Off-Piste eyes up potential partners for US growth
UK supplier and brand owner Off-Piste Wines is eyeing up potential partners to boost its international growth – particularly in the US – which is plans to nearly treble within five years.
The company’s international sales currently account for around 7% of its sales, but chief executive officer Paul Letheren want to boost this to around 20% over the next five years, either by taking on a partner or by buying another small company to accelerate its growth in key target markets.
“With the investment we’re planning to put into the international sales area, we’ve very optimistic we can easily do that,” he told db.
Currently, the company sells into 30 different countries, but Letheren said it plans to focus on four or five countries or territories and make those “really fly”, adding that this was likely to take time, money and resources.
International sales have gone from “nothing to 7% in three years”, he said and although the team could simply carry on doing what they’re doing, “the US is a big opportunity, but that doesn’t come about by being half-hearted about it.”
Letheren said there were several routes of potential investment and the team were looking at all the options, from Private Equity (PE) backing that provided the right fit, to acquiring a small US or UK-based business that had good structure in key target markets that could help with expertise and how to approach selling into those countries.
The key, he said would be in finding the right partnership to facilitate the route to market, leverage its infrastructure and help it significantly capture growth.
“We would only be looking to sell a minority interest in the business, but in return you want to get a proper partner to help us grow,” he said.
The company was in a really good position at the moment, he argued, with its brands, particularly its flagship Most Wanted brand, gaining traction in its existing markets. “Where it’s in, it’s working, so it is worth us spending money, time and resources on,” he said.
“We’re well respected, our Most Wanted brand is flying, and we’ve had some great Kantar data though showing that a younger demographic is switching into it.”
The company is also looking to double its key supply base to around 20 suppliers in order to cater for its expansion, but Letheren said this would be done in a very “targeted” way to ensure that it complements its current range, and ensure the right fit.
“We won’t just double it with people who don’t do what we want,” he said. “We need suppliers to be very flexible and not all are. We’re happy to sell a supplier’s brand, but we also want them to do a supermarket own label and provide wine for our brands,” he said.
“We also don’t want suppliers to be bidding against each other, we do believe in having a partnership, then you get the most out of people and it does work, it’s a win-win.”
It is also looking to bring in a new buyer to boost its buying capabilities, particularly in the Old World side of the business.
However, Letheren said there was still a large opportunity for growth in the UK retail market with its existing supply base, notably in the supermarkets.
“They are already our largest part of the market, but we don’t sell any French wines, for example and there’s more we can do in Spain and Californian. There’s can do a huge amount we can do with our current supply base.“
Convenience was another big area for growth, he said, with the Most Wanted brand – particularly its new canned wines – and the canned Pinot Pinot brand “opening the door” to retailers such as McColl’s, Spar, and more Coops.
“And we don’t really do anything in the on trade at all, it’s something we’re looking at and considering, but it would be national on-trade, we’re not geared to do every pub in the UK, but maybe through the larger chains,” he added.