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Interview: Wayne Chaplin, CEO, Southern Glazer’s Wine & Spirits

March 21, 2023

With revenues projected to surpass $25 billion this year, Southern Glazer’s Wine & Spirits is expected to take a roughly one-third market share of the spirits and wine wholesale tier in the U.S. in 2023. Because of its enormous scale and reach—covering 44 states and Washington, D.C.—the distributor is a bellwether for the drinks industry as a whole. Shanken News Daily executive editor Daniel Marsteller spoke with Southern Glazer’s CEO Wayne Chaplin to get an update on where the company—and the market—is headed in 2023.

SND: What are you seeing out in the market on both the wine and spirits sides?

Chaplin: We’re still projecting some nice overall growth. A lot of it is being driven by the premium and super-premium segment in spirits. In the on-premise, we’re seeing growth over the prior year. Wine is a bit more challenged with volume at the lower end. But we’re still seeing some nice growth at the higher tier of the market above $15 in the wine business. And we continue to be super bullish about the future of the wine business, especially at the premium end. We’re focusing on execution at retail to give all our brands a better chance to grow in a tough market.

SND: Supply chain issues have been a key topic over the past couple years. How is that situation evolving?

Chaplin: The supply chain issue is much better than it was previously, with the availability of imports much improved. I think those issues and the constrained inventory for super-premium products are now behind us. And it’s a critical component to being able to build brands to their full potential and get the growth that we need. As a company we’re really focused on getting back out into the stores, getting back out into the on-premise, executing against drink menus and wine lists. That’s where we see the ability for us to advantage our portfolio over the competition.

SND: The SG Proof e-commerce platform came out big with $3 billion in sales last year. Are you seeing further progress there this year?

Chaplin: We were fortunate to have Proof roll out before the pandemic, which really drove the adoption rate. It has allowed our customers to be more aware of trends, opportunities, and new products to build their individual businesses. And it’s allowed our sales people to be more consultative with customers and has streamlined the transactional part of the relationship.

SND: Earlier this year, SGWS announced a new investment to bolster the on-premise national accounts team. What’s the agenda on that front?

Chaplin: We’re focused on increased education for our sales team. We feel that the knowledge they have about their products and information they can provide to their customers benefits not only the customer but all the way down to the end consumer. We want to really be that conduit of information and product knowledge to help individual on- and off-premise operators build their businesses. Now we’re looking to take our national accounts team to the next level. We’re fortunate enough to have a footprint that’s covering a majority of the national accounts across the country, and we felt that we hadn’t invested enough behind that important part of the business, which can be as much as 50% of the total business on- and off-premise. We brought in Chris Williams (a 20-year veteran of Anheuser-Busch InBev) to reorganize the on-premise, and part of the investment is an increased data package to make sure our people are the best equipped in the industry. We’ll also be announcing the next phase of what our off-premise national accounts team will look like later in the first half.

SND: How do you view Southern Glazer’s progress in the CBD category?

Chaplin: We were able last year to accomplish the goals that we set out as far as revenue and performance for our CBD suppliers. It’s been a little bit more difficult than first contemplated because the government hasn’t really been super clear about what the regulations are. But we’re going to continue in 2023 to stay focused on CBD and see what that opportunity looks like. We see there’s a lot of growth once retailers embrace the concept and put it in front of the consumer. We’ve got a small but passionate, dedicated team focused on CBD to lay down those roots for us for the future.

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