The UK is the biggest spirits exporter in the world, with close to £6bn worth of exports annually, the biggest category within this is whisky. UK is globally renowned for producing spirits in many categories, innovation and quality, so for any producer this time is as good as any to think about exporting. There are many well developed markets for UK brands and, whilst the choice of markets might be confusing and there are risks, the route to exporting is well worn.
As with brands looking into entering the UK market, there are some basic rules to follow when exporting.
Duty
You must be able to produce, store and export your spirit under bond – duty suspended. If you pay UK duty on your spirit, there will be duty levied in the country you are sending it to as well. This will push the price of your goods up too much and this is easily avoided by applying for a WOWGR for your distillery. If you are using a third party to produce your brand you can look into storing under bond with a third party too.
You can easily research what duties are levied on spirits in other countries and do workings on what price your brand will end up on shelf at.
Formats and packaging
Some markets will need different formats for your bottles, the USA and Canada for instance would require 75cl bottles instead of 70cl. Market by market research is needed to understand what labelling requirements there are, in Canada for instance labels will need to be in English and French, and other markets might need different health warnings or unit sizes. Some of these issues might mean too many added costs.
Export partner
If you are not willing to manage the export side of things yourself you might look to employ an export partner agency to develop and manage different markets – they could either be based in the UK or or another hub such as the Netherlands. This will save you a lot of time and potentially grow your business far quicker, however, this will add in an extra margin. They would normally find, negotiate with and manage importers and distributors within multiple markets.
The alternative to this is to find, market by market, import/distribution partners who will import and develop your brand within countries.
In general you would look to have one partner per country, however there might be some examples where one importer looks after a geographical area within a country and another looks after another area (this is common in Italy) or one partner could look after the on trade and the other off trade.
Finding a partner can be hard and working with a reliable and honest partner in some markets can be even harder. The Department of International Trade (DIT) are helpful at producing lists of importers who are trusted within specific markets.
E commerce
With the growth of e commerce and alcohol being sold in various countries online, you might want to look at an e commerce only strategy. You will still need to have an importer into the specific market that you are wanting to develop.
Logistics
Between you and your export partner you must work out a way to transport your stock out of the UK safely and legally. There are many logistics companies who are specifically set up to do this and will carry out all of the customs paperwork at both ends of the trip. You must check though before sending stock under bond, that your logistics partner has all the right paperwork to do so.
Market development
You will have to develop a plan market by market either with your export agency or with your import partners. Marketing and sales support is essential for any brand to survive and grow.