Exclusive news and research on the wine, spirits and beer business

News Briefs for January 22, 2016

January 22, 2016

•On-premise traffic fell 1.2% for the year in 2015, according to GuestMetrics, due in part to an underperforming and ill-timed holiday season, as traffic fell 2.6% for the four weeks through December 27. Total alcohol unit volume was also down, falling 2.7% in 2015, though total alcohol dollar sales eked out 0.4% growth for the year. Domestic craft spirits emerged as a bright spot over the 12 months, rising 40% year over year, compared with a 0.3% volume decline for the overall spirits category. Beer volume, meanwhile, slipped 4.7%, with craft beer (-2.3%) also softening, and wine unit volumes similarly slowed, down 2.4%, with the wine category’s dollar value roughly flat.

•Heaven Hill Brands is planning to undertake a $15.5 million expansion project at its Bernheim Distillery, reports the Louisville Business Journal. The expansion marks the third for Bernheim—where Heaven Hill distills Evan Williams, Elijah Craig, Larceny, Old Fitzgerald and other brands—since 1999. Upgrades will include a 4,600-square-foot addition, three new fermenters and a new still, with work likely to begin in the next few months.

•In its annual State of the Wine Industry Report, Silicon Valley Bank (SVB) projects that 2016’s total and per-capita U.S. wine consumption will see its first drop in more than 20 years. The decline will be “due to emerging generational shifts in consumption patterns” that will accelerate in the near term, said Rob McMillan, the report’s author and founder of SVB’s Wine Division. He cited “a permanent shift from generic wine, and aging baby boomers being replaced by frugal millennial consumers.” The report projects volume and price drops for wines below $8, as well as vineyard reductions in the Central Valley. But it forecasts growth of 4%-8% for domestic wine above $10 this year, along with a 9%-13% advance for fine wine. Bottled wine imports will resume their prior trend of eroding U.S. fine wine market share, the report added.

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