Why Distilleries Sometimes Do Sell Casks
There’s a parenthesised ‘usually’ in the title of this piece. There are, in fact, circumstances in which it is possible to get casks directly from distilleries. It’s a pretty uncommon phenomenon, though. For the sake of completeness – let’s take a look at these rare events to start with.
Are there any benefits that a distillery might get from selling some of their casks directly? The answer changes depending on the age of the distillery.
The Uncertainty of Youth
Younger distilleries have a difficult job when they first begin making their whisky. New to the world and eager to make their mark, they have many older brothers and sisters to live up to and differentiate themselves from. They need to get an expensive and technical operation running smoothly, producing new spirit that can’t be sold as whisky for at least three years (practically, many more), and growing battalions of loyal fans.
There are many years of waiting until their whiskies are matured to the stage when they are ready to bottle, which translates to many years of uncertain income for a young distillery.
We visited Edinburgh’s newest distilleries Holyrood and Bonnington (Crabbie’s) to learn how they’re bringing distilling back to Edinburgh. In fact, Holyrood even got its own video.
In many cases, such distilleries do indeed opt to sell their casks to private owners very early into the maturation. Though a young cask isn’t yet as valuable as an older expression, the quick injection of money can be crucial to a young distillery’s survival – and is far more attractive than a business loan. What’s more, the distillery can generate massive goodwill and an adoring audience of loyal fans by allowing people to get involved with their whisky directly.
Such cask programs are not typically very flexible in what they allow customers to do with the cask, and the maturation time tends to be fixed.
For older distilleries, the picture is different – their whisky is already established in the market, and they have many decades of history and warehouses full of aged stock to support them. Their renowned whiskies have avid fans the world over, so their most straightforward pathway to profit is in bottling their whiskies under their own marque.
Nonetheless, even the old guard distilleries are sometimes in a position to sell casks. There could be casks that become available because they don’t fit neatly into a distillery’s release schedule. More commonly, an older distillery may release mature casks of whisky that don’t quite correspond to the brand’s idea of itself.
For example, a whisky brand might be particularly well known for releasing sherry-matured or sherry-finished expressions. What, then, if the distillery had filled some ex-bourbon hogsheads 25 years ago? It isn’t appropriate for the distillery’s mainline releases, but an independent bottler or a private buyer might be delighted to obtain an unique cask from a famous distillery, an alternative to the expected. It’s not something that gets widely announced to the general public, however.
Distilleries often have alternative ‘trade names’ that they sell their casks under, in order to keep their brand consistent. To become an expert on the privileged world of secret alter-egos of Scotland’s distilleries, read this entry here.
So, Why Don’t They (Usually) Sell Casks?
It seems advantageous for a distillery to sell casks, so how come they don’t do it very often? A good number of reasons.
It’s Worth Most in a Bottle
Forgive me for simplifying economics to the point where even I can understand it.
In any supply chain, the final price paid by the consumer will be the highest. Raw materials sell for less than refined materials. Refined materials sell for less than a finished product.
Distilleries like to put their whisky in bottles, knowing that the finished product is their biggest earner. They also have the whole chain in place to take raw materials all the way to whisky. Grain to glass, barley to bottle, aqua natura to aqua vitae (sorry).
There can be cases where the volume of whisky is greater than the capacity to bottle it, and in these cases selling a cask makes a lot of sense – but by and large, distilleries will want to sell as much of their output in a decorative bottle of their own design as possible.
They Have Blending Contracts
Despite the meteoric rise of Single Malt in recent decades, blended Scotch whisky is still a huge and healthy part of the market. Many distilleries release their own single malts very rarely because the lion’s share of their production (and indeed their raison d’être ) is centred around producing Scotland’s famous blends. The needs of blending houses may vary with time, and predictions may not always align, so there will always be casks that don’t quite fit the schedule – and these are good candidates for sale to the well connected.
Brand Consistency is Important
If a distillery holds on to its whisky right up until bottling, then it has full control over exactly what goes into bottles and what those bottles look like. This guarantee is lost once their cask finds its way to different owners, who could re-rack the cask, blend it, or release a bottle with an unexpected design.
Different distilleries have differing levels of zeal with how much they demand from third party use of their casks. Some simply won’t sell casks at all. Others require certain naming restrictions on third-party bottles of their whisky or use alternative names for casks they do sell. Still others don’t have restrictions. This is a complex and changing landscape, and one that we at Cask 88 have become adept at navigating – and this is wisdom we’re willing to share.
But Mostly…It’s Kind of Inconvenient
The three points above give reasons for why cask sales by distilleries are limited, but they clearly still do happen – at least, within the industry. A private buyer looking for just a single cask has (aside from a few extremely limited cask programs) no way to engage in business directly with a distillery. And the keywords there are ‘single cask’.
Distilleries are making whisky and filling casks on a large scale – even the smallest distillery produces tens of thousands of litres per year. The big players can have a flow rate of millions of litres. They simply don’t operate on the scale of the individual.
Outside of an often rigorously formulaic cask program, the level of administration required to cater to the needs of individual passionate whisky devotees is considerable. Catering for individual desires is often tough. Everyone has their own ideas about how they’d like their whisky to be matured, how often they’d like to visit and sample their cask. When the time comes for bottling, there’s a plethora of design ideas for bottles which pose individual challenges from both a design and a logistic point of view. What’s more, distillery warehouses are usually not public-facing beyond the scope of the official tour route.
Distilleries are highly specialised into the art of making whisky, they would need to set up new dedicated teams of customer support, warehouse logistics and designers to cater for the passionate whisky fans queuing up to buy one or two casks for their own projects. It’s a little beyond what a distillery wants to do…
The Role for Cask 88
… and that’s where we step in. We are set up and specialised to fit that niche between distilleries and individual cask buyers. We are the aforementioned team, and we work across all distilleries rather than just for one. When we approach a distillery on the hunt for casks, we’re able to do it at a scale that the distillery is willing to work with. Simultaneously, we have a dedicated sales team who cultivate personal relationships with our customers, able to offer a selection of individually unobtainable casks for individual purchase. Our design team can be engaged to turn those casks into collections of beautiful and unique bottles.
We’re network builders and forgers of connections – we can expertly source unique and bespoke selections of casks, tailored to the desires of each of our customers. We take very seriously our responsibility as guardians over the casks while they are stored with us, which includes trying to get personal cask visits and cask tastings to their owners as much as we can. We are also respectful of the original distillery’s desire for their whisky to be treated with reverence, while also offering our customers the opportunity to own and create whisky that really represents them.
So, while distilleries sometimes sell casks, Cask 88 always do. To schedule a consultation with our team, and find a cask that’s perfect for you, simply click here.