Pernod Ricard is shaking up its distribution partnerships as it plans to triple its ready-to-drink (RTD) footprint in the U.S. over the next three years.
Following a full-year earnings report last week that showed RTD sales up 7%, the French spirits group announced a transformation of its route-to-market strategy that will support a newly created RTD department.
Pernod Ricard is among other major spirit companies rerouting their distributor partnerships following RNDC’s withdrawal from California this week. The announcement, made in June, has shaken up the distribution landscape and left suppliers scattering to new wholesale partners.
As part of the shift, Pernod Ricard USA has established two new commercial divisions with distributor partnerships tailored to the needs of each. The RTD Division will now partner with Reyes Beverage Group, Crescent Crown and their network partners distributors across seven key states. They join a roster of existing RTD distribution partners – including Southern Glazer’s Wine & Spirits (SGWS) and Republic National Distributing Company (RNDC).
The second division (named the GEM Division) will be tasked with “incubating and scaling the next generation of high-potential brands,” and take a state-by-state distributor approach with new partners such as Crescent Crown and Johnson Brothers/Maverick, while building on existing ties with SGWS, Breakthru, Heidelberg and Martignetti Companies.
The new divisions complement Pernod Ricard USA’s mainline portfolio (the majority of the group’s volume), which continues to be managed by the aforementioned partners as well as Allied Beverage Group, Empire Distributors, Fedway Associates and Georgia/Tennessee Crown Distributing. The shift went into effect on September 1.
“We have an iconic portfolio, and this new strategy allows us to sharpen our focus while partnering with some of the most respected distributors in the industry, aligning on shared goals and unlocking all opportunities for growth,” said Paul Basford, chief commercial officer of Pernod Ricard USA, who joined the company in December 2024.
Accelerating innovation in RTDs and non-alc “to tap into expanding consumer occasions,” has been part of Pernod Ricard’s strategy, according to the company during its earnings presentation. Two more innovations in either of those segments are expected soon, but the company held back details.
In the fiscal year ending June 30, Pernod Ricard reported solid growth across its portfolio of RTDs, which relies on extensions of its major brands including Jameson, Absolut, and most recently, a Dole and Malibu collaboration.
The company, which posted a -3% dip in organic revenue in its FY25, has seen some sales recovery among its flagship brands including Bumbu (+24%), Jameson (+3%), Absolut Vodka (+2%) and Kahlúa liqueur (+7%). Pernod Ricardhas previously stated that Absolut sales in the U.S. were improving, led by the RTD collaboration with Ocean Spray.
Bringing its major brand names into new formats and leveraging recognizable names from across the aisle for RTDs has been a consistent strategy for the French spirits group, as seen with Absolut Vodka and Ocean Spray. The Coca-Cola Co. also partnered with Pernod-Ricard on an Absolut Vodka & Sprite RTD after launching its Jack & Coke RTD partnership with Brown–Forman. A Kahlúa Dunkin’ Caramel Swirl Cream Liqueur this year marked Dunkin’s first entry into the cream liqueur category and will be a permanent addition to Kahlúa’s liqueur line.
Spirits-based RTDs are one of the few bright spots in bev-alc, up 27.6% in sales in the two-week period ending August 9. Despite major spirit and non-alc names aiming to capitalize on their established brand identities, new-to-world entries such as Gallo’s High Noon or Stateside Vodka’s Surfside have been at the forefront of growth.
Pernod Ricard’s competitors have approached the growing category from various angles. Diageo has earned share of the broader RTD segment with its malt extension of Smirnoff, and recently launched the first RTD from Casamigos. Meanwhile, Sazerac boosted its portfolio with the acquisition of BuzzBallz.
Other global spirits companies, including Gallo, William Grant & Sons and Brown-Forman have now followed Sazerac and put their RTD products in the hands of Reyes Beverage Group in California.