OC’s Drink Contract In Last Year

OCEAN CITY – It’s no secret that Ocean City’s official soft drink is Pepsi, but within the next year the opportunity for a change in the town’s beverage franchise will be presented.

According to Recreation and Parks Director Tom Shuster, Ocean City’s current beverage franchise contract with Pepsi is set to expire April 1, 2012. In the past, the town has used a Request for Proposals (RFP) method for soliciting interest in the beverage franchise and suggested to the Mayor and City Council for the same procedure to be used again.

Shuster explained that an RFP has been conducted twice in the past and the current contract was set to fulfill five years expiring in April.

Items covered in the RFP by the perspective bidder include exclusive beverage rights to sell products in all of the town’s venues, the installation of vending machines in various locations around town, affiliation with Ocean City in marketing and contributing products for use in the town’s programs and activities.

The franchise will have to offer the town an annual fee, a commission rate to the town for the sales of beverages through the vending machines or at any other locations, and also offer support in terms of distribution and marketing in various promotions and activities linked to the franchise holder during the course of the contract.

There are a couple changes being contemplated this time around. One is to exclude the Dew Tour from the contract. The Dew Tour is a new event that was held in Ocean City this past summer that features competitions in skateboarding, BMX, skateboard bowl, and surfing. Pepsi is the tour’s title sponsorship.

“Let’s say a company other than Pepsi won the bid, it would create a binding problem for us,” Shuster said.

Shuster said another change being considered is adding a clause to the contract that would exclude one main event, for example the OC Air Show, to be decided by the town each year.

The collection of revenue generated from the partnership with a beverage franchise is done by the town’s finance department. A summarized value was conducted of the current five-year contract with Pepsi and based on vending commission the town has collected about $14,000 a year.

The City Council voted unanimously to approve Shuster’s request to prepare an RFP for the new beverage franchise that would be distributed to prospective bidders in November with a bid opening likely in December.