Coca-Cola Completes Refranchising Of U.S. Company-Owned Bottling Operations

Posted On: 11/3/2017

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ATLANTA -- Coca-Cola Co. is marking a major milestone as nearly 70 independent bottlers across the United States are now running their trucks and bottling operations as a fully refranchised system.

Nearly a decade ago, Coke began its plan to reshape its bottling system in North America to return the ownership to the hands of local bottling partners. 

Three major territory closings in late October led to the historic milestone. Liberty Coca-Cola Beverages, a new bottler, began operations in New York, New Jersey and the metro Philadelphia area. This is the former Tri-State Metro Operating Unit of Coca-Cola Refreshments.

Reyes Coca-Cola Bottling took on new bottling territories in California and Nevada, which were previously operated by CCR. Reyes added to its existing operations in parts of six Midwestern states, including Chicago, Detroit, Minneapolis and Milwaukee.

Swire Coca-Cola USA closed on an additional production facility in Colorado, adding to its existing bottling operations across six Western states.

With the closing of these U.S. transactions, Coca-Cola North America has completed the company's largest refranchising initiative. The company and its U.S. bottling partners have worked together to execute 60 transitions, which include 350 distribution centers, 50-plus production facilities, more than 55,000 employees and more than 1.3 billion physical cases of volume.

"We are reshaping our business and accelerating our transformation to become a total beverage company," said J. Alexander "Sandy" Douglas, Jr., president of Coca-Cola North America. "Our system is built to respond to consumers' needs in a fast-moving and highly competitive environment. Returning the local part of our business to where it really belongs and will best perform -- in the hands of local companies -- is a key enabler of the exciting transformation and growth of our business."

Coca-Cola's U.S. system is now made up of a diverse array of independent bottlers, from multinational owners to decades-old, family-held operations. The beverage giant said the new system is working to reinvent portfolio diversification, packaging innovation, production, procurement, technology and pricing. 

Most of the new or expanding bottlers are hiring more people and investing in plants and equipment, according to Coke officilas. The new system also operates on a new IT platform that enhances efforts to digitize the Coca-Cola system and improves the ability to coordinate and manage information across bottling partners at both local and national levels.

Coca-Cola North America's refranchising plan will conclude with the completion of transactions in Canada and the U.S. Virgin Islands, which are anticipated in the first half of 2018.