Stateways

StateWays Jan/Feb 2016

StateWays is the only magazine exclusively covering the control state system within the beverage alcohol industry, with annual updates from liquor control commissions and alcohol control boards and yearly fiscal reporting from control jurisdictions

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15 StateWays ■ www.stateways.com ■ January/February 2016 SCOTCH it has a bit of that Bourbon sweetness. It's considered a 'crossover' Scotch whisky - one that would be appealing to more traditional Bourbon drinkers. Beam Suntory's portfolio includes the Islay Bowmore and the ultra-peaty Laphroaig. Bowmore is introducing a limited-edition Bowmore Mizunara (Japanese wood) Cask Finished Whisky, with an SRP of $1,000. BARRELING ALONG Single malt Scotch is growing at a similar rate to Bourbon and Tennessee whiskey. Malt sales hit 9.2% in 2014, ac- cording to the Distilled Spirits Council (DISCUS), with much of that increase coming from the high-end (9.0%) and super-premium (12.1%). "Everyone is looking for single malts," says Ted Far- rell, president of Haskell's Inc., a wine and spirits retailer based in Minneapolis. "The pull from the shelf is spread out among many SKUs, with no single Scotch dominat- ing—all are moving very well." "Single malts are driving growth of the Scotch category right now," says Raul Gonzalez, Brand Director for the Edrington Group, with The Macallan and Highland Park malts as well as the Famous Grouse and Cutty Sark blends in its portfolio. The messaging for these single malts, Gonzalez says, is that they are small brands, "crafted like a hand-tailored suit." New in 2016 is Macallan's Edition No. 1 (fi rst of an annual series), which is matured in eight different European and American oak cask styles and sizes, LEADING BRANDS OF SCOTCH WHISKY, 2013-2014 (Thousands 9-Liter Cases) '13/'14 Brand Type Supplier 2013 2014 % Change House of Dewar's FB Bacardi USA 1,243 1,186 -4.6% Johnnie Walker Black FB Diageo 940 886 -5.7% Johnnie Walker Red FB Diageo 710 712 0.3% Clan MacGregor USB William Grant & Sons 470 463 -1.5% Buchanan FB Diageo 335 430 28.4% The Glenlivet SM Pernod Ricard USA 387 387 0.0% Chivas Regal FB Pernod Ricard USA 392 358 -8.7% The Macallan SM Edrington Americas 186 209 12.4% Inver House USB Sazerac 197 186 -5.6% Cluny USB Whyte & Mackay Americas 185 181 -2.2% Total Leading Brands 5,045 4,998 -0.9% Others 3,790 3,712 -2.1% Total Scotch Whisky 8,835 8,710 -1.4% FB=Foreign Bottled; USB=U.S. Bottled; SM=Single Malts. bottled at 48% ABV. "We have worked since we opened to create a broad Scotch section with as many selections as we can get our hands on," says Erin Robertie, Liquor Department Man- ager for Hazel's Beverage World in Boulder, CO. That selection has garnered the retailer over 2,000 new Scotch customers. "We have a solid customer base that returns for new releases and 'the next great bottle.'" "Single malts are a small part of the puzzle but a large part of the whisky conversation," says Ewan Morgan, Na- tional Master of Whisky, for Diageo, whose portfolio en- compasses 28 single malt distilleries. Even though Scotch blends make up more than 90% of global sales, he explains, "the single malts get much of the attention, because of the exclusivity, rarity and the higher price point." HIGHER PRICE TAGS One of the factors impacting sales growth of single malts is rising prices, which have far exceeded bumps in other categories. "Scotch prices are skyrocketing," says Broc Smith, owner of Sarasota Liquor Locker in Sarasota, Fla. "Some- times when I replace a bottle on the shelf, the price I pay is as much as what the last bottle sold for. That's tough on retailers." "Demand for Scotch has gone up," observes George Ryals, manager at All Star Wine & Spirits in Latham, N.Y., "but so have the prices. Is that 14-year-old that used to cost

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