Page 1

SUMMER 2015

6

SIGNS IT’S TIME FOR A

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GUILD REPORT

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TABLE of CONTENTS A LETTER FROM THE EDITOR

8

MICROBIAL CONTAMINATION

66

Implications for distilled spirits producers

GUILD UP

11

How forming a state distillers guild can improve your business

QUARTERLY U.S. GUILD REPORT 13 What’s going on, state-by-state

IN-MASH MILLING PART ONE

24

An investigation into making distillery operations safer

ACSA COMMITTEE UPDATES

29

from the Board of Directors of the American Craft Spirits Association

NOTES FROM THE WORLD WHISKIES & SPIRITS CONFERENCE

70

Summaries of every panel from this special conference

A CRAFTED SHIP KNOWN AS PHILADELPHIA DISTILLING

73

of Philadelphia, Pennsylvania

HOW TO SCREEN FOR THE BEST EQUIPMENT MANUFACTURER FOR YOU

76

Ask the right questions

OUR STORY

33

Make community your secret weapon

HOW I QUIT MY CORPORATE JOB TO MAKE WHISKEY 80 Why you should consider hiring an apprentice

LOCAL LOUISIANA

35

Louisiana Spirits of Lacassine, LA

SAXTONS RIVER DISTILLING

83

of Brattleboro, Vermont

BLENDING SPIRITS 38 The art of combining the right barrels to achieve your desired product

BECAUSE WHO DOESN’T HAVE AN EMAIL ADDRESS? 85 Advice on email and newsletter marketing

DISTRIBUTION ELOCUTION

43

On choosing and working with a distributor

A FIRST-TIMER’S ADI CONVENTION RECAP

88

A personal account

BETTER WAREHOUSING FOR BETTER SPIRITS

46

Provide a healthy environment for your maturing barrels

SAVE THE SWEETSHINE

ACT II: NOW WHAT?

91

Support Structures and Infrastructure

50

A fight against the tax man in West Virginia

STATE OF THE UNION

93

Michael Kinstlick’s updated industry white paper

6 TELLTALE SIGNS IT’S TIME FOR A PACKAGE REDESIGN

53

A YEAR IN REVIEW

97

Black Button Distilling

The time will inevitably come

BYPRODUCT TO PRODUCT LINE

55

Turning your spent grains into a revenue source

DAY JOBS AND DISTILLING

CRAFT MADE TONIC

60

DIY: SAFETY OVERVIEW

63

ADVERTISER INDEX

Monthly Report of Storage Operations TTB Form 5110.11

ENDLESS ONLINE SHELF & RELATED BRAND CHALLENGES

102

A big player in the budding craft mixer market

104

Build it yourself

The need for constant brand “dripping”

from the COVER

100

An overview on the historic and detailed process of creating tequila

58

When pursuing your dream is how you use your “free time”

DSP FEDERAL REPORTING

TEQUILA 101

Kings County Distillery in New York, New York. Image by Amanda Joy Christensen.

106


Issue 11 /// Summer 2015 PUBLISHER & EDITOR Brian Christensen CREATIVE DIRECTOR Amanda Joy Christensen SENIOR WRITERS Amber G. Christensen-Smith Chris Lozier

Steven Seim

CONTRIBUTORS Lisa Barlow Jason Barrett Amy Brownstein Kate Cardinali Ralph Erenzo Harry Haller Patrick Heist, Ph.D Michael Kinstlick Maisie MacKinnon

Ryan Malkin Jim McCoy Courtney McKee John McKee Susan Mooney Carter Raff Jeanne Runkle David Schuemann

ILLUSTRATOR Dietmar Klein PHOTOGRAPHERS Amanda Joy Christensen Foodtopia

Maisie MacKinnon John McKee

SALES & MARKETING Ashley Monroe innovative & custom solutions

20+ years experience 100% dedicated customer service

ARTISAN SPIRIT is the endorsed publication of the American Craft Spirits Association. ARTISAN SPIRIT is a quarterly publication by Artisan Spirit Media. www.artisanspiritmag.com facebook.com/ArtisanSpiritMagazine

gdchillers.com

twitter.com/ArtisanSpiritM

1.800.555.0973 General Inquiries (509) 944-5919 Advertising (509) 991-8112 PO Box 31494, Spokane, WA 99223 All contents © 2015. No portion of this magazine may be reproduced without the written consent of the publisher. Neither Artisan Spirit Media nor ARTISAN SPIRIT magazine assume responsibility for errors in content, photos or advertisements. While ARTISAN SPIRIT makes every effort to ensure accuracy in our content, the information is deemed reliable but not guaranteed. We urge our readers to consult with professional service providers to meet their unique needs. At ARTISAN SPIRIT, we take the opportunity to enjoy many different craft spirits and adult beverages. However, it’s also our responsibility, and yours, to always drink responsibly. Know your limit, and never drink and drive. ARTISAN SPIRIT’s number one goal is to share and celebrate the art and science of artisan craft distilling. But please remember to follow all the laws, regulations, and safety procedures. Be safe, be legal and we can all be proud of the industry we love.


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FIRST PIECE OF ADVICE. Industry partners often find themselves in the role of educating new clients; beginning and established distillers alike. Each of them have their go-to piece of advice they give distillers who walk through their door. A big thing they want each and every distiller to know...

With any distiller, whether novice or advanced, there is usually a whole laundry list we like to go over with new customers. From pricing to barrel style, to barrel age times, and barrel lead times. With the current barrel shortage everyone is dealing with, the most common bit of advice we’ve been giving out lately is to plan ahead to the best of your ability. It’s hard to wrap your mind around anything a year+ out, but almost any variable can be tweaked as you go. — Heidi Karasch

Many of the distillers we speak to are in the early stages of developing their distilleries and/ or brand. Of course, they face a number of large investments when beginning their companies. Too often, though, distilleries we speak to have not properly planned for the costs associated with branding and marketing services and thus have not established the proper budgets, or worse, a budget at all. Consider this: when a potential consumer encounters a new brand, they will have little to no information to go by in making their purchase decision – other than the packaging. Consider the 80-20 rule. 80% of a consumer’s initial purchase decision is based solely on the packaging and only 20% is based on what they have read, heard or had recommended to them. Design fees should be treated as an investment that will last for years and will build the foundation for their brand’s market success. — David Schuemann

ILL DIST PRO BY

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The strategy we share with distilleries is that one of the most cost effective ways to boost brand exposure is to develop a complete line of custom distillery merchandise for their tasting room, gift shop and e-store creating a profit center and extended brand exposure. Distillery merchandise has the ability to travel far beyond the geographic boundaries of the distillery giving brand awareness wherever the products travel. One of the greatest benefits of branded distillery products is that they are unobtrusive and are not viewed as advertising. Beyond the distillery doors custom branded merchandise motivates, rewards, retains, grows and celebrates the craft distillery. Custom distillery merchandise is one of the most effective marketing tools in “Lifting Your Spirits.” — Janie Cantrell

We take people into our “Distiller’s Deprivation Tank”, a small room kept at a humid 90° F with loud ambient noise, where they are required to look at a thermometer for 4 hours. Once they’ve experienced this simulated distillate production, we give them 3 hours of paper work to fill out. When time’s up we ask them, “Do you still want to be a distiller?” Whoever responds affirmative gets a glass of water and a hug…and a warning not to call themselves a master distiller until they earn it. — Colin Blake

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Our mission at ARTISAN SPIRIT is to share and celebrate the art and science of artisan craft distilling. We are humbled by the support of our sponsors. With their help, we can further our common goals Looking across all the categories we serve, one thing we’ve seen our of supporting creativity, most successful partners do is fully leverage their relationships with innovation, and integrity their suppliers. If you limit your interaction with your suppliers to transactional within the industry exchanges, you might be missing out on unexpected opportunities for them to help we all love so you build your brand. Instead, ask them what else they can do for you and challenge them much. to go above and beyond as a partner. At O-I, for example, we use our social media reach and other marketing channels to help promote our customers – you can see examples of this at our Covet LinkedIn Page: www.linkedin.com/company/covet. — Danielle Catley

In watching the larger spirits companies, one can see trends based on their product offerings. They have increased the number and marketing of premium and super premium products. I believe that after consumers move up the spirits chain, in terms of value, they do not trade back down quickly. As consumers are becoming more confident and millennials are moving up the corporate ladder, now is the time to get them into your higher value products. — Kevin Dunbar

I often have two very big pieces of advice to new distillers. First and foremost, you need an authentic brand story with a disruptive package and label that aligns to that brand story. Think about the texture of your label, the artwork, words you use on the label, because all of these elements should align to your brand story. The label should be one of your most important investments to your brand. This is where your consumer will have their first touch point with you. Second, know your growth strategy and the steps by which you will get there. Ensure you understand the different options you have to grow. — Eli Aguilera

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A LETTER FROM THE EDITOR: The personal touch. It’s a numbers game. Damn near every article I’ve read recently (and a few we’ve written) on the topic of craft distilling begins by mentioning the industry’s massive growth, inevitably followed by some number or another highlighting how many craft distillers are opening, operating or producing. Important numbers, and morale boosting for sure, but numbers can’t tell the whole story. Admittedly, those numbers also have value aside from marketing and morale. The more craft distillers combining their voices means politicians and legislatures listen. Ten craft distillers can get something accomplished in government that one simply could not. State guilds, which we cover extensively in this issue (see page 13), are the physical manifestation of this unified voice. The big producers and their lobbying groups like DISCUS love having more numbers to add to their economic impact and jobs growth statistics. And these new numbers are usually small businesses to boot, which can garner public support in a way that big companies can’t always do. Those numbers can get people’s attention, but once you have them looking, it’s still the individuals that need to seal the deal. Surprisingly it was a politician, Congressman Todd Young of Indiana, not a distiller who reminded me of this recently. He made it clear that craft distilling’s growth was something that he and his peers were noticing, but it was the actual distillers, owners, and representatives from the industry walking into his office that really got his attention. Each individual that shows up and shakes hands with a governmental representative leaves an impression, and gives context that numbers alone will never provide. This is true on a local, state, and federal level. So, if you want to get that next piece of legislation passed, get a new client, or sign a distribution deal the advice is the same:

Get out there and shake some hands.

Brian Christensen

CALL:

(509) 944-5919

EMAIL:

brian@artisanspiritmag.com

WRITE:

PO Box 31494 Spokane, WA 99223

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GUILD UP

How forming a state distillers guild can improve your business written by RYAN MALKIN

A guild, according to the Oxford English Dictionary, is “an

politicians are strongly averse to controversy. If two business

association of people for mutual aid or the pursuit of a common

owners ask for two different things, it’s a conflict that Nicole

goal.” Distilling may be an individual effort within the confines of

Austin, director of the New York State Distillers Guild and

your distillery, but to improve the greater business environment

master blender at Kings County Distillery, says will “stop the

within your state and the overall distilling community, associating

process from moving forward.” To avoid infighting, which can

with other distillers in your state and forming a guild is likely to

be a distraction from “the true purpose of the organization,”

be as vital to your long term growth as a larger still.

you need to adopt and follow your articles of incorporation and

Just take Florida: The Florida Distillers Guild was able to get legislation passed to allow for limited bottle sales from distilleries, a huge boon to improving distillery tourism. Similarly,

bylaws.

WHERE DO YOU START?

the Distillers Guild of Alaska helped pass legislation “allowing

Start with reaching out to all of your fellow distillers. A few

for tastings, sales in small amounts for on-premise consumption

people will no doubt be willing to take the lead on getting things

and limited direct sales for off-premise consumption,” according

moving administratively. “Being professional from the start is

to Heather Shade, president of the Distillers Guild of Alaska and

absolutely essential to a guild’s success,” advises Austin. You

owner of Port Chilkoot Distillery. Similarly, by becoming a guild,

can certainly seek the assistance of a local attorney who may or

Montana distillers helped pass a law allowing the microdistillers

may not be willing to provide pro bono assistance. If you go at

in the state to distribute directly to liquor stores of choice, as

it on your own, review the requirements for forming a nonprofit

opposed to relying on the state liquor board to decide, says John

trade association in your state. Then register as a not-for-profit

McKee, owner/distiller of Headframe Spirits and president of the

trade association (or similar state designation) and appoint an

Montana Distillers Guild.

interim board to adopt bylaws and articles of incorporation.

The list of accomplishments by individual state distilling

Samples of articles of incorporation and bylaws to get you

guilds grows day-by-day. Being a group of distillers, as opposed

started are available at the American Craft Spirits Association

to a collection of distilleries each representing their own

website (www.americancraftspirits.org). The bylaws and articles

interests, gives the guild “a unified voice in front of legislatures

of incorporation set out the goals, functions and operations of

and liquor control boards,” says Jason Parker, co-owner/distiller

the guild. “It’s your opportunity to decide as a group not only

at Copperworks Distilling Co. and president of the Washington

the structure but the functions and priorities for the guild,” says

Distillers Guild. Individual business owners will no doubt have

Austin. In Alaska, for instance, the guild is represented by a

differing opinions and want different things from the state, but

board of directors elected by voting members. You’ll also want

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to apply for a Federal Employer Identification Number, open

New York distilleries, in addition to $250,000 to build a guild

a bank account and consider obtaining directors and officers

website.

liability insurance. Now you’re ready to hold your first meeting and look to your first board elections.

As your guild matures, you can also begin taking advantage of your collective buying power. The Washington guild, formed

The board may choose to establish committees to divide

in 2008, has banded together to take advantage of discounts

various duties among those guild members interested in tackling

in marketing, as well as products and services. “We have free

those particular aspects of guild business. For instance, a finance

legal counseling for people in the guild, as well as discounts

committee to monitor the finances of the guild, a legislative

on insurance,” says Parker. Thanks to the success of the guild,

committee to take the lead on reaching out to legislatures on

it was even able to hire a lobbyist, which according to Parker,

behalf of the guild, a membership committee to communicate

gives the guild “a lot of clout and power” before the state liquor

guild business with the members, and, perhaps, an agriculture

control board and legislature.

committee to work with local farmers to improve the quantity and quality of raw materials used to distill guild members’ spirits.

Now that your guild is up and running and has helped changed the laws in your state to improve business for all distillers, it’s

Membership dues and events are likely to be your sole source

time to share your achievements with the world. As Austin says,

of funds in the short term. For instance, the Washington guild

“even if you’ve done everything right and you are spending hours

hosts an annual showcase festival to assist in its fund raising.

and hours fighting for the industry, it does you no good if no one

The guild is also planning on inviting associate members to join,

knows you’re doing it.”

for instance, bottle suppliers, grain suppliers and other entities interested in supporting Washington distillers. New York has also been successful in obtaining state funds to support the guild and its endeavors. By forming a distillers guild, it was able to secure $500,000 to put towards marketing and tourism of

Ryan Malkin is principal attorney at Malkin Law, P.A., a law firm serving the alcohol beverage industry. He is also counsel for the American Craft Spirits Association and New York State Distillers Guild. For more information, visit www.malkinlawfirm.com or call (212) 600-5828. Nothing in this article is intended to be and should not be construed as specific legal advice.

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Y L R E T R A U Q D L I U G . S . U T R O P RE

e and grab th es to grow u n ti n o c stry ustry has tilling indu e. The ind lik a ia d he craft dis e and m ate guilds merous st onsumers u c n f o h g n o u ti ro n e th d atte ine decide nify its voic irit Magaz strides to u p t S a n re a g is n rt e tA . tak ons. We a it a podium al associati was to give e ic vo t e and nation a with th pport th ew series st way to su ducing a n o tr that the be in Union. re a uild in the goal we G t a te th ta r S e h h what’s To furt e of eac y can share tr ng the voic n ri u a o de insight c sh f e o efully provi round th a p o h m o singular aim fr so s g g guild e trend by doin er, distillin continue th world, and g to n e lli p ti o is h Each quart d ast we r of the the very le their corne dustry. At in e going on in vement. th f o e rest istilling mo d th ft to ra n c o e ti a th e for and inspir nified voic nd more u a r e g n ro of a st

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CALIFORNIA CALIFORNIA ARTISANAL DISTILLERS GUILD With over 50 current members and associate members, the California Artisanal Distillers Guild (CADG) has been busy in 2015. The CADG’s main remit is to help craft legislation that will ensure the growth and long-term health of craft distilleries in California. We also aim to enhance consumer awareness of local products and

craft distilling in general. California’s legislative environment for distilleries is lagging surprisingly far behind the privileges enjoyed by our colleagues in other states. Visitors to our tasting rooms are now able to taste our products for a fee (since AB 933 allowed this in 2014), but are then shocked to find out that this new, craft product they have discovered is not for sale from our distillery. This year, Assembly member Marc Levine introduced AB 1233 which would allow for limited direct to consumer sales on site. The

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effects of a legislative change like this would be huge for us. It would continue to enhance the three tier system (we do not want to selfdistribute), help market our products far and wide, support us economically, create more local jobs and finally allow that connection to

COLORADO COLORADO DISTILLERS GUILD The past six months have been pretty exciting in Colorado. Legislatively we have been working to preserve the laws that support distilling in Colorado while working to avert threats. We successfully supported the Distillery Pub bill, making a whole new class of distillery license available. We were also able to amend a bill from the Colorado Municipal League that sought more local oversight of tasting rooms, leaving the law for distilleries largely unchanged. The guild has also joined Keep Colorado Local to get ahead

INDIANA INFORMAL GROUP Indiana is relatively new to the craft distilling scene and currently does not host a formal guild. It was in 2013 that the Indiana Legislature first created a craft distilling license allowing direct retail sales to the public at small distilleries. There are currently 10 distilleries starting up or operating under Indiana’s new craft distilling license and 10 other DSPs in Indiana. We are now in the process of establishing a guild but most of our potential members have been focused on

MICHIGAN MICHIGAN CRAFT DISTILLERS ASSOCIATION The Michigan Craft Distillers Association has published its first directory and map, identifying 16 craft distillery members and three distillery in planning members (32

be made between ourselves as producers, and the fine people who passionately enjoy our spirits. We’re looking forward to this change. It was great to meet with such a large number of guilds at the ADI conference in Louisville back in April, many of whom

we have collaborated with since then. This momentum never ceases to amaze me.

of national chain stores in their effort to get voter approval for full strength beer, wine and spirit sales in grocery and convenience stores. We are also ramping up support efforts for FET reform at the national level. Locally we continue to build our relationship with the Colorado LED and help members that need support and information in the event of an enforcement action. On the fun side, in April we worked with Something Independent to put on Dstill in Denver, which is a weeklong celebration of craft spirits and their makers. There was a concert, three pop-up bars, a handful of panel discussions and the highlight of the week was the Dstill Showcase with around 50

distilleries and 1500 attendees. Over the next six months we will continue to look at legislative matters for the next session and help connect events, media, consumers and distilleries. Currently we represent approximately half of the 70 or so distilleries in the state, and by 2016 we would like that number reach 75% and continue to increase. We are looking forward to toasting a very busy and exciting year with some beautifully crafted Colorado spirits.

starting up their new distilleries. Absent an established guild, our informal group of start-ups has been working broadly to protect and improve the legislation that originally established craft distilling in Indiana, to level the regulatory playing field with our craft brewery and winery friends, and to secure fairer tax treatment. Our main priorities in the last legislative session were focused on making improvements to the current craft distilling license regime to allow for Sunday sales, satellite tasting rooms and removal of a 3-year wait period for new craft distilleries to come on-line. These measures

had some traction, but ultimately failed in a tumultuous legislative session. In more positive news we have a growing craft sector and events like the ACSA American Craft Spirits Association judging at Huber’s Starlight Distillery are helping to put Indiana on the craft distilling map. We intend to have our guild established before the end of 2015. And we look forward to updating you further as we establish our own guild and grow our businesses in Indiana.

unique locations) throughout the state. The publication is available free at member tasting rooms, Michigan Welcome Centers and at select chamber and visitor bureau offices. Ten-thousand copies were printed and the four-color tri-fold piece is also available in PDF format, online at MiCraftSpirits.com. Michigan’s first distilleries opened in the late 1800s, surviving the Prohibition years

before essentially dissolving during the midTwentieth Century. It’s only been in recent years that the industry has come back to life, with vim and vigor! Currently, Michigan ranks 3rd nationally for the number of craft distilleries. With nearly 40 statewide, the potential impact of this rapidlygrowing industry could contribute upwards of $400 million to the state’s economy.

Onwards!

Timo Marshall President, CADG Cat Herder, Spirit Works Distillery www.CADSP.org

Cheers, P.T. Wood Alchemist /President CDG pt@woodsdistillery.com (719) 239-0222

Rick Dietz Cardinal Spirits rick@cardinalspirits.com

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The craft spirits industry supports countless other industries in Michigan, as well. Many distilleries utilize locally-grown grains and fruits for their products, making them an important partner in the $102 billion agricultural industry. Public tasting rooms

MONTANA MONTANA DISTILLERS GUILD The Montana Distiller’s Guild (MDG) is an organization of distillers who are dedicated to coming together and providing a unified voice of support for the success and future health of the industry in Montana. We believe that the fast-growing distilling industry is a valueadded agriculture, manufacturing, exporting, and tourism economic driver in Montana. MDG was established in October of 2014, and is currently comprised of nine distilleries from across all of Montana with more potential membership 2015. There are currently 20 distiller’s licenses active in the state of Montana, with spirits ranging from vodka, gin, rum, whiskey, absinthe, liqueurs, and more. Guild members currently include Bozeman Spirits, Glacier Distilling, Headframe Spirits,

operating around the state make distilleries a part of the $22 billion Pure Michigan tourism industry – offering a quality visitor experience while also providing a growing number of jobs. The Michigan Craft Distillers Association was formed in 2014 to organize the growing

number of spirit producers in the state, to serve as a united voice on legislative, promotional and business levels.

Trailhead Spirits, Triple Divide Spirits, Whistling Andy’s, Willie’s Distillery, Wild Rye Distillery, and Dry Hill Distillery. The executive board is made up of a board of directors who are owners of operating distilleries, and are also active in committees dedicated to the focus of legislative support, marketing and promotional support, and overall guild management support.

of the product to consumers (previously limited to three) • MDG held a very successful legislative reception attended by a high number of lawmakers, key decision makers, and industry representatives • Identified two grants that will provide capital to launch MDG online and with hard marketing materials, securing our brand identity with forward-looking approaches to membership and services • MDG is set to meet in early June, and again in the fall of 2015. At each of these meetings, specialized trainings, Q & A sessions, and intensive planning will take place with key bureaucrats and industry partners — part of the many benefits of MDG membership. Our members will have access to information and opportunity to grow their businesses.

KEY POINTS FROM 2015

• In the first six months of formation, the MDG was successful in passing two key pieces of legislation that will help them make common sense business decisions in real time • Direct delivery of product to State Liquor Stores, with electronic delivery tracking • Increased the number of sales representatives that can promote the sale

Dianna Stampfler, CTA Dianna@PromoteMichigan.com (269) 330-4228 www.PromoteMichigan.com

RECENT DATA AND STATISTICS ON MONTANA’S DISTILLERY INDUSTRY Year

Employment

Establishments

Total Wages

Average Weekly Wage

Average Annual Pay

2011

10

4

$117,000

$231

$12,000

2012

26

6

$453,000

$330

$17,184

2013

66

8

$1,201,000

$353

$18,331

The data comes from the Quarterly Census of Employment and Wages that counts all payroll employment and wages based on unemployment insurance tax records. That translates to: the data is a count of jobs (not people, so one person could technically hold multiple jobs) and includes any job be it a full-time position or a five hour a week position. The only reason that is important is

NEW MEXICO NEW MEXICO DISTILLERS GUILD

so that you know the average wages might seem small because they include people working part-time. Prior to 2011 there was not enough data for it to be disclosed and maintain confidentiality. As far as taxes go, we can estimate payroll taxes based on average tax rates paid across the state. To estimate payroll taxes, FICA (Social Security and Medicare) and UI

(Unemployment Insurance) taxes, you can use this formula: (Total Wages) * (.0957). Gross Sales in Montana in 2014 from Liquor Sales were roughly $124 million.

The New Mexico Distillers Guild (NMDG) was formed at the start of 2015 by four founding DSPs: Santa Fe Spirits, Left Turn Distilling, Little Toad Creek Brewery and

Distillery and Algodones Distillery. Associate Members include Distillery 365, Krest Distillery and Bitter End Bitters. The initial board of directors consists of Colin Keegan

Cassandra Sunell Chief Marketing Officer | Headframe Spirits 406.299.2886 cassandra@headframespirits.com

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(Santa Fe Spirits), President; Brian Langwell (Left Turn Distilling), Vice President; and Greg McAllister (Algodones Distillery), Secretary/ Treasurer. Like most guilds NMDG was formed to protect and promote the distilling industry within the state of New Mexico and is open to all interested DSPs and associated startups and industry partners who share this philosophy and subscribe to the American Craft Spirits Association Code of Ethics. Additionally, NMDG sees as its mission educating the citizens of New Mexico about our budding industry and products as well as responsible consumption. Through something of a baptism by fire NMDG members effectively lobbied the NM Legislature during this year’s biannual 60 day session which ran from January through March. Members and their legislative supporters and lobbyists stood up in support of and testified on behalf of a significant

NEW YORK NEW YORK STATE DISTILLERS GUILD The New York State Distillers Guild has made remarkable progress in the two years since it was founded. Our major legislative achievements so far include expanded sales privileges for farm distillers, specifically sales by the glass on site and the ability to apply for an on premise sales license such as a bar or restaurant license, that we believe will open up immediate and significant new revenue opportunities for our distillers. We have also achieved event sales privileges for all permitted distillers in state, which allow bottle sales at tasting events such as our recent Good Spirits event in Brooklyn. Although this has not proved to be a major income generator so far, it helps offset the significant

OHIO OHIO DISTILLERS’ GUILD The Ohio Distillers’ Guild was formed in early 2013 to establish a common voice

bill which would have allowed for “retail reciprocity” across craft alcohol beverage categories. The bill passed both houses of the Legislature only to die an untimely death due to the Governor’s inaction before the signing deadline in what’s called a pocket veto. Under present NM law craft distillers can sample and sell their own products onpremise, or at up to two off-site licensed tasting rooms, as well as the products of other NM licensed craft distilleries. The same provision applies to NM licensed small breweries and winegrowers (wineries). The new law would have allowed any NM craft alcohol beverage producer to sample and sell the products of another NM producer regardless of category of licensure. The bill was touted as an economic development measure to help elevate the presence and quality of NM beverage alcohol products. A similar bill which allows for retail reciprocity between NM small breweries and

winegrowers (ostensibly so the brewers can sell hard cider, a winegrowers’ product) did pass both houses and was signed into law by the Governor. Future efforts of the NMDG will be to achieve parity with the brewers and winegrowers in this and other areas of state law. Other bills passed this session and signed into law with the support of the NMDG include provisions allowing for a 3rd off-site tasting room and alternating proprietorships allowing unused brewery, distillery and winery capacity to be leased to other licensees. The NMDG is a 501(c)(6) non-profit trade association and now represents five licensed NM craft distillers (out of a total number of six NM craft distiller licensees, or a total of seven when including another DSP holding a NM manufacturers license).

costs that often come with participation in a tasting event and provides opportunities to connect directly with your consumer in an actionable way. In the future, we are setting our sites on continuing to expand privileges for both A-1 and D licensed distillers and achieving parity with other beverage types in our state. The New York State Distillers Guild has also worked with the state to generate some exceptional marketing opportunities for our producers. TasteNY sponsored our participation in the Manhattan Cocktail Classic for two years running, and has sponsored numerous other tasting opportunities throughout the state. Through a NY state grant program, the guild is developing a consumer facing website that will showcase our member distilleries and encourage tourism. In the coming year we will

continue to work with TasteNY, Empire State Development, and Edible to generate sales and marketing opportunities for NY spirits. The board of the NYS Distillers Guild is proud of this tangible progress, but perhaps our most important accomplishment has been fostering communication, support, and collaboration among all of NY’s spirits producers. We truly believe that the rising tide raises all boats and are glad to work together to help everyone in the state be successful.

for the growing distilling community. Ohio being a three tier system, and completely state controlled, possesses challenges that are fundamental to distilling operations on a smaller scale. The guild created a streamlined voice to the Division of Liquor,

State Commerce and other participating parties. Beginning in the early 2000’s with just a single producer, Ohio’s craft segment has expanded to include nearly 28 listed DSPs, with more on the way. Over the past two and a half years, the guild

Dr. Greg McAllister (505) 301-9992 greg@algodonesdistillery.com

NEW YORK DISTILLERY NUMBERS Guild Members

Total State Distilleries

52

60-65 Nicole Austin Oak View Spirits Kings County Distillery New York State Distillers Guild American Craft Spirits Association

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THE FIRST (AND LAST) CALL FOR ALCOHOL.

mgpingredients.com/alcohol/

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has grown membership to include nearly 75% of the operating DSPs in the state. Our focus is threefold. To develop advocacy programs, create awareness and participation from our supporters in on/off premise locations and formulate legislature in a state that has historically been a very challenging control state for high proof alcohol (research Westerville, Ohio and Prohibition).

Currently the guild is working on a dual House and Senate bill to amend operations with the goal of creating parity with our brewing and vintning partners as well as leveling the field against other state craft systems. The highlights of those bills increases the proof gallon production limits and allows for the onsite “brewpub” model. Additional adjustments are in place to allow the micro

producers of the community to operate more freely through the state controlled system. For more information on the proposed legislature, please contact our guild lobbyist John Singleton at john@jsingletonassociates. com. We hope to have a positive update on these developments by the end of 2015. Ryan Lang Middle West Spirits, LLC

OREGON OREGON DISTILLERS GUILD Along with TOAST, our annual craft spirit event, Oregon Distillers Guild’s focus this year thus far has been on legislative initiatives to help in the promotion of Brand Oregon and improvements to our operations. OR HB 2568 is for the establishment of a spirits board funded by the state for the purpose of promoting the industry. This board will support the strategic expansion and availability of Oregon’s spirits through marketing initiatives and enable competitive advantage through industry education and research. In addition, it will assist in evolving

TEXAS TEXAS DISTILLED SPIRITS ASSOCIATION During the past 100 plus days, the Texas Distilled Spirits Association (TDSA) has been spending the majority of their efforts and time over at the Texas State Capitol in Austin for the 2015 84th Texas Legislative Session. The Texas Legislature, comprised of 150 House Representatives and 31 Senators, meets every odd numbered year, beginning in January, for 140 days. Therefore, these five months are the epitome of a “sprinted marathon” in the political arena in the Lone Star State. The 2015 Legislative Session marks just the second session for TDSA. Formed in 2012, Texas Distillers saw a need for a unified voice in the state legislature. As most who work in the

state laws and rules to enable distilleries to maximize revenue generation. OR HB 2567 makes several changes to how distilleries operate in the state improving our ability to showcase our products. Federal guidelines allow distilleries to sell bulk spirits via Transfer in Bond mechanism but current State law prohibits the sale of spirits to any other entity besides the State. A change to Oregon law to allow bulk spirit sales provides another avenue to reduce transportation cost for bulk spirit purchases from out of state and expand business practices of many distilleries. The bill also includes changes to some of our tasting laws. Currently, sample and full cocktails can only contain spirits produced by the distillery. By allowing other spirit to be used in sampling

at tasting rooms, Oregon distillers will have the capability to showcase their product in multi-spirit classic cocktails, which is how many consumers prefer to consume spirits. Other changes in the bill include Oregon specific event licensing changes and tasting room operations.

alcoholic beverage industry know, there are a lot of moving parts and many stakeholders to take into account and work with. Texas is a three-tiered state, with manufacturers, distributors and wholesalers, and package stores all having a significant interest in everything alcohol policy related that occurs at the Capitol during these 140 days. This legislative session, TDSA has focused primarily on education, outreach and advocating at the Capitol for our vastly growing industry here in Texas. To give you an idea of the growth, from 1997 to 2008, there were only eight distillers licenses issued in Texas. Today, there are over 70! During our first legislative session in 2013, TDSA focused on updating laws affecting the distilled spirits community that appeared neglected. This included adding provisions that now allow for Texas distillers to sell bottles of their spirits at their distilleries. The

members of TDSA recognize that continuous advocating for the industry is essential to long-term success for not just their business, but for the community as a whole in Texas. With the legislative session coming to a close on June 1st, TDSA has had a busy first half of the 2015 year. TDSA hosted their first ever “Texas Distiller Day at the Capitol,” visiting with legislators from across the state on issues affecting the distilling industry, and sharing the goals of the Association for the years to come. Back in February, TDSA also hosted the first ever “Texas on the Rocks” consumer tasting event here in Austin to help kick off the American Craft Distillers Association Annual Conference. TDSA may only be three years running, but we’re here for the long haul! Scott T. Stewart

OREGON DISTILLERY NUMBERS Guild Members

Total State Distilleries*

31

~59

*Based on spirit producing DSPs - meaning not a winery with a DSP

Ted Pappas Owner, Big Bottom Distilling, LLC President, Oregon Distillers Guild

Executive Director & Governmental Affairs Texas Distilled Spirits Association

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WASHINGTON WASHINGTON DISTILLERS GUILD The Washington Distillers Guild (WDG) has had a busy first two quarters, with new officers in place & the past board members remaining active & engaged. In May, our work to pass Initiative 5353 paid off. 5353 will go into effect on July 25th, 2015 allowing state distilleries to adulterate in-house made spirits; the ability to apply to showcase our spirits at Washington Farmers Markets; and finally, Washington distillers can now serve and sell spirits of our own production at private events held at our own distillery (wild, I know). It also allows distilleries to host their own private

marketing events too, for example, celebrate a rare release of a product or an annual celebration or anniversary. We are hoping the new changes will help promote the state distilling industry and provide our businesses a slight boost in direct sales. We are also eyeballs deep in producing our third annual PROOF festival—involving over 40 distilleries from around the state in a grand tasting, educational seminars & restaurant/ bar cocktail collaborations. This will take part on July 11th in Seattle. This is our number one fundraiser that has allowed us to pay for our lobbyist in our capitol. For more info, check out www.proofwashington.org. In addition, in January we began a monthly

newsletter, moved to quarterly member meetings (which has boosted our attendance tremendously) and are in the budding stages in building bridges with the Washington State Bartenders Guild. All in all, a pretty spectacular beginning of the year. WASHINGTON DISTILLERY NUMBERS Guild Members

Total State Distilleries

39

110

Holly Robinson Vice President, Washington Distillers Guild Owner, National Sales & Marketing Captive Spirits Distilling

Have news to share about your state’s guild? Contact Brian Christensen at brian@ artisanspiritmag.com or (509) 944-5919.

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IN-MASH MILLING PART ONE:

WRITTEN & PHOTOGRAPHED BY JOHN MCKEE

AN INVESTIGATION INTO MAKING DISTILLERY OPERATIONS SAFER

THE WHAT AND THE WHY:

THE QUESTION AND THE CHALLENGE:

From Recommended Fire Protection Practices for Distilled

Our questions became: Can we mill without the problem of

Beverage Facilities, 3rd Edition, Distilled Spirits Council of the

dust? Can we save money and lost COGS by not milling off site?

United States, June 2005 the Electrical Area Classification for

We knew from research and experience that in-mash milling is

Milling and Grain Handling Areas is Class II, Group G, Division 1.

common in brewery operations outside of North America, but

For those of you unaware, grain dust can form a potentially

could not find a specific instance of its use locally. Our thought was to mill the grain while it was in the mash water, in effect

explosive cloud. From OSHA...

“been over 500 explosions in grain

Over the last 35 years, there have

potentially be created. In order to in-mash mill, a very high-shear mixer or high-shear

handling facilities across the United States, which have killed more than 180 people and injured more than 675.

using the water to create a condition where less dust could

(www.osha.gov/SLTC/grainhandling) This means that grain milling and handling is about the most

pump is required. Basically, you need something that can literally shear the grain kernel apart while it is suspended in water or a water slurry.

DRY MILLING vs WET MILLING vs IN-MASH MILLING:

»»

via a hammer or roller mill the grain is either ground to a

potentially dangerous thing you can do in a distillery. Here at Headframe Spirits, we made a conscious effort from day one not to mill onsite. All grain was milled to a flour consistency offsite and shipped in 2000lb super-sacks to avoid some aspects of the dangerous conditions that grain and grain dust can cause for a distillery.

Dry milling is pretty self-explanatory: take dry grain and

»» »»

flour or simply cracked.

Wet Milling is a process primarily used by ethanol refineries to pre-process corn for production of ethanol.

In-mash milling is our term for using a high shear mixer to mill the grain, combined with water, in situ, in the mash tun.

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THE PRACTICAL AND THE ROI: ROI EXAMPLE:

Although we had made the decision to mill

PRE-MILLED GRAIN ORDER VS $18,000 HIGH SHEAR MIXER

off site, we were aware (as you should be, too) that off site milling has a waste component.

Bulk Grain (30,000 lbs @ $.35/lb)

$10,445

send to a milling facility will be lost in milling

Milling ($.06/lb)

$1,800

line turn-around from other products. A crude

Milling Loss @ 12%

3500 lbs

Cost of Goods Loss = Grain

$1235

Cost of Goods Loss = Milling

$213

Total COGS Loss

$1448

ROI vs. Total COGS Loss

~12.5 Pre-Milled Grain Orders

Generally about 10-15% of the raw grain you

ROI shows a pretty quick payoff when compared to the cost of a High Shear Mixer.

EQUIPMENT:

»» Mash tun = 1000 gal, steam and cooling water-jacketed, 80 rpm centrally mounted sweep mixer, with a 2” discharge.

30-40 gpm, VFD controlled, 30A 3ph

»» Shear Mixer = OEM, 3250 rpm,

LEARN MORE

»» Shear Pump = OEM, 3250 rpm, VIEW VIDEOS OF IN-MASH MILLING TESTS WWW.ARTISANSPIRITMAG.COM/IN-MASH-MILLING-VIDEOS

VFD controlled, 30A 3ph

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SHEAR PUMP EVALUATION:

SHEAR MIXER EVALUATION:

The shear pump worked well but had the following issues:

The shear mixer was installed in our mash tun by Headframe

1. If the slurry mixture was too dense, the flow to the slurry pump could be impeded. We found that we had to install a “booster pump” with a centrifugal tri-clover pump to ensure

Spirits Manufacturing and used to test various grains (shown in the table below). The mixer had the following benefits over the shear pump:

proper slurry flow to the shear pump.

1. All

milled in the same tank.

2. Utilizing the mash tun as our single use and return tank proved problematic and suggested that the slurry should be mixed upstream and pumped to the shear mixer for

2. Provided

3. The

shear pump didn’t provide for additional mass and

the sweep mixer was engaged during shearing

operations, the shear mixer was able to homogenize and

delivery to the mash tun, rather than recirculating the mash tun.

material could be mixed into initial slurry form and

reduce particle size uniformly.

3.

energy transfer during the mash-in operations.

Increased mass & energy transfer in the mash tun led to shorter mash times, some on the order of 50 percent faster.

4.

One negative of the shear mixer (resolved by

EQUIPMENT TEST

TYPE — RAW MATERIAL

Shear Mixer

Whole Peeled Potatoes

Shear Mixer

Whole washed, unpeeled potatoes

used from the beginning of the mash, a portion

Shear Mixer & Shear Pump

Whole Rye

of the kernels did not come into contact with the

Shear Mixer & Shear Pump

Whole Malted Barley

volume, allowing time for the shear mixer to contact

procedural and mash recipe changes) is that full water can’t be added to the mash tun first. We found that when the full mash water volume was

mixer. Adjusting our recipe to a smaller initial water each kernel, then adding the remainder of the mash water allowed for fully ground grain.

THE INITIAL RESULTS AND OUR “ASK” FOR PART TWO: Overall the tests performed as we expected. All raw materials tested thus far were adequately ground to a consistency between hammer mill and roller mill, suitable for both continuous and batch stills and also suitable for differing tray designs (in reference to continuous or top-fed stills only). As we proceed with testing, we’re asking the distilling community to present us with requests for further tests and information. What do you want to know — other grain types, changes to yield, costs, ROI vs Hammer Mills, changes to electrical classifications, etc.? Part two of this article will concentrate on answers to the questions that you ask. Reach out to john@headframespirits.com and brian@artisanspiritmag. com with your questions, thoughts, and insights. We’re always willing to help and share.

John McKee, along with his wife Courtney, are the owners of Headframe Spirits in Butte, MT. When not testing crazy ideas like in-mash milling, John is a professional builder of amazing blanket forts for his kids. For more information email john@headframespirits.com.

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Craft distilleries... you’ve got

our attention!

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American Craft Spirits Association

Committee Updates FR O M T H E B O A R D O F DIRE CTORS OF THE A M E RICA N CRAF T SPI RI T S ASSOCI AT I ON

LEGISLATION

ETHICS

Since the American Craft Spirits Association was formed we

The Ethics Committee has been working to balance the many

have heard our members loud and clear—Federal Excise Tax

interests of our members who wanted an Ethics Code to operate

reduction is their #1 legislative priority. The ACSA Legislative

as guiding principles and inspiration and aspiration.

Committee has been focusing on advancing this cause, and we

We believe that our members are self-selecting as the cream

have made significant progress. The formation of the partnership

of the crop, and already living their lives and conducting their

with DISCUS in support of the FET initiative is a historic step

business in this way, since it is the best way. Perhaps a bit naive,

towards industry unity, and was essential to moving these

but we seek the best in ourselves, and our fellow members.

changes forward. The work to shepherd these proposals into law

In light of this belief, we are working to arrive at a reporting

will be lengthy and challenging, and we are grateful to have the

mechanism which properly encourages legitimate reports, while

guidance of our new lobbyist, Jim Hyland of the Pennsylvania

not rewarding harassment for the investigators nor the targets.

Avenue Group.

Progress is always slow, and slower than desired, but progress

For now, we encourage all of our members to connect with

is moving. We always welcome members to join us on our

their legislators and educate them about yourselves and your

mission — the more hands helping, the better, and the more

industry. Your representatives on the ACSA Board of Directors

this becomes an industry movement.

will continue to work on the hill to craft legislative language.

PAUL HLETKO

ETHICS COMMITTEE CHAIRMAN

There is a wellspring of legislation supporting craft spirits producers sprouting for seemingly every direction. With this increased awareness and broad support, we are enthusiastic about the possibility for success in the near future!

ACSA LEGISLATIVE COMMITTEE The unity we show in support of sound tax policy will be welcomed on Capitol Hill where, all too often, partisan and industry infighting seem to dominate the discussion of important issues. We look forward now to doing the hard work necessary to advance the bill.

PETER CRESSY

PRESIDENT AND CEO, DISCUS

JUDGING This year’s Judging brought together some of the most influential people in the industry. As the only not-for-profit trade association representing craft spirits producers, our directives are to be transparent with our protocols and procedures, and to uphold the ACSA “Code of Ethics” in place for TTB labeling and product integrity.

TED HUBER

VICE PRESIDENT AND JUDGING COMMITTEE CO-CHAIR, ACSA

We applaud Congressman Young and Congressman Yarmuth for their support of the craft spirits industry and the introduction of HR 2520, the Distillery Innovation and Excise Tax Reform Act of 2015.

RALPH ERENZO

ACSA 2016 CRAFT SPIRITS JUDGING FEBRUARY 3RD & 4TH, 2016

CHAIR, ACSA LEGISLATIVE COMMITTEE

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operate in an honest, “ We transparent and non-deceptive fashion. We inform consumers truthfully and accurately about the sources and methods used to make our spirits through our labels, materials and communications. We expect fair dealing and respect amongst members. We obey all federal, state, and local laws.

CONVENTION Our convention will kick off with a town hall meeting, followed by interactive, round-table sessions covering the most important topics in our industry. Chicago was selected because of the partnerships with Visit Chicago and the Palmer House, our host hotel and venue, in providing a truly epic experience in terms of program content, expense and location! The Illinois Craft Distillers Association & the ACSA Convention Committee are committed to bringing the convention attendees an opportunity to promote their spirits in a consumer and industry based event that embraces the independent, innovative spirit of our industry.

LEAH HUTCHINSON

MARKETING & CONVENTION DIRECTOR, ACSA

ACSA’S 3RD ANNUAL DISTILLERS CONVENTION AND TRADE SHOW CHICAGO, IL. MARCH 2-4, 2016

— ACSA CODE OF ETHICS Visit www.americancraftspirits.org for more information on the American Craft Spirits Association and to join.

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Up co ming 5 - Day Rum Cour se: O c t . 5 - 9 2015, Kent uc k y, USA Arm Yourself with Rum Expertise and Propel your Rums to the Next Level! Successful rum brands star t with the end in mind. Our curriculum is d e s i g n e d t o t a ke y o u “ f r o m t h e g r a s s t o t h e g l a s s ! ” D a y 1: T h e B u s i n e s s o f R u m . W e w i l l g u i d e y o u t h r o u g h t h e e c o n o m i c a n d p o l i t i c a l l a n d s c a p e o f t h e i n d u s t r y, s o y o u u n d e r s t a n d y o u r c o m p e t i t o r s ’ a d v a n t a g e s a n d disadvantages. Day 2: The Classif ic at ions of Rum. We analy ze c ommercially available r ums to identif y their organoleptical characteristics and associated production costs. D a y 3 : T h e A r t o f R u m M a k i n g . Yo u w i l l s p e n d a n e n t i r e d a y e x p l o r i n g t h e d i s t i l l a t i o n of rum, understanding cuts and derived st yles, using laborator y and production stills. D a y 4 : H i s t o r y a n d S c i e n c e o f t h e B a r r e l . Yo u w i l l s p e n d a f u l l d a y e x p l o r i n g a n d u n d e r s t a n d i n g r u m ’s t r a n s f o r m a t i o n i n s i d e t h e b a r r e l . D a y 5 : E s s e n t i a l R u m L a b o r a t o r y a n d Te c h n i q u e s & I n t r o d u c t i o n t o R u m Blending. On the last day of the c ourse, you will devote time to understanding and using laborator y techniques, culminating in your blending of three dif ferent rums. N o t e: T h i s 5 - D a y R u m C o u r s e f u l f i l l s a l l t h e a c a d e m i c p r e - r e q u i s i t e s f o r o u r Advanced Rum Distillation and Advanced Rum Blending courses.

A few comments from our recent graduates: “ C h a n g e d h o w I m ove f o r w a r d , i n a g r e a t w ay.” ( T. C h a s e, S o u t h C a r o l i n a) “ E xc e l l e n t ! ” ( B . C a f f e r y, L o u i s i a n a) “ E xc e l l e n t ex p e r i e n c e . Wo u l d l i ke t o h ave t h i s t y p e o f t r a i n i n g f o r my d i s t i l l e r y p e r s o n n e l .” ( L . C o r d e r o, P u e r t o R i c o) “ I t w a s exc e l l e n t . I c o m m e n d y o u r g r o u p and team for this fine course. I ’m h o n o r e d t o h ave b e e n h e r e .” ( F. S t i p e s , P u e r t o R i c o)

R EG I S T R AT I O N O n l i n e a t w w w. m o o n s h i n e u n i ve r s i t y.c o m V i a Te l e p h o n e a t +1 5 0 2- 3 01- 812 6 U S D $ 5 , 4 9 5 . I t i n c l u d e s: • • • •

All class related materials Break fast, lunch and refreshments daily N e t w o r k i n g D i n n e r/ R e c e p t i o n Tr a n s p o r t a t i o n b e t w e e n T h e B r o w n H o t e l a n d M o o n s h i n e U n i ve r s i t y S p e c i a l: R e g i s t e r b e f o r e S e p t e m b e r 7t h a n d r e c e i ve 4 n i g h t s f r e e a t T h e B r o w n H o t e l !

“ C o n g r a t u l a t i o n s ! Ke e p u p t h e g r e a t w o r k . Tr e m e n d o u s l e a r n i n g ex p e r i e n c e (a n d h u m b l e). T h e c o u r s e b r o u g h t s o m u c h c o n f i d e n c e a b o u t t h e t o p i c .” ( F. L a Fr a n c o n i , N eva d a) “ Ve r y b e n e f i c i a l f o r m e .” ( D. B o u l l é, S eyc h e l l e s)


Our STORY

make community YOUR secret weapon WRITTEN BY COURTNEY MCKEE

o

wn a distillery? Congratulations, you’ve invested yourself localized packaging branding proved a great marketing tool. into a big damn marketing firm. While product quality, Hundreds of communities found themselves personally marketed

consistency, availability and price point are relevant factors in to by a large brand selling a localized message which motivated what gets picked up—by a distributor or an on or off premise them into buying a bottle or two to commemorate their place in customer—marketing plays an absolutely critical role in each step the world. It was a great move on Absolut’s part, as a Swedish leading to that final decision. From the fanciest, most exclusive company, to establish brand loyalty and a sense of community in brands, to the plastic handles of well vodka, deliberate marketing people all over the world. has gone into each brand and product. We’re not talking about

Recognizing that most microdistilleries don’t have an Absolut-

marketing gimmicks or tricks. Authenticity, integrity and social sized marketing budget, what tools do we have on hand to create responsibility are as valuable in today’s consumer’s purchasing relevance to today’s spirits consumer while distinguishing a decisions as price point and quality are.

company from the rest of the pack? How does a distiller build a

In the increasingly challenging field of differentiating brands, great story without breaking the bank on marketing costs? The every distillery has a distinct and unique opportunity to build answer is surprising, straightforward, creates more value than a something based on their own vision and values. When we high priced strategist, and it centers on the world right outside build a company or a brand or a product around that which your door: Community. moves us, we build authenticity into our company. Authenticity

Branding is the art of conveying a unique and compelling

inherently inspires attention, positive associations and loyalty, message to an audience. And in the increasingly congested and when authenticity is built around community, the value of spirits world, it can be difficult to find territory in which to that message is amplified. The companies doing this well are the distinguish a product. Many distilleries have the advantage of companies which recognize the value of marketing before even producing products using unique raw materials and non-standard filing a business license.

production methods. However, unless those methods are being

We saw it on a large scale with Absolut. Starting in the 1980s, communicated by the brand itself, these products will struggle they designed iconic ads based on cities around the world with the as much as any other brand. tagline “Absolut <<City Name>>.” By the mid-2000s, Absolut

There’s a great Montana success story in a company called Red

had tethered that original marketing concept to the US fondness Ants Pants, which makes work wear for women. Red Ants Pants for flavored vodka. Releasing a series of place-based vodkas, is a company devoted to empowering women in many different they’ve built product flavored and labeled after cities around the roles, and the founder of the company, Sarah Calhoun, was very US, creating a sense of connection to a community. Their highly clear on her vision for the company when she founded it—a vision

WWW.ARTISANSPIRITMAG.COM 33


which includes promoting and supporting “Made in the USA” vision and values. And nobody can tell Butte’s story better than manufacturing. She didn’t stop there. Her vision wasn’t just a Butte can. And why would anyone try? We corner the market on motto or company slogan. She took it much farther by launching our corner of the world. the Red Ants Pants Foundation to provide grants to organizations

That’s really the secret here. Each of us has the story of what

and events which support the message she’s nurturing. And if makes us unique. Tell an authentic story in an authentic manner that weren’t enough, she founded the Red Ants Pants Music and it will connect with an audience. Social media becomes your Festival, whose profits go to supporting the Foundation. And best friend and stories and images and hashtags are as easy as she’s done all of this from a tiny town in Montana called White looking outside your front door. Sulphur Springs.

Go bigger for a moment. What does a WIN look like for you?

Haven’t heard of it? Not surprising, considering the town has What is your vision for your business and what are your values? about 900 residents. The festival draws over 10,000 people in And I’m not asking just the bank account signers, I’m asking the summer to a cow field in White Sulphur Springs. Sarah began each of you who work at a distillery. What’s the message the with a vision and a set of values and has closely weighed each company promotes? What do you do, in turn, to support and of her business decisions against those core values. At $139.00 promote that message? Because our brand identity is tethered to a pair, Red Ants Pants aren’t inexpensive, but purchasing a pair each of us and is so much easier to communicate when it’s part of is making an investment—in a brand, in a message—and in a the fabric of our professional identities. So brand owners, tasting damn great pair of pants. It’s a buy-in to Sarah’s passion for her room employees, tour guides and distillers alike, I encourage you vision and values.

to ensure you’re clear on that message and that you understand

When we built our company concept, we had the name down your role in that marketing. very early in the process. The working title was Headframe

Bottle after bottle of clear spirits, brown spirits and flavored

Distillery, which morphed into Headframe Spirits. Headframes spirits collect dust on the shelves of liquor stores and dimly lit are the mining uprights dotting the hills above Butte, Montana. back bars across the US. That’s the hard truth and the tough Google “What is a Headframe,” they’re beautiful. They’re a love. The good news? It’s easier than it was 10 years ago when legacy in our landscape—a beautiful sight in an otherwise you were faced with questions from distributors like: “What is somewhat blighted scenery. We wanted our company story to be craft?” or, “What is a microdistillery?” Newer distilleries benefit wrapped around our place in the world. And it’s resonated—with from those who came before us, fought the good fight, and taught the folks who live here now, with those who grew up here or went us all that the little guys deserve shelf space next to the big guys. to college here and with those who’ve left and are looking for And for that, we raise a glass. And the better news? We each have the excuse to return home to live. And the best part? We don’t the ability to make a great impact on the microdistilling industry, have to pay a strategist to develop that story for us. We get to to do it without stepping on one another’s toes, while at the same unearth our story with our local museums and historians. We get time making great social returns with our efforts. to take the stories of our past and weave them into new stories

Courtney McKee is CEO of Headframe Spirits & Headframe Spirits Manufacturing. For more info visit www.headframespirits.com or call organizations who are founded on the same story, who share our (406) 299-2886. about our future. We get to do this in partnership with the other

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Local Louisiana Written by Steven Seim

S

ugarcane production is a crucial part of the economic

Photos Courtesy of Louisiana Spirits LLC

many hurdles, legal and otherwise. Like many, they had trouble

history of Louisiana. Bayou Rum, from Louisiana Spirits

with zoning, fire codes, TTB concerns, local utilities, besides

in Lacassine, hopes to honor that tradition by becoming a part of

actually planning on how to make the best distillery they could.

it. Taking locally sourced Louisiana sugar, the ownership team of

But positive conversations with local sugar producers and future

Trey Litel, Tim Litel and Skip Cortese produce an entire portfolio

fans helped maintain their enthusiasm, which still carries them

of rum products that they hope will come to be known as some

on today. Trey said that throughout the process they kept in

of the country’s finest. Trey took time to share the story of their

mind one saying: “Rum is the answer,” and that motto has taken

goal of preserving Louisiana’s sugarcane history through their

on a life of its own among their community and fans of this

rum, the people who helped them get started, and the advice he

historic product.

has for other distilleries.

Despite the impediments over 4,000 people visited the

Trey worked at Bacardi before deciding, with the help of Skip

distillery on its opening day November 16, 2013. Skip and Trey

and Tim, to start their own distillery. Louisiana Spirits is one of

gave 33 total tours to groups numbering 40 to 50 people each.

the first craft distilleries in Louisiana, which Trey told us meant

They offered sample cocktails, a BBQ dinner, local musicians,

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“Some will just produce and bottle and others will distill and bottle – it doesn’t matter that much. What matters is getting consumers’ attention to influence distribution partners to support you instead of only the international conglomerates.” — Trey Litel

and a rock wall for kids to climb. Since then, their visitor center

of advice and experience from others while building Louisiana

has been featured prominently in local media and continues to

Spirits. The American Distilling Institute helped put them

be instrumental in introducing people to Bayou Rum. Their 22-

in contact with several people and companies who help new

acre facility houses their distillery, visitor center, a 100-year-old

distilleries. Trey mentioned Luis Ayala, an expert on rum, who

farmhouse, a gift shop, and more. A gallery inside the visitor

helped inform them on rum production and history. Engineers

center shows Louisiana’s history of producing both sugarcane

from Vendome Copper Works and two companies helped to

and rum. Every bottle of Bayou Rum is made on premises. Their

finalize a proper distillation process flow. “Visits to other

base ingredients (molasses and raw sugar) are provided by M.A.

distilleries really helped us the most with visualizing our plan

Patout and Son, which is one of the oldest sugar manufacturers

and finding best practices,” Trey also said. The history of sugarcane in Louisiana is a driving force behind

in the United States dating back to 1829. Trey and his partners were able to make use of a great deal

the story of Louisiana Spirits. Trey gave us a truncated version,

Great tools.

Great beer.

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36 WWW.ARTISANSPIRITMAG.COM


starting with rum being produced by American colonists before

take more money and time than you think.” Without a large

the revolutionary war. Discovering how to crystallize sugar and

percentage of your budget set aside for marketing, he believes it

sell it led to a land rush along the Mississippi river. The boom

will be impossible for anyone to learn about your brand.

of sugar production led to Louisiana supplying 90% of the sugar

As for the industry as a whole, Trey said that there are enough

consumed in America by 1850. Sugar profits helped build New

consumers for everyone, especially with craft gaining a bigger

Orleans, which is commemorated by the Sugar Bowl being

share. He said, “Some will just produce and bottle and others

played in New Orleans every year.

will distill and bottle – it doesn’t matter that much. What

Bayou Rum currently comes in four varieties: Silver, Spiced,

matters is getting consumers’ attention to influence distribution

a Select that is aged in oak barrels, and a Satsuma rum liqueur.

partners to support you instead of only the international

Satsuma is a variety of orange that originated in Japan. It was

conglomerates.” There is also help in local organizations which

grown extensively all across the southeastern United States,

don’t deal with alcohol, such as local business support and area

including Louisiana. The flavor is described as sweeter than

economic development groups. A similar group took an interest

other oranges. Trey said his favorite way to drink their Satsuma

in helping Louisiana Spirits grow, and Trey said it “made a

Rum is chilled, straight up, which he described as “like biting

world of difference in our ability to persuade lawmakers to make

into a cold Satsuma orange.” For the immediate future they are

important changes to our local laws to enable us to operate as

staying focused on rum. Trey said, “the rum category is well-

we do today.”

established, large, and ripe for innovation.”

The spirits industry in Louisiana is already benefiting from the

Trey finished by sharing advice that he believes can help other

headway Trey and his partners have made with Bayou Rum. Their

craft distillers. He said that the most helpful advice he received

portfolio is enough to make their state proud. We are excited to

was to “build it bigger. If you don’t have a big enough footprint,

see where Louisiana Spirits goes next.

you won’t be able to produce enough to make it financially.” He also wanted to convey that the building and production part of distilling is the easy part: “The distribution and sales job will

Louisiana Spirits is located in Lacassine, LA. For more information, visit www.bayourum.com or call (337) 588-5800.

Spirit yeast is our world

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Our Safspirit product range offers the highest quality standard of dry spirit yeast strains for the finest and most original spirits

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g n i d n e l B irits p S hris Lozier written by C en y Christens Amanda Jo y b y h p a r g o phot


“Design your whiskey to be great, don’t just hope for greatness.” DAREK BELL OWNER OF CORSAIR DISTILLERY EXCERPTED FROM HIS SECOND BOOK, FIRE WATER

Blending is a combination of art and science. A well-blended spirit is something that will elevate your brand to the top shelf. If you want to produce the best spirit you are capable of, blending is one of the most powerful tools you have, something that will pay dividends in satisfied, loyal customers.

samples from the barrels they will consider for blending and

Overview

bottling. They arrange the spirits in a row, then start at opposite

“I often find that when people think about blending, at least

ends of the samples, nosing and making notes about each one,

in North America, they think of producing something of lesser

that way they arrive at each sample with different palates. They

quality, some watered down blended whiskey,” tells Nancy

eliminate the samples that are not ready, then they select about

Fraley, an internationally-renowned spirits consultant, taster and

seven barrels that best represent their house style.

blender. “But the way I like to think about it is that unless you’re

From those barrels, they use small samples to create different

going to release a single barrel product, you always have to find a

blends on a small scale. This is the first time they actually taste

way to put those barrels together in a way that’s going to create

the spirits. As they review each sample and blend, they ask what

the best product that you possibly can.”

they like and what is missing.

Blending spirits allows you to achieve consistency, develop

“Now I ask, ‘Alright, what does this need to be balanced?’”

your own unique house style, and create a product that is greater

explains Austin. “Because vanilla plus vanilla sometimes equals

than the sum of its parts. The myriad flavors in each of your

sweaty gym socks and you don’t necessarily understand what

barrels come together to form a spirit with great complexity and

happened, so you can be surprised sometimes by what’s actually

quality, like teamwork in a bottle.

in the blend. If it’s really oak forward, maybe it needs some

“Consider your casks as a group of individuals,” explains

complexity, some lightness to balance that out.”

Nicole Austin, Master Blender at Kings County Distillery in New

Having the written tasting notes, they are able to quickly

York City. “Make that mental shift: these are not all the same.”

identify the barrels that will balance the blend. After they choose

Austin says there are a lot of blending methodologies out there,

the final blend, they harvest the barrels, pour them in a stainless

but you will have to find the one

steel tank, add water until it reaches 90

that works best for you and

proof and bottle it. They add the water

your house style.

over several days to gradually reduce

“You know your product better than anybody, so you should know best which barrels best represent the best product you are capable of making and the one that you most intend and desire to make,” she tells. At

Kings

County,

Austin

and

Cooperage Manager Ryan Ciutcha pull

“Consider your casks as a group of individuals. Make that mental shift: these are not all the same.” NICOLE AUSTIN MASTER BLENDER KINGS COUNTY DISTILLERY

the ABV, but once it reaches 90 proof they bottle it immediately to prevent any further changes. Austin says that spending four hours perusing barrels feels more like a luxury than a necessity, but she doesn’t think that’s actually

WWW.ARTISANSPIRITMAG.COM 39


the case. “My product would not even be half as good if I didn’t,” she tells. “In any given blend I might have a 14 month old barrel, a 12

“As a small distiller, when you don’t have much stock, you may not be able to create perfect flavor consistency, but you want to have consistency of quality.”

month old barrel, an 18 month old barrel and a 20 month old

NANCY FRALEY SPIRITS CONSULTANT, TASTER AND BLENDER

barrel sizes. Many distillers start their aging program with small barrels, and while Fraley advises her clients to use 53 gallon barrels, she says she understands the economics of why distillers sometimes opt for small barrels.

barrel. If I had just pulled those

Fraley

always

suggests transitioning to a

all at one moment, if I had just picked one age and pulled those it wouldn’t work. You have to

53 gallon program, but says the small barrels can be useful as

spend the time and effort.”

blending tools.

Creating Complexity Fraley says distillers can create complexity with a variety of blending techniques. Like Austin, she recommends combining different ages of spirits, using barrels from different warehouse locations, barrels with different char levels and even different

Fraley says that whether you have small barrels or large, many barrels or few, your blending concerns are still the same: consistent quality. “As a small distiller, when you don’t have much stock, you may not be able to create perfect flavor consistency, but you want to have consistency of quality,” she explains. “You want a consumer

40 WWW.ARTISANSPIRITMAG.COM


to realize that you have a recognizable house style.” Since most small distillers don’t have a lot of mature stock to bottle, by carefully blending younger spirits they can create a new spirit with complexity that surpasses that youth. When it comes to blending, age matters, but it’s not the whole story. “There’s this obsession with age,” tells Nicole Austin. “Going into it, I felt like that was the only thing that mattered: if you found the right age you will have nailed it. I had no idea how much barrel to barrel variation there might be.” Across the country in Joseph, Oregon, Stein Distillery’s blended whiskey was selected as the best American blended whiskey at the 2014 World Whiskies Awards. Competing against products up to seven years old, Stein’s whiskey was only two years, proving that thoughtful blending can create complexity beyond the spirit’s age. “We probably took a month making different blends,” explains co-owner Austin Stein, who says that winning the award really boosted sales. “You add a lot more flavor profiles in your blend by combining different grains,” explains Stein’s father, Dan. “Blends typically tend to be smoother than straight whiskeys, but it’s got nothing to do with making it smoother. By blending barley, which is a real mild grain, with corn or rye, you can get a lot more flavors going on.”

Timing and Methods The age of your spirit is not the only timing you need

blending: knowing how to capture the right moment.

to consider when harvesting barrels. You should also expect the

When you are ready to harvest those barrels and create a

barrels to go through cycles of oxidation, so sometimes mature

blend, you need to be aware that as you add water to bring it to

barrels need to be left alone for several months before they are

bottling proof, there is a danger of saponification, which means

ready for harvest.

the spirit can turn soapy. If this happens, there is no way to

“Your spirit will go through a lot of stages,” explains Fraley.

reverse it. The spirit is ruined.

“The first year is going to be mostly about extraction — wood

“With higher quality products I want to go very slowly over

sugars, solids, tannins, lactones, fat from the oak and such.

time,” tells Fraley of her proofing methods. “Once I’ve watered

The first year you’re going to see a big loss. And then you’ll see

it, I put it back in the barrels again, let it sit there, determine

a period where you taste your spirit and it’s just now starting to

how long I want to do this program. It can be up to a year. Then

show all of those elements. And then it will go into and out of

from the same barrels I lower it again.”

oxidation periods. You’ll taste your spirit and you’ll think this

Some brandy blenders take up to five years to proof their

was a mistake, six months ago it was so good. Taste it again in

spirits, adding water gradually and letting the spirit rest and

another six months or a year and it has completely come out of

recover after each proofing. Double distilled, high congener

that cycle, and it’s great.” Fraley says that’s part of the art of

spirits like pot-distilled whiskeys, brandies and rums contain

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more fatty acids, and when they approach the critical point of 46 percent ABV, saponification becomes a real threat. Gradual, slow

“If you want it done and you want it done right, you call Joseph & Joseph.”

reduction is the only way to avoid it.

CORKY TAYLOR, CHAIRMAN/4TH GENERATION,

they are dumped, proofed and bottled in a very short period of

KENTUCKY PEERLESS DISTILLING COMPANY

time. While the danger of saponification still exists, most of

However, the majority of bourbon blenders use a quick and simple blending method Fraley calls a one-time barrel dump. Just like it sounds, once the barrels to be harvested are selected,

the large bourbon distillers use column stills which leave fewer congeners in the spirit, and thus less risk of ruining the spirit.

The Blending Triangle “You can break aroma down into some very basic parts,” tells Fraley. “Fruity/estery, floral, herbaceous/vegetal, spice, wood, nutty, sweet and smoke.” Identify those flavors in your spirits first, then choose how you want to assemble them. This is the part where you actually build the spirit you want to put your name on, and it’s helpful to use a system called the blending triangle. “Blenders all over the world, whether they’re making perfume, coffee blends, tobacco, alcohol, you name it, they tend to follow this traditional blending system,” Fraley explains. “You can think of it as a triangle. Base components make up the general character profile, roughly 50 to 80 percent. Then the supporting components make up the things that the base components don’t have. They kind of fill in the blanks. This is 10 to 30 percent. Then you add the nuance components, which make up 0.5 to 8 percent.” Fraley says these nuanced components can come from a barrel that has a really unique flavor that is good, but not necessarily something you would use for a single barrel bottling. Adding this

Designing distilleries for more than a century. Coast to Coast. Expertise from craft distilleries in urban and rural locations to master plans and designs for major spirits companies.

barrel, whole or in part, depending on the size of your blend, will make the spirit pop without overwhelming the blend. Taking advantage of the individual aromatics that your mature spirits have to offer, you can create something unique and memorable. If you are thoughtful about your blending, using it as a tool, your customers will notice and come back for another bottle. A consistent quality house style equates to consistent customers.

Nicole Austin is Master Blender at Kings County Distillery and consultant with Oak View Spirits. Visit www.oakviewspirits.com for more information.

502-583-8888 | info@josephandjoseph.net | josephandjoseph.net

Nancy Fraley is an International Consultant, Whiskey & Rum Blender, and Professional “Nose” at Nosing Services. For more info email nancylfraley@yahoo.com or call (510) 316-6879.

42 WWW.ARTISANSPIRITMAG.COM


DISTRIBUTION ELOCUTION WRITTEN BY STEVEN SEIM

In February at the annual ACSA conference there were several panels meant to highlight helpful information for distilleries on dealing with distribution. Artisan Spirit was there to sift through it all and report some of the most important advice. This article is meant to guide and prepare you for meeting with and deciding on the right distributor which can help you grow at the pace you desire, and to help you make the most of a partnership which should benefit you both.

FIND YOUR MATCH One of the big questions on the table is: “Which distributor do

want to drink local, even sometimes unconsciously, and even

we work with?” In order to get the scoop on who works best with

if a product is actually lesser quality. Distributors may look to

retailers and restaurants, distilleries should talk to them directly.

see if you’ve made headway in the easier home market before

If you hear several retailers mention the same distributor, they’re

deciding on a partnership. Moreover, distilleries should know

probably worth approaching. Especially locally, finding out who

that a successful home turf sales strategy may be harder to

is good at getting their stuff on shelves and who everyone likes

execute in other cities. When showing a distributor plans for

working with will give you a leg up.

growing in other markets, make sure you’ve factored in more

When communicating with potential distributors, make sure you have a marketing plan ready. Presenting your goals,

than what worked locally. Perhaps most important is making sure you get along with the

strategies, and production plans will help any distributor give

people who will be distributing your product. Most successful

you accurate information about how they can help achieve those

distilleries have recognized that they are in the relationship

goals. Inventory forecasting is also important for the distributor

business. If your contacts aren’t people you are friendly with, a

to know that they won’t get stuck with too much product, or not

successful partnership will be harder. Sales reps and managers

enough. One panelist said it is helpful for a distillery to plan

that like you might push your brand more. Think of it like

months in advance when interviewing distributors (like getting

this: you are struggling for mindshare with the employees of

your UPC code certified). Understanding retail tiers, product

a distributor just like you are struggling for mindshare in the

positioning and your expected pricing will make conversations

consumer market.

easier. Finally, your knowledge of local laws is crucial. Knowing what distributors are allowed to do for you can ensure them that working with your distillery won’t be a waste of their time.

WORK ON YOUR RELATIONSHIP

One of the biggest advantages a distillery has is selling in their

A productive ongoing relationship with your chosen distributor

home city. It was repeated across most panels that consumers

will help grow both businesses. So what did the representatives

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of various distributors say a distillery can do to help everyone

it won’t happen out of nowhere.

succeed? Don’t rely on the distributor to do all of the work for

A distillery should have clear growth plans in place. What are

you. The distillery must continue to help increase the mindshare

your plans for spreading out in the city you started? How about

of its brand. Continue to talk in person to potential retailers and

for the next city over? Or the surrounding states? One panelist

bartenders. Increase your fan base and encourage people to ask

suggested trying out a sales plan in one market at a time; if it

for your products where they’re not available yet. If people are

works in one city, chances are it will work in others. But if there

asking for your products, that word will get to distributors.

are problems, changes can be made without too much time

Since every distributor serves many distilleries, your time with

and money lost. Some distributors have large graphic design

them is precious. Making the most of brief meetings and email

and marketing departments, and some only have one person

communications will make their job easier when they’re trying

who can help you with very small projects. Understand what

to give your products space on the shelf. Be concise and don’t

the distributor you’re working with is capable of and make sure

waste time with small talk. Remember that it’s ok if you only

you’re prepared for that.

get a small part of your distributor’s attention to start. Every

If a certain sales rep is performing particularly well for you, feel

distillery starts small, and it makes sense to be a minor focus for

free to reward them. Most speakers agreed that filling someone’s

a distributor that probably has bigger accounts. Don’t begrudge

gas tank was a good way to show your appreciation. The panelists

it. They are still on your side. Growth comes with time. Do not

also warned against singling someone out and praising them

stress over the size of orders because any order is valuable.

in front of a group or meeting, which can sometimes have a

The dynamic change from you desiring more of a distributor’s

negative effect for the rest of the group. Connect with any rep

resources to them wanting your attention can come in time, but

you want to praise personally.

RIDE ALONG A unique opportunity certain distributors will make time for is a ride-along. This is a chance for someone from a distillery to spend a day riding with a sales rep from account to account. A chance to meet potential sellers of your product shouldn’t be passed up, and it can be invaluable to learn your distributor’s attitude and tone when talking about products. Here are several tips to make the most of this special opportunity:

1. SPEAK TO THE REP BEFOREHAND AND

MAKE A PLAN. Prepare goals and expectations. Don’t be a passenger in the planning phase, help drive how the day will go.

2. Most reps work different areas. INQUIRE ABOUT THEIR TERRITORY. Their advice can help open

other avenues for your distillery to improve market share.

THE SCHEDULE. A rep plans an entire 3. dayFOLLOW of visits with accounts; staying late at one makes you late to everywhere else. This is especially true when relying on public transportation schedules. Don’t jeopardize their business or relationships by keeping them from seeing their customers.

LUNCH QUICK. Time is everything to a 4. repMAKE with appointments to keep, so don’t pick an expensive restaurant that encourages taking your time. Find a sandwich shop on the way and take 15 minutes to regroup.

ON THE REP FOR WHAT WORKS. 5. AskRELY them how to approach a conversation before you get to a destination. They know their accounts, and they know what tone or style of conversation will be most effective.

MAKE SURE THE DAY ENDS POSITIVELY. 6. Both of your moods at the end of a ride-along will determine how the rep remembers you, and how they convey the success of the day to their boss. If you spend the last three accounts checking your watch and stop paying attention, that rep isn’t going to want to sell your stuff the next day when you’re not there. Your goal should be for the rep to end the day wondering when they will get to work with you again. That positivity will spread to your distributor through conversations with their co-workers.

FOLLOW UP PERSONALLY WITH ACCOUNTS. 7. Send them a handwritten note or card. They will remember you.

Attending a ride along can get your distillery lots of personal attention from those who actually sell your products to consumers. If you’re given a chance for one, use these tips to make the most of it.

44 WWW.ARTISANSPIRITMAG.COM


GENERAL SALES MEETING One key aspect of working with a distributor is the opportunity to attend a General Sales Meeting. Over several hours, many suppliers (that’s you) get 10 or 15 minutes to make a presentation to a gathering of the distributors’ sales teams. However, remember that they are likely listening to an entire day of speakers and you’re only 15 minutes of that time. Focus on the things that will help your brand stick out. First of all, check with their tech department before the meeting and make sure your presentation will work. Don’t lose precious time troubleshooting technology. When speaking, don’t fill time with small details. Stick with the main points and major announcements. Tell them about your new product that is launching soon or an overall marketing program. Handing out sales sheets or other prepared documents with these points can help salespeople remember. Offering a tasting is important since what’s in the bottle is vital, but always do it straight instead of in a cocktail. One thing many distributors agree on

O The CF-1000 is run by a central PLC and operated via a local touch screen panel. O Recipes can be programmed into the system to automate the production your primary product lines. O Real-time trending of temperature, levels, and pressures allow the operator to make specific changes as needed. O The system automatically logs all pertinent run information, such as levels and temperature. O Each skid is attached to a remote support system allowing for troubleshooting, training, and guidance from Headframe Spirits O Manufacturing headquarters in Butte, Montana

is to stay on topic: your brand. Do not speak poorly of another brand or disparage another company. You never know if the distributor sells their product or might one day, and it can put your brand in a negative light. Once you tell your story to a sales rep, that rep needs to be able to replicate it to an account, and that account should want to repeat it to a customer who picks up your bottle off the shelf. Sales reps want to match the right brands to the best accounts, and knowing key parts of your marketing helps them put your products where they will sell best. Besides speaking directly to a sales team, there are other opportunities when you visit a distributor for a GSM. Some distributors have teams dedicated specifically to craft, and you can personally introduce yourself to those team leads or managers. Managers can also give you tips on how to better connect with the group so that your message is received more

The CF-1000 is a single pass solution for producing spirits up to 95% ABV. The CF-1000 recovers 25% more alcohol, requires 50% less time and recovers 3 times more alcohol per hour than a traditional pot still. With a standard height of 18 feet, the CF-1000 can be further customized to fit almost any location. And with the standard 6-month lead time, the CF-1000 will be ready when you are.

successfully. When your time is up at a GSM, it doesn’t have to be the end of your time with them. Let them know you are reachable and leave contact info, or let them know who in your distillery is a good contact.

A distributor should be an extension to your business, not an adversary. If your brand grows, so does their bottom line. Use these suggestions to help make sure you’re both looking forward, together, in the same direction. You will both be better for it.

Headframe Stills Manufacturing Inc. 200 Technology Way Butte, Montana 59701 406-290-9446 Stills@headframespirits.com

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Better Warehousing FOR Better Spirits Written by Chris Lozier

O

///

Photography by Amanda Joy Christensen

ne of your most important tools is your barrel aging warehouse. Whether your

distillery has grown large enough to build a separate storage

Temperature, Humidity and Microclimates While your warehouse is a macroclimate that

space for barrels, or they share the floor with your still, that

you can largely control, it also features microclimates

storage environment is just as important, if not more so, than

which you can use to your advantage, as well. The same spirit

the time the spirit spends in those barrels. The more control you

laid in the same barrels for the same time will have a totally

have over your barrel storage space, the more you are able to

different flavor whether you store it near the floor or the ceiling,

control the maturation of the spirits inside.

or the north or the south side of the space. In addition, the

“The maturation phase contributes an awful lot to your aromatics,” explains Nancy Fraley, a world-renowned spirits

construction materials used in your warehouse will also have an impact on your spirits.

consultant, taster and blender. “Yeast contributes about

For instance, barrels taken from the north side of a warehouse

10 percent to the aromatics, distillation about 15 percent,

often have an earthy, musty flavor, while barrels from the south

fermentation, grains, your process, about 25 percent, and

side are called “honey” barrels because they were warmer from

if you’re going to be laying down your product for long term

the sun’s heat on the south side of the building.

maturation, 50-70 percent of your aromatics come from that.” That is why it is so important to control what happens in your warehousing space. Don’t leave it up to chance. The best way to understand how to utilize your warehouse is

The warmer the barrel’s storage environment, the more the spirit interacts with the wood and extracts from it. The maturation process is faster, and the spirit develops spicier, bolder aromatics.

to understand that there are three major components to spirit

The spirit will also mature faster if the barrel environment

maturation: temperature, humidity and ventilation. Control

undergoes diurnal and seasonal variation, as well. These

these three elements and you can better plan the maturation

maturation cycles are also believed to produce a more complex

process and produce better quality spirits.

spirit.

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“If you want to have a fast maturing

potentially break and spill the barrel. In

product, you need to have a difference in

moist environments, barrels can take on

temperature, day and night, summer and

too much water.

winter,” explains Julia Nourney, a well-

Nourney shared a story from one of her

respected authority on spirits maturation,

clients that stored their spirits in caves

blending and tasting in Europe and abroad.

with lower temperatures and very high

Temperature cycles and heat extremes

humidity.

have their limits, however. Maturation

“They filled the barrels normally, but

stagnates at 45 degrees Fahrenheit, so a

because the water molecules are so

barrel that stays too cold too long is no

small, the liquid in the barrel increased,”

longer maturing. On the opposite end, if

she tells. “It was a natural dilution of

the temperature is too high, the spirit will

the whiskey in the barrel, but the liquid

extract too many tannins from the wood,

became more and more and more, and

and much more spirit will be lost to angel’s

the barrel broke because the pressure

share evaporation.

inside the barrel became far too great. We

Distillers and blenders can use these

realized when we took samples that when

unique microclimates to their advantage.

we tried to get the bung out of the barrel,

As an example, blending a spicy barrel

it immediately exploded.”

from the hottest section of the warehouse with an earthy barrel from the bottom row on the colder side of the warehouse can help to produce a consistent, complex, and interesting spirit. Humidity plays a large role in the spirit’s maturation, as well, often working hand in

Ventilation and Design When you plan your warehousing space, both temperature and humidity control are important, but you should also design the space with good ventilation.

hand with temperature. The lower levels

First of all, ventilation is important for

of barrel storage tend to produce subtler,

safety concerns, as evaporating spirit can

earthy flavors not only because they are

cause the ambient ethanol to raise to

cooler than the top levels, but the humidity

dangerous levels.

is also higher near the bottom of the racks, as well. Both Fraley and Nourney prefer 70-80 percent humidity. “If the humidity is too low, and I mean

Ventilation is also important to barrel and spirit health, as well. Musty barrels produce musty spirits, and mold and mildew are a couple signs that you need to improve the ventilation.

below 40 or 50 percent, you’re going to

Conversely, too much ventilation can

have a very aggressive, dry spirit,” explains

increase evaporation, so aggressive forced

Fraley. “If the humidity is too high, the

air systems are generally not needed or

spirit just loses structure and becomes

desired. As with temperature and humidity,

‘flabby’. It’s like drinking brown water.

it is important to try to find a balance.

That’s why humidity is so important.”

“If you find a dry ventilated warehouse,

Environments with excessively high or

you will have a reduced concentration of

low humidity can pose barrel structure

alcohol and water around the barrel, plus

problems, as well. In arid environments,

you’re going to get increased evaporation

barrel staves can crack and leak, and

of both water and ethanol,” Fraley explains.

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47


“A little evaporation is fine, but certainly you don’t want really high losses if you can avoid it. But you also don’t want to create

recommends racking systems that don’t stuff the barrels too tightly together.

a situation where you’re racking your barrels really close together and your warehouse gets really hot and humid. It gets kind of

Maintenance

stagnant, and the liquid inside can start getting a little musty.” Fraley recommends opening doors and windows in the summer

No matter what warehousing space you have to work with, the

if possible to encourage gentle ventilation, especially in warmer

maintenance practices are generally the same, and always very

climates. Even though your evaporative losses will increase, she

important.

says some loss is actually good for barrel health.

Whatever aromatics occur in the warehouse have the chance

One place small distillers often get into trouble is storing

to make it into the maturing spirit. One of the biggest problems

their barrels on end on pallets. While the pallet system is

is stagnant water. While water may be necessary to increase the

convenient for rotating and moving barrels with a forklift, the

humidity in the warehouse, Fraley suggests wetting the floor and

barrels tend to get crammed together too closely and ventilation

them brooming the water evenly across the floor so the air can

suffers, resulting in poorly oxygenated spirits. If possible, she

absorb the moisture without becoming musty and stagnant.

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Keep chemicals away from the barrels, as well, and if possible, separate your production room – fermentation tanks, stills, etc. – from your barrel storage room. Transfer hoses should also be drained as soon as you are finished using them. Fraley recommends rinsing the hoses with clean water, walking them so they drain (preferably twice), and then hanging them to dry. She says it is also extremely important to have different hoses for each task. “Use dedicated hoses,” she shares. “You never want a spirit to go into a hose that’s been used for wash or low wines. You

from borers and other insects. While much of the maturation stage is out of your control, like barrel wood sugars, stave seasoning, etc., if you take control of the elements you are able to, like temperature, humidity and ventilation, you can maximize the quality of your spirits. Fraley says the best way to think about your warehousing is to borrow the French term for spirits maturation: elevage. “It’s everything that you do from the time that spirit is born to its maturation,” she shares. “It literally means educating or raising the spirit just like you would your own child.”

always want to keep those things separate.” One maintenance practice that seems counterintuitive, however, is pest control. Fraley says you want to keep spiders and their webs, because they will help to protect your barrels

DISTILLING EQUIPMENT AND SUPPLIES Family Owned & Operated Craftsmanship Is Second To None

Nancy Fraley is an International Consultant, Whiskey & Rum Blender, and Professional “Nose” at Nosing Services. For more info email nancylfraley@yahoo.com or call (510) 316-6879.

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S AV E

E H T

E N SW SHI EET I WR

TT

E

Y NB

CH

“We’ve been recognized by the state for rural innovation,

best

marketing

campaign,

and cool, fun things to do in WV,” tells Losey. “So

they

support

absolutely

us

in

that

regard. But the Alcohol Control

Board

is

making it very difficult for us to thrive.”

O ZIE R RIS L

On February 10, Bloomery

closed

their doors, laying off

17

employees.

The problem was not the business:

they boasted excellent sales, their products were

successful and they were a vibrant tourist destination. The problem, Losey says, is WV’s tax and fee structure, which after three years of strong sales left no profits for the distillery. The story starts in 2000 when WV elected to retain state

THIS IS HOW FAST THINGS CHANGE IN OUR INDUSTRY:

control of distribution but privatize liquor sales. Liquor

This article was written in March. When we reviewed it in April for publication in this issue, a new bill had already been passed to improve the business climate for West Virginia distilleries. Congratulations for writing and passing the bill, Bloomery Plantation Distillery, but could you at least let us get this baby printed before you change any more laws? Jokes aside, here’s a then-and-now look at Bloomery’s battle, leading with the original article and appended with the new lay of the land for West Virginia distillers…until Bloomery changes something else.

store applicants now enter a sealed bid to the West Virginia

B

Alcohol Beverage Control Administration, WVABCA, every 10 years to not only receive their license, but prevent any other liquor stores from operating in their local region, or market zone. Several liquor stores can sell within the same market zone, but the number is limited. Now enter distilleries. “When the first distillery wanted to sell out of their tasting room, the WVABCA allowed them to do that as long as they

loomery Plantation Distillery of Charles Town,

were treated exactly like every other WV retail liquor outlet,”

West Virginia attracted 50,000 visitors in just

explains John Foster, VP and Director of Sales at Smooth

three years. Co-owners Tom Kiefer and Linda Losey

Ambler Spirits in Maxwelton, WV. “That was to ensure that

planted lemon trees, Hawaiian ginger, berry bushes

a distillery couldn’t steal the hustle of their neighborhood

and other ingredients on property which was

liquor store.”

originally developed as an iron foundry, or bloomery,

As any established distiller knows, undercutting liquor

in 1754. A log cabin built in 1840 was renovated

stores is a nearsighted strategy, since they are your partners,

to house the distillery and tasting room, and that’s

not your competitors. With or without state regulation, it

where they transform those ingredients into their

most likely would not have been an issue.

Sweetshine. An economic boon for the area, attracting tourism dollars from the Washington D.C. metro area and beyond, the state of WV congratulated Bloomery for their vision and success.

“We don’t want to undercut our liquor store partners,” tells Losey. “We need them. They don’t need us to succeed but we certainly need them to succeed.” But that argument was not heard, and the state required both retail liquor stores and distillery tasting rooms to enter

50 WWW.ARTISANSPIRITMAG.COM


the bailment system and do two things. First, pay a 28 percent markup fee to the state, and second, add a 10 percent retail markup to make sure the market is competitive. Losey questions why distillery tasting rooms, which can only sell products made on-site, are taxed the same as liquor stores that sell many more products and don’t have the added overhead that distilleries do. “We’re a small farm distillery,” explains Losey. “It’s expensive to provide that experience. Plus we’re required to grow a certain amount of our raw agricultural ingredients and that’s another big expense.” Add to that the fees Bloomery pays in the bailment system and a WVABCA handling fee of $3.10 per six-bottle case (which only Bloomery employees actually handle), and the business model becomes unsustainable. “We don’t want to be treated like a retail liquor store when indeed we are not,” says Losey. “We are ag, we are tourism, we are a distillery. We can’t sell gin, vodka and everything else that they can make their money on. We can simply sell our small 375ml bottles.”

THE MARKET ZONE TAX WV distilleries face another hobbling fee that Losey says you won’t find anywhere else in the nation: the market zone tax. Every month, WV distilleries calculate their tasting room sales and cut a check for 10 percent of that amount to the WVABCA. The state then distributes that money equally to the retail liquor stores in that market zone, but the liquor stores do not pay anything back to the distilleries. “There is nobody else in the country that has to give up 10 percent of their retail sales to liquor stores,” says Losey. “It’s just crazy.” The market zone tax is basically protectionism for liquor stores. It is purportedly an attempt to rectify the lost sales that the small distilleries are stealing from them. In the worst case scenario, if a distillery tasting room sold $50,000 in one month, they would pay the state $5,000. If the liquor stores in their market zone sold less than $5,000 of that distillery’s product, the distillery is actually paying the liquor stores to buy competitive brands like Bacardi and Grey Goose.

NOT THE SAME THING “We’re a tourist destination and a manufacturing facility and they’re a liquor store,” says Foster of Smooth Ambler. “People are coming here because they want to see the place and do a tour and do a tasting and then leave here with a bottle. People

“WE DON’T WANT TO BE TREATED LIKE A RETAIL LIQUOR STORE WHEN INDEED WE ARE NOT. WE ARE AG, WE ARE TOURISM, WE ARE A DISTILLERY.” — LINDA LOSEY are going to the liquor store because they like us and they don’t want to drive all the way out to the distillery, and that liquor store is also selling craft beer and wine and Coca Cola and all these other things that they can’t get here.” Requiring tasting rooms to participate in the bailment system is founded upon the supposed competition between liquor stores and tasting rooms. But they are not the same thing. Liquor stores are an efficient way for customers to buy a multitude of spirits and other products. Tasting rooms offer their customers an experience, but not convenience. People that visit a distillery are not going out of their way to buy a bottle they could have bought nearby at a liquor store, and vice versa. They are not competing for the same business. The Distilled Spirits Council of the United States, DISCUS, along with Losey and her private legal counsel, all agree that classifying distillery tasting rooms as retail liquor licensees is a misinterpretation of the state laws. Distilleries fit some definitions of the classification, but not others, yet they are still required to pay all of their distillery fees plus the fees of a retail liquor store and the market zone tax. Losey says the law was supposed to change in 2010 when the second market zone liquor store bid took place, but that didn’t happen. “The legislation never got put in,” she tells. “It was an oversight. That’s what we’ve been told.” On November 24, 2014, Bloomery sent a letter to the Commissioner of the WVABCA, saying that the current system was crippling their business and that they were not going to pay bailment until the misunderstanding had been resolved. On December 15, WVABCA representatives met with Bloomery and assured them they would render a decision by January 5. By the end of January, nothing had happened, so Bloomery looked at closing. “First, we didn’t want to accrue any fines and penalties, and second, we can’t continue on if it’s going to remain this structure,” explained Losey. “It’s a system that doesn’t work.”

SB 574 On Friday, February 13, three days after closing their doors, Bloomery was told they had three days to introduce new bills

WWW.ARTISANSPIRITMAG.COM 51


to the WV legislature. Linda Losey credits much of the state’s

capped at fifteen thousand dollars, annually. Still more than

response to Bloomery fans who emailed a “Save the Sweetshine”

anyone else in the nation, but it’s a start.

form letter from their website to state officials. Rob Losey says they started writing the bill immediately.

Rob Losey says the bill also helps distillers by eliminating fees for services they never received.

“Linda and Tom and I had the nuts and bolts of it and our

“This way we ended up eliminating service fees for services

attorney put it into the proper language,” he shares. “We also

that we don’t really get from the state,” he explains. “It doesn’t

had very good support from all of our legislators in this area.”

physically go into bailment, they don’t inventory it, they don’t

In its first draft, the bill eliminated all of the bailment fees,

ship it, any of that. On paper we’ll sell our liquor to the state

but that violated the state’s three-tier system. They amended the

and we’ll buy it back. It will be marked up 5 percent and 80

bill, then passed it on to their retail partners for review.

cents per case bailment fee. It used to be 28 percent markup,

“It took some time negotiating with the retail association to make sure that we had something that would work for them and work for us, too,” he tells. SB 574 did not change anything for liquor stores, but it

80 cents bailment, and 2.30 for handling.” Although the bill would not take effect until June, Rob Losey says they chose to reopen Bloomery in May to get the team back together and get the still running again.

included language that required distillery tasting rooms to retain

“We did not want to jeopardize our business and our team

the 10 percent minimum markup so they could not undercut

being separated any longer,” he tells. “Before, we were losing

liquor stores. This way the partnership would remain intact.

money in our tasting room, and that was our big issue, that’s

Compromises made and parties in agreement, the bill headed to the floor where it passed 92 to 8 in the House and unanimously

why we closed, because we just could not afford to stay open. Hopefully, we’ll get to use the right color ink now.”

in the Senate. Among the most powerful changes for distilleries, the market zone tax was reduced from 10 percent to 2 percent, and is now

Bloomery Plantation Distillery is located in Charles Town, WV. For more info, visit www.bloomerysweetshine.com or call (304) 725-3036.

52 WWW.ARTISANSPIRITMAG.COM


6

w

telltale signs it’s time for a PACKAGE REDESIGN WRITTEN BY DAVID SCHUEMANN

hether you’re a boutique producer or a multi-million

market where you may be able to shift your brand for better

case global brand, the time will inevitably come for a

performance. A redesign can help your brand stand out from

package redesign. For better or for worse, market success simply

the crowd, stake a better position in your category and stave off

doesn’t allow for stagnancy – it demands change to keep up with

brand challengers.

trends, to expand product lines, and to maintain engagement with consumers.

1

Sales are lagging.

3

Poor brand architecture with unclear tiers.

I can’t tell you how often I see this! If your consumers can’t

This may seem like a no-brainer, but often brands are hesitant

tell the difference between your $100/bottle “icon” tier and your

to invest in a new design when sales are lagging due to reduced

$20/bottle nationally distributed tier, it’s time for a redesign.

cash flow. Many companies wait too long to make a change,

While this may be an extreme example, many brands encounter

allowing their brand to lose more market share, key placements

similar challenges as they add new SKUs or tiers within their

and consumer loyalty to competitors.

portfolio. New tiers or SKUs can infringe upon existing product

A new package design can provide a number of benefits:

offerings and cannibalize sales. Retailer discounting can further

• Reinvigorating

distributors

and

salespeople

with

something new and exciting to talk about.

exasperate the issue by pricing higher quality offerings too close to less expensive products in your portfolio. A package redesign can provide clear delineation between tiers. Better yet,

• Refining or redefining brand positioning; restaging the

packaging that appears more premium than your price point can

brand to compete more effectively against competitors.

help stave off discounting by retailers by building inherent value

• Signaling existing consumers that you are investing in the brand and creating shelf-pop that can attract new consumers. A little bit of brand “buzz” goes a long way.

into your packaging. Start-ups would be well advised to develop a carefully considered tiering strategy as they map out their product lines for launch and future plans to avoid issues later.

2

New competitors have entered the marketplace.

As new categories become more popular and trendy, more competitors will by vying for a piece of the action. Start by doing

Setting appropriate SRPs and making sure that your brand packaging fits the promise associated with your target price point is crucial to evoking value in your brand and gaining customer acceptance.

Weaknesses, Opportunities and Threats) of your competitors and

4

your own brand. This will provide you a more complete picture

Perhaps your brand has recently garnered high scores from

of your brand’s current landscape and help identify gaps in the

critics, or you are increasing the quality of your product. This

a market audit of your competitors and a SWOT (Strengths,

You want to increase price.

WWW.ARTISANSPIRITMAG.COM 53


provides the opportunity or necessity for your brand to take a price product line. increase. A new package design is crucial for communicating

Usually if you are line extending your brand it’s realizing some

outward this “unseen” higher quality, and ultimately justifying level of marketplace success. Where a packaging upgrade may the price increase. More premium packaging will reassure not have been possible before because of budgetary concerns, it retailers and consumers alike that they are getting real value for may now be possible. their money.

5

Contrary to popular myth, the best time to redesign is often when you are experiencing success and not triggered only by

Production requirements change.

sagging sales. The old adage “Don’t fix it if it isn’t broken” couldn’t be further from the best practices in alcohol beverage

Often times, a change in production equipment or technology branding. It’s much easier to introduce new and improved provides the perfect opportunity to explore a package refresh packaging when consumers are seeking your brand out and your that takes advantage of improved production techniques or distributors are having success with your brand than when your brand has slumped or lost distribution. Leverage your success. efficiencies as you grow. Optimizing your brand before expansion also avails you the

Most brands start small and utilize slower packaging processes

initially, including handwork. As brands grow though, these opportunity to refine your messaging, make your packaging feel packaging processes may prove inefficient for the new demands more premium in appearance and adjust your brand system so of increased production. New technologies, faster bottling that it will allow for the easy addition of new products in the future. Be careful here. While updating packaging can be a way to lines, new bottle options, better decorating or printing can both accentuate your design and provide cost savings with your cost- attract new consumers, if you are upgrading an established brand you want to be careful that you don’t alienate your existing of-goods. It’s important that your package design is optimized to take consumers that made you successful in the first place. Take a moment to evaluate your brand. Take inventory of the into consideration both the production constraints and potential opportunities for improvement in order to maximize your brand’s components that are not working and conversely the equity design while retaining maximum COGs savings—they are not elements that are crucial to your brand. Equity elements should mutually exclusive! Often packaging can be designed to be far be leveraged in any new packaging. They can be updated and improved upon as long as it is done in a way that allows existing more premium in look without an increase in cost-of-goods.

6

consumers to still recognize your brand. Remember, generally

New SKUs are being added.

speaking, the larger the brand, the smaller the changes that can be made responsibly. So, you think it’s time to redesign? Then create a killer package

As your brand experiences success, line extensions of flavors,

types of alcohol, seasonal or specialty items and higher end design that will propel your brand to the next level. or limited edition items are a natural next step. If your brand

David Schuemann is the Owner and Creative Director of CF Napa

is considering adding new SKUs it may be an opportune time Brand Design. For more information, visit www.cfnapa.com or call to reevaluate your brand’s “family look” in order to unify your (707) 265-1891.

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54 WWW.ARTISANSPIRITMAG.COM


TURNING YOUR SPENT GRAINS INTO A REVENUE SOURCE WRITTEN BY STEVEN SEIM

W

hen someone starts a distillery, it’s a good bet there are

poultry (monogastric) producers have generally used much

a lot of tangential elements of their business that they

lower amounts because of the high fiber content. However,

hadn’t anticipated being as much of a burden as they became.

that attitude has begun to sway due to several market factors,

One of those line-items might be what to do with your spent

including many successful feeding trials. As understanding has

grain.

increased by nutritionists and livestock producers, so has the

Depending on your local laws, your options might be throwing

willingness of farmers to include spent distillers grains in their

it away (landfilling), dumping it down a drain (and paying the those expenses. There may, however, be another option that can

In 2015, according to Rosentrater, 35-40 million metric tons of distillers grains will be produced in the U.S. Most of the distillers grains are

provide new revenue. We recently heard Kurt Rosentrater, with

produced from the fuel ethanol industry, but there is a sizable

the Distillers Grain Technology Council, speak about whether it

quantity from the beverage distilling industry, as well. Some

can be worth selling spent grain to farmers for use in animal

nutritionists now say that dried distillers spent grain (Distillers

feed and how the feed market is evolving to use more spent

Dried Grains with Solubles, known as DDGS) can comprise up

distillers grain in their animal feed supply chain.

In feed, 1 ton of DDGS can replace 1-1.2 tons of corn and soybean meal, so there is a sizable benefit to farmers who

city a tax), or giving it away to a local farmer in order to avoid

In the past, ruminant animals (beef and dairy cattle) have consumed most of the distillers grains in the U.S. Swine and

livestock diets.

to 40% of feed for swine, and 20% for poultry.

WWW.ARTISANSPIRITMAG.COM 55


WE’RE SERIOUS ABOUT OUR WORKSHOPS. WE JUST LOOK LIKE WE’RE HAVING FUN…

introduce spent grain into their livestock diets. How much can a distiller expect to get paid for their spent grain? Ten years ago, according to Rosentrater, the price was about $110/ton for dried spent grains, and between $25 and $40/ton for wet grains. In the last couple of years, the price for DDGS has averaged around $300. For the DWG, distilleries can expect between $50 and $100 per ton depending on local markets. Some distilleries have even begun to brand their spent grains, which can result in price increases for the distiller, and thus more profit. DDGS pricing versus its two main competitors in livestock feed (corn and soybean meal) have been favorable to

Since 2011, the price of DDGS has hovered around 50% of soybean meal, and has stayed roughly equal to or slightly below that of corn.

distillers (and the farmers buying from them).

AMERICAN DISTILLING INSTITUTE

DISTILLING WORKSHOPS SUMMER/FALL 2015 WORKING WITH BOTANICALS

Gin, Liqueurs, Bitters, Amaro and Absinthe Instructor: Stephen Gould Golden Moon Distillery, Golden, CO Learn the techniques used to produce spirits and liqueurs with herbs and botanicals using varying methods of infusion, maceration, distillation and re-distillation to achieve a desired flavor.

July 30 - August 1

HANDS-ON BRANDY DISTILLING MASTER CLASS Working with grape varietals Instructor: Hubert Germain-Robin McMenamin’s CPR Distillery, Hillsboro, OR.

Get hands-experience with fermentation, distillation, barrel management and blending, and learn the nuances that make a truly unique brandy from a world-renowned master distiller.

October 18-23 For more information, go to www.distilling.com/workshops ®

American farmers aren’t the only ones who can take advantage

Currently, about 75% of distillers grain used in feed is used in the United States and 25% is exported. In the coming years, of using spent grain in feed.

exporting to other countries will be a major factor in the distilling industry being able to profit from selling alcohol byproducts. In 2010, China became the largest importer of American DDGS by far, so much so that other countries have been importing less since then. In 2014, however, China banned importing DDGS in order to force farmers to use more of their local corn supplies. Other countries now stand to benefit by having more DDGS available to them, and Rosentrater highlighted several markets (the biggest being Canada and Mexico) whose imports should rise in coming years. Rosentrater helped to explain the benefits of de-watering spent grains from stillage, and selling in semi-wet form (DWG). His bullet points included that water increases weight, which in turn makes shipping more expensive, and that the solids are what is wanted (not the water): the solids are nutrient-rich and are what is used for animal feed. He also listed several options for equipment that distillers can use to separate water from spent grains: separators with large filters, hydrocyclones, filterpresses, V-Belt systems that act like big squeegees, centrifuges, and more. A distiller’s return on investment depends on volume and the size of equipment purchased, but certainly many

can benefit by investing in de-watering and possibly drying their grains on premises rather than paying more for shipping stillage or for disposal. Besides separating water from solids, there are other challenges to transforming your spent grain into a revenue

56 WWW.ARTISANSPIRITMAG.COM


source. The cost of marketing and promoting your spent grain may be a challenge to some distilleries, which means you’ll have to rely on networking or word of mouth in order to find buyers. Perhaps the biggest deterrent to sales of DDGS is the variability of nutritional composition from distiller to distiller. Different production practices can result in wildly different spent grain. Rosentrater said, “Livestock producers need consistent feed products; inconsistency is not good for animals.” Despite these hurdles, the market for using DDGS and DWG continues to grow. An opening market that Rosentrater mentioned is fish food. There have been good experimental results replacing up to 60% of fish meal with DDGS. He said, “Fishmeal is the holy grail of livestock feed,” because the price for a ton of fish meal often reaches $2000, compared to a farmer spending $100-$300 for a ton of dried distiller’s

If farmers start to integrate DDGS into their fish feed, it will benefit distilleries to start focusing on that market. Rosentrater said “Distilleries

spent grain.

should keep in mind, though, that the beef, dairy, swine, and poultry markets are well established, and should be very easy to tap into.” And if you decide you are willing to sell any of your spent grains? You will need to know about an organization called AAFCO, the American Association of Feed Control Officials. They have categories related to all distillery byproducts, ranging from wet to dry, and these definitions need to be tagged on your spent grain to legally be sold as feed in the

There are also, of course, rules with the FDA that need to be followed. According to the

United States.

Food Safety Modernization Act, “if you are a livestock feed producer you have to follow its good manufacturing practices and sanitary guidelines,” Rosentrater said. However, those rules are currently being debated by the FDA and will be finalized late this summer. There are also different compliance dates according to the size of your company and the amount of spent grain you sell that determines exactly when a distillery has to comply with these rules. Whether this is a viable option for a craft distillery will depend on your specific operation. However, when the alternatives are ING

paying to dispose of spent grains or giving them away, the

More information can be found at the Distillers Grains Technology Council website: www.distillersgrains.org

RA

ignored.

ND

opportunity to turn them into a revenue source should not be IGNITE BEVE

RAG

EB

Your one source for

complete label design,

branding and marketing.

503.244.0836 www.ignitebeverage.com

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DAY JOBS AND f

or a majority of craft distillers, holding a day job while working at their own distillery is a fact of life. Often this transition from a day job other than distilling into being a full-time distiller occurs over a gradual shift in time. From being employed by someone

else or working in another field to eventually moving into full-time distilling, the journey can be long and laboring…but (hopefully) lovely. Several of our comrades in distilling graciously shared their experiences, thoughts, and advice on the transition from Day Job to Distilling. We procured benefits, drawbacks, and advice from our friends in the craft world that have already made (or are in the process of making) the transition.

INCOME SECURITY: Nothing is better than knowing that paycheck is still making its way to your bank account on a regular schedule. Financial security is a big concern for many people—money causes a lot of stress and a day job can alleviate that pain.

BENEFITS —

FREES UP OPERATIONAL REVENUE:

of sticking with the day job...

HEALTHCARE: It’s surely nice to know that if you or a family member is injured, you have that cushion of healthcare to take care of the need. Injuries and illnesses can flatten a bank account— insurance can shield that blow.

If you’re getting a paycheck from another source, you aren’t in the FAMILY IS position that you need to necessarily PROVIDED FOR: The pay yourself—this makes it day job paycheck? It puts possible to put more money back food on the table, takes care of into the distillery since you have your mortgage, and keeps your your income taken care of by family happy. The kids won’t another source. have to go without shoes, most likely.

RETIREMENT CONTRIBUTIONS:

We’re not getting younger, are we? Many day jobs provide money to our 401K HIRE AND funds. Distilling doesn’t exactly DELEGATE: If you YOU’RE HOW provide this—unless you’re can, hire someone to help with PART OF A CLUB: good at planning ahead the distillery. Find dependable TO WORK A majority of craft distillers and remember to set employees that are smart and YOUR WAY have other jobs or make a some $$$ aside for responsible. They can be your transition from a day job to OUT... your future. biggest asset, and can save distilling. It’s incredibly common your ass(et) in a pinch while you’re to be working somewhere else FLEXIBILITY: busy at the day job. as you’re getting up and If your day job has some running in craft spirit ORGANIZE AND PLAN: Keep a schedule that flexibility, that’s awesome! If not, see production. maps out your work with both your day job if you can find some ways to negotiate with and your distillery, and remember to project forward what will be happening for your distilling schedule. Also, set up separate social media and email accounts to stay organized.

BE TRANSPARENT: Your distilling job and day job will collide. Be honest with your employer about what you are doing in your “free time.” They’ll appreciate your honesty and will be more likely to have grace when you find yourself in a distilling emergency.

your employer for increased flexibility. Could you take some overtime one week in exchange for a lighter load another week so your mash schedule is manageable? You might be surprised what you’d be allowed to do if you just ask.

HAVE INTEGRITY: Don’t forget who’s paying you that check each month. You’ve been hired to do a job—do what’s expected of you, and be honest and honorable. Your employer will appreciate this.

EXIT STRATEGY:

Work with your employer to develop a strategy for you leaving the day job. Maybe this is a 3-6 year plan of where you gradually move away from being a key player in the organization. Find common ground that you can agree on—this will give you a plan of what to be working towards and will put your employer’s mind at ease regarding your commitment to your work.

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DISTILLING

WR ITTEN B Y AMBER G. CH R ISTEN SEN -SMITH

While keeping the day job can mean security, it can also mean insanity for your precious brain and body. Be smart about the choices you make and weigh your options for keeping or ditching the day job. It can be a huge challenge, but the shift is certainly doable.

MEET UPS: Trying to find time to meet up with distributors and vendors will be a challenge as you try to work around your lunch and breaks at the day job. Also, finding ways to get to distilling events will be a challenge.

DRAWBACKS —

of holding on to the day job...

FAMILY AND PERSONAL TIME: Your family will

Because you are at the day job, you’ll have to compromise JUGGLING some things. Your production TIME: You will schedule may not be as aggressive be busy. You will as you’d like and you may have have commitments to move slower than you at your day job, at anticipated with items at the distillery, and at the distillery. home. You schedules will collide and it will be complicated.

need to be understanding and supportive of your schedule and what you have to sacrifice in order PRIORITIZING: to make the day job and distilling Prioritizing will be work together. Personal time hard as everything on your and relaxation will not plate will seem important and really exist. necessary to complete—items at the day job, items at the distillery, WORDS items at home—you’ll need a clear head and nerves OF ADVICE STRESS AND of steel to figure FATIGUE: You will FROM it all out. definitely be tired. With a lack of hours in the day, you will be jam-packing all your work in as need be and you will be maxed out.

DISTILLERS

CASEY MCGOWAN,

TRAILHEAD SPIRITS —

On hiring employees: “Surround yourself with good dependable people… step out of their way, let them do what they are good at…in turn they will give you all they have to help everyone succeed.”

PATRICK SIMPSON, STARTUP DISTILLER — On

LOSING TRACTION:

ERIK MARTIN ,

ARIA GIN — On making the transition: “Quitting the day job will mean that you will rise and fall of your own accord.”

TRISH & GREG SCHWARTZ,

2

LOONS

On working in a partnership at the distillery: “We divide the workload into what our strengths are. We both can do it all and most often are involved in every aspect of NICOLE AUSTIN, KINGS COUNTY DISTILLERY — On making your the business, but try to focus on our strengths exit: “Be prepared to stay as long as they need, to obtain some consistency and efficiency.” and be prepared for them to show you the door TOM BURKLEAUX, NEW DEAL DISTILLERY — that day.” On finding balance: “Let go, if only for a few DAN FARBER, OSOCALIS — On having a day hours each night.” Giving yourself some time job: “A lot of people have day jobs and it’s to unwind can keep you fairly normal.” healthy. TED PAPPAS, BIG BOTTOM WHISKEY — On FINAL planning: “As an owner, you need to focus on long-term goals of the distillery—that’s your WORDS The devil main job.” is in the details, as they say. Plan

when it’s time to leave the day job: “When it becomes more of a hindrance than a benefit.” STEVEN STONE, SOUND SPIRITS — On PAUL ZIEGMAN, TINBENDER CRAFT DISTILLERY employees: “Hire self-motivated people” and “Rely on your partners.” Keep your sanity — On the transition: “It is important that with managing a day job and a distillery with distilling is always fun, and not ever a job.” dependable people you can lean on

DISTILLERY —

ahead and you will find when it’s the right time to drop the day job and move onto only Y distilling. The transition ENJOE TH EY can take time, but can URN O J be wildly worth it !!!

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DSP Federal Reporting

This is the second in a series of articles providing a focused look at the Federal regulatory requirements for filing reports of operations and excise tax returns and payments.

I

n the last article, the TTB Production monthly report was presented. The current topic is the Storage report,

which reflects a monthly summary of bulk quantities of distilled spirits products entering, leaving and remaining in

MONTHLY REPORT of STORAGE OPERATIONS TTB FORM 5110.11

the Storage account. After spirits are declared as “produced,” or, when spirits are received from another plant, or, received from Customs custody, they are generally accounted for on the storage report. The first item to note in respect to this report is that a DSP

WRITTEN BY JIM MCCOY

may be required to file up to four storage reports per month. Four reports? Take a look at the report form in the top center. In the box titled “Report Covers” – you will see four check boxes, labeled “Domestic Spirits and All Wines,” “Imported Spirits,” “Puerto Rican Spirits,” and “Virgin Island Spirits.” Most artisan distillers, fortunately, will be filing a single Storage report, as they produce and handle only

“domestic” spirits (distilled in the USA). However, should a DSP decide to purchase whisky, neutral spirits, rum, tequila or other product distilled outside the USA, a Storage report would be used to account for imported spirits. Due to tax issues attendant to rum, Puerto Rico and Virgin Islands spirits are each also reported separately.

MONTHLY REPORT OF STORAGE OPERATIONS, TTB FORM 5110.11 The Monthly Report of Storage Operations, TTB F 5110.11,

mingling or processing are normal, and the difference between

reflects the quantities of SPIRITS RECEIVED INTO THE STORAGE

the filled quantity and the quantity dumped is recorded and

ACCOUNT on LINE 2, under each of the class and type headings

reported as a loss in the DSP records.

in columns (b) through (l). The entry on LINE 1 in each column,

ON HAND FIRST OF MONTH, would reflect the inventory of spirits that was reported on LINE 23,

ON HAND END OF MONTH, from

the previous monthly Storage report.

While Line 2 captures the total of spirits received into the

IMPORTS (and PR or VI spirits) BULK SPIRITS are returned to the

account for the month, note for that LINE 3 is used, and if

DSP they are shown on LINE 4. A simple basic rule found in 27

The Storage report is a basic account style report, where the

CFR 19.351(c) is that bulk spirits cannot be transferred back

starting inventory, plus additions, is compared to reductions

into Storage from the Processing account. Further, spirits from

TOTAL figures on LINE 6 for the

the Processing account at another plant cannot be transferred

upper portion of the report must match the Total figures on LINE

in bond and deposited into the Storage account. This basic rule

24 for the lower portion of the report. Losses on LINE 22 and

is meant to ensure that the products entering storage are kept

gains which would be reported on LINE 5 would balance the

within their already determined class and type while in Storage.

report. Typically, a bulk accounting for liquids, especially when

Products of different class or type may not be mingled in the

volume is temperature sensitive, will result in a net gain or loss

Storage account, also for this reason.

plus the ending inventory. The

during a given period when products are being entered into and removed from tanks or smaller bulk containers.

BULK WITHDRAWAL OF TAXPAID ALCOHOL FROM STORAGE would be reported on LINE 7; this is generally a rare occurrence

Whisky, rum and brandy each can be aged in oak barrels,

for a small distiller. Such a withdrawal would likely be for

sometimes for years. Loss due to evaporation or leaks, and losses

shipment to a flavoring company for non-beverage use. LINES

during the emptying of the barrels when they are dumped for

8, 9 AND 13 are unlikely to be used. LINE 10 might be for a

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DIRECT EXPORT OF BULK SPIRITS; LINES 11, 12 AND LINE 15 entry into a FOREIGN TRADE ZONE or into CUSTOMS BOND. LINE 14 would be for a TRANSFER OF SPIRITS TO A BONDED WINERY for use as wine spirits, or alcohol transferred to a

be included in the Received for Redistillation entry on Line 15

winery for use in making non-beverage wine. LINE 16 might be

of the Production report.

used to report SHIPMENTS OF LABORATORY SAMPLES OUT FOR

TESTING—see

the rules in 27 CFR 19.434 regarding removal

of samples.

and on the appropriate lines in Part IV on page 2 of that report.

LINE 18 reports any amounts RETURNED TO THE PRODUCTION ACCOUNT FOR REDISTILLATION; any such quantity would also

TRANSFERS OF SPIRITS IN BOND TO ANOTHER DSP from SPIRITS VOLUNTARILY DESTROYED would be reported on LINE 20.

Storage would be reported on LINE 19, and any

The most common reduction in Storage inventory will be the

At the end of each calendar quarter, a physical inventory of

PROCESSING ACCOUNT

bulk spirits is required to be documented and certified. That

transfer (Dumping) of spirits into the

for creation of finished products, by reduction to proof, blending

inventory would be reflected as the closing INVENTORY on LINE

and bottling. Entries on LINE 17 of the Storage report will also

23 for each of the four quarter ending months, March, June,

be included in totals on Line 2 in Part I of the Processing report,

September and December.

The column headings reflect specific types of spirits that you might receive into the Storage account. Whisky and Brandy

Next time we will review the preparation of the Processing report, TTB Form 5110.28.

are split into two columns, by proof determined at the final production gauge. Each column reflects a kind or type of spirits, as reflected in the Standards of Identity found in 27 CFR Part 5. As briefly as possible, the reporting of Storage operations on TTB Form 5110.11, due to be mailed or filed through Pay.Gov by the 15th of each month, has been presented in this writing.

Jim McCoy is Managing Consultant for J. McCoy Alcohol & Tobacco Compliance Consultants LLC in Cincinnati, OH. Jim served over 32 years with ATF and TTB, establishing his consulting firm in 2010 to assist alcohol and tobacco businesses in their efforts to meet Federal regulatory and tax requirements. For more information visit www.jmccoyconsultants.com or email jmccoy@jmccoyconsultants.com

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E

N

D

THE

L

E

ONLINE SHELF

S

S

WRITTEN BY SUSAN MOONEY

T

he results are in: craft beer and artisan spirits are a hit with the consumer! The marketplace loves the variety and the

opportunity to support local breweries and distilleries. Consumers might even have a friend or family member who has decided to brew their own beer or distill their own gin. The craft boon has created jobs, brought about an increase of suppliers for dry and wet goods, but in turn, created new challenges. Though these challenges are a good sign for the industry, all this choice can create clutter and confusion for the consumer and a big challenge for the retailer. A bar only has so many taps and so much back bar space. Liquor stores, particularly in metropolitan areas, have limited shelf and storage space and the

spirits brands, 8,000 wine labels and 3,000 different beers in each retail store. For John Jordan, the Vice President of the Customer Division, this means that the brand needs to create and provide brand relevant content to highlight their product in the online store. A brand’s web page and social media presence needs to be brand consistent and well organized. Often the consumer has made their purchase decision by the time they reach the store. In the case of Total Wine, their model relies on in-store pick up instead of delivery. Its goal is to be a destination store where consumers can curate their shopping list online.

CONSTANT BRAND “DRIPPING”

Brands need to regularly analyze what is required in this top liquor retailers know that they need to be informed about the changing landscape. A great package, hang tags and shelf products they are selling. Consumers with too many options can talkers still play a role in the physical retail space, but the start to see a blur of one big mass of “craft products” without online component significantly expands the brand requirements establishing a connection with any individual brand. Emerging to help their product sell. Realize this is not accomplished in bands struggle with supply and the task of differentiating their any one definitive moment, no single kickoff campaign or killer

brand. How does retail deal with the challenge of allocating space tagline. You will need to constantly “drip” your brand message on a tap, in the cold box or on the shelf for new and interesting and identity to the retail outlet and the end consumer. The brands? And what can your brand do to make a compelling case brand must do three fundamental things well to differentiate for this coveted retail space?

Retailers see online sales as a promising, but a still evolving option, and are frantically working to improve their online retail presence while integrating the online sales experience with

themselves from other brands and drive sales:

1.

A MEANINGFUL BRAND STORY A N D P U R P O S E . This brand platform has

to be

their store experience. Some retailers have realized online sales well thought out and allow for consistent consumer emotional provide a much needed opportunity to expand their offerings, engagement and have multiple “hooks” to hang that on over test what sells and to feature small batch or special products time. In other words the brand has to be able to live, breathe that would not necessarily fit into their physical footprint. Liquor and grow as time goes on. This is not a new concept, but the stores can use the online sales option to expand their shelf implementation of this has dramatically changed. For example, if space beyond what can be stocked within their stores. Consumer you are an organic brand or a brand that is delivering a ‘healthier’ convenience and brand information are also important driving option, you will want to show this in the events you choose, the forces in the creation of robust retail sites. Consumers can learn partnerships you forge and the events you sponsor. You also need about new brands and products on their own time and then to show this living part of your brand through appropriate event choose to order online or go to the store with their shopping list photos on Facebook and Instagram as well as through your tweets mostly determined.

and whom you choose to follow. If you are an Irish product you will

For example, Total Wine & More carries approximately 3,500 want to tie that into what your brand is doing locally. If you are a

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ready to drink cocktail you will want to emphasize convenience train their staff and actively engage the consumer. Retailers and work that into your brand narrative. The challenge today is also encourage brands to provide video and other image rich to create a brand that is interesting to consumers who have a content about their product, which enhances consumer interest. very short attention span but are very sophisticated in identifying This same content can then also be used in a variety of online inconsistencies in message and actions. Your brand needs to social platforms and for promotional purposes and to get the end withstand online scrutiny (i.e. ferreting out false stories and/or consumer involved. Filming your production process, a tasting, claims) and has to be able to tweet and post multiple times an event, your grain or grape harvest or even your bottling or label each week without coming across as bland, or worse, annoying. application process can be interesting and make consumers feel This ongoing “brand dripping” is not an easy process. You have like they are involved with the brand. Total Wine estimates that to be believable, interesting and informative. If not done with its new ecommerce site will have over 40 hours of video with a strong central concept, your online presence risks appearing plans to add more in the near future. To keep your messaging fragmented and confusing, not allowing for consumer connection fresh, even unchanging elements like your production process with the brand.

must be explained in new ways over time to continue to engage

2.

consumers. Consider doing seasonal pieces or focusing brand

ONE MESSAGE, A MILLION MOMENTS.

content specifically on a variety of platforms — a series of The frequent communication aspect of online branding Pinterest photos instead of a Facebook post. Make sure that your requires well-crafted and updated ongoing brand relevant retailer has important content about special offerings or holiday content. Information about the product, its production method related content in plenty of time to integrate it and use it in and its unique features must be provided to retailers for their their sales material. Make sure you know their timeline to update

own ecommerce sites so that they can effectively market and their online content about your brand. Updated and well-curated sell your product. While it is important to learn from your key content keeps your consumer interested and helps your retailer

retailers what content they are looking for, it is crucial to provide sell. While creating this content is fun and not complex, it does them with the information necessary to learn about your brand, require an investment of time and money. All efforts will require

64 WWW.ARTISANSPIRITMAG.COM


tracking, tweaking and potentially changing direction if it does talker to the brand video on Youtube. If you are not consistent or not resonate with the end consumer.

3. S T R U C T U R E D

CHAOS.

clear in your message, the retailer and the consumer will perceive this disconnect, become frustrated, and give up on your brand. Once your brand At worst, they may post, tweet or blog negatively about your

information is established on a variety of social brand. You can’t control consumer posts, but you can ensure

platforms and retail ecommerce sites which you plan to regularly that you are listening as well as talking online and respond in update, keeping track of all of this can seem daunting, even a timely, open manner by tracking your company name and with highly specialized data and reporting from Sproutsocial or product via Google alerts or Mention. Keep in mind, you will also Hootsuite. The data is only useful if you have the opportunity attract negative responses if your brand’s promises are stretched and understanding to analyze it and make sense of how this is or outright inaccurate. Eventually, your brand “inventions” will affecting your brand, what is working well and what needs to be uncovered — be transparent from the beginning with your improve. Furthermore, the different platforms have constantly brand information. These negative posts are easily found and can evolving rules and tools. By June, it is unlikely that Facebook discourage a retail buyer or an end customer from purchasing posts will reach any significant consumer group that you have your product. not paid to reach. This requires a recalibration of your strategy

As retailers become more serious about online sales and begin

and potentially a shift in emphasis or a budget change. If you are to create more complex online and offline strategies, brands will regularly updating the retail sites with content at the same time need to stay on top of this process by providing more sales tools you are updating social media, you will need to stay organized, to the retailer and to recognize that they have another point of make sure retailers have included the latest content and make relationship with the retailer that needs to be nourished. Done time to evaluate your efforts.

correctly, brands will have an endless shelf for their products.

In addition to this, there is the external challenge of consumer

Susan Mooney is CEO and founder of Spirits Consulting Group. For

perception across multiple touch points from the low-tech shelf more info, visit www.spiritsconsulting.com or call (646) 494-4242 .

Stock Inventory Custom Design Decorating Capsules Closures Corks

Y OU R C LE AR C HOICE F O R P R E M I U M PA C K A G I N G S O L U T I O N S

For more than 25 years, Saxco International has been helping distillers create the packaging identity that is their brand. We offer a comprehensive range of products tailored to craft distillers, that includes bottles, corks, closures, and capsules. And for turn-key packaging needs, Saxco is the one-stop-shop solution for bottle design, decoration, and secondary packaging components.

rbelke@saxco.com

jgoldner@saxco.com

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MICROBIAL CONTAMINATION

AND IMPLICATIONS FOR DISTILLED SPIRITS PRODUCERS W R I T T E N B Y P AT R I C K H E I S T, P H . D

t

///

PHOTOGRAPHS PROVIDED BY BERM SOLUTIONS, INC.

he basic ingredients used to make different distilled spirits

bacteria and yeast produce various organic acids and other

are well known. Rum is distilled from fermented cane sugar.

metabolic byproducts that can build to toxic levels, further

Bourbon whiskey is made with a combination of grains including

impacting fermentation. Apart from potentially devastating

corn, wheat or rye, and malted barley (among others). Vodka can

yield and production issues, contaminating microbes can

be distilled from a wider range of fermented starting material

also influence flavor of the finished spirit. Here we discuss,

including potatoes, various grains or sugar. Another ingredient

in detail, microbial contamination with a focus on factors

of fermentation is the yeast, responsible for taking up the sugar

important to distillers and how this might contribute (positively

and producing ethanol and other flavor components. However,

or negatively) to the flavor profile of the finished spirit. We

there is another subset of “ingredients” present in almost every

will also discuss methods for prevention and control and

fermentation, but unlike those described above, these “other

different ways to diagnose microbial contamination issues.

ingredients” were not put there intentionally. These “other ingredients” are what can be collectively referred to as microbial contamination. These are microorganisms (most often bacteria and/or yeast) that gain access to the fermentation via the grains, water, fermentation tanks, piping, backset, dust, and other sources. These contaminating microbes are important for several reasons. One of the most significant consequences of microbial contamination is that it can severely affect distillery yields and production by competing with the yeast for sugars and nutrients. In addition, contaminating

“HOUSE BUGS” Often when distillers talk about microbial contamination it is done in very general terms. “House bugs” is one of the common phrases to describe the contaminating microbes that inhabit a distillery. Since there are literally thousands of different potential microbes and microbe combinations in any given contamination scenario, most of them involving wild yeast and/or bacteria, reference to these as “house bugs” hardly seems adequate considering the wide range of potential effects on fermentation and production. In addition, “house bugs” are often touted by distilleries as being crucial to the flavor profile of the finished spirit. Thus, a deeper look into what specific microbes make up those “house bugs” is appropriate and should be done at every distillery.

(FIGURE 1) Ferm Solutions maintains a repository of over 10,000 contaminating bacteria and several thousand wild yeast. Bacteria and wild yeast are isolated and stored cryogenically for further research and development.

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MICROBES OF INTEREST Bacteria and wild yeast that contaminate fermentation are typically those that are found naturally in grains and water. In our collection of over 10,000 bacteria from over 200 different distilleries (Figure 1), the vast majority were identified as “lactic acid bacteria” or LAB. These include bacteria in the genera

Lactobacillus, Lactococcus, Weissella and Pediococcus, among others, which are Gram positive (result of a staining procedure that differentiates bacteria into two main categories based on cell wall characteristics). Within the genus Lactobacillus are many

(FIGURE 2) Examples of Gram positive (purple) and Gram negative (pink) bacteria commonly isolated from fermentation at distilleries.

different species that can contaminate fermentation. Examples

Brettanomyces, to name just a few. Wild yeast, like bacteria, can

include Lactobacillus fermentum, Lactobacillus delbrueckii,

produce toxic organic acids or other metabolic byproducts that

and Lactobacillus brevis. Other Gram positive bacteria found

can affect fermentation. Examples of some of the different wild

in fermentation include Enterococcus and Bacillus species.

yeasts are shown in Figure 3 and are compared to the “normal”

Bacillus species are unique because these are one of the few

yeast Saccharomyces cerevisiae. Interestingly, some of the wild

bacteria known to produce endospores, survival structures that

yeast that we find in fermentation that cause issues are useful in

allow them to survive adverse conditions like desiccation and

other applications. For example, Kluyveromyces species can be

elevated temperatures. For this reason, Bacillus species are

used to ferment lactose to make ethanol. Certain Pichia species

often cultured from samples collected from high heat areas

are used to make ethanol from C5 sugars like xylose, which is

such as during the cook process or from high temperature heat

a component of hemicellulose, another complex plant material

exchangers. Gram negative bacteria found in fermentation

found in fermentation. A Brettanomyces species that is causing

include Acetobacter and Gluconobacter species, but we also

major issues at a distillery might be used to make a sour beer at

see on occasion members of the Family Enterobacteriaceae

a brewery. These are good examples of how one distillery’s worst

(Escherichia coli, Salmonella, Klebsiella, Enterobacter, etc).

enemy can be another distillery or brewery’s greatest asset. The

Various Pseudomonas species are also found, but like other

same is true for many of the bacterial contaminants, as LAB are

Gram negatives are less common than their Gram positive

well known and useful as probiotics. Some distilleries, rather

counterparts. Figure 2 shows examples of gram positive and

than making a sour mash by recycling backset, will propagate

gram negative bacteria commonly isolated from fermentation at

a specific bacterium (Lactobacillus brevis, for example) in a

different distilleries.

separate vessel and once a pre-determined pH or level of lactic

Apart from contaminating bacteria there are several yeast

acid is reached, the culture is heat treated to kill the bacteria and

species. Any yeast not intentionally put into fermentation are

then added to fermentation. This

considered “wild yeast”, which can be from several genera including Saccharomyces, Kluyveromyces, Pichia, Candida and

(B) (A)

(C)

is

an

alternate

method for creating a sour mash.

(D)

(FIGURE 3) Examples of wild yeast (A, B, and C) commonly isolated from fermentations at distilleries. Compare to the normal yeast, Saccharomyces cerevisiae (D).

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PROLIFERATION OF MICROBIAL CONTAMINATION DURING FERMENTATION AND IMPLICATIONS

kinds of contaminating microbes inhabit your distillery. On one hand, having a homofermentative Lactobacillus species that makes lactic acid (organic acids condense with alcohols to make esters) may be a positive flavor contributor (and the foundation

Contaminating microbes get into fermentation through several routes described above. Our research has shown that in most cases involving reasonable cleaning and sanitation, populations of contaminating microbes are low in the beginning (less than 100 viable cells per ml of mash). In the case of grain-based fermentations, this is largely due to the high heat used in the cook process that initiates the breakdown of starch into fermentable sugars. The high heat and residence time of cook significantly reduces the total viable population of contaminating microbes present on the starting materials. Fermentation of molasses or cane sugar where heat is not required might start with higher background contamination, which is a major consideration when fermenting those feedstocks. Once these contaminating microbes make it into fermentation, low starting populations of bacteria and wild yeast can grow and multiply to higher populations. 1x105 viable cells/ml and greater are what we consider to be significant levels of microbial contamination. Any residues left behind in the fermentation vessels, heat exchangers, or associated piping, can serve as a source of inoculum for the next batch. The higher the beginning populations, the greater the potential

of the sour mash process). On the other hand, if your distillery is highly contaminated with the same bacterium that causes diarrhea or pneumonia, that may lead to a different, maybe not so favorable, flavor profile (not to mention it is just gross). Apart from flavor contributions, high levels of microbial contamination can cause severe production issues and yield losses because these contaminating microbes compete with the yeast for carbohydrates and nutrients. Lactic acid bacteria are so-called because they ferment sugars like glucose and turn it into organic acids like lactic and acetic acid. These organic acids reduce the pH of the fermentation and can become toxic when they reach certain levels. This issue is compounded in sour mash recipes if the backset/stillage being recycled already contains elevated levels of these or other organic acids. Once contaminating microbes reach a certain level, one of the possible outcomes is a stuck fermentation. In this scenario the fermentation stops prematurely from overgrowth of contaminants, resulting in leftover sugar and lower ethanol levels. Table 1 shows what a normal fermentation looks like compared to one with significant bacterial contamination.

for microbes to reach problematic levels during fermentation. For this reason, the primary method for controlling microbial contamination involves intensive cleaning and sanitation. This means scrubbing the tanks with soap and water after each

DIAGNOSING MICROBIAL CONTAMINATION ISSUES

batch or using hot caustic (sodium hydroxide). Another reason

Before a distiller can diagnose a production issue, it is

to better understand which bacteria make up your “house bugs”

necessary to know what a normal fermentation looks like so that

is that some are more likely to produce biofilms (Pediococcus

any deviations can be compared to a “normal” scenario. There are

spp., for example). Presence of these more prolific biofilm

several pieces of information collected throughout fermentation

producers may warrant additional, more intensive cleaning

that are helpful, the first being pH. Since bacteria and wild yeast

requirements. Some of these bacteria can be pathogenic to

can produce organic acids as byproducts, when contamination

humans and animals, which is another reason for knowing what

becomes significant this results in a lower pH. Thus, if your

TABLE 1 High Performance Liquid Chromatography (HPLC) analysis from a successful fermentation (A) compared to one with significant bacterial contamination (B). High levels of organic acids (lower pH), incomplete sugar utilization and lower ethanol are consequences of significant microbial contamination.

LINE

DP4+

DP3

MALTOSE

GLUCOSE

LACTIC ACID

GLYCEROL

ACETIC ACID

ETHANOL

A

Normal

0.464

0.111

0.245

0.012

0.110

0.699

0.013

8.598

B

Bacteria

0.564

0.113

1.230

0.926

0.876

0.678

0.120

6.234

DP4+= glucose polymers 4 glucoses or larger. DP3= maltotriose (polymer with 3 glucose subunits).

68 WWW.ARTISANSPIRITMAG.COM


(FIGURE 4) High populations of bacteria growing from mash plated on agar-based growth media. average terminal pH is

to cleaning). So, even though the results may not be available

4.2 and then it drops

in time to save the batch that was tested, the information can

to 3.6 in another

be used to implement strategies to correct the issue for benefit

batch, this may be

of future batches. Another issue with culture-based approaches

a sign of microbial

is that different microbes often require different conditions

Sugar

to grow. For example, some bacteria (certain Lactobacillus

another

species) found in distilleries require anaerobic conditions to

helpful determinant, which is

grow whereas others like Acetobacter require aerobic conditions.

measured by Brix, Balling, gravity,

Other factors like pH, temperature and nutritional makeup of

etc. If your normal terminal Brix is 6.5 and now you are seeing

the growth medium can also vary for one microbe to the next.

a terminal Brix of 8.7 (indicating leftover sugar), this is a good

For this reason, we are looking at molecular techniques to help

indicator of an issue. Since there are other issues that can lead to

us detail the distillery microbiome (what bacteria and yeast

higher residual sugars (spoiled yeast, temperature issues, etc.),

are present and their populations relative to one another). This

coupling a high sugar reading with lower than average pH might

involves extracting and/or amplifying DNA and in some cases

together help with the diagnosis (if the issue is temperature

messenger RNA directly from the mash. This genetic material

related, you would likely not have the lower pH, for example).

is then sequenced and bio-informatics are employed to identify

The aroma of fermentation may also be an indication that there

and quantify any bacteria or yeast, even if they are present in

are issues with microbial contamination issues as bacteria and

low populations or are non-viable. While this testing is thorough

wild yeast secrete organic acids and other metabolic byproducts

and can be faster than traditional culture-based methods, it

into the mash, some of which have sour or otherwise foul odors.

requires expensive equipment and highly trained technical staff

Other byproducts of microbial contamination can be favorable,

to run it. As these methods are refined, they will gain utility in

as discussed above.

the distilled spirits industry.

contamination. utilization

is

Other more sophisticated analyses may be employed for diagnosing and detecting microbial contamination including analytical and microbiological methods. Plating the mash

CLOSING REMARKS

onto semi-solid agar media to visualize bacteria and wild

It is clear from the information above that microbial

yeast populations is one option (Figure 4). If yeast counts are

contamination plays a significant role in overall distillery

performed using a microscope, bacteria can sometimes be seen

production and quality of the finished spirit. We encourage

along with the yeast, which is another thing to look at when

distillers to take a deeper look into their “house bugs� to see if

gauging the severity of a contamination event. HPLC (High

microbial contamination is significant enough for yield loss or if

Performance Liquid Chromatography; see Table 1) is another

there are any microbes of concern. While many distilleries, such

technique that measures sugars, ethanol and organic acids from

as those representing well-known brands, make high quality

a single sample. Most larger distilleries have these capabilities,

distillate, there may be a way to improve production and yields.

but smaller distilleries may have to rely on outside labs for these

In cases where significant microbial contamination has been

kinds of analyses. Once microbial contamination is confirmed,

confirmed, fixing the problem can sometimes result in a 10-25%

the first order of business is to seek out the deficiencies in

yield improvement. That can translate to a lot of extra bottles

cleaning, implement solutions and regain control.

and is a great way to increase production when compared to the

One of the problems with culture-based diagnosis is that it

expense of a distillery expansion. Although we have only scraped

takes 24-48 hours to perform. If you are sending the sample

the surface of the complexities of how microbial contamination

to another lab for testing, sample transit time is added to the

can affect distilleries, hopefully the above information will be

delay. By this time the batch in question may have already

useful for evaluating contamination at your distillery.

been processed. However, our experience has been that once a distillery becomes highly contaminated, it is likely to continue that way until strategies have been implemented to eradicate the causative organisms (again, this is normally some improvement

Patrick Heist, Ph.D. is chief scientific officer of Ferm Solutions, Inc. and co-founder of Wilderness Trail Distillery. For more information visit www.ferm-solutions.net or call (859) 402-8707.

WWW.ARTISANSPIRITMAG.COM†69


notes from the

WORLD WHISKIES

& SPIRITS CONFERENCE WRITTEN BY STEVEN SEIM PHOTOS BY AMANDA JOY CHRISTENSEN

On February 24th in New York City, Artisan Spirit attended the one-day World Whiskies and Spirits Conference.

The keynote speaker was Chris Bauder, the general manager and vice president of Beam Suntory. Bauder explained that he

the craft movement has helped the entire spirits industry. His perspective is something that craft

feels

distillers had being saying for years, and it was gratifying to hear it echoed by one of the large producers. Craft distillers’ willingness to experiment and take risks has started to affect how bigger companies approach their product lines. In the past, distilleries haven’t traditionally carried such a wide variety of products, instead focusing on making either whisky, vodka, or gin. Craft distilleries and their varied, experimental portfolios

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distilleries grow and wondering whether they would be able to

In 2013 there were only four days in the year without a new spirit brand being introduced. This

stay diverse or end up focusing on smaller product lines as they

group discussed ways to stand out and not get lost in the

grow.

repetitive trends that may make waves but can make a product

are changing that. He shared his fascination with watching craft

Mr. Bauder also spoke about a craft boom occurring in Ireland.

one of many instead of one of a kind. They created a fake brand

In 2012 Beam bought the last of the independent distilleries

name and outlined the process of creating art and labels for

in Ireland. Almost immediately afterward, 16 applications were

its various products. As an example, they discussed avoiding

submitted to open new distilleries. Now there are 20 that are

putting un-aged whisky in a bottle that looks like a mason jar

at least in the planning stages. Irish whiskey consumption is

with a story about resurrecting a prohibition-era family recipe,

growing faster than bourbon in America, according to Mr. Bauder.

as there are multiple moonshines that already cover that trope. Besides the bottle design, this group discussed the importance

Joseph Magliocco, the president of Michter’s, was the next to speak. He described the differences in selling bourbon and rye over the last few years. In recent memory they would have been ecstatic to sell 150 bottles nationally in a month. Now they have recently installed two new stills in order to meet demand. Magliocco attributed increased bourbon and rye sales to several sources: spirits writers, an on-premise sales industry (which means bars, pubs, restaurants, etc), and whiskey focused retailers. Writers, he said, are doing for the spirits industry now what they did for the wine industry in the 80s, describing grape varieties and how to make and enjoy fine wines. There are

of doing any little thing possible to show off your brand. They cited making sure your brand is on the outside of the box that your product is delivered to stores or restaurants in. Sometimes those boxes, especially in big cities, are stacked outside a bar before being loaded inside for people walking by to see. Small creative things like this are ways you can get touches with potential consumers. When dealing with a firm that is designing your brand, they warned, don’t be distant from the process. It is your distillery and you will live the brand every day, so make sure any design firm is doing what you want and you agree with the direction they’re going. Your input is crucial.

also two groups he credits with increasing growth of whiskey: DISCUS and women. For future growth, he cites exporting to foreign markets as the biggest wildcard.

David Frost of the Scotch Whisky Association and David Ozgo from DISCUS discussed industry trends. Mr. Frost conveyed the legal trouble British whisky makers are running up against.

Two panels took on the discussion of designing a successful brand through visual imagery and label creation. The first was Ivan Bell. Bell is the managing director of Stranger & Stranger, and he shared the thought processes behind various label and

Producers are fighting heavier taxes and growing health concerns despite growth across the market. He discussed current lawsuits between whisky organizations and the government and has faith that the importance of whisky for Great Britain, both historically

and economically, will prevail. Mr. Ozgo explained that sales goals are increasing among all levels of quality, but high when designing a brand are to create desirability, end and premium are growing faster than low end. a pull that grabs someone’s attention when He expressed that this is good for business as a whole. American they’re walking down an aisle whether it is in spirit exports, 70 percent of which are whiskey, are also growing, color or shape. Taking imagery from a distillery’s facility, or and show continued growth into the future. box designs for several of their customers. His stated

the history of their city, or even direct references to competition,

Bell highlighted several brand case studies that Stranger & Stranger were able to introduce to new markets or reimagine for increased sales.

History is important to the spirits industry, and Dr. Nicholas Morgan gave the history of an important figure from whisky’s

Another group panel also discussed marketing and brand

past. Dr. Morgan is head of whisky outreach at Diageo and

growth, featuring James Goll from 24-Group, Susan Mooney

shared the story of Peter Mackie, a Scotch whisky distiller who

with Spirits Consulting Group, and Raul M. Paredes from O-I.

helped inspire Diageo’s policies and practices that ensure a

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consistent product from year to year. Peter Mackie helped create the White Horse whisky brand around 1890. Besides working for Lagavulin and loving Islay, he spent his life experimenting and innovating on distilling processes. He had a lab where he tirelessly continued to learn and understand the extent to which whisky could be made to similar standards from batch to batch. He is a big reason why large brands can have a product that tastes the same from year to year to year. Dr. Morgan stated that although it doesn’t seem cool to like a brand like Johnnie Walker where every bottle tastes the same, he applauds that achievement as something to be celebrated, and says some of Mr. Mackie’s methods have made their way through the years to Diageo’s current facilities.

James Espey, OBE and founder of Keepers of the Quaich, finished the day with great dynamism. With his over 40 years in the spirits industry from Chivas to Malibu to Baileys Irish Cream, Mr. Espey touted the importance of long-term planning in order to build mainstay brands. He has a ten year rule, saying that it takes ten years to build a brand that can last. He says distillers need to constantly be thinking about the competition

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and how to grow themselves, even when they are already growing. His brands have launched all over the world and he says it is important to travel and discover international markets in which to grow your brands. He sees India and Africa as huge potential markets due to their growing middle-class, and relayed stories of visiting China over the years and how they are changing to be more receptive to imports of high-end spirits. With scotch, which is a specialty for Mr. Espey, he says that blended is a bedrock and has the most potential. Single malts are popular at the moment, but he compared a single malt to a single violin…why listen to only a violin when you can experience a full orchestra? For him, a master blender is like an expert conductor, and the results can be as magical. In his experience, he still believes in gut instinct over relying

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to the distilling industry for over 50 years.

solely on research and focus groups. When launching Baileys Irish Cream he saw research which said it would fail. He ignored the research and now Baileys is successful. He also warned against the trend of raising prices too quickly. He said he’s seen some expensive bourbon that is average, and warns of the importance

“As you build your brands be strong, be courageous, be patient and be international.” of maintaining price discipline. His parting thought was,

Visit www.whiskiesandspiritsconference.com for more information.

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A CRAFTED SHIP KNOWN AS

Philadelphia Distilling WRITTEN BY AMBER G. CHRISTENSEN-SMITH

“Absinthe has a wonderful colour, green. A glass of absinthe is as poetical as anything in the world. What difference is there between a glass of absinthe and a sunset?” – Oscar Wilde

OUT ON A LIMB We see a lot of “standards” in distilling as new craft spirit producers will often start with comfortable and safe products that are surely to be likable and purchased by the average consumer. Over time, however, we’ve seen more and more craft distillers stretching out on the proverbial limb to create items that are not only well-crafted, but will also arouse the curiosity of consumers that discover the newness of an unconventional spirit. Philadelphia Distilling may have one of the most diverse portfolios of spirits we’ve come across to date. Andrew Auwerda, the president and co-founder of Philadelphia Distilling, is a seasoned businessman who relishes opportunities that present new challenges. “I get very pumped up about a wide range of things…from new markets we enter, to new spirits we launch, to press and awareness we create.” The adventure is always blooming for Auwerda. And speaking of adventurous, Philadelphia Distilling has five different labels in its portfolio. Auwerda shares, “We are constantly tinkering and developing new spirits and variations on our existing line.” On the traditional side, there is Shine, The Bay, and Penn 1681, which boast whiskies

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and vodka, respectively. In the mid range, there is the beautifully shows off the skills of our talented distilling team.” labeled and well-crafted Bluecoat, which consists of an American

REACHING ACROSS SEAS

dry gin and the same gin barrel finished in American Oak. But most interesting to note is Philadelphia’s fantastic Vieux

As of recent, Auwerda has been working with his label to Carré, an absinthe that is an awesome portfolio finisher. Absinthe, jump barriers and dive into foreign markets. He notes while a traditional French concoction, has the distinct flavor of licorice there are obvious barriers of sizing, labeling, shipping, logistics, and a green color that comes from botanicals such as wormwood, and language, the biggest hurdle is finding quality distributors anise, and fennel, and is classically consumed with a Pontarlier overseas. “Our most difficult challenge has been the ability to glass, water, and an absinthe spoon holding sugar cubes that the identify quality distributors in each market that truly understand

liquid is poured through. “We were the second distillery in the the goal of the brand and company and are willing to be patient country to distill, bottle, and sell our domestically made absinthe and build awareness over time with the targeted demographic in the USA after its legalization. It has been very well received within their market.” Currently, Philadelphia Distilling has been

both on a critical level and consumer level. While the category is able to get its Bluecoat label to Australia, Bermuda, Shanghai, quite small, we feel it adds to our portfolio and works well with and a smattering of places across Europe. Auwerda confirms our flagship, Bluecoat.” While going out on a limb to create a that finding a local distributor is indeed the big challenge each spirit with deep roots and tradition, Auwerda said he would not time—and attracting capital for distribution. miss an opportunity or a great challenge like that of creating an

Reaching forward to overseas markets can be a challenge absinthe. “We feel it’s a great compliment to our portfolio and for anyone. Luckily, DISCUS and its programs have helped

Stock Inventory Custom Design Decorating Capsules Closures Corks

Y OU R C LE AR C HOICE F O R P R E M I U M PA C K A G I N G S O L U T I O N S

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Our only Craft IS PRODUCING THE FINEST ALL NATURAL CORKS IN THE WORLD

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Philadelphia Distilling bridge North America and export products distillers would tell you this becomes necessary as demand into foreign markets, gaining exposure through international trade increases and distillery growth cannot keep up. For the future, shows. Additionally, East West Advisors Group—also located in Auwerda wishes to expand the distillery and to continue creating Philadelphia—has assisted in their movement across seas. While amazing products. It’s important to raise capital and keep only five percent of their market is foreign currently, Auwerda building relationships with customers to gain more support and says, “We have established a firm margin for all foreign markets. growth for their distillery. While the gross margin is smaller than our domestic margin,

Auwerda also keeps active in the distilling community by

the net margin ends up about the same.” And if you’re seeking collaborating with other distillers and brewers—they are currently foreign markets, Auwerda advises, “Find the right partners! Be working on creating a whiskey with a brewery—and by creating patient and structure the agreement for a long term win-win dialogue with consumers to build support for their products. For relationship.”

SAILING THE SHIP FORWARD

the future, Auwerda has high hopes for Philadelphia Distilling. “I love the fact that no day is like the next or last. Every day presents new opportunities, new challenges and obstacles to go around.

Building strong business structures is important to Auwerda. I am fully motivated and feel bullish on what we have learned He believes in having rigorous quality control and high quality in the past and how we will tackle and win in the future.” ingredients. In house, Philadelphia Distilling does their own milling, mashing, fermenting, distilling, bottling, blending, Philadelphia Distilling is located in Philadelphia, PA. For more info proofing and labeling. Sometimes they do use GNS, but as most visit www.philadelphiadistilling.com or call (215) 671-0346.

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SCREEN FOR THE BEST EQUIPMENT MANUFACTURER FOR YOU HOW TO

WRITTEN AND PHOTOGRAPHED BY MAISIE MACKINNON


I

t’s not news to anyone that the

alone, the number of identified

“KNOWING WHAT YOU WANT CAN BEGIN WITH SIMPLE RESEARCH. DO YOU NEED A ROUND BOTTOM STILL, OR WILL A FLAT BOTTOM DO?”

distilleries has risen 250 percent,

— TOM BURKLEAUX, NEW DEAL DISTILLING, PORTLAND, OREGON

boom in craft distilling operations

across the U.S. has left industry suppliers of all types in a sellers market. In the past three years

going from 234 operations in 45 states in 2011, to nearly 600 in 50 states plus Puerto Rico, by the end of 2014. Companies new and established are stepping up to service the wave of

THE BEST QUESTIONS TO SCREEN FOR AN EQUIPMENT MANUFACTURER THAT’S RIGHT FOR YOU...

HERE ARE SOME OF

new distillers, often leading to lower prices, better access to equipment, and superior service. However, along with the wave rides the danger of exploitation; Less reputable forces looking to feed off the passion that accompanies the industry. Right or wrong, the burden of research falls squarely on the shoulders of the distillery owner. Prospective startups, and even those ready to expand, have to watch out for companies overstating their capabilities. “We got our license in 2004,” says Tom Burkleaux, owner of New Deal Distilling in Portland, Oregon. “Back then we had the room for everything to go wrong. But with the competition today, you have to limit your mistakes

“First off,” says de Amblia, “go straight to the owner of the company. Then ask questions that are open ended, not just ones that

get a yes or no. For example, ‘Can your equipment be expanded on?’ That’ll get you a ‘yes.’ The better question is, ‘How do you allow for expansion?’ This reveals more about their design process. Remember, you are looking for the quality of the answer, not just the answer itself.”

to succeed.” Know what you want before you talk to a manufacturer, he says. It can begin with simple research. Now,

what

questions

should

you be asking, and what research will provide you with the most effective decision making tools? “A manufacturer must understand the distilling process,” says Guinevere de Amblia, owner of Global Stainless Systems (GSS), manufacturer of

BEFORE YOU PICK UP THE PHONE AND TALK TO AN EQUIPMENT MANUFACTURER… KNOW WHAT FEATURES YOU WANT. Visit as many distilleries as you can. Craft distillers are a different breed. Most want to share what they know. Ask them what they would do the same or differently if they were purchasing equipment today.

distilling and brewing equipment in

TAKE A COURSE ON CRAFT DISTILLING. For

Canby, Oregon. “They don’t have to

example, the American Distilling Institute has

know distilling from top to bottom,

conference workshops, while Cornell University

but they better be able to address

Enology Extension, and Wisconsin’s Ethanol

the countless issues that come up

Technology Institute have full distilling programs.

Q.

Tell me about your experience building tanks and stills.

A. Time and experience equals skill, simple as that. The company’s website can tell you about their history, but you want to know about the craftsmen. You don’t want to hear, ‘I’ve been welding for 20 years.’ Specifically ask, how long have you been working with copper? With stainless? In other words, what kind of equipment have you designed and built over your career? It should involve tanks and stills, not just auto body work.

a system.” This includes layout to

GO TO THE TRADE SHOWS. It’s the best way to

Q.

heat source options, the distiller’s

learn from other distillers and to meet prospective

A. They should know the basics.

processing

when building a distiller’s vision of

preferences,

future

What do you know about the field of craft distilling?

manufacturers face to face. Plus, manufacturers

Building and designing an efficient

expansion and more. According to de

often have more time to answer questions at trade

system means understanding what’s

Amblia, your manufacturer should

shows than they do back in their over-busy shops.

in the distiller’s head, and bending,

be your best equipment consultant.

fitting and welding metal to meet that

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vision. A good fabricator will know how to streamline the building process because there’s a common language going on between them about the distillation process. An even better question is: How do you feel about the industry? Keep your ears open for excitement in their voice. This will tell you whether the fabricator is actually contributing well-built equipment to this successful and evolving trade, or just in it for the money.

Q.

I want to make whiskey and vodka and rum and gin. Can you build one system that makes all of those?

A. The word “craft” itself implies individuals thinking outside the box, and finding ways to make their recipes and processes possible so their results have their own mark. So while some distillers believe that one kind of still is best for one kind of spirits, others want diversity. The answer should be yes, we can accommodate that, and here’s how, and here is what it means for your products.

Q.

Will you charge me for the special design?

A. There should be no charge for simple modifications. More capacity and more diversity does means a bigger budget. But a fabricator who’s been in the business long enough will have already designed how to adapt the peripherals. For example, they will be capable of moving a botanicals basket inside or outside the column, or even how to make the side column attach or remove easily, depending on the need.

Q.

Can I get a detailed description of what you offer?

A. Every manufacturer should have a generic equipment list. It’s the combination of options that makes every system unique.

Q.

How does your product stand out from the competition?

A. This is a good question to ask other distillers before you connect with a manufacturer. Fabricators are known for their specialties, or their downfalls. That’s how reputations are built.

Q.

How will I know quality?

A. Quality in material is one thing, but quality in manufacturing is another. It lasts. Ask the builder what’s the longest running piece of equipment they have out there today, and for whom.

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Then go talk to them. You’re looking for what quality looks like to different distillers, not just one opinion. Ask what makes their system work, what doesn’t, what makes it window worthy and what they would do differently.

Q.

Do you manufacture all your products, or do you outsource/import tanks and stills?

A. A distilling system is either made in America as much as possible, or it isn’t. This doesn’t include small castings for smaller parts that, like electronics, are made all over the world. Today when companies state that their products are made in America, it means that they’re manufactured here with U.S. labor, creating jobs for our local, if not national, economy.

Q.

How much time should I allow for manufacturing?

A. Fabrication is measured in weeks, depending on the system. But what you’ll be up against in this wild upturn is the calendar. Good manufacturers may have to put you out three or more months. This is why it’s important to commit to equipment as soon as you can. You want it to come together so that when your license, permits and building are ready, your equipment shows up.

Q.

Do I need an overall consultant?

A. There are good ones out there and they are very expensive, top notch firms for big enterprises with million dollar-plus budgets. If you need help, pick consultants in their specialized fields, distilling, bottling/packaging, building, electrical, and so on. But none of them knows equipment like an equipment manufacturer. They should be your best equipment consultants.

Obviously cost is one of the largest parts of the equation, too. But the bottom line doesn’t always tell you the whole story about what you can expect from a manufacturer. Well-researched questions give manufacturers the accurate impression that you are a savvy, well-educated buyer who deserves expert advice, good customer service, quality custom-made systems they will stand behind—and a good price.

Guinevere de Amblia is President of Global Stainless Systems, Inc. in Canby, OR. For more info, visit www.globalstainlesssystems.com or call (503) 407-8514.

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y M t i u Q I w o H b o J e t a r o p Cor ke Whiskey a M to u

Why Yo

i

der H

Consi Should

Photos k le / / / n u R e ann n by Je Wr it t e

ntice

Appre n A g n iri

dtop b y Fo o

ia

didn’t initially set out to become a distiller, which I’m guessing may be similar to many of you. Stuck

in corporate America, with a job that everyone thought was “too good to leave,” I was well paid, had great benefits — and was soul-crushingly unhappy. A martial arts injury found me sidelined for a few months while

I recovered from surgery. It gave me the opportunity to slow down and look at the world, to see if I could find a new place in it. Who knew that would lead to my new career as an apprentice distiller? Two months after surgery, I launched a new website called LikeYourLiquor.com, dedicated to spreading the word on all the great craft spirits I’d discovered through my extensive research. I wanted people to know the story behind the bottle, along with the great hooch inside the bottle. I began writing a series on women in distilling for Women’s History Month in March 2014. One of my first interviews was with Troy Ball of Asheville Distilling Company. Six months later, I met with Troy and a group of

women distillers in North Carolina, as a spirits writer and event organizer. Taking the tour

of Asheville Distilling Company, I knew I , “I y a s d n ll a l on a sti with no forma wanted to do more than write about spirits, I d n a h y wanted to put my hand on a still and say, “I o put m whiskey.” But experience, t d e t n made this bottle of whiskey.” But with no I wa ottle of ager practical ess? b s i h t formal training and only meager practical made and only me busin e h t o t n experience, how was I going to get into the business? training I going to get i s how wa

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“Leap and the net will appear” is a quote by American naturalist, John Burroughs. I had the basics of a plan, but nothing concrete. And then a ten minute conversation with Ball forever changed my life.

A note from Troy Ball: I want to empower more women in the industry, and was looking for ways to do it. Working with Jeanne on the Dames of Distillation, I knew she was a “get the task done” kinda girl, with a good work ethic, someone who could wear any number of hats. An apprenticeship is a great way to bring on someone new. While there are some avenues for formal education, most training is hands-on, since each distillery is different. I took a chance, and it’s paid off for our distillery!

Ball mentioned she was looking for help at the distillery, and though I had no real experience, I asked her what it would take to be considered. Why not? The worst she could say was no, and I’d likely gain insight on what else I needed to do to become a more viable candidate. Troy commented that this job is very mechanical. In a previous life, I was a jet engine mechanic for the United States Marine Corps, which helped me bridge the gap in my distilling experience. I’d assumed the job would be very physical — distilling isn’t the glamorous job that Hollywood stars make it look like in commercials. But the satisfaction that comes from making something with my hands outweighs the tired muscles and occasional bruises that I have at the end of a production day. Was I perfect my first day on the job? Nope. Is anyone on their first day? I doubt it. I learned at least one thing new every day, if not five. Sometimes, I relearn yesterday’s new thing again since each day can be a little different. But I’ve also found that my experience outside the distilling industry has value, and can give a new perspective on things. Some say, “If it ain’t broke, don’t fix it.” Just because it’s not broken, doesn’t mean something can’t be improved! The first time I was left alone with the still was more than a little terrifying. Wait, what does that valve do? When should I turn the condenser water up? And

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So what’s

l of the the mora

story?

your team, y to expand a w t a re g u an be a re out if yo pprentice c way to figu t a re tion g ra Having an a a a p is ntice it of pre re b p p A a . e n a m ti g ll and bein b to do it fu veryone: your day jo it u q to t n rience for e a e p w x e e iv it e, it’s a pos the next thre will ensure omplish in c c a o to d g u in if yo n’t hop that? Even hat are you o d W to . e s c l ow la a p 1. Set go months? What plans are in ur distillery’s current team kn yo lve e may help six and twe this exercis , e c ti n re p p hire an a ing up. what’s com bjectives ow you’re o g n i n i a h ce, knowing y clear tr 2. Identif rements. As an apprenFtior me, my knowledge was l. u and measa big part of being successefuw in the right way? Giving e is n k p u at I manag measuring ack, and to applying wh I tr s n a o W e n l. o a c ry reti to keep eve largely theo k is the way c a b d e fe g and gettin ance. s of perform need your expectation ickly do you u q w Or is o H . ng i f the team? h o t r e y b r m e e v m e is -time Both 3. Timinbge up to speed and to be a fuitlle end to the apprenticeship?g your n to din apprentice o there’s a fi ye to expan e with an e portunity, s c p o ti n g Be sure re in p t. p rn n a e a e stud ing an g this a le ir e h ll o r c e h h it c e te , cal ve value ence to a lo avenues ha tical experi c ra p is headed. g ip in h s id v rentice p p a r team or pro u yo y a on which w you’re clear

now that I think about it, it was possibly as terrifying for Asheville Distilling Company: the new kid left alone with the still that keeps the whole operation afloat! But armed with extensive notes taken during training, checklists and of course, phone numbers in case I couldn’t figure it out, I successfully finished the distillation. While it can be nerve-wracking for everyone, it’s called hands-on training for a reason — you can’t learn until you do it. Life begins at the end of your comfort zone. Every day you wake up and can get out of bed is a day to make something happen. Whether it’s joining the ever-growing ranks of the craft distilling industry, or sharing the knowledge you’ve gained with someone who wants to learn — today’s the day you can make that happen.

Jeanne Runkle currently lives in San Diego, and is a craft liquor aficionado and freelance marketing expert. Her specialty is the brown stuff, whether it’s bourbon, rye or good ole American whiskey. She can be found at LikeYourLiquor.com, PancakesAndWhiskey.com or stalking the aisles of a liquor store, answering the random craft liquor queries of eager consumers.

C

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SAXTONS R I V E R

DISTILLING BRATTLEBORO, VERMONT

WRITTEN BY AMBER G. CHRISTENSEN-SMITH

T

///

PHOTOS COURTESY OF SAXTONS RIVER DISTILLING

he stories we hear coming from distilleries in the United

The pressure of survival caused his great grandmother to begin

States are always fascinating and unique. While some

distilling Krupnikas, a traditional Lithuanian honey liqueur. She,

elements are shared and build comradery, other pieces astound

with the help of her son (Stromberg’s grandfather), sold the illicit

and influence those dreaming of their own distilling business.

spirit in the Brooklyn area during a time of need. “This isn’t

The story of Saxtons River Distillery builds on that proud

some grand proud tradition, it was an illicit activity they did to

narrative of craft distilling.

survive”—but that moment of survival-inspired innovation was

Saxtons River Distilling is housed in the small and intimate town of Brattleboro, Vermont. It is here, in the southern part

what kept his great grandmother and her nine children afloat during a particularly difficult time in their lives.

of the state, that Brattleboro has evolved from a mill town

Jump forward one century. During a time where Stromberg

into more of an art-inspired destination that welcomes small

found himself not exactly in love with his job he departed from

business, innovative entrepreneurs, and art-minded individuals.

his mill occupation and decided he needed to make his own

Christian Stromberg, owner and distiller, didn’t directly find

way. Stromberg happily shares, “What my careers taught me

himself in distilling, however. He made a living as an engineer in

is running a distillery is a lot more fun.” Relying on his family

a steel mill, among other various occupations, in this beautiful

tradition of making Krupnikas, Stromberg took this recipe and

area of Vermont. Yet as in so many stories, distilling was in

found a way to use Vermont maple syrup instead of honey, and

the blood. Stromberg’s family had a long tradition of distilling

he created his first spirit—the Sapling Maple Liqueur.

rooted in their heritage, and necessitated by his ancestors need to support a large and growing family.

Stromberg was soon up and running with a uniquely innovative product. From there, Stromberg has created a Sapling Maple

His family immigrated to the United States from Lithuania, in

Bourbon and a Sapling Maple Rye that are both aged in

order to escape the Czar’s control in the early nineteen-hundreds.

American Oak barrels, and a Perc Coffee Liqueur that utilizes

The family quickly assimilated into the American lifestyle, and

Arabica coffee beans that are roasted locally by Mocha Joe’s

were able to make a living in coal mining. But tragedy struck

Roasting Co.

when Stromberg’s great grandfather passed away, leaving his

Stromberg definitely knows how important staying local is. He

great grandmother to fend for herself and her nine children.

has a background in industry supply chains and he knows how

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“We can’t get everything here locally, but we hope to develop farmers’ capabilities as we progress. To some extent they’re willing to grow it if we’re willing to buy it.” — Christian Stromberg

to navigate these waters in order to keep

other’s products and in passing laws such

his process tight. Also, local agriculture

as onsite tasting.

and suppliers of all kinds are always his

Stromberg has found great support

first choice when possible. “We can’t

in his community. “We sold out the first

get everything here locally, but we hope

holiday season in 2007, and we’ve had

to develop farmers’ capabilities as we

great support since. Locally we’re a go-

progress. To some extent they’re willing

to place for bringing visitors.” And in

to grow it if we’re willing to buy it.”

finding great support, Stromberg stresses

Additionally, he adds, “I have found that

the importance of supporting other great

keeping your supply chain short is the

craft distillers and working together to

best way to maintain control. If you miss

collaborate. “We’re a cool part of the

a piece of the chain it all falls apart.”

industry, and together we can get the word

Saxtons River Distillery advocates for

out that there are other ‘little guys’ you

innovation and movement in Vermont for

should try and buy.” Another thread in the

craft distillers. “We created a Distilled

powerful and unifying narrative of craft

Spirits Council of Vermont which I

distilling.

led when we started.” Together these distillers work for common goals to move legislation in the right direction. They work as a community by selling each

Saxtons River Distilling is located in Brattleboro, VT. Call (802)-246-1128 or visit www.saplingliqueur.com for more info.

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BECAUSE WHO DOESN’T HAVE AN EMAIL ADDRESS

?

WRITTEN WRITTEN BY BY KATE KATE CARDINALI CARDINALI

W

hy is email marketing even important? Pay attention, now. Picture a large room, jam-packed with people.

When asked, “Who has a Twitter or LinkedIn account?” a few hands go up. “Who uses Facebook?” a lot of hands go

up, more than half. But when asked, “Who has an email address?” every hand in the audience goes up. Every hand.

WRITE A NEWSLETTER TO EDUCATE AND GIVE YOUR READERS INFORMATION THEY CAN USE.

100%. Want to reach clients and potential clients? Email marketing. Again, why? Marketing is often a closed-door, behind-the-scenes…sneak attack, so to speak. Consumers are lured in. It’s important for you to use a different path. An amazing thing about email marketing is that it creates an absolutely vital marketing tool: inbound

marketing delivers 54% more leads than traditional methods.

STRATEGY Write a newsletter to educate and give your readers information they can use. Also note that sharing personal stories about staff and production are also great angles of distributing information. Brainstorm a running list for all of the topics you want to cover over a 3-6 month period. You will then have a focus of the information that you need to gather to reach deadlines. Here is a short list of topics you can have a whole newsletter focused on: recipes, pictures of cocktails, feature photos that your followers tagged you in on Instagram, recent awards or write ups in the media. (Just get your creative juices flowing!) You know best what the focus of your brand is; share that with your followers. Equally important, however, is that your company’s newsletters are executed properly – and drive readers from social media sites and inboxes to your website. So how do you do that? Read on…

Much like distilling a great product, e-newsletters only work if you follow a specific recipe:

1) CATCHY SUBJECT LINE: 3 – 8 words. Never more than 8. Short, enticing subject lines, ie: Cover Your…Assess Your Spending.

2) ENTICING INTRO: Inside the body of the newsletter: Set your intro at 25 words, the sweet spot. Tease them, and then give them a link to your site where they can read the rest of the story. The intro should grab your attention, inform, and entice them, so that they’ll…

3) CLICK HERE: Click the link to your site. The catchy subject, the enticing intro…all leads to bringing your readers away from your email and to your website. Include the proper links so this happens.

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CREATION So how do you get started? As we had mentioned above, your brainstorming is key. As you are brainstorming, take these things into consideration:

PROVIDER: Use a provider to help you manage your newsletter. (ex: MailChimp, AWeber, Constant Contact and many more!)

TEMPLATE:

It needs to be mobile friendly and one column. Set it up so there are 2-3 sections that all start with 25 words, and then give them a link to a send them to your site.

CONTENT: When you develop content for your newsletter, you are also developing content for your blog. Newsletters and blogs are valuable methods of creating ever-changing content for your website, which in turn promotes search engines finding you – and ultimately drives traffic to your site.

EYE-CANDY: For the pure joy of photos, include photos. But, also remember: 65% of people are visual learners.

PERSONALITY:

Let people get to know you. Your email marketing should give readers chances to know your

company’s charm. Share stories about the office dog, the owner’s rusty blue truck (and why they love it), and be personable.

CONNECT: Once you have developed these stories, make sure you are getting them to your audience. Share, share, share!

LINK: Be sure to include embedded links in the body of your newsletter to get them to your website. Successful email marketing should draw readers to your website, offer useful information and create invitations for longer visits.

MANAGEMENT As you are developing content for your newsletter, don’t forget to take out bits and pieces to use for other channels of reaching your target audience. Use this same content on Facebook, Twitter, Instagram, etc. Pay attention to your open rates. What types of topics and subject lines get opened more than others? Use this information to go back to your future planning, and make decisions based upon what worked or didn’t work in previous publications. Because the ultimate goal of content marketing is lasting,

86 WWW.ARTISANSPIRITMAG.COM


continuous engagement, it requires a long-term commitment. Content marketing may take longer to convert leads, but over time, it significantly drives down conversion costs.

E-NEWSLETTERS CANNOT BE IGNORED. THIS KNOW-HOW IS CRITICAL FOR THE FUTURE SUCCESS OF ANY COMPANY.

DISTRIBUTION Send out a newsletter twice a month. It doesn’t have to be drawn out and lengthy. It needs to act as a point of contact from you that makes your followers feel engaged.

with incentives (monetary or accolades) that encourages the collection of new subscribers.

As you interact with people at tasting events, conferences,

BOTTOM LINE: E-newsletters cannot be ignored. This know-how

your tasting rooms, or even distributors, collect their emails.

is critical for the future success of any company. Keep note

Add them to your distribution list. A simple interaction of, “We

that as trends change, and they will, and opportunities arise, be

have an amazing newsletter that makes you feel part of the

willing to take the leaps of faith and make the changes necessary

(company name) family. Do you have an email that you would

to truly use this tool to your advantage. If you need help with

like to share to become part of the family?” or “We know you

direction and focus, contact someone that has experience doing

love our products, we have a newsletter that includes recipes,

email marketing. There is no shame in asking for help when it

photos, and fun stuff that happens at (company name). Would

turns your efforts into profits. Happy planning!

you like to join?” Whatever you choose as your company mantra for getting people on your newsletter, make sure that all staff members are on board. Consider having a monthly competition

Kate Cardinali is owner of Innovative Media Design. For more info visit www.imdesign.me or call (989) 402-1199.

WWW.ARTISANSPIRITMAG.COM 87


A FIRST-TIMER’S

A D I C O N V E N T I O N R E C A P W R I T T E N BY H A R RY H A L L E R

///

I L LU S T R AT I O N S BY D I E T M A R K L E I N

My editor says I need to introduce myself and explain why I went to the ADI Expo and Conference. My name is Harry Haller, and I co-owned a cachaça distillery in Brazil, selling it last year with the idea of setting up shop in the US. As for the why of my trip, I wish it was because the ADI expo is the single-most comprehensive all-inclusive craft distilling event offering unprecedented ease of access to

meet

manufacturers,

suppliers, advisors, and even the TTB, while also providing an impressive lineup of seminars held by the brightest and best in the industry. In reality, my reason was a side effect of doing business with Pakistani molasses sellers. Planning my trip to Karachi, they suggested it might be more convenient if we met in Kentucky. Since I knew nothing about the expo at the time and was unable to conceive of even the wildest of reasons why Pakistani molasses sellers would ever find themselves in Kentucky, I Google translated their e-mail into Urdu then back into English hoping for some clarification. I got “This is known as the Kentucky State may agree to face his face.” Fingers crossed, I did it again and got, “It may agree to face his Kentucky” and then I don’t know what I pressed but, “This verse may fall if the wells were fky” popped onto my screen which had me sold. The possibility of seeing a “verse fall” sounded like as good a reason as any to go to Kentucky. And if by “wells fky” they meant having my entire perspective of this expo and its role in craft distilling twist upsidein and outside-down then I got exactly what was promised.

Day One I had arrived too late the day prior to check in at the convention or even go to Moonshine University’s welcoming party. I was also late enough to get railed on by my airbnb host for the forty minutes I kept her waiting. Signing in at the expo was a breeze. I was given a bag of goodies and a booklet listing everything an attendee would need to know, from seminars to vendors to where each vendor was seated to a list of places in town one could

“take

advantage

of

Special

Offers!” simply by showing their name

“I was profoundly confounded and thoroughly mystified by the sheer number of bottle suppliers, label designers, and cap / cork sellers in attendance.”

88 WWW.ARTISANSPIRITMAG.COM


badge. Bad news for the restaurants on the list since the food at the convention was exceptional. I actually felt guilty by the amount I consumed, an emotion only trumped by the realization that my gluttony had made me half an hour late to my molasses meeting. Arriving at the hotel, however, I was told they had not yet checked-in. A delay in Dulles or Dallas, either way they weren’t here and wouldn’t be for a while. Gifted with a few free hours I decided to take a walk around the expo floor. The layout was as expected. Perfectly organized rows predictably lined with one booth after the next. My reaction after walking the room, however, came to me as a complete surprise. I was profoundly confounded and thoroughly mystified by the sheer number of bottle suppliers, label designers, and cap/cork sellers in attendance. And when I did the math, I even felt somewhat sorry for them. Sixty-two of 140 vendors — over 44 percent — all dressed up for the grand event only to see other guests walk in wearing the exact same gown. My second reaction was actually a reaction

“The ADI convention was a place to be able to gather information and begin to realize what this industry really is and in what direction it ought to be heading.”

to my first reaction. There was absolutely no good reason why I should have been even the slightest bit shocked. I’d grown

Bixby’s “Low Energy, Low Maintenance

Big Four Bridge to Indiana, then back

evermore concerned that packaging and

Wastewater Treatment” lecture. Each

to Kentucky, then back to Indiana, then

presentation

becoming

gave me something new but the seed

back to Kentucky where I strolled around

more important to craft distillers than

which really took ground was mention of

downtown Louisville hoping to find the 30-

the quality or taste of the products they

Gas Chromatography Mass Spectrometry

foot tall golden replica of Michelangelo’s

made. This headcount should have been

(GC/MS). Beatty framed it as an incredibly

David. Failing to do so I sat on a bench

my vindication, something I ought to have

precise method to qualify, identify, and

near the Ohio River and looked over the

embraced as affirmation of my hypothesis.

categorize your distillate.

vendor’s list choosing the ones to meet

were

quickly

My meeting contingent had finally

and get to know in person. I started with

I was not.

arrived. It was already evening and they

China-based still manufacturer Dayeoo

A change of flavour was needed so

looked exhausted. We decided it best to

(pronounced “Day Oh”) Tech Co. I played

meet the following afternoon.

them the 1956 original recording of the

I ought to have been proud.

I went for a seminar. I chose “Quality Control of Distilled Beverages” with Gary Spedding and Matt Linkse. I stayed on for

Day Two

“Banana Boat Song” thinking they’d get a kick hearing their company name

Chris Beatty’s “Better Drinking Through

With two hours to spare before the

zealously emoted by legendary crooner

Chemistry.” And I finished off with Julie

expo doors opened, I walked over the

Harry Belafonte. “It sounds special,”

WWW.ARTISANSPIRITMAG.COM 89


was the sum-total of their reaction.

Once again GC/MS came up but Davis had

Both addressing in their own way the

Stopping in on nine of the other 13 still

turned this analytical tool into a weapon

business that is craft distilling. A young

manufacturers left me emotionally at the

of mass creation. On the escalator down,

business. A unique business. One where

exact same spot I’d found myself the

I got talking about yeast with Pat Heist

missteps have already been made but

day before. A worse spot, actually. Not

of Ferm-Solutions. What he had to say

none big enough to affect the exponential

only were improvements to their design

was engaging enough but the way he

growth projected for the coming years.

purely aesthetic, they were using the

spoke (a mix of scientific precision and

A business where extreme optimism

concept of “tradition” as justification for

cowboy enthusiasm), made working with

abounds.

maintaining archaic technology. Whatever

yeast seem like the sexiest thing in the

The ADI convention was a place to be

happened to advancement? Yes, there

world. One hour later, my meeting with

able to gather information and begin to

were exceptions, but had the invisible

the molasses sellers was over and I left

realize what this industry really is and in

“Push For Pretty” transcended packagers

their room with a contract signed and a

what direction it ought to be heading. Craft

and labelers, shoving its demands onto

care package holding eight vials of their

distilling is not a vanity industry. A nice

engineers and coppersmiths, as well?

product.

bottle and label and a stunning copper

The room began to warp. Booths housing advisors taunted me with proclamations

still will only get you so far. Craft distilling

Day Three

is also not craft brewing. You can’t whip

of “image is everything.” Even the

I took a cab to the airport. Working

up a new type of rum like you can a new

handful of companies innocently peddling

away, trying to peel the wet pages of my

type of beer. Ageing is the foundation for

flavouring and essences now seemed to be

notebook apart. The night before ended

flavour. And as much as purists hammer

propositioning Faustian offers promising

with me being good naturedly pushed

on about tradition, the future cannot

instant product differentiation through

into a pool by several new comrades from

ignore today’s minutiae. And, no, I am

colouring and corn-syrup. It was as if craft

the convention. I soon gave up, accepting

not saying we hand the keys over to the

distilling had decided to present itself as

that I was holding nothing more than a

men in the lab-coats. The future is in

cosmetics you could drink.

wet rectangle of illegible thoughts, vastly

finding that delicate balance between the

I sought refuge in the seminar area

contradicting yet totally fused into one. A

new techniques and technologies being

by way of Gordon Biersch — where I

perfect metaphor for my trip which made

taught in the seminars upstairs and the

had the bartender pick a bourbon with

it exactly the one metaphor to avoid.

over 4,500 years of distilling experience

specific instructions not to share the

The ADI Expo and Seminar was not

story written on the bottle. Calmer and

meant to be a reflection of the craft

slightly numbed, my feet carried me to

distilling industry. It was a meeting place,

Bryan Davis’s “Demystifying Oak Ageing”

a learning place. A two floor ordeal with

lecture. Davis was as brilliant as he was

vendors on the ground level and speakers

charming. If Steve Jobs were alive he

upstairs. A university on top of a bazaar.

would have killed himself out of jealousy.

already being sold by the vendors on the floor below.

Harry Haller is an independent consultant focused on working with sugarcane-based distilleries. He can be reached at 00harryhaller@gmail.com or (310) 933-6430.

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Your Ideal Package, From Concept to Reality

90 WWW.ARTISANSPIRITMAG.COM


ACT II:

NOW WHAT? t

SUPPORT STRUCTURES & INFRASTRUCTURE Where are the next opportunities for investors in craft distilling? he Craft Distilling movement has established itself as a viable

WRITTEN BY RALPH ERENZO

emerging industry. The proof of concept is obvious. In spite

of the difficulties of competition, regulatory obstacles, dearth of

they want to know

information and the strangeness of the new, experimental spirits

where their spirits are

to consumers, Craft Distillers are now a serious part of the spirits

coming from and who is making

business. The typical producer is no longer the mega distillery

them, without the traditional heavy handed hype for which

owned by international corporations whose only connection to

the major brands are famous. The Craft producers have

the consumer was the spinning paid media. The small privately

fabricated a new paradigm.

owned and operated regional craft distillery is the new normal.

And now the bad news: we’ve all built this terrific vehicle

And the proof is in the hijacking of catchphrases like craft and

for change and success, but the highway system we need

handmade by the big guns.

to get that vehicle up to a comfortable cruising speed has

In 2003 there were approximately 10 craft distillers in the US. This year that number is expected to pass 700. The

yet to be built. The lack of infrastructure for the craft industry is holding back its maturity.

reasons are clear. Law changes have made small distilling more approachable for the entrepreneur. The early adopters who jumped in and produced excellent spirits

So where is the greatest opportunity for those who want to get a piece of the action? It’s in the industry which supports the efforts of the craft distiller.

have demonstrated the success of their efforts and are beginning to dominate the shelves of retail shops and cocktail bars. Banks and investment firms are paying attention, making capital more readily available. Wells Fargo has established a whole division to study funding opportunities of craft distillers. The public has come to appreciate the difference between the major players and the rookies who are hitting home runs. And consumers have developed a thirst

for

“authenticity”;

The next wave of development will include: increased capital for startups which will mean startup

distilleries

with

greater

capacity.

Consolidation of distilleries as investment groups

acquire

desirable

distilleries

(successful and failed) and take advantage of

increased

economies

of

scale.

Entrepreneurs will begin to develop such supporting industries as malting facilities and cooperages which are necessary to the distiller and avoid the regulatory morass entirely.

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“ In order for the craft distilling

industry to prosper it needs the supporting industries: the cooperages, the malt houses, the engineering that supports the growth, experienced staff and Entrepreneurs management.” and distillers will

venture

I suggested opportunities including: building regional distilleries with increased capacities of 100,000+ proof gallons a year at the start up; service industries providing goods and services to the small distiller (computer software, scaled equipment, distribution services, staff education, etc); growing market for specialty grains; engineering such as small scale waste treatment and energy generation; acquisition of successful distilleries and brands, or of failed operations. The logic is simple. By way of analogy, if I were going to break into the computer business now, starting from scratch, I would not start out by introducing what I believe to be the next new most powerful, lightest computer. I’d make the “on-off” switch every computer needs regardless who is manufacturing it. So

into

no matter how the computers with my switches are marketed,

export, supported by ex-

successfully or not, the maker still needs to buy my “on-off”

US importers who consolidate

switch.

shipments to open markets which desire the

The situation is not so different for the incoming investor. In

new American spirits. States are investing in the industry as

order for the craft distilling industry to prosper it needs the

they see the increased tax revenue and new job opportunities

supporting industries: the cooperages, the malt houses, the

craft distillers offer. Legislators realize the potential benefits to

engineering that supports the growth, experienced staff and

their constituencies which are offered by the success of the

management. These investments are less subject to the whims

regional distilling industry, and amend law to accommodate the

of the consumer or mistakes of startups’ management.

industry. And engineers will develop energy and waste solutions

One of the most critical needs for the industry as a whole is

for the small facility, thereby saving the craft producer money

the need for qualified staff and management. We’re nearly all

which can be reinvested in their operations and people.

journeyman at this craft, learning to run our businesses and

Example: In New York State Farm Distilleries and Farm

in the meanwhile producing. There is a notable lack of skilled

Breweries are given substantial latitude in the marketing of their

staff. Training programs are cropping up nationwide that train

goods. The Farm Distillery license has a greatly reduced permit

distillerymen, bottling crews and sales staff. But where are the

fee. The licenses come with a requirement to use New York

qualified managers? Where are the bookkeepers, compliance

grown raw agricultural materials in their production (Distillers

personnel, plant managers, CEOs who can stabilize operations

– 75%, Farm Brewers – 90%). There are 70 distilleries in New

and convert energy to profit going to come from? The poaching

York, and over 128 craft brewers. But there is no commercial

has already begun as growing distilleries are reaching out for

malting operation in New York. This song is echoed nationwide.

qualified staff and management already employed by other

All the malt used by distillers and brewers comes from out of

distilleries. The injection of capital resulting from the success

state or is imported from Germany or Canada. New York State

being enjoyed by some operations allows them to steal qualified

has begun a state funded barley project to teach growers

employees away from the struggling distillery with fatter salary

how to select seed and grow barley. But still, no malters.

offers.

Distillers enter the business for many reasons: love

Craft distilling has come a long way. It has proved itself as

of spirits, love of challenge, family heritage, a love

a viable business opportunity. It creates job opportunities and

of farming, and some just because it’s high on the

profit potential. But the full blossoming of the industry requires

“cool scale”. But at a recent investor’s summit in

a support network on a national scale. From where I sit, the

Santa Monica, I spoke with investment capital

curtain is going up on the second act in this drama.

firms and bankers who asked, “What’s in it for me?”

Ralph Erenzo is co-founder of Tuthilltown Spirits in Gardiner, NY. For more info visit www.tuthilltown.com or call (845) 255-1527.

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F F O O E E T T A A SSTT

N N O O I I N N U U E E TTHH R E P A P E T I H W Y R T S U D

N I D E T S UPDA

’ K C I L T INS

K L E A H MIC

T WRIT

Y EN B

AE MICH

S L KIN

TLIC

K

INTRODUCTION The Craft Distilling market in the United States is no longer a quaint

curiosity, but is front-and-center and driving some of the

most important trends in the market today. Spirits have been enjoying a resurgence from the “Sex in the City” and “Mad Men” cocktail–fueled lifestyle dramas

leading to trendy mixology lounges now appearing across the country. Although still small as a proportion of total volume and sales, both breakout products like Tito’s Vodka, and innovative firms like Leopold Bros, Corsair Artisan, and my own Coppersea Distilling are redefining the US spirits landscape. As

described

in

previous

editions of this paper, the number of Craft Distillers is doubling every 3 years, and this trajectory held true in 2014 as well. We identified

588

CHART

TAL 1 — TO

IN-PRO

DUCT

AFT D ION CR

ISTILLE

RIES

in-production

craft distilleries at year’s-end 2014,

including

116

new

entrants. When the first edition of this White Paper came out in 2012, those 2011 numbers were 234 total- and 42 new- entrants (since revised upwards). With 588 Craft Distilleries in production and over 100

“legacy” production

LIC A — US

2 CHART

ENSED

DISTIL

SINC LERIES

E 1880

operations,

we

can

say

that

firmly the

number

of US production distilleries is now higher has

than been

it since

Prohibition. As

Chart

2A

shows, the US once had

thousands

(and, earlier, tens-

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of-thousands) of small distilleries across the country before the forces of mass production and Temperance drove them under.

2B — CHART

How many distilleries will the

NEW C

RAFT

LERI DISTIL

ES BY

INIT

ODUC IAL PR

TION Y

EAR

market support? There are now over 3000 Brewers and 8000 Wineries. We have always believed that our methods understate the true numbers due to the “hidden entrant” problem. For example, last

year

we

identified

425

entrants as-of 2013. Our latest count shows the number to be 472, and the final count will

Another way to track the growth of the market is to look at

certainly still rise slightly. Last year’s “new entrant” count stood

the entry rates of listed firms in the annual ADI Directories. In

at 74; we now see that number at 103. Certainly it appears that

each year’s listings there are some firms already producing and

the market took a “jump step” in 2012 to over 100 entrants per

other prospective entrants who have not yet fully committed to

year and shows no sign of slowing down.

starting production. Some of these “pre-producers” are licensed, equipped, and almost producing;

3— CHART

P

TION RODUC

CRAFT

D

RIES ISTILLE

VS. AD

IE

NTRIES

others

are

nothing

more

than

dreamers who may never get farther than their “under construction” listing. Each Directory has a one year lag; that is, the Directory published in 2014 is as-of 2013, etc. As Chart 3 shows, the percentage of Directory-listed firms in the market over time is remarkably consistent. We can be reasonably confident that 100 or more of the 2013, 2014, and 2015 Directories listings not in the market as-of 2014 are already “waiting in the wings.”

2010

2011

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2014 CRAFT DIST

CRAFT DISTILLERIES BY STATE

ES BY ILLERI

STATE

52, respectively, continuing to combine for almost 1/3rd of the

The top states for new entrants in 2014 included Washington, which continues to extend its leading position, California,

producers. Adding in the “next 3” Oregon, Colorado, and Texas gets to 50% of the nation’s total of 588.

enjoying an upswing, and Pennsylvania, a historically important

Comparing the map to the last few years, however, reveals

distilling state now flexing its muscles again. But the breadth

the growth across the country, with solid increases in the

of growth was what really jumped out in 2014, with 12 states

Midwest (Ohio, Illinois, Michigan, Wisconsin, Missouri) and

featuring growth of 4 or more distilleries (versus 8 in 2013 and

South (Kentucky, Tennessee, Florida, North & South Carolina).

6 in 2012).

Alabama, Oklahoma, and New Jersey have been added to the

Washington continues to lead the nation and now has 74 craft producers. California and New York are close behind with 57 and

2012 WWW.ARTISANSPIRITMAG.COM

states with an operating Craft Distillery, and North Dakota should be “on the list” in 2015.

2013 95


CHART

PRO 4—%

DUCER

S

BY E G O RY IN CAT

E N T RY

YEAR

scratch” start-ups. This accounts for a large part of the decline in the “Other” spirits category. The rise in “Whiskey” is part of the resurgence in brown spirits that has been going on for some time with the “Mad Men” influence on the Millennial Generation and the emergence of classic cocktail culture. American whiskey has started to have its “Single Malt” moment.

COMPARISON WITH CRAFT BREWERS Chart 5 overlays the number of each type, Microbrewers and Craft Distillers, from the “founding event” of each industry. For the Microbrewers, Anchor Steam, (re-)founded in 1961, is deemed to be the “founding event,” and for the Craft Distillers, the 1982 entry of Jepson Spirits and Germain-Robin. The number of Breweries in the United States is at an alltime high, and micro-brew beer continues to take market share from the large brands. After a modest dip in the mid-00’s, the

CRAFT DISTILLERIES BY PRODUCT TYPE

number of Microbreweries itself has grown by over 1000, or

As was noted in the original full white paper, the new craft

80% in the past 5 years!

distilleries are making a wide variety of products. Many start

That kind of growth makes the numbers in the Craft Distilling

with traditional “white spirits,” Vodka and Gin, while also

market seem like the stuff of hyperbole or fairy dust: 311%

making Whiskey for aging. Vodka remains a popular category,

growth in 5 years. That is not a typo.1 And the Microbrew

with roughly 50% of new entrants offering one. Rum has been

market was showing similar numbers at the same phase of its

fairly consistently a product-of-choice for about 25% of new

development. The Craft Distillery market continues to double

entrants, and, likewise, Gin has remained in the 30% range.

every 3 years, and, should current growth rates continue, the

The largest shifts have come in the Whiskey and “Other” categories, this last encompassing Brandies, Cordials, Agave

number of Craft Distilleries in the United States will be over 1000 within 3 years.

spirits (“Tequila”), Aquavit, Eaux de Vie, Arak, and other unique spirits. More of the early entrants were already-existing farm wineries than more recent entrants, which tend to be “from

5— CHART

1

CRAFT

DIS

IES V TILLER

S. MIC

ROBRE

W

Michael Kinstlick is CEO of Coppersea Distilling. For more information visit www.coppersea.com or call (845) 444-1044.

BY IN ERIES

DUSTR

Y AGE

In 2008 the number of Craft Distillers in the US was 143. In 2013 it now stands at 588. (588-143)/143 = 311% growth.

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BLACK BUTTON DISTILLING:

A

YEAR ONE

WRITTEN BY JASON BARRETT, OWNER/HEAD DISTILLER

I

t’s hard to believe it’s been just 18 months since we fired up our still at

Black Button Distilling for the first time,

THE YEAR AT A GLANCE:

REVIEW

PHOTOS PROVIDED BY BLACK BUTTON DISTILLING

PASSIONATE PEOPLE:

Growth hasn’t come

easy and many long nights and hard-won fights have led us to today. I feel very blessed to have some of

becoming the first grain-to-glass distillery in

210 BARRELS OF

BOURBON WHISKEY

the most passionate coworkers I could hope for at

Rochester, NY since prohibition. Now, less

DISTRIBUTION IN 7 STATES

my side. Each of them left a steady job that usually

than two years after we opened our doors, we’ve signed a lease for new warehouse

200 ACCOUNTS

space after outgrowing our 5,000 sq ft of

21 EMPLOYEES

space, and we have a 600 gallon stripping still on the way as our 300 gallon still wasn’t enough to keep up with demand. As I look back at what we’ve accomplished, it’s been a truly remarkable journey.

AND COUNTING

INSTALLED GRAIN SILOS AND NEW FERMENTERS LAUNCHED 14 NEW PRODUCTS

paid better to join me in this journey. It’s through their efforts that we have been able to grow our selfdistribution operation to over 200 accounts and our distribution partnerships to cover seven states. Employees make or break you. Make sure everyone is on the same page; we are a functioning team as well as a family. When we work together as one unit, creativity flourishes and solutions are found. Their

WWW.ARTISANSPIRITMAG.COM 97


passion rubs off on you as well as the customer. The passion is what keeps the gears turning at 1 o’clock in the morning.

INNOVATIVE PRODUCTS: Almost all cocktail lovers have had a Manhattan and a Gin & Tonic. How can we put our own NOW PROVIDING DISTILLING EQUIPMENT FOR ALL SIZE PRODUCTION FACILITIES. PLEASE CALL TODAY FOR MORE DETAILS AND PRICING ON EQUIPMENT.

spin on that? We created an in-house Black Button Manhattan and released seasonal gins, which turned some heads.

RISING TIDE: Seek out partner breweries and wineries and even other distilleries to work with. We are one functioning unit working to give the public a product that has its own uniqueness separate from what everyone is used to. It’s mutually beneficial.

DISTILLING EQUIPMENT BOILERS • BREW HOUSES CELLAR EQUIPMENT TANKS • REFRIGERATORS FILTERS • PUMPS FILLER MONOBLOCKS SCREW CAPPERS COUNTER PRESSURE MONOBLOCKS LABELING MONOBLOCKS MOBILE BOTTLING SOLUTIONS

CONSIDER COSTS & EQUIPMENT: When we only bottled 900 bottles a week our hand crank labeler worked well. Now when we sometimes bottle five times as much, it’s a painful constraint and there is nothing like an 18 hour bottling day to really mess up your week.

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But to step up to the next size is at least a $10,000 to $18,000 proposition. And it’s not just labeling. Filling, hand-capping, and even mashing are all starting to feel very constraining. Growing a distillery—like any business—requires a keen look at cash flow. We found a harsh reality: there is not much equipment out there for mid-sized guys and even less of it is used.

LESSONS LEARNED:

From “White Dog”

» » Two medium stills would be better than one big one because you can strip and final rectify all at once. That flexibility is so valuable.

To Single Malts To Strait Bourbons.

» » You don’t need three-inch mash hoses, two-inch will do

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just fine. Close your eyes and visualize the equipment you are using. Is it too heavy for one person to comfortably handle it? If so, it’s going to slow you down.

TELLING THE BLACK BUTTON DISTILLING STORY: There is no cookie cutter approach to craft distilling, as it

F R E S H APP R OACH NEW BRANDS & A

TO

B UI L DI NG

BUSI N ESSE S

I N F O @ S P I R I T S C O N S U LT I N G .C O M

212.292.8193

S P I R I T S C O N S U LT I N G .CO M

should be. People do not want to be sold something. They want to be told a story. The experience in our tasting room explains our story and our process, it allows us to connect with the public in a truly unique way.

» » Investing in branding and high quality packaging is a must. It tells our story and ties it with branding/business.

» » Brand ambassadors/advocates are key. Our followers are loyal and their voices carry in this town. This has created an excellent echo chamber of success.

» » Advertising is more expensive and less effective than I would have imagined. We are in an extremely innovative,

98 WWW.ARTISANSPIRITMAG.COM


creative industry. Thus we are finding unique ways to catch people’s attention.

» » Online marketing and social media are a great way to reach your demographic. Again, when you give the city a quality product, they will brag about it to everyone (echo chamber). They are our Black Button Ambassadors and word of mouth is a vital aspect of our success, as well.

» » PR is huge. Creating conversations and beneficial relationships and providing Rochester with alternatives to their usual cocktails is extremely important. Creating a sense of community around our brand makes us a very likable company.

MANAGE AND MAINTAIN GROWTH: The 210 barrels of bourbon aging in our warehouse today represent a huge investment on the part of our company and the payoff is still years away. While year one was mostly about scaling our manufacturing capacity and capability, year two is shaping up to be an exercise in growing sustainable and consistent sales. Each market has its own quirks and each account has it’s own needs. As you grow, managing each of these requirements becomes an ever-increasing project and you need more hands to manage it.

WHAT WOULD WE DO DIFFERENTLY? » » Larger tasting room. It’s all about the experience. Giving our consumers multiple opportunities and giving them more space to have the “Black Button” experience is important and would serve us better.

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» » Wouldn’t make vodka, just focus on gin and whiskey. The world doesn’t need another vodka. Gin and whiskey have the opportunity for much greater variation of taste and in essences adding something to the conversation.

» » Put more bourbon down the day we opened so we would have more now. If you never make the investment to lay it down you never get to reap the rewards of selling it. In the end, hard work pays off. The late nights, the phone calls, and even the headaches are all worth the success in the end. This is an exciting industry to be in right now and it is worth the fight for us. We’re proud to be a growing New York

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state craft distillery and we hope you’ll follow our story as we Live Large in Small Batches.

Jason Barrett is owner and head distiller of Black Button Distilling in Rochester, NY. For more info visit www.blackbuttondistilling.com or call (585) 730-4512.

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WWW.ARTISANSPIRITMAG.COM 99


TEQUILA 101 WRITTEN BY AMY BROWNSTEIN & LISA BARLOW

W

hen you think of tequila, what comes to mind? For many

rich in minerals and are thus prime areas for growing agave.

people, it’s the old saying: tequila makes your clothes come

Crops grown at high altitude in red soil often produce a large,

off. However, cheesy marketing sentiment neglects to show

sweet, flavorful piña (core of the agave plant) with which to make

the historic and detailed process of creating tequila, one that

tequila. On the other hand, agave plants grown in the lowlands

frequently results in a classic sipping alcohol that will ensure

yield tequila that tends to be more herbaceous and earthy. The blue agave plant has a single lifespan; it can only be

your clothes stay on. For centuries the Aztecs drank the fermented juice of the

harvested once. After it is cut, a new one must be planted in its

agave plant for religious and curative purposes. The agave plant

place. The blue takes up to 12 years to reach full maturity, and

is widely held to be a gift from the gods and is used to produce

premium tequila will often take 16 years to produce.

tequila. Contrary to popular belief, the agave plant is a relative of

Agave plants require lots of attention and nurturing. Secrets

the lily, not the cactus, and is actually classified as a succulent.

and knowledge about caring for and harvesting agave plants are

GETTING TO THE ROOT OF IT The process of making tequila is just as stringent as that of cognac, scotch, or champagne. It all begins with Agave

tequiliana Weber, better known as blue agave. “Red” soil is the most optimal for growing the blue agave because of

passed down through generations. Family tips and tricks have been shared since the times of Ancient Mexico and have become an essential part of the tequila process. Those who grow and harvest the agave plant are known as “jimadores.” During the harvest season, jimadores use coas, long, machete-like rounded knives, to cut the leaves off the agave plant and to separate the plant from its roots.

PURIST STYLE PROCESS

its richness in iron and other

After the agave is harvested, it is cut into halves and then

properties.

quarters before being placed into a brick oven (horno) for slow

The

volcanic

cooking over the course of 50 to 72 hours. Some more modern

soil in the state of

facilities have autoclaves that speed up the process through

Jalisco, Mexico, and

steam pressure-cooking, reducing the time to 12 to 18 hours.

the Highlands region

Once the cooking process is completed, the agave is cooled for

— even more so — are

24 to 36 hours and placed on conveyors for shredding, tearing

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and rinsing before the juice is extracted. The juice is then siphoned into stainless steel vats for fermentation. During

ard Winning o Aw t k 5 or ce 185 n i S u p p ly i n g C s s ller d i st i

fermentation, the natural yeasts in the agave sugar turn the juice into alcohol. Seven kilos of piĂąa are needed to produce one liter of juice, and the average piĂąa holds two to five liters of juice.

DISTILLING: IT’S A BIG DEAL Different types of tequila are a result of varying distillation processes. Some tequila companies double distill their tequila before immediately bottling it. Silver, Blanco, and Platino are popular names of the twice-distilled variety. To produce a very clean sipping Blanco, the heads and tails of the distilled juice are cut during the second round of distillation. For an aged tequila, the agave juice is placed in a barrel of the producer’s choice. Popular barrels are American Oak, French Oak, and previously used Bourbon Barrels. For many people, the most well-known tequila styles are Blanco, Reposado, and Anejo, each produced differently to

Ĺ­ KFMJOFL DPN

create a unique and flavorful alcohol. Blanco tequila has not been aged and is bottled immediately following distillation, Reposado tequila rests in a barrel of choice for one to nine months, and Anejo tequila ages in a barrel of choice for one to three years. Unless you’re a tequila aficionado, you probably did not realize that some of the tequila on the market is a mixto, or an impure form of the spirit. Pure tequila is 100 percent blue agave, whereas a mixto can contain as little as 51 percent blue agave. To be a true tequila, the spirit needs to be grown, addressed, and bottled in Mexico. The Tequila Regulatory Council (CRT) oversees the production, bottling, and labeling of tequila. It protects the standards of the tequila process and the integrity of the goods.

WAYS TO ENJOY TEQUILA The ways to enjoy a beautiful tequila are endless. Try using a snifter or Reidel for sipping, or include the spirit in your favorite cocktail — pair Blanco in a Cosmopolitan or Paloma, Reposado in a Margarita, or Anejo in a Manhattan. When the spirit is great, your drink will be, too.

Lisa Barlow is co-owner of Vida Tequila. For more information, visit www.vidatequila.com.

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CRAFT MADE TONIC A

WRITTEN BY STEVEN SEIM

s the craft spirits industry grows, so too are the cottage could actually taste like.” Brad’s knowledge of the evolution of industries around it taking advantage of the opportunity gin and tonics also helps drive him to develop tonic’s stale flavor

to expand and evolve. Among the creators turning passion for into something more worthy of its history. He has researched spirits into a growing fringe market is Brad Feather, creator of quinine’s (the base ingredient of most tonics) use as medicine Kina Tonic. This tonic concentrate, sold in volumes not much against malaria and its evolution into an ingredient used by the bigger than most bitters, is his take on a handmade craft mixer. British East India Company, saying, “That’s my favorite of the Based in Seattle, Bradley turned a Kickstarter campaign into stories, because it’s the only reason we still consume G&T’s this successful side business. Part of his inspiration, he says, today.” After quinine stopped being useful as an anti-malaria came while working at Sound Spirits Distillery (which he still drug, its popularity didn’t subside. Part of the reason for that was works at part time). He was put off by seeing customers mixing a common method of taking the medicine was mixing it with gin. premium gins with poor tonics: “After all of the time struggling

While quinine is the essential ingredient in a tonic, there are

to make a perfectly balanced malt-based aromatic gin, folks still a wide variety of recipes and ratios that exist between different go and dump a half a can of store brand diet tonic on top of it. brands. Brad is proud to say that Cinchona Bark (or Kina Bark), It just blew me away.” While he doesn’t blame consumers for which is the source of Quinine, makes up 90% of his spice bill. not knowing about tonic-alternatives, his goal is to help educate That is unique among tonics. “In fact,” he says, “I only have more people about craft mixer options in order to improve their two other spices included in the whole damn recipe.” While drinking experience.

he doesn’t reveal his entire process, he does say he sources

So where did Brad get the idea that tonic can be better than Cinchona from a region of the world that has historically grown the mass-produced stuff bought at the store? During his younger it for medicinal purposes. While the farm supplying his cinchona drinking years, gin and tonics were one of the first cocktails he bark has invited Brad to visit, a personal trip hasn’t been viable learned to enjoy. After working in the alcoholic beverage industry yet. But he has been able to fly to other places around the world and evolving his palate, he says, “frankly, they just started to test ingredients for upcoming, unannounced products. to taste like hell.” Brad searched online for a variety of tonic

Brad is proud of what he believes makes his tonic worthy

recipes, tried several, and was underwhelmed. “Most were way among other craft spirits. He said, “my tonic is handmade from out of balance, but definitely changed my outlook on what a tonic the ground up. Hell, the only machine I have is a tiny pump.”

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Friends help him fill bottles, which he inspects one by one. His add on a bottle of tonic with their purchase of a bottle of gin or ingredients are imported directly to him. Brad told us, “If that vodka,” and selling this tonic can boost a tasting room’s bottom ain’t craft, I don’t know what is.” The success of Kina Tonic line. “Most of my distillery accounts outsell my regular retail means competitors have started to pop up, which means he accounts threefold.” Customers can’t help but be curious about wouldn’t tell us the details of his production process, but he a new type of tonic, and making it readily available helps spread stands behind being called craft. Part of the beauty of the craft spirits industry is the spreading

the word about craft mixers. Besides his standard Kina Tonic, Brad offers a bourbon barrel

of a product based on word of mouth because of its quality. It is aged tonic, as well. Bradley’s Tonic Company also has several the same with this tonic, which Brad says is mostly marketed by products in development. He told us, “some are in the same word of mouth: “I try to attend as many trade-shows as possible vein as the tonic syrup, while some are more cocktail syrups and visit as many retailers and bartenders as I have time for.” Like to be used by the home enthusiast.” Brad’s prediction for the many other craft distillers, Brad understands the marketing that immediate future of craft mixers is that once the craft cocktail matters, saying, “My best salesmen are my happy customers.” boom dies down a little, people will revert to making simpler According to Brad, bartenders and distillers are far more valuable drinks: “I’m betting on the craze slowing down some and people than most marketing campaigns.

really getting into simpler cocktails with quality ingredients as

Among the rest of the distilling community, Brad’s tonic has opposed to complicated cocktails with seven plus ingredients. been a hit. Brad told us “Distilleries have really been huge This is why I’ve invested so much in such a simple product.” No supporters of my business, since most of them are producing gin matter how convoluted people make their drinks, we don’t think and they have the same reservations about cheap modern tonic they can go wrong adding this craft tonic to their home bars. waters.” But distilleries can also benefit directly from supporting Kina tonic: “The tonic also sells like hot cakes out of tasting Bradley’s Tonic Company is based in Seattle, WA. For more info, visit rooms…You’d be surprised how many tasting room customers www.kinatonic.com or call (270) 519-1649.

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D I Y : S A F E T Y O V E RV I E W W R I T T E N B Y C A RT E R R A F F PHOTO BY AMANDA JOY CHRISTENSEN

As we move into a whole new industry of craft distilling, and in light of recent events, it’s clear that safety is something that needs to be addressed. Here are some tips for general safety in a distillery, and also what materials and equipment should and shouldn’t be used.

GENERAL SAFETY TIPS: »» The number one hazard in the

that are close at hand and they

distillery is ignition sources and

should be rated to put out ethanol

your still. When your still is running

fires. Most need to be re-certified

there should not be ANY equipment

once a year.

around or in the distillery running that

is

not

explosion

proof,

whatsoever. Keep windows or doors open for ventilation to prevent vapors from building up.

»» Your distillery should be properly equipped with fire extinguishers

»» Keep emergency phone numbers posted clearly by each phone. This should include, but is not limited to:

911,

Poison

Control

and

EMS. You should also have a fully stocked and organized first aid kit in its proper place.

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»» Make sure all exits are clearly marked and all employees know what to do in case of an

EQUIPMENT & MATERIALS:

As I’ve said in previous articles, virtually no equipment is made

Glass

Acetal (Delrin)

for our industry off the shelf.

»» All employees should be trained on how to

Stainless Steel

Copper

Every piece of equipment I buy or

handle and clean up spills. Have an eye

Polypropylene

Titanium

wash station and a spill kit and procedure

HDPE High Density Polyethylene

Silver Braze

is safe. If I can’t get an answer

Silver Solder (Lead free)

from the manufacturer then I’ll

Cast Bronze

or use one I am sure of. For

Noryl (Some filter plate are made out of this)

example, when I get HDPE push-

Ceramic

with silicone o-rings that are

Brass (Must be lead free brass, or you can de-lead it yourself by soaking it for 5 minutes in a solution of 2 parts white vinegar to 1 part hydrogen peroxide)

orange, which makes it easy to

emergency.

for cleanup: for example, don’t soak rags in ethanol and then leave them inside or piled up in a corner.

»» When the still is running it should NEVER be left unattended. Pay attention the entire time, don’t get involved with a task so consuming that you are not paying attention to the still. The running still is your job at the time, nothing else.

»» All stills should have a pressure relief valve and a pressure gauge. The pressure gauge should be inspected at regular intervals to make sure it’s working correctly. You can either remove the gauge and pressurize it with an air compressor,

LDPE Low Density Polyethylene Santoprene Viton PTFE (Teflon) Silicone Food Grade Silicone Spray Food Grade Anti-Seize Nylon

make I go through to make sure every single piece of material

change out the suspected part

to-connect fittings from Home Depot, I change out the o-rings

tell what has been changed out. To the left is a list of usable materials I find acceptable in a distillery. If ever in doubt consult someone who knows or a Chemical Resistance Chart

or pressurize your still if your still can handle 5

(Cole-Palmer has an excellent

PSI. But also remember if you take the gauge off, you need to do a leak check on it to make sure vapors

one online). There are some materials they consider safe, but

cannot come out. And the most important part: when running

I wouldn’t use, especially with high proof alcohol (such as

the still, if that PSI gauge shows anything other than zero,

Buna-N, PVC, Cast Iron, Aluminum, Rubber, ABS Plastic, etc).

shut off the still immediately and open up the tank to relieve

In the end, what matters is that you’re paying attention to

the pressure. Turn off the heat to the still and open up a

what you’re doing. Have actionable plans in place to protect you

manway or some other means to relieve the pressure of the

and your investment. Most of all get the proper training and ask

main tank.

for help if you need it. We are in the business of making craft

»» Never fill a still more than 75 percent full, especially when distilling grain, which can plug up your column if you’re not operating the still correctly, thereby allowing the still to build up pressure.

alcohol. We want to sell well-made products made with proper equipment.

Carter Raff is owner and master distiller of Raff Distillerie in San Francisco, CA. Visit www.raffdistillerie.com for more information.

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ADVERTISER index ARCHITECTS Joseph & Joseph Architects

42

BARREL RACKS Western Square Industries

DESIGN, BRANDING & MERCHANDISING

GNS & BULK SPIRITS SUPPLIERS

CF Napa Brand Design

MGP Ingredients

19

2&6

IGNITE Beverage Branding

57

Pharmco-Aaper

78

Thoroughbred Spirits Group

21

Ultra Pure

30

36

DISTILLERS Rogue Spirits

BARRELS Barrels Unlimited Black Swan Cooperage

7

6 & 12

Thousand Oaks Barrel Co.

DISTILLERY MERCHANDISE Distillery Products by Laser-On

6 & 34

BOTTLE & GLASS DECORATING 104

BOTTLE MANUFACTURERS & SUPPLIERS Bruni

31

New Westgate Glass Packaging

17

Packaging Support Group Saverglass

7&9 10 108

SGP Packaging

27

Vetroelite

86

Artisan Still Design

23

Global Stainless Systems

87

HBS Copper Stills

64

Headframe Spirits Manufacturing

45

Hillbilly Stills

49

Specific Mechanical Systems

82

Prospero Equipment Corporation

98

Rudolph Research Analytical

99

Vendome Copper & Brass Works

Moonshine University

CONSULTANTS 98

The Rum University

101

Ferm Solutions

Paulson Supply

84

Fermentis

Saxco International

74

Winemakeri Inc.

Tapi USA

56 6 & 22 32

American Craft Spirits Association

7

105 37 98

7 & 107

Fort Dearborn

5&7

PACKAGING All American Containers, Inc. Brad-Pak Enterprises

48 101

Imperial-Packaging Corporation

52

Phoenix Packaging

90

Saxco International

65

McFinn Technologies

78

REFRIGERATION & CHILLERS G&D Chillers

Total Wine & More

4&7

7

TOTES & TANKS Custom Metalcraft

Brewery Finance

CREAM LIQUEURS

LABELS

RETAILER

Spokane Industries

FINANCING Creamy Creation

GUILD ORGANIZATIONS

PUMPS & HOSES

ENZYMES & YEAST

CORKS & CLOSURES Jelinek Cork Group

7 & 15

EDUCATION American Distilling Institute

Spirits Consulting Group

72

99

DISTILLING EQUIPMENT

O-I

Brooks Grain

72

European Woodworking Machinery Co. 79

Loggerhead Deco

GRAINS

54 103

28

75

ARTISAN SPIRIT sponsors

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PIONEER

IN CRAFT

The new 3 CRAFT COLLECTION designs by SAVERGLASS: DISTIL'ER, ISLAY & FORTY-SIX respond to the broader range of spirit styles and the desire for differentiation.

SAVERGLASS INC. Napa (CA): (707) 259-2930 East Coast (NJ): (201) 825-7100 Pacific North West (OR): (707) 337-1479 Mid West (KY): (859) 308-7130

www.saverglass.com HAUTE COUTURE GLASS