Coke retains rights, USC wins extra money in seven-year deal:
Source: By Kathryn Kranjc, Assistant News Editor
email@example.com Date: Tuesday, 20 September 2011 23:35
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When the Coca-Cola Happiness Machine made a stop at the Russell House last Wednesday to celebrate the company’s renewed contract with USC, students lined up by the dozens for complimentary T-shirts, Twister games and Silly String with their beverage purchases. But the university is scoring more than dollar store prizes from its deal with Coca-Cola. In exchange for seven years of beverage rights to vending machines at USC’s Columbia, Lancaster and Union campuses, Coca-Cola has guaranteed the university an annual commission of $465,000 — or about $3.25 million over seven years.
USC will earn $53,000 more a year than it did in its last five-year contract with the beverage company, which expired this summer. In that time period, Coca-Cola has also paid to equip 92 machines with CarolinaCard readers at a cost of $1,500 per upgrade.
Under the new contract, new machines will be added on an as needed basis, and CarolinaCard readers will be added to a minimum of 12 additional machines, and credit card readers will be added to at least 10 machines.
“Providing beverages in vending machines is a service to our campus community in addition to producing revenue to the university,” Vice President for Business Affairs Helen Zeigler wrote in an email through internal communications. “Coca-Cola was selected for this contract through a competitive bid process.”
Not everyone at the university is quite so thrilled about Coke’s renewed hold over the campus’s beverages. At the time of the contract, some members of the board of trustees expressed concern over the deal’s effect on student health. According to the U.S. Department of Agriculture, per capita soft drink consumption has risen nearly 500 percent in the past 50 years and is now the leading source of added sugar in the diet. Several studies, including a report from the Harvard School of Public Health, have linked this increase in consumption with soaring rates of Type 2 diabetes and metabolic syndrome, a group of risk factors that contribute to a wide variety of health problems.
Healthy Carolina, a campus-wide initiative to improve the health of students, faculty and staff led by USC’s Division of Student Affairs, has already provided “healthy comparison” information for several snack vending machines through a partnership with Atlas Foods. However, it holds no such influence over the drink options offered at the campus’s 157 drink machines.
“I’m not sure why this was not included in any agreements, but I think it could be something good to move toward in the future,” said Alissa Thebarge, Healthy Carolina’s new program coordinator. “The fact that there are so many opportunities to buy soda on campus is a concern, but I don’t foresee those areas being replaced just because of the money the university gets from its contract with Coke. I think if Healthy Carolina were to do anything in this area, it would take the Coca-Cola Company’s willingness to work with us on this point, since it seems like Atlas has been a big reason why this has worked so far.”
According to Zeigler, one of the new additions to the contract is working toward expanding beverage inventory to include more lower-calorie beverages.
“There has been a considerable focus on providing noncarbonated, diet and healthier drink alternatives in the vending machines on campus,” Zeigler said. “We are in constant dialogue with our drink vending partner about identifying brands that will appeal to all of our student population and allow students to make individual beverage choices.”