Will the price of Coca-Cola rise in 2021? Coca-Cola China responds that the price of Coke will rise!

In recent days, the news that "Coca-Cola will raise the price" has become the focus of attention.

According to US media reports, Coca-Cola CEO James Quincy said on April 19 that the company's beverage prices would rise in response to rising commodity prices. So far, Coca-Cola has not disclosed which products will increase prices.

However, whether "Coca-Cola will raise prices" will also have an impact on the domestic industry is also concerned by the industry. On April 23, the relevant person in charge of Coca-Cola China said to the outside world: "We do not have relevant information about foreign media reports at present."

Looking back on past events, Coca-Cola also announced a price increase in 2018.

The price increase is due to a rise in the cost of producing beverage cans due to a 10 per cent tariff on aluminium products imposed by former US President Donald Trump during his administration.

The direct reason for the "Coca-Cola price increase" is the rise in commodity prices. For example, the metal aluminum needed for Coca-Cola cans has increased by 23.2%, resulting in a 5-cent increase in the cost of Coca-Cola cans. if you add high fructose syrup, PET materials and other packaging materials, it means that this round of commodity price increases in Coca-Cola production costs are even higher.

"We have good hedging measures in 2021, but there is increasing pressure in 2022, so prices have to go up," James Quincey, Coca-Cola chief executive, said in an interview with US media on Monday.

In addition to raising prices to cope with the pressure, Coca-Cola last year also helped ease some of the operating pressure through layoffs and other cost-cutting measures, thereby improving operating margins.

Coca-Cola announced in December last year that Coca-Cola in the United States will cut 1200 jobs through layoffs and buyouts, accounting for 12% of its home market workforce, with 2200 layoffs. About 1200 of them are American employees. In October of the same year, Coca-Cola also said it would stop producing beverages with low sales and outdated sales. And plans to eliminate about 200 sub-brands, accounting for about half of the company's total number of brands, and only retain brands that can do large-scale, in order to ease the pressure on the company's supply chain.

As for the withdrawal of many Coca-Cola products from the market, Coca-Cola has previously said that Coca-Cola's plan to cut the number of brands by more than half and lay off staff is one of the extensive restructuring measures triggered by COVID-19 's epidemic. In the stagnation or recession period of the company to reduce ineffective products, retaining the core mainstream business is also an important measure to ensure the normal operation of the company, but also open up more incremental space for innovation.

Finally, back to the topic of "Coca-Cola will rise in price", in fact, a lot of things are going up, and the price increase is bound to affect consumers, but if the original price is maintained as costs increase, it may eventually lead to a loss for the enterprise. of course, as industry insiders said: although the price increase also helps the company's profit margin, it may have a potential adverse impact on market share.

* Image source: Internet