The rating of 35 largest alcohol producers in Ukraine: about money earned against all odds

The rating of the largest alcohol companies made by Landlord magazine is an experiment. We observed what happened to a once stable and rapidly growing market, which got a series of powerful strokes for the last two years. We were focused not only on money but on the defense mechanisms developed by the key players on the market during these years.

Some cases deserve not only the description in the rating or a magazine article, but some chapters in anti-crisis management textbook. While making up the rating we did not invent special formulas. We just ranged the companies according to their revenue in 2014 (we did not have more recent data at the moment the rating was made).

The results of 2015 are going to be even more frustrating for some companies. There are some reasons for this. In 2014 the companies’ revenue was affected mostly by the loss of the markets and the companies’ facilities due to Crimea annexation and the war in the East of Ukraine, whereas in 2015 and 2016 the tax pressure will be the main factor of influence. Last summer there was another excise increase. The officials of the industry consider it to be a necessary step due to the local currency devaluation, though the manufactures feel no relief in the situation. The beer market expert Igor Tovkach gives the following numbers: for 10 months of 2015 the production of beer has been shortened by 20.6%, vodka by 16.7%. Compared to pre-crises 2008, the industry production fell by 40%. And it is just the beginning.

The government does not plan to stop. The next excise increase is following. It will be doubled for beer and increased by 50% for vodka.

Alcohol companies do not panic. They are successfully searching for the new marketing channels for their products and make the products range wider. For instance, the leader of the rating, alcohol holding “Global Spirits” put China and Thailand on their sales map in 2014. “Bayadera” company in 2015 introduced to the market their own trademarks of rum and gin, which can become a good alternative for more expensive imported products. Number three in the rating, the brewing company “Obolon” previously selling around 10% of their products to Russia changed their direction towards China.

In 2015 “Shabo” company started the export of its products to the USA. The first national winemaking holding plans to enter the markets of Vietnam, Singapore, Hong Kong and to increase the sales in China and Germany. If they are lucky enough, this decision will save their business. Last year the market was shocked by the proposal to increase the license tax for wine production by five times up to UAH 2.5 million.

The companies producing authorial wine were the least lucky. They have much smaller production volumes and revenues than the holdings, which produce wine in much bigger scales. They have two variants: to pay for the license equally with big manufacturers, giving away nearly everything they earn or to devise other ways around for selling their products. In Ukraine only 40 big companies can afford making and bottling their own wine, while in France and Italy the number of small wineries is counted by tens of thousands. “In those countries everyone who owns a vineyard has a right to make and bottle the wine”, says Ivan Plachkov, the owner of “Kolonist” plant.

In this Landlord issue we tried to highlight all the peculiarities, issues and development aspects of the Ukrainian market of alcohol. Besides the rating, in this issue of the magazine you will find current analytics and infographics. You can also read some interesting stories about Ukrainian wine-makers. We hope that in a year, working at the next rating of the largest alcohol manufactures we will have the articles about grows and success but not about failure and decline. Considering the tendencies the hope is very little.

№ 1 Global Spirits
№ 2 Bayadera

№ 3 Obolon

№ 4 Carlsberg Ukraine

№ 5 SUN InBev Ukraine

№ 6 Nemiroff
№ 7 Eastern Beverage Trading Ukraine
№ 8 Efes Ukraine
№ 9 New Products
№ 10 Olymp
№ 11 First Private Brewery
№ 12 Shabo
№ 13 First National Winemaking Holding
№ 14 Alef-Vinal
№ 15 Alcohol division of the holding company Petrus
№ 16 Scientific Production Enterprise Niva
№ 17 Lvov Distillery
№ 18 Artemovsk Winery
№ 19 Kiev Factory of Sparkling Wines
№ 20 Uzhgorod Cognac Distillery
№ 21 Odessawinprom
№ 22 Poltavpivo
№ 23 Zhytomyr Distillery
№ 24 Tsuryupinskoe
№ 25 Cotnar
№ 26 Gorobina
№ 27 Galicia Distillery
№ 28 Mykulynetskyj Brovar
№ 29 Kotovsk Winery
№ 30 Umanpivo
№ 31 Berdychiv Brewery
№ 32 Riven LTD
№ 33 Odessa Sparkling Wine Factory
№ 34 Chernigov Vodka
№ 35 Absolute Standard

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