WHISKY giant Chivas Brothers is preparing for the worst-outcome Brexit, although bosses have said they do not know what the final result will be.
The company’s CEO Jean-Christophe Coutures spoke about the problems of planning for the unknown when he and Alexandre Ricard, CEO of parent company Pernod Ricard, welcomed journalists to their new Scottish headquarters in Glasgow’s Blythswood Square. Staff have been moved from their old HQ in Paisley as part of a transformation of its operations in central Scotland. This includes a £50 million, high-tech bottling plant in Dumbarton, due to become fully operational by next year.
James and John Chivas founded the company in the basement of their grocery and wine merchant’s shop in Aberdeen in 1801. Now, Chivas Brothers has grown to become known around the world and operates 14 distilleries, all in the Speyside area, apart from Scapa on Orkney.
When asked about the firm’s preparations for Brexit, Coutures turned the tables on his guests with a joke: “I could say that it’s very difficult to follow … could we rebuild the Q&A because we have some questions we want to ask you?
“As a business what we want is visibility. It is very difficult to forecast and to plan for the unknown.
“Now we are firmly preparing ourselves for a No-Deal Brexit with the expectation that there will be a deal, which has always been our position. But we need to prepare for the worst.”
The firm has stocked dry goods such as glass to ensure there are no production shortages. It has also filled its international distribution pipeline to minimise potential shortages due to disruption at ports.
“Yes, we are ready but … I don’t know what the outcome will be,” said Coutures. “We are all planning and ‘how big will the disruption be?’ will be the question.
“The only thing I know is we are ready and I am firmly of the view that Scotch, no matter what, will continue growing and I don’t expect any slowdown because of Brexit.”
Ricard said the company’s latest results indicated the best growth over the past eight years, most of which was driven by whisky.
He commented: “These results have driven operating profit growth of 8.7% almost 9% organically and with positive currency impacts 9.5%.
“Our Scotch business is driving that growth and we’re extremely happy about it.”
Coutures also stressed the importance of Scotland to the company’s business. “Every year in Scotland we are investing £500 million between distillation, manufacturing and logistics, which is a strong commitment to the growth of the business and what we think is the future of Pernod Ricard,” he said.
“I think we are really transforming our business in Scotland, transforming our working environment so we are now building two new headquarters – one in Glasgow which I love because it’s a historical building … I love the way it’s been designed because it is respecting the past and at the same time is very modern.”
Several of the firm’s distilleries – such as Glenlivet and Strathisla – have been modernised and the firm is keen to attract more tourists with improved visitor experiences.
“The Scottish Government is doing a lot to invest in hospitalities, to invest in internal facilities, transportation, to ensure that guests can be welcomed easily,” said Coutures.
“I think two out of three visitors to Speyside go to the distillery, so our objective is to contribute to that.”
Ricard added it was hard to predict if Brexit would deter visitors: “How will it work, what type of deal will it be, how difficult will it be? If there are issues at the border how long will it last? For us it’s impossible to have a view.”
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