New DSC Chief Details Top Priorities for 2019

Distilled Spirits Council ceo Chris Swonger officially took the helm on November 12 [see WSD 10-17-2018]. Your editor sat down with the new DSC ceo in Austin, TX last week to discuss his new role and top priorities for the year.

Chris is no stranger to the bev alc industry having spent 15 years at the likes of Allied Domecq and Beam (before Suntory), but has been out of the game for almost a decade. “That’s what I’ve been doing over the last couple of months is reconnecting with all the great people of this industry and reintroducing myself because I’ve been out of action for nine years,” Chris tells WSD.

TOP PRIORITIES. At the federal level, The Council’s top priorities are: 1) getting Congress to reauthorize the Craft Beverage Modernization and Tax Reform Act (which you’ll recall was reintroduced just last week, see WSD 02-06-2019); and 2) navigating through the challenges involved with the retaliatory tariffs, according to Chris.

One aspect in dealing with the retaliatory tariffs includes resolving the issue with Mexico and Canada through the US-Mexico-Canada Agreement, which currently includes new best practices regarding labeling and certifications for spirits, but does not remove the tariffs placed on US whiskey. The agreement is slated to come before Congress later this year.

At the state level, Chris says they’re “working on issues to help drive consumer convenience,” which includes opening up Sunday sales in certain states as well as removing restrictions on package store permits, both of which are issues The Council is currently tackling in the Lone Star State.

At a strategic level, Chris says: “The distilled spirits strategic priorities, top line–of which I inherited and fully subscribe to– drive consumer convenience, seeking market access, making sure our products are treated the same as beer and wine, and social responsibility.”

In addition to his role as ceo of The Council, Chris also took on the role of president and ceo of Responsibility.org as of January 1. Responsibility.org promotes responsible drinking and leads the fight to eliminate drunk driving and underage drinking.

“It’s a new role, where I’ve got the privilege to lead and represent both organizations,” Chris tells WSD.

“I really am going to be splitting my time back and forth. And I think the organizations can work together hand in hand to some degree, but they are two separate organizations,” he says. “We’ll certainly work hard to synchronize the organizations where we can. You know as the industry evolves, market dynamics change, part of my responsibility is to lead those efforts on both fronts.”

ON CANNABIS. The Council is also keeping an eye on the burgeoning cannabis industry. The emergence of cannabis creates a lot of questions about the implications for the bev alc industry, according to Chris, including whether or not it’s complementary, social responsibility and the regulatory framework.

“It’s going to be an interesting dynamic as this thing unfolds in the coming years,” he says, adding, “It’s an exciting time for the industry.”

NEW BILL INTRODUCED TO LOOSEN RESTRICTIONS ON INDIANA WINERIES, DISTILLERIES

A new bill introduced in the Indiana legislature would loosen restrictions on wineries and distilleries, and give them the same privileges that breweries in the state already enjoy.

HB 1422 would nix the requirement that wineries and distilleries that include restaurants have to first sell the product they make on-site to distributors and then it can go to the restaurants; allow wineries and distilleries to sell and provide samples at farmers markets; and it would allow distillers to ship directly to consumers in the state, per the Indianapolis Business Journal.

“We’ve created some privileges for breweries that wineries and distilleries don’t have, and we’re trying to help them catch up,” says Rep. Ed Clere, who authored the bill.

CASTLE BRANDS’ Q3 RESULTS NEGATIVELY IMPACTED BY MIX

Castle Brands net sales were down 6.4% in the third quarter ended December 31, dragged down by Jefferson’s as the brand’s sales skewed more toward the lower price and lower margin expression, Jefferson’s Small Batch, during the quarter, according to Castle Brands chief Richard Lampen.

A one-time $1 million increase in professional fees also negatively impacted results in Q3.

“Setting aside the case mix in the third quarter, we expect the strong growth in Jefferson’s to continue to drive our long-term trends of increasing sales and improving financial performance,” says Richard.

In fact, Jefferson’s volumes were up 20.7% for the nine-month period. Richard also expects sales to improve in Q4 with the release of higher-priced expressions such as Jefferson’s Pichon Baron and Jefferson’s Ocean Cask Strength.

Sales for the nine months were up 4.7% to nearly $69 million.

WSD BRIEFS:

DELICATO FAMILY WINES LAUNCHES THREE FINGER JACK. Delicato Family Wines has released the inaugural vintage of 2016 Three Finger Jack East Side Ridge Cabernet Sauvignon. The wine is sourced from vineyards on the east side of Lodi. Three Finger Jack is now available nationwide for approximately $22 a 750 ml.

DIAGEO’S DELEON TEQUILA RELEASES ANEJO RESERVE. DeLeon Anejo joins the portfolio alongside Platinum, Reposado, Diamante, Extra Anejo and Leona. Anejo is set to hit shelves nationwide this month.

HAAGEN-DAZS LAUNCHES SPIRITS-INFUSED ICE CREAM. Haagen-Dazs has announced the release of its Spirits Collection, which includes: Irish Cream Brownie, Rum Tres Leches, Bourbon Vanilla Bean Truffle, Stout Chocolate Pretzel Crunch, Bourbon Praline Pecan, Non-Dairy Amaretto Black Cherry Almond Toffee and Irish Cream Cookie Squares. Though the frozen treats aren’t very boozy as each product contains less than 0.5% alcohol, per a release. The collection is rolling out now and is slated to be widely available by April.

Until tomorrow,
Sarah

“Life lived for tomorrow will always be just a day away from being realized.” – Leo Buscaglia

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