.png)
Thirsty Thursdays @3PM EST
I'm a 20+ year veteran in the wine and spirits industry who loves innovation. I'm interviewing those who are creating it from agriculture to glass. We will deep dive into their journey and provide insights to help yours.
We will discuss their major industry pain points and outlook for the future. If my guest has an item to drink or eat we will try it throughout the podcast. Come on the journey with us!
Now On YouTube!! https://www.youtube.com/@ThirstyThursdaysat3PMEST
Thirsty Thursdays @3PM EST
đ¨ Thirsty Thursdays Q2 Industry Roundtable: From Non-Alc Growth to THC Beverages & Distribution Shifts Q2 Review đ¨
RTDs, THC drinks, NA growth, Gen Zâs return to alcohol, and the RNDCâReyes CA shakeupâwhatâs next for 2025? Insights from Uncle Nearest, Booze Biz & Business of Drinks đď¸ â¨@ThirstyThursdaysat3PMESTâŠ
Watch here on YouTube! https://youtu.be/NJwLcZqJ9Cs
This quarterâs Thirsty Thursdays roundtable brings Kate Jerkens (Uncle Nearest), Caitlyn LuBell (Booze Biz), and Erica Duecy (Business of Drinks) to decode whatâs really moving the beverage market in 2025.
đ What we cover
Macro pressure vs. ânon-essentialâ spend: Rising student/auto debt and delinquencies are squeezing discretionary purchasesâespecially for younger consumers.
Gen Z is drinking again: New IWSR Bevtrac data shows Gen Z alcohol participation rebounding toward other cohorts.
NA momentum (esp. beer): No-alcohol leads no/low with ~+7% volume CAGR through 2028; NA beer is surging globally.
THC beverages 101: Rapid retail growth (hemp-derived and dispensary channels), dosage strategy (2â5mg âsessionableâ vs. 10mg âvalueâ), and the Farm Bill/regulatory watch.
Distribution shakeup: RNDC exits California; Reyes and mid-tier distributors step inâopening doors for some brands and bottlenecking others.
Functionality as table stakes: Hydration, adaptogens, gut-health cues, and mood-positioning (âcalm/energy/focusâ) now drive trialâespecially in NA/THC.
đĄ Takeaways
Follow the consumer, not the category: RTDs, NA, and THC are winning because they fit occasions (casual, at-home, brunch, âzebra stripingâ).
Plan for compliance volatility: THC bevs = opportunity + regulatory risk. Track state rules and the Farm Bill timeline.
Rethink route-to-market: Mid-sized distributors can give brands real focus post-RNDC, but onboarding capacity is tight.
winebusiness.com
CTAs:
⢠đ Like if you value real-talk data.
⢠đŹ Comment: Whereâs your 2025 betâRTDs, NA, or THC?
⢠đ Subscribe for quarterly roundtables and weekly briefs.
⢠đ Share with your sales/marketing team.
Subscribe for data-driven beverage insights every Thursday @3pm ET, drop a comment with your 2025 category bet, and share this with a colleague who needs the update.
NOW ON YOUTUBE!!! Thank you for Listening! Join us on Facebook, Instagram or Twitter!
Host Jessie Ott's Profile on LinkedIn
Jessie Ott (00:30)
Hello everybody and welcome to Thursday Thursdays. I am Jessie and I have my crew here that we get together every quarter or so and talk about the industry and what are the updates and what are we seeing out there? And I'd like you guys to go ahead and introduce yourself. Kate, you want to start?
Kate Jerkens (00:47)
Good morning, good afternoon. I'm in Los Angeles. Hi, I'm Kate Jerkins. I'm the Chief Business Officer for Uncle Nearest Premium Whiskey.
Jessie Ott (00:54)
Caitlyn?
Caitlyn LuBell (00:55)
Yes, Caitlyn LuBell I am the founder and chief connection officer for Booze Biz, a recruiting agency focused strictly on the beverage industry.
Erica Duecy (01:05)
And hi, I'm Erica Duecy. I'm the founder of Business of Drinks, which is both an advisory service for brands as well as a podcast.
Jessie Ott (01:13)
Welcome everybody. Julie wasn't able to make it today, so we're gonna forge on with the four of us here. So we'll catch her in the next one. So I always like to kind of start out by looking at economic indicators and start kind of like looking down and then we'll dive deeper into the different categories. what I found, when we talked last time, which was after quarter one, there was only one
Kate Jerkens (01:21)
for them.
Jessie Ott (01:37)
of the seven economic indicators that were down. And that was consumer confidence and spending. And I'm showing that the year the yield curve inversion is an active warning as well as the L.E.I. decline in indicating risk. So I feel like we're not in a recession. I don't know if we'll ever get to one, but there's more risk that we that we will. And I'm pretty sure tariffs have a good part of.
the reasoning for that. Mortgage debt is rising. Credit card balances are up. And delinquencies are, like if you look at student debt, this is something I found very interesting. And I'll just pop this up so you can just take a look at it really quick.
I guess it makes sense, but debt in terms of the amount, the total is the auto debt and student debt are the same thing. 1.6 trillion. I was shocked. I mean, I know college is expensive, but we wonder.
Caitlyn LuBell (02:26)
Wow.
Jessie Ott (02:29)
why these 20 somethings and early 30 something can't buy extra non-essential goods like beer, liquor, wine, spirits, RTDs, whatever, they're debt ridden, right? And if you look at the 90 day delinquencies over here, they're all up over a year ago. So this inflation,
Kate Jerkens (02:40)
Right, wow.
Jessie Ott (02:55)
You know, the fact that feds aren't easing up that they don't want to, I guess I get it. They don't want to ease it too fast and then have it go in reverse like they did in the seventies. you know, I just, thought that was really interesting because it kind of tells the story, we were talking about Erica's podcast that she, had, with Bourcard at Robobank and they're talking about why young kids aren't, purchasing as much and
This is kind of an indicator of that, right?
Kate Jerkens (03:21)
Makes sense.
Caitlyn LuBell (03:21)
They can't afford
Erica Duecy (03:21)
Yeah, absolutely.
Caitlyn LuBell (03:21)
it, right?
Erica Duecy (03:22)
Yeah.
Jessie Ott (03:22)
Yeah. And then just if you look at debt and per capita debt, it's all up. And then obviously the delinquencies as I just as I just showed. So in other words, the economy isn't bad. We're still we're still adding jobs. You know, that's good. Unemployment, I think, is around four percent. So all in all, it's not bad. It's just,
Kate Jerkens (03:25)
Interesting.
Jessie Ott (03:43)
when you live in a category that's not essential for life, you know, it kind of puts things into perspective, right, of where the pressures are on the economy and different sectors of people. And I don't have to go through all of this. we all know where the growth is, right? It's the same, same, don't see anything really different or changing from THC,
RTDs and NA beverages. I know that when I go and I look at the top brands and I'll show you, it's the same ones. You look at the top selling brands, most of them are in serious decline. I mean, this column right here. And then when you look at the top selling brands, here.
Sorry. What is it? Buzz ball, Surfside, Cutwater, High Noon, Car Bliss, Beatbox, Sun Cruiser. It's where it's at, you know? You got some tequila and some bourbon. Other than that, it's just all canned or RTDs or whatever. And this is from January through June. So is this kind of what you guys are seeing?
Caitlyn LuBell (04:32)
Wow, amazing.
Kate Jerkens (04:33)
you
Interesting. Yeah.
Yeah, I will say I had something really interesting happen. was meeting with a California based grocer talking about non-alc. And something that came up was shelf stability with non-alc beverages, which was interesting. And they were having to decrease, they had chosen to decrease their shelf set for non-alc because it's not shelf stable. So a lot of it starts to have to be, cause it's like there's a lot of juices and all that kind of stuff.
Jessie Ott (04:59)
Yeah.
Kate Jerkens (05:12)
And so they were, a lot of them were expiring before they were being sold. And so they were reducing their shelf set by half. And it's the first time I'd heard that, but it makes sense. Yeah, by half. And I thought that was very interesting because, well, the non-alcs are expensive, right? They're an expensive. Like when I look at some stuff I've tried, those are also quite frankly, luxury items in my opinion, like to buy.
Jessie Ott (05:12)
Yep.
Caitlyn LuBell (05:17)
I
Jessie Ott (05:20)
Wow, by half?
Wow, that's a lot.
Kate Jerkens (05:35)
I like I hate to say this, if when you could just drink like a Coke or like a glass of orange juice, but you're choosing to drink something that's like fancy versions of all of that together, that's a luxury item. A, B, then the fact that they are juice based and that they're gonna expire. I think it'll be interesting to watch that trend. it was the.
Caitlyn LuBell (05:41)
Right.
Kate Jerkens (05:55)
And this this was a high end grocer. and it was the first time I'd heard where they're like, yeah, we just can't afford to keep all of that on the shelves and watch it not move as quickly as it needs to move. I thought that was very interesting.
Caitlyn LuBell (06:05)
Wow.
Jessie Ott (06:06)
That is interesting.
Erica Duecy (06:06)
Yeah. I mean, I think
it really varies depending on what type of product we're talking about. Certainly juice-based products are going to have a shorter shelf life. But for a lot of the other non-alc, I mean, think that for non-alc, even though it's on a small base, like a billion dollar category versus a $500 billion category for alcohol, that's still where I'm seeing a lot of growth.
So non-alc is forecast to grow 7 % a year through 2028, which I think is indicative of this broader trend that we're seeing, is, know, across the board, American drinkers are really kind of leaning into moderation, but that doesn't necessarily mean like a dry January kind of way. It's more like light drinking and taking breaks and...
Kate Jerkens (06:53)
Right.
Erica Duecy (06:57)
you know, or could be like sticking just to one category per occasion. So it's almost like zebra striping, but across culture, not just for the Gen Z's. And I think it's, you know, that's, I think that's part of it. And then part of it is that kind of across the board, we're seeing a shift to more casual drinking moments. And that feels like a real opportunity. So like,
Jessie Ott (07:08)
Mm-hmm.
Erica Duecy (07:22)
the RTD's are having so much traction in this space. Even like Prosecco's or a non-alc sparklers are showing up at brunches, barbecues, backyard hangs. So I think there's like, there are glimmers of hope throughout the broad sort of drinks space, but it's really very specific, like brand by brand, example by example almost.
Kate Jerkens (07:45)
Huh.
Caitlyn LuBell (07:46)
And I'd be
curious to see the difference between on-premise, like if there was any way to track that, right? But like independent on-premise versus all like off-prem. So retail maybe is pulling it, but are more people drinking non-alcohol when they're going out or is it, you know, I always ask bartenders that I'm like, how's your NA section do? You know, and I get mixed reviews and it depends on time of year too, right? They're like, well, dry January.
Kate Jerkens (07:51)
Okay.
Caitlyn LuBell (08:14)
People were drinking a lot of the booze free stuff, but then they start drinking again in February. But I'm so intrigued. I always ask on-prem accounts, you know, I'm like, wow, you have a lot of NA options. Do they sell? And I kind of got responses across the board. So that's super interesting about
Erica Duecy (08:27)
No.
Jessie Ott (08:32)
you talking about a specific market or New York, Atlanta, Colorado?
Caitlyn LuBell (08:36)
No, I yeah, I asked
kind of when I go out when I travel and, you know, Denver and New York and wherever I just always kind of ask because that's the bartender in me, 18 year old bartender in me. was like, like, how are these drinks doing? You know, is anybody buying these? Who's buying them? I'm just so curious about the category because I it's not a category that I consume. So like if I'm going out, I want to drink.
Erica Duecy (08:51)
Hmm.
Kate Jerkens (08:55)
Yeah.
Erica Duecy (08:56)
Yeah, yeah.
Yeah.
Kate Jerkens (09:03)
Right.
Caitlyn LuBell (09:04)
But so I'm just more curious about it I don't know about it that much. And I'm not in sales anymore. And I'm not behind the bar anymore. So I'm always like, give me the skinny on how this is doing.
Kate Jerkens (09:09)
Yeah.
Right.
Erica Duecy (09:17)
Yeah.
Jessie Ott (09:17)
Yeah.
Kate Jerkens (09:17)
The
people I'm around the most people that I know that drink non-alc is really in the beer segment. Like my husband and I, like we made it, you know, we've cut that, you know, and he's loved the Athletic Brew. he's like, I had no idea that non-alc beer could taste so good. And by the way, it's made a huge improvement. Cause when I was, I remember being pregnant three times and ever always being like, I want a beer and have one. The old non-alc were not good. These are, some of these ones are great. And I've seen a lot more of like my, especially male friends who switched to a non-alc.
Caitlyn LuBell (09:40)
No.
Kate Jerkens (09:46)
here and beers, I think is interesting.
Erica Duecy (09:47)
Yeah, I mean, we have a new episode on Business of Drinks about â RationAle. I don't know if you've heard of this. It's RationAle Brewing, which is a non-alc beer, but it's like a craft non-alc. That's kind of a challenger for Athletic, but, I just did this interview with the founder, Jamie Fay, and he grew this thing only in eight small markets based in like,
Kate Jerkens (09:55)
No. Should I try it?
interesting.
Erica Duecy (10:12)
San Diego on out to kind of the regional area, but he grew in four years to more than a hundred thousand cases. just essentially like almost focused entirely in California and then just starting to spread out a little bit. so I think like the NA opportunity, for those brands who are being very smart and strategic and have a very clear differentiation point, like this is essentially like.
Kate Jerkens (10:21)
Wow, it's nice.
Erica Duecy (10:37)
the craft N.A. beer for, people who are, zebra striping between, they're drinking alcohol, but they also want something that is like fully on parity to what they're drinking on the alc side. So like those types of stories I'm finding and I'm like, wow, that's like a hundred and some percent growth year over year, So I think we, still are seeing those exciting sort of brand specific moments happen.
Kate Jerkens (10:59)
I think the Nod Alk beer looks to me, my husband is nearly 50 and he's like, at the end of the day, he's like, if I pour it in a glass to me, it gives, he's like, kind of realized I just like, it's almost like I drink decaf coffee now, because if I caffeinated coffee, I'm crazy, but I like the ritual of drinking coffee, right? And so I think people really enjoy ritual of coffee. You don't need it. I don't need it. But the ritual beer, and it tastes so good, you don't miss the other pieces of it, which I just
Jessie Ott (11:00)
Yeah.
I can't imagine cake. You don't eat it. â
Caitlyn LuBell (11:15)
Right.
You â
Kate Jerkens (11:27)
You know, I find it interesting. non-alc cocktails, I've yet to find one for me. I'd rather just consume calories differently, I guess, would be for me. But so I found some of them, you know.
Caitlyn LuBell (11:39)
See, that's me. That's how I am. I'm like,
I don't want all this sugar in the, no, I want something lower Cal, not, yeah.
Jessie Ott (11:43)
That's the problem with NA Bev. A lot of them have sugar.
Kate Jerkens (11:47)
Yeah. So some of the
ones that are coming out that are more kind of seltzery based and they have adaptogens in them, but no sugars and things like that, like Recess and some of these other guys, those ones I can get on board with. And I think mixologists are going to have like be tasked with figuring out how to make mocktails and to make these non-alc cocktails ones that are less sugar and more kind of about maybe what they do, like, like what the, what their benefits are because the sugar piece I think is going to keep it from being sustainable.
over time. It's a non-premise.
Caitlyn LuBell (12:15)
Yeah. Yeah.
Erica Duecy (12:16)
Yeah, definitely.
Yeah, I was, you know, I've been to so many conferences this year already. And the thing I keep on seeing come up across like sort of all categories is functional drinks. And I think like functionality is now becoming like a baseline part of drinks brands.
Jessie Ott (12:17)
Agreed.
Kate Jerkens (12:21)
Hehehe.
Yeah.
Erica Duecy (12:34)
You know, so like brands with hydration, immunity, digestion, energy, you know, this idea of longevity, promoting longevity, these things are just coming up over and over again in like all the presentations, all the breakout brand winners, like all these types of, â like any, any brand that's getting traction now, I'm almost like, okay, what's their functional benefit, right? Because that is just like getting people excited.
â And I think it kind of reflects â a shifting landscape. You we're seeing the GLP-1 medications like Ozempic. You know, we're seeing people just focused on hydration and on nutrition. And then that's just pushing demand for these types of things. So I think there's definitely opportunity out there, you know, I talked to a lot of THC brands and I'm like, okay, what's your functional benefit? Because that's pretty much going to be like the price of entry.
for that category moving forward.
Caitlyn LuBell (13:27)
Yeah, I just had the pleasure to go to the hemp beverage Alliance Expo event in Atlanta, Georgia. And it was so cool. I it was, let me tell you, it was, I have to say it's so funny at the end of like each day, I was like, the people that are
Kate Jerkens (13:36)
Was it lit? Sorry. Like, was it? We're sparking people. â
Jessie Ott (13:44)
Heheh!
Caitlyn LuBell (13:50)
a booze event and the people that are this event everybody was super chill friendly everybody was so nice and calm meme
Kate Jerkens (13:55)
Yo, I love it!
Jessie Ott (13:56)
Yeah.
Everybody's friends with
everybody.
Caitlyn LuBell (14:02)
The vibe was amazing. It was so chill. And, and like, that I was just laughing in my head thinking like the end of like New York Food & Wine Festival or like these big boozy events where, yeah, bumping into each other, you know, and this everybody was like, It was like, yeah, that's great. It was so cool. But I couldn't believe it. I mean, there were 150 tables. It was
Jessie Ott (14:04)
you
Kate Jerkens (14:05)
That's so
funny to me.
everyone's like.
Jessie Ott (14:17)
Yeah.
Kate Jerkens (14:20)
That's so funny.
Jessie Ott (14:28)
What?
Caitlyn LuBell (14:28)
It was insane. Like it was a giant room, two day long walk around event where I was going up and it was everything from sugar based drinks to seltzer based drinks to some of them tasted like you were chewing on a weed plant. And some of them tasted like you couldn't even taste the difference. And then some of them even had little drops or like a bottle of
Kate Jerkens (14:48)
Thank
Caitlyn LuBell (14:56)
booze, it looked like a spirits bottle, but it was THC that they're like doing like a topper on a margarita or on a non-alc drink. And they're just doing like a little bit of a topper on these non-alc or booze free mocktails, whatever you want to call them.
Jessie Ott (15:04)
yeah.
Kate Jerkens (15:06)
Interesting.
Was there
a conversation about the combination? And I'll tell you why I asked that because I was at Tales of the Cocktail for 20 hours last week, that's all I can tell I think I'm too old. But there are lot of signs everywhere about reminding people that combining THC and alcohol can, just as a reminder. guess I'm curious about if there's that conversation in some of these conferences because I think that's gonna be sort of this next piece where there's.
that can sell both, where there are stores that can sell both, what's the conversation about the combination?
Caitlyn LuBell (15:43)
So I think a lot of them are more suggesting that you use like â a booze free cocktail and top it then with their THC beverage or whatever instead of not in addition to, but then they were like, hey, if you want a margarita or espresso martini and you put a few drops in here. So, but I think their goal is to almost replace, right? Cause they're, yeah.
Kate Jerkens (15:55)
Okay.
Right.
Caitlyn LuBell (16:08)
I created
Erica Duecy (16:08)
Yeah.
Caitlyn LuBell (16:09)
a THC beverage. want people to drink this instead of booze. And I think also, you can have a few and you're not getting like over the edge to the point where you're like, okay, I need to stop. You just kind of keep going because some of them are really low dose. And so I actually was really appreciative of the low dose ones. Some of them were like 10 milligrams for a can.
Jessie Ott (16:34)
Ugh.
Caitlyn LuBell (16:34)
And that's just like too much. some of them, some of them were two milligrams of five milligrams. And so they just gave you this nice little buzz. And to me, it's actually smarter because then they're going to, you're going to order another one, right? It's the same with high proof booze compared to, you know, low alc booze. It's like, I drink a Campari and club soda just cause I can have a few more and rather than a, you know, straight tequila on the rocks or something. So I,
Kate Jerkens (16:36)
It's a lot.
Jessie Ott (16:37)
Yeah.
Erica Duecy (17:02)
Yeah,
Jessie Ott (17:03)
Yeah.
Erica Duecy (17:04)
it's interesting.
Caitlyn LuBell (17:04)
They were more leaning
into instead, I feel like. But then they were like, do whatever you want with it. As long as you're drinking it, we're happy, you know. Sorry, Erica, go ahead.
Erica Duecy (17:07)
Yeah, yeah.
Kate Jerkens (17:08)
Okay.
Jessie Ott (17:12)
Yeah.
Erica Duecy (17:13)
Yeah. no, I was just going to
add to that, that like, it's interesting because, â well, a couple of points there. â yeah, even so I'm in, in New Jersey and like at the bar, just a couple of blocks from my house. Now you can get nowadays, which is one of those brands. did an interview with them on, business of drinks. and that's essentially like a one-to-one replacement, but at the bar, you can literally add that to your margarita, right? So like in, out in the field.
Kate Jerkens (17:19)
Thank you.
Thank
Caitlyn LuBell (17:29)
Yeah.
Erica Duecy (17:40)
I don't think that that messaging about swapping them on and off is necessarily happening. At least it isn't at my corner bar. But interestingly, where we're seeing all the growth right now in THC beverages is for the 10 milligram products. So like the 10 milligram dosage products. some of that's RTDs, some of it's just like in the spirits looking format, the bigger 750 mls.
Kate Jerkens (17:59)
Thank
Erica Duecy (18:07)
But
I think that it's kind of, we talked about this recently on an episode and our take on it was that previously you had a lot of DTC products, right? So like people were trying them out, but now that they're in retail and on shelves, people are thinking more about like best bang for the buck. And that 10 milligram as a best bang for the buck compared to something that's a two milligram on the shelf next to it is where people are.
Caitlyn LuBell (18:27)
interesting.
for the same price.
Erica Duecy (18:35)
starting for the same price, right? That's where I think people
Caitlyn LuBell (18:35)
Interesting.
Erica Duecy (18:38)
are starting to like do the mental math and being like, well, maybe I'll sip a little bit less, or I could split this with a friend or what have you. Or if they're, you know, way more like, you know, like my husband definitely weighs however many 30 pounds more than me, he can have one of those, but like, I could not have one of those, right? I could not do a 10 milligram can maybe do like a three to five. That's probably my limit. So I think it really depends, like kind of, you know, are you
Caitlyn LuBell (18:52)
Yeah. Yeah.
Yeah.
Erica Duecy (19:02)
you know, a habitual THC user, how much do you weigh? You know, do you metabolize, how do you metabolize it in general? Like I think everyone probably metabolizes a little differently. So I think there's a lot at play there, but it's interesting to see that like bang for the buck start to show up in retail channels.
Kate Jerkens (19:05)
Great, just tolerance, yeah?
Caitlyn LuBell (19:18)
It does make sense, although I would think on-premise would maybe push the lower ones because they want to get additional sales, right? But then retail, it's like, that totally makes sense. So it's a very interesting category. I'm super excited about it. I think, I don't know, I think the toppers were super interesting because it's like, now you can give this to the bartender.
Jessie Ott (19:19)
Yeah.
Caitlyn LuBell (19:42)
they can make their own cocktail, whether it's a mocktail or a booze infused or whatever. But then just to have that as like an added addition, I thought was really, really an interesting kind of little plus there. â
Kate Jerkens (19:55)
I also find it fascinating some of the markets that will I mean, like I live in California, which is like fast and loose, but not with not with marijuana, like we may have been one of the first to make it legal, but it's served. It's sold separately, right in separate stores. There's no alcohol in those stores. It's only and I don't see it available or any kind of on premise situation. But yet, there's other markets that sort of shock me.
You know, I mean, where you can just it's like it can be sold anywhere and everywhere, you know, and it'll it's interesting to it's gonna it just is so it's fascinating to me to watch because I don't know how many places like I'm where I live. I don't think there's any bartenders that could put a THC topper on anything, you know.
Jessie Ott (20:23)
Yep.
Caitlyn LuBell (20:23)
Yeah.
Jessie Ott (20:30)
Hmm
Erica Duecy (20:35)
Yeah, mean, so, you know, the hemp derived THC is sold in 20 some states at like liquor stores and so forth. Even convenience stores, grocery, natural grocery in a lot of places. â But exactly, the farm bill loop, loophole, some people call it, but that's going to be like, that's actually in discussion right now. And probably the latest that we'll see, you know, a sort of judgment on that.
Kate Jerkens (20:45)
for while.
Caitlyn LuBell (20:46)
It's like a loophole or something, right?
Jessie Ott (20:50)
Yep.
Mm-hmm.
Erica Duecy (21:01)
will be October. like October is when the farm bill has to be updated or changed. but there, I keep on seeing updates that like that may come sooner. So it's hard to say exactly what's going to happen right now and what the final outcome would be. I think there's a lot of alcohol companies right now are in support, including the WSWA wanting to bring THC products.
particularly hemp derived THC products into the distribution space, especially because these RTDs and spirits sort of formats of like the 750MLs are taking, kind of creating new revenue opportunities for them that is especially in like a declining, where other categories might be declining. So I think it is a fantastic opportunity for
Caitlyn LuBell (21:44)
Yeah.
Erica Duecy (21:53)
distributors for other brands in the alcohol space to be, you know, kind of saying, how do we incorporate these products into our current product set or into our portfolios? Because that may be, you know, one of the fastest growing areas of, you know, of sales acceleration in like the foreseeable future.
Kate Jerkens (21:54)
Thank
Thank
Mmm.
Caitlyn LuBell (22:16)
A
lot of them are talking about growing their teams, getting into additional states. And then, you know, the exciting thing for me was like, there's so many unemployed. It blows me away that the statistic is so low on unemployment because I guess I'm in the space, right? So I talked to people bombarding all day, every day of looking for jobs. And so I feel like our industry, maybe unemployment rate might be quite a bit higher than the national standard, but
Erica Duecy (22:44)
Okay.
Caitlyn LuBell (22:44)
The
exciting thing is these beverages want people from the booze industry and or the people from the booze industry are like getting a little tired and jaded and angry. they're like, we ask all the time when we talk to them, when we talk to a candidate we're like, do you want wine, spirits, beer, alternate bev? How do you feel about hemp-derived beverages? Everyone's always like, yeah, I would totally do that. I'm excited about that.
intrigued by the category. So it's exciting for us because we see so many unemployed people out there and we want to help every single one of them and we can. But so like great if the industry is shifting and beverages are increasing, great. Hopefully they're going to need jobs. They're going to need to hire, right? And then these people from our business can kind of do the liaison. So it's exciting to see them grow because
Kate Jerkens (23:19)
May.
Yeah.
Caitlyn LuBell (23:37)
like great, more jobs for more people. That's what I see in my eyes, you know.
Jessie Ott (23:41)
Yeah,
but you're still, you have a product that's based on legislation that's going more conservative than, right? So like I was just reading here, like Texas Senate Bill 5 aiming to ban intoxicating hemp products, including THC drinks. So I think there are some states that are going against this. And if it doesn't get done federally very soon, you know, who knows what the future is? I don't think it'll ever go away. I don't want it.
Caitlyn LuBell (23:48)
without a doubt.
Kate Jerkens (23:51)
interesting point.
Caitlyn LuBell (24:00)
Yep, definitely.
Kate Jerkens (24:02)
It's good.
Jessie Ott (24:10)
to go away or anything like that, but we have to be mindful. Like I would think that starting a THC company would be a little frightening in that sense. mean, 20 States is good, but you know, we work in export and there's only a few countries that even are allowing it. There's, know, with Kate, with your brand, you know, I'm sure you guys were excited about the international opportunities to keep growing and growing a brand that kind of...
Kate Jerkens (24:19)
for sure.
Jessie Ott (24:37)
that doesn't exist in THC, you know, like in, so it's something to be mindful about.
Caitlyn LuBell (24:39)
Yeah, that's true.
Kate Jerkens (24:40)
right. But even as a smaller brand
trying to think about ways to expand internationally, one on any given day, the tariffs can go one way or another. It's been like that's just to be it's less of my focus is lessons there at this moment. To your point in Texas, I was there and yeah, I was I was in Texas in June for a week. I was all over Texas and every liquor store had just a big shelf of these home derived THC products. And they are doing so well with them.
Jessie Ott (24:49)
Here.
Yeah, and that's our reality now.
Caitlyn LuBell (25:06)
Wow.
Kate Jerkens (25:08)
and are just so nervous about what is going to happen in the state. they kept saying a decision was supposed to be made. It feels like maybe it's being delayed, being delayed, but they're selling the heck out of it. And they were just so nervous.
Caitlyn LuBell (25:19)
So there were
Erica Duecy (25:19)
Yeah.
Caitlyn LuBell (25:21)
a few people. I met this one woman who she was working for a brand, but she also said that she was on the Texas board of basically advocating for these beverages and stuff. And so I haven't gotten back with her yet just because that just happened. But I know that there's a big push in Texas.
for this category and for saving it and increasing it and growing it or protecting it however you want to look at it. yeah, mean compliance, mean we're all super used to compliance, right? And compliance issues and different laws in different states and counties and things. But I think they're even more challenged and it was kind of like...
Kate Jerkens (25:48)
Yeah. Yeah.
Jessie Ott (25:49)
Yep.
Erica Duecy (25:54)
Yum.
Caitlyn LuBell (26:02)
I would love to see it in black and white and see what each state is doing and where they can be sold. Because I was so intrigued by it. I was like, where are you selling? Like, this is great product. Who has it? Does the bartender have it? Does the indie retailer have it? Are you in chains? Yeah. Like, and then they're like, DTC, like order online. And I'm like, no, that's great. But like, I'm looking for you guys to grow the industry so that I can have jobs for people who are unemployed. So where where's it going? And
Erica Duecy (26:08)
Yeah.
Jessie Ott (26:09)
Yeah.
Erica Duecy (26:11)
Yeah.
Kate Jerkens (26:14)
Where do I get it?
Erica Duecy (26:17)
Yeah.
No.
Kate Jerkens (26:31)
Right.
Caitlyn LuBell (26:32)
A lot of them were like, not sure yet.
Jessie Ott (26:33)
You know.
Erica Duecy (26:34)
Yeah, well, I think it's
important to remember that there's two channels in the THC space as well, right? There's like the hemp drive THC, the Delta 9, which can be sold in many states and liquor stores and so forth. That's, you know, that has been the sort of like wild west, you know, where, you know, like we...
Jessie Ott (26:36)
something.
You don't ever know what you're going
Caitlyn LuBell (26:52)
Yeah.
Jessie Ott (26:53)
to get.
Erica Duecy (26:54)
Exactly. Well,
but we interviewed â Breeze. You probably have seen that brand, VREZ. You know, they did like $54 million in sales so far. It's like ridiculous how much they're bringing in. But so that's one side of the business where that's like the Wild West. Now let's talk about the other side of the business, which is dispensaries. And we just did an interview with a leader at MacHuber who is
Caitlyn LuBell (26:55)
yeah.
Breeze is great, yeah.
Erica Duecy (27:21)
with this brand, Air Loom, like A-Y-R-L-O-O-M. So that one is, that's really interesting to me because they're fully in like dispensaries only, dispensaries only, but in four years, they're doing 250,000 cases of their RTDs, right? Like full THC cannabis based RTDs. Their wholesale run rate is $50 million right now.
Caitlyn LuBell (27:24)
Yeah, â it's so good. The emeralds are really yummy.
Erica Duecy (27:49)
And that's in one state. That's in, that's in New York. They're the number one THC beverage brand cannabis brand in New York. but $50 million in one state. Yes. Like that. Now that is an interesting opportunity. And like they had previously, they knew how to work through distribution because they had a hard cider brand. They're like, it's called heirloom because it's actually like a huge hard cider orchard upstate New York. And now they do a full.
Kate Jerkens (28:07)
you
Erica Duecy (28:18)
seed to sip shipment, you know, whole operation at this one facility there. But yeah, I mean, that you can grow in four years to 250,000 cases is like astounding to me through dispensary routes.
Caitlyn LuBell (28:31)
So I've been, that was the first one I ever tried and it was the only one available at this dispensary. Like the dispensaries, some of them, at least in New York and Colorado, from what I've seen, they're not having 10 offerings or 20 offerings. They're having like one or two brands that they just kind of get behind. maybe that's because they hire good salespeople and the salespeople are going out and getting it or what, but they...
Erica Duecy (28:39)
interesting.
Kate Jerkens (28:43)
you
Erica Duecy (28:57)
Yeah, they do a lot of education
because it's even more regular. They can't even do any type of promotions. Social media is very restricted. All they can do is bud tender education. That's it. Buyer education, that's all. So they have invested a lot in that.
Jessie Ott (29:15)
you
Kate Jerkens (29:19)
That was my favorite.
Jessie Ott (29:20)
Did you coin that?
Erica Duecy (29:24)
No, no, no, no, no. That's been a, remember that way back from my Amsterdam trips of, of my early twenties.
Kate Jerkens (29:26)
Well, it's like an official thing. It's just so... Yeah, it's definitely a thing it's back.
Jessie Ott (29:30)
â goodness. have my head in the sand.
Clearly. Well, think also, you know, I'm one of these people and I don't know how common this is, but I can't do both. I'm not really a pot person. It doesn't do, it's not a great thing. I mean, I don't care about it. But my body can't handle both. So I'm surprised that they're wanting to...
Kate Jerkens (29:35)
It's pretty good. It's a pretty good one.
Jessie Ott (29:54)
It's interesting that bars, you know, the bar scenes are trying to do a floater. I know I had a gentleman on, â that, â we're in Minnesota. It's a really big deal and he's literally creating products just for Minnesota. Cause they're doing floaters on drinks. And I just can't, I just can't imagine, the combination of the two like that. It would just be just too much. Yeah.
Caitlyn LuBell (30:00)
Yeah.
Kate Jerkens (30:01)
Thank you.
Caitlyn LuBell (30:14)
I think if it's a low dose, it might be okay, but like a 10 milligram
Erica Duecy (30:14)
Yeah.
Caitlyn LuBell (30:19)
in a margarita or something like power, like it's Negroni or something, I'd be like, no, I'm good. Thank you.
Kate Jerkens (30:26)
Yeah, I can't do the
Erica Duecy (30:26)
Yeah.
Kate Jerkens (30:27)
old-fashioned old-fashioned in a dropper in a topper is not gonna be it.
Caitlyn LuBell (30:30)
doubt I have
one drink and I'm like I'm ready for bed munchies in bed
Kate Jerkens (30:34)
Maybe with an emerald
spritz or something. I mean, to me, mixing both is very juvenile. It feels like stuff I was doing in high school and college, right? Where you're like drinking beers and smoking weed. And I don't know, just, yeah, to me, doesn't feel like as an adult, we should be doing the both, but that's just me. And it just, yeah, just.
Erica Duecy (30:35)
Hahaha
Caitlyn LuBell (30:37)
You
Yeah.
think because it's
a new category and people are experimenting and you know, the bartenders, they still want to make, especially the real mixologist bartenders, they still want to their fancy cocktails, but they're like, okay, it's an additional offering or, you know, I don't know, they're probably charging an upcharge or something like that. And then the bar is making more money and people are experimenting. I'm with you though. I'd like, if I'm going to do a non-elk.
Jessie Ott (30:54)
Yeah.
Yeah.
Kate Jerkens (31:11)
Yeah.
Caitlyn LuBell (31:16)
sure give me a little floater and keep it simple.
Kate Jerkens (31:20)
As a liquor brand, we've been asked to participate in like, the dinners, you know, or like, you know, be the spirit sponsor for these dinners. That's actually been held for there's a lot of like, chefs and I'm sure everywhere that people are like cooking with marijuana, right? And so then as to be like the spirit sponsor, and we've been really pointed with saying no, because we don't want to be responsible for
Caitlyn LuBell (31:37)
Yeah.
Kate Jerkens (31:43)
whatever that that looks like when it's all mixed together and eating it is a very different experience than even drinking it and the the delay the delay time on how it affects people is interesting. â
Caitlyn LuBell (31:55)
It's
definitely an interesting category.
Jessie Ott (31:56)
Yeah.
I think it'd be interesting to have more of the aptinogens added to drinks versus the marijuana or whatever.
Kate Jerkens (32:05)
you
Erica Duecy (32:05)
Yeah, I
mean, I'm starting to see so much of that, you know, kind of like coconut water to hydrate vitamins to give this effect, you know, very much along the lines of Recess and kinuthorics. Right. And I think, I think more and more we'll start to see beverages wherever brands can, they will market by mood. Right. So like uplifting or
Kate Jerkens (32:11)
Magnesium for relaxation.
Erica Duecy (32:29)
energetic or calming, relaxing. I think in the non-alc space, we've seen that work really well. And I think for the THC brands, see more and more doing that. It's kind of sticky for how alcohol brands have to be very careful with how they use those terms, given the regulations in the space around how to market this category.
Jessie Ott (32:39)
Yeah, especially coffee.
Caitlyn LuBell (32:49)
Yeah.
Erica Duecy (32:54)
But I think where brands can talk about mood and feeling, that has proven to be a very successful strategy. So we'll see more moving towards that. â I mean, even look at like probiotics, the whole like probiotic promise of the Olipops and poppies and the kombucha is like all of those have really shown like â any sort of promise of like gut health.
â like that's appealing, like all of these â adaptogenic sort of messaging strategies are really resonating, especially with younger consumers.
Jessie Ott (33:31)
Yeah.
Kate Jerkens (33:32)
â I was trying to say it's funny because some of those adaptogens and some of those products, they don't have to even do that much, but the promise of it helps because quite frankly, like my two teenagers and my nine-year-old drink Poppy like crazy.
Caitlyn LuBell (33:34)
All right, you're back.
Jessie Ott (33:34)
I don't
either.
you
Kate Jerkens (33:48)
that doesn't do anything
for their stomachs. I'm pretty sure they're all sort of like normal, but they just like love the flavor of it and love that it feels fun and it's a soda and it's not a lot of sugar, right? So it's like the all of these kind of like adaptogenic drinks don't have to do that much but saying that they do like it gives people this feeling of like,
Caitlyn LuBell (34:05)
It's like the placebo effect, right? You're like,
Erica Duecy (34:07)
Right, like
Jessie Ott (34:07)
Yeah.
Erica Duecy (34:07)
this healthy aura.
Caitlyn LuBell (34:08)
this is going to make me chill. Great. And then you feel chill. I actually really, I like when things are labeled like that personally as a consumer, because I'm like, okay, this is how it's going to do. Maybe it's placebo. I don't know, but I'm like, I'll take it. I'm cool with placebo effect. Like, this is going to make me feel like, â great. Like I need that. I got to clean my house, you know.
Kate Jerkens (34:10)
Yeah. Done.
Jessie Ott (34:10)
Yeah.
Kate Jerkens (34:21)
Yeah.
Erica Duecy (34:25)
Yeah.
Jessie Ott (34:25)
Yes.
Kate Jerkens (34:29)
Yeah. It's so funny.
Erica Duecy (34:32)
Yeah, yeah.
Jessie Ott (34:33)
Well, has anybody heard anything about all these companies, or the fallout of RNDC in California and all these companies going to Reyes? What I heard at BC Brooklyn was Reyes is taking a lot smaller margin, because Kate, I remember, I don't know what episode we were doing, but you were kind of wondering what goes on in those conversations.
That's what I'm hearing is that they're taking lower margins than like a typical 30 or 35%.
Kate Jerkens (34:59)
Yeah.
So as somebody who is attributed by RNDC in California, I've been in the trenches these last few months. It's been very interesting. Thank you. A lot of shopping, a lot of great conversations, lots of tours, meeting really incredible. What I love about this is like small mid-tier distributors are getting to shine right now and it's great for them. And I have met some incredible people.
Jessie Ott (35:08)
â
Caitlyn LuBell (35:09)
So sorry for you. Yeah.
Jessie Ott (35:11)
Ugh.
Caitlyn LuBell (35:22)
Yes.
Jessie Ott (35:23)
Yep.
Kate Jerkens (35:27)
Still Reyes is taking a ton of nukes like to me so many suppliers my hunch right now They're not giving in on margin at this point. They were that this is a distributor. I don't think so anymore I mean possibly I could be wrong They don't have to and the reality is they need to beef up like they now have some really big brands and â Yeah, so I would guess
Jessie Ott (35:28)
Great.
Really?
Probably not anymore. Yeah.
Caitlyn LuBell (35:51)
Yeah.
Kate Jerkens (35:55)
I think this prior, before anyone knew anything was happening with RNDC, that was their selling point. But it is a distributor's game right now in California. And it's tough.
Jessie Ott (36:03)
Yeah.
Caitlyn LuBell (36:04)
It's been really interesting. I've
been following like who's, hiring, you know, and they're building up their teams and things like that. And I'm with you. It makes me really happy when I see some of the smaller distributors getting brands and I'm like, oh, good for them. Like, you know, they're stepping up, they're hiring, they're getting in the game and it's great. A lot of brands went to Breakthru a lot, a lot, a lot. think it was over 24 on the last list that I saw. So they got the
Kate Jerkens (36:10)
Yeah.
Yeah.
They've got big expansion plans. Yeah.
Caitlyn LuBell (36:31)
definitely a good handful went to Southern, but then there's all these other mid-tier distributors, which it does make me very happy because I want them to have more brands and I want them to be more successful and grow and I think it's better for that whole industry.
Kate Jerkens (36:41)
Yeah.
Jessie Ott (36:43)
Yep.
Kate Jerkens (36:45)
There's a lot of upside
for suppliers too. You'll be surprised we haven't made our announcement yet, but we're going with what I consider small to medium. And one of my biggest things is in these large distributors. And I would say that any of them, we have great partners across country, but there's a lot of layers. And so we're really excited to almost look at how we can relaunch and reinvigorate our brand here and be a part of it and not have any layers. I think there's...
Jessie Ott (37:11)
Mm-hmm.
Kate Jerkens (37:12)
There's so much plus side for a lot of us. I do also talk to a lot of smaller brands or startup brands that it's been really tough for. Those that were looking for distributors in California and this is gonna keep them from being able to expand in California for quite some time because when you look at what Ray is Southern and Breakthrough and then these other smaller distributors have had to bring on, there just won't be bandwidth to onboard many other suppliers at this point, probably for a good amount of time.
Jessie Ott (37:37)
Yeah.
my guess is Reyez got too big too fast. And I don't know if they have, yeah, I don't know if they have all the people they need.
Kate Jerkens (37:41)
That's how I feel.
Caitlyn LuBell (37:43)
Well, Reyes, I've always been told
Reyes was the number one distributor in the US for beer. I was always taught that because I didn't work the beer industry until I started recruiting. And then I started touching the beer industry. the number, so I started asking because I was new to it. And I'm like, who's the number one? Because in New York, we have Manhattan beer and Oak beverage and the smaller guys. But I'm like, hold on, my company does nationals.
Jessie Ott (37:51)
Yeah.
Caitlyn LuBell (38:11)
Who's the Southern in RNDC in the beer side? I was always told Breas.
Kate Jerkens (38:18)
They are for
beer, but it's a different cell to sell beer versus spirits. And it's a big learning curve. We work with some beer distributors and it's been a great experience, but it takes time. the time of cell, the actual selling in is a very different experience. â
Caitlyn LuBell (38:21)
100%.
Definitely.
Erica Duecy (38:35)
Yeah, I mean, you're-
Caitlyn LuBell (38:35)
But I think they're beefing up their sales team and doing trainings for spirits and things. Go ahead, Erica, you talk to them.
Kate Jerkens (38:38)
They've gotta be, yeah.
Erica Duecy (38:44)
Yeah, think
when you think about Gallo and a brand like High Noon, it makes perfect sense because where are those RTDs sold? Convenience channels, essentially places where you would sell beer. But yeah, think it'll be really interesting to watch Rhea's scale up more robustly into the spirit side. Will they be taking on many wine brands? I think it'll be interesting to see where they â end up putting their...
Kate Jerkens (38:51)
Sure.
Erica Duecy (39:10)
development dollars and like which brands they're able to bring on and how that business will perform in the coming year. But I agree that the opportunity for, I mean, there's just such a need for middle, small to middle sized distributors. â And, know, to your point, Kate, I think that's just such an opportunity to have a more robust partnership, right? Like,
Caitlyn LuBell (39:27)
Yes.
Jessie Ott (39:28)
Yeah.
Erica Duecy (39:36)
so that you're working not with just someone who is a logistics provider, but if you're a key brand like â Uncle Nearest and you're going to a smaller to mid-size distributor, like that could be a marquee brand for them and they want to provide a wonderful experience. So they're putting in probably, you know, some marketing power behind it and helping to create a robust
Kate Jerkens (40:01)
Right.
Erica Duecy (40:03)
strategy in market, whereas, you know, other types of partnerships are just that logistics provider. So it's a great opportunity for these smaller to midsize. â And I hope we see more of them. I keep on saying like launch a distribution company because there is a need. Yeah, I know.
Caitlyn LuBell (40:18)
Me too, I tell everybody. I'm like,
Jessie Ott (40:18)
Yep.
Caitlyn LuBell (40:21)
I need more distributors because we talk to these emerging brands every day and they, know, the big guys won't take them. There's a line out the door for the medium sized guys and the small guys aren't in enough accounts. And so, you know, it's like, but I keep telling people too, I'm like, you want to start something in industry, start a distributor, please.
Erica Duecy (40:26)
Yeah.
Kate Jerkens (40:35)
Yeah.
But the retailers,
the retail, the on and off premise have to agree to take on those as like, it's like just getting the paperwork filled out. Do know what I mean? Like that's like the biggest thing that just happened in California is like all these guys, they now have to work with everybody because there's not just three big guys anymore. There's a whole bunch. So I think that's going to be interesting.
Caitlyn LuBell (40:44)
They don't. Correct? Correct.
I'll tell you, â Boo's
Erica Duecy (41:00)
Yeah, and I bet you're not thrilled about that.
Jessie Ott (41:02)
Hahaha!
Erica Duecy (41:03)
Yeah.
Caitlyn LuBell (41:03)
business working on a little something. I think that there's a broken piece to the puzzle that I think that Boo's business is gonna be able to maybe help and navigate through because there is a big challenge to get the buyer to, so anyway, I'll just shut up. But that's really something that I think about a lot when I talk to brands.
Erica Duecy (41:06)
â
Kate Jerkens (41:06)
I like it. I like, I...
Did we just have somebody
else pause? Is Caitlyn paused? No.
Jessie Ott (41:28)
Yeah,
Caitlyn LuBell (41:28)
I
think I fell off. Did you guys lose me? Can you hear me?
Jessie Ott (41:30)
I feel like this has been happening quite a bit.
Kate Jerkens (41:33)
Yes,
Erica Duecy (41:33)
Now we
can, yeah. Maybe start that one again.
Kate Jerkens (41:34)
yeah.
Caitlyn LuBell (41:35)
Well, was just saying,
Booz Biz is definitely working on, I'm working on some ideas and some things that I think there's some broken pieces in the industry still that I think we may be able to solve. So it's something in the works. Yeah.
Kate Jerkens (41:48)
Great.
Jessie Ott (41:49)
Good.
I love it. Innovation. Come on the podcast. Let's talk about it.
Kate Jerkens (41:52)
like it.
Caitlyn LuBell (41:53)
Yes, exactly.
Evolution. said
that was my word for 2025 was evolution when we talked about that on our first podcast, I think. And definitely, Booz Viz is an evolution and the industry is evolving so rapidly that we all can't even keep up with it, right? But â
Jessie Ott (42:11)
Yeah. Well,
I mean, we were status quo until five years ago. Right? mean, RTDs kind of started changing the landscape quite a bit, probably what, 10 years ago. But, you know, yeah. I mean, we were, it was pretty, I wouldn't say boring, but it was pretty like steady, steady Eddie, you know? And like, to your point, Caitlyn, these steady Eddie companies aren't steady Eddie anymore.
Caitlyn LuBell (42:17)
Yeah.
DTC made a big change in the industry.
Kate Jerkens (42:26)
Yeah.
Jessie Ott (42:38)
You just saw they're down, they're down four or five, $6 million just this year.
Caitlyn LuBell (42:41)
You know, I'll tell you, when I would
talk, when I talked to candidates, I used to say, when they started using the word stability, like I need stability, I need long-term, I don't want to work with an emerging brand because they may run out of money and I may be unemployed again, and then my resume is all bouncy, stability, stability. And my line, literally, I like go to a distributor, Southern or RNDC or Breakthrough or a distributor, that's stable. And then what happens,
Jessie Ott (42:51)
Yep.
Kate Jerkens (43:04)
Yep.
Caitlyn LuBell (43:09)
year, was like Southern did layoffs multiple times, RNDC, all the drama with that. And I'm like, there's no stability in the industry anymore. When these giant distributors are blocking their doors, there is no stability in the industry. So like, just take your best shot. How's that? And at least, at least jumpy resumes aren't as bad as they used to be. Although I do still have clients that are like, well they've had four jobs and since 2020 and
Jessie Ott (43:17)
Yeah.
Kate Jerkens (43:22)
Yeah.
Take your best shot.
Caitlyn LuBell (43:37)
like, well, yeah, because comp, keep changing.
Kate Jerkens (43:39)
This is the business, yeah.
Jessie Ott (43:41)
Do we feel that
our industry is sort of a product of COVID, people being bored, probably drinking too much and creating brands â versus another industry?
Kate Jerkens (43:52)
Yeah, there was almost too much innovation
during COVID probably. Like there was a lot born out of COVID. There was too much drinking. There was more drinking than we'd ever seen and then a lot of innovation and everything's right sizing now.
Jessie Ott (43:56)
Yeah, too much pot, too much THC, too much thinking.
Yeah
Caitlyn LuBell (44:06)
I said this before on one of our talks, but I think what happened was people lost their jobs. And so they were sitting down and their entrepreneurial bones started getting poked because they're like, I need to make money. So I need to do something. No one's hiring. Let me now do my own thing. I've always wanted to be an entrepreneur. And I think like there has been always a surge of new brands coming out and, you know, new flavors of vodka and new whiskeys and things like that.
Jessie Ott (44:35)
Nothing like this
though.
Caitlyn LuBell (44:36)
But this is what happened. People had no choice. were like, I need to make money. I just lost my job. know, the restaurants are closed, whatever. Let me work on that project that I've been really wanting to do for so long. And definitely like, I think the entrepreneurial bonga pokes from COVID and it's a, I think it was a survival mode situation, but also like, well, I've always wanted to do my own thing. So what.
Jessie Ott (44:53)
Yeah.
Yeah, could be.
Kate Jerkens (44:56)
Mm.
Jessie Ott (45:02)
Yeah.
Caitlyn LuBell (45:02)
time is better than now
when I'm sitting at home getting unemployment and I can you now focus on this new project that I want to do.
Jessie Ott (45:12)
Do you feel like our industry has more innovation in it than others? I see quite a bit of innovation on the food side though.
Kate Jerkens (45:12)
Right.
Caitlyn LuBell (45:17)
Definitely.
Erica Duecy (45:21)
Yeah, I see a lot of innovation on the food side. but I think from my perspective, it's you know, I talked to a lot of brands across all areas of the drink space, like including, you know, energy drinks and like other types of NA drinks. And I would say I see the most innovation happening in NA and THC right now.
And so I think there's a lot of, like I was saying with around the functional drinks, there's just so much happening in that space. And I think it's going to continue. But I do think that we will, I think it's a bit cyclical, right? Like, so people were saying, you know, Gen Z is not drinking alcohol. then I think the innovation lens and the
investment lens went away from alcohol into these other spaces, right? But now actually we're starting to see a shift there. So I, don't know if you saw this recent, like the IWSR's latest report that just came out from their BevTrack survey. And it's showing like a huge shift among Gen Z's back towards drinking alcohol, which was in like, that was like a super eye opening thing to me. So.
Caitlyn LuBell (46:26)
Yes.
Erica Duecy (46:30)
Looking at this study, in March 2023, according to IWSR, only 46 % of US Gen Z respondents to this survey said that they'd had alcohol in the past six months. But by March 2025, that number had jumped to 70%, from 46 % to 70%. So in just one year, we're seeing a huge shift there. So overall, we're...
we're seeing that Gen Z is still drinking a little bit less than the overall adult average of around 78%. But that behavior is now starting to look a lot more like everyone else. So I do think that there's some sort of cyclical thing here, maybe Gen Z perhaps because of COVID or like the spending power issues that we've discussed, a variety of reasons, like mental health reasons, all these types of reasons that we could debate.
Jessie Ott (47:25)
Yeah,
Erica Duecy (47:25)
But I think it's all of the factors.
Jessie Ott (47:26)
they're living with mom and dad longer too.
Erica Duecy (47:28)
Yeah, I think it's all of the factors have made it so that Gen Z was slower to adopt alcohol, but it does appear if we're starting to look at some of this survey data, â it does appear that that behavior may be starting to get back to prior levels. So I think it's interesting and like something to keep tracking that this may not.
Jessie Ott (47:29)
Mom and dad are buying them booze.
Caitlyn LuBell (47:31)
Yeah.
Erica Duecy (47:51)
be the generation that goes away from alcohol, you know, like maybe we're kind of moderating in various ways across generational lines. But, you know, to the prior point, it does make me think like we're seeing all the innovation in THC and non-alc right now. But as behaviors shift and demand increases, maybe it's going to swing back.
Jessie Ott (48:10)
Yeah. And, you know, talking about, you know, all these small to mid-sized distributors, we're really coming full circle back to where we, back in the direction of where this all started when Diageo did this 25 years ago. And that's, that's what kind of keeps things exciting, at least in from my point of view. We don't really want just two or three distributors. You know, we want the more entrepreneurial business owners out there. So I think that's very exciting. And
Kate Jerkens (48:11)
Interesting.
Caitlyn LuBell (48:21)
Yeah.
Jessie Ott (48:35)
I don't know if you guys get emails from Park Street, but they had one that came out on June 10th, where they're basically saying that the spirits, feel like it's kind of stabilizing and that we're kind of getting to our new normal and that next year, it might get a little bit better. It says here, projects that core spirits will bottom out at
minus 4.56 by the end of 25, improving to minus 4.09 by Q2 of 26. So not great, but better, right? This is from SIP source, by the way.
Yeah, because they had obviously a lot more declines in 2020-2024.
Caitlyn LuBell (49:10)
Listen, people are always gonna drink.
People drink when they're happy, they drink when they're sad. People are always gonna drink and even if they swap out, they're gonna go back to it. it's, know, everything, I don't know. I've been in the industry more years than I wanna admit out loud and, you know, watching it go up and down and, you know, from beer, wine, spirits, and we didn't have all these additional categories for sure, but.
Kate Jerkens (49:14)
It's not going away, yeah.
Jessie Ott (49:16)
Yeah.
Caitlyn LuBell (49:36)
I don't know.
Jessie Ott (49:38)
Well, do you remember the days where it was all vodka?
Caitlyn LuBell (49:40)
yeah. The whole back bar was every flavor you could possibly imagine. And then we were, here we just launched four more and great, go sell these. The Van Gogh, I used to love the Van Gogh because they had like 97 flavors of Van Gogh and they were all so good and they were so much fun to sell. The beautiful bottles. I loved the Van Gogh. That was my favorite thing to sell.
Erica Duecy (49:41)
Yeah.
Kate Jerkens (49:41)
Hehehe
Jessie Ott (49:42)
Hey!
I really miss Fruity Pebbles vodka. I really do.
Erica Duecy (49:51)
Whipped cream, whipped cream, yeah.
Kate Jerkens (49:52)
God, I missed out on that one.
Jessie Ott (50:07)
Yeah,
Kate Jerkens (50:07)
That's funny.
Fruity Pebbles vodka I might get on board with though. Let's go, let's talk more about that.
Jessie Ott (50:08)
I think one other.
Caitlyn LuBell (50:11)
Hahaha!
Jessie Ott (50:12)
Rudy Pebbles vodka
was so good. I, I don't eat gluten where I try not to eat too much. And so, I mean, obviously it's just a sugar bomb, but when I was a kid, I ate that for three years straight for breakfast before school. I loved it. So when the vodka came out, was like, martini me up, please.
Kate Jerkens (50:15)
Wow.
Caitlyn LuBell (50:24)
You
Erica Duecy (50:24)
Ha ha ha.
Kate Jerkens (50:26)
I get it, I get it.
Caitlyn LuBell (50:29)
Ha
Kate Jerkens (50:29)
Yeah, childhood fate. Back to recruiting kids
though to drink alcohol. I'm seeing more, by the way, we talked about that like a few weeks, like I am seeing it more and more even to the point where my kids are getting offended by it now. How many like just normal everyday CPGs are now have alcohol on, know, know, Duncan, we were at a vacation up in the mountains and there was a Duncan doughnut type drink that has now that's alcohol. Like I was just shocked by that too.
Erica Duecy (50:45)
Yeah.
Jessie Ott (50:53)
Really? They
Erica Duecy (50:54)
Yeah.
Kate Jerkens (50:55)
it is.
Jessie Ott (50:55)
just-
Kate Jerkens (50:55)
It's prolific. And if you ask a child what the word spiked means, only those whose kids have parents in the booze industry know what that means to differentiate. That's all that's really differentiating them on these packages. It's crazy to me.
Jessie Ott (51:05)
Yep.
Caitlyn LuBell (51:07)
It's true.
Jessie Ott (51:08)
Yeah,
I went into Total Wine a while back and I found a whole section of Minute Maid. mean, Total Wine is safe for kids, you know, but yeah, it's crazy. Yes, I think it's a dangerous game they're playing.
Kate Jerkens (51:15)
Yeah, the minimaid is over the top for me. It's too, it's, that's a child's drink.
Caitlyn LuBell (51:20)
Yeah.
Kate Jerkens (51:23)
Sunny Delight
also like I mean if you think back to when we were younger the Sunny Delight commercial is the Sunny D and like all that now it's Sunny D and vodka. like kids don't need help with that they'll figure out how to combine those two at a high school party or college party they don't need our help. No.
Jessie Ott (51:25)
Mm-hmm.
Caitlyn LuBell (51:30)
Okay.
Wow.
Jessie Ott (51:36)
Yeah, we don't need our help.
Good point. Good point. Well, is there anything else that we haven't talked about? I know Erica's got to run here, but I thought this was really fun. I appreciate you ladies coming. I couldn't have predicted we would match. We all have black on. Which is pretty cool.
Kate Jerkens (51:53)
fun.
Erica Duecy (51:55)
Hahaha
Kate Jerkens (51:56)
I know. It's a
little, is that indicative? It's a doom and gloom of us. Maybe we shouldn't have brightened it up next time. Yeah, yeah.
Caitlyn LuBell (52:00)
All right, next
Jessie Ott (52:03)
Okay, solid colors, solid colors. Okay. Do we want to do this again? Like in, you want to do like this post timeframe? Meaning like, well.
Kate Jerkens (52:07)
I love it.
Caitlyn LuBell (52:15)
Maybe like a September, October or something like going into
Kate Jerkens (52:17)
Yeah.
Caitlyn LuBell (52:18)
OND and talking about the end of the year or something.
Kate Jerkens (52:20)
Yeah.
Jessie Ott (52:21)
Yeah,
I was thinking October, right?
Kate Jerkens (52:23)
I'll be able to give you guys some fresh updates from the California, the RNDC transition, because we will all be through it by then too. Hopefully that's the end of it.
Caitlyn LuBell (52:29)
Yeah
Jessie Ott (52:31)
â I hope...
Yeah, I hope you guys are running by then.
Caitlyn LuBell (52:33)
Well, congrats on finding
someone to go with because I know that's probably been so stressful. I feel so bad for all these. I couldn't believe like when I started seeing the list of all the companies, I'm like, wow, their portfolio is really big. That's a lot of brands scrambling. And it's just like even the small brands. Yeah, it's like there's so many scrambling right now. And it's like, oh gosh.
Kate Jerkens (52:36)
Thank you. Yeah, it's tough. Yeah.
Jessie Ott (52:36)
Yeah.
Erica Duecy (52:37)
Yeah, stressful.
Yeah.
Kate Jerkens (52:50)
They some big, big brands, yeah.
Erica Duecy (52:53)
Especially the small brands. So tough. Yeah.
Jessie Ott (53:00)
Why
Kate Jerkens (53:00)
Yeah.
Jessie Ott (53:01)
did they pull out? Like what was the major...
Kate Jerkens (53:02)
was all financial.
Caitlyn LuBell (53:02)
They were like, yeah,
Kate Jerkens (53:04)
It
Caitlyn LuBell (53:04)
they were at a loss.
Kate Jerkens (53:04)
was a big, yeah. It was a constant loss. â Constant loss, yeah. And so it does make you wonder. mean, the union, like there's a big union piece that plays into it. It's very expensive, but that's one piece. The union exists in a lot of places though. So it's like you, it could.
Jessie Ott (53:06)
Okay.
constant loss.
Ugh.
â
Caitlyn LuBell (53:22)
gonna say that's totally bullshit like
Kate Jerkens (53:24)
it comes
Caitlyn LuBell (53:24)
i
Kate Jerkens (53:25)
up a lot, right, but it exists, it does exist almost everywhere else. And that's not been caused to flow. And there's guys just bigger, but yeah, they were at a loss. And at a certain point when you're, you know, a market that, you know, represents fifth largest economy in the world is completely at a loss. It's a big loss to you know,
Jessie Ott (53:29)
Hahaha!
It's
a big loss. Yeah.
Caitlyn LuBell (53:43)
that when they
first went in and took over Young's that that was like, not a good like situation. And so, so that they already started like six feet underground. And then from what I heard, I'm not speaking of by that there was very poor upper management and, you know, just not doing the right thing. And, and I think they were, they were kind of being bullies with with brands and suppliers and the suppliers.
Jessie Ott (53:50)
They never should have bought Youngs.
Kate Jerkens (53:50)
Interesting.
Jessie Ott (54:11)
â
Caitlyn LuBell (54:11)
started
being like, you know what? No thanks. And this is just, you know, what I hear is feedback, but it, it makes me sad because I feel like I could have sent them 10 amazing candidates in two seconds that could have turned that entire business around in 18 months and, and saved it. So it makes me really sad. I do hear the union as an excuse a lot, but I worked at Southern in New York.
Jessie Ott (54:15)
Yeah.
Kate Jerkens (54:19)
I'm just like this.
Caitlyn LuBell (54:40)
All the reps were union and all the management was not. It was challenging, but we navigated it. Bye.
Kate Jerkens (54:43)
The Union exists everywhere.
Erica Duecy (54:45)
Yeah, I've got to hop off. Okay. Bye guys.
Kate Jerkens (54:48)
Okay, Erica. Bye, Erica. Yeah.
All right.
Jessie Ott (54:50)
Thanks for coming.
Kate Jerkens (54:50)
Thanks, y'all. Yeah, I do need to get, I need to get â booking and I'm sorry. Thank you for waiting on me today. I appreciate you.
Caitlyn LuBell (54:56)
Yeah, thanks, Jossie. I think we have to wait until it uploads or...
Jessie Ott (54:56)
Yeah, no problem.
Yeah, when I stopped the recording, so we'll just wave goodbye. Thank you ladies for coming. It was fun. â
Caitlyn LuBell (55:06)
Thanks for having us.
Kate Jerkens (55:06)
Thank you.
