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Coca-Cola to sell smaller bottles at higher prices in response to sugar tax

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Coca-Cola is to launch smaller bottles and raise prices as the United Kingdom’s sugar tax comes into force.

The company has chosen to offset costs and reduce package sizes rather than alter its famous recipe.

Coca-Cola Classic contains 10.6g of sugar per 100ml.

The changes, which will happen in March, just before the sugar tax arrives in April, mean a 1.75 litre bottle will shrink to 1.5 litres; the price will increase by 20p. A 500ml bottle, meanwhile, will stay 500ml, but will shift from £1.09 to £1.25.

“We have no plans to change the recipe of Coca-Cola Classic so it will be impacted by the government’s soft drinks tax,” said a spokesman for Coca-Cola European Partners, which is the bottler for Coca-Cola products in western Europe. “People love the taste … and have told us not to change.”

The sugar tax – designed to help combat child obesity – was announced by then chancellor George Osborne in 2016 and he gave drinks-makers time to change their recipes if they wished to escape the levy. From April soft drinks manufacturers will be taxed at 18p per litre on drinks containing 5g of sugar or more per 100ml, or 24p per litre if the drink has 8g of sugar or more per 100ml. The tax will apply to one in five drinks sold in the UK.

Coca-Cola said it was in discussions with retailers about the impact of the soft drinks tax on Coca-Cola Classic. “These discussions include reviewing the pack sizes offered to consumers and our approach to price-marked packs,” a spokesman added.

While the soft drinks giant has been willing to change the ingredients of other drinks in its portfolio, including Sprite, Fanta and Dr Pepper, its reluctance to tamper with Coca-Cola is understandable.

One of the darkest hours in the Coca-Cola company’s 125-year history came in 1985 when it changed its famous secret recipe. What was billed as “new Coke” was a marketing disaster, sparking a huge consumer backlash that forced the company to revert to the original taste 79 days later.

While the thinking behind the sugar tax has generally been well received by consumers, they have found some drinks harder to swallow minus the sugar. According to industry data sales of Lucozade, owned by Japanese drinks group Lucozade Ribena Suntory, slumped 4% last year as some drinkers complained about the taste.

About Charles Igbinidu

Charles Igbinidu is a Public Relations practitioner in Lagos, Nigeria

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