For years, executives and analysts close to the company have expected Coke to take such a step. The Atlanta-based beverage giant faces rising pressure to find new growth after its beverage volumes stalled in the most recent quarter.
The moves come as Coke also tries to catch up in the U.S. ready-to-drink tea market, which also is growing fast as Americans thirst for more caffeine but less soda. The bottled tea category is led by the Lipton joint venture of PepsiCo and Unilever NV.

For Dunkin’ (DNKN) , it is the latest attempt to position itself in the U.S. as more of a coffee destination than a doughnut stops. Coffee already represents 50% of its U.S. sales, including hot, iced, brewed and espresso. This summer, it rolled out cold brew coffee in some markets and is testing café au lait in New York.

Dunkin’ acknowledged bottled coffee sales in its doughnut shops could hurt sales of its iced coffee drinks but that many customers who buy coffee at Dunkin’ Donuts go elsewhere later in the day to buy a competitor’s bottled coffee brand.
“We want to stop that from happening,’’ Dunkin’ Chief Executive Nigel Travis said in an interview.

Under their partnership, Coke will pay a fee to Dunkin’ that will be split between the company and franchisees that operate nearly all of its shops. Neither company would disclose financial terms.

To make the coffee, Coke will make use of U.S. milk-making facilities through its Fairlife dairy joint venture, according to a person familiar with Coke’s plans.

Bottled coffee sales are still a fraction of soda and bottled water sales, in large part because many consumers prefer coffee hot and freshly brewed. Still, U.S. retail sales of ready-to-drink coffee rose 14% to $2.54 billion last year, the fourth straight year of at least 10% growth, according to the data service Euromonitor International.