Coca-Cola Co Chief Executive Muhtar Kent sought to ease concerns by the Teamsters union that the company's acquisition of the North American operations of Coca-Cola Enterprises would result in fewer jobs.
Even before the deal's expected closure in the fourth quarter, fears have been raised by news that Coke Enterprises will test a program to deliver drinks to 7-Eleven stores in Southern California using Costco Wholesale Corp as an intermediary.
At Coca-Cola's annual shareholder meeting on Wednesday, Kent stressed that the test is one of many being explored in an ongoing effort to find the best method for individual markets.
This test is just one of many tests taking place, Kent said. These kinds of discussions go on across the world with many customers with one objective in mind -- for us, as a fast-moving consumer goods company, to stay ahead of our consumer and customer expectations.
Kent said the test was suggested 2-1/2 years ago by the head of 7-Eleven, which is owned by Japan's Seven & I Holdings Co Ltd <3382.T>.
We are long away from making any decision. It's a pilot. There are a number of different companies participating, Kent said in response to a question from David Laughton, director of the Brewery and Soft Drink Workers Conference of the International Brotherhood of Teamsters.
A handful of Teamsters members handed out fliers and held placards outside the meeting venue in Duluth, Georgia, near Coke's Atlanta headquarters.
We have some concerns about the way Coke is doing their business ... Our main concerns are treatment (of workers), fairness and the direction the company is taking, said national Teamsters organizer Steve Jones.
Inside the meeting, about 408 people gathered a day after the world's largest soft drink maker reported disappointing first-quarter revenue as North American sales continued their decline.
It is that ongoing weakness that helped prompt Kent to decide to consolidate its North American system. PepsiCo Inc , which will report quarterly results on Thursday, closed a similar acquisition in March.
We have to always remain inquisitive, we always have to ask questions, Kent said, adding that when you can't stay ahead of consumer expectations you are bound to fail.
Kent declined to discuss the specific labor-related impact of the deal, since it has not closed. Yet he sought to assure the union that it would have a place in the consolidated company, as it explores different ways of selling drinks.
There is not one size that fits all, Kent said, noting that delivery routes may vary depending on product, destination, packaging and customer. We've got to get our mind used to this new system. This new system, though, does not mean that our partnership cannot continue to grow and prosper.
All four shareholder proposals failed to garner enough votes to pass. The proposals ranged in topic from awards of restricted stock to the chemical bisphenol A, which is widely used in food and drink containers, including by Coca-Cola, and is being investigated for possible health impacts.
(Additional reporting by Matthew Bigg in Atlanta, editing by Dave Zimmerman)