Keurig Green Mountain Inc. and Peet’s Coffee & Tea have entered a multi-year manufacturing and distribution agreement for Peet’s-branded packs for the Keurig brewing system. Financial terms of the agreement were not disclosed.
The companies plan to launch a selection of Keurig licensed Peet’s coffee and tea varieties in K-Cup packs for Keurig brewers produced by Keurig by the end of the summer. Peet’s will continue to hand roast the beans for its Peet’s K-Cup packs at its LEED-Gold certified roasting facility in Alameda, Calif., and the roasted beans will be transported to Keurig for grinding and packaging in K-Cup packs.
The new, licensed Peet’s K-Cup packs will be distributed by Peet’s proprietary nationwide direct delivery system to grocery stores, mass merchandisers, club stores, Peet’s retail stores and online at peets.com. Keurig will distribute Peet’s K-Cup packs to specialty and department stores and away from home channels, as well as via its U.S. consumer direct site at keurig.com.
Peet’s entered the single-cup format about seven months ago and has established a strong presence, expanding its distribution and retail sales of its single-cup products, which are now available in more than 12,000 stores nationwide.
“Consumers consistently choose the Keurig brewing system for the quality, simplicity, value and variety of the brands and beverages available in the system,” said Brian Kelley, Keurig’s president and CEO. “We’re thrilled to bring Keurig consumers and Peet’s lovers the choice of Peet’s premium specialty coffees and teas as part of the continually growing Keurig family of brands; hand roasted by Peet’s and expertly packaged in K-Cup packs by Keurig to deliver optimum freshness and taste with the ease of the Keurig brewing system.”
Keurig amends agreement with Starbucks
In other Keurig news, the company has amended its existing five-year agreement with Starbucks Coffee Co.
The companies have updated their agreement to continue to expand Starbucks range of K-Cup pack offerings and to promote expanded consumer choice as Keurig continues to build its Keurig brewing system. In exchange for eliminating the super-premium coffee exclusivity terms of the existing agreement, Starbucks will receive improved business terms, including expanded Starbucks K-Cup packs and variety types.
John Culver, Starbucks group president, China and Asia Pacific, channel development and emerging brands, said, “This amendment advances Starbucks commitment to strengthening its global leadership position in the nearly $8 billion premium single-cup coffee category. With nearly two billion Starbucks K-Cup packs shipped from the inception of our relationship through the end of 2013 this contractual update underscores the appeal of Starbucks to the millions of Keurig brewer owners and the continued innovation and collaboration our relationship reflects.”
Added Mark Wood, SVP of global hot systems for Keurig, “This amended agreement creates more favorable business terms for both companies and allows us to build upon our strong relationship.”
