Chris Brook-Carter

The beverage business blog from Chris Brook-Carter

If you would like to offer your comments, opinions, suggest topics or just have a good rant, please feel free to email: Chris Brook-Carter.

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Wine's slow, steady sparkle

21 Oct 2011 13:25

I am just putting together the final touches to my presentation on non-Champagne sparkling wine for the International Sparkling Wine Symposium in 10 days time.

Our friends at The IWSR have just sent through their latest forecasts for the sector and, once again, sparkling wine is proving one of the quiet successes of the drinks industry.

Despite the recession and continued economic difficulties, the market is forecast to reach 200m nine-litre case by 2016, up from 150m in 2005 and the current 176m. Sparkling wine has been growing worldwide at a CAGR of 2.9%. While that's due to flatten out a little to 2.3% from now until 2016, there are still many regions where that worldwide number will be easily beaten.

Of course, if you want to hear why and where it is being successful, you'll need to be at the event in two weeks, or at least monitor these pages from Tuesday onwards.

But the breadth of markets, where it's seeing growth and the large number of positive trends driving success (allied to the lack of serious marketing muscle) makes it one of the more colourful drinks categories.

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just-drinks' spirits brand rating survey - Over to you

02 Aug 2011 15:59

just-drinks' inaugural spirits brand rating survey has gone live this week. Let's be clear straight away, the results of this survey - combined with performance data from our partners IWSR - are not meant to merely mirror other rankings out there on the market, which tend to reflect only the size of the brands, either by volume or value. Our aim here is to produce a report that gives something far more complex and, hopefully, more useful; a reflection of a brand's performance and its perception in the market.

How do you measure performance, though? After a great deal of discussion, IWSR has scored each brand via a mix of its market volume, value, recent growth and pricing. just-drinks' readers will now be asked to look at each brand that currently leads its category on the above mix and give us their views on each brand's strengths and weaknesses. Each reader will also get the chance to take surveys within sub-categories such as rum, vodka and whisky. So, if your favourite brand isn't currently listed on the first page as a category leader, keep going and you'll probably find it later in the survey.

As with all these lists, our results as they currently stand, and in the final report, are bound to cause controversy - but that's half the fun isn't it? We have already had enquiries as to why certain big hitting brands are absent from the category leaders page? All I can say is that, whilst they may command impressive volumes, they may have fallen down on one or two of the other key criteria.

The end result, we hope, will be a unique take on the global spirits market and a clear view of brands everyone should be taking note of.

To take the survey, click here.

 

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The wisdom of crowds, or, two heads are better than one

07 Mar 2011 09:43

One of the great advantages of working at just-drinks is the community that has built up around the website over the last decade, and the ability to tap into that vast resource of knowledge to add value to what we can offer our collective audience. My tech team here tell me its part of a theory called 'The Wisdom of Crowds'.

To me, it just seems like common sense. You are the experts of your own industries. If we can collect that knowledge, pool it, and then feed it back into the industry, being part of the just-drinks community makes even more sense for all of us.

So, if you have a spare five minutes, it would be great if you could complete our latest survey, which is looking at innovation within the whisk(e)y sector.

Covering issues such as regulation, rival spirits sectors and barriers to innovation, the aim of the survey is to discover what you think about the sector and what the future holds for whisk(e)y within the ever-changing spirits industry.

The results from this survey will be used in my presentation - Challenges of Innovation - at this year's World Whiskies Conference on 12-13 April. The complete analysis will also be available to anyone who fills out the survey.

So if you are interested in what your competitors are thinking on this key topic, then click here to begin the survey.

Thanks for your time.

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Have we weathered the downturn?

04 Feb 2011 17:35

Back when I was covering the financial performance of the world's drinks groups, I remember reaching a point when I got fed up of reading statements blaming weak sales performances on the weather.

"It's too wet to sell beer." "It's too hot too sell wine." "It's too cold to sell cider." I just never really bought into the idea that 21st century sales and marketing strategies could be floored by something as primeval and ad hoc as the climate. Don't get me wrong, I could see the logic, to some extent. But this is the UK, not flood-ravaged Queensland. And, executives seemed so keen to point to average rainfall figures that, in reality, meant you forewent the flip-flops before heading to the pub anyway and exclaimed: "See, there you go. We never stood a chance."

That has all changed in the last two years. The winters of 2010/11 and 2009 have been so spectacularly awful here in the UK that it has become a kind of sport to see which brand, company or category has become the latest to fall foul of the elements. But even now I have tried to maintain a healthy scepticism to its effects. I am, I suppose, a financial climate-change denier.

So, when fourth-quarter GDP figures here in the UK showed the country's economy had slipped back into negative growth, I was not convinced by arguments that the snow was the trigger for a one-off blip. "Here we go," I proclaimed, "it's going to be a double dip!"

So, it is a with a degree of humble-pie - which I am happy to eat for once - that I read the latest indicators that the weak recovery is still underway in 2011 Q1. The service sector rebounded strongly in January, according to the latest purchasing managers’ survey from Markit/CIPS. This follows equally promising signs from the manufacturing industry last week.

Of course, January in the UK has been as grey and un-noteworthy as it could possibly be. The lesson is, I guess, that you under-estimate Mother Nature at your peril.

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China's good... No, bad... What he said

20 Jan 2011 15:05

Communication - it's at the heart of all good organisations. I have just finished writing a piece on the current contrary position being taken by economists on China's short and medium-term economic prospects.

Is it, as many still argue, a panacea for all that ails the global business community or an economic time-bomb ready to explode the World's fragile recovery? Whether it's pundits on the television or economists in the newspapers, no one can seem to agree.

I was about to draw on some drinks industry examples to write a similar piece for this website, only to discover I had been beaten to the post by this excellent dissection of the debate by Chris Mercer.

Great minds and all that. (To be fair we had discussed this at length on Tuesday, only never to resolve who would write the piece. As I say, communication.)

To Chris' piece I will only add a reference to the trend amongst hedge funds to set up distressed China funds. As one eloquent expert was quoted in the UK press as saying this week: "Economists have contrarian views all the time. But these hedge funds have their shirts on the line and do their analysis carefully. The flurry of 'distress China' funds is a sign to sit up."

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Suppliers should brace for the King of tough years

13 Jan 2011 11:10

If you remain under any illusions as to how tough the UK retail scene continues to be - and let's face it, it will probably get worse this year - then look no further than an article on our sister site just-food yesterday, quoting Sainsbury's CEO, Justin King.

Suppliers, he said, would have to "work very hard" to justify price increases as commodity costs continue to rise.

Speaking exclusively to just-food, King said that many of the commodity cost increases, particularly on wheat, had been "widely predicted" and that suppliers should have prepared by hedging against them.

It's unusual to hear rhetoric like this in the public domain. We all know that negotiations between suppliers and supermarket buyers are robust, but they largely remain behind closed doors. That King has made these comments in public is perhaps a reflection of the inevitably more heated nature of the debate in coming months.

Over Christmas I had a couple of conversations with well-placed sources who believed we would see a small number of high profile desertions of the UK supermarket sector from within the wine trade this year.

With no sign that margin pressures will go anywhere positive again this year, who can blame them?

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No smoke and mirrors for the future of alcohol legislation

10 Jan 2011 12:09

Ten years ago, it was only the more shrewd amongst the alcohol sector that looked at the cigarette industry and thought, "there but for the grace of God...". As the authorities systematically attacked the tobacco industry - with tax hikes, advertising restrictions and ever more draconian labelling legislation - many simply could not believe that drinking and smoking could ever be viewed in the same bracket by health campaigners and legislators.

It's far easier now, with ten years of hindsight, to see the similarities between the two industries. Drinks companies have faced a well-organised and aggressive opposition in the anti-alcohol lobby, and, governments in the West have responded with rising "sin taxes" and tightening advertising and labelling restrictions. The only question now is not if alcohol will follow tobacco's fate but to what extent.

So, its interesting to see that Citigroup has today predicted that smoking could "virtually disappear" in Britain within half a century. In the 1960s, just over half of the UK's adult population smoked. But, it's been on the wane since and the huge campaign to educate the public of its serious health consequences - along with the introduction of the smoking ban in 2007 - saw that figure drop to a fifth by 2008.

Of course, Citigroup warns that its predictions are extremely long-term. But, for the anti-smoking lobby to have effectively wiped out the cigarette industry in many Western markets in the space of a century would be an extraordinary victory. Can you see a similar end to the alcohol sector a further 30 years on? Let's be realistic, probably not. Drinking is a far more ingrained part of our culture and, importantly, when consumed responsibly, it does not have serious health effects.

But, as an exercise in learning how consumer behaviour can be changed drastically, it should be sounding alarm bells. If the anti-alcohol lobby continues to campaign as hard as it has done in the last decade, can you also not see it having a significant impact on overall consumption by, say, 2050?

It would be easy for drinks companies to dismiss this as alarmist. However, if we had collectively learnt from the attack on tobacco ten years ago, perhaps the drinks sector wouldn't be quite so on the back foot to restrictive legislation as it is now.

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It's open season on just-food

17 Nov 2010 15:46

There is an ongoing debate within the media at the moment about the direction of online publishing, in particular the virtues of 'paid for' and 'free to access' content. It dominated discussions at the Association of Online Publishers Summit I attended last month and has been given added edge in the last 12 months by the decision of UK newspaper The Times to take all of its journalism behind a paywall, whilst competitors such as the Guardian and the Daily Mail remain free to view.

It has been our policy at just-drinks and its sister site just-food.com to charge for our content for over eight years now. It is not a strategy that we make any apologies for. We firmly believe that quality journalism, research and analysis is something worth paying for. Moreover, like any quality product, it requires significant investment in order to meet the demands of consumers - our readers.

There are alternatives out there to just-drinks and just-food, many of which are free to view. But, we are confident that the extra levels of investment our subscription model allows us to make result in our titles being the leaders in their sectors. Access to major news stories on the food and drinks industries are available all over the web these days, as information becomes increasingly accessible. But, it is the news stories that a dedicated team of industry experts can uncover, which you won't get elsewhere, that places our readers at the top of the game. And, it's our daily feed of analysis and comment on how these events will shape the industry and your businesses that sets just-drinks and just-food apart from more generic rivals.

As an illustration of our confidence, our sister site just-food - which reports and analyses the global food manufacturing and retailing sectors - is opening its doors today for two weeks, allowing a unique opportunity for non-members of the site to judge our service for themselves. You'll get all the access to our daily news, analysis and comment that full members do, as well as a one-off give-away of food industry research worth over GBP1000 (US$1,600).

All you need to do is follow this link.

Don't forget, that at any time during the two weeks, or indeed after, we would love to get your feedback.

 

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Air cargo bomb threat has far-reaching consequences

02 Nov 2010 11:59

The UK's Home Secretary Theresa May has announced a review of all aspects of air freight security in the UK. The news follows Friday's discovery of a bomb on a US-bound UPS cargo plane at East Midlands airport and a similar bomb on a FedEx plane in Dubai.

It is too early to start hypothesising how this will affect industry in the UK, and the food and drink business ships only a small percentage of its imports by air. Indeed, when just-food questioned the country's retailers back in April, when the Icelandic ash cloud halted air travel, the likes of Asda and Tesco insisted that between only 1% and 2% of its food arrived by air.

However, the food and drinks logistics industry is facing the prospect of tighter security regulations and with it increased costs, at a time when rising transportation bills are already a major concern.

Although the likes of The British International Freight Association have insisted that the UK's regulations are stringent and meet high safety standards, a number of other dissenting voices can also be heard, claiming that the shipping of air freight remains the weak link in airline safety.

So whilst there have been calming calls to resist a knee-jerk reaction to the latest al-Qaeda threat, the political consequences of doing nothing remain too high. The food and drinks industry should brace itself for disruption and an inflating logistics bill.

Are you in the food or drinks logistic business? What are your thoughts on this posting?

Comments on this blog post

Since 99% of wine/.liquor are shipped by sea containers, that is the area for concern. Since only a small % of the containers are scaned, what's to prevent something being put into a case of Johnie Walker?
Norman Weiner USA

 

Norman weiner said at 5:36 pm, November 6, 2010

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Fortune favours the brave

13 Oct 2010 12:56

Pershing Square Capital Management LP has acquired an 11% stake in Fortune Brands, US reports have said.

The hedge-fund firm is led by activist investor William Ackman, who has a reputation for buying stock in companies he deems undervalued and lobbying for changes he thinks will boost shareholder value.

It is certainly a move to keep an eye on, and may spell trouble for the US-owner of the Beam Global Spirits & Wine business.

Ackman led an unsuccessful effort last year to place as many as five board members, including himself, on the US retailer Target's board and also has a history of stirring things up at the restaurant chain Wendy's.

Beam's investor relations team will have their work cut out.

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