Since the beginning of the Covid-19 pandemic in 2020, the spirits business took a big hit in on-premise sales due to nationwide bar and restaurant closures and restrictions. However, whiskey sales have surged back and increased significantly in 2021, according to an industry report. It’s a good sign for the U.S. spirits market.
On Thursday, the Distilled Spirits Council of the United States released a report stating that the spirits industry is recuperating. While it hasn’t reached pre-pandemic sales numbers quite yet, all signs point to recovery.
On-premise sales in bars and restaurants make up around 20% of the nation’s market for spirits. Compared to 2020, on-premise sales increased by 53% in 2021 as businesses welcomed customers back across the country. That’s still 14% down from sales in 2019 before the Covid-19 pandemic began, but industry experts are encouraged that things are heading in the right direction.
In fact, American whiskey producers had another solid year of sales growth. The report shared that combined US sales of bourbon, Tennessee whiskey, and rye whiskey reached $4.6 billion in 2021. That’s an increase of 6.7%, or $288 million, the council reported. In America alone, whiskey sales increased by 29.7 million cases, which is a domestic volume increase of 4.5%.
Whiskey connoisseurs continue to drive business while creating an increased demand for the spirits. Last year, premium brand sales of bourbon, Tennessee whiskey, and rye surged by 15.6%. Distilled Spirits Council president and CEO Chris Swonger spoke about the record sales in 2021.
“Last year, enthusiasm for spirits continued as consumers spent more to elevate their cocktail experiences with super-premium brands,” Swonger explained in the council’s report. “Consumers savoring spirits at home and trading up to higher-end brands, combined with the gradual reopening of bars and restaurants, resulted in record sales for the spirits sector. We’re also seeing strong growth for spirits-based ready-to-drink products, and that’s adding to our sector’s gains as well.”
Whiskey Isn’t the Only Spirit to Have A Volume Increase In 2021
As 2021 came to a close, overall supplier sales of spirits had increased by 12% to $35.8 billion. That equalled an increase in volume by 9.3%, which totaled more than 291 million cases last year.
In addition to American whiskey sales surging, Irish whiskey had an almost 18% volume growth in 2021. Yet tequila had the largest growth since it made up almost one-third of 2021’s increase in spirits revenue, according to the council’s report.
As the pandemic swept the nation in 2020, sales of off-premise spirits began to surge as well. Since patrons couldn’t enjoy their favorite spirits in bars and restaurants, liquor store and retail outlet sales shot up. The sales increase pinpointed a rise in the consumption of mixed drinks at home during the Covid-19 pandemic. Further, off-premise sales volumes increased 19% compared to pre-Covid numbers in 2019, the council reported.
Many bars and restaurants also joined the trend of at-home spirits during the pandemic by offering cocktails to-go. Spirits available to take home became another way for establishments to make money during Covid restricted in-house service. The take-home policy is now permanent in 16 states, and 14 other states have legally extended the cocktails to-go offerings. Eight states also passed legislation to allow home delivery of spirits as well.
While the spirits industry hasn’t fully recovered just yet, promising whiskey and tequila sales show things are getting back to normal for suppliers and consumers. Cheers to that indeed.