According to Coke spokesperson Kamlesh Sharma, the new division will lean on the existing supply chain infrastructure and capabilities in manufacturing plants, depots and other backend infrastructure to source its supplies and service the markets.
“Work has progressed within the new vertical on appropriate sales routines, processes and practices. It will be operationalized in phases across different geographies in India over 2012-2014 and will cover all markets,” he told FoodNavigator-Asia.
The new vertical is being launched within Hindustan Coca-Cola Beverages Pvt Ltd (HCCBPL); the company’s bottling operation in India.HCCBPL manufactures and distributes beverage brands such as Coca-Cola, Diet Coke, Thums Up, Sprite, Fanta, Limca, Maaza, Minute Maid and Kinley.
Sharma said that while the company has an existing sales and distribution system in India for all beverages that reaches over 1.5m retail outlets, there is still room for expansion given that there are 8m such outlets in India.
“For this, the company has launched the Minute Maid and Alternative Beverages Division, which will make a foray and build new and nascent channels,” he said, besides strengthening the existing grocery and convenience channels.
First of its kind, will also target mass-market and niche drinks segment
Sharma pointed that this innovation in sales and distribution is the first of its kind for Coca-Cola worldwide, wherein an entire alternate system is being set-up within a country for a selective set of beverage offerings.
“This is also in a way recognition of the growing importance of [the non-fizzy drinks market] in India. The long-term objective of the new vertical is to be robust, self-sustaining and an important growth engine for Coca-Cola,” he said.
According to Sharma, the new division will enable the company to supply goods from its multiple manufacturing and depot locations to the markets through separate distributors.
“The model will be relatively lower on merchandising intensity than what is required for the traditional sparkling beverages distribution model, but will facilitate more number of retail outlets to be serviced,” he said.
Other than Minute Maid, the new division would deal in mass-market beverages to recruit and engage consumers with lesser disposable income. “For example the Fanta Fun Taste, which sells for 5 rupees (US$0.09).”
“It will also deal in niche beverages like the popular Schweppes range of mixers, Burn Energy Drinks and other premium beverages that will be introduced by Coca-Cola India from time to time.”
“However, as the name suggests, Minute Maid will be an important growth engine for this new business vertical. Globally, Minute Maid is a billion dollar brand for the Coca-Cola Company,” he claimed.