Porters Analysis on the Soft Drink Industry Free Essay, Term Paper and Book Report
Porters Five Forces Analysis of the North American Soft Drink Industry
I. Power of Suppliers
Supplier Concentration:
In the soft drink industry, there is a small number of suppliers. Although there is a large number of establishments, 316 in 1999 according to the Business Register, there are four main companies that supply the industry. Most popular brands of soft drinks are
produced by these four companies. For example, the supplier with the largest current market share is the British manufacturer, Cadbury Schweppes, which produces soft drinks such as Dr. Pepper, 7-Up, A&W, RC Cola, Snapple, Sunkist, Canada Dry, Hawaiian Punch among other popular brands. There are also very few niche operators. This gives the suppliers an advantage.
Switching Costs:
Switching costs are practically non-existent for buyers. Many buyers have contracts with one of the major suppliers, but aside from that, there is no real switching cost. Whether the buyer is dealing with canned, bottled or fountain soft drinks, it is extremely easy and cheap to switch between buyers, give......
Word Count: 2059
Page Count: 8.2 (250 words a page / double spaced)
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