Jack Daniel’s Distillery Fighting Competition From U.K. Conglomerate, But Can They Win?

The Brown-Forman Corporation, owners of the Jack Daniel’s distillery in Lynchburg, Tennessee, is seeking to protect itself from competition.

There is a year-old law that defines absolutely the process used to make Jack Daniel’s, the world’s best-known Tennessee whiskey.

The fermentation of the mash must be done only in Tennessee from least 51 percent corn, aged in new charred oak barrels, filtered through maple charcoal, and bottled at a minimum of 80 proof. If the method, and other conditions, are not met – it isn’t Tennessee whiskey.

Last year, the Tennessee legislature passed a law confirming those terms and conditions. Now the lawmakers are considering reversing some of those requirements because they say it makes it too difficult for craft distilleries to market their spirits as Tennessee whiskey.

Republican state Rep. Bill Sanderson said, “There are a lot of ways to make high-quality whiskey, even if it’s not necessarily the way Jack Daniel’s does it. What gives them the right to call theirs Tennessee whiskey, and not others?”

Jack Daniel’s understand that this change of heart is being supported and pushed by Diageo PLC, a British conglomerate that owns George Dickel, a competitive distillery for Tennessee whiskey made some 15 miles away.

Jeff Arnett, the master distiller at the Jack Daniel’s distillery, said:

“It’s really more to weaken a title on a label that we’ve worked very hard for, As a state, I don’t think Tennessee should be bashful about being protective of Tennessee whiskey over say bourbon or scotch or any of the other products that we compete with.”

The principal change in the law allows Tennessee whiskey makers to reuse barrels, which represent considerable savings; new ones can cost $600 each.

Sanderson admits that he introduced the measure under pressure from Diageo, but said it would also help micro distilleries opening across the state.

Diageo executive vice president Guy L. Smith IV., said: “This is about Brown-Forman trying to stifle competition and the entrepreneurial spirit of micro distillers. We are not sure what they are afraid of, as we feel new innovative products from a new breed of distillers is healthy for the entire industry.”

Jack Daniels’ stores its whiskey in new barrels made at a Brown-Forman plant. Sanderson (speaking of the competition) said, “If they’re making an inferior product, the market will decide.”

Jack Daniels is an American institution, and probably has enough strength in the name to see off any competition.