LVMH Giving You Some Love

Did I say that big brands were money-hungry vampires sucking the soul out of the whisky industry? Sorry, I forgot about Louis Vuitton Moet Hennessy. I love LVMH. They're always there when we need them. They love making a deal.

Every time one big brand decides to take another price hike on their signature expression, the boys at the Glenmorangie Company are there to exploit that opportunity into their gain. That's what a good company should do: use the missteps of their competitors to create new customers for themselves. I do that every day at K&L. I will spend all day with a customer, explaining every detail of every bottle if that's what they want to do. For every snobby retailer that thinks the newbie customer is beneath them, I will be there to offer a full explanation and answer every question, patiently and willingly.

In the wake of another giant price increase for Macallan 18 year old, the boys at Glenmorangie have been able to offer some serious cushion on their own 18 year (easily the better whisky, anyway). In my opinion, the Glenmorangie 18 year old whisky is one of the greatest values in all of whiskydom. It's supple, soft, textural, exotic, and satisfying to both the beginner and expert alike. It's such a fantastic single malt.

We had this for $89.99 as of yesterday and we couldn't sell enough of it. I could keep this at $89.99 and continue to sell tons of it. But I like to shake things up a bit every now and again. In favor of the consumer, of course. In the wake of this recent Macallan price increase, I'm going to use this opportunity to create some new Glenmorangie superfans. Starting right now the price of the 18 year will be seven dollars less per bottle.

What can you as a dissatisfied whisky fan do to stop price gouging by whisky companies? Stop buying their stuff. Start supporting brands that will support you in return.

What can K&L do as a retailer? We can work harder to lower the price of good whisky on your behalf. We will support you if you help support us.

Glenmorangie 18 Year Old Single Malt Whisky $82.99. Better than Mac 18, in my opinion. $100 less per bottle. K&L is now the lowest price in the country on Wine Searcher.

I'm going to keep doing my part. So is LVMH. Vote with your dollars, people. Money talks.

-David Driscoll


The Whisky Industry Sells Out (like it's supposed to)

Let's see....

We've got the Whisky Advocate Blog talking about the current state of the industry this week with tons of comments from unhappy enthusiasts, lamenting the loss of affordable, quality single malt.

My buddy Tim over at Scotch and Ice Cream has decided he's going to stop buying whisky and drink what he has. There's some good commentary going on there as well.

Of course, the current talk is based off of SKU's article about the possible "Golden Age" of whisky being over. Steve wrote that article a year ago in July, however.

Steve and I were talking about price increases at that time after I wrote an article that June.

Even back in 2010 we were getting some guff from customers because we were changing our prices to reflect the new costs, while other stores will still sitting on older inventory and older pricing. People thought it was just K&L looking to make an extra buck.

There's been plenty of whisky blogging over the past few years about the increasing cost of whisky. I think I went on a month-long rant about it at one point. But this isn't a secret that's now being discovered and it isn't something new. It's been happening steadily for the last five years. Whisky is hot. Whisky is popular. It's all the rage. Now it's getting too popular and people are getting upset. True whisky fans have called it a bubble. Long time drinkers have said that it won't last. Collectors have raged against whisky companies for selling us younger whisky with a higher price tag. Connoisseurs have complained about newbie drinkers buying what they're told is good, thereby making it harder to get things like Pappy Van Winkle.

More and more people are voicing their displeasure as of late, likely because things are only getting more expensive and the values are becoming harder to find. Since the whisky industry is facing absolutely zero competition in terms of upstart distilleries or newly-formed businesses, it can charge whatever the public is willing to pay, which has yet to find a ceiling if you look at the Bonham's auction from a few days ago.

While it makes sense for consumers to complain when prices rise (gas, taxes, etc), should we really blame the whisky companies? If you're in the business of making whisky isn't this scenario exactly what you want to happen? More money for less product? Huge gains? A market that can't get enough with emerging markets on the horizon to increase this demand? Isn't this exactly what you're supposed to do when people want to buy your product? Raise your prices?

To lambast the whisky industry for doing exactly what it's supposed to do (make as much money as possible) seems a bit misguided. Whisky companies are not politicians. We didn't vote them into office. They're not using public money to make their whisky. They didn't issue us any promises about "no new taxes" or "no price increases." Yet, because we feel so passionately about their products we feel like we should have a say in their directions (much like my co-worker Alex feels about the San Francisco Giants).

When Bruichladdich sold to Remy Cointreau we were all pretty bummed, even though nothing has really changed since the sale took place. It was more of a symbolic sadness because it meant that even the best independent distilleries were for sale. It's how A's fans felt when Jason Giambi signed with the Yankees and shaved his beard. It's how hip-hop fans felt when Ice Cube started making movies like "Are We There Yet?" It's how punk rockers felt when their genre became co-opted by middleclass, suburban Americana with three-chord anthems delegated to soda commercials.

Why shouldn't Billie Joe Armstrong become a millionaire, however? Did Green Day ever promise their fans they would never sign lucrative record deals? Did we really expect inner-city youths who for years had used rap music to express their pain and suffering not to cash that ticket towards a better life?

What about your street cred? Doesn't staying true to yourself and your fans have any meaning anymore?!

Not to whiskymakers. Well, maybe a few. Springbank comes to mind. But outside of a handful of proud moralists the answer is a resounding:


Lagavulin isn't a small, proud, family-owned business run by traditional Scotsman using techniques passed down from generation to generation. It's owned by one of the largest, most powerful corporations in the world. Corporations exist to make money! As much of it as possible. As fast as possible. As cheaply as possible with as much profit as possible.

If you don't like Ice Cube's music anymore, do you think he cares? If you post on a message board that Green Day's last good album was Dookie, do you think they're losing sleep? Those guys are sitting on a beach somewhere drinking a cocktail and thinking about how great life is. They're not worrying about what you think.

The same goes for whisky companies. They're all selling out because that's what they're supposed to do - SELL, SELL, SELL. Just like any sellout artist they've got an entirely new legion of fans who never "got into" the old stuff. Fans who have never heard any of Jay Z's early albums. Fans who don't know that Dave Grohl used to be in a band called Nirvana. For every old school fan who loses interest in the updated product they're creating ten new ones to take your place. That's how Bon Jovi continues to fill arenas around the world. He can't sing "Living On A Prayer" anymore, anyway.

Unlike an aging artist, however, who might like to play a small club every now and again to recapture the nostalgia of the old days, whisky companies do not have a conscience. They're not worried about their legacy in the eyes of true connoisseurs. They don't give two shits if customers say, "Man, they don't make 'em like they used to."

They're making money hand over fist right now. Just like they're supposed to.

Why do we expect them to do otherwise?

-David Driscoll



Just a quick note for today. Ardbeg did a private committee tasting of Ardbog today via the internet with Mickey Heads. I was lucky enough to get a sample.

Two words: it's delicious.

They're calling it the "most delicious Ardbeg private committee release ever." I know once this media blitz starts you'll all say to yourself, "yeah, right."

I can vouch, however. The manzanilla sherry influence on this whisky is absolutely delicious. Butterscotch and creme brulee. Lots of peat. 52% so you can drink it straight, but a drop of water is helpful.

Still no word on pricing, but it's coming June 1st. This whisky destroys the Galileo, Ardbeg Day, or Alligator releases. The best Ardbeg I've tasted since my last drop of 1990 Beist.

Stay tuned!

-David Driscoll


End of the Quarter Scramble

As you saw from David OG's depressing post yesterday, we're at the end of another financial quarter here in the booze industry and now is the time of the year when we're notified by the liquor companies about price changes. My box is currently full of emails that say things like:

David, just wanted to let you know that ______ will be taking an increase starting tomorrow. If you want to get the old price I need an order today. Please buy what you think you will need.

Guess what? EVERYTHING is going up in price. Then, as David OG pointed out, you'll send them an order for twenty cases of booze to buy in against that increase and protect your old retail price. However, that's when this email shows up:

David, it looks like we're out of _______ right now. ETA is 5/12. Sorry about that.

So you just sent me an email telling me that if I don't buy more of _______ today then I'll be faced with a price increase starting tomorrow. However, when I try to buy more of _______ from you there isn't any to buy. What we're dealing with here is brands covering their asses.

We told you about the increase. That's all we can do. It's not our fault that you didn't buy more earlier.

Everything from Macallan will be taking price tomorrow. Highland Park too. Fernet Branca is going up in price. I just got word that Louis XIII will be adding an extra $200 to its bottle cost. Basically, we either have to raise our prices or make less money.

And you wonder why we go to Scotland and France in search of different brands to sell?

Again, I'm fine with gradual inflation. It's a necessary part of the economy. However, this is happening four times a year in some cases. Like David said, there comes a point when a store like K&L will simply say "Enough" and start dumping brands. If you don't see your favorite single malt on our shelves it probably has something to do with price increases (Glenrothes, Talisker 18, Old Pulteney, cough, cough).

Part of the reason this is happening is the lack of supply and the huge demand. We all know that so let's not rehash a tired conversation. The other problem, however, is the lack of competition. Where's the motivation for brands to compete? The craft whiskey scene is only offering more expensive bottles of lesser quality. It's only giving brands an excuse to charge you more, rather than fight hard for your business. When brands see $60 for a one year old whiskey their eyes light up and their pulses start racing.

Until any craft distillery can make a 12 year old single malt for less than $50 there's no reason for the big boys to bring prices down. That's not to say that craft distilleries can't make a difference because they can. Competition with white spirits like gin has been fierce. Craft distilleries have totally forced the brands out of K&L. We don't sell Tanqueray anymore. We don't sell Bombay. We don't sell Gordons. Those guys are history and the brands are still scrambling to make up that market share. The same thing goes for tequila. Don Julio who? We don't sell that. Patron? What's that? Craft beer is doing the exact same thing to Budweiser.

Smaller whiskey distilleries, however, are unable to apply the necessary pressure. There's too much overhead and too much advance planning required. By the time any of these craft whiskies are 12 years old many small distillers will have spent so much money that the owners will be begging to sell. Please, Proximo, buy my distillery in Colorado and help me get out from under all this debt. Craft distilleries are popping up all over the place because the time to sell booze is NOW. If we can get this to market fast enough we can strike it rich! How many whiskey-focused craft distilleries do you know of that are biding their time, waiting for the right moment to release something tasty and affordable?

I can think of one. High West. When David Perkins finally releases a mature rye, Bourbon, and single malt I think he'll be ready to offer steady pricing, but that's only because of his incredible blending skills and his access to mature whiskey in the meantime. Not everyone was as early to the party as David, however.

Again, I find parallels to the world of professional wresting. Wrestling's golden era was from 1996 until 2001 - the time when three top-class companies were driving to outdo one another. Two of those three couldn't keep up with the top brand, however, and they were eventually co-opted by the WWE. Now we're right back where we started. For those of you looking forward to another renaissance, a time when all of these craft whiskies are finally mature, I envy you. I don't share that same optimism. I forsee a future of smart brands. Brands that made deals to buyout their competition. Brands that used their power and scale-of-production to squeeze out the little guys. Brands that used the high-prices and questionable quality of craft whiskey to double their own prices and triple their own profits. Brands that got so rich off of the rebirth of whisky drinking that they're now invincible.

Who's gonna stop them?

-David Driscoll


One Day....

One day, no one will drink Macallan. Not because they've lost their touch, not because they've stopped using Golden Promise, not because Michael Jackson is no longer with us to espouse the distillery on the hill, people will always pay attention to it. Simply put, no one will be able to justify spending the money on this stuff. Today I received the price increases for the brand effective May 1st. You may remember that we were forced to raise our price on Macallan 18 year for the first time in quite a while after eating incremental price increase over the last couple of years. Macallan feels perfectly justified to raise their prices simply because of laws of supply and demand. Who can blame them? They've raised their prices once a quarter for as long as I can remember and we still can't keep it in stock. Let's not beat around the bush. Despite seeing no slowdown in sales due to price increases, Macallan is also feeling extreme supply pressure from the Asian market. The number of wealthy individuals in China, Singapore, Japan, Korea, who are willing to pay whatever it takes to own this prestigious product is unfathomable. Regardless of what they charge in Asia, the savvy world traveler will find that the prices in the US are significantly better than back home. That means that unless the prices normalize worldwide, we will not see any sort of reduced demand domestically. In fact, I'm convinced that the vast majority of Macallan 25 and 30 year sold in the US is finding its way in suitcases or through various exporters into Hong Kong, Macau, or any number of other destinations where wealthy individuals are willing to pay tenfold the retail price just to secure a bottle of the famous distillery's rare offerings. But, what does that mean for us? People who might like to actually drink Macallan? It means we're screwed. Today, the price of Macallan 18 year went up $206 a case. That means my cost is above my retail price (again)! Expect Macallan 18 year to be $200 in no time. That's not even the worst of it. The Macallan 30 Year Old Fine Oak, given it has been VERY unavailable over the past year, has just increased $1700 a case or nearly $300 a bottle. This is not even the highly prized Sherry Wood 30 Year. I'd buy in, but of course they're out of stock until after the increase. Big surprise. Take comfort in the fact that the Macallan 25 year is only going up $401 a case. So what was a few years ago an $800 bottle (and an expensive one at that), will easily go for $2000 today if not significantly more. But, can it still be undervalued? How about $2600 in Hong Kong? You can buy it today! So yeah, it's over man. One one will drink Macallan.

-David Othenin-Girard