Problem:Coca-Cola has alway had a few ongoing problems to deal with, but the pandemic has made some of these way more prominent. The first area is tied into our weakness of product diversification. Almost half of all Coca-Cola’s business is from away-from-home sales. This means the majority of their sales came from restaurants, sports arenas and vending machines. With most public places still at limited capacity or closed, Coca-Cola’s quarterly sales had the biggest drop in over 3 decades. Although some of their healthier drink options were able to pick up a little of the slack, Coca-Cola is still hurting more than some of their competitors because they never entered the snack industry which is profiting off people staying inside. Public mandated shelter-in-place legislations are not the only issue slowing Coca-Cola sales. With a direct correlation between Covid complications and health issues, more and more people and countries are looking at soda as something that should not be consumed regularly. Coca-Cola’s other problem is based around their health concerns weakness. Latin America is one of Coca-Cola’s biggest markets, so it is bad news that some latin countries are starting to pass new laws to combat obesity. In 2016 Chile passed very strict laws on how and where junk food could be advertised to kids. As a result sugary drink sales dropped over 20 percent. With a new motivation to become healthier to stop Covid deaths; Mexico has passed a junk food label law. This would require health warnings on all products high in sugar, sodium or saturated fat. This is a major problem because Mexico drinks more Coke per person than any other country. Even with many countries trying to get Mexico to postpone the law, it is still set to go into effect this year. These new health laws passed by countries could have a devastating effect on Coca-Cola’s global sales.
Give Some Suggestions
- two plausible strategic options
- Strategy 1 (describe the strategy and explain why)
- Strategy alternative 2 (describe the strategy and explain why)