That was the incendiary line that opened a recent news.com.au article into the decline of global beverage business The Coca-Cola Company, which is a part-shareholder in our local beverage bottler, Coca-Cola Amatil Ltd (ASX: CCL).

News.com’s article covers declining soft-drink (‘soda’) volumes and uses this to paint the picture of Coca-Cola as a business in decline. Many Australian investors feel the same way, and the issue has been discussed at some length in the members-only Fool Forums.

Chasing healthier alternatives

Consumers might be chasing alternatives to the conventional soft drink, but Amatil is in a prime position to match changing preferences. The company bottles or distributes over 30 instantly recognisable brands of soft drink, water, ‘enhanced’ water, sports drinks, juice, coffee, beer, cider, whisky, energy drinks, and fruit products.

As one of the largest bottlers in the Asia-Pacific and with a sizeable distribution network, Coke is also in a prime position to acquire or strike distribution deals with beverage companies like Monster Beverage Corporation, which owns the eponymous energy drink.

If anything, Amatil has under-invested in growth segments like coffee in recent years, although CEO Alison Watkins has set about changing that with Amatil’s Grinders and Barista Bros coffee brands.

Is Coca-Cola really dying?

Amatil makes the vast majority of its money in non-alcoholic ready to drink (NARTD) beverages – which includes a wide variety of products besides Coke. Consumer preferences might be changing and sales of soft drinks declining, but the demand for NARTD drinks is not likely to decline.

As a broad-scope beverage bottler, a bet against Amatil involves assuming either demand for pre-packaged drinks is declining, or that the company will be outfoxed by more nimble competitors. On a product basis, there’s no reason to assume that Amatil’s beverages would be materially worse than a competitor’s – likely some will be better, and some will be worse. While sales in Coke might decline, strong growth in other segments could simply indicate that the market is moving in another direction.

Coca-Cola’s relationships with retailers, fast food joints, and grocers like Woolworths Limited (ASX: WOW) and Wesfarmers Ltd (ASX: WES) ensure it has access to the shelf space to stock its wide range of products, which means sales are in part about getting pricing and product mix right, as well as pleasing consumers.

With a decent balance sheet, strong cash flows, and a modest price, Coca-Cola is in a good position to deliver attractive returns to shareholders over the next few years.

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Motley Fool contributor Sean O'Neill owns shares of Coca-Cola Amatil Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.