Kollaras: The Evolution
By Deborah Jackson
Since the 1960s the Kollaras business has had many faces; from its beginnings as a humble fruit shop it has evolved into a successful family-operated brand building company. In the September issue of National Liquor News (NLN), Deborah Jackson caught up with Michael and John Kollaras to hear about the company’s evolution.
NLN: Talk us through the evolution of the Kollaras business since the 1960s:
MICHAEL: This will be a hard one to answer in a few sentences. My father founded the business in 1960 through the acquisition of a fruit shop in Wollongong. From there it evolved into more of a wholesale type operation through the supply of merchant ships and the like at Port Kembla Steelworks, which really took off for him.
My brother Tass joined the business in the early 70s and me soon after that, with Tass and me focusing on the import, export and wholesale of produce and frozen food. Through the 70s and 80s that business became significant and our footprint around the world expanded and we created a platform in international markets that is still largely in place in our beverage business today. During the late 80s and early 90s we began investing in other businesses, particularly with property and car dealerships becoming extensions of our group at the time.
By the mid-90s liquor became a focus through ownership of bottle shops and supplying many customers in our produce business with alcoholic beverages. In the late 90s the Howard Government reformed competition law to allow for parallel imports of alcohol and this created an opportunity for our retail liquor business to expand into wholesale. Our parallel import business accelerated on the back of cruise ship supply, because many operators were entering Australia but encountering pricing structures which were vastly different from those in other parts of the world. Over time, this formed the basis of the business we have today with a domestic, export and duty free arm in beverages, but today our focus in the domestic market in particular, is on our own brand portfolio on the back of our partnership with ALM formed in 2015. We continue to operate the broader group of companies with investments and other trading businesses such as our Tobacco Imports Company being a focus for us.
NLN: With a third generation of Kollaras’ stepping into management roles, are they bringing with them any new ideas or business strategies?
MICHAEL: The third generation has been a material part of our evolution, but the change has also come from the next generation of people at all levels in our business. Recognising the power of generational change allows family businesses to continue to be relevant and at the forefront of what they do, and that is very much the basis for how we have transitioned.
John Kollaras leads our business in the capacity of Managing Director and is surrounded by an outstanding group of executives and people who are driving our growth. John has been in the business for some time and has balanced a very different approach and environment with an alignment to the second generation, to ensure our business continues to be great at what it does. This has challenged the family to shift our traditional way of operating, and the results speak for themselves.
More recently, Georgia Kollaras, my daughter, has stepped into the role of Marketing Manager and is behind many of the outstanding initiatives seen in the trade, particularly on our brands, helping us in our transition from box mover to brand owner. My son Jonathon, the youngest in our family, has also joined the business in our operations team and is now working through his development in a sales role.
NLN: In recent years, Kollaras has taken a new strategic direction and achieved great success as brand builders. Can you talk me through why you decided to change the direction of the company?
JOHN: Like many businesses large and small, evolution and change takes time and careful planning – but what takes more time is getting the message out there about what you’re doing. I say this because our change in direction has been more of an evolution that we have worked towards for an extended period of time. Our business has always been focused on creating long term value, this is what has kept us going for nearly 60 years. So while the direction hasn’t really changed, we remain focused on delivering outcomes and solutions that our customers want. In the past, this was about having a competitive offer on commercial brands at a price. Now, that is still a part of what we do but we look to create value by developing brands with a unique value chain proposition for all of our customers and deliver superior service through a market leading business model – both domestically and internationally.
NLN: How difficult has it been to shake the label of ‘parallel importers’ and become recognised as brand builders?
JOHN: We are an organisation that is constantly evolving. As part of that, we have deliberately shifted into a space where we are focused on our brands. In the domestic market, this is delivered through our wholesale partners at ALM.
Our strategic solution driven approach in our export and duty free businesses is also where we have great relationships with many other brand owners.
‘Shaking the label of parallel imports’ suggest it is a dirty word, and we look back at our wholesale business and parallel sourcing arm and believe it was an excellent business model, which delivered what it had to at the time. Shifting away from parallel, has been a deliberate move enabled by a shift in the market and the way that all players have changed their models.
What I can say is our results, awards, accolades and partnerships with many suppliers speak for themselves. They not only show a shift from the focus on parallel imports in many parts of our business, but also a recognition that Kollaras is very different to what it was in the past, however our skills and capabilities which have been built over our entire history and three generations. That’s a combination that continues to deliver excellent value.
NLN: Is parallel importing still a large part of the business?
JOHN: We do operate parallel sourcing for our business where we cannot source stock here or require a different sourcing model to service customer and partner requirements. This is typical of many businesses who are not only brand owners, but end customer suppliers like us.
NLN: What have been the major highlights for each of you during your careers at Kollaras?
JOHN: Having the opportunity to create a platform for generational transition and change in a family business has been an exciting challenge for me since I joined. In recent years, our advisory board and second generation have supported my leadership team and me in driving significant changes to our business model which has been challenging, engaging and rewarding.
MICHAEL: Obviously as a family business, both Tass and I have loved the way our children have not only embraced the business, but also the fundamental values we have tried to instill. Watching the business evolve, and the people within it (who we credit for its success), is and will always remain a major highlight for us. To see people who have been with us for 10, 20 and 30 years or more and have started from grass roots to now become leaders and managers is something we are and will always remain very proud of.