New Delhi: If the sources are to be believed, Domino’s Pizza, operated by Jubilant Food-Works (JFL) might replace its beverage partner in India. The company might rope in PepsiCo and end its 20-year exclusive deal with Coca-Cola in India.
According to the people who are aware of the development, Domino’s is actively negotiating with PepsiCo and the motive behind this is seen as a move to save costs.
Confirming the development, a JFL spokesperson said, “The 20-year long partnership with Coca-Cola in India was extremely great. With the motive to take the business to the next phase of growth, we are looking for other options and initiated the process regarding the same. We would like to identify the right beverage partner which can be beneficial for us in strengthening our beverage portfolio too.”
As per the information available, last week JFL has asked PepsiCo to present its contract terms.
It should be noted that Domino’s is present in 85 countries globally and has been in an exclusive partnership with Coca-Cola worldwide except in Australia, New Zealand and Malaysia where it serves PepsiCo brands.
Former senior PepsiCo executive and business consultant, Llyod Mathias, says, “In order to get better commercial terms, stronger advertising and marketing support, big food chains may switch their beverage exclusivity. Sometimes it may also be to shake up the status quo by injecting a competitive element.”
Notably, Pizza Hut, operated by Yum! Brands also has a long-standing partnership with PepsiCo.
JFL is keen to increase profitability in India which is a significant market for Domino’s. For the quarter ended June 30, it reported more than a three-times increase in YoY net profit which was mainly driven by everyday value pricing and menu innovations.