The National Impact Of NYC’s Soda Ban

Will restrictions on the sale of high-calorie sodas slow distributors’ sales?

CO2 Beverage GasOn September 13, 2012, New York City’s Board of Health approved a ban on the sale of non-diet sodas and other high-calorie drinks larger than 16 ounces. The ban, which goes into effect in March 2013, affects restaurants, movie theaters, sports venues and other eateries. And with consumption of these carbonated drinks expected to decline, it could have an impact on gas distributors as well.

New Yorkers are quick to debate whether the so-called “soda ban” introduced by Mayor Bloomberg will be effective in its goal of fighting obesity; and while the effectiveness of the ban is not germane to our industry, the perceived flaws of the ban are.

One New York distributor president who asked not to be named says, “I imagine people who normally drink massive-sized sodas are just going to buy two.” As a result, the distributor does not believe their company’s beverage gas sales will be affected by the ban when it is introduce in March.

To this New Yorker’s point, while the ban does limit the size of the cup a restaurant can provide, it does not restrict the sale of refills on fountain drinks. Also in distributors’ favor is the fact that the ban does not apply to diet sodas and alcoholic beverages. Drinks sold at grocery stores and convenience stores will also not be impacted.

However, if there is anything to be gleaned from the beverage industry’s reaction, perhaps distributors should be concerned—and not only those in the Big Apple. The food-industry-sponsored group New Yorkers for Beverage Choices has already spent more than $1 million campaigning against Bloomberg’s soda ban, according to The New York Times. Officials in the soft drink industry say they will do whatever it takes to fight the ban before it goes into effect next March.

Why? The New York Times says beverage companies are fearful that the move to limit soda sizes could turn into a larger, national trend. If other cities follow suit, distributors across the country could be in for a shock.

How big could this thing become? NuCO2 (Stuart, FL) estimates that there are around 625,000 restaurants across the country serving fountain soft drinks. Add in thousands of movie theaters, sports arenas, concession stands and food carts, just to name a few, and the stakes continue to become greater.

Just how important is CO2 to sporting events? Take Lucas Oil Stadium, the home of the NFL’s Indianapolis Colts and the 2012 Super Bowl, for example. David Frick, president of the Lucas Oil Building Authority, has called the stadium’s CO2 cylinder room “the most important room in the building.”

As for the impact of the impending soda ban in New York City, only time will tell what the larger impact will be on distributors of carbon dioxide and CO2 equipment.

What do you think: will the soda ban slow carbon dioxide sales? If so, what can be done about it?

Gases and Welding Distributors Association