THE INTERVIEW - NEIL MATHIESON

Published: 23 July, 2008

Neil Mathieson, Managing director, Eaux de Vie Ltd, London. Interview: Josie Butchart

Eaux de Vie Ltd 3 Harcourt Street London W1H 4EY

Tel: 020 7724 5009

info@eauxdevie.co.uk

Neil Mathieson trained as a chef before spending two years working in the drinks trade for various companies, including Bass Charrington. He set up Eaux de Vie 19 years ago, initially concentrating on selling Armagnac, and adding Cognac and Calvados a year later. Now the list is split between Armagnac (25%), other French brandies (25%), whiskies (25%) and liqueurs, Ports and Sherries.

What was the original idea behind Eaux de Vie?

We started out just importing French brandies, but in the past 20 years we have added rums, Sherries, Ports and other spirits - whenever and wherever we find products that are interesting enough and that have the level of authenticity that we like. Unfortunately we find the market afterwards, and that's not the best way of doing it! One of the faults of this company is that we don't worry as much about the final customer as we do about the quality of the product, and we do take on products that are practically unsaleable. We have about 12 French marcs on the list at the moment, and at least 20 grappas. Those are not the most popular or fastest-selling lines! We also have five different pastis and six mistelles, and that's on top of having too much Cognac, Armagnac and Calvados.

Why did you decide to concentrate on French brandies initially?

I had been putting together lists for various retailers and trying to find good Armagnacs by sitting down with all the lists from all the merchants and looking for products that I thought would attract attention on the shelves. But I just couldn't find what I wanted, so I decided to go out there and look for it myself.

What were the main difficulties you faced when setting up the business? I didn't know anyone and nobody knew me - either on the supply side or the selling side. So I had to learn everything very speedily and spend quite a lot of time driving around France, knocking on doors. The friends that I did start out with were very good to me and introduced me to lots of other people.

How did the Armagnac producers react to your new enterprise?

They thought it was very strange that someone so young was wandering around trying to buy Armagnac, especially as I didn't just head straight to the co-operatives but instead went to the individual domaines and also had an idea of what I wanted to buy rather than just accepting what they wanted to sell.

Who are your customers?

We only sell to resellers - retailers or wholesalers who sell into the on-premise trade - and we will supply just about anything to just about anybody, from multiples down to a single corner-shop. But we only have a few direct on-premise accounts, most of which are historical, from when we needed them to stay alive. We have no corporate business or private business, and we don't accept cash.

Which product moves fastest?

The biggest seller of all is crme de cassis, because we have an excellent producer (Grard of Maison Edmond Briottet in Dijon). We are constantly told that our crme de cassis is too expensive, but all our customers continue to buy it. There's a real demand for crme de cassis and, when they compare our product with others, they like the level of fruit it has.

Which category is showing most growth?

We are most excited about Sherry, and people now actually seem able to accept that, when it is good, Sherry doesn't have to cost under a fiver. We have a range of Sherries that go back into the trade at around 20 a half. We don't sell a great deal of them, but we do sell them, and in some cases we sell all the producer will give us. We went into the Sherry trade with our eyes fairly wide open. Sherry is massively underpriced, but we don't deal in that end of the market, where it is all about volume versus price. There are too many people who are very good at that and who have long-existing contracts in place with people who are interested in making that kind of product.

Are your sales bucking any other trends?

It's very difficult for a company as small as us to fit into the statistics. I know that the dark rum market is diminishing, but we have just sold the last batch of dark rum we had. I know that the bourbon market is increasing, but predominantly because the specialist end of the bourbon market is so small. If Jack Daniel's has year-on-year growth then the bourbon category has year-on-year growth. Our bourbons are doing really well and we are really excited about our bourbon, especially because Evan Williams and Elijah Craig win medals year-on-year, so it's not just us telling people they are good. It's very nice to be associated with products like that.

What's the secret of your success?

We are the only company like this in the UK. But that is more to do with the fact that if I were to go my bank manager this year and say, I'm going to start a company that sells half a million pounds worth of duty-paid goods, outside the ex-works business, and we would need half a million pounds in stock to do that, with the normal returns you get in the food industry', what do you think he'd say to me? He'd tell me to go away and think again. At any one time we have more than a quarter of a million pounds of vintage Armagnac sitting in our cellars, waiting to be sold. It is not good. You wouldn't pick it as a business. But after 20 years we are still here, so we must be doing something right!

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