Introduction
This case study is about the Coca-Cola Company, the world’s leading soft drink giant. The organization has an American history that dates back to historical times when the food industry was still in its infancy. Coca-Cola deals in all the supply chain processes of beverage production. This includes the manufacture, marketing and distribution of its non-alcoholic brands. The company has an international presence that has allowed it to establish investments in various global destinations. Headquartered in Atlanta, the company boasts of its ownership of John Pemberton’s patent of the original Coca-Cola product (Greenfield, 2016). Coca-Cola Company’s supply chain system is a complex one. The mother organization and its subsidiaries formulate syrup concentrate that is availed to the bottling corporations across the world. Such companies operate according to the agreements provided by the Coca-Cola franchise. Arguably, the size of the Coca-Cola Company demands efficient inventory management systems that conform to modern corporate standards.
Background
For a large company like Coca-Cola, inventory management has always been a matter of concern. The company faced issues with the management of its inventory due to the scale of its operations. Additionally, the volume of goods handled by the organization and the bottling companies contributed to the occurrence of inventory management problems. Considering the main company, the integration of distribution rights to befit various territorial expectations was cumbersome. Additionally, some bottling companies were smaller than others were. Such disparities affected the efficiency of business analysis that would beget uniformities. The Coca-Cola Hellenic Bottling Company, for example, operated in twenty-eight countries (Eccles, 2015). The storage systems of its Romania plant had inventory management issues that surrounded the aspects of environmental sustainability, storage efficiency and cost-effectiveness. Furthermore, the flexibility of warehousing operations was also a matter of concern. This prompted the bottler to establish a warehousing strategy that would correct the problem.
Factors affecting warehousing efficiency
Large companies are prone to experiencing some challenges regarding the aspects of warehousing (Cuzzocrea, 2016). First, inventory location is an important determinant of storage efficiency. Inappropriate inventory oversight is a confounding factor towards the occurrence of inefficiencies that would affect organizational health. This is attributable to the increase in inventory management costs and the existence of sloth in warehousing operations. Without strict oversight, functions such as loading and scheduling become retarded significantly. Inventory accuracy is a fundamental determinant for the success of inventory management systems. Manufacturers must ensure the reliability of their inventory management data if they hope to promote consumer satisfaction. This is because inventory accuracy has an angle in influencing the efficacy of product distribution systems. Additionally, space utilization affects the management of a company’s inventory. Large organizations must have appropriate warehouse layout plans to advance the interests of inventory management efficiency. Furthermore, processes have a critical role in influencing the nature of inventory management in a company. The application of redundant procedure such as manual inventory management may curtail the productivity of a large organization like Coca-Cola Company.
Coca-Cola Company’s Warehousing strategy
The significant expansion of Coca-Cola operations forced the organization to revolutionize its warehousing strategy (Evans, 1998). For most of the bottling companies across the world, modern technology is used to manage their diverse inventory base. High bay warehousing has been incorporated into the inventory management plans of most bottlers across the globe. Coca-Cola Hellenic bottling operations have been streamlined by the construction of high bay storage warehouses. These facilities operate in alignment with supply chain management principles and the integration of technological systems that promote organizational efficiency (Iarca, 2011). For the Romania-based bottling plant, the company’s move to advance its inventory management operations has widened its scope and provided it with opportunities for future growth.
Coca-Cola Amatil is another licensed company that operates in Australia and New Zealand. It produces non-alcoholic beverages and mineral water and is considered among the most prolific bottlers of Coca-Cola Company. The scope of this bottler is large as it covers about six countries in the Asia-Pacific region. The size of its inventory has forced the company to automate its storage systems to meet modern storage standards. Furthermore, Coca-Cola Swaziland followed suit by implementing an advanced inventory management plan that would revolutionize its operations considerably. The decision to automate its warehousing operations promoted various aspects of its inventory management systems. First, inventory control was advanced to ensure that company officials had a hands-on approach to the maintenance of warehousing schedules. Additionally, the replenishment of company inventory has been streamlined through this automation. Advanced inventory management has been instrumental in promoting the objectivity of the bottler regarding Coca-Cola operations.
Conclusion
The warehousing strategy employed by the Coca-Cola Company is highly efficient. High bay warehouses are huge storage facilities that have become popular in modern manufacturing. They are buildings that tower more than twelve meters off the ground as a measure of optimizing the spatial aspects of storage.
A critical factor in high bay warehousing is the transportation of goods between storage areas within a facility. Machines involved in transportation are fitted with automated mechanisms that ensure the efficiency of warehouse operations. The applications of computer technology and robotics have been integrated in high bay warehousing to create highly efficient inventory management systems.
References
Cuzzocrea, A. (2016, March). Warehousing and Protecting Big Data: State-Of-The-Art-Analysis, Methodologies, Future Challenges. In Proceedings of the International Conference on Internet of things and Cloud Computing (p. 14). ACM.
Eccles, R. G., & Serafeim, G. (2015). Corporate and integrated reporting: A functional perspective. Chapter in Stewardship of the Future, edited by Ed Lawler, Sue Mohrman, and James O’Toole, Greenleaf.
Evans, R., & Danks, M. (1998). 2 Strategic supply chain management.Strategic supply chain alignment: Best practice in supply chain management, 18.
Greenfield, S. (2016). Giving the Global High Sign: Coca-Cola Advertising of the “American Way” in Life Magazine, 1941-1947.
Iarca, I., Ruşeţ, V., Sima, V., & Gheorghe, I. G. (2011). Sustainable Development-Essential Business Strategy Vector of Coca-Cola HBC Romania. Petroleum-Gas University of Ploiesti Bulletin, Technical Series,63(4).
