published Wednesday, May 28th, 2014

Chattanooga to head Coca-Cola United's Tennessee Valley Division

HOW BOTTLING WORKS

Coca-Cola is not a single entity, and the Coca-Cola Co. does not own or control all its bottling partners. While many view the company as simply "Coca-Cola," the system operates in tiers. Atlanta-based Coca-Cola manufacturers and sells concentrates, beverages bases and syrups, owns the brands and is responsible for consumer brand marketing.

Bottlers, like the Chattanooga Coca-Cola Co., manufacture, package, merchandise and distribute the final branded beverages to retailers and vendors -- grocery stores, restaurants, street vendors, convenience stores, movie theaters and amusement parks -- who then sell the drinks to consumers at a rate of nearly 2 billion servings per day.

Source: The Coca-Cola Co.

ABOUT TENNESSEE VALLEY DIVISION OF COKE UNITED

• Created: 2014

• Territories: Chattanooga, Summerville, Ringgold, Rossville, Fort Oglethorpe, Scotsboro, Dalton

• Headquarters: Chattanooga, site of the world's first Coca-Cola bottling company

• Workers: 476

• Location: 4000 Amnicola Highway

ABOUT COCA-COLA UNITED

• Name: Coca-Cola Bottling Co. United, Inc.

• Founded: 1902

• Size: Third-largest Coca-Cola bottling company in the U.S.

• Headquarters: Birmingham, Alabama.

• Markets: Augusta, Ga.; Baton Rouge, La.; Birmingham, Ala.; Brunswick, Ga.; Chattanooga; Cullman, Ala.; Gulfport, Miss.; Hattiesburg, Miss.; Lafayette, La.; Lake Charles, La.; McComb, Miss.; McRae, Ga.; Milledgeville, Ga.; Oxford, Ala.; Savannah, Ga.; Scottsboro, Ala.; Spartanburg, S.C.; Statesboro, Ga.; Waycross, Ga.; and West Alabama.

• Production facilities: 3

• Distribution sales centers: 19

• Employees: More than 3,000

Source: Coca-Cola United

Coca-Cola Bottling Co. United, the Birmingham-based bottling giant that controls the Chattanooga market for Coke's flavored fizz, has closed a deal to expand the Chattanooga Coca-Cola Bottling Co.'s territory by 40 percent, creating the newly formed Tennessee Valley Division of Coke United.

The expansion consists of a chunk of territory centered in Scottsboro, Ala., and Dalton, Ga., that was formerly controlled by the Coca-Cola Co. itself. The new Tennessee Valley Division also will include Summerville, Ringgold, Rossville and Fort Oglethorpe and the Chattanooga area.

It's part of a plan by Atlanta-based Coca-Cola Co. to refranchise its territory back to independent bottlers, based on a plan that will see Coke focus on creating and marketing drinks, while the bottlers take care of the actual bottling, sales and distribution.

"We call it the system for the future," said Walker Jones, community relations manager for Coca-Cola United.

The Coca-Cola Co. announced in 2013 that it intended to grant new, expanded territories to five U.S. bottlers: Coca-Cola Bottling Co. Consolidated, Coca-Cola Bottling Co. United Inc., Swire Coca-Cola USA, Coca-Cola Bottling Co. High Country and Corinth Coca-Cola Bottling Works Inc. Together, the five biggest bottlers control more than 90 percent of all the Coke products produced in the U.S.

"Together with Coca-Cola United, we believe a strong franchise system is critical to our success and achieving our 2020 Vision," said Sandy Douglas, group president for Coca-Cola North America. "With this announcement we continue our efforts to create a more contemporary, agile and customer-focused operating model."

While the addition of the Scottsboro and Dalton territories to Coke United's portfolio are a significant upgrade for the Chattanooga Coca-Cola Bottling Co. and for Coke United, the third-largest bottler in the U.S. is poised to grow even more if a handful of deals currently underway -- including acquisitions in Montgomery, Alabama and Tuscaloosa, Alabama -- close this year as planned.

If those plans pan out, Coca-Cola United will eventually add most of Alabama and part of the Florida panhandle to its territory, growing by 45 percent through the end of 2014, officials said.

While past consolidations have seen Coke bottlers shutter some redundant facilities, there are no plans to do that currently, said Jones.

"Certainly things can change, but at this point our plan is to operate in the current locations," Jones said. "Some of the consolidation has already occurred, and there could be even more, although our business model with Coca-Cola United is to be very community-driven, and to be as close to your customers as you can be."

Scottsboro is only a sales and distribution office, much of the bottling was performed at other facilities. Chattanooga's Amnicola facility -- which the company plans to expand -- is expected to produce the drinks for Coca-Cola United's new territory, she said.

"We have five production lines here, so as you can imagine, we can produce a lot," she said. "At one point one of the can lines here did over 2,000 cans per minute, it takes your breath away."

Contact staff writer Ellis Smith at 423-757-6315 or esmith@timesfreepress.com with tips and documents.

about Ellis Smith...

Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...

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