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- January 08, 1979
- Vol. 11
- No. 1
J. Paul Austin, First Over the Wall, Prepares to Teach China What Things Go Better with
For Austin, who has personally supervised the Coca-Colanization of the world from developing Africa to Asia, adding China was the capstone of 30 years with the company. He first visited Peking in 1975 and met government officials involved in beverages. "The Chinese are sociable people," Austin observes. "They like to have soft drinks. I don't say it was inevitable. That would be a bit brash. But it was a natural development."
Austin played the waiting game, though it could not have been easy (an acquaintance said his success at Coke was due to "an ability to make decisions quickly and be lucky to have them turn out right"). "My attitude was not pushy," Austin explains, "but to say that in the normal course of events it would be most likely that they would enter foreign trade. And when they did, the way to signal it to the world at large was to bring Coca-Cola in—as the symbol of U.S. foreign trade."
Perhaps the hubris is earned. Austin, a native of LaGrange, Ga., went to Coke as a young lawyer fresh out of Harvard in 1949—the same year the soft drink was banished to Taiwan along with the Kuomintang. Ten years later he was appointed head of the company's export division. Since then Coke's exports have multiplied twentyfold, and though China will not immediately add much to the total ("Initial expenditures will far outweigh income," he says. "That's the nature of going into business in Timbuktu"), the potential is clear.
The timing of the Coke and White House announcements naturally raised the question of whether Austin had the help of a friend named Jimmy Carter. They have been close since Carter was governor. Austin introduced "Jimmy Who" to a lunch of Democratic fat cats in New York in 1976—and backed the Carter campaign to the maximum. It seems possible that the Chinese extended unbidden courtesies to the friend of a friend—much the way Russia in 1973 gave marketing rights to PepsiCo, whose chairman, Donald Kendall, was one of President Nixon's most generous backers. In any case, no one could say the Carter White House has been unkind to Coke: A 50-year ban on the drink in Portugal, for example, was lifted just before the U.S. granted a $300 million loan to that country. Austin insists "there was no connection whatever" between his deal with China and Carter's. "It would be unfair to the President to impute that the White House was used."
Now Coke must deal with the logistics. The first shipments are due in Peking and other major cities within the month. A bottling plant will be built in Shanghai later in the year. Then there is the task of educating the Chinese to the Real Thing. "Only isolated individuals there remember what Coke was like," Austin says. He relishes the challenge (and is clearly not looking forward to mandatory retirement in 1980). "There is an old saying," he muses, "that even the largest wall is laid one brick at a time."
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