Michael Porter’s article discusses strategies on competitive advantage and profitability to be used in the market. Market or else competitive environment and successful position in it requires competitive advantage. Basically what that means is for company being positioned in the marked faster than competitive companies and this also requires strategy. Value. Company must create value by activities as Porter identified as a value chain. Competitive advantage generates when company delivers benefits for its customers may be same as other companies but for example for lover cost or they deliver better advantages. This actually allows company to establish higher value for customers and higher profits for company. Regarding to operations of logistics the Pepsi and Coca Cola possess are similar or same. They have their own ingredients, which they purchase based on contracts and in their own facilities then they produce their own concentrate. As a follow on operations they ship their concentrate to bottlers where they use bottling company. Bottling company after they receive the concentration, they add correct amount of sugar, carbonated water and mix it to the correct concentration and than they bottle it for sale. Commonly these companies have contracted as less as possible bottling companies. This was basically done in order for bottlers to meet the concentrate producers demand and also to decrease shipping prices, and better ability for delivery. There are two important reasons for this procedure. Protection of their well-kept secret and which is particular mix of ingredients and protect the secret from bottlers that what exactly goes into their product. This protects high value of it, which also supports the image of the product. For Pepsi and Coca Cola this also represents a sense of prestige to the other products with its excellent secrets. Â Â Cash registers technology and its automation allow Pepsi and Coke and bottling company to know exactly what amount of their product each element possesses. This strategy also allows sellers to sell more products and makes easy delivery of it in smooth timely procedure. Rareness. The rareness of a specific resource depends describes combination of physical rareness/uniqueness in the market or the rareness of the value of the resource caused by firm’s particular resource combination. Coca cola used to be one of the top companies over other soft drinks and has come up with many different types of favor at the inception of the business that would include sport drinks, bottled water and teas. Now both Coca cola and Pepsi with the constant growing allow now other vendors to contact in and have some opportunities to be a part of the companies. In regard to rareness the only rare component is the syrup that is artificial by the main corporations, which is then sold to the rest of the vendors. Coca-Cola and Pepsi used numerous technologies in order to achieve rise to the top of the soft drink industry, and they also defined new technologies and established paradigms that popped the status quo like a cap from a soda bottle.
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