Beam Inc, makers of Teacher's and single malt Laphroaig scotch whiskys and a range of other liquor brands, is back in the Indian market since January, after it suspended sales of its products and also four top Indian staff following a whistleblower allegation of violations in excise duty payments, distribution and invoicing.
Illinois-based Beam, which also makes Sauza Tequila and Courvoisier cognac, has been conducting an internal audit under an anti-corruption law and suspended sales for two months from October 2012 end and went about reorganising its Indian team, which has been done. Overseas managers are taking a direct interest.
Arthur Aroney, Beam's managing director for emerging markets including India, said the October-December quarter saw significantly lower sales in India. "We expect the first three quarters this year to see lower sales till we ramp up," he added. "We have outperformed the whiskey market in India and don't expect demand for Teacher's being dented because of our investigations."
While Beam refused to divulge any figures, market sources said it could have lost a 6-10% scotch marketshare in India following the hiccup. But Beam was quick to refute reports of Teacher's losing the top rank in scotch sales in India, citing Nielsen's data that still placed Teacher's at the top.
Beam, which owns 10 of the world's top 100 premium spirit brands, is aggressive on India, even ahead of China, with its focus mainly on Teacher's. The compounded annual growth rate has been around 20% for five years now.
"Our strategy, in all markets, is to build from a core brand that leads in a market place, and then broaden it with other introductions," said Kevin George, Beam's chief marketing officer.