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Black Market Mexican Coca-Cola

01/11/06 @ 11:15:00 am, by Kate Hopkins Email 3228 views • Categories: Beverages

Dr. Vino e-mailed me this news story that I love, if only because it validates my own opinion on the taste of American Coca-Cola and the cluelessness of the Coca-Cola Executives. From the article:

Coke from south of the border is a big business, fueled by the Hispanic population, the fastest growing minority group in the U.S., and soda connoisseurs drawn to its taste and the old-time look of the iconic bottle. Fans insist the Mexican cola, made with cane sugar, has a better "mouth feel" than the U.S. formula. U.S. bottlers switched from cane sugar to high-fructose corn syrup in the 1980s to cut costs.

What's particularly galling is the extent in which Coca-Cola will go in order to prevent Americans from being regularly supplied with cane sugar Coke, even though the importation of the soda isn't illegal. Mart Martin, a Coke spokesman, says that this practice "infringes on Coke's trademark and on local bottlers' authorized territories", although I'm not exactly sure on how a Coke product made in Mexico infringes one a Coke product made in the U.S.

The best paragraph in the piece?

"Coke is sending lawyers to harass people instead of catering to customer demand," said Danny Ginsburg, founder of Real Soda in Real Bottles, a Los Angeles company that sells hard-to-find drinks.

There's so much truth in that, that it's kind of startling to see it in print. The arrogance of Coca-Cola has always been a little awe inspiring. Of course, it's easy to be arrogant when you're an oligopoly.

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Comments, Pingbacks:

Comment from: cybele [Visitor] · http://www.candyblog.net
I've heard that Coke makes a "Passover Coke" that is made with real sugar. I've never put it to the taste test:

http://www.npr.org/templates/story/story.php?storyId=1832301

I also have quite a few friends who do make quite an effort to get the Mexican Coke when they can because they can tell the difference.

Of course the big "conspiracy" that's been circulated is that Coke made "new coke" as a way of substituting corn syrup and always planned to reintroduce "classic coke" with the new formulation.
PermalinkPermalink 01/11/06 @ 13:31
Comment from: Leah [Visitor]
It is true--there is Passover Coke available in urban areas with large jewish populations. It was something I learned about last year and was even advised to stock up on the Passover treat.

(It is for Jews who avoid corn products in addition to the ban on leavened breads during passover.)
PermalinkPermalink 01/11/06 @ 14:05
Comment from: Jack [Member] Email · http://www.ForkandBottle.com
Mexican coke is widely available here, as we have so many Tacquerias locally.

Mexican Coke = Good Coke
American Coke = Bad, Fat Coke

What's funny too, is that do they really need to cut their costs be using HFCS? Soft drinks are super profitable. (Does a soft drink selling for $1.50 have even 10 cents in actual costs - self-served?)
PermalinkPermalink 01/11/06 @ 14:07
Comment from: Kate Hopkins [Member] Email · http://www.accidentalhedonist.com
Some quick numbers, on why Coke would use HFCS over sugar.

Annual US Per capita consumption of Coke in servings: 411

People in the United States: 297,890,000

Servings of Coke in the US, per year: 122,432,790,000

How much a 5 cent cost increase in sweetner, per serving, would affect the bottom line: $6,121,639,500

How much a penny cost increase in sweetner, per serving, would cost Coca-Cola:
$1,224,327,900

Pretty much sums it up right there.
PermalinkPermalink 01/11/06 @ 14:36
Comment from: Dr. Vino [Visitor] · http://drvino.blogspot.com
I'm surprised neither you nor the Journal had the headline "Mexican Coke mules"...Yoink.

In vino,
PermalinkPermalink 01/11/06 @ 18:13
Comment from: chzplz [Visitor]
don't forget Canadian coke... no HDCS tax credits here means we still use cane sugar in most of our sodas...
PermalinkPermalink 01/11/06 @ 20:29
Comment from: ann [Visitor]
not only do i vastly prefer mexican coca-cola, but i find their cigarettes taste more like, well, tobacco than american ones do
i was in cozumel and was almost bowled over by how much a marlboro i smoked tasted like a fine cigar, as opposed to a kitty litter box
PermalinkPermalink 01/12/06 @ 05:29
Comment from: Kathryn [Visitor] · http://kosmonaut.blogspot.com
Mexican coke is way better with rum and cokes. :)
PermalinkPermalink 01/12/06 @ 09:22
Comment from: Nicholas Caratzas [Visitor]
How much a penny cost increase in sweetner, per serving, would cost Coca-Cola:
$1,224,327,900


You got it. In the thread above I get a savings of about 1 1/2 cents/12 oz serving, which translates to about $1.8 Billion/year.

In a strict business sense, I think it's the bottlers who realize the direct savings.* This adds a layer of difficulty that wouldn't be there if Coke did all its own bottling.

It's pressure from the bottlers to protect their franchise that's resulting in visits from lawyers. I'm by no means a fan, but Coke management has a hard job here; they have to keep their customers (the bottlers) happy while knowing there's a (consumer) demand for a slightly different but competing product driven by demands that could be incredibly costly or impossible to implement domestically (heavy glass bottles, cane sugar, nostalgia, emigrant homesickness.)

The article mentions that there's a test program authorizing distribution of Mexican Coke in limited quantities. Though that sounds like a no-brainer, it's a non-trivial problem for Coca-Cola to do this without getting the bottlers upset. If they try to place mexi-Coke as a premium product, it dilutes the value of the rest of the brand. Selling it as Mexican Coke and in select areas is one way of minimizing bottler griping. Apart from Corona and some varieties of liquor, it's rare for products originating south of the border to be seen as upmarket by most Americans.

*When I used to work in the soda biz 20 years ago we'd ship pails of concentrate to the bottlers, who'd then mix in sweetner to make syrup before bottling. Of course, Coca-Cola ultimately receives some benefit by being able to charge higer licensing fees/concentrate fees/advertising fees to the bottlers.

PermalinkPermalink 01/14/06 @ 12:27
Comment from: Tasted All I Know What Is Best [Visitor]
How much is the cost per sweetener if people just stop buying the crap in cans & plastic and switch to Mexican Coke? At the end of the day the only reason people pay $2 for a Mexican Coke instead of 25 cents for an aluminum American is because the Mexican version is every American's dream of a 'real Coke'. Like it or not, that's the way it is!
PermalinkPermalink 06/20/06 @ 00:44
Comment from: MikeN SATX [Visitor] Email · http://myspace.xom/g0lden0ne
I have to say, I love the Mexican Coke! I have also tried coke bottled in Japan, Hong Kong, Poland, Thailand, Estonia, Jordan, Philippines, Ukraine, and the United Arab Emirates...to name a few, NONE of these other countries use HFCS... having had these in the middle east...I have seen my fellow Marines pass on the American crap (sold in the PXs) for the locally Arab country bottles...go figure. So don't give me the big load of CRAP saying that there is no difference in taste! These were served in cans, NOT the bottles that everyone of the coke lovers have said is the only difference! The sugar makes the difference!
PermalinkPermalink 05/09/07 @ 08:33
Comment from: Slabeth [Visitor] Email
You know, for years I've complained that when I visit the US I can stand the taste of Coke. (I live in Canada) I guess this explains it.

PermalinkPermalink 06/08/07 @ 09:53
Comment from: douglas gray [Visitor] Email
The Kosher Coke used to contain real sugar, but now they switched to sucralose (splenda) so if you want coke made with sugar, buy the Mexican stuff
PermalinkPermalink 11/28/07 @ 13:14
Comment from: Michelle [Visitor]
Try Boylans sodas with pure cane sugar or Dublin Dr. Pepper, an independant bottler who never switched to HFCS and still uses cane sugar. I believe that they are located in Texas.
PermalinkPermalink 01/24/08 @ 07:41
Comment from: Tim [Visitor] Email
So charge me the extra friggin' nickel and let me have sugar-sweetened Coke! I don't care. Call it Real Coke Classic, or Coke Elite. Just DO IT!!!
PermalinkPermalink 07/29/08 @ 19:09
Comment from: Gabriel Hartman [Visitor] Email
Ok so its better to let immigrants over but not there soft drinks? Why is Coke battling over coke coming from the border... This is foolish coke should sit down with its bottling suppliers tell them that we are going back to real sugar, no more fructose, we sell more, you sell more. A little price increase everyone happy. Probably put Pepsi back out on there butt. Good bussines sense.. Apparantly they are lacking it.
PermalinkPermalink 09/07/08 @ 20:19

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