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Supply Chain Structural Change Within the Beverages Industry- Initial Signposts Emerge

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The following commentary can also be viewed and commented upon on the Supply Chain Expert Community web site. In March of 2010, Supply Chain Matters provided commentary on how the aftereffects of major economic downturns can often lead to new and different business models.  We specifically cited an evolving trend for disintermediation and structural change within certain industry supply chains, motivated by certain business performance needs.  The ongoing developments currently occurring in the beverages industry provide learning for certain other industries. Within the beverages industry, the separate acquisition announcements by both Coca Cola and PepsiCo for buyout of each of their major North American distribution groups made significant news for that industry.  Both previously held major equity interests in their named franchise bottling groups, but major shifts in consumer buying preferences toward flavored waters, juices and other drinks caused both industry giants to embark on a strategy of acquiring the […]

Supply Change Structural Change Begins to Emerge Within the Beverages Industry

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Note: The following posting can also be viewed and commented upon on the Kinaxis Supply Chain Expert Community web site.   In January, Supply Chain Matters commented on evidence of large industry influencers embarking on the first steps toward what could ultimately become disintermediation within certain industry supply chains. At the time, we cited examples of Wal-Mart and Google embarking on significant programs to gain more control and influence over aspects within their respective supply and value-chains.   Another noteworthy evidence point of this trend is now occurring within the soft drink and beverages industry. For about thirty years, this industry has been operating on a business model developed around high margin carbonated beverages. The major brand owners, in this case Coke and Pepsi, control the marketing and sales of high concentration syrup  These brand owners in-turn distribute to franchise or independent bottlers who control the production, sales and distribution […]