Wendy's Ditches Pepsi for Exclusive Coke Deal

Wendy's, the hamburger chain, has agreed to serve Coca-Cola exclusively for the next decade, ending its deal with Pepsi. The decision marks a significant shift in the soft drink market, where Coca-Cola dominates with a 65% share. The agreement will affect around 700 to 800 franchises currently under contract with Pepsi distributors. Coca-Cola will invest $42 million in Wendy's national advertising in the first year.

Key Takeaways:

• Wendy's will serve Coca-Cola exclusively for the next decade, ending its deal with Pepsi.
• The agreement affects around 700 to 800 franchises currently under contract with Pepsi distributors.
• Coca-Cola will invest $42 million in Wendy's national advertising in the first year.
• The switch to Coca-Cola will take place within two years, with all Wendy's restaurants serving the soft drink by then.
• The decision marks a significant shift in the soft drink market, where Coca-Cola dominates with a 65% share.
• Pepsi executives were not invited to bid on the deal, but the company's spokesman said they are preparing an offer that will exceed Coca-Cola's terms.
• Pepsi has attempted to crack Coca-Cola's dominance in the restaurant market, filing an antitrust lawsuit against them in federal court in New York.
• The lawsuit claims Coca-Cola's contracts with independent distributors are unfair because they prohibit the distributor from handling Pepsi products.

Statistics:

• 85% of Wendy's restaurants in the United States already serve Coca-Cola products.
• 25% of the U.S. soft-drink industry's volume is accounted for by fountain drinks.
• 65% of the restaurant market is controlled by Coca-Cola.
• $42 million: the amount Coca-Cola will invest in Wendy's national advertising in the first year.
• 700-800: the number of franchises affected by the switch from Pepsi to Coca-Cola.

Sources:

• Associated Press
• Beverage Marketing Corp
• PepsiCo Inc.
• Coca-Cola Co.