KY Distillery Shuts Down and Goes Up For Auction! - BRT 281

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  • Опубліковано 11 гру 2024

КОМЕНТАРІ • 107

  • @stephenlaurendine284
    @stephenlaurendine284 Місяць тому +3

    Randy, that was a really good explanation-- very informative. Ty!
    Randy made it very clear that this was not a traditional business failure. It had nothing to do with market factors. It had nothing to do with their bottle pricing or high margins.
    Their high bottle prices and margins are results of great products, marketing, and capitalism. It's the same in every industry. Ferrari has higher margins than Chevy.
    Randy also made it very clear that this is not a conventional business sale. This is a court-ordered dissolution because of their divorce proceedings. It's a fire sale. It would sell for much higher if the Carters' had been able to sell it under their terms or better circumstances with proper marketing, bundling, time to find the ideal buyer, and agreements to remain on in some capacity to retain valuable customers/ memberships. The court-ordered auction almost certainly ends the brand and reduces the value of the company to present market value of the real estate and barrel inventory. The court is effectively sawing their baby in half. There are no winners. It's a sad ending.
    Cheers!

  • @scottmattern482
    @scottmattern482 Місяць тому +13

    The market is so competitive under the $80 mark, its hard to justify buying $100+ bottles.

  • @thomasgallagher1945
    @thomasgallagher1945 Місяць тому +7

    I was never able to afford Old Carter, so I share your hope that whoever takes over the business will be able to lower bottle costs! Cheers!

  • @paullee2177
    @paullee2177 Місяць тому +4

    Sorry for your loss. It happens way to often. Retired Air Force MSgt, Vietnam Vet.

  • @rogerreese7624
    @rogerreese7624 Місяць тому +3

    This is such an excellent breakdown. It's a business course but it's also showing you don't need to pay ridiculous prices for good whiskey. And I'll only assuming theirs is good whiskey because I've never tried it. Cheers!

  • @kennethfriedrichsen7079
    @kennethfriedrichsen7079 Місяць тому +6

    I did purchase the Old Carter Bourbon and Rye. However I would not buy them again. There's better products out there for much less. Thx for the content.

  • @topo7777
    @topo7777 Місяць тому +13

    I've never tasted it as my curiosity coouldn't justify the price, but from a business standpoint, this is yucky. Technical term.

  • @markkiecker3003
    @markkiecker3003 Місяць тому +1

    Thanks for the content on this one Randy. You did a good job.

  • @ascentia97
    @ascentia97 Місяць тому +2

    Haven’t even been tempted at their current prices.

  • @ninacrane162
    @ninacrane162 Місяць тому +3

    You just made my day with your Aroma Kit plug!

    • @watcheswhiskeyswines
      @watcheswhiskeyswines Місяць тому +1

      Loved it! I am a little to involved with my whiskey sometimes......

  • @stephennadworny8401
    @stephennadworny8401 Місяць тому +2

    Another great episode, Randy. Thanks for sharing your expert insight. It will be interesting to see what happens with Old Carter. Keep up the great content.

  • @TheNewRevolution
    @TheNewRevolution Місяць тому +5

    I have always passed on Kentucky Owl and Old Carter. I had a friend who got bottles of the 1rst and second series of Kentucky Owl(the ones on which all the hype was built). It was very good whiskey. It was not worth the price for me. Later bottlings I tasted were not nearly as good. This a brand built entirely on hype and overpaying. The products are good. But they're not the best stuff I've ever had. It's your money, spend it how you like, it's just not for me. I've passed on bottles that were in the $120-$130 range(Kentucky Owl. You're not touching Carter for less than $200). Which is about the cheapest I've seen. I think it would be a solid $70 bottle. I'd buy a few at that. I can't see paying 2-5 times what they're worth. It's pretty clear this brand does not respect their customers. They've been overpaying for years.
    Edit: I've heard you say several times in the video, either NDP or MGP. While NDP would describe them perfectly, I would advise anyone paying the rediculous price for a bottle of Old Carter to understand that the juice is not MGP. I don't know where their juice comes from but some of their batch releases has even come from places like Dickel. Everyone knows batchs 6, 11, and 12 was Dickel. Be careful paying big bucks for a bottle you may not care for. I'll be honest, I think it's sacrilege that a bottle claiming to be Kentucky Staight Bourbon is being sourced from Dickel. Not a fan.

  • @WTCrawford
    @WTCrawford Місяць тому +1

    Old Carter was the first bottle that I purchased that was > $200. I was not disappointed. I hope someone can continue the brand and reduce the price.

  • @waynejohnson2838
    @waynejohnson2838 Місяць тому +3

    A friend had a bottle and I got a pour from that. I was disappointed as I had heard Whiskey Bank say it was his favorite bourbon. The standard I use for any high-priced bourbon is how does it compare to Jack Daniels Single Barrell BP. In my opinion, it was not as good and is 4 to 5 times the price.

  • @axegekko6477
    @axegekko6477 Місяць тому +1

    The one B18 I tried was real good. Would try again at a cheaper price. Great info!

  • @smitty7592
    @smitty7592 Місяць тому +6

    Great example of buyer beware...court documents allege large withdrawals and company credit card purchases by the wife. Something smells in those financial statements.

  • @umami0247
    @umami0247 Місяць тому +2

    Its sad they came to this conclusion however the cost of their whiskey was just ridiculous. Same with Four Gate just to expensive for most.

  • @EdSweeney-u9w
    @EdSweeney-u9w Місяць тому +3

    I have a feeling that the USA is going to get more familiar with the term “ Ghost Distillery”.

  • @altmandillon1
    @altmandillon1 Місяць тому +2

    Thanks for the info. I appreciate the work you put into this video. Cheers 🎉🎉

  • @chancebuckman5556
    @chancebuckman5556 Місяць тому +4

    The bubble has to pop sometime.

  • @toddtaylor5852
    @toddtaylor5852 Місяць тому +1

    Some additional thoughts. Mark and Sherry have a wine brand (Carter Cellars) that is similarly priced. They are masters at pricing and distribution. I've had two different bottles of OC, and they were both fantastic! A neighbor of mine is a member of the Social Club, and I went to a bottle release last spring. They do/did it right! Very nice event. Finally, Sherry does the blending, and she does a wonderful job.
    I would say that if anyone wanted to try to replicate their success, they would need to hire her as Master Blender, and that would definitely cut into the profits. A lot of variables would need to be known before making a blind bid. I don't have millions, but if I did, I think this would be too high of a risk.

    • @1andonlyEric
      @1andonlyEric Місяць тому +1

      Hello let me correct you on a couple things. Blending was always done by both Mark and Sherri. Also the Winery belongs 100% to Mark Carter. Sherri was never an owner of the winery or the restaurant bed and breakfast. If you have questions reach out to me

  • @RandalErickson-hb5vr
    @RandalErickson-hb5vr Місяць тому +3

    Great explanation!

  • @DBTdad
    @DBTdad Місяць тому +1

    Reminds me of when my pappy tried to talk me of buying a new Trans Am when interest rates were 20% during President Carter's reign.

  • @irang2215
    @irang2215 Місяць тому +3

    I think one of the Carters will end up buying the distillery. Like you said, it's too hard to quantify how much this producer is actually worth and part of the ridiculous pricing is the Carter's "blending prowess". So yeah, I would guess that one of the Carters will either use their own money or find some investors to help them buy the whole thing.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому +1

      I suspect one or both of them are planning on trying. The problem is someone may bid so much that it is cheaper for them to start a new brand than it would be to win the auction.

  • @rancewhite6781
    @rancewhite6781 Місяць тому +3

    Good video. Nice info

  • @JeffH_SmoknThings
    @JeffH_SmoknThings Місяць тому +1

    Another great video❤

  • @domingocorona7028
    @domingocorona7028 Місяць тому +1

    Not surprised!

  • @freeman436
    @freeman436 Місяць тому +1

    I remember when the KO shot up from $99/bottle to $139/bottle literally overnight. OK tasting whiskey. Not worth either price.

  • @MarkHagan-n4y
    @MarkHagan-n4y Місяць тому +1

    I have all four batches of KY Owl Rye. Wonder what they’re worth.

  • @IANNUCCI1481
    @IANNUCCI1481 Місяць тому +2

    What do you think this will do to the value of any unopened bottles in one's collection?

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      I think they will go up. No matter what happens the two people who were credited with creating the blends will not be involved in future blends. The market tends to crap on the new and glorify the old.

  • @jasonczfan8658
    @jasonczfan8658 Місяць тому +2

    I’ve never even considered purchasing Old Carter due to the insane MSRP. I just assumed their target demographic wasn’t us peasants 😂😂

  • @aaronmulcahy2004
    @aaronmulcahy2004 Місяць тому +1

    Thanks for the video! Kentucky Owl is tasty.

  • @stevenvaughn7737
    @stevenvaughn7737 Місяць тому +2

    If they have 3 million in profit, what would they have to fight about? The best parking spot? Or the size of their office? Something smells ‘round here.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      They were both enormously wealthy before they even started Old Carter. What ever the issue was between the two of them, it wasn't a lack of money.

  • @nhorob67
    @nhorob67 Місяць тому +2

    Seems highly likely the aren't accounting for their COGS correctly. Could $23-24 in COGS per bottle in 2023 be accurate?

    • @bob-rogers
      @bob-rogers Місяць тому +1

      COGS = beginning inventory + purchases/production - closing inventory. It's not necessarily a reflection of production costs.
      Here's a contrived example: suppose you're just selling off the warehouse and you're not doing any production. At the beginning of the year your inventory has a market value of $12 million. You sell off some barrels. At the end of the year, because of inflation your inventory is still valued at $12 million. Cost of goods sold was $0. Or an even crazier example: Beginning=$12 million and ending, due to falling premium bourbon market is worth $11 million, and you only sold one case. Each bottle has a COGS of $83,333.
      So the answer to your question is "it depends greatly on how they value their inventory." If I was a prospective buyer, I'd want to study that pretty closely to see if they changed their assumptions or methodology between the beginning of the year and the end.
      Rent, property taxes, depreciation, etc. are counted as overhead and not COGS.

    • @steveno7058
      @steveno7058 Місяць тому

      @@bob-rogers incorrect. COGS is directly tied to the items that were actually sold. It has nothing to do with the value of the inventory remaining. The value of the inventory would be reflected on the balance sheet

    • @bob-rogers
      @bob-rogers Місяць тому

      @@steveno7058 If you're in the US and your accountant is telling you that then you need to get a new accountant, because the IRS says otherwise. "you must value your inventory at the beginning and end of each year to determine your cost of goods sold." --Publication 334
      The IRS allows for three different methods of valuing inventory for the purpose of determining COGS, one of which is based on the retail value of the inventory. See Publication 538 for more details.

  • @tao265
    @tao265 Місяць тому +3

    I had no idea that K-Y was distilled?! The flavored stuff ain’t bad but lubricity is amazing! Guess I gotta find another source. Maybe Vaseline?

  • @dwayneshaw8417
    @dwayneshaw8417 Місяць тому +1

    Normally listen to on podcast will have to switch to watching these videos.

  • @Watchman999
    @Watchman999 Місяць тому +3

    I'm struggling to empathize. I hope the market sorts itself out sooner rather than later.

    • @scottmattern482
      @scottmattern482 Місяць тому +3

      People just need to stop buying bottles on the secondary market, it would end the incentive for people buying as many bottles as they can.

    • @Watchman999
      @Watchman999 Місяць тому +1

      @@scottmattern482 truth

  • @lordgarth1
    @lordgarth1 Місяць тому +1

    No one is going to be able to just continue the brand as is without a Carter involved. It’s not like they were just the owners and they had someone else doing the blending.

    • @PatrickS0057
      @PatrickS0057 Місяць тому

      Same with Kentucky Owl now. Does anyone buy current bottles of KO anymore?

  • @MarkHagan-n4y
    @MarkHagan-n4y Місяць тому

    How does the KY Owl brand play into this auction?

  • @redk8917
    @redk8917 Місяць тому +1

    I have one KO that i got when it eas marked down to $50. It's ok for that price definitely not worth msrp.

  • @byronwadsworth8067
    @byronwadsworth8067 Місяць тому +1

    Can you ship bottle picks to TN, I'm in Brewzles Patreon but they can't ship to TN.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      TN blocked shipping. As far as I know there are no shipping retailers who can legally ship to TN.

    • @byronwadsworth8067
      @byronwadsworth8067 Місяць тому +1

      @BourbonRealTalk I just moved to TN and I now hate it lol

  • @stuartrollings602
    @stuartrollings602 Місяць тому +2

    Howdy and wow…I think I just listened to the Accountant from the movie! Affleck would be proud !

  • @zrumble
    @zrumble Місяць тому +2

    That was Covid money time…..

  • @eafarrar
    @eafarrar Місяць тому +1

    "Above normal margin" -- you don't say! Haha.

  • @rpredl
    @rpredl Місяць тому +3

    Over paying for whiskey. Go figure.

  • @DavidG-f6t
    @DavidG-f6t Місяць тому +1

    Everything is starting to break down. Bourbon has gotten too expensive and the average person just can't afford 100 dollar bottles anymore. Most people also have accumulated enough that they will never drink it all. Me being one of them so I am extremely picky now.

  • @Whiskeycrys
    @Whiskeycrys Місяць тому

    I know it’s probably an accident but you refer to Mark several times as Mike in the video.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      I am sorry about that. I noticed it yesterday but it was too late to re-record.

  • @waynefialo9492
    @waynefialo9492 Місяць тому +1

    The new home of The Prideful Goat???

  • @Tngoz
    @Tngoz Місяць тому +1

    To expensive.... never tried either.

  • @DanDaWhiskeyMan82
    @DanDaWhiskeyMan82 Місяць тому +1

    It sounds like bad news all around and dumpster fire 🔥 sale.

  • @DankHobbs
    @DankHobbs Місяць тому +1

    PAY-TREE-ON

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      Did I pronounce it wrong? I am always unsure how to say it.

  • @steveno7058
    @steveno7058 Місяць тому +1

    85% gross margin? The hell with these scammers.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому +1

      Keep in mind that they might have a normal 35% gross margin on bottles and the balance was because there were so many paying members of the social club. The only way to know would be to request the due diligence documents, but if you do you would be violating the NDA you signed to get the information is you shared it with anybody.

  • @hoobeydoobey1267
    @hoobeydoobey1267 Місяць тому +1

    The man who started Kentucky Owl set out to create great bourbon for cheap. Later, he was shocked that the distributor cranked the price sky high due to KO quality. He stated this in an interview for a magazine. So anyone who bought KO gets what they got - overpriced juice that was supposed to sell for $40-50. If you bought it due to the high price, you played yourself. If you take a biz course, you will find case studies on companies that went bankrupt because they marketed their product for cheap because they had concern for the consumers. The same idiot consumers who wouldn't buy the product because it was priced low.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      This can not be true. When you strike an agreement with a distributor/wholesaler to market your product in a state, part of that agreement is what margin they are going to charge. I am not saying it never happens, because it happened to me on the 4th release of The Prideful Goat 15 Year Kentucky Straight Bourbon, but it was an isolated incident. The concept that all the different states that represented KO all decided to mark up the price against the wishes of KO, keeping the money for themselves, is not possible.

  • @JJ-nh8lv
    @JJ-nh8lv Місяць тому +2

    Perhaps they are going under because their stuff is too high?

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      Maybe check out the video. The business is crazy profitable. The reason is in the video.

  • @RebeccaPaige
    @RebeccaPaige Місяць тому +1

    From this I'm seeing Old Carter and Kentucky Owl as overpriced sub $100 bottles

  • @Ray.J
    @Ray.J Місяць тому +1

    So a blender can call themselves a distillery? Seems like false advertising. Never bought those brands, no loss to me.

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому +1

      There is no difference in the license for a producer who bottles spirits they bought from someone else and a producer who distills their own. Both are distilleries with a DSP license.

  • @007JRP1
    @007JRP1 Місяць тому +1

    Not $1 from me. I’m sure not bad whiskey but IMO was overpriced so I avoided their brands.

  • @tomshanley5405
    @tomshanley5405 Місяць тому +1

    That is one heck of a profit. this news is shocking to me, but domestic issues can kill businesses.

  • @teamnolegs
    @teamnolegs Місяць тому +1

    NDP, exclusive club to even be on the property, really overpriced bottles...

  • @krischaney9034
    @krischaney9034 Місяць тому +1

    There's a lot to love about Pretentious Whiskey Reviews. But my absolute favorite part is the deep voice "Oooh" Randy utters when he noses the 1982 Pappy. 😂

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому +2

      We had to do a bunch of takes because Wes kept laughing off camera, but the mic was picking it up.

  • @PatrickS0057
    @PatrickS0057 Місяць тому

    Buyer beware, especially when it's a non distiller producer charging high MSRPs for whiskey of unknown or murky origin or quality. I'm willing to pay $300 for a Wild Turkey 15 yo or a Bruichladdich Octomore because, enen though I acknowledge its probably not 3-6x as aromatic or flavorful, I know what to expect, so little risk in the spend. Do we really think the blenders at Old Carter, Frank August and Old Stubborn are THAT good to justify the inflated prices. I get it...its capitalism, so kudos to them for their success at business, but I'm not their buyer. Oh, and Randy, please clarify when they call their business a "distillery". Is that because you need a DSP to warehouse and/bottle on premises? They dont have an actual distillery. I hear the Bourbon Pursuit guys using that all the time as well. Great episode, keep up the good work!

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому +1

      It is an industry term, because of the license you need to bottle. It is the same license you need to distill your own product. A more accurate term would be producer, but you just get in the habit of referring to a business with a DSP as a distillery.

  • @1andonlyEric
    @1andonlyEric Місяць тому +1

    While I appreciate your viewpoint based upon the limited information you had to work with it’s unfortunately quite inaccurate. Let me just respond to some main points because I can’t respond to everything. Why were profits so high? Because they had no rent as they purchased that building spent a ton renovating it. Because they loved what they do they never drew a salary aka they worked for FREE. SO there was no payroll. The club fees went to paying Jay and Brian. They never intended to sell the brand so any posturing is non existent. Also those 1300 barrels the majority was contract distilled as new juice so 2023 barrel pricing is irrelevant in the sake as their barrels were bought very competitively. The other businesses never subsidized anything related to old Carter but provided enough income that they didn’t want to take a salary and use it to grow the brand. Yes it’s ultra premium whiskey and not for everyone. I can tell you that they had a long waiting list to join the social club as all lockers were spoken for to the point that it was going to double in size until their differences made it too challenging to continue. If you have real questions or simply want to know who the heck I am and why I know all this and much more I’ll leave that for a separate conversation

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      I understand. That helps to explain the high profit, but salary and rent are not part of cost of goods sold, so that does not explain the sky high gross profit (which I suspect is partially because of social club dues). Also, owning a building does not entirely eliminate facilities costs. There would be depreciation for the building and improvements, and other expenses like taxes and insurance. If in fact they paid for everything in cash, let the business use the facility for free, and didn't recognize any costs, then the P&L that was released is inaccurate in a way that could lead people to the wrong conclusion. I have spoken with at least one other person that was close with Mark who explained that some of the considerations I brought up in the video were not in alignment with Old Carter's reality, but as I said in the video, this was more an opportunity to open up a discussion about behind the scenes considerations for producers than it was meant to be an accurate portrayal of the actual situation with Old Carter. Thank you for sharing your information. I wish Mark and Sherri the best as they move forward and hope that Old Carter continues to success after the auction.

    • @1andonlyEric
      @1andonlyEric Місяць тому

      @ if you consider that they haven’t really changed prices since the start. The bottles were $199 and aside from some special offerings that were older the prices did not change they went up maybe $20. If you take the American those are 13-16 year MGP. The rye is MGP. You compare those prices to Rare Character especially their 10+ year MGP in Brook Hill which is $299 retail and selling for $700 at liquor stores. Black Arts 10 year MGP at $199 , Binders Stash, Life of Luxe , Willett etc etc any other ultra premium offering it’s competitive so if their price is where the market allows and they happen to have a higher profit then I’d say they are doing something right. I mean there’s more to the story and other factors I’m happy to share with you off the comments section but hopefully the sale happens soon and they can start the next chapter. The divorce is near complete and then only the sale will remain. I’m happy to share with you the next chapter once this is done

    • @1andonlyEric
      @1andonlyEric Місяць тому

      @ also the P&L was not intended to be published. The third party released those numbers in the news release when the Carters thought the sale was announced they were NOT expecting the P&L to be provided. You can believe it or not but I got a call as soon as it happened and Mark was in shock

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      @@1andonlyEric Call or text when you have a min to talk. 214-385-9101

  • @YoJimBo851610
    @YoJimBo851610 Місяць тому +1

    221👍

  • @gregoryh4601
    @gregoryh4601 Місяць тому

    Sound like being Greedy and make Money Fast then Get out of the kitchen. Bet they’re back together without no one knowing it. Again Screw the Middle Class

    • @BourbonRealTalk
      @BourbonRealTalk  Місяць тому

      This is an implausible theory, and assuming this level of negative intent will literally ruin your life and drive you insane. Understanding where these people came from would inform you that the split proceeds created from the sale of this brand is nothing compared to the net worth they generated before this, so the idea that they would do this as a stunt to make money is preposterous. I encounter a lot of people who are not happy in my comments, and most of them are making themselves miserable imagining the worst thing they can think of being true. Don't do that to yourself! You have a happy life to live, and you won't get to it with this type of conspiracy thinking. Cheers brother!

  • @osamashatat
    @osamashatat Місяць тому +2

    First