Channels of Distribution Article Review

Pepsi and Channels of Distribution

When a person thinks of beverage companies , two brands rise head and shoulders above the rest . They are , of course , Coca-Cola and Pepsi While both companies have worldwide channels of distribution to push their multi-billion dollar product , it would seem that Coca-Cola always had a leg up on Pepsi in the world marketplace . Pepsi , however , did make great strides in recent years catching up with Coca-Cola in terms of marketing distribution in a manner that did catch the Coca-Cola beverage company by surprise

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consider the distribution channels of a beverage company to be exclusively stores or shops where cans of bottles of soda can be purchased . Of course , this is an incredibly narrow view of the beverage industry as people purchase beverages from soda fountains in every restaurant on the face of the earth . If a company has a strong foothold in the realm of restaurant beverage distribution , then the beverage distributor will have a huge leg up on the competitor . Needless to say , the competitor who is on the short end of the stick in this scenario will invariably try to eek out a larger portion of the market

Sometimes , the principle and practice of formulating decent channels of distribution can yield a showdown between opposing companies in the same marketplace . Such was the case when Pepsi and Coca-Cola went head to head over what appeared to be Coke ‘s monopolization of the various distribution channels available through restaurants and other dispensing venues

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In the article , Pepsi Sues Coke in Antitrust Action Over Fountain Business ‘ a chronicle of Pepsi ‘s war to eek out a niche in the restaurant distribution channel is effectively presented

Basically , the article covers Pepsi ‘s antitrust lawsuit against Coke declaring that Coke had unfairly created a hold on the fountain dispensing market . The bulk of the argument presented towards Coke ‘s policies was briefed as follows

On day lawsuit d , Marineau writes Pepsi bottlers : 1 “90 of the top 100 national restaurant chains . currently receive delivery of all their products — including soft drinks — through foodservice distributors ” 2 “No one but Coca-Cola violates the basic rights of distributors to determine for themselves what they will carry ” 3 “We are not about to let Coke restrict the consumer ‘s right to choose (Anon . Beverage Digest

As such , Pepsi took legal action to cease Coca-Cola ‘s potentially unfair business practices

The article does point out that a major reason for Pepsi lagging behind in this area of distribution was the fact that Pepsi ‘s contracts with distributors were not at the same level of benefit as Coca Cola ‘s , so it was no surprise that Pepsi was rebuked often . In to reverse this Pepsi finally changed its long standing policies and developed a more attractive contract offering to those outlets that provide fountain soda

Also , Pepsi would go on to expand its purchases of restaurants and parent companies of restaurants in… [banner_entry_footer]