Industry News | December 1, 2003

Subway Chooses Coke

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Subway Restaurants has reached an agreement with The Coca-Cola Company, which will make Coca-Cola beverages available in more than 20,000 Subway restaurants worldwide. Prior to the deal, Coke supplied only about 15 percent of the Subway system, with the rest of the business belonging to Pepsi.

According to a release, Subway decided to partner with Coke as a way to maximize its future growth and capitalize on major marketing, innovation and service opportunities the Coke system offers. The decision came after a year-long comprehensive evaluation and negotiation process.

Neither Subway nor Coke would disclose specifics of the contract. But the Atlanta Journal-Constitution quoted Pepsi spokesman Larry Jabbonsky suggesting Coke offered Subway a sizable amount of cash for the deal.

"We have been Subway's supplier of the year for the past seven years in a row," Jabbonsky told the AJC. "So it's inconceivable to think this has anything to do with products or service. This is about an incredibly big bag of cash, and we hope Coke's offering the same deal to the rest of their customers."