“The best time to plant a tree was 20 years ago. The second best time is now.” The same might be said of buying whisky. As barely a month passes without a whisky setting a new record auction price, it would be easy to think it’s too late to join the party.
It doesn’t help that there’s always some curmudgeon around boasting of the good ol’ days, when fine bottles of whisky were affordable and could be picked up off the store shelf. Times may have changed, but there’s no point in thinking about what could have been. With some perseverance and a smart approach you can acquire the bottles you desire. Whether you are a longtime collector or just starting out, the best time to start shopping is today.
The Joy of Collecting
Whisky connoisseurship begins with your first sip and propels you through life’s adventures. Along with the accrual of fine bottles of whisky, you’re likely to collect new flavors, knowledge, and like-minded friends. Every collector of whisky is unique; some amass hundreds of bottles from one cherished distillery, others meticulously compile complete sets from a particular series, while some find the greatest satisfaction in an assortment of bottles all opened for enjoyment and sharing. The happiest collector is one who lets their personal taste guide them.
“People collect whisky for all kinds of reasons,” explains Martin Green, whisky specialist at Bonhams, Edinburgh and a central figure in the development of whisky auctions from the very beginning. “Some build a collection of first-rate expressions across a range of distilleries while others target specific distilleries or particular areas of production—Islay, for example. There is increasing interest in collecting whiskies from closed distilleries, spurred by the thrill of the hunt that all collectors get and a certain air of romance—the past always has huge appeal. Of course, some people collect whisky to drink, and they will be guided by their own tastes or perhaps a desire to try something new.” Your collection should be a source of comfort and solace, a keepsake of wonderful memories of late nights shared in good company, and a treasure trove of the liquid souvenirs of your life.
Collecting whisky offers stimulation for the mind, though at its heart it’s an emotional activity with each bottle saturated in memories; collectors can recall the exact circumstances of where and when they found a precious bottle, how it tasted, who they were with, and how much they paid for it. That passionate association with the bottle separates it from those who possess whisky with the primary goal of investment.
That’s not to say whisky-loving collectors aren’t well positioned to profit. In fact, they are often at the forefront of collecting trends. “My first Port Ellens bought for my bar back in the 1990s cost me £35 ($45),” recollects Port Ellen collector Jon Beach, who runs Fiddler’s Highland restaurant with rooms by Loch Ness, “But when I started collecting them for myself, my limit was £100 ($128). There were plenty of bottles under that threshold, but I made an exception for Diageo’s Annual Releases.” Beach remembers buying bottles from Caol Ila Distillery in 2005 that are now valued at several thousand dollars apiece, “They used to cost the princely sum of £115 ($147), even the First Releases.”
Unlike those collectors for whom whisky is just another commodity, like gold or soybean futures, collecting by the enthusiast can border on addiction. Many collections grow to occupy entire rooms customized for the purpose, filled with the appurtenances of the whisky life. “As peoples’ tastes get more sophisticated, they start to trade up with their buying habits,” says Bill Mackintosh, co-founder of Scotch Whisky Auctions. “They will send us half a dozen Rare Malts because they want to buy a Port Ellen instead. Some of the people that started out with Rare Malts are now in the Karuizawa league. From that point of view, the market just goes on and on.” Collectors love to draw up inventories and categorize their collections for display: arrange them alphabetically by distillery, by region or country, by era or age, or even fixate upon the John Cusack option from “High Fidelity” (2000) and organize them autobiographically. Consider yourself warned.
The retail store is an obvious place to start your collection, but it can be tricky to get desirable limited edition releases here. Many retailers use lottery systems to dole out prized bottles, or require you to line up outside in the parking lot before the break of dawn. The days when you could walk into a store and pick up Pappy Van Winkle 23 year old off the shelf or enjoy Macallan 18 year old for under $50 a bottle are gone. However, loyalty to your local store may be repaid with first dibs on their scarce allocations. Explore shops when you travel and visit distilleries; pick up limited editions wherever you can.
Compared to a decade ago, more whisky may be auctioned in one night than was sold over an entire year. Online auction houses have created a paradigm shift, attracting a growing global pool of collectors. By offering around-the-clock bidding on spectacular selections of whisky, they have created a dynamic secondary market that was lacking in retail. Sure, it is too late to buy single cask Karuizawa for under $150, but don’t be disheartened. That’s like giving up dating altogether because Jennifer Aniston and George Clooney are already taken.
Remember, the majority of collectible whiskies currently trading at auction were released this century, not the last or the one before. The odds remain good to be able to buy a bottle of limited edition whisky that will increase in rarity and desirability. In the global auction market, they are only a click away.
Online auctions are like gladiatorial combat for whisky collectors. Auctions pitch you into direct competition with innumerable adversaries stalking the same quarry. Your competitors may use sly tactics to outwit you; lurking until the dying moments before unleashing a quick ambush, raining down repeated tit-for-tat blows designed to antagonize you into surrender, or deploying a high bid of insurmountable invincibility. There is elation and misery of the sort you do not find when it’s just you and your credit card in a liquor store.
If you want to experience the drama of the live auction, seek out the trailblazing auction houses from Glasgow, Edinburgh, and Hong Kong that initiated and developed the market in the first place. The biggest auctions are online, and the thrill of participating in a live stream is nearly as good as being there. Whisky auctions are gloriously cosmopolitan. Once, the reckoning for the highest bidder was decided in less than 30 seconds before the gavel fell. Now, around-the-clock online bidding has significantly eroded the oligopoly of the traditional live auctions. While Scottish collectors are placing bids in the early evening as the auction closes down, bidders in Hong Kong are staying awake through the night to win their bottle. In the U.S., collectors discreetly file afternoon bids on their iPhones when the boss isn’t looking.
Online auction houses attract the greatest number of participants, which generates higher hammer prices. Record auction prices result from a battle between two or more determined bidders. Intuitively, this means you can find more bargains at the quieter sites, although they may lack the breadth of selection. Sometimes bidding on many lots closes simultaneously. You may win some, none, or all, so it requires spreading your bids and budget across bottles carefully. Your bid needs to be monitored, defended, and nurtured as necessary. Many people will only bid four or five times online before they lose heart and go looking elsewhere.
What to Buy
To paraphrase Warren Buffett,“It’s far better to buy a wonderful bottle at a fair price than a fair bottle at a wonderful price.” You can bid on whisky online on almost every day of the year, so adopt a smart collecting strategy to maximize your gains and get the bottle you crave.
A theme can help your collecting focus: your birth year, Prohibition-era bourbons, or dormant distilleries, for example. “There are some whiskies that become strong favorites with collectors,” explains Martin Green. “Currently the Macallan is in high demand, not just at the top of the market but at all price levels. This has certainly encouraged some owners to consider selling.” You’ll be pleased you narrowed your search once you realize the effort that can go into researching a single bottle. You are looking for that perfect combination of the right distillery, age, limited availability, price, and packaging on a whisky that has garnered great reviews and sells reasonably close to your budget. By setting your sights on attainable bottles, it is possible to win.
Another useful strategy for bargain hunting is to look for emerging brands and territories, and categories on the rise. Look forward, not backward. “Port Ellens were easy to pick up until about five years ago when the ‘age of innocence’ ended,” remarks Jon Beach with relief. “Since then, I’m glad I put aside these rare gems and can enjoy them with friends.” If everyone is bidding on Port Ellen, why not become the world’s greatest Kilchoman collector instead? Don’t overlook mixed lots either, as you can get bargains and split them up into ones you’ll drink, collect, or resell.
This year, Buffalo Trace Antique Collection, Compass Box, Midleton, Brora, and Rosebank whiskies are on the move. Knowledge will allow you to identify the trends: some whiskies have plateaued, some are rising steeply, some hold potential waiting to be unlocked. While times are generally good for whisky sales, there are no guarantees. Some releases have struggled to hold their original price at auction, like the Ardbeg Double Barrel, Lagavulin 25 year old 200th anniversary, and Port Ellen 16th Annual Release.
When the crowds rush past you toward the online auctions, you could choose to go in the other direction. Why not take the day off work to attend an auction in person? There’s nothing quite like the drama of the saleroom, with the auctioneer directing the energy to a climax like an orchestral conductor. In addition to the opportunity to inspect and handle the bottles before the sale, sales without online bidding bring less competition and lower hammer prices, although premiums may be higher than online-only auctions.
Learn to spot patterns in the secondary market: Islay’s Fèis Ìle bottles flood the market over the summer, but you can get a better deal if you wait until the third or fourth wave as prices fall back. Currency fluctuations can also present opportunities for the savvy collector if you are using the UK-based auctions, especially with the volatile political situation over Brexit. A weaker pound against a powerful dollar gives you a competitive edge. All the main online auctions have reported a strong growth in U.S. buyers, and U.S. collectors bought more bottles than bidders from any other nation during Whisky Auctioneer’s spectacular Karuizawa sale in March.
Find auction houses that you trust and get familiar with their website’s features. Avoid costly surprises by being fully informed about premiums, taxes, storage, and shipping charges, which could easily add 30 percent or more to your final price. Auction sites work hard to provide the best service to their buyers, especially when it comes to packing up your winnings and delivering them safely and securely. Finally, look after your bottles properly. If you intend to sell them someday, look after the packaging carefully, protect against evaporation, water and sunlight damage, and make sure your home insurance offers sufficient coverage. It may be necessary to carry a special rider for a large collection.
It is not too late to start collecting whisky, but the pursuit is evolving quickly. Don’t be deterred or let favorite whiskies pass you by when you can begin collecting today. Twenty years from now, you will almost certainly be glad you did.