International Expansion Forces Bourbon Maker to Reduce Quality

When your product becomes internationally demanded and you can’t supply this demand, you could find yourself in a rock and hard place - either lessen the quality to increase supply or maintain quality to satisfy your domestic consumers. Beam Inc. a company that makes Maker’s Mark, a high quality American bourbon has decided to lessen the potency of their popular liquor. “Maker’s Mark waters down its bourbon to meet rising demand” by Zachary M. Seward of qz.com (Quartz) reports “The bourbon brand, known for its bottles sealed with red wax, told customers today that it’s reducing the amount of alcohol in the beverage in order to meet rising global demand”.

Beam Inc. sent an email to “loyal customers” (email is in the article) and stated the alcohol by volume (ABV) will be reduced by 3%. American bourbon has become steadily popular over the past years – in “the United States, [it] accounts for 35% of all spirit sales”; however, international demand is the motivation behind lowering the ABV. The article reports, “International growth is what’s driving demand for bourbon makers like Beam Inc…. Beam executives earlier this month said Australia, Germany, and Japan were strong markets”.

The reduction leaves Maker’s Mark at 42% ABV. The company is expecting backlash for the reduction as they “reached out to its ‘ambassadors’” to handle the situation. I don’t drink bourbon but from my understanding, high quality bourbon is appreciated for it’s “time-honored and precise recipes”. Like any other product loved for it’s quality, ingredients/material, and the consistent presentation, changing the product could anger very loyal customers.  Is this “biting the hand that feeds you”?

Whether one agrees with the decision, this is the reality of business owners internationally expanding. The more new customers love your product, it could be very costly to keep up with demand while maintaining the original quality. I don’t know of many companies that would stunt their growth.  But businesses are about making money and expanding, albeit the bourbon has become a little less strong.