👉 Background: The Coca-Cola company is the American multinational corporation best known for its delicious fizzy drink with a formula that is still a trade secret.

👉 What happened: Late last week, Coke and Pepsi both released their quarterly results that beat Wall Street expectations. In particular, Coca-Cola one-upped Pepsi with a 2% growth in volume and $11.95 billion USD in revenue for the quarter.

👉 What else: But with soft-drink sales not quite 'fizzing' right now, investors are looking at ways for both Coke and Pepsi to reduce costs. However, their manufacturing processes are very different.

What's the key learning?

💡Owning the supply chain or assembly line isn't always the most profitable path.

💡One of the big differences between Coke and Pepsi is how they bottle their drinks. Coca-Cola collabs with independent bottlers who manufacture, package, and ship their drinks. Whereas Pepsi's process is a bit more DIY - it owns more than 75% of their bottling operations in North America.

💡While that ownership gives Pepsi more control, it also means they have to tie up a lot more resources and cash in bottling their carbonated drinks. And in the current environment with fizzy drinks on the decline, the cost of bottling in-house just doesn't seem worth it.

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