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No bounty from our gold medal rum: Fosters not interested [The Fiji Times, 10 June 2003

28/03/2012

  Fiji’s rum, if it had any spirit, must feel terribly neglected.  IsFiji’s quality rum a Cinderella, left in the kitchen by her  step-mother?

Fiji, like most small developing countries, faces great difficulty in manufacturing goods which are competitive in the world economy.

Goods which the world values; which the world would like to buy at the prices we can profitably sell; and goods which we can produce in quality and quantity.

And inFiji’s rum, we do have such a product.   It has won international gold medals before.  But its makers apparently do not enter our quality rum in every important competition, every year.

A rum situation indeed.

Minority shareholders in SPDL need to ask questions of South Pacific Distillery, its controlling company (Carlton Brewery Fiji Limited), and its ultimate major shareholders, Australian group Fosters International and Fijian Holdings Limited.  There may be valid reasons the public is not aware of.

But Government provides a protectedFiji market for this company with high duties and at great cost toFijiconsumers.

 

Government must encourage SPDL to become more competitive internationally, and to assist in Government’s export led strategy for economic growth and development.

 

International competitions

 

  How do wines, rums and other spirits establish their international reputation and markets with consumers?  Advertising and “word of mouth” amongst consumers play a major part.

 

But an extremely powerful marketing tool is winning awards at international wine and spirits competitions.

 

For and wine and spirits brands, a  gold medal (or even silver and bronze) won at an international competition can boost the market value of that brand, and that particular vintage or batch.

 

The company will proudly trumpet the medal won, in media advertisements, in liquor outlets, and on every bottle, boosting demand.

 

The price charged can double, triple, or achieve even higher values, depending on the international experts’ perception of its quality, vis a vis other brands, other vintages, and the appropriate marketing.

 

And SPDL’s Bounty Rum has beaten other well-established international rum brands.

 

Its Bounty Dark Rum won gold medals in 1983 and 1995, in the London International Wine and Spirits Competition.

 

In 1997, it won a gold medal in the Monde Selection inBrussels, organised by the International Institute for Quality Selection.

 

And in the same competition in 1999, the Bounty Millenium Black Label Rum was awarded the Grand Gold Medal.  In 2002, its White Rum won a silver medal.

 

The number of medals won by SPDL rum products seems to be limited only by the number of times it has entered.

 

And astonishingly, SPDL has not entered every year it could have and every important competition.  Why not?  Perhaps there are good reasons the public are not aware of.

 

Australian beneficiaries

 

  But, the paradox is that a private Australian company last year imported bulk Bounty Rum fromFiji, bottled it under its own brand name (Inner Circle), entered it in the International Wine and Spirits Competition inLondon, and won 20 percent of all the rum prizes, including 2 golds and 3 silvers.  It also won the Grand Trophy for the Best Rum in the competition.

 

This year,Fiji rum, under the same Australian brand, again won the gold medal at the Monde competition inBrussels.

 

So why does SPDL not enter its own rum in international competitions, under its own brand names, and win medals?

 

The cost of entering international competitions (a couple of thousand dollars per product) cannot be a factor is minor, given the potential benefits.

 

Is it Australian control?

 

  SPDL is ultimately controlled by Carlton Brewery Fiji Limited, and hence by Carlton United Brewery (and Fosters International) inAustralia.

 

Carlton Brewery Fiji Limited, upon acquiring SPDL, no doubt turned it around from the inefficient moribund company it was under FSC control, to the current tightly run company generating excellent profits, albeit under high duty protection.

 

But a subsidiary of the parent Australian company is The Continental Spirits Company, which imports intoAustralia, bottles and sells Jamaican rum under its own brands.

 

The Australian controlling company also has interests in other spirit brands which may be more profitable per bottle (and in aggregate) for Carlton United Brewery (Australia) than SPDL’s Bounty Rum.

 

But that only explains why the parent company may not wish to pushFiji rum in the Australian markets (or in NZ markets which CUBAustraliahas successfully penetrated).

 

Another factor may be thatFijirum (and other SPDL spirits) also compete with Australian rums, spirits and beers, around the Pacific markets.

 

And the Australian parent company may be of the view that aggressively marketingFiji rum internationally, may be less profitable for it in the long run, considering their regional and global interests in alcohol product sales, and considering that they only get a part of the profits from theFijioperations of SPDL.

 

While understandable from their profit point of view, the situation is very unfortunate for SPDL as aFijimanufacturer.

 

It is unfortunate for SPDL’s minority shareholders (both in SPDL itself and in Carlton Brewery Fiji Limited) who do not share the same financial interests as the Australian parent company.

 

And it is very unfortunate for employment and income generation inFiji,Fiji’s export earnings, andFiji’s attempts to establish international reputations for genuine quality products, fully manufactured inFiji.  Just as Fiji Water has done.

 

Great potential

 

  Without doubt, SPDL has ample scope to expand production of its unique quality rum products.

 

The quality ofFiji’s rum no doubt derives from the peculiarities of theFijimolasses used in the distillation process and that, ironically, may even depend on the bad cane harvesting practice of  burning cane before cutting.

 

The superior quality must also depend on the skills of our rum “brewers” and from the slower (but more costly) “pot still” method of distilling which preserves a bigger range of flavours, in contrast to the faster (more profitable), rougher “fractional distillation” method.

 

I am not a spirits drinker.  But the glorious range of flavours and aromas that some of SPDL’s aged “pot still” rum batches aroused from my taste buds, matched the delight of a great Cabernet Sauvignon.

 

While SPDL may not be a world beater in producing the other spirit products, it clearly has proven comparative advantage and international superiority in making quality rum.

 

And SPDL is nowhere close to exhausting the ample supply of molasses inputs that the FSC mills continue to churn out, because of their unfortunate inefficiency in producing sugar.

 

Going for gold

 

  In the run-up to the South Pacific Games, companies are deliriously advertising themselves, by encouraging TeamFijito go for gold.  One comically even uses the tumeric yellow colour of their shop exterior as a leading image.

 

Yet inFijirum, we have a product that has already won genuine gold medals internationally, has the grand potential to win more, and create genuine advertising opportunities internationally, regionally and locally.

 

Winning gold internationally would enable SPDL to increase its sales internationally (thereby earning more foreign exchange), develop economies of scale, enhance profitability, and even reduce prices locally.

 

But the company appears to be reticent at competing.

 

Is it time the minority SPDL shareholders and the Fiji Government pushed this company towards their gold medal prospects?

 

Is there a need to instill some genuine competitive South Pacific Games spirit into this distilledFiji spirit, forFiji’s sake?

 

 

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