EXHIBIT B EXHIBIT B
Superlative
The Superlative Group, Inc. Ms. Hilda Fernandez
26600 Detroit Road, Suite 250 Assistant City Manager
Cleveland, Ohio 44145 Office of the City Manager
1700 Convention Center Drive
phone (216)592 -9400 Miami Beach, FL 33139
injo(r4,superlativegroup com April 25, 2011
Dear Hilda,
As part of our engagement with the City of Miami Beach we have been
actively pursuing, among other opportunities, an exclusive, non - alcoholic
beverage Sponsorship that will benefit the City. On behalf of the City, The
Superlative Group engaged in a research and selection process in order to
present to the City the best partnership program that will not only provide
additional /new revenues to the City, but also increase the City's excellent
brand presence. We are pleased to provide to your our analysis of the
results of the process and our recommendation.
After a review of the proposals submitted by Coca Cola Company and Pepsi
Bottling Group, it is our recommendation that the city of Miami Beach enter
into a ten (10) year single source contract with the Coca Cola Company.
As you know, after sending a formal invitation to a meeting with prospective
partners, which was held at City Hall, on January 18, 2011 we invited three
soft drink manufacturers Coca Cola, Dr. Pepper Snapple Group, acrd Pepsi to
submit proposals by March 18, 2011 to become single source vendors for the
city of Miami Beach. The 60 days given to prepare the offers exceeds
industry standards of 4 weeks.
We had advised during the meeting in your offices that we would be inviting
the top two offers to submit and present their final presentations to us on
April 8, 2011. Each company was asked to readdress their proposals before
the presentations to the City as their best and final offer. In an effort to
ensure that any questions from potential users could be addressed,
representatives from the City, golf clubs and convention center were invited
to hear this presentation.
We reviewed the proposals using several criteria and The Coca Cola Company
had the best offer in all categories.
r
• Total financial offer to the city
• Co- branding/Marketing
• Proposed activation plan
• Guaranteed cash contributions
• Commitment to Miami Beach through Sponsorships or Marketing
• Commitment to proposal execution
• Guaranteed equipment up time
• Commission rates on Vending Sales
The process we follow allows us the time to answer individual questions after
original proposals are submitted (see Exhibit A).
We analyze each line item including, but not limited to:
• Signing bonus
• Sponsorship
• Vending commission
• Product pricing
• Additional equipment offered
• Marketing spend with your brand (can panels /truck backs)
• Green initiatives (recycling)
The total cash payments in the first twelve (12) months, which incl
1) Signing bonus
2) Sponsorship
3) Vending commissions
4) Community Sponsorship money
With the Coca Cola offer will be $910,000 vs. $365,760 from Pepsi, the
difference to Miami Beach of $544,240 (Exhibit B).
After reviewing other Soft Drink /Municipal agreements, we believe this
might be the most lucrative offer ever made to a city government (excluding
schools).
The total improved financial position for the City of Miami Beach over the
existing contracts will be at least $5,000,000 over the rates offered under
your existing individual contracts.
Over the next week we will negotiate minor details with Coke to ensure all
individual departments /venues expectations are met with the term of the
contract.
I look forward to seeing you on the 27 to present our findings to council.
Good luck . a good selling,
11111 mi- 4 Aillibb-
Myles C. er
Preside -
MCG/.
C: H. ernand-
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A. Halimon
II
Exhibit A
Exclusivity Contract Timeline - January - April 2011
January
5 -Jan Initial invitation letter sent out from The Superlative Group to top executives at Coca -Cola, Pepsi and Dr. Pepper /Snapple for Q &A invitation
14 -Jan Conference call between Myles Gallagher and The City of Miami Beach
18 -Jan Myles Gallagher to Miami Beach
18 -Jan Question and Answer session held from 3:30 - 5:30PM
19 -Jan Site visit held
21 -Jan Conference call between Myles Gallagher and The City of Miami Beach
24 -Jan Call with John Cordova from Coca Cola
24 -Jan Call with Rosa Rodriguez from Coca Cola
25 -Jan Call with Mike Nast from Pepsi
25 -Jan Call with Greg Johnson from Pepsi
28 -Jan Conference call between Myles Gallagher and The City of Miami Beach
February
1 -Feb Call with Rosa Rodriguez from Coca Cola
4 -Feb Conference call between Myles Gallagher and The City of Miami Beach
9 -Feb Letters sent to Dr. Pepper /Snapple, Coca Cola and Pepsi with categories and invitation to submit proposals due March 18, 2011
11 -Feb Conference call between Myles Gallagher and The City of Miami Beach
16 -Feb Call with Rosa Rodriguez from Coca Cola
21 -Feb Call with Rosa Rodriguez from Coca Cola
23 -Feb Call with Greg Johnson from Pepsi
March
4 -Mar Conference call between Myles Gallagher and The City of Miami Beach
7 -Mar Call with Rosa Rodriguez from Coca Cola
11 -Mar Conference call between Myles Gallagher and The City of Miami Beach
16 -Mar Call with Rosa Rodriguez from Coca Cola
17Mar Call with Greg Johnson from Pepsi -
17 -Mar Call with Ed Klein from Dr. Pepper /Snapple
18 -Mar Conference call between Myles Gallagher and The City of Miami Beach
18 -Mar Proposals from Dr. Pepper /Snapple, Coca Cola and Pepsi Due
21 -Mar Review submitted proposals
22 -Mar Review submitted proposals
23 -Mar Review submitted proposals
24 -Mar Review submitted proposals
25 -Mar Conference call between Myles Gallagher and The City of Miami Beach
29 -Mar Letter to Coca Cola and Pepsi requesting their Best and Final Offer Presentation
29 -Mar Letter to Dr. Pepper /Snapple - rejection
April
1 -Apr Conference call between Myles Gallagher and The City of Miami Beach
4 -Apr Call with Rosa Rodriguez from Coca Cola
5 -Apr Call with Rosa Rodriguez from Coca Cola
5 -Apr Letter to Rosa Rodriguez and Greg Klein with BAFO presentation specifications
7 -Apr Myles to Miami Beach
8 -Apr Pepsi Presenation 10AM
8 -Apr Coca Cola Presentation 11AM
11 -Apr Letter of congratulations sent out to Coca Cola
15 -Apr Conference call between Myles Gallagher and The City of Miami Beach
19 -Apr Call with Rosa Rodriguez from Coca Cola
20 -Apr Call with Rosa Rodriguez from Coca Cola
21 -Apr Call with Rosa Rodriguez from Coca Cola
22 -Apr Conference call between Myles Gallagher and The City of Miami Beach
25 -Apr Conference call between Myles Gallagher, Rosa Rodriguez from Coca Cola and The City of Miami Beach
Exhibit B
ell:::6 N .
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Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 TOTAL
'artnership Funding`
Signing Bonus $ 150,000 $ 150,000
Sponsorship Payment $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 1,000,000
Charity Support Sponsorship $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 50,000
Fountain Rebate $3/gallon Annual volume 3,000 gallons* $ 9,000 _ $ 9,000 $ 9,000 $ 9,000 $ 9,000 $ 9,000 $ 9,000 $ 9,000 $ 9,000 $ 9,000 $ 90,000
BottlelCan Rebate $3/case Annual volume 17,000 cases' $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 51,000 $ 510,000
. FSV Commissions Annual volume 4,700 cases* $ 50,760 $ 50,760 $ 50,760 $ 50,760 $ 50,760 $ 50,760 $ 50,760 $ 50.760 $ 50,760 $ 50,760 $ 507,600
SUBTOTAL $ 365,760 $ 215,760 $ 215,760 $ 215,760 $ 215,760 $ 215,760 $ 215,760 $ 215,760 $ 215,760 $ 215,760 $ 2,307,600
•artnership Support Value'*
Marketing Support" $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 750,000
SUBTOTAL $ 75,000 1 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 $ 75,000 ' $ 75,000 $ 750,000
' epsi Equipment and Service
Fountain units, coolers, vendors "* $ 132,000 _ $ 132,000
Free Service * *' $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 240,000
SUBTOTAL ' $ 156,000 ' $ 24,00 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,000 $ 24,00 $ 372,000
RAND TOTAL $ 596,760 $ 314.760 $ 314,760 5 314.760 5 314,760 5 314,760 5 314,760 5 314.760 5 314.760 $ 314.760 $ 3.429.600
'Estimated Volume
* *Non -cash convertible
* *'Equipment to be replaced /added as needed over life of contract
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$365,760 cash payments first year / `
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Total Value ,, . .
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Financial Proposal: Summary
• This summarizes the financial proposal being
offered to City of Miami Beach
1 year 10 year Term
Annual Sponsorship $800,000 $3,725,000
Estimated Commissions $85,445 $900,970
Recycling Value $15,0000- $25,000 $15,0000- $25,000 •
Marketing Value $200,500 + $2,005,000 +
Equipment & Card Reader Value $320,420 $320,420
Bikes Funding $25,000 $25,000
Integrated Joint Logo Value Priceless Priceless
Total $1,456,365 $7,001,390
Please note that total financial value of the proposal can be greater due to the numerous marketing
impressions. Coca -Cola can also assist the City of Miami Beach increase revenues through in venue
activation which has proven successful in increasing sales. That value is not captured above..
**Estimated commissions listed above are based on vend rates exhibited in Exhibit A & B. Commission
potential can be greater if City elects to use Vend Rates in Exhibit C
M IAMIBEACH Canfiden,ial 5 �nL