US Liquor Industry Faces Crisis as Alcohol Consumption Declines

Rising Bankruptcy Cases Among Distilleries

The US liquor industry is navigating through a challenging period marked by declining alcohol consumption and rising bankruptcy cases among distilleries. In 2025 alone, several prominent distilleries have filed for bankruptcy, including A.M. Scott Distillery, Luca Mariano Distillery, and House Spirits Distillery. The trend reflects a broader shift in consumer behavior and economic pressures affecting the industry.

Declining Alcohol Consumption

A recent Gallup survey highlighted a significant decline in alcohol consumption among US adults. The survey revealed that only 54% of US adults consume alcohol, representing the lowest percentage recorded in the survey's history. Furthermore, among those who still drink, the average consumption has dropped to 2.8 glasses per week, the lowest level since 1996. This downward trend in alcohol consumption is a key factor contributing to the financial struggles of distilleries and other industry players.

Economic and Lifestyle Factors

The decline in alcohol consumption is attributed to various factors, including changing lifestyles with a greater emphasis on health and wellness, economic pressures that have reduced consumer spending power, and trade tensions that have impacted exports. These factors have collectively created a challenging environment for the US liquor industry, leading to the recent wave of bankruptcies.

Industry Outlook

The crisis facing the US liquor industry is likely to continue unless there is a significant shift in consumer behavior or innovative strategies from industry players. The trend suggests that distilleries and related businesses will need to adapt to changing consumer preferences and economic conditions to survive.