In this issue
The American Craft Spirits Association's 2025 data landed hard. Active craft distillers fell by more than a quarter, to 2,282, and category volume dropped for the second straight year. California alone saw its distillery count collapse by nearly half. When the market contracts this sharply, lenders and investors start reading operational data very closely. Distilleries that can show audited cost-per-barrel figures, tight inventory control, and clean compliance records are in a better position to make that case. A connected system that keeps those numbers consistent across production, inventory, and accounting removes one more vulnerability at a difficult time.
California craft distillers face a concrete deadline: direct-to-consumer shipping rights are at risk as of January 1 under current state law. DTC revenue has been a meaningful cushion for small producers, and losing that channel would tighten margins further for an already stressed segment. Order-entry systems that apply effective-dated state compliance rules at the point of sale help distilleries stay on the right side of each state's requirements without manual lookups every time a rule changes.
On the tariff front, the US-Canada situation continues to shift. A 50 percent tariff on Canadian goods, including alcohol, is now in place, and the broader import framework has moved several times in 2026 alone. For distilleries that source ingredients or finished goods across the border, or that import any component of their supply chain, landed cost projections are harder to rely on. Inventory planning and cost-layer accounting need to reflect actual purchase costs as they change, not estimates set months ago.
Breckenridge Distillery's new Palisade Peach Whiskey and Copperworks Distilling's Farmsmith release tied to Spokane wildfire relief both illustrate something the ACSA data reinforces: limited releases and community storytelling are active business strategies right now, not just marketing. Executing limited runs cleanly, with full lot traceability and accurate COGS at dump, is where production decisions become financial decisions.
Stetson entering the bourbon business at 161 years old is a reminder that the category still draws serious brand investment. New entrants with strong licensing relationships need the same compliance infrastructure as anyone else. General information only; consult ttb.gov or your own legal counsel for specifics on DSP registration and reporting requirements.