They emphasised the value of leveraging core business activities to foster growth and development, especially in emerging markets.
The Coca-Cola system’s Manual Distribution Center (MDC) programme in Africa was referenced as an example of an innovative solution that advances business goals and the international development agenda. Coca-Cola’s approach to distributing its products in hard-to-reach urban and peri-urban areas in Africa utilises small businesses that deliver Coca-Cola products manually to local, small-scale retailers.
The MDCs account for over 80% of the company’s sales in East Africa, while creating small-business ownership opportunities and jobs for an increasing number of first-time entrepreneurs and women. To date, the Coca-Cola system has created more than 2,500 MDCs in Africa employing over 12,000 people and generating more than $500m in annual revenues.
“For Coca-Cola, the Manual Distribution Centers are a wonderful example of the way business can focus on meeting its consumers’ and customers’ needs while supporting the sustainability of communities,” said Muhtar Kent, chairman and CEO of The Coca-Cola Company. “It has long been our philosophy to look at our business system holistically and determine where we can have the greatest impact on advancing initiatives that are critical to the communities and stakeholders that we rely on.”
The company has been committed to scaling up the number of MDCs in Africa since joining the Business Call to Action – an initiative that mobilises large companies to help reach the Millennium Development Goals by harnessing core business competencies. To determine how best to scale up its model, Coca-Cola asked the Corporate Social Responsibility Initiative at the Harvard Kennedy School and the International Finance Corporation to review the approach.
“There’s a growing recognition in the corporate and international development communities that the most sustainable contribution companies can make to poverty alleviation is to carry out their core business activities in a profitable, responsible and inclusive manner,” said Jane Nelson of the Harvard Kennedy School.
“Our review of Manual Distribution Centers in Tanzania and Ethiopia demonstrates the potential of large corporations to build economically viable business linkages with small enterprises in their value chains, which can also have development benefits,” said IFC director, Toshiya Masuoka.
The research study identified a number of opportunities to further enhance the MDC approach. These include:
Source: The Coca-Cola Company
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