Jack Daniel’s parent company, Brown-Forman, is bracing for the impact of Canada’s boycott of American liquor, but CEO Lawson Whiting has called the move a “disproportionate response” and even “worse than a tariff.”

Whiting made the statement during an earnings call, as reported by CNN, in response to Canada’s decision to pull American liquor brands off store shelves. The move is part of broader retaliatory actions following tariffs imposed by the Trump administration.

Impact on Jack Daniel’s and Brown-Forman

While Canada accounts for only 1% of Jack Daniel’s total sales, Whiting acknowledged that the company could withstand the impact. However, he raised concerns about Mexico, which makes up 7% of the brand’s sales and is also facing US tariffs.

In addition to the liquor boycott, Canada has imposed a 25% retaliatory tariff on American goods, including wine, spirits, and beer. This comes at a time when Brown-Forman is already facing a slowdown in demand across key markets, including the US, Canada, and Europe.

Despite strong sales in emerging markets like Mexico and Poland, the company reported a 3% decline in net sales, bringing its revenue down to $1.04 billion—falling short of analysts’ expectations of $1.07 billion.

Broader Economic Challenges

The Canadian boycott is part of a larger trend, with Canadians reportedly moving away from US goods, sports events, and travel. This shift, coupled with economic pressures on the spirits industry, has prompted Brown-Forman to implement cost-cutting measures, including layoffs.

Industry analysts suggest that the company’s struggles are reflective of a broader downturn in the spirits market, rather than being solely attributed to Canada’s actions. However, with mounting trade tensions and shifting consumer behaviors, the future remains uncertain for major liquor brands navigating the global market.

Sources By Agencies