Friday, March 1, 2024

How To Invest In Tequila

What Kind Of Return Can I Expect From Creating My Own Tequila

How To invest in A Liquor Company

Read Time: 4 min.

Launching a tequila brand is a major enterprise. Its exciting, its high-prestige, and there is incredible potential for success. The ultra-premium tequila market is booming right now, and with a focused marketing strategy and a strong brand, there is a lot of potential.

But even so, its important to know what you can realistically expect from your investment. Knowing the market, the industry, and where your money is going is critical to planning and forecasting. You might discover new product potential that you hadnt considered before, and perhaps even a few adjacent niches that could help to strengthen your brand, both in Mexico and your target markets.

Respect For Tradition Meets Passion For Innovation

Made with skill, art, and passion, AsomBroso Tequila is inventive while honoring the long-standing traditional methods. This exceptional brand has been awarded prestigious accolades in the distilled spirits industry and is recognized as an ultra-premium tequila.

Ricardo Gamarra, the creator of AsomBroso Tequila, has accomplished many firsts in tequila history. He was the first to market a pink hued, Bordeaux rested reposado, the first to rest a 5-year añejo in new French oak barrels, and the first to rest extra aged añejo tequila 11-years in a new French oak barrel. His highest achievement today, The Collaboration, is a stunning 12-year double barrel rested tequila combining his awarded Vintage 11-year Extra Añejo with the esteemed Silver Oak Cellars Cabernet Sauvignon American oak barrels for an additional 13 months. This produced one of the worlds most luxurious and taste provoking tequila in the world and achieved a 97 Rating, making it the highest rated tequila in the world.

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The Vision

What To Mix With Tequila

Tequila enthusiasts often differ on the best way to drink the Mexican spirit. Whether you prefer your tequila neat, shot with lime, in a Margarita, or enjoyed on the beach, its a spirit thats easy to enjoy in many situations. For an elevated version of the classic margarita, try Tommys Margarita Recipe. For something spicy, mix up a Spicy Blood Orange Margarita. Or if you love tropical flavors, try the Blue Agave Sour.

Recommended Reading: Who Is The Owner Of Don Julio Tequila

Know Your Niche Market

It doesnt matter how amazing your product is it wont sell unless youre approaching it the right way. You cant sell ice cubes to polar bears. Your niche market holds the key to your success. Knowing your ideal customer and what speaks to them is essential if you want to rise above the competition.

Once you have identified your market, you must dive deeply into trends and statistics to see whats possible. You need a well-crafted marketing plan and a brand that connects, not only with your customers needs but the needs of the market itself.

Diageo To Invest $500 Million In Tequila Production In Mexico

How to Invest in Liquor

Farmers, also known as jimadores, harvest blue agave on a plantation in Tequila, Jalisco, Mexico, April 13, 2018. REUTERS/Carlos Jasso/File Photo

MEXICO CITY, Sept 30 – British beverage company Diageo said on Thursday it will invest $500 million to increase its tequila production capacity in Mexico and help it meet local and international demand for the alcoholic beverage.

The president of Diageo for Latin America and the Caribbean, Alvaro Cardenas, said the company will begin to build the company’s third local manufacturing in the La Barca municipality of the western state of Jalisco.

“We’re going to have an investment of more than $500 million dollars to expand our operations here,” said Cardenas at an event in Jalisco.

“It is the most significant investment we have made in Latin America and the Caribbean in the last 10 years,” he added.

Also Check: Who Is The Owner Of Don Julio Tequila

Profitable Sin Stocks: A Fallacy

There is a common theory that investing in sin stocks will always be profitable. That’s because there’s a belief that the for certain products like cigarettes and alcohol never dies down. The idea is bolstered even further by the notion that people tend to drink and smoke excessively when the stock market tankslikely out of frustrationfurther boosting sales of sin stocks. There is some truth to this. These goods are considered consumer staplesproducts people may continue to buy even when the economy is weak. Demand for consumer staples tend to be non-cyclical, meaning consumer demand is consistent all year long. But, there’s always an exception to every rule, and this theory has many cracks.

Alcohol may also considered by some to be a luxury good, and therefore, part of consumers’ discretionary spending. Depending on someone’s personal circumstances, they may decide to stop buying their weekly bottles of wine or beer, or stop going to the local bar if they can’t afford it. That’s probably why the stocks of both Diageo and Constellation Brands performed relatively poorly during the 2008 financial crisis. After all, in down economies, investors seldom rush to buy alcohol stocks.

Investors seldom rush to buy alcohol stocks when the economy weakens.

Merits Of Quality Tequila

When starting a new investment, it is always best to familiarize yourself with the major details surrounding the business or sector you are investing in, investing in liquor and specifically tequila, is no different. The first step in investing in tequila is being able to understand the difference between what can truly be considered tequila and what cannot be.

All tequilas come down to being mezcals, that is both tequila and mezcal are derived from the class of plants called agaves. But here is the important distinction to be made for would be tequila investors to not miss out on. True tequila is only distilled from the blue agave plant that is native to only certain places in Mexico. Certain regions in Mexico have the correct altitude and soil makeup in order to provide the necessary qualities in creating tequila. These areas include Nayarit, Michoacan, Tamaulipas, Guanajauto, and Jalisco. The reason to remember these names is because the majority of any quality investment worthy tequila will hail from one of these five regions of Mexico.

Different Tequila Distinction:

  • Gold Tequila, also considered mixtos are not made purely of 100 percent blue agave. These types of tequila are not aged before being bottled.
  • Silver tequila is a clear type of tequila that is one hundred percent made out of blue agave. It also goes without aging, but some creators will let the silver tequila sit in the casks for a couple weeks.
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    Integrated Beverage Developer Vs Other Options

    An integrated beverage developer is hands-on through every process. They will take the time to get to know you and your brand first which is a huge differentiator, especially compared to a distiller house option.

    Distiller houses focus more on white-label brands. They sell you a finished product that you have no part in developing, and their business model often results in hidden costs. For example, you may pay for extra bottles not filled and extra liquid if you were short bottles. You may also pay for tequila wasted in the bottling process something you would not have to worry about when working with Aceves.

    In this business model, you are left to manage every process, from marketing to logistics and everything in-between. Your distiller simply supplies the product, and the rest is in your hands. While this might be an option if you are a big company with the bandwidth and experience to handle it all, its not an ideal situation for small boutique brands or anybody entering the tequila market for the first time.

    You Will Need To Be Detail

    Investment in alcohol industry on ice

    Bloggers, aficionados, early adopters, and some members of the media will want unique production details. Have them.

    Mezcal producers have done a great job of listing production details on their labels, and now there is an expectation that tequila producers will offer the same level of transparency. This is also a great way to highlight how your product is different and unique.

    Heres a word of advice from us : Know how your product was made and be able to explain how yours is different. If you cant get us excited about it, its probably because theres nothing new about it. If it tastes like everything else made at that distillery, we wont need to try it. We already know.

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    The Search For A Tequila Distillery Is Not Easy

    If you dont have your own distillery, you need a partner. This can be complicated, especially if you dont speak Spanish. According to the Tequila Matchmaker distillery database, there are currently 135 active tequila distilleries in Mexico. Finding the right one is not easy because each distillery is unique.

    Youll need to start by doing your homework. Which distilleries are capable of producing the flavor profile you are interested in? You can start your research by scanning through our tequila distillery rankings to get an idea of the overall quality of the tequila they are producing, based on ratings from Tequila Matchmaker app users.

    Once you find one you like, will they even give you the time of day? Not all distilleries are willing to white label their product.

    And the distillery owners we know who make great, traditionally-produced small batch tequilas are few, and cautious when taking on new brands. This is for a good reason: they have to be worth the time and effort because their reputation is also at stake.

    I want to know that has the right motivation and a partnership with them will be sustainable, says Salvador Rosales, Jr. of Tequila Cascahuín. His family distillery gets a lot of interest from would-be brand owners, but their small-batch, artisanal approach means they have to be very selective.

    Are you ready to be a good partner?

    Celebrity Investment & Endorsement

    There is a reason that there are a lot of celebrities getting involved with the tequila industry. Some of these people include Sean Combs, Carlos Santana and a slew of other public figures. The reason being is that the high end market for tequila is a growing industry. Between 2009 and 2015 sales for tequila in the United States increased at a compound rate of nearly 5.5 percent a year. What helped increase this was the new line of tequilas being produced by many different celebrities. This was due to there being premium growth sales. This type of increased growth is making big named investors get interested in a market that is considered an alternative type of investment, which gives some added validity and stability for alternative investors now. For investors looking to put some money into stocks here, there are a few good options.

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    How To Find The Right Partner To Create Your Own Tequila Brand

    Read Time: 4 min.

    The success of any business venture hinges on the experts you surround yourself with. As an entrepreneur launching a new brand, you have a lot of things to think about. When you work with the right partner, it removes the stress and allows you to focus on what you do best marketing and selling your product.

    How To Visit Jalisco The Capital Of Tequila

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    Read Time: 6 min.

    Whether youre a casual tequila drinker or serious investor considering starting your own tequila brand, you probably already know that Mexico is the mecca for agave-based spirits. And if youre particularly savvy about tequila culture, you may also know that Los Altos de Jalisco hosts the biggest and most successful brands in the industry.

    With its rich soil full of nutrients, ideal climate for year-round growth, and vast heritage of Mexican tequila growers, Jalisco boasts all the perfect conditions for agave harvesting and tequila production. If you havent seen this stunning spot for yourself yet, heres why and how you should come for a visit.

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    Know Your Target Market

    The tequila market isnt an easy industry to get into , and you need to properly understand what youre getting into before starting your own brand. There are thousands of tequila distilleries and agave growers in the industry, and youll quickly learn that there are plenty of unsavory companies waiting to pounce on those who dont fully understand the industry theyre getting

    into. After sorting through suppliers, you also need to look at your target market. With the steep increase of popularity of the tequila industry, there are thousands of brands creating tequilas of varying qualities. You need to know what your ideal customer is looking for in a spirit and how you can create something people actually want.

    Add A Little Tequila Cheer To The Holidays: Paqus Gift Giving Guide

    Does your choice of glass affect how your tequila tastes? If you ask the glass experts at Riedel, the fine crystal glass manufacturer from Austria best known for its glassware designed to enhance different types of wines, the answer is a resounding yes! Like their wine glasses, their spirits glasses are uniquely designed to bring out the best of that particular type of spirit, showcasing the aromatics and flavor characteristics of that liquid, while minimizing the bite of alcohol.

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    Yves Saint Laurent To Mark 60th Anniversary At Six Paris Museums

    Just a day after debuting her 818 tequila brand, Jenner is being faced with accusations of cultural appropriation, as many social media users pointed out that the model has no ties to Mexican culture. Jenner has yet to comment on the backlash.

    Jenners tequila venture comes after she made her first foray into the beauty world in 2019 by investing in oral-care brand, Moon. Jenner worked with Beach House Group, a Los Angeles-based brand incubator, to develop the direct-to-consumer luxury oral-care brand. The model also filed a trademark for her own beauty brand that same year, but hasnt revealed plans to launch a brand.

    Read more here:

    You Need To Get Into The Weeds On Tequila Production Processes

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    If you want to create a quality product, you will have to learn how tequila is made, how to taste and evaluate it, and understand the profile you want and what is required to achieve it. This takes time and at least one patient tequilero willing to take you under their wing. Otherwise, you could end up being taken advantage of.

    A jaded note here: Sweet and smooth are overplayed. Added vanilla is, too. Beware of additives Taste everything, from popular mass-market brands to small producers. Ask questions, such as Why does this tequila have more agave in it than others? Whats the difference in the process and the agaves used?

    Every brand will start with some sample runs, and knowing what you are tasting and what you like will be essential.

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    Tequila Private Brand Benefits And Disadvantages

    Starting a private label tequila company is a huge step to take, and its not without its own benefits and disadvantages.

    The difference between a private label and a private brand is entirely the customization requested.

    A private label is a good option to start with because it requires less order quantity but delivers a certain level of customization. A private brand is fully customized but requires a minimum order quantity and a larger investment.

    If you already have experience in the industry, and you want to start big. Before you take the leap to creating your own tequila, here are a few things to keep in mind:

    What Does This Mean For George Clooney

    Clooney and partners will stay on with Casamigos even after it moves to Diageo. The actor will remain the focus of the liquors marketing, which helped Casamigos sell millions of bottles. If the marketing drives more sales, hell end up $100 million or so richer in a decade. For now, Clooney will take home at least a couple hundred million dollars when the deal closes.

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    Tequila Brand Owner Accused Of Illegally Raising $1 Million From Investors

    The Department of Justice alleges he even lied about tequila being destroyed in a hurricane.

    Investing in a tequila company certainly has its allures. Celebrities from Snoop Dogg to Sammy Hagar have tied their names to alcoholic beverages, and in the case of George Clooney, the already wealthy A-list actor famously netted himself a nine-figure payday when he sold his Casamigos tequila brand. That said, not all of us have Clooney-esque star powerso instead, the Department of Justice alleges that the owner of the New York-based tequila brand Six Degree used a different method to drum up investors: fraud.

    Joseph Cimino was arrested last week and charged with one count each of securities fraud and wire fraud, both of which carry a maximum sentence of 20 years in prison. “Joseph Cimino allegedly raised nearly $1 million in investor funds for his start-up tequila company by lying about the company’s finances, and then spent a significant portion of that money to finance his own lifestyle,” U.S. Attorney Audrey Strauss said in announcing the arrest. “Now Cimino faces the sobering reality of federal securities and wire fraud charges.”

    Finally, in probably the most egregious allegation levied against Cimino, the DoJ says that, in 2017, he told investors that the company would be reimbursed for 800 cases of tequila destroyed in Puerto Rico during Hurricane Maria, when in fact, “the Tequila Company had no insurance and none of its inventory had been destroyed in the hurricane.”

    Pairing Food With Tequila: Tips Tricks + Our Faves

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    Does your choice of glass affect how your tequila tastes? If you ask the glass experts at Riedel, the fine crystal glass manufacturer from Austria best known for its glassware designed to enhance different types of wines, the answer is a resounding yes! Like their wine glasses, their spirits glasses are uniquely designed to bring out the best of that particular type of spirit, showcasing the aromatics and flavor characteristics of that liquid, while minimizing the bite of alcohol.

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