Not every company can use its product to fund its employees’ pensions. But Diageo, which produces Johnnie Walker, has managed to do just that. The company has handed over ownership of $645 million worth of whiskey to a pension fund. If the company goes bust, the employees could get to keep the scotch, though it’s more likely they’d sell it for market value and take the cash.
The way the plan is structured, nobody expects the employees to take their retirement pay in whiskey, though it’s theoretically possible if the company goes under. The fund really works by providing a steady stream of cash to the pension as the scotchmatures:
“A pension funding partnership will be formed, which will hold maturing whiskey spirit as assets,” Diageo, which also makes Guinness stout and Smirnoff vodka, said in a statement.
As part of the deal, Diageo agreed to pay the pension partnership £25 million a year as it sells the recently distilled whiskey once it matures after three years and replaces it with new stock. The agreement would expire after 15 years, at which point Diageo would buy back the whiskey, which comes from distilleries such Oban on the west coast of Scotland.
What if the workers really decide they’d prefer hooch to cash? They may just have to settle for employee discounts.
Diageo Uses Scotch to Plug Gap in Pension Plan – [NYTimes.com]
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This is perfect, but I hope to see other companies doing this in the future. This might work well in the porn or brothel industry. We the company are setting aside 200 hookers for all our employees retirement.
But aren’t the hookers already them employees?
Not to mention hookers don’t go up in value with age.
that’s the problem with depreciating ASSets.
its all about selling it to the right person.
Oh come on, this is the new century, MILFS, GILFS and cougars are the in thing.
except MILFS and Cougars are generally rich women who have nothing to do all day but yoga and making sure the maid scrubbed the toilets while the nanny walks the kids to and from daycare.
Old, overly worked hookers don’t age well.
Odd that it’s in the quote as well (the picture gets it right) but the term for Johnnie Walker and all other scotch is ‘whisky’, no e. Unless someone who’s a more educated alcoholic than I can offer a more informed opinion, at least.
From wikipedia (http://en.wikipedia.org/wiki/Whiskey):
“Much is made of the word’s two spellings, whisky and whiskey. Today, the spelling whisky (plural whiskies) is generally used for whiskies distilled in Scotland, Wales, Canada, and Japan, while whiskey (plural whiskeys) is used for the whiskeys distilled in Ireland and the United States. However, several prominent American brands, such as Maker’s Mark and George Dickel, use the ‘whisky’ spelling. When writing generally about this type of spirit, either spelling is correct.
‘Scotch’ is the internationally recognised term for ‘Scotch whisky’ however it is rarely used in Scotland, where the drink is called ‘whisky’.”
Also helpful:
http://www.thekitchn.com/thekitchn/whiskey-vs-whisky-whats-the-difference-straight-up-cocktails-and-spirits-100476
I thought Johnny Walker was Irish Whisky, not Scotch. Still, I’m a bourbon man myself. Maker’s Mark.
It’s whisky, not Scotch!
Damn ‘merkins.
Scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch scotch.
Sorry
I readily admit I know nothing about the appreciation (in $$$, not in a yum-yum context) of alcoholic beverages. Would their return on investment on this stuff be equivalent to, say, investing that same amount in real estate or some other traditional investment type option?
You hear in the news about bottles of hooch bringing big bucks, but I didn’t think this brand fell into that category.
Well, they actually make the product, so it’s easier this way. They don’t have to worry about retail markup and other issues.
Johnnie Walker has a few different lines, and some of them are meant to be the kind that catch big bucks when they age.
Thanks! I got that this is all they had to give, I was just wondering how long it would take for their “off the shelf” product(s) to appreciate in value.
Red 3 Year, Black 12 Years, Green 15 Years, Gold 18 Years, Blue only a handful are made and put out each year. Its a number bottle, some have case, etc to them.
Red, Black, Green, Gold, Blue (Cook with them). $20, $40, $80, $100/$160, $300/$360.00
SHUT UP! That’s why. Don’t you tell me how to pension in my invest. I was in the war, dammit. I jumped out of a plane, and you want to tell me when I’ve had too much to invest? Get out of here!
::throws bottle::
This is really win-win. If the employees can sell the whisky, they’re in good shape. If not, well, the subsequent drinking habit is paid for.
cool. somewhere i read that when you have a child, buying them a case of nice scotch every year can give them a nice trust fund for when they are ready to start out on their own. similar principle, i guess.
It is a readily liquid asset.
It is a readily liquid asset.
Ah we’re drinking and we’re dancing
and the band is really happening
and the Johnnie Walker wisdom running high
And my very sweet companion
she’s the Angel of Compassion
she’s rubbing half the world against her thigh
(okay okay it’s not relaed to the post exactly, but when is it ever a bad time to share some of lenny cohen’s lyrics?)
This is actually a very positive thing. Seriously. The assets in question will remain very valuable for the entire length of the retiree’s lifespans and then some, and in the case of a serious financial collapse will be worth a lot more than mere paper money.
This is actually a responsible move.
I’d prefer a nice wheel of cheese for a shorter-term investment, but yes, the principle is sound.
If Ben_O2′s numbers are right, and 18 year whiskey costs 15 times as much as 3 year whiskey, that’s equivalent to about an 18% interest rate. Very impressive.
One step closer to a whisky-backed currency.