Stuart Gregor on Four Pillars Gin and Lion

FOUR PILLARS GIN

LIFE AFTER LION

In what is the biggest Australian spirit deal since Diageo acquired Bundaberg Rum 20 years ago, Drinks Trade talks to founder of Four Pillars Gin, Stuart Gregor, about the future of the business after Lion bought a 50 per cent stake.

Drinks Trade: Why did Four Pillars choose Lion?

Stuart Gregor: We had some early chats with a few other people and it did mean a bit to us to stick local. I like the fact that the one guy on the board is based in Sydney rather than Paris or London or the US.

They (Lion) are pretty serious about building the spirits side of the business and I think they are going to be a serious player over the next few years. We are lucky to be the first one chosen.

Vanguard is staying with us and hopefully we will be able to grow with them. This will help our relationship with them. If all we wanted to do was push into the international markets then there might have been something to be said for one of the big straight spirit businesses but I think Lion will help us locally and in the hospitality space. They are a really well run and excellent business in a whole lot of areas. From HR, to systems, to the way they run their business, is as good as anyone globally in the drinks world. One of the things we really liked is we can become a great business by learning a lot from them on how to grow but also how to build craft. It’s the concept of craft with scale that they have done so well with Squires and Little Creatures – think big and act small is our mantra.

DT: How do you see Four Pillars growth now?

SG: Our target is half a million bottles for 2019. We would hope to double that in the next few years. We need to get a new still. In 2020 we will start to develop the property next door. With our capital expenditure budget it allows us to start to really plan properly what we are going to do there. We will be able to do more hospitality and more production. Within the next few years I would like to be double what we are now but it’s sustainable growth. That is one of the reasons Lion is good for us. They haven’t said to us, you need to be up 100,000 cases by the end of next year. They know with a craft business like ours we can’t just aimlessly chase growth wherever it happens to be. We are going to look for growth, proper sustainable growth, in Australian, both on and off. We are going to look at Travel Retail. Here is a big opportunity for us. Travel Retail drives 15 and 20 per cent in some other businesses but it is not even close to that in our business. We just got an order in Dubai. We are in Changi and Hong Kong and Bangkok airport now. It builds our reputation in the market as a serious global gin producer when people start seeing you in great airports around the world.

DT: Talk to us about innovation?

SG: We have to prove to people that we are still doing really interesting craft stuff. What I’m really into is the stuff we call ‘made from gin’ or what we do from the stuff we make from the biproduct of gin, whether that is the marmalade or the cheese or beer. I think we can do more in that space. And then it’s about what do we do now? What is the next Bloody Shiraz gin?

We will have a sexy new Spiced Negroni packaging coming out in the middle of the year. That product took us by surprise. It was a product we made for a bar group and frankly we knocked up the label in house. Now it’s our number four gin. It’s in the core range. We are going to give that a new label come June. It’s 100 years since Count Negroni walked into a bar and ordered a Negroni. So we are going to do some cool pre-batch Negroni’s. We are going to sell bottled Negroni in the middle of the year.

DT: How much did Lion pay for their 50 per cent stake?

SG: I can’t tell you that other than to say there has been a lot of speculation. It was a great offer and it’s more than just money. We are investing heaps of it back in. The founders and original investors have got a lot of their money back and were the happiest people in Australia on the day of the deal. People forget that we had to re-mortgage houses and banks wouldn’t give us any money. One of the banks who would not give us money for years are all over us now. (laughs)

We begged, borrowed and stole quite literally. It’s easy to say now, how well have they done, but there was a few hairy moments there and we were lucky our partners were right behind us. We really thought we had to give it a red-hot go and we went all in which is my style.

DT: Did Four Pillars consider selling off 100 per cent?

SG: The danger of selling the whole thing was us just knicking off. It was never discussed. We would never have done it. They (Lion) would have woken up saying, what do we do with this place? Stu’s in Bermuda playing golf? It’s the ideal way of doing it. We are only five years old. There is still a long way for us to go to establish ourselves where we want to be. It makes for fun times ahead.

DT: What is Stuart Gregor up to right now?

SG: We are doing our first Asian based cocktail competition and our first final is in Bangkok on Thursday so I am going up to judge that. One of the boys at the distillery who is an investor is getting married in Koh Samui this weekend. We have one dozen staff going. He has timed it beautifully.