Building upon a heritage that stretches as far back as 1888, today Altia is the largest producer and importer of alcoholic beverages within the Nordic and Baltic countries. Whilst the business has understandably undergone a major overhaul during these 123 years of operation, with a net turnover of 500 million euros per annum it is clear that Altia continues to dominate its markets. Present within Finland, Sweden, Norway, Denmark, Estonia, and Latvia, each year Altia handles approximately 200 million litres of wine and spirits through its logistics system.
“Our main clients are the Nordic monopolies in Finland, Sweden, and Norway. We also supply all of the main hotel and restaurant chains in each of our core markets, as well as retail chains within Denmark and the Baltic countries. Primarily our products are local or regional alcoholic beverages such as vodka, cognac, whisky and wine. Within all of these categories we have products that are currently ranked as number one or number two in their respective markets,” elaborates Antti Pankakoski, managing director of Altia.
The production of Altia’s own products relies on its long experience and extensive expertise. Located in Finland, the company’s Koskenkorva plant has distilled ethanol for more than 70-years. A modern distillery, the plant uses a 250-fold distilling method to produce 96 per cent grain spirit from Finnish barley. The quality of this spirit gives Altia’s proprietary products a significant competitive edge. “We also have three bottling facilities – Rajamäki in Finland, Tabasalu in Estonia, and Svendborg in Denmark. Given the nature of the business, each of our main markets also has a dedicated logistics centre, as well as a sales and marketing operation,” adds Antti.
As well as the production of its own branded beverages, Altia imports and distributes major international brands from all over the world such as Jack Daniel’s, Hardys, Nederburg, Ravenswood, Bowmore, Codorniu, Drosty-Hof, and Robert Mondavi. Antti explains how these global brands strengthen Altia’s market offering: “In terms of volume about half of our portfolio is global brands, and the other half is our own branded products. Having these two different lines of business gives us considerable synergies with regards to logistics, transportation and warehousing, which in turn translates into increased efficiencies. Additionally, this approach enables us to offer our clients the best of both worlds in terms of product range.”
Many of Altia’s products, including brand names Explorer, Grönstedts, Koskenkorva, Maximus, Renault, and Skåne Akvavit, have a long market heritage of more than 50 years, and still retain a market leading position. The strength of the company’s portfolio is also apparent from its market standing in Finland where Altia commands approximately 40 per cent of the spirit market and 30 per cent of wine, and Sweden where its market share is closer to 30 per cent in the spirits market. With figures such as these clearly indicating Altia’s expert understanding of its core markets and the demands of consumers in this region, Antti highlights its commercial capabilities: “We operate our own market research department Altiawhich is critical for us in terms of consumer insight and understanding market trends. We also deliver this service to our imported brand owners to help them understand what does and doesn’t work within these markets, and this is then implemented into their own sales and marketing plans for the region.”
At present Altia is currently in the midst of a major new logistics restructuring programme designed to improve the efficiency of these operations. Given that approximately half of the company’s annual turnover, at a value of 250 million euros, is spent in the purchase of goods and services, it apparent that Altia’s strong supply chain is of paramount importance to the business. “Having a good supply chain is not only of utmost importance to us in terms of a financial perspective, it is also what enables us to provide an impeccable service to our customers,” notes Antti. “These kind of improvement programmes are something we implement on a continuous basis in order to ensure that we are not only a market leader in terms of service, but also the most efficient.”
In 2010, Altia acquired a number of Swedish and Danish assets from Pernod Ricard, including a portfolio of market-leading brands, the Svenborg bottling facility, and two logistic centres located in Årsta and Odense. This investment has helped create a strong market presence for Altia within Sweden and Denmark. Last year also saw the business acquire the cognac brand, Renault, which as a strong and widely recognised trademark helps to reinforce Altia’s presence in the Nordic market.
Strategic developments such as these were key driving factors behind Altia’s impressive achievement in tripling its profit in 2010, based on figures from the previous year. With statistics such as these behind the business, and its ongoing operational and logistics developments set to deliver further benefits, Antti is confident in the business achieving its next set of goals: “Our ambition is to double the size of the business from where we stand today by 2015, and in line with that, we want to substantially increase the profitability of the business. We will achieve this by continuing to grow the business originally but also through certain acquisitions, which we hope to be able to make in the next few years.”
Products: Alcoholic beverages