The challenges facing European spirits companies

As one of the biggest spirits markets in the world, Europe boasts many leading cocktail cities and trends that continue to shape the sector, such as the movement towards lighter serves and apéritifs.

While being an attractive market for spirits producers, Europe has had its fair share of challenges in recent years – namely Brexit and trade wars. The UK’s choice to exit from the European Union after being a member for 47 years sent shockwaves through the industry, following the 2016 referendum. While a Brexit agreement was secured at the end of 2020, there remains a lack of clarity over its long‐term impact on the spirits sector. Meanwhile, the trade wars between the US and EU, the result of an aircraft dispute, has had a monumental impact on the industry. The US has been embroiled in a long‐running spat with the EU over civil aircraft subsidies. The ongoing Covid‐19 pandemic has also thrown another spanner in the works.

Emilio Restoy, CEO of Spain’s Zamora Company, called Brexit a “major disruption” for the spirits sector. “It doesn’t make it easier for anyone,” he says. “An agreement is much better than no deal. Last year there was huge uncertainty.” The Spanish firm exports Martin Miller’s gin to Europe and imports other liqueurs and spirits to the UK. Restoy notes there have been no major issues so far resulting from Brexit.

Since the agreement came into effect on 1 January 2021, firms in many industries have reported short‐term disruption, including French producer Famille Naud. Saffron Brice Rouger, UK sales manager at Famille Naud, says: “Even though we felt well prepared with all the work carried out beforehand with French customs, our exports to the UK, in the first few weeks of January, were not as straightforward as we had wished for. From this side of the Channel it feels like there maybe wasn’t enough communication from the British side on which formalities would have to be done to import after Brexit.” Rouger adds it was difficult to measure the impact of Brexit alone because of the coronavirus pandemic.

Nikulas Hannigan, global brand educator for non‐alcoholic ‘spirit’ brand Fluère, also cited the immediate impact of Brexit on importing into the UK. Hannigan says: “We are a Netherlands‐based company, and Brexit has been wreaking havoc on the ability of our UK importers to actually get Fluère into the country. It’s been sorted now so hopefully there are no more hiccups, but these are trying times all around.”

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