As a practicing manager, you will often be asked 1) to prepare and present analyses of a business situation facing the organization, and 2) to evaluate recommendations about your organization made by others (colleagues, external consultants, etc.). The case analysis and critique is designed to give you practice in both roles.
Analysis: First, you will be asked, in randomly selected groups, to prepare an analysis of a case. Your case analysis presentation will be in two forms: written and verbal. Your written report will be due, in hardcopy, a day before the presentation by 9 pm. In fairness to all members of the class, late papers will be penalized.
Please read and follow the guidelines for case analysis on how to approach your case analysis and structure your write-up. The guidelines for case analysis document will be available on Moodle. Note that all case write-ups must include an analysis of key issues, a discussion of various alternatives and their pros and cons, and clear recommendations. You should, however, stay within the bounds of the case presented: it is not necessary to conduct outside research.
You may feel that important information is vague or missing. Welcome to the real world. At some point in real situations, time does not permit gathering more information. Note what information is missing or ambiguous and state clearly the assumptions you’ve made to deal with this. This is a valuable skill also for case interviews: to show the logic you’ve used in the presence of incomplete information.
Grading of the analysis will be done as follows: a grade will be assigned to your written analysis (which was handed in the day before your verbal presentation). This grade will be adjusted up or down based on your verbal presentation.
In fairness to all, your write-ups must adhere to the following format (in MS Word): double spaced, 1” margins all four sides, 12 point, Times New Roman font, 10 pages of text. You may include up to 3 additional pages of Exhibits. The general rule is that the 10 pages of text must stand on their own, and the Exhibits are to supply only background material and analysis for readers who require more details. Typically, the Exhibits include Tables and Graphs. Deviations from this format will be penalized.
- Why, historically has soft-drink industry been so profitable?
- Compare the economics of the concentrate business to that of the bottling business: Why is the profitability so different?
- How has competition between Coke and Pepsi affected the industry’s profits?
- How can Coke and Pepsi sustain their profits in the wake of flattening demand and the growing popularity of non-CSD’s?
“Product Differentiation – customers may come to believe that a firm’s prod- uct is unique. This belief can result from the firm’s service to the customer, effective adver- tising campaigns, or being the first to market a good or service. Greater levels of perceived product uniqueness create customers who consistently purchase a firm’s products. To com- bat the perception of uniqueness, new entrants frequently offer products at lower prices. This decision, however, may result in lower profits or even losses. As noted in the Opening Case, Coca-Cola Company and PepsiCo have established strong brands in the markets in which they compete, and these companies compete against each other in countries throughout the world. Because each of these competitors has allocated a significant amount of resources over many decades to build its brands, cus- tomer loyalty is strong for each firm. When considering entry into the soft drink market, a potential entrant would be well advised to pause to determine actions it would take for the purpose of trying to overcome the brand image and consumer loyalty each of these giants possess. “ (word for word from text)
The 75 billion dollar industry of the carbonated soft drink is constantly battled by two of the biggest soft drink competitors, Coca-Cola Co., and PepsiCo Inc. For more than 100 years these soft drink companies have been competing for the top spot in this industry and continue to undermine one another for the most consumption and largest revenue. However, in the early 2000’s as health conscious Americans began to decrease their consumption of Carbonated Soft Drinks (CSD), Coca-Cola and Pepsi began to face the new threats of the ever changing external environment.
In 1886 a pharmacist by the name of John Pemberton created the first Coca-Cola product and sold it at drug store soda fountains claiming that it was a “potion for mental and physical disorders.” (Yofie & Kim, 2011). Asa Chandler had acquired the formula in 1891 and began brand advertising the soft drink. After trademark infringements from counterfeit brands and a new patent, the signature drink became an all American favorite.
In 1893 another pharmacist by the name of Caleb Bradham had developed the Pepsi-Cola and after claiming bankruptcy twice the brand had made a name for itself by dropping the price of their 12oz bottles to a nickel during the great depression, which was half the price of a Coca-Cola.
After Coca-Cola had filed an infringement suit against Pepsi and the courts ruled in Pepsi’s favour is when the “Cola Wars” began. (Yofie & Kim, 2011). The growth in the number of supermarkets and convenience stores following the war began to initiate Pepsi’s growth.