Dive Brief:
- Coca-Cola will sell bottling operations in Illinois and Florida, just four years after the company bought its North American bottling operations.
- In Chicago, Coke will now be bottled by Reyes Holdings, which already dominates beverage bottling and distribution in the region. In Florida, Coke will hand the reins to Troy Taylor. Terms of the deals were not released.
- The transactions were expected. Coke has made no secret of its plans to restore "the system," return to a franchise model for bottling, and retreat from the central-control model of recent years.
Dive Insight:
As we suggested above, the deals in Chicago and Florida were not a surprise. In fact, it's sort of surprising just how unsurprising all of this is.
First, Coca-Cola has been talking about returning to an independent bottler system almost since it dumped that system just a few years ago. Second, the soft-drink giant seemed to make a point of letting investors know that bottling deals would be announced at an industry conference on Friday, which is exactly what happened. And third, Coke wound up signing a deal with Reyes — the global bottling powerhouse. There really couldn't have been a more obvious choice.
Our guess is that Coca-Cola's goal here isn't just to return to a franchise model — it's to return to a franchise model in as gentle, smooth, noncontroversial, and trouble-free a manner as is possible.
