I am a student currently doing a report about the energy drink industry.

While doing my research, including talking to a few individuals, I was told that distributors are currently only willing to pay around $2.40 per 24 can case for new "upstart" energy drinks.

Is this true?

Is that even possible?

The people I had talked to claimed it is done that way to force the "upstarts" to build market share by investing more heavily, before they can sell it for what they want. And it also a way to keep the market from being to oversaturated. Even with that being said, it just doesn't seem to me that this is entirely possible.

For one, doesn't it cost about 6 to 10 dollars to produce a 24 can case? If that is true how would anyone ever survive past the start?

I can understand the possibility of an upstart not making money initially, but lose that much on a case, besides marketing, promotion, and overhead?

Any suggestions would be greatly appreciated. Thank you for your time and consideration.

Not only is that ludicrous but it is also completely false.

You can try to muscle a new start up to sell you a case for around $18, but $2.40...no way.