Threat of new entrants In the porter’s five forces‚ threat of new entrants refers to the threat of new competitors pose to existing competitors in an industry. A profitable industry will attract more competitors looking to achieve profits and If it’s easy for these new entrants to enter the market‚ if entry barriers are low this poses a threat to the firms already competing in that market. More competition or increased production capacity without the concurrent increase in the consumer demand
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Threat of new entrants – 1. Low capital requirements to entry 2. Sufficient suppliers to support new entrants: a fragmented industry means there are sufficient suppliers for new entrants to “discover” to build relationships with‚ and even Winestyr’s existing customers would probably want to build additional distribution channels 3. Easy for existing brick and mortar sellers to enter as they already have a customer base and are likely to have industry/regulation knowledge as well Bargaining Power
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Threat Of New Entrants A major force shaping competition within an industry is the threat of new entrants. The threat of new entrants is a function of both barriers to entry and the reaction from existing competitors. There are several types of entry barriers: Economies of scale. Economies of scale act as barrier to entry by requiring the entrant to come on large scale‚ risking strong reaction from existing competitors‚ or alternatively to come in on a small scale accepting a cost disadvantage. Economies
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Threat of New Entrants: Barriers to Entry Economies of scale Product differentiation Capital requirements Switching costs Access to distribution channels Cost disadvantages independent of scale Government policy Expected retaliation Barriers to Entry Economies of Scale Marginal improvements in efficiency that a firm experiences as it incrementally increases its size Factors (advantages and disadvantages) related to large- and small-scale entry Flexibility
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PepsiCo Inc.‚ profitability ratios | | | Dec 29‚ 2012 | Dec 31‚ 2011 | Dec 25‚ 2010 | Dec 26‚ 2009 | Dec 27‚ 2008 | Return on Sales | | Gross profit margin | 52.22% | 52.49% | 54.05% | 53.51% | 52.95% | Operating profit margin | 13.91% | 14.48% | 14.41% | 18.61% | 16.09% | Net profit margin | 9.43% | 9.69% | 10.93% | 13.75% | 11.89% | Return on Investment | | | | | | Return on equity (ROE) | 27.71% | 31.29% | 29.86% | 35.38% | 42.47% | Return on assets (ROA) | 8.28%
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COMPANY CASE BRITIVIC : CREATING A BRAND FLAVOUR Selected britvic brand : Questions for discussion: 1. core benefit of pepsi : A drink for refreshment without alcohol. Actual product of pepsi: • brand name: pepsi • quality level: excellent • design n packaging: regular (275ml)‚ disposable (500ml)‚ can (300ml)‚ regular (1 liter)‚ disposable (1.5 liter)‚ jumbo (2.5liter). • features : black colour with
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Compete in India History Background Coke and Pepsi Learn to Compete in India Case Summary Indian softdrinks Market Six product segments-Economic crisis of 1991 leaving consumers with little choice of brands -1986 “Pepsi Foods Ltd.” “Lehar Pepsi” -1990 Coca-Cola Reenters market with joint venture “Britco Foods” -Later partner with Parle Advertising Pepsi and Coke sponsor TV campaigns‚ Urban Youth‚ Cultural Festivals and Sports Fans. Both Pepsi and Coke look to expand into other markets (fruit
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Introduction Coca-Cola and Pepsi are the two greatest competitors in the soft drink industry. A brief introduction and history of the two companies will provide a basis for understanding how the companies have come to be where they are today and how they run their companies. The company structure of each will also be briefly explained to provide an understanding of how management style is impacted. Marketing and Advertising The marketing skills that these companies possess are the reason both Coca-Cola
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“Comparison of Marketing Mix for Coca Cola and PepsiCo” Acknowledgement I owe a great many thanks to a great many people who helped and supported me during the writing of this book. My deepest thanks to Lecturer .................... The Guide of the project‚ for guiding and correcting various documents of us with attention and care. He has taken pain to go through the project and make necessary correction as and when needed. I would also thank my Institution and my faculty members without whom
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Coca-Cola 1. Promotion: Coke has many different and unique ways that they promote their brand that makes their company so successful. They have taken promotion to a whole new level by creating the vending machine to sell to people on the go‚ created santa clause so people would drink their product during summer‚ they also put a lot of money into having their commercials playing during big events such as the super bowl from 2009 to 2013‚ coke has spent 62.3 million dollars on adds during the super
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