Summary
The section discusses the nature of business operations done at Coca-Cola. It is divided into areas named ‘our businesses, ‘critical accounting policies and estimates, ‘operations review’, and ‘liquidity, capital resources, and financial position’ (Coca-Cola Company, 2021). Coca-Cola sells its nonalcoholic drinks to over 200 territories and countries worldwide (Coca-Cola Company, 2021). The company’s trademarks account for 1.9 billion of all the 62 billion beverage servings around the world (Coca-Cola Company, 2021). It markets and sells concentrates, which account for 52% and 82% of revenues and volume, respectively and sparkling soft water products that take up the rest of revenues and sales volume (Coca-Cola Company, 2021).
Coca-Cola prepares its financial documents in compliance with the U.S. GAAP while emphasizing consolidation principles, assets recoverability, pension plan valuations, revenue recognition, and income taxes (Coca-Cola Company, 2021). The company uses price, product, and geographical mix in its marketing across Latin America, North America, Asia Pacific, Global Ventures, Bottling Investment, and Europe, Middle East and Africa business divisions (Coca-Cola Company, 2021).
COVID-19 Impact on Consumer, Customer, Teammate and Community Safety and Expected COVID-19 Impact on the Company
Covid-19 has shifted Coca-Cola’s customer consumption from away-from-home to indoor and more-at-home. Nevertheless, the company focused on employee safety, community welfare, continued brand supply, product safety and quality, and customer services (Coca-Cola Company, 2021). As a strategic plan of emerging from the pandemic victoriously, the organization strengthened its three core capabilities, which are consumer marketing, franchise, and commercial leadership.
The impacts expected from the spread of coronavirus include reduced sales for both at-home and away-from-home beverages, lower profit margins as demand shifts from profitable brands, disruptions in concentrate production in a bid to guard employees’ safety, and shipping delays (Coca-Cola Company, 2021).
Costs
- Sweeteners and packaging are variable costs because they increase and decrease with the quantity of production and volume of sales, respectively. An increase in the per-unit cost of packaging and sweeteners will lower the contribution margin due to the higher variable costs factor. Decreases in the contribution margin will lead to falling profitability for the organization.
- Marketing costs at Coca-Cola are a mix of variable and fixed costs, as specific campaigns do not depend on sales or production volumes. Periodic marketing is the fixed component while brand-specific campaigns form part of the variable costs.
- The unit cases of the finished product (bottles and cans of Coke sold by bottlers) represent Coca-Cola’s activity index as it represents the final product delivered to the consumer. However, both measures have a direct impact on the company’s behavior of costs.
FedEx Corp
The company’s primary product lines include transportation, delivery services, freight services, and corporate services that support marketing, IT, sales, billing and collection, communications, and other back-office roles (FedEx Corporation, 2020).
COVID-19 Pandemic
Since FedEx is a transportation business, it is recognized as an essential service worldwide, handling the delivery of important items, such as PPEs. The three interesting things about the section include plausible steps taken by FedEx to fight the pandemic, increasing business demand during such difficult economic times, and the company’s role in providing employment when others are laying off their workers (FedEx Corporation, 2020).
Strategy
The notable things under the strategy section are FedEx’s ability to maintain collaboration among companies that operate under the brand while competing collectively, focus on five business areas (e-commerce, business to business shipping, operational excellence, international profitability, and revenue quality), and development of key innovative solutions (FedEx Corporation, 2020).
Reputation and Responsibility
FedEx is listed as the best employer and workplace in the Fortune 100 and Forbes list of 2019 (FedEx Corporation, 2020). It embraces diversity, inclusion, career development, and balanced lifestyles for its employees. The company serves the community in three areas, which are: global entrepreneurship, delivery for good, and sustainable logistics. It invested $200 million to support 200 global communities in a six-month period in 2020 (FedEx Corporation, 2020). FedEx conserves the environment through its ‘reduce, replace, revolutionize’ environmental strategy (FedEx Corporation, 2020).
References
Coca-Cola Company. (2021). The Coca-Cola Company and subsidiaries.Coca-Cola. Web.
FedEx Corporation. (2020). 2020 Annual Report.FedEx. Web.