Newspaper article St Louis Post-Dispatch (MO)

China Is It Coke Invests $150 Million in Huge Market

Newspaper article St Louis Post-Dispatch (MO)

China Is It Coke Invests $150 Million in Huge Market

Article excerpt

If consumers in China drank an average of just one extra can of Coca-Cola a year, the soft drink maker would sell over a billion more Cokes.

Numbers like that make executives at Atlanta-based Coca-Cola Co. beam as they ponder their reborn business in China, home to one of the world's fastest growing economies.

"People predict confidently, ourselves included, that within a short time China will be the largest soft drink (market) in Asia," said Douglas N. Daft, president of Coca-Cola's Pacific Group.

As China moves further toward a market economy, Coca-Cola is stepping up its presence in the world's most populous nation.

Red kiosks emblazoned with the familiar Coke logo translated into Chinese characters appear in crowded parks and on city streets. More significantly, Coca-Cola bottling plants are springing up all across the country.

This year alone, Coke has announced plans to invest $150 million in five new Chinese plants. The company expects to have 23 plants in China by 1996.

"There are 1.2 billion soft drink opportunities in China. That's an awesome number of people," said Emanuel Goldman, a beverage industry analyst at PaineWebber Inc. "One of Coke's greatest strengths is its ability to effect widespread distribution, and that's what is going on today."

The company doesn't release country-by-country revenue or profit figures, but Coca-Cola says it sold 75 million cases (with each case representing 24 eight-ounce servings) in China in 1992 and 100 million cases this year through September.

China was one of Coca-Cola's first overseas markets, with bottling plants established in Shanghai and Tianjin in 1927. Reviled as a symbol of hated U.S. imperialism by China's Communist Party, Coca-Cola was forced to leave in 1949.

The company returned in 1979, when China launched its economic reforms and began welcoming foreign investors, opening the first of a series of plants on the more prosperous coast. …

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