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For some, soft drink price spike tough to swallow

Many customers balk at beverages. Southwest Florida restaurateurs walk a fine line balancing soaring soda costs with other increases.

Fort Myers, Florida (News-Press) -- Diners are guzzling more than just fizzy sodas when they eat out.

Often they are washing down a hefty price tag along with it.

Soda and soft drink prices at Southwest Florida restaurants have crept over the $1.50 mark in the past few years, with some menus selling sugary soft drinks for $3 or more. Rising food and fuel costs are driving up prices along the soda pipeline from national soda companies and bottlers to food distributors and restaurants.

Increased costs for product, labor and transportation make it more expensive to make and deliver the goods, said chef Eddie Vozzella, general manager at University Grill in south Fort Myers.

"You think it's just sugar and water, but it's making the product," he said. "It costs a lot of money to get the product to your door."

Every year the restaurant sees an automatic price increase from the soda companies, Vozella said.

University Grill has a high volume of soda sales in the lunch crowd, and since 1997 has increased its prices by 25 cents every few years to keep overall restaurant costs in line, he said.

Today, a soda at the restaurant goes for $2.50.

Soda has gotten a bad rap of late, labeled as the culprit behind obesity and diabetes among Americans. Recently its infamy reached new heights when New York City's Board of Health passed a "soda ban," in September limiting any establishment with a food service license to sell sodas in cups larger than 16 ounces. Pending any potential lawsuits, the ban will go into effect in March.

More variety

Despite the extra attention, soda sells and soft drink companies are offering more products everyday.

The going rate for a glass of soda at full-service restaurants across the U.S. averages at $2.61, up from an average of $2.28 in 2007, according to Technomic's MenuMonitor database, a record of menu trends updated quarterly by the food service research and consulting group based in Chicago.

For limited-service restaurants and the top chains around the nation, increases haven't been as high. Prices for a medium drink average at $2.22 for top chains and at $1.79 at limited-service restaurants such as fast-food and quick-service food joints.

"Food prices in the past five years have gone up about 6.5 percent, and then just looking at soda and fountain drinks - not other kinds of drinks like lemonades - they've gone up about 13 percent," said Bernadette Noone, senior director of product management at Technomic.

Increases in soda prices and soft drink prices doubled in comparison to increases in other food costs, but while the increase in soda prices is greater, it's at a low price point - at a $2 range rather than an $8 range for a menu item - so small changes in price are more noticeable in terms of percentages, Noone said.

As restaurants develop specialty nonalcoholic beverages, such as lemonades and flavored teas, they increase prices on the new specialty drinks and raise prices across the menu to keep beverage prices in line, she said.

"Restaurants do make a good margin on soft drinks, so they want to include them," Noone said. "They really do want to get you to buy the beverage because for them, they may make only 10 cents off of selling a burger, but for a soft drink they may make 40 cents."

Vozella, who manages University Grill, said 35 to 38 percent of the purchase price goes toward actual food costs, the rest goes to pay business expenses such as utilities, rent and employees salaries.

Selling a 14- to 16-ounce soda at the restaurant for $2.50 - what University Grill's contract with Coca Cola suggests - would help bring the total costs of goods down if it sold more soda.

"You're trying to keep that 35 to 38 percent," he said. "You're trying to stay in a range like that, and that's why you look for things like soda to keep you in balance."

But many customers balk at the increased prices and will skip out on soft drinks to get water instead.

San Carlos Park residents Audrey Slone and Maura Chevallier have seen a glass of soda sell for as much as $3.50, but typically it's around $2.50.

"And you're paying $5 for a beer or glass of wine," Chevallier said.

Once in a while Slone says she'll indulge and buy a soda, like she did dining out at Amore Brick Oven Pizza in Gulf Coast Town Center on Monday night, but the rising prices have turned her off. Her soda at Amore was $1.50.

"It could be a good thing because it could force more kids to drink water," she said.

Diners are finding new ways to work around the cost of a soft drink, and the standard of free refills and waters at restaurants are more challenging to maintain.

Soda sharing

At Luna Rossa Italian Grill at Miromar Outlets in Estero, owner Eve Alves has seen a party of six come in and order two sodas for the table and share while getting refills, she said.

"We've always charged $2.95 for a soda, because we give free refills," said Alves, who has run the restaurant with her husband, Alex, for five years.

While the price may seem high, the restaurant uses bigger 22-ounce glasses to give servers a little more time between table visits. Alves also wanted to keep prices fixed for as long as possible, she said.

Alves said parents will come in and order their children a kid's meal, which comes with a soft drink, and also order the child a juice or a milk. Then parents will drink the soda and order refills, she said.

"A lot more people are drinking water, and we don't charge for water," she said. "I'm giving you a glass of water with ice and a straw and it costs me money to wash it and pay somebody to put it on the table, yet I can't charge someone for water."

Cape Coral resident Jessica Barton recently checked out prices at Chili's: $2.39 for a soda, $3.99 for a beer, and no charge for water, she said.

While the price of a cold cola is still somewhat galling, Barton said it's still less to pay for a soda than almost any other beverage - alcoholic or otherwise - and refills are included. And even complimentary waters aren't free for restaurants themselves since the lemon wedges resting the rims of glasses are an expense, she said.

Mike Silverman, who owns and operates seven Moe's Southwest Grill restaurants from downtown Naples to Cape Coral, said soda syrup for conventional soda fountains cost about $40 when he started in 2004, but now ranges at around $60.

His restaurants also recently raised soda prices by a dime to $1.99, including refills.

"Customers haven't really said anything either way about prices," Silverman said.

A lot of his customers drink teas, and flavored water at his restaurants, he said.

At three locations, Silverman traded in conventional soda fountains for Coca-Cola's new Freestyle Machine - a new soda fountain that carries 100 brands of soft drink including 70 no- or low-calorie options.

"For myself and for other companies that have Coke Freestyles, they are a little more expensive and it costs us more," he said. "There's more maintenance on it and there are more flavors."

But investing in the trendy machine has been a worthwhile expense because it keeps his customers interested and engaged, he said.

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