While the last article I wrote was devoted to determining the value of a whisky's retail market price, what about the personal value of a single malt to the consumer? Aren't some whiskies just worth the price simply because we like them? NO! Well, maybe sort of. It depends on if you can get them or not. Some people like Pappy 15 so much that they're willing to pay $150 per bottle just to get some of it, but that's an issue of availability. The opposite can also be true. The same person may love Lagavulin 16 so much that they're willing to buy cases of it, but only at the lowest possible retail price. They'll spend hours calling every local store to see who's the cheapest. Because Lagavulin is widely available, there's serious competition on pricing. Because Pappy 15 is not, people try and get as much as possible for each bottle. The availability of a whisky very much determines how much we're willing to pay for it, hence, why companies are switching over to small batch releases. However, what should these whiskies actually cost?
Obviously, the consumer is going to be of the mindset that whisky should cost as little as possible! But, again refering back to the last article, we don't know exactly how much it costs to make each bottle. What we do know is that large production is cheaper, but results in more product to sell. You have to be sure you can sell that much whisky if you choose to crank it out in high volume. Small production is more expensive, but results in a more managable amount of product for smaller companies. For that reason, we can get Glenlivet 12 for $24, but we have to pay $48 for Glendronach. What doesn't play a large role in the world of whisky pricing is quality. For a company to claim that their product is simply tastier, and therefore more expensive, than other similarly-produced whiskies is pretty ballsy. For consumers, however, quality is everything in deciphering a whisky's value.
Why pay double the price for Glendronach 12 instead of Glenlivet 12? It tastes better! It's more textural, it's rich and supple, the flavors are more complex, and the experience is more satisfying - to me. It's more expensive because they're a smaller company than Glenlivet - they make less of it and it therefore costs them more to produce it, export it, distribute it, etc. Shopping for whisky isn't too different from selecting produce at the supermarket - you might pay double for certain products, but they may taste a whole lot better! Ultimately, it's up to the consumer to decide if the extra money it cost to make the whisky is worth spending. It was very expensive for Kilchoman to make their 100% Islay malt, so much so that their 3 year old comes in at $100 a bottle. Some people are outraged by the high price, while others applaud and support the effort gladly. Quality determines the value of the whisky to us, the consumer, regardless of how much it cost the distillery to produce it.
If consumer value in whisky is determined by subjective opinion, then what are the great objective values? Using the formula from my last article, I can give you some examples of what I think are amazingly-priced products. However, one whiskey stands above them all as, to me, the ultimate value in single malt:
- McCarthy's Oregon Single Malt Whiskey $49.99 - Are you kidding me? $50? I've seen craft distilleries charge that much for their white whiskey. Tuthilltown distillery charges this much for a HALF bottle of their one year old Bourbon. Clear Creek distillery buys peated barley from Scotland, ships it over to Portland, makes precious little of a peated malt, and ages it for three years in Oregon oak before bottling. Steve has very little space for aging at the distillery, so the availability is small because he literally can't store more than he has now. Yet, it's still only $50. He hasn't raised the price in years, yet as Steve perfects his craft, the whiskey only continues to get better. The 2011 release was the best I have ever tasted. This whiskey is expensive to make, it's older than most craft releases, it's rare, and it's of high quality. Plus, there's no other American distillery making peated single malt. Still.......$50.
We can argue value 'til the cows come home about what our personal favorite value whiskies are, but so many of these arguments will be based on subjectivity. How many great values are there based on objectivity?