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The COVID-19 pandemic has been one of the most devastating in modern times. It forced people all over the globe to quarantine for months, leaving some with little to no contact with loved ones and causing many to struggle with their mental health on their own.
Consuming alcoholic beverages became some people's go-to self-medication tactic to make the grueling times a bit easier to swallow. As terrible as it may sound, many liquor manufacturers benefitted from this rise in consumption, which led to one of the highest peaks in the industry's sales.
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According to a study in 2020 by the National Institute of Health (NIH), heavy alcohol consumption in the U.S. rose mainly due to stress, with 29% of people reporting an increase in drinking during the COVID-19 pandemic.
Related: Popular vodka brand sold after spirits sales slump
However, everything that goes up has to come down at some point, and the spirits and wine markets are experiencing this harsh fall firsthand. Now that people aren't forced to stay isolated, liquor sales have been dropping, causing multiple manufacturers and distributors to suffer the consequences.
The spirits and wine industry suffers sales declines and a slowdown in consumption
The spirits and wine industry has struggled post-pandemic for the last few years, as consumers have begun to cut back their liquor spending, especially those with a pricier price tag due to inflation and an uncertain economy.
In its latest reported earnings, Brown-Forman reported a 5% sales decline for the first six months of the fiscal year compared to the year prior, with diluted earnings per share down 3% to $0.96.
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Brown-Forman is one of the largest family-owned companies in the spirits and wine business in the U.S. It has served customers for 155 years and owns multiple premium liquor brands, including Jack Daniel's, Woodford Reserve, Herradura, el Jimador, and others.
However, Brown-Forman decided it wouldn't let this slump continue affecting its business and developed a restructuring plan to return to profitable numbers.
Brown-Forman makes a major restructuring announcement for its business
On Tuesday, Brown-Forman Corporation (BFA) announced various strategic initiatives through the development of a restructuring plan in hopes of accelerating growth and getting the company's finances back on track.
“Today’s announcement will ensure we have the structure and teams in place to continue on this path, while also making investments that we believe will facilitate growth for generations to come,” said Brown-Forman CEO Lawson Whiting.