The first step in the Coca-Cola drinks’ supply chain management consists of suppliers.
The plastic supplier is responsible for delivering the pure plastic itself in order to make plastic bottles subsequently. The process of making plastic typically involves the extraction and refinery of crude oil. It has been estimated that up to 4% of the world’s annual oil production was used to produce and manufacture products made out of plastic (Wong, 2010). Plastics products of various shapes and characteristics are produced by different kinds of moulding machines.
Thereafter, syrup suppliers, is responsible for acquiring ingredients needed to create the liquid. In fact, the Coca-Cola Company is only responsible for creating the syrup itself. Next steps in the supply chain process are done by franchise holders, who have right to spread the products in specific geographical areas (Minkler, 1992). It is a significant advantage, as the firm does not need to take care of delivering the product to the consumers in detail.
After gaining all the essentials the task is to blend all the raw materials, such as flavorings, chemicals, and sweeteners. The recipe is a secret formula called Merchandise 7X and is kept in sun trust banks vault in Atlanta. The soft drink is believed to contain, caffeine, sugar, potassium and caramel, which the procurement department has to manage across various different suppliers.
The next step is bottling. In some countries it is done by a specific partner, while in others it is done as a part of the whole production process. The bottlers are obligated to buy all of the concentrates and syrups for particular Coca-Cola trademark drinks from the authorized suppliers. Afterwards, the manufacturer produces the final drink by combining the syrup with sweeteners and filtered water, then carbonation is taking place in order to make the drink sparkling before putting it in cans and bottles.
As mentioned above, the Coca-Cola company has got many franchise holders, whose duty is to deliver the finished drink to retail stores. Since those who hold franchise have legal right to use Coca-Cola trademark, they need to stick to strict rules while delivering the products to the next layer of the supply chain. Distributors are expected to fulfill its contracted obligations on quality, price, reach, promotion of the brand and other essentials needed for better market reach (Yadav et al., 2013). The distributor, who mainly operates with intensive distribution, after the coordination and management of placing the bottles into boxes and trucks sell and distribute the packaged products to retail stores, restaurants, wending machines and food service distributors.
Retailers play an important role in the product chain, as they are between the producers and consumers liaise them. In this layer, the retailing members are supposed to select products in such a way to make it easy to the customer to spot it. Retailers have potential to impact random consumers to pick and purchase a particular product. Therefore, the retailers’ duty is to display the soft drink in the most convenient ways for clients. Coca-Cola often provides the retailers with refrigerators at a 50 percent discount or offers a few dozen crates of free product for accomplishing a desired sales target.
Environmental issues & green practices
The most known and serious environmental issue that Coca-Cola has ever created was the impact of bottling factory in province of Uttar Pradesh in India (Karnani, 2014). The company used limited resources of groundwater above legal limits, which later resulted in groundwater levels in the area dropping to lower levels, as well as the local water being polluted with toxic chemicals. The situation later led people, mostly employed in agriculture, to suffer from scarce water resources, which made them not able to work on a daily basis. However, years of protests have finally forced Indian authorities to close down the factory (Burnett and Welford, 2007).
Nevertheless, since the price of the water is constantly increasing and water is an essential part of our lives, the company decided to pay for its past mistakes and in 2015 in announced water replenishing goal (Grey, 2018). The idea is about giving back the amount of water not different to the amount the company used to produce finished beverages. To achieve the goals, Coca-Cola is trying to help provide access to safe water in areas when the resources are limited, and also protect watersheds, which includes conserving and restoring water quantity and quality. The fact that Coca-Cola included water supply issues in its SWOT analysis, indicates the seriousness of the situation and forced the firm to create special green teams to have them coordinate the water conservation.
Another problem that the company faced during the few last years was polluting the oceans with plastic bottles. It has been mostly noticed by Greenpeace, environmental organization, which was campaigning against Coca-Cola to stop them from choking the oceans’ water with plastic litter. It has been calculated that the company fabricate more than 110 billion throwaway plastic bottles annually — which turns out to be 3,400 a second (Taylor & Laville, 2017).
Due to the fact the plastic waste in the oceans is a very common issue nowadays, Coca-Cola decided to introduce a new goal to overcome the outstanding problem, called “World Without Waste”. The main aim of the programme is to start using recycled materials in production of the bottles and collect the discarded waste. Coordinated cleaning is targeted for about 80 beaches and across all marine reserves (Staff, 2018).
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