The four firm concentration ratio for 1990, 1995, 1998, and 2000E stands at 86.3%, 941%, 92.9% and 93.5% respectively. This indicates that the soft drink industry is gradually becoming consolidated with the top four companies having the largest market share on a progressive year on year basis. This indicates that mergers as well as consolidation of the larger companies with the smaller soft drink companies is possible in the future to gain more market share while also diversifying into other beverage based products.
The strong economies of scale specific to advertising in the soft drinks industry indicates that the largest companies that dominate the soft drink market dominate the advertising and marketing opportunities in the market as well. This leaves the other companies in the soft drink industry with limited marketing options and opportunities to launch their advertising campaigns to make the consumers aware of their products.
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