Operations

6 Things New Liquor Brands Should Know

Importers and distributors offer long-term relationship advice to new beverage alcohol brands

Photo credit: Kievith / iStock.

Beverage alcohol brands have to tick a number of boxes before importers and distributors will consider committing to a business relationship with them. These days, any new beer, wine, or spirit must bring with it a compelling story, well-designed packaging, and quality—consistent, replicable products. But those elements are only the beginning. When seasoned buyers are vetting potential producer partners, they rely on both quantitative data and qualitative instinct before they put pen to paper, and there are certain things they want liquor brands to know.  

1. Shortcuts Are a Turnoff

Today’s consumers of alcoholic beverages are acutely attuned to the ingredients and production protocols that go into crafting their favorite products, so it’s no surprise that ingredients play a significant role in the brand selection decisions being made by importers and distributors.

Ingredients rank high in the selection process for Heavenly Spirits, a Lakeville, Massachusetts, importer of beverages distilled in France, including Armagnac Marie Duffau, Armagnac Delord, Cognac Jean Fillioux, Calvados from Claque-Pépin Distillerie, and single-malt whisky brands like Armorik and G. Rozelieures. French-born Christine Cooney, who cofounded Heavenly Spirits with her husband, Daniel, is not a fan of Armagnac distillers who flirt with the predetermined limits on added sugar. “When a producer says, ‘I put three grams of sugar in Armagnac, which is the maximum allowed,’ I don’t like it,” she says. “A little is okay, but not the maximum.”

The same applies to aging standards. Cooney isn’t interested in working with a producer who bottles a V.S. Armagnac once it satisfies the bare minimum age requirement of one year, or a V.S. Cognac producer who bottles at the two-year minimum. At Heavenly Spirits, the emphasis is on quality over expedience. “The big houses,” she says, “do it because it’s all about money, but we do something different.”

2. Communication Is Key

The manner in which companies choose to do business can be just as important as what kind of business they do. “It really comes down to the people,” says Kurt Strickmaker, who in 2010 founded the craft-only beer distributor Bounty Bev as an alternative to the macro-focused beer distribution houses. Bounty brings craft brands to eight counties in and around the greater Nashville area. “I don’t want to work with people who are just out to make a quick buck,” Strickmaker says. “We’re in a position where we can work with people we like, people who have great ethics and a moral compass.”

And those same kinds of brand producers are themselves often looking to work with like-minded importers and distributors. Allison Parc, the U.S.-based founder of the French single-malt whisky Brenne, wouldn’t have it any other way. Before she signs on with an importation or distribution partner, she likes to get a sense of the way the key decision makers think. “I want to see how they conduct themselves in business,” Parc says. “I want to see what kind of values [are present] in the way they operate. It could be as simple as how they communicate with people.”

The need for effective communication between trading partners seems like a no-brainer, but Strickmaker notes that a surprising number of beverage producers still don’t get it right. And that’s a nonstarter for Bounty Bev. “If we aren’t constantly talking with our supplier partners, we’re not going to grow together,” Strickmaker says. “We’re going to go with the other guy, who’s bending our ear.”

3. Support Is a Two-Way Street

For many distributors, it’s a deal breaker when a brand owner expects the distributor to do all the heavy lifting for promotions. Strickmaker says he instantly turns brewers away if it seems that they’re only interested in shipping beer to his facility without any real marketing commitment. He says, “I pass on them immediately.”

Another thing that puts the brakes on negotiations with Bounty is a brewer’s demand that the distributor cover 100 percent of the point-of-sale material costs. “You need to co-op everything,” Strickmaker explains. “You’ve got to have skin in the game. It’s a partnership, a marriage, and we’ve got to take care of each other.”

As a brand supplier, Parc looks for a similar give-and-take relationship with her trading partners—especially since specialty brands and boutique importers and distributors are likely to have limited resources. She tries to avoid working with companies that apply a large-brand mentality to small producers. “They’re not willing to contribute any part of their margins to the support or promotion of the brand and, instead, on top of their margins, are asking for a significant amount of money for market support,” she says. “That’s not good or bad, it’s just a very big-brand way for a distributor to operate, and it’s not always feasible for the small guys.”

4. Momentum Helps

Beyond tangible resources like marketing spend, there are intangible factors, like “buzz,” that tend to be more qualitative than quantitative. Still, there are specific data points that help importers and distributors determine how much wind is in a brand’s sails. Social media presence is one indicator. Importers and distributors are interested in whether a prospective brand is active on all the relevant platforms (Instagram, Facebook, Twitter, and the like), if it has a significant number of followers, and if those followers regularly engage with the brand.

Strickmaker also looks at scanner data—usually available from market research company IRI—on states closest to Tennessee in which the prospective brand already has a presence. “I want to see some form of data,” he says, “so I can feel good about partnering with [that brand].”

5. It’s Not All About the Numbers

Managing expectations is a critical part of any relationship. But when those expectations seem unrealistic from the get-go, that’s a major red flag for Heavenly Spirits. Cooney finds it disconcerting when a producer starts asking about what kind of volumes can be expected before any kind of deal takes place. “That really upsets me,” she says. “We actually experienced this, and we had to turn away from a couple of great products. If they start thinking that all that matters is volume, then they’re not for us.”

It’s especially difficult to talk about volume when the brand has no preexisting presence in the U.S. market. “I can’t take a product that’s sold zero bottles and have them say, ‘What do you think you’re going to do with [it]?’” Cooney notes. “We don’t want to commit to volumes until we sell the first bottle.”

Craig Hartinger, the marketing director for the Seattle-based specialty beer importer Merchant du Vin, which imports brands such as Belgium’s Westmalle, Rochefort, and Lindemans; Germany’s Ayinger; England’s Samuel Smith’s; and Scotland’s Traquair, says he’s also averse to such interactions because they set the tone for a potentially rocky relationship. “We don’t play the ‘We need this number right now’ game, which is quite common in the beer business,” he says, adding that if you talk to a beer supplier, there’s often a whole ritual involving how many accounts the supplier thinks he or she needs and when the supplier wants them by. “We want to build the brand,” says Hartinger. “To build the brand, we’re not looking for short-term sales gains—and we don’t buy sales.”

When importers and distributors promise that a certain number of cases will be sold in a specific number of accounts by a particular date, they must often resort to deep discounts to hit those targets. Hartinger contends that that’s the enemy of long-term relationships. “If you play too much on price, you’re jeopardizing your future sales,” he says. “If [a case] is $20 this month but $30 next month, I’m thinking [the account] is going to buy it this month, but the volume’s going to drop next month.”

6. The Product Must Fit the Portfolio

A beverage brand could tick all the boxes detailed above, but it still might not be a good fit for a prospective partner. Importers and distributors need to make sure a particular product is right for their portfolio.

When seeking a new product, Cooney looks for one that’s not only “unique in and of itself” but unique within the Heavenly Spirits portfolio. “We have four brands of Armagnac in our portfolio, and they’re all very different and don’t compete with each other,” she says. “They’re different styles, different flavor profiles, and made through different production methods. Our consumers are very discerning, and they often like one Armagnac over another.”

Similarly, Merchant du Vin is not eager to load up on beers whose styles are already represented in its portfolio. “We don’t need any more Tripels,” he says, noting that Westmalle Tripel is already a highly respected and strong seller in its category.

But even if a product offers something new to prospective buyers, those buyers may still turn it down because they don’t want to divert their focus. “When we get solicitations from breweries,” explains Hartinger, “one thing we sometimes mention to them is that we’re intensely focused on our current portfolio and we’re not brand collectors. We’re focused on all of the beers we have, from the smallest to the largest. So if someone from a small brewery inquires about [our] picking them up, we’ll let them know [that] those are our main priorities before we pick up any new brands.”

Vetting potential producer partners is a nuanced business. No two brands, importers, or distributors operate—or make decisions—in exactly the same way. But creating quality products, doing due diligence, and being a good communicator and team player can go a long way in forging long-term partnerships that benefit the buyers and the brands.

Jeff Cioletti is the author of the books The Year of Drinking Adventurously, Beer FAQ, and the upcoming The Drinkable Globe. He is the founder of the beverage travel video site The Drinkable Globe and a frequent contributor to a number of publications, including FSR Magazine and Beverage Media. Jeff is a Certified Sake Adviser and the winner of two North American Guild of Beer Writers awards.

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