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Wednesday
Nov242010

Price Increases - Whose Fault Is It?

I've been hitting the message boards lately, reading rather than posting, and it's really fascinating to hear how other people in other states feel about the booze business.  I was informed by one of my customers that a thread had been started on another bourbon site about my earlier Van Winkle post and in reading that discussion I noticed some talk about retailers jacking up the price of this year's release.  While we didn't gouge our customers by taking the scarcity of the bottles into consideration, we did raise the price on the bourbons this year by a few bucks.  Was that because we were being greedy?  No, it's because we had to pay more for them this year than we did last year - the wholesale price went up.  And everyone got less than last year because there were fewer bottles produced, so if you're a tiny retailer and you only got two bottles at a higher cost, you're probably going to try and make whatever you can.  Not that I approve of such measures, but I get relatively more than just about any other small retailer so I'm not forced to make that decision.

Today the first drop of the 2010 Diageo Classic Malt collection comes in and the prices on some of these whiskies are going to surprise people.  I'm sure there's still a store somewhere in the U.S. that has a few bottles of last year's Lagavulin 12 and it's selling for around $75.  When someone Google searches that bottle now, we're going to pop up at the top with a price of around $100.  That person is going to look at that comparison and say, "K&L is jacking up their prices!" Not true.  The Lagavulin 12, for whatever reason, is far more expensive this year.  As I've said in previous posts, whisky prices change on a monthly, if not weekly, basis.  Maybe Diageo bottled less than before or maybe it has become rarer.  In any case, it's pricier than before and we didn't have anything to do with that.

-David Driscoll

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