Outbound Logistics

4.1 Primary Activities

4.1.1 Inbound Logistics

Inbound logistics deals with the handling of raw materials and inventory received from various suppliers. The operational procedures and tasks surrounding inbound logistics include warehousing, storage and control of raw materials used for concentrate and syrup manufacturing. Inbound logistics are a primary activity as they represent the beginning of Coca-Cola's value adding conversion of inputs. Few initiatives are taken to streamline inventory control, storage and material handling. Some of the initiatives implemented are optimised such as the location of distribution facilities to minimise shipping times, material and inventory control systems, ICT systems to reduce time to send "returns" to suppliers and warehouse design to increase efficiency of operations for incoming materials (Paul 2010). These will significantly improve Coca-Cola's cost position in this activity. Failure to reduce storage and inventory cost can result in significant competitive disadvantage.

4.1.2 Operations

What many people do not know is that globally, The Coca-Cola Company and its bottling partners are not one and the same. The Coca-Cola Company only produces a syrup concentrate which it sells to over 300 bottlers worldwide who hold Coca-Cola franchises for one or more geographical areas. The Coca-Cola Company has minority shares in some of its largest franchisees like Coca-Cola Enterprises, Coca-Cola Amatil, Coca-Cola FEMSA and Coca-Cola Hellenic Bottling Company. It owns or licenses the brands, and to connect its brands to the consumers, the company focus on various marketing activities (The Coca-Cola System 2011). The bottlers in turn produce, package, distribute and merchandise the final product to customers like convenience stores, restaurants, street vendors, grocery stores, movie theatres, schools, amusement parks and etc. These customers then sell the