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Cheerwine expands distribution area, pushing into new states

By Ely Portillo
elyportillo@charlotteobserver.com

Salisbury-based Southern soft drink Cheerwine is continuing its push to go nationwide, announcing Tuesday that it has inked a deal with Pepsi Beverage Co. to start selling in Atlanta, Memphis and Florida this week.

The company said the move doubles the size of its market. Cheerwine's goal is to be a national soft drink by 2017, the company's 100-year anniversary, executives said.

"We feel it's an ideal time to expand, and we're fortunate to be doing it with a world-class partner," said Cheerwine CEO Cliff Ritchie, in a statement. The company plans to introduce a new package design and make use of social media, in-person sampling events a three-state tour by "Miss Cheerwine" to promote the drink to new customers.

The privately-held company also launched a multi-million dollar ad campaign in the spring to boost sales.

Soft drink sales are an extremely competitive business, with about 90 percent of the $74 billion U.S. market controlled by giants Coca-Cola and Pepsi, and the smaller rival Dr. Pepper Snapple Group

The trade magazine Beverage Report said Cheerwine sales made up around 0.1 percent of the U.S. market in 2010, essentially the same as in 2005.

Cheerwine was pushed back into North Carolina in the 1990s after a previous expansion effort didn't take hold, because the company's independent distribution network fell apart.

Coca-Cola and Pepsi dominate soft drink distribution networks, and other brands must either pair up with the big players or rely on independent distributors. Cheerwine has partnered with Pepsi Bottling Company in central Virginia, Roxboro, Raleigh and other southern markets.


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