Coke’s back and still has secret in India

1. WELCOME TO OUR
PRESENTATION CEREMONY
Coke’s Back
and
Still Has Secret
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GOOD EVENING EVERYONE

2. GROUP NAME
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3. Welcome to your presentation
Case study on Coke’s Back and Still Has Secret
Prepare For:
Dr.Ahsanul Islam
Associate Professor
& Director
MMBA Program
SMUCT
Prepare By:
Group Leader of INFINITY
Md.Belal Uddin
3rd Semester
8thBatch
MBA in PFM
Shanto-Mariam University of creative Technology
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4. Introduction
Coca-Cola is the leading and world renowned carbonated soft
drink selling brand which introduced on 1886 by pharmacist
Dr. John S Pemberton in Atlanta, Georgia & the company
founded on 1892. Now which is the world's leading
manufacturer, marketer and distributor of non-alcoholic
beverage concentrates and syrups, and produces more than
500 brands with operations in more than 200 countries and
also honored as best global brand based on a study of
InterBrand,2012 and #4 World’s Most Valuable Brands on
Forbes (as of May,2014) which Market values near about
$168.7 Billion. And their famous 7X formula isn’t unveiled till
today. Coke is the registered trademark of The Coca-Cola
Company in the United States since March 27, 1944. Now a
days, Coke become a most popular drink all over the world.
But their journey isn’t so easeful all the time. Especially they
have passed the toughest situation on Indian Market.
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5. SCENARIO OF INDIAN MARKET:
 India is a large market for Coca-Cola, Almost 100
years; the 7X formula for making coca cola has been
closely guarded secret. The Government of India
ordered to coca cola disclose it or cease operation in
that country & they would have to transfer 60
percent of this equity share to India hand over it’s
know how by April 1978, or shut down their business
in India’s market. Coca-Cola had finished their
business and after sixteen years later Coca-Cola had
returned the market without having to divulge its
formula.
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6. DESCRIPTION
The life story of Coca – Cola in Indian Market has some
particular Stages. It described as bellows…….
Firstly Arrived in Indian Market
Coca-Cola sets up its first bottling plant in New Delhi
for 45 days in 1952, The brand has a booth at the
International Fair in Bombay. After that, The Company
officially entered Indian Market at 1956, when
Jawaharlal Nehru led Congress on power. Since India
had not any foreign exchange act; Coca-Cola made huge
money operating under 100% foreign equity.
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7. Problem Arises to Withdraw
Indian Foreign Exchange Regulation Act (FERA) which the Janta Party –
committed to a policy of Indian self-reliance – introduced to govern the operations
of foreign companies in India. It was implemented in the year 1974 during Indra
Gandhi time. The foreign exchange act stated that foreign companies selling
consumer goods must invest 40% of its equity stake in India in its Indian associates.
Coca-Cola agreed with investing 40% foreign equity but stated that they would still
hold full power in technical and administrative units with no local participation
allowed. Because of their confidential 7X formula don’t be disclosed. This demand
was against the foreign exchange act. The government instructed Coca-Cola to
either write up a new plan or to leave the country. In 1976 Indira Gandhi called for
elections and all of the other political parties formed one party in her opposition.
They called themselves the Janta Party (Public Party). The Janata Party came into
the power in 1977 and stressed that Coca-Cola should either accept the foreign
exchange act or leave the country. Coke India left that year. After the departure of
Coke company from India, Union Minister for Industries George Fernandez said,
“Coke had 100% equity in India. Their investment was not much. They came into
the country with Rs. 6,00,000, which at the present rate of exchange is less than
$20,000. On this Rs.6,00,000 investment, they had taken out of the country, by a
modest estimate, 250 million rupees (about $ 8 million) as profit in the twenty years
they had been in the country”. Not only Coca-Cola but also IBM and many other
companies left from Indian market for the non-cooperating behavior of former
Government.
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8. Return to Indian Market
In Oct. 24, 1993, after sixteen years later, India’s attitudes toward foreign
investment changed and Coca-Cola returned the market without having to
divulge its formula. The ban was lifted in pursuance of India's liberalization
policy and Coca-Cola made a comeback. . In 1993 Coca-Cola re-entered after
government approval. That time P.V. Narashima Rao led Congress ruled
Indian Government who is referred as the, "Father of Indian Economic
Reforms" and also directly responsible for dismantling the License Raj. Due to
the new liberalization policies Coca-Cola was able to come back India. The
foreign exchange act which had once prevented companies from keeping too
much equity had now been completely modified.
The modification made it so that companies which exceeded foreign equity by
40% of the total were to be treated on par with Indian companies. Automatic
approval was to be granted for equity investment of up to 51% and for foreign
technology agreements in high priority industries. Non-Indian residents and
companies owned by them abroad were allowed to invest up to one hundred
percent equity in high priority industries, allowing greater freedom for
repatriation of capital.
But India is still a tough market. Most recently new domestic price
competition, a pesticide scare and cool weather have hurt Coke’s sales in
India, despite a general global rebound in revenues and profit.
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9. Challenges
In that time coca cola was returning faced some challenges.
They are mostly troubled by Economical, Political &
Environmental Issues. These are discussed as follows…….
Economical Challenge
 Risk of insolvency of buyer
 Lack of marketing expertise in the Indian conditions
 Money Inflation
 Availability of powerful competitors
 Increasing Maintenance cost
 Surrendering economic sovereignty
 Risk of protracted default
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10. Political Challenge
 Unstable political condition
 Changing governments in short time
 Corruption occurred by political people
 Several viewpoints of different political parties
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11. Social Challenges
 Risk of non-acceptance
 Lack of knowledge about Indian culture in detail
 Religious anxieties about its making formula
 Indian tendency to avoid foreign products
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12. Environmental Challenge
 Facing issues with water exploitation and resource
exploitation all over the world
 Bottles are not exploited and soil polluted
 Health consciousness of Indian consumers
 Farmers are suffering from water scarcity & subsidence of
water level
 Out flow of Carbon dioxide
 Hazardous by products and health issues
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13. Opportunities
Opportunities:
 Reputed brand
 Global brand recognition
 Modern bottling system
 Technological advancement
 Efficient management system
 Good marketing knowledge
 Huge market
 Advancement in technology
 Growing Indian market
 Good brand name
 International trade barriers has been reduced
 Youngsters’ tendency to adapt to the western
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14. Recommendation
 create proper relation between public, media, employees, trade channels,
state and national government and suppliers etc.
 Arrange seminar, conference, promotional activities and advertisement
through media.
 Understanding consumer behavior to listen their comments, make
necessary adjustments on service and products and creating a strong
customer base.
 Having an align management style between domestic and overseas
employees in the long run.
 Give more attention to quality on price. Because Indians are those who
give more importance for quality and trust. Even if the prices are higher,
Indians may consider this product due to its quality.
 Gather knowledge about Indian culture and religious activities. It helps to
maintain proper manufacturing and marketing plan.
 Make social awareness about that Coca-Cola isn’t responsible for any type
of hazardous activities on environment and free of pesticides.
 Preparing forecasts and predictions for proper planning on operational
activities which helps on companies long run.
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15. Conclusion
The objective of this study is for learning to India
international trade policy & coke’s trade policy, Coke’s
social responsibility, Environmental responsibility,
Economic responsibility & policy, to learn international
trade, trade challenges, Risk & opportunities. The Coca-
Cola Company has surely become part of people’s lives.
To produce the world's best known product, The Coca-
Cola Company has to employ the highest quality
processes and establish standards which guarantee the
production of a standardized product which meets
consumers' high expectations each and every time they
drink a bottle or can of Coca-Cola, And to create
established market in India & all world they working
hard work.
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16. Thank You
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