Coca-Cola thinks outside the box

While most of the attention has been on big box retailers struggling to get merchandise from Asia to their stores, the beverage giant reported having problems moving supplies around the world to its bottling plants and distribution facilities.

Due to shortages delaying transportation, and in extreme cases halting it altogether, companies like Coca-Cola have had to get creative with the transportation of goods and materials across the world.

The cost of shipping stuff in containers has gotten so out of hand that Coca-Cola Co. is switching its cargoes to vessels that are normally only used by industrial commodity traders to help keep its business running.

Alan Smith, the company’s procurement director, said on a LinkedIn post.

“When you can’t get containers or space due to the current ocean freight crisis, then we had to think outside the box,” Smith said.

Smith at Coca-Cola explained the strategy saying that the company was moving 60,000 tons of materials to keep its production lines running. He said it was the equivalent of 2,800 TEU.

“For these we are heading to some non-congested ports so we are hoping for a smooth discharge,” Smith wrote. “Good coordination is vital on both the planning and the operations side for loading and discharge.”

Unlike retailers including HomeDepot, Target, Ikea, Costco, and others, Coca-Cola turned to the alternative of using dry bulk carriers and reverting to the older breakbulk approach to moving the materials its needs to maintain operations.

The big advantage of using containers is that they are part of a well-established logistics chain that gets goods efficiently from where they are made to where they are used. Bulkers may be cheaper, but they can be less convenient because the cargoes have to be moved to and from ports.