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Distillers Industry Profile Excerpt
| SIC Codes: 2085 NAICS Codes: 31214 Page Length: 10-12 Last Quarterly Update: 6/30/2008 View Sample Industry Profile |
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The distillery industry includes about 80 companies with combined annual revenue of $6 billion. Major US companies include Brown-Foreman, Beam Global Spirits & Wine, Barton Brands, and Heaven Hill Distilleries. The industry is concentrated: the top 25 companies account for 90 percent of industry revenue.
The industry includes businesses that distill, blend, or mix liquors. Some businesses distill alcohol onsite; others take neutral spirits and infuse alcohol with flavoring agents. Businesses not included in this industry include brandy or non-potable alcohol manufacturers, companies that market bottled liquors made elsewhere, and US subsidiaries of multinational corporations.
COMPETITIVE LANDSCAPE
Demand is driven primarily by trends in alcohol consumption and personal income. The profitability of individual companies depends on efficient operations and strong distribution channels. Large companies have advantages in brand recognition and economies of scale. Small operations can compete effectively by specializing in high-end or unusual spirits. Average annual revenue per employee is about $1 million.
US distilleries compete against wine and beer producers for share of consumer alcohol spending, and with global spirits companies such as Diageo, Bacardi, and Pernod Ricard.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major products include whiskey and bourbon (30 percent of industry revenues); vodka (10 percent); cordials and liqueurs (10 percent); bottled cocktails (10 percent); gin (5 percent); and distillers dried grains used for animal feed (5 percent). Other products include unflavored (neutral) spirits and unclassified or specialty liquors.
Making liquor involves six steps: mashing, fermenting, distilling, ...
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