Official source: Fortune Greece.com
Is it feasible today that a Greek company could afford to share profits with its employees, while, in the rest of the business world, human resources are among the first to suffer when cutbacks strike? In 2016, Amvyx shared 15% of its profits to employees, proving such practices still viable in our time of recession. The leading Greek spirits importer and distributor figured among Fortune magazine’s fastest-growing companies, has gone against all odds and recruited in spite of the recession, increasing its workforce by 20%.
The company now boasts 100 years of history in the Greek spirit market. No less than one century ago in Thessaloniki, Albert Revah and his two partners started Amvyx, a small company importing and distributing foodstuffs and spirits that reached Greece from all around Europe. Then in its heyday, Thessaloniki was considered the most important hub of Greek trade; businesses that managed to be successful there were bound to spiral upwards. Amvyx grew with time, bringing naturally sparkling mineral water Perrier back to the Greek consumers and achieving sky-high sales for Absolut vodka, making Greece one of the top five consumers in the world.
One century into the business, the company has every right to raise a glass to growth. It is, after all, the most historic importer, marketer and distributor of spirits in Greece, with a market share of 20% and a workforce of 130. Based on annual turnover, Amvyx is the leading Greek company in the industry, while it comes second in the overall ranking competing against multinationals. Working with the vast majority of retailers, as well as more than 700 wholesalers, the company features at least one product at each on-trade point. So far, it has been entrusted with the management of about 70 brands by 20 houses in Greece and abroad, with a portfolio boasting more than 400 products.
In 2016, the agreement signed with Bacardi, the world’s largest privately-owned spirits company, regarding the distribution, sales, and marketing of the company’s entire product portfolio in Greece, was a milestone for Amvyx. At the same time, new departments and structures were created, and the company’s portfolio was broadened; as a result, the annual turnover increased by 40%. The year 2017 also started with a bang, as another distribution agreement was signed, this time with Patron, the world’s fastest growing tequila brand, while the first quarter saw a 45% increase of the overall business activities.
A significant part of the credit for this successful course is due to the person running Amvyx over the past two years, exploring new horizons and boosting prospects. Yannis Artinos served as CEO of Vivartia, Deputy CEO of MIG, and General Manager of P&G. Upon taking over as General Manager in Amvyx, it was only natural that he should raise the standard, as he considers this new beginning in the spirits industry quite a personal challenge.
A true perfectionist, Artinos simply loves what he does and always tries to improve in any possible way. One gets the impression that doing business with him is like playing for the champions; he may be demanding, but also willing to give chances to those who deserve them. These very qualities were probably valued by the Revah family in their decision to pass the reins of Amvyx to an executive with long experience in some of the most powerful groups in the Greek market. “Recession has made us wiser. I believe that, if we build on this experience, we can become model European citizens – as long as we do not forget these valuable lessons,” Artinos told Fortune magazine. He also underlined that Amvyx has managed to flourish in the face of market adversity, which gives executives every reason to be optimistic. “What is more, the company has paid €375 million of direct taxes to the government, providing significant support to the Greek economy. Our goal for the next three years is to become the industry leader and pay off our bank loans, which already stand at historically low levels,” he explained.
Growth in the face of heavy taxation.
To realise just how successful the course of Amvyx was in the period 2012-2016, when the company’s annual revenue went up by 60% and its market share doubled, one simply has to compare this success to the overall slump in the spirit production industry in Greece. According to official figures provided by the Hellenic Association of Drinks Distributors (ENEAP), the per capita consumption has dropped by 51% since 2009, with the overall decrease reaching a grim 55% if compared to 2004. Two thirds are absorbed by the food industry, while the remaining one third reflects consumption at households. To make things worse, the Special Consumption Tax (SCT) was raised by 125%, while the VAT climbed from 19% to 21%, before soaring to 23% and eventually 24%; combined, those measures increased the overall tax imposed on an average bottle of spirit to a whopping 70% of its price. This means that, for a product with a shelf price of €18, the government receives a generous €12 (between the SCT on alcoholic beverages and the VAT), while the retailer, the distributor and the producer have to split the meagre remaining €6! As a result, details Artinos, the companies in the industry were forced to implement offers and adopt aggressive pricing policies, which allowed them to get back on course over the past two years. One can only hope for stability; progress – if it does come – will be feeble. “Since August, the industry has seen a growth rate of 1%. Tourism was the main force behind this development, as it provided a systematic boost in consumption over the summer season compared to the first months of the year, during which growth was negative,” Artinos explained, before adding that the steep decrease of retailers, partly due also to the rearrangement of the supermarket industry, was counterbalanced by an increase in the number of food service businesses, with many choosing to invest in cafes and bars. The recession also made Greeks turn their backs on the golden era of splurging on traditional bouzoukia and clubbing, in favour of cosier – and much cheaper – venues. “The recession forced consumers to become wiser. One can see that today’s youth are more selective and sophisticated, demanding top-notch products and services. Unfortunately, we are not yet a service society, and it will take a lot of effort to make significant progress in that respect, though we must admit that the quality of services provided has indeed improved, as consumers demand value for money.”
Spirits, in any case, are not like other consumer goods. They fuel and are fuelled by our need to socialise. They do not respond to practical necessities; on the contrary, they are valued for the emotional comfort they may provide. Over the past few months, consumers seem to develop a taste for white spirits, mainly rum, vodka, champagne, wine, and tequila, while whisky remains a firm favourite with a growth of 7%.
“We are the industry’s only company to include wine and beer in our portfolio alongside our other spirits, and this is what allows us to stand out from the competition. Another asset is that the brands we manage come first in all the categories in which we compete. Last but not least, the fact that our seat of operations is not abroad but at home, in Greece, enables us to decide fast and gives us a competitive advantage.
Artinos told Fortune magazine about the newly cemented partnership with Greek dairy and juice producer Delta, regarding the distribution of the latter’s Life juice range through Amvyx’s network, mirrored by Delta’s distribution of Amvyx’s Lucozade to small retailers. “This strategic alliance may be still young, though it can only be beneficial for both companies. At the same time, we are currently very close to signing agreements with large Greek spirit producers,” he added.
When it comes to drawing up a business plan for the future, Amvyx will make sure not to lose sight of the three strategic pillars on which a century of success is based: ensuring healthy growth for brands, creating added value for partners, and boosting skills in human resources.
Article in its printed form here.
Amvyx is included in the 30 fastest frowing companies that manage to stand out for 2017.
View the official list here.