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Bacardi: A Bat, with a Coat of Arms

Bacardi rum, no matter where it is made or where it is served, is always the same pure, high-quality rum with a distinctively fine, dry taste. Just say “Bacardi” and several images immediately spring to mind: Daiquiris, Rum & Cokes, tropical breezes, palm trees, and even fruit bats. Family-owned and operated since 1862, Bacardi Limited turned rum consumption from “Yo, ho, ho and a bottle of rum” to a sophisticated spirit sipped straight or on the rocks. “Shipping upwards of 25 million cases of rum blends annually to 180 countries worldwide”[1], Bacardi has set its eye on greater market domination with the introduction of many different Bacardi Breezers, Bacardi Limón, and other new products in the mid-1990s. The first company to produce smooth, light-colored rum in the mid-1800s, Don Facundo Bacardi turned his blending process that he called the “marriage of rums,” into a reported billion-dollar empire that has a rich history of 150 years.

Bacardi’s history begins with the emigration of Facundo Bacardi y Maso from Spain in 1830. “Born in Sitges, Catalonia, Bacardi arrived in the Caribbean port city of Santiago de Cuba, then a Spanish colony populated by many fellow Catalans. There the 14-year-old Bacardi began importing and selling wine.”[2] While working for an Englishman named John Nunes, who owned a local distillery, Facundo started tinkering with ways to upgrade the quality of “aguardiente or “fire water”. Also known as rumbullion, which was later shortened to just “rum”, Facundo hoped to “civilize” the dark liquor from its early incarnations as a coarse, harsh liquid swilled by buccaneers.”[3] As rum production had changed little in the last 200 or so years, Facundo decided it was time to elevate the spirit into something smoother and more refined.

“In 1843 Facundo’s rum experiments had paid off and he offered samples of his newfangled light rum to relatives and friends. Facundo’s secret formula enabled him to ferment, distill, and blend from molasses, rum one could drink straight, almost like wine, without mixers or additives.”2 Since molasses was a byproduct of processing sugarcane, which was Cuba’s largest export, there were ample quantities around the island. “On February 4, 1862, Facundo, his brother Jose, and a French wine merchant joined forces to buy Nunes’ tin-roofed distillery for $3,500”2, which had all the necessities: a cast-iron still, fermenting tanks, and aging barrels for creating and selling a Bacardi brand of rum. With buying the old distillery as is, Facundo also received the added bonus of a colony of fruit bats that later came to represent the Bacardi name.

The Bacardi enterprise is and almost always has been a family affair. Facundo’s three sons Emilio, Facundo Jr., and Jose joined the company when they came of age and learned their father’s secret formula for making what was fast becoming the Caribbean’s finest rum. “Emilio, the oldest, worked in the office; Facundo Jr. worked in the distillery; and Jose, the youngest, eventually worked in selling and promoting his father’s products.”2 Facundo Jr., in honor of his father and to celebrate the new family business, planted a coconut palm tree just outside the distillery. In the ensuing years, as the business thrived, Junior’s coconut palm did, too, and became an enduring symbol of the Bacardi family and its spirits operation but it was a little bat that would become the most recognizable rum label to-date:

“As the 1880s dawned, Don Facundo retired and turned Bacardi over to Emilio, Facundo Jr., Jose, and Enrique, who was his son-in-law. The company’s early distribution problems had been solved with a suggestion from Dona Amalia, to provide Bacardi products with a distinctive, easily recognized label. Many of Santiago’s residents couldn’t read, Dona Amalia recommended using a symbol to represent Bacardi. The Bacardi logo was then born, sporting a most unlikely mascot, the fruit bat.”1

Before the turn of the 19th century, just as Bacardi was starting to flourish, Cuba was engaged in battle to gain its independence from Spain. “Emilio, fighting for his country, was banished and Enrique went with him into exile.”2Any history buff will tell you that the United States joined the fray after a mysterious explosion on the U.S. battleship Maine sparked the Spanish-American War in 1898. After defeating the Spanish, the U.S. and Spain signed the Treaty of Paris, which in 1901 led to Cuba becoming an independent republic, and in turn allowed Emilio to return home to family and business. “Emilio was elected first, mayor of Santiago and then in 1906 Emilio was elected to the Cuban Senate. Sadly the next year Jose, the youngest Bacardi son who had represented the company’s interests in Havana, died.”3 The family mourned his loss, but the business continued to prosper and in “1910 Emilio returned to his father’s homeland to begin Bacardi’s first international venture of a new bottling facility in Barcelona, Spain.”3 As Bacardi set out to conquer the world with its premium rum, a little roadblock called Prohibition stood in its way. This was only a little roadblock because while the Bacardi’s could not sell their spirits to the U.S., nothing stopped Americans from coming to Cuba for liquor. Havana soon became known as “the unofficial U.S. saloon” and Bacardi rum was one of its biggest attractions. “Bacardi’s international sales were also strong in a world whose population topped 1.8 billion by 1922. This same year, both the family and the business suffered the loss of patriarch Emilio, followed two years later by Facundo Jr. Enrique, though not a family member by blood took the reins of the burgeoning company and served as its president.”2

The dawn of the 1930s brought further international expansion for Bacardi as its bottling operation in Spain was a huge success. Realizing Bacardi rum could be distilled and sold from any facility with the appropriate equipment, Enrique began to open what soon became a network of distribution points. “First was the establishment of a new subsidiary in Mexico in 1931, which was nearly bankrupt through a severe recession. Enrique’s son-in-law, Jose Bosch, intervened and kept the operation afloat until the economy improved and the small company turned profitable.”2 When Prohibition was repealed in 1933 Bacardi was ready and willing to fill the gap. Enrique promptly sent his son-in-law Jose to New York City to pave the way for Bacardi’s distribution in the United States. Back in Cuba the political climate was once again boiling as Fulgencio Batista y Zaldivar, the country’s army chief of staff, became Cuba’s de facto ruler after a military coup. The coup back home didn’t causing them to blink an eye as “Bacardi entered the U.S. marketplace in a bang selling over 80,000 cases in 1934. To save the company the United States’ expensive import duty tax of nearly $1 per bottle, Jose Bosch decided to open another Bacardi facility in Old San Juan, Puerto Rico.”1 Under American control since the Treaty of Paris, Puerto Rico was and still is considered U.S. soil and its exports are duty free.

The 1940s brought several milestones for Bacardi, both in expansion and brand recognition. Much of the company’s U.S. business had begun through word-of-mouth praise from visitors to the Caribbean, especially those flying Pan American Airways, which used Bacardi in some of its ads, “Fly Pan Am to Cuba and you can be bathing in Bacardi in hours.”3 To capitalize on Bacardi’s growing reputation and enhance its brand at the same time, Enrique and Jose initiated advertising on Bacardi’s excellent qualities as a mixer. Two of the more popular variations were “the Daiquiri, named after a Cuban village where an American mining engineer mixed Bacardi, crushed ice, and lime juice in 1896; and the Cuba Libre or Rum & Coke, created by an American army lieutenant in honor of Cuba’s new independence.”3 The same year “Rum & Coca-Cola” sailed up the charts, Bacardi Imports was established in New York City to coordinate the increasing demand for Bacardi. By the end of the decade, dark clouds loomed on the horizon for Bacardi because with the reintroduction of whiskey in the United States, “2rum sales plummeted 47 percent in a one-year period from 1947-1948.” With the death of Enrique Schueg in 1950, Jose Bosch assumed the role of CEO. In 1953 when drinkers had become concerned over the caloric content of liquor, Bosch introduced a new advertising tactic comparing the “calories of a Daiquiri with those in a glass of milk. This successful spin was soon followed by ad campaigns directed to blacks and Hispanics, and in 1956 the company broke barriers by using a woman in its ads, who advised homemakers to serve a Daiquiri with the evening meal.”1 But as the 1950s came to an end, Cuba was once again seized by revolution this time to unseat Batista. Regarded by many as a puppet of the United States, whose continued interference in Cuban affairs spawned guerrilla uprisings, Batista ruled until 1959 when rebels led by Fidel Castro and his brother Che Guevara overthrew his dictatorship. Jose Bosch, who supported Castro, was shocked when “in 1960 the new Castro government seized Bacardi’s assets, valued at $76 million.”1 Luckily for Bacardi, it not only had its Mexican, Puerto Rican, New York, and recently established Brazilian operations to fall back on, but its registered trademark. Bacardi’s shareholders, all descendants of Facundo, reconstituted the company in 1960 as Bacardi & Company Limited, headquartered in Nassau, the Bahamas. Another company, Bacardi International Limited, was also formed and headquartered in Bermuda. “In 1962 the company sold 10 percent of its shares in an initial public offering (IPO).”3

Trying to stave off competitors with Bacardi’s reputation as a mixer, the company launched a new advertising campaign once again expounding rum’s versatility:

“”Enjoyable always and all ways” was supposed to be taken literally, to use Bacardi’s light-colored rum as a substitute for anything, even vodka in heavyweight drinks like highballs. The formula worked and Bacardi’s sales grew by 10 percent annually throughout the 1960s, when the company finally broke into the top ten of distilled spirits brands. In 1964 Bacardi sold over one million cases of rum and 4 years later this figure had doubled.”2

The advertising campaigns were a great hit and by the end of 1970, “2.6 million cases of Bacardi were sold.”1 Aiming to further dominate the U.S. spirits market, Bacardi aggressively campaigned its rum as the mixer of choice, featured in “joint promotions with Coca-Cola, Canada Dry Ginger Ale, Dr. Pepper, 7Up, Pepsi, Perrier, and Schweppes’ tonic water.”1 In a well-played game of one-upmanship, Bacardi won the battle against Smirnoff vodka as the nation’s biggest-selling distilled spirit. “In 1976 after a dispute with the Bacardi family, Jose Bosch resigned as president of the company. The following year Bosch and a group of his supporters sold their company stock to an outsider, Hiram Walker.”2 Unfortunately, this break with family tradition was the first in a series of squabbles that rocked the Bacardi Empire over the next decade-and-a-half.

“In 1986, three years after Bacardi Capital was created to manage and invest company funds, a group of inexperienced brokers lost $50 million speculating in the bond market. Regrouping, Bacardi Chairman Alfred O’Hara and President Manuel Luis Del Valle, both nonfamily members brought in to run the company in the 1970s, commenced a controversial stock buyback, which divided the company and inspired a storm of controversy. Many of the 500 family shareholders cried foul, several Bacardi family members were ousted, and O’Hara and Del Valle succeeded. Spending more than $241 million, they bought back or converted shares from Bacardi’s IPO in 1962 as well as those sold to Hiram Walker in 1977.”2

When the 1990s began Bacardi was once again a private company. Having weathered the Bacardi Capital scandal and increasing family discord, the company was faced by falling market share and sales. In an effort to jazz up its image Bacardi Frozen Tropical Fruit Mixers and Bacardi Breezers were introduced to wide acclaim. Two years later came Rum & Coke in a can and a majority interest in Martini & Rossi for $1.4 billion. As a result of the purchase, “Bacardi became the fifth largest wine-and-spirits company in the world. Before the Martini & Rossi acquisition, Bacardi was bringing in close to $500 million annually”3, yet was nowhere near complacent. Its next new product launch, Bacardi Limón, was aimed at younger drinkers of flavored liquors like Absolut’s Citron and Stoli’s Limonaya. “Introduced in 1995 with an $11 million advertising campaign, Bacardi Limón took off and was considered one of the hottest high-proof new brands of the year.”1 By the mid-1990s Bacardi had “bottling facilities located in Australia, Austria, France, Germany, New Zealand, Switzerland, the United Kingdom, and the United States, while its spirits were still manufactured in the Bahamas, Mexico, Puerto Rico, Spain, Brazil, Canada, Martinique, Panama, and Trinidad.”1 The company’s brands had grown to accommodate virtually all tastes.

“First and foremost was Bacardi’s four premium rum blends: Bacardi Light, the original, comparative to gin and vodka as a mixer; Bacardi Dark (full-bodied, its amber color achieved by blackening the inside of wooden aging barrels) and Bacardi Black (charcoal-filtered just once before elongated aging; later renamed Bacardi Select), which competed with whiskey and bourbon; Bacardi Añejo, a golden rum blend named for the Castillian word meaning “aged” that appealed to upscale brown spirits-drinkers; and Bacardi Reserve, a twice-filtered blend for brandy and cognac drinkers.”3

By 1996 all of Bacardi’s products were given a more hip look with updated labels and bottle caps. As the company headed into the 21st century it was once again a family-run empire, with Facundo’s heirs calling the shots. Manuel Jorge Cutillas and his brother Eduardo occupy the top posts, while the company has created “alliances with partners in Hong Kong, Japan, Malaysia, the Philippines, Russia, Taiwan, and Thailand to introduce its products.”1 Today, Bacardi can be found all over the world with the exception for Cuba, because of the government seizing the company’s holdings. With the company’s forward thinking on establishing international production facilities and with the help of acquiring a multitude of worldwide spirits companies, Bacardi now is the largest, privately owned spirits company in the world. Setting their sights high for the future, the name Bacardi now conjures up far more than refined dry rum. Bacardi is not just a premium spirit but an institution that is here to stay, and with continued ad campaigns like Bacardi & Cola they really do “get the job done.”

 

 

Bibliography

“BACARDI: 150 YEARS AT-A-GLANCE 1862-2012.” Fact Sheet. Web. 03 June 2012. <http://www.bacardilimited.com/PressRelease/FactSheet&gt;.

“Bacardi.” Wikipedia. Wikimedia Foundation, 29 May 2012. Web. 03 June 2012. <http://en.wikipedia.org/wiki/Bacardi&gt;.

“In the Beautiful Port City of Santiago De Cuba, a Small Family Enterprise Purchases a Distillery and Revolutionizes Rum-making on February 4, 1862.” The Early Years. Web. 03 June 2012. <http://www.bacardilimited.com/our-heritage/the-early-years&gt;.


[1] Bacardi Fact Sheet

[2] Bacardi The Early Years

[3] Bacardi Wiki

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