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cutty sark

The Famous GrouseThe Edrington Group is one of Scotland’s success stories. The whisky company’s latest results confirmed that with turnover up by 18.2% from £468.3m last year to £553.4m now. Its profits too are up from £118.6m to £141.5m today, a rise of over 19%. The figures show that both the dividend and shareholders’ earnings have risen as well. But who actually benefits?

Edrington’s shares are not listed on the stock market. They’re owned by The Robertson Trust which ensures the firm’s independence. This private ownership has allowed the business to develop a consistent, longer-term approach to brand building and investment. It doesn’t take investment decisions based on the demands of City analysts and brokers.

When it took the strategic decision to sell Tamdhu single malt on Speyside to rival Ian MacLeod Distillers for an “eight-figure sum” (a deal completed a few days ago), it wasn’t flashed up on dealing-room screens across the country. This was the second distillery sold to the same firm with Glengoyne changing hands in 2003. Tamdhu had been mothballed since last year and the new owner plans to re-open it with the creation of ten jobs.

At the same time, Edrington’s acquired a brand – Cutty Sark. This is now mainly an export blend, popular in southern Europe and the USA. Right from the start, the new acquisition was profitable in its key markets. This means that there will be additional investment in the brand this year, targeting new markets around the world with new packaging.

Then there was the decision three years ago to take a major share of Brugal, a rum producer based in the Dominican Republic. The Caribbean firm has over 80% of its local market and is one of the largest international golden rum brands in the world. It’s also the fastest growing rum brand in Europe from its international sales and marketing base in Spain.

The significant factor about this partnership was the similarity in ownership and ethos. They have a common approach to corporate social responsibility. The Brugal Foundation and The Robertson Trust both use the companies’ profits to make substantial charitable donations in their own countries, in both cases done quietly and privately.

In Scotland, the Group is best known for a number of key brands – The Famous Grouse, The Macallan and Highland Park. In the latest results, all three have contributed to the company’s growth in key markets around the world. Highland Park in particular has the accolade of being “the best whisky in the world”, an award given by Whisky Magazine Founder and Publisher, Damian Riley-Smith and Park Avenue Liquor Shop Vice President, Jonathan Goldstein.

But the group insists that its strategy involves the long term development of all its brands. The Caledonian Mercury recently looked at the growing number of new blends under the “Grouse” banner. However, the company argues that such brand initiatives are “focussed strongly on the consumer and sustained with programmes that innovate within our categories”.

Chairman Sir Ian Good stresses that “our size and independence allow us to act in ways that other companies cannot. In every aspect of what we do, we can use innovative and different ways of solving problems – or gaining a competitive advantage.”

One of the keys to its success is control of the “route to market”. As part of this, the firm created a joint venture with Beam Global Spirits, a distribution company called Maxxium. Earlier this year, they took control of distribution in China and Hong Kong giving them control through much of South East Asia through one office in Shanghai.

This same approach has been adopted throughout Northern and Central Europe where it manages distribution operations in Sweden, Norway, Finland, Denmark, Germany, Switzerland and Austria from a major office in Stockholm. The Group is also currently in the process of opening a regional office in New York to support brand growth in America.

All this reinforced the company’s reputation as an international business headquartered in Scotland. It now employs over 2,300 worldwide, with over 60 per cent located overseas.

According to Ian Curle, the Group’s chief executive, the company is continuing “…to make good progress and we have further improved Edrington’s strategic position and business performance during 2010/11. Our strong financial performance was supported by brand growth, increased earnings and improved cash flow. “

He stressed that the brand growth in particular had “been driven by increased investment and improved economic conditions in many of our markets. We have continued to invest behind our premium brands despite the difficult trading conditions in mature markets in recent years. This investment is now paying off as we see stability returning to many western markets.”

The Group expects the current trend to continue through a consistent investment strategy. It intends to invest in its premium spirits portfolio. It policy is also to invest in and develop the various routes to market, increasing the number where it has full ownership. And it fully intends to continue investing in people, pointing out that its acquisitions and marketing strategies have “increased the talent available to Edrington and provides us with an opportunity to future growth.”

Robert Louis Stevenson, 1850–1894 <em>Picture: Ana Quiroga</em>

Robert Louis Stevenson, 1850–1894 Picture: Ana Quiroga

Come the spring, what more could a television audience ask for than to sit down midweek and ogle the BBC’s new costume drama? The Crimson Petal and the White, adapted from the book by Scottish-based author Michel Faber, details the trials and tribulations of a Victorian prostitute known as Sugar.

As is almost always the case in 19th century depictions of prostitution, the novel is set in London, a place that appears to have – at least in literature – exclusivity when it comes to bordellos and whores. Even Robert Louis Stevenson set his novel Strange Case of Dr Jekyll and Mr Hyde in London, as if to confirm that vice could never stalk the presbyterian streets of Scotland.

Yet scratch beneath the surface and you can find houses of ill-repute, streetwalkers and harlots out and about and soliciting for business in Aberdeen, Dundee, Glasgow and Edinburgh from pretty much around the time that man appears. Stevenson himself frequented the most sordid of brothels whilst he was meant to be studying law at Edinburgh University, and it can’t be too much of a stretch to suggest his inspiration for Hyde was born in those dingy backrooms off the Royal Mile.

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Surprisingly little has been written about prostitution in Scotland, but what small glimpses there are reveal that it has always been an entrenched problem. In the 17th century there was an acknowledged need for a new jail, eventually built on Regent’s Road in Edinburgh, to imprison the ever-growing criminal population. The 1829 book Modern Athens reveals that Edinburgh had “become, as it were, the common receptacle for the strolling poor, lazy beggars, idle vagrants and common prostitutes”.

In Glasgow, right up to the 19th century and beyond, the Fair holidays, with their street tables and penny theatres, led to an abundance of cheap entertainment, too much alcohol and – inevitably – prostitution. The Fair, which had begun as a religious festival in the 15th century, was by then “reduced to a day or two celebrated in blind drunkenness”.

During the plays, young women cavorted in cutty-sarks, in their own inimitable version of Tam o’ Shanter. Another theatre-owner was even less subtle, using a prostitute to perform “unspeakable acts” as a way of drawing the crowds. A newspaper at the time suggested that there were upwards of 200 brothels in the East End of Glasgow.

According to the modern historian Judith Walkowitz, a British city would have on average one prostitute per 36 inhabitants. This eventually led across the United Kingdom to an outcry for something to be done to stop this “Great Social Evil”. By the middle of the 19th century, the UK government was compelled to introduce the Contagious Diseases Acts 1866–1869 to address the problem of the spread of venereal diseases. At that time, it was thought that one in three men in the British Army needed treatment for VD.

Glasgow opted not to enforce this Act, having decided to tackle the problem earlier. There, the Glasgow Police Act of 1843 had improved things enormously with Alexander McCall, the city’s chief constable, writing that before the Act “you could scarcely walk any distance without some woman putting herself in your way or getting hold of you”.

After the passing of the Act, McCall concluded that “you will not find a city in which there is less of that upon the public streets, or less temptation in a general way to lead young people astray than you find in Glasgow.”

His claims are given greater credence when you investigate the records from Glasgow’s Lock Hospital, an asylum set up to specialise in the treatment of gonorrhea and syphilis, where the number of women treated for VD decreased over the years after the introduction of the Act.

Meanwhile in Edinburgh, William Tait – whose 1840 book Magdalenism offered an in-depth study of prostitution in the capital city – estimated that £200,000 a year was spent on prostitution, and that there were at least 800 prostitutes at work in the city. He traced them to a number of different establishments, from: “Genteel houses of assignation” (of which there were three), licensed taverns (ten), ginger-beer shops (25) and brothels – which he rated from Genteel, second-rate, through to very low.

An illustrative example in Tait’s time of how the trade followed the customer is offered from 1839, when the Earl of Eglinton produced a massive mediaeval re-enactment event in Ayrshire. Over half the prostitutes in Edinburgh were said to have travelled west, many staying for months, and putting a great strain on the brothels they left behind.

It was not just in the bigger cities that the vice held its grip. In Dundee during the 19th century the dramatic rise in VD was said to mirror the increase in street- and brothel-run prostitution. At that time, prostitution was thought to be gravitating to the housing schemes on the outskirts of the city. In the Police Superintendent’s Annual Report from 1876, we see that 123 prostitutes were arrested for “loitering and importuning”.

Through the 19th century, there grew a greater understanding of the need to offer help as well as punishment for prostitutes. The Contagious Diseases Act did necessitate the examination of all known prostitutes, but was seen by a growing number of civil rights activists as an invasion of privacy. By the 20th century, there were numerous attempts to deal with the issue – with Edinburgh, for example, opting for a number of years for a tolerated red-light area.

Today it is estimated that globally the annual revenue generated by prostitution is over $100 billion. With such enormous sums, it is unlikely that this “festering sore on the body of society” (the Scotsman, 1959) will be dealt with any time soon.

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