With economic growth many opportunities have been

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With economic growth many opportunities have been seen, which have attracted many foreign investor to the company. Coca cola India returned to the country in 1993, despite few problems in the start they have emerged as the king of soft drink industry in India. The strong economic growth of India has resulted in coca cola to invest heavily in sales and distributive channels. It has introduced two new products, Nimbu Fresh and an energy drink ‘Burn’. Coca cola registered 22% growth in their unit case volume in the second quarter (April-June). It is the 16 th consecutive quarter of such growth out of which 13 are double digit. Coca cola Page 52
“Project Report on Coca-Cola Company and study of customer preference for Coca-Cola brands with reference to Coca-Cola India” India’s growth is in contrast to its overall performance, the beverage king reported a growth of just 5% (worldwide) in the same quarter. Inflationary effects Inflation is one of the main problems that Indian economy has been facing for a year now. Rising prices in the food and other products doesn’t only effect the consumers it also has an adverse effect on a company. The inflation rate for the year 2009 was recorded to be 11.49%. As prices have gone up in India for various products, especially oil, there has been uncertainty in decision making of almost every company. Coca cola India has also been affected by the same; it has been forced to think about their input costs, as they have been rising due to inflation. Their expenditure has been rising, with more costs in salaries, distribution channels and other operating costs. Beverage industry being price competitive market, they have not revised their product prices. Exchange rate The exchange rate of rupee to US Dollar has been stable but in the previous months the rate has had a tumultuous period. Exchange rate determines at what price will the company export its products and import whatever is required by it. The previous year, the rate of rupee to USD touched 44, on an average it has been around 47, so the exports earned less and the imports cost more. Therefore, coca cola India had to bear some low profitable times. However, in the present scenario rates have reached a stable level and exports are on an increasing trend. Social Analysis: Coca- Cola returned to India in 1993 after a 16 year hiatus, amidst competition from Leher Pepsi which had the advantage of entering the country 7 years earlier. Initially, it struggled to find acceptance as there were already other brands such as Parle’s Thums Up which existed in the market. Coca-Cola had earlier focussed more on the American way of life in their advertising campaigns, which the Indian consumers could not identify with. Also, they did not focus on competition from other alternatives such as lemonade, Lassi etc.

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