A wealth of choice

A wealth of choice

Neil Ridley meets the independent bottlers dedicated to bringing consumers something a little different.

Production | 07 Sep 2012 | Issue 106 | By Neil Ridley

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Whichever way you look at it, we owe the indies a huge debt of gratitude. Not only have they bought us diversity and innovation, particularly over the last decade, but trace back their heritage in a ‘Who Do You Think You Are’ style and the whisky business starts to look a whole lot different to how you first imagined it.

Indie bottlers are, by their very nature, fiercely independent and considerably proud of their achievements in an industry now seemingly run on share prices and balance sheets. So get a handful of some of the most well known indies in the same room and sparks are bound to fly… aren’t they? I ask the questions…they provide the answers…and the drams.

The panel

Kai Ivalo (KI) Sales & Marketing Director, Scotch Malt Whisky Society
Euan Shand (ES) Chairman, Duncan Taylor
Karen Stewart (KS) PR & Marketing Manager, Wemyss Malts
Alex Bruce (AB) Sales & Marketing Director, Adelphi
Mark Watt (MW) General Manager, Cadenheads
Fred Laing (FL) Director, Douglas Laing & Co.

NR: We’re all aware of the whisky business being in rude health at the moment, but what’s the vibe from the indie bottler’s side of the fence and what challenges have presented themselves to date?

AB: ‘When I joined Adelphi eight years ago a lot of advice coming our way at the time was to buy as much stuff as we could, as it wouldn’t be available forever.

Our approach was to continue to buy just what we liked and of course sooner or later it became harder to find casks. But fortunately we built up good friendships in that time and have been able to get good quality casks, as we always have done.
The industry is booming, which does mean that there’s less matured stock around, but there are definitely ways and means to get casks.’

ES: ‘The business is doing great, but the problem for the distillers is that we’re riding on the coat tails of them, in that we can’t produce our own whisky and accordingly they control things now. Of course in the olden days, independent bottlers worked very closely with distilleries usually as their ‘marketing arms’. Independents have always been innovators, especially from the perspective of higher strengths and non-chill filtering, which we have been working with for 25 years.’

KI: ‘I suppose we’re a little bit different to everybody else in that by being a membership organisation we’re going direct to the consumer; we don’t need to be tied up with third party companies or distribution issues. We have a very lively barometer and the good news is that we’re an international business. We feel very positive and have, if you like, many suitors saying: “we’d love to have the SMWS in our country”.’

KS: ‘Wemyss is still quite a baby in this respect, having begun life in 2005, but we’ve now expanded the staff we have to three full time people, so in that respect, its hugely encouraging at the moment.

Our key export markets are taking up most of our time, France and Taiwan have been very promising surprises over the last 18 months as well as the US.’

NR: So the new and emerging markets are, like with the big boys, starting to bear fruit for the indies?

FL: ‘When we started out in Russia a decade ago, they came after our products with a vengeance, with very little education, which was bizarre. I think we’ve yet to sell more than a case of single malt in Brazil and with India, I’m sceptical about doing anything great, due to the state protections, which mean that a single cask release is hammered on price, way higher than anything that a distillery release would cost, which is a tough one for the consumer.’

ES: ‘The great thing about the emerging markets is that they’re willing to try new things. There’s no preconceptions there, you can hand them something new and they’re willing to try it. I’m not just talking about China – look at Russia, we do tastings there and some good business; yes they tend to drink it straight and as strong as they can get it, but they’re into blends, single malts and especially things with complexity.’

MW: ‘If you look at Taiwan, when I first went over, seven or eight years ago, unless it had Macallan on the label or was really coloured it wouldn’t sell. Nowadays, when I visit there are guys talking to me about different cask numbers of Milton Duff, which is an amazing turnaround.’

NR: Do you find there is a trend to favouring certain styles of whisky in the different territories you work in?

KI: Yes and no. In our case, most people buy into the proposition of variety and that at its heart is something adventurous. Having said that, Germany and the Nordic countries tend to favour our heavily peated releases, whereas the further east you go, the sherried and older whiskies prove to be very popular. They’re the more obvious trends. But what’s been pleasant is the open mindedness and not pigeonholing our members, which is a great relief.

NR: How are you finding the stock levels, now distilleries are seemingly needing more for themselves?

MW: ‘I always joke that it’s a love/hate relationship between indies and the distilleries – we love them, they hate us!When times are tough, the distillers are always wanting to sell us stuff. Then it’s quite a good time to be an independent bottler. But when things are going well, they’ll keep it for themselves.

There is stock kicking about, but you’ve got to search harder for it – more and more people are going after the stock.’

KS: ‘I don’t know if it’s ever been easy, but it’s certainly getting tighter to find stock. But it’s not just finding casks, but finding ones that we’re happy to bottle, which is why we’re developing our blended malts side, as who knows where single cask releases will go. We’ve set a certain standard so we don’t want to let them slip.’

AB: ‘We’ve found that the middle ground can be covered well with marrying casks together, including our Fascadale release (the 3rd batch brings together five casks from Highland Park) and Liddesdale (drawing together three sherry casks from Bunnahabhain). We’ve also found great success with our Nightcap series, which is a selection of four double miniatures from various single casks.’

ES: ‘Independents get a little bit of a raw deal these days and I feel for us, because it was independents who started this whole business – the distillers were farmers and the merchants were the guys who put them on the map.’

MW: ‘For sure. Look, at the end of the day, there’s definitely a place for us all- let’s not forget that Cadenheads and Gordon & MacPhail have been bottling for longer than a lot of distilleries.’

Part of the difficulties indie bottlers face is unraveling the perceived truths of malt whisky

NR: Do you guys feel an element of liberation from the big guys, in relation to creativity with your bottlings?

FL: ‘In a way, it’s about listening to consumers at ground level, often from conversations, that spark off ideas – for instance Big Peat, which came from a conversation I had with one of our designers, who drew this image of Big Peat, which was a tasting note I used. It’s not always about looking in the warehouse and seeing which casks to bottle, it’s looking at the potential commercial opportunities for new products -and most of the big guys have departments for that. In our case, it’s often down to these simple conversations or me on a flight at 35,000 feet after a couple of Drambuies!’

MW: ‘It’s definitely a long-term game and you’re tying up a lot of money in stock. But it’s costing more to find what we’re looking for, so it’s better for the likes of us to have lots of casks tied up for a long time. Everyone wants Ardbeg and Lagavulin and Port Ellen, so the prices start to get crazy.’

KI: ‘There’s a tremendous scope for creativity, the problem is finding time to do it. For instance next year is the society’s 30th anniversary and we’re continuing to innovate through our website and how members can access our whiskies online, through apps. What we are increasingly finding is that our consumers not only want to drink the whisky, but be entertained by it, either by our ambassadors around the country or the communications we send.’

NR: Have the recent changes in SWA guidelines had an impact on the way you do business and what do you think are the major problems faced by indie bottlers internationally?

KS: ‘We’re not actually members, but having an authority supporting the reputation of Scotch whisky is a good thing, also setting the rules that everyone has to play by makes it fairer.’

AB: ‘We’ve had to change packaging a few times and initially felt that that we were being steamrollered by the bigger members, but in general they do a great job internationally for the name of whisky.’

ES: ‘I think it’s cost us a lot of money to adhere to the new regs, although not that I don’t think we should. However one thing that does rankle is some of the packaging from bigger companies that doesn’t adhere to the rules.’

KI: ‘Part of the difficulties indie bottlers face, including us, is unraveling the perceived truths of malt whisky.

Some consumers have focused solely on the Ten Commandments, that ‘all whiskies from X distillery must have this flavour profile’ or whisky that is older or darker must be better etc.’

AB: ‘I think it takes around five to 10 years for the big guys to do their work educating and developing the blended whiskies and mainstream malts, which leads consumers to be more interested in what’s next, which is when the independents can move in. One thing that I’ve noticed is that there’s been a real surge in distillery bottlings over 46% and non–chill filtered, which I’d like to think is a direct result of the independent bottlers doing very well with this type of release.’

MW: ‘The hardest thing facing independent is that we’re a fairly difficult concept for people to get their heads around for the new markets, it helps when there’s more independent brands available in the market place. I wish we did, but we don’t have customers who only drink Cadenheads, one day they’ll be drinking one of our bottlings, the next a Douglas Laing, then a Gordon & MacPhail, then a distillery bottling of Highland Park, so it shows there’s room for us all.’

NR: So what’s next for the Indies? Where are we likely to see the independent movement heading during the next decade?

MW: ‘It’s tough to say, as having whiskies from more than 100 different distilleries gives Cadenheads a wealth to choose from, but as mentioned, the quality has to shine through. Since 1842, the motto has been ‘Best by Test’. I always tell myself, would I be happy to stand up and do a tasting in front of 300 people with this. If the answer’s no, then you just don’t bottle it. There has to be an absolute integrity there.’

FL: ‘In the purist sense, people are looking for something that’s a little bit more artisan. Sure it would be nice to do things on a much bigger scale, but we have to take the view that we’re a small company with a much more traditional and old-fashioned way of doing things to the business.’

KS: ‘The beauty of being a small company is that we can be quicker to make things happen because we lack the layers of authority bigger companies have, which is definitely what gives the indies a big advantage. The difficulty for all of us is in the new markets where customers are getting to grips with what single malt is, where single casks fit and what exactly indie bottlers are, so we very much have to keep asserting our credentials wherever we go.’
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