SodaStream

[jpatter666]

Originally thought about putting this in Traders Corner, but it really doesn't fit.

SodaStream (SODA) sells seltzer makers. They also sell flavor packs (cola, energy, root beer, etc) and CO2 recharges. The company has decent, but slowing market penetration in Europe and has been moving into the US.

My wife bought one of these and is completely hooked. First, you get fresh seltzer water whenever you want it. Tastes better and fresher than anything you get from the store. She drinks it without flavoring, I prefer the energy packets which are far, far cheaper than Red Bull!

Also, you re-use the same containers for the water which makes it more environmentally friendly.

Stock got pounded recently and I'm considering adding a position. Nothing to really do with the iTulip thesis, but thought I'd put it out there.

And if nothing else, might want to consider one. Takes mixed drinks to an entirely new level!

[lakedaemonian]

Re: SodaStream

SodaStream has had a certain level of popularity down here in NZ.

I assumed a decade ago when moving down here that the product was in the market due to relative poverty.....but I can see in a future world where shipping fizzy water/pop becomes much more expensive that maybe the home will replicate the fast food outlet....with only the essential ingredients beings shipped and mixed/carbonated on site.

We don't drink fizzy water in our house....but you might be on to something long-term.

[flintlock]

Re: SodaStream

Cramer was talking about this on his show this morning( replay from last night). I'd never heard of it before. His take, for what its worth. ( I'm not a fizzy water drinker either, so I don't get it)

[jpatter666]

Re: SodaStream

Valid points -- for Cramer.

All this said, let me be very *very* clear. I have *not* initiated a position in this company. The pullback was of enough significance to put it on my radar again, but my own due diligence is still underway.

We really like the product -- but sometimes the product is good and the company isn't.

We'll see.

[flintlock]

Re: SodaStream

I have a theory I'll throw out there. Perhaps soda drinkers who switched to SodaStream to save money have decided they can save even more by quitting completely. Those who can afford it, well, they'll continue buying the cans off the shelves anyway. It just seems like the world is falling into a have or have not society, with little in between. That's why you see companies like Apple doing well despite the "bad times". Perhaps picking the leading companies that sell premium products is a good investing strategy today instead of companies catering the the rest of us. I know I could not give a damn about luxuries right now.

I have seen these type products on the shelves at BJs wholesale. It never dawned on me that it was a public company though. Cramer mentioned on his TV show that it compared to the little single serve coffee makers that have become popular. I don't know. I would go to the trouble to make coffee, but soda?

[jpatter666]

Re: SodaStream

I have a theory I'll throw out there. Perhaps soda drinkers who switched to SodaStream to save money have decided they can save even more by quitting completely. Those who can afford it, well, they'll continue buying the cans off the shelves anyway. It just seems like the world is falling into a have or have not society, with little in between. That's why you see companies like Apple doing well despite the "bad times". Perhaps picking the leading companies that sell premium products is a good investing strategy today instead of companies catering the the rest of us. I know I could not give a damn about luxuries right now.

I have seen these type products on the shelves at BJs wholesale. It never dawned on me that it was a public company though. Cramer mentioned on his TV show that it compared to the little single serve coffee makers that have become popular. I don't know. I would go to the trouble to make coffee, but soda?

Possible. Certainly they are not cheap. Not sure if I'd compare to the single-serve coffee makers though. These make a carafe of soda water. More comparable to the grind-your-own-beans person -- which we also are.

Overall, grinding our own beans requires some up-front investment for the grinder, but we find the result far superior to buying pre-ground beans. And it's still way, way cheaper than Starbucks.

Come to think of it, we *do* drink less soda now overall. But my wife drinks lots more fizzy water....not sure how it balances out. Certainly I like the freshness of the SodaStream soda more than the junk I used to buy in stores.

[lakedaemonian]

Re: SodaStream

Wouldn't it be interesting to see the big players like Coca-Cola and Pepsi either acquire such a company or develop their own inhouse system?

Surely a team of MBAs would have run the numbers on trying to implement a "razor blade model" in shrinking the existing model Coke & Co use in pushing syrup product through retail dispenser points into a "cute" home version. They've got the cash to take the upfront investment loss to enjoy the long-term profits.

Not only would it lock consumers into a proprietary fizzy water dispensing system, but could see increased profits from higher value/smaller cube distribution in a Peak Cheap Oil world.

Newspapers have shrunk considerably in big markets....same has happened with laundry detergant.....maybe it will happen with fizzy water.

To me at least...any move in that direction by the big players to cut the weight/cube of the product they distribute would be a strong indicator of their belief in a Peak Cheap Oil world.

The same goes if they shift from distributing bottled water to developing/distributing water purification product "subscriptions" of some form or nature.

Just my 0.02c

[jpatter666]

Re: SodaStream

Wouldn't it be interesting to see the big players like Coca-Cola and Pepsi either acquire such a company or develop their own inhouse system?

Surely a team of MBAs would have run the numbers on trying to implement a "razor blade model" in shrinking the existing model Coke & Co use in pushing syrup product through retail dispenser points into a "cute" home version. They've got the cash to take the upfront investment loss to enjoy the long-term profits.

Not only would it lock consumers into a proprietary fizzy water dispensing system, but could see increased profits from higher value/smaller cube distribution in a Peak Cheap Oil world.

Newspapers have shrunk considerably in big markets....same has happened with laundry detergant.....maybe it will happen with fizzy water.

To me at least...any move in that direction by the big players to cut the weight/cube of the product they distribute would be a strong indicator of their belief in a Peak Cheap Oil world.

The same goes if they shift from distributing bottled water to developing/distributing water purification product "subscriptions" of some form or nature.

Just my 0.02c

You have touched on one of my primary consideration points.....

[flintlock]

Re: SodaStream

You have touched on one of my primary consideration points.....

A buyout?

Interesting.

[lakedaemonian]

Re: SodaStream

Pepsi Co acquisition of SodaStream, for $3.2 billion:

https://www.nzherald.co.nz/business/...ectid=12113842

[thriftyandboringinohio]

Re: SodaStream

Maybe they are buying a small competitor to get back a little market share over the long term?

[vt]

Re: SodaStream

If they could ship you just the Pepsi concentrate so you make your own at home, they'd save huge transportation and bottling and canning costs of their current containers on grocers shelves. Plus they sell all the other drink formulas and have a competitive advantage over Coca Cola and others where you can't do it your self.

They would also get praise for being more "substainable" to the envoronment.

[thriftyandboringinohio]

Re: SodaStream

Brilliant! You found it vt.

[BK]

Re: SodaStream

http://www.pepsico.com/sustainability

[dcarrigg]

Re: SodaStream

If they could ship you just the Pepsi concentrate so you make your own at home, they'd save huge transportation and bottling and canning costs of their current containers on grocers shelves. Plus they sell all the other drink formulas and have a competitive advantage over Coca Cola and others where you can't do it your self.

They would also get praise for being more "substainable" to the envoronment.

I remember some years ago that coca cola entered into some partnership with Keurig to do something similar. Don't recall what happened with it.

I got a soda stream some years back, probably when this thread started. Still have it. Was a Christmas gift, because I drink a lot of seltzer. But refilling the canisters is more difficult now. Only place around that does it is Staples, and they are often out of stock. When they are not, it is $26 to exchange before tax now, price went up. Says it does 60L, I get more like half of that. Liter bottles at the grocery store go two for a dollar, sometimes cheaper. So it costs more to make it yourself. Barely touched it this last year. Back to buying bottles and cans.