Kinahan's Irish Whiskey
ABOUT KINAHAN'S IRISH WHISKEY
Kinahan’s Irish Whiskey is a heritage brand dating from the 18th century, but its approach to the business of spirits is thoroughly modern. A partnership with invoice financing specialist Accelerated Payments has allowed Kinahan’s to double the number of global distributors it works with and helped it stay on track to weather the challenges of the pandemic.THEIR CHALLENGE
Kinahan’s Irish Whiskey is celebrating the 240th year of the brand, one which has been sampled by kings, queens and heads of state over generations. When current owner Zak Oganian assumed leadership of the brand in 2014, he looked for a financing partner who could provide liquidity to help meet the unique needs of the spirits business: Kinahan’s customers include not just the bar and hotel trade but also retailers and importers in 25 countries.“If you dig deep, the fact that 60 to 90 days credit is standard in our industry is easy to understand, because of what our customers face on their end: for example, our Russian partners first must pay duties to the state before they pay us, and it takes 60 days for a shipment that leaves here to reach our customers in China – by the time they move the product into their own bar and retail customers, six months can be gone,” Zak explains. “We knew we wanted an invoicing finance partner, and only Accelerated Payments offered everything: fees at the right level, no hidden costs, and exceptional flexibility.”
THE SOLUTION
- Kinahan’s selects which customer invoices to finance via Accelerated Payments – an alternative to the ‘blanket’ approach of other providers
- Up to 80% of the value of each outgoing invoice is immediately available as working capital. Accelerated Payments provides Kinahan’s the final balance payments when clients settle the invoices
- Accelerated Payments is a partner for growth – its services have helped Kinahan’s double its number of global distributors
PARTNERING FOR GLOBAL GROWTH OF THE BRAND
Kinahan’s is unique in its approach to its business. It is a cultural brand, with innovations like hybrid casks made of a mix of selected timbers, alongside a tree replanting program and patronage of artists, tactics that help it stand out in its market. These strategic brand activities have contributed to the company’s overall growth, but its current leadership emphasises that flexibility from Accelerated Payments has also been instrumental to its expansion.“Most other companies looking to offer us this facility have higher fees and they also want a blanket approach, financing every invoice; that’s not right for us, and in fact no company should accept that all-or-nothing approach,” Zak says. “APL let us choose who to finance, they’re personal – I know three people by name in there – and they’re flexible: I’ve never had a question for them and have them come back and say ‘No, our policy is X.” Kinahan’s product also appreciates at least 25% per annum in value, but is a long-term investment; access to finance from APL allows him to invest in his business by essentially borrowing against the value of his long-term asset at a lower interest rate than a standard loan.
Zak notes that his business has weathered Covid challenges well: they were already a dispersed team working remotely, and pivoted easily to focus more on their retail business. Coming up to Christmas, he says that having APL as a financing partner is key to meet peak seasonal demand. “With Accelerated Payments we can produce more, faster – every Christmas we see bigger product volumes, and every penny matters. Since we took over the Kinahan’s brand, we have doubled production and revenue each year, we’ve doubled our headcount, and we’re serving twice the number of global distributors.”
Looking ahead, he’s confident that high quality spirits like Kinahan’s will continue to weather the uncertainty of 2020. “Our industry is looking very positive. People will always need to eat, drink and be entertained, and research shows they want to drink less, but better. Rather than three drinks of something mediocre, people prefer a single glass of something exceptional. That plays to our strengths.”
BENEFITS FOR KINAHAN'S AT A GLANCE
- Gives the company a way to leverage the value of its appreciating asset – whiskey – to access cost-effective invoice finance
- It receives a more personal service and a more flexible financial utility than is available from a bank
- Provides working capital to let Kinahan’s meet seasonal demand and the credit needs of global customers
“With Accelerated Payments we can produce more, faster – every Christmas we see bigger product volumes, and every penny matters. Since we took over the Kinahan’s brand, we have doubled production and revenue each year, we’ve doubled our headcount, and we’re serving twice the number of global distributors.”