RompelStompel
Senior Member
http://www.fin24.co.za/articles/default/display_article.aspx?Nav=ns&ArticleID=1518-1786_2071637
Johannesburg - ABI, South Africa's main bottler of fizzy and other drinks, confirmed that the prices of soft drinks will increase by an average of 4.5% on February 26.
The price increase will presumably be passed on to the consumer.
ABI accounts for about 60% of Coca-Cola sales in South Africa.
In response to enquiries, ABI communications chief Michael Farr told Fin24's sister publication Sake that the price increase will depend on the packaging and the product series.
According to a letter from ABI to its customers, the Coca-Cola company and ABI want to ensure that their products remain accessible and affordable for most people.
"We regret that several local factors have made price increases for some products inevitable this year," the letter states.
However, the companies believe that the approximately 4.5% price increase is still below the projected inflation rate (CPIX) for 2007 of between 5% and 5.5%.
"We also expect that it will be lower than the price increases from other beverage manufacturers."
Farr says that prices will increase because of increases in wages and salaries, as well as the cost of raw materials, such as sugar, carbon dioxide, bottle tops, aluminium cans and glass.
He also says that prices should only increase once a year.
This increase will be bad news for shopkeepers, who now have to push their prices up or be satisfied with narrower profit margins.
It's also bad news for the consumer, who was inconvenienced in December when certain soft drinks were unobtainable, owing to the countrywide shortage of carbon dioxide suitable for human consumption.
At the end of last year, the suppliers of gas to ABI were unable to provide the usual amount of carbon dioxide due to maintenance work.
The shortage of carbon dioxide at the time resulted in ABI, SA Breweries' soft drink bottling subsidiary, at one stage being able to meet less than 50% of its customers' demands for fizzy drinks.
Farr says that the price increases aren't being taken lightly, but are being tackled "conservatively", with few and carefully considered adjustments.
Johannesburg - ABI, South Africa's main bottler of fizzy and other drinks, confirmed that the prices of soft drinks will increase by an average of 4.5% on February 26.
The price increase will presumably be passed on to the consumer.
ABI accounts for about 60% of Coca-Cola sales in South Africa.
In response to enquiries, ABI communications chief Michael Farr told Fin24's sister publication Sake that the price increase will depend on the packaging and the product series.
According to a letter from ABI to its customers, the Coca-Cola company and ABI want to ensure that their products remain accessible and affordable for most people.
"We regret that several local factors have made price increases for some products inevitable this year," the letter states.
However, the companies believe that the approximately 4.5% price increase is still below the projected inflation rate (CPIX) for 2007 of between 5% and 5.5%.
"We also expect that it will be lower than the price increases from other beverage manufacturers."
Farr says that prices will increase because of increases in wages and salaries, as well as the cost of raw materials, such as sugar, carbon dioxide, bottle tops, aluminium cans and glass.
He also says that prices should only increase once a year.
This increase will be bad news for shopkeepers, who now have to push their prices up or be satisfied with narrower profit margins.
It's also bad news for the consumer, who was inconvenienced in December when certain soft drinks were unobtainable, owing to the countrywide shortage of carbon dioxide suitable for human consumption.
At the end of last year, the suppliers of gas to ABI were unable to provide the usual amount of carbon dioxide due to maintenance work.
The shortage of carbon dioxide at the time resulted in ABI, SA Breweries' soft drink bottling subsidiary, at one stage being able to meet less than 50% of its customers' demands for fizzy drinks.
Farr says that the price increases aren't being taken lightly, but are being tackled "conservatively", with few and carefully considered adjustments.
