Exclusive: Moët Hennessy USA Re-Ups With Southern In Key States, But Sheds Doubt On Becoming 100% AlignedJanuary 20, 2016
Moët Hennessy USA has renewed its distribution agreements with Southern Wine & Spirits in the key states of California, Florida, Illinois, Nevada, Washington, Kentucky, Hawaii, Indiana, South Carolina, Oregon (for wine only) and Alaska, as well as 17 control markets. The deal continues Moët Hennessy’s strong relationship with Southern, which is “by far our largest wholesaler and represents well north of 50% of our U.S. business,” said Moët Hennessy North America president and CEO Jim Clerkin.
The accord comes in the wake of last week’s unveiling of Southern Glazer’s Wine and Spirits, a new national distribution alliance with a 41-state footprint. Moët Hennessy USA is partnered with Glazer’s in major states including Texas, Missouri and Louisiana, among others. Its portfolio is thus with Southern or Glazer’s in most major markets. Two key exceptions are New York and Washington, D.C., where its distributors are Empire Merchants (Charmer Sunbelt) and Breakthru Beverage (Charmer Sunbelt-Wirtz), respectively.
Nonetheless, Clerkin cautioned that the company has yet to decide on any arrangements beyond this new agreement with Southern. “These contracts are specifically with Southern,” he emphasized. “At this stage, we haven’t concluded any arrangements on the Glazer’s side, because (the merger agreement) has to reach its full conclusion. So the Glazer’s piece is a discussion for another day.”
Last week, Bacardi USA became the first major supplier to fully commit to the Southern Glazer’s vision. But Clerkin articulated a slightly different strategy from the Bacardi approach. “It’s unlikely that we’d want to be 100% dedicated, everywhere in the U.S.,” he said. “The most important thing for Moët Hennessy isn’t necessarily the distribution network. It’s about how we create desirability for our brands, regardless of which wholesaler we choose.”
Moët Hennessy’s flagship spirits brand Hennessy Cognac had a strong year in 2015, rising by 18% to crest the 3-million-case mark, according to Impact Databank. The company’s lead Champagne brands, Moët & Chandon and Veuve Clicquot, both have been in growth mode in recent years. In the 12 months through November 2015, Champagne Veuve Clicquot was up 8.7% to 441,000 cases, while Moët & Chandon rose 4.2% to 379,000 cases. Elsewhere in the portfolio, Belvedere vodka was up 5.5% to 495,000 cases.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.