The Business section in today’s Sunday Herald has majored on the all but absolute lack of growth in production volumes in the Scotch whisky industry – a total of 2.6% in 30 years from 1978 to 2008.
In ‘Cheers for nothing. The whisky industry’s complacency has cost us 52,000 jobs‘, it contrasts this growth with the 3.5% per annum growth of vodka over the last 20 years, a rate of increase around 43 times faster than that of Scotch. Rightly it points out that for the drinks industry, Scotch is a craft product, slow to mature where vodka can be on sale within a week of its distilling.
It mentions the Scotch Whisky Association.
It bemoans that much production of Scotch is not controllled from Scotland but from London; and that much is also ontrollled from elsewhere. It references the brands that fell into the hands of Paris-based Pernod Ricard (Glenlivet, Chivas Regal, Ballantine’s).
A parallel article by Business Editor Colin Donald – “Former whisky trade insider attacks industry’s ‘complacency’ ” (based on the same analyses by industry expert Donald Blair), draws attention to the Scotch Whisky Association’s continuing opposition to minimum pricing of alcohol.
This notes that minimum pricing per unit of alcohol will have no impact on the top Scotch brands because they are already priced far above the price per unit that the proposed legislation would impose.
We have been saying exactly this since the announcement of this necessary measure on which Scotland is leading. Why has it taken The Sunday Herald so long to wake up?
This piece by Colin Donald shows Donald Blair asking: ‘Why does minimum pricing interest the SWA so much?’
The piece goes on, cravenly, to use Donald Blair’s own oblique pointing to the drift of this question, rather than address it directly itself.
It quotes Mr Blair moving on from his question by saying: ‘Since when did the SWA worry about the cheap supermarket own brands which true marketeers believe devalue the whole Scotch category and are the bane of brand owners? Do the controllers of the SWA also have significant vodka interests – especially alcopops, the entry route of many consumers into white spirits?’
Curiously, shamefully, neither Donald Blair nor Colin Donald mention the name of the elephant in the room. Diageo.
For Argyll has been providing analysis and insights unpublished and unspoken elsewhere. We have had industry analysis from an insider Scotch whisky distiller who is deeply concerned about the direction and control of the industry, Mark Reynier from the notably innovative, successful and independent Bruichladdich distillery on Islay.
We have, from the outset, named the elephant.
These anxious hints – quoted above, that are all Donald Blair, Colin Donald and The Sunday Herald feel free to publish. The granting or withdrawal of advertising and for writers, access to sources for stories, are potent instruments of Diageo’s control of the media.
The truth hinted at in the final quotation from Donald Blair in the Sunday Herald’s second piece – repeated above – is that Diageo control the SWA and, to all intents and purposes the Scotch whisky industry.
The Chair of the SWA is Paul Walsh, who is Diageo’s CEO.
Diageo singlehandedly owns 40% of the the production of Scotch whisky. Pernod Ricard, which The Sunday Herald writers were brave enough to name, is a big player in the industry but owns about half the production volumes of Diageo.
Diageo also has massive interests in the vodka and alcopops market – the main intake by binge drinkers and serious revenue generators for this, the worlds biggest drinks company.
The major cut-price promotions it runs for such products are rightly targeted by the minimum pricing strategy. This is why Diageo is opposed to this legislation. This is why the ‘SWA’ (aka Diageo) continues other interests of its controlling distiller.
The legislation is aimed at reducing the social ills that see, UK-wide, one alcohol-related casualty appear at an A&E department every 40 seconds; and which place a burden of £900 per annum on every Scottish adult.
For anyone who really wants to know about the role, power and strategies of Diageo – a wealth-and-patronage driven lobbying organisation of awesome power (why else is the Sunday Herald loath to mention the one name most germane to the situation it examines?) – here is a selection of articles we have carried. Many more may be found by entering ‘Diageo’ in the search box in at the top right of this page, below the banner.
- Diageo: the real issue is the Scotch Whisky industry
- Diageo story plant in Daily Mail backfires: was the Kilmarnock closure a failed blackmail attempt to protect vodka profits?
- Diageo branded socially irresponsible for UK tax avoidance
- Banks and business, RBS and Diageo: the empire strikes back
- More curve balls from the Scotch whisky industry
- Public health experts back minimum pricing as Diageo fights on and recruits new drinkers