Ask the Collective
The questions independent drinks founders ask most — answered. Distilled from years of community knowledge so the good stuff never disappears in the feed again.
How should you structure wholesale, retail, bar, and ecommerce pricing when selling through multiple channels?
The key principle is to avoid channel conflict by keeping pricing aligned across wholesalers and retailers, then building your model backwards from RRP. Many large UK wholesalers (Matthew Clark, LWC, Carlsberg, Molson Coors) don't supply retailers, so don't assume a traditional retail-first model. **Pricing structure for spirits (example: £40 RRP):** - £40 RRP / 1.2 = £33.33 exc VAT (your net sell-out price) - Apply 25% retail/wholesaler margin: £33.33 × (1 – 0.25) = £25 Wholesale Selling Price (WSP) - Subtract duty (c.£9 for a 70cl spirit at 40% ABV) = £16 net WSP - Typical gross margin target: 65%, which yields ~£5.60 COGS **Key caveats and variations:** - Gross margins vary by channel: 45% for retailers/wholesalers down to 10% in some cases - **Exclusive distributors** typically require 20–30% gross margin on net sales (can be higher or lower depending on volumes) - Wine, RTD, and beer margins differ significantly from spirits - **Direct-to-bar pricing:** Set this at the wholesaler sell-out price (£33.33 in the example above) to avoid undercutting wholesale customers. Some members set it between wholesale and ecommerce prices. - **Independent retailers:** Price at the same level as direct-to-bars (the wholesaler sell-out price), as they typically order smaller quantities - **One unified price across wholesalers and retailers** is strongly recommended, especially when companies operate multiple channels or face buyouts (Matthew Clark/Booker/Tesco scenarios). Members warned that having different pricing models for different channels creates exposure during consolidation and can be "a world of pain." You can always add retroactive incentives or volume discounts without changing base pricing. **Important warning:** Major acquisitions in distribution (e.g., Bargain Booze buying MCW, Tesco buying Booker) have historically created significant problems for brands with inconsistent pricing across channels.
How should indie drinks brands approach pricing strategy—setting wholesale discounts, communicating retail price increases, and managing annual wholesale price hikes?
Pricing strategy for indie brands involves three main challenges: wholesale discount structures, communicating retail price increases to consumers, and managing annual wholesale price rises. **Wholesale discount structures and RRP enforcement** - Members recommend working backwards from your recommended retail price (RRP ex-VAT) to set wholesale costs. A **20–30% discount** to RRP is typical starting territory, though this varies by retailer and volume. - Online players like **Master of Malt** consistently undercut RRP due to their margin structure; this is a common industry issue. You cannot legally dictate retail prices—only recommend them—so "RRP" is advisory only under UK competition law. - If a wholesaler is damaging your brand perception through heavy discounting, the option is to raise the price you charge *them*, but be prepared that they may drop the listing. Members report this is a negotiation point, not a mandate. - Contact at Master of Malt: **Julie Trewren** (julie.trewren@masterofmalt.com), ex-Matthew Clark buyer, joined by **Lisa Halstead** as her deputy. **Retail price increases and consumer communication** - The way price increases are communicated to consumers is critical. Members suggest adding modest amounts per bottle (e.g., £1) rather than large jumps, and explaining the cost drivers clearly. - One member who had not taken a price increase for 9 years (at Don Papa) found their first increase was too cautious in hindsight. Major brands are more assertive; for small indies, weigh whether a price increase or margin erosion is more painful long-term. **Annual wholesale price increases** - Most wholesalers require price change notifications by early October for January 1st implementation. - General principle: costs rise, prices should rise; holding back builds long-term margin problems. Buyers will always reject increases initially—that's their negotiating role. - You **cannot discuss price increase levels** with competitors (this breaches UK competition law on cartels and price-fixing). Each brand must set increases independently based on their own cost movements. - Recent inflation has stabilised dry goods after double-digit increases; French importers are estimating **5% maximum** price maintenance depending on volume and negotiations. **New product pricing research** - For launching new products, members recommend **Simon at SH Foodie** (simon@shfoodie.com), who conducts tabletop trials with a few hundred units and is described as helpful and collaborative. This has been useful for brands like Bloody Drinks. **Caveats** - Do not discuss specific price increase percentages with other brands—this is illegal under competition law. - Wholesalers operate on different margin structures than traditional retailers; accept that online discounting is difficult to control.
How should spirits and drinks businesses manage pricing in response to duty increases?
The 1st August duty increase is coming, and members recommend being proactive rather than deferring price rises. Here's the collective approach: **Timing and cash flow:** - **Duty comes into effect 1st August** — this is a firm date to plan around - If cash flow allows, **duty-pay stock on 31st July** rather than pre-selling ahead of the increase, to avoid locking in old duty rates - Prepare for the cash flow impact of a 10% increase in duty when calculating working capital needs **Pricing strategy:** - **Stick to your guns on pricing** — don't erode margins by absorbing the increase. The trade expects price moves from major brands, so your customers are psychologically prepared - **Don't lowball the increase.** Deferring pricing just "kicks the can down the road and makes the pain worse." The last decade of low inflation was the aberration; price increases are a normal part of the business cycle - **Check wholesaler maths carefully.** When wholesalers calculate duty-paid pricing and ask you to confirm you're passing it on, verify their numbers — they sometimes get it wrong - **Use price increases strategically.** An increase may let you break a price barrier in the market (e.g. moving from £9.99 to £10.99), which retailers appreciate since they like fixed price points (£9.99, £10.49, £10.89, etc.). This can actually generate more margin per unit **Market context:** - Major brands have been taking increases for over a year, so the trade is already expecting them from smaller players - Everyone faces the same cost pressures — glass prices are rising with limited suppliers, so the entire market will generally move in the same direction - Price increases drive premiumisation; the gap between price points narrows, making premium positioning more valuable - If a customer pushes back saying "I know how much it costs," point out that own-label doesn't command a price premium for a reason — your brand positioning justifies the price **Caveat:** Don't describe increases as a "necessary evil" — frame them as normal business management. This mindset will make the conversations easier.
What third-party logistics providers can handle Amazon FBA repacking, B2B sample distribution, and e-commerce fulfillment, and what are typical pricing benchmarks?
Members recommend keeping sample/e-commerce fulfillment separate from pallet logistics, and have shared detailed pricing from several 3PLs handling duty-paid stock. **Repacking & E-Commerce Fulfillment:** - **The PHL Group** — handles duty-paid stock only; one member uses them via Packfleet for London-based operations - **Delamode Logistics** (Braintree) — members recommend with offer to make introductions; potentially open to negotiated rates if volume brought collectively - **Fodafilment** (via Packfleet) — London-focused; note they handle cans, but structure adaptable - **SKU** — flagged by members as comparatively expensive; includes packaging in pick-and-pack pricing **Pricing Benchmarks (all figures ex VAT where noted, or as quoted):** - Pick & pack: £0.22–£0.82 per item or £1.21–£1.45 per case (second+ cases cheaper) - Storage: £3.10–£4.00 per pallet per week - Shipping (single bottle, 48–24hr): £2.71–£5.07 (Royal Mail 48hr cheapest at ~£2.71–£3.88; next-day freight ~£3.66) - One member (Codestorm, higher volume): process/picking £2.40 (up to 3 bottles), storage £4/pallet/week, single-parcel shipping £3.66 next-day or £2.71 RM 48hr - Canmaker pricing (non-acl, 12-pack cans): pallet storage £3.66/week, case pick-and-pack £1.45 first case / £1.21 additional, overnight delivery £4.78/parcel (4 cases fit in outer box) **Key Caveats:** Members note that many 3PLs require duty-paid stock only and pricing varies significantly by volume (1.5–4k orders/month cited as benchmark range). Bonded-delivery services are a separate question; DPD 24-hour options mentioned alongside Royal Mail. Packaging costs may or may not be included — confirm explicitly. One member suggested collective negotiation with Delamode if volume can be pooled.
What is a reasonable budget for Shopify website development?
A £10k quote for Shopify development is considered high by the community. Typical costs depend heavily on complexity and whether you're using an existing theme vs. bespoke coding. **Pricing benchmarks:** - **Theme-based builds (no custom coding):** £1,500–£3,000. Members report paying around this range when a designer provides the design and a developer simply implements it on a Shopify theme. - **Hourly rates:** £30–£50/hour is typical. One member suggests calculating whether the quoted hours are realistic—a £10k quote at £50/hour implies 200 hours of work; consider whether that's justified for a theme build. - **Negotiation expected:** One member received a £10k quote that dropped to £6k within an hour of feedback, suggesting initial quotes are often inflated and should be challenged. - **Bespoke/custom coding:** Half the theme price or slightly more, depending on complexity. **Recommended developers:** - **Simon (Simongreenbox@gmail.com):** South African-based developer who has worked for multiple members. Charged £1,500 for a full build five years ago; now around £50/hour. - **Valley Gal (Sarah at valleygal.co.uk):** Email marketing and e-commerce optimization specialist; members recommend checking they provide a fully editable site and clarity on ongoing support needs. **Key considerations:** - Ensure the final build is fully editable by you and doesn't lock you into ongoing development costs unless necessary. - If e-commerce is a core revenue channel, budget for continuous improvement and conversion-rate work (one member invests ~£2,000/month on this). - Get multiple quotes and don't accept the first price.
What are typical fulfilment and packaging costs for direct-to-consumer bottle orders in the UK?
Members report D2C fulfilment costs for a standard 70cl bottle shipped to mainland UK typically range from **£4.84 to £5.20 per order**, excluding shipping (or sometimes including it—clarify with your provider). Costs vary significantly depending on whether the supplier is bonded. Specific providers members use: - **The PHL Group** — £4.84 per order, non-bonded fulfilment - **Codestorm** — similar pricing to PHL Group (£4.84–£5+), with standing monthly charges; members report orders average just over £5 when accounting for the monthly fee - **Law** — approximately £7.80, but this is from bond (bonded storage/fulfilment), which explains the higher cost **Caveats:** Bonded fulfilment is notably more expensive than non-bonded. Most quotes include a standing monthly charge on top of per-order fees—factor this into your average cost calculation. One member mentioned cutting **Fodafilment** and indicated their "final offer" pricing was available if needed, suggesting some room for negotiation. Always confirm whether quoted costs include shipping or are fulfilment-only.
How should small drinks brands approach seasonal discounting (Black Friday, Christmas) without destroying margins and brand value?
Members emphasise that deep seasonal discounting is often a losing game for small premium brands. The consensus is: **don't participate unless it genuinely works for your business model and customer base**. **Strategic alternatives members are using:** - **Clear slow-moving or nearly-expired stock** — Several members use Black Friday/seasonal periods specifically to liquidate dead inventory at discount rather than applying across-the-board cuts. This frees cash from working capital without eroding core product margins. - **Modest, purpose-driven discounts** — One member runs "Green Friday" offers on B Corp soft drinks with tree-planting tied to sales, reframing the event around values rather than race-to-bottom pricing. - **Tiered discounting** — Offer small discounts on core range (e.g. 20%), larger discounts on slow-moving SKUs only. This protects your flagship products while moving problem stock. - **New customer acquisition campaigns** — Position it as a trial/tasting campaign rather than a blanket sale. Members note it can work for customer discovery if margins allow. - **Skip it entirely** — Several premium brands simply don't participate. One importer cited the "Huit Denim approach": close the website, reopen after the event when "common sense returns." Multiple members note that for premium aged spirits at £25–£50, the math rarely works—you attract cheaper customers, spend heavily on ads to reach them, and end up with zero margin. **Key warnings:** - Seasonal discounting in premium spirits is often a trap. Customers buy rum 2–3 times a year anyway (Christmas gifts, birthdays, Father's Day); heavy Black Friday discounting doesn't create incremental volume, it just shifts when people buy and at lower price points. - Turnover is vanity; margin is sanity. Don't get sucked into a race to the bottom you can't win. - Massive competitor discounts (e.g. Diageo's aggressive pricing) make modest 20% offers look pointless and devalue the entire category. - Advertising costs to acquire discount-hunting customers often exceed the margin you make. **The underlying advice:** If running Black Friday isn't profitable within 60 days *and* doesn't align with your brand values, skip it. Focus on making the rest of the year succeed and selling less at higher margin.
Should you price bottles lower with lower retailer margins/listing fees, or higher with higher margins/listing fees?
Members consensus is strongly in favour of **higher bottle price with higher retailer margins and listing fees**. **Key reasons cited:** - **Pricing control** — higher prices give you more control over how your product is positioned and discounted in the market - **Higher GP%** — the higher margin protects your gross profit - **Downside protection** — if the product doesn't sell through as fast as forecast, you have more cushion to absorb slower movement without eroding profitability This approach is particularly important for craft spirits where market positioning and perceived value matter.
Which delivery carriers should D2C drinks businesses use, and what pricing strategies work best?
Members recommend a tiered carrier approach based on order size, with free shipping thresholds to encourage larger orders. **Carrier recommendations:** - **DPD** — the most popular choice among members for orders over 2 bottles; noted as reliable, though members emphasize the need for hardcore packaging as DPD handling can be rough - **Royal Mail** — used for smaller orders (under 2 bottles) as a cost-effective alternative - **UPS** — currently used by some members, though at least one is switching away from it to DPD - **Amazon shipping** — avoid; one member using BlueCloud fulfilment reported roughly 10% of packages were delivered to wrong address or not delivered at all - **Hermes** — explicitly flagged as unsuitable ("DONT USE HERMES!!") **Pricing strategy:** - **Free shipping on orders of 2 bottles or more** — this threshold encourages larger basket sizes while keeping costs manageable - Members debate between higher price + free shipping versus lower price + slower delivery; the consensus leans toward free shipping on minimum order thresholds **Packaging note:** Invest in robust packaging regardless of carrier; DPD in particular requires hardy materials to protect bottles in transit.
What margins do independent pubs and on-trade retailers typically expect when purchasing spirits and drinks?
Independent pubs typically look for **60–75% margin**, with **70–72% gross profit** being the standard expectation. It's important to note that this margin is calculated relative to the per-serve price they sell at, not simply as a percentage of the purchase price (e.g., 10 serves × 6 = 60 vs. the purchase price of 20). Margin expectations vary by channel: - **Independent pubs**: 60–75% margin / 70–72% gross profit - **Wholesalers**: 10–25% depending on product type - **Off-trade**: 25–40% - **Promotional products**: Around 30%, potentially lower if positioned as a footfall driver Members have also asked about specific major retailers (DDC, Majestic) but concrete margin data for those chains was not shared in the discussion. The **Gross Profit app** (iOS) was recommended as a practical tool for calculating margins more easily.
How are UK drinks brands managing glass packaging cost increases, and what negotiation strategies are working?
Members have faced dramatic glass packaging price increases in 2022, ranging from 17% to over 20% from major suppliers, with some seeing increases as high as 35% for European-sourced glass. The increases are primarily driven by energy cost spikes rather than material scarcity. **Negotiation and pushback strategies:** - **Request pricing logic** — Push back on increases and ask suppliers to provide detailed maths and justification behind the price rise figures. - **Secure stock with forward purchase orders** — If your supplier already has inventory pre-ordered or in stock in the UK, negotiate a purchase order for a chunk of glass at the old pricing before the increase date takes effect. This locks in pre-increase rates. - **Compare notes with peers** — Members are actively sharing specific increase percentages and supplier names (e.g. Allied Glass, Bruni) to understand whether offers are in line with market reality and to identify negotiating positions. **Key suppliers mentioned:** - **Allied Glass** — UK supplier; increases quoted at 19–20%+ - **Bruni** — German/European manufacturer; bespoke bottles carry long lead times (10 months+) and high setup costs (£25k+), limiting flexibility to switch **Caveats:** Members noted that even UK manufacturers are passing through the same energy-driven increases, so the issue is sector-wide. If you're locked into a bespoke bottle with a supplier like Bruni, you have limited recourse to reject the increase without restarting an expensive, lengthy production process. Securing pre-ordered stock before price-change dates is the most concrete tactic identified so far.
What are the current bonded warehouse pricing trends and service issues in the UK, and which alternatives are members using?
Members are reporting significant price increases across UK bonded warehouses coupled with stretched service levels. **LCB** has raised landing charges from 50p to 75p per case and storage from 6p to 7.5p per week; they're also experiencing capacity constraints with 3-day landing times and 7-day rework turnarounds, plus strict policies on late deliveries. Current pricing varies slightly by operator—**Horseguards Gin** reports goods-in at 67p and storage at 7.25p per case of 6. Members note the sector is experiencing high demand across the board, driving prices up while service levels decline. Alternatives members are exploring: - **FuturePro Logistics** — used successfully at Seedlip and still in use there; contact Mark@futureprologistics.com, +44 7766 114 897 - **EHD** — praised as not expensive, quick for landing, and offering decent delivery rates Members' general sense is that capacity is tight across all warehousing operators. Those considering alternatives should factor in both pricing and service responsiveness when evaluating providers.
Should alcohol duty be included in or excluded from margin calculations?
Whether to include duty depends on your purpose, but there are two distinct approaches: **For internal analysis and strategy:** Exclude duty from margin calculations. This approach is cleaner and more useful because: - It allows meaningful comparison across different channels (duty-free/export vs. UK domestic sales) - It keeps margins consistent when duty rates change—important because you typically can't pass duty rate increases directly to customers without them accepting the cost increase separately - It gives you a true picture of what's fundamentally changing in your business **For retail/wholesale customer discussions:** Include duty so your customer's margin calculations reflect their actual landed costs. **Key principle:** Members note that duty is not reclaimable like VAT, so it cannot be treated the same way. The standard approach among strategic-minded producers is to exclude duty when benchmarking gross margins, especially since duty rates vary hugely internationally. This avoids the problem where a duty rate change on 1 February (for example) would artificially depress your reported margin percentage despite nothing fundamentally changing in your operation. One member flagged that duty-suspended calculations are more complex and less commonly used.
What margins do drinks distributors typically expect, and which distributors offer competitive rates?
Distributor margin expectations in the drinks industry typically range from 23–30%, with 23% appearing increasingly common. **Cotswold Fayre** and **Jumpstart** have both quoted 23% to members; one distributor quoted 30%. Members report that margin percentage alone isn't the deciding factor—distributor efficiency, responsiveness, and ease of working relationship matter significantly. Members who accepted 23% margins from **Cotswold Fayre** and worked with them from January onwards reported they were "much better to deal with and more efficient than others that have asked for more," making them "worth a punt." **Jumpstart** has also been described as "quite good" to work with. The consensus is to negotiate and compare not just on margin percentage but on operational support and reliability.
What pricing structure should producers, wholesalers, and retailers use to ensure adequate margins at each level in the spirits supply chain?
Members shared a community-created pricing model spreadsheet that maps out margin requirements across the supply chain when working backwards from a retail RRP. **Key resource:** The community maintains a shared Google spreadsheet that calculates required COGS, wholesale, and retail price points based on a target RRP and desired margin percentages at each level. This allows producers to determine what manufacturing cost they need to hit to ensure wholesalers and retailers each take their cut. **Important consideration:** The spreadsheet uses markup calculations for wholesale pricing (e.g., dividing by 1.2 to reflect a 20% markup), which differs from the margin calculation method used for retail. Members note this distinction matters—markup and margin are calculated differently. Clarify whether your business model thinks in terms of markup or margin percentage, as this affects how you apply the formula. **Access:** Request the current version from the community (the spreadsheet link is maintained collectively and may be updated). Members are actively refining the model and discussing the mechanics, so asking in the group will get you the latest version with any corrections applied. **Caveats:** The calculations assume standard VAT treatment and work backwards from RRP. The exact margins required may vary by channel (independent retailers vs. multiple retailers), product category, and distribution method, so treat the model as a framework to adapt rather than a fixed rule.
How should we price in response to rising input costs, and what increases are other UK drinks brands implementing?
Members are actively passing cost increases to both trade and D2C channels to protect margins ahead of potential exits. This is viewed as necessary despite concerns about losing accounts. **Observed pricing moves:** - Ex-cellar increases of **3–5%** across multiple SKUs are common among smaller brands - Major producers (e.g. Molson Coors with Estrella) have implemented increases closer to **10%** - One member implemented their first increase in 4 years; another in 2 years - Some brands (e.g. Lucky Saint) have *reduced* prices, signalling different strategic positioning **Community consensus:** - Protecting margins is critical if you want a viable exit - Trade accounts expect increases and understand the cost environment (fuel, energy, ingredients all up) - Small brands needn't worry about losing hard-fought accounts over reasonable increases—customers know increases are coming industry-wide - **First increases after multi-year holds are more defensible** than frequent small hikes **Caveat:** One member flagged concern about bargaining power as a smaller brand, but the group consensus was that this worry is usually unfounded in the current cost environment.
What are realistic retail margins for premium spirits, and how do Ocado and other retailers calculate them?
Retail margin differs from markup: margin is calculated as (Sell Price − Cost) ÷ Sell Price, expressed as a percentage of the retailer's selling price (not your cost). Retailers focus on margin because it represents actual cash profit. **Ocado premium spirits expectations:** Members report **25–30% point of sale (POS) margin**, though this varies. However, margin negotiation is often secondary to the retailer's rotation targets—retailers care more about how much you'll invest to drive sales velocity and cashflow than the percentage alone. **Key margin factors:** - **Margin percentage inversely correlates with rate of sale.** Faster-moving products command lower margins; slower-moving premium lines can sustain higher margins. A retailer will accept a lower % margin on high-velocity Rémy Martin VSOP than on ultra-premium Louis XIII, because the absolute cash margin on Louis XIII is much larger. - **Wine margins are typically higher than spirits margins** (percentage-wise), reflecting different retail dynamics. - **Product value determines cash vs. percentage trade-offs.** A 20% margin on a £1,000 bottle generates more cash than 40% on a £50 bottle, so premium retailers prioritize cash margin over percentage. **Tools:** Members recommend **thinkMargin** app, which includes handy calculators for margin, cost, and price conversions to avoid confusion between markup and margin. When negotiating with retailers, be prepared to discuss your investment in driving rotation as much as the margin percentage itself.
Should drinks suppliers quote ex works or all-in pricing (including shipping) when selling to international distributors?
Members strongly recommend quoting **ex works pricing** to international distributors. This keeps suppliers focused on their core manufacturing business rather than logistics, and shifts the organisational burden to importers who are better positioned to handle it. Key principles: - **Quote ex works as your standard** — this is your baseline position and avoids you taking on logistics complexity - **Price list with ~15% variance acceptable** — some regional pricing adjustment is normal - **Be prepared to help occasionally** — in practice, you may end up assisting inexperienced or smaller importers with shipping arrangements to close deals, but this should be charged as an add-on on top of the ex works price, not built in - **Use pro forma invoices** — for at least the first 3 orders, then consider moving to formal payment terms (though this depends on importer size and reliability) The underlying logic: "We are in the manufacturing business not the logistics business" and "Let the importer do the legwork." As you grow, outsource non-core activities and focus on your brand edge and main skill.
What are the key considerations when deciding whether to use a distributor, and how should founders handle distributor demands for listing fees?
Members report significant frustration with distributor listing fees and upfront demands, which can substantially impact on-trade pricing and margins. **Core issue:** Distributors increasingly demand substantial upfront payments (described as €20k+ in one European case) before committing to stock your product, creating a barrier for smaller brands and affecting the pricing you can offer to on-trade venues. **Recommended approach to listing fee demands:** - **Push back firmly.** Members recommend declining unreasonable demands rather than capitulating. One founder's advice: "Tell them to have a lovely sleep in their bed." - **Understand the margin structure.** A member shared a detailed breakdown of costs and margins across distributors, wholesalers, and retailers (linked in the discussion), which helps founders see where the pressure points are and negotiate from an informed position. - **Be aware of how distributor margins compress your pricing.** The distribution chain analysis shows how each layer (distributor → wholesaler → retailer) takes a cut, ultimately affecting the price available to the on-trade and your unit economics. **Context:** Several members reported being asked for substantial fees or free stock with poor results, describing it as "being mugged for the Christmas party." The consensus is that if a distributor won't commit without large upfront payments, their enthusiasm for selling your product is questionable, and you may be better served exploring direct-to-trade or alternative routes.
What does CGA/Nielsen market data cost and how do you access it?
Market data reports from CGA and Nielsen range widely depending on scope. Members report **one-off reports** cost approximately £1–5k each, varying by whether you want category-wide or specific retailer data. For ongoing access, **annual subscriptions with providers like IRI** typically run £12–15k per year. One member noted they paid around £3k for a report a few months ago but wouldn't recommend it—so quality and value vary. The key variable is defining exactly what data you need (category-level vs. specific retailers) before getting a quote, as this drives the price significantly.
What are typical rates for freelance social media management including content creation, design, and influencer outreach?
Members are paying **£1,200 per month** for Instagram and Facebook management that includes a photoshoot, design work, and 3 posts per week across a 3-month retainer. This is presented as good value when it encompasses professional asset creation. For in-house or freelance arrangements handling 3–4 posts per week plus a newsletter and influencer outreach, members are exploring shared-cost models rather than traditional agency pricing. Several members indicated they found full-service agencies "fantastic but very expensive" and are considering dedicated freelancers or shared arrangements at fairer rates. Members recommend: - **£1,200/month retainer** — covers 3 posts/week, influencer outreach, and photoshoot/design work (verified current market rate) - **In-house or part-time freelance models** — more cost-effective than full agencies once you reach a certain scale; consider shared access to a dedicated person if spare capacity exists - **Ex-industry freelancers** — members noted that experienced people transitioning out of corporate drinks roles (including those returning from abroad) are available and worth exploring through personal introductions When budgeting, clarify whether asset creation (photoshoots, design management) is bundled in or charged separately, as this significantly affects total cost.
What's the best approach to pricing and managing international pallet shipping for distributors?
Members recommend offering distributors ex works pricing—let them arrange and pay for shipping rather than building logistics costs into your quote. This shifts the logistics headache and cost responsibility to the distributor. For shippers when you do need to quote, members mention: - **Hillebrand** — experienced and reliable for international pallet shipping, though noted as expensive. Praised for ensuring cargo arrives safely. - **ILaw** — recommended as knowledgeable operators; fellow members at MOTH use them and report they're responsive and professional. Members stressed that shipping costs and logistics have been volatile and expensive recently, so getting firm quotes early from distributors is essential before committing to pricing. The consensus is strong: **always sell ex works** to avoid being exposed to freight cost fluctuations and logistics complications.
What margins do mainstream supermarkets and discount chains typically expect on spirits and mixers?
Supermarket margins on spirits vary significantly by retailer tier and product category. **Mainstream supermarkets** typically expect 25%+ margin on standard spirits, rising to 30% on super-premium ranges. **Discount chains** (Aldi/Lidl) operate on much tighter margins of 10–12%. **Mixers** command notably higher margins at 40–48%. Note that ex-duty spirits can see margins north of 50%, which may affect your commercial model depending on duty status.
What are the current fulfillment and logistics pricing rates from recommended UK providers, and what should we expect to pay for storage, picking, packing and delivery?
Members have identified a Leicester-based fulfillment partner offering transparent pricing for both B2B and D2C operations. Here are the specific costs shared: **Storage & handling:** - £0.65 per cubic metre per day storage - £1.50 per order (includes first pick) - £0.40 per unit/carton for pick and pack - £0.05 per insert - £0.10 per case inbound goods charge **Delivery options:** - **Parcelforce Express24** — £5.98 - **FedEx 25kg** — £6.12 - **Yodel up to 3kg** — £3.79 - **Yodel up to 17kg** — £4.42 **Important caveat:** The provider is not yet bonded, though they are working towards bonded status. Members noted this may be a limitation depending on your product category and regulatory requirements. One member suggested creating a shared spreadsheet of fulfillment costs across different providers to help the community benchmark pricing.
How should we position our retail price to account for price barriers, competitor pricing, and margin vs. volume trade-offs?
Price positioning requires balancing consumer perception of value at retail price points against your cost structure and margin targets. **Key considerations:** - **Identify price barriers in your category.** Premium gin, for example, has a perceived ceiling around £30; positioning at £29.99 vs. £30.99 can significantly impact consumer acceptance and volume, even if the cost difference is small. - **Match quality to price point first.** The biggest challenge at launch is ensuring your product quality genuinely justifies the initial retail price in terms of perceived value for money, rather than setting price purely on production costs. - **Be prepared to accept lower margin to stay under a ceiling.** If rising COGs would push you above a key price barrier (e.g., £30 for premium gin), members recommend a commercial decision to reduce margin and stay sub-barrier rather than jump into a lower-volume, higher-price segment. - **Don't live in fear of breaching barriers as costs rise.** Eventually, price barriers break down as most competitors face the same cost pressures. Balance and consideration matter, but don't be afraid to increase price when needed. - **Remember volume vs. premium trade-off.** Higher volumes exist at lower price points (e.g., premium gin vs. super-premium gin), so a price increase may reduce unit sales but improve margin structure. **Caveats:** Price positioning is iterative and tied to retail strategy. Even if you're not selling direct to retailers initially, members recommend thinking about retail shelf price from the outset.
Which logistics providers offer competitive pricing for moving spirits under bond in the UK?
Members recommend two main bonded logistics providers for moving spirits pallets in the UK: - **Supply21** — noted as offering competitive pricing for bonded spirits transport; several members use them. - **Law Distribution** — highlighted as offering "by far the best value" for bonded logistics. If considering international routes (e.g. from China), **Albatrans** was specifically praised as "the most reliable" option, though moving product from China was noted as "a very challenging market". Members suggest shopping around, as pricing from current suppliers can increase over time—these alternatives may help drive better rates.
What margins do wholesalers and food service distributors typically expect, and how do these vary by product type and channel?
Distributor and wholesaler margins vary significantly by channel and product positioning: **By channel:** - **Wholesalers** typically expect 10–25% depending on product type - **Off-trade** (bottle shops, retail) expect 25–40% - **Premium/super-premium products** sold by the bottle can command higher wholesaler margins, sometimes up to 30%, especially when distributed through specialist merchants like **Amathus**, **Venus**, **Ellis**, and **Hammonds** **Gross profit implications for brands:** - Without a distributor: 50–60% gross profit target - With a distributor: 40–50% gross profit target **Key dynamics members highlighted:** - Wholesalers and RTM teams are typically targeted on average gross profit across their entire book, not individual SKUs—so they'll accept lower margins on some products if the overall basket margin hits target - **On-trade (pubs)**: margins can vary within a single order (e.g., a mixer might carry higher margin while the spirit carries lower), as long as the overall blend works. This can be a useful negotiating angle when pitching new listings - For large contracted business, pricing is negotiated on total GP and multi-year supply agreements, not on a per-unit basis - **Brakes** (and similar major food service distributors): members asked about their specific margin expectations but no concrete answer was provided in this discussion **Caveats:** Members noted that premium/super-premium exceptions exist where margins depend heavily on what you "can get away with." Fighting over per-case margins on commodities (e.g., 25p per case of mixer = £0.01 per serve) is common but often not economically worthwhile.
How can Kindred Collective members use collective purchasing power to negotiate better pricing with logistics and fulfilment providers?
Members identified that pooling volume across the group could create meaningful negotiating leverage. The practical approach is to create a shared visibility tool first, then use that data to approach suppliers collectively. **The tactic:** - Build a shared spreadsheet documenting what each member currently pays logistics and fulfilment providers (base charges, rates, volumes). This reveals pricing patterns and creates a foundation for collective negotiation. - Pool the group's combined volume when approaching suppliers to negotiate better rates. - Members recommended **Bezos** as a logistics/fulfilment option worth evaluating; those interested can request an introduction. - One member volunteered to build and maintain the initial spreadsheet if members populate it with their current provider data and charges. **Status:** This is an emerging initiative with several members expressing commitment ("Count us in", "Sounds like a superb idea") but still in early stages pending spreadsheet creation and population.
What wholesale margins should I expect to offer in the soft drinks industry, and how do they vary by customer type?
Soft drinks wholesaler margins typically range from **10% to 30%**, depending heavily on customer size and negotiating power. - **Large group/national customers**: Expect margins as low as **10–15%** on open-book pricing arrangements. These high-volume buyers have significant leverage. - **Independents and smaller retailers**: List price margins can reach **25–30%**, occasionally higher. - **Mid-range/standard wholesale**: **15–25%** is the typical baseline for general wholesale relationships. - **Partnership/deal-based arrangements**: When working collaboratively on specific deals, margins may compress to **10–15%**. The wide range reflects that wholesalers negotiate individually based on volume commitments and customer tier—there is no fixed industry standard. Larger customers with volume leverage consistently achieve lower margins, while smaller independents pay higher wholesale prices.
What margin expectations should I set for rapid delivery apps like Gorillas?
Members report that margin expectations for rapid delivery platforms vary depending on product category. - **Grocery products**: Rapid delivery apps typically expect to price-match small convenience stores (like Waitrose or Tesco Express), which constrains margins to wholesale-equivalent levels. - **Non-grocery products**: Apps can be "more greedy" with margin demands when competing on non-grocery items, suggesting better negotiating positions outside the grocery category. One member noted they're operating at the same margin rate as their wholesale business when supplying rapid delivery platforms. The key variable is category: if you're in grocery, expect tighter margins aligned with small-store retail pricing; if outside grocery, there may be more room to negotiate higher margins.
What are the costs and pricing tiers for listing products on Brandbank?
Brandbank charges per-item listing fees with tiered pricing options: - **Brandbank Basic tier** — £120 per item - **Brandbank Premium tier** — £275 per item These are recurring costs for each product you list on the platform.
What are current lead times and pricing for bottle decoration services?
Bottle decoration is currently a tight market with significant lead-time and cost pressures. Members have experienced substantial price increases and extended timelines. **Current situation:** - Lead times for new product development (NPD) decoration have extended to **6 months** - **Bruni** quoted a 125% price increase, citing inflation despite the actual inflation rate being 2.9% - Members experienced successive price rises: **4% then 11%** in quick succession **Market context:** - The Yorkshire decoration sector (near Allied and Stoelzle) is experiencing acute labour shortages, with Amazon's local logistics facility offering £18/hour starting wages and drawing workers away - Pallet bottle inserts and protectors face cardboard supply constraints - Decorators currently have significant pricing power in what is described as a "decorators' market" **Recommendation:** Members should expect current negotiations to favour suppliers and plan NPD timelines accordingly—6 months minimum for decoration lead times appears to be the current baseline.
What are current lead times and pricing for custom bottle sourcing from China versus Europe?
Members recently compared China sourcing costs and found them more competitive than historical rates, though quality control remains a consideration. **Pricing and specifications (China FOB):** - **0.42 USD per piece** for a custom 500ml Super Flint spirits bottle (lightweight), quoted for 18,000-piece 40HQ container loads - Packing via pallet with paper dividers **Tooling and setup costs:** - **Sample mold fee: $650 USD** - **Bulk production mold fee: $1,500 USD** - Bottle drawing design: 2–3 working days **Lead times from order:** - Sample mold creation: 3 weeks - Sample marking/proofing: 1 week - Bulk production mold: 3 weeks - Mass production run: 2 weeks **Market context:** Members noted that China pricing has become significantly more attractive recently—historically container tooling could cost $14k, making small runs unviable. Current pricing appears more accessible. However, **the main trade-off flagged is potential quality control issues**, requiring careful vetting of suppliers and thorough sampling before committing to bulk orders.
What software and strategies should we use for managing inventory and pricing, particularly for stock held under excise duty bond?
Members recommend a practical approach to inventory management that balances regulatory compliance with cost-effective tooling. **Inventory software:** - **Xero native inventory system** — members have raised serious concerns about whether the built-in Xero inventory module can properly handle wine and spirits stored under excise duty bond, so validate this thoroughly before relying on it as your sole solution. - **Unleashed** — commonly used by members but flagged as expensive for smaller operations, so evaluate against your budget and complexity needs. **Pricing and margin calculation:** - **thinkMargin app** — recommended as a useful, accessible tool for calculating margin, cost and price conversions; particularly helpful given the distinction between markup (cost-based) and margin (sell-price-based) that retailers typically prioritise. - Retail margins typically run 30% in the spirits and wine sector, though this varies: premium retailers demand larger margins, convenience stores work on smaller margins for faster-moving products, and margin % is generally higher on wine than spirits. Importantly, retailers focus on cash margin (absolute pounds/pence), not just percentage—so a high-value product like Louis XIII may carry lower percentage margin but higher cash margin than lower-priced stock. **Stock management around regulatory changes:** - Pre-buy stock before duty increases or regulatory changes take effect (monitor news for lobbying outcomes, as these can affect timing). - Coordinate with your warehouse team in advance, as many businesses will be doing the same and capacity/timelines will be tight. - Expect wholesalers and big producers to post new price lists on the effective date, with across-the-board increases of a few pounds per bottle likely. **Caveats:** If you hold stock under excise duty bond, standard inventory software may not be fit-for-purpose—test any system thoroughly before committing. Margin calculations depend heavily on your product category and rate of sale, so use thinkMargin or similar tools to model your specific scenario rather than assuming the 30% benchmark applies uniformly.
What gross profit margins should we expect when supplying alcoholic beverages to hotel bars compared to regular bars?
Hotel bars typically operate on different margin structures than traditional bars, though the exact expectation depends on whether you're supplying to an in-room or bar operation. **Margin expectations:** - Regular bars typically work off **65–75% gross profit** on wet sales - Hotel bars are more flexible since beverage sales are often secondary to room revenue, but members suggest aiming for at least **70% GP minimum** if supplying direct - When working backwards from the customer's selling price, assume they'll want around **50% of their retail selling price as GP** **Direct supply considerations:** - If supplying direct to the hotel chain, build in a **wholesale buffer margin** (typically 15% or £5–6 per case) to protect yourself if the hotel later sources through a wholesaler instead. This prevents your pricing being undercut and endangering your listing - Be mindful of the supply chain: chains may transition from direct purchase to wholesaler fulfillment as volumes grow, so structure pricing accordingly **Key caveat:** Members emphasized the importance of protecting your own margins early on to avoid being squeezed if distribution channels change. The exact GP% negotiable depending on volume and whether it's a room-service or in-bar placement.
What margin structure and profitability metrics should a D2C spirits business target, and how do duty, delivery, VAT and advertising costs affect unit economics?
D2C spirits margins are tight once excise duty, delivery and product costs are factored in. Members emphasise that **profitability on first sale is essential**—don't rely on lifetime value given iOS attribution changes. **Cost structure reality:** - Excise duty on 40% ABV spirits: ~£9 per bottle - Delivery: ~£5 per order - Product cost: variable, but leaves little room at £30 net sale price - VAT: applies on top and must be accounted for **Profitability targets:** - **Minimum 50% gross margin** required for D2C to work - **ROAS (Return on Ad Spend) targets:** Members use 5.5× ROAS as a benchmark; pause spend if falling below target - Calculate ROAS across *all* D2C channels (not just Facebook), as Facebook attribution is unreliable post-iOS changes **Strategic options:** - **Bundle duty-heavy spirits with merchandise** (lower-duty items, branded goods) to spread fixed costs and improve blended margins - Use a **ROAS calculator** to model scenarios before scaling ad spend - Be disciplined: pull back on advertising immediately if ROAS drops below your threshold **Caveat:** One member with 100,000+ Shopify orders notes this is learnable, but requires in-house discipline or agency support to execute profitably. Don't assume repeat customers will save unprofitable first sales.
What commission rates do major online drink marketplaces charge, and is there room to negotiate?
Most members report fixed commission structures with limited negotiation potential, particularly at lower volumes. **NOTHS** charges around 25% base commission, with members reporting no success negotiating this rate down. Promotional features push costs significantly higher: members noted that opting into additional promotional activity increases **NOTHS** commission to 35%, which can become loss-making despite increased volumes. **Amazon** typically generates 4–5 times the sales volume compared to specialist retailers and traditional wine merchants, suggesting a tiered approach to marketplace strategy rather than reliance on a single channel. Members emphasise that commission negotiation is largely unsuccessful at smaller volumes, suggesting scale is a prerequisite for better terms.
How should freight and logistics costs be charged to UK wholesalers—built into the price or as a separate line item?
Members build logistics costs into their overall price structure rather than treating them as wholly separate. The typical approach is: - **Integrated pricing**: Incorporate transport and logistics into your price trees so wholesalers see a single, clean unit price. - **MOQ threshold**: Charge shipping as an additional line item only for orders below your minimum order quantity (MOQ). Once a wholesaler hits the MOQ, logistics is absorbed into the negotiated price. This approach simplifies invoicing for regular, larger orders while protecting margin on smaller or trial orders.
How should you approach negotiating direct purchase agreements with major mixer brands for competitive pricing?
Members recommend going directly to mixer brands rather than through standard distributors when you're looking for volume deals. **Fever Tree** offers "partnership" deals where they negotiate pricing in exchange for marketing tie-ins and exclusivity commitments — they'll commit to using their tonic as your primary mixer. The trade-off is that brands use these agreements as marketing opportunities, so expect some marketing obligations in return for the discounted price. For specific negotiations, members suggest leveraging existing connections within the community — reach out to other founders in the Kindred Collective who own mixer brands, as they can often broker introductions or facilitate discussions. Going direct works best for large orders (e.g. trade shows or significant volume commitments) where you have genuine scale to offer the supplier.
What should a small drinks producer with 3 employees expect to pay for accountancy and bookkeeping services?
For a small producer with 3 employees, members suggest a reasonable range of **£700–£1,400 per annum** depending on the full scope of services required. Members also noted that specialist accountants with tiered pricing structures exist within the community network. One member reported working with accountants who offer **different levels of pricing** and have proven effective even for more complex setups (multiple entities, inter-company loans), describing them as "game changers" with "reasonable and great work/outputs." If you're facing a significant price increase from your current bookkeeper, this range provides a useful benchmark to assess whether the new quote is justified by expanded scope or an unreasonable jump.
What margin do specialty retailers typically expect on a 750ml bottle priced at £15?
Standard retail margin expectations for a £15 750ml bottle sit at **15–25%**, according to members with direct experience in specialty retail placement.
How should brands set minimum order quantities (MOQs) when selling to wholesalers?
MOQs should be structured to work commercially for both the brand and the wholesaler. Set a threshold below which orders become unprofitable for you—if a wholesaler orders just two cases, your margin gets squeezed rapidly. **Pricing strategy with MOQ tiers:** - Set a baseline MOQ (e.g. pallet or half-pallet quantities) that makes financial sense - For orders below the MOQ, charge an additional fee to cover your costs and reduced margin - This approach protects profitability while still allowing smaller orders when the customer pays a premium **Delivery considerations:** - Delivered pricing is standard, though some regional or friendly wholesalers may occasionally collect stock themselves (rare bonus) **Key caveat:** Members stressed that MOQs must balance your commercial needs against wholesaler requirements—set them too high and you lose sales; too low and you erode margins on small orders.
What are the real margin impacts of offering free shipping above a threshold on D2C orders?
Free shipping thresholds are now essential for D2C but significantly erode margins post-logistics. One member's detailed analysis found that while they projected 78% of orders would fall below their £50 threshold (and thus incur shipping costs to the customer), the actual figure was 60%—meaning 40% of orders attracted free shipping. This 20-percentage-point miss meant they absorbed full pick, pack, and shipping costs on far more orders than modelled, collapsing website margins to levels comparable with on-trade and off-trade channels. The key lesson: free shipping thresholds are now table-stakes for D2C competitiveness, but members should model conservatively (expect lower conversion to paid shipping than intuition suggests) and stress-test margin impact before committing.