Supply chain management on Coca cola

Supply Chain Management 1
University of Lahore
Table of Contents
Industry Type and its detail......................................................................................................................3
History of the company ...........................................................................................................................3
Mission ...............................................................................................................................................4
Vision..................................................................................................................................................4
Objectives ...........................................................................................................................................5
Detail of products and processes..............................................................................................................5
Detail of customers ............................................................................................................................6
Detail of competitors ...........................................................................................................................6
Detail of different departments and functional areas including supply chain management department of
the company............................................................................................................................................6
Human Resource Department ..............................................................................................................7
Marketing Department.........................................................................................................................7
Sales Department.................................................................................................................................7
Finance Department.............................................................................................................................8
Supply chain strategy of the company......................................................................................................8
Why do you want to do this project? ....................................................................................................8
How will it contribute to the industry/managers and owners? ...............................................................8
How will it contribute to the existing literature on supply chain management? .....................................8
Detail of production facilities ..................................................................................................................9
Water treatment ...................................................................................................................................9
The syrup ............................................................................................................................................9
Filling and packaging ..........................................................................................................................9
Location strategies of the company with justification.............................................................................10
Layout strategies of the company with justification................................................................................11
Factors affecting location decisions of company ................................................................................12

Factors affecting layout decision of company.....................................................................................12
Sourcing decisions of the company........................................................................................................13
Upstream and downstream activities......................................................................................................14
Detail of suppliers .................................................................................................................................14
Supplier selection criteria ..................................................................................................................15
Supplier selection process and strategies ............................................................................................16
Supplier relationship management strategies..........................................................................................16
Detail of sourcing related documents of the company ............................................................................16
Inventory management practices of the company...................................................................................16
Detail of warehouses/storage facilities ...............................................................................................16
Detail of storage decisions .................................................................................................................17
Inventory holding decisions & handling decisions..............................................................................17
Inventory ordering decisions..............................................................................................................17
Inventory/material handling equipment..............................................................................................18
Inventory record accuracy strategies ..................................................................................................18
Information flow chart and Material flow chart of the company .........................................................18
Value chain analysis of the company .....................................................................................................19
Transportation network of the company.................................................................................................19
Distribution network design of the company..........................................................................................19
PROBLEMS BEING FACED BY COCA-COLA COMPANY..............................................................21
Recommendations .................................................................................................................................22
Conclusion ............................................................................................................................................23

Industry Type and its detail
Coca-Cola is one of the largest beverage producing company. It distributes and markets more
than 500 non-alcoholic brands of beverages. The Coca-Cola Company is the world’s leading
manufacturer, marketer and distributor of non-alcoholic beverages, concentrates and syrups.
It was founded in 1886. The Company’s corporate headquarters are in Atlanta, with local
operations in around 200 countries in the world. Although Coca-Cola was first created in the
United States, it quickly became popular wherever it went. The real reason that Coca-Cola is
a true global company is that the products meet the varied taste and preferences of
consumers everywhere.
Its primary business runs around sparkling beverage brands like Coca-Cola, Diet Coke, Sprite
and Fanta, but it also produces and licenses a variety of other beverages like waters, juices
and juice drinks, enhanced waters, energy and sports drinks and ready-to-drink teas and
coffees. The beverages being their trademarks are now currently sold in almost 200 countries
worldwide.
Coca-Cola makes its beverages available to consumers around the world through its vast and
efficient distribution systems. These are either company-owned or controlled bottling plants
which conduct operations. Their distribution network also includes many independent
bottling partners, distributors, wholesalers and retailers. Coca-Cola owns about 1.9 billion of
the 57 billion serving of beverages of all types of drinks consumed worldwide every day.
The success of Coca-Cola has long and still possible because of its ability to connect with its
customers in meeting their desires and lifestyle preferences by the consumption of various
variety of beverages that is offers. It further is successful die to efficient teamwork of the
company’s people working effectively in serving the customers every day.
History of the company
During 1886, a pharmacist in Atlanta, Dr. John Pemberton, created a unique flavored drink
that could be sold at soda fountains. The flavored syrup was mixed with carbonated water
and served to the customers. Coca-Cola was sold for 5 cents per serving then and sales during
the first year were on an average of servings per day. Today, daily servings of Coca-Cola
beverages around the globe estimates to be 1.9 billion per day. Frank Robinson was Dr.
Pemberton’s partner. He was his bookkeeper by profession but he is the one who named the

famous drink as “Coca-Cola”. He also designed the script of the way the name of the brand is
still showcased today.Dr. Pemberton passed away just two years after creating this world’s best-
selling beverage in 1888. During these two years, he sold ports of his business to various
businessmen, with Mr.’s Candler, a businessman of Atlanta, having the majority interest. His
leadership skills helped him to widen the distribution of Coca-Cola to soda fountain outside of
Atlanta as well. By 1894, demand for Coca-Cola increased dramatically because of which Joseph
Beidenharn installed a bottling machinery to make the drink more portable. He installed it just
behind his soda fountain in Mississippi. In just five years, Coca-Cola’s large scale production and
distribution began to take place. In 1899, three entrepreneurs, Benjamin Thomas, John
Lupton and Joseph Whitehead purchased the bottling rights from Mr. Candler for $1 to
exclusively sell and bottle Coca-Cola. This is when the worldwide distribution of Coca-Cola
began (Mattes 1994).The biggest challenge faced then was the duplication and imitations of the
Coca-Cola by competitors who reflected inefficient packaging. Around 1000 bottling plants were
operating at that time among the competitors of Coca-Cola5. In 1916, Coca-Cola bottlers decided
that the unique drink needed a distinct and standard bottle and thus developed the famous contour
bottle. The new bottle was easily recognizable as a distinct brand and made Coca-Cola a unique
brand different from its competitors. In 1977, Coca-Cola trademarked its contour bottle (Mattes
1994).Early marketing efforts of Coca-Cola were put to action through the distribution of coupons
which promoted free samples of the Coca-Cola. As this type of promotion was innovative during
the late 1880s, following this, newspaper advertising and promotional items were also distributed
containing the Coca-Cola script to various participant pharmacies.
Mission
 To refresh the world
 To inspire moments of happiness and optimism
 To create value and make a difference
Vision
People: Be a great place to work where people are inspired to be the best they can be.
Portfolio: Bring to the world a portfolio of quality beverage brands that anticipate and satisfy
people's desires and needs.
Partners: Nurture a winning network of customers and suppliers, together we create mutual,
enduring value.

Planet: Be a responsible citizen that makes a difference by helping build and support sustainable
communities.
Profit: Maximize long-term return to shareowners while being mindful of our overall
responsibilities.
Productivity: Be a highly effective, lean and fast-moving organization.
Objectives
The main objectives for the Coca-Cola Company are to be globally known as a business that
conducts business responsibility and ethically and to accelerate sustainable growth to operate in
tomorrow's world. By having these objectives, it forms the foundation for companies in the
decision making process.
Detail of products and processes
Coca-Cola established its facilities in Pakistan in 1953. It operates locally within Pakistan. Its
products are produced locally, thus providing employment to hundreds of Pakistani residents.
The company focuses its marketing and advertising specifically to Pakistani tastes and
cultures. Coca-Cola Beverages Pakistan Limited’s (CCBPL) major shareholder is Turkey’s Coca
Cola Icecap (CCI). CCI is currently bottling and distributing alcohol-free beverages in Pakistan
along with 9 other countries. Besides these, Sprite Zero, Rani Float and Kinley Bottled water are
also in company’s product portfolio. The company’s bottling plant is located in Pakistan in
different regions, including Karachi and Islamabad. Its local office is also engaged in the marketing
and advertising activities related to its products across Pakistan. After arriving in Pakistan, Coca

Cola was bottles and distributed via independent franchisees. In 1996, Coca-Cola took the initiate
to consolidate and acquire all the bottling plants and operate hem under the company’s own
supervision. This process of acquisition was completed in 2006 and CCBPL became the only
organization responsible to bottle and distribute Coca-Cola products across Pakistan. CCBPL
ensures that quality products are delivered to its customers. This includes investment in the market,
customer development, timely order and cash collections. By 2013, CCBPL has 6 bottling plants
and 13 warehouses operating across Pakistan thereby serving its 180 million population via its vast
distributors and retailers
Detail of customers
Our customers include large international chains of retailers and restaurants and small independent
businesses. We work with them equally to create mutual benefit. Together with our bottling
partners, we serve our customers through account management teams, providing services and
support tailored to their needs. Trainings, support programs, regular visits, plant visits, Coca-Cola
Customer Road Show, Customer Satisfaction Survey, CCI Call Centre, Focus group studies.
Distributor meetings, Process improvement studies, regular visits, training programs, plant visits,
Distributor
portal, Call Centre
Detail of competitors
The greatest challenge that Coca-Cola face is the competitive pressure from rival sellers.
PepsiCo is the main competitor for Coca-Cola and these two brands have been in a power
struggle for more than a century. Although Coca-Cola owns four of the top five soft drink brands
(Coca-Cola, Diet Coke, Fanta, and Sprite If we consider brand loyalty, Pepsi has more loyal
Customers than Coca-Cola. Diet Pepsi has highest ranking in diet soft drinks. Pepsi coke has
highest ranking in regular coke. Whereas diet coke which is the highest ranking brand of Coca-
Cola has very low ranking as compare to Pepsi according to the Brand Keys Customer Loyalty
Survey.
Detail of different departments and functional areas including supply chain
management department of the company.
Supply Chain follows the different Stages a typical supply chain may involve a variety of stages
Customers

Retailers
Wholesales/distributors
Manufacturers/Plants
Component/raw material suppliers
Human Resource Department
The HR department performs the role of recruiting the efficient employees and financial
consultants for the company. It gets the resume of applicants and processes it to check for its
eligibility criteria, after that put that resume for the further processing of selection.
Marketing Department
Marketing department takes care of the marketing of all the products of the company. It helps in
the increase of the business. It plays the major role in making the people aware of their product. It
concentrates on making the strategies of how to increase the sales of the products.
Sales Department
Controlling the sales force that brings the business to the company. Maintain the regular flow of
information about the product. These are sales manager only who see after the acquiring and
maintaining their agents.

Finance Department
This department keeps the proper track record of all the transactions taking place. It maintains the
record of all the insurance policies being issued and their premium payments.
Supply chain strategy of the company
Supply chain strategy of the Coca-Cola is to achieve efficiency and make to stock strategy.
Efficiency of Coca-Cola’s Capital Structure One of the strategic objectives of the company is also
to efficiently utilize its cost of capital. Being a well-recognized company since more than 60 years,
the company gains from low transactions costs when it comes to raising additional funds and
borrowing. The increase in the company’s cash flows enables it to increase its frequency of share
repurchases. The company intends to promise increase in dividends in the future as well.
Why do you want to do this project?
The Coca-Cola Company's extraordinary heritage and unique culture where people convert their
passion into action are the main reason to choose this project
There's something special about The Coca-Cola Company. There's a sense of pride that comes
from building brands people love and making the most of ourselves as a company and as
individuals. In one way, you've known us all your life. Perhaps you even think of Coca-Cola as an
old friend. But old friends can grow in new and exciting ways. A massive research on Coca Cola
Company. Understanding the way they do business, what are their strategies towards marketing,
distributing, and procuring for the raw materials. I am currently facing this challenge and still I am
a half way through and I am trying to investigate more on Coca Cola Company.
How will it contribute to the industry/managers and owners?
In this project we analyze the supply chain process in the different department. And see how
different department contributes its work and struggle to achieve the goals in Coca-Cola. Coca-
Cola different department are linked to each other so by this project we identify the problems in
the department and give them recommendation how to resolve this problem.
How will it contribute to the existing literature on supply chain management?
Our supply chain plays a central role in our business, ensuring that, in all our processes, we
minimize our environmental impact and ensure sustainability in our value chain.
We produce and distribute more than 2 million unit cases of our products annually across our

territories. Our supply chain organization, which is responsible for the company's procurement,
planning, manufacturing and engineering, and sustainability, plays a central role in managing
this responsibly; making sure that in all our processes we minimize our environmental impact
and consider sustainability in our value chain - from sourcing raw materials and manufacturing
the end product to distributing it to our customers. Our success lies with our people's expertise,
our absolute focus on quality and our continuous investment in advanced technologies.
Once products are delivered to the stores, the company also has a role in ensuring that bottles make
it all the way to the shoppers’ fridges. The company’s marketing departments has exceptional
relationships with retailers to ensure that in-store merchandising makes Coca-Cola products easy
to find. “Throughout the journey of our bottles, it’s important that we communicate with our retail
partners, especially because retail can be unpredictable and even the smallest changes, such as the
weather, can affect shopper behavior. Our production systems are networked to allow us to raise
or lower capacity, allowing us to meet demand peaks (expected or unexpected) by flexing up
production at several sites if needed. And we’re fully prepared for exceptional levels of demand,
one way the company remains close to its customers is by promoting closer collaboration to ensure
its delivering what they need, when they need it and in a way that works for them.
Detail of production facilities
Water treatment
The water used in the production process is subjected to special treatments that ensure the
microbiological safety and the correct concentration of naturally dissolved salts, in compliance
with specific compositional and sensory characteristics.
The syrup
The syrup is prepared in special tanks by dissolving sugar in the treated water, then filtering the
water to remove any impurities. Only after this, this “simple syrup” is mixed with “concentrate”
or the various “basic preparations” used for the various drinks, thus becoming “final syrup”.
A flash pasteurization thermal process ensures that even the most sensitive products will not alter
their sensory characteristics during their shelf life.
Filling and packaging
The treated and cooled water is mixed with the final syrup and, for sparkling drinks, with the
carbon dioxide that gives the product its characteristic effervescence. The drink is then ready to be

packaged: every hour, tens of thousands of perfectly clean containers are filled, hermetically
sealed, labelled, coded and tested in modern automatic plants. The glass bottles are placed in boxes,
while the nonreturnable glass bottles, PET bottles and cans go into various multi-packs.
Location strategies of the company with justification
Coca-Cola main raw material is water and energy.so company choose the best location where
water and energy available easily. These two are the main priority of the company but it’s also
consider other factors. Being in the right location is a key ingredient in a business's success. If a
company selects the wrong location, it may have adequate access to customers, workers,
transportation, materials, and so on. Consequently, location often plays a significant role in a
company's profit and overall success. A location strategy is a plan for obtaining the optimal
location for a company by identifying company needs and objectives, and searching for locations
with offerings that are compatible with these needs and objectives. Generally, this means the firm
will attempt to maximize opportunity while minimizing costs and risks.
Facilities. Facilities planning involves determining what kind of space a company will need given
its short-term and long-term goals.
Feasibility. Feasibility analysis is an assessment of the different operating costs and other factors
associated with different locations.
Logistics. Logistics evaluation is the appraisal of the transportation options and costs for the
prospective manufacturing and warehousing facilities.
Labor. Labor analysis determines whether prospective locations can meet a company's labor needs
given its short-term and long-term goals.
Community and site. Community and site evaluation involves examining whether a company and
a prospective community and site will be compatible in the long-term.
Trade zones. Companies may want to consider the benefits offered by free-trade zones, which are
closed facilities monitored by customs service’s where goods can be brought without the usual
customs requirements.
Governmental regulation. Companies also may face government barriers and heavy restrictions
and regulation
Environmental regulation. Companies should consider the various environmental regulations
that might affect their operations in different locations. Environmental regulation also may have

an impact on the relationship between a company and the community around a prospective
location.
Incentives. Incentive negotiation is the process by which a company and a community negotiate
property and any benefits the company will receive, such as tax breaks. Incentives may place a
significant role in a company's selection of a site.
Layout strategies of the company with justification
The process units and buildings need to be arranged in such a way that allows for the most
economical flow of materials and people. Dangerous processes need to be a safe distance from
other buildings, and the layout should be planned to allow for future expansion. Process units are
usually laid out first in an arrangement that allows for smooth flow of materials between the
process steps. The distance between equipment is usually at least 30 m. Next, the location of the
principal ancillary buildings are sited as to minimize the time that it takes the workers to travel
between buildings. Administrative offices and laboratories are located away from hazardous
processes. Control rooms are next to the processing equipment. Utility buildings are located as to
minimize piping between the process units. Storage is placed between the loading and unloading
facilities and next to the process units that they serve. Tanks containing hazardous material are
placed at least 70 m from the plant. Here is the layout of coke cola Lahore plant

Factors affecting location decisions of company
Raw material supply: The source and price of raw materials is one of the most important factors
that determine the location of a plant.
Location with respect to market: If the plant produces high-volume and low-cost products, such
as cement and fertilizer, it may be better to situate the plant closer to the primary market since
transportation cost is a large fraction of the sales price.
Transport facilities: Facilities should be close to at least two major forms of transportation,
whether that be road, rail, waterway, and/or seaport.
Availability of labor: Skilled workers are usually brought to the plant from outside the area. There
should be a local pool of unskilled labor that can be trained to operate the plant, and of skilled craft
workers to maintain the process units
Availability of utilities: Processes that require a substantial amount of cooling water is usually
located near water sources, such as rivers or wells. Cooling water may be directly taken from the
water source, or may be stored in cooling towers. Those that need large quantities of power, such
as electrochemical ones, are typically close to cheap power sources.
Availability of suitable land: The ideal land is flat, well-drained, with suitable load-bearing
characteristics. Further considerations have to be made if the land is reclaimed land near the ocean
in earthquake zones. Property tax is also a factor when choosing a site since property taxes vary
area to area.
Environmental impact: Depending on the location, it may be more difficult and costly to dispose
of wastes. During the project design phase, experts are typically consulted to learn more about an
area's local regulations.
Climate: The climate of the area may affect processes and costs. For example, plants in cold areas
need more insulation and special heating. Facilities in earthquake areas need to be seismically
sound. Plants in areas with high ambient humidity will usually use air cooling instead of water
cooling.
Factors affecting layout decision of company
Economic considerations (construction and operating costs): Construction costs can be
minimized by arranging process units and buildings that minimize pipes between equipment
Process requirements: Examples of process considerations that must be taken into account is the
elevation of the base of columns to give enough net positive suction head to a pump.

Operation convenience: Process units that are attended to frequently should be placed with
convenient access. Valves, heads, and sample heads should be placed where operators can easily
access. If the plant anticipates replacement of equipment, space must be allowed for removal and
installation.
Maintenance convenience: Equipment that requires maintenance should be in a location with
easy access, and should have sufficient space for the maintenance tasks. For example, shell-and-
tube exchangers need space so that tube bundles can be removed for cleaning and repair.
Future expansion: The layout should be planned to conveniently allow for future expansion of
processes. Pipe racks should have space for future piping, and pipes should be oversized to allow
for more flow in the future.
Modular Construction: Modular construction is where sections of the plant is constructed outside
of the plant, and then transported to the site by road or sea. Advantages include improved quality
control, reduced construction costs, less requirements for skilled labor on site. Tradeoffs are more
flanged connections and possible problems with onsite assembly.
Safety: Escape routes for workers need to be in place at each level in process buildings. Blast walls
must isolate equipment that pose hazards to confine potential explosions.
Sourcing decisions of the company
Purchased Materials and Services Implement a program to approve and monitor the suppliers of
purchased materials that includes the following. Written specifications for purchased materials. A
process to ensure materials or services purchased from upstream suppliers meet the specifications.
A system to prevent the use of purchased materials that do not meet specifications.
The laboratory must use published, recognized and validated testing methods. Where published
test methods are not available, internally developed methods must be validated for their intended
use consistent with Good Laboratory Practices requirements. The laboratory design, equipment
and processes must ensure the test results are consistent and reliable. Materials used in the
manufacturing of packaging must meet both corporate and local business unit requirements and
performance criteria. Materials that have a potential for direct contact with The Coca-Cola
Company products must comply with regulatory requirements for food contact use in the country
where the finished product will be distributed. Materials must be approved by the Company

scientific and Regulatory Affairs .Suppliers must provide complete and accurate information for
components of materials used for contact with The Coca-Cola Company product.
Upstream and downstream activities
Upstream Activities
Upstream activities are limited to the manufacturing of the concentrate only. The actual formula
Coca-Cola uses to manufacture the syrup is a very tightly held trade secret so there is little
information regarding the exact ingredients and thus little information on the costs of their
supplies. Sugar (sucrose or high-fructose corn syrup depending on country of origin) may be the
largest known ingredient used in the manufacturing of the syrup and the company uses several
systems to track the daily variation. Some of the systems that the company uses will be discussed
later in the report. In addition to sugar, some of the other ingredients used in the manufacturing of
the syrup are Carbonated water, sucrose, high-fructose corn syrup, caffeine, phosphoric acid and
Natural flavorings. Coca-Cola has different supplier partnerships to procure these ingredients and
these partnerships are out of the scope of this project.
Downstream Activities
The downstream activities of the Coca-Cola Company focuses on the franchised distribution
system where The Coca-Cola Company only produces syrup concentrate which is then sold to
various bottlers throughout the Country who hold an exclusive territory. The Coca-Cola Company
develops products, produces related marketing and advertising programs, and sells syrup
concentrate to the bottlers. Due to the commoditized nature of its products, Coca-Cola Company
follows an intensive distributing system whereby it partners up with local bottlers. Most of these
bottlers have exclusive rights to distribution to their predefined geographic areas. The Coca-Cola
Company sets up the basic guidelines to do business in terms of operational procedures, customer
relationship management and query management and these bottlers have some degree of freedom
to develop other SOPs relating to delivery, fleet management and developing credit lines.
Detail of suppliers
Procurement involves buying Raw Materials, Inputs dealing with suppliers, vendors, billing
system SAP enabled web based platform automated the indirect procurement process.
Transformed the earlier paper based procurement process online. First the procurement data is

captured in a centralized repository that serves as a reporting source for identifying opportunities
and managing risk. Secondly key business processes are implemented, automated and standardized
to save time and improve accuracy. Finally the supplier base are rationalized and simplified to
ensure consistent and competitive pricing is obtained.
Gatronova polyesters providers and bottlers are the major suppliers of Coca-Cola. The
bargaining power of Gatronova polyesters suppliers is low. Moreover, the profitability of
the Coca-Cola’s products are directly affected with an increasing rates of sugar and packaging
material. Coca-Cola is outsourcing the services of the independent bottlers in spite of bottling
itself... As the company keeps up with the changing taste of people, it can have an enhanced
distribution network and more rapidly marketing of products.
Supplier selection criteria
Coca-Cola has authorized suppliers and which do not pose a threat to it. Anyhow Coca-Cola does
have a quality check procedures in its plants to ensure that they get the right kind of ingredients
from suppliers. Training programs, improvement audits, plant visits, supplier days, supplier
performance scores, supplier surveys, cooperation portal

Supplier selection process and strategies
In our own business, we are developing a culture where quality is a core value across the entire
organization. We have re-stated our zero tolerance for failure to meet standards and deployed a
maturity continuum measurement to enable us to move our quality and food safety-focused
culture to the next level. This approach extends to our suppliers, too. Coca-Cola requires tier
suppliers to gain certification to the following standards: ISO 9001 (quality), ISO 14001
(environment) and OHSAS 18001 (health and safety). Ingredient and packaging suppliers must
also achieve certification to FSSC 22000 for food safety and the Global Food Safety Initiative.
Supplier relationship management strategies
Our suppliers are business partners who provide our system with materials, including ingredients,
packaging and machinery, as well as goods and services. Coca-Cola’s strategies are designed
carefully so as to be harmonious with its culture, leadership and structure. Since Coca-Cola’s
organizational structure is a divisional one, this enables effective communication throughout the
entity allowing the goal of doubling its revenue to be achieved
Detail of sourcing related documents of the company
Coca-Cola also keeps much of its sourcing local, helping to keep the supply chain short and fast,
which is important for keeping up with demand. Once the ingredients and components arrive
through the factory doors, the focus is to produce high-quality drinks, in the right quantity and at
the right time, in order to meet customer demand. The company is able to get drinks from its
factories to supermarket shelves within 48 hours.
Inventory management practices of the company
Detail of warehouses/storage facilities
Coca-Cola storage facility is decentralized .In Pakistan Coca-Cola distributes its product in three
zone. One of its plant are in Karachi and where it covers the Sindh and Baluchistan province. Other
plants are in Multan and Faisalabad where its covers the northern Punjab. And the last one and
biggest plant are in Lahore where its covers the southern Punjab and northern areas of Pakistan. In
every city Coca-Cola has its own Distribution point where wholesalers has the direct contact with
the manufacturer.so coke cola process is continuous process where product are made and delivers

to wholesalers within 48 hours. Good inventory management is a careful balancing act between
stock availability and the cost of holding inventory.
Detail of storage decisions
Coca-Cola has the continuous process where where product is produced and transport at the same
time so we say that coke cola has the dedicated warehouse a dedicated warehouse is a warehouse
space that your company runs. You may own
the location, but in either scenario you are
pretty much on your own to operate the facility
and cover the costs at all times. With a
dedicated warehouse all the costs are fixed
month to month regardless of the volume of
orders and product moving through the facility.
But on the other hand a shared warehouse is
one that a third party manages in order to
service your company and likely many others.
Most importantly many of the costs become
variable and move with the volume and activity
levels of your business at a given time.
Inventory holding decisions & handling decisions
Coca-Cola will use advanced inventory management (barcode scanners). To help optimize
warehouse operations at its plant by determining warehousing processes and physical aspects of
stock management that can be streamlined for greater efficiency. AIM provides real-time
management of warehouse operations, helping extend traditional inventory management
capabilities and increase supply chain responsiveness. Users are able to control inventory
management processes in more sophisticated ways, utilizing technologies such as barcode
scanners.
Inventory ordering decisions
Push base decision are used in ordering inventory with order sizes based on specific needs of each
warehouse. Each warehouse draws inventory into the stocking location. Each stocking location is
considered independent. Maximizes local control of inventories.

Inventory/material handling equipment
The material handling activities are carried out through 15 forklift equipped with digest trolleys
and aisle equipment, indeed/out feed conveyors, 6 indeed/ out feed single-pallet vertical pallet lifts.
They are able to move pallets (Finish Good or Empty Pallet stacks) at a time, picking up or
depositing the load unit with Human intervention.
Inventory record accuracy strategies
Advanced Inventory Management will help Coca-Cola automate and streamline all aspects of
warehousing, including inventory control, replenishment, put-away and picking logic, and labor
management. User-defined rules ensure inventory stock movement and related processes are
configured to minimize time to distribute and replenish goods, so that inventory can be allocated
for prioritized shipping, and total inventory holdings can be minimized to reduce cost of
operations.
Information flow chart and Material flow chart of the company
Detecting and identifying the problems and the area for improvement build the information system
for the company with the improvements and modifications. Ending up with final information flow
system, which will be the solution for our problem. The information model deals with the
integration of supply chain members and concentrates on the flow of information among the chain
members. Information technology plays a vital role for increasing collaboration among supply
chain members. From the information point of view the effective supply chain management must
provide the right amount of relevant information to the right person at the right time. Information
is the key to successful supply-chain management because no product flows until information
flows.

Value chain analysis of the company
Leadership: The courage to shape a better future
Collaboration: Leverage collective genius
Integrity: Be real
Accountability: If it is to be, it's up to me
Passion: Committed in heart and mind
Diversity: As inclusive as our brands
Quality: What we do, we do well
Transportation network of the company
Coca-Cola Lahore mostly used trucks and container for the shipment purposes to the distributors.
Implement processes to ensure transportation conditions do not affect the packaging and to prevent
the shipment of nonconforming packaging. Inspect transportation vehicles for structural integrity,
cleanliness, security and suitability prior to loading. Control the security of the
trailer/container/tanker to prevent tampering. The supplier must demonstrate the security of the
delivery container.
Distribution network design of the company
Distribution: From the production plant, the beverages (in the form of cans or bottles) are shipped
to distribution and sales centers using the bottlers' own fleet of commercial vehicles. The
distribution centers are responsible for storing and managing the inventory and dispatching them

off to the market to different retailers. The distribution and sales centers have multiple predefined
zones and sub divisions of areas to capture all the retailers and contact points in the market.
Generally this distribution and sales centers have the following departments.
 Sales and Dispatch.
 Customer Service and Query Management.
 Logistics Dept. or Fleet Management.
 Storage or Warehousing.
 IT’S Dept.
Each distribution center is responsible for the implementing the "push strategy" in the supply
chain. Each zone in the distribution channel has a zone head who is responsible for the performance
of his zone and to increase the per capita consumption of his zone. Each zone is further divided
into different routes and each route has different territories assigned to each vehicle. In addition to
the Coca-Cola beverage, the bottlers also provide other complementary merchandise as an
incentive to key accounts like free chillers and coolers for beverages, pop materials and relaxed
credit lines. The bottlers execute several competitive strategies to maximize sales like inter-zone
competitions and give generous incentives to top performers. The sales data from each zone is
calculated on a regular basis and it helps to form sales reports which in turn help develop short
term quarterly sales
The distribution and sales centers are in close contact with the retailers through the zone managers
who give them constant feedback about the changing market trends and to help them become more
responsive to the needs of the end consumers and their purchase patters. The retailers can place
orders with their respective zone managers or they can call the distribution and sales centers if they
require addition stock. A procedural illustration of the payment process from the retailers is shown
below as it appears in the BASES software of the Coca-Cola Bottlers.
Order fulfilment process and strategies
The first area where Coca-Cola’s strategy focuses on is concerted growth. Being dominant in
the beverage industry enables the company to secure a larger percentage of the nonalcoholic
section. This strategy of Coca-Cola is in-line with both the industry and remote environment.
Within the industry environment, the company has brand equity and effective marketing strategies
that enables it to control the carbonated drinks market. In the remote environment, Coca-Cola can

grasp the opportunity of introducing healthier products in its portfolio considering the health trend
popularity.
Problems
There are some problems being faced by a company which affects its business strategies. It is
difficult to know where to begin and isolate the events which shape the business environment.
Distribution
Coca-Cola Company is facing a problem of distribution, as distributors are expecting more from
coco cola to provide an extra distribution channels which could help them to spread their products
at large .Coca-Cola products are some were not available in rural area due to inefficient distribution
system.
Investment
Coca-Cola Company is now facing a problem regarding investment, like investment in distribution
system, to make it efficient. They need investment to encourage retailers to provide space to their
products, in the form of providing coolers. Company is not in a situation to provide it to all its
retailing stores while its competitor PEPSI COLA provides it to its distributors to promote his
products in the market which is their competitive edge to increase its share in the market. It creates
an attraction to its distributors to take its products more to take incentives of special discounts
provided by the company to its distributors, wholesaler, and retailers. This is a relatively a long
term process to penetrate in the market and gain market share.
Brand Awareness
Having low promotional strategies that most of their customers are unaware of their brands mostly
they mix their brands with Pepsi, they feel that Sprite and Fanta are the brands of Pepsi but in
actual these are the brands of Coca-Cola Company they are facing these problems due to having
low promotional strategy so that the unaware of its brands.
Single Advertising Platform
They have only one Advertising platform regarding promotion which is music; on the other hand
Pepsi has another very important Advertising platform which is Cricket. Most of our youngsters
are attracted towards it.
Low value of share

Coca-Cola company having a share of about 27% which is lower than its competitors i.e. Pepsi
having market share of 68% involve in more promotional strategies as compared to Coca-Cola.
Fake Bottling
Fake bottling in Pakistan is one of the major problems being faced by the company. This problem
not only affects the sale volume and profit margins but also brand value and loyalty of the
customers. The profitability which company gain, ultimately that part of gain goes to fake bottle
producers, who running their business in the name of company
Recommendations
Distribution
Products of the company must be physically transported from its warehouse where the products
are needed. Company must add value to its products that eventually bought by individuals in order
to create a viable “value chain” model to create a relationship of distribution management and
select other facilitating organizations as a member of value chain .so the distributors within a
marketing mix is getting the product to its target Market .the most important activity in getting the
coco cola company products to the target market is arranging for its sales and transfer of a product
to its final customer by assuming its financial risks. for ultimate selling company try to carry out
the functions in exchange for the order and payment from the customer by providing more easily
available products at a required place. Company try to carry out the functions in exchange for the
order and payment form the customer by providing more easily available products at required
places. Companies try to hire Agent middle man who works as their own to distribute its products
at various locations. As the middle man could not be disinter mediate from the process although
some of unnecessary or redundant functions which cause the loss of financial resources. Company
create assortment and storing products can be shifted from one party to another in order to increase
efficiency.
Designing Distribution Channel
Specify role of distribution.
Select the distribution channel
Determine the intensity of distribution
Choose specific channel members
Market Segmentation

Market Segmentation With different wants, buying preferences or product use behavior relatively
minor and benefits sought by the customer can be satisfied with marketing mix .as a result
segments must be targeted individually and alternative marketing mix is required.
 Company should have direct communication with retailers in rural area as well as in urban
area. Company should open separate section, in their office, for direct communication with
the retailers. So that retailers get more benefit from the schemes.
 Company should provide more facilities, to the retailers, like their competitor “Pepsi”.
 The Company should lay emphasize on the advertisement of Lima, Fanta, Maaza, Thumbs
up and sprite.
 Company should give more facilities to the retailers who sell only the Coca-Cola products.
 Company should send his mechanic, on time, to repair the chilling equipment’s.
 Company should provide proper training to the salesman.
 Company should take consideration of the behavior of the company dealers.
 Company should provide more chilling equipment to the retailers of rural area.
 The recommendation of Coca-Cola Company is based on performing various valuation
models, which include HR practices. A challenge that the Coca-Cola Company is facing is
the struggle with their competitors in the fact that their HR practices are greater and less
than coke. If coke wants to more reputation in the world they must produce more incentives
for employees from which they more done work hard and produce good quality. Their new
management team needs to work on implementing cohesive goals between the two to reach
the Coca-Cola Company's long-term growth potential.
Conclusion
 The demand of Coca-Cola is increasing day by day. It removes our thirstiness & makes us
fresh & comfort. With this taste and feelings is working to provide the best quality product
with a reasonable price. It is very much important for Coca-Cola to ensure the customer
satisfaction in surviving in this market as this is very competitive market and customers
are both quality & price sensitive.
 Most retailers in rural areas, as well as in urban area are satisfied with the distributor’s
services.

 In mostly area, company does not replace the company’s damages while its competitor
“Pepsi” replaces the damage items.
 All soft drink products are highly sold in summer season.
 Different schemes offered to the different major outlets. This has created a jealousy factor
among them.
 Availability of racks is less in urban area.
 A unique and recognized brand - Coca-Cola is among the most recognized trademarks
around the globe.

References
http://www.coca-cola.com.pk/en/home/
https://www.coca-colajourney.com.pk/
https://www.linkedin.com/company/coca-cola-beverages-pakistan-
ltd?originalSubdomain=pk
https://www.cci.com.tr/en/our-company/our-geography/pakistan
https://www.scribd.com/doc/18320689/Project-on-Coca-Cola-Pakistan
https://www.slideshare.net/almas_sshahid/cocacolamarktingproject
https://www.enotes.com/homework-help/what-major-problems-faced-by-
coca-cola-pakistan-112009

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