How to make the most of the world’s distillery of business knowledge and experience

Nigel Mills

Good advice is priceless according to Nigel Mills (BA Economics, 1980, County).

After a career building up a chain of 77 convenience stores and supermarkets, he is now CEO at the rising star of the luxury whisky market, The Lakes Distillery in Cumbria. Tapping into the best pools of experience and expertise has kept on bringing results.

“If we didn’t know anything, we’d find someone and employ them. In 2014 we met with Dr Alan Rutherford, the world-leading expert in Scottish whisky. He liked what he saw, and so we went back to him and brought him in as our chairman,” said Nigel.

“After two years of whisky spirit production we wanted to focus on quality. Dhavall Gandhi had originally been at Ernst & Young but left to follow his passion for whisky, going on to work at Heineken and then as whisky-maker at Macallan. As a new distillery, we shared the same vision to create a global luxury whisky and to put his name as Master Blender to a very special whisky. The result of this, the first single malt from Lakes Distillery, is due to be released later in 2019.”

The first important advice came from his father.

“I wanted to be a professional golfer originally, but when the family business was sold my father said I needed to get O levels, A levels and a degree and become an accountant. My golf wasn’t that great at that stage anyway!

“I came to Lancaster through Clearing. It was one of the new, up and coming red brick universities at the time. The management school had a good reputation even then, and there was a well-rounded mix of subjects - I was going to learn about the law, economics, the business environment and the essentials of accountancy.

“There was much more than just the academic side to Lancaster. I joined the golf team and we got to play at some of the world’s most famous golf courses; at St Andrew’s, Port Rush in Ireland, the Royal Liverpool, as well as the chance to get access to their clubhouses. I also remember vividly all the discos on the pier at Morecambe in winter. Somehow we survived.”

Nigel had always “wanted to make some money”, and followed the classic route in the 1970s of washing cars and collecting ‘money-back’ glass bottles. But at 16 he was also in a position to buy his first investment property - a £15,000 house at a time when interest rates were around 17% - making use of connections and trust formed by his family and their years in business.

“I’d always wanted to start my own business. But you need to know exactly what you want to do and have some substantial financial support - I didn’t have either. So I joined Pricewaterhouse to get experience, to get skills, and most importantly of all, to make contacts.”

With a solid basis of experience as a chartered accountant, Nigel came upon an opportunity in 1986 to buy a newsagents business from a family friend - mortgaging his investment properties to raise the necessary cash. Over the next 25 years, the Mills Group brand grew into an £80m turnover operation with 2,200 staff and outlets stretching from North Tyneside to Sunderland, County Durham, Cumbria, Lincolnshire, Yorkshire, the Midlands and South Wales.

“My father was the crucial difference in being able to grow the business. As someone who’d been in the newsagent area, he acted as my mentor, and it was his reputation that meant access to suppliers, getting credit and having a degree of credibility from day one. Quality of board members and Non-Executive Directors might seem intangible but it’s really important.

“We also had to be adaptable. We had to undergo three transformations in response to the market conditions. De-regulation of newspaper distribution meant we lost our monopoly in local areas and around 40% of our turnover. The change to Sunday trading laws. And the competition from the ‘express’ stores set up by supermarkets. In the case of the first two we were able to re-invent ourselves as providing news and services. We benefited hugely from the arrival of the National Lottery in 1994 and also started offering in-store post offices, off licences and mobile phone top-up cards.”

Mills was voted the best independent convenience store chain in 2008 and was the largest of its kind in 2010 when the time had come to sell stores to Tesco for its one-stop convenience store model.

Nigel’s next venture came about from spotting news of planning permission being granted to Paul Currie - a whisky entrepreneur who’d previously set up the Arran Whisky Distillery - for a whisky distillery close to the site of a hotel in Cockermouth he’d owned since being at the Mills Group plc.

“There was a clear opportunity for synergies between the Lake District hotel, tourism and the distillery, and being able to pull in multiple revenue streams. I had experience in hotels, retail, leisure, food and beverages, internet retailing. I didn’t know the whisky business or anything about exports, so could draw on Paul’s experience.”

The Lakes Distillery opened up in December 2014 with 65 employees, but mostly relying on visiting tourists and sales of gin and vodka.

“For a spirit to be a whisky it needs to be three years in a cask as a minimum, and much longer for ageing, so we had a delay before real revenue came in. We had to fund huge initial costs and see ourselves through the early years.

“It was tough to be looking to raise £4 million and be told that an English whisky wasn’t going to work. When you have 30 years’ experience in business, that kind of rejection is hard to swallow. We eventually managed to raise £12 million through the Government’s Enterprise Investment Fund. The ace up our sleeve, though, has always been the Lake District. There’s 19 million visitors every year and we attract around 100,000 to the distillery - already making it the most popular in the UK.”

In 2018, the Lakes Distillery was named as one of eight whisky distilleries in the world ‘to visit before you die’ (alongside Glenfiddich and Bushmills) and also broke the world record for whisky from a new distillery when one bottle sold for £7,900 at auction. The business is now targeting AIM stock listing by 2020.

“Once you’ve left school there’s a feeling that putting your hand up to ask a question makes you look stupid. But there aren’t really any stupid questions, just stupid answers,” argues Nigel.

“We all need to keep asking questions and find mentors. Having a successful business is about keeping on going when you believe in what you’re doing. But also learn to walk around brick walls rather than keeping on running into them, do something else - because no-one has a god-given right to always be right about their business and their ideas.”

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