Vit Hit strikes new $20m distribution deal in US market

FAST-GROWING Irish drinks company Vit Hit has signed a major new US distribution deal worth at least $20m (€17.5m) over the next two years. The deal with the New Jersey-based Honickman Group — which distributes Canada Dry — will see Vit Hit sales double from an expected 18 million bottles this year to 36 million next year.

The drink — which is a low-calorie blend of teas, juices, water and vitamins in a range of flavours — has seen sales shoot up as increasingly health-conscious consumers continue to turn away from high-sugar carbonated drinks.

Speaking to this newspaper, Vit Hit’s chief executive and co-owner, Ian O’Rourke, said that by 2019 the company was targeting sales of 60 million bottles, many multiples of the 96,000 bottles it sold when it launched in 2007.

“This deal in the US is a game-changer for us. Honickman has a big reach along the east coast and a lot of sway with the big multiples. We are very confident that once we are on the shelves we will sell,” said O’Rourke.

The new distribution deal serves an area of 25 million people and will see the Irish drink immediately stocked in 5,000 of Honickman’s 15,000 outlets in the Mid-Atlantic region, from New Jersey to northern Virginia. Vit Hit already has deals with a number of smaller independent Pepsi distributors across 12 US states.

Honickman, based in Pennsauken, New Jersey, is one of the US’s largest privately-owned bottlers and distributors of soft drinks, with more than $1bn in annual revenue. Its key brand is Canada Dry but it also distributes Vita Coco, Snapple, Sunkist and 7-Up.

O’Rourke said that Vit Hit aims to have the entire east coast covered within 12 months and then gradually move towards the west coast

“This deal also gives us credibility with the rest of the market and we are discussing another distribution deal in the northeast of the US as a result of this deal,” he said.

The company has been approached by a number of major potential investors, including two major drinks companies.

“Because we are starting to be recognised, we have a lot more people approaching us in terms of funding. We have had approaches from venture capitalists, wealthy individual investors and other drinks companies.

“But we want the right backer. There is no point being wowed by a big name and big money if the soul of the brand creeps away. Our aim is to make this Irish-born drinks company into a global brand,” said O’Rourke.

The brand is now sold in 16 countries and in Ireland it is expected to sell more than nine million bottles this year. Overall turnover is expected to double to about €10m and the new deal is expected to add €20m to that within two to three years.

“If someone asked me 10 years ago would we enter the US market I would have said, ‘not a hope’. But the sugary carbonate market is stagnating in the US and consumers are looking for something different. Vit Hit fits rights into that,” added O’Rourke.