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Supply Chain Management of Coca Cola Company

Organization:

Supply Chain Management on

The Coca Cola Comp

any
Course Name: Supply Chain Management
Instructor Name: Sir Shoaib Ahmed
Course Code: MGT-518
Semester: Summer-2014 Batch B.B.A (Hons.)
Group Members:
1. Talha Hassan BB-2131
2. Saad Mussarrat BB-2359
3. Shahzaib Malik BB-2116
4. Maaz Uddin BB-25227

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Acknowledgement
First of all, we are thankful to Almighty Allah (The
most gracious
and the most powerful, the knower of hats see a
d u see ),
for giving us the courage and power to learn and
to apply our
knowledge for the benefits of mankind.
We would like to express profound gratitude to o
ur instructor
or teacher Sir Shoaib, for their support, e
ncouragement,
supervision and useful suggestions throughout this
project work.
We would not have been able to finish this wond
erful project
without his support and guidance. Thank you
for patiently
guiding us throughout this project and motivating
us to work at
our best. Group members are Shahzaib Malik, Saa
d Mussarrat,
Talha Hassan and Maaz Uddin for the course of
supply chain
management and the organization or company is t
he coca cola
company.

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Introduction
Company Profile:The

Coca-Cola Company is an American multi

national beverage
corporation and manufacturer, retailer and marketer of nonalcoholic bever
age concentrates
and syrups, which is headquartered in Atlanta, Georgia. The company is
best known for its
flagship product Coca-Cola,
invented in
1886
by
pharmacist John Stith
Pemberton in Columbus, Georgia. The Coca-Cola formula and brand wa
s bought in 1889
by Asa Griggs Candler (December 30, 1851 - March 12, 1929), who incor
porated The CocaCola Company in 1892. The company operates a franchised distribution sy
stem dating from
1889 where The Coca-Cola Company only produces syrup concentrate
which is then sold to
various bottlers throughout the world who hold an exclusive territo
ry. The Coca-Cola
Company owns its anchor bottler in North America, Coca-Cola Refresh
ments.Its stock is

listed on the NYSE and is part of DJIA, S&P 500 index, the Russell 1000 In
dex and the Russell
1000 Growth Stock Index. Its current chairman and CEO is Muhtar Kent. C
oca-Cola currently
offers more than 500 brands in over 200 countries or territories and serv
es over 1.7 billion
servings each day.

Over 146,000 employees around the world

More than 1.7 billion servings per day

More than 3500 kinds of beverages

Sponsorship: Olympics, FIFA, EURO etc.

Charity and contributions 1% from the total income

ety.

The Coca Cola Foundation, 1984. Financial support for improving soci

2002-2010 more than $690 millions of contribution and charity.

The biggest contributions:

Africa 11 millions

China Youth Development 6 millions

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Supply Chain Management of Coca Cola Company

United Nations 2 millions

Vision
To become the best place to work for people
To present the world a quality beverage brand.
To make a difference by helping, building and supporting sustainable
communities.
Being highly effective and fast moving organization

Mission
To refresh the world and inspire moments of happiness and optimism.
To create value and make a difference.

Values
Leadership: The courage to shape a better future
Collaboration: Leverage collective genius
Integrity: Be real
Accountability: If it is to be, it's up to me
Passion: Committed in heart and mind
Diversity: As inclusive as our brands
Quality: What we do, we do well

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Images of few of

The Coca Cola Company

Brands

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upply hai
atio al

ordi g to The Co a Cola Co

pa y I ter

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Market Share by Coca Cola World Wide

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Competitive Strategy
Focus on aggressive marketing has been the cornerstone of the
culture and strategy of
its business.

Coca-Cola always made expansion efforts.

Coca-Cola not only produces soft drinks but it also serves energy

drinks, tea, juice


drinks and water.

Acquisition for gaining competition advantage.

The most important factor of the Coca Cola Company is its


employees.

Coca-Cola is selling its product to the multinational organizations like

MC Donald's,

KFC, Sub-way, Dunkin Donuts and also keeping local market in focus.

Coca-Cola is focusing on public by charitable contributions.

Coca-Colas

alue a d future de elop

e t pla s lead to i rease i

he i terest are
holders.
They are operating through push strategy of supply chain worldwide
in the beverages
industry.

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Global Presence till 2012

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Global business is organized into six geographic Operating departments:


1.
2.
3.
4.
5.
6.

Africa
Pacific
European Union
Latin America
Asia
North America

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Organization Structure Global Decision Making


Process

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Coca Cola Supply Chain Process

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Supply Chain Stages

A typical supply chain may involve a variety of stages:

Customers

Retailers

Wholesales/distributors

Manufacturers/ Plants

Component/raw material suppliers

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Inventory and Warehouses system

A-B-C classification

Studying the demand and finding the best method for forecast
ing.

Studying the inventory problems.

Building the dynamic inventory model.

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Determination of economic order quantity.

Determination of stock level.

Determination of safety stocks.

Selecting the proper system of ordering for inventory.

Ending up with the final inventory model, which will be solution for o
ur problem with
numerical example.

Information Flow System

Studying the information flow system of the company.

Detecting and identifying the problems and the area for improvemen

t.
Build the information system for the company with the improvement
s and
modifications.

Ending up with final information flow system, which will be the soluti
on for our
problem.
The information model deals with the integration of supply chain me
mbers and
concentrates on the flow of information among the chain members.
Information technology plays a vital role for increasing collaboration
among supply
chain members. From the information point of view the effective supp
ly chain
management must provide the right amount of relevant information t
o the right
person at the right time.
Information is the key to successful supply-chain management
because no product
flows until information flows.

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Benefits of Information Technology

Higher visibility
Reduced transportation spend
Immediate availability of information
Greater accuracy
More economic
Better customer service
Higher productivity
Reduced paper work
Faster processing

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Increase on-Time Deliveries


Improved Capacity Utilization

Information Requirements
To ensure that valuable, actionable knowledge readily flows across t
he supply chain,
information must be
Accessible
Relevant
Accurate
Timely
Transferable

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Suggested Improvements

Electronic pick slip report for the warehouse/ transportation

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Radio frequency identification (RFID)

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Positioning of the coca cola company

Co a ola o s

ore tha

of the orlds

e erages.

Coke is affordable in all the countries. It was not out of the price ran
ge for an
afternoon snack.
Coke comes in a variety of sizes worldwide so you can use it for a cro
wd or as a
personal snack drink

Coca-Cola is re og ized

y 94% of the orlds population

TARGET MARKET
Cokes commercials basically based on young generations, so, the yo
ung generation is

the target market of Coke because they want to represent Coke wit
h the youth and
energy but they also consider about the old people they take th
en as a co-target
market.

MAJOR SEGMENTS
Major segments are basically those people who take this drink daily
and those areas
where the demand are higher than the other areas. There are so m
any people who
take this drink daily and those people who take weekly and those wh
o take less often
are always there as well. So, their basic segments are those people w
ho take this drink
regularly.

FACTORS EFFECTING SALES


There are so many factors, which affects the sale of coke. Here we ar
e discussing three
major factors which effects coke.
Per capita income
Competitors
Weather

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PER CAPITA INCOME


First e ill dis uss a out Per apita i
o e . This is ajor fa tor
that affe ts the sale of
this soft drink. Because which every passing year budgets are becoming v
ery strict and tight
in order to purchase things. So the disposable incomes of the people are c
oming down. They

spend heavily on rents, utilities, and education and basic necessities a


nd after that when
they get extra money they think about this soft drink .So the decreasing
per capita income
effects badly in selling and production of this soft drink. And to get
through with this
difficulty there is need to increase the level of per capita income of Paki
stan because it is
much lesser than the rest of the countries.

FEATURES
Coke is having difference in taste than Pepsi due to having difference in
ingredients.
Coke has maintained global leadership in soft drink industry.
Coke is trying to focus on worldwide expansion of the cola market.
Coke must try to focus on its relationships with bottling subsidiaries.
Coke is facing a major challenge in developing countries that their
regional bottlers may
not have the financial resources to continue expansion.
The brands are trying to create world-wide economic developme
nt and population
growth to sustain sales and profits

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c) PRODUCT REVIEW
Coca-Cola has, and still, continued to reign in the consumers mar
ket stunning other
companies with their artistic and viewer-friendly commercials
Coke is having difference in taste
Coke has maintained global leadership in soft drink industry
Coke is trying to focus on worldwide expansion of the beverage mark
et

d) Competitive Review
BUYERS/CUSTOMERS
Coca-Cola has three major and large customers in the market, food str
eet 60,000 cerates
/year, McDonalds 40,000 cerates/year and Pakistan Railways who buy
50,000 cerates /year.
However, these three customers being large and powerful are in
an influential and
bargaining position they can demand discount or others faci
lities like (boards
sign/freezers/coolers etc.) and impose a threat to switch to their
closest rival and
competitor Pepsi.

SUBSTITUTES
Nestle products like juices, coffee, mineral water etc. and Shezan juices
are substitutes of
Coke for health conscious people and other fresh juices.

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RIVALS/COMPETITORS
DIRECT COMPETITORS
The direct competitor of Coca-Cola is Pepsi and that of CCBPL is PCI (Pepsi
cola international)
there is always ongoing tuff competition between these two arch rivals
with Pepsi leading
with 54% market share and Coke gradually growing and catching up 36
% market share in
Pakistan. However on global level the situation is reverse. Both companie
s often engage in
price cut wars, prize scheme wars and sponsorship wars to win over each
other customers.

INDIRECT COMPETITORS
These include Nestle and Shezan juices that do not pose a threat to
Coke as yet but
has the potential to do so as it is exploiting the natural aspect and h
ealth issues more
a d ore to ake people o s ious a out physi al fit ess Coke has
lau
hed Diet
Coke to ou ter the physi al fit ess de a ds.

BUFFERING AND SMOOTHING


For beverages like Coke the buffering and smoothing policies does t
matter and they
dont apply anymore because Coke remains in demand all the year ro
und in festivals,
parties, events, meetings sports etc.

SUPPLIERS
Coca-Cola has authorized suppliers and which do not pose a threat to
it. Anyhow Coke
does have a quality check procedures in its plants to ensure that t
hey get the right
kind of ingredients from suppliers.

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NEW ENTRANTS
Coca-Cola is not afraid of competing .it doesnt fear losing its share
to Mecca- Cola or
other new entrants. The company management believes that new e
ntrants provoke
healthy competition, which will provide Coke with a challenge to hol
d on to its loyal
customers. Besides it will take a lot of effort on the part of new entr
ants like MeccaCola, Pak-cola to fully launch its product in Pakistan and capture
or even motivate
people to switch on to their new product from Coke.

COMPETITIVE ADVANTAGES
BRAND NAME, SYMBOL, BOTTLE SHAPE.
Brand name, symbol and bottle shape are distinctive features of Coca
-Cola which give
it an edge over its competitors. (Even without name people can easil
y identify Cokes,
fantas, and sprites bottle from crowd.) They cannot be copied or imi
tated by others.

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Images of The Coca Cola Company Timeline

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Plant Bottle Manufacturing Process

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Value Chain Process

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