馃攳
Coca Cola鈥檚 Distribution Strategy | Case Study - YouTube
Channel: unknown
[0]
coca-cola's business and distribution
[2]
strategy
[3]
according to official statistics 1.9
[6]
billion coca-cola products are sold
[8]
around the world every day
[10]
the coca-cola company is a global
[13]
business that operates on a local scale
[16]
the company is able to create a global
[18]
reach with local focus because of the
[20]
strength of its system which comprises
[22]
the coca-cola company and their more
[24]
than 250 bottling partners worldwide
[27]
the system has numerous legal managerial
[30]
departments and sections all independent
[32]
of each other and it does not own or
[34]
control all of its bottling partners
[36]
worldwide
[38]
while it is generally perceived that
[39]
coca-cola runs all its operations
[42]
globally this process is done through
[44]
various local channels
[46]
coca-cola typically agrees to refrain
[49]
from selling or distributing or from
[51]
authorized third parties to sell or
[53]
distribute the company trademark
[55]
beverages throughout the identified
[56]
territory to guarantee bottling partner
[59]
exclusivity under that territory and
[61]
product
[62]
however coca-cola typically reserves for
[65]
itself the right to manufacture and
[67]
distribute its trademark products and
[69]
brands
[70]
in exchange coca-cola also participates
[73]
in the sales and marketing activities of
[75]
its bottling partners
[77]
for instance in 2019 coca-cola spent 4.4
[82]
billion dollars in promotional and
[84]
marketing programs with bottling
[86]
partners
[87]
the bottling partners manufacture
[89]
package and distribute the final branded
[91]
beverages to customers and vending
[93]
partners who then sell products to
[95]
consumers
[97]
all bottling partners work closely with
[99]
suppliers grocery stores restaurants
[102]
convenience stores amongst many others
[105]
to execute localized strategies
[107]
developed in partnership with coca-cola
[110]
more precisely although coca-cola is a
[112]
global company its products never have
[115]
to travel far to reach the final
[117]
consumer making the product more local
[119]
than you may think the product is made
[121]
local to the market where it is sold
[124]
their business is a local business
[126]
typically products aren't shipped more
[128]
than a few hundred miles it's all about
[130]
being responsive to the customers needs
[132]
and the local tastes of the consumers in
[134]
every market
[136]
the coca-cola company sells its products
[138]
to bottling and canning operations
[141]
distributors fountain wholesalers and
[143]
some fountain retailers
[145]
they then distribute them to retail
[147]
outlets corner stores restaurants petrol
[150]
stations and many more
[153]
coca-cola short-term chain long-term
[155]
franchise model
[157]
the strategy of coca-cola and it comes
[159]
to building growing and maintaining its
[162]
distribution system is pretty fluid
[165]
indeed in most cases coca-cola leverages
[168]
a network of independent bottling
[170]
partners
[171]
in some cases coca-cola places strategic
[174]
investments in some of the bottling
[176]
partners operations
[178]
it does that either to enable the entry
[180]
in a local market by leveraging on
[183]
coca-cola's group resources or to
[185]
maintain control on the bottling partner
[188]
in the long-term coca-cola will divest
[190]
at stake as the bottling partner
[192]
operations take off thus enabling
[194]
coca-cola to keep its capital
[196]
requirements low while keeping a minor
[198]
stake in the bottling partner thus
[200]
guaranteeing control and cooperation
[203]
therefore the distribution system and
[206]
the bottling partners are organized as a
[208]
hybrid approach between chain and
[210]
franchise
[212]
where in the short term coca-cola acts
[214]
as a chain of bottling companies
[217]
in the long term it acts more like
[219]
franchising where bottling partners are
[221]
kept mostly independent yet tied to the
[224]
coca-cola brand this mixed distribution
[227]
system of owned and non-owned bottling
[229]
partners is the coca-cola system which
[232]
sold 30.3 billion unit cases by 2019
[237]
trademark coca-cola accounted for 43
[239]
percent of u.s unit case volume
[242]
refranchising or going franchise
[246]
for instance in 2019 coca-cola acquired
[249]
the controlling interests in bottling
[251]
operations in zambia kenya and eswatini
[255]
as those bottling operations will become
[258]
stable and established over time
[260]
coca-cola will re-franchise them
[263]
therefore it will sell its controlling
[265]
stake having a franchisor franchisee
[267]
relationship with those bottling
[269]
partners and in some cases it might keep
[272]
a minor equity stake to keep more
[274]
control over the operations
[276]
in 2018 for instance coca-cola had a few
[280]
hundred million in proceeds as it
[282]
re-franchised its canadian and latin
[284]
american bottling operations
[286]
this is how coca-cola keeps its capex
[289]
low while still keeping control of the
[291]
bottling operations and yet enabling
[293]
expansion and capillary distribution
[296]
let me know what you think about the
[298]
video in the comments it will help me to
[300]
make more videos for you and thank you
[302]
for watching
Most Recent Videos:
You can go back to the homepage right here: Homepage