Business Environment Analysis of Coca-Cola: A Comprehensive Report

This report provides a comprehensive analysis of Coca-Cola's business environment. It begins with an introduction to the business environment, emphasizing the interplay of internal and external factors. The report then delves into the relationship between various business functions (HR, R&D, Sales & Marketing, and Finance) and the company's objectives and organizational structure, including function-based, geographical-based, product-based, and customer-based structures. A significant portion of the report is dedicated to the positive and negative impacts of the macro environment on Coca-Cola, utilizing the PESTLE analysis (Political, Economic, Social, Technological, Environmental, and Legal factors). The report further examines Coca-Cola's internal and external factors through a SWOT analysis, identifying strengths, weaknesses, opportunities, and threats. The interrelation between strengths, weaknesses, and external macro factors are also discussed. The report concludes by summarizing the key findings and insights into Coca-Cola's strategic positioning and operational challenges within the global beverage market. The report is a valuable resource for students seeking to understand the complexities of business environment analysis and strategic management in a real-world context.

BUSINESS
ENVIORNMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1(Covered in ppt.) ................................................................................................................1
TASK 2............................................................................................................................................1
P3 Relationship between various functions of an enterprise and its link with objectives and
structure of firm...........................................................................................................................1
TASK 3............................................................................................................................................3
P4. Positive and negative impact of macro environment upon business organisation................3
TASK 4............................................................................................................................................4
P5 Studying on Internal and External Analysis..........................................................................4
P6 Interrelation of Strength and weakness with external Macro factors....................................6
CONCLUSION................................................................................................................................7
REFERENCES ...............................................................................................................................8

INTRODUCTION
Business environment is a combination of internal and external factors which affect whole
activities of the company. In this, internal factors are controllable by the firm but on the other
side, external factors are not controllable. Thus, it is vital for manager to the company to
effectively consider all the aspect and factors before preparing any strategies. Along with this,
technologies, government policies, ethics of the firm and many more are main factors which
highly affect the operational activities in positive and negative manner. In this manager also play
vital role in managing as well as evaluating all the factors with the purpose of reducing the
negative impact on company activities (Zsambok and Klein, 2014). With the help of this,
company easily enhance their profitability level at market place and at the same time also
established their positive image. For attaining better success, company needs to produce quality
services as per market and customers needs which may leads in creating customers base within
the company. Present report is based on Coca Cola, is famous and biggest beverage company as
they operate their business in various countries with the purpose of attaining better success.
Different type of companies with their purpose if mentioned in this project. In addition of this,
size, scope, and its legal structure is also mentioned. At the last of the project, positive and
negative impact of macro and micro environment is also discussed here.
TASK 1(Covered in ppt.)
TASK 2
P3 Relationship between various functions of an enterprise and its link with objectives and
structure of firm
Every company run their business with a motive of gaining maximum benefits from the
products they are manufacturing or selling. Company try to sell products that are excellent in
quality and this enable them in establishing a positive brand image in front of its customers. As
Coca-Cola is a renowned company and operates its business globally and by this they are
fulfilling their motive of getting higher success in market area (Meiners, Ringleb and Edwards,
2014). Business environment must be considered by the manager of Coca-Cola so that they can
hit their desired targets right on time. Thus, it is assisting company in gaining a better position at
market area and gives an opportunity to improve its overall performance. Along with this,
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different departments also play an prominent role in managing all the activates in an effective
manner and these are explained below:
Human resource department: In every company human resource department plays an
important and crucial role by fulfilling basic requirements of an organization. Their prime role is
to select eligible candidates who are suitable for the job. Furthermore, for improving their skills
and knowledge they provide training programs for both existing and new employees. Managers
also on the basis of talents assign task so that it can be accomplished in speculated time frame
and in an appropriate manner as well.
Research and development: This is determined as an essential department which
undertakes activities of identifying the needs and wants of customers (Zeng, Li and Duan, 2012).
This assist company in manufacturing goods according to the choices and preferences of
customers. Thus, in context with Coca-Cola it is helping them in providing better services to its
consumers and as a result they are gaining competitive advancement. Therefore, prime role of
research and development so to go through the recent trends that are available in the market area
and for this, managers of firm formulate questionnaire and it is assisting them in getting relevant
information.
Sales and marketing: Sales and marketing goes hand in hand as for increasing its sales
company incorporated different marketing strategies (Sekaran and Bougie 2016). In case of
Coca-Cola they are using latest tools and technologies which are helping them in manufacturing
goods in speculated time frame. As a result, it is helping them in enhancing sales and
profitability at a same time.
Finance: Finance is important if company wants to execute their business activities in a
proper manner. Thus, in case of Coca-Cola, they are not having such kind of problem as they
have adequate amount of money for making any kind of modification or establishing a fresh
product. Along with this, is a firm have ample amount of money it will help them in purchasing
raw material of best quality at a reasonable cost.
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Organizational structure: Function based: Every company execute their plans so as to achieve the set goals and
objectives in a specific time frame. Thus, every department in an organisation have their
specific function which they perform for attaining desired targets (Crane and Matten, 2016).
This involves sectors like human resource, marketing, production etc.
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 Geographical based: As Coca-Cola is offering its services in many place or can be said
across globe and this is playing as a beneficial element for them because it has expanded
customer’s base for organization (Saleem, 2017). Along with this, it is helping them in
focusing and manufacturing goods according to the needs and wants of specific targeted
people or area. Product based: Coca-Cola has set their segments through which they can enhance their
sales and profitability. Hence, it is assisting company in achieving satisfaction level of
customers.
 Customer based: Under this category company majorly focuses on manufacturing goods
as per the needs and wants of consumers (Gharajedaghi, 2011). For this, Coca- Cola is
taking feedbacks and reviews in order to know if firm needs any kind of changes in their
product and commodities manufactured by them.
TASK 3
P4. Positive and negative impact of macro environment upon business organisation
Macro environment includes that the factors that are beyond control of an organization and it
has a great impact on business operations (Tayur, Ganeshan and Magazine, 2012). In case of
Coca-Cola it is hampering performance of their company in some or the other manner.
Therefore, to understand it in a better manner PESTLE analysis is explained below: Political Factors: This includes all rules and regulations or taxed impose by regulatory
bodies of a country. Or running a business in an effective manner it is important that
company follow all the rules so that they doesn’t face any kind of problem in future
proceedings. Government formulate these laws for the betterment of the company and
employees as well as. As United Kingdom has stable government thus, they are not
facing any kid of issues and Coca-Cola is operating its business effectively. Along with
this all the polices must be taken care by the firm so as to increase sales and profit Economic Factors: This factor has a direct and indirect impact on business as sudden
change in economic policies can bother companies in making some alterations in their
strategies. Therefore, it is important that effective plan of action is made by Coca-Cola so
as to overcome the economic problems if they face (Business environment. 2018)..
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Along with this, change in currency rates can also have a great impact on business
strategies. Social Factors: this is a crucial factor because here is the place where company will
establish its business for gaining maximum benefits (Türetken and et. al., 2011). In case
of Coca-Cola they are analyzing and monitoring the external environment on a regular
basis so as to have ideas about current trends which is going in market area. Coca-Cola
not only manufactures goods for young people but focuses and considers all age group
and manufacture goods accordingly. Thus, it is necessary that company goes with the
current market scenario in order to sustain a better position for a longer period of time. Technology Factors: Now a days, in context of humans or company technology has
plays a crucial role in making their live easier. As they have made firm capable of
implementing innovative ideas in their business operations. This has gradually enhances
their sales and profitability. Thus, in case of Coca-Cola, they have incorporated all the
latest machineries for producing quality products that can be delivered to end customers. Environmental: In this current market scenario, company are manufacturing goods by
considering the environmental factor so that they doesn’t harm atmosphere much. In case
of Coca-Cola, they are manufacturing goods which are eco-friendly (López-Gamero,
Molina-Azorín and Claver-Cortés, 2011). Along with this, they are also determining climatic
condition for employees and establishing its business.
 Legal: For running a business there are certain ethical and legal documents or rules that
company must follow. Thus, Coca-Cola is going through all the norms and laws before
launching any new products.
TASK 4
P5 Studying on Internal and External Analysis
Coca-Cola is one of a leading firm in UK. This firm gives a tough fight to its competitors
like Pepsi and gains a lot of attention of customers due to good taste of products. It offers a wide
range of confectionery products and beverages (Vaiman, Sigurjonsson and Davidsson, 2011).
Therefore, in order to analyse its position in marketplace, it is essential for management of this
company to conduct SWOT analysis. It will help in examining internal strengths and weaknesses
as well as external threats and opportunities. Through this process, it can make modification in
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business structure and grabs more attention of customers. Therefore, SWOT analysis of Coca
Cola can be described as:
Strengths Weaknesses
This part shows internal capabilities of a
firm like which part of its attract minds of
customers. Therefore, it has taken as ideal
performing domain which further becomes a
root cause for giving tough competition at
marketplace. In context with Coca-Cola, this
firm has gained highly reputation and famous
for its amazing taste of drinks. Brand
recognition and equity also shows its major
strengths through which it shows a large
difference from other competitors. In terms of
revenue, per year it has gained near about 79.2
billion. It has sold products in more than 200
countries through which it has earned
profitability in a rapid manner.
Emergence of healthy drinks by companies like
Starbucks, Tropicana, Real Fruit Juice, shows
weaknesses of Coca-Cola that its products
causes obesity rather than giving positive
effects on health (Li and et. al., 2011). Along
with this, absence of product diversification
also affects negatively on sales performance.
P6 Interrelation of Strength and weakness with external Macro factors
As Coca Cola is famous and popular business organization which serve their drinks and
beverages to various countries with the purpose of attaining better success at market place . along
with this, they also having some specific strength and weakness which my help them in
determining their actual performance (Chetwood and et. Al, 2014). In addition of this there are
some external factors is also present in business environment which define their positive and
negative impact. Thus, it is vital for firm to evaluate the entire activities of the company. As
company having positive image and also serve their quality drinks in various countries so that
they have to evaluate their overall performance level of the company at market place.
furthermore, firm also having their market share in beverage industry as it helps them in creating
customers base. On the other side, the negative impact of this is that they are not serve
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diversified products and various sector due to this performance of the company reduce their
profitability kevel at market place (Kian Chong, Shafaghi and Leing Tan, 2011).
In addition of this, company also needs to include customers needs and wants in various
location as it helps in making their brand image higher. This is considered as a strength of the
company. As Coca Cola also includes all the government rules and regulations to effectively
promote their products and services in market place with the purpose of capturing larger market
share form its rivals. It is strength of the company as they easily attain higher success at market
place.
Therefore, as positive brand of the company contributes in new and innovative product by using
new and advanced technologies within their operational activities to make their product unique
and healthy (Yu and Ramanathan, 2013). This will aid in capturing customers attention in order
to retain them for longer period of time. In assistance of this, it also recommended that company
should consider all the factors of political and economic at the time of operating their business in
another countries. With the help of this they easily understand all the negative factors within the
organization. As popular brand equity of Coca Cola positive contributes in enhancing the overall
growth level of the economy.
Opportunities: By offering diversified products like fruit juices and carbonate free drinks
give an opportunity to Coca-Cola to expand its portfolio (Wack, 2017). In addition to this, to win
heart of people, this firm needs to offer snack and healthy drinks which improves its sales
performance in a vast manner. Creating modification in production, adopting latest technologies
and techniques to marketing products also help in attracting minds of customers.
Threats: Due to awareness of people about their health, they used to avoid soft drinks or
confectionery products which contains much amount of sugar and carbonates (Gilboy, 2016).
They prefer fruit juices, coffee products more rather than such commodities. Therefore, it causes
a major threat for Coca-Cola and impacts greatly on its sales performance. In addition to this,
increasing rate of cafes like Starbucks, Costa Coffee and more also influence business of this
company in negative manner. Another threats for this company are scarcity of water, climatic
change and more.
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CONCLUSION
From the above-mentioned report, it can be concluded that business environment is consider
as an important concept which include both internal and external factors that directly affect the
entire activities of the company. Thus, it is vital for manager to effectively analyse all the factors
to maintain their overall performance level of the company at market place by reducing he
negative impact. Along with this, it also helps in improving the performance level of the
company because both factors are also contributing within the firm. It also provides better
support to manager at the time of taking decision as manager have to consider all the elements
within their activities so that they easily make appropriate strategies in systematic way. This will
directly contribute in attaining better success at market place. Furthermore, various
organizational functions are also liked with organizational structure to established positive brand
image by accomplishing set goals and objectives. By this firm easily attain competitive
advantage at market place by taking strong place form its competitors.
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REFERENCES
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Online
Business environment. 2018. [Online]. Available through:
<http://www.investorwords.com/19252/business_environment.html>.
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