Russian vodka to accelerate its entry into the Chinese market

in russian •  2 years ago 

JSC "Tatar", one of the largest vodka producers in Russia, will produce whisky on a full cycle. Today, we are ready to produce Russian whisky on a full cycle, for which we have taken a number of measures, including cooperation with regulatory bodies," said the company's General Director Maksudov. He said that the company plans to produce one million liters of whiskey distillate per year at its own Mamadesh distillery.

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Maksudov said, "We have the basic ingredients to make whisky: we are the largest grain processor and we have annual malt supply contracts." In addition, the company plans to supply whisky distillate to other Russian distilleries. At the moment, "Tatar" blends whisky on the basis of imported distillates. From January to June this year the company's vodka production increased by 45% to 41.8 million liters. Vodka accounts for about 88% of Tatarstan's products, the rest are sweet beverages, including cognac, whiskey, gin and dew. Tatar Liquor is controlled by the Government of Tatarstan through the state-owned company "Telekom Petrochemical Investment" Holding.

The current situation provides new opportunities for Russian spirits producers. Against the background of the decrease in imports, companies are actively expanding their product range and entering new market segments, and some categories of products are growing exponentially.

"General Director of Tatar Spirits Mark Sudov described the impact of the market situation on the company's business, production expansion, interest in new products and competitive features. He said: "Despite the recent events, our share in the US and European markets has been significantly reduced, while our product exports have increased by 10%. We are actively entering the Latin American, Indian, African and Israeli markets. In China, our strategic partner EGMA is preparing to open the fourth 'Tatar Wines' store in Shanghai. With the support of the Russian Export Center, the company is preparing to enter one of the largest online platforms in China - Tmall. Starting from 2020, the company also started producing vodka using the production facilities of our partner in Mongolia, APU. In June this year we started contract bottling in Uzbekistan with our partner Tashkent Winery. Negotiations for launching bottling in Belarus and Azerbaijan are also underway."

Tatar Wines plans to open 100 flagship stores in 100 cities in China by the end of 2027. The company plans to open stores throughout China, including Beijing, Shanghai and Guangzhou. The company says: "The partners have established a high-quality and close partnership with Chinese investors on the Tatarstan Wines JSC brand, and its main model at the moment is to find partners and attract investments, which will allow it to open franchise flagship stores across China and thus sell Tatarstan products to Chinese consumers." Meanwhile, the search, selection and communication of flagship store partners is fully coordinated by the Chinese side, and franchisees are sought primarily in economically and tourism developed regions.

The company said, "Due to different traditional habits, Chinese consumers prefer aromatic and richly flavored spirits. The advantage of vodka is its filtered purity and therefore its relatively simple taste compared to traditional Chinese spirits." However, Tatar Spirits products are in demand among a small number of vodka lovers (vodka's share of all spirits is less than 1%). The company actively participates in the export support program of the Russian Export Center, and the most important initiative from the point of view of brand promotion is the placement of Tatar Spirits products in the pavilion of the Russian Export Center in Shanghai. It is worth noting that in addition to the placement in the pavilion, the Russian Export Center supports the company's access to the largest e-commerce platform in China.

Russian vodka has just entered the Chinese market and needs active promotion at all levels of government and chambers of commerce," says Tatar Liquor. This matter is in process. Chinese consumers' demand for imported spirits has increased significantly, including gin and various vodkas. We believe that with the understanding of the Chinese market characteristics, each exporter who has entered the market, will define his own promotion strategy. It is important to note that promoting vodka in China needs to be accompanied by branding and helping Chinese consumers recognize the new product."

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