Question

Read the Article posted below, then answer the following questions, Please fully answer the following questions about the case.

(1000 words all together if possible)

(typed no pictures)

1) Present a general overview of the US Beverage Manufacturing & Bottling industry. Specifically, discuss major trends, competitors, their products and relative market share.

2) Perform a PESTEL analysis. This includes discussing the general environment factors affecting the beverage industry’s Performance such as economic, political/legal, socio-cultural, demographic, technological and global issues.

3) Perform Porter’s five forces analysis on the beverage industry.

4) Assess the beverage industry’s attractiveness in terms of growth and profitability. Specifically, present a comparative chart on the beverage industry on ROA, ROE, Debt to Equity (D/E), Current Ratio, and end of year stock prices between 2006- 2011 inclusive.

5) In your opinion, what are the beverage industry's Key Success Factors (KSF)? What are the most CRITICAL factors that lead to success in this industry?

6) Identify and discuss major strategic challenges the industry is facing and possible solutions to these challenges.

Article:

Answer 1

1) Present a general overview of the US Beverage Manufacturing & Bottling industry. Specifically, discuss major trends, competitors, their products and relative market share.

Ans: General overview of US Beverage Manufacturing and Bottling industry :

-The industry is made up of about 3000 companies, including manufacturers, bottlers and distributors of non-alcoholic beverages

-Over 90% of the combined $70 billion in annual revenues are generated by three companies- Coca Cola, Pepsi Co and DPS and their subsidiaries

-Carbonated soft drinks, including colas and other flavours, bottled waters, juices and a variety of syrups and mixes are this industry's major products

Major Trends:

-Factors such as economic stability, seasonality, commodities prices & consumer tastes and preferences are of great importance to beverage company managers who develop and implement strategies partly for the purpose of successfully dealing with changes in the industry

-Most significant factor is economic stability. Since carbonated soft drinks are discretionary items, sales are considerably impacted by weakness in the economy.

Competitors & their products:

-Major competitors in the manufacturing segment include the Coca-Cola Company (Coke), PepsiCo Inc (Pepsi), Nestle S.A & Kraft Foods Inc. Major competitors in the bottling & distribution segment include Coca-Cola Enterprises, Pepsi Bottling Group and numerous small bottlers and distributors

-Coke products: Coca-Cola, Diet Coke, Fanta and Sprite and 500 more brands

-Some of the Pepsi's key brand are: {Pepsi, Pepsi One, Diet Pepsi, Mug, Mountain Dew, Sierra Mist, Frito-Lay, Dorito's, Cheetos, Quaker, Tropicana etc.

-DPS products: 50 brands of carbonated soft drinks, juices, mixers, teas & other beverages including Mott's juices, 7 UP, A&W, RC Cola, Squirt, Sunkist Soda, Canada Dry, Schweppes etc

Relative Market Share:

-DPS generates 89% of its revenues in the US market. Coke collects about 74% of its sales outside of North America & Pepsi generates 40% of its sales internationally.