I was getting an oil change at Wal-Mart and waiting in the waiting room when I saw a vending machine selling Wal-Mart/Cott Cola for only $25 cents a can. I couldn't resist the price, so I bought two cans and it tasted OK. I think this could be trouble for Coke. Cott also makes the "Sam's American Choice" cola you see at Wal-Mart these days. Getting a contract with Wal-Mart has given Cott a big boost. Cott doesn't sell any cola under the "Cott" name but produces generic cola for big retail chains like Wal-Mart. What's more, if you visit Cott's site at www.cott.com, Cott is already selling its generic cola throughout all the emerging markets, so there's a chance Cott could gain a foothold in those markets before the the Coca-Cola brand-name magic and loyalty have a chance to establish themselves in these important future markets. To add insult to injury, Cott uses white, script, Coca-Cola-like lettering for their company name against a Coca-Cola red background. Go to www.cott.com and see for yourself. But again, Cott doesn't sell any cola under the "Cott" name but only through retailers like Wal-Mart. I don't know what impact, if any, Cott will have on Coke throughout the world, but if Coke has any Achilles' heel, it is the price threat posed by discounters like Cott.
Here in California, the grocery store chain Safeway sells these Cott sodas under the name "Safeway Select." The cola is sold in a familiar red-and-white can for some dirt cheap price. Personally, I wouldn't worry about these store brands. First of all, Cott is just barely profitable. They aren't making a killing with this business. Think about it. They have absolutely no pricing power. By virtue of their store brand status, these sodas HAVE to be priced significantly lower than Coke. At the same time, the costs of manufacturing these sodas is probably at least equal to the costs of manufacturing Coke. In fact, Cott's costs might even be higher because Coke takes advantage of economies of scale. The upshot of all this is that a little strategic pricing by Coke (i.e., 12-pack specials) might force the store brands into the position of actually losing money.
Every month the stuff is on sale priced at $2.99 pre case. But I thought SWY manufactured it's own soda. Does Cott like make some and then SWY manufacture the rest itself? SWY does a lot of buy-one-get-one-free in Coke-Pepsi-7UP products. This week the Pepsi products 12PK are buy one get one free, the Coke 12pk is $2.79 until August 2nd, and the SWY SELECT case 24pk is $2.99 a case mix or match flavors. And the 7UP product 6pks are buy-one-get-one-free through August 2nd. All prices with Safeway Club Card. All the soda is on sale there . Soda has a high pm, very high. Also, I am talking the NorCal/WesternNev division of SWY.
Cott doesn't sell its cola under its own name in the U.S. but does use its own name in Canada and, I imagine, other markets worldwide. It is probably using the Coca-Cola-like script lettering for "Cott" in those worldwide markets as well.