During the past six years, Coca-Cola
FEMSA's Mexican operation has been distinguished
by two parallel characteristics aggressive growth
in both per capita consumption and productivity. In
the Valley of Mexico and the Southeast Territories,
per capita consumption increased from 300 and 210 in
1994 to 417 and 240 in 1999, respectively, and annual
unit cases per employee increased from 22 and 22 to
36 and 26. Combined, these improvements have driven
Coca-Cola FEMSA's Mexican operating profit growth
of 13.5% on an annually compounded rate.(1)
The Company has also continued to
invest in its Mexican operations, investing approximately
US$560 million in capital expenditures since 1993, resulting
in considerable efficiencies and cost savings. In addition,
consolidation of bottling plants is expected to continue
in the future, helping the Company to adapt to the changing
market environment while removing cost from our operations.
FEMSA continues to augment information systems, working
to fully integrate the entire operation. The Company
has focused on an integrated systems approach. These
systems work to link all aspects of our business from
purchasing to customer service and help the Company
to better understand the markets that we serve, as well
as, improving production and distribution efficiencies.
FEMSA continues to take more responsibility for joint
marketing efforts with The Coca-Cola Company. In
1999, efforts in this regard again culminated in the
Christmas parade through the center of Mexico City.
The Christmas parade was attended by an estimated three
million spectators, and approximately one million people
visited the 90-foot Coca-Cola Christmas tree
and Christmas fair at the entrance of Chapultepec Park
in Mexico City.
In the Southeast, the centerpiece
of the Company's aggressive consumer activation
program is the traveling Coca-Cola Fair, regularly
attended by thousands of consumers.
Growth Coca-Cola FEMSA is
now looking at ways to utilize its world class distribution
system to expand profitably. The Company considers flavored
soft-drinks and bottled water as significant opportunities
for growth within its existing territories.
Coca-Cola FEMSA has begun to redefine
itself for the next 10-20 years, basing its strategies
on new technologies, customer knowledge, and becoming
even more efficient in the utilization of its assets.