The founders of UK vape distributors Phoenix 2 Retail have appointed one of the leading figures in the country’s grocery sector as the firm’s CEO to help drive its shareholders’ vision of the future.
Chris Kelly, who founded the firm with his wife, Rachael, six years ago, has stepped aside from the Hartlepool-based firm’s top job and brought in Steve Mosey to support and lead the management team. Phoenix 2 Retail has enjoyed a meteoric rise under Chris’s leadership, growing from a small office start-up into a business that now employs 80 people across three sites and generates a turnover of £200m. The company first made its name by spotting a gap in the market for a supplier that could bring independent vape brands to major retailers, putting them directly into the hands of supermarket and convenience store customers.
Today, it supplies more than 50 million vapes each year to household names including Booker, Morrisons and One Stop, and has pioneered a range of initiatives covering compliance, product testing, recycling, and new retail solutions.
Steve Mosey, Phoenix 2 Retail CEO, discusses his goals for the new role and the trends that are driving category growth.
Steve, congratulations on the new role. Can you tell us where you have worked before and in what roles?
I have worked at a senior level in retail, most recently as Business Unit Director for Drinks and previously Senior Category Director Beer Wine and Spirits at Asda, and prior to that category director Café, Food To Go and Bakery at Morrisons
I have worked at a senior level across the full range of the FMCG sector, including Heineken, Scottish and Newcastle and Sara Lee.
What are your goals for what you want to achieve in the role?
I want to help Chris and the rest of the board take Phoenix onto the next level while making sure we lose none of the ability, innovation and customer responsiveness that has made us successful to date.
My focus will be primarily internal, by putting processes, systems and accountabilities into place so that the business continues to grow in an exciting but sustainable way.
I want us to continue to find more ways to add value for our customers, by which I mean both the brands who use us and the customers we sell to.
Can you tell us a little of the history of Phoenix 2 Retail?
Phoenix 2 Retail was founded in 2020 in Hartlepool by Chris Kelly and his wife, Rachel, who spotted a gap in the market for a specialist distributor that could bring independent and overseas vaping brands straight into major retailers.
This ambition was fuelled by a simple belief in the need to make products which enabled people to switch from smoking cigarettes more accessible, helping them to live more healthy lives.
Together they built the company in a very short space of time into a firm which now supplies vapes and other smoking alternative products to major retailers, including Morrisons, Booker and Sainsbury’s.
How much is the vaping category worth and is the category set to grow in the next couple of years?
The vaping category is worth around £3.24 billion, which is an incredible landmark for such a young industry, and it is expected to grow by a further 7.6% between now and 2030.
Phoenix 2 Retail was set up to serve adults who smoke cigarettes but want to switch to less-harmful alternatives for lifestyle reasons. Smoking-related disease remains the world’s leading cause of preventable death representing the single greatest public health opportunity of our time, and harm-reduction products such as vaping play a critical role in delivering this public health benefit.
As a result, it represents a very resilient section of the market.
What trends are driving the growth of the category?
I’ve not worked in a category where the trends change so fast – it really is quite breathtaking – and right now the moves are very much into the big puff devices, because they provide great value for customer.
But change is never far from around the corner in this sector. Next year, the Government will levy duty on vaping liquid and that could dramatically change customer habits, so we need to stay alert.
What is the mission statement of Phoenix 2 Retail?
We want to become the leading independent supplier of smoking alternative products in the UK.
What sets Phoenix 2 Retail apart from the competition?
A lot of it is down to the entrepreneurial culture that Chris created, which means we’re very customer-focused and view industry challenges as opportunities, which has in the past resulted in us overcoming setbacks by taking the lead on issues such as compliance and sustainability.
And we don’t have our own product, so we’re brand agnostic. This means we can offer objective advice on the latest products and trends and uphold our brand values by positioning ourselves as a standard-bearer within the industry.
Tell us about Vape Local’s B2B Trade App. What are some of the benefits of the app?
It is one of a number of trade apps which are there to support our wholesale parters, combining technology, innovation and retailer support, which are key focuses of our business.
The app simplifies ordering, inventory management and account administration and gives customers access to an extensive range of vaping products and nicotine pouches with the convenience of mobile-friendly ordering and same-day dispatch for fast restocking.
This means they can react to changing trends extremely quickly, while the apps are tailored to regulatory compliance, which means retailers can maintain legal and operational standards as well.
What different services does Phoenix 2 Retail offer?
Our core offering is B2B supply and distribution, providing access to a wide range of products including e-liquids, devices, and nicotine pouches, along with trade accounts, stock management and logistics support. We also supply in-store fixtures and gantries to help retailers professionally display their vape categories and drive sales.
We also provide vending machine solutions for automated, age-gated 24/7 sales, as well as compliance services to ensure products meet UK regulations through pre- and post-market testing. We also support retailers with age-verification tools, youth-access management and training to maintain legal compliance and we run recycling programmes to help dispose of vapes responsibly.
How does Phoenix 2 Retail’s Pre 2 Post-Market compliance testing programme support and maintain standards across the vape FMCG market?
Our compliance testing programme ensures that all vaping products meet UK regulatory standards before they reach shelves and continue to comply once in the market, verifying product safety, labelling, nicotine levels and ingredient accuracy.
Quite simply, if a product was supplied by Phoenix 2 Retail, then it’s compliant and safe, a guarantee which gives retailers confidence that they are stocking high-quality products.
This gives customers peace of mind and also sets a consistent benchmark that other suppliers and retailers can follow.
This in turn builds trust in the category, protects the reputation of retailers and supports a sustainable, responsible industry ecosystem.
How does Phoenix 2 Retail manage age-verification compliance and protect against underage access in the FMCG sector?
We take youth access very seriously and are developing some exciting technology to improve the industry standards further.
We also instruct independent age gating agencies to audit our customers and offer full support to retailers when needed, helping them to implement robust procedures that meet UK legal requirements.
We also offer training, awareness and mystery shopping services to monitor compliance and identify potential gaps in retailer practices.
There will always be rogue operators, but by combining digital controls, staff education and ongoing auditing, we make sure our retailers maintain strict adherence to age restrictions, minimise the risk of underage sales and reinforce responsible retailing practices across the vaping FMCG market.
What does Phoenix 2 Retail do to ensure the recycling and sustainability of vapes?
Recycling and sustainability is a core commitment to our ESG objectives and we make retail solutions to help retailers manage disposable and single-use vape products responsibly, such as in-store collection points and recycling units for used devices.
These ensure that plastics, batteries, and other components are disposed of safely rather than entering general waste streams.
We also provide retailers with guidance and tools to comply with environmental regulations.
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