Inside Iowa State

January 14, 2005

Campus beverage machines have new supplier

by Anne Krapfl

The process of replacing Coca-Cola beverage vending machines on campus with Pepsi and Dr. Pepper/7-Up machines wrapped up last week. ISU Dining, which manages the campus vending service, and ISU Purchasing, which administers university contracts, developed a new contract for beverage vending in a competitive bid process. The new contract is for five years, with the option of five one-year renewals.

The contract affects campus beverage vending machines only (approximately 175 machines). 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 sell Coke products.

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, Country Time and Fusion 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. 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.

Lewis said no price increases are planned with the switch.

In addition to a larger product line, 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.

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.

Approximately 175 Coca-Cola vending machines on campus have been replaced with Pepsi or Dr. Pepper/7-Up machines under a new contract. The change was made, in part, to offer a larger selection of canned and bottled beverages. Coca-Cola still has contracts with ISU Dining for the residence dining centers, Iowa State Center and Jack Trice Stadium. Campus convenience stores and cafes also will continue to sell Coke products. (Photo by Bob Elbert.)