Strategic Management: A Competitive Advantage Approach Concepts and Cases 17th Edition Instructor ma

 
 
 
Answers to the End-of-Chapter 1 Assurance of
Learning Exercises
 
Set 1:  Strategic Planning for Coca-Cola
 
EXERCISE 1A
Gather Strategy Information for Coca-Cola Company
 
 
Answer:
Possible external opportunities/threats and internal strengths/weaknesses are listed below for Coca-Cola Company. The factors were derived from the sources suggested for finding information about Hershey, its rival firms, and the confectionery industry. Make sure students see the difference in internal vs. external factors. Remind students to be as specific as possible in stating each factor. Remind students also that key external and internal factors need to be actionable, quantitative, comparative, and divisional to the extent possible. Ask students to keep this information for use in later exercises. 
 
Opportunities
 

1. Soft drink consumption increased by 39% from 2012-2017 in the Asia Pacific region.

2. Soda consumption in Africa is expected to rise 29% between 2015 and 2020.

3. Bottled water consumption increased by 9% in 2016 in the United States.

4. Volume sales of sports drinks in the USA increased 10% from 2012 to 2015.

5. The global energy drink market is the fastest growing beverage market with a projected 3.7% growth from 2017 to 2022.

6. The global juice market is predicted to increase 3.4% between the years 2016 and 2024.

7. Ready to drink tea consumption grew by 3.7% in the USA in the year 2015.

8. Coffee consumption in the USA increased 5% in 2016.

9. The worldwide protein market grew 60% from 2016 to 2017.

10. The global snack food market is expected to be worth $620 billion by 2021, a 5.8% increase.

 
Threats
 

1. USA soft drink consumption per capita decreased from 45.5 gallons in 2010 to 40.7 gallons in 2015.

2. The Healthy Eating Index of Americans has a projected growth of 1.7% to 69.6% of the recommended diet on average that Americans consume.

3. Sugar consumption in the USA has declined 14% since its peak in 1999.

4. Sales of full-calorie soda in the USA declined 25% between 1995 and 2015.

5. In 2016 Americans consumed 400 million more gallons of bottled water than soda.

6. Soda consumption in Mexico fell by 12% between 2014 and 2016 after the implementation of the "junk food" tax.

7. Daily soda consumption among USA teenagers declined 13% between 2007 and 2015.

8. Keurig, the largest coffee company in terms of sales, purchases Dr Pepper Snapple for $18.7 million.

9. Soda sales in Berkley, CA, the first US city to impose sugar taxes, declined by 10% in the first year.

10. The beverage Dr Pepper posted a 1.3% increase in sales in 2016 while Pepsi and Coca-Cola both posted negative sales.

 
Strengths
 

1. 23 of the 34 largest restaurant chains in the USA serve Coca-Cola over Pepsi.

2. Dasani had a 5.3% increase in volume sales in 2016.

3. Monster energy drink sales increased by 50% between 2014 and 2015 and is now the second most consumed energy drink in the USA.

4. Coca-Cola serves the most countries globally at 200.

5. Simply Orange and Minute Maid are 2 of the 5 most consumed orange juices in the USA with $940 million in 2016 sales.

6. PowerAde’s market share has increased by 10% since 2006.

7. Coke’s net Revenue in North America increased by 3.7% between 2015 and 2016.

8. Fairlife milk sales increased 79% in 2016.

9. Sprite had a 3.7% increase in global consumption in 3.7%.

10. Fanta added $100 million in sales growth from 2015 to 2016.