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Porter’s Five Forces Model of PEPSI

Porter’s five forces model is a framework for the industry analysis and development of business strategy. Three (3) of Porter’s five (5) forces refers to rivalry from external/outside sources such as micro environment, macro environment and rest are internal threats. It draws ahead Industrial Organization economics to develop five forces that conclude the competitive intensity and consequently attractiveness of a market place or industry. Attractiveness in this framework refers to the generally overall industry profitability. An "unattractiveness" in industry is one in which the mixture of these five forces proceed to constrain behind overall profitability. An extremely unattractive industry
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Coke and Pepsi both players have the majority of the market share and rest of the players have very low market share.
Scope of Competition
Scope of competition in this industry is generally global; Coke and Pepsi are approximately presents in 200 countries.
Fixed Storage Cost
This industry needs huge manufacturing plants and contracts with bottling network companies. These contracts make sure that bottler’s must have standard manufacturing plant; these plants need huge capital and exertion.
Degree of differentiation
Marketing and Product differentiation have become more significant. Coke and Pepsi mainly are competing on advertising and differentiation rather than on pricing. Pepsi has diverse advertisement campaigns according to conditions. Pepsi is recognized as the best-known brand name in the globe. More prominently, its consumers would not do without it, and have established a loyalty.
Strategic Stake
Pepsi’s core operation is the manufacturing and distribution both for itself and beneath franchise, of non-alcoholic beverages and related products. Because of the strategic stake the main brand of the Pepsi has been around for a lot of years. 3.The threat of substitute products

This industry is enriched with enormous statistics of substitutes such as: water, tea, beer, juices, coffee, etc presented to the end-consumers.


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