The Supply Chain of Coca Cola USA: A Comprehensive Analysis

This report provides a detailed analysis of the Coca Cola USA supply chain, examining both upstream and downstream processes. The upstream component focuses on raw material sourcing, particularly water and sweeteners, highlighting key suppliers like Western Container Corporation, NutraSweet, Ajinomoto, Tate & Lyle, and Nutrinova Nutrition Specialties & Food Ingredients GmbH. The downstream component explores the distribution network, emphasizing the role of bottlers such as Coca-Cola Bottling Co. UNITED and Swire Coca Cola, as well as retail outlets and vending machines. The report also identifies core competencies crucial to the supply chain's performance, including maintaining quality and taste, engaging in CSR activities, and fostering strong relationships with suppliers and bottlers. Furthermore, the analysis underscores the importance of local adaptation and the significant employment and environmental goals within Coca Cola's supply chain strategy, emphasizing innovation and community engagement.

Running head: THE SUPPLY CHAIN OF COCA COLA USA
The supply chain of Coca Cola USA
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1THE SUPPLY CHAIN OF COCA COLA USA
Coca Cola one of the leading manufacturers, suppliers and distributors of non-
alcoholic beverages and syrups is a global trade operating even in the remotest place. The far-
reaching capability of such a business especially in the vast terrains of USA is only possible
due to a strong and competent supply chain network (Wisner, Tan and Leong 2014).
The main supply chain components have been shown in a diagram:
Upstream Downstream
Source: Created by the author
Raw
material
suppliers
Western
Container
Corporation
The
NutraSweet
Company and
Ajinomoto
Co.
Tate & Lyle
Nutrinova
Nutrition
Specialties &
Food
Ingredients
GmbH
Coca Cola
Distribution
centres in USA Consumers
Wholesalers
Retailers/
Supermarket
Restaurants/
Cafe
Petrol
Stations
Vending
Machine
Tier 1 Tier 2 Tier 1 Tier 2 Tier 3

2THE SUPPLY CHAIN OF COCA COLA USA
Upstream Tier 1:
Water being the primary raw material used, the company has always focused on
judicious and sustainable usage of water in USA .Though there were no major shortage of
water resources till date, there were few instances where limited water supply led to certain
difficulties. Apart from water, the most important raw materials required are nutritive and
non-nutritive sweeteners.
Upstream Tier 2:
These four companies are the key suppliers of Coca Cola in USA. The major
requirement of plastic bottles is provided by manufactures, which are jointly owned by the
company as well as Coca Cola bottlers. The company is a major stakeholder of Western
Container Corporation, which is a key producer of plastic bottles. In USA, the primary
nutritive sweetener used is High Fructose Corn Syrup (HCFS), which is obtained in
abundance from domestic sources. The company purchases HCFS with the assistance of
Coca-Cola Bottlers' Sales and Services Company LLC whose owner is Coca Cola Bottlers
(Stadtler 2015).
The company purchases non-nutritive sweetener aspartame that is required in sparkling
beverages from The NutraSweet Company and Ajinomoto Co. Raw material saccharin or
acesulfame potassium is bought from Nutrinova Nutrition Specialties and Food
Ingredients GmbH. Sucralose, a non-nutritive sweetener is bought from a single and reliable
source Tate & Lyle.
Downstream Tier 1:
The Company has tied up with around 70 bottlers who take the charge of distributing
above 700 products across the country (Company et al. 2018). These bottlers companies even

3THE SUPPLY CHAIN OF COCA COLA USA
manufacture apart from carrying out the final packaging in some cases. Coca-Cola Bottling
Co. UNITED and Swire Coca Cola are the major bottlers in USA.
Downstream Tier 2:
Nearly all the major retail outlets/supermarkets, corner shops sell a wide range of
Coca Cola products. Vending machine, petrol pumps are also a point of sale for Coca Cola
products.
Downstream Tier 3:
Owing to the global brand value, the company has a wide range of demographic,
ethnic as well as all age group consumers.
Competences and activities that are core to the supply chain's performance
Coca Cola focuses on maintaining its Quality and Taste. It is also highly engaged in
CSR activities reducing waste materials significantly with the incorporation of measures that
would deviate from having harmful effects on the environment. Thus, it has an efficient
supply chain with a high production rate. Coca Cola is a global brand flavoured by local
taste. In USA Coca Cola is not a singular entity , rather it’s a collaboration of 70 bottlers who
have been given the responsibility of manufacturing products based on local demand.
These local bottlers besides giving the customers their best experience also add to the
employment role. The bottlers even take the marketing initiative to reach the neighbour first
instead of travelling miles to distribute. The Coca-Cola Bottling Co. UNITED, one of the
pioneer bottlers has invested in the local customers and communities thus upholding the local
operating model (Company et al. 2018).

4THE SUPPLY CHAIN OF COCA COLA USA
The following figure shows the information flow of Coca Cola’s Supply chain
process:
Figure 1: Information flow of Coca Cola
Source: (Stadtler 2015)
Innovation: Coca Cola has always strived to achieve the likes, preferences and tastes of the
local people and customise it accordingly.
Employment: Employs more than 90000 people with a consolidated payroll of $3.5 billion
(Company et al. 2018).
Environment Goals: Strives to achieve lesser carbon emission.
Relationship with suppliers: Has a strong and reliable relation with all its raw material
suppliers.
Relationship with bottlers/Distribution: The bottlers form the pillar of the Coca Cola
system, and they are given much freedom in carrying the global brand to the doorstep of
every local customer.

5THE SUPPLY CHAIN OF COCA COLA USA

6THE SUPPLY CHAIN OF COCA COLA USA
References:
Company, O., Main, O., Diversity, S., System, T., Reports, C., (U.S.), C., Coca-Cola, W.,
Information, S. and Center, P. (2018). Coca-Cola Journey Homepage. [online] The Coca-
Cola Company. Available at: http://www.coca-colacompany.com/ [Accessed 9 Apr. 2018].
Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management
and advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Wisner, J.D., Tan, K.C. and Leong, G.K., 2014. Principles of supply chain management: A
balanced approach. Cengage Learning.