Thursday, March 08, 2007

Soft drinks drying up

The sales chart arrow is pointing in the wrong direction for the U.S. soft drinks industry.

Beverage Digest, a major industry publiciation, said today that the sales volume declined 0.6% in 2006 following a 0.2% decline in 2005. That's based on sales of 10.16 billion cases of soft drinks in 2006, down from 10.22 billion in 2005.

An increase in consumer demand for bottled water and healthier drinks in general is blamed, or credited, with the decline. However, in flavored soft drinks Pepsi's Mountain Dew rose 1%, Cadbury's Dr. Pepper 1.7% and Coke's Fanta 7%.

Energy drink makers Hansen Natural Corp., Rockstar and Red Bull saw their sales volumes soar, with Hansen up 68%, Rockstar up 65% and Red Bull up 27%.

“The carbonated soft drink industry has moved from roughly 3 percent growth in the 1990s to modest declines in the last two years,” Beverage Digest reported, saying the estimate included energy drinks, a very fast-growing segment. “Beverage Digest estimates that if energy drinks were excluded, the category would be down by about 1.5 percent.” the report said.

U.S. drinks makers Coca-Cola Co. and PepsiCo Inc. posted U.S. volume declines of 1.2% and 1.3%, respectively, while UK company Cadbury Schweppes Plc saw its volume rise 1.3%, according to Beverage Digest.

Volume of Coke Classic fell 2% to 1.76 billion cases while Pepsi-Cola's fell 2.5% to 1.11 billion cases, Beverage Digest said. Sales volumes of Diet Coke and Diet Pepsi also fell slightly. The top three brands by market share are Coke Classic, Pepsi Cola and Diet Coke.

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