BARONS AND BLENDERS

ON THE EVE of the passage of the Excise Act there were 111 licensed stills in Scotland, forty-two of them in the Highlands. Some of them – or at any rate their names, for the buildings are long gone – are still with us: Glenturret, Glen Garioch, Linkwood, Strathisla, Brackla, Clynelish, Tobermory, Bowmore, Lagavulin, plus a handful of others. Only three years later there were 263, of which 107 were in the Highlands; in the same period Britain’s official spirits production nearly doubled to just over 18 million proof gallons or, in modern parlance, 80 million litres of pure alcohol.

Tommy Dewar, a brilliant extrovert who made White Label the best-selling blend in the United States and was ennobled as the first Baron Dewar.

For the existing legal distilleries, especially those in the Highlands, the lifting of trading restrictions that was part of the Excise Act was transformational: some that had previously limped along, such as Teaninich, now blossomed; others that had been forced to close, such as Blair Athol, now reopened. Many, if not most, of the ‘new’ distilleries weren’t so new, however. To more enterprising smugglers, going legal was both attractive and easy. All you had to do was hand in your old pot and get a new one with a capacity of 40 gallons or more. True, you had to pay both a licence fee and duty; but all the risk, interruption and inconvenience of the past were over. Some of the best-known distilleries of today have shady pasts: Cardhu was notorious as the home of Helen Cumming, who, when gaugers approached, would invite them in for tea and then make an excuse to go outside and wave a red flag to warn her husband, John, of their presence. Edradour, Scotland’s smallest distillery, was founded legally in 1825 by a cooperative of local farmers to supply their own needs; but mysteriously, they seem to have been already experienced stillmen!

John Dewar, born to a poor crofting family in 1806, worked hard at school, showed promise, and got a job with a wine merchant in Perth at the age of twenty. Twenty years later he set up on his own and was among the first to bottle a proprietary blend – the legendary White Label – and to engage sales representatives in London.

Not everything was rosy for the Highlanders, however. Convictions for illegal distilling fell from 4,500 in 1823 to a mere 873 in 1825; but every household where distilling was given up lost an income estimated at 10s a week. There was real want, which occasionally flared into violence. Arson attacks on the new distilleries were frequent, and George Smith, founder of The Glenlivet, who had been an illegal distiller before the Act and was the descendant of generations of smugglers, never travelled without a brace of loaded pistols. (He drew them only once, though, and then only to fire a warning shot, which had the desired effect.)

The Glenlivet Distillery, founded by George Smith.

Poacher turned gamekeeper: George Smith of Glenlivet was one of the first of the ‘smugglers’ to go legitimate after the 1823 Excise Act.

But although whisky was now respectable, elbowing its way into the mainstream drinks trade was not easy. As newcomers to an established market where the working classes already had their beer and gin and the aspiring and upper classes their port and brandy, the whisky distillers had to find wholesalers, retailers and a buying public for what was, to most, a novelty. They were helped by the fact that top-quality Scotch had already penetrated the uppermost strata of society – was it, one wonders, a well-placed Scottish peer who introduced the Prince Regent to The Glenlivet? – and soon after the Excise Act we find Scotch whisky on sale as a luxury item in the West End of London. In Sketches By Boz (1836) Charles Dickens, who used liquor of all sorts as a recurring motif throughout his works, had two City clerks on a gala night out in the Strand treating themselves to ‘goes of the best Scotch ... and the very mildest cigars’. After that he fell silent on the subject of whisky, although his own cellar, according to his probate inventory, was well stocked with it. The best malts might have earned their place in the decanters of the wealthy, but in the mass market Scotch was slow to take off.

The first hurdle the distillers faced in bringing Scotch to market was the variability not only in its quality but in its very nature. Highland whisky was reputedly all malt; but while there may only rarely have been surpluses of other grains to pad out the wash, there are records of other fermentables, especially potatoes, being used when over-abundant. The malting process itself was often crude: sacks of barley were soaked in bog water, allowed to sprout and then parched as quickly as possible over wood or peat fires. There are also records of small-scale distillers continuing to use botanicals more generally associated with gin – especially herbs and wild flowers, but on occasion juniper berries and orange peel. Hurried distillation meant that some Highland products were high in heavy alcohols, especially fusel oil. And maturation was haphazard and little understood. The breadth of the spectrum, ranging from young, pale and aromatic to dark, heavy and fusel-rich, must have been quite enough to leave unfamiliar consumers utterly bemused.

The second hurdle was adulteration. Throughout history foodstuffs have been padded out with cheap stretchers, both legal and illegal. Victorian consumers seem to have taken it for granted that whatever they bought might contain more or less anything from the innocuous to the lethal; and whisky was no exception. Like so many commodities, it was shipped in casks, which made it vulnerable to tampering. The agent might make three barrels out of two; the retailer might buy two of those barrels and make another three. An astonishing array of colouring and flavouring agents was conscripted to disguise the fact that the whisky had been so watered down. Cheap sherry, prune wine, green tea, glycerine, angelica root, cayenne pepper, various fruit concentrates – these were harmless. But methylated spirits, turpentine, even sulphuric acid, also common additives, were anything but. Governments from the mid-nineteenth century on legislated repeatedly against adulteration; but with whisky agents and retailers (rather than distillers, who were in the main not involved) they ran into a brick wall. There was no definition of whisky, the trade argued; traditionally it might carry high levels of fusel oil as well as various additives and adulterants, or on the other hand it might not. Either way, there was no case to answer. A determined attempt to expose adulteration as a scandal came in 1872 when the North British Daily Mail hired a chemist to analyse more than thirty samples from Glasgow pubs. Many were entirely synthetic and contained no whisky whatever; of only a single sample could the chemist report ‘a good whisky, free from adulteration save with water’. The investigation provoked much lively debate but, in the end, no action.

A whisky dynasty – six generations of the Grant family, owners of the Glenfarclas distillery in Speyside since 1865 (left to right: John, George, George, George, John, and George).

The third hurdle was commercial. The Lowlands possessed some large concerns making mostly grain spirit, much of it destined to become gin. Highland distilleries, though, were mainly small affairs whose operators had little or no experience of trading (legally) beyond their own backyards and no understanding of the markets now opening up to them. Nor can they have been technically well-equipped to meet the new challenges. Small manufacturers in any field rarely have the resources to analyse and improve their processes and to achieve the consistency that markets require. Highland distillers by and large worked with the ingredients nature provided and the processes their parents passed down to them. They were not even in full control of the quality and consistency of their product when it left the distillery, still less as it made its way down the supply chain.

Workers at Glenfarclas, c. 1895.

The answer to many of these problems lay in an Irish invention, the continuous or column still, which could produce a more or less endless stream of nearly pure alcohol and was to lead to the development of blended scotch. First patented in 1822 by Sir Anthony Perrier of the Spring Lane Distillery in Cork, it wasn’t an immediate success but attracted the attention of Robert Stein of Kilbagie, a big Lowland distillery near Kincardine. Stein, an in-law of the powerful Haig dynasty, was already selling spirit on the English market. In 1826 he demonstrated an improved but still imperfect version of Perrier’s still; watching was an Irish excise officer, Aeneas Coffey, who spotted how the device could be improved yet further and in 1830 took out his own patent and started manufacturing Coffey stills in Dublin. The Coffey still, highly efficient both mechanically and in terms of malt tax, was immediately adopted by distillers in both England and the Lowlands but was met with disdain by the Highland malt distillers as producing a spirit with no character. Yet it became, in the 1850s, the essential piece of technology in Scotch whisky’s battle to reach an English and indeed an international mass market.

John Alexander Dewar, son of John Dewar, who ran the family business, eventually becoming first Baron Forteviot.

One of Scotch whisky’s early problems, as we have seen, was that it ran such a broad gamut of expressions: even the same distillery’s output could vary from year to year. Merchants such as Arthur Bell of Perth and Andrew Usher of Edinburgh therefore started ‘vatting’ or blending different vintages from the distilleries they represented to produce at least some degree of uniformity and, they hoped, an identity that the consumer could recognise. The availability of neutral spirit from the new continuous stills enabled the blenders to drown out or at least tone down jarring and overdominant notes – especially peatiness – to create a smoother drink that was both more consistent and more palatable to the Sassenach. In theory the admixture of 50 per cent or more of the much cheaper grain spirit would also bring the price of whisky within the reach of the common man; but this didn’t happen until 1860, when the Spirit Act allowed maturing stocks to be held duty-free in bond. The cash-flow advantage of being allowed to defer payment of duty until the matured spirit went on sale was a game-changer for the big whisky merchants: it allowed them the leeway to mature their stocks properly and also led to a major innovation: bottling.

Bottling is always held out as the big blenders’ answer to the problem of adulteration, and there is some truth in that. But it did more than give the blender control over quality: it created an affordable small package where previously the consumer had had to buy from the barrel; and it allowed the creation of an eye-catching bottle label and a memorable brand name that the consumer could rely on. There’s some argument as to which of the whisky merchants of the 1860s was the first to bottle and brand their own blends. Was it Usher’s, Dewar’s, John Walker, George Ballantine, Bell’s or John Haig? They all claim the honour; they certainly all reaped the rewards.

For this was the beginning of a forty-year golden age, due not only to the efforts of the industry itself but also to external factors. Scotland’s railways were connected to the English network in 1849; the lines that were built throughout the country in the following forty years brought coal and barley to many a distillery siding, and carried casks of finished whisky away to the blenders. The Strathspey Railway, for example, opened in 1863 and linked distilleries at Forres, Cromdale, Advie, Ballindalloch, Knockando, Dailuaine, Aberlour and Craigellachie to the Keith–Dufftown line, which had opened the year before. The trading climate was improved still further in 1880 when Gladstone’s Liberal government finally repealed the malt tax. The loss of revenue to the Exchequer was clawed back through higher duty; but again, cash-flow was greatly improved by deferral of payment.

Despite all these advances, the English remained stubbornly wedded to brandy until the advent of phylloxera. This tiny aphid arrived in France from the United States in 1862 and fastened itself on to the country’s vine roots, into which it injected lethal toxins. The unwelcome migrant spread rapidly and within a very few years had destroyed 40 to 50 per cent of France’s vineyards. The cause of the blight was identified by 1868, and in the early 1870s the French began ripping out their old vines and replanting with American rootstock, which had a degree of immunity. But the vineyards of Cognac had been devastated and would take more than a decade to recover. By the mid-1870s brandy was in short supply. Scotch wasn’t.

Aberlour station on the Strathspey Railway, now the Speyside Way. The spreading of the rail network in the 1860s was crucial to the whisky industry’s national and then global success in the 1870s and ’80s.

In 1897 Dewar’s built a distillery of its own, Aberfeldy in Perthshire, which still flourishes today.

This opportunity coincided with the emergence of a new generation among the whisky dynasties, a generation whose businesses were on secure foundations and who were eager to find new markets. In the 1880s these confident young plutocrats established offices in London and set about making their presence felt. Thomas (always known as ‘Tommy’, even after he was ennobled) Dewar, younger son of John Dewar of Perth, was sent to London in 1885 aged only twenty-three. Refused permission to exhibit his White Label blend at a brewers’ show at the Agricultural Hall, he fetched his bagpipes and paraded up and down outside playing as loudly as he could and refusing to stop, however earnestly he was begged to. It didn’t get him into the show, but it did get him noticed; shortly afterwards Dewar’s became sole supplier of Scotch to the high-society caterer and wholesaler Spiers & Pond. The company was able to lease a distillery – Tulliemet in Perthshire – in 1890 and built one of its own – Aberfeldy, also in Perthshire – in 1896.

Then there was the dapper James Buchanan, who had been McKinlay’s London agent before setting up on his own in 1884. He had the sense to choose an accountant who was also chairman of United Music Halls, all of whose bars were soon stocking his blend. He also made friends with the manager of a prestigious hotel, whom he cultivated for several months before dropping into the conversation that he was a whisky merchant. That account, too, was soon his. His final coup was to secure the account of the House of Commons. Buchanan’s whisky was therefore given a sombre new bottle-dressing with the appropriate gravitas, from which it soon earned the nickname Black & White. (The image of terriers came later.)

Dewar and Buchanan were only two of the whisky paladins who cut a faintly and pleasingly exotic dash in London’s social and business networks in the 1880s and ’90s. Alexander Walker, son of the original Johnnie Walker (who, in contrast to the debonair image created by commercial artist Tom Brown in 1908, was rather a cautious and reserved man) was another; Peter Mackie of White Horse fame was a fourth. But capturing London was only the first step: the city was also a gateway to the world. Not only was London the capital of that huge portion of the globe that was then coloured red to represent the British Empire on the maps; it was also the world’s greatest entrepôt of finance and commerce and therefore a node from which whisky’s reputation could spread. Success was not inevitable, however, and whisky barons had to work hard to cultivate world markets – in 1892 Tommy Dewar began a world tour that netted agents for White Label in twenty-six countries but took two whole years – but still, the world was ready for them. The Empire, as a sales territory, could be more or less taken for granted; Europe was still short of brandy; and the aspiring high society of North America regarded its native whiskies as too rustic for its taste and took eagerly to Scotch.

A White Label bottle, dating from c. 1910.

James Buchanan set up in business in London in 1884. He once booked a table for twelve at a hotel that he knew didn’t stock his brand. When the waiter arrived, they all asked for Buchanan’s. On hearing there wasn’t any, they got up and marched out.

In 1886 William Grant, manager of Dufftown’s Mortlach distillery, bought a complete set of second-hand equipment from Cardhu, which was re-equipping, to found Glenfiddich, which he ran with his wife, Elizabeth, and their three sons.

This expansion in sales was not only great; it was rapid. There was a risk of running out of the malt whiskies the blenders needed, and their response was to secure their supplies by launching what amounted to a reverse takeover of the malt distillers. In 1884 Leith-based blender William Sanderson bought one of Scotland’s oldest distilleries, Glen Garioch, which had been established in 1797 and had remained in the hands of the founding family until that time. He re-equipped it with the two biggest pot stills in Scotland, and from then on much of its output went into VAT 69. In 1891 Mackie’s, in partnership with the Speyside whisky merchants Alexander Edward, built Craigellachie. In 1892 the Glasgow merchant Robertson & Baxter acquired one of its key suppliers, Glenglassaugh. In 1893 Johnnie Walker bought the famous Cardhu distillery. And so it went on.

Workers Glenfiddich in the late 1890s.

William Grant built the Glenfiddich distillery virtually single-handed.

The blenders were now undisputed masters of the industry – indeed, the sale of single malt almost died out. They didn’t just buy distilleries: they built them, too. In 1885–7 the journalist Alfred Barnard toured all 129 working Scottish distilleries; had he made the same tour in 1900 he would have had to visit thirty more, including such well-known names as Craigellachie (1891), Balvenie (1893), Glen Moray (1897) and Knockando (1899). Between 1886 and 1897 the small Speyside town of Dufftown acquired four of its seven distilleries. But that accounts only for brand-new distilleries; in the same period dozens of existing ones were expanded or rebuilt. The extent of the investment in production can be gauged by the fact that the architect Charles Doig of Elgin (designer of the ‘pagoda’ maltings so emblematic of the Scottish distillery) was alone responsible for building or rebuilding a total of fifty-six distilleries.

By 1890 Grant was doing well enough to build a second distillery, Balvenie, just down the road; today William Grant & Sons is the biggest family-owned company in the business and is a world-class competitor.

Suspicions that this breakneck growth might be no more than a bubble seemed confirmed in 1898 with the collapse of the business owned by the brothers Robert and Walter Pattison, whisky merchants of Leith. Latecomers to the boom, the Pattisons fell into the hiatus between the satiation of actual demand and the moment that the banks realise the game is up. The two brothers were therefore able to borrow freely – squandering much of their capital, said disapproving contemporaries, on luxury and display – but could capture market share only by selling an inferior product cheaply and squeezing as much credit out of their suppliers as they could. When the banks finally called their loans in, a lot of malt distilleries were left holding bad debts and were forced to follow the brothers – both of whom were jailed for offences including paying dividends out of capital – into receivership. Between 1900 and 1908 sixty distilleries had to close, including some, such as Caperdonich, that had only just opened. Worse, the industry was holding more than 13 million proof gallons in bond, enough to satisfy a third of Britain’s annual thirst for spirits.

But it wasn’t a bubble. The supply side, especially the independent malt distillers, may have been fragmented and chaotic, as evidenced by the lawsuit taken out in 1880 by Glenlivet against the host of competitors who were using its name. (It ended in a compromise: as Glenlivet was the only distillery in the eponymous parish it remained entitled to call itself The Glenlivet, but its neighbours were still allowed to use the name in composites such as Dufftown-Glenlivet.) But the industry as a whole was solid: demand was there and the trade was profitable. In the preceding years a new breed of multiple conglomerates had been forming, and they were well-capitalised and businesslike, unlike the Pattisons. The independent sector had been due a shake-out, but the multiples were strong enough to survive.

The first and biggest of them was the Distillers Company Ltd, or DCL as it became known. It originated in 1856 when the six largest grain distillers formed a trade association – frankly, a cartel – to fix prices and carve up the market between them. The best-known, although not the largest, of DCL’s founding companies was one of the Haig family businesses. In 1877 DCL was incorporated as a limited company, and it was floated on the London Stock Exchange in 1886. In response, the other grain distillers formed the rival North British Distillery Company, but DCL was always the stronger and, on the collapse of Pattison brothers, was able to buy their Leith warehouses, newly built at a cost of £60,000, for just £25,000. It had already built a malt distillery of its own, Knockdhu in Aberdeenshire, in 1894. During the contraction that followed the Pattison collapse DCL used its capital to diversify into grain distilling in England and Ireland and into the production of yeast and industrial alcohol.

The collapse of Pattison brothers, the First World War, Prohibition in the United States and finally the Depression resulted in the closure of all thirty distilleries in Campbeltown, including Benmore (shown here). Only three – Springbank, Caol Ila and Glengyle – ever reopened.

The other big blenders also spent the first years of the twentieth century consolidating their positions, mainly through financial restructuring and the development of marketing and advertising campaigns. How far they had succeeded was about to be put to the sternest possible test.