The Bourbon boom is leveling off and that begs the question about the future of the new distilleries being built. Distilleries like the Potter Jane Distillery and all of the new artisan distilleries being built. There is a lot of money being invested in these new distilleries and the question is “Will they make money and survive?” I say that depends upon the quality of the whiskey they are going to make.
Let’s start by looking at the Potter Jane Distillery. They are investing a lot of money in building this distillery, but I think it is a sound investment. Denny Potter is an excellent distiller Jane Bowie is an excellent blender. They will make excellent whiskey. I also like the fact that they are paying attention to Bourbon tourism and working a tour into the design of their distillery. I also like the fact that they are looking into warehouse design and building smaller warehouses with traditional barrel racks. They believe the smaller warehouses will give them a better range of flavor profiles for their whiskeys. It will take a few years to get their whiskey on the market, but they have already started contract distilling whiskey. This will cut the time needed to get good, aged whiskey in the market. However, with whiskey sales leveling off, they will face tough competition for shelf space in the liquor stores and ultimately, for bottle sales. However, with their name recognition and the quality of the whiskey they will be selling, they should do fine.
So what about the artisan distillers? They need to make their top priority making good whiskey. The distilleries being built with the main goal of making a lot of money by selling out their brands and distilleries to the big companies are in trouble and I don’t expect that will continue. The big companies have plenty of brands already and don’t need to increase their portfolio or production. Next, the artisan distilleries need to make Bourbon tourism an important part of their business plan. Tours are an excellent way to get your product in front of consumers. However, this product needs to be good whiskey because it is easy to sell one bottle to a customer, but it is important that the whiskey is good enough that the consumer will buy a second bottle when the first is empty.
Bourbon sales are leveling off, but there is still a lot of Bourbon (and Rye) whiskey being sold. Competition will be tough, but those making good whiskey will survive. Those that don’t, will not. It is as simple as that. I suspect that it will be harder to start a new distillery in the future as the competition for sales gets tighter. The established distilleries will still get the lion’s share of the bottle sales, and small artisan distilleries will still sell bottles. It will be an interesting time for distilleries for the next few years.
Photos Courtesy of Rosemary Miller