Premium wine and spirits and the US consumer

For many alcoholic beverage suppliers, 2023 was a difficult year. Bloated wholesaler inventories, a “rich-cession,” and a shift in spending priorities weighed on alcoholic beverage sales – wine in particular – and the reversal of premiumization trends was notable. We expect trends will eventually improve, but the trends affecting older and wealthier consumers present downside risks to the recovery process.

Key takeaways include:

The resilience of the US consumer is the main reason the economy did not head into the recession that many economists expected last year, according to the recent Rabobank report “The US Consumer: Beyond the Headlines.” Yet for many alcoholic beverage suppliers, 2023 was a difficult year. Bloated wholesaler inventories, a “rich-cession,” and a shift in spending priorities weighed on alcoholic beverage sales – wine in particular – and the reversal of premiumization trends was notable. We expect trends will eventually improve, but the trends affecting older and wealthier consumers present downside risks to the recovery process.