Coca Cola 2015 Annual Report Download - page 14

Public debate and concern about perceived negative health consequences of certain ingredients, such as non-nutritive sweeteners and biotechnology-
derived substances, and of other substances present in our beverage products or packaging materials, may reduce demand for our beverage products.
Public debate and concern about perceived negative health consequences of certain ingredients in our beverage products, such as non-nutritive sweeteners
and biotechnology-derived substances; substances that are present in our beverage products naturally or that occur as a result of the manufacturing process,
such as 4-methylimidazole, or 4-MEI (a chemical compound that is formed during the manufacturing of certain types of caramel coloring used in cola-type
beverages); or substances used in packaging materials, such as bisphenol A, or BPA (an odorless, tasteless food-grade chemical commonly used in the food
and beverage industries as a component in the coating of the interior of cans), may affect consumers' preferences and cause them to shift away from some of
our beverage products. In addition, increasing public concern about actual or perceived health consequences of the presence of such ingredients or
substances in our beverage products or in packaging materials, whether or not justified, could result in additional governmental regulations concerning the
marketing and labeling of our beverages, negative publicity, or actual or threatened legal actions against us or other companies in our industry, all of which
could damage the reputation of, and may reduce demand for, our beverage products.
If we are not successful in our innovation activities, our results may be negatively affected.
Achieving our business growth objectives depends in part on our ability to successfully develop, introduce and market new beverage products. The success
of our innovation activities in turn depends on our ability to correctly anticipate customer and consumer acceptance and trends, obtain, maintain and enforce
necessary intellectual property protections and avoid infringing on the intellectual property rights of others. If we are not successful in our innovation
activities, we may not be able to achieve our growth objectives, which may have a negative impact on our financial results.
Increased demand for food products and decreased agricultural productivity may negatively affect our business.
We and our bottling partners use a number of key ingredients that are derived from agricultural commodities such as sugarcane, corn, sugar beets, citrus,
coffee and tea in the manufacture and packaging of our beverage products. Increased demand for food products and decreased agricultural productivity in
certain regions of the world as a result of changing weather patterns may limit the availability or increase the cost of such agricultural commodities and could
impact the food security of communities around the world. If we are unable to implement programs focused on economic opportunity and environmental
sustainability to address these agricultural challenges and fail to make a strategic impact on food security through joint efforts with bottlers, farmers,
communities, suppliers and key partners, as well as through our increased and continued investment in sustainable agriculture, the affordability of our
products and ultimately our business and results of operations could be negatively impacted.
Changes in the retail landscape or the loss of key retail or foodservice customers could adversely affect our financial performance.
Our industry is being affected by the trend toward consolidation in the retail channel, particularly in Europe and the United States. Larger retailers may seek
lower prices from us and our bottling partners, may demand increased marketing or promotional expenditures, and may be more likely to use their
distribution networks to introduce and develop private label brands, any of which could negatively affect the Coca-Cola system's profitability. In addition, in
developed markets, discounters and value stores, as well as the volume of transactions through e-commerce, are growing at a rapid pace. The nonalcoholic
beverage retail landscape is also very dynamic and constantly evolving in emerging and developing markets, where modern trade is growing at a faster pace
than traditional trade outlets. If we are unable to successfully adapt to the rapidly changing environment and retail landscape, our share of sales, volume
growth and overall financial results could be negatively affected. In addition, our success depends in part on our ability to maintain good relationships with
key retail and foodservice customers. The loss of one or more of our key retail or foodservice customers could have an adverse effect on our financial
performance.
If we are unable to expand our operations in emerging and developing markets, our growth rate could be negatively affected.
Our success depends in part on our ability to grow our business in emerging and developing markets, which in turn depends on economic and political
conditions in those markets and on our ability to acquire bottling operations in those markets or to form strategic business alliances with local bottlers and to
make necessary infrastructure enhancements to production facilities, distribution networks, sales equipment and technology. Moreover, the supply of our
products in emerging and developing markets must match consumers’ demand for those products. Due to product price, limited purchasing power and
cultural differences, there can be no assurance that our products will be accepted in any particular emerging or developing market.
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