The History Of Suppliers Relationship Management Business Essay

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Coca Cola's suppliers are those business partners who provide raw materials, machinery, goods and services to the company. It expects the suppliers to comply with all the relevant laws and regulations including health and safety measures, environmental practices as well as human and workplace rights. Therefore, the company has a set of guidelines called Supplier Guiding Principles (SGP) that acts as a communication tool to emphasize the company's concern about the prohibition of child labour, working hours and wages, environment protection and abolition of discrimination.

Coca Cola is aware that there are different regulations around the world so it expects that the suppliers to follow the laws and the company's SGP. In return, the suppliers will deliver excellent goods and services that enable the company to provide high quality products to the consumers.


Coca Cola practices franchise production model where it only manufactures syrup concentrate and distribute to the bottling partners for further processing to the end products before selling to retailers, restaurants and food service providers. The bottlers around the world are allowed to adjust the sweetness to meet local taste. When the consumers are satisfied, they will be more loyal to the company.

Nonetheless, there is a problem with the franchise model. Bottlers' aim to maximize their profit through usage of low-volume syrup in high margin products whilst Coca Cola gains profit from the volume of syrup sold to the bottlers. Therefore, there might be conflict exists between Coca-Cola and its bottlers.


Coca Cola's main concern about packaging is sustainability and environmental-friendliness. The weight of the 330ml cans has been downsized from approximately 80 grams to 23 grams. Besides, weight of PET disposable bottles has also been reduced by altering the neck of the bottle and its neck. As a result, the usage of PET and carbon dioxide (CO2) emission can be saved significantly.,oid,13705/lang,2/ticket,g_u_e_s_t/local_lang,2

It is recommended that the PET disposable bottles to be made up of 50 percent recyclable materials instead of the existing 23 percent as to reduce the CO2 emission. Furthermore, the company has announced to enter partnership agreement with three leading biotechnology companies to produce second generation of PlantBottleâ„¢ packaging that are 100 percent made from plant based materials.

Warehousing and material handling

The company has the fully automated warehouse that situated next to its bottling plant. Thus, it eliminates the costly double handling of shipping products off-site to local warehouses that will result in cost savings. Furthermore, the warehouse has 25,224 pallet locations and it is designed to facilitate further expansion for better throughput and better material handling, as well as improved operational efficiencies.

Besides, the high-tech machinery in bottling plant in UK helps to produce cans and bottles more efficiently. The plant is able to produce about 4,000 330ml cans in a minute.


Coca Cola adopts hybrid technology for its transportation. It helps to reduce gas emissions and fuel consumptions. Hence, this technology not only helps the company to save fuel costs and maintenance costs but also increases drivers' satisfaction as the hybrid trucks use around 30 percent less fuel than normal delivery trucks. As a result, the company has been awarded "Green Fleet of the Year" and "Private Fleet of the Year" due to the combined effect of financial gain and positive environmental footprint.

However, it is worried that there will be few alternative energy available to sustain the increasing demand of transportation while at the same time meeting fuel efficiency and reducing carbon footprint.

Distribution network

Coca Cola has developed strong distribution channels around the world. The company has introduced Micro Distribution Center Model (MDC) in Africa to create employment and boost the local economy. As a result, the products can reach specific area where truck delivery is not practicable which helps to strengthen the company's reach in this market; at the same time providing wealth and job opportunities to local communities.

Customers Relationship Management

The company's customers comprise of international retailers and restaurant chains and independent local businesses. They aim for cost reduction, better sales and profit margins as well as providing higher quality products to end-users. Thus, the company will provide tailored support to the customers as facilitating their grow will also help the company to grow. With the intention to improve customers' business efficiency and profitability, Coca Cola provides training and work with them to offer wider range of beverages. As a result, the customers are motivated and they are more loyal to the company. Coca Cola also operates Retailing Research Councils that carry out research on problems in the food retail industry. councils will provide results and directions through a collaborative website so that the retailers are able to respond to the dynamic environment.