Buffalo Trace Addresses Inventory Shortages

Bourbon is a hot product at the moment.  Long readily available brands are now becoming scarce on store shelves.  Buffalo Trace Distillery put out a statement addressing it’s supply shortages:

FRANKFORT, FRANKLIN COUNTY, KY (May 8, 2014) The bourbon boom shows no signs of letting up. At Buffalo Trace, the 228-year-old Distillery continues to take steps to mitigate the problem, but shortages still remain. About a year ago, Buffalo Trace Distillery warned consumers a shortage was looming, but many markets across the nation are just now feeling the full effects.

“We’re making more bourbon every day. In fact, we’re distilling more than we have in last 40 years,” said Harlen Wheatley, master distiller. “Still, it’s hard to keep up. Although we have more bourbon than last year when we first announced the rolling blackouts, we’re still short and there is no way to predict when supply will catch up with demand.”

Along with increased production, adding more bottling lines and hiring more people, Buffalo Trace has also hired a full-time barrel allocation manager, just as the company intended last year. The new allocation manager will balance bourbon inventory with sales volume. Monthly allocations will ensure all markets get some Buffalo Trace, Eagle Rare, and Blanton’s every month, preventing long periods of time when these brands are unavailable.

“We taste, approve and bottle what barrels we have available each month. There are shortages, because Buffalo Trace, Eagle Rare, and Blanton’s sell out quickly, but no shortage should last more than one month before reinforcements arrive,” said Kris Comstock, bourbon marketing director. “We’re asking for continued patience from our fans. The recent surge in demand is quite flattering, but we just need to keep in mind these bourbons were put into the barrel many years ago.”

Comstock added that other highly allocated whiskeys such as Pappy Van Winkle and the Antique Collection will continue to be released annually every fall.

Despite the increase in distillation over the past few years, bourbon demand still outpaces supply. The overall bourbon category is experiencing 5% growth, but premium brands are up nearly 20% from last year. Bourbon must be matured in new oak barrels and Buffalo Trace ages many of its barrels for eight to ten years, and some over two decades. That’s a long time to wait for a bottle of bourbon. Not to mention, with the amount of bourbon lost to evaporation over time, barrels are half empty after ten years. The increase in sales, coupled with the aging process and evaporation loss, leads to a shortage with no end in sight.

I’ve seen shortages of Blanton’s, WL Weller 12 Year and Eagle Rare.  They’re gone as soon as they hit the shelves.  Buffalo Trace isn’t the only distillery facing this problem.  I hear Heaven Hill is halting it’s single barrel program.  It’ll be interesting to see how this shortage of supply resolves itself.  Will it result in stricter allocations?  Higher prices?  Time will tell.

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