What three years of market turbulence taught us about leadership, teams, and the enduring pull of a great industry

Three years ago, Wine and Spirits leadership was at the heart of Perpetual’s most active sector. Ten of our top twenty client relationships were with producers, importers, distributors, and on-trade operators in the category. Executive search mandates were flowing. The industry was in the middle of a post-pandemic surge, premiumization was accelerating, and boards were investing in leadership.

Today, two of our top twenty clients come from the sector. The search mandates have contracted sharply. Hiring freezes, portfolio rationalization, and cost restructuring have become the dominant conversation.

And yet, here is the thing. We are more engaged with Wine and Spirits leadership teams right now than at any point in the firm’s history. The work has simply changed. The questions our clients are asking are different. And if you understand why, I think you understand something important about where this industry is heading – and what it takes to lead through a market that is simultaneously challenged, volatile, and still one of the most fascinating categories in consumer goods.

the market is not broken. but it is recalibrating hard.

The structural story is well documented. Still wine volumes have declined across key Western markets for three consecutive years. Mainstream spirits are facing real distribution headwinds. The post-pandemic destocking cycle – which hit vodka and whisky categories particularly hard – has seen some of the largest drinks groups restructuring their distribution footprints. Brown-Forman shifted distributors across fourteen US markets in 2025, including New York, Texas, and California. Pernod Ricard USA reorganized into separate commercial divisions for RTD and its incubation brands, explicitly chasing different go-to-market economics.

The craft segment is in genuine difficulty. The American Craft Spirits Association reported a 6.1% volume decline in 2024, with closures accelerating and access to capital tightening. Distributors, under pressure from large brand partners, have less appetite to take on new entrants. The playing field, as ACSA CEO Margie Lehrman has noted plainly, is not level.

At the same time, pockets of the industry are performing exceptionally. Premium American whiskey continues to command pricing power and consumer trust. Tequila’s ascent – and its expansion from its home market into international categories – remains one of the more remarkable category stories of the decade. Mexico is now the number eight market globally for premium spirits and the seventh largest RTD market in the world. Champagne and prestige wine are holding. The category is not in crisis. But it is in a period of meaningful recalibration that is forcing organizations to make harder choices about portfolio, distribution, talent, and capital allocation.

from search to consulting: what our client work told us

When executive search mandates dried up in Wine and Spirits, we had a choice. We could wait for the hiring market to return – and it will – or we could pay closer attention to what our clients were actually asking for.

What they were asking for was not recruitment. It was help making their existing organizations perform better in conditions none of them had planned for.

The work we have been doing over the last eighteen months looks different from what we were doing before. High-performing team programs. First team alignment. Strategic planning facilitation. Navigating distributor changes and the team dynamics that come with them. Leadership integration following M&A transactions. Succession planning in an environment where external hiring is constrained and development from within has become the primary talent strategy.

The underlying need, though, has not changed at all. Leaders across this sector are dealing with the same fundamental challenges they always have: clarity of direction, prioritization under pressure, trust within the team, and the ability to hold people accountable in a culture that is often relationship-driven to a fault. The volatility has simply made those challenges more visible and more urgent.

three Wine and Spirits leadership dynamics we are watching closely

1. distribution disruption is a team dynamics problem

The wave of distribution restructuring across North America – driven by destocking, portfolio rationalization, and the RTD channel shift – is not just a commercial challenge. It is a leadership and team dynamics challenge that most organizations have underestimated.

When a major producer changes distributors across multiple markets simultaneously, the consequences ripple through the commercial team at speed. Relationships that took years to build are reset overnight. Priorities shift. Territory structures change. Commercial leaders who built their networks around a particular distributor relationship have to rebuild from scratch – often with less support, smaller teams, and tighter timelines than they had before.

The organizations navigating this best are the ones who treated it as a change management program, not just a commercial transition. They invested in aligning their leadership teams around a shared approach. They communicated clearly and frequently to their people. They acknowledged what was being lost even while making the case for the change.

The ones struggling are the ones who announced the structure, assumed execution would follow, and then wondered why performance was inconsistent twelve months later.

2. m&a integration: the human work that is still left undone

The consolidation wave of the last five years reshuffled leadership talent across Wine and Spirits at an unprecedented rate. New org charts were published. New reporting lines were drawn. And then, in most cases, the hard work of building actual alignment – shared decision-making frameworks, trust across inherited teams, a common language for priorities and performance – was left to happen on its own.

It does not happen on its own. We have seen this pattern consistently: a transaction is technically integrated within twelve months, but the leadership team is still operating as two organizations two years later. They duplicate effort. They second-guess each other. They protect legacy priorities instead of building toward shared ones. The commercial performance consequences are direct and measurable.

The organizations that get M&A integration right treat the human work as an active program, not a passive outcome. They bring leadership teams together deliberately. They create structured environments for building trust and resolving the ambiguity that every integration inherits. This is not a soft intervention. It is one of the highest-return investments a business can make in the 12-24 months following a transaction.

3. the capability gap is widening in premium commercial roles

Premiumization is not a trend anymore. It is the operating model. Premium and super-premium now represent the primary value creation engine for most serious Wine and Spirits organizations. But the commercial capability infrastructure – the skills, the mindsets, the selling behaviors – has not kept pace.

You cannot build a luxury spirits franchise with a volume sales culture. The conversations are different. The channel relationships are different. The storytelling, the pace, the patience required to develop an on-premise presence with the right accounts – all of it demands a different kind of commercial leader than the ones most businesses built their bench around during the growth years.

This is not a criticism of the people. It is a systems observation. Most organizations did not invest in developing their commercial teams for premium execution while the market was growing. Now that growth has slowed and margin management has become more critical, the gap is becoming impossible to ignore.

what has not changed

The market is volatile. The headlines are often difficult. The category is working through a genuine reset. None of that changes the fundamental nature of what great leadership looks like in this industry – and none of it diminishes our conviction that Wine and Spirits will be back.

The brands are extraordinary. The category has cultural depth, geographic diversity, and consumer passion that very few sectors can match. The craft of making great wine and great spirits has not declined. The global consumer appetite for authentic, provenance-led, premium products has not declined. What is declining is the tolerance for organizations that do not execute well, for brands that do not earn their position on shelf, and for leadership teams that are not aligned enough to move at the speed the market now requires.

The organizations that will be best positioned when conditions improve are the ones making the internal investments right now. In their teams. In their leadership systems. In the clarity and alignment that allow great people to do great work without friction slowing them down at every decision point.

That has always been true. It is just more obviously true when the market is not covering up the gaps with volume growth.

what perpetual brings to this sector

We have been working inside Wine and Spirits organizations for over a decade. We understand how this category works – the three-tier dynamics, the on-trade relationships, the rhythm of brand-building, the regulatory complexity, the way culture and heritage intersect with commercial execution in ways that are genuinely different from other parts of consumer goods.

That understanding does not come from observation. It comes from sitting in the room with leadership teams that are navigating these challenges in real time. It comes from having worked with producers, importers, distributors, and on-trade operators across multiple market cycles. It comes from relationships that have been built over years, not transactions.

The work we do now – high-performing team programs, first team alignment, strategic planning, leadership integration – is different in form from the executive search work that dominated our earlier engagement with the sector. But it is continuous in purpose. We are still doing the same thing we have always done: helping great organizations build the leadership capability to execute on their potential.

We also know this: the executives who are leading Wine and Spirits organizations through this period are some of the most capable commercial leaders in consumer goods. They are navigating genuine complexity – macro headwinds, distribution disruption, category evolution, portfolio rationalization, and team dynamics – simultaneously, with less resource than they had three years ago.

They deserve partners who understand the industry they are operating in. And they deserve interventions that are built for their actual situation, not repurposed from a different sector playbook.

the industry will be back. the question is who will be ready.

The reset the North American and global Wine and Spirits market is working through is real. It is also temporary in the ways that matter. The consumer love for this category – for great whisky, for extraordinary wine, for the ritual and the story and the craft behind what is in the glass – is not going anywhere.

The organizations that will lead the recovery are not the ones with the best strategy documents. They are the ones that used this period to build something that will outlast the current conditions: a leadership team that operates with genuine alignment, a commercial organization with the capability to execute at premium, and a culture that develops the next generation of leaders rather than waiting to hire them from somewhere else.

At Perpetual, we are not waiting for the hiring market to come back before we show up in this industry. We are here now, doing the work that matters now. Because we believe in what Wine and Spirits is, what it can be, and the leaders who are building its next chapter.

If this reflects what you are navigating, we would welcome the conversation.