StarStock is an online marketplace for the drinks industry, offering a simple, secure and convenient solution for businesses wanting to trade drink products on the Internet. Sam Ulph, Managing Director of StarStock, spoke to Wholesale Manager.
WM – Sam, what was the overall aim for setting up StarStock?
Our aim was to build a portal specifically for the industry to provide pricing transparency and connect buyers and sellers, therefore widening the trading opportunities and delivering longterm growth, and from there become the global go-to marketplace for trading drinks online.
WM – First of all, Sam, who is allowed to sell beer and cider online on Starstock?
Only registered businesses can trade through StarStock. We follow all HMRC guidelines including the recently launched legislation AWRS to ensure only credible and legitimate businesses trade through our system.
WM – How do you check their credibility and legitimacy as suppliers?
We have a rigorous due diligence process for suppliers, involving on-line checks with both official and private sources, as well as collecting full due diligence info packs from our suppliers.
In the future we will be pushing for an automated call-up system so we can check AWRS registrations on a daily basis.
WM – What trends are you seeing in sales of beers and ciders traded through StarStock?
Clearly the drinks industry is driven by seasonal variation, so cider time is coming up now and like many we have seen this go from strength to strength over the summer months. This is especially true as taste profiles have changed and the key cider players introduce fruit cider variations. As regards beer, the move towards craft at its higher price point continues to drive profitability and margin through every stage of the supply chain from licensed venues and wholesalers all the way back to the suppliers. An area we will see grow over the next few years, I have no doubt.
WM – Do you have any figures for the value of beer and cider traded on StarStock?
The current split between beer and cider on StarStock is 50/50, with Peroni leading the charge on beer and Kopparberg flavours on cider.
WM – What proportion is this of the overall value of drinks traded through you? Is this proportion growing?
Both categories currently equate to about 40% of value and yes, this is up circa 270% from last year.
WM – Do you sell low alcohol/alcohol free beers? What trends are you seeing with these?
Yes we sell them, although it’s not an area we get much traffic or in fact focus on.
WM – What time of year is best for online sales of fruit ciders?
The peak time is spring and summer.
We have just seen the launch on our platform of new J2O ranges and the new flavour variants of Kopparberg.
WM – What time of year do you start listing summer beers?
We list beers all year round. Corona, Sol and Desperado sell continually, but the volume starts to come through at the end of March.
WM – Similarly, what time of year do you start listing winter beers?
I’m not sure we have any specific winter beers on our site, but it would be good if anyone out there wants to target this segment with us.
WM – How are you responding to the boom in microbrewery products?
We have had many listings from microbreweries and as I mentioned before, clearly this is a positive move for the industry. We hope to work more closely with microbreweries this year, to add variety to our current range of products.
WM – How big a category for you are regional ciders?
They’re not massive at the moment, but like microbreweries our system enables any business, not matter how big or small, to reach new customers. So we welcome all manufacturers and suppliers to our trading portal.
WM – Do you actively contact beer and cider suppliers whose products you think should be listed on StarStock but currently are not?
To date, we have spent very little on marketing, as we wanted to ensure we refined our offering before taking it to the press. Therefore, we have built our current business on three key pillars, price, security and distribution/customer service. This in turn has helped us grow a large database of customers in a short period of time and referrals have been at the heart of that. Needless to say our sales team is always out looking for new suppliers to come on board.
WM – How will the Alcohol Wholesalers Registration Scheme affect your business?
We expect the effect to be extremely positive. We have been very open about our communication of AWRS and have already been recognised by the industry as a leader in this area. We really feel we have cemented ourselves as leaders in transparency and legitimacy in what was in the past a murky old world of dodgy traders. Our buyers will continue to trade with us, as they have no doubt that the stock is coming from a good sources and this in turn, we expect, will only increase as buying numbers as our business grows.
This will be especially, when HMRC start to send out approval (URN) numbers after the end of March 2016 registration deadline.