Bacardi

Bacardi Limited
Private company
Founded Santiago de Cuba, Cuba (4 February 1862)
Founder Don Facundo Bacardí Massó
Headquarters Hamilton, Bermuda[1]
Key people
 Facundo L. Bacardi, Chairman;
Michael J. Dolan, CEO[2]
Products Bacardi rum, Grey Goose vodka, Dewar's Blended Scotch whisky, Bombay Sapphire gin, Martini & Rossi vermouth and Asti, Eristoff vodka, Cazadores blue agave tequila, Angel's Envy Bourbon
Revenue Increase US$ 5 billion (est. 2012)[3]
Website bacardilimited.com

Bacardi Limited (English: /bəˈkɑːrdi/; Catalan: [bəkəɾˈði]; Spanish: [bakarˈði]) is the largest privately held, family-owned spirits company in the world. Originally known for its eponymous Bacardi white rum, it now has a portfolio of more than 200 brands and labels.[4] Founded in 1862, and family-owned for seven generations, Bacardi employs 6,000 people, manufactures at 27 facilities in 16 markets on four continents, with sales in more than 150 countries. Bacardi Limited refers to the Bacardi group of companies, including Bacardi International Limited.[5] The company sells in excess of 200 million bottles per year.[6] The company's sales in 2007 were US$5.5 billion, up from $4.9 billion in 2006.

Bacardi Limited is headquartered in Hamilton, Bermuda, and has a 16-member board of directors led by the original founder's great-great grandson, Facundo L. Bacardí. Along with other leading alcohol producers, Bacardi is part of a producers' commitments to reducing harmful drinking.[5]

History

The Bacardi Building in Havana, Cuba

Early history

Facundo Bacardí Massó, a Spanish wine merchant, was born in Sitges, Catalonia, Spain, in 1814, and emigrated to Cuba in 1830. During this period, rum was cheaply made and not considered a refined drink, and rarely sold in upmarket taverns. Facundo began attempting to "tame" rum by isolating a proprietary strain of yeast still used in Bacardi production. This yeast gives Bacardi rum its flavour profile. After experimenting with several techniques he hit upon filtering the rum through charcoal, which removed impurities. In addition to this, Facundo aged the rum in white oak barrels, which had the effect of mellowing the drink. The final product was the first clear, or "white" rum in the world.

Moving from the experimental stage to a more commercial endeavour, he and his brother José set up a Santiago de Cuba distillery they bought in 1862, which housed a still made of copper and cast iron. In the rafters of this building lived fruit bats – the inspiration for the Bacardi bat logo.[7]

The 1880s and 90s were turbulent times for Cuba and the company. Emilio Bacardi, Don Facundo's eldest son, was repeatedly imprisoned and was exiled from Cuba for having fought in the rebel army against Spain in the Cuban War of Independence.[8]

Emilio's brothers, Facundo and José, and his brother-in-law Henri (Don Enrique) Schueg, remained in Cuba with the difficult task of sustaining the company during a period of war. The women in the family were exiled in Kingston, Jamaica. After the Cuban War of Independence and the US occupation of Cuba, "The Original Cuba Libre" and the Daiquiri were both created, using Bacardi rum.[9] In 1899 US General Leonard Wood appointed Emilio Bacardi Mayor of Santiago de Cuba.

In 1912, Emilio Bacardi travelled to Egypt, where he purchased a mummy (still on display) for the future Emilio Bacardi Moreau Municipal Museum in Santiago de Cuba.[10] In Santiago, his brother Facundo M. Bacardí continued to manage the company along with Schueg, who began the company's international expansion by opening bottling plants in Barcelona (1910) and New York City (1915).[11] The New York plant was soon shut down due to Prohibition, yet during this time Cuba became a hotspot for US tourists.

In 1922 Emilio opened a new distillery in Santiago. In 1930 Schueg opened the Art Deco Bacardi building in Havana and the third generation of the Bacardí family entered the business. Facundito Bacardí was known to have invited Americans (still subject to Prohibition) to "Come to Cuba and bathe in Bacardi rum."[10] A new product was introduced: Hatuey beer.

The "Cathedral of Rum" at the Bacardi distillery in Cataño, Puerto Rico, near San Juan

Bacardi's transition into an international brand was due mostly to Schueg's "business genius"; Schueg "branded Cuba as the home of rum, and Bacardi as the king of rums" and expanded overseas, first to Mexico (1931), then to Puerto Rico (1936), under the brand name Ron Bacardi. (Ron is the Spanish word for rum). Post-Prohibition production in Puerto Rico enabled rum to be sold tariff-free in the US.[12] He then expanded to the United States (1944).[13]

During World War II, the company was led by Schueg's son-in-law, José "Pepin" Bosch. Pepin founded Bacardi Imports in New York City, and became Cuba's Minister of the Treasury in 1949.

Cuban Revolution

Portuondo and other Bacardí family members initially supported the Cuban revolutionaries, including Fidel Castro and the broader M-26-7 movement: Bosch personally donated tens of thousands of dollars to the movement, and acted as an intermediary between the revolutionaries and the CIA to assuage the latter's concerns.[12] Family members, employees, and facilities were put to use by the movement and the company supported the revolution publicly with advertisements and parties.[12] But their support turned to opposition as the pro-Soviet Che Guevara wing of the movement began to dominate and as Castro turned against their interests.

The Bacardí family (and hence the company) maintained a fierce opposition to Fidel Castro's revolution in Cuba in the 1960s. In his book, Bacardi, The Hidden War (ISBN 978-0745318738), Hernando Calvo Ospina outlines the political element to the family's money. Ospina describes how the Bacardi family and the company left Cuba after the Castro regime confiscated the company’s Cuban assets on 15 October 1960, particularly nationalizing and banning all private property on the island as well as all bank accounts. However, due to concerns over the previous Cuban leader, Fulgencio Batista, the company had started foreign branches a few years before the revolution; the company moved the ownership of its trademarks, assets and proprietary formulas out of the country to the Bahamas prior to the revolution and also built plants in Puerto Rico and Mexico after Prohibition to save import taxes on rum being imported to the U.S. This helped the company survive after the communist government confiscated all Bacardí assets in the country without any compensation.[14]

Ospina also explains the close ties Bacardí family members had to the U.S. political elite as well as to organizations of state such as the CIA. The family funded various Cuban exile organizations, such as CANF.

More recently, Bacardi lawyers were influential in the drafting of the 1996 Helms-Burton Act, which sought to extend the scope of the United States embargo against Cuba.[15] In 1999, Otto Reich, a lobbyist in Washington on behalf of Bacardi, drafted section 211 of the Omnibus Consolidated and Emergency Appropriations Act, FY1999 (Pub.L. 105–277), a bill that became known as the Bacardi Act. Section 211 denied trademark protection to products of Cuban businesses expropriated after the Cuban revolution, a provision keenly sought by Bacardi. The act was aimed primarily at the Havana Club brand in the U.S. The brand was created by the José Arechabala Company and confiscated without compensation in the Cuban revolution. The Havana Club trademark had been registered by the Cuban government in the United States without permission of the rightful owners.[16] The new law invalidated the trademark registration. Section 211 has been challenged unsuccessfully by the Cuban government and the European Union in U.S. courts. However, the act has been ruled illegal by the WTO (August 2001). The U.S. Congress has yet to re-examine the matter.

Bacardi and Cuba today

Bacardi drinks are not found in Cuba today. The main brand of rum in Cuba is Havana Club, produced by a company that was confiscated and nationalized by the government during the revolution. Bacardi later bought the brand from the original owners, the Arechabala family. The Cuban government, in partnership with the French company Pernod Ricard, sells its Havana Club products internationally, except for the United States and its territories. Bacardi created Havana Club rum based on the original recipe from the Arechabala family, manufactures it in Puerto Rico, and sells it in Florida. Bacardi continues to fight in the courts, attempting to legalize their own Havana Club trademark outside the United States.[17] Drinks now made in the former Cuban Bacardi distillery are sold in Cuba under the name Caney.

Despite having no production facilities in Cuba today, Bacardi in the UK has recently decided to re-emphasize its Cuban heritage, primarily for commercial reasons. Facing increased competition in the rum market from the now international brand Havana Club, the company concluded that it was important for sales to associate its rum with Cuba. TV advertisements with slogans of 'Welcome to the Latin Quarter' are but one example of this. In 1998, under the distinctive bat logo, the phrase "company founded in Santiago de Cuba in 1862" was added.

Bacardi has faced criticism and legal problems for supposedly attempting to encourage consumers to believe that they were purchasing rum made in Cuba, rather than just marking its heritage. Bacardi adverts in Spain, since 1966, had described a popular combination of rum and Coke as "rum and coke". However, after 1998, it began to describe the drink as Cuba Libre – literally translated as "Free Cuba", which is the original name of the drink and what it is mostly called in Latin America. In this instance, Bacardi faced a legal ruling from the Spanish Association of Advertising Users which forced the company to stop the advert. They concluded that it could "mislead the viewer as to the true nature of the product", as the advert contained so much Caribbean imagery, one might conclude it came from Cuba.[18]

The Bacardi Building in Havana is regarded as one of the finest Art Deco buildings in Latin America.[19]

2012 OSHA investigation

In August 2012, a temporary worker at the company's Jacksonville, Florida, bottling subsidiary, Bacardi Bottling, was fatally injured while servicing a palletizer machine. After conducting an investigation, the U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) determined that Bacardi was in violation of several safety regulations, including two willful violations. Bacardi Bottling was fined $192,000 by OSHA.[20][21]

Brands

Bacardi Limited has made numerous acquisitions to diversify away from the eponymous Bacardi rum brand. In 1993, Bacardi merged with Martini & Rossi, the Italian producer of Martini vermouth and sparkling wines, creating the Bacardi-Martini group.

In 1998, the company acquired Dewar's scotch, including Royal Brackla and Bombay Sapphire gin from Diageo for $2 billion. Bacardi acquired the Cazadores tequila brand in 2002 and in 2004 purchased Grey Goose, a French made vodka, from Sidney Frank for $2 billion. In 2006 Bacardi Limited purchased New Zealand vodka brand 42 Below.

Other associated brands include the US version of Havana Club, Drambuie Scotch whisky liqueur, DiSaronno Amaretto, Eristoff vodka, B&B and Bénédictine liqueurs.

Awards

In its 150-year history, Bacardi rum has more than 550 awards for quality and product profile, making it the world’s most awarded rum. Emblems of gold medals and the Spanish Coat of Arms awarded during the formative years of the business appear on the bottle.

Bacardi rums have been entered for a number of international spirit ratings awards. Several Bacardi spirits have performed notably well. Bacardi 8, for example, received two gold medals and a silver medal from the San Francisco World Spirits Competition between 2008 and 2010. In addition, it received the International High Quality Trophy at Monde Selection's World Quality Selections in 2010, and a Grand Gold Medal in 2011. Bacardi Gold, Bacardi 8, and Bacardi Reserva Limitada were also awarded International High Quality Trophy awards at the 2010 Monde Selection’s World Quality Selections.[22] However, it should be noted that these awards are non-competitive, and only products that pay to enter are assessed.

Proof66, a website that aggregates professional ratings from the Beverage Testing Institute and other professional rating organizations, places Bacardi Reserva Limitada, Bacardi 1873 Solera, and Bacardi 8 in the First Tier or Top 10th percentile of all rated spirits.[23][24][25]

Hemingway connection

Ernest Hemingway lived in Cuba from 1939 until shortly after the Cuban Revolution. He lived at Finca Vigía, in the small town of San Francisco de Paula, located very close to Bacardi’s Modelo Brewery for Hatuey Beer in Cotorro, Havana.

In 1954, Compañía Ron Bacardi S.A. threw Hemingway a party when he was awarded the Nobel Prize in Literature – soon after the publication of his novel The Old Man and the Sea (1952) – in which he honored the company by mentioning its Hatuey beer. Hemingway also mentioned Bacardi and Hatuey in his novels To Have and Have Not (1937) and For Whom the Bell Tolls (1940). Guillermo Cabrera Infante wrote an account of the festivities for the periodical Ciclón, titled "El Viejo y la marca" ("The Old Man and the Brand"). In his account he described how "on one side there was a wooden stage with two streamers – Hatuey beer and Bacardi rum – on each end and a Cuban flag in the middle. Next to the stage was a bar, at which people crowded, ordering daiquiris and beer, all free.”[26] A sign at the event read "Bacardi rum welcomes the author of The Old Man and the Sea".

In his article "The Old Man and the Daiquiri", Wayne Curtis writes about how Hemingway’s "home bar also held a bottle of Bacardi rum". Hemingway wrote in Islands in the Stream "...this frozen daiquirí, so well beaten as it is, looks like the sea where the wave falls away from the bow of a ship when she is doing thirty knots."[27]

United States headquarters

The Bacardi building on Biscayne Boulevard, Miami, the US headquarters of Bacardi

In 1964 Bacardi opened its new US headquarters in Miami, Florida. Exiled Cuban architect Enrique Gutierrez created a building that was hurricane-proof, using a system of steel cables and pulleys which allow the building to move slightly in the event of a strong shock. The steel cables are anchored into the bedrock and extend through marble-covered shafts up to the top floor, where they are led over large pulleys. Outside, on both sides of the eight-story building, more than 28,000 tiles painted and fired by Brazilian artist Francisco Brennard, depicting abstract blue flowers, were placed on the walls according to the artist's exact specifications.

In 1972, the Company commissioned the square building in the plaza. Architect Ignacio Carrera-Justiz used cantilevered construction, a style invented by Frank Lloyd Wright. Wright observed how well trees with taproots withstood hurricane-force winds. The building, raised 47 feet off the ground around a central core, features four massive walls, made of sections of inch-thick hammered glass mural tapestries, designed and manufactured in France. The design came from a painting by German artist Johannes M. Dietz.

In 2006, Bacardi USA leased a 15-story headquarters complex in Coral Gables, Florida. Bacardi had employees in seven buildings across Miami-Dade County at the time.[28]

Bacardi vacated its former headquarters buildings on Biscayne Boulevard in Midtown Miami. The building currently serves as the headquarters of the National YoungArts Foundation. Miami citizens began a campaign to label the buildings as "historic". University of Miami professor of architecture Allan Schulman said "Miami's brand is its identity as a tropical city. The Bacardi buildings are exactly the sort that resonate with our consciousness of what Miami is about".[29] In 2007 Chad Oppenheim, the head of Oppenheim Architecture + Design, described the Bacardi buildings as "elegant, with a Modernist [look combined with] a local flavour."[30]

The current American headquarters is at 2701 LeJeune Road in Coral Gables.[31] The 300 employees occupy 230,000 square feet (21,000 m2) of leased office space.[32]

Mexico City buildings

Bacardi had architects Ludwig Mies Van Der Rohe and Felix Candela design office buildings and a bottling plant for them in Mexico City during the 1950s. The building complex was added to the tentative list of UNESCO's World Heritage Site list on 20 November 2001.[33]

References

  1. ↑ Fact Sheet
  2. ↑ http://finance.yahoo.com/news/bacardi-limited-names-chief-executive-150100946.html
  3. ↑ Emily Glazer; Joann S. Lublin (9 March 2012). "Bacardi Turns to P&G Ex-Executive". The Wall Street Journal. Retrieved 15 August 2013. Bacardi has an estimated $5 billion in annual revenue and competes with global giants Diageo PLC and Pernod Ricard SA, as well as smaller companies like Beam Inc. and Brown-Forman Corp., all publicly traded.
  4. ↑ Andrew Ross Sorkin (21 June 2004). "Bacardi to Buy Grey Goose, Stirring More Talk of I.P.O.". New York Times.
  5. ↑ "Bacardi Limited". http://www.BacardiLimited.com. Retrieved 23 April 2012. External link in |work= (help)
  6. ↑ "Bacardi & Company Limited Company Profile". Yahoo!.
  7. ↑ Our heritage: the early years from the company's corporate website
  8. ↑ Gjelten, Tom (2008). Bacardi and the Long Fight for Cuba. New York: Viking. ISBN 9780670019786.
  9. ↑ "Daiquiri".
  10. 1 2 Charles A. Coulombe. Rum. Citadel Press.
  11. ↑ Bacardi Limited: Our Heritage – Havana and Beyond. Retrieved 10 May 2011.
  12. 1 2 3 Rum and Revolution an August 2008 review of Bacardi and the Long Fight for Cuba (ISBN 978-0-670-01978-6) from The Washington Post
  13. ↑ "Bacardi Limited: Our Heritage – Prohibition and Innovation". Bacardi. Retrieved 10 May 2011.
  14. ↑ Hernando Calvo Ospina (2002). Bacardi: The Hidden War. Pluto Press.
  15. ↑ The Helms-Burton Act from thinkquest.org
  16. ↑ Ann Louise Bardach: Cuba Confidential. Penguin books 2002. p.131
  17. ↑ Caribbean Business: Bacardi wins round in Havana Club fight Retrieved 30 May 2011.
  18. ↑ Ospina p. 79
  19. ↑ "Edificio Bacardí (Ciudad de la Habana)", EcuRed (Cuban state-filtered wiki)
  20. ↑ "US Labor Department's OSHA cites Jacksonville, Fla.-based Bacardi Bottling following death of temporary worker on 1st day" (Press release). OSHA. February 11, 2013. Retrieved May 3, 2014.
  21. ↑ Boukley, Ben (February 12, 2013). "Bacardi Bottling Corporation faces $192,000 fine after worker ‘crushed to death’". BeverageDaily.com. Retrieved May 3, 2014.
  22. ↑ "The International High Quality Trophy - 2010, Spirits & Liqueurs Selection". Monde Selection. Retrieved 23 April 2012.
  23. ↑ Proof66 Summary Page for Bacardi Reserva Limitada
  24. ↑ Proof66 Summary Page for Bacardi 1873 Ron Solera
  25. ↑ Proof66 Summary Page for Bacardi Ron Reserva 8-Year
  26. ↑ Cabrera Infante, Guillermo (1956). "El viejo y la marca". Ciclón.
  27. ↑ Curtis, Wayne (October 2005). "The Old Man and the Daiquiri". The Atlantic.
  28. ↑ "Bacardi USA to take over BK's planned Coral Gables headquarters." South Florida Business Journal. Tuesday 8 May 2007. Retrieved on 2 October 2009.
  29. ↑ "Miami weighs preserving iconic Bacardi buildings." Associated Press at New York Daily News. Tuesday 7 April 2009. Retrieved 3 October 2009.
  30. ↑ Rousseau, Bryant. "In Conversation: Chad Oppenheim." Businessweek. 27 June 2007. 2. Retrieved on 3 October 2009.
  31. ↑ "Bacardi USA Announces New Headquarters in South Florida." Retrieved 18 October 2010.
  32. ↑ "Bacardi USA Marks Opening of State-of-the Art South Florida Headquarters." Retrieved 18 October 2010.
  33. ↑ "Ludwig Mies Van Der Rohe and Felix Candela's Industrial Buildings – UNESCO World Heritage Centre". Retrieved 18 April 2010.

External links

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