Assignment 2( S&SM)_ Rashmi Singh PGDM 09

Assignment 2 (9 December 2010) Selling & Sales Management By: Rashmi Singh, PGDM09 (rashmisingh09.asm@acha rya.ac.in) Acharya School of Management, Bangalore Page 1 Changing Sales and Selling Environment of Coca-Cola Inc. The soft drink industry has been the one of the most sustained and growing industry worldwide. Starting from the one product cola it has widespread to several varieties including fruit juices, sports drinks, and bottled water etc. Us is the major market and Asia is the another merging market with the estimated consumption of 5% per annum. Value Chain of Softdrink Industry: Typically a soft drink consists of two elements 1] Production / Manufacturing of soft drink syrups which includes (i) Concentrated Producer (like Coca Cola, PepsiCo) who manufactures the carbonated syrup, handles marketing and advertisement (ii) Bottlers who are responsible for packaging and canning of the products. 2] Distribution: They are mainly constitutes retailer, supplier who makes the final product available to the end consumer. The three broad categories of distributors are modern trade or large chain retailers, the small individual retailers and the indirect channel (wholesalers). Profitability of Softdrink Firms: There are four factors on which the profitability of the Softdrink firm id dependent on (i) Revenue protection & enhancement: This can be enhanced by significant and effective sales growth and cost reduction. (ii) Cost reduction / margin improvement: This can be achieved through EoS (Economics of Scale), when there are large customers with huge and continuous demand for products. (iii) Improved asset utilization: Since manufacturing of softdrinks needs high capital investments for setting up plants, shipping, packaging etc, with large number of orders the factors of production can be utilized. Also there is moderate asset specificity in this industry so, asset utilizations becomes more important earn profit. (iv) Regulatory/ Assurance Sales in Softdrink Industry: There are several factors which affects the sales of softdrinks. These includes supply chain system, marketing, brand identity, seasonality in demand, relationship with

Assignment 2( S&SM)_ Rashmi Singh PGDM 09

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