Peru's Inka Kola gets the taste for fast food alliances

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LIMA -- Peru's Inka Kola, the country's largest selling soft drink, is battling with U.S. giants Coca-Cola and Pepsi for control of the fast food market.

With 35.6% of Peru's soft drink market in June 1997, Inka Kola "is one of the few national soft drinks worldwide that has managed to stay on top of Coca-Cola and Pepsi," says Inka Kola Marketing Director Max Alvarado.

To stay on top - Coca-Cola has increased its market share to 29.9% and predicts a 13% growth for 1997 - Inka Kola has formed strategic alliances with 15 local and international fast food franchises, including McDonald's, a centerpiece of the company's expansion strategy.

Peru is a relative new comer to fast food, with McDonald's, Burger King, Taco Bell and other U.S. giants coming to town only in the past two years. Alvarado says the company's strategy is to capitalize on this new market.

"The alliance with McDonald's is very important to the company, it improves our position and maintains our image as the national soft drink," says Alvarado. "Inka Kola is a symbol of Peru."

The 87-year-old company expects to increase its sales by up to 50% in the next few years thanks to its alliances with fast food franchises.

It is also betting on the continued success of its Inka Kola Diet, which has captured 66.6% of the market in roughly two years. Diet Coke and Pepsi Max each have a 16.6% market share.

Copyright August 1997, Crain Communications Inc.

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