YOUR NEXT MARKET IS…
ABROAD WITH MORE DSPS THAN EVER BEFORE, EXPORTING MAY BE THE BEST NEW MARKET FOR YOUR SPIRITS written by RYAN MALKIN
“Everyone should be going abroad,” says Adam Spiegel, owner and distiller at Sonoma County Distilling Co. After all, you avoid paying federal excise tax and skip the localization issue facing many craft distillers seeking to expand beyond their home markets. There is so much “saturation in other states,” says Spiegel, that “quality may take a back seat to it being made down the block.” Because the US is so competitive, Noah Rothbaum, author of the The Art of American Whiskey and founder of drink trend consultancy Liquor Intelligence, says you may have more success competing abroad. “The demand for American craft spirits abroad has blown up over the past few years,” says Rothbaum. According to DISCUS, spirit exports from the USA grew from 7.3 million proof gallons in 2013 to 10.7 million proof gallons in 2014. Like any new market, the first step is determining who drinks
hailing from New York may hold more prestige abroad than
what you produce. “You have to understand the difference in the
a product from, say, Indiana, Vachon notes. Yet, as it should
market and know why you want to do it,” advises Paul Hletko,
be, it’s about the liquid. If the liquid is superb, price is a less
founder of Few Spirits. DISCUS data is readily available online,
important aspect. However, packaging, he says, is key to your
but it’s no surprise everyone seems to be drinking American
success in the EU. “There is no silver bullet when it comes to
whiskey. The biggest export markets for American whiskey,
packaging, it just has to look amazing,” advises Vachon, who
according to DISCUS data, are Australia, France, Germany,
imports such brands as Balcones, Few, New York Distilling, and
Japan, and the United Kingdom. In the United Kingdom, for
St. George. The good news is there is room for growth for craft
example, “American whiskey is in vogue, along with hamburger
spirits in the EU: craft brands have the potential to increase
and barbecue restaurants,” notes Michael Vachon, head of
sales at least 90% over the next ten years, according to Vachon.
brand development at UK distributor Maverick Drinks. Gin, he
The allure of business trips to Europe or Asia should not
says, is also doing well, though there are a lot of them so yours
dissuade you from forgetting our neighbor to the north. For
had better stand out. Outside the UK, gin does well in warmer
some, it may be right in your backyard like it is for Headframe
climates like Italy and Spain, notes Brian Facquet, distiller at
Spirits. “Draw 500 miles around Butte, Montana and you get
Prohibition Distillery.
Vancouver and Calgary,” says owner John McKee. McKee likes
However, don’t expect success in your backyard to necessarily
shipping to Canada not only because it’s so close to his distillery,
translate into success abroad. In the US, says Vachon, “you can
but also because NAFTA tariffs going across the border to
get away with an OK product with local support but that does not
Canada are dropped so he’s not paying the excise tax or tariffs to
in any way correlate to international success.” Sure, a product
Canada. Canada is “a very serious market” for Headframe Spirits
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