Stock Spirits: mergers, acquisitions and creating value in a competitive market
Stock Spirits Group CEO Jean-Christophe Coutures is focused on growth in Europe but where many are chasing super-premium-plus sales, his strategy is taking a different approach.
‘Premiumisation’ has been the buzzword of the spirits industry for the last decade, you could say, following the ‘drink less, but better’ messaging from the trade.
However, at Stock Spirits Group, premiumisation isn’t quite as pertinent to the firm’s overall strategy – but that doesn’t mean its CEO intends to compromise on quality.
“The industry has beat itself very successful by premiumising its portfolio, and it was about drinking less, but drinking better, which, I think, is a great strategy,” Coutures says on this week’s episode of The Spirits Business Podcast. “There is a space for this – and there is a space as well for companies which want to offer consumers the best value-for-money brands.
“So, we don’t want to compromise in any way in the quality of what we offer to consumers, but we want to make sure that we do that at the right price.”
To ensure standards are met, Stock Spirits Group has invested heavily in its production processes in recent years. In July, the company opened a logistics centre and distillery in Lublin, Poland, to increase its operational efficiency in the long term. It will also give the group greater control over its vodka production.
“At the same time, we are tracking efficiencies in all our processes to make sure that we eliminate any waste we will have in our value chain,” Coutures adds. “Why that? It’s to make sure we can keep our brand affordable and we can make sure that consumers can find their key, iconic local brand at the right price in the market.
“So, for example, in the last year, we have not increased our price, except when there were excise increases, to which point we had to bring, unfortunately, the excise [increase] into the price. But we always try to tap into this moment where consumers want the best value-for-money brands, especially in the current context where there is pressure in their purchasing power.”
Balancing prices against economic headwinds and low consumer confidence
He goes on to discuss the current economic headwinds and their impact on consumer confidence and spending at present.
“There have been several economic cycles throughout the last 30 or 40 years,” he explains. “You had some cycles during which there were economic crises; the 2008/09 crisis, which basically was very difficult at that time. You had a lot of unemployment and a lot of economic uncertainties, and consumers were really questioning and very choiceful and mindful in spending their money.
“When you are in a downturn economic cycle, it’s very important to create a trustworthy relationship between your brand and the consumer because the consumer will be more mindful in choosing brands they trust, and they will probably be exploring less and going back to what they believe in.
“This is why our strategy, which is based on the iconic local branding market – Božkov in Czechia, Żoładkowa in Poland, Clan Campbell in France, Limoncè in Italy – is making sure that our brands are brands consumers can trust and they go to because this is what they want to drink when they are questioning what they really want in those difficult times.”
This episode also covers Stock Spirits Group’s investment in Scotch whisky and the latest update on its distillery building in Scotland, and its recent acquisition of UK distributor The Drinks Company.
Coutures also explains why he believes the company is in good shape to weather the current challenging and geopolitical climate, and explains why the group’s sustainable practices will be equally as important to long-term financial success as new product innovation.
Listen to The Spirits Business Podcast on all major streaming platforms, including Apple Podcasts, Spotify and Amazon Music. The series is also available for free via Acast, and via the link below.
Recent episodes have featured Nick Gillett, managing director of Mangrove Global, who talked about how to remain profitable in a turbulent economic environment. Claire Warner, head of luxury advocacy at Diageo, was also a recent guest, and covered building brand-bartender relationships, health and wellness, finding balance, community, and career success.
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