Strong competition in the beverage and soft drink supply chain is brewing with the decision to Pepsico and Orangina Schweppes to distribute its range of products jointly in the hospitality channel in Spain.
The union of the entire sales network of the brand of the “Happiness”, in search of process improvement and especially of channel unification and reduction of distribution costs, it seems that it has found the reaction of Americans and Japanese.
Pepsico they keep their American past, but Orangina Schweppes, It currently belongs to the Nipon Suntori group.
Improving the positioning of its brands in bars and cafes seems to be the corporate objective of this joint venture, not in vain the grouping of brands in a single distribution channel completes a very interesting portfolio for the hotelier with a single intermediary, and surpassing the Atlanta company (USA) in range.
The signs of Pepsi, Kas, Gatorade and Tropicana, that contribute Pepsico, will join TriNa, La Casera and Sunny Delight de Orangina Schweppes in the range of beverages, obtaining a significant share of fruit drinks and, above all, a very interesting penetration in terms of the culture of traditional Spanish brands that the consumer will surely welcome, since lately they had been in the background.
Apart from drinks, a line of products will come into play, in this case food, championed by brands Lay’s and Matutano, that with the complement of the products of Alvalle they will complement the distribution catalog to the new alliance created.
A tough entry barrier for any competitor that may be forced to enter the food channel for the hotel and catering industry in order to stop the strong implantation that the recently united Americo-Nipponese are seeking.
They are two historical rivals of the company Atlanta that surely have valued and evaluated this action very well, and the moment of communicating it has also been very successful, taking advantage of the fact that the company resulting from the union of bottlers Coca Cola Iberian Partners, is in full judicial process for the employment regulation file that it presented as a result of the Merger, and that was recently declared void by the Social Chamber of the National Court, and it will now be the Supreme Court that will shortly decide on the appeal presented.
The agreement between the two sugary beverage companies is a replica of the models already applied by both in countries such as France, Poland, Japan, Vietnam and New Zealand, with different results in each place …
All the rights to distribute the products will be on the hospitality channel but only on the peninsula, leaving the Canary Islands and Balearic Islands, with its differentiated networks as today.
The alliance will not take place at the moment in the retail distribution channels, department stores, retail and food chains.
Now it only remains to see how they complete the union and how they develop their processes to assess whether it has been productive, not only for them but also for the clients …
What remains to come for sure, will be a commercial reaction of “the spark of life”
We’ll be there so much…