COCA-COLA HELLENIC BOTTLING COMPANY

Coca-Cola Hellenic Bottling Company

Coca-Cola Hellenic Bottling Company

Q. 1 How do CCHBC's operations management practices enable CCHBC to achieve its stated strategic aims?

In order to expand its operations in the water and juice segments, Hellenic has made a series of small-to-medium-sized acquisitions, of which the most important was Multon in 2005 (one of the top three juice manufacturers and distributors in Russia). Most of these acquisitions were made in conjunction with TCCC, which usually acquires the brands from which it receives royalty income, while Hellenic retains the assets and controls the acquired business. In 2008, Hellenic expanded its geographic footprint to five Southern Italian regions by acquiring and integrating Socib - formerly the second-largest Coca-Cola franchise bottler in the country. This acquisition increased Hellenic's sales volumes in Italy by 22% in 2009 and, according to management, delivered earlier-than-expected synergies (Hong, 2010, 395).

Figure 1

The rapid deterioration in the global economic environment and rising unemployment rates negatively impacted orders from wholesalers and distributors in light of reduced demand from end customers across all of Hellenic territories (Hong, 2010, 395).

Q. 2 Critically access CCHBC's approach to capacity management

Working with local management, the Total Logistics team considered several manual and automated options before finally recommending an automated high-bay storage solution. Total Logistics provided an initial design, taking palletised products from existing production lines via a main conveyor and into a storage area with the capacity for 35,000 pallets. The high-bay clad-rack warehouse will be served by 11 automated cranes to create an efficient retrieval system (Hong, 2010, 395).

Peter Roan, Director at Total Logistics, said, “Coca-Cola Hellenic identified its plans to expand capacity in the future and needed to know if its existing site could facilitate its projected development and have the capacity for additional storage. Our specialist team examined the existing processes at the Ploiesti plant and looked at various options for providing increased storage and the associated benefits. We identified the optimal solution and subsequently ran an invitation to tender which led to the appointment of FKI Logistex as the solution provider.” The new automated high-bay system, which opened in October 2009, is thought to be the first in Romania and enables the facility to handle 24,000 returnable glass bottles (RGB) per hour, 120,000 plastic bottles (PET) per hour, and 71,000 cans per hour across the six production lines. The system can handle up to 290 pallets per hour on intake and 490 pallets per hour for dispatch (Tucker, 2010, P 336).

As a whole, the logistic structure consists of 15 platforms to load trucks that make small deliveries and 15 loading bays for trucks that feed the large customer park of wholesalers and the large-scale retail trade. In order to integrate the existing distribution capacity, a new shipping area for aseptic product loading was constructed, served directly from the new automatic warehouse. The new warehouse is composed of 2 stacker cranes with double the normal depth and 23 metres high with a maximum capacity of 900 kg, and 4 SVL ...