March Data Insights: A month isn’t always a month, and why trends will improve in April

Apr 22, 2024

WASHINGTON, D.C.

Everyone knows the months of a calendar year come in increments of 28, 30, 31, and every fourth year 29 days. However, for Wine and Spirits Wholesalers a month is measured in the number of delivery days which run between 20 to 23 days driven by how many weekends there are in the month. A delivery day is simply the number of non-weekend or holiday days in a month when a wholesaler can deliver products.

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March and April of 2024 provide a good example as to why this matters when considering trends and data points in SipSource data. There were two fewer delivery days in March this year compared to last year and there will be two additional delivery days in April. It is important to note the number of delivery days for the first quarter were equal. That said, SipSource Analysts can predict with relative certainty that trends will improve with April-ending data.

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Depletion Trends Remain Challenging
Newly available March-ending SipSource data (April 2023 - March 2024), continues to indicate a challenging environment for wine and spirits depletions as retailers focus on inventory management. It doesn't appear there was any significant promotional loading in support of the Easter holiday as hoped. March ending 12-month trends for Spirits are down -2.7% and down -8.3% for Wine. The numbers for the latest 3-months (January - March 2024) are significantly softer with Spirits down -5.2% and Wine down -10.9%.

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As stated above, next month trends are likely to improve significantly based on two additional delivery days and soft comparable trends from 2023. In April 2023, Spirits were down year over year -6.4% and Wine was down -10.9% and, as there was no apparent pre-Easter loading at retail, SipSoruce Analysts are hopeful for robust restocking after the holiday.

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Usual Suspects Drive Growth
Three product segments have endured in driving growth over the last four years. Premixed Cocktails continue their strong performance, up +6.6% to end March and are doing especially well in the on-premise, growing +24.6%. Tequila/Agave Spirits remain in positive territory as well, up +1.5%. Reposado is key to this growth, up +10.8%. For Wine, Prosecco continues its long run of growth, up +3.5%. <_o3a_p>

What's Next?
Last month we spoke about the impact of destocking at retail, which we believe will stay top of mind as long as interest rates remain at current levels. Inventory levels will continue to rebalance as we move deeper into 2024 which SipSource Analysts expect to drive improved market trends. <_o3a_p>

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