main rival is Pepsi Company, and their rivalry has stayed for over ninety years. The company has dominated the market far above Pepsi, but Pepsi overcame it during its absence in 1977 when Coca-Cola withdrew from the market temporarily. This has made the company to implement new business strategies in marketing through advertising, and it has shown significant signs of improvement (Hills, 2013).
The strategy that Coca-Cola Company has employed in empowering the community by initiating projects that cut across all the cultures has enabled it to gain a marketing edge in the Indian market. This is because the Indian people perceive the company as one of their own.
Hills, J. (2013). Coca-Cola in India- A case study: CSREM Journal, 12, 120-178.