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Why Are Energy Drinks & New Age Beverages The New Hot Companies?

Jul 15, 2008
Energy Drinks and new age beverages are the hot topics not only in products and sales or in the beverage industry but also in the investment community.

Many energy drinks and new age beverage companies are appearing every day and getting funded to launch their projects.

Now more than ever, with the sale of Vitamin Water for 4.1 Billion Dollars, individuals, investors and companies want to go into the "new age beverages".

So what exactly are new age beverages? Well, this is a new category within the beverage industry that covers the new style of beverages. This new "category" is growing and changing. Before only energy drinks and really new innovative beverages where part of the category. Now the category has evolved and you can include enhanced water, tea's, diet drinks, iced coffee and really, any new drink. Every beverage company want's to be associated with the "new age" category because not just because it's sexier but because the category is growing quicker and investors are looking at it up close.

You have to realize that Vitaminwater is not the first company to get big cash for their brand. There are beverage companies being funded every day, and more being bought and sold from large companies. Many companies that you now think as the market leaders started not long ago as start-ups.

Some of the companies that you see on the news are Fuze, which sold to Coca Cola, Sobe, that sold to Pepsi Cola or Fiji Water that sold as well.

Other companies like Reeds Beverage, Who's Your Daddy, Jones Soda and Hensen with Monster Energy Drink access funding through the public markets. These and many others are public companies traded in the New York Stock Exchange, the Nasdaq or the otc(Over the Counter).

I get a lot of calls from entrepreneurs starting their energy drinks and many more from investors looking to invest in companies or performing due diligence. At the moment I have at least 100 people contacting me every month wanting to know about the New Age Beverage Industry, Energy Drinks, how to get distribution, how to export, how to bottle drinks or to go over business plans or other information. The industry is growing and the category is growing even faster.

Why are these drinks growing at 50% per year or more? Why do we see so many waters, energy drinks, hydrating products, etc. on the market today? The answer is easy. Consumers are demanding more and more drinks. They want drinks for every occasion or part of the day. They want organic drinks, sugary drinks, healthy drinks and every type of drink to fit their personality, and style.

Entrepreneurs and Investors are going into new age beverages because the demand is there and the profits are very high, very high. This is one of the characteristics that are shared all beverages, they all have high profit margins. How high are the margins? Well, you can make up to $24 gross profit per case. Yes, this is for one case. Imagine selling just one truckload of beverages or around 1,600 cases with this profit. Now imagine selling a truck a week!

Some advice before you start your venture:
-Don't just focus on the drink, focus on the whole package (I get a lot of phone calls and emails telling me they have a better tasting drink than Rockstar, Red Bull and Monster Energy Drink).
-No Promotion before distribution. Don't fall into the energy drink promotion trap. Sales and distribution are first.
-Learn your financials. Figure out how much it takes to start and sell your new drink before you go and product 5,000 cases.
About the Author
Jorge Olson is a Beverage Consultant & Entrepreneur & New Age Beverage Expert His company Liquid Brands will take your drink to the next level. Jorge Olson is a Beverage Consultant & Entrepreneur. His eBook is helping Energy Drinks & New Age Beverage companies get started with the basic information they need.
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