Coca Cola

PRIMARY ACTIVITIES:

1. Inbound logistics include functions like receiving, warehousing, and managing inventory.

Water is the main ingredient for all products manufactured by Coca Cola Company and the company
occasionally faces significant challenges in accessing this particular raw material. Coca Cola uses high
fructose corn syrup (HFCS) extensively and this raw material is purchased from US-based suppliers and
delivered via trucks, In Europe, mainly beet sugar is used. In Asia, cane sugar is used. There are also
some ingredients that have to be sourced internationally. For example, orange juice and orange juice
concentrate is sourced from Florida and Southern Hemisphere, particularly Brazil. For international
purchases inbound logistics are facilitated via ships and trucks.

Coca Cola Enterprises uses an Automated Storage and Retrieval System (ASRS) in many of its factories.

In this way, the facilities are designed to hold and automatically move nearly 30,000 pallets through the
warehouse. This doubles the site’s storage capacity and allows all manufactured products to be
delivered to the customers directly.

ASRS also addresses the inadequacies of traditional warehouse systems and equips facilities to
seamlessly handle finished products and track them with detailed precision everywhere from the
moment they are created to delivery at the designated outlet.

In addition to automating their warehouses, Coca-Cola is using robotics and automation to overhaul its
supply chain and logistics. They had integrated standardized automation into their production lines long
ago.

The goal of automation is to deliver an expanded and automated operational structure with larger
capacities, lower operation costs, and reduced materials handling.

2. Operations include procedures for converting raw materials into a finished product.

The Coca-Cola Company markets, manufactures and sells:

 beverage concentrates and syrups; and,

 finished beverages (including sparkling soft drinks; water and sports drinks; juice, dairy and
plant-based drinks; and tea and coffee).

In their concentrate operations, The Coca-Cola Company typically generates net operating revenues by
selling concentrates and syrups to authorized bottling partners.

Their bottling partners combine the concentrates with still and/or sparkling water, and/or sweeteners,
depending on the product, to prepare, package, sell and distribute finished beverages.

The finished product operations consist primarily of company-owned or -controlled bottling, sales and
distribution operations.
 3. Outbound logistics include activities to distribute a final product to a consumer.

According to official statistics, an amazing 1.9 billion products of Coca-Cola are sold around the world
every day and have approximately 225 bottling partners around the world.

The Company manufactures and sells concentrates, beverage bases and syrups to bottling operators. It
still however, owns the brand and is responsible for consumer brand marketing initiative. The bottling
partners manufacture, package and distribute the final branded beverages to customers and vending
partners, who then sell products to consumers.

All bottling partners work closely with suppliers- grocery stores, restaurants, convenience stores,
amongst many others- to execute localized strategies developed in partnership with Coca-Cola. More
precisely, although Coca-Cola is a global company, its products never have to travel far to reach the final
consumer, making the product more local than you may think, the product is made local to the market
where it is sold.

Their business is a local business, typically products aren’t shipped more than a few hundred miles; it’s
all about being responsive to the customers’ needs and the local tastes of the consumers in every
market. The Coca-Cola Company sells its products to bottling and canning operations, distributors,
fountain wholesalers and some fountain retailers. They then distribute them to retail outlets, corner
stores, restaurants, petrol stations and many more.

4.Marketing and sales include strategies to enhance visibility and target appropriate
customers—such as advertising, promotion, and pricing.

The marketing strategy of Coca Cola is a mix of three important elements – affordable prices, worldwide
accessibility, and great customer connection. The brand is present across more than 200 nations and is
sold in packages of various sizes. The products are priced competitively because of the heavy
competition in the soda industry.

Now, in the 21st century, the brand has focused on its global branding as one brand. Instead of branding
its products separately, the brand has brought all its products together in its ads. The ‘Taste the Feeling’
slogan is aimed at connecting with the millennial generation and its emotions. This strategy is like
moving into a new era for Coca Cola. The soda giant uses both traditional and digital channels to reach
its target market. Apart from print and TV ads, the brand is also using social media for striking deeper
connections. YouTube has more than 1300 videos uploaded by the soda brand. Several new videos have
been added as a part of the new “Taste the Feeling” campaign. These videos are in several languages
which reflects the market size of Coca Cola.

The promotional expenses of Coca Cola remain in billions per year. A very large part of Coca Cola’s
marketing budget is spent on digital advertising. In 2019, Coca Cola spent $4.25 billion on advertising
and promotions which was $133 million higher than the previous year.

5. Service includes programs to maintain products and enhance the consumer experience-like
customer service, maintenance, repair, refund, and exchange.

Coca Cola maintains its customer service practices via online chat with a virtual agent in official website
of the company dedicated customer service phone. Coca Cola website has a comprehensive FAQ that
covers the most aspects of their products in a detailed manner and the website also addresses a wide
range of rumors related to the brand direct and indirect ways.

Also, Coca-Cola is evolving its business strategy to become a total beverage company by giving people
more of the drinks they want –including low and no-sugar options across a wide array of categories –in
more packages sold in more locations.

Building a portfolio of “consumer-centric brands” requires shifting focus from what the company wants
to sell to what consumers want to buy.

SUPPORT ACTIVITIES:

1.Procurement concerns how a company obtains raw materials.

Coca Cola procures from thousands of farmers and suppliers. It uses technology to make the entire
process easier and efficient. It has maintained good relationships with its suppliers and provided
guidelines that the suppliers are required to follow

Some of Coca Cola’s most notable suppliers include Spherion, Jones Lang LaSalle, IBM, Ogilvy and
Mather, IMI Cornelius, and Prudential. These companies provide Coca Cola with materials such as
ingredients, packaging and machinery. In order to ensure that these materials are in satisfactory
condition, Coca-Cola has put certain standards in place which these suppliers must adhere to. These
include: compliance with laws and standards, laws and regulations, freedom of association and
collective bargaining, forced and child labor, abuse of labor, discrimination, wages and benefits, work
hours and overtime, health and safety, environment, and demonstration of compliance.

2. Technological development is used at a firm's research and development (R&D) stage-like

designing and developing manufacturing techniques and automating processes.

Coca Cola also maintains heavy focus on technology and research and development. From production
to distribution and sales, everywhere it has invested in technology. Apart from that it also focuses on
technological innovation through R&D. It has six R& D centers around the world that are connected to
external technology and assessment hubs connecting it with partners, tech startups and university
researchers. The company collaborates with partners in the other industries to fuel innovation across
products, packaging, equipment and the other things. In this way, Coca Cola is continuously focusing on
innovation for growth.

3. Human resources (HR) management involves hiring and retaining employees who will fulfill
the firm's business strategy and help design, market, and sell the product

This is also a very important area of Coca Cola’s value chain. The company has focused on hiring and
developing talent and creating an environment of learning and growth. It pays them good salaries and
also complements the payments with rewards. Coca cola focuses on employee motivation and
engagement. Apart from it, the focus is on performance management to provide the employees with
career growth.

4. Infrastructure includes company systems and the composition of its management team—
such as planning, accounting, finance, and quality control.

The role of a firm’s infrastructure is central to its success. Coca Cola has managed a large infrastructure
including its management, human resources, financial and technological infrastructure. It is also
educating its suppliers and focusing on innovation through its R&D centers.

COST ADVANTAGE

 Step 1. Identify the firm's primary and support activities.

Step 2. Establish the relative importance of each activity in the total cost of the product.

Step 3. Identify cost drivers for each activity.

Step 4. Identify links between activities.

Step 5. Identify opportunities for reducing costs.

DIFFERENTIATION ADVANTAGE to create or have position in the market

• Step 1. Identify the customers' value-creating activities.

The Coca cola enterprise generates revenue by selling concentrates and syrup to bottling
facilities around the world and by selling finished product to retailers and other distributors
that’s why the operation, inbound and outbound logistic is the most valuable creating activities
• Step 2. Evaluate the differentiation strategies for improving
 improve water efficiency in manufacturing operations
Because every Coca-Cola product is made using water, issues with water supplies and
quality could also impact the business.

 Continuous s


 Support in Research and Development

Since Coca Cola is a “consumer-centric brands” it requires shifting focus from what the
company wants to sell to what consumers want to buy.

• Step 3. Identify the best sustainable differentiation.

REFERENCES:

https://www.coca-colacompany.com/company/coca-cola-system

https://notesmatic.com/marketing-strategy-of-coca-cola

https://investors.coca-colacompany.com/financial-information/balance-sheet