NEW YORK -- The summer-selling season went out with a bang over Labor Day weekend, with convenience-store dollar sales of packaged beverages up about 4% vs. the previous year, according to a retailer survey conducted by Wells Fargo Securities.

According to the survey, c-store beverage sales growth accelerated slightly, up 4% for Labor Day 2014 vs. 3.5% for Labor Day 2013.
“The largest contributors of this growth were: (1) successful product and package innovation from [Coca-Cola and Pepsi], (2) improved trends in the energy category and (3) improved traffic and increased basket sizes of purchases in c-stores,” the report states. “Further, total beverage sales are up 4% so far in the third quarter, led by Coca-Cola (+3%), Pepsi (+3%) and Monster (+7%).” Dr Pepper Snapple Group saw sales increase less than 1%.
New York-based Wells Fargo analyst Bonnie Herzog said she expected continued growth primarily in the energy-drink category, which “has re-accelerated in Q3, with sales projected to be up about 11%. Further, our retailers are generally very encouraged by Monster's innovation pipeline through its Ultra line extensions, as they are targeting new day-parts and increasing household penetration, which should drive incrementality.”
In a separate report, Herzog said total carbonated-soft-drink (CSD) dollar sales were up 0.2% (-0.5% for 12 weeks) in the latest Nielsen period during the 4 weeks ending Aug. 30, 2014, for all outlets (XAOC). The increase was driven by equivalent-unit pricing increases of 2.1% and equivalent-unit volume declines of 1.9%.
This represents the second month in a row of positive growth in dollar sales for CSDs, following over a year of declines.
Liquid teas had solid dollar sales growth of 6.2%, while sports drinks were up 3.2%. Bottled-water dollar sales were up 5.4%, with energy-drink dollar sales up a solid 11.0%, led by Monster’s strong 12.3% growth, followed by Red Bull’s modest growth of 7.1%.
In summary, Herzog said, “we are encouraged that beverage trends are picking up, and this should help drive better Q3 results for beverage manufacturers, particularly Coca-Cola, Pepsi and Monster.”
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