Does Islay need more distilleries?
Commercial Spirits Intelligence No.50
As people who have worked in and around the spirits industry for many years, we found that there was a lack of good, public, research on the trends in the spirits industry. Whether it’s trends in wood, or distillery capacity, or M&A activity - many of the existing research providers speak to a specific niche when we wanted a whole-market analysis. In this newsletter we leverage our experience, contacts and market intel to provide meaningful analysis that speaks to relevant issues for you. This newsletter is a collaboration between Duncan McFadzean of Noble & Co, and Martin Purvis. If you find this newsletter valuable, please consider a paid subscription.
Does Islay need any more distilleries?
Executive Summary
The recent news flow from Islay got us interested in the Island and its position within Scotch whisky. Whisky has been made in Islay for hundreds of years, but we now see a plethora of new operations coming to fruition. The volume of single malt sales ex-Islay has remained steady for the last few years and blended whisky may struggle to absorb all of the spare spirit. It is a remote place to make whisky and the island is creaking under the weight of the supply chain, whisky tourism, and normal day-to-day life. We see the new developments as all about the long term (as always in Scotch). Brand building and leveraging the island's mythical status with some whisky lovers will help build new product sales in the long term. Does this cannibalise other similar brands and where does all the spare liquid go? Only time will tell but good brands will develop, grow, and sustain over the long view. The entrepreneurial whisky spirit is alive and well in Islay and we watch with great interest to see how everything evolves.