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ST. LOUIS – Excel Bottling Co. has been known for more than 80 years for its cane sugar soft drinks, but in the last five years the soft drink has become less and less important.
Increasingly, the Breese Beverage Company, based in Illinois, which originated from popular brands such as Ski and Lucky Club Cola, has turned to other beverages such as beer, teas and water. flavored.
"I look at my own habits and those of my kids and we really drink more sparkling water than five years ago," said Bill Meier, general manager and owner of Excel. "Five years ago, we were producing 100% soda, and I can clearly imagine a scenario in the next five years where 50% of what we produce is soda, but the other half is made up of products. alternative. "
Beverage companies from all walks of life – from global conglomerates to small businesses – are diversifying their portfolios.
"What's happening to companies in the beverage category is that consumers are moving away from those soft drinks that are not particularly healthy and are looking for healthier alternatives," said Terry McDaniel, CEO of Ronnoco Coffee, based in St. Louis. "So we see all these new entries in the category because everyone is trying to catch this wave.Also the big drink companies are trying to buy their way into the category."
Look no further than the battle between rival soda makers Coca-Cola and Pepsi.
Over the past 30 days, Coca-Cola, under separate deals, has agreed to buy the largest UK coffee chain, Costa, for $ 5.1 billion and has taken a minority stake in BodyArmor.
"Hot beverages are one of the few segments of the beverage market where Coca-Cola does not have a global brand and Costa gives them access to this market through a strong coffee platform," said Maxine Vogt. analyst at Euromonitor.
Pepsi's parent company PepsiCo, which also owns the 7Up and Aquafina brands, bought SodaStream, which allows consumers to make carbonated soft drinks at home for $ 3.2 billion. .
Even Anheuser-Busch InBev is expanding its offering and now offers ready-to-drink iced tea and organic sparkling water containing caffeine with brands such as Hiball and Alta Palla.
And Anheuser-Busch has long been interested in expanding into the non-alcoholic beer business, which is gaining momentum. The company even created a new non-alcoholic beverage manager this summer to develop the segment, which now accounts for about 10% of its volume, a figure that could double over the next decade.
As large companies enter the market with new products or acquisitions, the pressure is on others to produce their own beverages.
Ronnoco, headquartered in St. Louis since 1904, has increasingly focused on developing new product lines to complement its traditional coffee and tea offerings.
During the summer, Ronnoco introduced new lemonades infused with flavors, sweet teas and cold-brewed coffees. This fall, the company will release new fair coffees infused with vitamins.
"We are fortunate that coffee and tea, the two most important parts of our business, are already considered healthy," said McDaniel. "But the variations of this health are really what we want to capitalize on (and) … the new products are essential to growth and success."
Rising research and development is also expanding the traditional beverage aisle in local grocery stores.
As customers demand more variety in the sparkling and flavored water category, Schnucks has expanded this space in the aisle to add assortments, said Schnuck Markets Store Manager Pam Hild.
Hild said that customers looking for "better for you" options like sparkling or scented water, an even greater variety is probably going on at grocers across the country.
"We will continue to develop our assortment and look for new partnership opportunities with our suppliers to bring the best value to our customers," she said.
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