In another purported Wal-Mart heavy-handed tactic, it appears to have asked the Coca-Cola company to alter its century-old beverage distribution model and deliver its products direct to Wal-Mart's warehouses. This would allow Wal-Mart increased scale and efficiency since it could replenish Coke products within its own supply chain instead of having Coke bottling partners visit stores daily to re-stock Wal-Mart stores nationwide.The suspected threat? That Wal-Mart would launch a competing sports drink product to sit alongside Coke's Powerade product in all Wal-Mart stores -- and that would dent Coke's profit a tad. While this is a rumor at this point, it seems plausible -- Wal-Mart has so many private-label products (Sam's Choice products, for example) already. Many of those third-party manufacturers would jump at the chance to make a sports drink product for Wal-Mart stores.











Reader Comments (Page 1 of 1)
6-09-2006 @ 1:15PM
steve said...
the title of the piece is coke having trouble with walmart requests, I see nothing in the piece that would tell me that coke would not agree to the requests!???
6-10-2006 @ 11:18AM
Rich said...
Coke should be delighted, Ok lets review Brians Article:
In another purported Wal-Mart heavy-handed tactic, it appears to have asked the Coca-Cola company to alter its century-old beverage distribution model and deliver its products direct to Wal-Mart's warehouses...... Do you think freight costs come into the picture? The operative statement Brian has made is CENTURY-OLD DISTRIBUTION MODEL, Coke should be thanking Walmart in 1906 a gallon of gas was, wait OK in 1906 the cost of hay to feed a horse for a week was. There is an old saying that “The Lead Dog Always has a Bloody Butt” Like I said Coke should be thanking Walmart.
6-10-2006 @ 2:47PM
Michael Ricci said...
If Wal-Mart is squeezing one of the largest corporations like this, their reputation for squeezing and at times destroying smaller suppliers musts be true. As one who attempted to do business with them a few years ago it would appear that their reputation is well earned.
6-11-2006 @ 12:47AM
Leopold Scotch said...
This is just another chapter in Wal-mart's plan to rule the world. By destroying competition (don't say they aren't Coke could either comply with wal-mart's demand or risk going into competition with them.) If you don't think wal-mart is evil see what they did to vlasic or rubbermaid or any number of other business virtually destroyed for going into business with wal-mart.
6-11-2006 @ 7:54PM
Alex said...
Coke should stick to it's guns.
Coca Cola will be around long after Wal-Mart has imploded. Wal-Mart does not practise good ethical long term business principles in my opinion and I believe they are going to pay for it more and more as time goes on.
6-11-2006 @ 10:19PM
E B CARD said...
The future for Coke is not in peril if they elect to compromise their business model. Although, there will be some intial costs adjustments for them and their bottlers for a couple of years. However, labor at times can work against you with the daily grind of servicing stores of this magnitude. Interestly, Coke would shift their service calls more to the smaller retailer thereby improving their visage for the other key players in the market. Albeit, WalMart must not allow out of stocks and voids to miniimize their profitability with a move of this collosal decision. So then, should Coke make the decision in favor of WalMart. Not Quite. The numbers must be carefully analyzed stragically for the short term and long term before both parties make a decision. Remember, Coke will always be it because the world-customers not WalMart says so. Any rate, take me to the self-service register to check-out.
6-12-2006 @ 5:48PM
Glenn L said...
The last thing a company that does its own merchandising of its products needs is Walmart staff doing it. The company [Walmart]can't keep staff, and it shows with their sloppy store presentation.
6-13-2006 @ 11:06AM
Michelle said...
I see an advantage for Coke that they may not even realize (even though I agree Wal-Mart is a bully). I have several times gone to my local store looking for Caffeine-Free soda, the bottling rep only stocks 8 on the shelves each day. No matter how much I ask the store for more, I can only purchase what is left of the 8. The bottling reps do not leave extra "in the back." At least wal-mart has a proven technique for inventory control and will realize more quickly what is truly selling AND will have more Coke "in the back" to sell when the 8 are gone from the shelf. I think it is sad that wal-mart will be able to pressure a company into their model for business, however in this particular case, it probably needs to be done. Hostess, Campbells, and all the other companies that stock their own shelves will have to fall in line too.... all those retail reps will not be out of a job though, they just will do less crawling on the floor and more sales for new retail accounts.
6-13-2006 @ 5:14PM
David said...
Those who work for suppliers that deal with Walmart are getting sick of their "we want it our way, everyway, everyday" attitude.
I would never shop at Walmart. Coke needs to remember that they are more established than this retailer.
In the end, it will be Coke that calls the shots.
9-05-2006 @ 12:34PM
hank scorpio said...
Wal-Mart should alter its business model and pay its employees a livable wage, offer decent benefits and provide measuable security for its customers within its property...INCLUDING parking lots.
Even better, Wally World should shrivel and die.