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Coca-Cola: Global Supply Chain Essay

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Updated: Feb 26th, 2022

The Coca-Cola Enterprise (CCE) produces and distributes billions of soft drink bottles annually all over the world. This makes the company’s supply chain a critical part of its business system. The supply chain structure is eminent in the procurement, manufacturing, distribution, and sustainability processes (Brondoni 20). In all the processes involved, CCE continues to make efforts to minimize the potential environmental impact from the procurement of raw materials and production of soft drinks to delivery to consumers. According to Supply Chain Overview, the Coca-Cola drink is distributed to partner plants as a concentrate, which is then manufactured into syrup and, subsequently, the final drink alongside other ingredients locally sourced by the respective plants.

In the case of sugar used for manufacturing, CCE’s partners always choose the preferred type, which is then used for the entire local market (“Supply Chain Overview”). America, for example, uses corn syrup while Europe and Asia use beet sugar and cane sugar respectively. The reason behind sourcing locally by CCE is to optimize the supply chain, therefore ensuring that less time is spent to deliver sugar and other raw materials to the processing plants. Besides, this initiative reduces the number of risks throughout the supply chain. Coca-Cola also seeks to have an impact on the socio-economic development within the communities where it operates.

One of the areas that the CCE places importance on is the partnerships it forms with suppliers to ensure that the products are delivered faster to local stores (“Supply Chain Overview”). For distribution, the company employs a Direct to Store Delivery (DSD) system in which the local manufacturers distribute Coca-Cola products from the production facilities directly to retail stores, therefore eliminating the need for distributors. The DSD system guarantees the availability of Coca-Cola products in stock to drive sales. On the other hand, the company hires professionals to support small format outlets and retail store owners. The system also allows the company to cut out secondary and tertiary distributors, which lowers the chances of product damage.

Global companies are facing pressure to employ corporate social responsibility, which includes addressing environmental issues that appeal to increasingly conscious consumers. The company should develop measures to significantly reduce carbon emissions across all its operations, such as material sourcing, manufacturing, packaging, storage, and distribution in all its existing markets. Additionally, the company may improve its ability to track and calculate lead times as part of its supply chain management. This has only been achieved in its largest bottler in the United States through the adoption of real-time supply chain insights technology. The replication of such investment in other markets will enhance fast delivery times, hence increasing customer satisfaction and driving sales.

Coca-Cola has maintained its global supply chain for decades and continues to optimize and modernize it in all its countries of operation. With increasing consumption of soft drinks, the focus of the company’s supply chain should be on how to manage its partner companies and facilitate the smooth distribution of products to the various points of sale. The journey of each bottle produced by the company begins when raw ingredients enter the factory and ends with the bottles chilling in the fridge at the retail stores. This supply chain process is made seamless and successful through innovation, collaboration, sustainability, and efficiency.

Works Cited

Brondoni, Silvio M. “Shareowners, Stakeholders & the Global Oversize Economy. The Coca-Cola Company Case.” Symphonya. Emerging Issues in Management, no. 1, 2020, pp. 16–27.

Coca-Cola HBC, 2020, Web.

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