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David
10-05-2009, 06:30 PM
I had read somewhere that competitors can tie-in to Coke or Pepsi's equipment that is installed in the bars. It had something to do with them having a monopy in that bar. I have seen Coke on a Pepsi gun and vise versa.

Does anyone know of the ruling or what ever it's called?

mofizz
10-06-2009, 06:01 PM
This is usually not the case. I don't know of any "monopoly" law that allows competitors to hijack space on someone elses equipment just for the sake of variety. Coke or Pepsi puts up the capital expense in equipment to pump as many gallons of thier product as they can. This is clearly how they profit on fountain syrup. Any competing gallons kind of put that model in reverse.

That said, if the customer owns his or hers own equipment then it is fair game for whatever they want to pour. Also, some national contracts allow an allied brand such as dr. pepper or crush to have a valve on pepsi or coke equipment. That's how the taco bell one is, but it is also how the contract is negotiated.

the saint
10-06-2009, 07:40 PM
I am sure you can contact some of the other off brand energy drink people who have their product in bibs and see how this alleged law worked out for them. mofizz has it correct that if it is coke or pepsi equipment you are out of luck, and that if it is customer owned and the customer wants to use your brand then have at it.

NRGSLLR55
10-09-2009, 04:02 PM
I had read somewhere that competitors can tie-in to Coke or Pepsi's equipment that is installed in the bars. It had something to do with them having a monopy in that bar. I have seen Coke on a Pepsi gun and vise versa.

Does anyone know of the ruling or what ever it's called?

You may want to look at this:

The Clayton AntiTrade Act of 1914

14. Sale, etc., on agreement not to use goods of competitor
How Current is This? It shall be unlawful for any person engaged in commerce, in the course of such commerce, to lease or make a sale or contract for sale of goods, wares, merchandise, machinery, supplies, or other commodities, whether patented or unpatented, for use, consumption, or resale within the United States or any Territory thereof or the District of Columbia or any insular possession or other place under the jurisdiction of the United States, or fix a price charged therefor, or discount from, or rebate upon, such price, on the condition, agreement, or understanding that the lessee or purchaser thereof shall not use or deal in the goods, wares, merchandise, machinery, supplies, or other commodities of a competitor or competitors of the lessor or seller, where the effect of such lease, sale, or contract for sale or such condition, agreement, or understanding may be to substantially lessen competition or tend to create a monopoly in any line of commerce.

the saint
10-10-2009, 12:25 AM
You may want to look at this:

The Clayton AntiTrade Act of 1914

14. Sale, etc., on agreement not to use goods of competitor
How Current is This? It shall be unlawful for any person engaged in commerce, in the course of such commerce, to lease or make a sale or contract for sale of goods, wares, merchandise, machinery, supplies, or other commodities, whether patented or unpatented, for use, consumption, or resale within the United States or any Territory thereof or the District of Columbia or any insular possession or other place under the jurisdiction of the United States, or fix a price charged therefor, or discount from, or rebate upon, such price, on the condition, agreement, or understanding that the lessee or purchaser thereof shall not use or deal in the goods, wares, merchandise, machinery, supplies, or other commodities of a competitor or competitors of the lessor or seller, where the effect of such lease, sale, or contract for sale or such condition, agreement, or understanding may be to substantially lessen competition or tend to create a monopoly in any line of commerce.


this is all fine and good. Pepsi and/or coke are not telling the bars that they cannot bring in other competitors product provided that the competitors bring in their own equipment to serve their product. Using another companies equipment is akin to "well my pepsi delivery truck is broken down, I am going to piggy back hook my trailer onto your coke trailer and just ride in the cab with you. we would be going to the same stops so why not, after all the clayton act says that I can do this, if you do not let me then you trying to lessen competition and create a monopoly."

fusion
10-10-2009, 05:00 AM
Blah. Sounds like a bunch of malarkey to me.

"Because the act singles out exclusive dealing and tying arrangements, one may assume they would be subject to heightened scrutiny, perhaps they would even be illegal per se. That is not the case. When exclusive dealings or tying arrangements are challenged under Clayton-3 (or Sherman-1), they are treated as rule of reason cases.

Under the 'rule of reason', the conduct is only illegal, and the plaintiff can only prevail, upon proving to the court that the defendants are doing substantial economic harm. Despite what the statute may suggest, the regime makes sense. The reason for the per se rule in Sherman-1 price fixing cases is the overwhelming likelihood that price fixing is harmful. It is a recognizable fact that exclusive dealings and tying arrangements are quite common, and potentially beneficial to consumers, and the economy. Therefore, the Court has seen fit not to apply a per se rule to Clayton-3 conduct."

Exclusive agreements are not illegal per se, which means they are not inherently illegal. They are only illegal if they are doing substantial economic harm. Coke/Pepsi/whoever keeping a competing company out of a location through an exclusivity agreement probably wouldn't meet that threshold.

Companies are protective of leased equipment, and some store owners and outlets seem to have trouble understanding that. The equipment is leased, usually at no cost to the outlet, with free service repair, contingent on the owner not placing any competing products in the equipment. I think there is room for a certain amount of discretion on a account manager's or district manager's part, but they would obviously draw the line somewhere.

I used to work for Coca-Cola New York, which was later acquired by CCE. After CCE took over, they really started enforcing this. There were accounts where you would walk in and the cooler had more non-Coke products than Coke products. And account managers and merchandisers were specifically told "NO FOREIGN PRODUCT." Pretty easy to enforce in chain stores and such, but a little tougher in the AOM/UDS segment.

Then I remember a case a few years ago where a small store owner had a Pepsi cooler placed in his store. The driver salesman (no pre-sale in the area I work in) would deliver to the store, and find a bunch of other stuff in there. So he would report that back to his boss, the route supervisor, who would visit the account. The owner would say... yeah, I'll take that stuff out - but he never did. So after a few times, the supervisor sent the cooler delivery team to the account to take the machine back. The owner flipped out, and ended up breaking one of the doors while trying to stop the guys from taking it.

Anyway, I got a little off topic. Keeping a competitor off your equipment is not illegal under Clayton, and signing an exclusive agreement keeping the competitor out of the outlet completely most likely wouldn't violate Clayton, either. One outlet does not a monopoly make, nor would it cause substantial economic harm to the competitor.

fusion
10-10-2009, 05:07 AM
Those same store owners also generally have no problem transporting product across franchise boundaries. I would walk into that store, and see angle Dr Pepper 20oz, and Pepsi has Dr Pepper in that area (Coke has it to the north and east).

Apparently contour 2L has been spotted at an outlet near our office, which is at least 35-40 minutes from any territory that currently sells contour (ABARTA Coke or Philadelphia Coke). Pretty obvious they didn't get it from us.

Or they'll do that, and then want us to swap out ooc product or swap out core for flavors, and so on. Sometimes I'm glad I'm not an AM or DM.

the saint
10-10-2009, 10:01 AM
Those same store owners also generally have no problem transporting product across franchise boundaries. I would walk into that store, and see angle Dr Pepper 20oz, and Pepsi has Dr Pepper in that area (Coke has it to the north and east).

Apparently contour 2L has been spotted at an outlet near our office, which is at least 35-40 minutes from any territory that currently sells contour (ABARTA Coke or Philadelphia Coke). Pretty obvious they didn't get it from us.

Or they'll do that, and then want us to swap out ooc product or swap out core for flavors, and so on. Sometimes I'm glad I'm not an AM or DM.

Welcome to my world, won't you come on in.....

The ones I love are the little crapholes that change ownership every two or three months that do not understand that, yes you did buy everything in the building when you bought the store BUT that cooler is property of pepsi and the previous owner did not have any legal right to inform you that you were purchasing the cooler. You do not own that cooler and you cannot place anything in it if it doesn't get delivered on a pepsi truck. no I do not care if it is pepsi product that you bought from sams, walmart, etc. It did not come off of the pepsi truck therefore it is foreign product.

Then they get all defensive and they are gonna kick me/pepsi/us out of their store because we are not going to tell them how to run their store, ( I always just laugh to myself when I hear this knowing that within 6 months there will be a new schmuck at this store telling me the same thing) I say ok whatever I will call in to have MY cooler picked up. I call in as hostile pickup that way the install/uninstall people will contact management when they are on their way and there will be 10 or so people bumrush the account (sometimes the police are brought in to enforce our picking up our equipment) pull everything out of the cooler and leave with it in about 10 minutes.