It is early morning on the parade ground, and steam issues from the army gathered there. A solemn silence blankets the scene.
Across the field, a voice calls out. “Attention!” The assembled microshiners close ranks and stand tall, chests out, backs straight. They know the gravity of what is to come, how near it strikes to their own hearts. It fills them with a multitude of feelings: shame, envy, anxiety, pride. They consider how they will respond if ever they face a similar temptation, question their own motivations. Is it worth the sacrifice? Why did they join this army to begin with.
Then the drummer begins to play. Rogue’s March. On the far right of the formation, Bill Owens steps out, the dismissed by his side. David Perkins of High West Distillery. Drummed out of the corps.
They begin the walk. Across the front of the formation, past the set faces of former comrades. Their eyes are hard, intent on the horizon. The drum punctuates every step.
From right to left, past the whole of the formation, the delinquent is marched, and thence to the center of the parade. His coat is turned inside out.
The drum stops. Silence descends.
“About face!” The army of microshiners turn away from him as one. “Forward march!”
In the recorded history of alcohol consumption in America, the amount of alcohol consumed has essentially remained constant, somewhere around 2 gallons per capita. What this means is that there is a limit to demand, and thus, a limit to supply. For a given population, there can only be so much alcohol produced. The only question is how, and by who.
So sitting here reading about Constellation Brands Inc.'s acquisition of High West Distillery in the Wall Street Journal, I can’t help but thinking that this math just doesn’t work out. If every so-called craft distillery plans to scale and exit, then this movement was a moot point. We’re right back to where we started from.
The thing I always come back to is, for at least a third of us, you’re missing the message. The reason craft is growing, and by craft I mean independently owned and micro in scale, is because a significant segment of the population is trying to enact a new economic paradigm, not because your personal expression is particularly intriguing. We are trying to put a face to our commodities. We have seen what the centralized corporate model has to offer, and we’re saying, thanks, but no. I’d rather buy my booze from Ryan Montgomery, who puts on a killer motorcycle show for Fathers’ Day and whose kid I see each year at the Ravalli County Fair.
No two ways about it, David and Steve at Clear Creek and others like them have made out nicely. They have hit the sweet spot, this time when the rise of craft has the Bigs nervous enough to think they need to buy into the game but before they realize it’s a losing battle and really a lost cause. I won’t bore you with all the details on why that’s true, save to say that if owning a network of small producers distributed across the landscape provided the same profit margin as operating a single centralized facility, well, then that’s the system we would see in place already.
The sad thing is, all Constellation bought themselves was a little time and a customer base who were, for the most part, already theirs to begin with. Because what Constellation and Pernod and the rest don’t get is that they simply cannot buy into craft. All they can do is try to stay ahead of the bleeding.
Which is great for David, and unfortunate for anyone who appreciated the notion of High West being a local distillery.
