March 23rd, 2011

The lines between established distillers and small craft distillers are becoming blurred

John Hansell

And they will continue becoming even more blurred in the future.

As the young, developing craft distilling movement matures and begins offering longer-aged whiskeys, they will compete with the established distillers’ products.

On the flip side, the established distillers are increasingly offering younger, and as is the case with Heaven Hill’s “TryBox Series” (shown in the picture), sometimes even unaged product for sale. In fact, distillers on both sides of the pond are selling unaged spirit.

Craft distillers comprise a rapidly growing, but still relatively low-production, market. I don’t think the large, established distillers have anything to worry about–yet. But they would be foolish to not pay attention.

Just take a look at the American craft beer market and you will see where craft distilling is heading. According to a recent Brewers Association press release, overall beer consumption is down, but the craft beer market continues to grow and capture market share.

The large brewers who made relatively bland pilsner-style beer are now making beer with more flavor–or forming alliances with craft brewers to compete with them.

You are witnessing the same happening within the whiskey industry. Small craft distillers like Stranahan’s and Anchor have been purchased by larger players in the drinks industry. And large distiller William Grant (owners of Glenfiddich and Balvenie) bought the Hudson whiskey brand from Tuthilltown Spirits, the Hudson Valley craft distiller.

Yes indeed, the lines between established distillers and small craft distillers will continue becoming more and more blurred in the future. For the most part, I think this is a good thing. It will be healthy for the whisky industry.

Will there be some downside? Sure! We will have to endure the “weeding out”  of the inferior brands and “fly by night” companies that will undoubtedly surface to make a fast buck in this growth market (as we witnessed in the early phases of craft brewing–and that cigar boom a while back).

But the upside is far greater–and well worth any temporary inconvenience.

Category: American whiskey,Bourbon,Microdistilleries,New Releases,Opinions,Rye whiskey Tags: , , , , 28 Comments

September 25th, 2010

This is just the beginning of craft distiller buyouts. Count on it!

John Hansell

I have so much rattling around in my brain right now, I’m putting up this bonus weekend post before my evil twin takes over on Monday.

This past year we saw the Anchor Distilling Co. sold to the Griffin Group. Then we also  saw Tuthilltown Spirits “Hudson Whiskey” brand sold to William Grant.

This is just the beginning. Count on it!

Make a list of the most reputable craft distillers (both here and abroad) who are putting out a clean product with strong business models, and I willing to bet that most all, if not all, have been approached by larger companies who want to buy them. In fact, I feel quite certain that there will be more announcements of alliances between craft distillers and larger companies in the future.

Why? Craft distillers need the money. They want to make a quality product, but they are also faced with mounting bills and need to put out something to pay off these bills. That’s why you’re seeing a lot of young whiskeys put out on the market–many of them too young!

An infusion of capital will allow them to invest in quality equipment, storage facilities, and barrels. They will be able to hire distillers (and consultants) who know what they’re doing. Moreover, it will allow them to age their product longer so it is fully matured before being put on the market. They will be able to increase production. Plus, the right buyer will get their product into distribution channels, increasing circulation–and sales!

It all makes sense. It’s going to happen. Again and again.

Care to take a guess at who you think will be next?

Category: Microdistilleries,Opinions Tags: , , , 18 Comments

April 27th, 2010

Anchor Brewery (and Distillery) sold!

John Hansell

This is the big news of the day here in the U.S. I’m seeing several news sources reporting it right now, but here’s one from Inc. Magazine. Give it a read.

What does the selling of a brewery have to do with whiskey? For starters, Anchor also makes whiskey (Old Potrero). In fact, Anchor, and its leader Fritz Maytag, pioneered the craft distilling movement here in the U.S., similar to how they lead the craft beer movement a couple decades ago.

The other connection to whiskey is the company buying Anchor: The Griffin Group. A couple years ago they purchased a major position in Preiss Imports. Preiss Imports bring into the U.S. Springbank, Duncan Taylor, BenRiach, GlenDronach, as well as distributing the Hirsch line of American whiskeys.

I’m not sure what all the synergisms are yet, but I am sure they will all play out in due time.

Category: American whiskey,Beer,Breaking news,Microdistilleries Tags: 38 Comments

March 26th, 2009

Yep, we screw up too!

John Hansell

Long term readers of Malt Advocate know that we always try to be fair and balanced in our writing. Sometimes even we fail to live up to our own standards. This happened with our cover story in our last issue on craft distilling here in the U.S. We didn’t include the Anchor Distillery, makers of Old Potrero, the first of a now-growing number of craft whiskey distillers. How could we do something that silly?
 
Well, the intent of the piece was to introduce our readers to the new craft distillers making whisky this past decade. For reasons too long to explain here, we actually ended up including some of the veteran craft distillers, but completely forgot Anchor, and the pioneering influence they had on craft distilling (not to mention the great whiskey they continue to make.)
 
We are not trying to make excuses for ourselves, but sometimes something a whiskey (or person or distillery) is so obvious to us because we are exposed to it all the time, we just (innocently) take it for granted. That’s what happened here and we apologize to Anchor, to Fritz Maytag and his staff for this. It was never our intention to keep them out of the story.

We’re not perfect. We make mistakes too. But when we do, we try to do our best to correct it.

Category: Malt Advocate Mag,Microdistilleries,Opinions Tags: 10 Comments



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