UK: UK spirits market lacks appeal - Beam Global
The managing director of Beam Global Spirits & Wine in Europe has warned of a potential brand drain from the UK spirits market unless the industry can work together to improve its profitability.
Speaking at today's (15 September) Wine & Spirit Trade Association annual conference, Jonathan Stordy said there was a “crisis in terms of profitability” in the UK but that it could be solved if the industry worked together.
“I would like you to accept that the UK is the least profitable market in Europe,” he told attendees.
Saying he refuted the idea that spirits brands cannot grow in Spain or that the German on-trade was not attractive or innovative, he said that the UK had become obsessed with volumes, adding that his own bosses would begin to question why he was selling brands such as Laphroiag in the UK, when he could sell it for more elsewhere.
“We don't see the collapse in pricing at Christmas anywhere outside the UK,” he added. “This country will become less and less attractive to sell our wonderful brands in.”
His comments were backed up by John Beard, the chief executive of Whyte & Mackay, who warned that some spirits categories had already reached the point of commoditisation, adding that one consequence would be a drain of the sector's top executive talent to other markets.
“Why would a top marketeer choose to work in the UK?” he asked.
Pointing to the increase in legislation surrounding drinks advertising, reduced marketing budgets and the over-reliance on promotions to drive volumes, he said the risk is that top people will not choose to spend their careers in the UK.
Diageo's results last week spelt out one strong message, as far as M&A nut Richard Woodard is concerned. Let's watch him clap his hands and jump up and down as he tells us what he heard....
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