Reports of the restructuring could heighten the tension between Coke and its bottlers, over 50 of whom have recently filed lawsuits against the drinks giant and its major bottler Coca-Cola Enterprises over the proposed implementation of a new distribution method for its Powerade energy drink

Food & Drink Weekly, March 6, 2006

Reports of the restructuring could heighten the tension between Coke and its bottlers, over 50 of whom have recently filed lawsuits against the drinks giant and its major bottler Coca-Cola Enterprises (CCE) over the proposed implementation of a new distribution method for its Powerade energy drink.

The bottling companies, which generate around 10% of Coke's U.S. volume, are seeking to block Coke and CCE from expanding delivery of PowerAde sports drink directly to Wal-Mart warehouses beyond a current trial in Texas. They are concerned that a national rollout could trigger requests from other retailers for warehouse delivery which they claim provides an inferior service to direct-store delivery, known as DSD. Coke counters that it is merely accommodating a request from Wal-Mart, the world's largest retailer, for warehouse delivery.