If you’ve seen Mike Morales’ article on the Top 20 Craft Tequilas you’ve overlooked then you’ll understand that picking one (or even 10) from this list is like picking your favorite child. It’s too difficult to do, so your best bet is to vote twice a day for your favorites and spend the rest of your time sipping all of them.
Congratulations to all the nominees. If Mike could pick a top 50 list, it still wouldn’t be enough. Thank you to all the wonderful brands out there who are constantly striving to produce the finest tequilas they can. We love you all!
In order to be called tequila, this spirit distilled from the juices blue agave must be made in specific regions of Mexico, most prominently Jalisco and the town of tequila. While no tequilas are produced in the United States, we want to find the best craft tequila brands available in the country, and to do so, we asked a pair of tequila experts to nominate their favorites. Unlike other spirits, tequila brands often share distilleries – there are about 70 of them producing more than 500 brands – so it’s often the brand rather than the distillery that indicates quality. Many of these 20 nominees for best craft tequila brand use traditional methods. Many of the brand owners grow their own agave and personally oversee the entire tequila-making process. All produce high-quality, distinctive tequilas available in the U.S. market. Vote for your favorite once per day until voting ends on Monday, September 12 at noon ET. Read the official Readers’ Choice rules here.
[An urgent text message about Kosher tequilas from an agave beverage manager at a thriving new bar in New York City, and the resulting questions raised from research into this misunderstood market from all points–tequila and mezcal brand owners, consumers, and rabbinical representatives of the Jewish faith–prompted me to finally discuss the positive, often flawed, and vastly under served kosher tequila and mezcal segments of the market.]
A Rant on Kosher Tequila…
For years, anyone who’s ever searched for a current list of kosher tequilas has no doubt been directed to the website of the largest regional Jewish Orthodox organization in North America, the Chicago Rabbinical Council (cRc).
Those same persons were tragically disheartened by the woefully meager list of kosher tequilas–and these days–unmentioned mezcals. And of the brands that were listed, more often than not, were now, sadly, extinct.
This old, outdated, and unreliable list is not only supposed to be a guide to fully enjoy and appreciate the Jewish holidays and to help “keep kosher” year round, but it also serves Muslims, Seventh Day Adventists, Vegetarians, Vegans and even people who are lactose or glucose intolerant.
What Exactly Is Kosher, Anyway?
For us gentiles (non-Jews), Kashrut is the set of Jewish religious dietary laws. Food that may be consumed according tohalakha(Jewish law) is deemedkosher meaning fit, and in this case, fit for eating or drinking.
In every case, approved products are given a hechsher, a rabbinical seal of approval, by a trusted and reputable kosher certifying agency that signifies the food or drink conforms to Jewish law.
Historically, the practice of marking food as kashrut dates back as far as the Byzantine period (6th century CE) where Jews of a particular region in Israel stamped their bread dough with impressions of the Jewish Temple Menorah in order for consumers to verify its kashrut.
In 1911, soap manufacturer, Procter & Gamblebecame the first company to advertise a new product, Crisco, as kosher. Over the next twenty years, companies with household names like Lender’s Bagels,Maxwell House, and Manischewitz grew the kosher market. And who can forget that famous slogan for Hebrew Nationalhotdogs?–“We answer to a Higher Authority.”
Decades later, kosher has come to symbolize both quality and value. It has also become a very lucrative market according Menachem Lubinsky, founder of the annual two-day Kosherfesttrade fair. As of 2015, he estimates there are as many as14 millionkosher consumers that generate $40 billionin sales of kosher products in the US alone.
Other sources estimate that over $150 billion of kosher-certified products are consumed every year in the US.
Kosher Certifying Agencies
Akosher certification agencyis an organization that bestows ahechsher to ingredients, packaged foods, beverages, and certain materials, as well as food-service providers and facilities in which kosher food is prepared or served. This certification verifies that the ingredients, production methods, and/or food-service processes and utensils complies with the standards ofkashrut.
To be certified requires periodic onsite visits, sometimes unannounced, by mashgichim (rabbinic field representatives) in order to verify ongoing compliance.
Today, the largest kosher certification agencies in the United States, known as the “Big Five,” certify more than 80 percent of the kosher food sold domestically. These five agencies are: theOU,OK,Kof-K,Star-K, and cRc
Other respected kosher certifying agencies around the globe include:
EarthKosherbased in Colorado, the logo of both theJohannesburg/Cape TownBeth Din used in South Africa, MK headquartered inMontreal, Canada, and The Kashrut Authority in Sydney, Australia. Operating across six continents including the United Kingdom, KLBD, based in London, is the Kashrut Division of the London Beth Din.
By far, the greatest number of agencies seems to be in the USA.
Kashrus Magazine publishes a bi-annual guide to almost all kosher certifying agencies worldwide. As with the tequila NOM lists, the number of agencies, just like the number of tequila brands and distilleries, fluctuates from year to year. At press time, this number is between 1,151 to 1,253.
When In Mexico…
In Mexico and throughout Latin America, however, KA-Kosher and Kosher Maguen David (KMD) rule the roost when it comes to certifying products as kosher.
“El sello KA KOSHER es el único en México aprobado por el Tribunal Rabínico de Israel. Es el logo de la Comunidad Ashkenazí, el único en Latinoamérica aprobado por el Alto Tribunal Rabínico de Israel. Bajo su sello se encuentran marcas como Nestlé, JUMEX, Del Monte, LALA y casi 500 empresas más.”
(“The KA-KOSHER seal is the only one in Mexico approved by the Rabbinical Tribunal of Israel [Chief Rabbinate Council of Israel]. It is the logo of the Ashkenazi community, the only one in Latin America approved by the High Rabbinical Tribunal of Israel [again, Chief Rabbinate Council of Israel]. Beneath its seal are such brands as Nestlé, JUMEX, Del Monte, LALA and almost 500 more companies.”)
KMD’s current website makes even bolder claims such as “Es la empresa líder en certificación kosher en Latinoamérica” (“The leading company in kosher certification in Latin America.”).
It also cites statistics that Mexico is the fourth largest kosher market behind Israel, the United States, and France, and that sales of kosher products, presumably in these countries, exceeds non-kosher sales by 20 percent. KMD also states that 80 percent of kosher sales are to non-Jewish consumers.
KMD, stems from the Sephardic community of Jews and is known to follow the strictest codes and standards of kashrut, referred to as Mehadrin.
Similar to organic certifying agencies, having your tequila or mezcal brand approved as kosher requires that you hire one of these kosher certifying agencies. Like buying a car, you don’t necessarily need to purchase one from a local dealership.
You can go anywhere in the world, but with so many certifying agencies and what seems like varying degrees of inspection, can you feel confident about purchasing their services?
Who Do You Trust?
If you’re a tequila or mezcal brand owner considering certification, we’ll offer some tips and steps you can take in Part 2.
As Tequila Aficionado Media first reported in November of 2001, and shared with you again from our vault in the summer of 2015, tenth generation glassmaker Georg J. Riedel presented the perfect tequila tasting glass–the Riedel Ouverture Tequila Glass–at an exclusive ceremony in one of Mexico’s most renowned luxury hotels.
The introduction of the Riedel Ouverture Tequila Glass would serve to elevate the image of tequila from a beverage strictly consumed in shots to an elegant spirit worthy of sipping and savoring.
Originally designed for reposados in mind, the Riedel Ouverture Tequila Glass over the years has been revered by the likes of Master Distiller Germán González as a valuable tasting and nosing tool, and reviled by others as an inadequate vessel to judge the nuances and characteristics of agave spirits.
Many in the industry have questioned why separate glassware hasn’t been produced for each of the agave growing regions, much like the wine and spirits regions of Bordeaux and Cognac. Tasting and nosing glasses for Atotonilco, Amatitán, Arandas, el valle de Tequila (Tequila Valley), and all points in between should be represented with their own custom stemware.
With all the talk about terroir in tequila and mezcal these days, using proper glassware to discern specific regional characteristics of top notch juice is vitally important.
But, which glasses are the right ones? What else is out there?
Join Tequila Aficionado Media right here on our website on Sunday, November 22, 2015 at 9PM CST when founder, Alex Perez and CEO, Mike Morales blab about other viable options in tequila and mezcal glassware with Martin Duffy, the exclusive representative of the famed Glencairn Chrystal in the US.
On the eve of the 14th anniversary of the introduction of the Tequila Glass, discover other alternatives in glassware to enhance your enjoyment of tequila, mezcal and all agave spirits.
Originally published on TequilaAficionado.com Dec 3, 2006
In a relationship that the Animal Planet calls symbiotic–like the small fish feeding on scraps from a shark’s jaws, or birds picking the bugs off a hippo’s butt–Cuervo has benefited nicely over the years by partnering with major restaurant chains all over the US. They have single-handedly influenced thousands of tequila drinkers.
The Lonely Bull
In an informative article in the Los Angeles Daily News last December, Staff Writer Brent Hopkins recounted the humble beginnings of one of the oldest Mexican food restaurant chains in Southern California.
El Torito--which also celebrated its golden anniversary in December 2004–was the brain-child of ex-fighter pilot Larry Cano, whom Brent describes as having “…a few recipes and knowledge of an exotic sounding foreign drink known as tequila….”
In the late ’70’s and early ’80’s, it was the ultimate place to eat, drink, and party. I’ll admit, I was among those who enjoyed traditional Mexican food with more than one margarita and a round of shots.
According to the article, El Torito grew into an international powerhouse with restaurants as far away as Turkey and Abu Dhabi. After many changes in ownership, it has been streamlined to a manageable 69 locations.
El Torito has now begun to focus on its cuisine, but one look at the menu–which we’ll do shortly–tells you that that’s not the only thing management is emphasizing.
In a relationship that the Animal Planet calls symbiotic–like the small fish feeding on scraps from a shark’s jaws, or birds picking the bugs off a hippo’s butt–Cuervo has benefited nicely over the years by partnering with major restaurant chains all over the US. They have single-handedly influenced thousands of tequila drinkers.
Where other tequila houses like El Tesoro de Don Felipe and Cazadores visit bars and restaurants around the country, Cuervo’s version of a grass roots campaign is a little bit different.
In Part I, I promised a glimpse at Cuervo’s La Rojeña distillery, but first, more about me….
I had just moved to New Mexico from Southern California. My first job was in Customer Service with one of the largest paper, food, and chemical distributors in the state. Starting at the bottom, I figured the quickest way to becoming a darling of the company–a route salesman–was getting to know the old dogs.
Before my arrival to this company, one other product that it sold was liquor. When the family-owned operation sold out, half the sales force morphed into one of the two major liquor distributors in New Mexico. Those that stayed with the food and chemical division longed for the good ol’ days.
At one of the quarterly meetings’ mandatory dinners, 25 raucous salesmen (and a few of us from Customer Service) ran up a $3000 bar bill on the company’s credit card! During a round of Cuervo Gold shots is where I heard it first.
“This reminds me of the time at Jose Cuervo,” said one salesman.
“What a party that was!” agreed another.
Simultaneously, they described the beauty of the facilities, the grounds, and the tequila at Jose Cuervo’s La Rojeña distillery.
The hospitality at these Cuervo “education” junkets is legendary. Mariachis, food, and all the tequila you can drink. Not to mention a generous spiff to each salesman for every caseload sold, or every new account acquired.
“We used to send two delivery trucks a week to every territory,” lamented another salesman. “One with food, and the other full of booze!”
Ah, the good ol’ days!
Many tequila distilleries graciously open their doors to tequila aficionados. Corralejo, La Cofradia (Casa Noble), and Herradura’s Tequila Express, a train that takes turistas to their distillery, to name just a few. But no one does it better–or did it first–than Jose Cuervo.
From Applebee’s (The Perfect Margarita made with 1800), to here in Albuquerque, New Mexico with the Garduños chain of Mexican restaurants (with locations in Arizona and Las Vegas, too), to the popular El Torito. Wherever you live, in every major or minor market in America, there is sure to be a restaurant chain–or liquor supplier to that restaurant chain–that has fallen under the spell of La Rojeña.
To understand how deeply Jose Cuervo is entrenched in El Torito’s menu, you have to be aware of the “rules of engagement.” It’s called “the three tier system,” and it’s the key to the final segment of this series, so heads-up!
In order for a tequila producer–or any spirits producer, for that matter–to get his product to the US, he has to use an importer (Tier One). This importer is in charge of spreading the word to as many spirits distributors–state and national–as possible (Tier Two). Once distribution is secured, their sales forces are responsible for getting the product to their consumers–every bar and restaurant they service (Tier Three).
Like a computer virus, Cuervo can be found everywhere along these three tiers. At one time or another, every importer, distributor, and chain of bars or restaurants has been invited to enjoy the pleasures of tequila at La Rojeña.
Unfortunately, unlike wines, spirits, by US law, cannot be sold directly to the end user (you and me) by the producer. Let’s drown our sorrows over that one, shall we…?
On every table is a simple, hand-sized brown three ring binder. A painting of a jimador harvesting a blue agave–that looks coincidentally like a well-known photo taken at one of the Cuervo agave fields–shares the cover with the El Torito logo, a lonely bull, and the word auténtico. Desserts and drinks in one little package, all made with Jose Cuervo products.
There’s the classic Cadillac Margarita with a side of Grand Marnier. You can order this signature drink in different colors like Green (Midori Melon), Pink (cranberry juice), and Red (Rémy Red).
The Blue Mesa Margarita with 1800 and Blue Curacao. The Real Mex Margarita with Tradicional. And a series of popular tequinis with names like Buenas Noches and Agave Tequini.
To be fair, El Torito serves other very respectable blanco, reposado and añejo tequilas like…
Sauza Tres Generaciones…Don Eduardo…Chinaco…Corralejo…Herradura…Cazadores…and Quita Penas. Along with the Cuervo standard bearers, Gran Centenario, Reserva de La Familia, and even Don Julio (suspiciously missing from Cuervo’s Taberna del Tequila menu in the previous segment).
You can even wash down your dinner, drinks and dessert with a cup of Mexican coffee made with Tradicional and Kahlúa.
Each of the signature drinks is very reasonably priced from just over $5 to a bit under $7. Shots range from $5.25 to $10.50.
Although their menu tries to give equal time to other tequilas, when you check the bar, there’s no mistaking who’s on display…
In the final segment, I’ll take a look at where the marketing future of Jose Cuervo is headed. Here’s a hint…
You’ll be surprised to learn that it has nothing to do with tequila! Instead, it’s slick, high-tech, and chances are good that you already own one. And with it, Cuervo conquers the mystery of the missing “fourth tier.”
Few spirits I’ve tasted—tequila or otherwise—grabbed my attention the way Casa Noble Joven did when I tasted it at the distillery two years ago. Traveling with a press group led by the distillery’s CEO, Pepe Hermosillo, we’d consumed multiple expressions of Casa Noble while there. But this one, packing a 104 proof punch, was simply electrifying.
Not because it was hot or a peppery-boozy tongue lasher, but because at nearly still strength and without any aging, the tequila told the story of the agave from which it came better than any I’d had at that point in my life.
A couple of my peers didn’t agree. They weren’t comfortable with the proof and said Joven overpowered their palates. I thought privately, “You’re missing out! Try it again and get used to it!”
Drinking this way is part of life where I come from in Louisville, Ky. That’s Bourbon Country, where high-proof spirits are preferred by many because that’s where the flavors are. Sure, it takes practice to nose and sip such rocket fuel correctly, but it’s worth it when you taste George T. Stagg 141 proof or a barrel-strength Four Roses.
But Casa Noble Joven didn’t demand such patience. It was—to my palate—immediately drinkable after a few swirls in the glass. Instead of a burn, it felt as if slightly carbonated, a delightful buzzing sensation.
The nose was abundantly fragrant: floral, tropical-fruity and loaded with heaps of roasted agave. It may still be the most inviting tequila I’ve ever nosed. The flavor was lush, laden with sweet agua miel, spicy white pepper and highlands agave minerality. Unlike some of my colleagues, I wanted more and received it in a generous pour from Hermosillo, who smiled in approval.
Two days later, at a tequila dinner in Louisville attended by Hermosillo, I met a liquor store owner who’d bought an entire barrel for his store and was having it bottled. I had to have one. Once acquired, I rationed it out slowly and carefully, treasuring it.
Don’t miss this part: That turned out unnecessary when I made a cocktail with it. Here’s why. Even though I love Joven straight, my standard 2-ounce pour of tequila (any spirit) took over the drink, not the desired effect. Next time I used 1.5 ounces and it was perfect. I’d never had a better margarita.
But wasn’t it too costly at $50 a bottle to use in a cocktail?
Not at 1.5 ounces per pour. When I did the math, I figured out that using Joven to make the ultimate margarita (scratch sour mix only) was actually less expensive than pouring 2 ouncees of Casa Noble’s 80 proof Crystal. Crystal is an exceedingly fine blanco, but its younger brother is even better.
Cannot recommend this one highly enough—if you can find it.
About Steve Coomes
Tequila Aficionado is proud to welcome rising star in tequila and travel journalism, Stephen Coomes, as a Contributing Writer and Reviewer. His steady gigs include roles as contributing editor for Nation’s Restaurant News (the U.S. restaurant industry’s largest publication), restaurant critic and feature writer for Louisville magazine, feature writer for Edible Louisville and Seafood Business magazines, Kentucky travel and dining contributor for Southern Living, and dining blogger for Insider Louisville. He also writes marketing, PR, web copy and ghostwrites for numerous private clients. You can visit Steve online at www.stevecoomes.com.
On a frigid and damp Saturday night in November 2013, Roger Clyne, along with his band The Peacemakers, invited Tequila Aficionado Media to an intimate concert and tequila tasting at Billy’s Ice House in New Braunfels, TX, to talk music, heritage, and his tequila, Mexican Moonshine.
Hey, gringos, it could be worse…we did not get there first
The Colt Single Action Army, also known as the Peacemaker, is considered a famous part of Americana. “The Gun That Won the West” was wielded by such action-oriented historical legends of the late 19th and early 20th centuries as Buffalo Bill Cody, Theodore Roosevelt, Judge Roy Bean, Pat Garrett and General George Patton. It has also been the selected sidearm of Hollywood movies, preferred by everyone from John Wayne to Clint Eastwood in every single Dirty Harry film. And in 2011, it was declared the official firearm of the state of Arizona. Arizona is also home to another piece of Americana–a guts and guitar driven, reggae and mariachi laced, roots based rock-n-roll band leyenda known as Roger Clyne & The Peacemakers. Armed with expressive lyrics, evocative melodies and four part harmonies, these straight shooters have come to redefine the indie music landscape by being the first band to debut six consecutive albums in the Top Ten of Billboard Magazine’s Internet Sales chart. Along the way, Clyne has gathered a burgeoning cult following that rivals that of Sammy Hagar and Jimmy Buffet–both themselves very successful tequila front men.
I fell under the spell when I stumbled over the line…
Many aficionados roll their eyes when news of another celebrity endorsed tequila hits the liquor store shelves. But Roger Clyne came upon his admiration for agave spirits early in life as part of his Southwestern ranching heritage, predating even his love for writing music and performing.
Roger was first introduced to scotch as a teenager by his grandfather who would pour him a dram to “put hair on your chest.” The taste of “dirty socks in mud” was tough to swallow, but it was his father’s sharing of bacanora, another agave distillate, that opened him up to the wonders of Mexican spirits, and in particular, tequila. Like most of us, Clyne cut his teeth by shooting cheap mixto tequila in college, then swearing off of it until the next opportunity to overindulge. He was well into his studies (psychology and anthropology) at Arizona State University when he rediscovered that “bright, wonderful, elegant, lyrical taste” of tequila during an exchange program in Ensenada, Mexico, while following a troop of mariachis.
It’s surreal, sublime, manmade and divine…it’s the moonshine….
Roger Clyne’s Mexican Moonshine tequila was born in true outlaw fashion in 2004 during the famed Circus Mexicus music festival that takes place annually in Puerto Peñasco, Mexico (Rocky Point, for you ex-pats).
After that initial experience, Roger began scouting for factories to produce Mexican Moonshine, a journey that would even take him to the famed La Cofradía distillery (NOM 1137), the home of Casa Noble and Montejima tequilas.
He finally selected Fabrica de Tequilas Finos (NOM 1472) and forged a relationship with the distillery owner, Federico Cabo, and Master Distiller, Arturo Fuentes. Together, the team first “dropped” Mexican Moonshine reposado onto the market in 2010, even though Clyne was advised against such commercial suicide due to historically poor sales of this expression.
Soak in the silvery light spillin’ out tonight from the moonshine…
In this clip, Roger pours and discusses Mexican Moonshine silver…
We’ll get a fine flow flowin’, a good glow goin’…
Believing that a reposado is the more definitive expression of tequila, Clyne was surprised when Master Distiller, Arturo Fuentes suggested that Mexican Moonshine be aged in Kentucky bourbon barrels. Here, Roger explains further.
I got a healin’ home-brewed remedy, a low-brow therapy…
A Gold Medal winner at the San Francisco World Spirits Competition in 2014, Mexican Moonshine añejo was released in 2013 and is fast becoming Roger Clyne’s favorite expression, much to his chagrin. In the following snippet, Roger breaks down its flavor profile.
On April 29, 2014, Roger Clyne & The Peacemakers will unleash their seventh studio album, The Independent. The title fits these musical mavericks like an old pair of faded jeans worn as a statement against oppression on Casual Fridays. Yet, as Clyne states, “There’s something about our music that celebrates what’s uniting versus what’s dividing.”
Using this “Tequila Logic,” Roger Clyne has managed to do the same with Mexican Moonshine, gently hitching the spirit’s Lowland agave heritage to the wood notes of Kentucky bourbon to create a peacemaker that rightfully belongs in any collector’s arsenal.
Mexican Moonshine, Mexican Moonshine…Let your heart and your cup overflow, under the glow of the moonshine! May your heart and your cup… Overflow…under the glow of theMoonshine!
Tequila Brands and Producers Have Already Sailed Into the Sucker Hole
For those new to the expression, a “sucker hole” is a colloquial term referring to a spate of good weather that “suckers” sailors into leaving port just in time for a storm to resume at full force and wreak havoc on the ship and crew.
For both Tequila Brand Owners and producers of a certain size, their ship has already sailed, and the storm is now closing in on them. Some in denial, others looking through rose-colored margarita glasses, still believe they can navigate through to that glimmer of light on the horizon. However, the perfect storm of doom looms just past the horizon of hope, and will soon envelope and destroy most, if not all, in its wake.
Oh, and that’s the good news. The bad news is that only a few of the big and the very nimble will survive.
This is because of a number of factors, primarily that too many of us bought in to the Yankelovich and similar studies that declared premium and above 100% Agave Tequila brands as the next big thing.
While the premises of these market premonitions were undoubtedly true, too many of us jumped headfirst into the juice just before the world economic decline. Six hundred brands have turned into 1200 brands in less than five years. The growth of the market has been dramatic compared with other distilled spirits, yet, it’s still relatively small, ranked only 4th in US volume. It has not grown fast enough to accommodate all of the entries into the field.
Resistance is Futile – Change is at Hand for the Tequila Market
The Gravy Train Wreck Ahead
I’m sure that for many of you, in just reading the title of this article, your blood pressure has escalated, and you may already be misdirecting your anger at the author.
For others who have experienced the many similar economic paths to consolidation in the global beverage industry, you have already accepted that change has to occur, and you will soon better understand and appreciate the math behind what I am about to lay out, and why everything I’m about to outline here will happen in due course.
For those of you who have your personal fortunes riding on the Tequila Train, both prominence and profit may still seem to be so close that you think you can see the light at the end of the tunnel, or beyond the next bend. But, I’m sorry to say that for most of us in the biz, the light at the end of the tunnel is that of an oncoming locomotive. This will be a catastrophic collision, albeit in slow motion, that will drain your resources and your resolve.
What can be learned from the Russians? (Excerpted from JustDrinks.com)
The global economic crisis has had a significant impact on the Russian spirits market, changing market dynamics and briefly halting the much-lauded premiumisation trend, according to current research.
A recently released report from the International Wine and Spirit Research (IWSR) on Russia’s spirits market claims that the downturn has also led to “…disruptions across the supply chain, with many suppliers and distributors going bankrupt or halting production. For healthier companies, however, it has presented an opening to establish their brands and take market share…”
The Silver Tequila Clouds have a very Dark Lining (Excerpted from Global market review of Tequila – forecasts to 2013 www.researchandmarkets.com )
The history of the Tequila industry has been one of boom and bust. Sales rose during the 1940’s only to collapse again in the mid-50’s. Export sales rose steadily from the 1960’s onward, although domestic sales fell sharply in the 1980’s due again to an economic slump, and the severe Mexican economic crisis of the early 1980’s resulted in plummeting sales.
The market was again disrupted by a critical shortage of Agave beginning in the late ’90’s, which served to hold back the category’s international development as brand owners were forced to divert limited supplies to the core US market, and quality perceptions were damaged as some manufacturers moved from 100% to 51% (Mixto) Agave products.
Today, that dynamic is in reverse, and the market is in oversupply. More and more 100% Agave products are coming into the market. This is helping to raise quality perceptions, and in turn, demand is surging not only in core Mexican and US markets but across a number of other countries.
The outlook for the category has rarely been better, and Casa Noble Tequila president and COO David Ravandi commented, “Tequila is entering a stage of consolidation in the world markets. It is no longer a fad. The fact that 100% Agave Tequila exports have increased tremendously over the last two years is extremely positive for the product’s outlook in the years to come.”
US Tequila Importation is a Sucker Bet
“My cousin will make the best Tequila for you Mr. Gringo”
“So, my friend, you want a great Tequila brand? We will make it for you. Just fifty percent cash up front to start the process.”
Unfortunately, far too many have fallen for this old gag. Relying heavily on the forecasting reports of the early 2000’s that suggested that luxury Tequila would be the next big spirits category after vodka.
With dollar signs in their eyes, the believers drank the Tequila Kool-Aid, most of them spending way too much to buy a brand, custom molded bottles, etc. But the worst part was that this left little if any money for marketing. Many did not even understand brand marketing inflation was happening right under their noses.
It had started soon after Patron hit 100,000 cases in volume in 2001, and the cost to market a Tequila brand in the US went from $1 to $10M per year. Today it takes at least $20M per year just to play in the same ballpark as Patron’s $50M plus, Sauza’s $35M plus, and Cuervo’s $30M plus marketing budgets.
Who could have predicted that a “realistic” business plan for the next successful ultra-premium Tequila brand calling for only 10,000 cases in the first year would end in it’s investors taking a bath?
The problem with this equation is three-fold:
1) Pricing: Unlike vodka and white rum, 100% Agave Tequila is just too expensive to produce and bottle in Mexico. Unless, like rum, vodka and mixto Tequila, it is able to be shipped in bulk and bottled near the final consumer, the cost involved with 100% Agave Tequila is always going to be too high to attain critical volume and profit levels.
2) Volume: US mass volumes are best when a spirits category is between $9.99-29.99/750ml. One hundred percent Agave Tequila is currently profitable only at the upper ranges when higher volumes are attained.
3) Distribution: The US “3-Tier” Distribution System is at best an oligopoly, and 19 states run a monopoly. Of the 1200 plus Tequila brands, want to guess how many they want to carry? Well, after the top 20, you are very lucky to be “special order only”. If you are fortunate enough to live in the states of California or Arizona, where one can be both the importer and distributor, you will find yourself driving your precious Tequila brand around to each account in your car.
Without product volumes or market clout, you will be hard pressed to get even an appointment, let alone a vender number with the chain restaurants and grocery stores. These major chain stores like Chili’s, Chevy’s, Costco, Kroger, etc., drive at least 85% of the combined volume in all but the control states. Without access to the chains, your market becomes the handful of privately owned, “Mom & Pop” accounts that usually know that small independent distributors are easy prey for bending the law on consignment, stringing out payments, or not paying at all.
While driving your own brand around certainly makes time for the personal touch and focus, these hand-selling efforts prove to be the most inefficient ways to distribute one Tequila brand. Your glass ceiling to fame and fortune becomes that next level of chain distribution that can only be had by a state-wide delivery system of the large wholesale distributor.
With Tequila segment Pricing, Volume and Distribution all against you, one will need to have a lot more money than the brands of the past in order to simply survive in the US.
Tanks-a-lot for Nothing
Call the tank maker and raise your stocks of liquid now!
Unfortunately, most of the mid-sized Tequila distilleries have bought into the notion that Agave prices will go up in the very near future. They base this notion on the boom and bust cycle of the past, and like Lehman Brothers, believe that they have successfully timed the market.
Greedily, many producers are now mortgaged to the hilt in order to produce all the Tequila that they possibly can afford to store in stainless tanks or wooden barrels. Fear of the impending Agave price increase that has yet to happen (and may not for many, many years) has seemingly forced them all into a squirrel-like stockpiling frenzy.
Are they storing Blanco, like acorns, for the hard winter ahead? These stored nuts of liquid demise are in reality winds conspiring to produce the perfect storm for all but the most financially secure and/or nimble producers.
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The continuation of Podcast #2, this is Tequila Aficionado Founder, Alex Perez, and CEO, M.A. “Mike” Morales meeting face-to-face for the first time. They met in July of 2006 at a restaurant in California and tasted Siembra Azul, Dos Lunas and Jarro Viejo tequilas.
The continuation of Podcast #2, this is Tequila Aficionado Founder, Alex Perez, and CEO, M.A. “Mike” Morales meeting face-to-face for the first time. They met in July of 2006 at a restaurant in California and tasted Siembra Azul, Dos Lunas and Jarro Viejo tequilas. Their conversation begins with a discussion of Jose “Pepe” Hermosillo of Casa Noble.
The continuation of Podcast #2, this is Tequila Aficionado Founder, Alex Perez, and CEO, M.A. “Mike” Morales meeting face-to-face for the first time. They met in July of 2006 at a restaurant in California and tasted Siembra Azul, Dos Lunas and Jarro Viejo tequilas. Their conversation spanned everything from established tequila families, drinking from the barrel, traveling to Jalisco, resoling boots and more!