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Heated competition among local brewers, distillers in rural areas
Julian Richardson, Business Observer reporter richardsonj@jamaicaobserver.com
Wednesday, July 23, 2008

A poster displaying Worthy Park Estate's 65 per cent white overproof rum, Rum Bar. The manufacturer's intention is to initially penetrate the rural market.

Wray & Nephew and Red Stripe products may have the lion's share the alcohololic beverage market in the corporate area, but other manufacturers are looking outside the Kingston Metropolitan Area to procure a sizeable piece of the lucrative industry.

Wray and Nephew produces the popular White Overproof and Appleton line of rums while the Diageo-owned Red Stripe produces the Red Stripe beer as well as many of its parent company's foreign brands such as Heinekin and Guiness. The two companies combine share over 90 per cent of the local liquor market.

However, away from the brand-loyal corporate area, other manufacturers have discovered 'drinkers' markets that are more receptive towards the less popular local brands, and have provided opportunities for penetration.

The principals of Worthy Park Estates Limited believe they have found a welcome home for their 65 per cent white overproof rum - Rum Bar - in rural Jamaica. The 300-odd years old Worthy Park Estates has long been in the production of cane, sugar and rum, but citing market saturation, left the rum business in the 1950s. In 2005, they re-emerged with their pot-still distilled Rum Bar product, with the intention to initially penetrate the rural market.

"We are targeting the grass roots of Jamaica," noted Gordon Clarke, a director at Worthy Park. "Alot of the white overproof rum is consumed in rural rum bars and hence the name that we have chosen for our product.... So we have started to try to penetrate the rural areas before the city."

In this Observer file photo, George McLeish, co-owner of KRB Lea Jamaica Rums Limited, displays bottles of the company's rum product, the Port Royal (formerly known as Trelawny Gold), at KRB's manufacturing plant on Constant Spring Road in Kingston.

Clarke was mum on the volumes of Rum Bar currently being distributed, but said that with the help of distributors Carribean Producers Limited, the brand is making tremendous strides. A prudent marketing strategy is being employed by both Worthy Park and Caribbean Producers to propell the brand's recognition on the market. For example, patrons at last week's Reggae Sumfest were given free 'shots' of the liquor.

"We were giving out free shots behind the bar at Sumfest and people loved it," said Devon Reid, marketing manager, Wines and Spirits, at Caribbean Producers.

Reid, who told the Business Observer that the brand has been doing very well on the North Coast, said that the indegenousness of the product is its catalyst.

"Its a rural brand so that helps; people feel as if they own it," said Reid, who added that the pot-stilled distillation of the product contributes to its "smoothness".

Another brand emerging in rural Jamaica is the Port Royal Rum line, formerly known as the Trelawny, produced by KRB Lea Jamaica Rums Limited. The manufacturers, who are seriously focused on the tourist market, investing some $20 million last year to create a niche for the product, have naturally found good reception along the heavily tourist-populated Jamaican northern coast. According to KRB Lea co-owner, Geoffrey Messado, a major reason for its success outside the corporate area is the fact that it retails at "20 per cent below the equivalent Wray & Nephew products".

"Our packaging is good and the product is a nice product," noted Messado. "But because of the established name of Wray and Nephew and Appleton, it is easier to make niches on the North Coast with the price rather than the corporate areas."

KRB, acquired by partners Peter Thomas, Howard Campbell, Messado and George McLeish from Michael Shim in September 2006, has been manufacturing rums since 1992.
While it remains a small operation in the Blaise Industrial complex on Constant Spring Road, the new partners had said that in five years they seek to acquire more than a tenth of the local rum market, which absorbs in excess of one million cases a year locally. KRB is housed in a 3,000 square-foot factory and up to last year was selling about 30,000 cases of rum annually.

Despite some minor success, Messado acknowledges that Wray and Nephew is still very dominant outside the corporate area as well, making Port Royal accounting for just a mere fraction of the market share.

"Our market share is very small, very small," said Messado. "Wray and Nephew is about a million cases; if you take what we are doing as a percentage of what they do, its miniscule."
However, KRB has been doing alot of initiatives and Messado projects that by the late 2009, the Port Royal Rum would have made significant increases in volume. He highlights the enlistment of wine distributors Betco Premiere last month as a major boost.

"They are now our exclusive distributor for Port Royal Rum, so we expect to get better coverage," said Messado.
Initially penetrating the market with the Trelawny line of rums, including the popular Trelawny Gold, KRB was forced to change the name due to a dispute with Diageo.

"We had to change the name because the Diageo people thought that we were too close to Gold Label Trelawny Rum so we changed the name to Port Royal," said Messado.

The proliferation of hotels on the North Coast has opened up opportunities for manufacturers like Big City Brewing Company Limited to meet tourist demand for 'Jamaican' beer. Unknown to many Kingstonians, is the fact that Big City Brewing produces one of the most popular beers in the hotel sector - Real Rock. Big City supplies hotels with both bottled and draught beer, but it is the latter which makes up the overwhelming majority of the produce.

"Real Rock is consumed by tourists visiting Jamaica primarily in the hotels along the North coast," said Wendy Robertson, Big City's marketing manager. "This market demands quallity and variety, and are not as brand loyal as the typical Jamaican Beer drinker."

Added Robertson: "The growing number of hotel rooms on the North Coast augers well for our bottled and draught beer business."

Another Big City product, the Yardy Shandy is sold into retail outlets island wide. Though it also does well in the tourist market, its successes is not just limited to that market.
According to Robertson, alot of interest for Shandy has been generated in export markets such as North America and Europe.

Despite the emergence of other manufacturers, Wray & Nephew themselves has also seen the potential of the liquor market outside of Kingston, and has products distributed primarily in the tourist market. Two such products are the Coco-Mania Jamaican Cocunut Rum and the Coruba Jamaica Rum, both primarily supplied to hotels for consumption in cocktail and well form.

"Most foreigners, when they come to Jamaica, want to have a cocktail experience and these brands are very much popular in making cocktails," said Andrew Pryce, Wray & Nephew Marketing executive. "What we want to do is, when visitors come to Jamaica, at every point we want to interface them with Appleton brands."

Coruba is primarily known as a New Zealand brand of rum, but it is distilled and imported from Jamaica. Wray and Nephew's commercial distribution of the product locally is mainly to hotels.

Pryce noted that the emergence of players in the liquor market outside the corpoarte area is primarily due to the successes of his company's line of liquor. The executive is confident that Wray & Nephew will hold the firm grip it currently enjoys.

"When they look and see the success Appleton has in these markets, there will always be players entering these markets but we use good service and quality to keep them at bay," said Pryce.


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