CANADA SAFEWAY ADDING SODA REFILLERS

RICHARD TURCSIK

CALGARY, Alberta -- Canada Safeway this month is installing in-store soda dispensers that allow customers to bottle their own soda.

The machines are being installed in six of Safeway's 250 stores in Canada, and are the first in Canadian supermarkets. The first machine was scheduled to be installed last week, the second this week and the remaining four before the end of this month.

They can fill one- and two-liter bottles of soft drinks and gallon jugs of water, and are manufactured by Fountain Fresh International, Salt Lake City.

Officials at Canada Safeway were not available for comment on the program.

Otto Cutts, president and chief executive officer of Fountain Fresh, told SN that Safeway will market the soda under the Fountain Fresh name, at prices substantially below national brands. Pricing is geared to offer retailers gross margins between 25% and 50%, he said.

"We've done test marketing in Utah. We started at 59 cents, and went up to 69 cents, but the competition got a little aggressive on us. So we're going to be going in at retail with the refill at 59 cents for a 2-liter bottle.

"In Canada, what you normally do is stay 20 cents below the house brand. That generally translates to anywhere from 60 cents to $1 below the majors," he said.

"We are talking to [other retailers] who are interested in putting their house brand on it," he added.

The machines require a 4.3-feet by 3.5-feet space on the selling floor and a 3-feet by 6-feet space in the backroom, along with a water line, carbon dioxide line and a drain, which can be pumped overhead to eliminate digging up the floor to put a drain in. It uses minimal electricity, costing an average of 0.001 cents per bottle.

"We recommend that it be placed at the end of the beverage aisle in the front of the store, or in one of the corner aisles, depending on where the traffic is," Cutts said. He added that the machines will be located differently in each Safeway store.

Each machine contains four soft drink filling stations and two pure drinking water stations. The dispensers offer up to 24 soft drink selections that can be tailored on an individual store basis from a menu of 40 flavors.

The machine offers two bottle and cap rinse stations and liquid crystal displays with instructions. Customers place an empty bottle on the retractable bottle holder. The bottle is filled with cold beverage, and, when completed, the bottle holder lowers the bottle and the customer places the cap on it. The whole process takes 30 to 40 seconds.

In the United States, Fountain Fresh has soda dispenser machines in four independents, including a Stop & Shop supermarket in Ogden, Utah, that is serviced by Associated Grocers.

Larry Garner, Stop & Shop store manager, told SN that the machine is near the front of his store at the head of aisle one. "The customers seem to like it quite well. At first it attracted new customers to the store, but that has kind of leveled off. I don't think it has had any impact on our sales of bottled sodas," he said.