Spirits Price/Mix Deteriorates in August


The latest Nielsen data in the four weeks to August 22 shows that volumes grew 3.3% year over year, compared to 2% in the 12 weeks and 2.1% in the 52 weeks, reports UBS analyst Melissa Earlam. However, price/mix is deteriorating. Price/mix declined by -0.2% for the month year over year. It actually grew 0.4% in the 12 weeks and 0.8% over the 52 weeks period. Meanwhile, August dollar sales grew 3.1%, which outpaced growth in the 12 weeks (2.4%) and 52 weeks (2.9%).

The percentage of volume on promotion for the market is up 0.4% to 42.3% overall. Diageo volumes grew 3.9% year over year for the 4 week period, while dollar sales grew 2.6%. The company gained volume share but lost value share, says Melissa. Diageo increased its promotional activity ahead of the market, up 4.5% to 52.8%.

Pernod’s volume grew 0.1% while sales grew 0.5%. Campari’s volumes were down significantly in the 4 weeks with a gain of 0.1%, compared to the 12 and 52 week trends of 4.3% and 12% respectively. Remy volumes declined -10.4% and sales were down -5.7%. Brown Forman volumes grew 0.7% and sales rose 0.8%. Lastly, Constellation’s volume fell -1.1%, while sales grew 6.1%.

Melissa said they “continue to expect the US spirits market growth trend to slow.” In 2009 UBS estimates 1% market volume growth in the US and 1.6% value growth.


You may remember this story from years back when Mark Anderson (who used the alias Joe Sausalito) was accused of setting fire to his Vallejo warehouse Sausalito Cellars that destroyed millions of bottles of wine. He allegedly tried to point the finger at other individuals in anonymous internet postings according to prosecutors, the San Francisco Chronicle reports. His trial date is set for November 17 where he will face an arson charge and 18 other criminal counts in a federal court in Sacramento.

He’s accused of setting the fire after being caught in a fraud scheme where he allegedly sold thousands of his clients’ collectables to wine dealers. An estimated $250 million worth of wine was destroyed in the blaze.

Mark’s attorney argues that his client had no reason to start the fire and doesn’t believe the government can prove he was the one making the anonymous posts, although prosecutors claim the postings were traced back to Mark’s computer.


High-end wines are headed for deep discounting in the coming weeks (if they haven’t already), says Daniel Posner owner of Grapes The Wine Company. This is according to a new article in Forbes that seeks to help consumers find good deals in the luxury sector. Wines $50 and above have had a tough time since the recession began nearly a year ago, and much to the surprise of some in the industry, things aren’t getting any easier.

Daniel told the publication that his business “did a liquidation six months earlier this year,” but distributors “were waiting out the storm, and it just blew up in their faces.” In other words, the recession lasted longer than some distributors expected and sales never bounced back. Now distributors are dropping prices to new lows in order to clear inventory, which is expected to last through September before we slide into the pre-holiday selling extravaganza, says the article.

We’ve gotten a lot of similar reports from wholesalers and others in the industry as well. Hopefully they can make up for their losses during the holidays. Good time to be a consumer – perhaps not so good for some wholesalers and retailers. The article tells consumers to sign up for email alerts from wine retailers and/or follow them on twitter to hear about great deals. If you’re a retailer, bar or restaurant, this is a great way to drive traffic.


HEAVEN HILL NAMES NEW COO. Alan Latts has been named Heaven Hill Distilleries’ first coo after serving as director of corporate planning since 2001. Alan is married to Kate Shapira Latts, the company's marketing director and daughter of Heaven Hill President Max Shapira, reports the Louisville Courier Journal. Max noted in a statement that his daughter and son-in-law “represent the third generation of our family’s leadership.”

A MASSACHUSETTS COURT OF APPEALS ruled that Anheuser-Busch can only sell beer and wine in the state, and denied its bid for a wholesale liquor license. AB won a license to sell all alcoholic beverages in 2006 but the Wine & Spirits Wholesalers of Massachusetts challenged its validity in court. The state’s ABC took back AB’s larger license in 2007, and an appeals court agreed this week that state law prevents AB from holding a license for beer, wine and spirits.

LAURENT-PERRIER USA has named Bertrand de Fleurian as its president. He has been with the company since 1987 where he first worked as Area Manager of the Export Department for Northern Europe, Asia Pacific and South America.

TAVERN ON THE GREEN has reportedly filed for Chapter 11 bankruptcy protection due to the recession and the recent loss of its lease with Central Park. The LeRoy family has run the famed restaurant since the mid-1970s, but NYC’s parks department tapped Dean Poll, ceo of Boathouse LLC, as its new licensee. He’s agreed to renovate the restaurant for roughly $25 million. Tavern on the Green will continue operations until the LeRoy’s lease expires at the end of the year.

THE WASHINGTON STATE SUPREME COURT ruled yesterday (Sept. 10) that judge’s can issue a warrant that forces suspected drunken drivers to submit a blood or breath test if they refuse to do so voluntarily.

COTES DU RHONE wine region is launching an advertising campaign in the US titled "Côtes du Rhône: Always Right." The campaign is the first from the region to run in the United States and will be featured in print publications and out-of-home executions in the New York market.

Until Monday, Megan

“Sometimes the mind, for reasons we don't necessarily understand, just decides to go to the store for a quart of milk.”
Diane Frolov and Andrew Schneider

--------- Sell Day Calendar ----------
Today's Sell Day: 9
Sell days this month: 22
Sell days this month last year: 22
This month ends on a: Wed.
This month last year ended on a: Tues
YTD sell days Over/Under: 0

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