The premium liquor market has seen a steady increase in mergers and acquisitions recently, a trend that is expected to continue according to industry experts. Potential buyers see opportunities for sales growth. One of the fastest growing segments, premium tequila just witnessed one of the largest sales in recent history. The Casamigos brand sold for a higher price than analysts had predicted at a price of $700 million up front with $300 million in incentives based on performance over the next 10 years by brand giant Diageo. Even though the price was higher than expected, the sale came as no surprised to analysts who have indicated that the growth in the U.S. tequila market has been almost exclusively aimed in the super premium segment. Global sales of tequila have now reached 292 million liters in 2016 and are projected to continue to grow to over 335 million liters over the next 5 years. Interestingly, the U.S. accounts for roughly half of global sales volume for tequila and the growth rate here in the U.S. has exceeded the rest of the world by over 2.5 percent (8.6% vs. 6% respectively). The spirits market as a whole has been shifting its focus to the higher tiers of spirits in recent years where margins tend to be greater and there are a limited number of major players to compete against.

Source: BeverageDaily, July 2017

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