For more than 250 years, Jose Cuervo, S.A. de C.V. has harvested blue agave plants in central Mexico to produce and distribute tequila. The company leads its industry with a distribution network that reaches around the globe. Rachel Hartman reports on a Mexican company that relies on history, prestige and quality to produce the number-one selling tequila in today’s market.
In 1758, more than 50 years before Mexico became an independent state, Jose Antonio de Cuervo obtained land from the king of Spain. The property was located in the central state of Jalisco, and upon this territory Cuervo grew blue agave plants to produce tequila. Several years later, the family received the first official permit from Spain’s monarch to produce tequila commercially.
Subsequently, the company continued operations through more than two and a half centuries. Today it leads the tequila industry: In 2009, overall Jose Cuervo sales hit 7.2 million nineliter cases.
Jose Cuervo is the number-one tequila in the world, and its product ranks seventh within the overall spirits category, reveals Cristobal Mariscal, general counsel and external affairs director for Jose Cuervo.
How did Jose Cuervo rise to the top? “From having a long-term view and a fully integrated supply chain from the agave fields,” answers Mariscal. “An agave plant takes six to seven years to mature. We need to plant agave now to produce tequila that consumers will drink seven years from now.”
Mariscal also attributes the company’s success to its extended history and improved production methods. “Jose Cuervo has been a family operated enterprise from the beginning, and through 13 generations, our commitment to history, tradition, and product quality placed us where we are today,” he says.
FIRST IN LATIN AMERICA
On the land he was granted, Jose Antonio de Cuervo built a distillery now called La Rojeña. Located in the city of Tequila, its operations began in 1812, making it the oldest active distillery in Latin America. With its new base of operations at La Rojeña, the company began selling tequila throughout Mexico.
By 1873, the demand for Jose Cuervo tequila had grown and even reached the United States. The company shipped its first documented export across the border, sending three bottles of Cuervo on the back of a donkey. Demand continued to increase and, in 1934, Jose Cuervo officially entered the exporting business.
Today Jose Cuervo products are sold in Asia, Europe, Africa, the South Pacific, South America, Central America, North America and the Caribbean. According to Mariscal, the company exports approximately four million cases to the United States each year. Two million cases of tequila are sold in Mexico, and 1.2 million cases are sold in other export markets. “We are the best-selling tequila brand in the United States and also the number one tequila company in Mexico,” he adds.
To carry out its operations, Jose Cuervo employs 3,300 workers; of these, 1,800 work in the agave fields. The company has more than 2,000 contractual arrangements with independent farmers in central Mexico. It oversees the planting and harvesting of agave in more than 25,000 hectares of plantations.
Mexican law protects the growing of tequila and only allows blue agave plants to be grown in certain areas. All of the land administered by Jose Cuervo is located within the denomination of origin zone, as dictated by the tequila standards in Mexico. The company currently has around 45 million agave plants at different stages of the maturing process.
Blue agave plants need to spend an average of seven years in the ground before they can be harvested for tequila production. When they are cut down, the leaves are removed to reveal the heart of the plant, often called the piña, or pineapple, due to its resemblance to the fruit. The agave hearts then begin the distilling process.
Jose Cuervo currently has two distilleries: La Rojeña in the city of Tequila and Los Camichines in the town of Zapotlanejo. Both are in the state of Jalisco.
The company has a bottling facility in the city of Guadalara, just a few hours from the distilleries. Its headquarters are located in Mexico City. It also has offices in Miami, New York, London and Hong Kong.
Jose Cuervo distributes a variety of tequila products, including Jose Cuervo Tradicional, which has been produced since 1795 and is aged in oak barrels for a smoother taste; Jose Cuervo Especial Gold, the number one selling tequila in the world; and Jose Cuervo Especial Silver, a smooth, colorless tequila.
Reserva de la Familia is often referred to as the Jose Cuervo family’s finest tequila. For more than 10 generations, the product was actually a family secret shared with only a handful of friends. In 1995, the company opened this line to the public and launched Reserva de la Familia, an extra-añejo tequila which is aged for at least at least 36 months in barrels before it is bottled.
Rounding out the company’s portfolio is Jose Cuervo Platino, a handcrafted, ultra-premium silver tequila made from 100 percent blue agave. To make Platino, the company uses a process called “Esencia de Agave.” During this process, the most flavorful agave hearts are selected from the fields and then slow cooked, which adds unique, complex flavors to the finished product.
According to Mariscal, Jose Cuervo has experienced steady growth during the last few years. “Like other industries, we have faced challenges imposed by the world economic crisis,” he explains. “However, we’ve successfully managed those challenges because of our product quality and the customer loyalty demonstrated throughout the world.”
To stay on top of its industry, Jose Cuervo has invested in both its distilleries and land. “We have upgraded our distilling capabilities, our aging facilities and our bottling equipment,” says Mariscal. “And we have been more efficient in the number of plants required.”
This has allowed the company to create more products without increasing the amount of land used in the process.
In recent years, Jose Cuervo has received a number of awards and recognitions. Some of the more notable of these include the national award for quality and a national award for its successful exporting business. “We’ve also been recognized as a socially responsible company and as one of the best employers in Mexico,” Mariscal adds.
In the area of social responsibility, Jose Cuervo focuses on developing sustainable growth for the citizens of Jalisco, the state where the majority of the company’s operations are carried out. “We promote family values, the responsible consumption of our products, cultural activities, Mexican traditions and handcrafts,” says Mariscal. Jose Cuervo has also made an effort to promote the city of Tequila as a tourist destination. “We’re building better citizenship, advancing Mexican values with respect to the culture, and promoting the economic development of the area.”
Jose Cuervo is also involved in organizations that work to reinforce the values of responsible drinking. The company promotes the following guidelines: no drinking and driving, no supplying to minors, total acceptance of the right to not drink, and responsible consumption of its products.
What’s next for the world’s leader in tequila? The company plans to stay right where it is in terms of sales, and that’s on top. “It’s clear that we’re the leader of the industry – we have been for many years,” Mariscal says. “And we expect to continue as the leader in the tequila category in the future.”