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Legislation forces Coke and Pepsi to change their recipe

Penny Brooks

9th March 2012

Coke and Pepsi are estimated to have a 90% share of the global market for fizzy drinks between them and both fiercely guard the ‘secret recipes’ which protect their strength in the market. However, the state of California has added the chemical 4-methylimidazol to its list of carcinogens, and both companies use this ingredient to add chemical colouring to their drinks. If they continue to use it, they would need to add a cancer warning label to their cans and bottles, to comply with California laws - and neither want to do that.

The American Beverage Association, which represents the wider industry, says that although the chemical is found to cause cancer in mice or rats, there is no evidence that it does so in humans as well.

Coca-Cola representative Diana Garza-Ciarlante takes on the story:

“While we believe that there is no public health risk that justifies any such change, we did ask our caramel suppliers to take this step so that our products would not be subject to the requirement of a scientifically unfounded warning,”

In other words they cannot take the risk of allowing the impression that their product may have adverse health risks. And although the requirement to change labelling only applies in California, they are implementing the change across all of their US manufacturing in order to streamline production processes - the operations management issues must make it simpler and more efficient to have one recipe for all output rather than differentiating between output for California and the rest of the country.

No reference in the article here from the LA Times to whether their production outside of the US is affected…..

Penny Brooks

Formerly Head of Business and Economics and now Economics teacher, Business and Economics blogger and presenter for Tutor2u, and private tutor

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