Tag Archives: Coca-Cola

Climate Change Non-Issue for Business Schools

NASA 16-008 – January 20, 2016 – 2015 Global Temperatures . Picture courtesy of NASA Scientific Visualization Studio.

Despite the fact that climate change has enormous economic consequences, only a handful of US business schools which allow students to focus their studies on sustainability.

Recent closures of facilities owned by Nestle and Coca-Cola, as well as an imminent coffee shortages on the horizon, which will disrupt companies like Starbucks, has still not sent the message to business schools that climate change is an issue that needs addressing by the business community.

Climate change affects every resource used by business: agriculture, water, land, energy, and workers and the economy. No business will be immune from the transformation caused by climate change. Some observers believe that without radical change in our business models climate change will lead to disastrous consequences.

The scientific consensus is that the best way to avoid disaster is to keep the average global temperature increase to only 2 degrees Celsius. In order to reach this goal emissions of greenhouse gases need to be limited to 1 trillion metric tons which will mean a 49 to 72 percent reduction globally from 2010 levels.

Clearly business needs to take a leading role in the reduction of gases that contribute to climate change, but the schools that are educating our future entrepreneurs and business leaders are not taking the issue seriously enough.

One study looked at 51 schools out of the hundreds in the country. It found that when a sustainable business course is offered, it is usually just an elective. Just a few business schools offer minors, majors, certificates or graduate degrees in sustainability business and /or management.

The 51 schools that were chosen for the study are leaders in the study of sustainability. The vast majority of schools do not offer any kind of coursework on the subject. The study showed that even the best schools for sustainability are doing a bad job preparing students for the future that is coming.

Nestea to Be Phased Out in US Market

A joint statement issued by Coca-Cola Company and Nestlé announced that they will be

Nestea Iced Tea

refocusing their efforts selling their soft drink known as Nestea, which is now sold as a partnership between the two companies.

By the end of the year 2012, the statement said, the emphasis of their joint venture Beverage Partners Worldwide (BPW) will be in Europe and Canada, where they hope to sell more of their ready-to-drink tea.

Coca-Cola, based in Atlanta, will sign an agreement with Nestlé for the rights to market the Nestea brand in Taiwan and Hong Kong. Everywhere else the BPW Company will be shut-down.

“Both partners believe a concentrated focus on Europe and Canada will accelerate the growth and bolster the market presence of BPW where the joint venture is most effective,” read the statement.

Coke Adds Financial Stability

Once the Coca Cola advertising slogan was “Coke Adds Life.” For those looking for long term stability Coca Cola adds stability, dividends and profits. First of all, Coke gives a dividend of 3% per year which is certainly better than the current 2% for ten year treasury bonds. Also, the price of Coke stock has been rising over the last 5 years, even though it was brought down temporarily by the market drop in 2009 when it dropped to $40. Since then it has risen to $68 even with the recent market volatility.

Indeed, Coca Cola is a giant company which operates worldwide. Now they are planning to invest $3 billion into the Russian market and $4 billion into the Chinese market. Because the company is so big, I believe that the risk of investing in this company is limited. People have been drinking cola for a hundred years and will continue. Also, we see that the management has the skills to remain profitable. One of Coca Cola’s former executives, Segun Ogunsanya, started as an accountant in Ghana and was developed by the company until he become the manager of the whole area. He recently left the company to become the CEO of an African beverage manufacturer. It just shows that these large companies know how to develop management to ensure their success.

Their 50-day moving average is 68.34 and their 200-day moving average is 67.62. The stock is trading at 68.19 which is good for a down market. The companies trailing P/E is 12.54 which shows that the company is reasonably priced in relation to its earnings.

All stocks should be thoroughly analyzed before being purchased and should not be purchased on hearsay.

Coca-Cola Conquest

Coca-Cola just reported a rise in profit of 18 percent, rendering their profit margin to $2.8bn in the second quarter, as compared to last year.  The demand from China for the beverage went up to 24 percent.  Sales of the carbonated beverage also escalated somewhat in Europe.

At the same time however, what might be a tad surprising (and disappointing) to Coca-Cola consumers, is the fact that according to a recent BBC news article, the company is planning on elevating prices on its drinks “to reflect higher costs” it has been incurring.  Fanta and Sprite will also be included in this price change that will result in a 3 to 4 percent addition.

Coca-Cola Growth Targets

More good news for Coca-Cola came in a statement from Muhtar Kent, the company’s Chairman and Chief Executive.  He said that the company’s results were “well ahead of [its] long-term growth targets.”  He added that the company was “delivering these strong results at a time when global macroeconomic conditions are at best mixed.”  This is great news for the company.

US Slowdown

North American sales of Coca-Cola have dropped somewhat, possibly since the predictions for “US consumer demand remains uncertain amid a weak labor market.”  Further, volatility encountered in commodity markets has been seen as a possible reason for the continuation of increasing prices for both packaging and sweeteners.  Coca-Cola thus feels its own pricing must reflect this.

Coke-Changing Colors

Get Ready Canada

In Canada, Coca-Cola is going through a change. It is getting being prepped for summer with its new colored cans.  According to a recent article in Marketing Mag this move began a couple of weeks ago and has the cans being sold with a cool “thermosensitive ink” which reacts when the temperature of the can is “cold enough to drink.”

According to the beverage’s Quebec brand’s marketing manager, Denis Fertlatte, the reason for this new marketing strategy is as follows:  “The summer season is very important for both the soft drink and beer industries. We need to stand out and innovate to grab consumers’ attention and interest. Moreover, summer, with its warm and sunny weather, is the time to focus on the refreshing aspect of our product. So we came up with this new can.”

Coca-Cola Copy Cat?

There has been however, some slight criticism about the move; that this strategy has been used by other beverages already. But Ferlatte argued that even though the same technique was indeed being used he insisted that Coca-Cola Canada was “neither in the same category or targeting the same clientele, so we’re not worried about the comparison.”

This cool idea is to be found on a 335 ml can of coke in which a “white class Coke bottle turns red when the liquid reaches 8 degrees Celsius.”  But get in there fast since these will only be for sale until Labour Day.