Small Scale Investing in Whisky

Whisky, Scotlands biggest export has had a massive rise in popularity in the last decade, Exports have increased 87% in the last ten years alone with the drink growing in popularity across Asia and even Brazil.

Supply is struggling to keep up with demand and this presents an opportunity for the investor. There is several levels of Whisky investing from budget bottles to super high end £50,000 bottles, and even online only where you can buy shares in the barrels.

This Article will be focusing on Budget whiskys that have a good potential to grow, it is suitable for those who are willing to do a bit of leg work, have some available space for storage for a few years and have a limited budget as it has somewhat limited scale-ability.

This article is strictly my own beliefs and does not imply any recommendation to invest. As always do your own Research and come to your own conclusions. I am just a Whisky lover who has seen some potential for investment here..

So how has this potential come around??

As mentioned demand of whisky is greatly outstripping supply, This surge of interest in whisky somewhat took the industry by surprise..And distilleries are struggling to keep up with demand. So what is their solution?

Non age statment Whisky's or NAS

If you look at the Photo at the top of the page you will notice on each bottles there is a number, this is the age statement of the Whisky and refers to the amount of time it spent in the barrel. Age statement has always been a sign of quality and gives the consumer a direct idea of the potential quality of the drink inside. A good age would be 12 - 18 years in the barrel, with more mature bottling rising in price considerably after this point. If distilleries are struggling to keep up with demand what do they do?

For a whisky to be called a whisky by law it must be at least three years old. But there is no law against not stating the age - so what this has lead to is many distilleries moving to or at least introducing Non age statement whiskys to their range. This helps the distilleries in more way than one, not only can they use far younger Whiskys, but they also have less loss through evaporation during the maturing phase known as "The Angel's Share" (upto 2% lost liquid PER year!)

This has tried to be sold to the consumer as a good thing as it gives them "more creativity" to use younger spirits. But the simple fact is less mature whisky general does not taste half as good. There is exceptions and there is some Exceptional non age statement whiskys on the market like "aberlour a'bunadh" & "ARDBEG UIGEADAIL" - But unfortunately there is a whole lot of below par NAS whiskys from very well known distilleries that have recently replaced whiskys with an age statement.

As NAS whiskys become more prevalent and age statement whiskys become more expensive I believe there is a good opportunity to profit.

So how can we profit from this?

As distilleries and retailers move over to NAS whiskys they often sell the last of their old stock very cheap. A most recent case of this was Lidl with the "Ben Bracken" range. They used to sell a 8 year single malt and a 12 year blended. These have now been phased out and replaced with NAS whisky that is currently retailing at £17.49...The price of the old aged stock sold cheap to get rid of it? £9.99 per bottle..I personally bought 26 bottles at that price point (all I could find)

At this price point that at the time of sale is £2 cheaper per bottle than even supermarket value whisky - this has a very healthy room to profit if held for some time. So lets look at another way to potentially profit from whisky.

Christmas Specials

Each year the supermarkets have a lot of reduced whisky, but Lidl and Aldi in particular have been putting out some VERY impressive bottling's at incredible prices just for the festive season - Lets take a look..

Here we can see last years Christmas specials, there is a 22yr blended Glen Alba & 27yr ben bracken from LIDL, and a 28yr Glen Marnoch from ALDI - All of these whiskys are now selling at auction for at least 50% more than the retail price on average.

These are released into stores in limited numbers, but If you are quick then bargains are to be had.

Supermarket specials and misspricings

These are bottles that can be picked up all year round, sometimes supermarkets just have really great deals at a significant discount to RRP, here we see a bottle of Glenfiddich 18, usual retail price £67,99 - Tesco offer price £40. Whilst Glenfiddich is a huge distillery and can be found very readily - at the right price point and held for the right time there will be profit to be made here. The Balvenie Caribbean Cask I bought at full retail price as I see the online prices rising slowly and its just so Damn nice!

I believe age statement whiskys will start to become more of a premium product, so any picked up cheaply now should see a good return in the future!

Things to consider before buying for investment and conclusion

The main considerations before entering into an investment in whisky is how will you sell and store the stuff..there is plenty of specialist whisky auctions with low commissions, and due to the laws on alcohol sale I will be going down this route. The whisky needs to be stored upright (not on its side like wine) in a cool dark room out of direct sunlight (preferably dark)

So to conclude - the whisky world is growing and slowly changing, and I do believe there is money to be made if you choose your whiskys wisely..With NAS statement whisky becoming more commonplace - age statement whisky will become more premium over time, Whilst this investment has limited scope due to the logistics involved I think this is a genuine case for investment and have put £1000 where my mouth is.

And remember, if worst comes to worst and you cannot profit as much as you would like ......Well you can still drink and enjoy it !

Thank you for reading! I Am just a tiny minnow in this huge steem ocean , If you like my article please support me by resteeming, upvoting and following:)