Second setback for Coca-Cola as Dominos choose Pepsi

Second setback for Coca-Cola as Dominos choose Pepsi

Coca-Cola Amatil has suffered another setback after losing a contract to major rival Pepsi/Schweppes to stock soft drinks and bottled water at hundreds of fast-food shops across the nation.

The decision by pizza giant Domino’s to switch drinks suppliers is the second recent blow for Coca-Cola Amatil, after Woolworths refused to stock its latest product, Coca-Cola No Sugar, at its supermarkets.

Coca-Cola’s deal with Domino’s was said to have accounted for a million cases of drinks a year.  Photo: Vincent Mundy

The news on both moves broke on Thursday which saw Coca-Cola Amatil’s share price fall 3.36 per cent to $8.91.

Deutsche Bank said Coca-Cola Amatil’s deal with Domino’s accounted for 0.3 per cent of its overall volume, or one million cases of drinks, a year.Analyst Michael Simotas said it was a “clearly negative development” for the company.A Coca-Cola Amatil spokeswoman said the company was “always disappointed when customers choose not to make our products available to their customers, but respect their decision to do so”. “Our great range of globally iconic brands and local favourites are still available across the majority of quick service restaurants in Australia,” she said.

The company’s chief executive in Australia and New Zealand, Nick Knight, said the new partnership followed extensive customer testing.

Among Domino’s new range are Pepsi, Pepsi Max, Sunkist, Solo, 7UP, Mountain Dew and Cool Ridge water.

Commenting on its decision not to stock Coca-Cola No Sugar, supermarket giant Woolworths said its customers already had “ample choice” of no-sugar or low-sugar cola.

“We have taken the decision to not range this product at this time,” a Woolworths spokesman said.

Woolworths continued to stock Coke Zero, which remains popular and it is understood there has not had strong demand from customers to stock the new product.

Coca-Cola Amatil is handing out two million free samples of Coca-Cola No Sugar around the country over the next eight weeks and has launched a free-to-air advertising campaign with the slogan “Say yes”.

The new drink, which is stocked at major retailers including Coles, 7-Eleven and Hungry Jack’s, is Coca-Cola’s biggest product launch since Zero in 2006 and it is seen as crucial to arresting a slide in the sales of soft drinks, as customers veer towards bottled water and other healthier options.

“We’re entirely confident that Coca-Cola No Sugar will be a huge success,” a company spokeswoman said, pointing to research that the new drink appealed to customers.

The spokeswoman said the product would be on “thousands” of shelves in other supermarkets and convenience stores.

“So it will be everywhere in the market, in order to meet demand.”

by Nick Toscano

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