Arizona Iced Tea founder on why he's kept the 99-cent price tag: ‘We're successful'

When it comes to his business, raising prices on a popular product isn’t exactly Arizona Beverages’ chairman and co-founder Don Vultaggio’s cup of tea.

For him, his 99-cent teas are best served with the assurance that its cost will remain the same.

Vultaggio co-founded Arizona Beverages USA 30 years ago — on May 5, 1992. At the time, a gallon of whole milk was $1.13, a gallon of gas was the exact same, and a 23-ounce can of Arizona iced tea was 99 cents.

But through the decades and surging inflation rates, Arizona iced tea has held the line. Instead of cranking up the value of its iced tea, the company has opted to snip out the extra expenses that might increase the price.

“People say, ‘How do you do that?’ We make it faster. We ship it better. We ship it closer. The cans are thinner,” he explained in a recent interview with TODAY’s Savannah Sellers.

“We’re successful. We’re debt-free. We own everything. Why? Why have people who are having a hard time paying their rent have to pay more for our drink?” he told Sellers. “Maybe it’s my little way to give back.

When asked whether he ever intends to raise prices, he responded, “Not in the foreseeable future. We’re gonna fight as hard as we can for consumers.”

In a 2022 interview with TODAY.com, Vultaggio explained that this shrewd understanding is why, despite recently witnessing inflation rates hit a 40-year high, he’s sold his iced tea drinks at the same exact price for years. Best known for its cherry blossom aesthetic, hefty 23-ounce size and reliably low price tag, Arizona iced tea is one of those gas station staples whose prices make it a sure and sound go-to like your mom’s lasagna or the rhythms of Old Faithful.

Despite evolving into a multi-billion-dollar enterprise — it’s one of the top iced tea and juice brands in the United States — its spirit remains as humble as Vultaggio’s beginnings as a truck driver.

“To me, the worst day as a salesman is to go to a retailer and say, ‘Hey, by the way, I’m raising the price on that can today,” Vultaggio told TODAY.com in 2022. For him, such changes have negative trickle-down effects, which he’s made a point to avoid.

“What you want to do is have a customer come in and get a fair value on a can of tea or juice and then buy other things in your store to offset those costs,” he explained.

Vultaggio said that, as a businessman, his job is to stay ahead of increasing costs.

“One day, I was on the George Washington Bridge, and it was backed up. It was like two o’clock in the afternoon. And I said, ‘We’ve got to get our trucks off the roads during the day. We’ve got to come in at night,’” he explained. “It was a simple decision ... We’ve now shipped all of our products overnight so that our trucks will be more efficient.”

Vultaggio said this steadfast approach has largely stemmed from his early years, when he first learned how to work for pennies.

Today, Vultaggio is estimated to be worth $3 billion. Decades ago, however, he was 13 years old clocking in at a grocery store after a day of school so that he could earn $1 per hour. Growing up, he watched his own father work at a grocery store as a manager and as an adult, Vultaggio says some of his greatest friendships stem from those early days bagging produce at that grocery store in Brooklyn, New York. In fact, one of his closest and most important relationships was with that first employer of his many decades ago. Not too long ago, when that friend passed away at 97, Vultaggio said his family sent him the ashes.

“He’s buried in my backyard,” he said.

It’s a story with sentimentality that is not often attributed to the like-moneyed executives. Think Ray Kroc of McDonald’s in “The Founder” or Logan Roy in “Succession.” Likely, it’s also what’s brought about the attention Arizona has gained in the past couple of years as surging inflation encumbers the pockets of working-class families. The income of these families largely go to basic necessities like rent, groceries and gas, making products like iced teas, doughnuts and other snacks a luxury.

“Everything (people are) buying today there’s a price increase on. We’re trying to hold the ground for a consumer who is pinched on all fronts,” Vultaggio explained. “I’ve been in business a long time, and candidly, I’ve never seen anything like what’s going on now. Every single thing has gone up, and I call it ‘from a paper clip to a too-big filling machine.’”

In the meantime, through high inflation and low inflation, consumers can rely on one thing for certain: That iconic Arizona 99-cent price tag will remain the same.

This story first appeared on TODAY.com. More from TODAY: