Getting on the list

24 July, 2014

It is common practice for brands to offer incentives to bars in return for a listing and this works in everyone’s favour – but does it mean smaller players miss out?  Hamish Smith investigates

 

IF YOUR NAME'S NOT ON THE LIST, YOU'RE NOT COMING IN. Unless, that is, you pay tens of thousands of pounds, contribute to a refurbishment, or offer free stock.

Selling spirits in the on-trade is a complex business. The idea that a bar owner simply sells the spirits he wants to, based on the suitability of the liquid, is quaint at best – there are manifold other considerations that have nothing to do with the product. 

Of all the spirits, vodka is where the volume is at so tends to be the deal-maker – the salesman of the portfolio who comes with an open jacket of incentives. But this is a symbiotic relationship and you certainly don’t tend to hear bartenders complaining.

So how do the deals work? One high-profile cocktail bar operator in Moscow tells all: “I choose my vodka by whichever gives me marketing support. Generally it is a big brand. I have bosses to report to, they want me to bring money to the house to finance marketing. No matter what brand I like or believe is worth having on a speed rail, I choose brands that support us in marketing. It is a win-win. We help their image grow and they do the same for us.”

Over at the chain London Cocktail Club, JJ Goodman tells how he runs things. “Our main focus is retrospective investment (eg for every bottle we buy, the brand may give us £x, which is paid after purchase. The more we buy the more we get), which is ideally in cash, but we’re happy with stock. For any special listings, such as bespoke glassware, we require an upfront investment to cover wastage. But marketing is a big one, for companies with a large network we might make concessions.”

In much of the world (although not the US, which has stricter rules on incentives) this is the trading environment that vodka brands find themselves in – by their own making or not. For brands that can pay, fine, but there is a barrier to entry that stifles new blood. For a category whose coolness is sliding among top bartenders, smaller craft brands can play a role in invigorating the category. 

Konik’s Tail, now distributed by Speciality Brands in the UK, is one such brand. Creator Pleurat Shabani has found that hand-selling is his only route into jam-packed back bars. “Bartenders have become jaded,” he says. “Sometimes I wonder who does the finances [at big brands]; how they make any money. They give away so much stock, plus listing fees and staff incentives. It’s the battle of the giants. If one pays £100,000 [for a contract] the other will try to gazump them. I also sell in Italy and France and the behaviour is exactly the same. “I try to build personal relationships with the trade through training, masterclasses and the bartenders I work with show me loyalty in the face of blank cheques. They know it’s not about money.” 





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