In return for giving a beverage manufacturer exclusive access to children at a particular school (pouring rights), the school gets a percentage of sales and sometimes extras such as signing bonuses, equipment, scholarships and internships. Coca-Cola and Pepsi both offer this sort of deal in return for installing their vending machines into schools. Often schools are given a financial incentive to sell as much soft drink as they can so that the schools actively promote soft-drink consumption.
In one well-publicised example in 1998, a Colorado school district official sent a letter to schools instructing principals to let students have free access to Coca-Cola vending machines all day and even to let students drink Coca-Cola in class, in order for the district to receive a bonus payment for the sale of 70,000 cases of Coke in a year.
In another school district the contract required the school to sell the equivalent of 1.6 cans of Coke per pupil every day for ten years.
In 1999 it was noted in Beverage Industry magazine that it was important to get elementary school children drinking soft drinks because at that age they “are still establishing their tastes and habits”. By 2001 soft drinks, or soda, had “become a staple food for American children” with teenage males drinking more than two 20 oz cans per day.
This increased consumption of soft drinks not only raised the incidence of obesity but, because it often replaced milk, increased the incidence of osteoporosis and bone fractures as a result of low levels of calcium; increased the incidence of dental cavities because of the acidity of the drinks; and increased classroom behavioural problems because of the caffeine in cola drinks. The money gained by schools for these contracts is therefore at the expense of the long-term health of the school children.
Reference: Alex Molnar, ‘The Ninth Annual Report on Schoolhouse Commercialism Trends: 2005-2006’, Tempe, AZ, Commercialism in Education Research Unit (CERU), Arizona State University, November 2006, p. 3375 percent of high schools have exclusive agreements with beverage companies for vending machines.
Reference: Samuels & Associates, ‘Food and Beverage Marketing on California High School Campuses Survey: Findings and Recommendations’, Public Health Institute, March 2006A Public Health Institute survey of Californian schools found 276 vending machines in the 19 schools it visited. These machines were located in areas frequently trafficked by students such as cafeterias and courtyards.
Reference: Alex Molnar, ‘The Ninth Annual Report on Schoolhouse Commercialism Trends: 2005-2006’, Tempe, AZ, Commercialism in Education Research Unit (CERU), Arizona State University, November 2006, p. 4356 percent of high schools have exclusive agreement with soft drink manufacturers.
Reference: ‘Briefing on School's Role in Promoting Child Health and Combating Commercialism’, National Union of Teachers, 9 November 2004, p. 1.Vending machines selling soft drinks, crisps and sweets can earn English schools the equivalent of two teachers’ salaries.
Reference: ‘Advertising in Schools’, Times Education Supplement, 25 June, 2004.Branded vending machines have been banned in Scotland and Wales.
Legislation to stop in-school marketing of junk foods has been resisted in the US for several years now. Coca-Cola hired Holland & Knight to lobby against the federal Better Nutrition for School Children Act of 2001 which would have prevented soft drinks from being sold or provided as part of school lunches.
As opposition to pouring rights contracts grew in the US in 2003, Coca-Cola became a sponsor of the National Parent Teacher Association (PTA).
In 2001 the Captive Audience/Stop Commercialism in Schools Act was defeated in Maryland after school administrators, who wanted the money that came from commercialisation, joined with vending machine lobbyists and other companies with vested interests, to oppose the measure. It was defeated the day after Coca-Cola announced a commitment to scale back on its marketing in public schools.
Further efforts to legislate against junk food in schools were defeated by Coca-Cola and other junk food lobbyists in Connecticut, Arizona, New Mexico and Oregon during 2005.
By 2006 38 states were trying to bring in legislation to regulate food in schools, and particularly vending machines and 14 states had passed such laws. Beverage companies were also under threat of legal action by the Center for Science in the Public Interest (CSPI) for promoting and selling unhealthy products in schools.
Consequently, in 2006 Coca-Cola, PepsiCo and Cadbury Schweppes, which “control more than 90 percent of school sales” announced that they would phase out sweetened drinks from schools and eventually only sell bottled water, low-fat milk and pure fruit juice in elementary schools, with the addition of diet sodas and sport-drinks in middle and high schools.
Similar voluntary agreements were made in Canada and NSW, Australia in 2004 in the wake of government efforts to ban them, although in these cases, soft drinks would still be sold in high schools.
Such agreements allow the companies to continue promoting their brand. Winning brand loyalty from a new generation is more important to soft drink companies than actual school sales, which make up less than one percent of total sales in North America.
Moreover, schools trying to get out of contracts with these soft drink companies are finding it too expensive because of contract penalty clauses effectively rendering the voluntary industry agreement ineffective for the term of their contracts which can be up to ten years.
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