The theoretical framework of the Internationalization Process theory was

The theoretical framework of the Internationalization Process
theory was developed by Wiedersheim and Johansson. This theory lays its
emphasis on the four aspects which are market commitment and knowledge, current
marketing activities and commitment decisions. The major internalization
theories that are implemented by a company while entering into any new market
are contract manufacturing and exporting and licensing. Licensing is considered
to be the permission granted by the proprietor owner to any foreign company to
sell their product, which would otherwise have been forbidden. Franchise on the
other hand is when any company undertakes the right to take the business
activity, by using the company’s name. However, Joint venture can be totally
different from these two internationalization theories, as in this case a
completely new identity is created in which both the companies take an active
role. Export can be direct or indirect. When the firm exports indirectly it
operates through the confirming house, buying a house or export house (Anon.,
2015). However, in this case franchising can be a better option for the company.
The company started giving away its bottling rights for a dollar each, while
maintaining the rights of the syrup produced. This was the initiated of what is
now addressed as the Coca-Cola system of franchise partnership. This
partnership with the bottlers is what led towards the internalization of the
brand. These bottlers are the public companies operating with the rights from
Coca-Cola such as Coca-Cola Enterprises, Coca-Cola Bottling Company, Coca-Cola
Consolidated Bottling, etc. It International Marketing 9 was in the year 2013,
when the company updated its franchising model in Canada and US, making its
agreement with the American and Canadian bottlers and expanding its territory
(Feloni, 2015). Coca-Cola has implemented all the theories of internalization
at some point of time. The internationalization strategies of Coca-Cola have
been a success in the first place. The company exports the syrups to the bottle
owner, who have the right of manufacturing the firm’s product. There are a
number of challenges that Coca-Cola faces while operating in the global market.
In the developed countries, children may become obese due to the excessive
consumption of CocaCola. These allegations are often addressed by Coca-Cola.
As, once the CEO of the company gave the statement that children in the
developed countries are not obese because of the consumption of Coca-Cola but,
they are obese because they do not take part in enough sports’ activities. He
also added that company’s products, like diet Coke is healthy for children, as
well as the adults. The internationalization theories adopted by Coca-Cola
helps it in facing the competition from the local companies. Competing in the
global market exposes the company to local competitors (Mok, et al., 2002).

Conclusion The global companies continuously
need to generate and sustain high profit levels, to create competitive
advantage for the company. For example, Coca-Cola continuously needs to build
its brand image by adopting effective and successful strategies related to promotion,
provision and advertising. The distribution system of the company needs
consistent development and expansion. Coca-Cola has been doing this
successfully over the years with the help of its strategy of growth, enabling
the company in the development of its international market International
Marketing 10 leadership. The company over the years had successfully developed
a global mindset which involves understating of different global cultures,
utilizing work relationships and identifying and grabbing every global
opportunity.

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