Isle of Harris Distillery has initiated a restructuring programme that will include a reduction in both production levels and workforce at its distillery.
In a statement, managing director of the Scottish gin and whisky maker Simon Erlanger said the decision was being made “to safeguard the future of our business”.
He added the move was "deeply regrettable".
Specific details regarding the number of job losses or the departments affected were not disclosed..
Erlanger added: “Much like our colleagues in the wider spirits industry, we are facing challenging headwinds which have led to some incredibly difficult decisions.
“Following a number of cost-cutting measures, voluntary redundancy is being offered to staff in the first instance, with compulsory to follow thereafter if we do not fulfil our cost reduction target."
Global exports of Scotch whisky declined in value terms but increased in volume terms in 2024, recent figures from the Scotch Whisky Association (SWA) show.
Exports by value stood at £5.4bn ($6.7bn) last year, marking a 3.7% decrease from 2023.
Founded in 2015 and based in Harris, part of Scotland’s Outer Hebrides, Isle of Harris Distillery currently has 45 employees.
It produces Isle of Harris Gin - distilled with locally harvested sugar kelp seaweed - as well as its single malt whisky, Hearach.
Its products are available in 20 countries, with key markets including the US, UK, France, Germany, and the Netherlands.
In December 2022, the distillery secured £10m (then $12.1m) in funding from HSBC “to venture into new markets and expand our international footprint”.
With the funding, the distillery also built two new warehouses on the island.
In the statement, Erlanger added: “To date, Isle of Harris Distillery represents a £20m+ investment in the island economy.
“We remain true to our founding purpose as a sustainable, multi-generational firm built to support the community for many years to come. The regrettable measures now being taken are necessary to help fulfil that long term vision.”
