Marketing

The Rise of Store-Branded Private Bottlings

More liquor stores are buying their own barrels, and selling private bottlings. Is it worth the effort—and the cost?

Collage of private label liquor bottles
Photo courtesy of Hi Time Wine Cellars.

In an increasingly competitive retail marketplace, enterprising operators are finding new ways to differentiate themselves. A growing number are developing store-branded private label bottlings with the intention of building limited-edition buzz. The strategy can be a cost-effective way to generate marketing moments through newsletters and social media platforms while delivering unique products to customers.

It’s not a new concept. “The Scottish have been doing it for centuries,” says Scott Crestodina of Independent Spirits liquor store in Chicago. And back in the 1960s and ’70s, the Van Winkle family made some private barrel selections of bourbon for individual customers at the old Stitzel-Weller distillery in Shively, Kentucky, “that would make your head spin,” says Matt Colvin, a beer and spirits buyer at CoolVines in Jersey City, New Jersey.

But private selections are no longer so specialized—they’re showing up in big and small liquor stores around the country in greater numbers each year. Colvin explains that the trend “has boomed with the rest of the whiskey market” and that some distilleries have seen such huge increases that they’ve had to limit the private barrels they sell.

Heaven Hill in Bardstown, Kentucky, for example, had four different products available for barrel selection as recently as 2013, but the distillery’s supplies of barrels for aging, which currently amount to 1.3 million barrels, couldn’t handle the demands. “We effectively went dark on the program for a couple years in order to more prudently manage [it],” says Josh Hafer, the communications manager for Heaven Hill Brands. “We now have Elijah Craig Small Batch bourbon available for private barrel selection, but even that program will be limited.”

Four years ago, Holden Persohn started ordering for Hi-Time Wine Cellars in Costa Mesa, California, and since then he has increased his private orders because they sell out so quickly—one private barrel of Weller Antique 107 lasted in the store less than a week. And that’s the equivalent of 24 to 30 cases of a dozen 750 ml-bottles, says Persohn. Most of those were shipped to Ohio. (“Word got out,” he says, deadpan.) Persohn tries to stock half a dozen private bottlings at a time, including selections from Buffalo Trace, Eagle Rare, Weller 107 Antique, and Blanton’s (“when they allow it”). “Our private barrels have a little bit of a cult following,” he says. “Not to pat myself on the back, but I pick out some pretty darn good stuff.”

Collage of private label liquor bottles
Photo courtesy of Hi Time Wine Cellars.

Crestodina is similarly proud of his selections for Independent Spirits. “We have gained a small following for the barrels we’ve selected,” he says, adding that the efforts are the effort is a nice way to feed the store’s social media accounts. Loyal customers also tout the barrels on social media, promoting the liquor store in the process. Crestodina also says that the staff is more enthusiastic about batches they help choose. It’s the liquor store equivalent of staff selections at an independent bookstore. “Excitement sells,” he says. “I get a little sad every time one runs out.”  

For Colvin, the private bottlings are worthwhile, in part, because they enable him to provide a unique experience for his clientele—one that he personally curates. “It offers customers insight into what we are trying to do here,” he says. “They have come to know and trust my palate. I have customers who ask if I have new barrels in stock, and if I do, they will take several bottles without tasting [the spirit].

Persohn agrees that the practice lends his store street cred. “It’s cool that we have out-of-state customers,” he says. “But what’s even better is to offer a single-barrel bottle, which many people view as a premium, for the same price.” He goes on to explain that standard Buffalo Trace, Eagle Rare, and Elijah Craig aren’t offered as single barrels, which makes private bottlings such as Hi-Time’s branded offerings the only way to get such products. “When we pick barrels ourselves, by default those bottles are single barrel,” he says. “And we don’t upcharge for that.” As an example, Persohn points to an off-the-shelf version of Whistle Pig—a 10-year-aged, 80-proof Rye whiskey—and compares it with Hi-Time’s custom bottling of Whistle Pig barrel-proof (114-proof) single-barrel whiskey, which is also aged 10 years. Both are sold at the same price, giving the limited-edition, higher-proof, single-barrel version an edge on perceived value.

The final benefit? “Once in a while,” says Persohn, “I get lucky and travel to the distillery.”

Smaller liquor stores take caution: Committing to an entire barrel is expensive. It’s not that the practice itself is more expensive; it’s the quantity that’s different. Costs vary; Colvin has spent from $5,000 to $14,000, but Crestodina claims single barrels can reach $20,000 easily. “Unless you’re confident you can sell them quickly,” says Colvin, “it can be difficult to justify the upfront expenditure.”

How does it work, exactly? Some buyers travel to the distillery to taste barrel samples, but more often they taste samples in the store, often with staff—or even customers. (Colvin has just launched the CoolVines Barrel Club, in which customers join the private barrel sample tastings.) To get those samples, distilleries can reach out to stores and vice versa. In general, though, local distributors organize the process and keep it running smoothly—and legally.

As far as the legal aspect goes, it’s pretty straightforward, as long as the product and label are registered with the state. “The only time I’ve ever seen trouble is when you try to cross-collaborate between industries,” says Colvin, explaining that friends tried to create a cider/beer blend. “The local liquor authority had no idea how to classify it.”

Once a private barrel is selected, the turnaround to receive it can be quick, says Colvin. But if a distillery is backlogged, it could take two to three months. “One of our most recent picks,” he says, “took six months from our choosing it to its actually hitting our shelves.”

Now that liquor stores are bottling their own barrel picks, what’s next? “I see it happening a lot more in bars and restaurants,” says Persohn, citing Seven Grand in downtown Los Angeles, which dedicates an entire page of its drinks menu to its 14 private barrels, including collaborations with Four Roses and Wild Turkey.

“I think the next frontier is going to be private label beer and spirits that are truly custom,” says Colvin. “We also have a whiskey collaboration in the works,” he says, “but I don’t want to divulge too much info on that until everything is finalized.”

Gina Hamadey is the former travel editor at Food & Wine and Rachael Ray Every Day and the author of the cookbook¡Buenos Nachos! As the founder of Penknife Media, Inc., she leads content strategy for food and travel brands.

Most Recent