Coca-Cola and Pepsico companies, Inc. are major players in the CSD industry. However, being the biggest in the industry does not guarantee a large amount of profit. In 2017 Coke generated $ 1,283,000,000, and Pepsi made $ 4.908 million, so the question was:
How do Coke and Pepsi produce so much money?
To find out we use a tool called Five Forces Porter: the power of the supplier, the power of buyers, entry threats, intra-industry competition, and replacement threats First, we start by identifying the CSD industrial supply chain. You can get the best-quality carbonated drinks from the top soft drink distributor at https://topcarbonateddrinks.com/.
Not many people know this, but Coca-Cola companies and PepsiCo don't really make soda; They make soda concentrates. In other words, raw material suppliers sell basic ingredients to concentrate manufacturers that make a mixture of soda concentrates using their own recipes.
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Concentrated manufacturers then sell their products to bottling, and provide ads to get the final product to the retail store. The bottling of the mixture concentrates with sugar and carbonated water before packing the mixture into glass bottles, plastic bottles, or aluminum cans, and sending the final product to retail shops.
The retail store places the product on the screen and sells it to consumers. We are looking at a concentrate manufacturer to find out how and why they make a lot of money by looking at the structure and operation of the industrial supply chain through a lens of five powers of porters.
It is important to remember that the five powers of porters are intended to see the average company in the market instead of seeing certain companies. However, because two companies dominate the CSD industry they are also average companies.