Mary Joy M. Dela Cruz
Ms. Beo
BSBA-Management
Logistics
Coca Cola Logistics Process
Introduction Introduction It is an undisputable fact that over the years logistics has made a substantial contribution to businesses. Today, Today, a number of companies such as Coca Cola Company has attained competitive advantage through an improved management of its supply chain (Cooper et al. 1992). Coca Colas strategy is emphasi!ed on e"cellence in logistics# sourcing material management and physical distribution relative to the production location. Coca cola relies on imported componenti!ed parts from a $ide range of suppliers in different countries to produce its products and assemble it in another country. The thrust behind the logistics and supply chain activities has been the transportation industries culminating globalisation. globalisation. %ccording to Cushmann & 'aefield 'aefield (2*) the ongoing globalisation glob alisation of production inculcating business practices such as outsourcing and restructuring as $ell as as the integration of regional economies in the logistics maret has been pragmatic p ragmatic $ithin the +uropean regions and other parts of the $orld. This has also necessitated necessitated the creation of modern logistics and distribution facilities such as distribution centres, $arehouses and transfer depots to promote efficiency in the managing the supply chain activities as a $hole (ushton et al., 2).
The managers of Coca Cola have decided to strategically focus on China for its primary production. This because China is endo$ed $ith ra$ materials such as bau"ite ore and sugar cane and factories that processes the ra$ materials into aluminium cans and sugar. -oreover it has e"tensive supplies net$or in countries lie India, Thailand, etc (ch$ab and /orter, 20) $ho also produces some amount of sugar and aluminium. esides China have the $orforce, energy and infrastructures including road$ays, rail$ays, $ater$ays, ports and terminals (CI%, 21). In support to its energy resources, China in 29 commissioned an enormous ine"haustible hydroelectric dam built bu ilt on the angt!e angt!e river near ichang $hich is capable of generating 139 of Chinas total po$er output (C4++, 29)
Distribution flow of Coca Cola The manufactured coca cola in ei5ing, Tian5in and hanghai $ill be transported to the +uropean distribution centre based in -unich, 4ermany. In the ei5ing bottling factory, the palleti!ed canned coe $ill be paced into 6ft containers and moved to the main ei5ing78amburg rail$ay terminal by train. The containers $ill be loaded onto freight train to be transported from ei5ing to 8amburg. The train routes passes through -ongolia, ussia, elarus and /oland to the 8amburg rail terminal (C report, 20). The rail shipment $ill tae 1 to 10 days (:loyds, 20). -ean$hile the palleti!ed canned coe produced in Tian5in and hanghai $ill also be paced into 6ft containers and moved to the Tian5in and hanghai / orts respectively by train. The containers are then loaded onto containerships bound for deep7sea shipping from the various ports $hich $ill mae a stop at 8amburg /ort. The sea route lining the China ports and +urope passes through the outhern parts of China, -alaysia, through the ue! Canal to -alta, elgium to the 8amburg /ort (;inhuanet, 26). %ccording to :loyds (20) the 2,m sea vo yage taes < to <0days. ranch (199*) vie$ed shipping as the transportation of goods from place of lo$ utility to place of high utility. The goods may be in the form of either ra$ materials3intermediate3finished product transported in bul cargo shipment to a refinery or range of durable consumer products shipped in containers. In 8amburg the containers that $ere transported by rail from China $ill be unloaded and transferred onto another train for on carriage. This is termed as . %lso the remaining containers that $ere shipped by sea $hen unloaded in 8amburg $ill also be transferred onto train for on carriage. This is no$n as . The trains then transport the containers from 8amburg to the +uropean =istribution Centre in -unich, 4ermany. The rail route from 8amburg passes through either erlin7>ranfurt3=usseldorf7tuttgart route to -unich (-artin, 2<). Coca Cola uses 4ermany as its distribution centre in +urope because it has the logistics $hereby several east7$est trade routes run through 4ermany (Cushmann & 'aefield, 2*). %lso the centre ensures effective inventory management system, advanced monitoring and customer information system, reliability and fle"ibility in distributing the coca cola to the clients across the region (+uropean Intermodal %ssociation, n.d).
Filling a Gap between Supply and Demand
The 4enesys program is an integrated %/ +nterprise esource /lanning (+/) solution that $ill replace CC+?s legacy systems in the processes of @order to cash,A @reBuisition to payment,A and @record to report.A 4enesys $ill allo$ CC+ to shorten cycle time in these p rocesses and be more productive. It $ill also help bring more visibility into the business and improve decision maing. @'e are a shelf7replenishment company, a supply chain company, a sales and customer services company,A says +sat e!er, senior vice president and chief information officer of CC+. @It is very important for us to integrate our manufacturing plants all the $ay up to the replenishment of shelves in the retail outlets. Through the information side of the eBuation, $e are basically tying those t$o ends of the business process together the manufacturing side, $hich drives the supply of our product, and the shelf7replenishment side, $hich drives the demand part of our produc t.A CC is playing a ma5or role in e"pediting the delivery of 4enesys across CC+?s operations, allo$ing CC+ to deploy 4enesys at multiple7country locations at a much faster pace than if CC+ had forged ahead alone. @There are a lot of technology areas that reBuire some capacity that $e might not have or some technology areas that $e might not have the no$ledge about,A says e!er. @o $henever $e have those no$ledge gaps, $e turn to our strategic partner CC to fill in. 'henever an accelerated deployment need arises, $e leverage CC, and $e can generate value much more Buicly.A
The Coca7Cola efreshments team includes students Erinn Manby, Drew Downey, Mereit! "reeman, #e$in Jamison, Sa!il %ama&ris!nan, 'atalie Sout!er , and Ma( )ans&i. Their faculty advisor is )on Die&er. The purpose of their pro5ect is to reduce Coca7Cola efreshments? total inventory costs at three in7scope plants by developing ne$ inventory replenishment policies. y creating three ne$ policies and customi!ing policy parameters for each ra$ material, they have identified a <*D reduction in total annual inventory costs.
References:
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