Discretionary spending has taken a hit during the year 2020. Restaurants, live events, movie theatres, and sporting venues have endured the most difficult times as compared to other sectors of the economy. These businesses have been subject to lockdown guidelines and they also happen to be some of the most important channels for beverage companies. Businesses like Coca-Cola Consolidated have seen revenues from these channels drop significantly. In fact, the drop has been far more than the rise in sales as a result of people stocking beverage products at home.
Coca-Cola Consolidated 3Q2020 Company Updates
Coca-Cola Consolidated shared updates about its efforts to establish a networked structure for better execution. Company CEO James Quincey said, “We are also strengthening our bottling partnerships across the system to enhance execution across channels. In order to ensure the structure of our company facilitates the success of our accelerated strategy, we’re becoming a more networked organization that will combine the power of scale with deep knowledge to win locally. We expect this new networked model to be established and functioning at the beginning of the next year, and platform services will be fully integrated, standardized and scaled over the course of next year.”
The company has also decided to focus more on its growth brands. It is streamlining its master brands by about 50% to reduce complexity. This will result in a less than 1% impact on the top line. But the benefits will more than offset this impact.
Performances of The Beverage Stocks To Buy Right Now
Coca-Cola Consolidated, Keurig Dr Pepper, and Pepsico are the three biggest beverage companies. All of them have had a decent 30 days. Keurig Dr Pepper is up more than 1%, Pepsico is up 2.5%, while Coca-Cola Consolidated is up a staggering 7%. However, the situation is a little different when looking at the year 2020. On a year-to-date basis, Keurig Dr Pepper is up 2.6%, Pepsico is up 5%, and Coca-Cola Consolidated is down 5%.