The sky appears to be the limit for high-end imported spirits sales at the U.S. beverage alcohol retail tier. “Demand will continue, and we will be able to sell any and all allocations we receive,” says Bob Kreston, owner of Kreston Wine & Spirits in Delaware. “We are seeing a number of price increases throughout all categories due to shipping and supply costs increasing.”
Imported spirits sales at Kreston’s two stores were essentially flat last year, but consumers are trading up. “We saw consumers continuing to drink at home and treating themselves to more premium spirits,” Kreston says. “Home entertaining played a large factor. Depending on the category and type, $40 to $75 per bottle is where the volume is.”
Indeed, 70% of Kreston’s overall spirits sales in 2021 comprised imported selections. The top two imported spirits brands at Kreston Wine & Spirits are both Cognacs—Hennessy V.S. ($42.89 a 750-ml.) and Rémy Martin VSOP ($53 a 750-ml.), while the next four leading imported spirits brands are whiskies—The Balvenie DoubleWood 12-year-old single malt ($70 a 750-ml.), The Macallan 12-year-old single malt ($75 a 750-ml.), Jameson Irish ($44.89 a 1.75-liter), and Dewar’s blended Scotch ($35.89 a 1.75-liter). “We continue to experience a number of items out of stock and being delayed coming back to market,” Kreston says. “As they come back in limited quantities, we are finding they’re being allocated per SKU, so we’re not getting enough to meet the demand. Spirits in general will continue to increase in sales and demand. Our customers are always looking for new brands to try, and they enjoy the variety we offer.”
Kreston Wine & Spirits deals with out-of-stocks by informing its clientele via email when brands have been restocked. “We continue to send weekly emails to our customers to let them know what is available and when the items that have been out of stock have returned,” Kreston says. “We track sales and history of our customers so we can target those customers’ requests, and we’re also working to upgrade our website and p-o-s system to provide our customers with better information.”
San Francisco-based Wine.com experienced strong trading-up trends for imported spirits in the four states—California, New York, Florida, and New Jersey—where it sells spirits. Last year, imported spirits represented 77% of Wine.com’s spirits revenue and 71% of its unit volume. The average price per 750-ml. for imported spirits was $61.76, while the average price for domestic spirits was $44.96. “We serve the discovery segment of the spirits industry,” says Wine.com founder Michael Osborne. “If we are out of one Tequila, there is another one standing in the wings.”
Imported high-end spirits sales at Wine.com are dominated by whisk(e)y and Tequila. “Our customers enjoy our wide assortment—roughly more than 500 varieties of Tequila and mezcal were purchased last year,” Osborne notes. “In the whiskey category, from more than 1,150 total choices, customers purchased more than 400 bottlings from Scotland, 250 from Kentucky, and 100 from Japan. Our customers love the selection we offer. You can’t get it in another market. They’re always looking for another discovery.”
Wine.com’s Osborne anticipates imported offerings to continue dominating spirits sales at his company. “It’s the overwhelming majority of our spirits business today, and there’s no signs of this trend changing,” he says. “Wine.com customers enjoy the discovery of different regions and grapes, and this curiosity carries over to spirits. The regions, raw materials, water sources, and history of distilling can be viewed in a similar way. We don’t carry a lot of bottles that cost under $15. When you offer people choices at a premium, they’ll take it. Customers want to travel the world.”