Dear Client: 

Late last night the Senate unanimously passed the $2 trillion economic stimulus package to provide relief for individuals and businesses impacted by COVID-19.

The legislation includes much needed relief for distressed companies and individuals. There’s a lot in the 880-page bill, and the Distilled Spirits Council pulled out some important highlights: 

• $349 billion for Small Business Administration loans 
• $10 billion for SBA emergency grants of up to $10,000 for immediate relief for small business operating costs
• $17 billion for SBA loans to cover 6 months of payments for small businesses with existing SBA loans
• A retention tax credit for employers to encourage businesses to keep workers on payroll
• 13 weeks of additional unemployment insurance for employees
• Up to $1,200 payments to Americans who make $75,000 or less, plus $500 per child with benefit tapering off for higher incomes

The bill also includes a federal tax waiver for distillers’ production of hand sanitizer. You may recall, the Alcohol and Tobacco Tax and Trade Bureau issued guidance on hand sanitizer production. One provision exempted hand sanitizer products from federal excise tax, unless it’s made with undenatured alcohol, which is what most have on hand as that’s the kind that’s safe to drink [see WSD 03-19-2020]. 

“We greatly appreciate Congress’ efforts to make this important change regarding the federal excise tax and hand sanitizer production,” says DISCUS chief Chris Swonger. “Hundreds of US distillers are stepping up to produce hand sanitizer and they should not be hit with a huge tax bill for producing this much-needed item, especially at a time when so many of them are struggling.” 

An ever-growing list of distillers have begun producing hand sanitizer and/or donating alcohol to hand sanitizer manufacturers to address the shortage. 

DISCUS also urges the FDA to update their guidance in response to ensure distillers don’t face any tax hit.

The House is expected to vote on the relief package tomorrow. 

PERNOD RICARD ACQUIRES REMAINING STAKE IN MONKEY 47 

Pernod Ricard announced today that it has acquired the remaining stake in Monkey 47. You may recall, the company acquired a majority stake in Black Forest Distillers, the makers of Monkey 47 gin, back in 2016 [see WSD 01-29-2016].

“The agreement is a logical consequence of the brand’s progress following the partnership with Pernod Ricard,” says Black Forest founder Alexander Stein. “It has been a fantastic journey and I look forward to personally contributing to Monkey 47’s future trajectory.” Indeed, Alexander will remain active in an advisory capacity for the brand, per a release. 

“This partnership is a clear example of Pernod Ricard’s ability to incubate small independent distilleries while respecting entrepreneurial freedom and the brand’s core values,” says Pernod chief Alexandre Ricard, adding, “However, Monkey 47’s success story would not have been possible without Alexander Stein’s trust, authenticity and entrepreneurial spirit, for which I am grateful.” 

CONSTELLATION TO DONATE MORE THAN $2.5 MILLION TO COVID-19 RELIEF EFFORTS 

Many bev alc industry members are doing what they can to help those impacted by COVID-19, from making hand sanitizer to donating to various relief efforts. 

Today, Constellation Brands announced that it, in partnership with its flagship brands Corona, Modelo, Kim Crawford, Meiomi, The Prisoner and High West, is donating more than $2.5 million to COVID-19 relief efforts, including: 

• Contributing $1 million to the National Restaurant Association Educational Foundation
• $500,000 to US Bartenders’ Guild
• $250,000 in support of first responders
• Establishing a company COVID-19 Relief Fund and will match employee contributions 2:1
• Mobilizing employees nationwide to support local restaurants
• $250,000 to support relief efforts in Italy

“Our hearts go out to the many individuals and businesses impacted by this terrible virus,” says chief Bill Newlands. “Many of our retailer partners, particularly local restaurants and bars and their employees, have been significantly impacted by this situation. These businesses are essential to the fabric of our communities. It’s important that we all come together to help those most in need in this critical time. We are focusing our support on efforts that directly benefit those impacted today while also helping the larger industry on its path to recovery.”

E&J Gallo also recently announced that its Barefoot wine brand has donated an initial $100,000 to Children of Restaurant Employees (CORE), which supports food and beverage employees and their families. Gallo also announced a $100,000 donation from seven wineries within its premium wine division (J Vineyards & Winery, Louis M. Martini, Orin Swift, Pahlmeyer, Talbott Vineyards, Whtehaven and William Hill Estate Winery) to support GuildSomm. The company is also matching employee contributions one-to-one.

Heaven Hill Brands has also committed financial and physical resources in recognition of the need of employees, the community and the greater hospitality community, pledging $400,000 distributed across One Louisville, Tri-County United Way, Stand with Austin, United Way of Lethbridge & South Western Alberta, and Community Foundation of Ireland.

DIAGEO CMO TO RETIRE

Earlier this week, Diageo announced that North America president Deirdre Mahlan will be retiring, effective June 30 [see WSD 03-24-2020]. Diageo cmo Syl Saller will also be retiring at the end of June, per Forbes. 

Syl joined the company in 1999 as marketing director, became global innovation director in 2004 and was named cmo and chief innovation officer in 2013. 

Current global category director of scotch and managing director for Diageo’s luxury brands business Cristina Diezhandino will take over as cmo. 

“I am very proud of what I’m leaving behind – a strong function that is committed to getting better by learning and growing themselves,” says Syl. “I’m even more thrilled that Cristina has been appointed our new cmo – she is a remarkable leader, driven by both performance and creativity. Cristina has a deep understanding of brands, markets and operations and is widely respected, unflappable with deep compassion for others.”

WSD BRIEFS:

VINEYARD BRANDS ADDS HAMILTON RUSSELL OREGON TO PORTFOLIO. Vineyard brands had added two Hamilton Russell Oregon wines to its portfolio; the 2018 Bramble Hill Pinot Noir and the 2018 Zena Crown Pinot Noir. Both will be available nationwide with a suggested retail price of $86.

375 PARK AVENUE SPIRITS TO DISTRIBUTE NOVO FOGO CACHACA. 375 Park Avenue Spirits has been named the exclusive sales and distribution partner in the US for Novo Fogo Cachaca. As part of the agreement, 375 Park Avenue Spirits will assume responsibility for all sales, distribution, importation, and operational logistics in the US and will support the brand’s marketing efforts. The Novo Fogo portfolio includes Silver, Chameleon, Barrel-Aged Cachaca, Tanager, Colibri, Graciosa, as well as “easy to drink items” such as the Caipirinha Kit, single-serve cocktail kits and sparkling Caipirinha canned cocktails. 

Until tomorrow,
Sarah

“Your present circumstances don’t determine where you can go; they merely determine where you start.” – Nido Qubein

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