Coca-Cola’s red and white logo is a familiar sight all over the world, from Argentina to Zimbabwe. Battling rival PepsiCo as well as regional soft-drink manufacturers, the Atlanta-based beverage company has long viewed global markets as critical to its push for profits. It established operations in Canada and Central America before 1910, and today its products are available in more than 200 nations.
The company earns nearly three-quarters of its revenue outside the United States. However, growth in worldwide sales volume has slowed in recent years. As a result, Coca-Cola’s senior managers are looking at ways to build sales in markets that previously seemed less promising because of low income levels, high inflation, currency fluctuations, volatile political conditions, supply and energy shortages, or other complications.

1. Why might a country in Latin America or Africa resist Coca- Cola’s efforts to expand local sales?
2. Does the United States have a comparative advantage in soft drinks? Explain.
3. Knowing that smaller sizes have helped Coca-Cola increase sales and profits in India and China, do you think it should use the same approach in the United States? Why?