Resolution 2021-31965RESOLUTION NO. 2021-31965
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, WAIVING, BY 5/7TH VOTE, THE FORMAL
COMPETITIVE BIDDING REQUIREMENT, FINDING SUCH WAIVER TO
BE IN THE BEST INTEREST OF THE CITY, AND AUTHORIZING THE
CITY MANAGER TO NEGOTIATE AN AGREEMENT WITH RED BULL
NORTH AMERICA, INC. (RED BULL), AS THE EXCLUSIVE ENERGY
DRINK SPONSOR, TO INCLUDE POURING RIGHTS, MUNICIPAL
MARKETING, VENDING AND DISPENSING ON CERTAIN CITY -OWNED
PROPERTIES, BASED UPON THE ESSENTIAL TERMS SET FORTH IN
THE CITY COMMISSION MEMORANDUM ACCOMPANYING THIS
RESOLUTION, FOR A TERM OF FIVE (5) YEARS; AND FURTHER
AUTHORIZING THE CITY MANAGER AND CITY CLERK TO EXECUTE
THE AGREEMENT, SUBJECT TO FORM APPROVAL BY THE CITY
ATTORNEY.
WHEREAS, the City's municipal sponsorship agency, Global Spectrum L.P. ("Spectra
Partnerships"), worked with City staff to identify priorities for their efforts in securing municipal
marketing partners, and identified non-alcoholic beverage partnerships as a target category,
and;
WHEREAS, Spectra Partnerships initiated a selection process to identify and
recommend an exclusive / official non-alcoholic beverage partner for the City, with the goal of
identifying a partner that would be interested in a brand affiliation relationship with the City, and
providing a marketing benefit to both parties, as well as revenue generation for the City; and
WHEREAS, Spectra Partnerships initiated a process that involved the initial
identification of potential respondents; an invitation for those companies to submit proposals;
the selection of the best potential partnership offers for the submission of a "best and final" offer;
and the recommendation of a final offer for the City to consider; and
WHEREAS, Spectra Partnerships invited the top three (3) national entities in the non-
alcoholic beverage category to submit "best and final" offers and, subsequent to their
submission and presentation, recommended to the City the selection Red Bull North America,
Inc. (Red Bull) as the City's exclusive energy drink sponsor to include pouring rights, municipal
marketing, vending and dispensing rights on certain city -owned properties, based upon the
essential terms set forth in their proposal, attached as Exhibit "A" to the City Commission
Memorandum accompanying this Resolution (the "Proposal"); and
WHEREAS, Spectra Partnerships analyzed the Proposal and advised City staff that an
agreement with Red Bull would provide a financial and marketing benefit of more than
$1,275,000 to the City over the proposed five-year term of the partnership (cash and non - cash
value); and
WHEREAS, based upon the foregoing, the City Manager recommends waiving, by 5/711
vote, the formal competitive bidding requirement, as permitted in Section 2-367(e) of the City
Code, and authorizing the City Administration to negotiate an agreement with Red Bull for a
term of five (5) years, based upon the essential terms set forth in the City Commission
Memorandum accompanying this Resolution.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION
OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby
waive, by 5/7 1h vote, the formal competitive bidding requirement, finding such waiver to be in the
best interest of the City, and authorize the City Manager to negotiate an agreement with Red
Bull North America, Inc. (Red Bull), as the exclusive energy drink sponsor, to include pouring
rights, municipal marketing, vending and dispensing rights on in certain city -owned properties,
based upon the essential terms set forth in the City Commission Memorandum accompanying
this Resolution, for a term of five (5) years; and further authorize the City Manager and City
Clerk to execute the agreement, subject to form approval by the City Attorney.
PASSED and ADOPTED this 8th day of December 2021.
ATTEST:
i��ogr�ORAT o° = Dan Gelber, Mayor
RafKel ff-r3ianado, City Clerk
DEC 1 3 2021
APPROVED AS TO
FORM & LANGUAGE
& FOR EXECUTION
Date
CCity Attorney
Resolutions - R7 AB
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Alina T. Hudak, City Manager
DATE: December 8, 2021
SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, WAIVING, BY 5/7TH VOTE, THE FORMAL
COMPETITIVE BIDDING REQUIREMENT, FINDING SUCH WAIVER TO BE
IN THE BEST INTEREST OF THE CITY, AND AUTHORIZING THE CITY
MANAGER TO NEGOTIATE AN AGREEMENT WITH RED BULL NORTH
AMERICA, INC. (RED BULL), AS THE EXCLUSIVE ENERGY DRINK
SPONSOR, TO INCLUDE POURING RIGHTS, MUNICIPAL MARKETING,
VENDING AND DISPENSING ON CERTAIN CITY -OWNED PROPERTIES,
BASED UPON THE ESSENTIAL TERMS SET FORTH IN THE CITY
COMMISSION MEMORANDUM ACCOMPANYING THIS RESOLUTION,
FOR A TERM OF FIVE (5) YEARS; AND FURTHER AUTHORIZING THE
CITY MANAGER AND CITY CLERK TO EXECUTE THE AGREEMENT,
SUBJECT TO FORM APPROVAL BYTHE CITYATTORNEY
RECOMMENDATION
The administration recommends waiving, by 5/7th vote, the formal competitive bidding
requirement, as permitted in Section 2-367(e) of the City Code, and authorizing the City
Administration to negotiate an agreement with Red Bull for a term of five (5) years, based upon
the essential terms set forth in the City Commission Memorandum accompanying this
Resolution.
BACKGROU N DM ISTORY
The City has an agreement for pouring rights with Coke Florida as the non-alcoholic beverage
partner. Pouring rights refers to dispensed non -alcohol beverages or beverages sold via
concession, as compared to those being sold through a vending machine. This agreement was
approved by the Commission on March 14, 2012 and is set to expire on December 31, 2021.
The City's municipal sponsorship consultant, Spectra Partnerships, initiated a selection process
for new non-alcoholic beverage partnership opportunities for the City. Spectra Partnerships has
developed and cultivated successful non-alcoholic beverage partnerships for 150+ clients
across North America and has identified multiple opportunities to grow the financial, brand,
product, and sustainability contributions for both the City and its residents and visitors.
Current Opportunities:
Comparable to the previous partnership, the selected entity would have exclusive category
Page 1220 of 1464
vending and pouring rights at all pre -determined City owned facilities, including those currently
managed by third parties, including, but not limited to the Miami Beach Convention Center, the
North Beach Bandshell and Flamingo Park Tennis Center as examples.
The management or contracted companies for these respective City facilities will be required to
comply with any of the City's selected category sponsors, with all revenues relating to
sponsorship and commissions, as well as marketing support, to benefit the City directly.
Process:
Spectra Partnerships managed the process relating to the exclusive beverage partner program
on behalf of the City, beginning with initial identification of potential respondents; an invitation for
those companies to submit proposals; the selection of the best potential partnership offers for
the submission of a "best and final" offer; and the recommendation of a final offer for the City to
consider.
Spectra Partnerships' involvement has included being the day to day contact for proposers as
well as facilitating all administrative functions, analysis of comparable partnerships, negotiation
on sponsorship deal points, and providing these potential partners with information relating to the
City and opportunities. Spectra Partnerships also gathered information on current venues,
volumes, and deal structures.
Proposal Components:
Spectra Partnerships advised prospective proposers of the City's interest in an energy drink
partner and the availability of opportunities from this partnership. Spectra Partnerships also
advised the prospective proposers of the City's interest in securing a partner that provided an
annual sponsorship fee, a comprehensive marketing plan, and a sustainability and recycling
strategy to enhance the presence of both the partner brand and the Miami Beach brand to
ensure the executed agreement was a 360 degree integrated plan, and not simply an exchange
of money. Red Bull North America, Inc. (Red Bull) submitted a five-year proposal.
ANALYSIS
Best and Final Offers:
Based on Spectra Partnerships review, Red Bull presented a proposal that provided a
combination of an annual "sponsorship" fee, commissions on sales, and a rebate program. Red
Bull also provided preferred product pricing, as it was essential that proposed pricing be
competitive with current pricing in the overall market and at City of Miami Beach venues. The
proposal also delineated potential marketing opportunities from the partnership.
Below are the major components of the proposal:
Term:
5 years
Sponsorship fee:
$75,000 per month paid within 30 days of contract execution.
Commissions / Pricina / Rebates
Rebate Bonus: $5 per case purchased, paid quarterly.
Volume Bonus: $25,000 paid at 10,000 cases, additional $25,000 for each
additional 5,000 cases.
Pricing - $36/case for 24 x 8.4 oz cans
Sample Product — 15,000 cans at $3/can for CMB employees, and 30,000 cans
at $3/can at mutually agreed upon occasions.
Page 1221 of 1464
Sustainability
Marketing:
80% renewable energy in the manufacturing process.
Red Bull cans are made of up to 100% recycled aluminum.
Red Bull cans are 100% recyclable.
Secondary packaging (carton and foil) is made up of up to 100% recycled
material and is 100% recyclable.
Red Bull offers some of the world's most recognizable branded events and
marketing efforts and will look to partner with the City across multiple activations which
could include F1, athlete collaborations, and the Red Bull Air Force. Red Bull is
committed to exploring all activations with the City as they are currently building out
their 2022 and beyond activation strategy.
PROPOSAL:
ExhibitA outlines the sponsorship proposal submitted by Red Bull. The proposal delineates
the general responsibilities of each party during the term of the Agreement. As noted, several
points remained under discussion at the time this agenda item went to print, pending further
clarification and agreement by Red Bull's and the City's legal teams on proposed language
submitted by all parties and to be confirmed in the verbiage included in the final contract. The
final contract will also include all confirmed locations of potential vending equipment.
Estimated Total Value:
Red Bull was founded in 1984 and controls the largest share of the energy drink category in the
global beverage industry with over 7.9 billion cans sold in 2020. As reflected in the attached
proposal, the estimated total value of the proposed energy drink sponsorship partnership with
Red Bull over the term of the agreement is approximately $1,275,000, inclusive of the annual
sponsorship fees ($375,000); can rebate ($100,000), volume bonus ($125,000) and sample
product value ($675,000).
The following charts provide a breakdown of the value of the proposed partnership between the
City of Miami Beach and Red Bull (cash and non-cash):
RED BULL
YEAR
Sponsorship
Rebates
Volume
Bonus
Product
Commitment
TOTAL
2022
$75,000
$20,000
$25,000
$135,000
$255,000
2023
$75,000
$20,000
$25,000
$135,000
$255,000
2024
$75,000
$20,000
$25,000
$135,000
$255,000
2025
$75,000
$20,000
$25,000
$135,000
$255,000
2026
$75,000
$20,000
$25,000
$135,000
$255,000
$375,000
$100,000
$125,000
$675,000
$1,275,000
Requirements of City:
Page 1222 of 1464
As is common in these types of partnerships, there are certain expectations with regards to the
non-alcoholic beverage partner's role. In addition to supporting the efforts of expanding the
sales of the products through city -owned vending locations and venues, support will include:
recognition of the partnership as the official energy drink of Miami Beach; exclusive sampling
rights on public fights of way, with a waiver of certain permit and application fees for a limited
number of sampling events on public property (mutually agreed upon and to be determined in
the final contract); recognition of the integrated logo, with a right to use the logo; City use of only
Red Bull energy drink products at City events (the agreement negotiated will be subject to any
existing contractual rights that the city has with other parties, and will allow the City a certain
number of waivers per year.
Spectra Partnerships, in conjunction with the administration, recommends that the City enter
negotiations with Red Bull as the City's official energy drink partner, pursuant to the proposal in
Exhibit A.
SUPPORTING SURVEY DATA
N/A
Applicable Area
Citywide
Is this a "Residents Right
to Know" item, pursuant to
City Code Section 2-14?
No
Strategic Connection
Non -Applicable
Legislative Tracking
Marketing and Communications
ATTACHMENTS:
Description
❑ Exhibit A - Red Bull Proposal
❑ Resolution
Does this item utilize G.O.
Bond Funds?
No
Page 1223 of 1464
PROPOSH, NV
MERCHANDISING POS --) N/A
Page 1224 of 1464
ATHLETE ACTIVATIONS
0
Page 1225 of 1464
EXECUTION BONUS M APPROVED DISTRIBUTORS
• $75K PAID WITHIN 30 DAYS OF •BREAKTHRU BEVERAGE
CONTRACT EXECUTION • RBDC
• SYSCO
REBATE
• $5 PER CASE PURCHASED, PAID PRICING
N30 QUARTLERY r $36/CASE
• 24 8.4 OZ CANS
VOLUME BONUS
• $25,000 PAID AT l OK CASES, VENDING
ADDITIONAL $25,000 EACH 3RD PARTY VENDOR SELECTION
ADDITONAL 5K CASES UP TO SPECTRA
Page 1226 of 1464
CITY OF MB EMPLOYEES
'` 15K CANS @ $3 A CAN
CITY OF MB CONSUMERS
• 30K CANS @ $3 A CAN
• MUTUALLY AGREED UPON
OCASSIONS AS TO NOT
H CANABALIZE SALES
H
SALES INCREASE
�k PROFIT PROJECTION - UPDATED
1101 MONSTER
CURRENT $1.43
SELLINGQ 0..
SITUATION COST PER CAN
8.4 OZ RED BULL
PROPOSED $1930
SELLINGO
SITUATION COST PER CAN Red Bull
Page 1227 of 1464
$65K
PROFIT ON 600 CASES
AT $4.5 PER CAN
CONSIDERATIONS
O • ASSUMES AVERAGE SELLING PRICE OF $4.5
PER 16 OZ MONSTER CAN
• MONSTER NOT AVAILABLE AT ALL OUTLETS
OR EXECUTED WELL DURING EVENT
LANDSCAPE.
$432K CONSIDERATIONS
• ASSUMES AVERAGE SELLING PRICE OF $4.5
PROFIT ON 4K CASES 0 PER 8.4.
SOLD TO CONSUMERS • HISTORICAL DATA FOR LIKE ACCOUNTS USED
AT $4.5 PER CAN FOR PROJECTIONS (APPENDIX Q
Y-1 ��, - - - �
VALUE IN KIND
RED BULL TO PROVIDE
• VENDING MACHINES
• COLD EQUIPMENT
• MENU DESIGN & PRINT
• DIGITAL POSTERS
• SOCIAL MEDIA CONTENT
CREATION
r f r as r f i
K660
Page 1229 of 1464
RED BULL TO PROVIDE
• DJ DESKS
• BARS
• WIG-WAMS (LARGE PARASOL)
• EVENT VEHICLE
POS
DIGITAL POSTERS- CLICK VIDEO ON THE RIGHT
Page 1230 of 1464
lo:1!1►`I1
I
CASH BAR
'ow
WWI
SMALL FIRE BAR m LIVE MUSIC BAR m OSCAR BAR m LAB BAR
SNOBEA BAR IMAGE 2020 BAR MODULAR BAR WAVEBREAKER BAR ELEMENTS BAR
LIVE MUSIC D1 DESK
REFLECTION DJ DESK
I
li
y �
LIVE MUSIC D1 DESK - LIVE MUSIC DJ DESK - SHAPE SHIFTER D1 DESK LTA W DESK
STYLE XL
SUPERNOVA D1 DESK ■ WINGS W DESK ■ IMAGE 2020 DJ DESK ■ WAREHOUSE LIVE
DJ DESK
ar•
G2 PARASOL
WIGWAM 11 - 16M
63.5 PARASOL■ G3.5SILVER SOL ■ PARAGASTRONOMY ■ G3.5 PARASOL WIGWAM I - 13M
Gyt ! ad r
ARCH 400 ARCH 500 ARCH 800 ARCH 1000
MARKETING
SUPPORT
MARKETING SUPPORT
F1 COLLABORATIONS
Page 1237 of 1464
�1..•= � is tx I
R
A
a
I ►
MARKETING SUPPORT
RED BULL AIR FORCE
Page 1239 of 1464
SUSTAINABILITY
SUSTAINABILITY AT RED BULL
WE USE MORE THAN 80% RENEWABLE ENERGY AND ARE EXPANDING THE USE CONTINUOUSLY.
OUR CANS ARE MADE OF UP TO 100% RECYCLED ALUMINUM.
RED BULL CANS THEMSELVES ARE 100% RECYCLABLE,.
SECONDARY PACKAGING, SUCH AS THE CARTON AND FOIL, IS MADE UP OF UP TO
100% RECYCLED MATERIAL, AND IS 100% RECYCLABLE.
Page 1241 of 1464
Yah Taurine.
SFdy carbonated
WHAT IS IN THE CAN?
t I
WHAT'S IN THE CAN?
TAURINE
An amino acid found naturally
in the human body and
involved in a wide range of
biological processes.
B -VITAMINS
B -Vitamins play an important
role in energy -yielding
metabolism, such as the build
up and breakdown of
carbohydrates and proteins.
Page 1243 of 1464
CAFFEINE
Caffeine's primary site of
action in the human body is the
central nervous system where it
stimulates cognitive functions.
SUGAR
Well known carbohydrates
(basic nutrients) that are
consumed in the daily diet.
450
400
350
W
W 300
a
250
a 200
m
150
100
50
0
CAFFEINE CONTENT OF POPULAR BEVERAGES
THE AMOUNT OF CAFFEINE IN A CAN OF RED BULL IS SIMILAR TO
THE AMOUNT IN A HOME BREWED CUP OF COFFEE
415
330
400m9 FDA, Health Canada, EFSA's opinion on safe moderate daily consumption for healthy adults
210 200m9 FDA, Health Canada, EFSA's opinion on safe single serving for healthy adults
180
95 80
LARGE COFFEE HOUSE DRIP MEDIUM COffEE HOUSE DRIP ENERGY SHOT SMALL COFFEE HOUSE DRIP NOME -BREWED DRIP COFFEE RED BULL ENERGY DRINK
20 FL OZ 16 FL OZ 2 FL OZ B FL OZ 8 Fl OZ 8.4 Fl OZ
http://ndb.nal.usda.gov/ndb/search/list?qlookup— 19902
Page 1244 of 1464
47
El
BUCK TU
8 FL OZ
34 32
TYPICAL COLA ORGANICS BY RED BULL SIMPLY COU
12 FL OZ BFLOZ
SUGAR CONTENT OF POPULAR BEVERAGES
ONE CAN OF RED BULL CONTAINS ABOUT THE SAME AMOUNT
OF SUGAR AS A GLASS OF APPLE JUICE
60 56
50
40
a
30
c�
N
20
10
0
53 52
46
40 39
35 32
27
16
12
(RAN -GRAPE JUICE BLENDED FRUIT JUICE OTHER ENERGY DRINK DEWEY SODA COLA RED BULL ENERGY DRINK SPORTS DRINK VITAMIN ENHANCED WATER RED BULL ENERGY DRINK LIGHT SWEETENED TEA COCONUT WATER
1S.2 Ft OZ 16 FL Oz 16 FL OZ II FL OI 12 FL OZ 12 It
OZ 20 FL OZ 20 FL 0Z 9.4 FL OZ 16 FO OZ II FL OZ
Source: Source: Food Chemistry, H.A. Belitz, W. Grosch, P. Schieberle, third edition (2004), Springer -Verlag, Stiftung Warentest (7/2012), USDA Nutrient Database
Page 1245 of 1464
TRUSTED THIRD PARTY CERTIFICATION
Page 1246 of 1464
...is an independent and accredited non-
governmental organization whose mission is "to
protect and improve global human health".
RED BULL HAS BEEN NSF CERTIFIED
FOR SPORT SINCE 2006.
Red Bull is the first and only energy drink to have
this certification.
• For more information visit: www.nsfsport.com
ENERGY CATEGORY
PERFORMANCE
$503 M
ENERGY LEADS TOTAL BEVERAGE GROWTH YTD
ENERGY UP A FULL $SHARE POINT OF TOTAL BEVERAGE MINTEL
CATEGORY $GROWTH - MULO+C
$ SHR CHANGE VS YA
$314M
$152 M
t
$140 M $105 M $89 M
$33 M
SPARKLING
ENERGY CSD BOTTLED WATER WATER C=OFFEE ISOTONICS
1.0
- 0.3 0.2 0.0
-0.3 -0.1 -0.1
IURCE IRI MULO+C YTD W 5.19.2019
Page 1248 of 1464
RED BULL HOLDS 6/10 TOP ENERGY SUBBRANDS
� ALL SRU AND PACKS SIZES
ul
G
U#8
YTD
'ALES
$392 MM $232 MM $118 MM $103 MM
V WTD 99 95 97
DIST
,URCE: IRI Total US MULO+C YTD WK DATA ENDING 02-23-20
$47 MM $33 MM
79
Page 1249 of 1464
$32 MM
$28 MM
79
r �
�XE ,
E1 "fl G�j.
TITIC N
�Cocronut Be,
ENERGY DRINK
v. ,.i,... 6.* and � f
1 nsa r
$26 MM $26 MM
80 75
RED BULL LARGEST SINGLE SERVE BRAND IN US MULO(
cig
RED BUIL DRIVING MOST % GROWTH MONSTER AND MTN DEW DECLINING
TOP FIVE SINGLE SERVE BEVERAGE BRANDS - FY 2019
#1 #2 #3 #4 #5
wG,,)p �"
Red t3u11 FAMILY GATORADE
Q�
ass $4.5 B $3.8 B $3.1 B $2.7 B $2.0 B
+7.1% -1.0% +2.3% +3.9% -3.8%
$ CHG +$93 M -$38 M +$70 M +$102 M
JRCE: IN TOTAL US MULO+C YTD DATA ENDING 12.29.2019
Page 1250 of 1464