coca cola

• Coca-Cola is the most popular soft drink brand globally, with over $30 billion in annual revenue.
• TNC

  Trans-national corporation = huge companies that have expanded their operations to a global scale

  HQ usually in a HIC then spreads to other places like LIC's as cheaper labour costs
• Reasons for TNC growth - Cheap labour

  low wage demands in LIC and NEE countries means lower labour costs
• Reasons for TNC growth - Mergers and takeover


  Big businesses buy out smaller corporations to increase their size of their share in the market, wiping out the competition
• Reasons for TNC growth - Flexible workforce

  Employees will be willing to travel across the world in order to help expand their company, for example flying out for meetings or training
• Reasons for TNC growth - Availability of finance to fund expansion

  TNC's have huge sums of money that they are able to fund into their operations, such as buying out other companies or opening new factories
• Reasons for TNC growth - Fewer environmental restrictions

  If TNC's operate in LIC or NEE countries it is likely they have weakly enforced or less strict rules and regulations around environmental protection and so can be exploited with TNC's dumping waste and not following environmentally friendly procedures
• Reasons for TNC growth - Globalised transport networks

  containerisation revolutionising the transportation of goods around the world via ships trains and lorries
• Reasons for TNC growth - Technological developments

  refrigeration or freeze drying has made the transportation of foods and beverages globally a lot more cost efficient and safe
• Reasons for TNC growth - Governmental encouragement

  Governments will often offer TNC's a lowered tax rate to encourage them to remain in their country and keep their investment into the countries economy
• Reasons for TNC growth - Cheap land

  Areas in LIC's and NEE's are significantly cheaper to purchase land due to lower living costs as it is located in a poorer area Also, areas want to encourage operation of TNC's as they want to bring their value into their economy so will offer cheaper land prices in order to encourage them to set up in their country.
• Spatial organisation

  In general TNC's have a hierarchical model of organisation and impose top down decision making.

  e.g. Branch plants recipients of change and decisions, may result in branches being vulnerable to sudden closure or job losses like UK steelwork Tata Steel 2015
• Origin and Host countries

  Origin = TNC set up and HQ

  Host = Places TNC set up operations
• Host country Benefits

  - Increased levels of employment which leads to raised living standards

  - Raised levels of skill and expertise in the population

  - Foreign currency is invested balancing payments

  - Multiplier effect as population has more money they can spend on more products increasing TNC demands

  - Encourages transfer of technology into the country such as the growth in mobile phone usage globally
• Host country negatives

  - Many jobs in LIC's and NEE's are low skill

  - Management positions within the company often given to external employees rather than ones from host countries

  - Majority of profits sent back to home country of company

  - Multiplier effect can be negative on factors such as the environment as TNC's use their power to cut corners in terms of following rules and regulations around the environment and worker safety

  - Investment may be short term and withdrawn suddenly, leaving host country who was dependant on investment in financial crisis
• Home country positives

  - Growth in higher order jobs such as research and management

  - Overseas investment allows growth in economy for whole nation via taxes

  - Wider share ownership as companies become more comfortable with foreign investments into their business
• Home country negatives

  - Workforce may need to relocate or take increased overseas visits

  - Due to loopholes TNC's will not pay full taxes and keep profits for themselves rather than growing the economy

  - Investments into TNC's contributed to 2008 financial crash
• Coca Cola

  Huge TNC drink manufacturer
• Coca cola HQ

  Located in Atlanta Georgia and its place of origin
• How many servings of products consumed daily

  1.9 million servings globally
• Coca cola background - founded

  founded in 1886 in Atlanta Dr John Pemberton
• Coca cola background - countries operating

  200 countries and territories globally
• Coca cola background - generated revenue

  66% of Coca Cola revenue generated from international operations
• Coca cola background - employees

  82,500 people across the globe
• Coca cola background - 2015 named


  named one of the worlds most successful and valuable brands by Interbrand
• Coca cola background - product variations

  Sells 400 variations of product worldwide
• Spatial organisation - Coca Cola

  Brand has grown due to investment and strategic acquisitions

  skilled in spreading locational risks as well as moving into new markets, e.g. use existing bottling companies rather than building new factories.
• Spatial organisation - shortage of bottling capacity

  in Eastern Europe, India and Africa, Coca cola has seized the initiative and commit to billions of dollars of investment

  Now have multiple brands (innocent and fanta) that generate over $31 billion in revenue a year in 200 countries
• Home country Coca Cola

  Atlanta Georgia USA

  Coca Cola originated

  Brand value of $89 billion and in 2022 $57 billion invested back into US economy

  Host country sees over half the companies profits
• Host country

  Coca cola operate globally

  however only see around $30 billion of brand value overall

  minimal profit to be spread around global branches
• Controversial coca cola - drugs


  original recipe contained cocaine
• Controversial coca cola - Nazi


  supplied products to Nazis, sponsored Olympics and throughout WWII

  denies all involvement now
• Host impacts - India

  -Bottling plants across India

  -Factories known for water consumption

  -Communities at high risk from droughts pushed into water scarcity causing unrest between communities and law due to factories

  -Agricultural impacts as lack of water meant no ability to fertilise, grow, and sell crops destroying local economy

  - Plants distributed waste including toxic chemicals to local farmers as "free fertiliser" as a way to dispose killing crops and local health
• Host impacts - El Salvador

  - Coca Cola includes El Salvador biggest export sugar

  - Sugar cane plantations linked to Coca Cola child exploitation handling machetes

  - Illegal to work under age of 18

  - Coca Cola said they against this and ensure suppliers worth ethically

  - Coca Cola tried to separate from actions of bottlers and said they are "independent" and not under their responsibility
• Host impacts - Columbia

  - Allegations of paramilitary groups to kill and torture union activists

  - 2003 = trade unions organised boycott of Coca Cola accusing of hiring these groups

  - Alleged far right militants to murder nine union members at Colombia Coca Cola bottling plants

  - Strategically targeted members to reduce unions powers