W&W Irish Whiskey Brochure 08.22 (1) - Flipbook - Page 9
Why distilleries need investors
There are two key strategies that distilleries commonly
adopt to accommodate this high upfront cost and remain
profitable during the whiskey maturation period:
New make spirit needs to be matured for at least
three years before it can be called Irish whiskey.
Maturing whiskey is a capital intensive business.
By selling a percentage of their yearly production,
distilleries can cover their operating costs, allowing
them to lay down the remaining percentage for
their own brands whilst enjoying a mutually
beneficial business relationship.
10
8
Strategy One:
Borrowing
Strategy Two:
Wholesale selling
Traditional borrowing
from banks is an option
chosen by some distilleries.
However, this strategy
exposes distilleries to the
risk of market fluctuations
and lending limitations.
This is when distilleries sell casks at
wholesale rates to a whiskey bonder or broker.
This model is used with a certain amount
of their whiskey production to ensure a
consistent revenue stream.
Many new distilleries have
already borrowed capital
to cover set-up costs and
do not want to take on
any more debt during the
process of maturation.
This is where Whiskey & Wealth
Club comes in.
We contractually agree a price to buy large
quantities of this new make spirit straight off
the stills. This provides the distillery with the
funds they need to operate. We then add our
small profit margin. The whiskey is put in
first-fill, A-grade, American oak barrels, stored
in a bonded warehouse, and fully insured for five
years against fire, theft, accidental damage and
spoilage, making it a full turnkey opportunity.
9
