Why Coke Cost A Nickel For 70 Years
by David Kestenbaum
November 15, 2012 4:00 AM
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Always Five Cents
1905: An oilcloth sign. The Coca-Cola Company
1907: Change receivers like this one were used at cash registers to hold change made for customers. The Coca-Cola Company
1922: A print ad in the Saturday Evening Post. The Coca-Cola Company
1936: An ad highlighting 50 years of Coca-Cola. The Coca-Cola Company *
1941: Cardboard cutout easel display. The Coca-Cola Company
1943: A large cardboard subway sign. The Coca-Cola Company *
1945: A cardboard easel sign for Woolworth. The Coca-Cola Company
1950. The Coca-Cola Company
Prices change; that's fundamental to how economies work.
And yet: In 1886, a bottle of Coke cost a nickel. It was also a nickel in 1900, 1915 and 1930. In fact, 70 years after the first Coke was sold, you could still buy a bottle for a nickel. Three wars, the Great Depression, hundreds of competitors — none of it made any difference for the price of Coke. Why not? In 1899, two lawyers paid a visit to the president of Coca-Cola. At the time, Coke was sold at soda fountains. But the lawyers were interested in this new idea: selling drinks in bottles. The lawyers wanted to buy the bottling rights for Coca-Cola. The president of Coca-Cola didn't think much of the whole bottle thing. So he made a deal with the lawyers: He'd let them sell Coke in bottles, and he'd sell them the syrup to do it. According to the terms of the deal, the lawyers would be able to buy the syrup at a fixed price. Forever. Andrew Young, an economist at West Virginia University, says the president of Coke may have signed the contract just to get the guys out of his office. "Anytime you've got two lawyers in your office, you probably want them to leave," Young says. "And he's saying, 'I'll sign this piece of...