Companies and Brands
Keurig's New Technology Can't Keep Pirates at Bay
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It was a nice try, but it does not appear to have worked. The CEO of Treehouse Foods Inc. (NYSE: THS), the largest of the private-label companies that produce pods for the original Keurig machine, said in June that it would take “months, not years” to replicate Keurig’s technology.
It apparently took less than three months, and it was another Keurig competitor, Mother Parkers Tea & Coffee, that announced it will launch a new version of its own pods that are compatible with the Keurig 2.0 brewing machine.
About 14% of the market for single-serving pods is made up of Keurig competitors. The total global market size for single-serving coffee pods is around $9 billion and margins are extremely rich. A pound of coffee that sells at retail for about $13 could be split into pods and retail for more than $50. The convenience of a pod is worth $37 a pound? Go figure.
Keurig Green Mountain’s shares traded up about 0.3% at noon on Friday in a 52-week range of $56.87 to $136.91.
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