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Coca-Cola has a number of products, but their core product is the eponymous flagship beverage. But what is Coca-Cola? In essence, it is a syrup that is mixed with carbonated water in order to produce a soft drink. The production method is to gather the base ingredients, and then to create the syrup, which is a mixture of these flavoring ingredients, sugars and some water. This syrup is then blended with the carbonated water in order to produce the final product. When you get a Coke at a soda fountain, the blending occurs at the fountain. When you get a Coke in a bottle or can, it is blended at the manufacturing facility right before it is packaged, so that the packaging maintains the carbonation.
The process looks like this:
source: Process Flow Sheets (no date)
Supply Chain
The Coca-Cola supply chain is complicated mainly by the volumes that the company requires, and the fact that it needs near-constant production to minimize costs. The ingredients are a collection of flavors and syrups, which are processed agricultural products. So Coca-Cola needs to ensure a high volume of supply, delivered at frequent intervals throughout the year, of products that are derived from crops. That is a significant challenge for the company. One of the reasons why the company switched from sugar to high-fructose corn syrup, for example, was to ensure a domestic supply of its main sweetener -- sugar crops...
are less reliable than corn crops, and can cost more.
Coca-Cola makes a specific point to control its supply chain through contracts so as to ensure a reliable supply of the different ingredients.
With respect to solid goods, such as bottles, Coca-Cola also uses fixed contracts with a variety of suppliers as well. The suppliers are responsible for ensuring that they are able to meet the requirements of Coca-Cola, who are most likely the supplier's largest customer. Coca-Cola has a high level of bargaining power that allows it to dictate the terms of most of the contracts throughout its supply chain.
Marketing and Sales
Coca-Cola is a marketing-dependent organization. Their marketing spend is around $3.3 billion annually worldwide, making it one of the world's largest marketing companies (Zmuda, 2014). The company seeks to saturate promotional channels with the brand, and ensure that the product achieves saturation distribution. Messages equate Coca-Cola with quenching thirst, and seek to differentiate it from other carbonated non-alcoholic beverages. The company often uses…
References
Process Flow Sheets (no date). Soft drinks production process flow chart. Process Flow Sheets. Retrieved September 15, 2016 from http://processflowsheets.blogspot.ca/2011/08/soft-drinks-production-process-flow.html
Zmuda, N. (2014). Coca-Cola maintains marketing spend amid sluggish demand. Advertising Age Retrieved September 15, 2016 from http://adage.com/article/cmo-strategy/coca-cola-maintains-marketing-spend-amid-sluggish-demand/294251/
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