Spirits sales up
By Paul Vang
Montana Tavern Times
Spirits sales in U.S. control states – those states where spirits sales are controlled through state agencies, such as in Montana – were up in 2009, as reported by the National Alcohol Beverage Control Association (NABCA).
Montana is a member of NABCA, and Shauna Helfert, Administrator of the Liquor Control Division, is the current chair of the association.
Nationally, in the 12-month period ending with November, spirits sales (by volume) were up 2.0 percent. Measured in dollars, sales were up 2.6 percent during the same period.
In Montana, according to Distilled Spirits and Program Manager for the Department of Revenue's Liquor Control Division Steve Swanson, total cases of spirits shipped from the state warehouse were up 1.6 percent compared to calendar year 2008. Vodka products led sales trends with a 7.7 percent increase (13,000 cases) in case sales.
Some new products had good sales in 2009. Firefly Sweet Tea Vodka sold 3,481 “mixed cases” (see sidebar for explanation) in 2009. Sweet Carolina Sweet Tea Vodka sold 400 mixed cases, and Captain Morgan Long Island Iced Tea sold 303 mixed cases.
While their sales figures are little more than a statistical blip in overall case sales, three new Montana microdistilleries began marketing products in 2009. Vigilante Vodka, produced in Helena, began marketing in June 2009, with 38 mixed cases sold. Roughstock Montana Whiskey, produced in Bozeman, sold 119 mixed cases since September. The latest entry is Flathead Vodka, distilled in Eureka, in far northwest Montana, which sold 16 mixed cases in December, its first month on the market.
These new microdistilleries represent the first Montana-produced spirits since Montana Distillers, makers of the Lewis & Clark brand of spirits, was purchased by an out of state company in 2002.
Microdistilleries are just coming on line in Montana. Another microdistillery in the works is Free Spirit, an adjunct to Yellowstone Valley Brewing in Billings. According to an October 2009 article by Billings Gazette business reporter, Jan Falstad, Free Spirit was in the final permitting processes to begin distilling gin and vodka.
Beer and wine sales are also up. While figures for CY 2009 were not yet available, in Montana Fiscal Year 2008 the equivalent of 973,610 barrels of beer were sold. In FY 2009, according to LaNora Stigen, an accountant for the Liquor Control Division, beer sales increased to 990,362 barrels.
Wine sales, measured in liters, increased from 10,002,409 to 10,598,973.
Stigen points out that beer and wine sales are not broken down by brands. Beer and wine sales reports come from Montana's beer and wine distributors, and volumes are translated into barrels and liters for tax collection purposes.
There is no centralized collection point for specific sales data similar to that of spirits, as beer and wine sales go through a number of distribution points, unlike spirits, which all go through the Liquor Control Division warehouse.
Kristi Blazer, a Helena attorney and executive director of the Montana Beer and Wine Wholesalers Association, agrees that specific information about beer and wine sales is elusive, though she adds she gets a sense from talking to member businesses, “Beer volume may be up but it seems that dollars are down, indicating some trade-downs among beer drinkers. We do get a sense that many consumers of domestic beers are switching to less pricey brands. On the other hand, microbrew sales are holding steady.”
At the beginning of 2010, Blazer said she believes, from early feedback from Montana distributors, that sales are on an upward trend.
Tony Herbert of Helena, executive director of the Montana Brewers Association, the trade association of Montana's microbreweries, still has no hard figures for 2009 production, but believes the craft beer segment of the beer market is continuing to grow, both in Montana and nationally.
“In 2007 and 2008, we had double-digit growth of 10 percent or more," Herbert said. "I suspect 2009 will show growth in the 5 to 10 percent range.”
The Brewers Association website states that its member-brewers produce 70,000 barrels of beer annually, selling their products in over 600 retail outlets. That 70,000 barrels of beer translates out to just a 7 percent share of Montana's beer market. It's a small niche, but one that is growing.
Looking ahead, Herbert hopes to promote additional growth.
“I think many tavern owners perceive a need to broaden their offerings," he said. "We love to see Montana-made beer in all taverns. It's part of a value-added chain of Montana-grown and Montana-made products.”
He adds that his association recently received a grant from the Montana Department of Agriculture under their Growth through Agriculture program promoting Montana's agricultural products. The association is designing a seal that will be added to beer packages saying, “Grown and Brewed in Montana.”