BUBBLING CONTROVERSY

Amanda Chater

Children are becoming the fat of the land.

Thirty percent of them are overweight, and the finger of blame is frequently pointed at sugary soft drinks and snack foods loaded with fat, sugar and calories.

Schools are also coming under fire for their vending programs that are filled with such products.

Now, many states and school districts are limiting or outright banning their sale in response to concern about rising obesity levels and replacing them with milk, water, juices and fruit drinks, along with more fresh fruit, yogurt and nuts. This trend, along with parental influence, is likely to play a major role in shaping kids' eating habits, which in turn stand to impact retail sales.

Consultants, retailers and school officials agreed that if healthful drinks are made more available, kids will start drinking them more.

Some soda alternatives such as sports drinks, waters and flavored waters are more accepted among younger people, said Jim Hertel, senior vice president of Willard Bishop Consulting in Barrington, Ill. "Kids are already making different choices," he said.

To gain traction, the alternative beverages need to keep their audience in mind, said Mary Molyneaux, president of the Natural Marketing Institute in Philadelphia. Young kids may like beverages with fun colors, games, shapes and riddles on the packaging, for example, but as they get older, they look for products that give them energy and follow the latest fad diet.

Almost all high schools (98%), three-quarters of middle schools (74%) and 43% of elementary schools have vending machines, according to the Centers for Disease Control, Atlanta. They're there because they provide revenue for the schools, but unlike food-service programs, they're not bound by federal nutrition standards.

According to the Center for Science in the Public Interest, a vocal opponent of soda and junk food sales in schools, 75% of the beverages and 85% of the snacks sold in school vending machines are of poor nutritional value. Seventy percent of the drinks are sugared, such as soda, and of the sodas, only 14% are diet. Of 9,723 snack slots in the vending machines it surveyed last year, just 26 contained fruits or vegetables.

The American Beverage Association in Washington has called for a voluntary ban on many non-nutritious beverages. Under the new policy, elementary schools will only sell water and 100% juice; middle schools will serve nutritious/low-calorie drinks such as water, 100% juice, sports drinks, calorie-free soft drinks and juice; and in high schools, no more than 50% of the vended beverages will be soft drinks. The ABA's companies comprise about 85% of school vending beverage sales by bottlers.

Kathleen Dezio, spokeswoman for the ABA, said there should be variety for older kids: "You need to trust them at that age to make their choices."

When sodas are available, they become the beverage of choice, though, and kids don't get enough calcium, said Ruth Jonen, president of the School Nutrition Association in Alexandria, Va. "Anything in moderation is OK."

Just as cultural views on smoking and wearing car seat belts have changed, so, too, can children get used to the idea that sodas don't belong in schools, she said. "Kids need education. They need to know how this affects their current and future health, and I think banning an item from a particular venue will make a huge difference."

It's not clear whether school bans will have an immediate impact on food retailers. Convenience stores, because they offer products for immediate consumption and tend to be closer to schools, are likely to benefit when kids look elsewhere for these products, Hertel said.

This is only true, however, for open-campus schools, which are in the minority. Just 3% of elementary and middle schools and 26% of high schools let their students leave campus during the school day.

Tom Pirko, president of Bevmark, a consulting firm in Santa Ynez, Calif., said retailers would be smart to promote the products that are being excluded from schools. If kids can't buy beverages in one venue, they'll find them somewhere else. "They should target kids [rather than parents] with these products because kids are making the decisions now," he said.

Changes in school vending policy will start to influence parents' buying habits, however, and retailers should capitalize on this by changing their beverage assortments, said Gus Valen, chief executive officer of The Valen Group in Cincinnati, a food and beverage consulting company.

If retailers heavily promote sodas, they'd be going against the legislative direction, he said. "They need to be careful about how they mix their commerce and their ethics. We all know people are going to continue to buy sodas, but they might not want to stick their head above ground."

School Rules

Thirty states have passed or are considering laws limiting soda and junk food sales in school vending machines.

State: Law Passed or Law Pending; Key Characteristics

Alaska: Law Passed; Non-nutritious foods banned in elementary schools.

Ariz.: Law Pending; Sets nutrition standards, bans junk food.

Calif.: Law Passed and Law Pending; Junk food, soda banned in elementary and middle.

Conn.: Law Passed and Law Pending; Junk food, soda banned in elementary and middle.

Fla.: Law Passed; No non-nutritious foods.

Hawaii: Law Pending; Sets standards for nutrition, phys. ed.

Ill.: Law Passed; Non-nutritious foods banned.

Ind.: Law Passed; No vending in elementary during the day.

Iowa: Law Pending; State to study soft drink sales in schools.

Kan.: Law Pending; Junk snacks banned in middle and elementary.

Ky.: Law Passed and Law Pending; Proposal would toughen non-nutritious foods ban.

Md.: Law Pending; Sets standards for nutrition, P.E.

Mich.: Law Passed; Non-nutritious foods prohibited.

Miss.: Law Passed; Only healthy drinks, non-processed snacks allowed.

Mont.: Law Passed; Junk food banned.

Neb.: Law Passed; Healthy snacks coming.

N.H.: Law Passed; No junk food.

N.J.: Law Passed; Junk food, drinks limited in middle, high schools.

N.M.: Law Passed; Junk snacks limited in middle, high schools.

N.Y.: Law Passed; Junk food prohibited.

N.C.: Law Passed; Junk food prohibited.

N.D.: Law Passed; No junk foods.

Okla.: Law Passed; No non-nutritious foods in elementary and middle.

Ore.: Law Passed; No non-nutritious foods.

Penn.: Law Passed; Sets standards for nutrition, P.E.

R.I.: Law Pending; Sets standards for nutrition, P.E.

Tenn.: Law Passed and Law Pending; New law will require all food be healthy.

Texas: Law Passed; Limited soft drinks can be sold from vending.

Va.: Law Pending; Establishing standards for nutrition and P.E.

W.Va.: Law Passed; Junk food limited in high schools.

Sources: Aug. 8 Smith Barney report compiling USDA Food & Nutrition Service and National Conference of State Legislatures data; SN research.

They Are What They Drink

Juice and soda rank high on kids' list of favored beverages; vegetable juices do not.

Total %; Boys %; Girls %

Other juice/lemonade: 93; 91; 94

Other soft drinks/soda pop: 90; 90; 91

Orange juice: 84; 83; 85

Regular cola drinks: 82; 81; 84

Milk: 76; 77; 75

Powdered soft drinks: 59; 59; 60

Instant hot cocoa mixes: 53; 50; 56

Pre-packaged milkshakes: 13; 12; 14

Tomato/vegetable juice: 7; 6; 7

Liquid breakfast: 6; 5; 6

Source: Mintel/Simmons Kids Spring 2003 Survey. Base: 2,392 kids aged 6 to 11.

Got Milk?

Many schools worry about the revenue they'll lose if they pull soda and junk food from vending machines. At least two districts report increased sales since they switched to more nutritious options, however.

In the 2001-'02 school year, Vista Unified School District in San Diego limited sodas to 20% of vending slots from 66% and placed them below more healthy choices. At the end of the 2002-'03 school year, soft drinks were eliminated from the machines. Vending sales are now running $345,000, almost double what they were in the first year of the switch, said Enid Hohn, director of child nutrition services for the district. The best-sellers? Bagels with low-fat cream cheese, cut-up fresh fruit and water.

McComb School District in Mississippi also saw no loss in revenue when it stopped vending soda and junk foods, said Carolyn P. Whitehead, the health and physical education coordinator there. "School administrators need to know that there's no downside to supporting better nutrition in schools," she said.

Kids may squawk, at least initially, when their school vending machine no longer carries their favorite sugary soda or snack. It's unlikely the schools will suffer, though, consultants said.

"The schools probably won't lose any money because they're quite willing to switch over to other [products] to keep their contracts," said Tom Pirko, president of Bevmark, a consulting firm in Santa Ynez, Calif.

The big carbonated soft drink makers also are unlikely to suffer from school soda bans because the replacement beverages will come from the same companies, Pirko said.

Indeed, Los Angeles Public Schools has announced a five-year, $26-million deal with Pepsi, which calls for it to provide juice, water and other drinks -- but no soda -- to its 747,000 students.

"Power and energy drinks will be the winners in the vending machines," predicted Pirko. "Teenagers are driven by hormones and care about how they look, and those drinks carry a message."

Nutrition experts voice concern that many of the new drinks can be just as high in calories, sugar and caffeine as the sodas they replaced. New York City schools, for one, replaced soda with a reformulated, lower-calorie Snapple, however. If it were up to Alice Jo Rainville, who teaches nutrition at Eastern Michigan University in Ypsilanti, though, all children would be encouraged to drink more milk.