Downstream Report Of The Coca-Cola Company
Downstream Report of the Coca-Cola Company
The Coca Cola Company, one of the largest beverage companies, provides nearly 400 beverage products in more than 200 countries on six continents. Its consistently success lies in its competitive strengths, such as a worldwide network of bottlers and distributors of company products, powerful brand influence, and up to date marketing strategy. The company itself is mainly responsible for creating and marketing its brands, while its 300 worldwide bottling partners produce and distribute the beverage products to retail and wholesale customers.
The company subcontracts the distribution rights to worldwide bottling partners through signing distribution agreements. The distribution agreements generally authorize the bottling partners to distribute the company’s beverage products in identified territories. The company relies on its worldwide local bottling partners to sell and deliver beverage products to the retail chains, supermarkets, vending machine distribution channels and so on. Since its bottling partners are local companies, they fully understand the distribution channel and retail environment in the local market. They help the company to reach its 6 billion consumers all over the world. For example, in Indonesia, boats transport the company beverage products between hundreds of islands. In China, the products are delivered by trucks. In 2005, the products produced and distributed by the bottling partners in which the company doesn’t have controlling interests account for about 83 percent of its worldwide unit case volume.
However, this century-old traditional distribution model is now being altered by the trend toward consolidation in the retail channel, starting from the United States. The company has agreed to deliver its Powerade sports drink to Wal-Mart warehouse, rather than direct to its stores. The bottling partners will still produce the beverage product, but...
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