Backed By Beam Suntory, Sipsmith Gin

Plans U.S. Expansion

Beam Suntory acquired a controlling stake in U.K. craft gin label Sipsmith late last year, aiming to grow the brand in gin’s fast-growing super-premium segment. Speaking to SND recently, Suntory Holdings CEO Takeshi Niinami said the Sipsmith deal is an example of the type of opportunistic, value-creating craft spirits plays the company will continue to pursue looking ahead.

Established in London in 2009, Sipsmith initially launched in the U.S. in 2013 through Wilson Daniels, ultimately reaching around 30 markets. With the transition to Beam Suntory, the brand is revamping its U.S. strategy, looking to focus efforts in six key metro areas: New York, Chicago, San Diego, Los Angeles, San Francisco and Seattle.

Discussing the brand’s fresh U.S. approach, Sipsmith co-founder Sam Galsworthy told SND, “What we’ve done is refocused so that we can get consistent supply and consistent messages to the right people in the right places. We’re going narrow and deep. We’re targeting cities that will truly resonate with the Sipsmith message toward classic-style cocktails and authenticity.”

The Sipsmith range comprises a classic London dry gin ($32.99 a 750-ml.), as well as a Sloe Gin ($39.99) and its 57.5%-abv V.J.O.P. label ($47.99), which stands for “Very Junipery Over Proof.” Currently, the U.S. accounts for around 10% to 15% of the brand’s total sales, though Galsworthy expects that share to grow. To prepare for expansion, Sipsmith is working to ramp up production, with plans to install a pair of new pot stills at its distillery in West London’s Chiswick district in the coming months.

Beam Suntory’s investment in Sipsmith comes amid a wave of activity within the super-premium gin sector, which has long been led by Bacardi's Bombay Sapphire ($27), and has been invigorated in recent years by brands like William Grant’s Hendrick’s ($35). In February, Gruppo Campari purchased Bulldog Gin ($26) for roughly $58 million, while in April, TD Artisan Spirits—a joint marketing venture between Terlato Artisan Spirits and Distell USA—added Brooklyn’s Greenhook Ginsmiths ($34-$50) to its stable. Other high-end gins making inroads in the U.S. include Proximo’s Boodles and Quintessential Brands’ Greenall’s (around $20), both from the U.K., as well as Cognac Ferrand’s Citadelle brand ($25-$35) from France.

Wine Spectator: Longtime Partners Purchase Oregon

Pinot Noir Star Adelsheim Vineyard

Nearly five decades after founding one of Oregon’s leading Pinot Noir labels, David Adelsheim is stepping back from his eponymous winery. But he knows the new owners pretty well. David and his wife, Ginny, have sold their ownership in the winery to Jack and Lynn Loacker, who have co-owned the company since 1994. Adelsheim will continue to represent the winery in an advisory role and the Loackers plan to keep the current winemaking team in place. The price of the sale was not disclosed. Wine Spectator has the full story.

ABI’s U.S. Revenue, Sales Slide In First Half

Amid a difficult beer market, Anheuser-Busch InBev (ABI) saw its U.S. revenues decline 1.3% for the first half of the year, as sales-to-retailers fell 3%. ABI’s struggles were primarily attributable to its mainstream portfolio, including Budweiser and Bud Light, which has been negatively impacted by trading-up trends.

The brewing giant fared better at the above-premium level, where Michelob Ultra and Stella Artois continue to thrive—both labels earned Impact “Hot Brand” honors for 2016. Likewise, ABI’s value stable showed healthy progress in the first half, boosted by the Busch brand family. Overall, ABI’s North American volumes slipped 2.6% on an organic basis to roughly 57.2 million hectoliters in the first half.

Globally, ABI fared notably better than in the U.S., posting first-half revenue growth of 4.4% to $27 billion, as volume rose 0.3% to 306 million hectoliters. International progress was driven by solid gains in markets such as Mexico, South Africa and China, among others.

News Briefs:

•Georgia-based Blue Ridge Spirits & Wine Marketing has added Florida’s Big 5 Rum brand to its distribution portfolio. Distilled in St. Petersburg, Florida, Big 5 was inspired by the Big Five social clubs of 1950’s Havana, Cuba. The rum is made from Florida-sourced sugar cane molasses, which is then cut with pure distilled water at four separate points throughout distillation. The 40%-abv Big 5 Silver, the 40%-abv Big 5 Gold and the 35%-abv Big 5 Coconut are available in Florida, retailing at $20 a 750-ml. Blue Ridge plans to expand Big 5’s distribution footprint to more markets in 2018.

Craft Brewing And Distilling News:

•New York’s Brooklyn Brewery, California’s 21st Amendment Brewery and Colorado’s Funkwerks have partnered to create a nationwide sales and distribution platform. The project will officially launch on January 1, 2018, with 70 shared sales representatives and 90 brand ambassadors spread across 38 states. The partnership means that Brooklyn’s beers will reach Northern California, 21st Amendment’s beers will enter the southeast U.S. and Funkwerks will be distributed in New York, among other new market entries. As part of the venture, Brooklyn has purchased minority stakes in both 21st Amendment and Funkwerks.

•Michigan-based Short’s Brewing Co. has sold a nearly 20% stake to Lagunitas U.S. Holdings, a wholly-owned Heineken subsidiary, for an undisclosed sum. According to a release from Short’s, the partnership will ensure that the brewery is financially viable in the competitive craft beer market while offering opportunities for expansion.

•Denver’s Laws Whiskey House has linked with distributor Breakthru Beverage Group in its home state of Colorado, effective August 1. Previously, Laws Whiskey handled its own Colorado distribution in-house. Breakthru will represent the craft distiller’s portfolio—including its flagship A.D. Laws Four Grain Straight Bourbon, Bottled in Bond Four Grain Straight Bourbon and Bottled in Bond Secale Straight Rye, as well as seasonal offerings—throughout the state. Laws Whiskey, which currently distributes to 12 states, expects to build on its partnership with Breakthru in additional markets.

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