When innovation is a topic for discussion, Dynshaw Italia can’t resist mentioning Cobra Beer—or, to be more specific, “the big bottle.”
It was Cobra, of course, that first opted to forgo the UK’s standard 500–550 ml beer bottles and introduce an ever more generously proportioned 650 ml vessel.
“Cobra was all about doing things differently and better and, as a result, changing the marketplace,” explains Italia, who recalls that Cobra’s big bottle strategic insight had to do with the willingness of UK diners to share their oversize beverage with others at their table.Read More
“Because they were sharing the bottle, it would be kept on the table. As a result, customers entering the restaurant would see all these tables having a bottle of Cobra, and it was like free advertising,” continues Italia, who served as group CFO for the popular UK beer brand from 2003 to 2010 as it continued to flummox its beer rivals by touting the brew’s premium recipe while outsourcing the actual brewing and distribution processes.
“Cobra was about creating a premium brand with high gross margins that would eventually fit inside a larger brewery portfolio—one that had their own production and own distribution,” notes Italia, who credits Cobra’s culture of innovation with having routinely led him to explore creative ways to generate working capital.
“I learned that every single asset on your balance sheet could create and generate cash for working capital, whether it was stock or debt—you could even get financing against your rent deposit,” remarks Italia, whose working capital resourcefulness proved to be a good match for Cobra’s entrepreneurial founders.
In the end, Cobra’s appetite for growth (and escalating debt) led its founders to seek deeper pockets, so in 2011 Cobra Beer Partnership Limited was formed as a joint venture with Molson Coors—which allowed the Cobra brand to achieve a “fit” inside a larger brewery’s portfolio. –Jack Sweeney
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CFOTL: Tell us about Soldo … what are its offerings?
Italia: We create e-wallets for customers. They can actually put money into these e-wallets, so they have cash that they can control. Then, we create departments and individuals, whereby each of these departments and individuals can be allocated physical or virtual cards. Then what you can do is actually set up daily, weekly, or monthly budgets for each of the users of the card, or on the card itself, or even a maximum to spend per card.Read More
You can set up granular spending controls, and this is where it becomes really interesting. For any physical or virtual card that you have, you can allow or disallow online payments. You can switch off contactless payments. You can allow or disallow ATM use. You can actually control which geographical locations a card can be used in. You can have a card that can be used only for a single transaction. You can control expense categories of the card so that you can, say, switch off the card so that it doesn’t work for gambling, it can be used only for fuel payments, or it can be used only for digital marketing, for example. So, if you try to use the card outside these rules, it will be declined and instantly the relevant person will be informed of the unauthorized use.
One of the things about COVID that we are able to see—because we’re in the business of looking at spenders—is what is happening. Where are people spending money? What are the areas of spend that are going down? We saw instantly the drop in travel across regions because we see things firsthand: People are just not spending on hotels, they’re not spending on flights, they’re not spending in this sector.
But when we looked at other categories, we saw increases, and this gave us good insight as to what was happening during COVID time. Then we started to see which areas of the businesses were starting to come back—probably before anybody else—because we see that on an aggregated basis. So, that was really useful.
Value Quote: “In a fast-growing business, there’s always continuous change. The key to managing this change is culture. In all of the businesses that I have worked for, all of which were entrepreneurial, I have found that the culture of the organization has been linked very closely to the personalities of the leaders.” jb
Soldo | www.soldo.com | HQ: London, UK