January 24, 2013
In the video below, Motley Fool consumer goods analyst Austin Smith reveals three reasons investors might not want to go for SodaStream.
1. The product may be a fad in the U.S. and fizzle. Just because SodaStream is popular in Europe doesn't mean it'll be popular in the States. Sales of the company's CO2 cartridges will be a key barometer of its ongoing popularity.
2. The technology, while novel, is not revolutionary. Competitors could easily enter the market with their own soft drink carbonation products.
3. The CO2 cartridges need replacing and this could prove to be a hassle. Customers will need a convenient place to exchange their old cartridges for new ones, and right now, there are not a lot of places for consumers to do this. Rapidly expanding a supply network before American customers get frustrated will be important.
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