Coke vs. Pepsi

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Coke vs. Pepsi The company known as Coca-Cola today was started in September of 1919, but the first Coke brand was served as early as 1886. Since that time it has grown to be one of the most globally recognized brand names with a stock value of $167 billion. Coke’s plan has always been developed with the future in mind. Right away the company realized that it was more profitable to manufacture the concentrate used to make carbonated drinks than to bottle it. From that point on they saw the entire world, not simply the originating country, as their desired market. It seems only practical that the company should pursue this agenda until conquered then focus the effort on expanding into different product lines. This logical idea has catapulted them into the much sought after position of number one. Manufacturing the concentrate requires only a limited capital and a minimal reinvestment, but yields huge profits. The company focuses their efforts on capturing more buyers for the most profitable product while distancing itself from the less profitable operations. In order to do this; Coke must have a loyal relationship with its bottlers in order to insure the completion and delivery of its product. They have found that maintaining a close association, as well as partial ownership in the less profitable business encourages both businesses to work together because they depend on one another. More importantly, it gives Coke the cash needed to chase after customers because they operate only in the highly profiting part of operations. Pepsi operates its beverage business quite differently than Coke. Coke sells concentrate to independent bottlers while Pepsi owns its bottling and concentrate operations. This makes Peps... ... middle of paper ... ...spin-off from its restaurants, in addition to the probable spin-off from bottlers and expansion of high profit concentrate and snack food systems into overseas markets, PepsiCo will soon be able to operate like Coca-Cola. In the meantime, Coca-Cola has a superior strategic plan that produces profits that produce plenty of money to expand, buy back stock, and meet financial obligations. Bibliography: Works Cited Knestout, Brian. “The Mighty Coke is Getting Beaten Up.” Kiplinger’s Personal Financial Magazine. Dec. 1998. Sellers, Patrica. “Is Bigger Better.” Fortune. 28 Oct. 1996. Sellers, Patrica and Erin Davies. “Why Pepsi Needs to be More Like Coke.” Fortune. 3 March 1997. Steinriede, Kent. “Fountain War Heats Up” Beverage Industry. Oct 1998. “Letter from the Chairman of PepsiCo. Inc.” 1998.

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