5 Dumbest Things on Wall Street: Nov. 20

5. Costco Flattens Coke

NEW YORK (TheStreet) -- Sorry, Costco (COST) (Stock Quote: CSCO) customers. No Coke, Pepsi (PEP) (Stock Quote: PEP)!

Costco confirmed Monday that it ceased carrying Coca-Cola Co. (KO) (Stock Quote: KO) products due to a pricing dispute with the beverage maker. The wholesale club operator, which operates about 560 warehouses in the U.S. and abroad, said on its Web site that it will not remove bottles of Coke and Diet Coke currently displayed on its store shelves, but does not plan to restock them "until the matter is resolved."

Coca-Cola Co. refused to comment on the squabble, other than calling Costco an important customer and saying it will work with them "in a spirit of fairness."

(KO) Essentially, the Coke/Costco rift is a function of the recession. Strapped shoppers are pushing retailers to lower prices, while product makers like Coca-Cola are straining to maintain margins. What gives this particular fight some additional fizz is that it is being waged by an upstart retailer against one of the world's most heavyweight brands. And judging from the signs on Costco's shelves and site, they don't believe they are fighting above their weight class.

"Costco is committed to carrying name brand merchandise at the best possible prices. At this time, Coca-Cola has not provided Costco with competitive pricing, so that we may pass along the value our members deserve," said a message on the company's Web site, labeled "Price Alert!"

(KO) We here at the Five Dumbest Lab just hope both sides settle this silly beverage battle as quickly and amicably as possible. So when times get better they can go back to their normal practice of overcharging consumers for syrup, sugar and seltzer.


Dumb-o-meter score: 75 -- Our favorite soda? Dr. Brown's Cel-Ray Tonic! Can't beat that celery flavor.

If you liked this article you might like

How 1-800-Flowers Preps for Valentine's Day Crush

Forget Gold and Platinum! Give Your Sweetie Iridium this Valentine's Day

News Corp. Beats on Bottom Line Despite Sluggish Ad Sales

Nvidia Q4 Beats Street on Top and Bottom Lines

Coca-Cola: We'd Like the World to Buy a Coke Zero -- or a Smartwater!