TNCs/Coca Cola

Question 1

Primary sector TNC

Answer 1

Tesco automated orders for Kenyan flowers.

Question 2

Tertiary(can be secondary or quaternary too)

Answer 2

19 differnt langauges for franchise love island for ITV co-owner.

Question 3

What enables firm to become TNC

Answer 3

-Develop highly desirbale product within a price range that can be easily delivered around world.
-New innovative model/constant innovation eg Apple.
-Obtaining dominace in a market/monopoly power.
-Undercut competition on price due to efficiency.
-FDI to take advantage of low cost/lax laws/locate near de,and.
-Take advantage of transport systems for cheap, efficient production.
-Mergers, take-overs, aqcusitions.
-Horizontal/vertical integration. Offshoring, outsouricng.

Question 4

Called the “a________” of globalisation

Answer 4

Architects

Question 5

Describe spatial distribution of TNC HQs

Answer 5

TNC’s tend to have a hierarchal structure that makes decisions from top-down, this can put anyone who is not at the top of the hierarchy at risk from key decisions from above. Be it closures to save money/boost efficiency.
Mostly HICs but growing in EMEs. Eg North America, Europe and SE Asia. Often in world cities (synoptic). Few in Australia.

Question 6

Describe Mini car assembly shwoing TNCs relying on multiple suppliers

Answer 6

Mini Car comprised of 2500 different suppliers

Question 7

Marketing of TNCs: Describe

Answer 7

Global marketing/branding.
Multiple languages in instruction manuals.

Question 8

Describe glocalisation and give 2 reasons for it

Answer 8

To maximise profits, TNCs adapt products to suit their customers needs geographically.
Law: Driving seat position.
Local interest: Mcdonalds McSpicy Aloo in Inida.

Question 9

2 pros and 1con of vertical integration

Answer 9

No reliance on suppliers, cheaper with EOS such as transport.
Expensive

Question 10

Horizontal integration is just mergers/takeovers etc. What is vertical disintegration?

Answer 10

Different parts of prodction process given to different companies to do.

Question 11

1 benefit of TNC and 2 drawbacks not mentioned in econ

Answer 11

-Development of managerial roles.
BUT
-Speculative investments eg 2008 GFC.
-TNC can cease operation if not profitable.
-Large corp tax to host country if it hasn’t managed to reduce tax/avoid it. Trademarks/patents. Force SEZs (special enterprise zones).

Question 12

Global revenue of Coca Cola
Market share
Recognition
Average servings per day

Answer 12

46 billion
26%
94% of people recognize
1.9 billion per day. 9 a day in 1886. Drastic change in volume over a relatively short temporal scale (when looking at figures)

Question 13

Spatial distribution

Answer 13

144 offices in 67 countries. Spreads risk.
Domiciled in HQ in Atlanta, Georgia
Some globally except Cuba and North Korea
Bottling investment group where they bought small scale companies across world to increase effiency.

Question 14

3 causes of growth

Answer 14

Investment, clever marketing (anyone can be Santa 2024), acquisitions of other firms

Question 15

Coke acqusitions/marketing specifically

Answer 15

Coca-Cola has 3500 products within its entire brand. Cola, Fanta,Dasani water. 10% of all their revenue is spent on marketing even though 94% of all people on Earth already recognise the red and white branding. Coca-Cola’s recent marketing campaigns have aimed to link the beverage to a feeling of happiness, relaxation, love and other positive feelings (Taste the feeling being one slogan) As marketing streams change, as did Coca-Cola’s strategy. New hashtags, a Coco-Cola Emoji, Coke TV all formed in the last 2 years alone.
Glocalisation is shown in Coca-Cola’s famous de-branding tactic. Piloted in Australia when Coca-Cola took its brand name off their bottles in favour of the 150 most common names in Australia (accessing 42% of the population). It was an immediate success and the campaign was took to 70 more countries and the name list grew 17000 strong with many localised names. It made the process of consuming more about giving to one another and the use of names made it a much more personal process.

Question 16

Positives of Coca Cola

Answer 16

-Training and education programmes – global commitment in women’s empowerment (5by20 programme to create 5 million female entrepreneurs by 2020).
-Massive employment opportunities both direct and indirect and in less developed economies such as N. Afruica. More than 700k employees.
-Using the brand name – Coca-Cola uses marketing to promote recycling and its distribution network to help deliver emergency aid for disaster relief.
-Sustainable Agriculture – Schemes such as rainwater harvesting systems for their tea production in China.

Question 17

Negatives of Coca Cola

Answer 17

-Harsh working conditions in some of the bottling plants.
The Trade Union Conflict in Colombia between the government/local councils (alledgedly bribed by CC) vs Rising trade unionists.
Long hours for little pay – Most workers
-Unequal flows of capital – A lot of the profits end up back in the hands of the shareholders back in the USA.
-Vulnerability – Bottling plants on the other side of the world from the ‘remote’ Coca-Cola HQ in Atlanta, USA could suffer due to ‘top-down’ decision making.
-Exhausting local water supplies – in 2012 Coca-Cola used more water than 25% of the worlds population. Eg India issues with skin health when using domestically.
Pesticide identified in some products – Scientific foundations discovered up to 30 times the amount of pesticide recommended by the EU in Cola products.

-Sports: However, conflicting messages can often be portrayed as sporting groups/teams/events are often sponsored by fast food companies, or carbonated drinks companies. This does not reflect the healthy image sports groups would want to convey. Sometimes, all it takes in one small thing to happen to have a massive knock on impacts.

Question 18

Aim

Answer 18

The Coca-Cola Company (“Company”)is a global business that operates on alocal scale, in every community where we do business.We are able to create global reach withlocalfocus.

Question 19

Coca Cola Foundation: 3 Ws

Answer 19

Water, women, well-being

Question 20

Give 2 water benefits

Answer 20

-China rainwater harvesting
-4 billion litres of water annually replenished since 2010.

Question 21

Give one well-being benefit

Answer 21

-More than 2k college students in US funded by Coca Cola.

Question 22

Describe 2 benefits of 5 by 20 programme for women

Answer 22

Coca-Cola’s 5by20 Program:
Objective: Empower 5 million women entrepreneurs across Coca-Cola’s global value chain by 2020 through skills training, financial services.
• Scope: Targeted women in over 100 countries, focusing on small business owners like farmers, retailers.

•	Success: By 2020, the program reached over 6 million women, exceeding its target, and was praised for fostering economic independence, though some critics highlighted challenges in sustained long-term impact and how well metrics were measured.

Question 23

Coca Cola circular economy

Answer 23

• Progress Made: Coca-Cola has pledged to use at least 50% recycled material in its bottles by 2030, with efforts like “World Without Waste” showing incremental improvements.
• Challenges Persist: Despite these initiatives, Coca-Cola remains the world’s largest plastic polluter (as per audits by established organizations).

Question 24

TNC impacts on hsot country, employees, local businesses and UN

Answer 24

In the host country, there is increased rural-urban migration as farm workers seek out higher wages in TNC factories or call-centres. This creates a greater level of inequality between urban centres and rural areas. * Analysis of the role of TNCs in promoting economic growth. In the host country, contrary to popular beliefs TNCs often pay higher wages – average wage is 40% higher than that paid by local firms this can result in local firms having to close due to lack of workers. On the other hand, many TNCs use local firms to complete part of the production process increasing investment in the local area.
* They may consider that TNCs have on some occasions undermined the work of the UN. For example, despite attempts by UN to negotiate fairer trade between LICs and HICs, TNCs have frequently moved in and brought up land used by local farmers

Question 25

Red and white colours influencing culture

Answer 25

Colours of Santa clause (potentially)