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Scotch Innovator Compass Box Eyes Expansion With New U.S. Sales Unit

June 1, 2015

Artisan Scotch whisky producer Compass Box remains a boutique operation, but its outsized influence in the category has made bigger players take notice, including Bacardi, which secured a minority stake in the company last year. Bacardi acquired its stake in Compass Box as part of a supply agreement under which Bacardi’s Dewar’s unit is providing whisky to the rising niche player, which continues to be independently operated by its founder and whiskymaker, John Glaser. While the Dewar’s deal has significantly boosted Compass Box’s supply base, Diageo remains the company’s biggest supplier, says Glaser, who was a Johnnie Walker marketing director before founding his own business in 2000.

Currently, Compass Box produces about 30,000 six-pack cases annually—including the Great King Street, Asyla, Oak Cross, Spice Tree, The Peat Monster and Hedonism brands—with the U.S. accounting for around half of volume. This year, the group is doubling down on U.S. growth opportunities with the establishment of an in-market sales force, which will number 10-12 people to start. “We’re at a turning point,” Glaser tells SND. “I think of it as the start of the ‘second book’ of Compass Box.” The new supply arrangement with Bacardi, he adds, “is a game-changer for us in terms of inventory we now have access to.”

Glaser sees the Great King Street blended Scotch brand driving volume progress for the Compass Box portfolio. Great King Street’s original Artist’s Blend, which debuted in 2011, is now being joined by a Glasgow Blend, billed as “a 19th-century recipe rebooted with 21st-century cask maturation techniques.” Those two whiskies retail in the $40-$45 range. Also new this year is a special “Quindecimus” expression of blended grain Scotch label Hedonism—Compass Box’s first product—created to commemorate the company’s 15th anniversary. Hedonism Quindecimus, made from a blend of whiskies whose average age is 30 years, is launching this month in an edition of roughly 5,700 bottles retailing at $175 apiece.

“Scotch shipments are down overall, but that doesn’t bother me,” Glaser says. “Most of that is standard or even deluxe Scotches that we’re not competing with. We’re competing at the higher end, against single malt brands and other world whiskies—and even other spirits like gin—for cocktail list placements. That’s how we’re going to build the brand.”

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