Exploring the Bourbon Secondary
There’s no topic more controversial in bourbon right now than the secondary market. Whether it’s Craigslist, Facebook groups or BottleSpot bourbonr’s usually have a strong feeling about the secondary. There are some that delight in the secondary (not just flippers) while others despise it. If you’ve followed bourbon for the past couple of years you’ll know that the secondary exploded after Ebay shut down all alcohol sales. Prices have also exploded with the increased popularity of bourbon. There’s even a site dedicated to the market value of bottles.
What really initiated this post was Buffalo Traces comments on the secondary market. You can read the full post here. That night, DustyBid (another popular secondary site) was shut down. I’ve been assured that it was a mere coincidence but it still had the bourbon world talking. I decided to reach out to Patrick from Bottle-Spot for an interview. For transparency, Bottle-Spot has advertised on Bourbonr since 2013.
Interview With Patrick
– When and why did you start Bottle-Spot?
I got the initial idea for Bottle-Spot in mid-July, 2013. I basically wanted to sell or trade some 2012 scotch releases I had for some 2013’s, and quickly realized how scattered the secondary market was. I’d always just assumed there would be an eBay or Craig’s List for alcohol, or at least wine. I did some research and found a cloud classifieds platform that allowed me to rapidly bring Bottle-Spot to market and we went live on August 8th. A good friend of mine, Joe Craig, gave me some creative feedback and helped shape a redesign of the site that went live a month later and he officially came on board as co-founder a bit later.
– What is you or your lawyers response to the legality of the site?
Bottle-Spot operates under the principal, under US Federal Law, that it is illegal to engage in the business of importing, producing or selling distilled spirits without a license. This is an important distinction, as is the original intent of 27 USC § 203, the post-prohibition law which governs licenses for people in the business of importing, producing and selling distilled spirits. The law also specifically mentions and effectively defines a “business” as one where purchasing for resale takes place at the wholesale level.
With this in mind, we feel the IRS rules for hobby revenues apply, and that casual buyers, sellers and traders of rare spirits are not in the business of selling distilled spirits. This is a post-retail market, meaning all taxes and other fees associated with production, importation and other distribution have been paid before the bottle ever appears on our site. Of course, we have licensed vendors who also sell with us, and all rules associated with that license would apply. It’s also important to note that this law applies only to interstate commerce, so individuals who are still concerned could simply keep their dealings to locals only.
Beyond that, users simply must become familiar with state, and even local laws, which vary widely. We’re looking at ways to help people navigate these laws, and we’re always prepared to change our business model should regulation require it. We do, however, want to stress that these post-prohibition laws were written to break up criminal enterprises formed during prohibition, to ensure that only safe, quality products made it to market, and to levy taxes. Bottle-Spot does not, nor do our users interfere with any of those goals.
– What did you think of Buffalo Traces comments about cracking down on the secondary market?
I’m not sure what they think they’re going to do, our how specifically I want to address it. What I will say is they’ll have their work cut out for them, because even if we did go away (and we’ve got no plans to, nor do our attorneys feel anyone has the legal authority to force us to) there’s still Facebook, Reddit, Craig’s List, our direct and indirect competitors and literally every single booze related discussion forum on the planet. The secondary market isn’t just us, just bourbon, or even just whisky and liquor in general. The craft beer market has a similarly complex ‘underground’ structure, and wine has several fairly free and open options for collectors. The secondary market is not going anywhere.
– Has anyone contacted you about pulling BT products?
Nope.
– Account verification is one of the most important issues when buying/selling online. How does Bottle-Spot verify users accounts?
Right now it’s pretty straight forward – we offer our users the choice of sending a picture of a government issued ID, or we allow people to send over links to social media. Generally if someone has an established presence on the internet we can verify them using that method, but we obviously prefer seeing an ID. In the future we might look into a more automated process, but for now this is working for us. We also have behind the scenes tools and processes we use to look at all new registrants and posters. We’ve also had to do away with allowing anonymous listings, and the reception to that move has been mostly positive.
– You recently added some new features, what all was included in this 2.0 version?
It’s an entirely new platform built on several custom and off-the-shelf components, so while we’ve tried to maintain the same look and feel, the underlying architecture is brand new. The two biggest additions are auctions and feedback features, as well as user verification.
– Why auctions?
There’s a massive, established infrastructure of third-party auction houses out there, more so in the UK, but that always involves sending your bottle off and having someone else do the leg work for ten or twenty percent of the sale price. Our auctions function more like those on eBay, because all sellers are verified, but we don’t charge any commissions since we aren’t acting as a third party. We feel auctions will help determine the true market value of each item, particularly since we’re not incrementally driving up cost with fees.
-What kind of features might you add in the future?
We’ve spent most of the past month trying to do little fixes here and there and responding to user requests, and it’s likely the 2.1 release will answer more user requests – we’re actually about to start directly soliciting more feedback. Beyond that we’d like to add more community features to encourage more trading and feedback as well as some other new stuff we’re not ready to make public.
– What part do you think a standardized secondary market plays in the bourbon world going forward? Is it a part of the problem or a necessity?
Whether or not people hate the current state of the secondary bourbon market, or flippers or whatever, the secondary market is a good thing. A standardized secondary marketplace, which is what we want to be, would be a very positive for bourbon, whisky and booze in general. If we focus on bourbon, it’s increasingly clear that the primary market can be at least as bad as the secondary market, and in some cases much, much worse. Everyone’s seen shots of $600 price tags on Old Rip Van Winkle at this point.
There is a massively off-balance supply and demand issue with bourbon right now, and until either supply corrects, prices will correct. Our goal is to bring people over from Craig’s List where anything kind of goes, as well as from retailers asking upwards of $3,000 a bottle for this year’s Pappy 23. For what it’s worth, we’re also bringing back vendor listings at some point soon so everyone’s playing on the same field. One the more frequent, and most valid criticisms we’ll get is that some bottle on our site for 2x retail is over at Binny’s for retail (with a case discount!). We don’t benefit from anyone overpaying, and we want potential buyers to know about that deal at Binny’s.
At the end of the day, the site was founded as a collector’s and connoisseur’s marketplace. We can’t introduce more supply into the market to ease demand, but we can try to keep things as transparent and fair as possible.
My Opinion Of The Secondary
I hate seeing bottles flipped merely for profit. It’s annoying when to see bottles posted for sale from the parking lot of a store. However, I believe a secondary market for buyers and traders is necessary. Some guys use it appropriately, and I don’t want to lose that. If I missed out on William LaRue Weller but was able to grab two bottles of Stagg I want to have a place to make that trade. Or, sell one bottle and go buy it at an above retail price. If I want a bottle of Wild Turkey 8 year from the 80’s I have no other place to turn but the secondary. For me, it’s frustrating to see the secondary abused, but it’s hard to imagine shutting down flippers without shutting down the bourbon enthusiast as well.
Now, I pose the question to you? What should be done about the bourbon secondary? Do you hate it, love it, or apathetic?
77 comments
The idea of shutting down a market for anything that is legal to purchase is inherently ridiculous and goes against everything the US Economy was built on. This isn’t a “secondary” market but a true market and the laws of supply and demand should govern it. Scarcity drives prices up and shutting down sites like BottleSpot will actually have the opposite effect.
Prices are inflated because they should be inflated right now. It was no different during the Tulipomania and the Beanie Baby craze. If I want to purchase a Pappy Van Winkle and it’s worth $2,400 for me to have it, then I have the right to buy it. Likewise, if I have a Pappy Van Winkle and someone is willing to pay me $2,400 for it, that’s my right to decide as well. Either of us runs the risk of being a fool later on.
Prices will adjust over time, either up or down. There is risk and reward in every transaction you make and that is the nature of the free economy. The distilleries need to make their own difficult decisions on how much to produce to meet demand, balanced against the risk they run of being stuck with excess inventory if the market becomes oversaturated.
Nobody has the right to live on Park Avenue, just like nobody has the right to drink rare whiskeys. There are flippers of whiskeys just like flippers of stocks and houses. There are also drinkers of whiskey just like long-term investors of equities and homeowners. Sure, it makes you angry because you can’t enjoy your Elmer T. Lee and your Weller 12 like you used to, but a rising tide lifts all ships. Keep in mind, however, what Warren Buffett famously said: “Only when the tide goes out do you discover who’s been swimming naked.” The people overpaying for rare whiskeys with no intention of enjoying them may find their windows to sell them for a profit slammed on their fingers.
It is foolish to attempt to eliminate a market that serves the function of matching willing buyers and willing sellers together. The true focus should be on regulating the market, ensuring laws aren’t broken and buyers are protected.
Fortunately, there is a lot of great whiskey out there for the true drinker and readers of this blog and others will discover and appreciate those gems.
Very well said.
Fuck the secondary market to take a bottle that sells at retail for 49dollars and then put it in the secondary market for 800 to a 1000 is nothing but a ripe off and it makes it real hard for those who can’t afford 800 or 1000 for a bottle it’s just like the insulin market but in this case no one dies and now we have retail stores starting to sell at secondary prices it’s bullshit
Fuck the secondary market to take a bottle that sells at retail for 49dollars and then put it in the secondary market for 800 to a 1000 is nothing but a ripe off and it makes it real hard for those who can’t afford 800 or 1000 for a bottle it’s just like the insulin market but in this case no one dies and now we have retail stores starting to sell at secondary prices it’s bullshit not to mention I know people who have been ripped off using bottle spot with no way of getting their money back like I said at the start of this post FUCK THE SECONDARY MARKET
It is an abomination. Trading is fine but people who buy bottles with the sole purpose of selling them at higher prices should be shut down. Everyone needs to unite and stop paying these obscene prices and the secondary market will collapse. Its not like you can’t get great bourbon at retail that’s always available (Blantons, Bookers, Basil Hayden, etc) – so drink these until you luck out and come across a rare bottle at retail. Please don’t encourage non-bourbon drinkers to buy up these few precious allocated bottles at retail only to sell on the secondary market – by eliminating the secondary market the allocated bottles should become more common at retail.
While I agree with everything you just said, commerce is alive and well. As long as there is a profit to be made, there will unfortunately be people out there taking advantage of that. Which at the end of the day, means less retail bourbons that we used to be able to find more readily available. Regulations, distiller/bottler crack down, supply catching up… all things that will eventually even the secondary market out (somewhat). Flippers and the dark side of the secondary market isn’t going away. It will just adjust to new methods, vehicles and avenues to accomplish their goal as the bourbon environment changes.
I think it’s been pretty clear — my feelings on the f’n flippers that is. The secondary market is COMPLETE BULLSH!T!!. Now we are seeing empty bottles of VW & BTAC being sold on Ebay for ludicrous prices, & as Blake said “You really think that 400.00 empty bottle is going up on a shelf?” (Not a Direct Quote – You get the idea). Guess where those are going to end up…PATRICK!!?? A re-sealed bottle labeled VW 23 full on the cheapest bottom shelf swill avail!! So, Hey Pat — thanks for giving these lowlifes another outlet to rob the unsuspecting!! No really I mean it!! Thanks!! This also effects BT & VW — it takes will seriously hurt their good name & product reputation!! It’s a bad scene man. If you dig good hooch, it’s only going get worse. As Blake stated above, he hates to see a bottle go up for a flip from the parking lot of the store it was JUST purchased at. There is also the ScumF*cks that list the stuff on BottleSchlock & right behind the pic of the item for sale there will be a TABLE FULL of limited run stuff (that should be out in the open market for real enthusiasts. What can we do about the 2nd market — Bourbon will never be “unpopular” again. It may calm down, but you’ll never (most likely) see VW ON THE SHELF for weeks at near retail again like it was 10–>12 years ago. It’s up to us all in this community to educate everyone we know about this. That’s all we can do (that & of course NOT BUY from the 2nd market &, oh yeah, if you see it on the shelf at a asshole-ic (new word!!) price — LET IT F’N ROT!!!!!
I got to learn to proof read better…:)
Obviously, the general idea of supply and demand escape you. Nothing in your incoherent rambling added anything of worth to this page. Patrick, is attempting to establish a community of educated buyers, sellers and traders. He explicitly states, “There is a massively off-balance supply and demand issue with bourbon right now, and until either supply corrects, prices will correct. Our goal is to bring people over from Craig’s List where anything kind of goes, as well as from retailers asking upwards of $3,000 a bottle for this year’s Pappy 23. For what it’s worth, we’re also bringing back vendor listings at some point soon so everyone’s playing on the same field. One the more frequent, and most valid criticisms we’ll get is that some bottle on our site for 2x retail is over at Binny’s for retail (with a case discount!). We don’t benefit from anyone overpaying, and we want potential buyers to know about that deal at Binny’s.” To me, this sounds exactly like the kind of education you think the market can do on its own. No one is being educated by your post, and sadly, most of the time, people on the secondary market sound exactly like you. Take an English and an Economics class than try to educate with factual data.
It’s evident that a nerve has been touched here…Good! By the way, you’re no where near correct. The thieving second market is built upon ideals of “everything is for sale and it’s all about profit – no matter the cost”. You can cry about “supply & demand” all night & day – it don’t make it right! The Thieving Second Market is now driving the retail market. Shop owners (not ALL but SOME to MOST) are basing their prices on what they see these going for on “Wine Scalper” & “Bottle Schlock”. In some cases the distributors are getting into the mix buy charging the retailer 3 to 6 times over their cost (EMPIRE!!). The retailers don’t want this stuff being “traded” around, so they radically over charge for the merch. No point in leaving any “meat on the bone” so to speak for the F’n Scalpers & Flippers. Now due to “Wine Scalper” & “Bottle Schlock” there is budding counterfeit market based upon & directly resulting from sites that promote the outlandish prices shown on these. Those of who have been drinking this stuff since you were probably still teething & those out there who have a genuine interest in the products (old & new & still to come) are annoyed at what the Thieving Second Market has birthed. It’s driven a simple once a year pleasure for the average “Joe” to a commodity being shuffled around like gold and oil at prices that most of us (that is of course, if you weren’t dropped on your head as a child) find not only ludicrous but insulting. So, pretty please, with sugar on top, for all of us old timers… move on to something else kiddies! Lets us have our whiskey back.
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I hope you’re taking medication for this rant… 🙂
Agreed, Jason.
I have been a casual collector/consumptor of Bourbons for more then 12 years now. Not for resale, but for trading and consumption purposes. I was recently in RI and found the full rack of all Pappy’s and the latest 2015 releases of the 17 year series that Blake published a while back. Located on the highest shelf in the store, I talked with the owner, whom purchased all of them from a private collector for the sole purpose to quadruple his money. Not one of those bottles was under $1000.00. Ridiculous! the unfortunate this was that it was in a very wealthy town, where paying that prices they wanted wasn’t as hurtful to the wallet as it is to the rest of us.
I’ll trade. I have a ton of Weller, Weller 107 and a fair amount of Pappy. whatcha got?
take care!
Michters 10, Pappy 12 and Elmer T. Lee. Looking for Pappy 20 (yeah I know good luck), Weller 12 and any BTAC.
Nice. You were about 5-7 years ahead of most everyone else on collecting. I used to scoff at the E. Craig 18 prices when they were sitting on the shelf all day long.
This all sounds an awful like concert tickets and scalpers. I’d suggest the stores and distillers do some research into how the live music industry has worked to combat this same issue. With the advent of places like Stubhub that battle is also ongoing, but it offers some interesting ways to start.
But at the heart of the problems relating to this issue, is corruption. across all levels, if you work to reduce the possibilities for corruption then you help solve this problem too.
A bottle registry is one idea, wristband lineups and forced limits for on-sale dates is another. You could go so far for the big boys as to require photo-ID per sale and have person’s name and photo printed onto a label that’s fixed to the bottle in some permanent way.
We need ways to eliminate the idea of limited release bottles disappearing out of the back of stores instead of being put onto shelves. We need to get those newly released rare bottles into the hands of people who want to drink them, rather than scalp them… so revising bottle-selling practices is the way to go. That’s where BT could step in and crack down. By personalizing the bottles ahead of time, taking orders online, even potentially vetting the customer even in advance (of course that’s a massive time/resource waste, but if they could figure out a way to do it, then they’re golden).
What you refer to in bottle-buying for antique bottles is a different story altogether and I agree those should remain on a secondary market site.
I don’t know… this post was just riffing. But there’s lots of ideas and ways to help have an impact.
I’ve heard of an owner who tried to do the right thing by their regulars with an interesting twist.
If they dont know you they offer two prices, one for opening the bottle in front of them and one for taking it out sealed….Don’t know if it ever happened but hearing it made me smirk….
If you leave the liquor store with an “open container”, you’ve just stepped into another set of problems!!!
I buy often. Started collecting things I enjoyed in the 80’s. I’ve consumed 5 bottles of Pappy, the WLW 19 from 2001, Vintage, Parker’s Heritage. I’ve had all of them. I can’t afford today’s prices but I love the bourbon attention, conversations, and private tastings. The place where I normally buy was bought up by a chain, they don’t care about my love affair with their product. But one small store owner does! I buy, open it and share it with anybody in the store who wants a sip. The guys selling bourbon often have never seen a Pappy 23, much less a taste. I leave duplicates on the shelf to make somebody’s day better. But I’m not imposing my world onto anyone. I’m all for supply and demand. But the days of walking into a store and getting the hottest item on the new stuff is gone. We won’t see it again. It’s no different than buying Google stock. Wish I had. Even poor bourbon lovers, or economic challenged folks can enjoy stuff today like never before! That’s the good side. McKenna gets allocated, buy a Mike Drop. Or buy anything else that you can afford. If I like something, I’ll always have 2-3 bottles of it. But sharing doesn’t guarantee the Bourbon Gods will reward your behavior with Great Karma! But my small store owner and people who work there save me things like Weller 12, and they love it when I bring cookies, cheese platters and stuff to make a tasting better. For angry people out there, it wasn’t fun 2-3 decades ago loving a product and drinking alone, everybody else thought bourbonrs like me were nuts! Go find a great bottle, find a good bottle. Store picks are great. Get in a group and enjoy what you can. Wanting what you can’t have, get, or find is as silly as asking Parker Beam to be the Easter bunny. There is no Easter bunny, and Parker is dead. But he would’ve said “have a great pour”
If you don’t like the secondary market, I suggest you learn to accept it as a form of capitalism. The same markup has always applied to objects with small supply and high demand. I can remember paying crazy prices for a Ken Griffey Jr upper deck rookie card knowing damn well someone just got it in a 0.99 cent pack at Walgreens. Cabbage patch kids, Jordan shoes, the list goes on. And just with any of these, you want to protect yourself by purchasing “authentic” product, so do your research and buy from a trusted seller.
But if you are willing to pay $1,600 for a bottle of something, wouldn’t you rather your money go to the people who actually make the stuff, instead of some “capitalizing” shmuck who was abusing their position, or profiting off their luck?
Personally, I’d rather see the distillers make all that extra cash, and continue to remain profitable and producing better and better quality product (or increase output) for years to come.
Rather than line the pockets of a bottle-flipper.
There are hundreds of great bourbon choices on all shelves. If you have a problem with the secondary market and limited edition bourbon, don’t buy it…
Ultimately, that’s YOUR only option…
Getting upset for market conditions beyond your control is a losing battle…
I enjoy a bourbon and rye just as much as the next person. I have purchased things on bottle spot at or below market value. If someone is willing to pay over market for a bottle…so be it. If someone is re-selling for a higher than market price and there is someone willing to pay for it…so be it. No one is holding a gun up to the buyer or seller and making them do it. Its called free will people! For those like myself in Arizona who get a pretty low allocation of the good stuff the secondary market is a good place to pick up things. So if you don’t like it don’t use it but stop complaining about it because its not helping anyone.
Amen…
Bullshit I’ve never seen anything at or below market value so don’t try to pull the wool over our eyes all the secondary market does is inflate prices even at retail stores all because of the secondary market
Personally, I try to pretend it doesn’t exist. Knowing the value (trade or $) of the bottles I own causes me to hold them longer than I should…even covet them.
Before being aware of secondary values, I’d open a BTAC or Four Roses anniversary because I wanted to and drink it…now everyone uses #LostProfits as a real instagram hashtag because anytime you drink a 21 year rye, you’re basically losing out on a car-payment. Really absurd so even for those of us who aren’t in the selling of Whiskey, it’s had an impact on our perception.
I buy all of my whiskey in stage-controlled liquor stores (NH/VT). Pappy 15 was $85, 12 was $55 and BTAC were $75 (up from $55 just a few short years ago). So when I open one, I really want to never know what someone else would pay for it.
How recently were the Pappys and BTAC in the NH stores? I haven’t seen any of them there for a long time.
I have to say that all you guys make great points and I think the secondary market is here to stay whether we like it or not. I personally wish all people who purchase bourbon whether from your local liquor store or the secondary market would just open up a rare bottle and try it. Many of the sellers in secondary markets don’t consume bourbon and have little knowledge about what great bourbon is or isn’t. Even people who have rare collections with dust collecting on the bottles will never truly enjoy what’s inside. With that being said I’ve had the privilege of tasting most of the VW products and I’ve tasted some of the best Stitzel-Weller juice left on the planet. However, there are still some great bourbons left that I thoroughly enjoy throughout the year that compete with VW, BTAC, etc. Truth be told, I had VW 15 and 20 year last week, and I would not pay these ridiculous prices we’re discussing. Is it great bourbon? Yes! Worth $1000 per bottle! Absolutely not! Unless you crap $100 bills or get lucky snagging a bottle that you aren’t afraid to open then we’ll continue writing about a buying/trading system that will never go away. Best of luck in your search for great bourbon, but venture out and try the ones still available. Trust me, there are great bourbons still readily available. Enjoy them while they last!
I have the best solution – when someone buys an allocated bottle at retail, they should be required to open it – that will eliminate the secondary market. An open bottle of bourbon lasts forever so no downside the enthusiast who is buying it.
Well I think it does oxidize (or change in some way) after being opened…
Metal oxidizes not spirits
Then you’re forcing people to drive with an open container which is illegal in most states. Bourbon does oxidize once it’s open the affects would be less for an open full bottle but there would still be a noticeable difference if you let it sit log enough. Finally, what if it’s a gift? Nothing like showing up with an open bottle as a present.
Well, no – it lasts until it’s consumed. Then the empty bottle might last forever, unless it’s broken :-O
The makers of hard to find spirits should start selling in 350ml bottles then theirs more to go around and maybe it would shut down the secondary market
I am rather new to the bourbon field, so I can’t say much having only collected for about a year or so, but I will say this. Several months ago, when the new Pappy allocations were being talked about I spoke with the gentleman that I purchased a goodly amount of bourbon from about the Pappy fuss. Let me preface this by saying, as Blake and many others have said, I had developed a relationship with this man. I bought from no one else and treated him to an occasional passion of his when they came up, no big deals, just some goodies that were mentioned in general conversation. He loved the idea of, as business associates ,he and I could be friends. To make a long story short he started to turn me on to some of his allocated bourbons, I bought several and built new shelves in my bar to accommodate them. The collection is a thing of beauty for the eye and the taste buds. I also did my fair share of research and passed on some. When Pappy time came, I hit the trifecta with my man and was able to buy a 15, 20 and 23 at retail this year. I won’t sell them and won’t open them for awhile. It is not a pride thing, but don’t get me wrong I am very pleased, but it is a hobby for me that I share with my son and a few close freinds, I’m a retired guy so a I guess at my age it’s like having an antique car or gun. So let capitalism flourish if that’s your thing, it is America you know…..and so is great bourbon, great sipping ahead.
I’m not a fan of the secondary market, but that’s not to say that I don’t find it interesting.
I have no problem with someone paying whatever they think a bottle is worth if they are planning to enjoy the contents. What I do find issue with is showing up at a store that I go to several times a week to find that a flipper has been following the delivery truck around all morning buying whatever rare releases are available. If that person is a huge fan of the product and intends to enjoy it [either consumed or collected – who am I to judge], good for them, they were more diligent than me in their pursuit. However, seeing that same bottle online a few hours later at a 2.5x or more markup kills me. I’m happy to pay retail, but can’t really rationalize the secondary price. Ultimately, the individual stores are in a position to cut down on this behavior. They could reserve the right to sell to regulars and ignore the flippers. Trust me, most independent liquor stores know who is who in regards to this.
All this being said… As long as there is greater demand for a product than supply, there will be a viable secondary market. The only thing that will change is the margin.
This is why I hope stores take a little more responsibility. Sell to your best customers or at least faces you’ve seen buy from your store before.
This year I got 3 THHs, 3 WLWs, a GTS and a Lot B. I paid $120 for the GTS and one of the WLWs, and $59-$70 for each of the rest, and I purchased every one from a store. If you are buying on the secondary market, not only are you keeping prices high, but you are likely buying counterfeit goods at some point. There are soooo many fakes out there now; why do you think someone is buying all the empty PVW bottles?
Is there an easy way to spot counterfeit PVW bottles?
Not that I know of, as the cork tops and capsules are readily available for pennies to anybody who wants to cheat.
Yup. Huge issue in the wine business (here) https://en.wikipedia.org/wiki/Rudy_Kurniawan.
It really sucks, but then again, if you choose to buy from the secondary market, you put yourself in this situation of receiving possible fraudulent goods. I will only buy from friends, or friends of friends.
So true
NOTHING infuriates me more than a crotch shot of a bottle that someone is selling 5 minutes after buying it at a store, or a guy clearing the shelves of a highly sought after bottle then posting them all for sale that day. BUT – with the bad comes some good….
I was able to build my collection through the secondary market. Luckily, most of the building was before things got really, really out of hand. However, as I see fill levels on my JPS21 and EC20 getting lower and lower….I’ve got nowhere to turn except the secondary.
I suppose the question is; what defines flipping? Spend enough time in some of the FB groups and you’ll see there are some generally accepted, albeit unspoken rules. But the line, if it exists, is extremely thin. Sell one at 3x retail to pay for another – that OK? Triple your $ on a bottle you bought this morning because it’s new an desirable – that OK? Pull a bottle out of your bunker and sell because the market has increased over the years – that OK?
There are two sides to the secondary/flipping market, and I’m not sure you get one without the other. The good news, as with all hobbies, things generally even out at some point. Probably going to be a little while till bourbon cools off, but until then you can educate yourself, keep hunting, try not to OVERpay, and keep drinking.
Cheers
The secondary market is what it is. If you don’t like it don’t participate. If it weren’t for that I would have never tried a 1975 OWO gold vein. Personally I trade and drink. I have never sold a bottle for cash, but like to have the option if needed. Any commodity with scarcity will have a secondary market. When supply comes back in line, prices will drop and many of the flipper/gougers will be left holding things that will result in a net loss. The best defense as a consumer is to find a “local”, get to know them and support them all year. You will find that this is your ticket to getting the hard to find gems at retail. If you are one of the many people who show up in a store when you see a release then you will have to go without either that bottle or a lot of your cash…..
This secondary bourbon market reminds me of the Harley market. You had to get on a list at a dealership and then you got your bike when it came in. A lot non riders were seeing how much money could be made flipping new Harley’s. Then the Harley market crashed and a number of new bike owners lost money on bikes they bought to be flipped.
I keep thinking what goes up will come down. Look at the stock market for the week down 100o points.
How many people bitching about not having anything they want, put effort in getting it? Everyone wants pappy not everyone will stand in line to get it, I did three times and got a 10 at one a 15 at another struck out at the third. I wanted a 20 I’ll try next year. It sucks but is obtainable with work, Weller 12 and ETL are my favorites I get them twice a year in a state far away, and just bought another ETL this week on secondary market for 50 dollars pretty fair I thought.
Bottlespot, who are you trying to fool when you say, “Our goal is to bring people over from Craigslist where anything goes…”? You are part of the same (if not worse) hypocrisy by REGULARLY using social media (Twitter) to hype/Promote and encourage stupid crazy inflated secondary prices. Reading your Twitter posts is like listening to a freakin circus barker. Your tactics are borderline collusion and are at best boiler room pump and dump schemes that are only meant to benefit your own selfinterest. Face it folks,the fact is that there is no REAL secondary “market” just a hand full of greedy charlatans trying to take advantage of and profit from a few fools who don’t know any better. I mean seriously, no one but an occasional idiot is paying the crazy prices that are being offered on Bottlespot, CL or FB. Those are the facts. To claim otherwise is just b.s.! Don’t let these guys fool you.
I’d like to hear your definition of a market? Like it or not people are paying inflated prices for bottles. You’ve so slanted your comments that it’s almost impossible to respond to rationally.
The primary market is waking up fast to this nonsense. Stew Leonards was selling ECBP for $99.99 yesterday. Definitely noticing the stores jacking up their margins BIG TIME on the hard to find ones.
Absolutely!!! They see prices on “Wine Scalper” & “Bottle Schlock” & charge accordingly!!
All I’m saying is that Bottlespot/Patrick is crossing the line by regularly using Twitter to pump grossly inflated asking prices for crap that’s not selling at his site, thereby misleading newbies who don’t know any better. I don’t see the CEO of Craigslist setting up shop on Twitter 24/7 trying to pump and dump high priced garbage that’s not selling on CL. Do you? It’s so obvious that Patrick is using any means necessary to pump and dump over-priced junk to push product thru his Bottlespot venue that is not selling. Bottlespot could be a good thing, but it’s being dicked up by trying to pump/promote prices dictated by greedy flippers who have collectively cornered supply. Hey Patrick (and to some extent Blake), thx for being cheerleaders for the flipper and misleading newbies to get ripped off. Seriously, who the fu** crowned y’all Mr expert market makers??
There is a place in Northern NJ that has all the Pappy in the front, all the BTACs, EC18, etc etc etc…………….every one of them he is charging secondary prices.
Also has endless bottles of ETL for $60, and ECBP for $120s.
Insane inventory, more insane pricing.
And won’t budge on prices…………….
Stew Leonards in CT? I remember when the only beverage they sold was milk! :-/
Absolutely right! I’ve seen it, even in state run stores…the prices on these “hard to find bottles” are steadily rising in the retail stores….. everyone taking advantage of this bourbon BOOM! You’d be a damn fool not to.
With all the piranhas on Craigslist, it’s refreshing to see bottle spot trying to legitimize the secondary bourbon market with their verification process…
Collectible bourbon is fairly new for most, but I think it’s a lot more interesting than Beanie Babies, and the bottles worth owning or coveting were not produced in the millions…
Many of these “sought after” bottles are limited to 10,000 bottles or less… with bourbons increasing popularity, limited editions are a collectible out of the gate…
Face it folks, those that rant and rave about the secondary market, have an axe to grind. They either cannot accept the fact they are unable to pay the price for the bourbon they crave or are living in the past prices of bourbon. Grow up and either pay up or stop whining………
We live in a world of have and have-nots. Reality. It is only bourbon, not shelter, water, food. Only a hobby.
Myself, I will just be happy when I find a nice bottle, after days and hundreds of miles of searching (even leaving my state multiple times). I have also learned to enjoy readily available, inexpensive bourbons, ie: Booker’s, Knob Creek Single Barrel , Russell’s Reserve Single Barrel and so on……..
IMHO. . .
I have to say it seems like the inflated bourbon prices are here to stay. If there were only a couple going for $1000 that would be easier to correct. However, there are now MULTIPLE high-end bourbons going for $1000 + (Pappy 20, Pappy 23, Michter’s 20, Michter’s Celebration) and a LOT of bourbon going for ~$750 (WFE 20 + yr old, Fitz 20, Older BTAC, VWFR rye (I know its not bourbon), etc). The idea that no one is paying these prices is unfortunately a position grounded in ignorance. I wish it weren’t so, but expensive premium bourbon is likely here to stay. The only ones that may go back the other way would be the Weller 12/weller 107 antique etc. that are going for $50-100 in recent months. However, I figure those are scarce because distilleries are shifting some of their lower end supplies towards higher end production. This is why those prices are also likely to remain. The only thing that could change all of this would be a paradigm shift where a majority of the public decide they no longer want to buy bourbon, in ANY form. Then there would be glut of the bourbon supply ala the 1980’s and prices would eventually drop. However, that would have NO effect on older/limited release bourbon because those supplies are in demand amongst people who seem to be lifelong bourbon drinkers and are unlikely to ever just forget that.
If somebody is willing to pay whatever it’s worth to them, then what’s the big deal? Who really cares? It seems like most of those way overpriced bottles sit in their happy little add anyway and the “flipper” has overhead that he paid for and not making any money off it. My problem with the secondary is that the retailers are jacking the prices up to those prices as well. Also, some distributors are making stores jump through hoops to get the stuff and screwing other stores as well. At least the secondary is putting somewhat of a value on the bottles, which I take in consideration for trades. Don’t buy it if you aren’t going to pay those prices and quit being jealous over some asshole who has some awesome connection that can try to sell GTS for $650 and Pappy 23 for $2500 and do each x6. Those are the adds I despise, just because I wish I had that connection.
The secondary market is entirely necessary.
Indeed, it is the ONLY way some of us can procure any of the finalists from whiskey of the year lists, BTAC, and plenty of other bourbons. The stuff just isn’t available in some places through normal retail channels.
Following is repost of above post since it was chopped and difficult to read: All I’m saying is that Bottlespot/Patrick is crossing the line by regularly using Twitter to pump grossly inflated flipper prices for crap that’s not selling on his site, thereby misleading newbies who don’t know any better. I don’t see the CEO of Craigslist setting up shop on Twitter 24/7 trying to pump and dump high priced garbage that’s not selling on CL. DO YOU? It’s so obvious that Patrick is using any means necessary to pump and dump over-priced junk to push product thru his Bottlespot venue. Bottlespot could be a good thing, but it,s being ducked up by trying to pump/promote prices dictated by greedy flippers who have collectively cornered supply. Hey Bottlespot/Patrick (and to some extent Blake), thx for being cheerleaders for the flipper and misleading newbies to get ripped off. Seriously, who the fu** crowned y’all Mr expert market makers??
I’ve got to say. Its also what you make of it.
I haven’t sold anything through bottle-spot and am now looking to make my first buy, at just about 2x retail for a previous years release and an export only item. Sounds like a lot? Thats what i would be willing to pay in most stores for this years releases.
I’m also up to 4 successful trades and counting. Would have been more if I was more open to ship.
I’m happy for this site and that one. Where i can learn about things and work out trades I’m willing to do with like minded folks.
Oh, and since the BTAC thread it done I have to say the new “better” way some states like NY are releasing stuff is a joke. Can confirm with 100% certainty some stores got BTAC and VW this month. Many weeks after the state wide releases. These stores did not get it in the first release and regardless of how much whisky they order or sell if they didnt get stuff the first time than they can order it now. Meanwhile they stores that have been ordering it for years that sell a ton of BT/Sazerac products that dont gouge arent even allowed to order it again. Way to go empire (or southern, whoever the f*ck it is) job well done on your way to fairness/socialism.
So I walked into and out of a store today with a ER 17 for $650, VW12 for $350 and I didn’t bother to ask about the Handy. They sold their VW15 last year for $700. They also got their baby saz rye, OWA and ETL.
Sorry, I should have added but posted too quickly.
This store did not have any of that stuff last month. And the other stores that normally got stuff and received it on time were down 2/3 this year…
EMPIRE sucks!
Retail stores price gauging is indeed a problem. But secondary market, just as anything else rare you have a choice to involve yourself in it. If you have a problem with it, then don’t go on CL, BS, or WS. If you are spending your time “hunting bourbon” on these sites expecting to find a bottle at retail, you need to wake up. Go make friends at the local stores, score your rare bottles, and enjoy them. You also need to consider that if you are a collector there is a good chance you have a few bottles you are willing to part with, in that case take advantage of the secondary market for trading. I am willing to bet that 75% of listings on bottle-spot (even though not stated) the seller is open to trades. Everyone has a right to enjoy this hobby as they please, if that is making friends at every liquor store in a 60 mile radius of you, or if that is you paying $3000 for pappy on-line, that is your choice and it is not going to change.
A reasonable/logical comment! That’s refreshing
Are you saying that it is difficult that you are surrounded by idiots?
Not idiots. Just guys taking a hard stand on “it’s the free market!!” or “death to all who sell a dime above retail!!”. As with most debates, there’s a middle ground.
I don’t necessarily care for the secondary market either, but I have bought bottles off of it…bottlespot is my go to when I’m looking to buy something that I can’t find in the retail stores….although, it’s ridiculous to pay upwards of 10x’s msrp for a bottle of hard to find/allocated stuff, I do when I feel the secondary price is “fair”. I’ve bought an Elmer T. Lee commemorative, a midwinter’s night dram act 3 so far….I’m contemplating purchasing a FRSMBLE, but still trying to decide if I want to pay $350 for it. Probably not at that price…but I’m still looking….everybody looks at the secondary markets….to buy,trade and to sell…something. If people say they don’t use the secondary market it’s because either they’re rich and don’t need the money earned flipping and can directly aquire bottles from a “reliable source” …..or, Second, whiskey drinkers just happily drink what’s obtainable and available on a regular basis on the shelves in a store and are content with that. Even wealthy folks go on the secondary markets to buy rare bottles they can’t find in retail stores……..I quietly applaud the secondary market.
Look Blake , you know as well as I that no one is paying the rediculous asking prices of $350 for rot gut NAS orange label Black Maple Hill, $300+ for bottom shelf Elmer T. Lee and $1000+ for any hit or miss Pappy,etc.. No one is paying those prices for that crap ( other than an occasional iidiot) like you claim. Those are the facts. Prove otherwise. (?)
Orange BMH consistently sells for $300. One of the worst values I think there is but you can get someone to buy at that price pretty much any day of the week. I hope no one is paying $300 for ETL. I’ve never seen it happen either. Pappy 20 is creeping around the $1k mark and Pappy 23 has been selling for over $1k for close to a year now.
Granted, I still think it’s a small percentage of the bourbon community as a whole that are paying those prices but people are paying those prices. I don’t think you really want proof. That’s the reality of the situation. People are paying insane prices for bourbon. Not as insane as some store owners would like us to believe but still insane.
I can’t imagine Orange label BMH ‘consistantly’ selling for 300+. Afterall , it was discontinued because it was a poor selling low grade and high price substitute for its popular predicesor. You say it is consistently selling at incredible prices yet provide no real data to back up your claims. The fact is that the premium secondary bourbon market is COLLECTIVELY controlled by petty nickle and dime would be profitiers. Whether it’s a store or an individual, they know that they can ask $600 for an $80 bottle of GTS(or whatever else) at their store, on CL or BS (Bottlespot) until one dumb ass comes along and pays. The seller makes around 700℅ profit. With a profit margin that high, time is on their side so they don’t mind letting it rot on the shelf knowing that all it takes is one idiot to pay the insane price. Multiply that by 1000’s and that is where 99.9℅ of the premium Bourbon allocation ends up each year. All the good stuff is collecting dust on BS , CL or some low end retail store priced for the one-off newbie who has more money than brains.
MJ, I was trying not to get involved but you are clearly just venting for the sake of it.
Part of the reason BMH-orange stopped was because KBD was no longer going to supply for them (partially because their business has exploded). Thats why the last BMH-Oregon was of even lower quality. And is it better if after they negotiate over the price a little it sells for 250$? I mean I have talked to people who have bought and sold them. I traded for one. May open it, may trade it to someone else that wants it.
And your whole secondary market argument is just over the top. You say petty nickle and dime in one sentence and then curse their 700% profit margin. Which one is it? And there are plenty of these sellers that I am sure buy that GTS for 400 and then try to flip it for 600. Not exactly 700% on those.
I do like the demand for data. Can you supply data that says no one is paying those prices? You know he cant but pound away for proof. BS is not the seller, they wouldn’t know what sells or doesn’t unless the users report it. Meanwhile you cite the proof yourself. If these guys wanted to make money and no one was buying then you would think they would lowed their prices, even if after a while.
The one that most off though is that 99.9% comment. You know thats not true. Just based on what posters here scored, probably you as well, and others I know and talk to/trade with and what I scored 99.9% while blusterous is way overstated.
Incidentally, is it possible that a non-newbie might fathom buying something they really want at after market prices even if they knew it was way over retail? Or not possible? Is it ok with you if they know what it cost and what it goes for and still choose to buy it?
Somebody give Lu a f#@king bottle and pacifier for his bourbon. They should call this the bourbonbitchblog. Most people, who cosider themselves pappy conisouers couldn’t find enough to supply them year around anyway before this craze started. Most of y’all that complain are probably too lazy to call or visit more than a store or two anyway. Blame the secondary market, blame Bottlespot, blame Obama. You should be blaming Sazarec, Buffalo Trace, or Pappy. They create the best bourbon in the world and then don’t create enough of it creating a frenzy with their lack of supply. With every interview the Van Winkle’s or anyone associated with them do only fuels this fire and/or demand. Three years ago you could go to their website and select from one or two hats or shirts and that was about it. Go now and look. Their whoring out anything they can put their name on. Flippers may be jacking up some prices and taking bottles from all you Pappy “OG’s” but the one benefitting the most from all this is Pappy himself. Don’t be fooled by their press releases damning the secondary markets and shit like that. They love the craze and hype and $$$$ that comes with it I assure you!!!
Hi… Yeah… Anyhoooo… Most of us (I truly believe this AND, anyone who does – please back me up here), when allocated product is released, spend alot(!!) of time running around like mad trying to track down the product (it used to be kinda fun — talk to some Cats, build connections, find other gems). The frustration comes when we do find the product & it’s so astronomically priced that the effort was all for naught (because of the prices “set” by the flipper market). I don’t mind paying 2X retail & in some cases more if the store is somewhat grounded in reality regarding it’s pricing. Also infuriating — when you spend all year dedicated to one particular retailer who knows you are a connoisseur of fine bourbon – the season starts – you’re shut out because some rich wank buys a few cases of bordeaux & heard about this “Pappy stuff” from a magazine article and gets a 15, 20, or 23 (or whatever). We’re asking for reason in pricing. We’re asking that the retail market prices NOT be driven by flipper market prices.
You get rid of the flippers by reducing their outlets (OR STOP BUYING FROM THEM!!). You can say that this is “bitching” (and, yeah, kinda is! — thanks Blake for the outlet!!). But the more we can get passion stirred up – the better. AND…BTW… “Pappy” as you call it is NOT the “best bourbon in the world”. It is the most over-hyped! It is the most sought after! BUT, good sir, it is certainly not the “best”. The “BEST” is the individual preference. Yeah I dig VW sure — But the best in my house — gimme WT101 am I’m a happy man! OWA107 is also quite a treat – pick that up whenever I see it.
I for one did a lot of miles and time before and after the release dates in two states and many, many stores (mostly misses). Also probably why my number of hard to find bottles increased greatly from last year (also an adherent to the 2x retail rule)
A good friend who’s an executive chef in Tribeca who is familiar with my bourbon collection recently told me his former business partne’rs ex in Franklin, TN knows a doctor who will pay “any” price for some of my holdings. I told him to tell his friends ex to tell her doctor to take his any price and shove it! These pretentious Bourbon snobs kill me. You see them all over Instagram with their ridiculous display of teenage bravado. Boasting about their low end Cuban ceegars, fine fast casual food, Rolex watches, cheap designer jeans, McMansions and other common consumer bs . Within their respective communities they’re defined as rich, yet their entire bankroll wouldnt buy them a rat hole in Lower Manhattan or anywhere else. Then there’s the army of parasitic petty nickel and dime flipping bourbon hustlers who follow them around suckling their tit. That’s the entire state of the premium bourbon market right now. It’ so freakin’ absurd it’s hilarious yet pretty sad how something so good and refined is debased in this way. In the long run, this sort of thing will ultimately hurt the entire bourbon industry.