ASC owns The Scotch Malt Whisky Society (SMWS), which calls itself the “leading curator and provider of premium single cask Scotch malt whisky for sale primarily online to a discerning global membership” – and which saw about 70 per cent of its 2020 sales coming from outside the UK.
SMWS is based at The Vaults in Leith and brings curated whiskies to life through tasting events, content and other member activities. It was established in 1983 and currently has a growing worldwide membership of 28,000 paying subscribers across at least 30 countries.
ASC last month floated on London’s junior market Aim with a valuation of £78 million, saying this would help it to develop its membership base, enhance its digital channels, grow internationally and bring new brands to market.
Mr Ridley at the time said: “The successful fundraise and move onto the public markets, which gave our loyal and discerning members the opportunity to become shareholders, is an exciting landmark for both ASC and SMWS.
“ASC is a distinctive, fast growth, direct-to-consumer online business with high barriers to entry, operating in an industry with strong tailwinds."
The initial public offering (IPO) came after ASC secured a £19.5m funding package to support its growth after a record year.
The Australian boss of ASC has previously held senior general management and business development roles globally, including at Moët Hennessy, where he was managing director of MH Vietnam for three years, and business development director for Asia Pacific, Africa, Middle East and the Americas for five years with Glenmorangie/Ardbeg single malt Scotch whisky, where he also worked in global travel retail.
Additionally, Mr Ridley is a liveryman of the Worshipful Company of Distillers.
ASC recently made its stock market debut, raising £26m, and saying the firm was at a “significant inflection point in its development”. Can you give more details on the decision to float and how it will help achieve growth ambitions such as international expansion?
We’ve had a long-term growth plan. After leaving LVMH Glenmorangie we set out to develop a vast collection of single malt Scotch whiskies, developing our international route to market and building on our membership proposition.
We’ve achieved the goals we set out with in this first phase, and the float allows us to move onto the second phase, fulfilling our growth ambitions through continuing to grow our whisky stocks and, in particular, driving further member recruitment both in the UK and overseas.
The IPO also saw BGF complete a £7m cornerstone investment in ASC – how pivotal was this capital and guidance?
BGF has been very supportive from the beginning. We’re very grateful for all our investors big or small – both those that took part in the IPO and those that have joined us on our journey subsequently – and we are determined to repay the faith they have put in us.
ASC recently cheered the suspension of the US’ 25 per cent tariff on Scotch whisky imports for five years, deeming it an “important, positive” development for the industry. Can you give more details on this and the benefit to ASC itself?
We cheered the suspension of the tariff as it gives us and others in the industry long-term visibility over the US market and consistency that means we can plan with more certainty. When the tariff was first introduced, we decided to absorb the cost ourselves, so the suspension will help our profitability moving forwards.
However, you have also highlighted the challenges posed to the business by the coronavirus pandemic. What was the biggest stumbling block and how have you adapted? For example last year, more than 85 per cent of your group revenue was generated online...
The biggest challenge has been adapting to the restrictions related to Covid. Fortunately, we’re primarily an online business and we like many others have seen a trend of consumers moving in that direction for some time – the pandemic obviously accelerated that and that’s reflected in the continued growth of our online sales.
The SMWS is much more than a place to buy unique whiskies, though. Reaching out to and engaging with our members when we couldn’t meet them in person has been a priority throughout the past 15 months or so.
We’ve done more virtual tastings that can be done from home, and closer to the venues, and we’ve introduced home dining experiences that have been well-received. We’ll continue to provide our members with a variety of experiences they can enjoy remotely, but at the same time we’re looking forward to doing more face to face as things start to ease.
Can you give more details on ambitions for the SMWS after developments such as it launching subsidiaries in China, Japan and Australia, and growing its membership…
Our vision is to cement ourselves as the most entertaining global membership community for single malt Scotch whisky. International markets have seen the fastest membership growth and now represent half of our members and about two thirds of our sales. The business has had global ambitions for a long time – it’s really about carrying on along that trajectory.
We’ve come a long way already – we first expanded internationally in 1995, initially into France, Japan and the US. In a similar vein, we’ve been launching international whiskies since 2002 – our first venture into that market was a Japanese whisky.
Now in 2021 we have a presence in more than 30 international markets, so the goal is to keep building on that progress, while working to roll out a model overseas that is consistent with the one we have in the UK – making sure we’ve got a direct-to-member route to market.
How does ASC’s activity fit in with an increased focus in society on responsible drinking?
Our spirits are all limited edition, intended to be consumed slowly while savouring every drop. Our members want products they can fully experience, enjoying every subtle note, so we work tirelessly to create interesting and unusual products with tremendous depth.
At the same time, though, we take our responsibilities as a provider of alcoholic spirits very seriously. As a society, we actively encourage a moderate approach, adding water to look at the whisky evolve and the conversation in the glass.
To what extent are you benefiting from people increasingly interested in buying “experiences”/being more interested in provenance/history/traditional skills behind products?
We’ve always been a bit before our time on that front – providing experiences rather than spirits. We’ve created a society with provenance, history and tradition in its DNA. Undoubtedly the wider market is now starting to better appreciate that side of things, and we’re in a really strong position having laid the foundations decades ago.
You have more than two decades’ experience in the international wines and spirits industry. Can you discuss your career path to date, and what has been the most pivotal moment?
My career has been fairly unconventional in that I started out in an IT role and quickly found my responsibilities shift more towards the sales and marketing side of things, which is where I found my calling. I then went on to study an MBA, majoring in marketing, and that’s the field where I have spent the majority of my career since.
As for the pivotal moment, having failed to get a role I was pursuing after graduation, the recruitment company said they’d keep my name on record and I didn’t expect to hear from them again. Needless to say, they got back in touch with a post and I quickly found myself at Moët Hennessy for almost two decades.
If we look to 2023 – 40 years after the SMWS was founded – what would you like ASC to look like?
This might sound like a cop-out, but really I’d like to see us doing more of the same, delighting members and being successful together. We’re on a strong path that we’ve been on for some time, and I’d like to see us continue; crafting unforgettable spirits, growing our membership both in the UK and internationally, and developing our people.