Taking ownership

Taking ownership

With the whisky industry becoming increasing part of large global corporations we decided to look at\rhow ownership is viewed by the drinkers. We put two questions to Whisky Magazine's online community at www.whiskymag.com. The first looked at whether the size of the company influenced a whisky's flavour,availability and price;and whether the nationality of that company had any influence on the whisky

People | 20 Jul 2007 | Issue 65 | By Rob Allanson

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BA Bruce D Allen,Massachusetts,USA
NB Nick Brown,Isle of Lewis,UK
KG Kenneth Graham, Perthshire,UK
SH Adrian Phelan,Galway,Ireland 1. Does the size of the company that owns your favourite whisky influence its flavour, availability and price?AP: I would have to say yes of course it does. One of my favourite drams is owned by a large drinks corporation and even though we sometimes bemoan the fact that they appear more interested in numbers rather than the whisky, it is only because of the size of the company that the product is readily available world wide.Further because of larger economies of scale this enables them to produce a good product at a lower price than say a small independent distillery.In relation to well established distilleries the flavour profile is generally fairly stable.However changes seem more noticeable with medium to small distilleries which have seen their sales go through the roof and they are finding it hard to meet demand.This manifests itself in situations where once there may have been older malts in a standard 10 Years Old (any where from 10 to 17 Years Old) but high demand has reduced that to a possibility that only 10 to 12 Years Old malts being used now. A case of a victim of one’s own success but we should not overly worry about these scenarios as these whiskies are still of a high standard and people soon appreciate what they have instead of mourning what is perceived to be lost.BA: This is an interesting question, as there increasingly seems to be a two-tiered system in the Scotch whisky world, at least. As the last round of multinational buy-ups has occurred, there has been a boom in what might be called boutique distilling. Whether it’s start-ups like Kilchoman, or older established plants being bought out by independent owners, like Bruichladdich and Bladnoch, it’s a trend that can’t be ignored. The emphasis is on single malts, and we who appreciate malts certainly want to support such businesses. But it’s a niche market, and a tenuous business at best; whether these operations will all survive in the long run will depend on their collective ability to solidify their niche.Does it affect the way the whisky tastes?The proof is in the pudding, of course, and I don’t know anyone who refuses to buy good whisky just because it comes from Diageo (for example). But even the big guys are taking cues from the mavericks, as more and more unchillfiltered, uncolored, cask strength, and single-barrel bottlings are being produced. The answer is a qualified yes. It behoves us, the consumers, to care as much as possible about those who are in the business because they love whisky, not because they expect to make big money. Of course, the small producers intend to make a profit, and the many people who work in Diageo (and other companies’) plants love whisky, too; but it seems obvious to me where the best response to the desires of the consumer lies, and if we want the industry as a whole to be responsive to us, we need to see to it that the trendsetters are successful.The future taste of our whisky, at least, is at stake.NB: I’m not sure the size of company makes a difference to the whisky produced, but larger companies probably have more options for what to do with the whisky - whether to swap it, blend it, mature it or sell as a single malt. Smaller companies seem to have to sell a lot as single malts, at least when they first start up. Perhaps this forces them into a route of adding flavouring from wine or other spirits - calling it cask finishing, of course - because they can’t tip their lower quality stuff into blends. But the basic options in terms of ingredients, mashing, fermenting and cask selection and maturing should be the same for most producers, regardless of size. They can decide whether to go down an economy brand route or a high quality route as they please.KG: I think it has to, particularly in the single malt whisky market. The higher producing distilleries have more spirit to mix and match when it comes to bottling standard expressions. It stands to reason that the less spirit you have available, the greater the possibility in fluctuation in flavour, no matter how skilful the alchemy of the blender. I would guess that this might not necessarily affect blended whisky to the same degree as there will have a greater variety of stock to work worth and from more than one distillery.The bigger the distillery, the more it can produce thereby increasing availability to the consumer. It stands to reason that they will also be able sell standard expressions cheaper, no doubt redressing the balance with the upper end of the market and special releases.2 .Does the nationality of the company that owns your favourite whisky influence its flavour, availability and price? Japanese companies owning Scotch or American whiskies;American companies owning Scotch whiskies; Scotch whisky companies owning American whiskies?AP: In short, no, not negatively anyway.I would hate to think that a new owner would try to influence the flavour profile in a whisky from a distillery that they have just taken over. However, I pretty much doubt that this ever actually happens. A company can be taken over for many reasons but obvious ones are a) it has a good product and the new owner sees it as a good investment and/or entry into that market, or b) they can give it a bigger market profile thus creating a good investment for themselves.In relation to availability and price it may well have an affect. For instance if a Japanese company takes over a Scottish distillery it would probably be an aim of the company to make the product available in Japan if it is not so already. Further if the company is big enough it may have a development plan to expand to new markets and therefore improve availability.Conversely some distilleries have a great product but a very low profile and the owners (whether existing or new) may decide to repackage and remarket as a higher premium product than before. It is in this scenario that the price may well be increased but such increases are usually marketing decisions and have very little to do with the nationality of the owners.BA: I would of course like to see Scottish distilleries in Scottish hands, or British, at least, but the particular ownership of a large mulitnational drinks company is not important to me, for the most part. Such companies in any case will always have great advantages in marketing, distribution, and pricing flexibility.KG: It shouldn’t really affect the flavour unless there is a direct policy to change the nature of the product.In some instances this may be a good thing in reviving the fortunes of ailing distilleries. I suppose it really depends on where the company sees its greatest returns coming from. If, for example, BRIC (Brazil, Russia, India and China) nations preferred a different flavour, it is conceivable that the profile of the product may alter so as to tap into a potentially huge market. After all, that is the origin of blended scotch, breaking into a lucrative market with a more subtly flavoured product.As to the question of price and availability, it follows that with greater investment from global companies there could be an increase in production along with potential to sell at a more attractive (not necessarily competitive) price.
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