NEW YORK -- Bottled water, energy drinks and iced tea led growth in the beverage category in convenience stores during the fourth quarter of 2015, according to the latest Wells Fargo Beverage Buzz survey of c-store retailers.
"Non-alcohol beverage sales increased a solid 5.5% year over year in the fourth quarter, with nearly half of respondents indicating that sales were up high single digits/[low] double digits," analyst Bonnie Herzog wrote. "Solid results were driven by a 'perfect combination of good weather and low gas prices.' according to one retailer."
Bottled-water sales grew a healthy 11.1%, while energy-drink sales were up 9.8% and sports drinks grew 7.5%.
"Interestingly, several retailers suggested single-serve purchases in particular are driving growth, which 'is good for traffic in stores and gross profit margins, however is having a negative impact on dollar sales and case movement.' "
All three of the major beverage manufacturers saw decent growth. Wells Fargo, New York, estimated Coca-Cola Co.'s c-store retail sales were up 2.9% based on aggressive pricing and successful promotions, while PepsiCo sales grew 3.2% and Dr Pepper Snapple Group was up a strong 6.1%, both buoyed by product innovation.
On the alcohol side, c-store sales grew 4.1% during the fourth quarter. Herzog said craft and import beers continue to win the day in product selection, while single-serve is the growing preferred package size.
"Our survey respondents expect non-carbs and energy to continue to lead non-alcohol beverages, while craft/import beers should still outperform within the alcoholic beverage category," she said.
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