Coca Cola 2006 Annual Report Download - page 36

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Customer and Commercial Leadership
The Coca-Cola system has millions of customers around the world who sell or serve our products directly to
consumers. We focus on enhancing value for our customers and providing solutions to grow their beverage
businesses. Our approach includes understanding each customer’s business and needs, whether that customer is
a sophisticated retailer in a developed market or a kiosk owner in an emerging market. We focus on ensuring
that our customers have the right product and package offerings and the right promotional tools to deliver
enhanced value to themselves and the Company. We are constantly looking to build new beverage consumption
occasions in our customers’ outlets through unique and innovative consumer experiences, product availability
and delivery systems, and beverage merchandising and displays.
Franchise Leadership
We are renewing our franchise leadership to give our Company and our bottling partners the ability to grow
together through shared values, aligned incentives and a sense of urgency and flexibility that supports
consumers’ always changing needs and tastes. The financial health and success of our bottling partners are
critical components of the Company’s success. We work with our bottling partners to continuously look for ways
to improve system economics, and we share best practices throughout the bottling system. We also design
business models for still beverages in specific markets to ensure that we appropriately share the value created by
these beverages with our bottling partners. We will continue to build a supply chain network that leverages the
size and scale of the Coca-Cola system to gain a competitive advantage.
Challenges and Risks
Being a global company provides unique opportunities for our Company. Challenges and risks accompany
those opportunities.
Our management has identified certain challenges and risks that demand the attention of the nonalcoholic
beverages segment of the commercial beverages industry and our Company. Of these, four key challenges and
risks are discussed below.
Obesity and Inactive Lifestyles. Increasing awareness among consumers, public health professionals and
government agencies of the potential health problems associated with obesity and inactive lifestyles represents a
significant challenge to our industry. We recognize that obesity is a complex public health problem. Our
commitment to consumers begins with our broad product line, which includes a wide selection of diet and light
beverages, juice and juice drinks, sports drinks and water products. Our commitment also includes adhering to
responsible policies in schools and in the marketplace; supporting programs to encourage physical activity and
promote nutrition education; and continuously meeting changing consumer needs through beverage innovation,
choice and variety. We are committed to playing an appropriate role in helping address this issue in cooperation
with governments, educators and consumers through science-based solutions and programs.
Water Quality and Quantity. Water quality and quantity is an issue that increasingly requires our
Company’s attention and collaboration with the nonalcoholic beverages segment of the commercial beverages
industry, governments, nongovernmental organizations and communities where we operate. Water is the main
ingredient in substantially all of our products. It is also a limited natural resource facing unprecedented
challenges from overexploitation, increasing pollution and poor management. Our Company is in an excellent
position to share the water-related knowledge we have developed in the communities we serve—water-resource
management, water treatment, wastewater treatment systems, and models for working with communities and
partners in addressing water and sanitation needs. We are actively engaged in assessing the specific water-related
risks that we and many of our bottling partners face and have implemented a formal water risk management
program. We are working with our global partners to develop water sustainability projects. We are actively
encouraging improved water efficiency and conservation efforts throughout our system. As demand for water
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