Looking Back, Forging Ahead Q&A: Ben Knollys, Hatch Mansfield

By Harpers Editorial

Published: 23 August, 2023

Midway through 2023, Harpers is taking stock of yet another turbulent year for the drinks trade, with plenty of highs and lows, so far. We continue our series with Ben Knollys, MD of Hatch Mansfield, to find out how the year as gone so far, and what the remainder may bring.

How has business been for you in the first half of 2023 and how do things compare to where you were last year?

We entered 2023 against a backdrop of numerous challenges for the wine trade: the continuing energy crisis, the on-going impacts of Brexit, extreme harvest conditions leading to supply difficulties, supply chain issues, increasing production and fuel costs as we continued to feel the reverberations of the devastating war in Ukraine, the impending duty rise uncertainty, cost of living crisis, the list goes on!

Some of these challenges were only nascent this time last year, when we were still adjusting to post lockdown ‘normality’, although it seems there is no such thing as ‘normal’ these days. Despite this testing environment, everyone in Hatch continues to work really hard to mitigate these challenges. Our strategy has remained unchanged: focusing on our customers and our suppliers; ensuring we offer the right wines at the right price; and prioritising great service while adding value to the supply chain.

How has the cost-of-living crisis played out across the year and what – if anything – have you been able to do to mitigate that?

The positioning of our portfolio has always been within the premium space, with RRPs starting at around £8. The UK average for a bottle of wine is currently just over £6.50 in the off-trade. However even in a cost-of-living crisis, quality still resonates with consumers and at Hatch, we always emphasise the provenance, quality and people behind the brands we represent.

The ‘drink less but better’ trend sees no sign of abating and is something we continue to champion as a business. Everyone has felt the pressures of the past few years and how we adapt to this uncertainty is to approach it with long-term optimism alongside resilience and pragmatism.

What are you most proud of achieving this year? Have you managed to achieve any specific goals?

Keeping a positive, can-do, team-focused attitude to the fore at Hatch, whatever the weather.

And what is the biggest cause for concern?

A big area of concern for us as a business, and the trade as a whole, is uncertainty surrounding duty. As we have seen with the recent duty increase in wine, consumers now face the largest single alcohol duty increase in almost half a century. Still wines being taxed at different levels depending on alcoholic strength adds a huge amount complexity and administration on top of the impact of the actual duty increases for us as a business, our suppliers, customers and consumers. We continue to support the WSTA in any way we can to lobby government to ensure that the temporary duty easement for wine becomes a permanent feature.

What are the biggest drinking trends at the moment and how do you expect that to change going into the autumn?

We know that consumers, especially younger consumers, are increasingly drinking in moderation, drinking ‘less but better’. In light of the punitive duty increases planned in early 2025 for different levels of alcohol in wine, there will be an increase into the market of lower alcohol wines as companies seek to mitigate against these increases and tap into the rising ‘low & no’ wine category.

Alternative formats, such a wine in can, is also a rising trend. We were very excited to launch our own range of premium organic wine in cans last year, Wild Steps. Not only are cans more lightweight than bottles, they are fully recyclable, highly portable and allow consumers to moderate their alcohol intake.

Is Covid now a distant dream, or are you still seeing lingering effects?

It is the multiple challenges and uncertainties of the last few years, not all pandemic-related – although many of them created or exacerbated by the pandemic – that have had a cumulative effect on the drinks and hospitality trades. Consumer behaviour and our customers’ and suppliers’ businesses have all been affected. Inflation, energy costs spiralling, the cost of living, the impact of duty increases and climate change pressures have all created uncertainty for everyone within the supply chain.

Any predictions for the second half of the year?

I am a great believer that predicting the future is a mug’s game – you only have to look at how woefully inaccurate just about every economic forecaster is, not to mention the fact that curve balls, or black swan events if you would rather, are by their nature unpredictable. However, (since you ask!) the consumer will continue to feel the pinch of inflation, the aforementioned duty increases will inevitably cause some changes in consumer habits and there seems to be a rapidly growing risk of a financial implosion in China, which could have contagious effects worldwide. But against such pressures, as we saw during Covid, consumers will continue to rely on well-established brands.

Quick fire questions…

Old World or New?

Both

Cocktail or slow sippin’ spirit?

Spirit

Vermentino or Vermouth?

Vermentino

Low or No?

Neither (although a crisp, 9% German Riesling…)

Three star or bistro?

Bistro (although Two star, Le Gavroche, one last time…)

Desert island tipple?