and how to go about making appropriate changes or adjustments at a moments
notice. This project is particularly beneficial to the many large bottlers that
have acquired smaller bottlers in an effort to strengthen the bottling system,
because SAP will allow Coca-Cola management to run all the plants as one big
unified company. Furthermore there is an eminent awareness throughout management
to remain focused on the customer and their needs. SAP enables the company to do
this through shared knowledge between each and every bottler. Coca-Cola has also
installed ATLAS (Analysis, Tools, Logistics, And Sales) which will eventually
replace Basis, for creating and organizing delivery routes for each distribution
center. In the long-run Coca-Cola feels as though SAP & ATLAS will help the
entire organization become more efficient while minimizing costs. Another aspect
involving Coca-Cola’s distribution system is the companies’ ambitious product
line. The Coca-Cola Company successfully markets and sells over 160 beverages to
a variety of customers throughout their delivery channels. These beverages are
classified into four separate groups, which consist of the following: * CSD
(Carbonated Soft Drinks) – Coke, Sprite, Surge, Dr. Pepper etc…. * No Carb-
Nestea, juices, Fruitopia etc…. * IcoTonics – Powerade * Water – Desani
(filtered water), and Evian (pure spring water which is imported from Sweden.)
The company’s core brands are Coca-Cola Classic, Diet Coke, and Sprite, which
rank first, third, and fifth among all carbonated soft drinks in North America.
Coca-Cola’s customers are mainly retail outlets, restaurants, grocery stores, or
any other operation that buys their products, and in return sells or serves
these products to consumers. The North American Sector’s major customers are
Burger King, Mcdonald’s, Subway, Wendy’s, and many airlines and hotels
throughout North America and Canada. Coca-Cola’s primary focus with these
products is "instant consumption", because that is an area in the
market that has the biggest growth potential. What instant consumption means is
that Coca-Cola is trying to create product accessibility for the consumer in an
effort to increase their sales volume without compensating the level of quality.
Vending machines help accomplish this goal, because they provide ice-cold
Coca-Cola products to consumers in a variety of locations. Recently Coca-Cola
began offering the 20 once soda beverage in their vending machines, which
instantly became a wise profitable decision. The advantage is that consumers end
up spending more on the 20 once containers then they do with the canned soda,
which in the long run increases company profits. Full-service drivers check and
stock vending machines on regular routes, in a conscious effort to maintain
fully replenished machines. Furthermore the drivers are trained by the company
to focus on product presentation in which they are to follow strict company
policies on how to properly stock Coca-Cola products in retail outlets, as well
as grocery stores throughout the country. The drivers begin each day at 6:00 in
the morning by meeting with sales managers, account representatives, and
merchandisers to plan out exactly how the products will be delivered and sold
throughout the day. Employees at all levels throughout the distribution system
take an extremely aggressive approach to producing and delivering Coca-Cola
products in "real time" without jeopardizing the quality of each and
every product item. This shared dedication to the company is what has enabled
Coca-Cola to saturate the national market and begin its quest for global
dominance. International Distribution Internationally Coca-Cola Company
distributes 160 beverage varieties in nearly 200 countries worldwide. Coca-Cola
owns 50% of the international soft drink market. Coca-Cola works extremely hard
to be one of the few companies in the world to successfully reach literally
billions of consumers. Coca-Cola’s international distribution is the backbone to
the their global approach. "About two-thirds of Coca-Cola’s sales come from
outside North America, making the company sensitive to global economic turmoil.
On the other hand, that turmoil has enabled the company to make inexpensive
international investments. Coca-Cola’s affiliates have been purchasing numerous
bottlers in the U.S. and around the world to recognize its global bottling
system into major anchors in prime markets" (Coca-Cola Overview, 1).
International distribution for Coca-Cola began when they decided to introduce
Coke to Canada and Mexico in 1898. Within that same time period Coca-Cola
expanded across the Atlantic Ocean to Europe. The man responsible for this was
Charles Howard Candler, the oldest son of Coca-Cola’s founder Asa Candler.
Charles brought with him a gallon of the secret syrup and sold it to an American
owner of a London soda fountain. The Coca-Cola syrup made an immediate impact in
Europe, which called for orders of five-gallon drums to Germany, Jamaica, and
Panama. In 1906, the international bottling and distributing plants were
established in Panama and Cuba. Then in 1926, Coca-Cola’s international
distribution began to expand even more with the help of a man named Earnest
Woodruff. He worked with his associates and Coca-Cola on organizing
international expansion by creating a Foreign Department. In 1930, the Foreign
Department became a subsidiary called The Coca-Cola Export Corporation
distributing in only a few European countries and Canada. By 1940, Coca-Cola’s
sales began to increase with the expansion of bottlers in forty-five
international countries. To this day Woodruff’s theory is still being
implemented as part of Coca-Cola’s strategic global approach. As a result of
this strategy, 80% of Coca-Cola’s operating income was coming from outside the
United States by the 1990’s. In 1993, there was concern with expanding
Coca-Cola’s international distribution due to a competitive global market.
"In 1993, more than 6.3 billion unit cases of Coke and Coke Classic were
sold worldwide, in more than 195 countries. Diet Coke was also the number one
low-calorie soda in the world, available in 117 countries" (Global
Dominance, 3). Along with the expansion came problems for the Coke brands such
as Fanta, Sprite, and Minute Maid. Coca-Cola didn’t want to rely on its bottlers
to distribute and market their products. So, Coca-Cola and a regional manager in
the Phillippines came up with a new strategy model for international expansion.
"When entering a new market, the Company would seek to establish
distribution of Coke products in key population centers and develop
relationships with the important retail channels" (Global Dominance, 4).
Coca-Cola is divided into four international geographic operating units and one
national operating unit. The four international geographic operating groups are
the Greater Europe Group, the Latin America Group, the Middle and Far East
Group, and the Africa Group. The Greater Europe Group operates in Western Europe
and is also growing in the eastern parts of Europe. The Latin America Group
covers from Tijuana, Mexico, in the north to Tierra del Fuego in the south,
which also includes operations in Central and South America. The Middle and Far
East Group operates in the most populated areas of the world. This group manages
the countries of the Pacific and Middle East. These countries consist of Japan,
Australia, China and India. The last group is the African Group, which operates
in the countries that make up the sub-Saharan Africa. "The Company and its
geographic operating units are led by a management team of seasoned soft drink
business veterans from every corner of the globe" (Facts, Figures, and
Features, 10). The Coca-Cola Company has too many countries to that they
distribute too, and it would be impossible to list and explain each and every
country. Japan, Argentina, Denmark, France, Belgium and China are six of
Coca-Cola’s major distribution countries. The Coca-Cola Japan Company is a
complete beverage corporation that has accomplished leadership by continually
providing customers with beverages of the finest quality. Japan is highly
ambitious in the beverage market. Boasting more than seven thousand different
soft drinks to choose from, the CCJC is extremely competitive. In their vast
market, there are five hundred different manufacturers. Approximately one
thousand new types of beverages are introduced annually. The CCJC offers more
than twenty-five brands and sixty flavors. Fifty percent of all soft drink sales
are made through vending machines making them an important part of sales at the
CCJC. The CCJC maintains nine hundred thirty thousand machines, more than twice
the amount of the closest competitor. In 1942, Coca-Cola production began in
Argentina. Coca-Cola began flying off the shelves the day it was introduced. A
total of seven twenty-four bottle cases and eighteen single 185-milliliter
bottles were sold that day. Sales in Argentina climbed up to 300,000 cases by
the end of 1943. Coca-Cola de Argentina S.A. currently sells approximately 1,000
times more beverages annually than that historic year when it all started in
1942. They accomplish these goals by using a fleet of 3,000 trucks and 18,000
reliable employees who see to it those Coca-Cola products are readily available
in every corner of the country. In the 1930’s Coca-Cola was imported into
Denmark. An estimated forty-percent of Coca-Cola products are consumed by about
5.2 million Danes. In 1933, Coca-Cola was introduced to France. Making its first
appearance at the "Caf? de l’Europe" in Paris, Coca-Cola has been the
number one beverage in France since 1966. The total amount of sales has doubled
in eight years. Coca-Cola France has made more than 1,000 jobs available since
1989. Also, three billion francs have been invested in France since 1989. The
French consumers currently drink roughly 88 servings of Coca-Cola products
annually. The most popular brands in France are Schweppes, Canada Dry, and Dr.
Pepper. In 1927, Belgium was introduced to Coca-Cola. Due to the popularity of
Coca-Cola in Belgium, it is one of the top 20 countries in terms of consumption.
The Coca-Cola Company employs about 2,000 people and supplies up to 30,000
restaurants in Belgium. Recently, in Belgium there had been a contamination
scare which cost Coca-Cola and its bottlers over $60 million in sales. Coca-Cola
recalled about 14 million cases after E. coli bacteria got into their products
and caused approximately 200 people to become ill. It was said that bacteria
from the pallets got onto the cases of Coke. Then the people who drank the soda
ingested the E. coli bacteria and got sick. There also had been a health scare
with mineral water and the report of E. coli bacteria contamination in Poland.
This problem only happened with brands distributed in Europe. Coca-Cola entered
China’s market in 1927 and is known as one of the largest soft drink markets in
the world. Coca-Cola’s operations in China are a huge part of their success for
their global approach. China’s population is about 1.2 billion and Coca-Cola
covers approximately 900 million of their total population. Coca-Cola is still
trying to reach more consumers in China, so they’re establishing a new
distribution strategy to reach the other 300 million people in less-populated
and distant areas. They want to develop a direct distribution system through
route sales and opening more sales centers in the smaller cities. Coca-Cola’s
main focus in China is to create affordable packaging and improving
distribution. China’s consumers prefer to drink Coke out of non-returnable
plastic bottles or cans. Coca-Cola has twenty-three operating plants throughout
China, but many of the western provinces, still do not have franchises. Hong
Kong, which is southeast of China, is home to the world’s tallest bottling
plant, which measures fifty-seven stories. Future success for Coca-Cola in China
depends on its main competitor Pepsi Co. Coca-Cola’s key strategy for success in
the world is investing in infrastructure. Coca-Cola invests billions of dollars
to consolidate and develop new markets. "The Coca-Cola system has
successfully applied a simple formula on a global scale: Provide a moment of
pleasure of refreshment for a small amount of money-hundreds of millions of
times a day" (Chronicle of CC, 22). The Coca-Cola Company’s overseas
distribution is an around-the-clock operation to get the consumers their
product. Coca-Cola in Europe has different types of delivery systems to their
customers. International warehouses use larger truckloads for bulk orders to
distribute to customer warehouses. They also use smaller trucks for local
deliveries. Also, in "North America and Belgium, drivers use side-loaded
trucks to deliver 400 or more cases of product each day. In other European
locations, delivery is typically handled by third-party distributors"
(Facts 1999, 11). Coca-Cola’s target areas are grocery stores, recreational
areas, shops, malls and sporting events. The mass of distribution to cus
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