Business and the Business Emvironment- ASM 1

Coca Cola Vietnam''''s business environment is a fascinating subject. The thesis examines issues such as the micro-environment, macro-environment, and global environment. Along with it, there is an examination of the industry''''s evolution and an introduction to Vietnam''''s sub-sectors. Two Coca-Cola Vietnam competitors are also featured in this thesis, with basic data on the products and services they provide, their organizational structure, size, scope, and ability to achieve their vision, purpose, and business goals. These arguments will then be compared with Coca-Cola Vietnam. Finally, the paper examines Coca-Cola Vietnam''''s organizational structure to demonstrate how the internal marketing and finance departments collaborate to accomplish business goals and interrelationships.

Abstract

Coca Cola Vietnam's business environment is a fascinating subject The thesis examines issues such as the micro-environment, macro-environment, and global environment Along with it, there is an examination of the industry's evolution and

an introduction to Vietnam's sub-sectors Two Coca-Cola Vietnam competitors are also featured in this thesis, with basic data on the products and services they provide, their organizational structure, size, scope, and ability to achieve their vision, purpose, and business goals These arguments will then be compared with Coca-Cola Vietnam Finally, the paper examines Coca-Cola Vietnam's organizational structure to demonstrate how the internal marketing and finance departments collaborate to accomplish business goals and interrelationships.

Table of content

I Introduction to Coca- Cola Vietnam

Coca Cola first appeared in 1886, with its headquarters in the United States, and is asymbol of American culinary culture Currently, Coca Cola has been present in more than

200 countries around the world, and is known by about 98% of the world's population( Tạp chí Pháp Lý, 2021) Dr John S Pemberton, an Atlanta pharmacist, came up with aunique tasting soft drink that could be served at soda fountains in 1886 He made aflavored syrup and carried it to his local pharmacy to be combined with carbonated waterand judged "wonderful" by people who tried it Frank M Robinson is credited withnaming the beverage "Coca-Cola" and creating the patented, distinctive lettering that isstill used today( Coca- Cola company, 2021)

( Source: Le, 2019)There are 4 types of legal structure for Business Firstly, Proprietorship- A business ownedand managed by one person is known as a sole proprietorship, or proprietorship, and theowner-manager is the proprietor Secondly, Partnership- legally owned by two or morepeople; common examples include skilled people and professionals such as: dentist,lawyers…Thirly, Private limited company is owned by shareholders who are typically thedirectors of the business, and cannot be offered to the general public, incorporated Finally,Public limited company is owned by shareholders and run by director limited liability, andoften referred to as a PLC Coca- Cola Vietnam is a private limited company

Coca Cola in general and Coca-Cola Vietnam in particular both own a large portfolio ofother beverage brands, including Schweppes, Oasis, 5 Lives, Kea Oar, Fanta, Lilt, DrPepper, Sprite and PowerAde, and are one of the globally recognized brands Coca-Cola'sannual revenue in Vietnam has increased by trillions of dong, and in 2015, Coca-Cola had

a 48.6 percent market share in Vietnam ( Nguyen, 2020) Coca-Cola still believes itsmission is to innovate and make a difference for the world For Coca-Cola's vision, the

physically and mentally At the same time, to develop in a sustainable way and towards abetter common future, bringing positive effects in the lives of people, communities, andthe whole world (The Coca-Cola Company, 2021).

In term of scope and size, there are two types of organizations: for-profit and non-profit

For-profit organizations are organized and operated for the benefit of the collective, public, or public benefit society Non-profit organizations are organized and operated for

the benefit of the collective, public, or public benefit society Coca-Cola Vietnam belongs

to a for-profit organization In terms of size- defined as the number of employees at anyparticular geographical location is known as organizational size, and it includes thecomplete corporate organization whether it is at one geographical place or a division of adecentralized firm, coca cola Vietnam is a large business with a huge number of humanresources, about 4000 employees and 99% are Vietnamese in Vietnam ( Thị trường - BáoNgười lao động online, 2019)

Coca-Cola arrived in Vietnam for the first time in 1960 Following that, in August 1995,the Coca-Cola Indochina Pte Company was formally founded in Vietnam Since then,Coca-Cola has a presence in Vietnam, which has been consolidated into a single beveragecompany known as Coca-Cola Vietnam, with headquarters in Ho Chi Minh City's Thu DucDistrict

II Coca- Cola- business environment

1 The development of the beverage industry

Coca-Cola has always been one of the most well-known beverage brands in Vietnam.Thousands of direct and indirect jobs have been generated by Coca-Cola factories in HoChi Minh City, Da Nang, and Hanoi Coca-Cola has been continually innovating and

developing its goods for many years in order to diversify its consumer base Coca-ColaVietnam, in particular, significantly broadened its high-quality product range in 2017 bymarketing juice goods, packaged tea, and canned coffee.

2 Beverage industry

There are three sectors in the organization's idea The private sector refers to the segment

of the economy in which private persons or organizations own and govern theorganization, with profit as the primary motivation The government and its institutionscontrol the public sector, where the strafe develops and operates many sorts oforganizations for the benefit of its citizens and their general welfare Not-for-profit andnon-governmental organizations such as charities, purposeful bodies, and communitybusinesses comprise the volunteer sector Coca-Cola Vietnam, a firm that provides theessential product of beverages as well as a diverse range of products, is a tailor-madecorporation that functions practically profitably Profit and revenue generation are at theheart of any business plan This demonstrates that Coca-Cola Vietnam is a privately ownedcompany

2.1 Porter’s five forces of Coca- Cola Vietnam

The five forces mentioned in Porter's model can have an impact on Coca- Cola's to servicecustomers and generate a profit in Vietnam

The threat of new entrants

In Vietnam, Coca-Cola will be able to exploit existing expertise and money flows to shake

up the competition, even while new entrants diversify from completely diverse industriesinto the main business

There are several entry hurdles for new entrants that favor Coca-Cola: capitalrequirements, economies of scale, product differentiation, access to distribution, andcustomer loyalty to established brands.

The threat of substitute products or services

These alternatives can be direct or indirect: direct substitutes are items from the samecategory produced by several competitors; indirect substitutes are products from manyproduct categories (Boyce, 2021) that can be used to replace Coca-Cola in Vietnam The cost of switching to direct substitutes is not high for the consumer, moreover the priceper unit-volume may be higher or lower, thus making the risk of substitution high

There are some distinctions in how comparable or identical goods are utilized from theuser's perspective, however many consumer decisions are based on personal preference,making Coca-Cola vulnerable to replacement products

Bargaining Power of Buyers

Cola customers in Vietnam appear to be a group of consumers who purchase Cola products in Vietnam for distribution, retail, or consumption The primary customers

Coca-of Coca-Cola in Vietnam are hypermarkets and supermarkets, as well as independentretailers and distribution agencies for end consumers Buyers' purchasing power will beincreased through a system of supermarkets, hypermarkets, and a number of specializedfood chains Coca-Cola keeps products on hand for purchasers, and shops in Vietnamhelped to meet consumer demand

Bargaining Power of Suppliers

Coca-Cola Vietnam has the highest share of the food and beverage market, with the mostsupply chains As a result, it is a typical buyer for suppliers No supplier discloses any cost

requirements, and bargaining leverage is similarly limited However, Coca-Cola Vietnam

is also interested in its suppliers because they believe in long-term partnerships

2.2 Macro environment and Micro environment of Coca- Cola Vietnam

2.2.1 Macro environment

Coca-PESTEL Cola's study in Vietnam will assist the corporation in making appropriatestrategic decisions that are in accordance with external trends and factors of the externalenvironment (macro environment) so that the beverage sector may grow and succeed

Political environment

Commercial constraints and political stability are other important elements that will decideCoca-success Cola's or failure in Vietnam Coca-cost Cola's of doing business in Vietnamwill be influenced by tax policies An rise in organizational taxes (on business earnings)has the same effect as an increase in costs Companies can pass some of this increase on tocustomers in the form of higher prices, but it will also have an impact on the company'sbottom line A country's lack of political stability has an influence on corporate tasks.Political stability is especially important for firms that operate on a worldwide scale, such

as Coca-Cola in Vietnam

Economic environment

Economic factor is one of the most important factors of PESTEL affecting Coca-Cola inVietnam

(Source: Globalvn.biz, 2021) The chart above shows how Coca-Cola in Vietnam has grown from 20016 to 2019 Coca-income Cola's in 2016 was VND 6,872 billion, which climbed by VND 346 billion toVND 7,218 billion in 2017 According to the most recent data, Coca-Cola Vietnam'srevenue in 2019 was VND 9,297 billion, a 9 percent increase over the previous year.Successful economic growth will lead to increased customer spending, the potential forlarge profits, and the ability to expand the company's production and commercialactivities.

A moderate inflation rate will also help Coca-Cola Vietnam develop and have a positiveeffect on improving consumer confidence and consumer spending trends The pace of

inflation can influence the demand for Coca-Cola products in Vietnam However, higherinflation could force Vietnam Coca-Cola to raise prices alongside inflation, leading toreduced brand loyalty and persistent cost-cutting efforts.

Social

Social influences will derive from social components of the macro environment such asconsumer behavior and needs as well as social trends in education Higher education socialtrends have enabled corporations such as Coca-Cola in Vietnam to acquire more competenthuman personnel Furthermore, Coca-Cola in Vietnam is supposed to prioritize consumersabove products

Technology environment

With the progress of science and technology along with scientific inventions, this has madeCoca-Cola's new products perfected continuously Many new technologies havetransformed and created a radical substitute for traditional products, and it makes Coca-Cola Vietnam company very competitive, especially in terms of technological progress.Coca-Cola used the Internet as well as social media to reach consumers Businesses inVietnam, such as Coca-Cola, have begun to use social media for recruiting, highlightingthe shift in the business world toward social networking

Environmental.

In terms of environmental effect, Vietnam strives for ecologically benign operations,energy conservation, and natural sediment conservation It is becoming increasinglydifficult to verify whether the materials used are recyclable as more and more products aremanufactured

Suppliers: Individuals or organizations that offer inputs to an organization are known as

suppliers Some raw ingredients used in the production of Coke do not appear to beaccessible in Vietnam, thus they must be imported from elsewhere A marketingmanagement contract's job is to ensure that suppliers comply with purchase orders for rawmaterials and to keep track of pricing fluctuations Suppliers for Coca-Cola Vietnam suchas: Dynaplast packaging (Vietnam) Co., Ltd., Stepan Processing Company and KCP SugarFactory ( Hoang, 2020)

Customers: In the business environment, customers are always the top priority for all

businesses, not just Coca-Cola Coca-Cola Vietnam always considers customers as god.They embrace a variety of strategies for reaching consumers Lots of promotions, andexciting customer-centric activities

Competitors: Coca-rivals Cola's are classified as either direct competitors or prospective

competitors Direct rivals are companies who have been in the sector for a long time andhave an impact on Coca-business, Cola's such as Pepsi, Red Bull, and Tan Hiep Phat.Businesses specialized in alternative goods such as coffee, milk, beer, or bottled water areprospective rivals, but their potential is insufficient to compete directly with beveragecompanies such as Coca-Cola

Scarcity of raw materials: Because raw materials are becoming increasingly limited,efficient recycling of soft drink cans is required for beverage goods in the industry.

Energy costs are increasing day by day: Coca-Cola must develop new alternative energysources, operate more effectively, and reduce manufacturing costs

III Analysics of 2 competitors of Coca- Cola Vietnam- Pepsico and Tan Hiep Phat

1 Background of Pepsico and Tan Hiep Phat

PepsiCo formally entered the Vietnamese

market in 1994, when it formed a joint

venture with IBC International Beverage

Company and introduced the first two

brands, Pepsi and 7 Up, following the

lifting of the US embargo against Vietnam

(Suntory PepsiCo, 2018) This company

owns numerous other well-known

beverage brands, including Mirinda, 7 UP,

Mountain Dew, and Aquafina mineral

water, in addition to the billion-dollar

Pepsi brand ( Pepsico, 2021)

Tan Hiep Phat, the forerunner of BenThanh Brewery and Beverage Factory, wasfounded in 1994 with the purpose ofproducing and trading alcohol, beer, andother beverages The head office, which islocated in the Thuan An district of BinhDuong province, features a plant with afloor area of more than 110,000m2 andsome of Southeast Asia's most advancedequipment, research, and manufacturingtechnology lines ( Vnr500, 2021)

2.Products and Services

Pepsico company owns numerous other

well-known beverage brands, including

Mirinda, 7 UP, Mountain Dew, and

Aquafina mineral water, in addition to

the billion-dollar Pepsi brand ( Pepsico,

2021) Pepsi goods flourish in a growing

culture where individuals are often

preoccupied with their jobs and limited

time, therefore fast food and

accompanying carbonated beverages

such as Pepsi are popular In order to

grow the market, Pepsico has also

created a diet-specific Pepsi Pepsi has

Tan Hiep Phat's products include herbaltea, green tea, squash tea, exercise drink,energy drink, soy milk and purifiedwater

Tan Hiep Phat's products haveconsistently won the title of "VietnameseHigh Quality Goods" as voted byconsumers, as well as being honored as aNational Brand and receiving numerousother prestigious awards Tan Hiep Phat'sproducts are widely trusted due to theassurance of quality management,environmental protection, and integrated