EXTERNAL AUDIT

Opportunities

1. Acquisition of Energy Brands, a vitamin water company.

2. Acquisition of Coca-cola Bottlers Philippines.
3. Acquisition of mineral water and related companies in the European
Union.
4. Acquisition of water, juice and sports drink companies in the Latin
America.
5. Expansion of beverage portfolio in Russia thru acquistion.
6. Purchased of beverage company in China which is a huge market.
7. Growing population in North America with substantial buying power.

Threats

1. Trend toward healthy eating and drinking.

2. Declining sales in India and the Philippines.
3. Intense competition in the softdrink industry.
4. Emergence of other beverages and health drinks.
5. Rising cost of raw materials.
6. The limitation of water in some parts of the world.
7. Perceived effect of softdrink to obesity issue.
INTERNAL AUDIT

Strengths

1. World's largest beverage company.

2. Diversified products: 400 brands consisting over 2,600 products.
3. Good brand recall brought by awards and recognition.
4. Wide and intense distribution channels.
5. Aggresive investment porfolio.
6. State of the art production facilities.
7. Effective marketing concepts with strong connection to the youth.

Weaknesses

1. Varied products result to internal competition among divisions.

2. Declining sales revenue in some of its operating areas.
3. Inavailability of some products in other operating groups.
4. Increasing production costs due rising prices of raw materials.
5. Oversized organization in some areas causes to drop operating
revenues.
6. Some coke ingredients are perceived hazardous to one's health.
7. Reliance mostly of its revenues from outside US is affected by low
dollar value.
EXTERNAL FACTOR EVALUATION (EFE) MATRIX

Weighted
Critical Success Factors Weight Rating Score
Opportunities
Acquisition of Energy Brands, a
vitamin water company. 0.05 3 0.15
Acquisition of Coca-cola Bottlers
Philippines. 0.05 2 0.10
Acquisition of mineral water and
related companies in the European
Union. 0.10 2 0.20
Acquisition of water, juice and
sports drink companies in the Latin
America. 0.10 2 0.20
Expansion of beverage portfolio in
Russia thru acquistion. 0.10 2 0.20
Purchased of beverage company in
China which is a huge market. 0.10 4 0.40
Growing population in North
America with substantial buying
power. 0.05 2 0.10
Threats
Trend toward healthy eating and
drinking. 0.05 3 0.15
Declining sales in India and the
Philippines. 0.05 2 0.10
Intense competition in the softdrink
industry. 0.10 2 0.20
Emergence of other beverages and
health drinks. 0.10 3 0.30
Rising cost of raw materials. 0.05 2 0.10
The limitation of water in some
parts of the world. 0.05 2 0.10
Perceived effect of softdrink to
obesity issue. 0.05 3 0.15
TOTAL 1.00 2.45
COMPETITIVE PROFILE MATRIX (CPM)

Coca-Cola
Company PepsiCo Cadbury Schweppes

Critical Weighted Weighted Weighted

Success Factors Weight Rating Score Rating Score Rating Score

Market Share 0.30 3 0.90 3 0.90 2 0.60

Price
Competitiveness 0.10 3 0.30 3 0.30 2 0.20
Financial Position 0.20 3 0.60 3 0.60 2 0.40
Product Quality 0.20 3 0.60 2 0.40 3 0.60
Consumer Loyalty 0.20 2 0.40 2 0.40 1 0.20

Total 1.00 2.80 2.60 2.00

INTERNAL FACTOR EVALUATION (IFE) MATRIX

Weighted
Critical Success Factors Weight Rating Score
Strengths
World's largest beverage
company. 0.10 4 0.40
Diversified products: 400 brands
consisting over 2,600 products. 0.10 3 0.30
Good brand recall brought by
awards and recognition. 0.10 4 0.40
Wide and intense distribution
channels. 0.05 3 0.15
Aggresive investment porfolio. 0.10 3 0.30
State of the art production
facilities. 0.05 3 0.15
Effective marketing concepts with
strong connection to the youth. 0.10 4 0.40
Weaknesses
Varied products result to internal
competition among divisions. 0.05 2 0.10
Declining sales revenue in some
of its operating areas. 0.05 2 0.10
Inavailability of some products in
other operating groups. 0.05 2 0.10
Increasing production costs due
rising prices of raw materials. 0.10 2 0.20
Oversized organization in some
areas causes to drop operating
revenues. 0.05 2 0.10
Some coke ingredients are
perceived hazardous to one's
health. 0.05 1 0.05
Reliance mostly of its revenues
from outside US is affected by
low dollar value. 0.05 1 0.05
TOTAL 1.00 2.80
THREATS-OPPORTUNITIES-WEAKNESSES-STRENGTHS (TOWS)
STRATEGIC POSITION AND ACTION EVALUATION (SPACE) MATRIX
GRAND STRATEGY MATRIX
INTERNAL-EXTERNAL (IE) MATRIX
MATRIX ANALYSIS AND TOWS SUMMARY

Alternative Strategies IE SPACE GRAND COUNT

Forward Integration X X 2
Backward Integration X X 2
Horizontal Integration X X 2
Market Penetration X X X 3
Market Development X X 2
Product Development X X X 3
Concentric Diversification - X X 2
Conglomerate Diversification - X 1
Horizontal Diversification - X 1
Joint Venture - 0
Retrenchment 0
Divestiture 0
Liquidation 0
SO Take advantage existing image in promoting new product lines.
Benchmark succesful products to model less performing one.
Associate new products with company image for easier market introduction.
Apply successful approach to other areas.
Pioneer in areas not yet penetrated by competitors.
Maintain quality production system in all areas.
Strengthen market ties with the youth market.

WO Consider product-market match to avoid internal product competition.

Utilize acquired assets to improve sales revenue in some areas.
Maximize distrubution of products to areas where they are available.
Seek alternative sources of raw materials to maintain competitive costs and
revenue.
Redesign organization structures in areas where they are deemed oversized.
Take advantage of markets where no negative impression is existing.
Consider the growing population of North America to increase sales and not relying
much on outside US market.

ST Promote customer education on the positive value of the product.

Maximize promotion of the different products so as to saturate the market.
Take advantage of the brand to overshadow competitors.
Utilize the distribution existing channels to compete with other beverages.
Establish responsive investment vis a vis rising cost of raw materials.
Maintain quality facility to ensure sustainable water supply.
Strengthen market promotions to negate adverse effect of softdrinks to health.

WT Conceptualize appropriate market segmentation vis a vis the varied products.

Improve sales thru effective cost utilization and effective market performance.
Take advantage of the availablity of products in areas where there is less
competition.
Consider alternative products in response to increasing in the production.
Redesign organizationb structure in oversized areas vis a vis effective cost
utilization.
Source out alternative water sources, while improving negative perceptions of
having hazardous ingredients.
Improve US and North American market, while at the same time negate the
perceived cause of softdrinks to obesity.
QUATITATIVE STRATEGIC PLANNING MATRIX (QSPM)

Strategic Alternatives
Market Product
Critical Success Factors Weight Penetration Development
Strengths AS TAS AS TAS
World's largest beverage company. 0.10 4.00 0.40 4.00 0.40
Diversified products: 400 brands consisting over
2,600 products. 0.10 3.00 0.30 3.00 0.30
Good brand recall brought by awards and
recognition. 0.10 3.00 0.30 4.00 0.40
Wide and intense distribution channels. 0.05 ---- ---- 3.00 0.15
Aggresive investment porfolio. 0.10 3.00 0.30 ---- ----
State of the art production facilities. 0.05 3.00 0.15 3.00 0.15
Effective marketing concepts with strong
connection to the youth. 0.10 2.00 0.20 3.00 0.30
Weaknesses
Varied products result to internal competition
among divisions. 0.05 2.00 0.10 2.00 0.10
Declining sales revenue in some of its operating
areas. 0.05 2.00 0.10 2.00 0.10
Inavailability of some products in other
operating groups. 0.05 3.00 0.15 3.00 0.15
Increasing production costs due rising prices of
raw materials. 0.10 4.00 0.40 3.00 0.30
Oversized organization in some areas causes to
drop operating revenues. 0.05 3.00 0.15 2.00 0.10
Some coke ingredients are perceived hazardous
to one's health. 0.05 2.00 0.10 3.00 0.15
Reliance mostly of its revenues from outside US
is affected by low dollar value. 0.05 1.00 0.05 1.00 0.05
SUBTOTAL 1.00 2.70 2.65
 Market Product
Critical Success Factors Weight Penetration Development
Opportunities AS TAS AS TAS
Acquisition of Energy Brands, a vitamin water
company. 0.05 4.00 0.20 3.00 0.15
Acquisition of Coca-cola Bottlers Philippines. 0.05 2.00 0.10 2.00 0.10
Acquisition of mineral water and related
companies in the European Union. 0.10 3.00 0.30 3.00 0.30
Acquisition of water, juice and sports drink
companies in the Latin America. 0.10 3.00 0.30 3.00 0.30
Expansion of beverage portfolio in Russia thru
acquistion. 0.10 2.00 0.20 2.00 0.20
Purchased of beverage company in China which
is a huge market. 0.10 3.00 0.30 3.00 0.30
Growing population in North America with
substantial buying power. 0.05 3.00 0.15 2.00 0.10
Threats
Trend toward healthy eating and drinking. 0.05 3.00 0.15 4.00 0.20
Declining sales in India and the Philippines. 0.05 3.00 0.15 3.00 0.15
Intense competition in the softdrink industry. 0.10 3.00 0.30 3.00 0.30
Emergence of other beverages and health drinks. 0.10 4.00 0.40 3.00 0.30
Rising cost of raw materials. 0.05 3.00 0.15 2.00 0.10
The limitation of water in some parts of the
world. 0.05 2.00 0.10 3.00 0.15
Perceived effect of softdrink to obesity issue. 0.05 2.00 0.10 3.00 0.15
SUBTOTAL 1.00 2.90 2.80
SUM TOTAL ATTRACTIVENESS SCORE 5.60 5.45