9 terms

Globalisation - TNC: Coca Cola

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Background Information
(4 points)
- Coca Cola is sold in more than 200 countries
- It is the number one manufacture of soft drinks in the world
- Their headquarters are situated in Atlanta, USA
- 70% of its sales are generated outside the USA
- Coca Cola is manufactured in 44 different countries
Growth
(6 points)
- The soft drink was first sold in Jacob's Pharmacy in Atlanta on May 8th, 1886. By 1985, Asa Griggs Candler (the owner) had built syrup plants in Chicago, Dallas and Los Angeles
- The Coca Cola company grew rapidly as it moved to other countries such as Canada, Cuba and France
- In 1900 there were two bottlers of Coca Cola; by 1920 there were about 1000
- Expansion overseas took place in 1923 and 1928 when Coca Cola was introduced to the Olympic games with the US team.
- The company still support many sport associations e.g. FIFA, NBA, Rugby World Cup, Olympics
- 70 years of success with one brand then expanded to new flavours e.g. Fanta and Sprite
Spatial Organisation
(5 points)
- The Coca Cola Europe group employs approximately 70,000 people.
- Coca Cola don't always own their factories - they subcontract them with other companies to save money
- Coca Cola manufactures their drink concentrate in America
- Bottlers but the concentrate from the Coca Cola company - it is then mixed with water and sweatened before bottling the finished product
- Coca cola wants to have access to high earning large populations such as India, by manufacturing their goods close to their market = save money on transport
Positive social impacts
(3 points)
- Coca Cola offers training and education to those who have recieved little already
- Joined forces with celebrities and natioanl events to spread the importance of recycling for a sustainable furture
- Run community schemes in LEDCs e.g. the 'empowering 5 million women entrepreneurs by 2020'
Negative social impacts
(4 points)
- Working conditions in the bottling firms can be very harsh and those in tropical countries are without air conditioning facilities
- The workers have very poor pay and do not receive benefits meaning they have to pay for health treatment from their low pay (10$ a day)
- Charges of murder, rape and torture of union leaders and their families against Coca Cola and co in Guatemala = corrupt
- In Rajistan, Northern India, Coke have lowered the water table, leaving the area dry and farmers having to shut farms
Positive economic impacts
(3 points)
- Coca Cola have invested $1.5 billion in the Russian economy, this includes the constructing of manufacturing plants and improving infrastructure
- Many of the bottling firms are local companies so all profit stays in the host country
- Created many jobs in LEDCs e.g. the $200 million bottling plant in Burma = 22,000 jobs
Negative economic impacts
(3 points)
- LEDCs rely too much on Coca Cola who could just leave suddenly = unemployment
- Profits return to share holders = very little of the money remains in host countries (economic leakage)
- LEDC workers work long hours for very little pay - $10 per day
Positive environmental impacts
(2 points)
- Coca Cola Africa Foundation is providing at least 2 million people across Africa with safe water by 2015 - they also fund projects to improve sanitation and hygiene
- 85% products are in recyclable bottles and cans
Negative environmental impacts
(1 point)
Depletion of the local ground water due to the utilisation of natural water resourced by the company pose serious threat to many communities. In March 2004, local offices in Kerala, india shut down a $16 million coke bottling plant blamed for the drastic decline in both quantity and quality of water available for locals.