When is a private-label soda not a private-

label? When it’s cobranded with Jones Soda. That’s plan, at least, at c-store giant 7-Eleven, which has enlisted

Seattle soda marketer to create premium CSD entry under its 7-Select rubric using natural flavors, cane sugar (to

tune of 180-195 calories per 20-oz bottle) and 75 mg hit of caffeine. Initial flavor range is Twisted Citrus, Fruit

Loose, Cocolocolilinut, Tropical Slam Rambutan and Bluesberry Smash. Drinks are identified as being crafted

by Jones Soda. As tagline suggests, “This is no ordinary soda.” New items are offered in proprietary PET bottle

featuring embossed 7-Select logo and embossed bubbles to provide tactile experience for shoppers. And taking

leaf from Jones Soda playbook, the labels feature black-and- white lifestyle images submitted by Jones’ and 7-

Eleven consumers. Brand was developed over more than a year, and will be offered only at 7-Eleven chain, with

consumers invited to submit flavor ideas or pics via hashtag #7SELECTxJONES.

WhiteWave offered analysts and investors a

glimpse at some of robust innovation pipeline, including range of new bevs as well as moves to migrate bev

brands like Horizon Organic into categories like cheese and yogurt.

New entries shown to audience at Consumer Analysts Group of NY (CAGNY) meeting in Boca this week

represent effort to broaden participation beyond grocery refrigerated dairy cases to sections like center store,

frozen food and nutritonals, as well as to reach impulse channels beyond natural, specialty and grocery to so-

called away-from- home segment. Plan includes cross-merchandising across channels – say, by melding Silk,

Vega and Earthbound brands for consumers who make smoothies at home – and moving brands like Horizon

Organic milk brand into adjacencies like cheese, butter and yogurt.

On bev front, co sampled single-serve bottles of Horizon and Silk brands, including Horizon Protein+ entry

sporting 15 g of protein, as well as such innovations on multi-serve side as lactose-free version and aseptically

packed shelf-stable 32-oz pack. (BBI monitored presentations online and didn’t get to actually slurp new items.)

WWAV brass showed online ads backing new afternoon pick-me- up called Nutchello as part of effort to move

plant-based milks beyond the cereal bowl (described in BBI last week – Feb 11) as well as effort to tap into $2 bil

banana category with brand called Sir Bananas that just headed into test markets. It’s packed in 62-oz gabletops

sporting cartoon monkey and announces, “Made with real bananas,” along with reduced-fat milk. WWAV execs

said it was formulated with sweet creamy taste to appeal to kids even as bananas’ wholesome nutrition should win

over parents, starting with Bananamilk and Chocolate Bananamilk flavors. It’s backed by rambunctious beat-

heavy ads and slogans such as “This milk is bananas” and “Deliciously smooth, snackably good.”

Tho co is known to have approached DSD houses on shelf-stable single-serve entries, that didn’t come up in

today’s discussion, nor did Stok coffee entry that’s believed to be in development. Out-of- home effort includes

move to boost penetration of creamers beyond the 50K machines already installed across US, with tilt toward

some of better-for- you offerings getting incorporated into conventional brands like International Delight. In core

groceries, meanwhile, consumers have been tilting toward larger sizes of creamers, up 40% in sales to account for

16% of category now, as well as better-for- you entries like non-dairy plant-based creamers. Thus, Int’l Delight

has brought out Simply Pure line containing real sugar, real milk, real cream – “only 5 simple ingredients,” per

positioning.

Much of activity is emanating from R&D center dubbed Green House that was completed last year at triple the

size of previous site, with enhanced pilot plant capabilities and layout conducive to creativity and collaboration,

said coo Blaine McPeak.

Looking to

accelerate move away from tired shelf-stable center-store segments, Campbell Soup said it’s establishing $125

mil venture fund to seek food/bev investments. Move seems to echo efforts undertaken by CPG rivals like Coca-

Cola, PepsiCo and General Mills, but perhaps at more ambitious level. Speaking at Consumer Analyst Group of

NY pow-wow in Boca Raton, Fla, ceo Denise Morrison said fund called Acre Venture Partners would be indie

operation managed by unidentified outside partners with CPB as sole limited partner in fund. Initiative is

intended to accelerate scattered efforts CPB has made to date, which have included direct investment in Juicero

home-juicing play, whose other investors have ranged from tech-oriented players like Kleiner Perkins and Google

Ventures to First Beverage Group (BBI, Jun 18). “We believe a more strategic and methodical approach is

required” in order to tap into new biz models that are emerging at every step of value chain in food biz, she

indicated. That suggests fund will seek opportunities at farm, ingredient and finished goods levels. Denise noted

that, since 2010, some 400 food startups have pulled in more than $6 bil in funding as VC world has funnel

capital to ventures that promise to disrupt the food ecosystem.

SodaStream Int’l offered some positive signs that its transformation from at-home soda maker to sparkling water

maker is making progress, even as its recently recruited head of N Amer biz, John Sheppard, indicated co is

getting ready to open marketing spigot again.

Context was Q4 earnings call, on which Israel-based co reported 10.8% decline in revenue to $112.9 mil.

Revenue sagged in all markets. They were down only 5.4% to $66.9 mil in largest market, Europe, where

Germany, Austria and Switzerland continued strong even as France and Nordic countries proceeded with restage.

In Americas, where co has dramatically pulled back from retail, sales were down 19.3% to $37.2 mil. Asia

Pacific was off 16.8% to $16.4 mil as double-digit growth in Japan was offset by Australian soda-to- water

transition and ongoing issues with Korean distributor. With model count and retail doors cut back, so-called

“starter kits” dropped 24% to 1.02 mil units. But gas refills – a measure of usage among current owners – rose

7% to record 6.23 mil units – “the best indication that the global user base is increasingly consuming sparkling

beverages made at home using SodaStream,” said ceo Daniel Birnbaum. Flavors, in midst of transition to water-

oriented entries, dropped 8% to 6.05 mil units. Adjusted operating income rose 176% to $14.2 mil, helped in part

by cutback in marketing expenses as new plans are formulated.

Q4 sales “were up sequentially and roughly flat year-over- year on a constant currency basis, while operating

income was ahead of plan as we meaningfully leveraged selling and marketing expenses,” summarized Birnbaum.

“There is still work ahead of us in order to position the company for consistent profitable growth, but I am

confident that our recent actions have us heading in the right direction and will create value for shareholders over

the long-term.”

N Amer: Sheppard Sees Revenue Build in Late Q4; Recruits Hain Marketer Froelich-Shea John Sheppard,

familiar figure in bevs (Coke, Icelandic Glacial) who came aboard 3 months ago as Americas chief, described

progress made in getting biz back on track. Revenue decline, tho steep, still beat expectations, and there were

signs of revenue growth toward end of Q4. “Even without a strong media campaign we were able to get some

pretty good sales going through the system,” he observed. Revenue per door increased at double-digit rate at top

3 retail customers in Q4, John noted. Meanwhile, 50% ad cutback boosted operating income. But starting this

week, SODA is back on air in several test markets with campaign showing how SodaStream devices fit into

everyday life. As it rebuilds at retail after past retreat, SODA has hired seasoned acct mgrs and doubled size of

merchandising team. Co also will dial up pr activation, including alliance with Amer Diabetes Assn and

affiliations with medical pros and celebs with diabetes. Co also will push sustainability message that goes back to

initial launch. To develop new marketing plan John in Jan recruited L’Oreal and Hain Celestial vet Emma

Froelich-Shea as marketing vp.

Key priority is to make CO2 gas canister exchanges more convenient. After testing at-home swaps via UPS last

year in parts of NJ and Penn, co will roll out program by year-end. Co is exploring other gas exchange venues

like drugstores and DIY. On product side, it’s bringing out Green Tea, Natural Energy and Coconut Water

concentrate that can be used to produce carbonated or still coconut water. But consumers don’t want to see CSDs

vanish from mix, either, and SodaStream is returning Fountain Mist to fold and adding caffeine-free Diet Cola.

Test with Pepsi in Fla is being expanded. On equipment side, new automated system called The Power had

debuted and will be followed by the Mix and entry-level The Spirit, anticipated to be on view at upcoming

housewares show in Chicago.

Pressed Juicery, LA-based fresh-juice retailer that’s had designs on NY, opened 2d standalone store this week, in

Manhattan’s Upper East Side nabe, following entry into city in Nov with store in so-called NoHo district at edge

of West Village. As at other locations, to make products more accessible, they’re aiming to maintain $6.50 price

point per bottle. Pressed Juicery founders Hayden Slater, Hedi Gores and Carly de Castro have made much of

their modest start in former broom closet in West LA (BBI, Dec 12 2014), but expanded quickly into other

locations in LA and Nev and more recently have added units in NJ and NY, including becoming in-house juice

provider to Equinox Gym chain in city. This year they’re planning other NY locations in Columbus Circle and

near Columbia Univ, as well as in other East Coast cities.

CideRoad, NJ-based brand

that’s been key part of revival of colonial-era switchel bevs, will continue with deliberate growth strategy this

year, bringing in modest amount of new capital and making targeted tweaks to brand proposition. CideRoad is

playing in obscure segment that by now has attracted multiple RTD entrants, including NY rival Up Mountain,

based in Brooklyn, and brands from St Paul, Minn, and Mich. In addition, some cos reprising colonial drinking

vinegars called shrubs have been marketing switchel as one of their flavors.

CideRoad is in process of raising $1.5 mil in new capital from friends and family, founder Kevin Duffy told BBI

last week, to support broader retail footprint. Brand has made progress in cooperative grocery realm, winning

approval for all 3 of its sku’s this month at National Co-Op Grocers alliance and garnering entrée to Natl

Cooperative Grocers Assn as well, mainly for cold box. By mid-Feb, all UNFI and KeHe warehouses should be

opened up, Kevin said. Sprouts chain of natural food groceries will take brand chainwide in Mar/Apr timeframe

and Vitamin Cottage has taken it into all of its Nature’s Grocers stores. Whole Foods in Northern Calif and

Pacific NW is aboard, as is Bristol Farms chain in LA. In NYC, brand has moved on from small distributors

plying Korean green grocers to mix of UNFI, Associated Buyers and Abraham Natural. It’s assisted in efforts by

consultants Cascadia Managing Brands.

On branding front, label now segregates “Cide” and “Road” parts of brand name to clear up confusion among

some shoppers that it may be cider drink, while playing up “side road” connotations that are at heart of marketing

efforts. New labels carry more color, too. Core flavor dubbed Original is segueing to Original Maple & Ginger

because most consumers didn’t really know what switchel is in first place. (That may have explained, Kevin

theorized, why his Blueberry sku has been #1 at retail.) Taking issue head on, new tagline is, “What the heck is

switchel?” Co has received branding assistance from MetaBrand. It’s also upgraded Web presence and retained

Oberon Sinclair’s My Young Auntie pr shop to get word out. Sinclair’s best known for helping turn kale into

ingredient du jour for client American Kale Assn.

The Original Long Island Iced Tea, which dipped toe into tough NY market in 2011, is

ready to step up effort in 2016 after merging into publicly traded shell last year and recruiting advisory board of

familiar beer and bev names: John Carson, Dan Holland, Tom Cardella and Bump Williams. It’s well along in

private placement, enlisting DSD distributors for RTD iced tea line, on the lookout for modest acquisitions on NA

side and planning portfolio of alc bevs ranging from RTD cocktails to ciders and beer. By 2d half of year, co

hopes to have launched its first alc brands and be well along in national push behind NA tea.

Brand was created in 2011 by Phil Thomas, who brought street-level intimacy with bev biz by dint of having

worked Tropicana and vending routes. After testing brand proposition a coupla years, he revamped branding in

2014 and began process of merging into publicly traded shell co. That deal concluded last May so that co now

trades under LTEA moniker on OTC bulletin boards. Deal brought into mix small tranche of capital, potential for

acquisitions via currency of LTEA shares and key members of brain trust. One is Paul Vassilakos, whose Petrina

Advisors helps manage family office of Australian fashion magnate Eric Watson, whose Bendon Lingerie has

been allied with Elle Macpherson, Stella McCartney and Heidi Klum. (Watson has diverse range of other

interests, from ownership of New Zealand Warriors rugby team to grass-fed beef venture in Georgia.) Also

aboard is former Lion Nathan exec Julian Davidson, who’s helping plan alc-side portfolio with view to

replicating success he enjoyed building Independent Liquor New Zealand and selling it to Asahi. Co’s advisory

board will be familiar to those in bevs or beer in US: Dan Holland, former Haralambos Bev distribution vet who

segued over to supplier side at Activate, Nawgan and XXIV Karat wines; former Royal Crown chief John Carson,

now on banking/consulting side at Intercontinental Beverage Capital; recently retired beer exec Tom Cardella,

who most recently managed MillerCoors’ craft/import unit, Tenth & Blake, and former IRI and Nielsen exec

Bump Williams, now a consultant.

Thomas started with simple vision: find a way to monetize global recognition of “Long Island iced tea” as

cocktail recipe. In process he figured he’d tap into younger consumers migrating away from CSDs, and from

beer to premixed cocktails, while also appealing to retailers seeking more local, craft offerings at affordable

prices. He’d also have a vehicle with which to make targeted acquisitions that might yield some synergies, using

publicly traded co’s shares as currency.

He started on non-alc side, with iced tea that’s out in range of 13 flavors in 3 sizes, priced between AriZona and

Snapple and carrying vaguely nautical feel on label. Thanks to use of real-brewed, hotfill tea, non-GMO

certification and cane sugar as sweetener, it’s “premium product at an affordable price,” says Thomas. Diet

entries use sucralose to sweeten. Core entry is 20-oz PET bottle that moves via DSD distributors, goes out at 4

for $5 in grocers, promoted at 10 for $10, and at $1.49-2.49 up and down the street. That’s buttressed by 1 gal

jugs for groceries and 12-oz USDA-approved “minis” targeting schools via lower-calorie formulation that uses

monk fruit to get in at 60 calories. While past efforts by marketers to employ brand name with alcoholic

connotations have drawn controversy as way of acculturating kids to alc brands, Thomas said issue hasn’t

surfaced at all. To be careful, he named school-targeted mini “Long Beach Iced Tea,” conjuring up town on

Atlantic Coast near NYC.

So far tea is available mainly on eastern seaboard from Delaware north to New England, having landed such

chain accounts as Big Y, Stop & Shop, ShopRite, Duane Reade, Fairway and Best Market. DSD roster so far

includes likes of New England/Good-O in NY, buttressed by Elmhurst Dairy to service Rite Aid chain, as well as

Metro in Philadelphia, High Grade, Nash and Canada Dry Asbury Park in NJ, along with lotsa dairy operators.

Brand entered Fla about 6 months ago, via trio of small distributors, and is dipping toe in Midwest.

Gearing up for coming spring/summer, it recently brought aboard AriZona Iced Tea vet Joe Caramele as vp natl

sales & marketing for NA div, and is in process of private placement that would raise $4 per share, or $3 mil, to

support broadening of distribution and marketing and move into alc space. Co hasn’t been shy about undertaking

marketing efforts in past, announcing its presence in 2014 via billboard campaign in NY and last year running

promo with ESPN offering trip to Hawaii Bowl. It estimates that sales closed 2015 at $1.8 mil, up 50% from

2014.

Co’s public status originated with so-called special-purpose acquisition corp, or SPAC, with $552 mil in cash that

needed to be deployed within 2 years. After kicking lotsa tires, co eventually backed Long Island Iced Tea to

tune of $5 mil (with co netting $3 mil after expenses), returned the remaining $547 mil to investors. (With

additional money from outside investors, co has brought in $6.5 mil so far.) Merger into SPAC got brand its

public listing, tho Vassilakos said a key priority is to migrate to a national exchange so that institutional investors

are able to invest.

The Original Long Island Iced Tea, which dipped toe into tough NY market in 2011, is

ready to step up effort in 2016 after merging into publicly traded shell last year and recruiting advisory board of

familiar beer and bev names: John Carson, Dan Holland, Tom Cardella and Bump Williams. It’s well along in

private placement, enlisting DSD distributors for RTD iced tea line, on the lookout for modest acquisitions on NA

side and planning portfolio of alc bevs ranging from RTD cocktails to ciders and beer. By 2d half of year, co

hopes to have launched its first alc brands and be well along in national push behind NA tea.

Brand was created in 2011 by Phil Thomas, who brought street-level intimacy with bev biz by dint of having

worked Tropicana and vending routes. After testing brand proposition a coupla years, he revamped branding in

2014 and began process of merging into publicly traded shell co. That deal concluded last May so that co now

trades under LTEA moniker on OTC bulletin boards. Deal brought into mix small tranche of capital, potential for

acquisitions via currency of LTEA shares and key members of brain trust. One is Paul Vassilakos, whose Petrina

Advisors helps manage family office of Australian fashion magnate Eric Watson, whose Bendon Lingerie has

been allied with Elle Macpherson, Stella McCartney and Heidi Klum. (Watson has diverse range of other

interests, from ownership of New Zealand Warriors rugby team to grass-fed beef venture in Georgia.) Also

aboard is former Lion Nathan exec Julian Davidson, who’s helping plan alc-side portfolio with view to

replicating success he enjoyed building Independent Liquor New Zealand and selling it to Asahi. Co’s advisory

board will be familiar to those in bevs or beer in US: Dan Holland, former Haralambos Bev distribution vet who

segued over to supplier side at Activate, Nawgan and XXIV Karat wines; former Royal Crown chief John Carson,

now on banking/consulting side at Intercontinental Beverage Capital; recently retired beer exec Tom Cardella,

who most recently managed MillerCoors’ craft/import unit, Tenth & Blake, and former IRI and Nielsen exec

Bump Williams, now a consultant.

Thomas started with simple vision: find a way to monetize global recognition of “Long Island iced tea” as

cocktail recipe. In process he figured he’d tap into younger consumers migrating away from CSDs, and from

beer to premixed cocktails, while also appealing to retailers seeking more local, craft offerings at affordable

prices. He’d also have a vehicle with which to make targeted acquisitions that might yield some synergies, using

publicly traded co’s shares as currency.

He started on non-alc side, with iced tea that’s out in range of 13 flavors in 3 sizes, priced between AriZona and

Snapple and carrying vaguely nautical feel on label. Thanks to use of real-brewed, hotfill tea, non-GMO

certification and cane sugar as sweetener, it’s “premium product at an affordable price,” says Thomas. Diet

entries use sucralose to sweeten. Core entry is 20-oz PET bottle that moves via DSD distributors, goes out at 4

for $5 in grocers, promoted at 10 for $10, and at $1.49-2.49 up and down the street. That’s buttressed by 1 gal

jugs for groceries and 12-oz USDA-approved “minis” targeting schools via lower-calorie formulation that uses

monk fruit to get in at 60 calories. While past efforts by marketers to employ brand name with alcoholic

connotations have drawn controversy as way of acculturating kids to alc brands, Thomas said issue hasn’t

surfaced at all. To be careful, he named school-targeted mini “Long Beach Iced Tea,” conjuring up town on

Atlantic Coast near NYC.

So far tea is available mainly on eastern seaboard from Delaware north to New England, having landed such

chain accounts as Big Y, Stop & Shop, ShopRite, Duane Reade, Fairway and Best Market. DSD roster so far

includes likes of New England/Good-O in NY, buttressed by Elmhurst Dairy to service Rite Aid chain, as well as

Metro in Philadelphia, High Grade, Nash and Canada Dry Asbury Park in NJ, along with lotsa dairy operators.

Brand entered Fla about 6 months ago, via trio of small distributors, and is dipping toe in Midwest.

Gearing up for coming spring/summer, it recently brought aboard AriZona Iced Tea vet Joe Caramele as vp natl

sales & marketing for NA div, and is in process of private placement that would raise $4 per share, or $3 mil, to

support broadening of distribution and marketing and move into alc space. Co hasn’t been shy about undertaking

marketing efforts in past, announcing its presence in 2014 via billboard campaign in NY and last year running

promo with ESPN offering trip to Hawaii Bowl. It estimates that sales closed 2015 at $1.8 mil, up 50% from

2014.

Co’s public status originated with so-called special-purpose acquisition corp, or SPAC, with $552 mil in cash that

needed to be deployed within 2 years. After kicking lotsa tires, co eventually backed Long Island Iced Tea to

tune of $5 mil (with co netting $3 mil after expenses), returned the remaining $547 mil to investors. (With

additional money from outside investors, co has brought in $6.5 mil so far.) Merger into SPAC got brand its

public listing, tho Vassilakos said a key priority is to migrate to a national exchange so that institutional investors

are able to invest.

PepsiCo’s Naked Juice has quietly made its first foray into HPP realm with soft launch in recent weeks of Naked

Pressed subline, 12-oz entry priced aggressively at $4.99 SRP. Co has taken low-key approach so far, issuing no

announcements on launch, tho BBI editor spotted brand during recent visit to Berkeley Bowl natural grocer in

Bay Area. Line is packed in 12-oz straight-wall PET bottles and so far is available in 5 flavors, each sporting # of

ingredients in prominent numeral at label center: Bold Beet (7 juices: beer, carrot, cucumber, apple, lemon,

orange, ginger), Bright Greens (8 juices, led by apple, cucumber, celery), Cool Pineapple (3 juices), Lively Carrot

(5 juices), Hearty Greens (9 juices). The items contain unusually short ingredient list and carry no added sugar.

They’re Non GMO Project-verified. They’re getting to market via Naked’s own DSD system as well as

warehouse and broadliner partners, so far in major metros on West Coast from San Diego north to Seattle.

It’s being produced in facility within a facility in City of Industry, outside LA, with Pepsi going to unidentified

toller for HPP processing.

As with existing players like Suja, co seems to be working hard to source ingredients as close to plant as possible,

to get juices onto shelves ASAP. “We pride ourselves in sourcing the vast majority of our produce right here in

California whenever possible, and remaining ingredients from the native regions where they flourish and can be

sourced fresh,” Andrea Theodore, head of marketing for Naked Emerging Brands in Monrovia, Calif, told BBI in

emailed message. “We determine where we can find the highest-quality produce and source from those locations.

From the time we receive fresh produce, to cold-pressing, final processing and shipping the juice in bottles is

about 2 weeks.”

Dr Pepper Snapple

Group credited noncarb portfolio with most of growth co was able to eke out in its 4th qtr, displaying uncommon

degree of appreciation for contribution of allied brands Bai and Fiji. For Q4, net sales edged up 2.5% to $1.55

bil, but operating profit surged 26% to $322 mil. For full year, net sales rose 3% to $6.28 bil. Operating income

up mere 1% to $1.3 bil, weighed down by $7 mil impairment charge over Garden Cocktail veggie juice brand

sold in Canada.

In Q4 bottler case sales edged up 1% with CSDs flat and noncarbs up 4%. Overall, even with noncarb

contribution, US/Canada volume was flat with gains occurring in Mexico and Caribbean, thanks to brands like

surging Penafiel Mexican sparkling water brand (up 10% overall). Co said Schweppes rode sparkling water

and ginger ale boom, rising 7%, as did Canada Dry, up mid-single- digits. Squirt rose 3% and Crush

rose 4% but Dr Pepper trademark sagged 2% as diets and fountain biz both slipped. Still, that was

better than other cos’ diets, ceo Larry Young was quick to note. Biggest loser was 7 Up brand, off high

single digits despite hefty spend, and cfo Marty Ellen said co was seeking answers to get it on track

again. Among key noncarbs, bottled water category surged 21% on strength of Bai, Fiji and Aguafiel.

Snapple grew 4%, Hawaiian Punch 3%, Clamato 5% and Mott’s 2%.

Tho DPS brass emphasized that they outperformed CSD category as a whole, thanks to tilt toward flavors in

portfolio and milder declines in Diet Dr Pepper than rivals’ key diet brands, it effusively praised contributions of

brands like Snapple and Clamato, as well as allied brands Bai and Fiji Water. No mention today of Ten CSD

platform, over which co not so long ago pegged hopes of solving diet-soda conundrum, nor of Body Armor or

Neuro among allied brands.

On q&a, allied brands drew uncommon degree of interest from analysts, including from one, CLSA’s Caroline

Levy, who claimed to be drinking a Bai as she spoke. DPS mgmt was careful to emphasize those brands are still

small and, since they’re produced outside co, deliver smaller gross margin, though they’re a smart way to get

DPS into enticing “white space” in bevs. They’re an “important factor but not the largest factor in our growth –

nowhere near what a Penafiel or Canada Dry contributes,” said cfo Ellen, tho he declined to quantify their

contribution. Still, “the next level of breakthrough innovation may not come from inside the company but

passionate entrepreneurs who see the opportunities,” he said adding: “We choose these partners very carefully,

not just the brand, the product, but the strategy, management, their financial ability to perform as the brand

owner, to market the brand, sell in the brand at, say, the national account level, to get the authorizations . . . It’s

our way of saying, we’re going to go to where the consumer is going, not resist.”

On other topics, DPS execs said they’re gearing up capital investments to be able to play more in smaller package

sizes, which rivals Coke and Pepsi have adeptly used to increase price realization while assuaging consumers’

calorie concerns. They wouldn’t quantify how big that part of CSD biz is, except to say it’s very small. And ceo

Young evinced no desire whatsoever to follow Coke in refranchising any of bottling operations, saying that, aside

from some modest tweaking that’s sent some minor parts of biz to beer wholesalers here and there, co is very

happy with system it’s got. As for transition at Coke, thru whose system lotsa DPS volume moves, there have

been no glitches as territories have moved back into indie hands, Young vouched. “Those are our bottlers we’ve

really worked with a long time, so it’s been a smooth transition,” he said, referring to bottlers like Coca-Cola

Consolidated that have been reaping expanded franchise territories.