Coca-Cola expected a cut in its sales forecast for the year 2017 as it struggles with a consumer slowdown in China, sending the drinks group’s shares down with more than 3 percent. The Atlanta-based company expects sales, adjusted for acquisitions, divestitures and currency fluctuations, to rise 3 per cent, compared with its earlier forecast of between 4-5 per cent. They said that the weaker deamand in China was forcing them to drive down inventory. “We have not really assumed China will get better in the rest of the year,” said James Quincey, Coca-Cola’s chief operating officer. He mentioned that juice sales fell double digits in the country and Coca-Cola drinks dropped single digits. “The consumer will take a little more time to come back which is why we’re focusing on a game plan we know that works, focusing on affordability and premium drinks in metro areas,” he explained, adding that he’s confident about the company’s power to gain market share in the country and that Coca Cola is ready for whenever consumer spending picks up again.
After forecasting I would like to describe how inventory planning works. Coca Cola uses perpetual inventory or continous inventory which is good because it describes systems of inventory where information on inventory quantity and availability is updated continuosly as a function. This method records sales almost real-time through a computerized management system(point of sale).
this continous inventory syster gives a highly detailed view on inventory changes and allows real-time reporting of inventory in stock which accurately refcelts the level of goods. This way of inventory planning is by far the most widely used since it can yield reasonably accurate results if properlyy used. It has the competitive edge because reordering is more efficient, interim profit reports can be prepared without doing a stock take, the level of losses or gains can be measured and slow-,