"Can't I buy Coca Cola with Zhao Yiming's snacks in the future?" Li Qiyuan, a consumer in Henan, recently saw a message online about Zhao Yiming's snacks being taken down from Coca Cola and asked this question. Last year, Zhao Yiming opened a snack shop on the street where Li Qiyuan's house is located. Her favorite thing is to buy various water drinks inside - usually 500ml Coca Cola, which is priced at 3 yuan in a small store, often costs just over 2 yuan here.
Recently, a notice circulating online showed that Zhao Yiming's snacks and snacks will stop selling 500ml of Coca Cola and Sprite due to the manufacturer's request for price increases. After the existing inventory is sold out, the Coca Cola/Sprite and Coca Cola bottled products of this specification will be fully taken off the shelves.
But this statement has been denied by Zhao Yiming's snack side. On July 2nd, Zhao Yiming Snacks responded to Interface News on this matter by saying, "The relevant products are selling normally in all Zhao Yiming Snacks stores and have not been affected yet."
This incident is to some extent a continuation of previous rumors of Coca Cola's price increase.
In May, media reported that Coca Cola products in Hebei, Henan, Shandong and other regions began to increase in price. Among them, 888ml Coca Cola, Sprite, and Fanta were adjusted to 5 yuan, and 2-liter PET bottle products were adjusted to 7 yuan.
During the visit to Interface News at that time, it was learned from some dealers in the aforementioned regions that there was indeed a price adjustment in this round. Among them, 8-bottle 2-liter Coca Cola, with the latest price adjustment, has a box purchase price of about 44-45 yuan, a price increase of about 3-4 yuan, and a single bottle purchase price increase of about 50 cents. The 888ml Coca Cola, Sprite, and Fanta have all increased along with it.
In the past two years, there have been frequent reports of price increases for Coca Cola.
In April, several price increase letters for Coca Cola's beverage products were also circulating online, covering most of its products, including 300ml, 500/600ml, 888ml soda, as well as queer and juice. The relevant letters all provided suggestions for retail terminal price increases. However, the above news has not been responded to or confirmed by Coca Cola.
In May 2023, multiple media outlets also reported that Coca Cola had raised prices to varying degrees across multiple terminals in various parts of the country. Relevant media reports mentioned that the increase reached 2.9% -11.4%, which is known as another price increase since entering the "3.5 yuan era" in 2022.
The rising costs of raw materials, supply chain, packaging materials, and labor are important reasons for the price increase of beverages. Taking sugar as an example, since the second half of 2023, commodity prices have continued to rise, especially for sugar, which accounts for a high proportion of raw material costs in the beverage industry, with prices hitting new highs.
Under cost pressure, multiple beverage companies have seen significant profit compression.
From 2021 to 2023, the net profit margin of the unified central control beverage business decreased from 13.9% to 10.9%, a decrease of 3 percentage points. The financial report indicates that the food and beverage industry will face fluctuations in related raw material prices in 2023; The net profit margin of Kangshifu's beverage business has dropped from 35.94% to 31.95% from 2020 to 2022. Although it has reversed to 32.1% in 2023, it is only a slight increase of 0.15% compared to the previous year.
However, for the beverage industry, due to the high sensitivity of retail end consumers to prices, price increases are mostly targeted at changes in factory prices and may not necessarily be directly reflected on supermarket shelves.
Taking Coca Cola as an example, in previous visits to Interface News, it was observed that the price changes of Coca Cola on the terminal were not significant. In May this year, the price of Coca Cola on the shelves did not increase with changes in purchase prices. The prices of Coca Cola on e-commerce platforms, offline catering, and supermarkets are not uniformly priced by individual merchants, and the price range is also large, so consumers still have room for choice.
As of July now, according to some offline supermarkets in Shanghai, the price of 500ml Coca Cola is concentrated at 3.5 yuan, while the price range of Coca Cola on online platforms such as Meituan is around 3-4 yuan, and there has been no significant increase overall.
"The pressure is more transmitted to the channel link," Ren Yunzhi, Vice President of FMCG offline retail monitoring agency, told Interface News.
Ren Yunzhi stated that in order to avoid a situation where retail products increase in large quantities, brands and distributors may also adjust and respond through various means. One is that dealers actively compress profit margins, and the other is that brands alleviate dealer pressure through various means such as adjusting display costs.
This was also confirmed in previous visits to Interface News. Some dealers have stated that the price increase regulations do not have mandatory requirements for terminal retail prices.
Returning to the relationship between Zhao Yiming's equal quantity snack shops and Coca Cola, the price advantage of snack shops mainly stems from the shortening of the supply chain caused by this business model. By reducing the number of distributors and agents in the middle, they can obtain relatively low-priced products.
Branded snacks like Coca Cola are usually a popular product in snack stores, and the reason why they are lower than the common retail price is often due to self advertising by the stores, which attracts a large number of consumers to purchase.
In view of this, the increase in factory prices may also put pressure on mass stores, but as a classic beverage, Coca Cola's star effect cannot be ignored. How to balance these two points is also a test.