Carlsberg Britvic intends to take a “hands-off” approach to smaller brands within its newly expanded portfolio, its CEO has said.
Speaking at the first-ever Carlsberg Britvic soft drinks Review on Thursday (15 May), Paul Davies heaped praise on Britvic’s Breakthrough Brands division, responsible for scaling acquired and incubated brands including The London Essence Co, Plenish and Jimmy’s Iced coffee.
“As a Carlsberg person, I look with shock and excitement at the way the Britvic business is set up to manage small brands and get benefit from scale,” Davies said. “It’s quite a unique model, and to see the levels of growth of brands like Plenish and Jimmy’s, as well as exciting innovations like the Aqua Libra business, is great.”
While Carlsberg has successfully scaled smaller brands such as Brooklyn Brewery in the UK, other acquisitions like London Fields Brewery have failed to gain traction. London Fields Brewery was closed in late 2021, with its brewing kit being sold to Saint Monday in 2023.
Hence, rather than stamp its own approach on Britvic, Carlsberg would look to learn from the soft drinks business’ attitude towards challenger brands, Davies said.
“The Britvic business we have inherited has been very successful at nurturing small into a stronger future,” he said. “So we’re playing a bit of a hands-off role so as not to jeopardise that.”
Britvic’s experience developing smaller brands would help Carlsberg Britvic make a success of future alcoholic or soft drinks M&A, Davies added.
“I will be quite bullish and say that we will look at [acquiring] things in the future, and it gives us greater confidence,” he said.
Sugar tax impact
Elsewhere, Carlsberg Britvic refused to be drawn on whether its soft or dairy drinks could be reformulated if the government elects to expand the scope of The Soft Drinks Industry Levy.
“We will respond once we have a fully formed piece of legislation,” said Carlsberg Britvic category, RGM and insight director Tim Downes. “We have a strong track record of growing low and no sugar products, so in some respects we are much less exposed than a lot of other suppliers.
“The start point is we don’t want to compromise the experience for the end consumer. If you go back to the first time [the sugar levy came] around, there were some things we chose to reformulate and there were some things we chose to leave sugar in. And that would be the case again.
Read more: What do new sugar tax thresholds mean for drinks suppliers?
Pressed on the impact of dairy drinks such as Jimmy’s Iced Coffee coming under the scope of the levy, Downes added: “People love Jimmy’s for its taste. That is its key differentiator, and therefore we’d be wary of playing around, but ultimately we’ll be looking at it on a case-by-case basis.”
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