Growth of the Tequila Industry in the Past 10 Years
We’ve talked a lot about how the tequila market has grown over the past few years, but where is it headed? Is this boom in premium tequilas a passing fad? Or is it here to stay? What will the industry look like in the next ten years, and how much has it grown in the last decade? Today we’re going to examine the tequila industry (note: now is the perfect time to get in the tequila industry) and where experts think it’s going to go.
Looking at Tequila in the U.S. in 2020
With the COVID-19 pandemic, more and more people found themselves working from home, and drinking from there as well. This meant good news for tequila distillers and the spirits industry, and nothing has expanded more than the agave-based spirit industry. In 2020, agave-based spirits were up by 9%, with tequila seeing an 8.5% increase in sales. Between 2020 and 2022 alone, tequila is expected to continue to grow by as much as 4%, meaning there’s plenty of money (and competition) in the tequila industry.
The Global Market
The global market for tequila is increasing as well. Hovering around $10.8 billion in 2020, experts forecast that the industry will be worth somewhere around $25.4 billion by 2026, growing at a rate of 14.4% between 2021-2026. However, many people are understandably on the fence about whether or not this increase is temporary. Luckily, there’s nothing to suggest this trend is temporary, with tequila showing steady growth through the years. For example, between 2014-2019, tequila sales grew by 4% while other spirits declined in popularity.
The main issue in the tequila industry currently faces is breaking out of US and Mexican markets, which historically account for up to 85% of worldwide sales, and introducing the rest of the world to the joy that is tequila; however, many brands are finding their tequila sales are increasing around the globe, as seen in Kendall Jenner’s tequila being shipped to over 80 countries around the world. Many companies are finding they don’t actually care about expanding into international markets; although, we believe that international distribution is the future of the tequila industry.
While many consider tequila traditional “shooter” drink, many brands are looking to produce high-quality tequilas that can easily be sipped rather than shot, which is slowly leading to more international markets accepting tequila as a staple spirit. Australia is a prime example of the success of the tequila industry in an international market, showing a 12% increase in sales in 2020 alone. As more companies focus on tequila as an enjoyable spirit in international markets, the tequila industry could more than exceed what experts forecast in future sales.
Why the Change
There are a variety of reasons we are seeing an increase in popularity for tequila, including:
Cocktail culture is taking the world by storm, with many finding that cocktails offer a whole new drinking experience. Younger people find that shots are passe, instead opting for higher-quality drinks they can sip and enjoy rather than the burning experience commonly associated with taking shots. Canned
cocktails have exploded over the last year as well, with many finding they can get their favorite cocktail out of a can or bottle rather than making it themselves.
Traditional tequila still dominates the market, but many manufacturers are busy at work producing flavored options as well that compliment cocktail culture. From lemon to tarragon to lavender, natural flavored tequilas are rising in popularity as more and more people experience the joys of tequila with flavors they enjoy.
With well over 2,000 brands of tequila on the market, many people are looking to experience tequila in new ways. Most liquor stores or departments have a multitude of tequila brands they can purchase in-store, while online commerce allows people to buy a new brand with just a few mouse clicks. With more tequila options, people are more likely to try new brands to discover a new favorite.
As tequila rises in popularity, people seek more knowledge on the beverage as well. Tequila tastings, classes and cocktails are exploding in popularity, meaning that people are beginning to understand the complexity in tequilas’ tastes and compositions.
Focus on Quality
As people learn about and taste more tequilas, they’re learning what to expect from a high-quality tequila. This means that they want better tequilas—and they’re willing to pay higher price points to get it.
The tequila market is primed for those looking to create their own private tequila label, but it takes a lot of work to launch a brand. From finding the best tequila distillers to getting all the proper documentation in place, you need a company with experience to guide you through the process of starting your own brand.
Aceves Spirits has three generations of experience in the tequila industry and is prepared to help you start your private tequila brand from start to finish.
Contact us today to learn more.