How Can UK Craft Distilleries Develop an Export Strategy for European Markets?

April 15, 2024

As the UK’s craft drinks business burgeons, there is an immense potential for growth in the global export market. Particular attention goes towards the distilled spirits sector, most notably whiskey, gin, and other craft spirits. This article aims to thoroughly explore how UK craft distilleries can design a strategic export plan for the European market. We will delve into the current market scenario, the trade dynamics, the role of craft distilling, and the future prospects of this industry.

The State of UK’s Craft Spirits Market

The UK craft spirits market has seen a significant surge in the past decade, with the rise of a more discerning drinking public. This trend has been further fuelled by the renewed interest in locally produced, high-quality distilled spirits.

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Gin and whiskey, in particular, have seen an unprecedented growth. The distillery business has seen a boom, with the number of craft distilleries in the UK increasing significantly year on year. The spirit of craft distilling has truly taken over the UK, introducing new flavours, techniques, and innovation to the spirits industry.

However, the domestic market alone may not be enough to sustain the growing number of UK craft distilleries. Developing an export strategy for European markets hence becomes a crucial part of their business model. With the large and diverse European market offering promising opportunities, UK distilleries will need to navigate the trade dynamics, understand the tastes and preferences of the European consumers, and adhere to the various regulations in place.

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Understanding the European Spirits Market

Europe is a major player in the global spirits market. Countries like France, Italy, and Spain have a rich history and culture of wine and spirits consumption. The European consumer is not only interested in the spirit itself but also the story behind each craft distillery, their process of distilling, and the unique flavours they bring to the table.

However, it’s also an extremely diverse market, with different countries having their preferences when it comes to spirits. While whiskey might be the preferred spirit in Ireland, gin is extremely popular in Spain. The UK distilleries need to tailor their products according to the tastes and preferences of each specific country.

Understanding the European consumer’s shift towards premium and craft spirits will play a crucial role in developing a successful export strategy.

Navigating Trade Dynamics

Entering the European market also means navigating through the complex web of international trade regulations, tariffs, and duties. The distilleries need to understand the import duties and regulations of each European country they plan to export to.

Post-Brexit, the trade dynamics between the UK and EU have changed considerably, with new regulations and tariffs in place. It is essential to keep up-to-date with these changes and adapt the export strategy accordingly.

UK distilleries also need to establish strong relationships with distributors, retailers, and on-trade partners in the European markets. They need to collaborate with them to ensure that their products reach the right consumers.

Crafting a Compelling Brand Story

Craft distilleries have a unique advantage when it comes to their brand story. Their spirits are not just products, they are the embodiments of their passion, dedication, and craftsmanship.

The European consumers value this authenticity and story behind each craft distillery. UK distilleries can leverage this to create a compelling brand story that resonates with the European consumer.

Whether it’s the unique process of distilling, the locally sourced ingredients, or the family-run distillery’s history, distilleries need to effectively communicate this story to their target audience. This not only helps in building a brand identity but also in differentiating their products in a competitive market.

Harnessing the Power of Digital Marketing

In today’s digital age, marketing strategies have shifted from traditional methods to digital platforms. Social media, online campaigns, influencer marketing, and virtual tastings have become the norm, especially in the spirits industry.

Harnessing the power of digital marketing is crucial for UK distilleries planning to export to European markets. By establishing a strong online presence, distilleries can reach a larger audience and engage with them effectively.

In addition to this, distilleries can also use digital platforms to educate consumers about their products, their distilling process, and their brand story. This helps in building a loyal customer base, which is vital in a new market.

Developing a robust export strategy for the European markets is not a simple task. It requires a deep understanding of the market, an effective brand story, and the ability to navigate complex trade dynamics. However, with the right strategy and approach, UK craft distilleries can tap into the vast potential that the European spirits market offers.

Tackling Distribution Channels and Packaging

When it comes to exporting, an essential part of the strategy is the establishment of credible distribution channels. The accessibility of craft spirits to the target market is often determined by how well a distillery can penetrate the supply chain of a foreign market.

For UK craft distilleries, particularly those in Northern Ireland where there’s a strong tradition of whiskey production, understanding this aspect of the market is crucial. However, this does not solely revolve around making connections with European retailers and on-trade partners. It is also about offering a product that meets the demands and expectations of the European consumer.

An aspect that plays an influential role in this context is the marketing packaging. Packaging is a powerful tool that communicates the brand story and the quality of the spirit. Therefore, distilleries should pay careful attention to the design of their labels, bottles, and even the type of cork they use. This is especially important for craft distilleries, as the European consumer is attracted to the distinctiveness and authenticity associated with craft-distilled products.

Additionally, the packaging should meet the regulatory requirements of the European Union. Distilleries should be aware that different EU countries may have different rules and regulations pertaining to the labelling and packaging of distilled spirits.

Strengthening Trade Relations Post-Brexit

In the post-Brexit era, the trade relationship between the United Kingdom and the European Union has faced severe changes. The introduction of new trade deals, tariffs, and regulations has caused a seismic shift in the export strategy of UK-based companies, including those in the drinks industry.

Craft distilleries planning to export their products to European markets must be cognizant of these changes. It is crucial to understand the specifics of the trade deals and how they affect the export of spirits. For example, the trade deal may influence the cost of exporting, which, in turn, can impact the pricing strategy of the distillery.

Moreover, distilleries should be proactive in liaising with trade bodies, both in the United Kingdom and the European Union, to stay informed about any changes in the trade landscape. These bodies can offer valuable advice and updates regarding trade regulations, import duties, and tariffs, helping distilleries adapt their export strategies accordingly.

Conclusion

In conclusion, the potential for UK craft distilleries in the European market is vast. Despite the challenges, such as diverse consumer tastes, strict regulations, and post-Brexit trade dynamics, the opportunities far outweigh the hurdles.

Craft distilleries in the United Kingdom, from the producers of American whiskey in the urban centres to distillers of Irish whiskey and single malt in Northern Ireland, all have a unique story to tell. This, combined with the quality and authenticity of the craft distilled products, is what European consumers are attracted to.

However, to tap into the potential of this market, distilleries need to construct a comprehensive export strategy. This strategy should encompass understanding the consumer, navigating the complex trade dynamics, crafting a compelling brand story, harnessing digital marketing, and tackling distribution channels and packaging.

With the right approach and a well-rounded strategy, there is no doubt that UK craft distilleries can make their mark in the European market and contribute significantly to the growth of the country’s spirits exports. This will not only benefit the distilleries themselves but also strengthen the global position of the UK’s drinks industry.