Coke is it -- it being the #1 nonalcoholic beverage company, as well as one of the world's most recognizable brands. The Coca-Cola Company is home to 16 billion dollar brands, including four of the top five soft drinks: Coca-Cola, Diet Coke, Fanta, and Sprite. Other top brands include Minute Maid, Powerade, and vitaminwater. All told, the company owns or licenses and markets more than 500 beverage brands, mainly sparkling drinks but also waters, juice drinks, energy and sports drinks, and ready-to-drink teas and coffees. With the world's largest beverage distribution system, The Coca-Cola Company reaches thirsty consumers in more than 200 countries.
The world's largest beverage company rings up nearly 58% of its sales outside the US, in some 200 countries worldwide across Eurasia, Africa, Europe, North America, and the Pacific Region. Important international markets include Asia and Latin America.
It owns and market four of the world's top five nonalcoholic sparkling beverage brands: Coca-Cola, Diet Coke, Fanta and Sprite.
In line with its Vision 2020 strategy, which seeks growth opportunities and operational efficiencies, The Coca-Cola Company adopted a new global operating structure in 2013. The company's business is divided into three operating segments: Coca-Cola International, Coca-Cola Americas, and Bottling Investments Group (BIG). The Coca-Cola International business consists of the company's Europe, Pacific, and Eurasia & Africa groups, while Coca-Cola Americas includes the company's North America and Latin America groups. BIG focuses on the beverage company's owned bottling operations outside of North America.
The Coca-Cola Company's bottling investments help to maximize the efficiency of its production, distribution, and marketing efforts. They include a 29% stake in Mexico's bottler Coca-Cola FEMSA (now the largest independent Coke bottler), 23% of European bottler Coca-Cola Hellenic Bottling, and 29% of Coca-Cola Amatil, a bottler and distributor of Coke products in Australia, New Zealand, and surrounding countries.
Sales and Marketing
Not only is Coca-Cola one of the world's most recognizable and valuable brands, but The Coca-Cola Company supports the largest beverage distribution system in the world, made up of company-owned or controlled bottling and distribution operations, as well as independently owned bottling partners, distributors, wholesalers, and retailers. Beverages bearing trademarks owned by or licensed to them account for 1.9 billion of the approximately 57 billion beverage servings of all types consumed worldwide every day.
To keep its brand foremost in the mind of consumers, the company incurred advertising expenses in excess of $3.26 billion in 2013, about the same as in 2012.
After experiencing straight five years of revenue growth, in 2013 The Coca-Cola Company's revenues declined by 2% due to the unfavorable impact of its geographic mix (with growth in lower revenue per unit emerging and developing markets exceeding growth in developed markets). The unfavorable impact of foreign currency fluctuations also decreased consolidated net operating revenues by 2%.
After experiencing net income growth in 2012 due to higher revenues and a decline in other operating charges, in 2013 The Coca-Cola Company's net income dropped by 5% due to a decrease in revenues and operating income.
In 2013 the company’s operating cash inflow decreased by 1% due to a decline in the net income and a change in working capital.
The popularity of soft drinks, especially in mature markets, has been on the decline since about 2005 as negative publicity about obesity and other health risks continues to threaten sales. As a result, The Coca-Cola Company and other top soft drink makers are turning toward other parts of their noncarbonated product portfolio for growth, such as fruit juices, sports and energy drinks, and bottled water and tea beverages.
The Coca-Cola Company is also looking to relatively undeveloped markets with a growing middle class and money to spend on soft drinks and juices. To that end, it announced it will invest $5 billion with its bottling partners in Africa by 2020, raising its investment in the region to $17 billion from 2010 to 2020. Coke plans to build new manufacturing capacity, develop sustainability initiatives and create jobs.
In a move that supports expanding its fruit-based drinks portfolio and investing in Africa, in late 2014 The Coca-Cola Company announced a partnership with alcoholic beverage company SABMiller and South Africa's Gutsche Family Investments to create Coca-Cola Beverages Africa, the continent's largest bottler. The new company will serve about a dozen high-growth markets, where disposable incomes and the population are growing, and handle about 40% of the beverage company's African volume. In exchange for its $260 million investment, The Coca-Cola Company will receive an 11% interest in the bottler and SABMiller's global Appletiser brand of carbonated juices as well as about 20 other African and Latin American non-alcoholic beverage brands. Gutsche Family Investments already controls Coca-Cola Sabco, a Coke bottler since 1940 with operations in seven African countries. Coca-Cola Beverages Africa will absorb most of SABMiller's non-alcoholic operations on the continent as well as Coca-Cola Sabco's plants.
That year the company teamed up with Keurig Green Mountain, entering into a 10-year global strategic agreement to collaborate on the development and introduction of The Coca-Cola Company global brand portfolio for use in Keurig Green Mountain's Keurig Kold at-home beverage system.
In 2013 Coca-Cola opened a new bottling plant in Myanmar as part of a planned $200 million investment during the next five years there which also includes adding more than 22,000 jobs during that time period.
Mergers and Acquisitions
Diversifying its portfolio, in 2014 the company acquired a 16.7% equity stake in Monster Beverage Corp., a leading maker of energy drinks. Under the terms of the deal, The Coca-Cola Company will transfer ownership of its worldwide energy business, including NOS, Full Throttle, Burn, Mother, Play and Power Play, and Relentless, to Monster; and Monster will transfer its non-energy business, including Hansen's Natural Sodas, Peace Tea, Hubert's Lemonade and Hansen's Juice Products, to The Coca-Cola Company.
In 2013 it bought ZICO Beverages, a maker of ZICO Pure Premium Coconut Water.
Growing its distribution network, in 2013 The Coca-Cola Company bought Sacramento Coca-Cola Bottling Company, the sixth-largest independent Coca-Cola bottler in the nation that serves nine northern California counties.