In analysis of Coca-Cola, there are some major reasons as to why the soft drink industry is so profitable. The core competency will determine the industry's profitability. There are two important and main core competency for Coca-Cola, one is distribution and manufacturing networks, the other one is its Brad name and customer loyalty. In essence, Coke's dominance in the world's soft drinks industry is by no means a surprise or accident.
1. manufacturing networks.
First of all, according the research, the production and distribution of CDS includes four major elements: concentrate producers, bottlers, retail channel, and suppliers. Specifically, concentrate producers and bottlers are extremely interdependent, the producers negotiate directly with the bottlers for pricing and distribution, and it also means Coca-Cola has worked extensively to build a comprehensive supply network. Coca-Cola have nearly 275 bottling partners worldwide. They manufacture and package our beverages. They also merchandise and distribute our beverages to customers and vending partners, who then sell our products to consumers. The range of bottlers from large, international, company to small, family-owned business. The most bottling partners are not owned or controlled by Coca-Cola Company however, bottling partners are significant connection with customers and consumers. Coca-Cola work closely with bottlers to ensure their operations are aligned with our policies and initiatives. Definitely ,The most important part on this value chain is the bottlers, and the core competency is concentrate producers and bottlers are extremely interdependent which makes supply power and threat of entry are always low. For example, the Master Bottler Contract lets Coke have enough power to control the concentrate price. The robust bottle network also implies that it would be nearly impossible for new entrants to enter the industry.
