Coca Cola’s new business strategy

Kathmandu, December 18:

Carbonated soft drinks major Coca Cola is trying out new business strategies in order to revive the depleting beverages market in Nepal.

The most recent being starting manual distribution counters (MDC) in its bid to reach out to the interiors of the city where accessibility of big Coca Cola trucks is impossible.

This initiative, successfully tried out in Coke’s African and Sri Lankan markets, was first introduced at a trial stage last year with three pilot operatives in Samakhusi, Bhimsen Gola and Shantinagar. Today, Bottlers Nepal Ltd, the sole franchise of Coca Cola in Nepal, claims to be running 32 MDCs in various parts of the valley.

“The company now plans to take this initiative beyond the valley in the Tarai region by testing the grounds in Biratnagar soon,” said BNL’s country manager Jose A Roque on Monday. This first of its kind innovation, claimed Roque, is aimed at supporting small scale entrepreneurs who may not have enough capital but are interested in becoming partners of the Coca-Cola business.

“We provide them with the equipment as push carts, and training to handle business and earn profits on the basis of commissions,” pointed out Roques.

Although aimed at being merely a distribution strategy, the move to assist individuals to start their own small businesses where they employ a handful of people may be unwittingly turning into a CSR activity for the company.

“The CSR impact,” confesses Roques, “is purely coincidental.” Evidently, these small scale independent entrepreneurs have slowly come to form the backbone of Coca-Cola’s business in many parts of the city.

The MDC initiative appears to have given the beverage company a much needed breather in the light of declining sales.

Depite political turmoil and falling margins, BNL claims to have managed a two per cent higher sale than November last year. However, it remains to be seen whether the MDC initiative actually helps the company in realising its rather optimistic target of a double digit growth in 2007.