In March this year, UK-headquartered Diageo
was among a number of spirits firms to suspend sales in Russia in response to
the war in Ukraine.
A Diageo spokesperson said: “Following our
decision in March, to stop shipping and selling our products in Russia, we have
now taken the difficult decision to responsibly wind down our business
operations in the market.
“We expect this process to take approximately
six months, during which time our focus will remain on supporting our employees
in the region and providing them with enhanced redundancy terms, while ensuring
we comply with local regulations.”
In Diageo’s 2021 fiscal year results, net
sales in Eastern Europe increased by 6%, mainly driven by ‘strong growth’ in
Russia, and partially offset by decreased sales in Lebanon.
Brown-Forman, Pernod Ricard, and Edrington
have all suspended sales in Russia.
A number of companies have made donations
to support Ukrainian relief efforts, including Nemiroff, Bacardi, and Emporia
Brands.
Russian vodka was hit with a 35% additional
tariff in the UK, after the government imposed the extra import tax on hundreds
of Russian products worth more than £900m (US$1.2m) in March.
The Spirits Business looked at the impact
the war in Ukraine could have on Russian vodka, with alternative brands coming
to the forefront.