Coca-Cola restructures in effort to focus on franchising
Coca Cola Company have announced plans to restructure its North American business in an attempt to accelerate its franchising efforts and streamline its main focus.
The integrated business in North America will be segmented into a traditional company and a bottler-operating model. The company will consist of two operating units: Coca-Cola North America and Coca-Cola Refreshments.
Coca-Cola CEO Muhtar Kent commented: “Now, we are in a position to leverage this flexibility to return to a traditional company and bottling operating model in North America, which will enhance our focus on execution and accelerate the refranchising of our bottling system in our flagship market.”
The decision to return to franchising model in the US was announced back in April 2013. In 2010, Coca-Cola paid $12.3 billion to biggest US bottler, securing control of production and distribution. Coca-Cola took the decision to franchise so it can reduce costs associated with maintaining delivery trucks and warehouses but keeping control of our bottling process.