Whether it’s those summer days at the lake, fishing, relaxing on the Gulf Coast or just watching the kids’ baseball games, Alabamians get thirsty.
Sales of just non-alcoholic beverages in 2019 had a $3.3 billion direct economic impact on the state and provided more than 4,500 jobs, according to the Alabama Beverage Association.
Alabama-based operations of the two biggest soft drink powerhouses — Coca-Cola and Pepsi — are privately owned and have a super-sized presence in the state and beyond.
Coca-Cola Bottling Company United Inc., of Birmingham, is the second-largest privately held Coke bottler in North America and the third-largest bottler of Coke products in the U.S.
Buffalo Rock, also based in Birmingham, is the largest single-family-owned Pepsi bottler in the country.
Both have humble histories that date back more than a century.
$12,000 and a mule
Crawford Johnson started Birmingham Coca-Cola Bottling Company in 1902 with $12,000 and a mule. In 1915, they tested a secret product: the curved Coke bottle that would become the most recognizable advertising icon in history.
Johnson continued buying Coca-Cola franchises around the South. In 1974, they were combined under one umbrella called Coca-Cola United. Five generations of the Johnson family have worked there, and the company now employs approximately 10,000 people. Its six-state presence includes significant markets in Chattanooga, Atlanta — particularly noteworthy because it’s the worldwide headquarters of Coke — and Birmingham.
Coca-Cola United has a franchise agreement with The Coca-Cola Company, explained Linda Sewell, vice president of public affairs and communications for Coca-Cola United. The parent company is responsible for formulas and new products.
“As a bottler, we are responsible for the production, the bottling, the sales, the marketing, the distribution, so it’s really soup to nuts of the beverage business,” Sewell says.
The Coca-Cola Company decided to transition out of the bottling business years ago, she explained.
“The majority of our growth came from an agreement we had with Coca-Cola Company when we purchased their territories.
“They sold their bottling rights in different parts of the country they had to bottlers. They divided it up. For Coca-Cola United, we acquired territory that was contiguous to our territory.”
The transition happened over five years.
Coca-Cola United produced approximately 230 million cases of beverages in 2020, company figures show. Revenue topped $3 billion.
With more Americans turning to water or energy drinks instead of sweetened colas, you might expect soda sales to fall flatter than a two-liter left uncapped.
“Our business over the past few years has continued to increase and has been stronger than ever,” Sewell says. “Not only is it not declining, it has increased. We have had extraordinary years.”
Of the 750 or so products they produce or sell, “almost half of those are low- or no-calorie beverages,” she says. The company philosophy is that different drinks appeal to people at various stages in their lives and are referred to as “beverages for life.” Their portfolio includes Glaceau smartwater, Dasani, Monster Energy, Minute Maid, Powerade and Bodyarmor sports drinks, and new Coke with Coffee.
“Because of that we have something for everyone,” Sewell says.
President and CEO John Sherman took over in 2016. And this year, Coca-Cola Bottling Co. United won Beverage Industry magazine’s Bottler of the Year honors.
“We continue to make significant investments in the state of Alabama,” Sewell says. “Right now on our Birmingham campus we’re making a $5 million expansion there. Over the past few years, we have grown and built new facilities in Montgomery, both production and our sales facility, and continue to put millions into those facilities.”
In March, Coca-Cola United announced plans to invest $48 million in its Mobile plant and a $60 million sales center and warehouse is in progress in Tifton, Georgia.
“There’s a lot going on in Alabama,” Sewell says.
And she hints that there’s more fizzy news to come.
“We have some really, really big plans in the next few years coming closer to home, in Birmingham,” she says.
Beginning in the late 1800s, Sidney Lee and a Selma chemist developed Buffalo Rock Ginger Ale. For the next 30 years, the company’s main products were Buffalo Rock Ginger Ale, Mission Orange, Mission Grape and B-1. The Lee family started Buffalo Rock Company in 1901.
Originally located on First Avenue North in Birmingham, Buffalo Rock moved its operations to 10th Avenue and 26th Street North in 1922.
Buffalo Rock is now one of the nation’s largest privately held, family-owned Pepsi and Dr Pepper bottlers. It employs more than 2,100 people who serve more than 7 million consumers throughout Alabama, western Georgia and the Florida Panhandle through 14 distribution centers. They produce 28 million to 30 million cases of product each year.
In March of 2021, Matthew Dent was named chief executive officer — the first one in 120 years who is not a member of the Lee family. Beginning as an intern with the firm 25 years ago, Dent served as president and chief operating officer before becoming CEO.
James Lee III, now the fourth generation, will continue to serve daily as
executive chairman of the company.
“We are thrilled and extremely supportive of these executive appointments at Buffalo Rock Company, which has been a 70-year partner of PepsiCo,” Kirk Tanner, CEO, PepsiCo Beverages North America, said at the time of Dent’s promotion.
In November 2020, Buffalo Rock purchased an 895,000-square-foot ware-house and 120,000-square-foot office building in Birmingham with plans to invest $75 million in improvements.
“This is the largest infrastructure investment in our company’s history, and we
are proud to make it in Birmingham,” Lee said. “We’ve been in business in Birmingham since 1901, and today’s announcement is a reflection of our ongoing commitment to this community.
“This year we are celebrating the 120-year anniversary of when my family started our company right here in Birmingham, and we have come a long way since that time thanks to our employee-partners,” he said.
In December 2020, Buffalo Rock announced plans for a $20 million investment in Huntsville.
South Alabama Pepsi
One of the biggest independent Pepsi distributors in Alabama is in Crenshaw County.
Pepsi-Cola Bottling Co. of Luverne Inc. has been family-owned and locally operated since 1915. Andrew Smith, chief financial officer, says company leaders credit their 90 employees for their success. “We have a team of dedicated, passionate people who take pride in providing quality customer service,” says Smith. “Strong brands, great products and a commitment to service has allowed our business to prosper and expand through the years.”
This story appears in the July 2021 issue of Business Alabama magazine.