Week 2: What are the challenges that Coca-Cola is likely to face to grow its business in Africa?
Coca-cola is also referred to as Coke, and it is a carbonated soft drink that is manufactured by the Coca Cola Company. Initially, the drink was a temperance drink that was a patent medicine. The company was invented in the 19th century by John Pemberton, and later on, it was bought by Asa Griggs Candler, who was a businessperson (Coca-Cola in the spring and summer, n.d). Candler had a great marketing tactic, and this made Coca- Cola to gain a higher dominance globally. The main ingredients of the drink are coca leaves and kola nuts, and the current formula in the drink has continued to be a trade secret.
Coca-cola is likely to face several challenges in Africa. The first challenge is that the company could have a huge problem addressing uncertainty in the low- calorie CSD strategy. Governments in Africa have taken a step ahead to publicize the concerns that they have on obesity. They have also been concerned about the sugar content in soft drinks such as Coca- Cola. The company has developed low, and zero-calorie drinks that are the top-ranked brands in the categories (Coca-Cola in the spring and summer, n.d). The low-calorie cola category has been a problem. Due to this reason, African consumers have been concerned about the alternative sweeteners that are present in CSD. Thus, the governments feel that the company should continue with its research on low- calorie alternatives in the soft drink, and they should also come up with a way where they convince the consumers on why they should take the drink.
Initially, the drink was made using cocaine, but things changed over time. Most of the Africans are conservatives, and they do not easily adapt to change due to these reasons, most Africans feel that the drink may not be too safe for them and others have also believed that the drink may have little content of Caffeine. Nonetheless, Coca- Cola may also face the challenge of competition. Most of the multinational beverage- producing companies have brought their products to Africa, and the Africans have also started making their beverages. Coca-cola may face competition from these companies, and the competition could make the company incur losses, and it could also elevate its marketing strategies in Africa. The company may also face the bottling challenge (Coca-Cola in the spring and summer, n.d). There are many bottlers in Africa, and the company has to ensure that the bottles are appealing to the people. Due to this reason, there must be uniformity in the way the product looks, and it shows that the company has to improve its bottling challenges.
Week 3: Assume you work for a Norwegian company exporting a container of salmon to Azerbaijan or Haiti. The customs official informs you that there is a delay in clearing your container through customs, and it may last a month. However, if you are willing to pay an “expediting fee” of €200, he will try to make it happen in one day. What are you going to do?
The above question mainly looks at the ethics of international trade, especially when dealing with the cultural norms that differ from the source nation of the exported products. In this case, the salmon is from Norway, which is a third world country, and it has high levels of poverty, and there is no social security. Ethics is a term that is used to describe the principles that govern the standard norms of conduct, especially relating to companies and people’s behavior in business (Franklin, 2018). Corporate Social Responsibility (CSR) is a concept that has been criticized by people who claim that the company’s activities are only “window dressing.” Corporations do what is best for the shareholders. However, it is notable that every decision has consequences even though it benefits the business. If the fee is paid in this case, the firm could be implicated for taking part in a corrupt act. The company could also be held accountable for this crime in a court of law. The payment is also disadvantageous since it encourages the continuity of corrupt activities in businesses. Corruption has been a menace that most nations are fighting today, and the citizens are encouraged not to support this act since it leads to inequality in all sectors. If the fee is paid, the compact is not taking oath in the CSR obligation (Franklin, 2018). However, if the firm wishes to be part of the CSR, it can look for other markets where it can sell its salmons. Conversely, if the firm does to pay the fee, there are high chances that it may lose the perishable product, and it could suffer losses. In the nation, its culture suggests that there is a social structure that is different from the source of the nation. The two nations need consumers, and the companies must market their products. Therefore, the fee could be viewed as a cost of doing business in a global economy. Thus, paying the expediting fee could make profits for the company, and this could be the best decision since global trade is not mainly about ethics and morals, but it is mostly about the profits that are made for the shareholders.
Week 4: You are the PR officer of a major MNE in the chemical industry. The national press in your home country alleges that your company is covering up an environmental disaster caused by your subsidiary in India, in which several people died. How do you react?
The PR officer has to sacrifice a lot for the company. For instance, he or she has to ensure that there is damage control and even that the media has been effectively used in creating a positive image for the company and its operations in India. The company’s benefits must be brought to the region, employment for locals, and even the things that the local community is doing to fix the problem that has been created (Developing the strategy, 2016). The company has been doing many things such as cleaning the land to stop environmental damage and even compensating the families that have been affected by the deaths. Respect to the practices, norms, and values can also be shown to the affected people. The situation tends tri create both short and long- term costs and consequences for the firm.
In short term cost, the cost of cleaning up the affected land to stop long- term damage to the environment can be done. This is mainly done to enable the locals to start reusing the affected land in no time. In a bid to arrange compensation for the affected families, this procedure could be either a court agreement or even a voluntary agreement. The plant will temporarily close the situation that has been assessed, and maintenance has to be undertaken. This means that the local employees will no longer have an income, and the company will look after the workers’ welfare until production begins again. Similarly, this will be effective in dealing with the sensitive issues at both the state and local levels. The workers will receive reassurance that everything is being done to fix the problem and to ensure that the issue does not happen again.
In the long term, there will be costs that have to be incurred in making improvements in operational and safety procedures. This includes better training for employees with the OH&S procedures to mean that the workers will be subjected to better safety standards, and this will make the working environment to be safer. Costs will be associated with training in updated operational procedures in bathe office and medical plants as a way of ensuring that these accidents do not reoccur.
Therefore, the PR officer needs to show the press in the home country tyrant everything is under control and that the necessary steps to ensure that the workers are in a safe working environment are in place. The press could also be shown the different changes that are to be done to ensure that the chemical plant operates more safely and that the local community will benefit from this (Developing the strategy, 2016). The media should be shown that efforts are underway to ensure that the efforts are underway to prevent a chance that the accident reoccurs again.
Week 5: Some trade unions fear that the free movement of people depresses wages of ordinary workers because immigrants from other European countries are willing to work for lower wages. Should the free movement of people thus be restricted for some countries or for certain time periods?
In the year 1973, the United Kingdom became a member of the European Union. The union I was made up of 27 nations in the year 20165, and this was a part of the charter that was made to promote a common market, which was a free movement of people and goods between the member states. The single market was originally created to promote stability and integration in the European continent. The basis was to find common ground on economic and political coordination. It was also to harmonize the free trade area and policies that aimed to remove trade barriers. The custom unions were also created to provide policies in trading with the members that were not part of the European Union. Common Market in free movement of people and goods could later lead to the euro becoming a common currency between these members. However, only 176 of these nations adopted this currency, but the United Kingdom did not (Free movement of people, immigration, and asylum in the EU, n.d). The choice that the United Kingdom made was also based on the fact that they had only partially agreed to the Schengen agreement to mean that the people were given passport-free travel within the EU. However, the decision-making process in the European Union was based on democratic principles. The nation did not adopt the euro since they had come to terms that this was disadvantageous for them since they could not implement the independent monetary policy. There were also limits to use fiscal policies concerning economic management if the economy. With the presence of Brexit, the United Kingdom decided it was better to go their way.
The free movement of people was a great concept. Still, in reality, it was not great, especially since there were disparities between the wealth of member nations that had provided friction between some of these nations. Examples of these e nations included Bulgaria, Poland, and Southern European nations such as Spain and Italy who had an unemployment rate of 25%. In times of economic growth, the citizens of the poorer nations can migrate to wealthier nations to get jobs that the locals do not want (Free movement of people, immigration, and asylum in the EU, n.d). The wages in other countries may be higher when compared to those in their nations. In times of economic growth immigration, there is an increase in the demand for goods, and this could create opportunities for the businesses to show that people need housing to stimulate the construction industry to provide housing. The free movement could create greater wealth within the economy. However, it could be disadvantageous since the immigrants filled the jobs that the locals should have, and there are also limited job opportunities for the nations. However, immigration stimulated the economy. In summary, immigration stimulates economic growth through different aspects of the economy. Still, in the cases, there are recession restrictions on immigration, there is a reduction of stresses in the economy.
Week 6: You are an IMF official going to a country whose export earnings are not able to pay for imports. The government has requested a loan from the IMF. Which areas would you recommend the government to cut: (1) education, (2) salaries for officials, (3) food subsidies, and/or (4) tax rebates for exporters?
The IMF has three main functions relating to its 188 members. They include monitoring the global economy, providing technical assistance to developing nations, and even lending money to the countries that are in financial difficulties. The above question relates to the third function. The government is going to cut education, and long-term education is considered to be a way of fighting poverty. Better education tends to increase people’s ability to improve the nation’s economy, and it also helps them solve problems. If there is a reduction in salaries of the public servants, it may create dissent among the population and to may lead to civil unrest. Correspondingly, cutting the food subsidiaries may lead to social unrest since the food subsidiaries are a means to assist the unemployed to reduce crime and a social safety net (Gomel, 2017). It also reduces reliance on the health system. The fourth option is to give tax incentives to the exporters as a way of increasing exports by being more competitive in the global market place and even reducing production costs. The main issue here is increasing income and reducing costs. It could be done in two distinct ways that include increasing taxation of VAT, GST, and even income tax, it reduces the available disposable income, and less money is spent on the government. The government expenditure is reduced, and the exporters are given incentives that increase production and export earnings. These options could be perfect in reducing the current account deficit, and the government should generate a surplus for the loan to be paid back.
References
Coca-Cola in the spring and summer. (n.d.). The Coca-Cola Art of Jim Harrison, 17-54. https://doi.org/10.2307/j.ctv6wgkj9.5
Developing the strategy. (2016). Chief Talent Officer, 30-47. https://doi.org/10.4324/9781315796048-2
Franklin, A. (2018). Anti-corruption programs why businesses need to adopt them urgently. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3164690
Free movement of people, immigration, and asylum in the EU. (n.d.). EU Law for UK Lawyers. https://doi.org/10.5040/9781472565600.ch-015
Gomel, G. (2017). Crisis prevention and the role of IMF conditionality. Governing Global Finance, 167-175. https://doi.org/10.4324/9781315182506-9