Foley's Epic Wines & Spirits Adds Upscale Division

FILED NOVEMBER 9, 2015

In light of recent consumer trade-up trends, Epic Wines & Spirits, the distributorship owned by Foley Family Wines' proprietor Bill Foley, has established a new division for the company's high-end wine and spirits brands. Named Black Knight Fine Wines & Spirits, the division will be led by Justin Sternberg as executive vp of the division and include a team of certified sommeliers, industry specialists and educators.

The division will begin operations January 1, 2016, and its current list of 100+ proposed brands includes the likes of Scheid Estate, Darioush, Schug, several of the Foley Family Wines brands, Greenbar Collective's spirits, Muirheads and BroVo Spirits.

"This is a very exciting time of growth for Epic Wines & Spirits," Bill Foley says. "As we continue to add to our portfolio, it is imperative that we fully support all of our suppliers with the resources needed to reach the goals we have set together. The Black Knight division will play a key role in ensuring this success."

In other news from the Foley empire, Scott Edwards has been promoted from executive vp at Foley Family Wines to president of Epic Wines & Spirits. Scott has 30 years of experience under his belt, dating back to his first job as an area sales rep in Virginia. He has also worked on the supplier side, advancing through various distributor management roles with the likes of Foster's Wine Estates and most recently Foley Family Wines.

RED BLENDS HAVE BECOME THE CRAFT BEER OF WINE

In recent years, red blends have emerged as the cool, edgy and increasingly popular table wine category. So much so that Niesen has deemed it the craft beer of the wine category. Like craft beer, red blends continue to grow wildly. They represented as much as 13% ($1.7 billion) of the $13 billion table wine sales made during the year through September 12, per Nielsen.

Exactly half of consumers told Nielsen in a recent survey they like red blends because they are a good way to experiment. Nearly one-fourth said blends are more interesting than single varietals and 20% said they are a better value. The last point is particularly noteworthy because they also tend to be at a higher price point.

Most wineries have taken notice of the category's ascent and have made red blends a must-have offering. In fact, more than 40% of the new wine entries in 2014 were blends, mostly red. "No other wine type has even come close to the same amount of new offerings to market," says Nielsen. Even cabernet, one of the biggest and most popular varietals, only saw 10% new entries.

Over the last year, we've heard several industry participants say they believe craft beer and spirits are more exciting than wine [see WSD 09-24-2015, WSD 05-20-2014 and WSD 02-23-2015] To those people we say, maybe red blends are the answer to that problem. After all, the popularity of red blends are being driven by millennials, according to Nielsen.

CASTLE BRANDS SEES IMPROVEMENT, THOUGH STILL REPORTS LOSS IN Q2

Castle Brands has reported sales growth of just over 38% to $18.5 million for its second quarter ended September. The brands driving this growth include, Goslings Rums and Stormy Ginger Beer, Jefferson's and Jefferson's Reserve bourbons, Clontarf Irish whiskey and Pallini liqueurs. Despite the increase in sales, Castle still recorded a $0.7 million loss, an improvement though from last year's loss of $0.9 million.

BREAKING IT DOWN. During the quarter, Castle bought more aged bourbon reserves, increased its Irish whiskey offerings, expanded its barrel program for Knappogue Castle Whiskey, and initiated two long-term new fill programs to meet future demand for the company's whiskeys. As such, whiskey revenues, driven by Jefferson's bourbon and the Irish whiskeys, saw a 73% increase. Goslings Rum case sales increased 7% to 47,000 cases.

"We expect these trends of increasing sales and improving financial performance to continue over the balance of the fiscal year and beyond," says president and chief Richard Lampen.

"JUST FIX ABC" INSTEAD OF PRIVATIZING UTAH

Utah has long had a love-hate relationship with its troubled Alcoholic Beverage Commission. You may recall, the DABC came under fire in 2011 after reports surfaced of bid rigging, nepotism and big overhead payments to favored vendors by the DABC [see WSD 02-01-2012]. More recent complaints have been about its inefficient centralized ordering system, low wages and employee morale in state-owned stores.

In an effort to clean up the system, Utah has flirted with the idea of taking its alcohol system private for years. There hasn't been much action on the topic in the legislature the last couple of years, but that hasn't stopped the buzz around it. Last year, a local paper took a survey and found that voters were evenly split on the idea of privatization [see WSD 11-12-2014].

A recent op-ed in the Salt Lake Tribune from representatives at Ray Quinney & Nebeker law firm argues that privatization is not the answer. They cite higher prices for alcohol and less variety on store shelves as reasons not to take the plunge. Instead, Brett and Janelle believe that "the agency is capable of functioning efficiently," if it would adjust some of the current laws, allowing alcohol stores to promote product, provide more resources for store owners, improve the product ordering system etc.

Your editors haven't gotten wind of any movement on the privatization front in Utah, but we'll keep our ears to the ground on this one.

WSD BRIEFS:

JOURNEYMAN DISTILLERY QUADRUPLES CAPACITY. Journeyman Distillery in Michigan has revealed a major expansion that quadrupled its production capacity and saw the addition of an event space, and a restaurant, reports a local affiliate. The distillery had been churning out about 2,500 bottles a week -- including their Featherbone Bourbon Whiskey, Last Feather Rye Whiskey, Buggy Whip Wheat Whiskey and Three Oaks Single Malt -- and after the expansion they will be able to produce 12,500 bottles a week.

ANGEL'S ENVY RELEASES LIMITED-EDITION CASK STRENGTH BOURBON. Cask Strength is aged up to seven years in American white oak barrels, blended into a single batch, finished in port casks and bottled at 63.95% abv. Angel's Envy, which you'll recall is now owned by Bacardi, will only be releasing 7,500 bottles of the bourbon. Cask Strength will be available starting this month in AZ, CA, CO, FL, GA, IL, IN, KY, MA, NJ, NY, OH, OR, TN, TX and WA at a suggested retail price of $170 a 750 ml.

ARMAND DE BRIGNAC LAUNCHES LIMITED EDITION BLANC DE NOIRS CHAMPAGNE. Blanc de Noirs is the newest prestige cuvee expression and joins the luxury portfolio alongside Gold Brut, Rose, Blanc de Blancs and Demi Sec. The champagne is a blend of three pinot noir vintages and Armand has only released around 3,000 bottles. Blanc de Noirs already exclusively launched with the UK retailer Harrod's in September. Blanc de Noirs is available in select markets at a suggested retail price of $800 a bottle.

Until tomorrow,
Emily

"Silent gratitude isn't much use to anyone." -- G.B. Stern

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