Many companies have succeeded by investing in Scotch. The top distillery is Diageo, headquartered in West London. Formerly called Distillers Company, it started in the early 20th century. Before it experienced success, though, it overcame many setbacks. In 1960, the company suffered financially when it branched out into pharmaceuticals by introducing a morning sickness drug that ended up causing various birth defects in babies. During this decade, there was a decline in the price of whiskey. However, in 1980, a group of businessmen hired by Guinness & Co. (another brewery) saw the potential of reviving the company. Today, with plans to acquire a controlling share in White and MacKay as well as United Distillers of India, its market may expand to about 40% from the present 35%. Diageo owns the popular Smirnoff Vodka, Gordon Gin, Johnny Walker, and J & B.
Aside from Scottish whiskey, Irish whiskey has also made its mark on the industry. One success story is that of Ireland’s most successful whiskey product, Jameson, which is owned by Irish Distillers, who have greatly contributed to the local economy. Irish Distillers joined Pernod Ricard in 1988 and Jameson then led the transformation of the Irish whiskey class. Due to its continued growth globally, Pernod Ricard invested £200 million in Jameson’s production facilities in Ireland in 2010. It expanded its distillery and doubled production to 60 million litres of alcohol a year. In 2012, the company hit its high point by selling four million cases globally. In fact, it was awarded the Whiskey Brand Innovator of the Year and the Whiskey Distiller of the Year at the Icons of Whiskey Awards in 2012. A year earlier, it received four Double Gold and one Gold medal at the San Francisco World Spirit Competition. The commitment, focus, and energy of the company’s employees are considered a large part of their recipe for success.
Investors advise those who want to start in this kind of business to begin by collecting limited edition and uncommon types of whiskey. Usually you can buy these from a distillery that has closed. Since they go out of stock fast, you have to be quick when placing orders. You can also buy them from other collectors through auctions. From the time you buy a bottle, you would already know its potential for investment and how much you could sell it for in coming years.
Store your bottles of whiskey in a dark place at a constant temperature. A pantry is fine as long as you cover them with a black cloth. Make sure the bottles are stored in an upright position to keep the corks intact.
Investing in whiskey requires a minimum of two to five years to pay off. Just like with any other investment, though, it is worth the wait. Investing long-term (10 to 20 years) is best because of higher returns.
The Future of
The auction market for whiskey is at $5.7 million and projected to soar to a value of more than $69 million by the year 2020, which amounts to 175,000 bottles a year. International Wine and Spirit Research considers it a strong possibility that whisky consumption will increase by 12% between 2012 and 2016.
A closed bottle of whiskey can still be consumed after 100 years, making it last longer than wine and other liquor. It is a long-term investment and each bottle could theoretically gain value over the course of 100 years or more.