December 15, 2004

Campus beverage machines have new supplier

by Anne Krapfl

Your local soda machine soon will have a new look.

Beginning Dec. 16, Coca-Cola beverage vending machines on campus will be replaced with Pepsi and Dr. Pepper/7-Up machines. ISU Dining, which manages the campus vending service, and ISU Purchasing, which administers university contracts, have developed a new contract for beverage vending in a competitive bid process. Coca-Cola has supplied the beverage machines on campus for eight years; the current agreement ends Dec. 31.

The new contract affects campus vending machines only. Coca-Cola still has contracts with ISU Dining for the residence dining centers, the Iowa State Center and Jack Trice Stadium. Campus convenience stores and cafes also will continue to sell Coke products. In spring 2001, a campus committee rejected the notion of an exclusive beverage contract on campus, so separate contracts in the various venues are rebid as they expire.

The shared contract was recommended by an advisory committee that included faculty, staff and student invitees. The change was made, in part, to offer a larger selection of canned and bottled beverages on campus. In addition to products with a Pepsi name, Pepsi offers Mountain Dew; Slice; Mug root beer; Lipton ice teas; Tropicana and Dole fruit drinks; Gatorade, Aquafina and Propel waters; and Frappuccino. In addition to Dr. Pepper and 7-Up products, the Dr. Pepper/7-Up company offers A&W root beer, Sunkist, Squirt, Welch's and Snapple drinks, Arizona teas, Deja Blue and Clearly Canadian waters, RC Cola, Diet-Rite, Canada Dry, Country Time and Fusion soft drinks.

Because of the larger product line, ISU Dining director Jon Lewis said he anticipates about a 20 percent increase in sales from beverage machines.

There are about 175 beverage vending machines on campus, and Lewis said members of his staff will work with the beverage vendors to choose specific products for the machines. Machines will offer either 20-ounce bottles or 12-ounce cans.

Noting that ISU Dining raised prices in vending machines last January, Lewis said no price increases are planned with the switch.

About 65 percent of the machines on campus will feature Pepsi-owned products. The remaining 35 percent will offer beverages from the Dr. Pepper/7-Up company.

In addition to a larger product line, quality service and new or near new vending machines, Lewis said the Pepsi-Dr. Pepper combination offered Iowa State the best financial package. All vendors who submitted a vending proposal were required to include shared and exclusive beverage options in their bids. The contract is for 5 years, with the option of 5 one-year renewals.

ISU Dining receives a guaranteed percentage on total sales from the beverage vending machines. The new contract is expected to generate about $400,000 annually for ISU Dining. Lewis noted that the beverage side of the vending operation supports the more labor-intensive food vending on campus. In addition, a portion of the revenue is shared with student groups, such as college councils, and ISU departments.

To better distribute its available Coke products on campus until the machines are removed, the Coke vendor emptied eight low-volume machines Dec. 10 and put that product in higher-demand locales, Lewis said.

Switching vending machines is expected to take just a few weeks. Lewis said a Coca-Cola machine should be replaced the same day with a new machine.

The new contract affects campus vending machines only. Coca-Cola still has contracts with ISU Dining for the residence dining centers, the Iowa State Center and Jack Trice Stadium. Campus convenience stores and cafes also will continue to sell Coke products.