The Coca-Cola Company is the world 's largest beverage manufacturer, distributor and is the leading producer and marketer of soft drink industry (Gee, 2003). Coca-Cola was invented back in 1886 and has become the most popular and biggest selling soft drink in universe. The company produces more than five hundred different brands around the world, which helps to satisfy needs of its highly diversified target market. The Coca-Cola started to operate a franchised distribution system three years after its invention. According to Wood (2004), it sells concentrated syrup to franchised bottlers in more than 200 countries including Uzbekistan.
The Coca-Cola Bottlers Uzbekistan, Ltd. (CCBU) began operate in October…show more content… In fact, CCBU buys high fructose corn syrup as its ingredient inside the United States and sucrose only in countries other than US like Russia, Ukraine and Uzbekistan. The main supplied ingredient is sugar, commonly available in an open market of the country. Thus the power of suppliers is low, as the company can buy sucrose instead of fructose. However, if sugar becomes too expensive, the Coca-Cola Bottlers Uzbekistan, Ltd. can buy corn syrup instead.
Threat of substitution: Median to high pressure
Large numbers of substitutes are available in local market of Uzbekistan like tea, juice, water, coffee, etc. In fact, Coca-Cola competes with a number of local beverage firms, for instance Arktika Bottlers, Baraka, Jus n Joy, Silver Water and others. While those companies are far from being as recognizable as Coke, they offer products for substantially lower prices. Thus, switching cost of the substitute products is very low so consumers can easily shift towards the substitute products, but again there are a huge number of potential customers of Coca-Cola which are not likely to change the product. And the quality of the cheaper products is lower as well.
Examples of substitute beverage companies in Uzbekistan
Jus n Joy
The beverage company Sibur distinguishes by making innovative marketing and massive advertising which builds growth for their brand that highlights benefits. To