Pestle Analysis: Coca-Cola

Political

• Political Instability

Trade and import policies have been changed rapidly in Pakistan because of the change in government which causes problems in importing raw material. Prices and duties on the syrup which was imported by USA which increase the operational cost a bit.

• Laws & regulations

Changes in taxation requirements entrance of new tax law, Tax rate changes

• Non-alcoholic business era

Pressure of competitive product and pricing policies & ability to increase share of sales market compared to rivals.

Economic

• Market Routes & Distribution Trends

In 2105, company was in a phase of direct distribution to Indirect distribution to improve the service level & to minimize the Operational cost & fixed cost.

• Seasonality

People drink less CBS when it’s cold outside. So, yes weather has a huge impact on the sales of the company

Social

• Brand Image

Coke creates strong feeling and impression on the consumers that whenever people see coke bottle with red label they suddenly start feeling thirsty and feel a need to have a drink & always associate it with happiness

• Consumer attitude & opinion

In a research it was revealed that Coca-Cola is the brand associated with happiness (Coca-Cola, 2010). The result of the survey revealed that people participated in research said it’s the taste that makes them smile others said sharing a bottle of Coca Cola with family and friends can provide any opportunity to spend time together(Coca-Cola,2010)

• Life style Trends

70% baskets contain Coke while doing monthly grocery. It is penetrating more in shopper basket. Majority of people are showing more interest in healthy lifestyle. That has strongly influenced the company to launch Coke Zero, & focus on Diet Coke. But result shows people are consuming regular coke more as compare to coke zero or diet coke

• Religious Factor

Coca-Cola has to face opposition by Muslim activists for being a foreign based company. Another factor was Coca-Cola has alcohol in

No matter what the attitude of coca-colas consumer cannot be changed. It they are consuming coke they will consume coke because research says there is a continual process in the purchase p-pattern of Coke consumers

• Distribution Network

Coca-Cola distribution network is one of the strongest because of the demand of product in the market. Because of this strong distribution network Coca-Cola has been able to achieve such a high market presence.

Weaknesses

• Centralized Decision making

The process of decision making is centralized and employees feel that they don’t have proper authority in the firm

• Product Diversification

Product diversification is low. Whereas, Pepsi is penetrating in market with different products like lays, kurkure, energy drinks like sting. Coca-Cola is missing in that segment. These products could have been profit drives of the company.

• Absence in health Beverages

Now a day’s obesity is one of the major problem faced by people. CSDs are one of major reason of fat intake and Coca Cola is the largest manufacturer of carbonated soft drinks. This things can always turn the table for Coke.

• Motivational Factor

Because of huge communication gap employees lack motivation, they feel that their problem are not being communicated to the top