Why Is The Luxotica Industry Greedy

Is Competition Beneficial? Competition is prevalent in various aspects of life, including sports, school, and jobs. Everyone at some point in their lifetime will have to compete against others in order to achieve a goal or earn a prize. It’s how the world has worked for a long time; it’s survival of the fittest and this minor competition between everyone is how we have continuously gotten smarter, faster, and stronger. Competition is necessary to a certain degree, but how much is too much? It’s definitely not a bad thing, and as long as there’s a healthy amount, it can be beneficial because it fosters self-improvement, and it will push people to go all out and try their absolute best.

Have you ever seen someone wearing a very rare pair of shoes that you have never seen before? Have you ever wondered how they got these shoes and how much they cost? Believe it or not Nike’s Air Jordan line of shoes has been at the forefront of a decade-long sneaker craze, which has grown so much it has become its own stock market. Jordan’s have been popular for many years and it is shown throughout pop culture, the increase in price and demand, the resale market that has skyrocketed in the last five years, and the history behind the shoe that made them so popular. Jordan’s are very well advertised through several popular outlets.

  D’s Dang Cameras Jordan Beadle  Esperanza Benitez  David Dang  Sean Kelly  Thom Thurn             Strategy Formulation and Initial Implementation   Our company wanted to appeal to as many consumers as possible and gain market share  through value and competitive cost. We realized that not every person would need an extremely  high end camera to capture life’s simple moments, but consumers would still appreciate a high  value product without the intimidating features of some high­end cameras. We chose to  implement a Best­Cost strategy, which allows our company to deliver a quality camera at a fair  price and offer more in terms of value than the lower PQ rated cameras. We believed this  strategy would allow us to gain market share through a value based offer, in turn garnering a  brand that was associated with value at a fair price.  We initially implemented this plan by offering a 3 star PQ rated entry level camera at a  price point that would hopefully undercut competition of similar rated cameras and still offer a  camera that could compete with the high end cameras. We believed this strategy would entice  customers that normally would purchase a lower end camera based on price, and also customers  who usually bought cameras for the high end specs. This strategy allowed us to meet our  consumers in the middle ground on price and value in order to create a brand that was associated  with the most value for dollars spent.   Adjustments to Strategy   Year 6  For Year 6, we aimed to compete with a best­cost strategy. Initially we started off with  three star entry level and multi­feature cameras and an aggressive marketing strategy. We  increased our prices from Year 5 across the board and put a lot of money into marketing. We  invested $570 in North America, $500 in Latin America, $400 in Europe­Africa and $350 in  Asia­Pacific. In regards to the prices of the entry level cameras, they were $175 in North  America, $163 in Latin America, $165 in Europe­Africa and $240 in Asia­Pacific. Our goal was  to increase our market share in all four regions through an aggressive marketing campaign,  therefore increasing brand exposure and equity. Unfortunately, this strategy put us in last place in  the industry for the first year that we took over the company.  Year 7  For Year 7, we cut back our prices in a couple of regions in hope that it would increase  our sales and market share. Specifically, we lowered our entry level camera price in North  America by $7, in Europe­Africa by $15 and in Asia­Pacific by $80. In Asia­Pacific we also  lowered our multi­feature camera price by $210. In order to remain competitive with a best­cost  strategy in the industry, it was imperative that we lower our prices. Our competition, particularly  those selling similar quality products (3 star cameras), was charging far less than we were and  corrective measures had to be taken. By charging such high prices in regions such as  Asia­Pacific, we could be losing customers. This did help improve our revenues and image  rating, but our EPS, ROE and SP were at one of our lowest.  Year 8  In year 8, we decided that in order to reduce our costs we would need to cut back on our  advertising and R&D costs. Although it was part of our initial strategic plan to have an emphasis  on marketing, our company needed to adjust its costs in order to compete with the success of our  competitors. We also noticed that our entry level cameras were one of the higher quality cameras  in our industry, so we raised the prices on our entry level cameras in three of the regions as an  attempt to increase our revenue. We decided to make no changes to North America because  unlike in the other regions, the demand was not as high there. This same year we also chose to  maintain our multi­feature camera prices the same as the year before. We made no improvements  to the product itself and for a best­cost strategy it was competing well in the industry.  Year 9  In year 9 we continued to gradually increase our prices. This year we increased both the  entry level and multi­feature prices, except for our multi­feature in Europe­Africa and  Asia­Pacific. Although our competitors began to improve their product quality, we kept ours  constant. We wanted to compete with a best­cost strategy by providing an average value at a  reasonable price. Our entry­level cameras did very well this year, but our end results showed that  we needed to pay attention to our multi­feature cameras for next year.  Year 10  For year 10 we decided that it was time to slightly improve the quality of our  multi­feature camera in order to remain competitive. We improved some of the core components  in our multi­feature camera so that it would be at a 3½ star quality. In order to compensate for  the higher costs that came with making a higher quality camera we increased its price. We based  our price increases off what our competitors were charging for a similar quality camera, while at  the same time trying to stick with our best­cost strategy. This year we also decided to cut back  significantly on R&D costs. We chose to spend nothing for our entry­level cameras and only  about $1000 for our multi­featured. We thought that cutting costs would help increase profits for  our next year.  Year 11  Year 11 was a good year financially, so we decided to not make any major changes in  terms of changing the price or quality of our products. We kept the prices the same as year 10 for  the most part, with only changing the price of our multi­feature in Asia­Pacific. We increased the  price of that one single product and region because we had been selling out, and by increasing  the price we could potentially decrease demand. For this year we also decided to use some of our  cash at hand to pay back some of our debt.  Year 12  For year 12, we again chose to improve the quality of our multi­feature camera. Our stats  were looking very well from the year before, so we decided to increase the quality of our  multi­feature camera by half a star in order to remain competitive. With half a star increase we  were now at a 4 star quality camera, which was average against our industry competitors. We  also increased our prices for our multi­feature this year. Since our entry­level cameras seemed to  remain competitive as they were, we decided to make no changes to either the quality or the  prices for this year.  Year 13  On our last year we decided to maintain our prices and quality very close to those of year  12. In year 12 we made changes to our multi­feature model, so we didn’t think that changing our  prices or model right away in the next year would be good for our sales. Throughout all eight  years we maintained our corporate sponsorship contributions pretty constant. We maintained our  contribution of $500 towards energy efficiency programs as well as participated in “Green”  Initiatives to Promote Environmental Sustainability. This function of the company was not a  priority for some of our managers, but yet still important for our company, therefore we were  able to compromise with making this small and constant contribution towards corporate social  responsibility. Also, throughout all eight years our labor costs remained pretty constant. We did  not make any major increases because of our best­cost strategy; we always looked to reduce  production costs wherever possible.  Assessment  Year 6  Year 6 proved to be a difficult year for our management team. We had the lowest  Earnings Per Share (EPS), Return On Equity (ROE), and Stock Price (SP) amongst our  competitors. D’s Dang Cameras had an EPS of $1.83. Meanwhile, the SP dropped to $28.75. The  team did manage to achieve a ROE of 17.3%, an image rating (IR) of 73and a credit rating (CR)  of B+ for Year 6.   Both our entry level and multi­featured cameras were at the high­end of the production  benchmark scale. While providing a great product with exceptional value for our customers was  a main focus for our team, this resulted in a high total cost of production, ultimately hurting our  bottom line. Our entry level camera had a total cost of $125.29/unit, the highest in the industry.  The multi­featured camera cost $303.96/unit, hovering right above the average of $303.56.   Taking a closer look geographically, D’s Dang Cameras earned the lowest operating  profit per unit in North America, Europe­Africa, and Latin America. Asia­Pacific was the  exception, earning the highest operating profit per unit in the industry with $58.86. Although we  had a relatively high net revenue, we also had extremely high production and marketing costs,  which resulted in D’s Dang Cameras earning the lowest operating profit and net income in the  industry.    Year 7  Year 7 was another difficult year for our team. We failed to meet the BOD’s expectations  on EPS, ROE, and SP. EPS dropped to $1.69. ROE was 13.8% and the SP slipped to $26.05.  Fortunately, the company was able to maintain a CR of B+ and actually increase the IR to 81, the  second highest in the industry.    Our team was able to cut costs, bringing the total cost of production down for both  models. The entry level model cost $119.88/unit, while the multi­featured model cost $290.22.  Across all four geographic locations in the entry level segment, D’s Dang Cameras had the  lowest operating profits and even suffered losses in Latin America. The multi­featured segment  fared marginally better, with above average operating profits per unit in Europe­Africa  ($140.72), Asia­Pacific ($119.97), and Latin America ($59.97) and below average in North  America ($70.67).   We had the third highest net revenue, recording $271,206,000 in sales. Taking into  account last year’s similar performance, this shows we do have a good product that does sell  well. However, we were once again hindered by our astronomical operating costs. With  production costs at 76.6%, delivery costs at 4.7%, marketing at 5.6%, and administrative costs at  5.7% of total revenue, D’s Dang Cameras operating profit margin dropped to 9.7% leaving net  profits at 6.2% totalling $16,868,000.   Year 8  Year 8 was a marked improvement from the two previous years and initiated a welcomed  turnaround for D’s Dang Cameras. Management not only met, but surpassed all of the BOD’s  expectations. EPS reached $3.30, an annual change of +95.27%. ROE was 21.2%. The SP  increased substantially to $41.02. D’s Dang Cameras recorded an increase in CR to A­, while our  IR remained constant at 81.  Again, our team managed to lower the production costs of the entry level to $114.63 and  multi­featured to $283.18. In addition, we raised our prices and realized a net revenue of  $277,940,000. We lowered the production cost to 69.4%, leading to an operating profit margin of  17.5% and a net profit of 11.9% equalling $33,021,000. Despite these improvements, our  demand and market share across all regions still lagged behind our competitors.    Year 9  In Year 9, D’s Dang Cameras once again surpassed all the BOD’s expectations. EPS was  $4.67, ROE was 23.1%, SP increased to $60.05, and the CR rose to an A. Unfortunately, the IR  fell 12 points to 69.   In a continued effort to cut costs, the entry level model cost dropped to $110.90/unit.  Multi­featured cost fell to $269.89. Relative to our competitors, operating profit per unit in North  America and Asia­Pacific fell below average in the industry. Europe­Asia was the lowest in  industry, while Latin America was just above average. Disappointingly, our multi­featured  cameras operating profits per unit was below average across all regions. Year 9 also suffered  from low volume of sales, with revenues coming in at only $264,065,000, the lowest since Year  6. Production costs did drop, however, to 61.3%, allowing D’s Dang Cameras to earn a operating  profit margin of 25% and a net profit of 17.7% of revenues totalling $46,649,000 ­ our highest  since the start.  Year 10    In Year 10, management once again met all of the BOD’s expectations for the year. EPS  and ROE decreased slightly to $4.08 and 20.1%, respectively, but remained above expectations.  The SP increased to $62.22, up $2.17 from the previous year, as did the CR, now at A+. The IR  rose to 70.   For Year 10, management decided to invest in product improvements in the  multi­featured segment to stay competitive, increasing the unit cost for the multi­featured  cameras to $307.50. That being said, the team was able to lower production cost of the entry  level camera to  $109.65/unit. To cover the newly incurred costs of the multi­featured cameras,  price increases across all regions were put in place. Despite improvements in our product  offerings and the increases in prices, total revenues decreased again, totalling only $255,188,000  ­ the lowest throughout management’s 8 years.  This was in part due to the increases in  production costs (65.3%), as well as our decision to increase our marketing expenditure.  Unsurprisingly, this resulted in a lower operating profit margin of 20.5% and a net profit of  14.7% for a grand total of $37,430,000.   Year 11  In Year 11, EPS, ROE and SP all reached their highest points throughout management's  tenure. EPS was $5.85. ROE came in at 24.3% and SP jumped up to $91.09. The company’s CR  remained at the highest rating, A+, but the IR once again slipped below expectations to 69.    For Year 11, management decided to increase our market exposure by maximizing our  distribution channels, yielding positive results. D’s Dang Cameras earned $292,031,000 in net  revenues ­ the highest for the team throughout the eight years. Management also focused on  re­aligning with our cost­cutting strategy. Production cost, although still high relative to our  competitors, reached its lowest point of 61%, lending to the highest operating profit of 25.4%  and net profit of 18.4% for year­to­date. Year 11 was also management’s most profitable year,  with D’s Dang Cameras earning $53,708,000 in net income ­ roughly average compared to our  competitors.    Year 12  Year 12 was another difficult year for D’s Dang Cameras. EPS and SP fell sharply to  $3.94, and $71.33, respectively. ROE decreased to 21.4%, while the CR remained constant at  A+. IR fell again to 68.   Improvements in product design produced our highest unit cost of $362.01 for the  multi­featured cameras. Management also invested in overall production capabilities in an  attempt to decrease our outsourcing costs. This hurt our margins yet again and resulted in below  average operating profits per unit throughout each geographic region. Year 12 had comparatively  mid­range net revenues of $263,340,000. Production costs rose, as expected, due to our  investment in production capabilities to 67.9%. Similar to year 10, the team chose to increase  marketing expenses to increase consumer awareness. This lowered operating profits to 17.2% of  revenues and net profit to 12.2% totalling $32,177,000.   Year 13   In the final year, EPS fell to $3.57, as did ROE to 19.9%. SP decreased to $55.70. Our  CR fell to an A. Lastly, our IR fell once more to 64, the lowest throughout the eight years.   We maximized distribution channels and tried to stay competitive in price, promotions,  and warranty period, but our high labor cost, warranty costs, and warranty claim rates, increased  the cost per unit of both our entry level and multi­featured cameras. The increased marketing  expenditures hurt margins even harder in Year 13 due to decreased demand and market share  across all markets. Low sales and high costs were the exact opposite of our teams goals and have  plagued us since the first year.    Key Learnings   Over the course of our years acting as managers, our team learned many things about  how to effectively develop a strategy.  It is important to be able to compete aggressively, but not  recklessly, because there are a limited number of years in the decision making process.  To make  progress, every year’s decision must be thought out thoroughly and the pros and cons weighed  extensively ­ one crucial lesson we learned debatably too late.  In year six, we decided to allocate  a large sum of funds to advertising and marketing.  This decision turned out to be unwise and  ended up setting us back for several years of our management.  Instead, we learned that we  should not focus heavily on advertising right out of the gate, but rather wait several years until  our company has built up a positive image rating.  From that point forward, we could gradually  increase advertising until a heavy advertising focus is achieved.  A lot of money was wasted  early on advertising and we feel this attempt was in vain because our company did not yet have  an established market share and consumers did not have adequate knowledge of our product.  Another key factor learned was regarding our product pricing.  Our company increased  prices right away in year six.  This negatively affected our earnings per share and return on  equity.  We should have waited to increase prices, or not increase them significantly at all, in  order to remain consistent with a true best­cost strategy.  With lower prices in the first several  years of the game, we could potentially have sold more units and increased our market share  earlier.  Keeping prices lower would have allowed us to compete better with our competitors  right out of the gate. It would be especially crucial to keep Asia­Pacific region prices low  because that is where we had our smallest market share. We risked alienating customers by  initially increasing our prices in that region.  Cutting back prices, we learned, also helped  increase our revenue and image rating.  There are several factors that are important for future management to take into account.  Future management should learn from our mistakes and uncertainties.  When choosing a  strategy, it is of the utmost importance to stick with that strategy in order to form an image that  resonates and provide consumers with a clear understanding of what we do and how our  company works.  It is necessary to remember to balance the focus on both entry level and  multi­featured cameras.  Also, outsourcing is an important way to reduce costs.  But most  importantly, future management must choose the correct pricing for both models of camera.  It is  difficult to increase prices to remain competitive while at the same time remain loyal to our  best­cost strategy.  Our management team made the mistake of having inconsistent pricing,  which did not bode well for our initial goal of a low cost strategy.  Advice for Future Management   Future management needs to continue competing with a best cost strategy in the market  place. Consistency is key for success in any market, especially the digital camera market so that  should remain at the center of the best cost strategy. Management will need to continue offering  an above average quality product for a slightly lower than average price, maintaining a PQ rating  of 3. Our chief competitors are J Company, Eclipse, and Habitat. In order to offer competitive  advantage over our competitors future management will need to compete on price very closely  with company Eclipse, as they control the majority of the market share. Our team has done a  good job creating a niche market in Latin America and North America, however future  management needs to focus on growing its market share in Europe­Africa and Asia Pacific. They  should do this by increasing their advertising to around $500 million each quarter. To increase  market share they should also lower the price of both the entry level camera and the multi  featured camera in these two regions to at or below $160 and $450 respectively.   Future management should cut costs and find synergy savings within its suppliers and  distributors in order to increase profit margins. Another way to increase profit margins is to cut  the warranty period for both the entry level and multi­featured cameras to under 3 months. With  these savings that future management will accumulate, they should put towards raising the salary  of the workers. When the workers get paid above average they will be more productive, and  therefore there will be less of a need to hire new people at year end. Future management will  fortunately run into a lot of cash on hand, and they should spend it by repurchasing more stock,  and also by purchasing a new plant. With a new plant, they should be in better shape as to not  run out of inventory.  Future management needs to consider the external environment when making strategic  decisions. They should keep in mind that the camera industry will continue growing at a rate of  4­8%** for the next _____ years, making the industry extremely attractive for earning good  profits. Future management will need to also keep in mind the three chief rival competitors,  previously mentioned, that they will be competing with in the future. In order for management to  out compete its competitors they will need to offer different performance features, better  customer service, and better product performance. It is important to watch how each competitor  competes on price and the product design or quality that they are offering. They will also need to  identify who their target audience is, the geographical areas in which they reside, their  demographics, their needs, and most importantly who their target audience is NOT. Fortunately,  the camera industry will not have any issues with new legal or regulatory issues. However,  technology is always changing and getting better so it is important for future management to  keep up with its development by investing in research and development so that they always have  the best quality products for the best price.   Future management will have the internal capability to make the best quality product on  the market, however they should stick to the best­cost strategy. They will also have the capability  to increase their IRby increasing their corporate social responsibility. Future management should  invest in environmentally sustainable products and the disposal of those products. Additionally  they will have the strength to produce as many cameras as they need. More importantly,  as time  passes, management will have the capability to decide if their strategy is working. They can do  this by asking themselves three very simple questions, which are: Does the strategy fit the  position of the company and its resources? Does the strategy produce a competitive advantage?  Does the strategy produce good profits, and is it meeting the company’s financial objectives? If  the current strategy is not doing those three very important things than they will have the  capability to correct the strategy to ensure that it does in the future.             A2.The BOD’s five performance objectives are as follows:  1. 2. 3. 4. 5. Earnings Per Share (EPS) ­ Grow earnings per share at least 8% annually through Year  10 and at least 4% annually thereafter  Return on Equity (ROE) ­ Maintain a return on equity investment of 15% or more  annually  Stock Price (SP) ­ Achieve SP gains averaging 8% annually through Year 10 and 4%  annually thereafter  Credit Rating (CR) ­ Maintain a B+ or higher CR annually  Image Rating (IR) ­ Achieve an IR of 70 or higher annually    A3.  Year 6  EPS ­ $1.83 (Target EPS ­ $2.16)  ROE ­ 17.3%   SP ­ $28.75 (Target SP ­ $32.40)  CR ­ B+  IR­ 73    Year 7  EPS ­ $1.69 (Target EPS ­ $2.35)  ROE ­ 13.8%   SP ­ $26.05 (Target SP ­ $35)  CR ­ B+  IR­ 81    Year 8  EPS ­ $3.30 (Target EPS ­ $2.56)  ROE ­ 21.2%   SP ­ $41.02 (Target SP ­ $37.80)  CR ­ A­  IR­ 81    Year 9  EPS ­ $4.67 (Target EPS ­ $2.79)  ROE ­ 23.1%   SP ­ $60.05 (Target SP ­ $40.82)  CR ­ A  IR­ 69    Year 10  EPS ­ $4.08 (Target EPS ­ $3.04)  ROE ­ 20.1%   SP ­ $62.22 (Target SP ­ $44.09)  CR ­ A+  IR­ 70    Year 11  EPS ­ $5.85 (Target EPS ­ $3.16)  ROE ­ 24.3%   SP ­ $91.09 (Target SP ­ $45.85)  CR ­ A+  IR­ 69    Year 12  EPS ­ $3.94 (Target EPS ­ $3.29)  ROE ­ 21.4%   SP ­ $71.33 (Target SP ­ $47.68)  CR ­ A+  IR­ 68    Year 13   EPS ­ $3.57 (Target EPS ­ $3.42)  ROE ­ 19.9%  SP ­ $55.70 (Target SP ­ $49.59)  CR ­ A  IR­ 64      

But, omnisciently speaking, both entities faced severe scrutiny and criticism from United States and international citizens for their capitalistic business practices. Furthermore, a vast number of American citizens, mainly teenagers, had been killed over Nike Air Jordan sneakers because of their high price tag, while the cost to produce the shoes were rapidly declining due to Nike’s unprecedented offshore production. Bill Bigelow’s, The Human Lives behind the Labels: The Global Sweatshop, Nike, and the Race to the Bottom accurately portrays this capitalistic mentality when mentioning, “children as young as 6 are ‘sold and resold like furniture, branded, beaten, blinded as punishment for wanting to go home...’ For pennies an hour, these children work in dank sheds, stitching soccer balls with the familiar Nike swoosh and logos of other transnational athletic equipment companies” (Bigelow, 113). What is most disturbing to fans of Nike and Jordan were their comments and proposed remedies on the matter. Essentially, Jordan did nothing to curtail the number of kids being killed for his shoes and, as far as his affiliation with capitalistic Nike, Jordan did not want to cause any kind of rift between himself and the corporation that made him millions

Price is an important factor in Burberry as price affects the value that costumers perceive they get from buying a product (Jobber & Ellis-Chadwick, 2012). Burberry uses competitive pricing similar to its competitors which produces a psychological effect on Burberry customers (Jacobson, n.d). If Burberry for example lowered its price dramatically then customers may believe the quality has decreased and may presume it’s not worthy to be named a luxury brand. However by being expensive it suggest better quality and desire to sustain its customers as well as making there products seem exclusive.

• The purchase of the Marcs and Morissey brands reflect the companies push towards a democrat that is younger and has more disposable

From what I have read, I came to conclusion that DuPont has mastered the art of deception through the years. They have used their wealth, power and influence to further their interest. I think that if they were a small company, then they would have been banned and bankcrupt long

4. 2001 sale of ImClone Systems stock - In light of this situation, and the intensive media exposure surrounding the case, do you believe that the Martha Stewart brand has been diluted? What evidence can you find in support?

“Everything is worth what people are willing to pay,” this quote is inaccurate because this company Luxottica knows that there will be uninformed consumers, so they keep their prices high. No matter what price the eyewear is, consumers are willing to pay. Luxottica is just keeping the prices up because the consumers don’t care. If they cared, then they wouldn’t buy any random eyewear because of the not affordable price. If Luxottica considered lowering the price, then they would have even more consumers, yet they would have to speed up the production of eye wear. Now that I think of it, Luxottica wouldn’t have to speed up producing their stock because it doesn’t cost that much to make them. Walmart really is a competitor of Luxottica because

Background: This case represents a prime example in terms of market demand and competition. Nike is one of the world’s largest athletic suppliers for a various number sports and other activities. Nike is well established globally and has over a million employees across 42 nations. New Balance has also been in the market a long time since 1906, but not quite as large as what Nike has to offer. “New Balance ranks as the fourth largest athletic footwear and apparel company in the world with $2.4 billion in annual sales” (Assche, 2014). Both companies have been very successful with their products and have an excellent reputation and image. Many consumers are brand loyal to both companies and it will be extremely interesting on what side the TTP takes when it comes down to focusing in on the importance of tariffs.

profit margin expectations handed down by corporate headquarters created an environment that encouraged the sale of Nike’s high-margin products to high-end customers. Regardless of the low cost of the World Shoes, they

Promotional pricing: temporary reduction in price on a number of products on offer Competitive pricing: because HN has a large share of the market they are “price leaders” and other businesses follow them

“Case Analysis of Luxor Cosmetic” REGIS UNIVERSITY Date: March 25th, 2013 Week-4 assignment MSAA 609: Cost Management Executive Summary An effective business strategy and budgeting is very essential in a manufacturing industry. A company without a proper business strategy and master budgeting plan would usually faces tremendous challenges and losses during its business operations. The

Luxottica literally owns almost all of the sunglasses industry, they have very little competition and high prices. It costs hundreds of dollars to buy a pair of sunglasses and only about 30$ to produce the same pair of sunglasses. Luxottica also has contracts with major companies such as Coach, Ralph Lauren, Channel, etc. Luxottica also owns Sunglasses Hut which is a very popular place to buy sunglasses. An interviewer asked the creator of Luxottica a bunch of reasonable questions, in which he avoided. One of the questions was “Are consumers happy with the expensive prices? Should sunglasses really cost that much?” The owner of Luxottica replied saying that consumers

“Have a Coke and a Smile” “A Coke is a Coke, and no amount of money can get you a better Coke than the one the bum on the corner is drinking. All the Cokes are the same, and all the Cokes are good. Liz Taylor knows it, the President knows it, the bum knows it, and you know it."(Andy Warhol, 1975) Regardless of its corporate reputation, the organizational performance and its social responsibility of Coca-Cola makes it loved around the world. Ever since its creation in 1886 Coca-Cola has been a household brand known globally for generations of families. I have to mention, of all the cases researched this is my least favorite not only because of my childhood love for the product because the ethical issues in one way or another always manage to resolve themselves not before further tainting the reputation Coke worked so hard to obtain. Most times, whether an organization is innocent of an unethical act, it becomes secondary to the suspicion of the original act. Almost as if the court of public opinion has the power to ruin the reputation of an organization based on an unfounded accusation. In spite of my loyalty after having ready the case, I do believe Coca-Cola to be flawed. The contamination scare in Belgium is a great example of a public relations nightmare. The slightest hint of impurity should have pushed Coca Cola into crisis management mode but they were slow to react, citing it a minor issue (Ferrell, Fraedrich, & Ferrell, (2011). It was not until local officials