Cuervo: Diageo split has created better opportunity21st November, 2013 by Becky Paskin
Jose Cuervoâ€™s split from Diageo earlier this year has created â€śa real opportunityâ€ť for the brand to align itself with â€śmore like-mindedâ€ť distributors, its managing director has said.
The family-owned Tequila company parted ways with its global distributor Diageo in July this year, after the pair failed to come to an agreement over a takeover deal.
The decision, announced in December 2012, left Jose Cuervo with just six months to arrange new distribution partners across 34 countries.
â€śIt was quite hard to find partners that fit in with Jose Cuervoâ€™s philosophy, but the whole process became fascinating because it was like speed dating the industry in many senses,â€ť Jose Cuervoâ€™s managing director international told The Spirits Business. â€śBut in most cases we were in the fortunate position of choosing a pretty good suite of candidates, certainly in the major markets.â€ť
Gutierrez added that the split from Diageo has forged an opportunity for the group to â€śreally strengthen our route to marketâ€ť.
â€śMy intention was to establish a new network built of more like-minded distribution partners,â€ť he said. â€śWeâ€™ve ended up with a stable almost entirely made up of owner-managed businesses with an entrepreneurial spirit, with a lot of them family owned that frankly mirror our culture to a far more significant extent than Diageo. It means that we get each other a lot better.â€ť
Cuervo has now secured new distribution partners in almost every market since the changeover, with the exception of â€śabout 8,000 cases that remain homeless,â€ť which Gutierrez assures is â€śnothing, a pin prickâ€ť. The group sold 5.6million cases in 2012, a 2% increase on 2011 volumes.
He added that for the year ahead, Cuervo will be concentrating on â€śexecuting the basicsâ€ť, rather than expanding distribution, with a focus on ensuring the brand continues to grow at twice the rate of the Tequila category.