Supplierpower: In the UK, the country’s industries is determined on howeasy for their suppliers to increase their prices. The UK also work on how many potentialsuppliers they have, how unique is the product or service that they provide andhow expensive it would be for the UK’s industries to switch from one supplierto the other. This is beneficial for Coca-Cola when the company wants to tradein the UK because the company can also structure how it is going to besatisfying its suppliers in order to build a good relationship with them andmost importantly on how to ensure that the suppliers do not increase theirprice.
This is because suppliers are a big factor in the success of a business.An advantage Coca-Cola can get with suppliers is that the more the company hasto choose from, the easier it will be for Coca-Cola to switch to a cheaperalternative. However, if Coca-Cola gets suppliers that have a strong positionthey have the ability to charge the company more and it could impact thecompany’s profit.Buyer power: Buyerpower is very important in the UK because with buyers the country is alwaysworking on how to satisfy them even more because they are the backbone to allof the businesses in the UK. This is what Coca-Cola have to work hard to getwhen the company trades in the UK because if the company deals with fewcustomers, they have more power for example, they have the power to go to CocaCola’s competitors to get the product or service they want. But Coca Cola’spower will start increasing in the UK when they have a huge customer base.
Competitiverivalry: The UK looks at the number and strength of its industries’competitors, how many rivals they have, who are they and how does the qualityof their products and services compare with theirs (the UK’s). This is good forCoca-Cola because when they see their competitors like Dr Pepper Snapple Groupor Nestlé is ahead of them a bit, then they tighten up their seatbelt to bebetter than before. In this case, the intense competition motivates Coca-Colato work harder. It is important for Coca-Cola to do this because in marketswith many rivals, Coca Cola’s buyers and suppliers can go elsewhere if theyfeel like they are not getting a good deal from the company.Threat ofsubstitution: This refers to the likelihood of UK’s customers finding adoing what UK does.
For instance, instead of people buying a can of coke, wateris a suitable alternative to coke. Moreover, water is heathier than coke. Thisa very big threat to Coca-Cola because nowadays, people are starting to realisethat coke is unhealthy – which means that Coca-Cola could possibly start losingprofit and lose to its competitors.Threat ofnew entry: Coca-Cola’s position can be affected by people’s ability toenter the company’s market. If Coca-Cola had little protection for their keytechnologies, then their rivals could have quickly entered Coca-Cola’s marketand weaken the company’s position. But luckily Coca-Cola had a strong anddurable barriers to entry, then they were able to preserve a favourableposition and took advantage of it.