Page 54 - The Summit of the Americas 2021

INSIDER

Otis McAllister: “We are committed to Travel Retail”

Otis McAllister was expecting 2020 to “One of the things we are most proud size and freight rates while accommodating
be another record year for its travel retail divi- of is that many customers and distributors new fulfillment needs.
sion before the COVID-19 pandemic stopped around the world had cash flow problems “It is an extreme challenge for us to
that momentum in its tracks, Otis McAllister when COVID really hit. And we were one navigate currently,” says Panara. “The
Vice President Sales and Operations Marc of the few companies that was never late sheer number of top international brands
Panara tells TMI. The company has steadily on any of our payments, and paid all of our that we represent has lifted some of the
grown to be the pre-eminent regional confec- bills in full. I think because of that there burden for both our customers and Otis to
tionery distributor in North America. have been a lot of opportunities that have build up the critical mass when placing and
“Like everyone, the pandemic caught opened for us,” he said. shipping an order.”
us by surprise and derailed our business Panara notes that they approached the The price of shipping products to
almost overnight. We were coming off challenges from a variety of directions to operators has also gone up during the past
back-to-back years (2018 and 2019) of prepare for recovery with their customers. year, adding another layer of cost to the
record-breaking performance for our divi- “From a customer perspective we total, says Nee. There was also a short-
sion and ended Q1 of 2020 35% ahead of always thought that we are all in this to- age of truckers available to deliver the
2019 figures, which includes the business gether. We did what we could from a com- temperature-controlled confectionery,
shutting down effectively in mid-March.” pany perspective and a brand perspective to pushing trucking rates higher.
With booming sales, Otis McAllister support our retailers and more importantly “We have seen increases to some of
could never have anticipated the impact the work with them on a game plan of recovery our most frequent delivered locations more
pandemic would have on its business, says and building a solid plan. A road map we than double,” says Nee.
Panara. can all follow in terms of cutting down the
“Never take anything for granted. In assortment and focusing on best sellers, New spirits division
mid-February of 2020, we were experienc- making sure we have the right promotional Otis McAllister expanded into the
ing record setting growth through the first calendars for each store.” spirits business exactly a year ago with the
month and a half of the year and we were Both Panara and Nee emphasize that asset purchase of Chase International, Inc.
about to bring on the spirits business as of Otis McAllister remains optimistic about The company still sees spirits as an impor-
March 1st. We said, ‘There isn’t anything the future of the travel retail channel. tant part of its future.
that can slow us down.’ Well, we ended “From both a companywide and divi- “We are thrilled to have entered the
up eating those words in a big way, but no sion standpoint we are committed to Travel spirits business back in March of 2020
one could have predicted the impact that Retail. We have been very fortunate that we although the timing was certainly not ideal.
COVID-19 would have on our industry let have the backing of a strong parent com- We represent several fantastic suppli-
alone around the world.” pany which believes in our vision for the ers who all focus on or cater to different
Even as COVID-19 hit its business future of the Travel Retail division. As we customer needs with the array of offerings
hard, Otis McAllister maintained close have been, we will adapt our business to in their respective portfolios,” says Panara.
contact and communication with both its cater to the current conditions and continue Even with a solid portion of its spirits busi-
customers and suppliers. The idea was to to be nimble to make changes accordingly. ness devoted to cruise ships, which have
shape a recovery plan from an assortment We will remain an extension of our brand been at a standstill, he is optimistic with the
and promotional perspective coming out of partners in the stores and work closely with potential of the category.
COVID, says Justin Nee, Vice President of our customers to accommodate their ever- “The goal of the spirits division is for
Sales & Marketing Confectionery Products, changing needs. We are looking forward Otis McAllister to eventually be looked
at Otis McAllister. to the continuous rollout of the vaccine, upon as the go to spirits supplier for U.S.
“Although it has been a challenging people being able to travel more freely Duty Free in which we are providing a win-
twelve months, we are seeing opportuni- again and getting back into the market dow to the world of our brands to interna-
ties present themselves that may have not where we thrive,” says Panara. tional travelers from around the globe. We
otherwise been open to us at this point are still learning the business and of course
pre-COVID. This includes the potential Logistics and Trucking Costs with COVID it has affected the volumes
supply of our brands to new customers and With airport shops closed and product and assortments for the time being, but
territories, as well as the representation of sitting on shelf un-sold, the confectionery we will continue to work together with
new brands that we do not currently repre- specialists had to deal with the logistical our partners and ensure we have the right
sent,” says Nee. issue of products with sell-by dates. As offering to the right nationalities traveling
“If anything our partnerships with our customers were still figuring out their ideal through the airports. We do expect and feel
suppliers have gotten better,” added Panara, stock on hand needs and more cognizant of that we can grow the business to be a much
explaining how the company did all it product dating, the company had to find a more significant portion of our overall busi-
could to maintain its business obligations. way to maintain a balance between order ness than it is today.”

The Virtual Summit of the Americas Issue April 2021 54