Kothari Is No More Coca-Cola Kin(ley)

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New Delhi, June 8: Coca-Cola India (CCI) has snapped ties with two of its franchisee bottlers/contract packers which were manufacturing its packaged drinking water Kinley till recently. Close on the heels of breaking its alliance with Delhi-based Nuchem Weir, the soft drinks major has now parted ways with its another franchisee partner Kothari Beverages, part of the Rs 400 crore Kothari Group.

Coca-Cola India spokesperson, when contacted, refused to comment. Kothari Group managing director Deepak Kothari, however, confirmed the development. “It’s better to work for your own company and at your own pace rather than work for any multinational company,” Mr Kothari told the FE.

Industry observers believe that there could have been many reasons for the disengagement. For one, the deal may not have been offering full value to CCI anymore. According to them, for CCI, using local contract packers made good business sense as an initial strategy to kickstart its operations in packaged water but as the company gained volumes, it opted out of the alliances it had formed with local partners.

Distribution, they point out, is the key in the marketing of bottled water in India, and acquisition of a readymade distribution network makes ample sense to any multinational company. Both, Kothari and Nuchem, had nurtured a well-established distribution network through their fairly popular brands Yes and Krystal, respectively.

Both the homegrown bottlers are now busy reviving their respective bottled water brands which had gone into oblivion once they became contract packers for Coke producing and packaging Kinley brand of bottled water.

Nuchem, for instance, has recently started manufacturing and promoting its brand Krystal afresh in the market. Similarly, Kothari Beverages is reviving its once well-known bottled water brand Yes in the country.

“We have decided to focus and develop our own brand Yes, once again,” Mr Kothari said. Yes was introduced in 1994, first in Gujarat and Rajasthan. The brand was soon launched nationally which captured more than 60 per cent of the market share, claims Mr Kothari.

Kothari Beverages has 12 plants spread over the country including its Nadiad plant in Gujarat, and others in Kanpur, Bangalore, Baddi and Mumbai. It also has five franchisee-owned plants in Jaipur, Raipur, Nepal, Ahmedabad and Hyderabad with a combined production capacity to process 1.0 million ltrs of water per day.

According to Mr Kothari, the company was co-packing about 3 lakh cartons (each containing 12 bottles of 1-litre pack) per month.