Coca-Cola Consolidated, Inc. and its majority-owned subsidiaries (‘Coca-Cola Consolidated’) distribute, market, and manufacture nonalcoholic beverages in territories spanning various states and the District of Columbia.
The company is the largest Coca-Cola bottler in the United States. Approximately 85% of the company's total bottle/can sales volume to retail customers consists of products of The Coca-Cola Company, which include some of the recognized and popular beverage brands. The company al...
Coca-Cola Consolidated, Inc. and its majority-owned subsidiaries (‘Coca-Cola Consolidated’) distribute, market, and manufacture nonalcoholic beverages in territories spanning various states and the District of Columbia.
The company is the largest Coca-Cola bottler in the United States. Approximately 85% of the company's total bottle/can sales volume to retail customers consists of products of The Coca-Cola Company, which include some of the recognized and popular beverage brands. The company also distributes products for several other beverage companies, including Keurig Dr Pepper Inc. (‘Dr Pepper’) and Monster Energy Company (‘Monster Energy’).
Beverage Products
The company offers a range of nonalcoholic beverage products and flavors, including both sparkling and still beverages, designed to meet the demands of its consumers. Sparkling beverages are carbonated beverages, and the company’s principal sparkling beverage is Coca-Cola. Still beverages include energy products and noncarbonated beverages, such as bottled water, ready-to-drink tea, ready-to-drink coffee, enhanced water, juices, and sports drinks.
The company’s sales are divided into two main categories: bottle/can sales and other sales. Bottle/can sales include products packaged primarily in plastic bottles and aluminum cans. Other sales include sales to other Coca-Cola bottlers, post-mix sales, transportation revenue, and equipment maintenance revenue. Post-mix products are dispensed through equipment that mixes fountain syrups with carbonated or still water, enabling fountain retailers to sell finished products to consumers in cups or glasses.
Beverage Distribution and Manufacturing Agreements
The company has rights to distribute, promote, market, and sell certain nonalcoholic beverages of The Coca-Cola Company pursuant to comprehensive beverage agreements (as amended, collectively, the ‘CBA’) with The Coca-Cola Company and Coca-Cola Refreshments USA, LLC (‘CCR’), a wholly owned subsidiary of The Coca-Cola Company. The CBA relates to a multi-year series of transactions through which the company acquired and exchanged distribution territories and manufacturing plants. The CBA requires the company to make quarterly acquisition-related sub-bottling payments to CCR on a continuing basis in exchange for the grant of exclusive rights to distribute, promote, market, and sell the authorized brands of The Coca-Cola Company and related products in certain distribution territories the company acquired from CCR. In addition to customary termination and default rights, the CBA requires the company to make minimum, ongoing capital expenditures in its distribution business and to meet certain minimum volume requirements, gives The Coca-Cola Company certain approval and other rights in connection with a sale of the company or the distribution business of the company, and prohibits the company from producing, manufacturing, preparing, packaging, distributing, selling, dealing in, or otherwise using or handling any beverages, beverage components, or other beverage products other than the beverages and beverage products of The Coca-Cola Company and certain expressly permitted cross-licensed brands without the consent of The Coca-Cola Company.
The company also has rights to manufacture, produce, and package certain beverages bearing trademarks of The Coca-Cola Company at its manufacturing plants pursuant to a regional manufacturing agreement (as amended, the ‘RMA’) with The Coca-Cola Company. For prices determined pursuant to the RMA, The Coca-Cola Company unilaterally establishes from time to time the prices, or certain elements of the formulas used to determine the prices, that the company charges for these sales to certain other U.S. Coca-Cola bottlers or to The Coca-Cola Company. The RMA contains provisions similar to those contained in the CBA restricting the sale of the company or the manufacturing business of the company, requiring minimum, ongoing capital expenditures in its manufacturing business, prohibiting the company from manufacturing any beverages, beverage components, or other beverage products other than the beverages and beverage products of The Coca-Cola Company and certain expressly permitted cross-licensed brands without the consent of The Coca-Cola Company, and allowing for the termination of the RMA.
In addition to its agreements with The Coca-Cola Company and CCR, the company has rights to manufacture and/or distribute certain beverage brands owned by other beverage companies, including Dr Pepper and Monster Energy, pursuant to agreements with such other beverage companies. The distribution agreements with Dr Pepper permit the company to distribute Dr Pepper beverage brands, as well as certain post-mix products of Dr Pepper. Certain of the company's agreements with Dr Pepper also authorize it to manufacture certain Dr Pepper beverage brands. The distribution agreements with Monster Energy grant the company the rights to distribute certain products offered, packaged, and/or marketed by Monster Energy. Similar to the CBA, these beverage agreements contain restrictions on the use of trademarks and approved bottles, cans, and labels, and the sale of imitations or substitutes, as well as provisions for their termination for cause or upon the occurrence of other events defined in these agreements. Sales of beverages under these agreements with other beverage companies represented approximately 15% of the company's total bottle/can sales volume to retail customers in 2024.
Finished Goods Supply Arrangements
The company has finished goods supply arrangements with other U.S. Coca-Cola bottlers to sell and buy finished goods bearing trademarks owned by The Coca-Cola Company and produced by it in accordance with the RMA or produced by a selling U.S. Coca-Cola bottler in accordance with a similar regional manufacturing authorization held by such bottler. Pursuant to the RMA, The Coca-Cola Company unilaterally establishes from time to time the prices, or certain elements of the formulas used to determine the prices, for such finished goods. In most instances, the company’s ability to negotiate the prices at which it sells finished goods bearing trademarks owned by The Coca-Cola Company to, and the prices at which it purchases such finished goods from, other U.S. Coca-Cola bottlers is limited pursuant to these pricing provisions.
Other Agreements Related to the Coca-Cola System
The company has other agreements with The Coca-Cola Company, CCR, and other Coca-Cola bottlers regarding product supply, information technology services, and other aspects of the North American Coca-Cola system.
National Product Supply Governance Agreement
The company is a member of a national product supply group (the ‘NPSG’), which is composed of The Coca-Cola Company, the company, and certain other Coca-Cola bottlers who are regional producing bottlers in The Coca-Cola Company’s national product supply system (collectively with the company, the ‘NPSG Members’), pursuant to a national product supply governance agreement (as amended, the ‘NPSG Agreement’) with The Coca-Cola Company and certain other Coca-Cola bottlers. The stated objectives of the NPSG include, among others, Coca-Cola system strategic infrastructure investment and divestment planning, network optimization of plant to distribution center sourcing, and new product or packaging infrastructure planning.
Under the NPSG Agreement, the NPSG Members established certain governance mechanisms, including a governing board (the ‘NPSG Board’) composed of representatives of certain NPSG Members. The NPSG Board makes and/or oversees and directs certain key decisions regarding the NPSG. Subject to the terms and conditions of the NPSG Agreement, each NPSG Member is required to comply with certain key decisions made by the NPSG Board, which include decisions regarding strategic infrastructure investment and divestment planning, optimal national product supply sourcing, and new product or packaging infrastructure planning.
CONA Services LLC
Along with certain other Coca-Cola bottlers, the company is a member of CONA Services LLC (‘CONA’), an entity formed to provide business process and information technology services to its members. The company is party to an amended and restated master services agreement with CONA, pursuant to which CONA agreed to make available, and the company became authorized to use, the Coke One North America system (the ‘CONA System’), a uniform information technology system developed to promote operational efficiency and uniformity among North American Coca-Cola bottlers. As part of making the CONA System available to the company, CONA provides it with certain business process and information technology services, including the planning, development, management, and operation of the CONA System in connection with its direct store delivery and manufacture of products.
Amended and Restated Ancillary Business Letter
On March 31, 2017, the company entered into an amended and restated ancillary business letter (the ‘Ancillary Business Letter’) with The Coca-Cola Company, pursuant to which it was granted advance waivers to acquire or develop certain lines of business involving the preparation, distribution, sale, dealing in, or otherwise using or handling of certain beverage products that would otherwise be prohibited under the CBA.
Markets Served and Facilities
As of December 31, 2024, the company served approximately 60 million consumers within its territories, which comprised five principal markets. The company is also a shareholder of South Atlantic Canners, Inc. (“SAC”), a manufacturing cooperative managed by the Company. SAC is located in Bishopville, South Carolina; and the company utilizes a portion of the production capacity from the Bishopville manufacturing plant.
Raw Materials
In addition to concentrates purchased from The Coca-Cola Company and other beverage companies for use in the company’s beverage manufacturing, the company also purchases sweetener, carbon dioxide, plastic bottles, aluminum cans, closures and other packaging materials, as well as equipment for the distribution, marketing and production of nonalcoholic beverages.
The company purchases all of the plastic bottles used in its manufacturing plants from Southeastern Container and Western Container, two manufacturing cooperatives the company co-owns with several other Coca-Cola bottlers, and all of the company’s aluminum cans from two domestic suppliers.
Along with all other Coca-Cola bottlers in the United States and Canada, the company is a member of Coca-Cola Bottlers’ Sales & Services Company LLC (‘CCBSS’), which was formed to provide certain procurement and other services with the intention of enhancing the efficiency and competitiveness of the Coca-Cola bottling system. CCBSS negotiates the procurement for the majority of the company’s raw materials, excluding concentrate, and the company receives a rebate from CCBSS for the purchase of these raw materials.
Customers and Marketing
The company’s products are sold and distributed in the United States through various channels, which include selling directly to customers, including grocery stores, mass merchandise stores, club stores, convenience stores, and drug stores, selling to on-premise locations, where products are typically consumed immediately, such as restaurants, schools, amusement parks, and recreational facilities, and selling through other channels, such as vending machine outlets.
For 2024, the company’s largest customers were Walmart Inc. and The Kroger Co. Recent and upcoming introductions include Sprite Chill and Coca-Cola Orange Cream in the company’s Sparkling brands portfolio and Topo Chico Sabores in the company’s Still brands portfolio.
The company sells its products primarily in single-use, recyclable bottles and cans in varying package configurations from market to market. For example, there may be up to 25 different packages for Diet Coke within a single geographic area. Total bottle/can sales volume to retail customers during 2024 was approximately 47% bottles and 53% cans.
The company relies extensively on advertising in various media outlets, primarily online, television, and radio, for the marketing of its products. The Coca-Cola Company, Dr Pepper, and Monster Energy make substantial expenditures on advertising programs in the company's territories from which it benefits.
Seasonality
Business seasonality results primarily from higher unit sales of the company’s products in the second and third quarters of the fiscal year (year ended December 31, 2024), as sales of the company’s products are typically correlated with warmer weather. The company and other manufacturers from whom it purchases finished products have adequate production capacity to meet sales demand for sparkling and still beverages during these peak periods.
Competition
The company’s principal competitors include local bottlers of PepsiCo, Inc. products, and in some regions, local bottlers of Dr Pepper products.
Government Regulation
The company is required to comply with a variety of the U.S. laws and regulations, including but not limited to: the Federal Food, Drug and Cosmetic Act and various state laws governing food safety; the Food Safety Modernization Act; the Occupational Safety and Health Act; the Clean Air Act; the Clean Water Act; the Resource Conservation and Recovery Act; the Robinson-Patman Act; the Comprehensive Environmental Response, Compensation and Liability Act; the Federal Motor Carrier Safety Act; the Lanham Act; various federal and state laws and regulations governing competition and trade practices; various federal and state laws and regulations governing the company’s employment practices, including those related to equal employment opportunity, such as the Equal Employment Opportunity Act and the National Labor Relations Act; and laws and regulations restricting the sale of certain of the company’s products in schools.
As a manufacturer, distributor and seller of beverage products of The Coca-Cola Company and other beverage companies in exclusive geographic territories, the company is subject to antitrust laws of general applicability. However, pursuant to the United States Soft Drink Interbrand Competition Act, soft drink bottlers, such as the company, are permitted to have exclusive rights to manufacture, distribute and sell soft drink products in a defined geographic territory if that soft drink product is in substantial and effective competition with other products of the same general class in the market.
The company is also subject to federal, state and local environmental laws, including laws related to water consumption and treatment, wastewater discharge and air emissions. The company’s facilities must comply with the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act, and other federal, state, and local laws regarding handling, storage, release, and disposal of wastes generated on-site and sent to third-party owned and operated off-site licensed facilities.
History
The company was founded in 1902. The company, a Delaware corporation, was incorporated in 1980. The company was formerly known as Coca-Cola Bottling Co. Consolidated and changed its name to Coca-Cola Consolidated, Inc. in January 2019.
