Coca Cola 3E, leader in the soft drinks market in Greece, is one of the multinationals participating in the Skrekas initiative for “locked” price reductions of 5% for a minimum of six months.
With 34 product codes, the company “wins” the “Permanent Price Reduction” sign on the shelves and refrigerators of supermarkets, but at the same time it has increased prices on 56 product codes. It is the second round of price hikes by Coca Cola 3E, a subsidiary of Coca Cola HBC, in seven months.
With the new price lists they have received since mid-October retail and wholesalers with effect from the end of October, three out of ten products have price increases, almost two out of ten reductions while prices remain unchanged at 50%.
Increases in popular categories
The new price lists, which are available to the mononewsreplaced the previous ones in force from 1the April 2023. Price lists that also had price increases – fire that in some popular product codes, such as Coca Cola and Coca Cola Zero, exceeded 30%. The weighted average increase in this round of company valuations was 8.2%.
In the second round, the average increases for the 56 codes including classic Coca Cola (Regular) and Coca Cola Zero, which hold leading market shares, are 7.6%. Indicatively, according to the new price list, the price of Coca Cola Regular in a glass bottle of 250 ml, in the package of 24 pieces has increased by 8.6% and of Coca Cola (PET) of 1 liter in a 3X2 package by 9.3%. Coca Cola Zero in the 250 ml glass bottle has also increased by 8.62%, while the increase in Coca Cola Zero (PET) 1.5 liter is lower, with the appreciation in the six bottles amounting to 4.04%. In Coca Cola with stevia in a 330ml can, the price increase amounts to 5.5%. The increases in Fanta are similar and in some cases larger. For example, Fanta orange in the 1.5 liter pet bottle and in a pack of six has an increase of 9.4% and Fanta Lemon in a 330 ml can and in the pack of 24 is more expensive by 9.37%.
Price reductions in two brands
The reductions in which it has progressed and will be maintained for a six-month period as provided for in the procedure for a company to participate in the “Permanent Price Reduction” measure concern 34 codes. It is for the Coca Cola Light and Schweppes brands and applies to all packaging and types of products. The average reductions in these codes are at 6.2%. However, in the last round of price hikes, both these categories of soft drinks were included in the list. For example, as reflected in the company’s price lists that came into effect last April, 500 PET 6X4 SCHWEPPES SODA WATER in a 500 ml Pet had increased in price by 7.9%, or in the 1.5 liter COCA COLA LIGHT Pet by 9.9% .
The prices remain stable in 90 products and major categories related to water, Amita and Frulite juices, energy drinks as well as teas and coffee.
The “fatigue” of mark-ups and promotions
However, after the jump in energy costs and the cost of raw materials that led the management of the parent company to change its pricing policy in the last two years, leading at the same time to a significant increase in profitability, as can be seen from the nine-month results announced on last week, the slowdown observed in some markets due to the limitation of consumer power due to the appreciations, leads to a readjustment of this strategy. Promotional actions are included in the plan where it is judged that there is this “fatigue” with the head of the company Zoran Bogdanovic, noted in a conference call with analysts that the market is approaching a critical crossroads. And this is because it is becoming apparent that inflation and the decline in economic activity in most countries are beginning to affect consumer spending, as he said.
As he said “from our side we are trying to react based on the climate that is forming and we are adjusting our strategy by expanding our promotions. So even in these conditions we managed for two consecutive quarters to have an increase in sales volume and at the same time we managed to have a positive image in all three of our main pillars». However, he added, “we know that in the future we need to pay more attention to keeping prices affordable. Which means that as we move forward, there will eventually be a greater balance in the development of the group and the price mix. As well as that we will give more space to the promotions concerning products that are in decline».
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