Blog: Soft drinks firms face hard choices
Olly Wehring | 8 March 2006
Who’d be a CSD CEO this month? It’s not been easy of late for the carbonated soft drinks companies of the world, but those operating here in the UK are having a rare old time in March.
In spite of trying to make a half empty glass look half full, Britvic last week pointed to the first two months of this year as evidence that soft drinks are struggling in the country.
“Since Christmas, there has been a weakening in the total soft drinks market in the UK,” the company said. “If the soft drinks market shows recovery over the balance of the year as we anticipate, we remain confident of delivering earnings within market expectations, albeit at the lower end.”
Looks like a big if, if the start of 2006 is anything to go by - Britvic also noted that, for the 12 weeks to 25 December, revenue was up by only 1% and operating profit pre-exceptionals rose by 5% compared to the same period last year.
Add to this the recent testing in the country of soft drinks for the cancer-causing chemical benzene, and the alarm bells just get louder.
The Food Standards Agency has been testing 230 soft drinks available in the UK, and found benzene levels of up to eight parts per billion in some brands, eight times the level permitted in drinking water. Naturally, some of the UK press had a field day, in spite of the FSA noting that the levels of benzene were very low and not a concern for public health. Indeed, the British Soft Drinks Association highlighted the comments, adding that there was nothing to worry about.
But something still worries me. Here in the UK, a legal limit has been set for the amount of benzene found in drinking water, but no legal limit exists for the amount of benzene in soft drinks. Oh, and the word ‘cancer’ is in the news stories.
This one needs handling with kid gloves, otherwise the CSD market will turn yet more unpalatable than it currently is.
Whisk(e)y companies spend a lot of money and effort ageing their products for that premium taste....
PepsiCo created a stir last week with the news it is testing a product called Caleb's Kola, with some in the media claiming it was the beginning of a new “craft soda” category....
SABMiller's bid to widen the appeal of beer is very much in evidence at its latest 'House of Peroni' - with beer cocktails and a bigger bottle for the Italian lager brand on offer. ...
Here's a round-up of the big stories on just-drinks last week, featuring PepsiCo, SABMiller, the Scotch whisky category and the US wine market....
- Analysis - Remy's Cognac "dead-cat bounce"
- Comment - How Hand-Made is Tito's Handmade Vodka?
- Heineken to stay "active player" in beer M&A - CFO
- Diageo's future brighter than present suggests
- Diageo's Q1 Results by Region
- Moët Hennessy unveils first Travel Retail outlet
- United Spirits sees Q1 net loss
- Beam Suntory, Edrington part ways in Travel Retail
- Diageo puts Beckham centre stage in Haig Club ad
- Smirnoff Ice gets India launch