Review of Global Vodka Market

Topics: Russia, Alcoholic beverage, Vodka Pages: 2 (658 words) Published: July 31, 2008
Review of Global Vodka Market

Today it is tough to determine which country has the top conditions for alcohol distilling industry and where this business is most profitable. In many countries alcohol distilling and distribution is on-budget, which means existence of certain peculiarities of state control. For instance, EU today faces the problem of hard drinks “redistribution” between the countries. Transparency of borders and differences in excises determines economical interest of operators for such actions.

In Russia and Ukraine main profit from distribution of standard vodka is received by the state – get about $1 on every bottle of vodka, in Russia they get even less, and in the USA – $3. The cheapest vodka is sold in Byelorussia and Middle Asia countries, and the most expensive – in countries with state monopoly on alcohol. Range of middle-price vodka category depends on income of population. For instance, in Russia 0.5 liter bottle costs $3-4.5, in Canada – $19-20, and in Scandinavian countries – $25-27. Yet in our country there are no cheap substitutes of vodka except for fraud product, and in Canada they sell cheap whisky in large cans for $2-3 per liter.

Irrespective of applied promotion techniques operators of vodka market have to pay for their presence in retail or in HoReCa. In Russia payment for presence in large retail chains reaches $50 thousand annually, and in Ukraine – $20-30 thousand. In Poland this costs on the average €1 million, in Germany – €3 million. In West Europe the right to sell their products in any of retail outlets costs manufacturers about $100 thousand. Payment for presence in any club is even higher than for presence in retail.

In product promotion, vodka companies have to consider national peculiarities of vodka consumption. Vodka is consumed pure in CIS countries and Poland, in cocktails – in the USA, England, Germany, China and India. In West Europe hard drinks are taken after meals and not before or...
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