Reflections, Part One

 Much like my cachaça trip, my writing thus far has focused on my experiences. I’ve said little about my perceptions, and so, with plenty of time on my hands, I think it’s time for me to write a series of posts about the impressions that I currently hold about the world of cachaça, based on my first trip.

I don’t mean this to be exhaustive. I’m sure that I will change my mind about certain things. Other perceptions will likely be reinforced the more I travel.

In this post, however, I want to return to the distilleries I visited and how they sell their products. It should be noted that so-called artisanal cachaça accounts for far less than half of total cachaça sales in Brazil. The big guys still have a stranglehold on the market. However, each passing year, there seems to be a small, but perceptible uptick in artisanal sales.

If the reader recalls the first part of my trip, I found that distilleries sell most of their product from their physical distilleries. To be clear, many, if not most work with retailers. However, because there doesn’t seem to be widespread distribution of cachaça, each distillery undertakes its own sales to individual retailers.

The remoteness of most of these distilleries makes this an astonishing fact. It also shows the importance of online cachaça stores, of which there are multiple, though the most notable is Cachaçaria Nacional.

The limitations on distributor operations may have something to do with the wildly different alcohol taxes from state to state. This also likely has an impact on off-premises sales. According to the people I spoke with, a bottle of cachaça can reach an end user with 50, 60, or even 70% mark-up because of state taxes.

I find this an absolutely astonishing reality, and now understand why sales are so high at these distilleries. The price-differential between an online purchase and an on-site purchase can be as much 10, 20 or 30 reais. Sometimes more.

For someone with plenty of money to spend, and who really likes cachaça, the price difference may not mean that much. But it’s undoubtable that these taxes impact the ability of the average person to consume decent cachaça from any region but the one in which they live.

Brands like Weber Haus, which can be found at major supermarket chains, are the rarity among artisanal producers. Others, like Bylaardt in Luis Alvez, do absolutely zero marketing. Because Weber is more visible, they likely sell more of their product off-site. But Bylaardt, which sells well on-site and through personalized shipments to individuals, doesn’t have to, nor do they want to, do the heavy marketing.

I think there are questions about whether the former strategy is superior to the latter in terms of earnings. Visibility, or popularity is a different matter, however. In addition, the goals of the individual proprietors will always play a role in how much they want to get their name into the public sphere.

Distilleries are increasingly aware of their role as tourist destinations in local economies. While some think of themselves as ambassadors of the cachaça movement, many others think of themselves as part of a regional eco-system. Bringing families and groups to physical locations to partake in the culture of cachaça creation is an important part of both movements.

But most people will never consume artisanal cachaça if the most affordable place to buy it is in remote locations. When a bottle of cachaça costs thirty reais on-site and north of 60 at a store, one can sense that the system is not working well.

I don’t know that there is an easy fix, either. With federal movement to massively increase taxes on cachaça (though currently stalled because of other priorities), there could be even further damage to an already fragile movement to push cachaça towards glory.

For the foreseeable future, most distilleries will continue to make most of their money selling cachaça online or at their physical stores. This remains a puzzling challenge and should be the focus of trade groups interested in breaking impediments to cross-state cachaça consumption.