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Principles of Food, Beverage and Labor Cost Controls
21 February 2010 | Angeline Albert
A productive supply chain helped push up profits at drinks
manufacturer Dr Pepper Snapple Group.
The group, which has published its fourth quarter and full
year 2010 financial results, said supply chain efficiencies helped boost its segment operating profit
(SOP) by 3 per cent “reflecting net sales growth and supply chain productivity
2010, net sales rose by 2 per cent, when compared to the previous year. Overall the
beverage group’s net sales were up by 4 per cent for the quarter and efficiencies
were made despite higher costs.
The group said supply chain productivity benefits
were “partially offset by a [£11.7 million] $19 million increase in marketing,
higher packaging, ingredient and transportation costs”. They were also affected
by “higher LIFO-related [last-in-first-out] inventory
provisions”. This inventory costing method assumes the last
items placed in inventory are the first sold during an accounting year.
Reported income from operations for the quarter was
$268 million (£165 million) compared to $251 million (£155 million) in 2009.
Group president and
CEO Larry Young said the company accomplished a lot in 2010. “Strong
innovation, the national launch of Sun Drop and continued marketplace
investments, gives me great confidence in our ability to grow and enhance the
returns of this business in 2011 and beyond," he added.