Monday, April 09, 2012

Anchor Distilling Looks To Expand With Artisanal Focus

(by Shanken News Daily) San Francisco-based Anchor Distilling is aiming to become a one-stop artisanal spirits shop for independent-minded bars and restaurants in the United States. With a portfolio of 35 craft spirits suppliers, Anchor’s volume grew by 30% last year. Anchor president David King says the company expects to outpace that performance this year, growing to around 70,000 cases.

Anchor Distilling is the spirits arm of Anchor Brewers & Distillers, created in 2010 when former Skyy vodka executives Tony Foglio and Keith Greggor purchased Anchor Brewing from home-appliance heir Fritz Maytag and combined it with their existing marketing company, Preiss Imports. Foglio serves as chairman of the group, while Greggor is CEO. London drinks merchant and marketer Berry Bros. & Rudd also holds a significant minority stake in Anchor.

Included in Anchor Distilling’s portfolio are Berry Bros.-owned brands like No. 3 Gin, The King’s Ginger Liqueur, Pink Pigeon rum and, most recently, the Glenrothes single malt, which Anchor will begin marketing in the United States on May 1. (Glenrothes was previously handled by Campari America.) Anchor-owned brands like Old Potrero American whiskey and Junipero gin are also part of the mix, as are agency labels like Chinaco Tequila, Luxardo liqueurs, Hirsch Bourbon and the BenRiach and GlenDronach single malts.

“Our whisk(e)y portfolio is up nearly 40% year on year, and there are huge opportunities,” says King, a Berry Bros. veteran. “Glenrothes is a 10,000-case brand—the largest in our portfolio but still tiny in the context of the U.S. market. It’s about 12% of our total sales, so it will be a key part of our whisk(e)y stable but won’t dominate the portfolio.” Anchor prefers to use a “range” or “category”-oriented strategy rather than pushing individual brands, because its customers tend to be less brand-centric than the industry at large, King says. Along with its whisk(e)y brands, No. 3 Gin and Luxardo, particularly its Maraschino cherry variant, have been among its growth drivers.

“I think the big spirits brands will continue to do well off-premise,” King says. “But in the urban on-premise people are often seeking an experience that’s more difficult to replicate at home. In cities like New York, Chicago and San Francisco, there are lots of new bars and restaurants popping up that don’t stock the big brands. So our specialty is selling into those ‘craft’ accounts.”

Anchor intends to continue extending its brand list to serve the increasingly adventurous on-premise consumer. “We can handle a few more suppliers, and we’re on the lookout,” King says, adding that entry into new spirits categories is likely. “I think Mezcal is an interesting area. With its smoky note, it can be like the Islay single malt of Tequila,” he says. “And, despite being partially owned by two former Skyy executives, we don’t have a vodka. I also think there’s potential around smaller producers of Cognac and Armagnac as the economy continues to recover.”

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