Efficient Packaging and new Formulation Help Coca Cola Grow Despite new Regulation

okeOver the past several years the soda lobby has spent millions of dollars to stop the new soda tax (aka, “sugar tax”) which has incrementally increased the cost of sugar-laden products. Unfortunately for the soda companies the law still passed through Congress.

But while this is tough for both the soda companies and for consumers (in terms of retail price), the end result should help to reduce overall sugar consumption in the United States. That is definitely something that, it seems, everyone should be able to rally around.

However, Coca-Cola has figure out how to make this work for them and, rather than taking a loss from reduced profits, the company has found a way to improve sales despite the restrictions.

Indeed, the soda company reported, today, that third quarter 2016 operating results are better than what analysts expected. “I am pleased to report that we delivered results in line with our expectations,” explains The Coca-Cola Company Chairman and Chief Executive Officer Muhtar Kent. “We continued to see solid revenue results in our developed markets with 2% unit case volume growth and a continued focus on price realization. The United States, Japan and Western Europe delivered standout performance underpinned by innovation and world-class marketing. Globally, we gained nonalcoholic ready-to-drink value share for the 37th consecutive quarter and are on track to deliver our financial commitments for the full year.”

He goes on to say that the company is taking a more aggressive approach to evolve products and strategies to expand the brand portfolio in order to more effectively address the changing preferences of consumers, today.

In addition Coke president and COO James Quincey comments that they are consuemrs want less sugar in their products, as well as more choice in both beverage variety and in package sizes. He also notes, more specifically, that they will focus on specific expansion of low- and no-calorie products and are reformulating products to reduce the count of added sugars.

Quincey also comments that they can accomplish this expansion even amid the new restrictions: “We can grow while reducing sugar consumption… We currently have over 200 reformulation initiatives to reduce added sugar.”

“While our year-to-date reported net revenues declined 5%, our core business organic revenues* have grown 4% despite continued global economic and political volatility. We believe this core business reflects the ultimate destination of our transformed company – an enterprise positioned to capture sustainable growth through a laser focus on innovating across our portfolio, building strong brands, and leveraging unparalleled customer service through aligned bottlers. As we continue on our path to transform the global system, we remain committed to our strategic actions for growth that will create long-term shareowner and stakeholder value.”

 

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