How Coca-Cola is using tech to drive supply chain efficiency

Coca-Cola is one of the biggest brands in the world, and its supply chain operations are one of the most complex yet with much efficiency. There is no doubt that its technology implementation has helped a great deal.

With over 500 product portfolios and 3,500 beverages under the company’s belt, its supply chain needs all the help it can get.

A fun fact about its supply chain strategy is that its supply chain outsources all the levels of the operation except the secret ingredients. Well, they guide this one with their business lives.

The recent pandemic and economic downturn taught many businesses the value of implementing information technology in their supply chains.

However, businesses like Coca-Cola have made strides in information technology over the years.

So, while these businesses suffered the pandemic’s impact, coca-cola was thriving. The company had always been tech-centric. It also relies heavily on it to get the best out of its supply chain network and drive efficiency.

But what are the tech implementations driving supply chain excellence at Coca-Cola?


1. Tech in its procurement efforts

With issues like climate change, wars, pandemics, and other supply chain disruptors, procurement has become increasingly more complex.

It is not far-fetched to imagine that large corporations like Coca-Cola, which has over fifty procurement categories, would invest heavily to ensure efficiency.

One such way is Artificial intelligence. AI has become an indispensable tool for the Coca-Cola procurement team.

Amid the constant chaos, Coca-Cola uses Artificial Intelligence to consolidate different data within the supply chain process. They use this data to create scenarios, model the potential impact of these scenarios, and forecast demand.

To advance its procurement efficiency, Coca-Cola partnered with Keelvar, a tech company that uses AI to provide solutions to procurement sourcing issues.

The partnership between the two companies initially began with their logistics procurement but has since widened its scope within Coca-Cola procurement.

The partnership has been beneficial in improving efficiency, but more importantly, through the help of matrices such as pricing and logistics, It has been able to cut the total cost of ownership significantly.


2. Tracking sustainability

Preaching supplier transparency on Sustainability is easy. However, if we are honest, getting accurate data on supply chain details takes much effort, especially regarding the ESG issues.

With ESG taking off, corporations have put a lot of effort into meeting up to the standards. While the E(environment) and G(governance) have been reasonably achievable, the S(social) has not been relatively difficult to come about.

The chief reason is that it is more subtle. Whether it is slave labour or racial discrimination, social issues are difficult to track.

Coca-Cola is partnering with blockchain start-ups like Diginex to use blockchain technology to promote supply chain due diligence around labour.

Diginex uses blockchain to gather information on suppliers regarding ESG shortcomings continuously; they then use this to generate reports for their partners.

3. Simplifying distribution

Globally, Coca-Cola sells about 1.9 billion bottles per day. Despite this, there is a push by the management to encourage all the Coca-Cola bottling plants to ship out 160,000 litres a day.

Unprecedented feet. However, it is a distribution nightmare. The company had to enable cross-party transactions between their bottling companies to stay on top of their distribution.

The cross-party transaction is a system by CONA (Coca-Cola One North America) to supplement inventory shortages between its bottling partners.

Though the system is effective, the reconciliation process can be daunting and sometimes take up to 50 days. CONA had initially used a version of hyper ledger fabric, but with the growing need to add external suppliers for efficiency, they opted for blockchain technology.

With blockchain protocol technology, CONA has reduced the reconciliation process from nearly two months to just a few days.

They are rules governing data sharing between all parties on the blockchain.


4. Warehouse automation:

It’s not news that automation of warehouses or distribution centres increases the efficiency of the supply chain and improves lead time.

However, every industry requires a different set of strategies in their automation.

To maximize their efficiency, Coca-Cola partnered with system logistics Vertique, one of the market’s most highly rated automation systems.

The system uses robotics and barcodes to track the entire supply chain process, from production to retail delivery.