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Woodford Reserve’s Staff Spirits Are Down As Spirit Sales Sink

By Sabrina Lynch

  • Woodford Reserve is cutting down 12% of its staff due to declining spirit sales
  • Alcohol volume sales fell 3% for the first seven months of 2024

Brown-Forman (BF.B+0.33%), the owner of Woodford Reserve and Jack Daniels, is letting go of nearly 700 employees and closing a plant as a result of a rapid decline in spirit sales. The Louisville-based company is currently feeling the hard pinch of inflation and changing consumer tastes, accounting for a 2.7% dip in spirit sales across the board. Despite increasing product prices to cover the rising costs of manufacturing, Brown-Forman is still trying to keep the surmounting economic threats at bay. One of the biggest threats being impact on brand share-price. BF.B saw its net sales decline by 5% in the second half of 2024, having already experienced a 30% loss in share value.

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Why It Matters: Purse-pinching consumers have reigned in their spending on pricey liquors and wines, leaving premium spirits companies feeling very nervous. Brown-Forman cost-cutting exercise is a big bid to save $70-80 million in annual costs, but unfortunately at the cost of 12% of its workforce now without a job. The move is a sign of hard times for the spirits industry now contending with nearly 40% of U.S. consumers following a sober-curious lifestyle, seeking alcohol alternatives for their health and to save money.

And even though federal alcohol taxes have been brought down, the alcohol industry is sinking, so what is the reason? It’s a new drinking generation and they seem to be warming up to pre-mixed drinks in favor of spirits and other alcoholic drinks. The ready-to-drink market is projected to experience a 12% growth by 2027.

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What’s Next: 2025 is going to be a challenging year for the spirits industry. The rocky road has become even more challenging following a call to action by the U.S. Surgeon General to update health warning labels on alcoholic beverages.

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