Propelling Heineken to the top
World of Heineken 41 winter 2009
Paradise Beverages acquired the right to distribute the Heineken
brand in 1996. The previous distributor had been purchased by
a Heineken competitor. Seeing the opportunity, Mike Shibuya,
President of Paradise Beverages and John McLaughlin, then
General Manager of Heineken USA's Western Region created a
fund to support the Heineken brand via sponsorships, special
events, and promotional activity. Their approach has been pivotal
to a great partnership and Heineken® has grown strongly since
Paradise Beverages took over distribution in Hawaii.
Before Paradise Beverages took responsiblity for distributing
Heineken in Hawaii, Heineken USA was selling around 360,000
cases of the brand. Paradise Beverages' strategy was to build the
Heineken brand through engaging with Hawaiian culture, sporting
events and music.
The company also decided to focus on promoting the 12-pack and
communication with consumers over the next few years centred
on this packaging. "As a result, Heineken® 12-packs are the top
beer packaging throughout Hawaii," says Mike Shibuya. "In fact, the
package propelled the volume through the roof. The first year saw
a two per cent increase, followed by a seven per cent increase, and
then seven straight years of double-digit increases. We estimate
that the portfolio will achieve 2.4 million cases this year," he says.
The increasing popularity of Heineken® in Hawaii can partly be
attributed to the many events and sponsorships with which it has
been associated. These include the Makaha Bash, a traditional
Hawaiian music festival, the Sheraton Hawaii Bowl American
Football event, the Diamond Head Classic basketball tournament,
the University of Hawaii Athletics programme, the Sony Open golf
tournament, and the Na Hoku Hanohano Music Awards.
Paradise Beverages is quite an unusual business in that it is
structured almost like a family, says David Lokar, Heineken Brand
Manager for Paradise Beverages from 1996 through 2001, and
currently the Area Sales Manager for Heineken USA. "Everyone
knows each other's families. Mike is extremely demanding at work,
yet very thoughtful and caring away from it. He will often get
personally involved in helping employees during times of hardship,
for instance. This unusual mix of solid business sense combined
with a caring attitude is well respected in the industry."
David adds that Mike's ability to open doors that were previously
closed has also been crucial to the success of the business, and has
made Paradise Beverages a household name throughout the state
of Hawaii.
Hawaii consists of eight major islands, of which seven are inhabited.
Paradise Beverages has warehouses strategically placed
throughout the islands, which service more than 2,000 accounts.
The largest warehouse is located on Oahu, the third-largest island
and home to around 75 per cent of Hawaii's population, where
Paradise Beverages does the bulk of its Heineken® business. Other
warehouses are located on the islands of Maui and Kauai, while
there are two on Hawaii - known to locals as the 'Big Island'.
"The geography allows us very little room for error in terms
of delivery," says David. "Paradise Beverages managers check
inventory and supply each morning. Their president, Mike Shibuya
personally checks stocks first thing every morning. If a brand is
out of stock, he takes steps personally to ensure it doesn't happen
again."
At Paradise Beverages, supplying Hawaii with Heineken® and other
brands is not so much a matter of logistics as a way of life. "I'd
say that the key to their success - and ours with it, of course - is
extreme attention to detailDavid says. "We keep a close watch
on everything: shipping schedules, unplanned orders, supplier
shortages, delivery challenges on the ground, and so on. Attention
to detail is what keeps it all working so well."
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