Pepsi, Starbucks plan expansion of Tazo tea distribution

PURCHASE, N.Y. and SEATTLE PepsiCo and Starbucks have said that they will distribute Tazo bottled iced teas more widely beginning this fall. The move comes as a response to slowing U.S. sales of carbonated soft drinks and a move on Pepsi’s part to boost bottled beverage sales.

The two companies said they plan to give Tazo ready-to-drink teas more exposure and expand their presence beyond Starbucks coffee shops by making the teas available across the United States by mid-October.

Additionally, Starbucks, PepsiCo and Unilever will make and sell Tazo drinks, expanding on a distribution partnership already in place to handle and distribute Lipton teas.

According to the Nielsen Company, ready-to-drink tea sales grew by 6.6 percent for the year ended in July—a slowdown from three years prior. But analysts predicted that the slowdown was due more in part to lighter consumer spending of late, and they said that tea sales were likely to blossom again, once the U.S. economy rebounds.