The Liquid Brief (26/08/W2) | From “What to Cut” to “Where to Bet”: Inside Global Drinks’ Next Growth Playbook

Over the past few weeks, the global drinks industry has been focused on cutting costs, rationalising assets and building more resilient routes to market. This week, the conversation moved one step further: once companies know where they can no longer afford to spend, where should the next round of investment go?

From “What to Cut” to “Where to Bet”: Global Drinks Companies Are Reassessing Their Real Growth Engines

The answer does not point to a broad-based recovery. Alcohol volumes in the US are still declining, and some production assets are being reassessed against a weaker demand outlook. At the same time, RTDs, clearly defined drinking occasions and structurally growing markets such as India are emerging as more visible areas for investment.

In other words, the industry is no longer just deciding what to remove. It is beginning to identify which parts of the business are still worth scaling in a slower-growth environment.

Weekly Highlights

Treasury Wine Estates takes a near-US$400m impairment as the US correction reaches physical capacity

Treasury Wine Estates will record a A$558.4 million, or approximately US$394.6 million, non-cash impairment related to its US supply chain. The company said weaker demand has created structural imbalances across vineyards, wineries, packaging capacity and inventory, prompting measures including lower grape intake, vineyard mothballing and inventory reductions.

The significance goes beyond another decline in sales. Once companies begin recalibrating physical capacity around a lower level of expected demand, the market correction has moved beyond promotions and destocking and into the structure of the asset base itself.

US alcohol declines continue to narrow, but this is not yet a recovery

WSWA SipSource data showed that rolling 12-month US wine and spirits volumes fell 6.5% through June, improving from declines of 6.9% in May and 7.1% in April. Spirits alone were down 4.9%, while wine declined 8.2%.

The important signal is that deterioration is slowing, but there is still not enough evidence to call the start of a restocking cycle. Channel performance also diverged sharply: on-premise volumes fell 2.5%, compared with a 7.3% decline in off-premise retail.

Consumers have not stopped drinking altogether. But where and when alcohol is consumed is becoming increasingly important.

RTDs are moving beyond convenience and becoming a genuine growth engine in developed markets

Suntory Global Spirits CEO Greg Hughes said most beverage alcohol growth in developed markets is now coming from RTDs, with the category large enough to influence overall spirits growth.

The US market provides a more direct brand-level signal. Cutwater grew 104% over the past 12 months, ranking among the fastest-growing alcohol brands in the country, while RTDs are also making a stronger push into bars, hotels and event-based on-trade occasions.

The more meaningful shift is therefore not simply that canned cocktails continue to grow. RTDs are evolving from convenient retail products into tools for capturing drinking occasions and improving hospitality efficiency.

India is becoming a market that requires local execution, not simply imported brands

Suntory’s Indian whisky brand Oaksmith is expected to reach two million cases in 2026. During the same period, Rémy Cointreau further consolidated its distribution and marketing operations in India, while IWSR data showed Tequila volumes in the country grew 34% in 2025, with value up 66%.

Taken together, these signals suggest that the India opportunity is no longer simply about selling more imported premium spirits.

Competition is increasingly about whether local brands, distribution, pricing and culturally relevant marketing can work together.

Industry Trends

The competition is shifting from “what do you sell?” to “when will people drink it?”

Pernod Ricard introduced a new occasion-led strategy this week to drive growth in clear spirits such as gin and vodka. At the same time, developments in the US Spritz and RTD markets are increasingly centred on specific moments such as afternoons, aperitif occasions, outdoor drinking and lighter social occasions.

For brands, the competitive set may therefore extend well beyond the same category. Gin can compete with a Spritz, an RTD or even beer for the same summer afternoon.

When overall consumption is no longer expanding naturally, winning more drinking occasions may matter more than simply expanding the portfolio.

Growth is shifting from “more expensive” to “chosen more often”

Premiumisation has dominated industry strategy for much of the past several years. This week’s signals suggest that higher pricing is no longer the only route to growth.

RTDs, Spritzes and occasion-led strategies all point to a different model: products that are easy to understand, easy to order, easy to drink and relevant across a wider range of everyday situations.

Premium demand has not disappeared. But in a market where total volume remains under pressure, frequency of use is regaining strategic importance.

Developed and growth markets increasingly require different playbooks

The challenge in the US is to resize capacity around weaker demand while identifying the occasions where consumption remains resilient. India presents a different set of questions around category expansion, distribution and consumer recruitment.

That makes a single global growth strategy increasingly difficult to apply across markets.

Developed markets require more precise occasion capture. Growth markets demand genuine local execution.

Brands & M&A

There were no major acquisitions this week significant enough to alter the broader industry outlook, while the ongoing trend toward portfolio simplification is no longer a new story in itself.

A more relevant operational development came from Tilray, which is ending production at the Terrapin brewery in Georgia and consolidating output into other facilities. The move reflects a reassessment of manufacturing utilisation, but it is not sufficient evidence to conclude that craft beer is being broadly displaced by RTDs.

For brand owners, the question is becoming less about how many production assets they own and more about whether those assets still match current demand.

New Product Developments

This week’s launches did not establish a new industry-wide product trend, but they illustrate two very different roles that new products can play.

1800 Tequila introduced an Extra Añejo priced at US$11,000 and limited to just 50 sets worldwide, placing much of its value proposition around art, scarcity and collectability. Jameson Distiller’s Batch, by contrast, entered the US at around US$50, using maturation across five oak types to create a more accessible step-up within the brand’s existing range.

One product is designed to create brand elevation and attention. The other gives existing consumers a reason to move further up the portfolio.

Their commercial roles are fundamentally different.

Bar & Hospitality

The most important on-trade signal this week was not the sudden popularity of a particular cocktail. It was the relative resilience of the channel itself, combined with the deeper entry of RTDs into bar and hospitality environments.

For operators, the value of RTDs goes beyond convenience. Outdoor venues, large events, hotels and peak service periods all benefit from drinks that can be served quickly, consistently and with less operational complexity.

That does not mean RTDs will replace freshly made cocktails. But they may increasingly take over occasions where a full cocktail programme is operationally inefficient.

That moves the category from a consumer product toward an operational tool.

Marketing & Campaigns

Patrón expanded its ingredient-transparency campaign in the US this week, bringing the industry debate around additives directly to consumers. The campaign contrasts Tequila’s permitted use of ingredients such as glycerine, syrups and caramel colouring with Patrón’s emphasis on agave, water and yeast.

What matters is not another generic claim around “natural” production. It is the migration of ingredient transparency—a concept already well established in food—into premium spirits.

If consumer awareness of additives continues to rise, competition in high-end spirits may increasingly extend beyond origin, age and cask type to a more basic question: what is actually inside the bottle?

MJFLAIR Insight

The most important takeaway this week is simple: the global drinks industry is moving from deciding what to cut to identifying what is still worth backing.

Treasury Wine Estates shows that capacity built for an earlier demand environment is now being reassessed. US market data suggests declines are moderating, but not yet reversing. At the same time, RTDs, drinking occasions and India are beginning to provide more concrete answers to where future resources may be directed.

Over the next six to 12 months, major drinks companies are likely to remain disciplined on costs. But the more revealing question will no longer be who cuts the most or disposes of the most assets. It will be where the capital released from those decisions ultimately goes. RTDs and on-premise occasions in developed markets, alongside structurally growing markets such as India, are likely to attract increasing attention.

If alcohol consumption in developed markets remains flat or slightly negative over the next 18 to 24 months, the winners may not be the companies with the most brands or the largest production footprint.

They may instead be the companies that identify earliest which drink, at which moment, through which channel, consumers are still willing to buy repeatedly.

As broad-based growth becomes less dependable, is your brand clearer about where it should stop investing—or about which drinking occasion and market deserves the next round of resources?

This industry brief is compiled and analyzed from publicly available industry information and news published during the specified period. It is provided for commercial reference only and does not constitute investment, legal, or business advice.