Hello, I am hoping you can help me.There are two parts to this paper. 1. Develop a 750-word analysis for the company Coca-Cola based on
Hello,
I am hoping you can help me.There are two parts to this paper.
1. Develop a 750-word analysis for the company Coca-Cola based on the following information provided below. I have included what I have so farto serve as guide.
- Viability of the 3-5 Year Plan
- Stress Test Under Scenarios of Adversity
- Current Financing Plan
Thesis and/or main claim are comprehensive. The essence of the paper is contained within the thesis. Thesis statement makes the purpose of the paper clear.
2. Assume that you will be presenting your analysis to a group of senior management at your place of employment that urgently needs to know this information to make a major financial decision for your company. In 250 words, develop an introduction to your analysis that can serve as an overview. Consider factors that might impede their ability to focus on the information you are presenting. For example, some of your audience may be pressed for time, another may have a crisis in their work team that needs to be attended to quickly, and others may simply not be paying attention. You have one chance to impress them; keep your overview focused, succinct, and informative. Present only key and other potentially relevant points this group needs to know. It needs to be comprehensive and further incorporates analysis of supporting evidence insightfully and provides specific examples of relevance.
1 Running head: ANALYSIS OF The COCA-COLA CORPORATION 2 ANALYSIS OF The COCA-COLA CORPORATION The Coca-Cola Company (Coca-Cola), the world's driving soda creator, works in more than 200 countries and offers 400 brands of non-alcoholic drinks. Coca-Cola is likewise the most profitable brand on the planet. Coca-Cola is an all around perceived efficient organization. The Coca-Cola was established in May of 1886 and proceeds for over a century through the seasons of war and peace, flourishing and wretchedness and monetary blast and bust as late as the 1990s, Coca-Cola was one of the most regarded organizations on the planet, assembling and known as an incredibly fruitful administration group. Since 1998, the organization has been battling with inherent shortcomings and outside dangers. The motivation behind this contextual analysis is to survey the present circumstance of Coca-Cola and the business, assess the current assets, and give critical suggestions. This paper will examine this companies organization, provide general patterns that influence business, discuss the outer elements of Coca-Cola by utilizing Porter's Five Forces. It will also address key future difficulties confronting Coca-Cola and give suggestions. Fundamental Goals The goal of the Coca-Cola Company is to be regarded as a business who conducts their activities responsibly, ethically and sustainably in order to operate in tomorrow's world (Kaneshige, 2015). This has been accomplished through their partnerships with various conservation groups such as WWF (World Wildlife Fund) who work to protect the ecosystem. Also, by their involvement in initiatives to decrease global warming and to reduce the carbon footprint. Coco-Cola has been named the top contributors in their efforts to decrease greenhouse emissions in their manufacturing process, packaging and delivery to name a few. This company has announced they will set a 2020 conservation goal to use sustainable resources when using agricultural ingredients (Kaneshige, 2015). 3 ANALYSIS OF The COCA-COLA CORPORATION Analysis of Fundamental Strategies Coco-Cola's marketing and advertising strategy has played a significant role in how they connect and reach their consumer base. These strategies encompass creativity, consumer engagement, marketing campaigns, and extensive product development. This has helped Coco-Cola reach a strong strategic position in building strong partnerships with similar firms and marketing partnerships. This has given the Coca-Cola Company the ability to team up with a large array of partners from grocery stores to technology companies. In order to maximize on efficiency and capitalize on the benefits of a wide established infrastructure. Product customization has given this company the ability to meet current trends as well as exploring various strategies to market consumers. The bottling is decentralized and the products are customized. An example some of the countries the Coca-Cola Corporation sells the beverages have people's names imprinted on them. Additionally, the company has recently accepted the customization of its product for the European Union by removing or substituting some ingredients. Analysis of Fundamental Markets Coca-Cola serves a large global market and is headquartered in the United States. The company is a global brand and ships its beverages to several regions such as Asia, Africa and Europe. The Coco-Cola company is the leading drink maker surpassing its competition around the globe such as Pepsi, Afia and Demonte. The use of the internet has boosted its global presence, market shares and consumer loyalty in becoming more marketable. Analysis of Fundamental Competitive Technology 4 ANALYSIS OF The COCA-COLA CORPORATION The company has heavily invested in competitive technology in order to serve a higher quality beverage, lower prices, and increase the marketing efforts. To have a strong competitive advantage Coca-Cola began to virtually outsource ideas to various firms. The end result was developing an ecofriendly beverage containers made of ice to reduce the number of plastic and glass pollutant on the globe. The company has also invested in vending machines that mix and match flavors. Additionally, the company has a strong online presence particularly in advertising (Ireland, n.d.). Analysis of Fundamental Regulatory and Operating Characteristics. The Coca-Cola Company has conformed to several legal regulation mechanism as well as internal mechanisms that are aimed at providing safe and quality services to the community and its consumers. The company strives to meet the Food and Drug agency regulations as well as its own set of quality assurance regulatory measures. Analysis of Fundamental Revenue outlook Coca-Cola perceives revenue when enticing proof of a game plan exists, conveyance of items has happened, the business value charged is altered or definable, and collectability is sensibly guaranteed. For Coca-Cola, this for the most part implies that Coca-Cola perceives revenue when title to items is exchanged to packaging accomplices, affiliates or different clients. Specifically, title for the most part exchanges upon shipment to or receipt at Coca-Cola's clients' areas, as controlled by the particular deals terms of the exchanges. Coca-Cola's business terms don't take into account a privilege of return aside from matters identified with any manufacturing deformities on part. 5 ANALYSIS OF The COCA-COLA CORPORATION The Coca-Cola Company revenue and development has stayed stable throughout the years. There have been different vacillations because of the elements of the industry. An illustration of this is the organization anticipated its revenue would develop at an average of 5.75% every year. This year's 2016 projection anticipated 3.73% abatement in revenue in the course of the most recent year. This is due to the decline of the organizations battle to achieve creating markets. Overall, Coca-Cola Company is doing excellently well inside their present market space (NASDAQ, 2016). Coca-Cola's networking revenues have significantly declined from 2013 to 2014 and from 2014 to 2015. Of the $45.9 billion profits generated by the Coca-Cola organization out of all out the revenues in FY'14, $17.9 billion were the aggregate expense of goods sold. This was caused due to the incorporation of raw material costs-sweeteners, metals, juices and PET and costs identified with the development of completed goods from manufacturing areas to deals distribution focus ANALYSIS OF THE COCA-COLA CORPORATION The organization reported substantial entire year worldwide volume shipment development of 4% and income developed 4% in 2012. Key created markets performed well and these incorporate North America and Japan (both up 2%). Europe volume declined 1% for the entire year, reflecting progressing general macroeconomic conditions. As far as developing markets, TCCC delivered solid volume development in the major emerging markets, for example, Thailand (up 22%), India (16%) and Russia (8%) for the entire year. Marginally influenced by the moderate economy, TCCC conveyed 4% volume development for the year as a whole in China and reduced climate, what's more, a later Chinese New Year added to the cheap deals. Nonetheless, the organization is contributing vigorously in the nation and has the full certainty of its business. 6 ANALYSIS OF The COCA-COLA CORPORATION Investments to Support the Business Unit Strategy Coca Cola is a leader in the beverage industry by having the highest market share as compared to the rival companies. This global firm has come up with strategies to enhance future control of the market as well as maintaining high profitability levels. Coco-Cola's management has made a number of investments on viable projects in order to support other business unit strategies. These particular investments are called cash equivalents they are highly liquid and have a mature rate less than three months. Coca-Cola has implemented a cost effective strategy to manage exposure to counterparty risks by having clear policies in place to monitor credit risk concentrations, diversifying counterparty and providing minimum credit standards to all parties. Most of the investments made by Coca Cola are classified as short term, equity and debt securities (Barham, 2012). Since Coca-Cola aims at achieving high value in the market these investments are helpful since the debts or equity rises in value depending on the performance of the company. Therefore the management develops a valuation model that gives significant influence in the operations of investee. Investments in debt securities are carried at either amortized cost fair value which is also the case of equity investments that are classified as either trading or available for sale. The Coca Cola Company reviews the investments to determine whether there is a significant change which might adversely affect the operations of the company. Approaches such as discounted cash flows, appraisals and sale proceeds estimates as the appropriate valuation methodologies. This is beneficial when the company considers future prospects when determining the current value. Conventional society advocates question enterprises' key inspirations for CSR, attesting that corporate projects to reserve social and natural projects are nothing more than advertising 7 ANALYSIS OF The COCA-COLA CORPORATION efort to support their image notorieties, frequently lopsidedly to the exertion itself. This rejection of CSR lives in a key doubt of an enterprise's individual goals to do much else besides expand its benefits. On the ideological right, commentators dismiss the part of CSR in an entrepreneur society where the essential duty of business seen as making monetary returns for its shareholders and the bigger economy. An organization's worth, as per these pundits, lives altogether in its capacity to create money related riches for its shareholders, and any social or natural activity that does not all the while making benefit for an organization is esteemed to be a misuse of corporate resources. This perspective established on stark outlines between the circles of obligation and impact of government, conventional society and the business part. As indicated by this contention, if every division did what it should do, a prosperous and just society would thrive with an ideal allotment of resources. Further intensifying assaults from the left and the privilege is the utter absence of measurements to assess the viability of CSR projects. For an area driven and determined by its estimation of money related returns and ventures, the lack of any settled upon measures to evaluate the social or ecological return of cash spent on CSR appears to run counter to corporate ethos[Kan15]. Assessment on the future Profitability and Competitive Performance Development and electric advertising systems are utilized by this team to achieve upper hands in the drink business. It has given Coca-Cola the capacity to be enormously productive and has taken into account critical development potential. To guarantee no matter how you look at it, consistency Coca-Cola has effectively utilized various methodologies to secure the brand and market position. A few the necessary activities are turning into a top worldwide supporter for all 8 ANALYSIS OF The COCA-COLA CORPORATION occasions and celebrations. It has given the organization selectiveness and introduction in situating their image at times. Coca-Cola utilizes its item by associating it with the enthusiasm of its buyers through their contribution to games, music, society and family[Ire16]. During that time this organization has confronted an inundation of low and high benefit development. It has made Coca-Cola set out on another system intended to reestablish their position in the business sector and proceed with their strength in the refreshment business. The development arrangement system will steady of worldwide extension to different nations that have a low level of per capital utilization. Coca-Cola venture overall revenues stay stable because of expansion in deal volume from developing markets in Africa and European clients. It has gainful in developing organization benefits and advancing their image. Customer maintenance and the fantastic administration have been a central part of ensuring future benefits and setting aggressive costs for all Coca-Cola items. SWOT Analysis Strengths: - 1.The main refreshments brand regarding scope and deals 2. Well known auxiliary brands like Coca-Cola, Fanta, Kinley, Limca, Maaza, Minute Maid, and so on. 3. Worldwide span with nearness in more than 200 nations 4. More than 500 brands on offer 5. A worker quality of around 1, 50,000 individuals all inclusive 9 ANALYSIS OF The COCA-COLA CORPORATION 6. Reliable and efficient inventory network system, guaranteeing that every one of the items is accessible even in the most remote spots 7. Sharp money related condition 8. High brand review through promoting and advertising by connecting with superstar brand ambassadors[Nas16]. Weakness: - 1. The nearness of hints of pesticides in the cola refreshments has made harms the brand picture. 2. Intense rivalry in the circulated air through beverages section from PepsiCo implies constant battle about piece of the overall industry 3. No nearness in the snacks and nourishment industry. Opportunities: - 1.Increase it's reaching undiscovered nations and business sector. 2. Market and advance the less known items. 3. Acquire different organizations. 4. Diversify its item portfolio by going into snacks industry to rival PepsiCo Threats: - 1.Health cognizance amongst individuals 2. Difficulty in conforming to various government directions and standards in various nations 3. Inflation, monetary stoppage, and shakiness 4. Intense rivalry 10 ANALYSIS OF The COCA-COLA CORPORATION External financing is an invaluable resource to provide funding for a business. There are two different types of financing that involve debt and equity. Debt financing involves bank loans investments from outside investors and lenders who provide financing to fund or grow business operations. On the other hand equity financing involves a procedure where a company decides to give its ownership in order to raise funds. This paper provides details on the comprehensive income as a result of the change in the equity (net assets) of Coca-Cola Company with a great concern with the company's future external financial needs. It covers the company's ability to make cash from their operating activities that are part of their main financial strength as explained from the company's liquidity, capital, and financial position. Analysis of Liquidity, capital sources and financial position Coca-Cola Company relies on financial strategies to boost capital. This is accomplished through external financing to increase cash flow. This company's capital structure does not rely on issuance of stocks alone, it utilizes debt financing to lower overall cost of capital, which increases our return to shareholders equity (Boone, L., Kurtz, D., & Qualman, E. (2011). The company's debt financing involves the following: Use of the extensive commercial paper program The extensive commercial paper program has been instrumental for Coca-Cola's cash management strategy. (Liu, J. (2013). It provides a low cost alternative to bank loans by providing an unsecured short-term debt to finance accounts payable, liabilities, and inventories. In 2009, Coca-Cola replaced a portion of its commercial paper and short term debt with longerterm debt, this impacted the offerings of long-term notes significantly in the principal amounts of almost $ 900 million at a rate of 3.6255 and $ 1,350 million at a rate of 4 .875%. To ensure these 11 ANALYSIS OF The COCA-COLA CORPORATION rates remain substantial Coca-Cola continues to evaluate their capital structure by reviewing their optimal mix of debt to keep their corporation growing. Exchanging of their common stock with other companies like CCE Coca-Cola Company entered into a definite agreement with CCE in 2010, to acquire all liabilities and assets of the CCEs North America operations. This merger would account for 34% of the company's current ownership interest involving CCE valued at 3.4 billion dollars. The current CCE shareowners were directed to trade their existing common stock for new stock within this entity. This stock exchange significantly benefited Coca-Cola by becoming the largest merging bottle operations in a national market. Analysis of access to Target Sources of External Financing The Coca-Cola stores a majority of its money in global subsidiaries which are among their main sources of external financing. This company has their own contingency plans that will enable them to access the kind of cash that is held by their international subsidiaries on a short notice. Based on the various reports concerning the Company's financial analysis, approximately $ 4.7 billion cash balances are available in liquid accounts and high cash investment accounts, as their target sources for external financing. In reference to the consolidation financial statements regarding the Coca-Cola Company there has been a steady increase in assets, liabilities, and owner's equity over the years. The company has not had to rely on credit facilities or backup lines of credit (Wardlaw, B. (2009). The company continues to monitor its financial stability. This company appears to have a strong financial standing and cash flow. If this company is ever in a position of not being able to meet their financial obligations they have the ability to seek funding through their bank partnerships. 12 ANALYSIS OF The COCA-COLA CORPORATION Coco-Cola did came under fire for its bottling operations in the late 1970s. Many developing countries face hefty clean water shortage such as India. The companies bottling plant in this country caused an adverse environmental impact. This caused India's Parliament to halt bottling operations and the sale of this product. This caused a major setback in meeting the demands of their consumers. In the 1990's, the company was able to gain entrance back into this market space to package, sell and distribute their beverage. Due to this country's population and geography it allowed them to gain more attention and market share to achieve long term financial stability. References Barham, B. (2012). Foreign direct investment in a strategically competitive environment: CocaCola, Belize, and the international citrus industry. World Development, 20(6), 841-857 http://dx.doi.org/10.1016/0305-750x(92)90055 13 ANALYSIS OF The COCA-COLA CORPORATION Boone, L., Kurtz, D., & Qualman, E. (2011). Contemporary business. Hoboken, NJ: Wiley Custom Learning Solutions. Coca-Cola Co. (KO) | Profitability. (2016). Stock Analysis on Net. Retrieved 31 July 2016, from https://www.stock-analysis-on.net/NYSE/Company/Coca-Cola-Co/Ratios/Profitability Coca-Cola Co. (KO) | Profitability. (2016). Stock Analysis on Net. Retrieved 31 July 2016, from https://www.stock-analysis-on.net/NYSE/Company/Coca-Cola-Co/Ratios/Profitability Hartogh, M. It's Still the Real Thing: A Profile of the Coca Cola Company. SSRN Electronic Journal. http://dx.doi.org/10.2139/ssrn.1030577 Ireland. Does coca-cola Use Technology to gain an advantage? Retrieved July 19, 2016, from Small busines: from http://smallbusiness.chron.com/cocacola-use-technology-to-gain-anadvantage-27339.html Kaneshige. (2015, May 22). Coca-cola finds innovation with start ups. Retrieved July 19, 2016, from CIO: http:www.cio.com/article/2925960/innovation/coca-cola-finds-innovation- with-start-ups Liu, J. (2013). Fixed investment, liquidity, and access to capital markets: New evidence.International Review Of Financial Analysis, 29, 189-201. http://dx.doi.org/10.1016/j.irfa.2012.12.002 Nasdaq. (2016). Coca-cola company (the) analyst. www.nasdaq.com/symbol/ko/earnings-growth Retrieved from Nasdaq.com: 14 ANALYSIS OF The COCA-COLA CORPORATION Wang, M. (2015). Brief Analysis of Sports Marketing Strategy Adopted by Coca Cola Company. Asian Social Science, 11(23). http://dx.doi.org/10.5539/ass.v11n23p22 Wardlaw, B. (2009). Got Gas? Mark Thomas Belches Out the Coca-Cola Company. Monthly Review, 61(7), 57. http://dx.doi.org/10.14452/mr-061-07-2009-11_7 15 ANALYSIS OF The COCA-COLA CORPORATION Appendix Table A-1 This table provides a detailed analysis on Coco-Cola's Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities 12 months ended Net income attributable to shareowners of The Coca-Cola Company (as reported) Add: Net unrealized gain (loss) on available-for-sale securities Net income attributable to shareowners of The Coca-Cola Company (adjusted) 31-Dec-15 7,351 31-Dec-14 7,098 31-Dec-13 8,584 31-Dec-12 9,019 -684 714 -80 178 6,667 7,812 8,504 9,197 https://www.stock-analysis-on.net/NYSE/Company/Coca-Cola-Co/Ratios/Profitability Table A-2 This table provides detailed information regarding Coco-Cola's profitability analysis. Return on Sales Gross profit margin Operating profit margin Net profit margin Return on Investment Return on equity (ROE) Return on assets (ROA) 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12 60.53% 61.11% 60.68% 60.32% 60.86% 19.70% 21.11% 21.83% 22.45% 21.82% 16.60% 15.43% 18.32% 18.78% 18.42% 28.77% 23.41% 25.88% 27.51% 27.10% 8.16% 7.71% 9.53% 10.47% 10.72% https://www.stock-analysis-on.net/NYSE/Company/Coca-Cola-Co/Ratios/Profitability THE CONSOLIDATION FINANCIAL STATEMENTS OF COCA-COLA COMPANY Annual Income Statement (values in 000's)Get Quarterly Data 16 ANALYSIS OF The COCA-COLA CORPORATION Period Ending: Tren 1/3/201 12/28/2 12/29/2 12/30/2 d 6 014 013 012 $55,498 $9,095 $11,761 $10,399 $0 $0 $0 $0 $236,62 $162,99 $138,59 $131,92 0 8 5 1 Inventory $89,464 $70,740 $61,987 $65,924 Other Current Assets $54,440 $44,168 $26,872 $33,068 Total Current Assets $436,0 $287,0 $239,2 $241,31 22 01 15 2 $0 $0 $0 $0 $565,96 $401,20 $351,97 $361,61 5 3 9 7 $117,95 $106,22 $102,04 $102,04 4 0 9 9 $663,98 $577,82 $524,35 $524,69 8 0 3 5 $66,887 $60,832 $58,560 $53,801 Current Assets Cash and Cash Equivalents Short-Term Investments Net Receivables Long-Term Assets Long-Term Investments Fixed Assets Goodwill Intangible Assets Other Assets 17 ANALYSIS OF The COCA-COLA CORPORATION Period Ending: Tren 1/3/201 12/28/2 12/29/2 12/30/2 d 6 014 013 012 $0 $0 $0 $0 $1,850, $1,433, $1,276, $1,283, 816 076 156 474 $319,49 $220,97 $182,87 $191,08 0 4 7 2 $7,063 $6,446 $25,939 $25,230 $0 $0 $0 $0 Total Current $326,5 $227,4 $208,8 $216,31 Liabilities 53 20 16 2 Long-Term Debt $672,60 $497,36 $437,61 $467,73 0 3 6 7 $382,28 $311,35 $216,39 $259,02 7 0 0 2 Deferred Liability $146,94 $140,00 $153,40 $140,96 Charges 4 0 8 5 Misc. Stocks $0 $0 $0 $0 Deferred Asset Charges Total Assets Current Liabilities Accounts Payable Short-Term Debt / Current Portion of Long-Term Debt Other Current Liabilities Other Liabilities 18 ANALYSIS OF The COCA-COLA CORPORATION Period Ending: Tren 1/3/201 12/28/2 12/29/2 12/30/2 d 6 014 013 012 Minority Interest $79,376 $73,334 $68,606 $64,179 Total Liabilities $1,607, $1,249, $1,084, $1,148, 760 467 836 215 Common Stocks $12,981 $12,960 $12,939 $12,919 Capital Surplus $113,06 $110,86 $108,94 $107,68 4 0 2 1 $260,67 $210,95 $188,86 $170,43 2 7 9 9 ($61,25 ($61,254 ($61,254 ($61,254 4) ) ) ) ($82,40 ($89,914 ($58,176 ($94,526 7) ) ) ) $243,0 $183,6 $191,3 $135,25 56 09 20 9 Total Liabilities & $1,850, $1,433, $1,276, $1,283, Equity 816 076 156 474 Stock Holders Equity Retained Earnings Treasury Stock Other Equity Total EquityStep by Step Solution
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