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Question : Prepare a Report on Soft Drink Manufacturing in Australia ?

Answer : Executive Summary

The entire report would be based on the drinks industry of Australia which has been deteriorating in the past few years because of the health consciousness of the people. The purpose of the report is to acknowledge and present all the possible ingredients or the factors which has been impacting the downfall of the soft drinks industry and this would be done through exploring the economic, technological, political, customer landscape, market segmentation and many more other factors. The report has acknowledged the macro environment through understanding the political, economic, political, legal and regulatory and many other factors. The political and the technological factors has been favouring the industry through providing wide scope of business. The other factors has been unfavourable for the business. The micro environmental analysis has focused on the market share which has been quite high in the concerned industry and the customer landscape and market segmentation which represents that the health oriented people would not favour the soft drinks and the school going children would be attracted to t This has been followed with a recommendation that the school going children should be focused on by the industry.

Introduction

The report would concentrate on the soft drinks industry in Australia which would help in understanding the downfall of the industry in the past five years. The exploration of the environment would be done through both the macro and the micro perspectives as this would help in understanding the reason behind the downfall on a wide scope as well as on the minor scope. The purpose of the report is to acknowledge and present all the possible ingredients or the factors which has been impacting the downfall of the soft drinks industry and this would be done through exploring the economic, technological, political, customer landscape, market segmentation and many more other factors. Though all these factors has not been against the concerned industry, there has been some or the other contribution of these factors in the downfall. On understanding the factors and the reasons behind the downfall, some recommendations would be provided for the industry to focus on as this would help in improvising the condition of the industry and accelerate its growth or regain its position. The report has been structured through acknowledging the possible factors that would have affected the industry and thus all the topics has been selected through it.

Situational Analysis

The exploration and the industry analysis would be done through the following factors assessment which would help in acknowledging the situations that the  industry has faced and what situations has led to the current position of the concerned industry.

Macro Environmental Analysis

Competitive

The major competitors in the industry has been the coca cola Amatil and Aashi Holdings who has been holding about 68.6% of the industry share during the year  2018-2019. The top four competitors holds about 70% of the industry share and the other companies has been observed to hold not more than 5%of the share. The competition has been intense in the industry and the barrier to entry has been quite high which has been increasing with the increased competition (Australia, 2017). These factors along with the other factors of competition that is the cost structure benchmarks, market share concentration and industry globalisation all has been increasing the competition.

The forces which has been impacting the industry are

Entry barriers has been increasing

Globalisation in the industry has been of mediocre range but the trend in on an increasing graph.

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Economic

The economic factor has been quite favourable to the soft drink industry as the increase in the disposable income of the households has been one of the major ingredients of the industry growth. As the household gets an increment in their disposable income the demand for the junk and luxurious goods increases. The industry report reveals that there would be an increment in the disposable income in the year 2018-2019 which would help in regaining the industry’s position.

The key factors which has been impacting the industry of the economic environment has been

The prediction of increase in the disposable income of the households

The increment in the demand of the fast food items which are accompanied by the soft drink consumption is expected to fall in the year 2018-2019.

Political

The political risk in the industry is quite high as with the increase in the globalisation scope of the industry, the exports would be quite expensive. The soft drinks would gain huge demand in the foreign markets which would bring in the economic and political risk to the concerned country and hence this would have a negative impact on the growth of the industry.

The key factors favouring the growth of the industry are as follows

The current political situation of Australia has brought up number of business opportunities for the people which would favour the growth of the industry

The increase in the disposable income has been the result of the improved economy which would favour the growth of the industry.

Legal & Regulatory

The industry has been working with the legal guidelines and has been following the regulatory laws. There has been some companies which has not followed the health criteria for the ingredients of the soft drink and it has been impacting the health of the consumers.

The key factors which has been impacting the industry are as follows

The ignorance of the health criteria to be met through the ingredients of the soft drink.

The avoidance of the regulatory bodies in checking the guide lines are being followed by the industry or not.

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Technological

Since the 90s, the technological innovations has been such that it has always been in favour of the industries and so it has been to the soft drinks industry. The technological improvements has helps in adding on to the productivity of the industry and the lowering of cost has also been met. The soft drink industry has utilised the technologies for checking the viability and the justification of the health issue that would be created through the consumption of the drink.

The key factors which has been impacting the industry are as follows

The invention of the technologies which helped the industry to reduce its cost accelerated it growth and provided an opportunity to sustain.

The various technologies favouring the testing of the drinks, has made the industry to be sensitive and attentive enough to be accurate with its ingredients

Socio-cultural

The trend of accepting the various cultures and trends has provided the industry with a wide range of customers and it has also been the reason for losing some customers. The cultural values which favour the lavish lifestyle and in taking hazardous drinks, has been in favour of the industry while the cultures which are health conscious and demands a justification to the ingredients of the drink has been the reason for losing the customers (Rivera, 2016).

The key factors which has been impacting the industry are as follows

The acceptance of wide range of cultures.

The trend of socialising at large and understanding and appreciating different cultures.

Micro Environmental Analysis

Market Analysis

The industry has been on a decline since last five years and it has marked a decline by about 0.4% at an annual rate through the year 2018- 2019. The falling rate amounts o about $4.4 billion. The industry has been following a falling trend because of the multiple factors as discussed above and the major factor has been the health consciousness of the people. The trend of following a health conscious diet has reduced the consumption of carbonated drinks.

Though there has been prediction of growth of about 0.5% in the present year due to the prediction of the increase in the disposable income.

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Competitor Review

The key competitors in the industry has been the Coca Cola Amatil and Ashai Holdings.

These two companies frames up about 68% of the market share and has been known for serving some quality products to the customers. The other companies has been holding not more than 5% of the market share. The top four companies of the industry has been holding 70% of the market share which leaves some minor parts for other companies. Coca Cola Amatil has been the leader of the industry and it has been providing quality products with reduced cost which has actually helped the company in being the number one in the industry.

Customer Landscape

Australia has been witnessing the population growth with increased in the elderly rate and the youngster’s rate. The buyers of the soft drinks are mainly the youngsters or the school going children who do not understand the importance or the hazard that the drink would make to their health (Adachi, 2017). The drinks are bought for its taste which appears pleasant to the children. The drink buyers also involve the elderly people and the youngsters in which the majority in the elderly ones whose hot spots are the side effects or the benefits that the drink would have on their health and cold spots are the hygiene maintained in the service.

Market Segmentation

Market Segments

Segment (Name)

Description of Segment (consider product offering here as well)

Demographic

Geographic

Behavioural

Psychographic

Segment Attractiveness

Health Oriented Customers

The customers who acknowledge the ingredients and hygiene of the product before consuming.

The elderly and the matured youngsters would belong to this segment

Within Australia

These customers would not respond to price changes or discounts as they need quality and benefits from the product

The psychology of this segment would be to consume health safety drinks

Quality and healthy ingredients of the drink

School Going Children

This segment would be the one who go to school and has not reached the maturity level

The children aged between 12-17

Within Australia

The behaviour of such segment would be to consume the tasty and cheaper products

The psychology of the segment would be to grab the products on discount and offers

Attractive packaging and trendy tastes.

Targeting and Recommendation

Segment 1: School Going Children Segment

This segment would be the most attractive and most fruitful segment to be reached as this would help in attracting the young mind who would focus on the  packaging and the taste of the product. This would help in gaining a market trend and the influential characteristic would also be high.
Criteria Size: The segment is large enough as the population of the young children in Australia has been on an increasing trend.
Money: The anticipated profits from the concerned segment would be of about 5% which would either be equal or exceed the cost of the additional marketing.
Accessible: The accessibility would be quite easy as the school children could be reached easily and acknowledged through their reactions.
Focus on Different Benefits: The influential feature would be the differential benefit which would help in adding on to customers.
The recommended segment would be quite easy to reach and the influential characteristic would add on to the feasibility.

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