Getting his kicks from life

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Related tags: Global brands, Beer, Alcopop

Never one to be in the passenger seat, Global Brands MD Steve Perez tells Noli Dinkovski how his single-minded approach to business drives him...

Never one to be in the passenger seat, Global Brands MD Steve Perez tells Noli Dinkovski how his single-minded approach to business drives him forward

All reports of Steve Perez suggested a dynamic, go-getting, entrepreneurial spirit living life in the fast line. So upon arrival at our meeting, imagine my surprise to find the man behind ready-to-drink (RTD) phenomenon Vodka Kick (VK) shuffling around in a stifling neck-brace.

A quick explanation from the 51-year-old Global Brands MD, however, and I'm quickly put right. "I crashed my rally car at 80mph while racing in Africa," he says. "I was hurtling over sand, a hole appeared and I couldn't slow down in time."

Dramatic enough you might think, but the story gets worse. "Because there was no one around, I had to keep driving for two hours before I could get any medical attention," adds Perez. "Eventually I was airlifted to Nairobi hospital, where I was told my neck was broken."

It turns out Perez was lucky — while in the hospital it was also revealed that had his injury been a few millimetres closer to his spine he would now be quadriplegic.

Although clearly a dramatic set of events for anyone to experience, Perez tells the story in a way that suggests he takes most things in his stride. And it's fair to say he's encountered more than his fair share of adversity on the way to turning Global Brands from nothing into the UK's number-one independent drinks distributor in little more than a decade.

Led by Perez, the firm, which enjoys a £72m turnover, continues to expand into new markets and broaden its portfolio of imported beers and spirits, and it's a journey that he clearly continues to relish.

Despite the exotic name, the softly-spoken Perez was, in fact, born and raised in humdrum Chesterfield — the town where Global Brands is based. He lost his Spanish-born father at 19 and was left to fend for himself when the family restaurant business was sold. After a stint as a technical manager at what was Allied Breweries, Perez decided he couldn't hack the politics involved in a multinational corporation so went it alone.

In 1986 he set up Global Beer Company and started importing never-before-seen lagers like Grolsch and Budweiser into the UK. Clearly years ahead of his time, Perez steadily built the business up until 1993 when the relaxation of laws on cross-boarder shopping changed everything.

"When the laws changed and brewers jumped onto the bandwagon of importing beers, it became more difficult for us as a small business to compete," says Perez. "I ended up going bust in 1996. I lost my car, but managed to hang onto my house by the skin of my teeth."

A bowed but unbroken Perez decided to set up Global Brands in 1997, mindful of the lessons learned from the failure of his first business. "I realised I needed to own some brands, otherwise anything we made successful could be taken away by the brand owners and given to bigger players, such as the breweries, to look after."

Perez turned his attention to the RTD market and couldn't understand why the average bottle of Hooch or Bacardi Breezer cost more than a pint of beer. "I looked into it and realised it was actually cheaper to make RTDs than lager," he says. That's when VK was born.

Growth in the early days was very limited, as banks weren't keen to fund a new business concept on the back of a previously-failed company. Credit terms to customers had to be kept short and VK was delivered directly to outlets rather than through wholesalers.

"Mark James, my sales director who owns 10% of the business, and I started off in a tiny warehouse and we would sometimes drive the van ourselves," says Perez.

"It was good fun setting up a new business. Scary, but exciting."

Perez says things "really started happening" when a leading nightclub chain reported more VK had been sold across a week than Budweiser. What's more, it was discovered that a drink originally targeted at women was being drunk by men as well.

It all took off between 2000 and 2003, when company turnover boomed from £2.2m to £66m. In this time Perez won a slew of entrepreneurial awards while Global Brands ranked third in The Sunday Times Fast Track 100 for businesses.

Clearly, with the market for RTDs in decline, the growth trajectory hasn't been as successful for the com-pany in recent years. Perez, however, remains upbeat. "To paraphrase Mark Twain — reports of the death of RTDs have been grossly exaggerated," he says. "People talk about the RTD market as something new, forgetting it's been around for almost 20 years. It's a mature market."

According to Perez, VK even experienced a 4% growth in sales last year, which given the state of the market was some achievement. "I think it has something to do with our diversity of flavours. We currently have six and their popularity changes all the time. For instance, VK Blue has always been our top seller, but lately there's been a switch to Orange."

Perez believes the RTD market took a hammering from Magners two summers ago, and attributes last year's growth to taking some of that share back. "Consumers don't just keep drinking the same thing forever — they are constantly changing their drinking habits," he says.

The "steady sales pattern" VK has enjoyed in recent years has allowed Global Brands to turn its attention to growing a portfolio of spirits, including Polish vodka Sobieski and Danzka, a Danish variety. Meanwhile, imported beers Viru, Salitos and Carib have also joined the fray.

In late 2006 the company set up a beer division, headed by world-lager expert and former Budweiser Budvar chief executive John Harley. "John's role is to negotiate with the brand owners and source new beers," says Perez. "His experience and judgement are invaluable."

Tsingtao, from China, was the first beer taken on in 2006, but it has recently been dropped following quality concerns and grey-market stock problems. Perez, however, says the other beers have no such issues.

"Salitos is a Mexican-style beer that is proving a hit in town-centre circuit bars, while Estonian beer Viru is very stylish and we are making serious in-roads with it. Carib is faring quite well, but will always be a niche brand."

Global Brands also recently took on two spirits from Diageo GB — cinnamon schnapps Goldschläger and Myers's Jamaican dark rum. "With Diageo being so huge, it's hard for them to focus on all their brands, whereas we are better placed," says Perez. "We are also speaking to

other spirit companies about taking on a small number of unloved brands that need re-invigorating."

Determined to add to his ever-growing armoury of brands, is Perez tempted to court outside investment help to grow the company further? "I'm not looking for investment or a sale. To be honest, I'm not really good at being answerable to other people," he responds.

"Although we are a £70m firm

that sells three million bottles of

VK each week, we still operate

like a small business. This allows us to make quick decisions, rather

than having to do everything through board meetings."

Perez doesn't claim to be a serial entrepreneur — he doesn't one day plan to buy Diageo. "I like being independent and staying true to my roots, that's why I'm opening a hotel, bar and restaurant complex in Chesterfield," he says.

Scheduled to open next year, the project will be an opportunity for Perez to show he's a "local boy done good". Food for the restaurant will be sourced locally — it is hoped much of it will be from Perez's own 200-acre farm, where organic rare-breed Highland and Galloway beef is currently being produced.

With all this talk of country farms and giving something back to his hometown, does this mean Perez is ready for a slower pace of life?

"No chance," he says. "As soon as I'm out of this neck-brace I'll be back in the driving seat of a rally car."

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