Memoirs.....Musings of a sales guy at heart.....

Episode 41...

Geoscope journey....

I posted the UT of Pondy episode no 40 few days ago to select groups who are in the trade/business and based on certain feedback just adding a few points...

My team, especially the guys who were based at DeeKay unit, went thru a torrid time and the unit manager of DeeKay could do nothing without taking his boss's consent and most of the time it was a never ending ping pong game....the room for our guy allotted to them was un-livable with no provision for the rest room....they have to walk up to the security gate to use the common facility.

Our manufacturing was headed by Kumaran for a couple of years....he had two stints with us....the first was as unit manager-MBDL....he left and joined back as head of mfg...a good guy, very focussed and quick learner....he left us for good and started his own consulting....which is fine absolutely....Ravi of DeeKay sought his consulting on some brand n blend development....since we stopped supply of the French Grape Spirit raw material to DeeKay he made Kumaran to touch base with our Bardinet in France and set up a meeting with Ravi's son who was in France then....and Bardinet, as mentioned in my post earlier, a great partner, wrote to us stating that DeeKay is looking for direct supplies and some one is meeting him. I told Bardinet that they should not encourage this as we have a contract with them as exclusive buyer and seller for the bulk spirit...and it was promptly conveyed to DeeKay too.....Am saying this because, Ravi of DeeKay learnt a lot during our association with him on the nuances of our blends and also our world class presentations....Only the composition would be known to us but the rest is open....its a kind of knowledge bank....the bottler is not supposed to copy or replicate...this is professional ethics....Since our supply of the raw material to DeeKay is stopped he must be using something else now and hence the character of his final product would not be the same as before....

Also our own distributor was approached, when DeeKay was bottling our brands, that our brands can be given at half the market price...just to test whether it was true he ordered with that person a couple of cases and he got it at half the price...this is the way his factory was run....

Ravi and self, as written earlier, been friends from 1994.....when Ravi n Ramamurthy started RR....My trips to Pondy wont be complete with out a meal with Ravi.....and during his trips to Chennai too...both our families are also well bonded....also when I was in Bombay and in Dubai and during my trips to Chennai, Ravi used to spare his car for me with his driver Srinivasan....and during my trips to Pondy after the start of Geoscope, I used to spend minimum an hour with Ravi in his office discussing general things....in hindsight, I realise, I should have never gone for a bottling tie up with DeeKay. This has completely spoiled our friendship....sad but true.

Our case against ST department of Pondy is now 2 years old....first 6 to 7 months the department didnt even respond and later they came out with some defence....but the case is still lingering....this reminds me of the adage...'justice delayed is justice denied'......50 lakhs, our hard earned money, is languishing in BOB.....

This leaves a big question mark....if you are a small player, everyone wants you to remain small only......especially in this industry.....and those whose mercy you are in as a contract bottler, enjoys life in your expense....

I have also written in my earlier blog on how I enjoyed working in UT of Pondy....today the excise department of Pondy has decreed that no promos on alcohol to be conducted and if anyone found doing it, they would be penalised....this means big companies like Tilak Nagar, Diageo-USL and PRG would only stand benefited as they are well established and their brands enjoy maximum consumer franchise....small players have to now think outside the box.....Pondy excise is now clueless and they are completely oblivious of ground realities.....sad, a good market is now being spoiled....Also as mentioned in my earlier report, the covid tax which was introduced in 2020 is still continuing in Pondy the consumer prices of premium brands very high and hence no more attractive for the travellers.

Over with UT of Pondy......

And we kept expanding in to other markets too....We registered our LR Whiskey in Nigeria and started our supplies....Nigeria is a different kind of market....I had visited Nigeria a few times and I was quite surprised to see liquor being sold by the street vendors.....since the import tariffs are high and also the entry barriers, many customers bring stocks to the neighbouring countries and sneak it in to Nigeria....But we registered our brands and did some decent business but after the local currency got totally jacked, the business has come down badly in this, otherwise, huge and potential market....We sell in Bahrain and UAE.....Truebell is our authorised distributor in UAE....We have also sold a few containers directly to AbuDhabi National Hotels. The problem in UAE is getting entry in to the retail stores of AnE and MMI...also in Northern Emirates, Holiday Marines owned by Thampi and run by Gopan is very strong in the RTM and they have all the leading brands...despite my great rapport with all these customers could not get in to their outlets....this is another market if you have the right distributor with a very clear understanding of the RTM you can do well.

When I was in W&M, Lala and Rekhi, during one of their visits to Dubai asked me to do a project on IMFL in UAE and submit a report to them with my recommendations on RTM...thats the time I gone very deep in understanding how this RTM works for IMFL in UAE and got some ideas....During that period CeeCee was the sole distributors for USL and they were getting roasted by ABD's Officers Choice and also Seagram's (PRG) brands viz Royal Stag and Blenders....ABD gave their distribution to Thampi and Seagram kept the market open...I gave a white paper to Rekhi....flew down from DxB and met him in his office, in Blr....I recommended that they split the portfolio and offer the distribution to Truebell, Thampi and Bhatias-(Bhatias were strong that time)....The report bit the dust as USL's export business that time was handled by UB exports and they didnt like this idea. If it was USL's direct business, my recommendation would have been taken seriously and Rekhi and Lala would have executed it to perfection and USL would have gained immensely. But a few years ago, DiageoUSL did what I had recommended then. In general despite basic scotches selling at much cheaper at retail and almost on par with Indian brands in terms of consumer price, the IMFL category is still huge in UAE and also in Oman and Qatar.....but relationship is very important in these markets to get a share of the pie and also a good understanding how the consumers behave.

We started off with Le Roi' whiskey, brandy and Clovis with Truebell...but during my market visit some wholesalers opined that since our LR bottle was round in shape it is not picked up by the RTM guys and that made us to think and we brought in a square bottle exclusively for export....and TB did a good job in distribution but our luck was so bad, that Sanju who was heading the sales in UAE moved to ABD and all the efforts put in on LR fell apart....TB that time was distributing some vodka made in India and that company ran in to some financial issues and they were looking for another one....we decided to chip in and created our Wassup #Trendy Vodka....we used the same bottle of Hobsons with a wrap around label and bartop. The packing is fantastic. We created Chocolate, Orange and Green Apple all for UAE and export...we even exported some Chocolate to our customer in Nigeria....Something is not destined to happen for some market but the destiny takes it to other places....today we are selling Wassup # Trendy Vodka in TN and its doing decent numbers too...

I visited Indo China to explore the possibilities of selling our brands there and Sim David, a Singaporian, an ex Diageo connected me to one of the biggest distributors in Vietnam....spent around 3 days going around and understanding the RTM there.....

From Gemini we started selling to Chattisgarh. This market was originally an open market and the retail and WS were auctioned. The market was good but huge efforts for getting the money back. BJP government sometime in the mid 2000s took over the WS and later the retail too....this opened up the doors for small players like us. We started with our LR Whiskey and it was an instant hit. Sudeep did a great job in this market. This is the first market to introduce track and trace system...this means that from the point of production to the point of sale every single bottle would get tracked and you would know the stock position at the depot level, retail level and also how much you had sold....this is a fabulous piece of work done by Chattisgarh under BJP's Raman Singh. We supplied initially from our Gemini but Gemini failed us due to many issues. Our partner Vishal purchased a bottling unit in Raipur, which was defunct and built it from scratch and created a world class bottling plant in no time....we are currently supplying from this unit and selling almost the entire portfolio sans our brandies...(this market is not for brandy)

Sometime in 2018 we felt we should create a super premium whiskey and started working on that. We moved away from our earlier blender and to Janardhan Menon with a high pedigree in this field, an ex USL person....our LR whiskey, Wassup Vodka, GPL whiskey and GPL VSOP are all his creation only. But we wanted our whiskey blend to be unique and started searching for someone with skills which are world class and stumbled upon Prabhat Barik.....

He first created our GPL XO which is still the best in its segment, he is a thinker and technically super qualified. Our brief to Barik was that our whiskey should be different from others and consumers should feel the smoothness and an aroma which is very Scottish. Also we requested him whether he can get for blending Scottish malt matured in Sherry Cask....and blend it with imported Scottish grain.....it was a tough task but he came out with this brilliant blend.

Ashwin Deo, whom I knew from my UB days and also a great colleague from IDV?Diageo time. He shifted his base to Nagpur and was in to instant food business....he joined us and was with us for a short duration but contributed a lot in Maker's in terms of conducting the consumer research on the blend and also assisting us on the presentation. (sad he attained the golden feet of the creator a couple of years ago)....The blend n presentation came out very well...and I put on my thinking cap and wrote down the brand story....

Vishal, in partnership with another person, participated in the auctions in Punjab and got around 100+ shops across Jalandhar, Mohali, Amritsar and Ludhiana....and at the same time, Diageo walked out of the bottling plant of Vishal which was at Moonak. That left a vacuum. We felt there is an opportunity for our brands and started bottling our GPL Premium Whiskey and launched it. Also in Dec 19 we started bottling Maker's Delight in Moonak and launched it in Punjab. I personally handled the launch as Sudeep could not make it. Punjab is a tough market with cartels controlling the business in the retail trade. Cartels have their own interest and hence support those brands which are either distributed by them or they have a stake in that. Its a big market for Premium brands. No function in Punjab can go off with out alcohol. I have seen consumers buying in cases during festive times.....

Also when it comes to hospitality no one can match the Punjabis....I had a taste of their hospitality during the launch of Maker's (!). One cant leave the wholesaler's office with out tasting the local delicacies....it would offend them....I went to meet a WS just before lunch and after our half an hour discussions when we said we were leaving, we were asked not to leave and they served lunch immediately with all available options. This means that the moment we entered, they ordered these thru one of their staff and the food came in no time. And their lassi is something one should try....and the local sweets.....and when you drive thru the country side, during Nov/Dec, you would get jaggery spiced with ginger and cardamom.....another delicacy.....And the 'langar' at the Golden temple.....Punjab is a great place but the business is a bit complex.....the excise department works with a target.....and its export friendly state.....

We have explored options in other northern states and especially UP. 

UP is one state where the alcohol business was a kind of money spinner for a couple of big persons only. Yogi's government took the initiative and changed the policy in such a way, entry for every single player was made easy. We are yet to launch our brands here but am sure it would happen soon.

Currently we are available in TN, UT of Pondy, Karnataka, Telangana, Chattisgarh, Goa, Punjab and Delhi. 

We entered Kerala few years back and retrieved as we started losing money heavily due to the huge entry barriers.....its sad government is only looking at their revenue and not bothered about the suppliers predicaments especially that of small players. We had a taste of this....we still have to get some money from the corporation. They also introduced some 3 decades ago, turn over tax on local production....this made a huge dent in the bottom line of all the local bottlers.....I heard, recently, they had done away with this.....Kerala taxes are highest in the country and 90% of the market is cheap alcohol......

We are exploring Maharashtra, MP and Rajasthan but the entry barriers in these states are still a nightmare for small players.

We submitted our application to CSD in 2014 and we got our first brand approved a couple of months ago.....

In the last 13 years we have been exploring many options and still are....we have fantastic world class brands in Hobsons, Clovis, Le Roi' brandy and Whiskey, Geo's Premier League VSOP, XO and Premium Whiskey, Wassup Vodka, GPL VSOP and Maker's Delight.

We are proud of our creations and are confident soon these brands would scale new heights.....

I learnt a lot in the last 13 years as a entrepreneur. The foundation was well laid with my stints in HL-UB, IDV/Diageo and W&M.....

Next episode would be a different one....

Till then Au Revoir!