Let’s go way back in time…

Long before the abstract concept of currency came into play, mankind had to determine standards for exchanging goods and services. Our collective past has shown us that we as a species used to be much more diversified in terms of our skillsets. We had to know how to fulfill our basic needs and, further, how to maintain them indefinitely. As a simple example, does not every man out there have a dad that seems to know just a little more than he does about home maintenance? Fixing a car? Raising a family without a handbook or the internet at his disposal?

In those early days we also learned that there was strength and security in numbers. Civilizations came together. Skills became much more specialized. Division of labour took on new dimensions. Not everyone had to be able to make bread…or forge tools…or work stone…what-have-you. Instead, man was wise enough to realize that he could rely on his brother (or sister) to provide something that he himself was not quite as adept at making or doing. So long as he had something to offer his brother (or sister) in return, that is. This became a quid pro quo system (or a “you scratch my back, I’ll scratch yours” scenario). Brilliant. Initially, at least. Until societies expanded to the point where it simply wasn’t feasible to have the ‘specialists’ swapping favors all the time, or until your neighbour had something you desperately needed, but perhaps had nothing to offer in return.

So what came next? Why, the advent of the monetary system, of course. Value ascribed to tangible commodities (precious resources initially, then to coins and paper in a more abstract promissory capacity). This allowed for a rather faceless economic system to develop. You no longer had to rely on the trust and reputation of your mates to do business. Instead you could trade a hard value to a perfect stranger in order to enact a transaction. It all sounds a little cold when worded as such, but so be it.

Granted, this is all very simplified, and occasionally anthropologically contested, but that’s sort of the gist of it.

Now, why do I bring up trust and the handover of value from one to another here? It’s simple, really.

Like it or not, we whisky geeks have built a relationship with our brands, our distillers, our ambassadors and our spirit sellers. On the consumer side we’ve done our due diligence by buying the products, attending the events and sharing the good word via social media (and otherwise). We’ve done so to date because we were able to work off a long-developed understanding of value. We knew it took substantial initial investment and a huge outlay of cash on the part of the distilleries in order to first create the product. We knew there was overhead and other expenses such as labour, utilities, facility maintenance, leases or mortgages, shareholders, tariffs, etc. We knew there was a not inconsiderable delayed return on investment due to the necessary maturation times of the spirit, and inherent warehousing costs. We also knew that beyond all of this there were bottling, labeling, transport, marketing and other such expenses. Fair enough.

Our willingness to lay out our hard-earned money for a fine bottle of Scotch, produced by working men and women in one of the most beautiful places on earth, was based on an acceptance that Scotch whisky exemplified class, elegance, tradition, history, time and beauty. We could pick up a bottle and contemplate in awe that the spirit in our hands had taken 18 years to make. 18! Amazing. We could marvel that the world was a much different place when the whisky we held was distilled and left to sleep the seasons away on a dirt floor somewhere in the rolling hills or along the rocky coasts of Scotland. And because we knew what had gone into that bottle, we were ok with paying what the sticker on the shelf asked of us.

We’ve now moved forward a few steps down the road from those times. The prices that are staring us in the face from those shelves have doubled or even trebled in the past few years. We’ve watched the fluctuation in markets that have relationships with the whisky industry (grains, fuels, currencies, etc) and acknowledged that ‘yeah…I can see how this would have an effect on the distillers trying to make a go of it.’ I think we could all reasonably expect some sort of an incremental creep in pricing strategies. A fair increase, of course, and one that was relative to related markets. Again…we could always look back at that big ‘18’ on the bottle and think ‘yeah…I can support that kind of investment’.

But now…in our day…a new trend has emerged. Not a new concept, mind you. But a new trend towards the brands slowly (or not so slowly in some cases) stripping away those reliable numbers on the bottle that had previously confirmed for us that the distilleries were just as invested in our purchases as we were. Yes, of course, some non-age-stated whiskies have always been around. And blended whiskies, of course, have rarely trumpeted their age (unless they wanted to be sold as premium spirits). But we’re not just seeing a few non-age-stated whiskies anymore. We’re seeing a tidal wave of brands that have moved in this direction as a means of protecting their valuable mature stocks, while continuing to generate cashflow via the turnover of spirit that historically the brands would have seen as too young to be released as it is. So how is this being mitigated? How are they managing to sell us these younger whiskies and still make them drinkable (and not only drinkable, but in some cases very good)? Through clever vatting on the part of their blenders (and then, of course, a healthy splash of marketing wherewithal).

Many young barrels are being married with a couple of older barrels – which add a little complexity and knock off some of the younger, more spirity edges – then the whisky is sold under a clever name, rather than a number. That age statement which used to be such a key marketing tool for the brands in times of plenty is now a liability due to the requirement that any number on the bottle reflects the youngest whisky therein, and not the oldest.

Just so this is all abundantly clear: we are now buying younger whiskies at prices inflated to ratios that are unsupported by the relative increase in respective costs…and with no justification on the part of the producers. The most prevalent defense is their insistence that our palate decide and not our intellect. And while that is my paraphrasing, the sentiment is just as insulting when spun by the brand ‘faces’ and ‘voices’.

So what has effectively happened now – whether the industry will admit it or not – is an imbalance in the relationship we had spent so much time cultivating. That once understood covenant between producer and consumer. That understanding that allowed us to symbiotically partner up, assuming we were both mutually gaining. As we all know, a relationship of this sort is based on trust. Sadly that trust has been eroded. The scales have tipped, and the consumer is unquestionably the loser.

Ahhhh…so now we’re back to trust, as we were in the opening paragraphs above. As you can see, we’ve come full circle. Now let’s get to the rub…

The brands won’t trust us to buy their whisky if they put a low age statement on the bottle. They don’t trust us to think for ourselves and make wise decisions with our money. They think we will assume a whisky with a low number on the bottle is inferior to their shelf-neighbour’s age-stated whisky and that we’ll maybe reach for that one instead (and what is wrong with that, even if so? Is that not the free hand of the market at work?).

Interestingly enough, while they are cynical and untrusting of our consumer prowess, they insist that this information we’re clamouring for is irrelevant and that we should simply trust them to make the decisions as to what is best for us. They are the experts after all. I mean, really, what could some blogger or writer – who has only tasted a couple thousand whiskies across all ages and styles – possibly know about this stuff, right? We are left to feel like we’re coming across as the annoying squeaky wheel, the to-be-dismissed angsty teen or the bad apple spoiling the bunch. ‘The whisky will still be good’, they say. ‘Don’t worry about what it costs you to buy it, versus what it costs us to produce it’, they don’t say (but it is, of course, implicit).  Ummm…no.  It simply doesn’t work that way in the real world.  Not in any of the transactions or purchases I make, anyway.

Ironically, those missing numbers do make a dramatic reappearance when they want to sell their ultra-premium rare and old malts for astronomical sums. Because let’s face it: who will buy a bottle for $2,500 if they have no idea what their $2,500 is actually buying?

Trust is a two way street. But right now, we’re on a one lane highway and going the wrong direction.  And where do we go from here?  I honestly don’t know, but I’m sort of tired of not getting a peek at the map.

– Curt