BRAND BUZZ W RITTE N B Y D AV I D S CH U E MAN N
BULK SPIRITS OPPORTUNITIES AND YOUR BRAND
Over the past several years, the availability of bulk spirits has exploded.
W
hile distillers have often turned to bulk spirits, the combination of increased production by both larger rectifiers and craft distillers has resulted in an excess of available product. This ample supply has driven down prices and increased accessibility to high quality bulk spirits. In turn, these factors have spurred opportunities to create marketing-driven brands and private label products.
WHAT ARE BULK SPIRITS? The term “bulk spirits” refers to finished distilled spirits that are available for purchase. Once obtained, they are ready to be bottled and sold immediately or they can be blended or further aged by the owner to put their own signature touch on the final product. This category has grown to include everything from unaged products like vodka and gin to aged whiskies to lesser-known regional spirits from all over the world.
CURRENT MARKET LANDSCAPE The unfortunate realities of the current market have been hitting the craft distilling community. “Consumer purchasing power has been significantly impacted by inflation, rising costs of living, and economic uncertainty. When consumers are financially strained, discretionary spending — such as craft spirits — naturally declines,” according to the Wine & Spirits Wholesalers of America.1 Health concerns and the rise of the “sober-curious” trend have also given consumers reasons to cut back on their alcohol consumption. These factors, and many others, have all contributed to slowing alcohol sales and, in some cases, the closure of distilleries. With the downturn in sales of alcohol, many distilleries find they have produced more product than they could sell and defunct distilleries have inventories that need to be liquidated, both of which have contributed to an excess of supply. 1
https://www.wswa.org/news/wswa-responds-us-craft-distilleries-are-crisis
W W W . ARTISANSPIRITMAG . C O M
BUSINESS OPPORTUNITIES IN BULK SPIRITS — FOR EVERY STAGE IN THE LIFE CYCLE OF YOUR BRAND While the market landscape is challenging, there remain opportunities for those who can utilize this flood of products on the market, no matter the size or tenure of your distillery.
▶ New Distillery: Utilize bulk spirits to rapidly get to market and
generate cash flow to fund the build of your equipment and distillery. There is currently an amazing supply of high-quality whiskey to take advantage of while you build up and age your inventory of in-house products.
▶ No Distillery: Utilize bulk spirits exclusively to set up a market-
ing-driven spirits brand. This path is a huge time and cost saver, allowing you to re-allocate money that would have been spent on a facility and equipment to instead develop your brand packaging, marketing, sales, and distribution. Creating a portfolio sourced from bulk spirits does not mean forgoing creative control. Many distilleries continue to age or blend the spirits — creating entirely unique products that stand out in the market for a fraction of the cost of in-house distilling from the start.
▶ Existing Distillery — Expand Your Portfolio: An existing
brick-and-mortar distillery can take advantage of bulk spirits to expand a portfolio. Use your still and equipment to produce your core offerings and turn to bulk spirits for new products that are outside of your standard spirits, such as limited edition items, lower-priced
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