MGT 30220 Study Guide - Final Guide: Cola Wars, Vertical Integration
Strategic Management Study Guide
• Five Forces Analysis:
o 1.Barriers to Entry: HIGH
▪ Marketing / branding / advertising / brand identity = takes time and a lot of
money to build
▪ Distribution scale =
• large so takes a while to establish large economies of scale
▪ Product development / R and D costs / legal barriers
▪ Sponsorships / jobs with sporting events / restaurants
▪ Distribution relationships
• limitations on the amount of shelf space in stores
o 2. Threat of Substitutes: WEAK
▪ Potential substitutes = milk, water, wine, energy drinks, coffee, beer, etc.
▪ A lot of substitutes, so puts a cap on profitability, but not necessarily the case
in this industry
▪ Big players have a piece in amongst every substitute
o 3. Power of Suppliers:
▪ Commodities
▪ Decreased concentration
▪ decreased differentiation
o 4. Power of Buyers:
▪ Demand driven industry because end users are pulling through channels
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