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Select Brands plans to enter rum market

Published:Friday | March 1, 2013 | 12:00 AM
Andrew Desnoes displays one of the 156 products that Select Brands Limited started distributing from its warehouse on Spanish Town Road, Kingston, in November 2011. - Gladstone Taylor / Photographer

Steven Jackson, Business Reporter

Select Brands Limited has more than doubled the wines and spirits it distributes to 400 products, following 15 months of operations.

The company, which began distributing just over 150 products, now considers itself a market leader and plans to launch its own rum within a year in a bid to garner export earnings.

"In short order, we have become an established player, one of the dominant players in imported wines and spirits," said co-owner Andrew Desnoes.

He added that in the "absence of formal statistics", Select Brands would refrain from claiming the number-one spot.

Wines and spirits make up a small fraction of the more than US$200-million alcoholic beverage market dominated by rum and beer, according to overseas data from Italian-based Campari Group, which recently acquired Jamaica's top rum producer Wray & Nephew Limited, among other assets of Lascelles deMercado.

Select Brands is controlled equally by Andrew Desnoes and David McConnell through a St Lucia-registered company called Ringtail Holdings. The partners previously worked with the Lascelles group.

Desnoes declined to reveal sales or target. However, Select Brands at launch stated plans to generate J$1 billion in annual revenues within its third year. The confidence comes from Select Brands' management team with decades of wines and spirits experience, recent brand acquisitions from competitors and its sizeable warehouse spanning 18,000 square feet on Spanish Town Road in Kingston.

Some of the brands include El Dorado rum, Hpnotiq liquor, Harveys wine, Stolichnaya Vodka, Glenfiddich whiskey and Highland water.

Strict price management

Desnoes indicated that currency movements have affected operations, forcing strict price management. The dollar, which was trading at J$86.60 to the USD when Select Brands began operations in November 2011, has since fallen to J$97.10/USD.

"We have had to make small incremental price increases with movement of the dollar. However, a lot of the hotels currently pay in US dollars and that certainly helps. We are also trying to make clients pay on time," he said.

Select Brands distributes wines and spirits from Argentina, Australia, Chile, Germany, France, Italy, New Zealand, South Africa, Spain and US, according to its 2013 portfolio catalogue.

"The past year we have been working hard and have received a good amount of success. We have been busy sourcing brands and deepening our distribution network," said Desnoes.

Select Brands aims to make a rum to compete locally and internationally. The company's partners had initially said they would have avoided direct competition with Wray & Nephew, producers of Appleton and other rums.

"Our medium-term plan is to have our own brand," said Desnoes. "It would be a brand of international quality. I would be surprised if by 2014-15 we do not have our own brand."

The company will decide whether to contract a rum distiller or build its own.

"We could form a joint venture; we could buy a distillery or contract manufacturing. But for us we are not there just yet; we are putting everything together," said Desnoes.

"Our plans are that by 2014-15 we should have a rum, and by that time Jamaica's economic uncertainty should have settled down."