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THIS SHOULD CLEAR THINGS UP A LITTLE, ADD IN THAT FIRST SET OF WORK WE DID INTO WHERE IT FITS UNDER EXTERNAL ENVIRONMENT: REMOTE ENVIRONMENT

CHEERS MARCUS

The green writitng has been updated by daniella :)
 * Executive Summary**
 * Introduction**


 * __Situation Analysis__**

__**Business Definition and scope**__

__**External Environment: Remote Environment/Macro**__

The overall increase in average weekly household expenditure on goods and services between 2003-04 and 2009-10 was $343 (38%). Over the same period the price of goods and services, as measured by the CPI, rose by 19%. Largest increases in dollar terms in average weekly expenditure for food and non alcoholic beverage (soft drinks) was up $51 (34%).  Australian Bureau of Statistics. //Household Expenditure Survey 2009-10.//  //
 * __**Economic Forces:**__

People aged 16-24 were more likely to drink soft drinks compared to adults aged 25 years and over were more likely to drink tea and coffee. National Nutrition Survey (2006). //National Nutrition Survey: Foods Eaten, Australia.// Australian Bureau Of Statistics. 
 * __**Socio Cultural forces:**__

Currently in Australia, the use of caffeine as a flavouring substance is restricted to cola type drinks where the maximum use level prescribed is 145 mg/L. This contrasts to the situation in NewZealand where caffeine is permitted in a much broader range of soft drinks. Amendment was made to the Food Standards Code to permit the use of caffeine as a flavouring in all soft drinks at a maximum level of 145 mg/kg or 200 mg/kg (as appropriate).
 * __**Political-legal forces:**__

ANZFA-Assesment Report-Caffeine in Water based Non Alcholic Beverages (2001). 

Coca Cola has introduced new blowfill technology in Australia’s bottling facility in Adelaide which is said to gain cost savings, increase production efficiency and assist manufacturing and designing of beverage bottles onsite using less raw materials. //Blowfill Investment sees CCA Slash Australian PET use.//(2011). //http://www.beveragedaily.com/Processing-Packaging/Blowfill-investment-sees-CCA-slash-Australian-PET-use >// Schweppes Australia admits it has suffered due to a lack of CO2 over the past two months, leading to shortages of fizzy drinks in the nation. <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Sara Lettieri stated “As a consequence of this shortage we have not been able to produce the volume of soft drinks that we would normally be producing at this time of year” <span style="color: #008000; font-family: Arial,Helvetica,sans-serif;">B Bukley, S Lettieri (2012). //World is flat for Schweppes, as Aussie soda runs outta gas. <//[|__http://www.beveragedaily.com/Markets/World-is-flat-for-Schweppes-as-Aussie-soda-runs-outta-gas__]>
 * __**Technological forces:**__
 * __**Natural environment forces:**__

__**External environment: Near environment/Micro**__


 * __**Market review**__


 * __**Competitive review**__


 * __**Distribution channels and buyers**__


 * __**End user and customers**__


 * __**Supply**__

__**Critical Success factors**__


 * __**Summary of opportunities**__


 * __**Summary of threats**__

__**Company Internal capabilities**__


 * __ **Marketing capabilities, strategies and performance:** __

//<span style="color: #000000; font-family: Arial,Helvetica,sans-serif;"> Virgin cola: // <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;"><span style="color: #0070c0; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Dearlove (2010). //The Unauthorized Guide to Doing Business the Richard Branson Way: 10 Secrets of the world’s greatest brand builder .//A wiley Company.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">February 2000, Virgin admitted defeat in its war against Coca Cola and Pepsi. Virgin changed the strategy, management and location of its soft drinks business, concentrating on ‘new age’ drinks, including fruit juices and energy beverages.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Virgin Cola’s marketing strategy has been centred on creating value for money, quality, innovation and fun.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">A distinctive skill which yields a competitive advantage and draws much of the success of Virgin Cola is attributed back to the personality of Sir Richard Branson, a public figure with considerable charisma, who offers his personal image in support of Virgins corporate communication.

//<span style="color: #000000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Coca cola: // <span style="color: #0070c0; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Gonski D. Davis T. CCA Annual Report (2010) <span style="color: #0070c0; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">CCA Annual Report (2006) > CCA Annual Report (2006) //<span style="color: #000000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Pepsi: // P. Kotler, G. Armstrong, L. Brown and S. Adam, Marketing, Prentice Hall, Australia, 1998. //Troys Report.// Monash University.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">CCA’s beverage market leadership position continued to strengthen in 2010 with increases in both volume and value share across all channels despite more aggressive competitor pricing in the second half. The business also fully recovered cost of goods sold increases through a combination of pricing and mix management.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Improved pricing and product mix, successful new product launches and the continued realisation of cost savings from CCA’s major infrastructure capital investment program, Project Zero, all contributed to a strong performance in 2010.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">changing the shape and visual image of the coca cola soft drink has been a marketing strategy used. In 2006 introduction of the slim line cans and the 385ml screw top glassbottle helped boost the overall brand and Coca-Cola revenue by 9% in 2006.\
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 16px;">Coca-Cola Zero has been the biggest beverage launch for CCA in 22 years, and an exceptional opportunity for the business to develop a major new segment. In the 12 months since its Australian launch, Coca-Cola Zero has captured 13% of the cola category, with CCA’s total cola market share in food stores growing from 75% to 77%.Coca-Cola Zero is already tracking above 75% of Diet Coke monthly volumes, which is well ahead of expectations.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">In 2006 Pepsi launched a global re-styling of its Pepsi cans, with a series of 35 new designs, with themes such as music, sport or fashion, the new themes made different changes every few weeks. Each one has its own website with video clips and other enticements to engage consumers. The aim is to represent the “fun, optimistic and youthful spirit” of Pepsi, says the firm. Analysts believe changing the packaging is a tired brand’s last refuge.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif;">Pepsi focus their image on the individuals and the introversive people. . A lot of their campaigns in the past are associated with sports, many of which were individual sports. They had promotions that showed men living on the edge and performing dangerous stunts. This is certainly creating different personalities of their products compared to Coca-Cola. However this is how they attracted their target market.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 16px;">Pepsi has a more futuristic look with the theme "the next generation." As their softdrink product category is more associated with sports and doing unusual things, such as stunts and extreme games, they have not worried about creating a slick bottle shape like Coca-Cola, instead they've just made them slightly larger, to offer more to the customer.
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 16px;">Use events such as skateboarding, rollerblading, and many other dangerous individual sports to create awareness, knowledge and liking to the product.


 * __**Non marketing capabilities:**__

//Coca cola:// <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">-Development of premium and market leading brands. <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">-Scale and reach of the sales force. <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">-High tech and high touch of our customer servicing capability. <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">-Highly efficient national manufacturing and physical distribution capability. <span style="color: #0066cc; font-family: Arial,Helvetica,sans-serif; font-size: 16px;">Devon,k. Loane S (2007). //Strategic Review Coca Cola Amital 2007.// Company Announcements Office Australia.
 * __**Marketing capabilities, management:**__
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">In the 2007 strategic review report by Coca Cola Amatil it was stated that its core competencies that it wishes to focus on for future growth is:
 * <span style="color: #008000; font-family: Arial,Helvetica,sans-serif; font-size: 90%;">Coca Cola Amital has also undertaken a major IT infrastructure development to re-engineer business processes and create a world class operating system. This encompassed re-engineering of business processes to facilitate a more efficient transfer of and use of information across the total business and modernising the complete process of order to cash to lower the cost of doing business.

Problems and opportunities statement Recommendations

Ed Thornhill 20100764 13/03/12

Heya!

These are the highlights for the INDUSTRY/ MARKET TRENDS- DRINKS online research articles. Have also emailed this to everyone as it might be easier to compile these in our group meetings on a master form slash template? sound good?


 * Week 2**


 * Drinks**

Little differences in taste and other product attributes. So the Virgin product must be distinguished by marketing a unique competitive strategy.


 * Global Beverages 2011 (Global Beverages, not just soft drinks)**

The global beverages industry had total revenues of $1,749.4 billion in 2010 (pp8)

The global beverages industry is forecasted to experience decelerated revenue and volumes growth during 2010-2015. (pp9)


 * Market Value **

The global beverages industry grew by 15% in 2010 to reach a value of $1,749,350.9 million. The compound annual growth rate of the industry in the period 2006–10 was 1.9%. (pp10)


 * Market Segmentation **

Beer, cider & FABs is the largest segment of the global beverages industry, accounting for 33.5% of the industry's total value. The soft drinks segment accounts for a further 32% of the industry. (pp12) Asia Pacific accounts for 22.9% (pp13)

The Coca-Cola Company is the leading player in the global beverages industry, generating a 16.3% share of the industry's value. PepsiCo, Inc. accounts for a further 9.2% of the industry. (pp14)


 * Competitive Review/ Market Penetration**

Entrance to the industry could prove problematic when the large scale of leading incumbents and brand loyalty is taken into account, however substitutes are cheaper and just as popular with consumers, providing new entrants with an avenue to entrance. All of these factors increase rivalry between players. (pp15)

Brand loyalty is key in this industry (pp18)

There has been increased demand for organic products (pp18)

New entrants need to access distribution channels, such as retailers(pp18)

Manufacturers have sought cost-effective packaging (pp18)


 * Buyers**

Buyers must meet consumer end-user demand, meaning they must stock popular products, which reduces their power somewhat. (pp16)


 * Suppliers **

Materials are highly undifferentiated, meaning that players can choose alternative suppliers when it suits them. Some beverage producers have integrated backwards into producing their own raw (Virgin could save by also producing raw materials required)


 * Rivalry**

The global beverage industry is fragmented with leading incumbents such as Coca-Cola, Pepsi Co, Nestle and Anheuser Busch holding 35.1% of the total industry value. (pp21)


 * Competition **

Pepsi Co PAB owns or leases approximately 20 plants and production processing facilities and approximately 65 warehouses, distribution centers and offices. In addition, the company has an ownership interest in approximately 80 bottling plants. The company's contract manufacturers or co-packers also own or lease approximately 55 plants and production processing facilities and approximately 50 warehouses and distribution centers. (pp27)

The company recorded revenues of $57,838 million in the fiscal year ending December 2010, an increase of 33.8% compared to fiscal 2009. Its net income was $6,320 million in fiscal 2010, compared to a net income of $5,946 million in the preceding year. (pp27)

The Coca-Cola Company The company owns the world's most valuable brand: Coca- Cola. Furthermore, Coca-Cola markets four of the world's top five nonalcoholic sparkling brands, including Diet Coke, Fanta and Sprite. The company's finished beverage products are sold in more than 200 countries worldwide. (p30) The company recorded revenues of $35,119 million in the fiscal year ending December 2010, an increase of 13.3% compared to fiscal 2009. Its net income was $11,809 million in fiscal 2010, compared to a net income of $6,824 million in the preceding year. (p32)

Global Beverages 2011, Datamonitor, 2011, (New York, NY, 2011). pp.1-44


 * Soft Drinks in Australia**


 * Market Value**

The Australian soft drinks market generated total revenues of $11 billion in 2010 Carbonates sales proved the most lucrative for the Australian soft drinks market in 2010, generating total revenues of $6.6 billion, equivalent to 59.9% of the market's overall value. The Australian soft drinks market grew by 3.3% in 2010 to reach a value of $10,953 million. (pp.11-13)

Coca-Cola Company, The is the leading player in the Australian soft drinks market, generating a 39.4% share of the market's volume. (pp.14)

The Australian soft drinks market is fairly concentrated, with the top three players holding 54.9% of the total market volume. Supermarkets/hypermarkets form the most significant distribution channel in the Australian market. The presence of big supermarket chains increases buyer power. New entrants must contend with the reach and strong brands of the incumbents.(pp.15)

The rivalry level is moderate and there is scope for growth in niche categories. (pp.16)


 * Buyer Power **

In Australia, the main distribution channels for the soft drinks market are supermarkets/hypermarkets, which account for 48.5% of the total market volume, followed closely by on-trade retailers (32.5%). The leading players generate most of their revenue from the production of concentrates, which are sold to bottling companies.

Consumers in this market are likely to be strongly influenced by brand, and this weakens buyer power as retailers are forced to stock brands popular among consumers.(pp.17)


 * Supplier Power **

Primary inputs for soft drinks manufacturers include concentrates, a range of natural and synthetic sweeteners such as corn syrup and refined sugar (sucrose), aspartame, and similar ingredients. (Variety of products sourced and alternatives offered if one becomes expensive or unobtainable).

The fast developing Australian market, following the worldwide trend, is switching into low sugar and sodium products, imposing the certain production methods to be used. (pp.18)


 * New entrants **

Players in the Australian soft drinks market try to distinguish their products to some extent by stressing their health benefits & taste It may be possible to achieve small-scale success stressing a unique production method or nutritional benefits. (pp.19)


 * LEADING COMPANIES **


 * The Coca-Cola Company **

Most of TCCC's products are manufactured and sold by bottling partners, who convert them into finished packaged products for sale to distributors and other customers. The company sells the concentrates and syrups for bottled and canned beverages to authorized bottling and canning operations. (p.22)


 * PepsiCo, Inc. **


 * MARKET DISTRIBUTION **

Supermarkets / hypermarkets form the leading distribution channel in the Australian soft drinks market, accounting for a 48.5% share of the total market's volume. (pp.37)

Soft Drinks In Australia 2011, Datamonitor, 2011, (New York, NY, 2011). pp.1-46


 * Australia - Carbonated Soft Drinks **

Off-trade accounts for the largest share of distribution in the Australian Carbonated Soft Drinks market, with 56.2% of the market in volume terms. (pp.11- fact from 2001)
 * Distribution **

Australia – Carbonated Soft Drinks 2001, Datamonitor, 2001, (New York, NY, 2001). pp.1-12.


 * Australia – Soft Drinks 2003 **

NOTHING OF USE IN THIS ARTICLE… I think- repetitive/ old stats


 * FoodMap: A comparative analysis of Australian food distribution channels 2007 **


 * Cold beverages **

A significant distribution channel for all ranges of drinks into outlets, such as independent food stores, convenience stores, and takeaway outlets, is by direct supply or “route distribution” by the major branded drinks companies themselves. These include sales of “impulse products”, which are of small drink package size designed to appeal to the “drink on the go” consumer market. Key features of channels to market Major FSS dominate, but a significant volume of product moves into specialty retail and foodservice marketed as “impulse beverage” Consolidation of ownership of drinks businesses as carbonated beverage groups seek to diversify away from heavy reliance on soft drink Dominant drivers of value FSS price promotion of chilled bulk drinks lines Impulse product positioning based on convenience price points Major trends and dynamics Decline/stagnation in sales of carbonated beverages through health concerns Increase in demand for water and healthier juice products Health concerns changing buying preferences of institutions, including schools (pp.54)


 * NOTE- Chilled Beverage Distribution **

The common denominators in these categories are lower numbers of participants, informed markets, greater diversity and stronger brands. These conditions have led to higher levels of innovation, a higher primary product yield and as a direct consequence, greater value capture (pp.27)


 * Grocery retail_ Distribution Channels **

Overview The FSS retail channel dominates sales of most food and beverages categories. Major chain retailers have large national store networks covering all inner city, suburban and regional centres. Smaller chains or independent banner groups have less comprehensive coverage of the market. A key feature of the channel structure is the means by which retailers manage direct supply logistics on national or regional bases, through national (NDC) and regional distribution centres (RDC). The type of products supplied through these centres will depend on the nature of the products, and their availability or dependence on regional supply sources. RDCs will tend to be used for fresh product lines, whereas an NDC is more likely to supply dry groceries, for example. In some cases supplier or franchised direct-store delivery services will service parts of the retailer networks, especially those in regional centres. (pp.57)


 * Innovation in product form **

The opportunity for suppliers is to offer greater convenience to consumers by working with retailer customers to: improve tailoring of ready-made components and ingredients deliver storage and packaging innovation that aids convenience and product versatility adopt technologies and layout configurations to improve the shopper flow through convenience checkouts at peak buying times. (pp.85)

Spencer, S & Kneebone, M 2007, FoodMap: A comparative analysis of Australian food distribution channels, Australian Government Department of Agriculture, Fisheries and Forestry, Canberra. (pp.1-95)

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