Diageo talks

[Rob Allanson]

This from the Herald:

DRINKS giant Diageo emerged from a "positive" meeting recently with Finance Secretary John Swinney promising to examine detailed proposals on how their Kilmarnock and Glasgow plants might be saved.

But behind the warm words their pledge to come back with an answer "as soon as possible" was seen as an indication that they would be hard-pressed to drop their own plan to close these facilities in favour of an expansion of production in Fife.

After his meeting with David Gosnell, managing director of global supply and procurement, and Bryan Donaghey, managing director of Diageo Scotland, the Finance Secretary said: "The proposition is predicated on the continuation of business activity at Port Dundas and the establishment of a greenfield bottling plant in Kilmarnock. We have set out the details, which have been discussed at length, and Diageo have taken that proposal away for consideration. Further discussions will follow."

It is understood that the company might have walked away from yesterday's talks had the taskforce plan been flimsy.Mr Gosnell said: "It was a positive meeting and we can confirm that Diageo has now received details on the taskforce's alternative proposal. The next step is that we take this document away and examine it closely. On completion of that process, there will be further active dialogue."

[Danmag]

Don't hold your breath. Diageo will still be looking at the bottom line, so unless the Government proposals will give them the same figures as they have worked out with their own they will go ahead and close the two plants.

[kallaskander]

Hi there,

notwithstanding the jobs under threat, but...

Public money to a private company with a freh profit of 2 billion?

Are you crazy politicians?

Here in Germany it kept the companies from executing well laid closure plans for about 2 years then the jobs went. And the public money was privatised in the pockets of shareholders.

How desperate can you get?

What you have in mind for a short political gain is not sustainable.

And that is what you owe to the workers and their families. It does not help them any to postpone something that will cost their jobs one day anyway.

Greetings
kallaskander

[Danmag]

Well, it didn't even take them as long as I thought it would. My condolances to those who are about to loose their jobs but Diageo were never going to change their decision once it was announced.

[Anster]

Aye, there was never any doubt about what their response was going to be. You want industry standard whisky, you get industry standard ethics, it makes no odds to them whether it is gin, vodka, malt or single grain, distilling is distilling, it could just as easy be 'heavy water', if it sells they'll make it. There are plenty of others whisky firms, family run and independent, run by lovers of whisky for lovers of whisky. If you don't like Diageo's politics, don't give them your money.

[Novice Scotch Fan]

[quote="Anster"] . . . If you don't like Diageo's politics, don't give them your money.[/quote]

Easier said than done given the enormous portfolio of some of the finest whiskies owned by Diageo.

[laphroaig10_65]

[quote="Anster"] If you don't like Diageo's politics, don't give them your money.[/quote]

I agree. In fact I continue to drink DIAGEO's brands by indipendent bottlers. Three years ago I have bought my last DIAGEO's official bottle.

Luca

[Danmag]

The problem I forsee with the approach of not buying Diageo's official bottlings is that the indipendent bottlings are going to increasingly dry up. It really has got to the stage where they need the backing of a distillery, either they need to own one or they need to be owned by one as quite a few already are, or are trying to be.

[Anster]

[quote="Danmag"]The problem I forsee with the approach of not buying Diageo's official bottlings is that the indipendent bottlings are going to increasingly dry up.[/quote]

If they don't make expansive profit from a distillery Diageo close them or sell them, and while it would clearly be terrible for any of the current distilleries which have the misfortune to be owned by them to be adversely affected by consumers voting with their wallets, the simple fact remains that they are just as happy to deal in the stock from closed distilleries as that of open ones. It really makes no odds, sales are sales. In many ways the best thing that could happen would be that some of their under-loved distilleries came onto the market and let people who love whisky invest in them. Indies bottlers buy as good whisky as they can afford and can their hands on, and there is plenty of top grade stock out there, hence the variety of their releases in recent years.

There are also a few truly green shoots in the industry too with the recent successes of Bruichladdich, Edradour, Benromach, Bladnoch, Glengyle, Kilchoman and Draftmill to name but a few. The collectors' market is also expanding (at both ends of the price scale) so there really is no need to feel confined to the industry standardized offerings from Diageo and Pernod. Free your mind and your taste buds!

[Danmag]

Anster, what you have said just backs up my point. Of the list you gave four of them, Bruichladdich,Edradour,Benromach and Glengyle are either owned by, or owns, an independent bottler.Duncan Taylor are trying to build a distillery and I think the rest, if they want to stay in business, are going to have to get their hands on one, even if it means they merge with one of the smaller indipendent distillers such as J&G Grant.

[Anster]

[quote="Danmag"]what you have said just backs up my poin[/quote]
Not exactly, but I see what your getting at. Fear not though Danmag, they'll be plenty to bottle and plenty of people to bottle and sell it for a long time to come. Distilleries aren't going out of business at the moment, they are being shutdown, it's a very different thing.

[Danmag]

That's as may be, but I'm off to Dufftown for the festival, may see some of you there.