ASSOCIATE NEWS | ISSUE 22 | SPRING 2018
CANADA
UNITE
REFRANCHISING THE CANADIAN BOTTLING OPERATION Letter of Intent Signed
Meet LARRY TANENBAUM and JUNIOR BRIDGEMAN Read more on page 3.
CANADIAN NEWS
QUICK HITS
FROM BILL Welcome to the spring edition of UNITE. As you have probably all heard, The Coca-Cola Company has signed a non-binding letter of intent to refranchise Coca-Cola Refreshments Canada to a group led by Larry Tanenbaum, O.C. (Order of Canada) and Junior Bridgeman. You can read more about Larry and Junior on page 3. This is an exciting time of change for our business, with the transition to CONA (Coke One North America) and System of the Future later this quarter and refranchising in the works.
Look for the new Coca-Cola Zero Sugar recipe on shelves now!
All of the successes we have achieved -- from accelerating revenue growth behind the dramatic increase of innovation and improving execution to increasingly digitizing our operations toward our journey towards becoming a world-class bottler -- are examples of the outstanding contributions each of you at CCRC have made. We’ve had a very strong revenue start to the year -all three operating units (led by Central) and every single market unit (led by Hamilton and Toronto/Kingston) are growing revenue.
The new recipe now tastes and looks more like Coca-Cola. Give it a try and experience the great Coke taste, still with zero sugar and zero calories because we’ve nailed it!
Importantly, safety performance has improved by 30% in 2018! The Quality index is also up nearly 13% compared to a year ago. On the Planning, Production and Distribution front, our teams were amazing. Week after week, actual sales exceeded forecast. Yet, the Supply Chain team reacted, despite over-delivery, all while simultaneously launching an unprecedented number of new SKUs and reorganizing the distribution ecntres and picking areas to accommodate them.
DEAR LEO
We’re building on all of that success in Q2 as we reach an important pivot point in our business. This spring we have the chance to complete the play with the fi nal wave of innovation until late August. We have exciting Hydration, Sports, Sparkling and Energy launches underway this spring. And, as always, we want to continue to make previous waves of innovation visible. We create unstoppable momentum when each wave of initiatives builds on rather than replaces the previous waves.
Our Local Ethics Officer (LEO) is here to answer all of your questions about operating ethically.
Let’s continue to focus on these launches and stay aggressive on space, leveraging the new Sparkling package sizes (you can read more about these on page 5) to increase Sparkling SOVI (share of visual inventory) in-store. As the weather warms up, we have the opportunity to drive single serve -- especially in Small Store and Food Service On-Premise outlets. This is especially critical because as always, mix matters most.
Dear LEO, This requirement to always display my Company I.D. badge is annoying. I’ll carry it when necessary, but do I have to have it on me at all times?
I know we will continue to execute with excellence, to innovate and win with our customers during the transformative time. I can’t wait to see what we accomplish together in Q2! As always, thank you for all that you do for Coca-Cola.
- Badge-free fan Dear Badge-free fan, We have security precautions in place and everyone is expected to comply. In complying, we drastically reduce opportunity for outsiders to enter our Company premises and therefore we are protecting valuable Company information and assets, not to mention the safety of all employees.
Cheers,
- LEO
WE WANT TO HEAR FROM YOU! Email canadacommunications@coca-cola.com
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Associate News ISSUE 22 • SPRING 2018
CANADIAN NEWS
THE COCA-COLA COMPANY ANNOUNCES LETTER OF INTENT FOR REFRANCHISING OF CANADIAN BOTTLING OPERATIONS The Coca-Cola Company has signed a non-binding letter of intent with Larry Tanenbaum, O.C. (Order of Canada) and Junior Bridgeman to refranchise Coca-Cola Refreshments Canada. Through a new Canadian-based joint venture, these two proven leaders will bring their distinctive skills and expertise to support the long-term growth and success of the Coca-Cola business in Canada. This letter of intent marks an important milestone in the Company’s refranchising journey as it puts in place the final non-binding agreement needed to complete the refranchising of all our company-owned bottling operations in North America. Currently in the due diligence phase, the prospective buyers are evaluating the business and the letter of intent is subject to the parties reaching definitive agreements, expected to occur later in the third quarter of 2018. Larry Tanenbaum, a prominent Canadian businessman and philanthropist, leads The Kilmer Group, which has a long-standing history of successful businesses throughout Canada, including Maple Leaf Sports & Entertainment. Larry said in an interview with the Globe and Mail that that he and his businesespartner and son, Ken Tanenbaum, had spent several years “searching for a large-scale business in which we could apply our entrepreneurial energy and which we could love and nurture with a multi-generational perspective.” Junior Bridgemenalso approaches the new venture with a multi-generational perspective after an extensive 30-year career as the owner and operator of one of the largest franchise restaurant operations in the United States. Junior joined the Coca-Cola bottling system in 2017 with the formation of Heartland Coca-Cola, covering territories in Kansas, Missouri and southern Illinois. “Coca-Cola has been a big part of my life and I am excited for this opportunity to be part of the Canadian business,” said Junior Bridgeman. “Larry and I are committed to building on the traditions of The Coca-Cola Company while leveraging our heritage of putting people first, serving our local communities, and refreshing Canadians from coast to coast to coast.” The two leaders take a customer-centric approach to the new venture, with Brideman’sextensive franchise leadership experience, he brings an in-depth customer focus to the bottling operation. Ken Tanenbaumechoed that approach, emphasizing that their strategy will be to work closely with store owners and sales channels to boost sales noting, “there’s a revolution playing out in retailing, and the customer will tell us where they want products. Our job is to always be an arm’s length from desire.”
PROJECTED TIMELINE FOR REFRANCHISING March 2018
Due diligence proceedings
Non-binding letter of intent signed
Q2-Q3 2018
Q3 2018
Q4 2018
Definitive agreement reached
Transition to new ownership
New ownership In operation
LARRY TANENBAUM, O.C. • • • •
Canadian philanthropist and business leader Chief Executive Officer of The Kilmer Group Chairman of Maple Leaf Sports & Entertainment Governor of the National Hockey League and Major League Soccer
JUNIOR BRIDGEMAN • •
•
President and CEO of Heartland Coca-Cola Bottling Company Founder of Bridgeman Foods, operated 200 restaurant franchises National Basketball Association legend
The partnership between Toronto-based Larry and Kansas City-based Junior unites two remarkable entrepreneurs. Both leaders are committed to the betterment of their communities, and invest with a long term vision. UNITE
Associate News ISSUE 22 • SPRING 2018
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CANADIAN NEWS
CONA Q&A AT THE CCRC BOTTLER LEADERSHIP MEETING With the transition to CONA (Coke One North America) happening in a few short weeks, Senior Vice President of Business Transformation, Stephen Du Toit, hosted a panel of CONA experts at the Coca-Cola Refreshments Bottler Leadership Meeting in February for a question and answer period.
Question: How much did CONA impact your daily routine? Danny Holstead, Chief Financial Officer, Coca-Cola Southwest Beverages (formerly Chief Financial Officer, Coca-Cola Refreshments Canada): “When you think about Day 1, everything needs to be set and it’s a big undertaking. But the transition team knows how to do this stuff, and they know how to do it seamlessly. The day after launch, we were churning 500,000 cases from 35 facilities. We were up and running and it just continued as business as usual from there.” Kady Slavin, Assistant Vice President, System Transformation Operations, The Coca-Cola Company: “One of the things that gives us all confidence is our standard playbook for System of the Future. We’ve done it dozens of times...Our standard play is going to work. We have the perfect recipe for success.”
From left to right: Stephen Du Toit, Senior Vice President, Business Transformation Office for CCRC, Stephen Satchel, Senior Director, People, Strategy and Transformation for CCRC, Kady Slavin, Assistant Vice President, System Transformation Operations for The Coca-Cola Company, Danny Holstead, Chief Financial Officer for Coca-Cola Southwest Beverages and Dave Thornton, Business Process Director for Coca-Cola Refreshments.
Question: How do you stay focused on delivering the business plan through the transition process? Danny Holstead: “Trusting the system is key. Each and every person in the system has been trained leading up to Day 1 and each person needs to stay focused on what they have do to. On Day 1 you go, ‘OK this is it, we’ve just dispatched our first route’ – and it works. You concentrate on it so much that first day, but after that, you’re back to business as usual as long as you stay focused on the priorities.” Dave Thornton, Business Process Director, Coca-Cola Refreshments: “The training is so comprehensive that it becomes engrained in the process and it’s clear what needs to be done. It’s still the same company, delivering to the customer and that’s we have to focus on.”
Question: What’s the significance of the CONA training? Stephen Satchel, Senior Director of People, Strategy and Transformation, CCRC: “We have 55,000 hours of training slated for Q2. It’s the largest number of training hours we’ve ever allocated in CCRC history.” Dave Thornton: “The importance of the training is that we’re not training for Day 1. We’re training for Day 1 and beyond. The knowledge that will be acquired of the new processes will help sustain and continuously improve the new processes and the overall business.”
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Associate News ISSUE 22 • SPRING 2018
CANADIAN NEWS
CHECK OUT OUR NEW PRODUCTS! CHANGING THE GAME IN THE HYRDATION CATEGORY WITH POWERADE ZERO AND vitaminwater active
POWERADE ZERO joins the Coca-Cola portfolio in Canada this quarter with three flavours: Fruit Punch, Mixed Berry and Strawberry. Made with natural colours and flavours, the zero-calorie sports beverage also boasts an advanced electrolyte system. Also making a splash in the hydration category is the new vitaminwater active. Standing out as an excellent source of antioxidant vitamins C and E, vitaminwater active contains 10% coconut water and a naturally-sourced electrolyte from sea salt. Enhanced with three key B vitamins and available in three refreshing flavours: strawberry black cherry, orange mango and lemon lime, vitaminwater active comes in a 100-calorie, 450 ml bottle flavor that’s filled with all natural colours and flavours to hydrate consumers on the go.
DRIVING SOVI WITH NEW SPARKLING PACKS SOVI can soar with the launch of new 4x310 mL packs from Sprite and Fanta, and the expansion of our 6x222 mL minican offering with A&W and Barq’s joining the lineup.
UNITE
Associate News ISSUE 22 • SPRING 2018
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EAST REGION NEWS
FROM ROBERT Spring is here and, as you know, it is time to shift our mindset into growth mode to address the warmer days ahead of us, which will certainly convert into thirsty consumers and generate bigger orders from our customers. I want to express my sincere thanks and congratulations on the results so far this year. Without your leadership, dedication, and long hours of hard work, we would not have been able to meet our year-to-date goals of revenue and innovation launches. With all these new brands, we expect to reach a new group of consumers who will appreciate our beverages portfolio. Your persistence and attention to detail have paid off and I know you can make a significant contribution to the warm season ahead of us. I have observed your work as I travel around the OU on several occasions now and fi nd your enthusiasm and passion for our business very contagious! I have no doubt that you will continue to show the same high level of commitment in the coming months and I am very grateful for the great work you all do for the success of the east OU! Each and every one of you continues to be a great asset to our organization. Thank you for all you do. - Robert
Q1 CLOSES WITH 12 NEW CUSTOMERS IN THE EAST
The fi rst quarter of the year closes with a dozen new customer agreements in the East. The twelve new customer outlets, including Pizza Girls, Au Coq, Sbarro and Steve’s Dinner have all signed agreements that drive our high-profit immediate consumption packages and will collectively result in $500,000 in incremental revenue this year alone. In Nova Scotia, family-friendly pizza, burger and shawarma chain, Pizza Girls, has three locations in Bedford, Sackville and Dartmouth. Rotisserie chicken chain, Au Coq, has operated in Quebec for five decades and now has four locations. Large American pizza chain, Sbarro, has expanded into the East with two new restaurants in Ottawa with Coca-Cola as their partner. A 1950s-style diner in Moncton, New Brunswick, Steve’s Diner has been a family favourite in greater Moncton since 1991.
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Associate News ISSUE 22 • SPRING 2018
EAST REGION NEWS
CUSTOMER CORNER: MONTREAL’S OLYMPIC PARK Montreal’s famed Olympic Park is selling Coca-Cola once again! After more than a decade without an agreement, the Olympic Park ultimately chose Coca-Cola not only for the robust commercial offer, but also in large part due to the company’s proven track record of community involvement in the area. Key Account Development Manager, Sophie DeChamplain, and Director of Sales, Katryn Montpetit, collaborated with Director of Public Affairs and Communications, Antoine Tayyar, to put forth a strong proposal highlighting the work Coca-Cola has done in the community. Tayyar, who also serves as President of the Quebec Special Olympics and as a Director of the Montreal Chamber of Commerce, worked to receive endorsements from community groups that Montpetit and DeChamplain seamlessly integrated with their comprehensive bid for the business. Pictured left to right: Key Account Development Manager, Sophie DeChamplain, Director of Public Affairs Built for the 1976 Montreal Summer and Communications, Antoine Tayyar and Director of Sales, Katryn Montpetit at the Olympic Park. Olympics, the multipurpose facility is a landmark in the city and serves as a hub of activity for concerts, sporting events and trade shows. Nicknamed “The Big O”, a reference to both its name and to the doughnutlike shape, the stadium has the largest permanent seating capacity in Canada with more than 56,000 seats. With extensive plans for renovation and expansion, the opportunities to grow this business are endless.
CELEBRATING OUR PEOPLE Retiree Recognitions Normand Sirois Michel Filiatrault
QC QC
Milestones Jean Brisebois Yves St Onge Harry Smith Louis-Marie Cauchon Roger Marsden Geoffrey Smith Calvin Webber Chris Dumbleton Pierre Gazaille Julien Desy Catherine McMullin Don Latimer Bernard Theniere Michael Flageol Mario Laforme Cletus Chiasson Paul Chiasson Jean-Pierre Cormier Brent Savoie
YEARS OF SERVICE
41 41 YEARS OF SERVICE
QC NB ON QC NB NB NS ON QC QC NS ON QC QC QC NB NB NB NB
45 35 35 35 30 30 30 30 30 30 25 25 25 20 20 20 20 20 20
East Region
Milestones Matt Brooks Thomas Forret Brent Mackenzie Bryan McFawn Randy Sharpe Luc Boislard Jeffrey Gilbert Jamie Campbell Bernie Cunningham Mark Martin Jason Woodman Sebastien Leduc Guy Boileau Yvan Chenard Daniel Lysight Sandra Dupuis Gordon Little Arthur Austin Fred Randell Michael Dupuis Hugh Thompson Bill Fillier William McCullough
UNITE
YEARS OF SERVICE
NB NB NB NB NB QC NS NS ON ON ON QC QC QC QC QC NB NB ON ON ON ON ON
20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20
Milestones Pierre Drouin Francis Berthiaume Troy Beach Sebastien Morrissette Garth Arsenault Terry Gallant Billy MacLellan Brian Thompson Eric Boivin Pierre L’heureux Richard Langlouis Denis Martel Dominique Potvin Daniel Noel Stephane Boudreau Michael Williams William Rideout William Evans Eric Dewar Mark Ongo Daniel Meuse Daniel Comeau
Associate News ISSUE 22 • SPRING 2018
YEARS OF SERVICE
ON ON ON ON PEI PEI PEI PEI QC QC QC QC QC QC QC NB NF NF NF NS NS NS
20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20
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CANADIAN NEWS
CANADA QUALIFIES FOR THE WOODRUFF CUP The Canada Business Unit has qualifi ed to compete for the 2017 Woodruff Cup (pictured left). The annual award honours the top-performing business market in The Coca-Cola Company’s worldwide business system. This year’s nomination marks the fi rst time the Canada BU has qualifi ed the Woodruff Cup since 2012. Nominated alongside seven other business units from around the world, this nomination comes from outstanding collaboration on key deliverables between Coca-Cola Refreshments Canada, Food Service On-Premise and The Minute Maid Company of Canada Inc. in 2017. The Robert W. Woodruff Cup – named after our company’s longtime leader and one of the 20th century’s premier business leaders – rewards the business unit that meets or exceeds its business plan for net revenue and profit before tax – as well as grows value share versus the prior year. In Canada, this was also accomplished during a year of unprecedented change. President of Coca-Cola Ltd., Shane Grant, said of the nomination, “this important milestone demonstrates that we are making the right changes for the business, our consumers and our customers. It also demonstrates the power of our new operating model – that all of our employees are making significant process in executing.” The winner of the Woodruff Cup will be announced on May 20.
NEW HANDHELD DEVICES TO ROLL OUT WITH CONA The transition to the Coke One North America (CONA) system takes place later this quarter on May 26. With the transition to CONA comes a series of new devices to equip our teams. Here’s a preview of just two of the new devices you’ll be seeing in the coming months. The aging delivery handhelds that our drivers use will be replaced with the Zebra TC75 (pictured bottom left), which have better battery life and smartphone capabilities. Service technicians and sales associates will also be utilizing new devices, saying goodbye to the bulky Panasonic Toughbooks and Dell tablets and hello to Samsung Galaxy tablets (pictured bottom right). Both the Zebra TC75 and Samsung Galaxy tablets have been extensively researched, tested and selected for their easer of use, durability and lightweight design. These new devices bring updated and scalable technology to the business and enable our field teams to go to market faster.
DID YOU KNOW? Between 2013 and 2017, more than 55,000 associates experienced System of the Future transitions in the U.S., and the vast majority of these associates became CONA users.
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Associate News ISSUE 22 • SPRING 2018
TRANSFORMING OUR FUTURE TOGETHER
President and Chief Executive Officer of The Coca-Cola Company, James Quincey presents Prime Minister Justin Trudeau with polar bear socks at the World Economic Forum in Davos, Switzerland.
JAMES QUINCEY MEETS JUSTIN TRUDEAU President and Chief Executive Officer of The Coca-Cola Company, James Quincey (pictured left) met with Prime Minister Justin Trudeau (pictured right) in Davos, Switzerland at the World Economic Forum earlier this year. During the meeting, Quincey shared the Company’s leadership through our Beverages for Life strategy, including our work to reduce sugar and calories from our beverages in Canada. We also discussed the Company’s ongoing commitment to sustainability, specifically our new World Without Waste strategy. Of the meeting, Trudeau tweeted, “I had a great first meeting with James Quincey, the new CEO of @CocaCola, focused on investing in Canada to create more jobs and how we can protect our oceans.” Quincey also presented Trudeau, a known fan of eclectic socks, with Coca-Cola polar bear socks for the meeting.
DID YOU KNOW? In 2016 Coca-Cola was the first Fortune 500 company to return to nature an estimated 115% of the water used in the production of its drinks. This water replenishment target, which the company first set in 2007, was achieved a full five years before its deadline.
UNITE
Associate News ISSUE 22 • SPRING 2018
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TRANSFORMING OUR FUTURE TOGETHER
OUR WAY FORWARD
is part of our strategy to become a total beverage company. We’re taking action “Inside the Bottle” and “Outside the Bottle” to give people the drinks they want – including options with less sugar – and the information they need to make informed choices. These actions can be remembered as RED CAN.
CONVENIENT,
REDUCE SUGAR We’re making low- and no-sugar versions of the drinks you love easier to find. In Canada, we offer more than
beverages, including 70 low- and no-calorie options.
EVOLVE RECIPES
SMALLER PACKAGES
Making it easier to control sugar.
100%
of our core sparkling brands in Canada come in packages of 237 mL or less. We also right-sized our 591 mL PET bottle to 500 mL – a 15% reduction in size.
ACCESSIBLE
140
INFORMATION
We’re looking to make many of our beverages better and more
EASY-TO-FIND
CALORIES PER CAN
calorie information right up front so you can make informed choices.
by providing vitamins, minerals and electrolytes that help fuel your body.
NO ADVERTISING TARGETED
We’re also adding new, sophisticated flavours to keep up with rapidly evolving taste preferences.
TO CHILDREN UNDER 12
We’re following our longstanding policy not to target advertising to children under age 12.
DIFFERENT DRINKS Realizing not everyone drinks soda, we’re making
We do not place advertising in media where the audience is over
35% children under 12.
like organic tea, coconut water, grab-and-go coffee, juices and purified water more readily available.
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Associate News ISSUE 22 • SPRING 2018
TRANSFORMING OUR FUTURE TOGETHER
WORLD WITHOUT WASTE CAMPAIGN LAUNCHES The Coca-Cola Company is leading the industry in announcing a bold, ambitious goal: to help collect and recycle a bottle or can for every one we sell by 2030. This goal is the centerpiece of our new global packaging vision, World Without Waste. The Coca-Cola Company and its global network of bottling partners will tackle the ambitious goal, which is part of a holistic plan called “World Without Waste,” through a renewed focus on the entire packaging lifecycle – from how bottles and cans are designed and made, to how they’re recycled and repurposed. To help improve recycling rates, Coca-Cola will apply its global marketing muscle to help educate the public on what, how and where to recycle. The Company also will continue to team with local communities, NGOs, industry peers and consumers to help make recycling easier and more accessible for everyone by improving local recycling systems and driving policy change that supports a truly circular economy. Vice President of Public Affairs for Coca-Cola Ltd., Ron Soreanu, added, “in partnership with governments and communities, Coca-Cola Canada already helps to recover over 70% of bottles and cans in communities across the country. In addition, we divert an average of 97% of the waste generated by our facilities from landfill. We won’t reach our goal of 100% collection and recycling by 2030 alone, it will take collective action to make a real difference.”
UNITE
Associate News ISSUE 22 • SPRING 2018
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Learn more about the new World Without Waste campaign on page 11 or at www.coca-cola.ca