Political or economic changes can negatively impact its profits. Also, various cities in the US are launching water rationing and water policing initiatives. Despite all the increase in price due to the tariffs, it has reported 8% growth in the net revenue in quarter 3 of the financial year 2019. To conclude, the above Coca Cola PESTLE Analysis highlights the various elements which impact its business performance. Also, water is one of the main ingredients for the company in many liquids and beverages. Out of this, the projected value of the non-alcoholic beverage market is expected to be USD 1488 billion by 2024 as per the anticipated CAGR of 5.5 percent. Allegations were made regardingCoca-Cola using pesticides in its products. Culture, politics, economic situation, and even laws are some factors that affect businesses directly and indirectly. Globally, more than 422 million people in the world have diabetes; around 1.6 million deaths per year have a direct relation with diabetes.
Tax laws vary from country to country. Send Assignment task file through Whatsapp. The company has a innovation driven culture. Besides, given the fact that the world has sustainable development goals to meet by 2030 and there are other international environmental obligations like the Paris Climate Accord, the beverage industry will have to meet stricter environmental compliances to remain flourishing and avoid penalties and actions. to meet the needs of health-conscious customers. Because it is a trusted brand in the US, it will be able to attract customers to its new or refined products in an effective way. The global environment subjects a corporation to severalkinds of pressures and challenges. Also, plans should be developed by Coca-Cola to reduce negative impacts on the environment. Technological efficiency ensures timely production and an efficient supply chain. Coca-Cola should devise a number of strategies to increase its focus on environmental aspects.
The company has also been accused of dehydrating communities due to huge consumption of water, drying up farmers' wells, etc. Abhijeet has been blogging on educational topics and business research since 2016. Apart from it, these laws may varyfrom country to country. 
Changes to these laws can potentially impact Coca Colas profits and revenue. This accounts for more than USD 440 billion (Analytics Insight). Send assignment task file through whatsapp! 2021. The company provides freestyle dispenser which allows consumers to create its own beverage in various combinations through computer like interface. Water scarcity is another major trouble. following are some of the recommendations that have been devised for Coca-Cola to help the company comply with external environment influences and achieve a competitive position in the industry: This PESTLE analysis is based on extensive research and has been articulated by our seasoned and expert academic writers. Such Coca Cola campaigns connect more to the millennials as they actively participate in these through social media and personalization has become their way of living. Following are the legal factors in the Coca Cola PESTLE Analysis: Coca Cola has faced trouble due to quantity of caffeine in its products in different countries in the past. In the present era, social factors are driven by major changes in consumer choices. Coca Cola PESTLE Analysis (Introduction): The non-alcoholic beverages brand Coca-Cola operates globally. Thank you so much ! Given the marketing expertise and the global outreach that the Coca-Cola Company has, smaller brands like Costa see great potential for expansion in being acquired. In India alone,several protests were staged against the company by citizens and non-governmental organizations. Today, the world market has grown highly globalized. Coca Cola external environment analysis through PESTLE tool. Following are the social factors impacting Coca Cola PESTLE Analysis: Coca Cola has always come with some social campaigns to connect to its consumers. At last, despite the impacts of COVID-19, the non-alcoholic beverage industry is expected to grow at 5.5 percent. By 2024, the value of the global beverage market is projected to reach 1961 billion USD. In order to remain profitable, Coca Cola has to invest heavily in it. The legislation states that children should be served healthy drinks like milk and natural fruit juices by default with their restaurant meals rather than sugary drinks, soda, lemonades, and so on. For instance, Climework is a technology that works on the principle of capturing carbon emissions and recycles these emissions. Following the American attacks on Iraq, its revenues were reducedin several countries. . He removed the Coca-Cola bottles and instead recommended people to drink water. For instance, in a recent press conference, Cristiano Ronaldo, the stalwart soccer sensation, removed Coca-Cola from the dais. All of these factors can have a deep impact on business and profits of the global brands.
The brand connected to the consumer on the personal level. Such economic crises impact the customers. The names and other brand information used in the PESTLE Analysis section are properties of their respective companies. It was done on the world kindness day. In the recently concluded G7 summit too, the US has pledged to play a greater role in creating a greener and more sustainable infrastructure. This is evident in the fact that in the US, there is a favorable atmosphere for beverage industries looking to leverage the coffee industry or cold-brewed coffee brands.
The demand of consumers has shifted from sugary drinks to low calorie drinks. Speaking of demographics, millennials make the largest generation group in the United States, with a population of over 72 million (Statista). Quizzes test your expertise in business and Skill tests evaluate your management traits. Moreover, beverage companies in the US also rely on other countries, and hence how diplomatic relationships take a turn under the new government will be crucial to beverage companies. People were encouraged to find bottles with the name they feel connected to and then give it to their family or friends and share the same on the social media media platform with the hashtag share a coke. Any major change in peoples preference and taste can impact the profits of a business. Social factors too are just as important from a business point ofview. The ramifications of the pandemic have impacted daily sales, consumer preferences, and the purchasing capacity of people. 2021. After regaining its lost financial strength, the company may again look to acquire some more brands to expand. The online Coca Cola store also let the customers customize their name on the bottles. It is important to note that as compared to 2019, the net operating revenue of the company in 2020 fell by 4.26 billion USD (Coca-Cola's net operating revenues worldwide 2020 | Statista, 2021). To substantiate, as per the first-quarter results of 2020 shared by the company, the cash flow from operations was USD 556 million hence showing a downward revision by 29 percent. (PR Newswire) Some of the most popular health drinks or brands in the market replacing traditional carbonated drinks are Ample, Daily Harvest, Dirty Lemon, Twinings, Smartwater, and so on. Coca Cola company are also turning to solar energy to make their beverages in Fiji. Anna Stavroudi (author) on January 22, 2012: Hey ! Besides, the company owns around 200 global brands that offer their products in more than 200 nations. As a ripple effect of this, Coca-Colas market value witnessed a downfall by USD 4 billion in no time. All these factors are important for generating revenues. It has used water smart farming methods like RAIN and CARE which uses as less water as possible. Similarly, changes in the political situation of the countries like government changes or any political turmoil can potentially impact itsbusiness. It has initiated other programs too in order to reach the community and empower women. Robb, G., 2021. Sustainability and environmental concerns have grown central to business in the 21st century and even for the companies with near-zero or zero environmental footprint. The company is facing cost pressure due to rise in the tariffs on steel and aluminum. The groundwater in the west is depleting at a pace much faster than anticipated. Such trends can lead to a decline in the popularity of Coca Cola products. Also, the company should boost the supply of its healthy drinks such as diet coke, etc. He graduated with a Hons. MBA Skool is a Knowledge Resource for Management Students, Aspirants & Professionals. (U.S. cold brew coffee market size 2015-2025 | Statista, 2021) So, if Coca-Cola may be interested in acquiring some cold-brewed coffee brands given the potential of this segment to help the company amplify its revenues and take them to the pre-COVID times or even higher. Coca-Cola managed to remain relatively unscathed (the effects were felt the most by the financial companies), still its profits were to some degree affected. Basically, Coca-Cola produces non-alcoholic concentrates, beverage bases, and syrups. Media has also played an important role in changing peoples perception of soda drinks which are mainly seen as loaded with calories. For beverage companies that also penetrated the coffee businesses, it is vital to know that an average American drinks around 3 cups of coffee each day. | Multipure, 2021). Any change in the globalbusiness environment canimpact its profits and revenues directly. Moreover, the beverage industry in the US is working on multidimensional strategies to cut down its carbon footprint. Coca-Cola and its productsmustconform to the relevant laws in the countries theyare sold. The latest state to have passed the bill is the state of Illinois. It has set ambitious sustainability plans for 2020 and is working to achieve these targets. U.S. cold brew coffee market size 2015-2025 | Statista [online] Available at: https://www.statista.com/statistics/659724/cold-brew-coffee-sales-us/ https: 659724 cold-brew-coffee-sales-us statistics www.statista.com [Accessed 16 June 2021]. You can seek assignment writing help from us for HD grades just like thousands of other students do. These papers are intended to be used only for research and reference purpose only), Ex- Management faculty of University of Sydney. The environmental analysis is done in this article with the use of PESTLE analysis with which different environmental factors are discussed, including political factors, economic factors, social factors, technological factors, legal factors, and environmental factors. Cultures importance can also be understood from a marketing perspective. Besides, there are four states in the US that have passed legislation that can affect the beverage industry. For beverage companies, millennials also make their primary target market given the high preference for soft drinks and beverages among them. Statista. Along with an extensive interest in management studies, he is a sports enthusiast who loves to spend time in the basketball court. Also, it is important to note that the US has been the worst-hit country by the pandemic in terms of total cases and covid-related deaths claiming the lives of more than 600,000 people. The FDA specifies that all products in the food and beverage industry, existing or new, must contain a description of nutritional values on the label. Hence, these health guidelines by WHO may impact the soft drinks industry. Over more than 130 years of its operations, the company has diversified its products to target various segments of people in a worthwhile way. The article talks about Coca- Cola, which is a carbonated soft drink company founded in 1886. Let us start the Coca Cola PESTLE Analysis: The political factors in the Coca Cola PESTLE Analysis can be explained as follows: Coca Cola can have a direct impact by the laws and regulation of the government on the food products. Noncompliance can cost billions in fines andcan also result in loss of image. People are increasingly adopting a healthy lifestyle and are avoiding sugary drinks. Mislabeling of one its products as a pomegranate and blueberry juice in spite of apple and grape juice has led it to a serious concern. Globally, junk food and soda beverages have faced a decline in sales. In this highly globalized market, certain factors are of special significance that affect businesses. Furthermore, there are WHO guidelines that call for a reduction in sugar intake and limiting the consumption of sugary drinks. This will also be the most difficult area for Coca-Cola to manage. Simultaneously, Cultural factors are also of significance for Coca-Cola. He likes to blog and share his knowledge and research in business management, marketing, literature and other areas with his readers. Several lawsuits related to quality standards or use of harmful ingredientshave also been filed against itin the past.
However, the market is so booming that it is expected to reach USD 944 million by 2025. With rampant increase in the pace of globalization, the economic scenarios will keep getting better for industries. It invites consumers to play games online and associate with the Coca Cola products. This example also signifies the fact that given diverse consumer needs, the Coca-Cola company is no longer limiting itself to carbonated beverages. Although Coca Cola has adopted various strategies to fulfil its environmental responsibilities, still various actions of Coca Cola have a negative impact on the environment. Companies that fail to meet the government's standards are subject to fines. These issues potentially impact their business and revenue. The bottling companies with which Coca-Cola has collaborated further produce, package, and distribute beverages to consumers worldwide under different brand names. Its impact on the businesses cannot be underestimated. For any assistance that you may need for your assignments on PESTLE analysis or any other subject, you can avail of our premium assignment help services. in English literature from BRABU and an MBA from the Asia-Pacific Institute of Management, New Delhi. That has strongly influenced the sales within the non-alcoholic beverage sector as many customers switch to bottled water and diet colas such as Coca-Cola Light or Zero. To add, 1 in every 10 Americans has diabetes while 1 in every 3 Americans has pre-diabetes. The external environment analysis of Coca-cola can be written by following various steps which include evaluating external factors, collecting data, identifying opportunities, recognizing various threats and preparing the final report. These programs are designed to help the farmers in Africa and Ghana learn new and more efficient methods of farming. (Centers for Disease Control and Prevention). In the first quarter of 2021, the GDP of the United States has shown a 6.4 percent growth. They are of primary concern to the Coca Cola company. Colorado is currently facing its second drought in the last three years hence explaining how grim the situation is in the US when it comes to water inadequacy (States With Water Shortages: Who Is Affected By the US Drought Crisis? Just like smart playing the opposition in basketball, he smartly instills, Copyright 2015 - 2021 Assignmenthelp4me.com 34 Becharry Road, Blacktown NSW 2148, Sydney, Australia.
The place of origin of the multinational company, Atlanta, also serves as its headquarters. The new trade agreement between US, Mexico and Canada is supported by the company for free and fair trade between the nations. 2022 The Arena Media Brands, LLC and respective content providers on this website. The comprehensive PESTLE analysis sheds light on the various factors affecting international businesses in the context of The Coca-Cola Company. bb. Coca-Cola introduced severallow calorie products to adopt to these changes. Coca-Cola PESTLE Analysis (based on external factors), Technological factors impacting Coca-Cola, Environmental factors impacting Coca-Cola, factors affecting international businesses, https://assignmenthelp4me.com/article-coca-cola-external-environment-analysis-450.html. Technology is an important factor for the large businesses like Coca Cola. As per Statista, the market size of cold-brewed coffee in the United States was USD 166 million. Coca-Cola is a globally accredited and recognized US-based international beverage company.
It already has the prerequisite environment and infrastructure needed to diversify its products to enhance its competitiveness. Below is the PEST analysis for the Coca-Cola Company, a global enterprise that has ranked as one of Fortune's top ten most-admired companies for the past consecutive five years. This way, by acquiring Costa that has operational bases in more than 30 nations, Coca-Cola has been able to establish a greater stake in the global coffee market. All claims of nutrient content must be in compliance with the Nutritional Labeling and Education Act. Whether it is the processing of water or the packaging of Coca Cola products, it all requires heavyuse of technology. Thus, technological factors have an important and sizable impacton the business of Coca Cola. To shed light on the companys financial performance, in the year 2020, the companys net operating revenue worldwide stood at 33 billion USD. FuelGems, Climeworks, CarbonCure are some of the latest technological innovations that can play a game-changing role in the reduction of carbon footprint. It posted all of its content with #refreshthefeed. The country spends around 2.9 percent of its GDP on research and development. Hence, the country has a robust technological infrastructure, and given the large expenditure on R&D, the nation is keen on leveraging the scope of futuristic technology to grow its commerce and industries.
The companies are not associated with MBA Skool in any way. The recent tiff between US and China resulting in a trade war has a major impact on the prices of the Coca Cola canned products. Free sugars are abundantly present in carbonated beverages, syrups, and juice concentrate. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. The recent global financial crisis reducedthe profits of businesses significantly. Founded in the year 1892 in Atlanta, Georgia, the Coca-Cola company is an industry leader in carbonated soft drinks. To conclude, given the present scenario and changing lifestyles of people, Coca-Cola should look to add more healthy drinks and nutritional products to its brands. It is why it has especially focused on corporate governance, ethics and compliance. Similarly, states like Utah, Oregon, Texas, New Mexico, and Colorado are prone to water shortages and drought conditions. What happened to T? The food and beverage industry in the US is regulated by various legislations and acts. Compliance has also become an important concern for businesses around the world and especially for those operating in the international environment. 2021. Coca Cola despite being theleading brand in the beverages industry, is notimmune to the various political, social or economic fluctuations. The United States is at the fourth position in the rankings of countries based on technological expertise. Similarly, there are environmental laws, whichaffect the soda giant. The legislation is basically aimed at the idea of mitigating the occurrence of heart diseases and Type 2 diabetes. Any increase or decrease in tax rates can affect the profits of any corporation. It also saves data for market research which will be further used by the company to understand the taste and preference of the consumers. Coca-Cola, also feels the pinch from time to time. It has been reported as the biggest consumer of freshwater in the world. The company has to followthe relevant laws in order to do business in a particular market. Companies are doing business across large regions spanning several countries. By the end of 2026, the market for health drinks will reach USD 700 billion. Currently, as global growth is slowing, Coca-Cola may be watching for a similar opportunity. It is coming with first ever ready to drink frozen beverage in Japan. Our highly qualified academic writers, Ph.D. associates, and other industry experts are committed to helping you round the clock with your academic endeavors and learning. Further, the company sells these syrups and concentrates to its bottling partners spread across the globe.