Life in the Fast Lane

Halewood International is a company built on innovation – finding niches and moving fast. But alongside being first to market, founder John Halewood says that success is fundamentally about salesmanship. Charlotte Hey

The life of John Halewood, majority share-holder and chairman of Halewood International, seems epitomised by firsts: first into the market with PPS’s, first to create a sparkling perry, first to brand Montilla and my guess is he’s the first man in the drinks industry to own a Grand National winner.

“I didn’t set out to get into drinks,” Halewood admits. “I started off in design, working at a design company in Liverpool. From there I went to work in a bank in London. God, that was boring. I had fun, although I didn’t enjoy it much. So there I was, looking for a job again, and I saw this advert for a wine and spirit rep. The most important thing was the job came with a car.”

You only have to be with John Halewood for a few minutes to realise he is a modest man and very down-to-earth. He perhaps does not seem at first meeting someone who is quoted on The Rich List as having a personal wealth of £65 million – and that was last year.

Most striking, however, is his slight nervousness. It’s an inherent impatience – darting from subject to subject, standing up to grab photos of him with Cilla Black, letters from Tony Blair. He’s proud of his achievements, but he’s not boastful. Names of the rich and famous are dropped into the conversation with a genuineness that is disarming and immediately likeable.

“Anyway,” he returns to the original subject of how he ended up in the drinks trade, “I went for the interview. It was snowing; I had to push the car out of a few snow drifts in order to get there, and in the end I was the only person to turn up. I don’t think I would have got the job otherwise.”

He chuckles, “Oh the training was intensive,” said with a hint of irony. “I was given six bottles of Sherry, the car keys, a price list in hand and a map of Yorkshire.” The rest, as they say, is history. “I was Hall & Bramley’s agent in the northeast, and at that time very fortunate. The new multiples were just beginning to open in the north, and so it made it easy to evolve and open new accounts with companies like Asda, Morrisons and William Jackson. Yorkshire, Derbyshire and the northeast was a good area at that time with great potential – it was fantastic challenge.”

This kind of statement is typical of John Halewood, who regards himself to have been lucky in the opportunities life has given him. He talks openly and directly about his achievements. His aptitude for good business is obvious, and the size and spread of Halewood International is testament to his ability to make the right decisions.

Experience at Hall & Bramley and Gonzalez Byass gave Halewood the opportunity to learn what he calls the “ins and outs” of the wine business and spot a few gaps in the market. His first brand was Club Royale, a Montilla-based product that hit directly at the Sherry category but undercut on price. So in 1978, he decided to go it alone.

“I am quite a restless person; I like a challenge and I like to innovate. I suppose it must be my design background. I love labels, presentation, packaging. I spent a lot of time on the presentation of my first brand Club Royale.”

He continues, “It was important to get the product right, and presentation is key. We started with small quantities at first, but it grew – it was the right style of product and a little ahead of its time. Club Royale was lower strength and therefore cheaper – it represented value for money.”

But was there anything else behind the success of the brand? “We succeeded by going to smaller accounts at first and doing in-store tastings. One of our first sales drivers was to give away a free tasting for every four-case order. No one had thought of that before,” he says. “We found that our clients, the wholesalers, soon started to stock it because the product created consumer demand. It being a Montilla rather than a Sherry was quite innovative.” Club Royale is still a 100,000-case brand, 27 years on.

The next product Halewood launched was Royal Dutch Advocaat, again containing less alcohol but this time directly imitating the brand leader. And again, the lower alcoholic strength made it cheaper. “They are what they now call ‘me-too’ brands,” smiles Halewood. Another first perhaps?

The success of these two brands and the fact that they were now beginning to expand into making British Sherry for own-label business meant the company was growing rapidly. But they had no production facility, so they started to look for a plant large enough to allow for further expansion. The discovery of the plant at Huyton represented the best deal in 1994, plus it had the benefit of combining three production units into one.

The founding of the plant coincided with the the launch of Lambrini, and Halewood soon realised that he had a serious hit on his hands.

“We were the first to do a sparkling perry, and it really caught the imagination of the buyers and the consumer.”

Halewood International produced 50 million bottles of Lambrini in 2004, and while the perry category has now plateaued in terms of growth in the off-trade, 12 years on, Lambrini controls the market, possessing 62% of the sector’s off-trade total – and five times the value of it’s nearest competitor (ACNielsen May 2005). Enviably, its value is equivalent to its volume in the multiples. Not many drinks brands can boast that statistic. How have they managed it?

“The whole point is that Lambrini is a fun brand. However, throughout it’s history we have been determined to hold the retail price. We have just launched Cherry Lambrini and we have the diet version. Lambrini’s success is due to the fact we have concentrated on the core brand since it’s creation – we’ve never diluted the message,” says Halewood.

Halewood is very definite about how to run a business successfully, and there’s no doubt in his mind about the importance of sales.

“Our emphasis has always been on sales. Unless you can get out and sell it you might as well forget it. Yes, marketing is important, and we’ve done quite a few marketing campaigns, but I do believe that distribution driven by sales is the most important thing. There’s no real point in having a marketing campaign if you are not sure of the distribution you have behind the brand.”

Having said that, Halewood is quick to admit the company’s biggest successes “have been with the products we have been first to market with. We were first in the PPS market 12 years ago with Barbados Blue and Carribean Twist, and first with Hochberg – the first sparkling example, and a 400,000-case brand in its hey-day. We were the first with Lambrini. And I think we were the first to really push spirits at 30% by volume. We’ve done a lot of innovation, and really our business is to offer good-value brands.”

Halewood is particularly proud of his investment and achievement with wines from Eastern Europe. “No one had heard of Bulgarian wine in the UK; it didn’t exist as a category in the multiples when we started.”

He reveals, “I have to say I have never been one for hitting the big categories; we’ve always looked for niche markets.”

But does Halewood believe that the market is harder today than it was when he first started? “Yes, today there are more brands around, more competitors, but there are many more fashion-conscious consumers. But looking back I have to say it has never really been easy getting a product on the shelf. And I don’t see the current state of the market improving, which is why I believe we have to keep innovating.”

And is that the secret to his success? “Yes, that is very important; you have to maintain a sustained interest in the company; you have to always keep the buzz of developing something new.

“You have to keep the family principle alive within a company, and unless you have the ability to sell you are not going to succeed. You have to be able to move quickly and react quickly to an idea.” db