While the success of the soda tax could be doubtful at best, but Coca-Cola sees it as a threat to the soda industry. Gary Fayard, Coca-Cola's CFO said that the industry is an easy target, but they must pull together and work diligently, to fight against it.
Vending machine operators who wish to invest in a soda vending machine are possibly fighting a two-front battle. Clouds appear to be looming over the possible inclusion of nutritional labeling on vending machines. But, that change appears to be halted for the moment.
And the scope of the soda tax is somewhat ambiguous, because some state lawmakers see the tax simply as a way to gain additional tax revenue, while others see it as a downside.
Coca-Cola has been somewhat successful at fighting the soda tax. Collaborating with the American Beverage Association, the trade groups have worked to campaign against the soda tax; spending $5.4 million dollars in the first quarter for lobbying and advertisement efforts.
A recent analysis of the Coca-Cola Company finds that they continue to be strong, even after 100 or more years of operation. They have worked hard to stay competitive in the soda industry, going up against their main rival PepsiCo. Most of their recent success has dealt with their global presence, which Coca-Cola says is vital to maintaining their financial profile. And for the future of the soda industry, both Coca-Cola and PepsiCo are working towards making their operations efficient and more sustainable.
Overall, the soda tax is a threat because domestic suppliers will want to switch over to items like juices, or teas. They will reduce their costs associated with stocking beverage items, because the soda tax will increase the cost incurred at many levels, including distribution and supply.
And in response to the increased attention towards the health effects of full-calorie sweeteners, both PepsiCo and Coca-Cola are working to include newer, no-calorie alternatives into their products, such as stevia.
Most importantly, a price hike of soda does not equate to a sales drop. In the fall of 2008, Coca-Cola raised the prices of many products by 15 to 20%, and while they expected sales volume to drop, it held steady.
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