For many, Bacardi rum is synonymous with the Caribbean, with its roots in Cuba and later Puerto Rico. But with growing demand for spirits around the globe, Bacardi Limited now produces, markets and distributes a variety of internationally recognised spirits.
As Joaquin Bacardi, president and CEO of Puerto Rico-based Bacardi Corporation, emphasises, the Bacardi Corporation was established in 1936 in San Juan, and later became a subsidiary of Bacardi Limited.
Bacardi Limited maintains its corporate headquarters in Bermuda and is the largest premium rum brand and the third largest spirit company in the world, behind Diageo and Pernod.
Since 1993, when Bacardi Limited acquired Martini & Rossi, the company has been striving to become the world’s premium spirits company. In 1998, it purchased Bewar’s scotch and Bombay Sapphire gin; in 2002, the Cazadores Blue Agave tequila brand; in 2004, the French-made Grey Goose vodka; and, in 2006, New Zealand’s 42 Below vodka brand. Today Bacardi Limited continues its global quest with a particular focus on markets in the Asia-Pacific region.
In total, the company has 36 dedicated spirits-manufacturing sites around the world involved in bottling, distilling, manufacturing and R&D. In Scotland, for example, it operates five malt distilleries. Martini products are manufactured in Italy, and bottled at plants in Germany, Spain, Canada, the US, Chile, Uruguay and Brazil. France is home to three plants, including Benedictine and Grey Goose. The company also has a bottling plant in China.
Specific to its rum business, Bacardi operates two primary distilleries in Puerto Rico and Mexico, and a small operation in India. The Indian operation in Karnataka produces 1% of Bacardi’s rum for emerging markets in Asia.
Its Puerto Rico site, on 513,947 square metres in Cataño, is the biggest rum distillery in the world. According to Mr Bacardi, the plant supplies 83% of Bacardi rum consumed worldwide, 60% of which is destined for the US market.
“The other 40% goes all over the world, particularly to Europe, Central and South America and Asia,” says Mr Bacardi.
In total, this adds up to some 17 million cases, or 100 million bottles, of Puerto Rican rum a year, an amount that offers Puerto Rico a tax rebate of about $250m a year. “As a result, Bacardi is responsible for 3% of the [Puerto Rican] government’s annual income,” says Maggie Matias, a spokesperson for Bacardi.
Executives see the BRIC countries of Brazil, Russia, India and China offering the greatest growth potential for Bacardi. “Russia is very strong right now and China is doing very well. India is fantastic,” says Mr Bacardi.
But he sees mature markets also offering growth opportunities. Here, he says, Puerto Rico offers an efficient location because of the island’s market position in the Caribbean, and Bacardi’s production and marketing facilities there.
The company continues to invest in its Puerto Rican operations. To help cut energy costs, which are very high in Puerto Rico, the company has introduced two wind turbines. There are also plans to add 18,500 square metres to its current 56,000 square metres of warehouse space where the rum is aged.
The company has also cut logistics costs by opening a $14m molasses terminal in Cataño. According to Mr Bacardi, his company imports more than 14 million gallons of molasses, rum’s main ingredient, a year.
From Cataño, the distilled and aged beverage is shipped to Bacardi’s operation in Jacksonville, Florida, where it is bottled and distributed throughout the Americas. Another tanker, dubbed Joe Spirit, hauls the product to Bacardi’s bottling operation in Buxtehude, Germany, where it is distributed throughout Europe.
The Caribbean remains, however, the company’s largest market for its rum products, a fact that is largely down to the 2.6 million tourists who visit the islands every year.