Jack Daniel's Whiskey Exports Soar
Global Drinkers Demand Authentic American Whiskey
In 1993, parent company Brown-Forman (NYSE:BFB) decided to expand its international trade footprint. The company’s strategic plan was to market its premium spirits brands like Jack Daniel’s to some 135 countries outside the U.S.
Last month, Brown Foreman announced that international sales have grown from 20% to 52% of total company revenues.
For the first time in the company’s 142-year history, foreign consumers now drink more Jack Daniel’s than American drinkers.
A record 9.45 million nine-liter cases of Jack Daniel’s Tennessee Whiskey were sold in fiscal 2008.
And there was more positive news. Parent company revenues in latest fiscal year ending April 30, 2008 hit US$3.28 billion, up 17% from 2007 while earnings rose 14.4%.
Jack Daniel’s Tennesse Whiskey Sales Slow in the U.S.
While sales of Jack Daniel’s Tennessee Whiskey in America rose for the 16th consecutive year, the U.S. growth rate was only 1%. On average, the industry average increase for distilled spirits in the U.S. at 3.1% was much higher.
Brown-Forman management point to four possible reasons for slowing sales of its flagship premium whiskey brand.
- Consumer resistance caused by prices rising to $20 and $40 for different bottle sizes in most U.S. states.
- Tougher economic times in the U.S. push some Jack Daniel’s drinkers to trade down to cheaper alternatives.
- Competitors in the alcoholic beverage industry cut prices to entice drinkers to try their discounted premium whiskies.
- Trading up to super-premium whiskies like the recently repackaged Gentleman Jack brand, the fastest-growing brand in Brown-Forman’s portfolio.
The United States remains the largest and most important single country market for Brown-Forman alcoholic products led by Jack Daniel’s, generating 48% of overall net sales. European countries represent 29% of overall net sales while other countries including China, Russia, Japan and Canada account for the remainder.
International Demand for Jack Daniel’s
Jack Daniel’s continues to be a major success story on global markets. International demand were the primary drivers for Jack Daniel’s overall 4% sales increase to 9.45 million nine-liter cases in fiscal 2008. Markets outside the U.S. contributed more than 85% of the overall growth in net sales.
The U.K. is the next largest market for Jack Daniel’s exports, finishing only behind America. Drinkers in the U.K. consume about 1 million nine-liter cases annually, making Jack Daniel’s the largest-selling whiskey sold on-premise in the U.K.
Germany is currently the third-largest market for Jack Daniel’s whiskey.
Other fast-growing international markets for Jack Daniel’s brand include:
- Australia
- Canada
- China
- Czech Republic
- France
- Italy
- Japan
- Mexico
- Poland
- Russia
- South Africa
- Spain.
Sales of Jack Daniel’s in China were up 125,000 cases per year, an amount 45% higher than 5 years ago. Jack Daniel’s continues to make progress in smaller Asian markets like Taiwan, where sales are up 21% from 5 years ago to about 10,000 cases annually.
Jack Daniel’s Family of Whiskies
Jack Daniel’s includes a portfolio of whiskey drinks, not just the flagship Tennessee Whiskey brand. This family of brands includes:
- Jack Daniel’s Old No. 7 Brand Tennessee Whiskey (Black Label and Green Label)
- Jack Daniel’s Single Barrel Tennessee Whiskey
- Gentleman Jack Rare Tennessee Whiskey
- Ready-to-drink product lines Jack Daniel’s & Cola and Jack Daniel’s Country Cocktails.
In Australia, the Jack Daniel’s ready-to-drink version was Brown-Forman's most popular and fastest-growing product.
