Coca-Cola's MDCs: Distribution Effectiveness vs Social Responsibility?

Abstract

By June 2010, The Coca-Cola Company's (Coca-Cola) micro distribution centre (MDC) network in Africa had proven to be incredibly successful. Coca-Cola had built up the network to distribute its products through small, independent local entrepreneurs to even smaller outlets, enabling the company to reach markets that traditionally had been very difficult to access. Now social marketers were approaching Coca-Cola for permission to distribute their own products using the MDC network. Paul Fourie, group strategy and business planning director of Coca-Cola Eurasia and Africa, soon had to present his recommendations to Coca-Cola and its bottlers – and wondered what he should suggest as the way forward.

Resources
Exhibit 1 Examples of Coca-Cola Brands

Figure

Source: www.cokecce.com

Figure

Exhibit 2 Eurasia and Africa Financials

Source: The Coca-Cola Company Annual Report, 2009.

Figure

Exhibit 3 Coca-Cola Distribution Chain

Source: Harvard Kennedy School, ‘Developing Inclusive Business Models: A Review of Coca-Cola’s Manual Distribution Centers in Ethiopia and Tanzania: Executive Summary’, 2009.

Figure

Exhibit 4a Examples of Various Transportation Methods

Tuc Tuc in Dar es Salaam, Tanzania

Source: Courtesy of Adrian Ristow, 28 July 2010.

Figure

Exhibit 4b Examples of Various Transportation Methods (Continued)

Handcart in Dar es Salaam, Tanzania

Source: Courtesy of Adrian Ristow, 28 July 2010.

Figure

Exhibit 4c Examples of Various Transportation Methods (Continued)

Wheelbarrow cart in Lusaka, Zambia

Source: www.flickr.com, photos by Tielman Nieuwoudt (accessed 23 June 2010).

Figure

Exhibit 5 MDC Business Operations Model

Source: Business Call to Action Innovations in Action, ‘The Coca-Cola Company: Enabling Jobs and Opportunity', available www.businesscalltoaction.org/wp-content/files_mf/1286826974CocaColaCaseStudyFORWeb.pdf (accessed 21 February 2010).

Table

Exhibit 6a MDC Owners
Exhibit 6b

MDC in Angola

Source: Courtesy of Adrian Ristow, 28 July 2010.

Figure

Adrian Ristow (middle) and Mubarek, a MDC owner and his team in Addis Ababa, 2008.

Source: Colalife, available www.colalife.org/2008/07/06/meet-adrian-ristow (accessed 28 July 2010).

Figure

Exhibit 8 Excerpts from Fact Sheet on Health in the African Region of WHO

Figure

Fact sheet N°314, November 2006

In the African Region, 72% of all deaths are from communicable diseases, such as HIV/AIDS, tuberculosis, malaria, respiratory infections and the complications of pregnancy and childbirth; compared to 27% in all other WHO Regions combined.

INFECTIOUS DISEASES
HIV/AIDS
  • The African Region has 11% of the world's population, but an estimated 60% of people with HIV/AIDS.
  • HIV/AIDS is the leading cause of death for adults in the Region.
  • The number of HIV-positive people on antiretroviral treatment increased eight-fold between December 2003 and December 2005: from 100 000 to 810 000.
Malaria
  • Malaria is endemic in 42 of the 46 countries of the African Region.
  • More than 90% of the estimated 300–500 million clinical cases of malaria that occur across the world every year are in Africans, primarily children under the age of five years.
  • There are nearly a million deaths due to malaria each year, the vast majority among children under five.
  • Artemisinin-based combination therapies – the most effective anti-malarial treatments available today – have been adopted by 33 countries as first-line treatment, but only 9 were implementing such treatment policies in 2006.
Tuberculosis
  • An estimated 2.4 million new tuberculosis cases – 24% of all notified cases worldwide – and half a million tuberculosis deaths are reported in the Region each year.
  • Tuberculosis has been on the rise in tandem with HIV/AIDS, because people with HIV, whose immune systems are weakened, easily contract tuberculosis and go on to develop active tuberculosis.
  • Tuberculosis was declared a public health emergency in the African Region in 2005.
PREVENTABLE CHILDHOOD ILLNESSES

Polio has nearly been eradicated.

Measles deaths have declined by more than 50% since 1999. In 2005, 75 million children received measles vaccines, and 37 countries were vaccinating 60% or more of their children against the disease.

MATERNAL AND CHILD HEALTH
  • Of the 20 countries with the highest maternal mortality rates, 19 are in Africa. In 2002, in the African Region, an estimated 231 000 women died due to pregnancy and childbirth complications.
  • The African Region's neonatal death rate is the highest in the world. An estimated 43 out of every 1000 babies born in 2005 died during their first 28 days of life.
  • Deaths among African children have been on the rise. In 1960, 14% of deaths among children under five years of age worldwide occurred in the Region. That proportion had risen to 23% in 1980 and 43% by 2003.

Source: World Health Organisation (WHO) Media centre, Fact Sheet no. 314, November 2006, available www.who.int/mediacentre/factsheets/fs314/en/index.html (accessed 29 July 2010).

locked icon

Sign in to access this content

Get a 30 day FREE TRIAL

  • Watch videos from a variety of sources bringing classroom topics to life
  • Read modern, diverse business cases
  • Explore hundreds of books and reference titles