Iconic Qld company riding out pandemic on the back of a mule
Riding high on the back of a mule, a Queensland family business has stubbornly stood its ground in the international market through the immense challenges of the coronavirus crisis.
"In America, it's a cocktail society and we are the number one pour for a Moscow Mule," says John McLean, chief executive of the company that makes Bundaberg's iconic ginger beer.
"People have been locked up and wanting to reward or treat themselves and their buying behaviour has changed to look towards affordable indulgence products.
"They're making Moscow Mules at home and they want to be able to have the best ginger beer in the world to mix with it."
Bundaberg Brewed Drinks, started by the Fleming family, bottled its first ginger beer back in 1960 and it also now produces a premium range of more than a dozen other non-alcoholic carbonated beverages.
Over the past decade, a strategic focus on its international business - as well as becoming a sought-after ingredient for the vodka-based Moscow Mule - has led to skyrocketing popularity and a massive upkick in global sales of its soft drinks.
At last count, a staggering 75 million bottles of its beverages were being sent overseas every year via the Port of Brisbane. That equates to an export rate of almost 2.5 bottles a second.
Offshore sales currently make up 47 per cent of Bundaberg Brewed Drinks' total market and McLean says that is on track to bump up to 51 per cent this year, outstripping domestic sales.
"That's a big celebration milestone for the company," he says.
But although the company has lost none of its export fizz, McLean admits COVID-19 has "thrown a lot of challenges at our business both domestically and internationally".
"We've seen significant shifts in buying patterns that we've had to respond to rapidly," he says.
"Globally, we have experienced unparalleled disruptions to our impulse sales - the on-premise trading at bars, restaurants, clubs, cafes, convenience stores and petrol stations, which have been shut down or are seeing limited traffic due to COVID-19.
"The demand, however, has shifted to grocery channels around the world and that has helped minimise the impact of COVID-19."
Of the more than 60 countries it exports its soft drinks to, the US is its biggest international market.
"It's that indulgence in Moscow Mules and mixology that is really driving those sales in the US," McLean says. "They seem to have an ability to mix everything with ginger beer. There's the Kentucky Mule, which is bourbon and ginger beer. The Mexican Mule, which is tequila and ginger beer. And the Irish Mule, which is Irish Whisky and ginger beer.."
McLean says Bundaberg Brewed Drinks' grocery sector has grown by more than 65 per cent overall in the last few weeks in the US. "In California - our strongest US market - its 89 per cent up. But just to put that in perspective, our sales in bars and cafes are 90 per cent down."
In the UK, the company's supermarket sales have grown by 61 per cent over the past month but the cash and carry sector that services bars/cafes and smaller independent stores declined by 70 per cent.
"Europe has been one of our challenging markets during the COVID-19 crisis because there is usually so much restaurant and cafe trade," McLean says.
In France, the grocery sector grew by 44 per cent in April but bar/cafe sales plunged by 96 per cent.
McLean says there are already strong indications of sharp regrowth in sales in China and South Korea.
"In February during full lockdown sales dropped but we are now seeing sales go back to the level we were growing at - in excess of 100 per cent year-on-year."
After initially pulling back production slightly to avoid too much product sitting around during the crisis, the company since has ramped its operations back up and hired 12 more workers.
"We have some strong growth aspirations for next financial year and that is across every region we deal in." McLean says.
Originally published as Iconic Qld ginger beer riding out pandemic on the back of a mule