Coca cola giants
Coca-cola formula can be derived from an entity created by Asa Candler in 1886 and incorporated The Coca-Cola Company in 1892. The foundation has challenged tests of time after it grew to a multinational corporation entailing syrup and concentrates production. It is not easy to structure a convenient chain of distribution internationally; market is liable to some limitation dating from political to cultural influences. The company is involved in the manufacture of more than five hundred products in different countries across the globe. The Coca-Cola Company specializes in syrup production only; the juice is distributed to bottling companies, usually regarded as the franchisees that use it to make sodas in different stations all over the globe. The latter is involved in the manufacture of major soft drink concentrates and syrup implies that Coca-cola does not manufacture the final soft drink.
The chain of distribution entails a process of organizing, implementing substantial control by conserving goods or services and enhancing communication at different levels with obligations to conform to customers’ requirements and expectations. Coca-cola operations can be segmented into different categories that are required to conform to enhance the chain of distribution in The Coca-cola Company:Public and private operations Primary and tertiary segments, manufacturing, retailing and wholesale trade construction, mining quarrying and farming, Financial, services and transport.
Distribution process is initiated by the clients’ order; the company henceforth is committed to produce consumer requirements in the best practices, goods go through storage and distribution process before they reach to customers and the process starts all over again. The list below indicates different processes necessary in a distribution chain and aided by information service network:-Customer order, Processing order, Inventory, Plan forward, Transportation, Storage, and Customer relations and concern
Customer orders are imperative and a quick channel of distribution improves the image of a company. Coca-coal product’s are available any time anywhere hence a commendable chain of distribution. Customer satisfaction makes them come back for more. Some steps in the distribution channel may be snubbed to quicken customer attendance and reduce the cost of production. Market demand, transport opportunities, customers regards and cost constrains are setbacks in a successful mode. They are variable hence affecting distribution costs at unpredictable rates.
It is controlled by customer requirements and market situations. The amount of products to produce and the process incurred structures distribution chain. Quality control and human resource consideration depicts good practices. The volume capacity and product quality are dominant factors in production. Operational activities during production should be structured in a convenient dimension; they include work offloads and maintenance. Recent study indicates that Coca-cola serves 1.6 billion clients in a day. The chain of distribution facilitates constant supply of these products. The company has been able to influence local distribution networks where almost 80% of its sales are from products bearing the original concentrates “coke” label. Acquired companies are a channel of improving distribution coverage. Twenty eight percentage amount from the sale of affiliated products from acquired organizations. Coca-cola acquired Columbia Pictures in 1982, the first non-beverage investment; the firm was later sold to Sony for a deal double its cost. Coca-cola has integrated international chain of distribution into regions bearing different aspects.
supply entails what a company can produce without constrains while maintaining high quality. A company that produces every component of a product is profitable than a company that relies on parts. \raw materials suppliers will determine the end product committing producers to be on the look out on the quality of materials. Economical, quality and flexible supplier is recommended. The company has brilliant means of acquiring raw materials to produce concentrates. Water and sweeteners are used in bottling companies. Material management entails a process where the company strategizes purchase process. The availability of raw materials is critical to production. Coca-cola produces raw materials at different levels and at different localities; it is therefore important to have a strategy on material management.
Good purchasing Organization is essential in the supply chain to promote continuity in the production. Supply chain can be defined as the process through which products are shifted to clients order from their initial state as deposits through supply as raw materials to production and hence distribution to the customers. The intense of this chain is determined by the size of the nature of products and the size of the firm. The chain links different process that the final product has to undergo before its final destiny. Coca-cola is a multinational company with billion of customers in all parts of the globe, the intense of the chain of distribution is therefore integrated according to different aspects. The chain of distribution is all about managing several concurrent events in a distribution system. Coordination in different magnitudes and levels requires discipline in order to retain customer confidence and at the same time identify channels of growth to other regions. The company is able to serve two billion clients every day. The concentrates are produced in contained situations in the U.S and distribution strategy ensures that it reaches to every corner constantly.
The amount of products to be stocked is determined by the market demand. The amount of deposit at any distribution chain should meet market demand and not be too clumsy for the company. The company has restructured the chain of management and it is anticipated that it will affect the in inventory process. Several processes in distribution are to be omitted to quicken distribution and reduce the cost of distribution, customers demand will also be addressed. Hiking price of oil has affected chain of distribution negatively. Coca-cola has confidence on package and distribution department, escalating cost of fuel is shared among the stakeholder who participates in soft drink manufacture.
The company shares such risk with participants where the company surrenders some returns to aid in combating economic crisis and hiking fuel prices. The company has so far identified thirty nine lobbyists in different firms. The company has faced criticism ideologies from discrimination and monopoly. China refused to recognize Coca-cola appeal to acquire Huiyan Juice Company as it would exercise monopoly in the system. The Middle East on the other side does not honor Coca-cola presence due to a different perception on American policies relating military operations in the region. An Indian NGO identified traces of pollution in chemicals deposited by Coca-cola firms where clients were discouraged from cancer causing elements in Coca-cola products, the demand of Coca-cola products decreased by ten percent. Intense demand of water in the company’s operations in different region has contributed to scrap for resources where local community is opposed to the company’s missions.
Customer requirements and market demand may dictate the location of a firm. Production, bottling and ware houses are located near reach. In medium companies, production may be created to favor customer reach and in heavy companies, it may be structured in locations that favor easy reach of raw materials. A company obligated to attend to such crowd requires a channel of distribution that can reach out to this monster like demand across the globe. Coca-cola has ventured into channels that can improve products sales. The concentrate is packed by franchisees where The Coca-cola Company engages in the branding where bottling factories and distribution network operations are sought in marginalized areas. The company has achieved such transformation from a mission that respects, understands and appreciates diverse cultural differences all over the world. Multinational companies have huge capital bases that can be used to manipulate weak political hierarchy and acquire smaller companies that dominate niche market.
Coca-cola has acquired Minute Maid, Barqs Odwalla, and Fuze Beverages before loosing Huiyan Juice Group from China in 2008. China has been conservative on multinational system and has rejected several deals from outsiders. The company promotes and assists in the sale of brands from acquired companies with an aim of grabbing current chain of distribution in areas they are not recognized, market penetration is done from within.
The urgency of consumer requirement determines the intensity of products transfer. The speed and cost of transportation are used to determine the perfect channel of distribution. Coca-cola has utilized identified chain of distribution where it acquires minor companies in a market. Transport is crucial in the whole production process as it is done in different places. The end product need to reach to the consumer, concentrates requires to be distributed constantly to bottlers allover the globe, machine spares, office equipments requires a distribution system.
The chain of distribution of materials to finished products requires a coherent basement to execute relevant duties efficiently. Purchasing may be explained as a process where client’s identifies the right product, supplier and product evaluation. The clients then negotiate the cost and identifies relevant mean of delivery. The chain of distribution is classified according to different brands the company produces.Coca-cola produces five hundreds brands in over two hundred countries. Fanta and sprite brands were discovered in World War II when Max Keith the brand manager in Germany produced a different brand to extort money from Nazis. 7 Up and Valpre reflect examples of Coca-cola concentrates. In the 90s, the company was vigorously influenced by market demand to produce healthy beverages Minute Maid, Dasani and Fruitopia were designed. C2 cola was produced to cater for non-sugar and diabetic clients.
Consumer reactions towards a product are highly valued as it notifies the producers where to improve to meet the client expectation. Modern means of interaction has transformed the way business is conducted. Coca-cola has adopted modern mean in purchases, they are cheap and efficient. Internet marketing is a modern tool where Information Technology (IT) and SCM are used to enhance distribution. The company’s profile has a client enabled system where they can view different products and make a sale online; the products are delivered to their doorstep through a system of trusted and punctual courier services. Social networking is a form of market research where clients place their comments and aid the company in improving its brands offering. System Operations management impacts distribution channels in different ways. Internet and technological advance is liable to intruders who harm the network intentionally. Malware, hackers and cyber thieves can penetrate in the system internally and/or externally and manipulate the company or clients information. Security measures of all dimensions are essential in a network and personal passwords, security guard to confidential databases and key cards are form of security measures in IT. The staff and clients should also be educated on security matters in the system.
The Company is involved in the management of production, packaging and distribution arena though. Sugar production and prices is a major determinant of revenues in the company as it is the main ingredient used to refine concentrates to end products (sodas). In simple terms, the company produces concentrates and the syrup, the syrup is sold to trusted bottlers who owns franchise all over the market, bottlers use filtered waters and sweeteners to produced ready-to-drink sodas in bottles and cans, finished products are sold to retailers, restaurants, vendors and other facilities engaging n food production. Market segmentations by political boundaries are recognized as territories with two billion consumers in twenty four hours.
Coca-cola produces mainly the syrup and concentrates that is later manufactured and distributed to the market. The company was recognized as the first brand to hit top one billion Euros in the U.K. In the U.S, the company has direct link to authority generals where it negotiates for favorable beverage atmosphere in the region. Due to the constant positive performance the company has manifested, the government is also obligated to recognize Coca-cola as it carries the flag high across the globe. American government ahs intervened in several situations in favor of Coca-cola. The company spends about $1 million in atrium missions and the figure hit $4.5 million in 2009. Increased levies on soft drinks remains a major challenge where the company is obligated to lobby government officials.