BusinessDay... the voice of business: Coca-Cola invests in development of entrepreneurs

Coca-Cola invests in development of entrepreneurs
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Anonymous on 07 May, 2008 02:00:00
 
Coca-Cola Africa, working with its bottlers has committed to boost economic
growth across the continent.
It is investing in the expansion and upgrading of its distribution network of
manual distribution centres (MDCs), which are significantly maximising job and
wealth creation in Africa’s MDC-surrounding communities.
The company aims to enhance this distribution network and replicate this model
in key African countries over the next three years to create between 1,300-2,000
additional independent distribution businesses, 5,300-8,400 new jobs and
generate new revenue of between $320 million and $520 million – yielding
greater momentum toward the achievement of the Millennium Development Goals.
The commitment was made by The Coca-Cola Company CEO, Neville Isdell at a
Business Call to Action event held in London Tuesday.
It was hosted by Douglas Alexander, Secretary of State for International
Development and Kemal Dervis from the United Nations Development Programme
(UNDP).
At the event, Coca-Cola Africa was recognised as an important contributor in
the critical drive to achieve the Millennium Development Goals.
Its MDC business model, which has been operational over the past five years, is
a distribution system based on independent local entrepreneurs, the foundation
of the company’s distribution system.
It has created new small businesses, new jobs and increased skill levels, and,
while rolled out across four East African countries, Tanzania was specifically
chosen for a pilot project that will investigate ways to further enhance the
socio-economic impact of this simple, yet innovative distribution system.  This
process will be completed in collaboration with local bottler, Coca-Cola Kwanza.
“The Coca-Cola Company aims to support the development of sustainable
communities, because without sustainable communities we do not have sustainable
business,” says Nathan Kalumbu, Coca-Cola Africa Business Unit President for
East and Central Africa. “The Manual Distribution Centre (MDC) model, which is
currently being executed in a number of African countries including Tanzania,
has created new small businesses, new jobs and increased skills levels and
provides a powerful platform from which we offer entrepreneurial opportunities
that open the door to job and wealth creation.”
The model focuses on providing career opportunities for unemployed individuals,
and to date, has empowered many women, with a significant percentage of MDCs
being women-owned.
It is estimated that one job at Coca-Cola Africa produces up to 16 local jobs
along its value chain. To date, MDCs in Tanzania have provided opportunity for
more than 420 Tanzanians to invest in their own businesses. These businesses in
turn have created employment for over 1,600 people many of whom were previously
unemployed.
Lilian Nale, MDC owner in Kinondoni, Dar es Salaam employs 5 people at her
operation. She says, “Being (an) MDC owner has empowered me (in) business
skills and management as a whole. It has helped me to pay school fees for my
lovely daughter, Angel and I am starting to build my own house now.”
The pilot project which takes place during the course of 2008 is being
conducted in partnership with key bottling partner Coca-Cola Sabco, the Harvard
CSR Initiative and the International Finance Corporation.
MDCs are best described as managed third party distribution centres. Instead of
trying to service thousands of small retail outlets with small drop sizes, the
bottler distributes to carefully selected MDCs who sell Coca-Cola products
exclusively.
The MDC owners are actively supported and managed by the bottler, who helps
each owner establish their operations, including designing routes and methods of
delivery and determining the frequency of delivery service required to maintain
stock levels. The key to the success of this approach is that MDCs are driven by
entrepreneurs in touch with their markets while they receive ongoing support
from the bottler and Coca-Cola, to ensure that optimal selling conditions are
maintained at the retailer level.
In announcing Coca-Cola’s initiative Chairman and CEO Neville Isdell said:
“I firmly believe that business can have a very positive role in achieving
the Millennium Development Goals. As part of the Call to Action, we at The
Coca-Cola system will continue to use the core of our operational expertise and
a winning formula of our business success in Africa – a distribution system
based on independent local entrepreneurs – to create more jobs, more
prosperity, more entrepreneurship and skills and ultimately more sustainable
communities.”
Notes for editors
1. The Business Call to Action event is taking place in London on 6 May, hosted
by HMG and UNDP.  The event will bring together over 75 CEOs. President John
Kufuor of Ghana and President Paul Kagame of Rwanda will also attend the event.
2. The Business Call to Action is not a one off event, it is part of a major
campaign to accelerate progress towards meeting the MDGs by 2015. During 2008,
the Call to Action aims to build momentum and galvanise actions from businesses,
governments, NGO’s, faith groups and civil society.
http://www.dfid.gov.uk/mdg/call-to-action.asp
3. A video and audio news release are also available for media use on or after
May 6 – this showcases seven of the initiatives from Citi Group, Coca Cola,
Diageo, Microsoft, Reuters, Sumitomo and Vodafone and includes footage of their
global CEOs talking about the transformational impact that the projects will
have.
4. Coca-Cola Kwanza referred to in paragraph 4 is part of the Coca-Cola Sabco
Group.
About The Coca-Cola System
The Coca-Cola system is comprised of The Coca-Cola Company and our bottling
partners — more than 300 worldwide. The Coca-Cola Company manufactures and
sells concentrates, beverage bases and syrups to bottling operations, which then
produce a wide array of Coca-Cola beverages. Our Company owns the brands and is
responsible for consumer brand marketing initiatives. The bottling partners, in
addition to manufacturing the final branded beverages, also handle merchandising
and distribution.
Bottlers work closely with customers — grocery stores, restaurants, street
vendors, convenience stores, movie theaters and amusement parks, among many
others — to execute localized strategies developed in partnership with the
Company. Customers then sell our products to consumers at a rate of
approximately 1.5 billion servings a day.
The Coca-Cola system is not a single entity from a legal or managerial
perspective, and the Company does not own or control most of our bottlers. In
2006, bottling partners in which our Company had no ownership interest or a
noncontrolling equity interest produced and distributed approximately 83 percent
of our worldwide unit case volume. In January 2006, our Company owned bottling
operations were brought together to form the Bottling Investments operating
group, now the second-largest bottler in the Coca-Cola system in terms of unit
case volume.  For more information on the Coca-Cola System, please visit our
website at www.thecoca-colacompany.com.
About The Coca-Cola Company
The Coca-Cola Company is the world’s largest beverage company. Along with
Coca-Cola(R), recognized as the world’s most valuable brand, the Company
markets four of the world’s top five nonalcoholic sparkling brands, including
Coca-Cola Light(R), Fanta(R) and Sprite(R), and a wide range of other beverages,
including diet and light beverages, waters, juices and juice drinks, teas,
coffees, energy and sports drinks. Through the world’s largest beverage
distribution system, consumers in nearly 200 countries enjoy the Company’s
beverages at a rate exceeding 1.5 billion servings each day. For more
information about The Coca-Cola Company, please visit our website at
www.thecoca-colacompany.com.