Supply Management: Coke to implement asset-light supply chain strategy

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Handing over its assets to a few long term bottling partners and re-franchising its distribution needs, should help Coca Cola to boost operating margins, save costs and impress shareholders.

But will this new asset-light strategy work? Gopal Iyer, sourcing and supply chain consultant at 4C Associates, says: “Time and again, companies have questioned and redefined their core competencies. ‘Deverticalisation’ has been evident in the semi-conductor industry, where costly investment requirements and economies of scale have encouraged outsourcing of manufacturing and Coke has a series of bottlers across the globe that run on a franchisee model.”

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