New Scottish whisky facility targets expanding single cask market

Auld Bond Bottlers (ABB), near Perth, is a 10,000 square foot facility originally earmarked as an on-farm diversification, but the cost of converting redundant barns proved prohibitive.

The business is the brainchild of John Thompson and business partner Vikki Bruce.

Operations Manager Stuart McMillan talks through the process.

Thomson said: “When I was a child we had a smallholding rather than a farm. I owned livestock and was also involved in a number of farms across the Carse of Gowrie, but I chose to move away from farming and into technical businesses when I was around 18.

“Around ten years ago I wanted to move back into farming but found the industry had changed significantly in the intervening years between the 1980s and the 2020s.

Our Political Affairs Editor Jim Millar with John Thompson sampling a dram.

“During that time contracting had become such a big part of it, especially given the capital cost of equipment for example – the industry had moved on and rather than getting directly involved in it, I ended up contracting with someone to do one particular farm and with the passing of my father who had been an avid Aberdeen Angus and Charollais sheep breeder, we ended up contracting that farm as well.

“So while I maintain a keen interest in farming, I may be regarded as a landowner rather than a farmer.”

Vikki Bruce said the growth in distillery numbers in Scotland had seen a parallel rise in single cask ownership.

The blending tank allows the business to increase its offer to clients.

She said: “I think growth in single cask ownership has been driven by the apparent promise of huge profits. This promise seems to be self-perpetuating. Around twenty years ago, a cask of Macallan could be purchased for £10,000, but now the same cask or the same age statement cask could be fetching more than half a million pounds.

“People can see that meteoric rise, which has taken place over the past twenty years, but the market has become increasingly complicated with chains of brokers, but some of these investment companies have no knowledge of whisky or the restrictions that are applied across the industry, and there are fears that this bubble will burst.

“ABB is set up to help clients navigate the regulations, including what can appear on a bottle label and HMRC rules on moving casks.”

Bruce also owns luxury travel firm Maclean and Bruce, founded as a whisky-centric operation.

The bottling process underway.

She said: “When the travel firm began trading, most of our clients were from Asia and were looking at the investment side of whisky.

“Since Covid, there has been a far greater emphasis on gaining insight on provenance and going a step beyond seeing the production side.

“Clients are going deeper into it and seeing the small-circular production and are increasingly interested in the agricultural side of it. At one time there were thousands of stills on farms across Scotland and I think that in Scotland whisky has to be the original diversification in agriculture.”

The firm said there is a lack of understanding about the industry and regulations which is causing problems in some areas, but the policy of rigorous compliance at the business, including comprehensive CCTV coverage, means everything is stringently checked and the firm is completely accountable for what takes place on the premises.

Founders of Auld Bond Bottlers John Thompson and Vikki Bruce.

Bruce estimates that in 2002 there were around five independent bottlers, before the trend for single cask ownership, but across the UK there are now hundreds of businesses dealing in the single cask market, which in turn creates more supply, including more brokers.

She said: “Some independent bottlers are approaching us to work with them as we are an agile firm with shorter lead times and more flexibility than others. We offer other services, such as re-racking – also known as finishing – when you take a somewhat ‘plain’ whisky and put it into a sherry cask for example in order to give it a bit more ‘oomph’.”

Other clients include those who have previously purchased a new cask of whisky and allowed it to mature, sometimes these have been bought as a gift, such as a christening gift.

The firm has been trading since June this year and the owners say it is already in a positive place.

Bruce said: “We knew that business was going to be slightly slow at the start because of the time it takes to move casks between warehouses, plus the client also has to design and order labels and any secondary packaging. So we knew there would be a time-lag, but we have reached the stage where things are hitting their stride which is a good place to be.”

The facility is managed by industry veteran Stuart McMillan who has put in place rigorous protocols at the site.

He said: “These are serious investments for our customers. When the casks arrive, a risk assessment is carried out, the casks are photographed, and samples are taken as part of the process.”

The firm is eyeing expansion in terms of capacity and services. It can now also offer small-scale blending options on site and is looking to increase square footage to boost storage capacity from the current 1200 casks – allowing longer-term storage facilities for clients.