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Pouring Rights ContractOn October 26, 2000, the Hyde Park Central School District Board of Education approved a Pouring Rights contract with Pepsi-Cola of the Hudson Valley. This agreement provides that beverage distributor exclusive rights to sell packaged beverages (carbonated and non-carbonated) and premix tanks on school property. In exchange, Pepsi-Cola of Hudson Valley will pay a commission to the District on its vending sales and will provide packaged beverages, premixes and carbon dioxide at a discount to school related activities. As with any procedural change such as this, there is bound to be some confusion and some questions. This site is intended to answer some of those questions. If your question is not answered here or not answered to your satisfaction, please contact the Assistant Superintendent for Business, Lorelei Case, at or .
What is a Pouring Rights Contract?A Pouring Rights contract is an agreement between a beverage distributor and an organization that allows the distributor to be the only one selling beverages at a given location. The beverage distributor generally also requires that the organization does not endorse a competitor's product through the posting of logos or advertising. In return, the distributor pays a commission on each sale to the organization and may even guarantee a minimum commission per year. Frequently the distributor may offer other inducements in order to be selected, such as providing athletic equipment or other donations. With whom do we have a Pouring Rights Contract?Pepsi-Cola of the Hudson Valley How long is our contract?5 years Why was Pepsi picked?Only two distributors submitted bids: Pepsi-Cola of the Hudson Valley and Coca-Cola enterprises. Based on commissions paid to the District, level and type of service and non-monetary considerations, Pepsi-Cola of the Hudson Valley was selected as the better offer from the District's perspective. What does the District get out of it?Pepsi-Cola of the Hudson Valley will pay a 40% commission on vending machine sales. This is estimated as $37,000 this first year and commissions will be paid at the start of the year (based on projections). Pepsi-Cola of the Hudson Valley has also donated the new football scoreboard at the High School and will donate $1,000 worth of product per year for use in fund-raisers or other school events. Finally, supplies for events will be available to school related organizations at a substantial discount and the distributor will load dispensing units and coolers for events. In addition, the Mountain Dew Hummer and the Lipton Iced Tea Truck can be scheduled for events. Are there any non-monetary benefits?Pepsi-Cola of the Hudson Valley has also donated the new football scoreboard at the High School and will donate $1,000 worth of product per year for use in fund-raisers or other school events. Will Pepsi maintain the new scoreboard?Yes. Pepsi-Cola of the Hudson Valley is responsible for the maintenance and repair of the scoreboard. Can we get new scoreboards for other sports out of this?The Pouring Rights contract was negotiated to maximize our financial benefit so non-monetary benefits were minimized. Other scoreboards or other equipment could be purchased with the commissions, however. What are our obligations?All of the beverage vending machines have been replaced with vending machines that are the property of Pepsi-Cola of the Hudson Valley and only their products will be sold from them. In addition, the District must ensure that only products obtained from Pepsi-Cola of the Hudson Valley are sold at events occurring on school grounds. Such beverages include carbonated softdrinks, frozen carbonated and non-carbonated beverages, naturally or artificially flavored fruit juices and fruit juice containing drinks, fuit-flavored drinks, ready to drink tea products, hypertonic, isotonic and hypotonic drinks, sports drinks and bottled water. Beverages not covered by the contract include fresh brewed coffee and tea, milk, unsweetened juice in 4oz or smaller packages, water drawn from a public water supply and fresh-squeezed juice. In addition, the District cannot promote or display a competitor's logo and the cups used by sports teams for sports drinks must be approved by Pepsi-Cola of the Hudson Valley. What if I don't like Pepsi?Students, employees and others are free to bring competitive products on school grounds for personal consumption only. They cannot be resold on school grounds. Students, employees and others are also free to display competitors' logos on personal property (clothing, vehicles,etc.) Where does the money from vending sales go?40% of the vending machine sales is being paid to the District by Pepsi-Cola of the Hudson Valley as a commission. Of that money, 20% will be reserved by the District for miscellaneous and contingency expenses. For example, during this first year the money is being used to fund field trips. The remaining 80% will be allocated back to the buildings and distributed according to the vending machine sales of the previous year. That is, each principal will receive 32% (80% of 40%) of the sales from the vending machine(s) in her or his building. The principal will determine how that money is spent in her or his building. Are other logos banned?Students, employees and others are free to display competitors' logos on personal property (clothing, vehicles,etc.) My group used to get money from a vending machine. How do I get my money now?The intent is that the distribution of the profits from vending machine sales reflect what was previously realized by the groups sponsoring the machines. However, the distribution is up to the individual principals. Is my group guaranteed a 'cut' of the vending machine profits?No. First of all the Superintendent, with the approval of the Board of Education, can decide to reserve the profits from vending machine sales for another purpose. Second, building principals are free to distribute the money in whatever manner best suits their schools. What beverages can be sold at an event?Only beverages obtained from Pepsi-Cola of the Hudson Valley can be sold at events held on school grounds. This includes canned and bottled softdrinks, bottled water and soda 'on tap'. Can I have any other beverage at a school event?Other beverages can be served at a school event if they are not sold. How are beverages for an event obtained?The sponsoring organization should contact Pepsi-Cola of the Hudson Valley directly and make arrangements for supplies. Call Kathy Goulden at 562-5400 ext 410 or Rich Ryan at 562-5400 ext 414 to make arrangements. How far ahead of time should beverages be ordered?At least 2 weeks What is the profit on beverages sold at an event?Organizations deal with Pepsi-Cola of the Hudson Valley directly and profit is based on their selling price. Cost to the organization is as follows:
Bottled and canned drinks include Pepsi, Diet Pepsi, Caffeine Free Pepsi, Diet Caffeine Free Pepsi, Pepsi ONE, Mountain Dew, Diet Mountain Dew, Sunkist Orange, 7up, Diet 7up, Cherry 7up, A&W Root Beer, Welch's Grape, Schweppes Ginger Ale, Lipton Iced Tea, Hawaiian Punch, Sunny Delight and assorted 12oz juices. Premix tanks include Pepsi, Diet Pepsi, 7up, Mountain Dew, Orange, Root Beer, Ginger Ale, Club Soda and Tonic Water. How is the money for an event sale handled?The organization deals directly with Pepsi-Cola of the Hudson Valley. Charges are billed through account 27768 to the attention of the organization. The organization is responsible for paying for the original product and keeps any profit they made. Does the District take a cut of the profits from beverages sold at an event?No What if I have leftover product after an event?Pepsi-Cola of the Hudson Valley will take back any unused full cases or full tanks for full credit. They will not take back partially used tanks and cases. |
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