The Amherst Town Board on Monday unanimously approved an exclusive pouring rights contract with Coca-Cola Bottling that is expected to bring $40,000 to $46,000 a year in new revenue to the town.
The agreement, approved in a special meeting, means that Coca-Cola products will be the only non-alcoholic beverages sold at the former Amherst Pepsi Center and the only drink supplier to every other town-owned property, from town parks to Town Hall.
Coca-Cola won the opportunity to sell Coke products at the former Pepsi Center in December, but the board didn't approve the contract until Monday. Last week, Northtown Automotive announced it had won the naming rights to the former Pepsi Center, now temporarily called the Amherst Ice Center. Council members are expected to approve the Northtown naming rights deal at the board's April 12 meeting. Both contracts would be effective May 1.
The pouring rights deal with Coke is a five-year agreement with an option to extend the contract another five years, said Purchasing Director Lawrence Graner. Either side may back out of the agreement after the initial contract term has passed.
Graner said the Coca-Cola pouring rights deal is expected to generate more money on an annual basis than the expired, 11-year Pepsi deal did.
Pepsi had its name on the heavily used ice rink complex from 1998 through 2009, after sealing an agreement for both naming and exclusive pouring rights at the facility for $550,000 over the contract period. The $550,000 included $12,500 a year in noncash marketing for the facility, Graner said. At the time, the agreement was considered far more lucrative than town officials had expected. Since then, however, the facility has built a strong reputation as a host for big regional and national hockey tournaments and as the practice home of the Buffalo Sabres.
Excluding the noncash marketing services that counted toward the value of Pepsi's total contract, the town's pouring rights contract with Coca-Cola generates more money annually for the town, Graner said.
As part of the agreement, Coca-Cola not only gets the rights to exclusively sell its products at the ice rink facility, but also at every other town-owned property that either sells fountain drinks or houses vending machines.
When combined with the Northtown Automotive naming rights deal, the town should see about $100,000 a year in new money, town officials said.
Under the pouring rights agreement, the town is guaranteed annual revenue of $15,000 plus $5,900 a year for the promotion of ice events, Graner said. The town also expects to make more than $20,000 a year in commissions from the sale of Coke products, he said.