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Bourbon

Bourbon . Logan Ballew David Hill. Industry Overview. Total alcohol sales in the U.S. is $59.24 billion Bourbon is responsible for $3.8 billion in sales Jack Daniels is the market leader accounting for $1.32 billion in sales ( www.insiderlouisville.com ) . Audit Overview. 128 SKUs

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Bourbon

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  1. Bourbon Logan Ballew David Hill

  2. Industry Overview • Total alcohol sales in the U.S. is $59.24 billion • Bourbon is responsible for $3.8 billion in sales • Jack Daniels is the market leader accounting for $1.32 billion in sales (www.insiderlouisville.com)

  3. Audit Overview • 128 SKUs • Around 60 SKUs per retailer. • Smallest Store 48 SKUs (Adams) • Largest Store 72 SKUs (Popatop) • In the stores audited there were 0 private label SKUs • Less SKUs than 2011, more depth. • Assumption = Smaller Stores

  4. Audit Overview • Prevalent Brands • Jack Daniels • Jim Beam • Evan Williams • Maker’s Mark • Wild Turkey

  5. Demographics

  6. Demographics

  7. Main Market • Higher income • Older, generally 55+ (changing) • Not a significant difference in demographics between brands

  8. Category Role • We believe a destination role is appropriate • Goal = Build traffic and be the primary category provider • Purchase cycle average = 30ish days

  9. Strength of Leading Competitors • Total sales, brand loyalty, and brand familiarity drives the high stocking rate for these brands • These 5 dominant brands can be found nearly everywhere • .

  10. Gross Margins • High gross margins of over 45% on all leading brands • Consistent with a destination role because of higher gross margin and turnover • Higher gross margin = more depth.

  11. Private Label • There is no PL presence in the stores we audited in the Bourbon category • Our assumption is that PL will continue to lack presence in the Bourbon market because retailers are attracted to the current high gross margins in national brands • Total bourbon sales are hardly affected by the state of the economy • We assume that if private label were introduced, it could target the lower income demographic • We would not suggest retailers start carrying private label because of already high gross margins of national brands.

  12. Questions?

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