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Stoli Group USA, the maker of Stoli vodka, has filed for Chapter 11 bankruptcy in the United States. The company, which also owns Kentucky Owl Bourbon, Villa One Tequila, Achaval Ferrer wine, and Bayou rum, cited financial difficulties as the reason for the filing. According to the bankruptcy documents, the company has liabilities ranging between $50 million and $100 million. The bankruptcy filing only impacts the company's U.S. business, and its products will remain on store shelves throughout the process.
Stoli has faced several challenges recently. The spirits industry has seen a decline in sales, particularly among younger Americans who were once the primary consumers of Stoli vodka. According to Fortune, data from the Wine and Spirits Wholesalers of America indicates that spirit sales were down nearly 4% year over year in the 12 months through August 2024.
In addition to the decline in sales, Stoli has been dealing with the aftermath of a significant cyberattack that forced the company to rebuild its systems and operate manually. The company has also been involved in a long-running legal battle with the Russian government, which has further impacted its finances.
Stoli was sold as Stolichnaya in the U.S. until 2022, and it was implied to be a Russian product. However, the invasion of Ukraine by Russia led to boycotts, and the company had to reeducate customers that Stoli was actually made in Latvia. The company's Russian-born founder had been exiled from Russia in 2000.
Numerous brands and retailers have been struggling due to tough economic conditions and the changing spending habits of the younger generations. Hearthside Food Solutions, Big Lots, Red Lobster, Express, TGI Fridays, Vitamin Shoppe, and American Freight are just a few of the many that have declared bankruptcy.