Tequila and Bacardi: An Unsavory Cocktail?

Tequila and Bacardi: An Unsavory Cocktail?

Francisco Alcaraz was a master distiller of tequila whose scientific knowledge, passion, and unconditional commitment to quality contributed to producing Patrón, one of the best tequilas in the world.


Video spotlightPatrón Tequila: Our Story


Along the way, the business success of Patrón has attracted many investors, including Bacardi.

Will Bacardi’s business model of favoring industrial over artisanal production pose a risk to the quality reputation of Patrón?

 

This post is based on the Bloomberg article, Patrón Made Tequila Top-Shelf. Will Bacardi Dilute It?, by T. Genoways, July 31, 2018. Image source: C Squared Studios/Getty Images.

Discussion Questions:

1. According to the Kano model, what type of quality does Alcaraz want to produce? Will there be a shift if Bacardi wants to boost volume?

Guidance: Review basic quality, performance quality, and excitement quality. Given Alcaraz’s insistence on premium quality as opposed to volume, he aims at producing tequila that will deliver excitement quality. The blind taste test at Spago provides further evidence of this approach to quality. Discuss the potential for a “downgrade” to performance quality if Bacardi wants to boost volume.

2. What are the pros and cons of Bacardi’s production methods?

Guidance: With its other brands, Bacardi has focused on high volume production. Producing in high volume has several advantages: standardization, lower costs and therefore higher profit margins, larger presence on world markets, etc. However, a move from artisanal to industrial production also has its disadvantages: loss of market share among connoisseurs, lower reputation, increased competition in a crowded market.

3. In the article, which dimensions of product quality does Alvarez want to emphasize?

Guidance: Use your textbook’s list of the dimensions of quality (see e.g. Stevenson 13e, p. 378) to guide discussion. High performance, aesthetics (taste), special features (100% agave), perceived quality, and conformance are high priorities (order winners). The others (e.g. durability or ageing of tequila) are probably qualifiers.

4. What is the importance of statistical process control and process capability in the production of tequila?

Guidance: The Bloomberg article underscores the science involved in designing and producing tequila. SPC is especially important for premium tequila. The chemists and distillers must monitor various physicochemical properties such as conductivity, density, pH, viscosity, etc. Premium quality requires adherence to tight tolerances. Low variation and proximity to target values will be reflected in Cp and Cpk ratios.

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