Keurig Dr Pepper
Keurig Dr Pepper Inc., formerly Green Mountain Coffee Roasters (1981–2014) and Keurig Green Mountain (2014–2018), is a publicly traded American beverage and coffeemaker conglomerate with headquarters in Burlington, Massachusetts and Frisco, Texas.[5] Formed in July 2018, with the merger of Keurig Green Mountain and Dr Pepper Snapple Group (formerly Dr. Pepper/7up Inc.), Keurig Dr Pepper offers over 125 hot and cold beverages. The company's Canadian business unit subsidiary operates as Keurig Dr Pepper Canada (formerly Canada Dry Motts).
This article is about the company. For the coffee brewing machine, see Keurig. For the soft drink, see Dr Pepper.Formerly
Green Mountain Coffee Roasters (1981–2014)
Keurig Green Mountain (2014–2018)
- Nasdaq: KDP
- Nasdaq-100 component
- S&P 500 component
- Beverage
- Appliance manufacturing
1981 (as Green Mountain Coffee Roasters)
Waitsfield, Vermont, U.S.[1]
Robert Gamgort
(Executive Chairman and CEO)
-
- Keurig brewers
- K-Cups
- Green Mountain Coffee
- Dr Pepper (US Canada)
- Snapple
- Schweppes (North America)
- 7 Up (U.S. only)
- Sun Drop (U.S. only)
- A&W (Worldwide except Canada)
- Canada Dry
- Canfield's
- Hawaiian Punch (U.S. only)
- Stewart's Root Beer
- IBC Root Beer
- Mott's
- Mr & Mrs T
- Nantucket Nectars
- Nehi
- Vernors
- RC Cola (U.S. only)
- Squirt
- Sunkist
- Yoo-hoo
27,500 (2021)
The company's east-coast division manufactures Keurig brewing systems; sources, produces, and sells coffee, hot cocoa, teas, and other beverages under various brands for its Keurig machines; and also sells coffee beans and ground coffee in bags and fractional packs. As of 2018, the newly merged conglomerate also sells sodas, juices, and other soft drinks via its Dr Pepper Snapple division based in Texas.
Green Mountain Coffee Roasters (GMCR) was established in 1981. After regional and national expansion in the late 1980s, and an IPO in 1993, the company completed its acquisition of the brewing-machine manufacturer Keurig, Inc. in 2006, enabling rapid growth through the high-margin sales of its many varieties of single-serve K-Cup pods. In March 2014, GMCR changed its name to Keurig Green Mountain.
A publicly traded company from 1993 through 2015, Keurig Green Mountain was acquired by a group of investors led by JAB Holding Company in March 2016 for $13.9 billion in cash.[6][7][8][9] Keurig Green Mountain became a privately held company for two years, and was an independent entity run by its pre-existing management team and a new CEO.[10][11][12]
On July 9, 2018, Keurig Green Mountain acquired the Dr Pepper Snapple Group in an $18.7-billion deal.[13] The combined company was renamed Keurig Dr Pepper, and traded publicly again on the New York Stock Exchange under the ticker "KDP" until 2020 when it switched to Nasdaq while retaining the same ticker. Shareholders of Dr Pepper Snapple Group own 13% of the combined company, with Keurig shareholder Mondelez International owning 13% to 14% of that fraction. JAB Holdings owns the remaining 73-74%.[14][15]
In 2021, Keurig Dr Pepper opened its second headquarters in Frisco, Texas.
History[edit]
Beginnings[edit]
Green Mountain Coffee Roasters (GMCR) began when entrepreneur Bob Stiller was near a Vermont ski resort, where he drank a cup of coffee that he enjoyed and looked for its source. In 1981, he and a partner bought a two-thirds stake in the small speciality coffee roasting company in Waitsfield, Vermont, that produced the roasted beans.[16] The store and cafe sold beans, grounds, and coffee to the public and a few restaurants.[17] Stiller dedicated himself to coffee-roasting, using arabica coffee beans.[18] By 1982, the company had around 30 employees, and moved its production facilities to Waterbury, Vermont.[19]
Stiller bought out his two partners for $100,000 and became sole proprietor of the company within two years of his original purchase,[16] but it took four years to turn a profit.[16][17] To grow the business, Stiller sold the coffee to high-end restaurants and gas stations alike, and gave out free samples as he could not afford advertising. In 1986, he launched a mail-order business which he advertised in gourmet magazines, and acquired his first supermarket-chain customer, Kings.[19]
Stiller adopted technology to track customers' orders; to regulate roasting-heat levels appropriate to each bag; and to track distribution, manufacturing, sales, and personnel (adopting PeopleSoft in 1997).[16] By 1983, employees composted used coffee grounds at its retail stores, and by 1986, Green Mountain introduced its first organic coffee in a retail market test.[19] The company became one of the largest suppliers of double-certified fair-trade and organic coffee in the world.[20][21]
As American tastes in coffee changed, sales of Green Mountain roasted coffee beans grew.[18] In 1991, GMCR had seven retail outlets, 1,000 wholesale clients, $11 million in sales, and $200,000 in profits.[17] By 1993, the company had 2,400 wholesale accounts and sales of about $10 million,[17] and Green Mountain Coffee Roasters, Inc. started trading publicly, under the ticker "GMCR". The company expanded its retail locations, food-service distribution, mail-order business, and wholesale business.[17]
In 1994, Green Mountain began exporting to Canada and Taiwan.[17] In the late 1990s, it broadened its national supermarket chain distribution, gas-station and convenience-store distribution throughout the northeast, and it sold its product on airlines and Amtrak, specialty coffee stores, and venues such as LL Bean, Weight Watchers International, and Staples.[17][19]
Keurig and launch of K-Cups[edit]
In 1993, three engineering entrepreneurs from a Massachusetts start-up called Keurig approached GMCR about developing a single-cup coffee brewing system, marking GMCR's first investment in Keurig.[19][22] In 1996, GMCR invested further in Keurig, buying a 35% interest in the company.[16][23] The following year, GMCR became the first roaster to offer coffee in a K-Cup pod for the Keurig Single-Cup Brewing System;[19] in 1998 Keurig delivered its first brewing system, designed for office use.[24] The launch of the first K-Cups with Green Mountain Coffee helped GMCR begin to further compete with Starbucks by allowing people to brew their own single servings of premium coffee.
Also in 1997, a deal with Poland Spring opened the office-worker market by distributing Green Mountain Coffee to thousands of offices in the Northeast.[17] In 1998, GMCR closed its 12 retail shops in favor of the burgeoning direct-mail and online market, its growing distributions to business offices and other national venues, and its wholesale market.[16][17][25] That year, the company signed an exclusive deal with American Skiing Company, offered its first corporate gifts catalogue, sold its certified organic coffee in ExxonMobil's national and international On the Run convenience stores, and expanded its supermarket distribution to 500 stores.[17] In 1999, it expanded its export market, including to Great Britain.[17]
In 2000, Green Mountain reached an agreement to promote and sell fair trade coffee, committing to making at least 3% of its sales fair trade—certified by TransFair USA.[25][26] In 2001, the company acquired Frontier Organic Coffee,[27] and in 2002, it signed an agreement to sell fair trade coffee under the Newman's Own Organics label.[28] In late 2005, GMCR reached a deal to sell its Newman's Own Organics Blend coffee in more than 600 McDonald's restaurants in New England and Upstate New York.[29]
Acquisition of Keurig, Inc.[edit]
In 2006, Green Mountain had a 43% ownership of Keurig, Inc, which it accomplished by successively investing in and acquiring increasing percentage ownership the company between 1993 and 2003, helping to complete its full acquisition of the single-cup brewing systems manufacturer.[23] The subsequent acquisition allowed Green Mountain to adopt a multi-brand portfolio, and multichannel distribution of brands in a variety of settings.[30] It also fuelled substantial revenue growth, and allowed GMCR to transition fully from deriving 95% of its revenue from its low-margin wholesale coffee business in the late 1990s (approximately $65 million), to deriving 95% of its revenue from high-margin sales of K-Cups as of 2014 (more than $4.3 billion).[31]
Green Mountain also acquired the four additional Keurig licensees in 2009 and 2010:[32][33]
Corporate affairs[edit]
Sustainability[edit]
GMCR began to embrace an environmental ethos within two years of its founding, and environmentalism and sustainability were important policies for which Green Mountain became well known. Among other initiatives within Green Mountain's first decade, in 1983 employees began composting used coffee grounds at its retail stores; in 1986 the company introduced its first organic coffee in a retail market test;[19] in 1989 it formed an Employee Environmental Committee, and began a recycling program;[19] and in 1990 it introduced Rain Forest Nut coffee to sponsor rainforest preservation, donating 10% of the product's profits to Conservation International and the Rainforest Alliance, and it introduced the first earth-friendly, oxygen-whitened, dioxin-free coffee filters.[19] In 1992 it formed a Stewardship Program to promote sustainability and sound environmental practices;[19][85][86] in 1997 it pioneered the first biodegradable bag for bulk coffee purchases;[19] and in 2006 it introduced the ecotainer, a to-go cup for hot beverages made entirely out of renewable materials.[87][88]
In 2005, Green Mountain was the first coffee company to support the United Nations' Global Reporting Initiative mission to develop globally accepted sustainability reporting guidelines.[89] In 2008 GMCR's board of directors added a social and environmental responsibility committee.[89] During that time period GMCR also established a vice president for environmental affairs reporting directly to the CEO.[89] As of 2015, Keurig Green Mountain has a Chief Sustainability Officer.[90]
The company offsets 100% of its direct greenhouse gases,[91] and prioritizes waste reduction and responsible energy use, and sustainability over the life-cycle of its products.[87][92][93] In addition to other awards and recognition for sustainable practices,[94] GMCR was on Sustainable Business's "World's Top 20 Sustainable Business Stocks" annually from 2002 to 2007, and as of 2015 it is on the EPA's National Top 100 of green power users in the U.S.[95][96][97][98][99] In 2014, Keurig Green Mountain announced a multi-faceted effort to address the long-term challenges of the global water crisis, and instituted an initial commitment of $11 million to support nonprofits working to promote water security.[100]
Environmental advocates and journalists have criticized the company for the billions of non-recyclable and non-biodegradable K-Cups consumers purchase and dispose of every year,[101][102] and for the dichotomy between the company's historic environmentally conscious image and the impact of K-Cups on the environment.[103][104][105][106][107] In 2015, the company's chief sustainability officer stated that every new K-Cup spin-off product introduced since 2006 – including the Vue, Bolt, and K-Carafe cups – is recyclable if disassembled into paper, plastic, and metal components.[108] In its 2014 Sustainability Report, released in February 2015, Keurig Green Mountain re-affirmed that a priority for the company is ensuring that 100% of K-Cup pods are recyclable by 2020.[92][93][109][110][111]