Halewood champions vodka to raise prices
The industry can enjoy a healthier margin from the vodka category if it comes together to drive value into the sector, according to a leading drinks producer.
Stewart Hainsworth, chief executive of Halewood Wines & Spirits, believes vodka can enjoy the price points gin commands if the trade puts more work into it.
He said: “There is very little margin in vodka because of price discounting by the multiple retailers. With our vodka portfolio, we are trying to do the same as we have done with gin, which is to offer something at all price points. But we are still getting there.
“If we are looking at long-term profits we need to look at other categories. You can make money at the bottom end of the gin category but it’s hard with vodka.
“Generally the vast majority of vodka drunk is still below £15 and the profile of a typical drinker is still very young. What I would like to see is people being a little more discerning about what they are drinking. There are different tastes in vodka and the category needs to take some of the learnings from gin.”
Hainsworth said the company’s JJ Whitley Rhubarb Vodka has been doing well and, with a price point of £17.99, it aims to bridge the gap between the lower-priced, entry-level options and premium brands.
The JJ Whitley brand is sticking to British flavours. “We are looking at a nettle gin,” Hainsworth said. “We are investing heavily in the craft side of our business because that is where we can be different.”
Halewood aims to enable independent and convenience retailers to offer something different from the multiples and at competitive prices. “From Halewood’s point of view we are in various categories – RTDs, spirits and wine – and we have products for convenience stores and the multiples. Small corner shops tend to go with what is safe but we are trying to say to those guys: ‘You have to have a point of difference’.
“The fact that we distil our own potato vodka is interesting, for example, and we have that craft approach that people want nowadays.”
Halewood is also looking to invest in its Liverpool gin range and has recently added Liverpool vodka, as well as a limited-edition Liverpool rum, which comes from Trinidad but has spent one year ageing in docks at Liverpool.
“We sell a lot of Liverpool gin in Merseyside but we want to move it into other parts of the country now. There are not many brands that have docks, the Beatles and two football teams, so as a city it punches above its weight. It’s a brand we can develop.”
Another area Halewood has been looking at is fractionals. “It has been difficult because pricing is under pressure for fractionals. We have been looking at how we can be different, and that’s why we went into cans with Crabbies and Red Square.
“Another plan is to launch Irish whiskey in fractional formats.
“When you walk into a convenience store you won’t see many smaller formats in Irish whiskey but you will see tons of Scotch ones. So that’s a way we can help these retailers so they don’t just look like the shop up the road.”