Another hunting season begins.
The limited release bottles are heading out and that means the start of hunting season! Time to dust off the ‘ol Instagram #whiskeyhunting feed, fire up conversations with your local store owners and get to business searching about your local area to trying to find the best bottles at the best prices possible.
That last part is pretty tricky though. In fact, I might wager to say that it’s just as difficult to find the rare bottles as it is to get a reasonable price on them. You might be asking “well, what is a reasonable price?” which is a totally fair question. Reasonable is a very relative term in the given circumstances, and what it essentially boils down to is ‘what are you willing to pay?’ If you’re like me, it’s difficult to make that call on valuation of a particular bottle – unless you are armed with 3 key price points.
Price Point #1: State Minimum Pricing (for control states)
If you’re in a control state, then I feel your pain. There are a lot of things that are negatives for those who live in a control state, especially like the system that we deal with here in Michigan. It’s tough because minimum prices are set by the state, but maximum prices on bottles are not set, leaving the store owners here to do as they please with jacking up the prices on rare bottles they receive. I’ve heard that you can report these stores to the state for gouging but it seems that the process is ineffective. Plus, store owners are in a weird spot too, where they need to move a LOT of product just to see some of these bottles from the distributors, so when they get them, they want to ‘cash in’ on all of that hard work.
Fact is, this number sets the baseline for the price the state intends for particular bottles to be sold for. As such, it’s a number for you to level-set the true value of the bottle. You know that this is what the state intends for a bottle to be sold for. It’s a great thing to help price anchor during negotiations and also lets the store owner know that you understand your numbers. If you live in a control state, be sure to check and see if your state keeps a running list of these numbers, and try to keep it handy. It’s an excellent way to understand what your base number might be.
Price Point #2: Distillery’s Suggested Retail Price
If you can, find out what the bottle is expected to go for, per the distillery’s press release. This is particularly helpful when you live in a non-control state, as it can serve as your bottom line pricing. Not having this number handy can really leave you in a bad place when negotiating, because you won’t really know what value the distillery placed on the bottle when they created it. If the sky’s the limit on bottle pricing and you have no idea where the floor is, that leaves a lot of room for the price to land in an unfavorable spot. Generally we have found that a state minimum pricing ends up being pretty close to the number that the distillery gives out for a suggested retail price, so if you are in a control state this is just a second price floor data point you can use.
Price Point #3: Typical Secondary Pricing
This is where you will see the most fluctuation in price point because it can range quite a bit, but the third price point is secondary pricing. Secondary pricing is the value that bottle flippers on the secondary market up-charge the bottles they get their hands on. Essentially, they buy bottles at low(er) prices and resell them for a higher amount. This has been the bane of the whiskey community for awhile now; flippers will buy up as many bottles as possible and then resell them at insane prices. It’s definitely a pervasive issue in the community.
You’d be forgiven to think it stops just at some guys flipping bottles, but unfortunately it does not. You also have shop owners who will charge an exorbitant amount on the bottles they get legitimately via distribution. Often these tend to collect dust for awhile, but eventually they get sold. We have dedicated a lot of time to understanding why collectors are willing to spend 100-1000% markup on a single bottle and it’s a Rubik’s Cube we’re hoping to solve one day. Is it because they have that much expendable income? Are they planning on flipping it instead of drinking it? Do they simply not know what the true value of the bottle is?
Use these three price points to create your ‘deal range’.
Bottom line is, a decent amount of us are not going to be able to spend $2,500 on a bottle of Pappy Van Winkle 23 Year. In fact, let’s use that as our example here:
We know the distillery sets the SRP for $299.99.
We know the state minimum pricing (in our control state, anyway) is $299.99
We know the secondary price ends up around $2,500 a bottle (and anything beyond that is possible, but that’s where it tends to hover in our area).
So now you know what the price it should be is, and what the totally marked up price is as well. Where do you land? Some of us will say “hey, Pappy 23 is so rare I’m going to pay whatever because I may never see it again.” Others might say “No way I’m spending more than SRP for Pappy 23. It’s good, but it’s not worth anything over.” And of course, that’s your decision to make. I would take these price points and come up with a range like this:
“I understand that it’s supposed to go for $300, but given the rarity and how highly sought after, I am willing to go up to $600. Anything beyond that is a loss in value.”
And that ‘loss in value’ is a subjective number.
But can you imagine how difficult it would be if you walked into the store and had absolutely no idea what these price points were? $2,500 is a lot of money, relatively speaking. How about $2,500 for O.F.C 1989? Ok, how about $2,500 for Boss Hog Samurai Scientist? Clearly, those are two VERY different value points.
The best thing you can do to save yourself some cash is to equip yourself with knowledge. The more you know, the more you can make an educated purchase decision.
Want to know a great way to understand secondary prices? Or what prices that other hunters are willing to pay? Our favorite resource is Overpricedbourbon on Instagram. He shows user-submitted pictures of bottle prices and receipts so you can get a better handle on what everyone else is paying. He’s a huge help to the community and provides awesome insights into what hunters think is a reasonable price vs. unreasonable.
We have to throw our shameless plug in here too. The first version in our app will have average prices that users pay for a particular bottle, so you can get that average simply by opening up the Homebar app and navigating to a bottle detail page. Be sure to sign up for updates on the app below.
As always, have fun out there when you’re hunting and be safe. Cheers!
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