malting YOUR NEXT
tips for the new distiller
soft fruit MEETS
ROSES, FRUIT, AND
HOW TO BUILD YOUR DISTILLING TEAM
Brand Design for the Spirits, Wine and Beer Industries.
DESIGN FOR PACKAGING, LOGOS, CUSTOM BOTTLES, COLLATERAL, SIGNAGE, WEBSITES & NAMING 2787 napa valley corporate dr, napa, california 94558 t | 707 265 1891 www.cfnapa.com
TABLE of CONTENTS A LETTER FROM THE EDITOR
QUARTERLY U.S. GUILD REPORT
What’s going on, state-by-state
DSP FEDERAL REPORTING TAXATION OF DISTILLED SPIRITS
GRAND RAPIDS, MICHIGAN
Crafting a Spirited Cocktail Culture
An American problem
BIG DATA ON GROWTH TRENDS AND SALES
IN-MASH MILLING PART TWO
Monthly Report of Processing Operations TTB Form 5110.28
Distilling the future industry trajectory
FRUIT DISTILLATE FERMENTATION80
ACSA: WHERE PAST IS PROLOGUE
from the Board of Directors of the American Craft Spirits Association
THE OREGON STARKA PROJECT
YO HO HO AND A BOTTLE OF (LYON’S) RUM 31
Working together to introduce an old world spirit
Find the right people for the job
Navigate the path to label approval
COPPER FOX DISTILLERY
Of Sperryville, Virginia
THE IMPORTANCE OF PROPER TIERING
Brand Buzz with David Schuemann
SWEETGRASS WINERY & DISTILLERY
Of Union, Maine
Lyon Distilling Company of Saint Michaels, Maryland
BUILDING A GREAT TEAM34 TIPS FOR THE COLA PROCESS
The art and science — Part 1
And importance relative to fermentation and distillery ethanol yields
HILLBILLY?92 Hillbilly Stills of Paducah, Kentucky
LEAPING ACROSS THE SEA
An introduction to working with the Far East
HOW TO GET INTO DISTILLING WITHOUT HAVING TO OWN THE JOINT
Go from whiskey lover to whiskey maker
FROM THE FLOOR UP50 Self-malting distilleries
Smelling roses, fruit, stinky feet and much more in my glass
MEET THE TIN MAN
BREAKING UP WITH YOUR DISTRIBUTOR
THE ART OF THE SHOW
How to prepare for your best spirit show yet
Tinbender Craft Distillery of Spokane, Washington
ALLTECH BREWING AND DISTILLING ACADEMY
Of Lexington, Kentucky
When your relationship no longer serves your brand
NEW DISTILLER ETIQUETTE66
from the COVER
July 18, 2015 at McMenamins Edgefield in Portland, Oregon
DISTILLED SPIRITS AND KEY FLAVORS53
How to perform tactful reconnaissance
THE OREGON DISTILLERS FESTIVAL
5 STEPS TO DISTRIBUTION
Finding and keeping the best distributor to meet your needs
Catoctin Creek Distilling Company in Purcellville, Virginia. Image by Amanda Joy Christensen.
Issue 12 /// Fall 2015 PUBLISHER & EDITOR Brian Christensen CREATIVE DIRECTOR Amanda Joy Christensen SENIOR WRITERS Amber G. Christensen-Smith Chris Lozier
CONTRIBUTORS Maggie Campbell Stephen Gould Josh Heintz Patrick Heist, Ph.D Jim Hyland Johnny Jeffery, M.S. Justin Koury Attila Kovacs Marat Mamedov Jim McCoy
John McKee Darleen Peters Carter Raff Jeanne Runkle David Schuemann Kellie Shevlin Marc E. Sorini Gary Spedding, Ph.D. Dianna Stampfler
PHOTOGRAPHERS Peter Barrett Amanda Joy Christensen Drew Davis Peter Guyton Andrea Hutchinson innovative & custom solutions
Taryn Kapronica Josh Marberry John McKee Kathleen Nyberg Jaime Windon
SALES & MARKETING Ashley Monroe
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
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.
EXPANSION. It’s inevitable, but when a distillery meets with success the next step is to expand. This can include everything from production, to larger distribution, more employees, and even larger marketing campaigns and branding redesigns...
Remember the pain to get your DSP and first COLA? Multiply that by 50! When sales cross state lines you leave the pro-craft, support-the-little-guy encouragement of your home state. Each state requires permits, brand registrations and reporting, and has unique laws for sales and transport: it’s like trying to enter 50 different countries. Most small distilleries hit these regulations like a brick wall. Our advice – outsource. Work with companies that can provide an established infrastructure. You are free to focus on your passion: making exceptional spirits and engaging your customers. — R. Scott Winters
As a small business ourselves, we are also dealing with the growing pains and feeling the pressure as this industry keeps expanding. One simple piece of advice, take it one day at a time–nothing happens overnight. When your expectations get too high, you can easily set yourself up for failure. One goal at a time my friends, sometimes less is indeed more! — Heidi Karasch
Growing allows a unique opportunity to refocus packaging before broad distribution occurs. When expanding, new bottling and production methods are sometimes necessary to accommodate the higher production levels. This includes reengineering packaging to run more efficiently and redesigning the packaging to be more cost effective with scalability in mind. Expanding markets provide a chance to address branding issues and to capitalize on new packaging opportunities to be more competitive. Case Study: www.cfnapa.com/case_studies/valentine-distilling-co/ — David Schuemann
As a manufacturer for distillery equipment, this is a “good” problem our customers encounter quite often. They start off thinking minimal and small, then after a couple years, their equipment needs can double in size. We work with them to utilize the space they have for expansion and provide custom designs. We understand that space can be a premium and enjoy taking this challenge on with the customer. — Jake Lipscomb
ILL DIST D PRO BY
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 Hurdles to expanded production are can further our common goals often only realized when there’s insufficient of supporting creativity, infrastructure to support expanding production innovation, and integrity demands. Available space, electrical power, domestic within the industry water, heating gas, waste water, and cooling all have the ability to limit your distillery’s production capabilities, and ideally we all love so should be considered from the beginning. Having the proper infrastructure much. in place from the start is ideal, but in many cases unfeasible. Starting with a modular chiller system can help the startup distillery get off the ground, and allow for headache free and cost effective expansion when the need arises. — Paul Johnson
Admitting you have a problem is the first step, and we’re happy that you can admit it. You’re beginning to bulge in all the wrong places and are starting to feel ashamed by the looks you’re getting when vendors see you walking towards them at a conference. The thing to remember is, you are not alone, and we’re here to help. One of the best things to do is remember to check with you local inspectors to see how your expansion will affect your permits and if they are within compliance, and to do so before you start moving forward with a plan. — Colin Blake
Tapi has been fortunate enough to be riding the craft wave and facing the exact situation as described. It would appear that confidence is the key. Our ownership has had confidence to add capital expenditures, to make available inventory to support growth and to build sales and customer service structure. Like a good golf game one must have the confidence to roll in the long putt when the opportunity presents itself. — Kevin Dunbar
From a retail perspective, craft distillers should have a roll-out strategy and maximize the chance of success in each market and retailer you decide to launch in. — Eli Aguilera
A LETTER FROM THE EDITOR: More often than not, distilling seems to break down to 10% production and 90% taxes and regulation. It’s challenging for us to talk about home distilling and not come across sounding a little naïve or hypocritical. A topic Artisan Spirit Magazine hasn’t completely ignored, but one we have been admittedly sparse in covering. The pitfalls are manifold. On one hand, there is the undeniable fact that home distilling in the U.S. is a federal felony offense, and there is a non-trivial safety concern that accompanies distillation. On the other hand are the multitude of legal distillers who have gotten their start and tempered their skills on home stills. The topic is drawing increasing industry dialog as some tax bills start to appear with home distilling included, and federal agencies crack down harder on home distillers in recent years. Artisan Spirit Magazine’s primary focus has always been on working with and supporting distilling entrepreneurs. As a trade publication, we have an obligation to take a strong stance and remind everyone that home distilling is illegal. Don’t do it. If you want home distilling, work to get the laws changed, but don’t break them. However, we are also adamant about the need for change specifically in the areas of distilling experimentation, research, and education. Hopeful distillers need the freedom and flexibility to practice their craft, and right now it’s too damn hard to do that legally. We don’t have an easy answer, but eagerly support any efforts to make distilling education easier to accomplish. On the national stage, FET reform has also continued to make headlines and draw supporters. We are proud to help support the voices of the American Craft Spirits Association, American Distilling Institute, the Distilled Spirits Council of the United States, and the many other guilds and organizations that strive to bring tax parity to the distilling industry. Get out there and add your voice.
We all make a pretty good team.
PO Box 31494 Spokane, WA 99223
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CALIFORNIA CALIFORNIA ARTISANAL DISTILLERS GUILD Well, AB1233, the CA direct to consumer bill we were working on earlier in the year, has been put on hold for the time being. The reasons are varied, but as with any piece of legislation it ultimately comes down to timing and political climate. In the meantime there is good news for us in the Golden State as we can finally see the light at the end of the tunnel. Assembly members Marc Levine and Adam Gray were able to pull together several sectors of the industry to agree on bill
AB1295, which will allow not only restricted direct to consumer sales, but would also establish a special Craft Distiller’s License that would allow further privileges, as well. The CADG is very optimistic that this bill will move forward and that by 2016 we will finally be in a position to compete on an equal footing with our colleagues in other states across the country who already enjoy these privileges. Exciting times indeed. Within the CADG remit we also aim to enhance consumer awareness of local products and craft distilling in general, and to do this we recently formed an Events group within the guild, whose focus will be to help us achieve this goal. They recently helped to
bring together over 27 members of the CADG at the Craft Spirits Carnival which was held in San Francisco in August, and was a very successful showcase for California products. We also started a Regulations group that is looking to help bridge communications between our members and the CA ABC. We’re grateful to already have a great relationship with the CA ABC, and with both the formation of this group and AB1295 in the pipeline, we look forward to being able to support each other mutually as our industry grows. Timo Marshall President, CADG Cat Herder, Spirit Works Distillery For more information find us at www.CADSP.org CONTINUED ON NEXT PAGE...
COLORADO COLORADO DISTILLERS GUILD Summer in Colorado means everyone is super busy including the Guild. Right now we are continuing to work with our LED, State AG office and Legislator to clarify a reinterpretation of the law that will require DSP’s who selfdistribute to acquire a wholesale permit at an additional $1050.00 per year. We have also just wrapped up our economic impact
FLORIDA FLORIDA DISTILLERS GUILD Florida has experienced unprecedented growth in the past 18 months. In December of 2013, there were only eight licensed distilleries in Florida. By the middle of 2015, 18 new distilleries had acquired their DSPs. There are now some 25 distilleries operating in the Sunshine State. Many more are in startup mode. The reason for the growth is simple: artisans and entrepreneurs are hedging their bets that Florida will continue to improve the business climate for distillers to operate. In 2013, the Florida Distillers Guild was formed to unite existing distillers and create a strong voice to change prohibition-era laws to mirror those in other leading states such as CO, NY, OR and WA. At that time, distillers were prohibited from selling any bottles to customers on-site. Guild members and its lobbying firm began the process of opening up the Florida market to craft distilleries.
MAINE MAINE DISTILLER’S GUILD A group of eight Maine distillers met at Sweetgrass Farm Winery & Distillery in Union, Maine to form the Maine Distillers Guild (MDG), with a purpose to join together to focus on marketing, legislative actions, and the industry needs of distilleries in Maine. A plan was established for members to work on the formation of an organization into a 501(C),
study and plan to share the results with our members at our fall meeting in Breckenridge this October 23-24. This is the same weekend as the Breckenridge Spirits Festival and the Still on the Hill grand tasting, one of the best events of the year! Looking forward we will be increasing our efforts with the Colorado Tourism Office, expanding our marketing efforts, and raising the exposure of the Colorado distilling industry in general. Our plans include a handful of very exciting opportunities that could give Colorado
Distillers ongoing international exposure (You’ll have to wait for details!). Recently I met with Metro State University in Denver about expanding their hospitality program to include a degree in distillation. For now the cocktails are cold, the sun is warm and Colorado craft distillers continue to produce some of the finest spirits in the world!
It was immediately understood that that some powerful interests would oppose major change to existing laws, and a legislative battle ensued. Towards the end of that legislative session, a compromise was reached and Florida craft distillers would be allowed to make limited sales from their gift shops. It was a modest but important victory: the right to sell two bottles, per person, per year for offpremise consumption. In early 2015, a pro-freedom Florida legislator filed ambitious legislation, asking for unlimited bottle sales from distilleries while other Florida legislators filed separate legislation increasing the number of bottles that could be sold for off-premise consumption. In the end, we achieved another victory: two bottles, per brand, per person, per year and the right to place signage on Florida highways. Despite this remarkable progress, the Florida Distillers Guild does not operate as effectively as we originally hoped. Due to geographic reasons and that we all work 24/7 to make our businesses profitable, it’s difficult for us to get together regularly.
Nonetheless, it is our hope in the coming year that we can accomplish three important goals: 1) Establish the 1st Annual Florida Craft Spirits Festival to promote Florida’s Craft Spirits Producers and their products to the general public. 2) Work with VisitFLORIDA (state tourism agency) to encourage visitation to distilleries who offer tours and operate tasting rooms. 3) Help support HR 2520 (Distillery Innovation and Excise Tax Reform Act) to lower Federal Excise Taxes on the first 100,00 gallons for distilled spirits producers. We are excited about the future. The Sunshine State is the nation’s second largest consumer of distilled spirits. Given our state’s remarkable agricultural resources and robust tourism, Florida could become one of the nation’s leading producers of craft spirits.
set up member communication through Facebook or group website, and strategize on marketing. Distilleries discussed their immediate concerns such as direct shipping, state liquor laws around back bar infusions, transportation of all spirits to central warehouse even if spirits are to be sold at the distillery, and a need for better communication and support from BABLO – Maine Liquor Control. Since this initial meeting the Maine Distiller’s Guild has come together putting
legislation before the state legislature on rules around pouring and elimination of the need to pass product sold at the distillery through the state warehouse. The MDG also responded to an initiative by BABLO to penalize distilleries when their products are out-of-stock at the state warehouse. Although none of our work towards these issues has been passed or accepted, we continue to educate our state representatives and BABLO officials.
P.T. Wood Alchemist /President CDG Wood’s High Mountain Distillery email@example.com
Past President, Florida Distillers Guild Philip@staugustinedistillery.com
Keith and Constance Bodine Sweetgrass Farm Winery & Distillery CONTINUED ON NEXT PAGE...
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MARYLAND MARYLAND DISTILLERS GUILD The Maryland Distillers Guild was formed in March 2015 to represent the seven operating
MASSACHUSETTS MASSACHUSETTS DISTILLERS ALLIANCE Mass. distilleries have banded together in order to bolster the craft spirits industry. We are proud to announce the formation of the Massachusetts Distillers Alliance: an organization of craft producers who have joined together in order to open lines of communication between distillers, foster a sense of community in the local spirits industry, educate the public, and serve as a collective voice in government affairs with regard to craft distilling.
MICHIGAN MICHIGAN CRAFT DISTILLERS ASSOCIATION The Michigan Craft Distillers Association (MiCraftSpirits.org) was formed in 2014 to organize the growing number of spirit producers in the state and to serve as a united voice on legislative, promotional and business levels. Today, Michigan distilleries are actively producing award-winning vodka, rum, gin, whiskey and other unique spirits. Currently, Michigan is one of the leaders by 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. Dianna Stampfler, CTA Dianna@PromoteMichigan.com (269) 330-4228 www.PromoteMichigan.com
distilleries and those in-planning. In these first few months, we have hired an executive director, and formed several committees to develop law changes, encourage the growth of needed agricultural sources, and create events to promote the industry. The Guild was active during Maryland’s 2015 legislative
session and is planning major revisions to law in 2016. We currently have 18 members and anticipate great industry growth over the next year.
FOUNDING DISTILLERIES INCLUDE:
The formation process for the guild began in 2014, with its official incorporation and the formation of a board of directors in spring and early summer of 2015. The Massachusetts Distillers Alliance is currently headed by Matt Nuernberger (President), Bob Ryan (Vice President) & Dave Roberts (Secretary). With the first official meeting taking place in late summer 2015, the Mass. Distillers Alliance will be hitting the ground running, forming initiatives to facilitate materials sourcing and cooperation between small producers.
• 20 Paces Distillery (Dover) • AstraLuna Brands (Medfield) • Berkshire Mountain Distillers (Sheffield) • Boston Harbor Distillery (Dorchester) • Bradford Distillery (Hingham) • Bully Boy Distillers (Roxbury) • Damnation Alley Distillery (Belmont) • Dirty Water Distillery (Plymouth) • GrandTen Distilling (South Boston) • Privateer Rum (Ipswich) • Ryan & Wood Distilleries (Gloucester) • South Hollow Spirits (Truro) • Turkey Shore Distilleries (Ipswich) • Triple Eight Distillery (Nantucket)
Jaime Windon Lyon Distilling Co. President, Maryland Distillers Guild
Maggie Campbell Head Distiller Privateer Rum
UPCOMING MICHIGAN CRAFT SPIRITS EVENTS AMERICAN SPIRITS: THE RISE AND FALL OF PROHIBITION Sept. 26-January 17, 2015 Grand Rapids Public Museum /// grpm.org
This exhibit explores America’s most colorful and complex constitutional hiccup, spanning from the inception of the temperance movement, through the Roaring ’20s, to the unprecedented repeal of the constitutional amendment. Interactive elements and immersive environments bring to life the sights, sounds and experiences of the time period. Visitors have the chance to take a quiz to find out if they are a “wet” or a “dry,” learn the Charleston in a recreated speakeasy and play the role of a federal Prohibition agent chasing rumrunners in a custom-built video game. At the end of the exhibition, visitors will explore the legacy of Prohibition in today’s regulatory landscape. Displays show why and how laws differ from state to state, and how the idea of drinking responsibly evolved. GR COCKTAIL WEEK Nov. 11-22, 2015 /// Experiencegr.com/cocktails
Bringing attention to the wealth of spirited bartenders and award-winning distilleries in Michigan, this inaugural 12-day celebration is
presented by Experience Grand Rapids (creators of GR Restaurant Week and Cold Brews-Hot Eats). Participating restaurants feature locally-distilled spirits in their “Cocktail of the Week” which is paired with a special appetizer or small plate. Special events, including intimate cocktail dinners, are also planned. The complete schedule of events, as well as restaurant cocktail and small plate menus, is posted on the Cocktail Week website, above. GRAND RAPIDS INTERNATIONAL WINE, BEER & FOOD FESTIVAL November 19-21, 2015 DeVos Place /// GRWineFestival.com
Michigan craft spirits have been part of the festival since it was first held in 2008, but in recent years— with a growing interest in the art and science of cocktails—the focus has been amplified. Distilleries are now featured alongside international wines, beers and ciders in this event which draws 18,000 people annually. In addition to sampling, a variety of free workshops and seminars are hosted, led by industry professionals and food and beverage experts. This year, the 8th annual event will be bigger and better than ever before—with an expanded footprint into the main exhibition hall.
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MONTANA MONTANA DISTILLERS GUILD After our victories in the 2015 Legislative Session (see previous Guild report), the Montana Distillers Guild is focused on administrative rule creation to address the implementation of those new laws. Working
NEW MEXICO NEW MEXICO DISTILLERS GUILD The New Mexico Distillers Guild (NMDG) is looking forward to an active fall season building public awareness of craft spirits in New Mexico and gaining political support. Our executive committee now meets monthly by conference call and plans are to have
NEW YORK NEW YORK STATE DISTILLERS GUILD With the support of a grant administered through TasteNY and Empire State Development, the New York State Distillers
TEXAS TEXAS DISTILLED SPIRITS ASSOCIATION Members of the Texas Distilled Spirits Association (TDSA) had the opportunity for the second straight year to help throw the signature party at the Texas Package Stores Association Convention in San Antonio on July 26th. The Package Stores Association was established over 60 years ago, organized to protect the interests of package stores, or liquor stores, in Texas, just as TDSA protects the interests of distillers in our state. Folks from all over the alcoholic beverage community gathered together during what appeared to be one of the largest industry
closely with Department personnel and industry partners, we look forward to full implementation of new delivery allowances in the new year. In addition to policy growth, the Guild will embrace membership growth, with new distilleries moving towards production. Our Guild representatives will continue to reach out to new members of our industry to highlight the benefits of membership.
We are excited about partnering with the Governor’s Office of Economic Development to elevate the distilling industry alongside our manufacturing partners of breweries and wineries, and look forward to developing opportunities for this burgeoning field in conjunction with agriculture and tourism interests.
quarterly “added value” general membership meetings. Once general business is conducted the idea is to make the most of our members’ time and travel by hosting tastings with politicians and key suppliers, distributors and accounts, or having technical meetings to help with operational issues faced by our members. The first event is scheduled for September. In October we hope to have all members attend New Mexico Brew Fest 6 which is
now growing into a showcase event for all NM craft beverage alcohol producers. Our goal is to raise awareness and build support for our legislative initiatives which include reintroduction of our retail reciprocity bill in the 2016 session, and looking ahead to 2017 when we hope to tackle state excise tax parity.
Guild is focused on building and executing a consumer and industry facing website that will build awareness of NY’s spirits and drive visitor traffic to our distilleries. This is particularly timely, as many of us are currently expanding our visitor offerings to take advantage of new privileges to sell spirits
by the glass. In the next legislative session we will be working to continue to dismantle barriers to market access for all of our state’s distilleries. Nicole Austin
gatherings in Texas. Manufacturers from the beer, wine, and distilled spirits arena had the opportunity to be in front of liquor store owners and employees, as well as distributors and wholesalers. The state agency that oversees our industry, the Texas Alcoholic Beverage Commission, was also in attendance. Being as Texas is a three-tier state, as is much of the United States, having the opportunity to have so many individuals from the different tiers in the same room at one time is golden, not just for business, but for relationship building opportunities from industry to industry.
Education/Outreach, and Marketing. TDSA has the passionate goal, as do many other guilds and associations across the country, of setting out to change the industry for the better through our lobbying efforts at the Texas Capitol. No matter how great of an argument or story you have to tell about your business or industry, you cannot go at it alone. Texas is a competitive state, with a rich history in providing a business friendly environment. There are multiple associations and groups that represent distributors and wholesalers, manufacturers, retailers, and other special interests within our industry. Many have been around for multiple decades and have established a solid foundation. They all have their lobbying efforts and goals too, in which they are tirelessly working to protect
ANSWER THIS QUESTION: “WHY DOES YOUR ASSOCIATION EXIST?” For TDSA, we focus on four areas: Governmental Affairs, Regulatory Influence,
Jennifer L. Hensley Government Affairs Liaison
Dr. Greg McAllister Algodones Distillery, NMDG Sec’y/Treas. 505.301.9992 firstname.lastname@example.org
Oak View Spirits Kings County Distillery New York State Distillers Guild American Craft Spirits Association
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and better their businesses. TDSA has been spending countless hours on relationships, building long-lasting partnerships across the industry, even if we disagree on issues. It all goes back to the saying, “If you want someone to help you, it helps if they know/like you first.” Considering TDSA was established in 2012, it is imperative to us that we build our
TE IS YOUR STA
la Share your
working together with those who have been around longer than us. Scott T. Stewart Executive Director & Governmental Affairs Texas Distilled Spirits Association
! d suppliers distillers an ft ra c f o e c n s. tional audie fellow guild reach a na nd inspire to a y s, it e n g u n rt o lle opp cha your latest out on this ns to solve Don’t miss io st e g g su VED! rs, request it supporte O GET INVOL
relationships and maintain an open line of communication. And this doesn’t just include those who deal directly with distilled spirits, but also the beer and wine manufacturers and wholesalers, as well. There is a lot of work to do and policy to learn in our industry, and it starts by getting to know and
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GRAND RAPIDS, MICHIGAN CRAFTING A SPIRITED COCKTAIL CULTURE WRITTEN BY DIANNA STAMPFLER PHOTO BY DREW DAVIS, FUTUREGRAFFITI
istilled spirits in Michigan date back to the earliest
Ventures (owners of Stella’s, Grand Rapids Brewing and HopCat).
explorers, who traversed the vast open lands in search of
“Unfortunately, a little before its time,” says Garry Boyd,
new frontiers in the years before statehood in 1837. Whiskey
Ringleader and VP of Food, Beverage & Cultural Innovation
was a commodity sold and traded to Native Americans. By the
for BarFly Ventures. The Viceroy lasted just two years before
mid-1800s, the first distilleries were established to craft spirits
the space was merged into the Stella’s Lounge, another BarFly
here in the Great Lakes State.
In 1873, a young German immigrant by the name of William
Since 2012, Grand Rapids has been recognized as Beer
Peter Drueke arrived in Grand Rapids and began building a
City USA. It’s also regarded as one of the state’s top foodie
future for himself, quickly becoming a leader in purveying good
destinations. Now, Michigan’s second-largest city is shaking
whiskey. His company would last until 1918 when Michigan
things up on the cocktail side of things.
became the first Midwest state to vote in statewide Prohibition— two years before it became a national law.
“Grand Rapids has nurtured craft beer lovers for around a decade now, calling all types of beer drinkers to appreciate the
During those 15 Prohibition years in Michigan, the bootlegging
subtlety of just four ingredients,” says Lyndsay Israel on the
industry was alive and well with rum runners transporting liquor
Experience Grand Rapids blog (experiencegr.com). “Breweries
between Canada and Detroit, and a thriving gangers industry in
have covered the region and bolstered the tourism and restaurant
Chicago just a short drive into southwest Michigan. Ironically, it
industries immeasurably. Now, the spotlight turns to the next
was during the mid-20th Century that Michigan’s spirit industry
tier of craft beverage production. This is an exciting step for
all but dried up in the wake of Prohibition. It’s only been in
Grand Rapids and it’s great to see this city take that step from
recent years that the industry has come back to life, with vim
brew culture to craft culture.”
and vigor. The first experiment in the craft cocktail culture in Grand Rapids was The Viceroy, which was opened in 2010 by BarFly
Building on a growing interest in craft and locally-sourced ingredients, the GR Cocktail Guild (grcocktailguild.com) was formed in January, 2015.
“The more I travelled and met great people through the
Competition—first held in May, 2015—pits three incredibly
United States Bartenders Guild, the more I recognized how
talented spirits professionals against each other in a mixological
little foundation the cocktail scene in Grand Rapids had,” says
battle-royale, with twists, turns, local ingredients and audience
Torrence O’Haire, USBG member, founder of the Grand Rapids
interaction. Upcoming competitions are scheduled for September
Cocktail Guild and Private Events & Culinary Coordinator for the 16, October 14 and culminating November 18 with the Ultimate Downtown Market Grand Rapids (downtownmarketgr.com).
Iron Bartender Championship Finals.
“We definitely have some great talent, but without support,
Spectators can learn how these cocktail-professionals devise
recognition, resources and opportunities for growth, the talented
new drinks utilizing culinary conceptualization in a great new
West Michiganders puttered around in the background behind
way, and watch the creative process in action, as each competitor
the fanfare for ‘Beer City USA,’” says O’Haire. “When I tested the
has only 15 minutes to prepare two flawless libations to be held
idea of the Grand Rapids Cocktail Guild, so many people said ‘Yes! at the mercy of the panel of judges (including fellow cocktail Please do that!’ and ‘How can I join?’ The professionals and pre- professionals, local celebrities, and media). professionals in this area were so excited to validate and develop
“I regularly meet talented bartenders who are ready to showcase
our skills that it was surprisingly easy to get the ball rolling.” their cocktails to the Grand Rapids consumer,” Dickerson says. Led by a group of spirits professionals and cocktail experts “It is only a matter of time before craft cocktails are going to be from every side of the industry—from restauranteurs and
seen at the top of all the drink menus across town. The Michigan
bartenders, to distillers and distributors—the GR Cocktail Guild
distilling scene is also booming, which is going to inevitably
is focused on education and community engagement around the
increase demand for craft spirits.”
art and practice of a well-made cocktail. It is also an official
From “Beer City” to “Foodie Town” to “Cocktail City,” Grand
chapter of the United States Bartending Guild (usbg.org)—a
Rapids is serving up a well-rounded epicurean way of life that
local collegiate of experienced professionals working to develop, appeases both novice and expert palates alike. enrich and share the history, art, culture and enjoyment of the distilled spirit.
“The craft cocktail culture here has been emerging from the underground in the last few years,” Boyd says. “There are now
“I am finding Grand Rapids is poised to be the next Midwestern
several well-established craft cocktail bars in the city being
cocktail destination,” says Adam Dickerson, Midwest Spirits
supported by a Michigan craft distilling culture that has been
Ambassador for New Holland Brewing Company & Artisan Spirits, developing alongside of it, as well. There are a ton of talented and board member for the Grand Rapids Cocktail Guild. “It is
people making fantastic cocktails in Grand Rapids, being
really exciting for me to be able to look down the road a few years
supported by a bunch of people making world-class spirits all
and anticipate how the cocktail scene here will develop.”
over Michigan. You don’t have to travel to Chicago or Detroit to
The GR Cocktail Guild holds events, hosts classes, supports
explore this world anymore!”
local bars and restaurants, creates recipes, shares advice and works at a grassroots level to get people excited about galvanizing Dianna Stampfler is president of Promote Michigan and executive and expanding a legitimate cocktail scene in Grand Rapids. director of the newly formed Michigan Craft Distillers Association. One of the group’s signature events, The Iron Bartender Visit www.MiCraftSpirits.org for more information.
Craft distilleries... you’ve got
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CUSTOM GLASS MOLDING GLASS & ACCESSORIES SOURCING QUALITY CONTROL PRODUCTION MANAGEMENT
make a splash
WRITTEN & PHOTOGRAPHED BY JOHN MCKEE
OOPS, WE BROKE IT. In testing new equipment in new ways, sometimes you make a mistake that upon reflection seemed obvious, but you hadn’t worked it out previous. We mounted the mixer through the sidewall of our mashtun, intentionally, due to our desire to retain the integrated sweep mixer. In our case, this meant that the mixer required a seal to hold back the liquid volume inside the mashtun during mixing. Remember the mixer spins at a very high RPM, 3250 at full speed. We were having so much fun testing the mixer with all kinds of things that we didn’t immediately take into account the deflection-tolerance that the mixer shaft has with the seal, which is very tight. When in-mash milling grain and small particle sized material, the particle sizes do not cause large deflection in the shaft when solids are contacting the mixing head. In contrast, picture the deflection caused by whole potatoes hitting the mixer head and causing a much larger deflection in the shaft, and thereby breaking the seal. By way of analogy, take a pen and push it through a plastic cup lid. Lightly flick the pen and the lid opening doesn’t tear. Smack the pen
IN PART 1, WE COVERED:
» THE WHAT AND THE WHY » THE QUESTION AND THE CHALLENGE » THE DEFINITIONS & THE DIFFERENCES » THE PRACTICAL AND THE ROI » THE TRIALS AND TRIBULATIONS » AND FINALLY, THE INITIAL RESULTS IN PART 2, WE COVER:
» OOPS, WE BROKE IT » FOUND OUT WHY & FIXED IT » TRY, TRY AGAIN THE TESTING… » OVERALL RESULTS OFYEP, WE LIKE IT.
to the side and the plastic lid tears. Same principle here, the potatoes were smacking the mixer shaft enough to break the seal. So, we broke the seal and the tank had a leak….damn it.
FOUND OUT WHY AND FIXED IT... Our team pulled the mixer and we got a good look at the seal (see pic), which goes without saying, it wasn’t supposed to look like that. We pretty much had it figured out by that point, but we wanted better answers. We emailed the OEM and had a great discussion with their design engineers about the path to failure and the path to fixing it, and they hammered out an
immediate change to our seal design and got it on the way for us. We had made the initial decision to go with a side-mounted shear mixer due to pre-existing conditions, but the actual issue could have also been avoided by installing the mixer vertically from the top of the tank. There cannot be a leak if there isn’t liquid against the mixer connection. The OEM does have options for sweep mixers that work concurrently with their shear mixers in vertical configurations, which after going through our issue, I would recommend to anyone thinking about implementing in-mash milling at their distillery.
OVERALL RESULTS OF THE TESTING…YEP, WE LIKE IT. In-Mash milling has been extraordinarily successful for us, even considering our cock-up with the seal and whole potatoes. In the aggregate, the purpose was to prove that we could:
»» Safely grind base grains to a consistency that would be appropriate for mashing and fermenting.
»» Create a mash that was appropriate for grain-on distillation if desired.
»» Remove the safety concerns and associated costs from milling grain on-site
TRY, TRY AGAIN... Regardless of the change to seal geometry, we just aren’t going to be able to throw whole potatoes at the mixer again. In discussions with the OEM, they suggested hashed or cubed potatoes would be fine. The main issue is the amount of total allowed seal deflection, which in the horizontal, even with a
On all accounts we’re very happy with our transition to In-Mash milling and we’ll continue to use it going forward in our distillery. If you want to learn more, please reach out to Scott Turbon at www.scottmixer.com. We fully recommend their solutions to your In-Mash needs.
John McKee, along with his wife Courtney, are the owners of Headframe Spirits in Butte, MT. When not ruining high shear mixer caused by entire potatoes. seals with big-assed potatoes, John is floating rivers in MT in the We promptly ran 5000 lbs of hashed potatoes and everything “death boat” with everyone else’s kiddos. For more information email ran smoothly, with no issues. email@example.com. modified seal, isn’t great enough to allow for shaft deflection
American Craft Spirits Association
Where Past is Prologue 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
hange is inevitable. This is particularly true in a
Distillers Group of DISCUS, reflects, “Several words come to
membership organization composed of entrepreneurs.
mind that describe Penn best and his impact on the Craft Spirits
Successful craft distillers perceive an opportunity and through
Industry. Penn is a passionate, connected, worldly, and wise
hard work, creativity, investment, solid hiring, and some luck,
person.” Ted explained that he first met Penn in 2003 when
make their businesses work.
he walked casually into his distillery and asked for a behind-
The American Craft Spirits Association (ACSA) operates in a
the-scenes tour. Ted remembered that his first impression was
similar manner. In 2010, a thought gave way to discussions
Penn’s enthusiasm for the craft spirits industry as Penn spoke
among some of the industry leaders about forming a non-profit,
with conviction about distilleries around the world. As one of
member-driven/member-owned trade association. In 2013,
ACSA’s founding members, Ted worked closely with Penn to
ACSA (formerly American Craft Distillers Association) was
define and implement a vision for ACSA. Ted explains, “Without
born. Pennfield “Penn” Jensen, an industry pillar, was a part of
a doubt, I can confidently say that all craft spirit producers in
that birth as its first Executive Director, and invested his time,
future generations will know the impact that Penn Jensen has
energy, and passion to lead the organization through its infancy
had on craft spirits. My sincere thanks to Penn for his time
into those early toddler years.
and dedication and I look forward to many more engaging
Penn, together with a team of passionate distillers and a
conversations in the future.” We share Ted’s view and reiterate
small staff, made ACSA work. They crafted a set of Bylaws and
our collective gratitude for Penn’s contribution to the craft
built a Code of Ethics to lay the framework for an organization
that embodies its mantra: “Member Owned—Industry Driven.”
In February, when Penn announced his impending departure
However, change is inevitable, and on August 1, 2015 Penn
at the ACSA Convention in Austin, Texas, Margie A.S. Lehrman,
retired. As we celebrate his career, Ted Huber, Vice-President of
an attorney with Lehrman Beverage Law, PLLC, was sitting in
ACSA, President of Starlight Distillery, and Chair of the Small
that audience. She attended to learn more about craft distillers and trends in the industry. Little did she know that ACSA’s Board of Directors would soon, after an extensive search, be asking her to join ACSA as its Interim Executive Director. With almost 20 years of executive association management experience in both New York City and Washington, D.C., Margie is an integral part of the process of change and growth. She combines her zeal for our membership organization with her knowledge of the beer, wine and
Colleen Hanley (O-I), Mark McDavid (Ranger Creek Brewing & Distilling) , Judi Gribble (O-I), T.J. Miller (Ranger Creek Brewing & Distilling), Danielle Catley (O-I) and Penn Jensen at ACSA’s 2015 Convention.
spirits industry. She knows what it takes to open a distillery, having assisted
Scenes from Taste the Revolution at 2015 Tales of the Cocktail. 1 Margie A.S. Lehrman (ACSA), Trey Litel (Louisiana Spirits), Leah Hutchinson (ACSA), & Brian Christensen (Artisan Spirit Magazine). 2 Jeremy Kidde & Jason Grizzanti of Black Dirt Distillery. 3 Andy Nelson of Nelson’s Greenbrier Distillery. 4 Tom Mooney of House Spirits. 5 Will Atkinson, Austin Reese, & Jason Ingram of Corsair Distillery. PHOTOS BY ANDREA HUTCHINSON
a number of clients launch their alcohol businesses, from inception, incorporation, and licensing, through production. She understands how difficult it can be to navigate this heavily regulated industry. “Interim” status is necessary to allow Margie the time to transition current 1
clients, but she has already begun to take steps to make ACSA the craft distiller’s primary industry resource, and an organization that provides the services and benefits needed to be truly prosperous in this business. Under the new leadership, ACSA’s Legislative Committee will continue
to focus on federal excise tax legislation. In addition to continuing to work with the Distilled Spirits Council (DISCUS), whose joint advocacy on the FET reduction effort was announced in March, ACSA also hired the Pennsylvania Avenue Group to ramp up ACSA’s legislative efforts. The firm is headed by Jim Hyland, a 20 year veteran of Capitol Hill, who has been a friend to the industry for the past year in helping design ACSA’s lobbying initiatives. Jim was a legislative director to U.S. Senators from Texas and North Carolina and worked for the House Financial Services and Senate Banking Committee for 12 years. Having worked in both the House and Senate, he provides a unique perspective on how Congress works. Additionally, he has practiced law and lobbied for a number of institutions, trade groups, nonprofits, small businesses
and a major University. Together with DISCUS, collective efforts have secured key sponsorships of the Federal Excise Tax Reduction bills by the tax writing Committees in Congress, Senate Finance and House Ways and Means. Change was not limited to ACSA personnel. In July, ACSA made its first “official” appearance at Tales of the Cocktail, an annual event that brings together thousands of industry professionals. ACSA member distillers hosted a tasting room called “Taste the Revolution”. These members are the risk-takers, the distillery owners who are revolutionizing the industry one small batch at a time. The festival provides a perfect snapshot of what’s on-trend and on the horizon in the spirits industry,
and craft distilling is integral to its future. The one constant—unlikely to change—is ACSA’s steadfast commitment to who we are: the only registered non-profit trade association dedicated to promoting and protecting the craft spirits producers throughout the United States. As we say our fondest farewell to Penn, we know where we’ve been and look forward to even greater things to come.
Visit www.americancraftspirits.org for more information on the American Craft Spirits Association and to join.
WHOLE W HOLE PACKAGE PAC K AG E
A ONE-DAY WORKSHOP ON SELECTING THE RIGHT BOTTLE, CLOSURE, AND LABEL FOR YOUR SPIRIT.
Just a few questions you can expect to have answered:
» » » » » » »
When should I start designing my packaging? How should I budget for packaging? How do I tell my story with packaging? Do we have to purchase in bulk? How can I maximize shelf appeal? How do I measure packaging success? How do I update or redesign my packaging?
WHERE: Moonshine University in historic Louisville, KY. WHEN: 9am-5pm on November 13, 2015 WHO SHOULD ATTEND: Anyone interested in learning more about the art and science of packaging their quality spirits.
HOW MUCH: $75 covers a full day of invaluable brain dump from industry experts, study materials, and lunch. WHAT NOW: Workshop space is limited, so....
EMAIL INFO@ARTISANSPIRITMAG.COM TO SIGN UP TODAY!
OREGON STARKA PROJECT WRITTEN BY AMBER G. CHRISTENSEN-SMITH
WORKING TOGETHER TO INTRODUCE AN OLD WORLD SPIRIT TO AMERICA and the TTB.
ost craft distilling businesses can attest to the great
whiskey…something that would involve barrel aging,” shares
friendships they have forged with other distillers, and
Medoff. He had tried the concoction during his travels to Russia
many become close-knit units as they grow in the spirits
and Poland and he really liked the idea. “While we’ve not exactly
industry. Yet, how far will they take their relationships? We see
cemented a new spirits category in the US, we believe we’re
many mentoring each other, recommending their products, and
onto something,” continues Medoff.
working on legislation together. However, we don’t often hear
“We all knew there was a hole in the vodka category that could
about collaborations amongst craft spirit makers with the express
be filled by a unique product like Starka,” continues Mark White
goal of bringing forth a wholly unique product line. So when we
of Indio Spirits. “After talking to Lee from Bull Run about what
were made aware of the Oregon Starka Project, a partnership of
the tradition of Starka was, we performed our own research and
not just two, but three individual distilleries—Indio Spirits, Bull
found there was not a lot out there about the style.” White shares
Run Distilling, and Big Bottom Distilling—it was time to dig
they really had to reinvent and resurrect their own variation of
deeper into how a collaboration of this size can work.
Starka. Ted Pappas of Big Bottom concurs: “It’s very difficult
The history of Starka dates back to the Seventeenth Century
finding any information on Starka, which hindered us from doing
and was first developed in Poland and Lithuania. A dry rye grain
any type of research on it. We knew the basis for Starka and
vodka is produced and aged in oak barrels (sometimes with
decided to create our own interpretation of what we thought an
linden tree or apple tree leaves), and produces an alcohol that
Oregon Starka could offer.”
— at somewhere around 70-80 proof—offers sweet and spicy
Each distillery began by making their own vodka base and then
flavors and a smooth texture. Historically, Starka was made at
placing this liquid in different barrels and aging it for varying
the birth of a child, and then buried in the backyard in oak
lengths of time. Completing a similar yet unique process ensured
barrels that had previously aged wine, to be dug up and enjoyed
each product had something in common and offered distinction.
at this same child’s wedding.
While Starka has a tradition of being aged in oak barrels which
The idea for the Starka project came from the three distillery
previously housed wine—something all the distillers used in
heads brainstorming ideas that might bring them together to
variations—they interpreted the aging process differently as
create something that was both new and unique in the market.
they intended to move the product to market somewhat sooner
Lee Medoff, of Bull Run, threw out the idea of Starka—“It
than in two decades, as is done in Eastern Europe.
was something that would bridge the gap between vodka and
Bull Run used Oregon Pinot Noir barrels from King Estate
Winery and Rye Whiskey barrels from Indio Spirits. “Based on
to help the TTB understand the properties of the traditional
sales of our Starka we definitely have a hit on our hand—we
spirit and that it was a barrel aged vodka. They were finally able
can’t wait to release the second batch,” shares Medoff. Medoff
to include “vodka” on the label, but had to use the verbiage of
kept Bull Run’s variation, Medoyeff, traditional by preserving
“finished” instead of “aged” on the label due to the time frame of aging the Starka.
the grain’s character. Big Bottom used zinfandel barrels, which had previously
After wading through the many obstacles with TTB, the
housed their bourbon, to age their vodka. Finishing products
distillers were elated to finally share Starka with the world.
in wine barrels is something they regularly do so it only seemed
The Uncloaking of the Oregon Starka Project—the first known
fitting. “We chose zinfandel barrels for the Starka project as we
production of the spirit in the US and done as a trifecta
felt the peppery traits of the zinfandel would add depth to the
collaboration—was well received at TOAST 2015. “It made
neutral spirit,” shares Pappas.
perfect sense to launch the Oregon Starka Project at TOAST
Indio’s Starka was aged in ex-rye barrels. “We then add French oak and applewood staves,” shares White. “Traditionally Starka
since it was a spirits show hosted by the Oregon Distillers Guild,” explains Pappas. “It was mutually beneficial for the project as
is aged in ex-wine barrels, but since Bull Run and Big Bottom
well as TOAST as we were able to unveil the products with a
were already doing that we decided not to. White explains that
captured audience. In return, the show was able to have an
the Starka was in barrels for sixteen months and has great fruit,
added attraction for attendees.” The distillers had the pleasure of educating their patrons
vanilla, and oak profiles. Working together on Starka not only meant making a new
at the event and everyone was curious about the brown vodka.
spirit, but also working with current particularities with the TTB. “They were floored by the flavor and color of Starka,” states Getting Starka recognized as a justifiable vodka product required
Medoff. “The receptivity to Starka at TOAST, and since, has
some hurdle jumping. At first, Medoff says, the distillers would
far surpassed our greatest hopes. We wish we had made much
not be able to label Starka as a vodka product, and they would
more.” Pappas continues that, “The comradery of the three
not be able to say it was “aged.” In the end, the distillers worked
distillers sent a very powerful message that Oregon distillers
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enjoy working together for the craft.” White happily adds, “We killed it, and the people will never see vodka as a one-dimensional spirit again.” Medoff notes that the collaboration worked because there were no egos causing roadblocks. “We’re all friends and pretty low key. That’s why we selected who we selected.” Although the three distillers have their own distinct
extend their unity of the project by having the same cap strip on all three brands that ties the three creators together. Additionally, Medoff shares that other distillers in Oregon have expressed an interest in joining the Starka exploration. The group would love to grow the category in Oregon and hopefully beyond their state. “I loved the collaboration,” adds White, “Distillers usually see each other as
OTHER DISTILLERS Tips from Mark White, Lee Medoff, & Ted Pappas: • Check your ego at the door • Establish a plan (and set time aside to
do so) and agree on the desired result • Don’t aim too high—go after something
achievable and build from there • Be ready to put in your fair
share of elbow grease • Communicate, communicate,
communicate • Create something unique
and have fun with it
competitors and guard their operations
jealously, but in this case we really are friends, the three of us.” The group plans to work on another collaboration. Pappas says, “We’ve already laid down the next batch of Starka and will continue with the Oregon Starka Project.” However, they don’t want to divulge too much about future endeavors. “At the risk of being coy, that’s all we can say for now,” says Medoff. “What really worked was that we all wanted to help each other and learn from each other and bring a distinctive product to market,” White finishes. The distillers are proud of their group and their creation and have really set a great example of how to collaborate.
For more info, visit...
Big Bottom Distilling
Bull Run Distilling Company (www.bullrundistillery.com)
Indio Spirits (www.indiospirits.com)
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GREAT TEAM WRITTEN BY MAGGIE CAMPBELL
s craft distillery culture progresses in the US, many
Many distilleries are hiring trained chemists, but the adage
companies find themselves needing to add employees to
“You can miss the distilling forest for the chemistry trees” still
their core team. Suddenly you are going from a company of a few
rings true. John Jeffery, a consultant of Chicago Road Spirits
deeply passionate founding members to one that is adding guns
(formerly of Death’s Door), points out that you literally have to
for hire. Finding and attracting talent from a small community
teach them how to flick switches on pumps as well as understand
with few career development resources can be challenging
your goals. It can be hard to hire a trained chemist and convince
enough. Now add long hours, tight budgets, and hard physical
them to do things a certain way to meet the company’s needs.
work, all in a field where new distilleries are trying to poach your
Their knowledge of chemistry does not always mean they have
knowledge of barrel maintenance, packaging concerns, or
How are we to attract new talent, welcome them into the team,
developed technical tasting ability. You need to be very aware of
and retain their skills once we’ve invested in their development?
what training they will need as their deep chemistry knowledge
Well, thinking critically about what image your brand sends out
may lead you to believe they need less support in practical
into the hiring pool, identifying core values and experience,
distilling matters. Hiring a chemist can lead to a great employee,
making a new employee feel like a part of the tribe, and looking
but do not think they will be ready to go out of the gate.
for diversity may just be the keys to not only building a great team, but also building a lasting one.
FINDING NEW TALENT
If one hires a brewer they will have basic brewing knowledge including use of equipment, safety training (especially forklift and CO2 exposure), and some olfactory development. However, much training will still be required. Brewing for distillation is
Do you want someone with experience? Being that home
different, with distinct considerations for pH, lees management,
distilling is illegal and few schools offer comprehensive training,
and microbial protection. Brewing is also a few days in the life
this is becoming a question that leads to two very different roads.
of a spirit. They will need distillation training, ripening, and
Often, getting someone with quality distilling experience requires
barrel training. The technical skill involved with a proper barrel
poaching—a very expensive, dicey, and political proposition.
program mimics wine, especially fortified wines, far more than
Hiring someone with little experience means investing heavily in
the mash process mimics beer brewing, yet few leave the wine
training for the long haul (think years not months or weeks). It
industry to pursue distilling. Dave Smith of St. George Spirits’
also means inherent blind spots be it in science, safety training,
incredible breadth of skill, including technical tasting, clearly
or basic warehouse operations.
stems from his time in the wine industry.
of Montanya Distillers, attracts many talented women to her
Thinking critically about what
company because they are sent a clear message that they are
image your brand sends out into
in management at the company. If your brand has a skimpy-
welcome and will be taken seriously, as they see a visible woman
the hiring pool, identifying core
dressed female placed objectifyingly on your label then you are
values and experience, making
hiring (and consumer) pool. Not only will you turn off potential
a new employee feel like a part
males. Don’t we all want to attract the largest pool of hard
sending a message about how you value women out into your women hires (51% of the population) but also female-positive
of the tribe, and looking for
working, talented, and driven potential distillers to choose from?
diversity may just be the keys to
By being in a vacation ski town she knows her employees want
Hoskin also offers specific benefits that meet her staff’s needs.
not only building a great team,
to get out on the slopes, as well as escape in the spring to soak
but also building a lasting one.
a must to retain talent in a ski town. She pays a much higher
up some warmth. They are given ski passes and paid time off, wage than the surrounding businesses because she knows that her seasonal consumers will return yearly during resort season.
Let’s be honest, no one is ever finished with their distilling
Having low turnover is the best way to please her customers
training. Even hiring a distiller from a specific spirits category
and keep her employees happy. Little details like that can go
means possible blind spots in another category. This can lead to
a long way with a small company working on a budget. It can
even more problems as they may come with a base knowledge
get talent to sign on when they feel like the management has
they do not want to stray from. What is familiar is easy, after all.
thought about their needs.
If someone is experienced in a particular spirit, ask what other
Hubert Germain-Robin also encourages hiring a crew with
spirits they are passionate about, what other types of distilleries
different cultural insights than yourself. He declared the best
they have visited. Every aspect of production differs by spirits
assistant he ever had brought a different cultural background
category, so ask: what original insights can they bring to your
to the company as a gay man. The assistant also happened to
spirits category? How willing are they to learn new things?
be more effeminate, complimenting and contrasting Hubert’s
St. George Spirits has one of the most diverse teams in
machismo. He says that his assistant’s input, “helped me to
the field, encompassing different ages, genders, and cultural
look at things differently. Little details were illuminated and it
backgrounds. Smith says it happened organically because they
was very valuable learning.” He went on to describe that the
were open to talent from everywhere, as long as they met the
experience taught him a lot about ways he had been limiting his
company culture. He explained that he can teach anyone skill
perceptions. He also feels, “It is very important for women to
sets, but he can’t teach personality and social skills. He looks
be welcomed into production. They offer sensibilities that make
to hire people who can really make the company part of their
a spirit stronger and the marketing stronger—it allows you to
life and make the team their chosen family. If they can’t make
reach more people. Different ideas working together makes for
that leap they will come, but they will go. A larger team making
a better house.”
a variety of dynamic products requires trust up and down the company structure. You have to give it to get it.
All of these thoughts are very encouraging to take the opportunity to explore and seek out staff from varied cultures
How can you give yourself a huge advantage in hiring the
and backgrounds. It may not be an obvious first thought in your
best employee? You can critically assess how you attract talent.
hunt for employees, yet this can bring more strength of skill and
When someone looks at your company, do they see themselves
a wider range of tools to your staff. Having similar core beliefs
welcome or reflected there? How many people see a top notch
is a must, but diversity around the mission makes for a more
organization that they will proudly declare they work for?
Great distillers come from everywhere, so make it clear that
As important as it is to hire the right people, it is just as
your doors are open to all of them and you will have the pick of
important to avoid hiring the wrong people. Being desperate, or
the top talent. For instance, Karen Hoskin, Owner and President
in a rush, may be the worst position possible in hiring new talent.
“Bringing in the wrong person can change everything,” says
the perfume industry the head nose and assistant nose never
Karen Hoskin. She is right, and many distillers have witnessed
travel together for fear of an accident. Hubert says that transfer
this first hand. Your distilling team is your family, and introducing
of knowledge is necessary in companies for the same reason. An
maladaptive behavior can become a widespread infection. When
educated staff is a strong staff.
I meet someone from a team and they badmouth, sell-out, or
It may be hard to imagine your small operation having an office
engage in negative speech about their team there is no bigger
staff, or so many employees that some would be involved in only
turn-off. It’s a loud screaming warning sign that the dynamic,
one part of the production, but we all know distilling is a long
camaraderie, and morale is low. You have to avoid introducing
distance sport. Many of the people contacting me are asking
poison if you want your company to stay healthy.
about these ideas because their growth snuck up on them. It is
WELCOMING THEM INTO THE TEAM John Jeffery points out that distilleries “are very tribal.” Once
always better to be prepared and start thinking now.
you have made a hiring decision, you are adding to your tribal unit
“You can’t poach someone if they love where they are,”
and you must welcome them as family. Your founding members
John Jeffery reiterated throughout our interview. Poaching
may have a long history and years of experience investing in
is a serious concern when you have hired staff. Many of your
a shared dream, so how do you bring this person up to speed
founding members may have their financial or emotional hat
with your mission? Jeffery encourages confirming that they have
in the ring, but new hires may not be as invested. Training a
a respect for investment. They may see money spent on nice
staff member takes time, energy, and money. Do you really want
machinery and equipment and feel like they deserve some of
them to walk away and have to start over with someone new
that cash. You need to be sure to continually reflect the respect
after two short years? Many distilleries I talk to discuss holding
for the investment and the state of the business to them. If they
back information as a way to keep their production details
understand, honestly, where the business stands and where you
safe in case a staff member leaves, but often this only serves
want it to go, it will keep them focused on the future with you.
to create a disconnection and escalate the probability of the
They will also be happier if you allow them to do their job.
staff moving on. It also stifles the staff’s ability to be promoted
Jeffery and Hoskin both point out that a clear job description,
and therefore stifles management’s ability to move upwards and
quality training and comprehensive operating instructions are
concentrate on their growing business instead of production.
key. Workers enjoy clear direction and feeling confident that they
You have to offer quality training and upward mobility as a way
have accomplished their work. “They need a strong foundation
to develop a distiller’s skills or they will go where they are given
on what they need to do their job,” Jeffery says.
that opportunity. New, well-funded distilleries are opening at a
Things can change fast at a small start-up business and
surprising pace. Often they find it less of a hassle to poach a
people need to have a high tolerance for change, Hoskin points
trained distiller and get production rolling than to hire, sculpt,
out. With this comes your management responsibility to clearly
and train a staff. Is your company paying to train their future
communicate that change and check in with your employees’
staff? Don’t want to? Then actively retain your employees; it
needs. Hoskin added, “I constantly ask for feedback. Just
doesn’t happen on accident.
because they were set a month ago doesn’t mean they still are. The job is constantly changing.”
Dave Smith of St. George lists three prime components for retaining a talented team. First, they have to have challenge
When Germain-Robin is doing employee training as part
and growth potential. Second, they have to find happiness and
of his consulting he always brings in as many people from
satisfaction. Third, they need to be paid well. If an employee has
the company into those trainings as possible. He feels it
all three they will happily stay. If they have two they are doing
is important to have more people involved so everyone has
alright. If they have only one you can bet they will move on.
perspective about the work being done at the company. This will
Hoskin believes that allowing employees creative expression is
allow an understanding throughout the company of the chain of
a valuable way to connect them to the team in a lasting way. If
operations and strengthen even the office staff who may not be
you allow them to be part of the creative process then they will
involved at the distillery at all. It helps to solidify the mission if
want to see where that work goes, and what product it becomes.
everyone is excited about the company as a whole. This is also
“Side projects can play off of their core skills and competence
critical in case something should happen to a staff member. In
so they feel extra strong and confident about this work and it
You can’t poach someone if they love where they are.” — JOHN JEFFERY
fuels them.” She also points out that it is vital to pay them what they are worth and treat them and their time with respect. Her employees are the lifeblood of Montanya and she reaffirms to them that she cannot run the company without them. She also switches up the team’s days. Instead of having specialists in
each area of production they all do a little bit of everything. This keeps everyone rooted in the final product instead of focused on just one part. It also keeps their mind fresh and avoids burnout. Johnny also says it is important for people to get out with the sales team. You can’t become the distiller in the cave scoffing at the outside world. You have to see people connecting to your spirit to bring in fresh energy and also experience their feedback and see how they perceive the spirit. He feels everyone has to get out of their wheelhouse and contribute to every part of the company in some way—it reinforces the tribal nature. Participation is respect, and as the company grows you need to take time to participate and respect each part.
CONCLUSION How do you find someone with metal work, electrical, and plumbing training who can also discuss the finer points of fermentation, distillation, and manage a barrel elevage program, who also has developed their palate for detecting common flaws, concentration, complexity, finesse, balance, and quality, who also understands packaging, the management of distribution expectations and can direct a comprehensive safety program, all while doing the dishes, cleaning the bathrooms, and complying with the TTB? Well, the chance of finding this new dream employee, who is available and looking for work, and happens to click with your project can be pretty slim. Keep your doors open to a diverse field to have the best chance of attracting talent. Once you get them, treat them right and make them part of your vision for long term success. It’s like Jeffery says, “Who you work with is who you spend your life with.”
Maggie is a current Masters of Wine Student and Head Distiller Vice President, at Privateer Rum. She currently serves on the Board of Directors of the American Craft Spirit Association and co-chairs their Education Committee. She previously worked as assistant distiller at Germain-Robin. Her advice for aspiring distillers: “Read all the books you can and knock on every distillery door you can get to. Having mentors with different philosophies gives you a whole world of tools to pull from.”
TIPS FOR THE COLA PROCESS BY MARC E. SORINI
lmost every distiller, from the smallest to the largest,
Marc E. Sorini is a partner in the law firm of McDermott Will & Emery LLP, based in the Firm’s Washington D.C. office. He leads the Firm’s Alcohol Regulatory & Distribution Group, where he concentrates his practice on regulatory and litigation issues faced by supplier-tier industry members. His practice for distillers includes distribution agreements, distribution counseling and litigation, product formulation, labeling, promotional compliance, compliance strategy, and federal and state tax and trade practice enforcement defense.
Products containing a manufactured flavor require even more
must navigate the Certificate of Label Approval (“COLA”) diligence, as TTB requires that flavors and extracts used in the
process administered by the federal Alcohol & Tobacco Tax & production of a distilled spirit obtain TTB approval before such Trade Bureau (“TTB”). Federal law requires that the labels of flavors and extracts can be used to produce a distilled spirit. all distilled spirits (excepting spirits for non-beverage use) be The major flavor companies (such as Givaudan, IFF, Syrmise and reviewed and pre-approved by TTB before a distiller can lawfully others) generally have substantial experience with this process use such labels in “interstate commerce.” As the law considers and routinely obtain TTB approval of their formulas before any commerce between states (at least) to qualify as “interstate offering them to customers like distillers. But, as with the need commerce,” as a practical matter for distillers this requirement for a beverage formula itself, the failure to obtain a formula for a to obtain a COLA is nearly universal. Because the process can flavor to be used in, for example, a flavored whiskey, will impose frustrate marketing objectives and/or cause delays in product additional delays in the process if TTB rejects a beverage formula introduction, a distillery would do well to learn the process and due to its use of an unapproved flavor. work to minimize surprises and problems.
For products requiring formulas, the formula approval process can have a significant impact on labeling decisions.
NECESSARY PREREQUISITES – FORMULAS If, for example, the distiller wants to make a label claim about A subset of distilled spirits must have their recipe and method a particular ingredient in the spirit, the formula should clearly of manufacture reviewed and approved by TTB before TTB will identify this ingredient in order to substantiate the ingredient even consider a review of the product’s label. For domestic claim during the COLA process. Similarly, if a distiller wishes to products, the approval is called a “formula,” while imported label a product as a particular TTB “class” or “type” of product, products must obtain a “pre-import approval”, PIA. Distillers, the formula application should be crafted to obtain this class/ then, should become familiar with which products require type designation during the formula approval process. In short, formulas. If a COLA application is submitted to TTB, it may take distillers should keep labeling and marketing considerations in weeks or even months before TTB reviews it, and a rejection the forefront during the formula application process. based on the failure to obtain a necessary formula (or PIA) can waste significant time before the legal introduction of a product. Domestic distilled spirits requiring formula approval prior to even starting the COLA process include:
Today, the vast majority of formulas are submitted online through TTB’s COLAs Online system. While there remain a few
• Flavored vodkas, whiskeys, brandies, and other flavored instances where a distiller (or its counsel) should consider an products.
old-fashioned “paper” filing, online COLA applications generally
• Any product not recognized as falling within one of TTB’s receive faster review than paper applications. To use COLAs class/type designations (often known as “distilled spirit Online, however, a filer must establish a COLAs Online account. specialty” products).
• All liqueurs. • Certain whiskeys.
This involves an application and requires the filing of Signing Authority or Power of Attorney documentation for the actual persons authorized to submit COLA applications on behalf of the
company. Companies should authorize the appropriate persons labeling regulations must remain a topic for another day. But as to file COLA applications on their behalf at the start of their a practical matter, a review of the label prior to submission can interactions with TTB.
prevent unnecessary delays later in the process and maximize
TTB’s process for authorization still focuses on individual the chances of preserving a particular marketing objective or persons, not companies. As a result, companies should not “put concept. As a brief and simplified refresher, TTB’s regulations mandate
all their eggs in one basket” and should, instead, identify at least
two or three individuals to act as authorized COLA submitters to the following information: TTB. Including outside regulatory counsel in such authorizations
On the “Brand” (generally front) label:
can save time when the company decides from time to time that
• Brand name • Class/type designation • Alcohol content
it needs the help of counsel to get a particular label through the process.
On any label:
THE COLA FORM – TTB FORM 5100.31
• • • •
Once a distiller has obtained any necessary formula approvals and authorized representatives to file on its behalf, it is time to prepare the actual COLA application. Applications—both online and papers—are submitted to TTB on a specific form, TTB Form
Distiller/bottler name and address Net contents (in rare cases required on the front) Coloring and flavoring disclosures, if applicable A percentage of neutral spirits disclosure on certain class/types, if applicable
5100.31 (the “COLA Form”). Like most TTB forms, the COLA
• Age statement, if required • State of distillation for certain whiskeys • Several other minor labeling disclosures (e.g., sulfites,
Form is available in the forms section of TTB’s website, TTB.gov. While perhaps obvious, distillers should pay attention to the instructions on the COLA form. Simple mistakes and, worse,
FD&C Yellow 5), if applicable
omissions on a COLA application can cause easily-avoided delays.
TTB’s rules on prohibited labeling statements and claims can
TTB occasionally updates the COLA form. While TTB typically be even more daunting. At the highest level of generality, the accepts applications on a newly-obsolete COLA form, the Agency regulations prohibit any statement that is false or, even if eventually rejects new applications filed on obsolete forms. true, is misleading. Of course, determining what The persons in charge of submitting new COLA forms should constitutes a misleading statement involves occasionally check the TTB.gov website to ensure they continue a great many subjective judgments, to use the current COLA form.
Another frequent cause for delay can arise by not submitting regulations also contain a myriad the correct file type and size when submitting the label images of
to be reviewed. TTB requires a file type of JPG or TIFF (file involving
extensions: .jpg/.jpeg/.jpe or .tif/.tiff), not PDFs. The electronic statements and claims ranging file cannot exceed 750KB in size, must have a compression/ from the general (health-related quality ratio set at medium (7 out of 10 or 70 out of 100), and statements) to the very specific utilize colors in the RGB color mode, not colors in the CMYK color (the word “pure”). mode. Finally, TTB will not accept an image with surrounding
To make matters worse, TTB
white space or printer’s proof detail, which must be cropped out labeling decisions often rely on before submission.
PRE-SUBMISSION LEGAL DILIGENCE
DETERMINING WHAT CONSTITUTES A MISLEADING STATEMENT INVOLVES A GREAT MANY SUBJECTIVE JUDGMENTS, MAKING CLARITY DIFFICULT.
Circulars” or, even worse for the uninitiated, TTB’s distilled spirits labeling regulations contain a host of unpublished “bottom drawer” rules. While provisions. In general, these can be lumped into two broad predicting TTB label review decisions can prove extremely categories: (a) “mandatory information” that a label must difficult, careful legal due diligence can help avoid problems up contain, and (b) prohibited words, phrases and concepts that a front. No simple checklist can capture this process, as decisions label cannot contain. A full exploration of TTB’s distilled spirits prior to submission must factor in the perceived importance of
a particular claim, image or statement, the likelihood and basis application is a source of much frustration. Today, the COLAs for a TTB objection, and the relative need to avoid the delays
Online system lumps almost all waiting COLA applications into
if an initial COLA application needs correction, rejection, or
the generic category of “in process.” In general, too many inquiry
calls and emails can wear out a distiller’s welcome at TTB. But in
The point is that distillers should avoid the frequent trap cases where an application has been pending for a considerable of thinking that because TTB will review the label for legal
amount of time, a distiller should consider escalating the
compliance, the COLA application process is simply one
communications in an attempt to “shake loose” the COLA. In
of “throwing spaghetti at the wall and seeing what sticks.” doing so, having a counsel or TTB compliance consultant familiar Wise distillers take a strategic approach to label submission with the players and processes at TTB’s Advertising, Labeling that includes an evaluation of TTB’s likely position towards a particular label.
and Formulation Division (“ALFD”) can prove extremely helpful.
In both the paper and COLAs Online environment, TTB
Today TTB publishes on its website information on the average
generally responds to COLA applications in three ways: (a)
processing times for COLA and formula applications, with
approval; (b) “needs correction” (COLAs Online) and rejections –
information specified by commodity (i.e., distilled spirits, wine,
a rejection with a brief statement of reasons; or (c) approval with
and malt beverages). Keep in mind that times provided represent one or more “qualifications” – limitations on use or instructions averages – there is no guarantee that TTB will
on changes that will be required upon the next label printing. In
process a particular formula or COLA within
the online environment, failure to respond within thirty days to
the stated average. Moreover, approval WISE times vary with a myriad of factors, DISTILLERS including TTB staffing challenges, TAKE A vacations (turnaround times STRATEGIC generally slow around the holidays APPROACH TO and during the summer), and LABEL SUBMISSION other factors. Educating yourself THAT INCLUDES AN about processing times at the EVALUATION OF TTB’S start of a product development cycle will help avoid unwelcome LIKELY POSITION surprises and frustrations later in TOWARDS A the process. PARTICULAR In special circumstances, TTB LABEL.
a “needs correction” notice will result in a rejection of a label,
effectively putting any subsequent application for a modified label at “the back of the queue” of label applications. In the paper environment, a rejection automatically puts the label back into the ordinary queue for processing. Distillers, of course, view approvals as the end of the process. Needs correction/rejection notices and, in some cases, qualifications, are a different story. Since the late 1990s, TTB regulations contain formal procedural rules for appealing TTB label rejection and qualification decisions. In practice, however, these procedures generally require more time to play out than a distiller is willing to wait. As a result, the formal appeals procedures are rarely used, although a formal appeal makes
“expedited” sense in limited circumstances. As a general matter, a decision
review of COLA applications. This requires to invoke the formal COLA appeals process is one best taken with the submission of a letter from the company briefly explaining the need for expedited treatment. Note, however,
the advice of counsel experienced with such matters. Rather than following the formal appeals process, most
that TTB generally does not recognize the need to get to market distillers face the decision of whether to accede to TTB’s faster, without other reasons, as a valid qualification to grant an
demands or engage in a dialog with TTB personnel – dialog
expedite request. Instead, TTB will generally approve expedite
that should be viewed as an informal appeals process. Given
requests where the reasons given relate to forces largely beyond the often-subjective nature of TTB’s rules and the circumstantial the control of the distiller. These include delays caused by TTB’s
complexity of a given label, a dialog can produce a compromise
own processes (e.g., a lengthy delay in processing a formula that preserves (at least partially) the distiller’s marketing goals application), third-party arrangements beyond the distiller’s sole within the bounds of what TTB will accept. Once again, few control (e.g., no trademark license yet), and “acts of God” like
“cookie cutter” rules apply to this process. But understand
storms interrupting distillery operations.
that a TTB needs correction or qualification decision does not
Obtaining meaningful information about the status of a COLA
necessarily represent a non-negotiable decision. Creative and
cooperative dialog with TTB (either with or without the assistance holder from adverse action alleging, for example, trademark of counsel) can help achieve a result reasonably in-line with the infringement. And—as a spate of recent lawsuits illustrate distiller’s marketing objectives.
EFFECT OF A COLA
—TTB approval does not insulate a distiller from claims that its labeling misleads
consumers under false advertising An approved COLA allows a distiller to introduce products into principles. In other words, distillers the market using the approved label with little risk of adverse should view the COLA process as enforcement action by TTB. This general rule comes with two important caveats: The label must conform to the liquid in the bottle (e.g., just because you have an approved label for whisky does not allow you to use that label on a bottle containing vodka). Second, any misrepresentation by the distiller during the course of the label application process (e.g., providing the wrong list of ingredients in the formula application) would undermine the validity of the COLA approval itself. But with those exceptions, a distiller can use the label approved by TTB with little worry that TTB will later claim that this use was illegal.
AN APPROVED COLA DOES NOT CONSTITUTE a necessary and important part TRADEMARK of its legal compliance duties, PROTECTION OR but certainly not the final word. Distillers should also keep SHIELD A COLA HOLDER in mind that TTB is a federal FROM ADVERSE agency and that its decisions ACTION ALLEGING, are not binding on a state FOR EXAMPLE, unless that state has affirmatively TRADEMARK adopted federal law or the federal INFRINGEMENT. process, which many have. While
TTB does, from time to time, determine that a label was most states explicitly or implicitly follow approved “in error.” TTB will often contact the holder of such federal labeling rules, a few (e.g., Kentucky COLAs and ask that they “surrender” the label. Distillers may wish and Tennessee with respect to whiskeys originating to comply for a host of reasons, but they should recognize that from those states) have adopted additional labeling rules.
they have procedural rights before TTB can revoke an approved COLA. If a label is important to a distiller’s business, distillers
Like many other aspects of the distilling industry, the act of
should evaluate their legal rights under these procedural rules putting new labels into the market is highly regulated by rules before agreeing to a TTB request to surrender a particular COLA. that may often seem outdated and/or counterintuitive. But TTB also permits a growing list of changes to labels without mastering the “art” of the COLA application and approval process the need to obtain a new COLA. Knowing what can be changed can provide a real competitive advantage to the savvy distiller. following label approval can help a distiller build flexibility into its Planning, management, and some expertise can avoid delays labeling and branding, as some tweaks will not require the time and preserve marketing objectives in the process of obtaining a and expense of an additional COLA. The “allowable revisions” to COLA approval. labels are spelled out on the COLA Form itself. Note, however, that a COLA does not protect a distiller from a Marc E. Sorini is a partner in the law firm of McDermott Will & Emery host of other potential legal liabilities. Most notably, an approved LLP. Nothing in this article should be construed as or used as a substitute
COLA does not constitute trademark protection or shield a COLA for legal advice. For more info visit www.mwe.com/Marc-E-Sorini or
call (202) 756-8284.
x o F r e p p o C y r e l l i t Dis W
EN BY STEV RITTEN
// PHO SEIM /
MANDA HY BY A TOGRAP
IST JOY CHR
ver the last decade Copper Fox distillery has become one of
whiskies are typically aged between 12 and 15 months. Rick
the leaders among the craft distillery movement. Opened
is proud of the system they developed which involves aging
in 2005 in Virginia, Copper Fox has gained recognition for its
their spirits in upright barrels, facilitated by the cutting of a
products and their unique methods. Owner Rick Wasmund uses
trap door in the top of the barrel. Copper Fox puts applewood
his international learning to keep Copper Fox at the forefront of
and oakwood chips inside the barrels to augment the spirit’s
innovation. We spoke to Rick who told us about where he learned
maturation, which is why a shorter time is effective for their
his craft, how he developed his distillery’s unique methods and
aging program. So far the results have spoken for themselves,
how proud he is of the spirits that result.
with their products winning several awards. Rick said, “We’re
When Rick chose to open a distillery in America that honored the great tradition of Whisky, he decided first to travel to
very happy with it, and the public seems to be, so we’re rolling with that.”
Scotland. While there in 2000, he had an opportunity to learn
Copper Fox currently makes Wasmund’s Single Malt Whisky,
at Bowmore Distillery on Islay. There he learned the added value
a Rye Whisky, and VirGin. Their single malt is made from hand-
of being one of the few distilleries in the world, at the time, to
malted barley after the barley is smoked with apple and cherry
malt their own barley. Rick wanted advantages like that with his
wood. Using a mash bill that includes some of the same smoked
own distillery, and these lessons were invaluable when finally
malts, their rye whisky is aged in used bourbon barrels with oak
starting Copper Fox in 2003.
and applewood chips. VirGin is made from locally sourced grain
Besides just malting their own barley, Rick wanted to further differentiate the process from other distilleries he could find.
and each small batch is slightly different, depending on what’s growing in the distillery’s garden that season.
So he went about developing a special flavor profile utilizing
After a decade in their current location in Sperryville, Virginia,
fruitwood, mostly applewood, to smoke their malt. Another
Copper Fox is expanding to a second locale in Williamsburg.
unique aspect of Copper Fox is their shortened aging time. Their
With their current facility operating seven days a week for the
past year, Rick is excited to get more production running. The new property will have nine buildings, with most serving a single purpose (malting in one, for example, which they also sell on the side to breweries). Rick said that for now their products will largely stay the same, but they will be able to output about four times as much. They will begin moving barrels for storage to the new facility shortly, and hope to be fully operational in the next year. At their current facilities, they only started offering tastings around 2014, well after a law change opened up the opportunity. The reason might surprise you: they live upstairs in the distillery, and the prospect of a large rowdy group, especially on the weekends, was reason to hold off, especially with their young child. Now, however, Rick and his family will move to a new house separate from the distillery at their Williamsburg location, and once that plan was put in place Rick decided it was time to implement tastings. When their second location at Williamsburg opens, there’s no telling how far Copper Fox will go. Keep your eye out for their products if they’re not in your state yet. With their augmented aging using fruitwood and their uniquely smoked malts, Rick plans on taking Copper Fox to new heights.
Copper Fox Distillery is located in Sperryville, VA. For more information, visit www.copperfox.biz or call (540) 987-8554.
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THE IMPORTANCE OF
IN SPIRITS BRANDING
Distinct pricing, clear hierarchy, product connection, and thoughtful planning are crucial for consumer engagement and vertical growth.
roper tiering plays a powerful role for
discounting and to build in an intrinsic
they are ready to splurge for a special
growing craft distilleries. Designing
value proposition by making it more
occasion, they are more likely to purchase
expensive looking than its price.
within your brand—a brand they already
the packaging appropriately for each price point, product type and quality
Top tier offerings need to set themselves
level is crucial in order to avoid confusion
apart as true luxury products, more
amongst the various tiers. When designed
limited and of superior quality. Here, the
properly, a tiered system will help attract
appearance of scarcity and something
consumers seeking products at particular
truly unique is paramount to supporting
price points and provide a strong family
a larger price tag. Often, consumers
look for your brand portfolio. If designed
seeking more premium or icon brands
improperly, products in a tiered system
are more experienced connoisseurs that
envision your brand growing? In the
will be looking for certain luxury cues
future do you foresee adding SKUs such
another’s sales by appearing too similar in
and information on the package that
as flavor extensions, an aged product that
quality or price, or worse, be so disjointed
communicates items such as specific
is in barrel now, or a more affordable or
that brand recognition is not achieved.
distilling methods, ingredient sources,
limited production, etc.
Make sure to discuss your long-term
PROPER TIERING PROVIDES CLARITY FOR THE CONSUMER. For example, entry-level products are often targeted to consumers who are uncertain about what product or brand they should choose. Entry-level packaging should be eye-catching and inviting to the consumer, and should reinforce the product’s quality without over promising. Mid-level
“workhorse” of a portfolio and should be designed with a strong value proposition in relation to the competition. Often, packaging at this level is designed to appear visually more expensive than the actual price point in order to avoid
know and trust.
THREE MISTAKES TO AVOID WITH TIERING
.FAILING TO PLAN AHEAD. Think long-term: how do you
While certainly not all consumers will
goals with your branding team so that the
be able to afford a crème-de-la-crème
design system created easily allows for
offering, proper tiering can allow your
growth and extension into future SKUs
most premium tier to provide a “halo
effect” of quality that extends to your
For instance, if you know that after the
other products. This establishes a value
launch of your primary product(s) that
proposition by leveraging the credibility
you may later add a more premium or
earned by your “top shelf” offering, and
limited offering, you should be careful to
applying it to your entire portfolio.
choose a design that is flexible enough
Properly tiering your brand’s offerings
to be extended without risking confusion
will allow consumers to access your brand
with your existing tier(s).
at the tier that fits into their comfort zone,
Even if you’re unsure of your future plans,
leading to greater repurchase rates and
be careful not to pigeonhole yourself with
brand loyalty. Then, as your consumers
a branding solution that is not flexible and
become more sophisticated or when
easily extendable. Although no packaging
design will last forever, the last thing you
have, the connection to the umbrella
want to do is to be forced to re-design
distributed you may not be entirely in
brand may be bold or rather subtle,
your brand simply to accommodate
control of the final retail pricing. Be
but there should never be a doubt
cognizant of discounting that may be
as to the overarching master brand,
applied by retailers and make sure that
unless there is a specific desire to have
even at the reduced pricing, there is still
a SKU stand apart as its own brand.
.FAILING TO CLEARLY DIFFERENTIATE .BETWEEN TIERS.
Be sure to create significant differentiation between tiers, leveraging both pricing strategy and package design.
a comfortable separation in price between each of your tiers.
Your package designs should not only
.FAILING TO CONNECT YOUR TIERS TO YOUR MASTER BRAND.
clearly differentiate between your tiers,
One of the worst scenarios occurs
but also use the appropriate cues for their
when differentiation between tiers is
respective price points. Be sure that while
too extreme and consumers do not
differentiated, each tier still leverages
connect your SKUs or tiers together as
your brand family’s key equity elements
one brand. Proprietary names, unique
so that there is clear brand recognition
sourcing, limited offerings, etc., all
across your spectrum of offerings.
have a place, but if done to an extreme,
When brand tiering is done correctly,
consumers won’t recognize your various
consumers should be able to easily
offerings as one brand and you’ll miss
ascertain each tier—good, better and best
the opportunity for vertical brand loyalty.
— simply by looking at your packaging.
Depending on the number of tiers you
There are many ways to properly tier brand offerings. Distinct pricing, clear hierarchy, thoughtful planning and proper articulation of your equity elements across tiers will help to ensure consumers know which tier is right for them. Don’t let tiers encroach on one another and stage your brand for vertical growth through your existing consumer base, and you’ll be one step closer to long-term success for your brand.
David Schuemann is the Owner and Creative Director of CF Napa Brand Design. For more information, visit www.cfnapa.com or call (707) 265-1891.
AWARD-WINNING Defiant American Single Malt Whisky INGREDIENTS
WITH INFUSION SPIRALS ® BY THE BARREL MILL® • Natural Mountain Spring Water • 100% Malted Barley • Specially Cultured Yeast AND Patented Oak Infusion Spirals® by The Barrel Mill®
“Now, thanks to Oak Infusion Spirals by The Barrel Mill, we’ve completely replaced barrel aging. That’s how Defiant Whisky has revolutionized the maturation process.” —TIM FERRIS - DEFIANT FOUNDER, DISTILLER
VISIT INFUSIONSPIRAL.COM AND DEFIANTWHISKY.COM FOR MORE INFORMATION.
12/2/14 5:03 PM
SWEETGRASS WINERY & DISTILLERY WRITTEN BY AMBER G. CHRISTENSEN-SMITH
inding the perfect location for a distillery can
be a daunting task. New business owners often
PHOTOS PROVIDED BY SWEETGRASS WINERY & DISTILLERY
helped them drive their desire to start their own winery and distillery, something Keith knew he would always do.
worry about how the community will react to their
One after another, farmers and their families filed into
application for starting such a business in their
the town hall as the Bodines prepared for opposition. “At
neighborhood—especially a small, conservative,
the start of the meeting there must have been 30 people
there to comment on our permit,” shares Constance.
“Keith, looking pale and green, at the same time stood
Sweetgrass Winery & Distillery, were in this exact
and gave the community and the selectman a review
boat when they went out on a limb (or pasture, if you
of our plans.” To their surprise and satisfaction, the
see fit) and applied for a permit to start their business
first farmer stood and shared his thoughts on the land
in Union, Maine. It was a scary thought that they were
use. “He spoke and told the board, ‘We are losing our
planning to build a craft distilling business in Maine—
farmlands and families—here is a business that wants
one of the last states to repeal prohibition laws and a
to use the farmland and farm products—approve their
strongly conservative area. So, as it goes, the Bodines
permit’.” Constance continues: “One after another they
found themselves at the local town hall meeting on a
spoke of their land and farms’ loss to debt and housing
snowy day in February, ready to nervously defend the
developments and that we should be allowed our permit.”
application for Sweetgrass Winery & Distillery.
Many deep breaths later, the Bodines have worked to
The journey to this make or break community meeting
build a marriage and a family, and a business of wine
had already been a long one. They began with educations
and craft spirits on top of that. They now have 10 years
in engineering, sensory analysis of wine, food science
of experience under their belts of running their own
enology, and distillation classes, and had worked to help
business, and 18 different wines and spirits moving out
others build wineries and distilleries before deciding to
their doors. The Bodines of Sweetgrass have kept their
go out on their own with Sweetgrass. The experience
promise to the community and are proud to share that
they are using 70,000 pounds of fruit and grain grown in Maine, and they love supporting their state farmers. Their Black River Gin, Cranberry Gin, Three Crow Rum, and Smashes are of particular popularity. Their dedication to using Maine products is paying off because customers want distinct items from Maine when they visit. Their dedication and desire to support the community and the industry hasn’t waned. Recently, they have formed the Maine Distillery Guild and are working on pushing new legislation in their state. They have worked for years on legislation so this was a natural progression to meet the need of the growing Maine craft distilling industry. Specifically, they recently lobbied to change the course of one penalty: “We received an email from BABLO, the Maine alcohol control board, regarding their plan to penalize us if our products are out of stock. We sprang into action as a guild with members contacting senators and legislators and the governor. We were able to at least temporarily change their penaltydriven course,” stresses Constance. It is with this commitment to their growing group of distillers in Maine that helps all distillers benefit—and they are happy to not compete with other area distillers, but to instead uplift them. “Other distillers in Maine are not our competition—we happily send customers their way at every opportunity. Our competitors are liquor and grocery store shelves PHOTO BY ROBERT MITCHELL PHOTOGRAPHY
filled with alcohol made somewhere not in Maine. We set up our place
to be a destination so people that have never been to a winery and distillery before can visit us and see what goes on.” The
advantage of these interactions and make it a point to listen to their customers. Constance shares, “We have two tasting
“Work in a winery or distillery as a cellar rat or assistant at first. You will gain thousands of dollars worth of valuable information without having to spend any money.”
rooms and retail shops so we have the opportunity to see and hear how we are doing on a
— KEITH BODINE,
SWEETGRASS WINERY & DISTILLERY
daily basis. Not only do production processes change but more
or distillery as a cellar rat or assistant at first. You will gain
importantly people’s tastes change, too. People are wanting
thousands of dollars worth of valuable information without having
more unique and local flavors and like having a product that
to spend any money. Collaborate—get to know each other—and
reminds them of Maine.” Sweetgrass continues to be supported
become supporters, not critics, of the other craft distillers in
by their community because they honor rich farming traditions
your state.” Futhermore, Keith stresses, “Make a product you
and support those farms. In addition, they take it a step further
really want to make, that you love, instead of making a product
and donate 10 percent of their profits to organizations and
that market research tells you will do well.”
groups that support families, children, and rural life. The Bodines have proven their ability build a great business and offer this advice to new spirit producers: “Work in a winery
Sweetgrass Winery & Distillery is located in Union, ME. For more info, visit www.sweetgrasswinery.com or call (207) 785-3024.
FROM THE FLOOR UP S E L F - M A LT I N G D I S T I L L E R I E S WRITTEN BY CHRIS LOZIER
ick Wasmund and the crew at Copper Fox Distillery have
Leopold Brothers in Colorado, Corsair Distillery in Tennessee,
floor malted all of their own barley, 1600 pounds every
and Maine Craft Distilling in…drum roll…Maine. While they all have different reasons for malting in-house,
other day, for the past 10 years at their distillery in Sperryville,
Virginia, and they plan to do the same at their soon-to-open
most of them, like Copper Fox, were partly driven by necessity. “Part of the reason we got into malting is because I had the idea
second distillery across the state in Williamsburg. “It costs a little bit more I imagine, but for us there’s no option,” he explains. “Once it gets in your blood it’s hard to go back.” Smoking some of the barley, and kilning some without smoke, Copper Fox is able to make all the malt they need for their whiskeys and gin, joining
of smoking the malt with different stuff,” explains Wasmund, who interned at Bowmore distillery in Scotland where he worked
Distillery, and Coppersea Distilling in
PART OF THE REASON WE GOT INTO MALTING IS BECAUSE I HAD THE IDEA OF SMOKING THE MALT WITH DIFFERENT STUFF.”
New York, Rogue Spirits in Oregon,
RICK WASMUND, COPPER FOX DISTILLERY
a very small group of distillers who floor malt their own grains, including Hillrock Estate Distillery, Orange County
with malt kilned with peat. He wondered how malt would taste if kilned with apple and cherry woods, so he did it himself to find out. “We wanted to experiment with the fruitwood smoked, and there really wasn’t anybody that does the small batch malting that would allow us to do it,” he says.
WE CAN JUST LOCALLY SOURCE GRAINS MORE READILY AND WE CAN GET IMMEDIATELY SOURCED GRAINS RIGHT FROM THE AREA.” LUKE DAVIDSON, MAINE CRAFT DISTILLING Luke Davidson of Maine Craft Distilling
aren’t good enough—they certainly are—
in Portland had the same issue. Davidson
it’s that they are able to do more and gain
is able to floor malt all the Maine-grown
flexibility with those grains when they malt
Newdale barley he needs for his whiskey,
40 tons a year, which is something he could
“It’s the philosophy but it’s also to be
easily buy from a good maltster, except for
able to make products that adhere to what
one thing: he kilns his malt with Maine-
we’re trying to do,” Kinstlick explains.
harvested peat and seaweed. After aging
“We do a green malt product and we are
that whiskey in barrels coopered in town
the only ones doing that. We could not do
with Maine-grown white oak, Davidson’s
that unless we malted our own grain, just
product is a completely terroir whiskey—
because you have a window of about 12 to
something he couldn’t do without malting
his own grain.
Green malt never sees a kiln, but is
“We built an in-house system specifically
instead mashed while it’s still sprouting,
for our malt,” says Davidson, explaining
which Kinstlick describes as “like trying
that his unique whiskey is selling rapidly,
to mash a salad.” It is one-of-a-kind,
so fast that he doesn’t have any malt
extremely rare, and only possible because
to spare to sell to breweries or other
they malt in-house.
distilleries. “We’re really having trouble keeping up with our own needs.”
Malting in-house is also beneficial because it gives the distillers control over the malt they want to use, and immediate
access to it. Kinstlick says that there is only one malt house in New York that will
“One of the reasons we really made
malt rye, and their malted rye is almost
the commitment to do our own malting
always spoken for. He says if he delivers
is because it would allow us to make a
them raw rye from a farmer they will malt
100 percent corn product,” tells Michael
it for him, but at a certain point he and
Kinstlick of Coppersea Distilling in West
Distillery Manager Christopher Williams
Park, New York. “To be able to make a true
thought they should just do it themselves.
100 percent corn whiskey we need corn
Davidson in Maine says that type of
malt, so we’re figuring that out. That was
control is invaluable, saying that beyond
really a motivation for us.”
having control over the malt’s character
Kinstlick says that while they are moving
and flavor, he also appreciates being able
towards malting all their grain in-house,
to control how much malt he has, when he
which will soon include grain they grew
has it, and where it comes from.
themselves at their recently purchased
“We can just locally source grains
farm, they still gladly purchase outside
more readily,” he tells, “and we can get
grains for some of their spirits. It’s not that
immediately sourced grains right from the
the grains they purchase from maltsters
PHOTOS FROM TOP: COPPERSEA DISTILLING PHOTO BY PETER BARRETT. MAINE CRAFT DISTILLING PHOTO BY PETER GUYTON. LEOPOLD BROTHERS PHOTO BY TARYN KAPRONICA. COPPER FOX DISTILLERY PHOTO BY AMANDA JOY CHRISTENSEN.
CENTRAL TO THE BUSINESS Some of the self-malting distilleries, like
in Denver,” tells Kapronica, “so for us this is just another extension of those relationships.”
Copper Fox, have been malting since they
Copper Fox is also selling their extra malt
started, and others, like Leopold Brothers in
to breweries, and while Coppersea doesn’t
Denver, have grown into it.
sell their malt to anyone else, they have
“The floor malting has only come about
given some malt to local breweries, too,
within the past year,” tells Taryn Kapronica
creating extra exposure for the distillery, and
of Leopold Brothers, who explains that they
strengthening their relationships with their
started as many small craft distilleries do, in
a smaller industrial garage without room to floor malt. Now, 16 years later, they are in a new facility they custom built to fit their needs, and the first thing visitors see when
explaining that it is a key component of
IT’S ALWAYS BEEN VERY IMPORTANT TO US TO CONVEY TO CONSUMERS AND BUYERS ALIKE THAT WHAT WE’RE DOING IS AN AGRICULTURAL PURSUIT. IT’S REAL FOOD WE’RE WORKING WITH HERE.”
their business. “It’s always been very
TARYN KAPRONICA, LEOPOLD BROTHERS
they enter is the malting floor. “That has been a longtime pursuit of Todd Leopold’s, to eventually do floor malting, so that was definitely a big element which we built the distillery around,” she said,
important to us to convey to consumers and buyers alike that what we’re doing is
In-house malting isn’t for everyone. It takes
an agricultural pursuit. It’s real food we’re
extra space, extra labor, extra equipment, a
working with here.”
controlled environment and a regimented
Now, with the malting floor they have
schedule, and if you do the math, it probably
always wanted, they use house-malted
costs quite a bit more than purchasing form a
barley for 21 of their 22 current products,
maltster. For these eight distilleries, though,
and they even have extra malt to sell to local
the extra costs are worth it, as their malting
programs have now become an irreplaceable
“We have a lot of wonderful collaborations
component of their business.
already with so many breweries—everyone
“It’s not even a thought that we would buy
from the bigger entities like New Belgium,
malt,” tells Wasmund of Copper Fox. “We’ve
to the small three-man team operations here
always malted and that’s just what we do.”
PUT OUR CUSTOM INTO YOUR CRAFT. custom-metalcraft.com 417-862-0707
D I S T I L L E D S P I R I T S A N D K E Y F L AV O R S :
SMELLING ROSES, FRUIT, STINKY FEET AND MUCH MORE IN MY GLASS WRITTEN BY GARY SPEDDING, PH.D. & JOHNNY JEFFERY, M.S.
he understanding of the flavor of distilled spirits forms an
(CH3CH2OH) itself is a solvent and confers tactile sensations of
incredibly complex topic—one which is only now really
warmth or heat and mouthfeel (viscosity), but it also extracts and
becoming understood at the molecular level. The origins and
interacts with many other components to “enhance” the flavor
controls of the generation of over 1000 components bear upon
profile. Ethanol has a sensory perception threshold of around
the overall flavor profile of each characteristic style of the classic
1.4 grams per 100 mL of solution. It has been discovered that
spirits. This forms the basis for “the art of the distiller” and
non-volatile components extracted from oak casks during spirit
relies upon the use of their senses to control and create the
aging can influence the structure of ethanol-water complexes
in distilled spirits. This then affects the flavor activity of other
Though thousands of components are present in these
more volatile flavor compounds in the product. While we cannot
complex beverages, a key set of components form the base, or
delve too deeply into all these subtleties, the rest of this article
foundation, from which the overall structure of each spirit is
will illustrate the origin of mostly volatile and a few non-volatile
built. In the past and for all time the human senses have been
components which come together to give rise to the sensory
used to determine if the product is as intended and maintains
pleasures (or displeasure if something is wrong) of consuming
a suitably long shelf-life. The distiller must therefore, from a
such beverages. However, flavor pleasure is a personal thing, so
sensory perspective, understand at least several dozen flavor
the point here is to teach or train the distiller or consumer to
components and be able to control their formation, be cognizant
understand a few key flavor notes only. Compared to water and
of maturation factors, or manipulate conditions to provide the
alcohol they form collectively only a small fraction of the whole,
consumer with a quality product of consistent flavor and stability.
but contribute massively to the overall pleasurable soul of the
A brief review is presented below on just a few key players in
the flavor profile of the most complex types of spirits—the so-
Building a vocabulary of terms is the first step in understanding
called brown spirits in particular. Gin, as a classic white spirit,
this flavor chemistry. Some flavor notes are above sensory
and unaged spirits—white whiskey, tequila and rum—must also
detection threshold concentrations, many more are below any
be understood in terms of flavor production (including flavor
detectable levels from a sensory perspective. Yet the interplay
from added botanicals, for instance) and some issues discussed
of several hundred to thousands of components is essential
below pertain to these unaged spirits, at least up to the point of
to creating the quintessential distilled spirit. No one will ever
discussion of barrel aging.
establish a simple base set of components that, when mixed at
WE BEGIN WITH WATER. Then we add alcohol. Distilled spirits
appropriate concentrations and in the correct proportions, will
contain the highest concentrations of alcohol of all alcoholic beverages, yet water (H2O) is still, for most spirits, the dominant chemical component. Water quality is important for producing spirits (and must be especially pure for dilution). Flavor issues originating or emanating from water supplies is not covered in depth here, however, some physical attributes of solutions dictate the overall flavor profile and deserve a brief mention. In typical spirits 40% alcohol by volume is the norm and thus ethanol is the next most abundant component present. Ethanol
give the desirable and acceptable flavor profile of an authentic spirit. While science makes advances in understanding flavor, it will still be both an artistic (a personal sensory experience) and a scientific endeavor to produce a consistent, desirable and quality commodity. A basic understanding of key flavor notes, however, will assist the distiller as part of a quality assurance and control program as will be seen below. A product can be technically perfect from an instrumental testing viewpoint – all components quantified to the nth degree—yet may be absolutely
off the mark from an acceptable taste and aroma viewpoint.
FIGURE 1: YEAST
KEY SPIRIT FLAVORS CHEMICAL CLASSES & EXAMPLES
ON THE ORIGINS OF FLAVORS. For the chemist
within the matrix of a well-crafted distilled spirit
(many noted in Figure 1 with other classes presented
in Figure 2), though control of the amounts of each Flavors derive from:
Ala, Val, Leu, Ileu, Phe, Tyr
also a role in alcoholic beverages and favor
»»Water »»Raw Materials: Grains, Sugars, Molasses,
ETHANOL FATTY ACID-CoA
Grapes (Brandies etc.), Fruits and Botanicals
FATTY ACIDS Acetic, Butyric, Hexanoic, Octanoic
HIGHER ALCOHOLS CH3
Key raw materials provide the sugars required for
HIGHER ALCOHOLS ESTERS
»»Mashing and Fermentation (See Figure 1) »»Distillation »»Aging or Maturation (See Figure 2)
Complex pathway via, intermediates of amino acid metabolism
we note that all classes of compounds are present
through the various processing steps is important.
1-Propanol, 1-Butanol, 2-methyl-1-propanol, 2-Butanol, 2-Methyl-1-butanol* H3C 3-Methyl-1-butanol* & Phenethyl alcohol. *[Active and iso-amyl alcohols - the main “fusel oils”]
alcohol production by fermentation which, as will be seen, is
Ethyl acetate, Et. butanoate, 2-Phenethyl acetate, Et. hexanoate, Iso-amyl acetate, Et. octanoate Et. decanoate, Et. dodecanoate, Et. lactate
desirable and sometimes undesirable flavors which carry through
then important for producing many flavor volatiles (congeners).
to the final product. Fermentation gives rise to the majority of
Malted barley, rye and wheat also provide other components that
volatile components which, depending in part on their physical
can impact the final product. Peated malt gives rise to burnt or
and chemical properties, will either be selected out, retained
smoky flavors from several phenolic compounds. Mashing (the
or modified during the art of distillation. Fermentation flavors
conversion of starches to fermentable sugars) and fermentation
are illustrated in Figure 1 with several of those flavor notes
must be done under defined conditions using suitable yeast strains
described further in Table 1. In distillation many reactions take
(and may include bacteria in Bourbon and Rum production).
place to reduce bad sulfur notes, for example, but they also yield
Bacteria, wild yeast and even culture yeast give rise to many
other favorable or unfavorable components—the importance of copper here cannot be underscored (Table 1 presents some
FIGURE 2: BARREL CHEMISTRY
information on the sulfur compounds). Then maturation forms Toasty Notes! Hydroxymethyl furfural
CELLULOSE — Holds the wood together. No direct influence on maturation.
OAK TANNINS — Leads to astringency and assists removal of off-notes (e.g., rubbery flavors).
for multiple reaction chemistries to take place to smooth or
Furfural and Maltol
butterscotch, caramel, almond characteristics
mellow out the flavor profile. Figure 2 hints at several areas of flavor production from the very complex and huge topic of oak aging and maturation.
HEMI-CELLULOSE — Leads to wood sugars (body), caramelization reaction products and to color. LIGNIN — Leads to an increase in blended complexity, to vanilla production, assists in promoting oxidation reaction products and adds color.
the final step whereby time and physical conditions allow
Complex phenolic aldehydes leading to vanillin and vanillic acid.
A brief description of several key flavor components
presented in Table 1. By necessity only a few components are
Astringency and bitterness & promotes oxidation reactions to create “delicate fragrance.” Hydrogen peroxide is formed which can oxidize ethanol to acetaldehyde and a delicate like fragrant “top note” —diethyl acetal.
CHAR LAYER — Assists removal of rubbery off-notes and lends burnt wood flavors.
Phenolics: phenol, guaiacol, o-cresol, p-cresol, ethyl guaiacol eugenol — Cloves, smoke, spicy, coal-tar notes.
LIPIDS, OILS AND WAXES — Change during seasoning and toasting.
Toasty/coconut notes. Cis-oak and trans-oak lactones. O
including their flavor descriptors, origins and control are listed and we recommend the interested reader contact the authors or consult a voluminous literature to uncover more fascinating secrets to the flavor profile of their preferred tipple. Both the authors would be willing to share more on this topic. The main take-home message is that key aroma compounds arise at each stage of the operation in spirits production (with fermentation and maturation providing the majority of components and the most fascinating chemistry involved in their synthesis).
FLAVORS ASSOCIATED WITH THE PRODUCTION OF DISTILLED SPIRITS
THE GOOD, THE BAD AND SOMETIMES THE UGLY FLAVOR NOTE
Green apples, bruised apples, grassy, latex paint, Florists shop (green stems, cut grass), melon, pumpkin, ethereal.
FLAVOR THRESHOLDS* COMMENTS AND NOTES 10-25 ppm.
[Range in spirits 8-240 ppm. Whiskies (incl. Bourbon): 16-100, Brandies: 52-240, Rum: 8-60 ppm.]
Originates from poor/stressed fermentations and from oxidation aging reactions in the wood. May also arise from bacterial contamination (incl. Acetobacter). Oxidative formation of acetaldehyde from ethanol or from reduction of acetic acid may occur during maturation. However, most aldehydes are formed during fermentation.
Acetic acid is the major component of the total acids in matured spirits. It may be produced from ethanol via acetaldehyde during maturation. It can also be a bacterial contamination issue.
CH3COOH [Ethanoic acid, Acetate in the anion form]
Vinegar-like, pungent, sour, acidic
Piercing, disagreeable odor, peppery, hot/acrid, horseradish. Lachrymator (irritant causes tearing). Known by the term “pepper” by grain alcohol distillers.
Threshold in water – 0.04 ppm. [10 ppm In low proof distillates?]
Butter, butterscotch, movie popcorn. As an oily compound it may be present as an oily “slickness” on the palate.
Odor threshold cited at From fermentation and bacterial spoilage. Yeast strain 0.02-0.04 ppm (or 20-40 dependent. Produced by wild yeast and Lactobacillus and ppb) in imitation whiskey. Taste at 0.2 ppm (200 ppb). Pediococcus bacteria. Controlled by proper care of yeast (nutrient levels) and fermentation conditions. It can be Very low amounts in vodka, controlled at the end of fermentation – this complex topic low ppm. Values in Scotch is not discussed here. The precursors of diacetyl can be whiskies, 70-300 ppb in converted rapidly to diacetyl during the early stages of Brandies, 30-4400 ppb in distillation when heat is applied. With similar volatility to Rum (high in the “Buttery ethanol it is not easily removed once formed. Rums”).
CH2CCHO [Acraldehyde, Acrylic aldehyde]
2,3 Butanedione [Diacetyl] CH3COCOCH3
CH3CH2CH2COOH [Butanoic acid, Butyrate as the anion form]
Acetic acid also has a key role in fatty acid metabolism and in ester formation (See Esters).
Rancid, sharp cheese, baby vomit/sickly sour, pungent/ putrid, sour spent grains.
(ortho and para: o-cresol aka. 2-methylphenol, p-cresol aka 4-methylphenol) CH3C6H4OH
Pungent, creosote, coal tar [o-cresol – medicinal, tar] [p-cresol – medicinal, smoky]
Aroma threshold in beer (possibly also in whisky?) at 3 ppm. High levels (10-14 ppm) may be present in Rum and Brandy.
Thresholds in water: o-cresol 40 ppb, m-cresol 200 ppb. Detected in the ppb range in spirits also. Amounts said to vary from 2 ppm to 54 ppm in Highland and Islay (peated) whiskies.
A low boiling point compound – readily detectable as a pungency in spirits. Often noted in poorer quality GNS (grain neutral spirit). Some lactobacilli convert glycerol excreted by yeast into 3 or β-hydroxypropionaldehyde (peppery note) which is then converted to acrolein by the heat of distillation. Some acrolein is always produced from glycerol in pot still distillation. Acrolein has been reported to disappear over twothree years of aging to yield a less flavorful compound.
From bacterial contamination in many cases except in certain rum fermentations. Produced if appropriate strains of bacteria are present during low temperature mashing. Once formed it is not easy to remove. Notably positive in some rum fermentations (heavy rums). Butyric acid bacteria (various species) can convert carbohydrates to yield acetic acid and butyric acid. While often unpleasant as the acid it can combine with ethanol to form the ester ethyl butyrate with pleasing fruity notes. Other acids form other complex esters with butyrate. Phenolic compounds which contribute significantly to the smoky peaty flavor of certain whiskies. Peating (smoking), killing of malt (thermal degradation reactions) and maturation (aging in oak barrels) are the main sources of phenolic compounds in whiskies. See Figure 2.
* Thresholds mostly known for Scottish Whisky—assumed source unless otherwise noted. ~ ppm. Parts per million—also expressed as mg/L. ppb—parts per
billion (micrograms/L). A few dozen other compounds could have been added to this list of the core or better known flavor contributors to various types of distilled spirits. Metabolic reactions (biology) during fermentation, chemistry in the heat of distillation and surface chemistry in the case of barrel aging provide the majority of flavor active substances in distilled spirits. The Scottish Whisky Flavor wheel and research by the Scottish Whisky Research Institute into whisky flavors would be worth a search to add depth to our brief coverage here. Recently other spirit flavor wheels (Rum, Gin, and Brandy, for example) have been developed and will assist the reader in expanding their flavor terminology knowledge. A series of proceedings volumes from the Barrel Symposium series sponsored by the Independent Stave Company will add depth to the maturation issues and flavor production involved in spirit aging.
Dimethyl disulfide [DMDS] CH3SSCH3
Dimethyl trisulfide [DMTS] CH3SSSCH3
Sweetcorn/creamed corn, parsnip, tomato juice, quince, truffle, asparagus, oysters and the ocean spray (depending upon concentration and context).
Rubber, asparagus, garlic-like, rotten vegetable.
Stagnant, rubbery, meaty, onion.
FLAVOR THRESHOLDS* COMMENTS AND NOTES
Threshold 35 ppb. May be quite high at the initial barrel fill dropping to low ppm values at three years and to traces at six years of maturation.
Detectable at 1 part per trillion (ppt)!
Regulation of dimethyl disulfide and dimethyl trisulfide content in new make spirit is very important. Many other sulfur compounds are involved in overall flavor issues with spirits and wine. Careful distillation operations along with the presence of copper can modulate the final DMTS concentration. Exposure to active copper retains the compound allowing it to be removed from the vapor. DMTS has been shown to decrease gradually during maturation; its rate of decrease though is much slower than for DMDS.
The most common ester. Total esters high in Am. Whiskies (970 ppm), Irish whiskies (808 ppm), French Brandy (630-980 ppm), Heavy rums (1584-2700 ppm) Jamaican rums (1732 ppm).
Estery, apple (red or fresh/ripe) with a hint of aniseed.
Ethyl Hexanoate is also described as conferring flowery/fruity aromas such as pineapple, blackberry, applepeel and strawberry aromas.
Flavor threshold (in whiskey research) 0.17-0.21 ppm.
High fermentation temperatures and high gravity brewing leads to higher ester concentrations. With a similar boiling point to ethanol it is difficult to remove from the heads (foreshots) fraction during distillation. Ethyl acetate can arise from wood-derived acetic acid or from the oxidation of ethanol. Cited to rise from an initial level of 60 ppm to 160 to 525 ppm at 3 and 6 years maturation – whisky. Strong accents in many spirits. Another volatile ethyl ester found in alcoholic beverages. Formed from caproic or hexanoic acid (itself fatty, sweaty or cheesy) a medium chain fatty acid. This shows an interesting aspect of flavor chemistry – rancid, cheesy, putrid, sweaty notes can change into sweet fruity notes upon esterification with alcohols. Formed during yeast fermentation and also from the metabolic activities of specific microorganisms. Longer chain fatty acids and their esters form many of the characteristic notes in feints.
Fruity, banana (overripe), peardrops, circus peanuts (candy) [Banana oil, pear essence.]
Low ppm. Threshold values.
Alcohols other than ethanol can form esters in conjunction with activated acetic acid (in a form known as Acetyl-CoA). Only a few smaller-sized esters are considered here, though see also phenyl acetate. Many esters produced by alcohol linkage to short and medium chain fatty acids are also present in spirits. Esters can be fruity to rancid to cheesy in character depending upon the nature of the associated alcohol or acid present.
Roses, floral, sweet honey-like.
Threshold reported in beer at 3.8 ppm. Similar in spirits?
An ester with an aromatic ring structure. Derived from acetate and phenethyl alcohol (see under fusel alcohols and phenethyl alcohol).
Phenethyl acetate [2-phenylethyl acetate] CH3COOCH2CH2C6H5 [C10H12O2]
Esters are formed by a combination of activated acids and alcohols. Ethanol being the most common alcohol leads to ethyl acetate being the most prevalent ester.
The concentrations of ethyl esters decrease over time as an alcoholic beverage ages due to spontaneous hydrolysis (breakdown back into the corresponding acids and alcohols). Aging after bottling is thus also a complex process.
Oxidation of DMS to DMSO in maturation reduces it to low levels and char/charcoal (via adsorption, concentration and oxidation reactions) can play a role in reducing levels. Tannins and copper ions in the cask can also be important in degradation and removal of sulfurs in general. Regulation of dimethyl disulfide and dimethyl trisulfide content in new make spirit is very important. Other intermediate sulfur compounds are involved in its formation. Careful distillation operations along with the presence of copper can modulate the final DMDS concentration. (See DMTS below.) The distiller should learn about this key sulfur removal process and the use of copper and its rejuvenation after it has become “exhausted”. DMDS has been shown to decrease gradually during maturation.
Flavor threshold at 20-30 ppm. Acetone (nail varnish remover), estery, paint thinner, solventlike and with fruity nuances.
An issue with barley malt-based spirits as sulfur containing barley amino acids form precursors to several low molecular weight but pungently aromatic sulfur compounds. DMS is formed in mashing from malt DMS precursor. DMS itself can be oxidized to DMSO (dimethyl sulfoxide). Lost in evaporation but only at elevated temperatures.
Spicy-clove, allspice, 4-(H2C=CHCH2)C6H3-2- cinnamon, ginger, aromatic and nutmeg (not to be confused (OCH3)OH with similar notes from [C10H12O2] guaiacols which are in fact more smoky spicy-like). [4-allyl-2-methoxyphenol]
FLAVOR THRESHOLDS* COMMENTS AND NOTES Taste threshold 50 ppb in 20% ethanol and a recognition threshold of 4.9 ppm in 23% grain spirit. Notable in Bourbon and Canadian whiskey with low ppb recognition. Grain whisky at odor threshold at four years.
Major volatile phenol derived from oak. Like most phenolics extracted from wood, arises by alcoholysis of lignin (“splitting of lignin by alcohol”). Increased by thermal degradation of oak. Arises from new staves after charring and ethanolic extraction or from cereal cell walls. Eugenol or clove buds easy to obtain and use as training guides to illustrate the aromatics of a general class of phenolic flavor compounds.
(2-Furaldehyde – C5H4O2) and 5-hydroxymethyl furfural (HMF, 5-hydroxymethyl-2furaldehyde – C6H6O3)
FUSEL OILS (ALCOHOLS)
(several compounds – Main players): 2-Methyl-1-Butanol (Active amyl alcohol) CH3CH2C(CH3)2OH 3-Methyl-1-Butanol (Isoamyl alcohol) (CH3)2CHCH2CH2OH
Sweet, butterscotch, caramel, smoky, almond nuances.
Alcoholic, spicy, vinous, pungent and warming. Poorly rectified spirit aroma with the rubbing alcohol-like solventy notes. Several alcohols are involved and these being higher boiling point volatiles than ethanol are considered “tails” compounds.
The main fusels – active and Isoamyl present at 410-475 ppm in Scotch, 150-230 in Canadian, 1685 in Bourbon and 422-990 ppm in French Brandy.
Rose-honey-like, floral, sweet
Typical values given as 5-32 ppm in whiskeys and 130 ppm in straight Bourbon.
[2-methoxyphenol] (CH3O)C6H4OH C 7H 8O 2
Hydrogen sulfide H2S [Sulfidic]
Cis and trans isomers β-methyl-γ-octalactone C9H11O2
Formed in fermentation in metabolic reactions involving amino acids. The amino acid leucine leads to isoamyl alcohol and iso-leucine leads to active amyl alcohol. Any condition that stimulates yeast growth will stimulate fusel oil production.
While this is a so-called mixed aliphatic (long chain)/aromatic (contains a ring structure) alcohol with different properties to those fusel oil components listed above, it is actually a fusel alcohol. Derived from the amino acid phenylalanine it is produced during fermentation – so its formation is yeast and fermentation condition dependent. It adds a positive note to spirit flavor/aroma.
Threshold in water 5 ppb!
Rotten egg, hard-boiled eggs, hair permanent solution.
0.005 ppm (0.5 ppb – parts per billion!]
Produced by yeast during fermentation – so yeast strain dependent production. Can also be produced by contaminating bacteria.
Vanilla, ice-cream, vanilla bean.
Threshold 0.1 ppm in water. Notable as a key component in Bourbon and perhaps a big part of the “Angels share” aromatics in the Bourbon warehouse?
Vanillin is the main aroma component of natural vanilla. Significant amounts in oak wood. Increased up to a point by toasting – decreased at high toast level. See Figure 2.
Recognition threshold at 1 ppm in 23% grain spirit whisky. Lactones are important aroma compounds and present in notable amount in Jamaican Rum.
Important oak derived flavors – from oak lipid oxidation. Seasoning barrels affects the ratio of the cis and trans isomers. Toasting may reduce overall levels. American oak shows higher lactone amounts than for other (French) oak species. Notable in matured spirits in new charred casks and at higher concentrations in higher alcohol strength spirit maturations.
Whisky (or Oak) Lactone
The fusel oils are a complex mixture (maybe 40-50 distinct components) of aliphatic alcohols – longer chain alcohols than ethanol with correspondingly higher boiling points as length increases. Includes: 1-propanol, 2-methyl propanol (75 ppm threshold) including the major components 2-methyl butanol and 3-methyl butanol – the amyl alcohols. A typical fusel oil contains 60-70% of the amyl alcohols.
Guaiacol and related compounds in general contribute char-like, smoky and spicy aromas
[4-hydroxy-3methoxybenzaldehyde, vanillic aldehyde]
Produced by heat-induced degradation of sugars and carbohydrates – caramelization reactions. Generated during toasting. See Figure 2.
Have arguably been associated with hangovers. Unpleasant in most situations at very high concentration.
Phenethyl alcohol [2-phenylethanol]
Furfural – threshold in water 8 ppm.
Coconut. cis – also with earthy herbaceous notes. trans – coconut and spice character. [“Oaky – oakwood aroma”)
Formed by degradation of the lignin component of wood during toasting and charring (pyrolysis reactions). Higher toast levels = more guaiacols. [See also Eugenol and Figure 2]
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Through flavor evaluation the distiller will learn an essential quality control tool—their senses—helping them achieve consistency with each batch made via evaluation of each ingredient and at each step along the way. Presented here is, however, just the “tip of the iceberg”, or the “top few millimeters depth of the barrel” coverage of this vast topic. Hopefully we will “wet your appetite” or awaken your senses to want to learn much more. Read on.
Gary Spedding, Ph.D. is a brewing analytical chemist/sensory specialist Johnny Jeffery, M.S. is head distiller at Santa Fe Spirits and consultant and managing owner of Brewing and Distilling Analytical Services, to the industry. Johnny can be reached at John@ArtisanDistiller.com. LLC. For more info visit www.alcbevtesting.com or call (859) 278-2533.
Meet the Tin Man TINBENDER CRAFT DISTILLERY WRITTEN BY CHRIS LOZIER PHOTOS BY AMANDA JOY CHRISTENSEN
aul Ziegman is a talented guy. The father of two and black belt in Okinawan Goju Ryu
founded Tinbender Distillery with his wife Tosha in 2014. Well-spoken, intelligent, and friendly, he offers tours and samples in his airy brick and mortar space in downtown Spokane, Washington. Visitors touring the distillery are intrigued by many things, but Ziegman surprises everyone when he tells them his secret: “Everything you see in here I built myself.” From the I-beam steel framed glass wall and copper countertop that he salvaged from scrap, to the fermenters, tanks and pot stills, Ziegman is a creative designer, builder and repurposer, traits he’s been developing for 18 years at his day job. Ziegman works full-time as a stainless steel sheet metal fabricator, building custom kitchens and cooking equipment for restaurants, many of which sell cocktails featuring his spirits, too. “Somebody comes to us with a project—they want it like this—and we make it happen,” tells Ziegman. “You’re always adapting, you’re always trying to figure out how to do it, which lent well to the distillery.” Sheet metal workers call each other many endearing names, most of them not fit for print, but one of those nicknames, tinbender, became an apt brand for his distillery. All of Ziegman’s equipment is stainless steel, except for the copper cooling sections of his stripping and spirits stills. When building his equipment, he designed each piece to work together, using a one-to-one ratio. “I started with the ferment tanks which are 100 gallons,” he explains. “One mash fits in the stripping still and one strip run of low wines fits perfectly in the spirits still.”
The lyne arm on the spirits still has sealed port vents, which draw air to precool the distillate on its way to the copper condenser, but don’t let any of the vapors escape. Ziegman designed the spirits still to be squat, so that once the vapors leave the pot they immediately head for the condenser. “As soon as it turns that corner I want flavor coming out,” tells Ziegman, who says he likes the full-flavored, high-congener spirits that pot stills produce. When he first looked at designing equipment, Ziegman was attracted to the efficiency of column stills. He was, however, a fan of pot still flavor, and once he chose to build pot stills, he says he realized that he really wanted the connection to traditional distillation that they offer. “Pot still spirits are more complex in a simple way,” he offers. “I like the simplicity of a pot still. I like the old world style of doing stuff. You watch those temperatures do different things and you learn from that.” Ziegman says that same old world philosophy guides all of his techniques. Using open-top fermenters which he hand–paddles, he says he is able to learn more about the process, which helps him grow as a distiller. One day, he says, he may build an automated mash mixer, but for now, he’s enjoying doing it the old fashioned way. Other people are celebrating his traditional distillation techniques, as well. On the weekends, friends and visitors come down to help with the mash-in, which helps to build a community of distillation fans who feel more connected to what’s in the bottle. “We all get together, we’re all mixing, we grind the grain, mix it in, we all mash, we talk about our mash temperatures,” says Ziegman. “It’s like community—it just makes it more fun, and people get to learn more about distilling without paying to take a class.” His traditional approach affects his marketing, too. While he’s laying some brandy and whiskey down to age, Ziegman says he’s proud to promote his unaged brandies and whiskey because it is how spirits were enjoyed in early America. “Turns out George Washington took his whiskey
white—didn’t age it at all,” tells Ziegman, “so this is about as
LULA-WESTFIELD F A M I L Y O W N E D & O P E R A T E D S I N C E T H E 1 8 7 0 ’s
close as you can get to pot still whiskey made in that era.” White spirits, however, can be tricky, especially high-congener spirits like whiskey and brandy. Long, complex molecular chains that would normally get broken down and positively developed by a charred oak barrel are laid bare for the palate, often boasting
Raw cane sugar in half ton or one ton totes Black strap molasses in 250 gallon totes
barnyard flavors that can be overpowering. Ziegman says making tight heads and tails cuts are key to producing desirable white whiskeys and brandies. “You’ve got to be willing to throw stuff away,” he tells. “I try to keep just the right amount of heads and tails to keep the flavor
Our non-GMO raw sugar, NATURE’S TURBINADO , has zero additives. Its natural light golden color is the result of molasses from the sugar cane. Grown and produced in Cajun country of south Louisiana Supplier to many distilleries in the U.S. and American Rum Association member
profile together, but the rest of it goes to cleaning.”
A Community of Friends and Family Ziegman cooperates with a lot of local businesses in Spokane. He sources wheat from a fellow tinbender’s farm 30 miles away, wine for his brandy from a winery a couple blocks away, coffee from Anvil Coffee Roasting, a roaster down the street, and his apple brandy is made from cider from nearby Liberty Cider Works.
For a quote contact: email@example.com or firstname.lastname@example.org
He’s also working on collaborations with two local breweries, making fortifying spirits for Overbluff Cellars, a local winery who wants to make port, and Liberty Cider Works plans to use his spirits as fortification for their Pommeau.
Tinbender sponsors local events, awarding free bottles to the burly winners at the Spokane Highland Games, and Ziegman features a different local artist each month for Spokane’s First Friday, a once-monthly celebration of local visual and performing arts. One of his featured artists, Jesse Pierpoint, even designed Tinbender’s brand and labels, and his Ruckus White Whiskey label won an ADDY award from the American Advertising Federation. Working with local businesses and supporting local events is Ziegman’s form of advertising for now, and he’s talking with a distributor so he can focus his Fridays, Saturdays and Sundays at the distillery on operations and distilling, rather than selfdistributing. Time is short enough as it is. Working full time and running a distillery take a lot of time and energy, but Paul and Tosha try to keep a balance. He’s currently working on a black belt in Judo with his kids, and they regularly travel to Judo tournaments together. He also credits Tosha for doing the gritty behind-the-scenes work to keep the business running. “My wife has been very supportive and she runs all the taxes,” tells Paul. “I’ve been very lucky.”
LULA SUGAR FACTORY (EARLY 1900’S)
Tinbender Craft Distillery is located in Spokane, WA. For more info, visit www.tinbendercraftdistillery.com or call (509) 315-7939.
BREAKING UP WITH YOUR DISTRIBUTOR WRITTEN BY CHRIS LOZIER
hile nearly all of your relationships with distributors will
This is the way traditional distribution relationships should
be beneficial, as partnerships should be, you should
work. In this type of partnership, everyone is more successful.
know some of the warning signs of a failing agreement, and
But sometimes things go wrong.
what to do to protect yourself if that partnership sours.
“The relationships are usually strained when there are
“Ninety-nine percent of the time, your distributors are your
misconceptions about what is actually going on in-market,” the
tickets to successful business,” explained one successful
distiller explained. “When we are told one thing is happening, but
craft distiller, who wished to remain anonymous. “All of our
the numbers are not adding up, that’s when trouble’s coming.”
relationships start well, which is why we choose to go into
In this case, the numbers were only part of the problem. They
business with the companies to begin with. It seems like a lot
said the distributor also had some strange business practices
of promises are made and it’s really up to us, as the owners of
that they could not explain or justify, and when the distiller
the brand, working in markets, to keep the distributors focused,
spoke with establishments that purchased from the distributor,
interested in helping our sales, and supporting them with
they gave concerning feedback, as well.
whatever they need to support the brand.”
The distiller tried to work with the distributor to rectify the
Promoting your brand, as long as you are not stepping on
situation, but soon both parties agreed to call it quits. While
your distributor’s toes, helps both parties. The distiller said they
it left the brand without distribution in that territory for a few
hosted events and worked directly with their sales teams, which
months, they said it was better for the long-term success of the
most distributors appreciate.
and brand rights from them, as well, costing you even more.
“We tend to give a lot of leeway,” said the distiller of their
That’s why many professionals recommend having a solid
distribution relationships. “We have tightened up a bit, but
written contract. The contract is a set of performance guidelines
especially in the beginning, when we were just with a few states,
for both parties, outlining standards and expectations which are
you really want to believe the distributor when they say they are
measurable. Without these standards, you will not be able to
doing all they can and using our resources in a helpful way.”
give good cause if you want to leave a distributor.
While good distribution partnerships are beneficial for both
Laura Lodge, author of Distribution Insight for the Craft
parties, the distributor typically has many more rights than
Brewer and consultant for the craft beverage industry, and
the supplier. If the relationship sours, your only leverage as
Candace L. Moon, “The Craft Beer Attorney,” presented a class
a supplier will be your contract. While some distillers do not
on distribution contracts at the Craft Beverage Expo this spring
employ written contracts, many distillers and beverage lawyers
in Oakland, California, offering advice on how to construct a
recommend doing so.
Fortunately for this distiller, since both they and the distributor
“There’s no ‘Of course,’” tells Moon. “You want to spell
agreed to sever the relationship, they were free to find another
everything out. You’ve got to have that set before you sign,
distributor and move forward. In many cases, however, it is not
because then you will be able to measure, you will be able to
show good cause, and that literally, in a lot of places, is your only
In many states, distributors can drop suppliers at will, but the
way out of this contract.”
supplier cannot leave the distributor without good cause and
An important thing to remember when courting a distributor
time to cure any problems. Even if you can show good cause and
is that they are making money by selling your products, so do
they do not cure, this process often takes six months or longer,
not undervalue your brand. Make sure that the contract works
eating up your time, resources, and representation in that
for both of you, and negotiate favorable terms before making any
territory. After that, you might have to buy back your trademark
“The distributor has the privilege of carrying your products—
“ When a relationship becomes foggy is when things go
that’s not a right,” says Lodge, who explained that distributors
sideways. The truth comes out in this business and we
should be willing to negotiate with you. “The contract that you
all have to work together— we all have connections
get from the distributor is just a place to begin.” Agreeing with Lodge, Moon said that you should also ask the distributor to clarify language that you don’t understand. If they are unwilling to work with you or explain themselves, you should be cautious, because the only time that you will have any leverage is before you sign the contract. “If you get a contract and you want to make some changes and they say, ‘No, that’s our contract, take it or leave it,’ I don’t think that’s a partnership,” tells Moon. “I don’t think it’s a situation you want to be in.” Among the many facets of a good contract, Lodge and Moon recommend including sales volumes, new account acquisition goals, who is responsible for promoting and growing the brand, and what reports and data will be provided to the supplier. That is one of the problems the aforementioned distiller experienced with their distributor, who was reluctant to release accounts lists and connections. The distiller said you should make sure your distributor provides you with this information, especially if they are not living up to the original agreement.
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to a lot of the same people.”
“On a monthly basis, you need to receive sales reports and accounts lists, no matter what,” they insist. A contract requiring information reporting, performance standards, etc., ensures that the distributor will either provide you with this information and performance, or provide cause for you to find another distributor that will. It also builds the distributor’s trust in you, because you will be held to the set standards, as well. There is no gray area. “When a relationship becomes foggy is when things go sideways,” said the distiller. “The truth comes out in this business and we all have to work together—we all have connections to a lot of the same people.”
Candace L. Moon is founder of The Craft Beer Attorney. For more info, visit www.craftbeerattorney.com or call (866) 290-5553. Laura Lodge is author of Distribution Insight for the Craft Brewer. Visit www.distributioninsight.com for more info.
Best Customer Service In The Craft Industry Now offering all copper stills 250 gallon and smaller
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T S I D
R E ILL
E U IQ
E T T
W E N
EI N S
ld: be... r o w the t to n n i a s r w tille ose who s i d IF YOU’RE ONE OF THE FORMER, f h o t s e d p n you have been one of the latter at some point, and are o ty iness, a w t e s r likely intimately familiar with the back and forth between hopeful bu ea Ther those in and established distillers. While the distilling industry is known for their fellowship, everyone’s patience has its own limits and being respectful will keep everyone’s friendliness from eroding. At Catoctin Creek Distilling Company, owner Scott Harris says they have at least one ‘wannabe’ distiller ask them questions about their business per day. With so many seeking advice, we thought it was time to explore the etiquette involved in making the best out of everyone’s good intention. Every distiller will have a different standard for what is
out of maliciousness, I think they do it out of cluelessness,” he
acceptable or appropriate, but Harris shared with us a general
told us. Besides being polite, seeking information from distillers
set of guidelines that should help in dealing with most distillers.
far and wide will help a new distillery bring varied styles and
He started by explaining how important it is to be considerate
methods to an area. Asking for advice from a distiller who will
of the time of those who you are seeking information from. “For
be down the street will probably not help a new distillery stand
starters…don’t just show up” he told us. Some days, like when
out or gain attention.
end of quarter taxes are due or end of month inventory is being
Harris warned that there is a limit to the amount of friendly
counted, it will be very difficult for any employee to break away
information a distiller should be willing to provide. At a certain
and answer questions. Harris said “If you hit a distiller on a busy
point the distiller offering help could expect some sort of a
day like that, they’re going to be grouchy.” That tip was followed
consultancy relationship. There eventually needs to be a tangible
by a related one: “Second,” he said, “don’t call an hour before
benefit for the established distiller to continue spending their
you’re coming and say you’re coming. That is like just showing
time passing along information. Harris described situations
up.” Ideally, giving several days’ notice will provide the distiller
where one conversation turns into a couple of questions a day
time to make sure they can give you the focus that will make
for two weeks in a row, which definitely pushes the limits of
their help more valuable.
what’s considered friendly advice. Once a threshold is reached,
On top of respecting the time of any distiller who might help
which can be defined by either party, a more formal arrangement
a prospective startup, cultivating a friendship will encourage
may be necessary, especially when the questions reach a certain
the process of sharing information. Instead of showing up out
level of technicality.
of the blue with a list of technical questions, call ahead and get
When speaking on this issue, Harris volunteered a couple of
to know the distiller you want to visit. Harris described several
examples of what definitely NOT to do no matter what. He once
acts that can help endear yourself if you have a desire to build
had an individual take a bottling class, leave the designated
a relationship. One of the simplest ways is to buy a bottle from
bottling area, and then proceed to take pictures of serial numbers
them. If they are spending their valuable time giving you advice
on equipment and bags of grain. Another story dealt with
that may make you money, the least you can do is put a little
someone who once dug through a trash can in the distillery
in their pocket. This small act will help the working distiller
looking for behind the scenes information.
feel like their time was not spent in vain. Being aware of and
He pulled an empty bag out of
respecting a distiller’s available time is also an important step to
the trash can and
making sure you’ll get their full focus and avoid annoying them. Make sure not to take up too much of their time. If possible, arrange ahead of time the length of your visit so you both know what to expect. One important aspect of asking for advice is location. Harris warned that if you’re asking for advice from someone who will be a direct competitor in the same local area, they will probably be leery of helping. Not many people want to help others who may end up taking money out of their pocket. “I don’t think they do it
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KEE HN MC PIRITS
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AMPB C E I G G
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asked “Is this the brand of yeast you use?” He was asked to leave. One of the most embarrassing stories he shared involved a new distiller trying to hire an employee out from under him. While Harris’s wife Becky (who the gentleman must not have realized was the president of the company) stood within earshot, he asked another employee about their salary and if they would be interested in working for someone else. The employee referred him to their boss, Becky, and he left without a new employee. Luckily, Harris says, those examples are rare. But they can still be valuable lessons, hopefully, for others who wish to open their own distillery. Despite these examples of uncomfortable situations,
collaborative nature of our industry. For many it is worth spending a little time to help a new distillery. Harris said “It is a collaborative based business, right? If you look at breweries, most of them have relationships where they really cheer each other on even though they’re competitors. I think that philosophy infuses distilling as well.” We’ve all felt the benefits of the friendliness of the distilling industry. That is why it is important to learn how not to abuse, but foster that camaraderie. While every distiller’s patience for answering questions is different, mutual respect will ensure that friendliness does not start to fade.
WWW.ARTISANSPIRITMAG.COM 69 presumed by the TTB to be missing product, and the tax
portion of the report must match
TOTAL figures on Lines 26 and
in Part I, a bulk accounting for liquids, especially when volume is temperature sensitive, will result in a net gain or loss during a given period when products are being
the report on page 1, the amount
entered in Line 2 is broken out in
the categories listed in Part IV on
page 2 of the report, with the total
entered on Line 67 in column (b)
matching the entry in Line 2.
report are basic account style as
products are shown on line 45
Lines 3 through for
Parts I and II of the Processing
volume in the containers/cases.
monthly Processing report.
used or used for
on Line 44.
based upon marked proof and
on Lines 25 and 46,
END OF MONTH, from the previous
as an event-driven
packages, where the amounts are
allowed and reported
and such may be
in the bonded storage,
for finished goods in bottles or
finished spirits that was reported
tanks or smaller bulk containers.
ON HAND FIRST OF MONTH, would
reflect the inventories of bulk and
entered into and removed from
The entries on Lines 1 and 27,
be from a known and
Return filed. A “loss” of
B of the next Excise Tax
summary information in Part I of Typically,
adjustment in Schedule
line 24 and GAINS on Line 7 would
CFR 19.343. In addition to the report.
amount as an increasing
two parts of the report.
specified in the regulations at 27
is expected to be paid on this
the 47 for the lower portion of these
a “dump and batch record” as
30. An inventory shortage is
spirits “dumped” to processing on
on Lines 8 and 31 for the upper
Part I of the report, which represents
of bulk spirits
or unexplained additional product
ending inventory. The TOTAL figures
compared to reductions plus the
Processing account on Line 2 of
This report reflects the quantities
MONTHLY REPORT OF PROCESSING OPERATIONS, TTB F 5110.28
cases, or bulk packages filled, held in bond, and shipped either taxpaid or without payment of tax.
Further, the Processing report provides in Part II and IV an accounting for finished goods in bottles/
entering, leaving and remaining in the Processing account, as reflected in Parts I and IV of the report.
Processing report, which reflects a monthly summary of bulk quantities of distilled spirits products
n the last article, the TTB Storage monthly report was presented. The current topic is the DSP
This is the third 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.
WRITTEN BY JIM MCCOY
MONTHLY REPORT of PROCESSING OPERATIONS TTB FORM 5110.28
DSP Federal Reporting
BOTTLED finished goods
deposited into the Storage account. This basic rule is meant to ensure that the products entering storage are kept within their already determined class and type while in Storage. Products of different class or type may not be mingled in the Storage account, also for this reason. This is re-stated from the instructions for
“dump” a quantity of neutral grain spirits into Processing, the requirement to list
the whole proof gallon totals for bottled imported spirits in column (c), and whole
wine gallons of domestic spirits bottled for domestic sale entered in column (d).
Columns (c), (e) and (f) are specialized categories rarely used in smaller operations.
the Storage report, for emphasis.
from the Processing account at another plant cannot be transferred in bond and
bottled. For example, to make a flavored “moonshine” specialty product, I enter or
A simple basic rule found in 27 CFR 19.351(c) is that bulk spirits cannot
be transferred back into Storage from the Processing account. Further, spirits
into Processing during the month.
always match Line 2 in Part I of the report, as this is the total proof gallons entered
in lines 49 through 66 for each column are totaled on line 67. Line 67(b) will
of that product made and filled into finished bottles. The total of the products listed
spirits “dumped” on Line 49(b), then report on Line 63(d) the whole wine gallons
headings in Part IV, rows 49 through 66, column (b), the quantity of each type of
spirits received into the Processing account. Under each of the class and type
PART IV on page 2 of the report captures in column (b) the proof gallons of
reported in Part III.
Rican and Virgin Islands rum, and other imported rum. Domestic rum is not
PART III of the form is only used for reporting the taxpaid removal of Puerto
It can be noted that the type of product dumped may not match the type of product
sale to a non-beverage drawback claimant.
generally not taxed unless packaged and removed for a taxable purpose, such as
the issue of whether the excise tax is due for the activity. Bulk spirits in bond are
are captured in Part I on Line 24. Accountability for case goods always involves
case/bottle count, is entered on Lines 9 and 28, and any LOSSES during bottling
occurs. The actual quantity filled into bottles, based upon the size and proof and
report. This is where the movement of bulk spirits into
bottles is reported. Line 9 will always match the entry on Line 28 in Part II of the
these lines. However, Line 9 is where the quantity of spirits actually filled into
fuel operations; most small beverage DSP operations would not be reporting on
or entry into a Foreign Trade Zone or into
SAMPLES OUT FOR
the rules in 27 CFR 19.434 regarding
Tax return and payment of taxes TTB Form 5000.24.
inventory on Lines 25 and 46 for each of the 4 quarter ending months, March, June,
As briefly as possible, the reporting of Processing operations on TTB Form
the Standards of Identity found in 27 CFR Part 5.
into the Storage account. Each line reflects a kind or type of spirits, as reflected in
The line headings in Part IV reflect specific types of spirits that you might receive
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 email@example.com
been presented in this writing. Next time we will review the preparation of the Excise
September and December.
5110.28, due to be mailed or filed through Pay.Gov by the 15th of each month, has
and rebottling. Losses and shortages are explained
PRODUCT IN FINISHED CASES THAT IS DESTROYED, and Line 40 reports any oops where a product is DUMPED BACK TO BULK for reprocessing 39 is for any
explanatory and little used for a small distiller. Line
Lines 34 through 38 are in general self-
to be documented and certified. That inventory would be reflected as the closing
for how to compute an effective tax rate for these
qualify for a slightly reduced rate; see the regulations
any product using wine or alcoholic flavors in it may
Most spirits are taxed at $13.50 per proof gallon, but
tax rate to establish the tax liability for the quarter.
will be the sum total of proof gallons multiplied by the
of taxes, Line 33 for the three months of the quarter
during the month. For quarterly filing
spirits removed “TAX DETERMINED”
Line 33 reports the quantity of
32(b) transferring out of the DSP.
there will never be an entry in Line
be an entry in line 29 (b). Similarly,
between DSPs, so there will never
goods cannot be transferred in bond
net total to be accounted for; case
matching Line 9 from Part I, and the
in column (b), the amount bottled
beginning inventory of case goods
II, Lines 27 through 47, includes the
Finished goods accounting in Part
would be reported on Line 19.
reported on Line 12, and any
BULK SPIRITS VOLUNTARILY DESTROYED
another DSP from Storage would be
TRANSFERS OF SPIRITS IN BOND
At the end of each calendar quarter, a physical inventory of bulk spirits is required
for Redistillation entry on Line 15 of the Production
such quantity would also be included in the Received
Line 17 reports any amounts RETURNED TO THE PRODUCTION ACCOUNT FOR REDISTILLATION; any
bulk spirits in bond which may be entered directly into
Line 9 of the Production report, plus any receipts of
the amounts from Line 17 of the Storage report and
the appropriate lines in Part IV on page 2 will include
on Line 2 in Part I of the Processing report, and on
by reduction to proof, blending and bottling. Entries
Processing account for creation of finished products,
will be the transfer (Dumping) of spirits into the
The most common increase in Processing inventory
removal of samples.
to report shipments of laboratory
Customs bond for bulk spirits. Line 18 might be used
are unlikely to be used. Line 16 might be for a direct
company for non-beverage use. Lines 11 and 14 to 18
withdrawal would likely be for shipment to a flavoring
generally a rare occurrence for a small distiller. Such a
Processing would be reported on Line 13; this is
TAXATION OF DISTILLED SPIRITS: A N A M ER I C A N P RO BL E M WRITTEN BY BY STEPHEN GOULD & JIM HYLAND
TA X AT I O N W I T H O U T R E P R E S E N TAT I O N
either customs duties or excise taxes today). This incident,
On the morning of June 10, 1768 British revenue agents
and riots by large numbers of Colonists, lead by the group known
converged on a pier along Boston’s wharf and headed toward the armed merchant ship Liberty. Upon arriving at the ship, they seized the Liberty and whatever cargo remained on board. History records that this cargo was a mix of trade goods, the bulk of which were casks of fortified wine (either Madiera or Port) and French Brandy. The ship was owned by the wealthiest man in the Massachusetts colony at the time—John Hancock—the man that would fund the “Sons of Liberty” and whose flamboyant signature would be the first to grace the Declaration of Independence. The Liberty was seized due to alleged violations of a series of laws known as the Navigation Acts, which had been enacted by British Parliament, creating taxes in order to raise funds to rebuild the British treasury after several very costly wars in the 1600s and 1700s. These laws and taxes were viewed by many Colonists as unfair, especially given that the Colonies had no voice in creating or administering those taxes, and that little, if any, of those funds went to benefit the Colonies (i.e. Taxation Without Representation).
American colonies aboard Liberty (these taxes would be called known as The Liberty Incident, led to several days of protests as the “Sons of Liberty”, and became one of the most important incidents leading up to the Revolutionary War. In fact, many historians consider the Liberty Incident far more important in the creation of the United States than the Boston Tea Party. In fact, many historians today believe that the alcohol-related taxes and the methods used to enforce them (such as the seizure of cargos) were directly responsible for several of the United State’s founding fathers decisions to fight for independence from England. At least three of the United State’s founding fathers, John Hancock, Thomas Jefferson and Benjamin Franklin lost significant sums of money due to cargos of brandy or other spirits being seized by British Revenue agents, and many historians credit these seizures as key events that led all three men to push for independence.
THOMAS JEFFERSON AND T H E “ S I N ” TA X O N S P I R I T S
The British authorities accused Mr. Hancock of not paying
Thomas Jefferson wasn’t very fond of distilled spirits despite
the appropriate tax on the wine and spirits imported into the
both the fact that he was an importer of spirits, including both rum
and French brandy, and that his loss of one or more shiploads of
Hamilton also argued that increasing the cost of distilled
French brandy contributed to his desire for independence from
spirits would limit their consumption, a fact he considered as
British rule. In fact, records show that he typically only kept
important as that of raising funds for the government. He stated,
Antigua Rum on hand at his estate, Monticello, and then only
“The consumption of ardent spirits particularly, no doubt very
for his servants’ use. This was likely due, at least in part, to his
much on account of their cheapness, is carried to the extreme,
having several employees, servants and close family members
which is truly to be regretted, as well in regard to the health
that had drinking problems.
and morals, as to the economy of the community,” and argued
In contrast, Jefferson was extremely fond of wine and to a
that increasing their cost through increased import duties and
lesser extent, beer, both of which he produced at Monticello.
domestic excise tax would encourage the consumption of cyder
He also purchased significant amounts of fine wine and in his
(cider) and malt liquors (beer), both of which, like Thomas
wealthier days maintained one of the finest wine cellars in the
Jefferson, he deemed as being healthier than distilled spirits.
Americas. As President, he built an impressive wine cellar for
A key issue with the new tax was that it increased the cost of
the White House. He also acted on several occasions as George
production, especially with respect to the small producers on
Washington’s wine buyer, building for him what was a world-
the western frontier in the Appalachian Mountains. These small
class wine cellar at the time.
farm distilleries typically produced whiskey from their excess
He was such an advocate of wine, which he believed promoted
corn and grain crops. The resulting whisky was then used as a
both health and what he termed “moderation” (he attributed
form of currency. As such, the farmers on the western frontier
his own longevity specifically to the combination of regularly
came to believe that they were being discriminated against by
drinking moderate amounts of wine and eating a largely
the Federal Government.
vegetarian diet), that he advocated for higher taxes on spirits
This view was, in part, also fueled by the structure of the new
and lower taxes on wine (and beer) from the early days of our
Federal Excise Tax. In the west, the price of whiskey was half
nation until the end of his political career. In 1818 he wrote
of what it was in the east. The effective tax rate, calculated
that “No nation is drunken where wine is cheap; and none
based upon the quantity distilled, much as it is today, effectively
sober, where the dearness of wine substitutes ardent spirits as
charged the western distillers twice as much when computed as
the common beverage. It is, in truth, the only antidote to the
a percentage of price.
bane of whiskey.” This argument, which he made repeatedly
Next, stills located outside of a city or town would be taxed
even prior to independence, is the first example of an American
based upon their capacity, not their actual production, creating
leader viewing distilled spirits as being more harmful than wine
even more animosity towards the Government on the part of
or beer, a view that has affected the tax structure on alcohol in
the United States from that time to the present. A view that has also long since been disproven by modern science.
To make matters worse the large distillers, typically based in the urban and industrialized areas in the east, were able to defer their taxes by posting a bond (again in much the same way we
THE DISTILLED SPIRITS TAX OF 1791 AND THE WHISKEY REBELLION Once America was an independent nation, the issue of taxes on distilled spirits would again rear its head, this time due to the U.S. Treasury needing funds to both pay debts from the Revolutionary War, and to fund the Federal Government of our new nation. To this end, Alexander Hamilton, then Secretary of the Treasury, proposed that distilled spirits be taxed, recommending in his first report to Congress in January of 1790 that the duties on imported spirits be increased, and that a new Federal Excise Tax, commonly known as the “Whiskey Tax”, be imposed upon all domestic distilled spirits. Both proposals were enacted by Congress and approved by President Washington in 1791.
do today), while smaller distilleries in rural areas such as those in the west had to pay their taxes prior to removal of the distilled spirits from their distilleries. These factors, combined, led the western farmer-distillers to view the new tax as intolerable, culminating in what has become known as the “Whiskey Rebellion” of 1794—America’s first Civil War. In response to this open rebellion, President Washington, accompanied by Alexander Hamilton and General Henry Lee, personally led a force of 13,000 troops into the west to put down the rebellion. The rebels refused to fight, however, and Washington returned to the east to resume his presidential duties. Hamilton and Lee remained in the west to round up and arrest the rebellion’s leaders, all of whom were later pardoned by the President. The Whiskey Tax was ultimately repealed in 1802
by Hamilton’s long time political foe, then President Thomas
The craft distilling industry has grown from a handful of
Jefferson, despite his personal beliefs regarding distilled spirits.
distilleries to a significant industry employing tens of thousands of people and generating hundreds of millions of dollars in
F E D E R A L E X C I S E TA X E S O N D I S T I L L E D S P I R I T S T O D AY
economic activity (and paying millions of dollars in taxes at the
Today’s Federal Excise Tax on distilled spirits is structured in
30% of the alcohol beverage market. At the same time Federal
many ways similar to that of the Whiskey Tax of 1791, in that it is based upon production (i.e. proof gallons produced) and that it taxes distilled spirits at significantly higher rates that other types of beverage alcohol (i.e. wine, beer, etc.). The current Federal Excise Tax rate for distilled spirits is $13.50 per proof gallon (i.e. one gallon at 100 proof / 50% Alc. by Vol), compared to $6.18 per equivalent proof gallon for beer and $4.86 per equivalent proof gallon for wine (i.e. the same amount of alcohol as is contained in a proof gallon). Further, during the 1980’s (prior to the craft distilling movement) special provisions were put in place to benefit small wineries and breweries. These provisions effectively lower the taxes paid by both groups to between $2.00 and $3.00 per equivalent proof gallon. It should be noted that distilleries weren’t deliberately left out of this process. Rather, there simply weren’t any small distilleries operating in the United States at the time these tax breaks were created. In the 1980s and early 1990s the first few small “craft” or “micro” distilleries opened, including Germain Robin and one other in 1982, and St. George and Charbay 1983. Since then the growth of what has become known as the craft distilling industry has been dramatic. In 2000 there were 24 in the United States, in 2011 there were 234, and only three years later that number had jumped to 580. Today, based on numbers reported by the TTB, there are over 900 distilleries operating in the U.S., the bulk of which are small producers producing less than 100,000 proof gallons of alcohol.
local, state and Federal levels). According to the Distilled Spirits Council of the United States, distilled spirits account for roughly Excise Taxes on distilled spirits account for 56% of all alcoholrelated excise taxes collected by the Federal Government. As a result, members of the craft distilling industry have increasingly called for the Federal Excise Tax on distilled spirits to be brought more in line with what beer and wine producers pay. The argument is simple: modern science has shown that “alcohol is alcohol”. Therefore, beer, wine and spirits should all be taxed at the same rate based upon the amount of alcohol produced. Initially, this was a poorly organized handful of distillers with an interest in changing the tax laws, but without the political weight to make those changes a reality. In recent years, however, things have started to change. The industry is getting organized, and various industry groups including state distiller’s guilds, The American Craft Spirits Association (ACSA), and the Distilled Spirits Council of the United States, are all now talking and cooperating at various levels to achieve some sort of Federal Excise Tax Reform. Industry leaders from ACSA and various state distillers guilds have held two rounds of visits to Washington, D.C. to promote the industry and seek fairness in the tax code, and more are planned. The results have been very promising. Currently there are five bills that have been introduced that speak to craft distillers and a lower FET. In May of this year, leaders of the ACSA made a number of visits on Capitol Hill. These visits were instrumental in getting H.R. 2520, the Distillery Innovation and Excise Tax Reform Act, introduced by Rep. Todd Young (R-IN) and John Yarmuth
(D-KY). Ted Huber, ACSA Vice President, is a constituent of
craft distilling industry to continue their involvement to keep
Congressman Young’s. The legislation has two key components.
this momentum going and get our legislation passed.
First, the legislation would reduce the federal excise tax (FET)
HOW YOU CAN HELP
on the first 100K of production to $2.70 per proof gallon. Second, the legislation would also lower from $13.50 to $9.00 per proof gallon the tax rate for distillers producing above 100K proof gallons, putting the spirits industry more in line with the FET for beer and wine. That was just the first step. After a few months of small distillers telling their story of a need for fairness in the tax code, key members of the U.S. Senate got involved. Two bills there
Contact your congressmen and senators and tell them that you will appreciate any effort they would make to help the craft distilling industry by supporting any legislation that reduces the Federal Excise Tax on distilled spirits produced by small craft distilleries. These pieces of legislation are:
would reduce the federal excise tax (FET) on the first 100K
HR 2903 / S 1562
of production to $2.70 per proof gallon. S. 1444 introduced
The Craft Beverage Modernization and Tax Reform Act of 2015
by Senator Gary Peters (D-MI) deals only with a small distillers excise tax reduction. He is joined on that bill by four other
HR 2520 / S 1444 The Distillery Innovation and Excise Tax Reform Act of 2015
HR 867 / S 1179
S.1562, introduced by Senator Ron Wyden (D-OR), would
The Aged Distilled Spirits Competitiveness Act
help small distillers with the excise tax reduction just like S. 1444, but also craft brewers and small wine producers. Notably,
HR 2238 / S 904
Senator Wyden is the most senior Democrat on the Senate
The Craft Beverage Bond Simplification Act of 2015
Finance Committee, the Committee with primary jurisdiction over tax issues and a very influential member of the Senate on tax matters. Senator Wyden turned to our industry first to seek our support. ACSA President Tom Mooney was on stage with him when he introduced the bill. This bill now has 14 Senators as co-sponsors. Senator Wyden’s efforts have now resulted in the introduction of HR. 2903, a companion bill in the House introduced by
Next, tell them that the craft distilling industry, one of the smallest segments of the alcohol beverage industry, receives the most disparate treatment under the tax code. There is NO reduction of FET rates for small distillers, while small brewers and wineries receive substantial FET reductions—and that this “fairness” issue should be a priority if it can make its way into a tax bill this year.
Congressman Erik Paulsen (R-MN). A number of Members of the Ways and Means Committee (the tax Committee in the U.S. House) have signed on as original co-sponsors. This bill has over 70 co-sponsors. All of this has happened in the first eight months of 2015. It is important for small distillers and those that support the
Stephen Gould is Proprietor and Distiller of Golden Moon Distillery in Golden, CO. For more info, visit www.goldenmoondistillery.com or call (303) 993-7174. Jim Hyland, of the Pennsylvania Avenue Group, is the American Craft Spirits Association’s dedicated lobbyist on Capitol Hill.
Your Ideal Package, From Concept to Reality Phoenix Packaging offers custom packaging solutions that make your spirit shine as much on the outside as it does on the inside. From bottles to closures to decoration, every detail of your packaging will reflect the soul of the contents within.
Your Ideal Package, From Concept to Reality
G I A B T A D
H T S W E O L R A S G & G S N D N OREN LI E T TIL UR T S I U D E F TRY Y
THDUSTOR C N E I RAJ T SH E LI L KE Y N B E I TT R W
IN L V
BIG DATA IS MORE THAN A BUZZWORD that gets thrown around because it sounds important. The analytics now being collected thanks to new technologies is helping more industries understand who they are serving and what it is that consumers really want, just by looking at buying trends, demographics, and sales figures—and that includes our industry segments like beer, spirits, wine, cider, and mead.
CRAFT BREWING The past few years have seen phenomenal growth for craft beer
and Southeast are the hot growth markets for now and into the future, according to the same Nielsen survey. When it comes to where craft beer can be found, the survey noted that it can
with 10.9% growth over the last decade, and there is no sign
be more likely found in the grocery channel (20.1%) than the
that this growth will slow down. According to 2014 estimates
convenience (4.6%) and drug (8.7%) store channels. However,
from CraftBeer.com, growth by volume increased 18% and 22%
craft is making a strong run in the convenience channel, growing
by dollar shares. The number of craft beer barrels went from
at a faster pace there (+21.4%) than in grocery stores (+13.7%)
16.6 million in 2013 to 21.7 million in 2014. The retail value
for the 52 weeks ending June 20, 2015.
associated with this volume of craft beer sold also rose, from
According to the Brewers Association, there are some
$14.3 billion in 2013 to $19.6 billion in 2014. In 2013, there
interesting data points around the demographics of those that
were 2,768 craft breweries, including 1,237 brewpubs, 1,412
prefer craft beers:
microbreweries, and 119 regional craft breweries.
Nielsen has statistics from 2015 that prove that craft beer is only on the rise. While the entire beer category grew just 0.6% in a year that ended June 20, 2015, craft beer volume during that same period grew 10.2%. The word “craft” also seems to inspire consumers, especially younger men of drinking age. According to a recent Nielsen study of craft beverage alcohol conducted online by Harris Poll, 35% of adults, 21 and older, said they’re more interested in trying an adult beverage labeled craft. Among men 21-24, that figure jumped to 46%. Among the men interested in craft beer, they described it as having three main traits: coming from a small, independent company (56%); part of a small batch (50%); and handcrafted (43%). Women were more likely to associate it with products that are handcrafted (47% vs. 41%) while men are more likely to associate the term with small batch production (54% vs. 45%). Additionally, handcrafted, artisanal, higherpriced and quality seemed to be more important to younger consumers (ages 21-34), while small batch production, made by a small independent company and produced locally, were ranked higher by older consumers (ages 55-64). Locally produced beers were important across all groups. In looking at regional growth, it would appear that the Midwest
75% of all drinkers now live within 10 miles of a craft brewery.
Young women, ages 21-34, now consume craft beer over index (over the national average, and represent 15% of the total consumption).
The bottom 60% of households in income now consume 40% of the country’s craft beer by volume.
WINE Like all other craft segments, wine is also on the move upwards. There are now 8,287 wineries in America, which is a 6.8% increase, according to Wine Vines Analytics. More wine is also being consumed, up by 5.6% over the previous year. Jon Bonné, author of The New California Wine: A Guide to the
Producers and Wines Behind a Revolution in Taste, has noted many trends that are shaping the future of the industry. First, there has been a generational shift, starting in 2011, from a model of big wine, big flavor, and big alcohol found in traditional Cabernet and Chardonnay, to more restrained styles that use
Italian, Spanish, and French varietals. With this movement
gone from just over four million cases in 2010 to approximately
also comes a change in the approach to winemaking—from the
26 million cases in 2014.
scientific to the more creative. As part of a true craft movement,
Mead doesn’t trail too far behind in the excitement among
this includes a willingness to try new vinification techniques and
drinkers. For example, the American Mead Makers Association
blends. There is also a focus on the land, which is believed to
saw a sales increase in 2014 alone of 42%, while sales over the
impart specific character into the grapes. Additionally, this new wine revolution is producing artisan wine at attainable price points, opening it up to more people
period from 2012 to 2014 jumped 84%. The meaderies in the U.S. now stand at 150 while wineries that make at least one mead product total 236.
to develop an interest rather than promoting an exclusive, ultraexpensive “cult wine” club. Although California is still making 90% of the wine produced
in the United States, the future shows more growth in the craft
It would seem as though more people are not married to one
wine movement throughout Washington, Virginia, Missouri and
type of tipple. In fact, Millennials are equal opportunity drinkers
New York. All signs point to more of these smaller wineries
as opposed to category drinkers from other generations. For
beginning to attract the attention of the new wine drinker.
example, Technomic noted that this trend is particularly popular among the 25-34 year old set across beer, wine, and spirits (as
CIDER AND MEAD The popularity of cider and mead in just the last year-to-two years has grown significantly along with the introduction of many new products in this craft beverage market segment. The United States Association of Cider Makers reported that cases have
SPIRITS — FINAL THOUGHTS Now, let’s close with the state of the craft spirits industry and
how all this growth in the craft beverage market is good for the
year. According to the American Distilling Institute (ADI), in
2005 there were only 50 craft distillers compared to the over
In the craft spirits segment, there are more than 800 small
600 in 2013.
distillers throughout the U.S. now. To illustrate the incredible
All indications point to the craft distillery segment taking
growth spurt in this area, there were only 92 small distillers in
flight in a similar way to craft beer, cider and mead, as well as
2010, according to the Distilled Spirits Council of the United
the new movement in wine. There are signs that craft distillers
are benchmarking some of the tactics used in craft beer that
It may well be that there are so many more small distillers
have led to explosive growth in that segment, including finding
because the demand has shot up. Total case volume in 2014
new revenue streams in the form of tasting rooms, branded
reached 3.5 million cases, which is a 500% increase over 2010
merchandise, and partnerships with culinary companies and
when there were only 700,000 cases of craft spirits. Although
chefs to create new taste experiences. The Big Data reports here
craft spirits account for only 1.7% of the total spirits market,
show exciting and ongoing growth opportunities for all within the
all these signs of growth point to larger market share with each
craft beverage industry, especially for the rising spirits star.
passing year. In showing the growing popularity of craft spirits, the National Restaurant Association (NRA) placed micro-distilled/ artisan spirits as the top trend of 2015. The number of artisan distilleries in the U.S. has exploded, increasing 30 percent a    
Kellie Shevlin is Executive Director of the Craft Beverage Expo, a comprehensive conference tailored specifically to suppliers of craft wine, beer, and spirits. For more info visit www.craftbeverageexpo.com or call (202) 288-8898.
http://www.craftbeer.com/breweries/support-your-local-brewery/craft-brewing-statistics http://www.nielsen.com/us/en/insights/news/2015/tapped-in-craft-and-local-are-powerful-trends-in-the-beer-aisle.html http://www.pastemagazine.com/articles/2014/10/the-expanding-demographics-of-craft-beer.html http://www.techtimes.com/articles/25477/20150109/the-top-10-predicted-wine-and-beer-trends-of-2015.htm
Fruit D i s Ferm ti ll ate entat ion
TTH HE E AAR RTT AA ND N D SSCC IIE EN NCCE E OOFF
Fruit-based spirits, or brandies, once sat on top of the alcohol food chain. Unfortunately, few things stay the same
forever, and fruit-based spirits fell in popularity behind grain-based spirits such
BY A TTI
LA K OVA
as whiskey, vodka, and gin, due to poor harvests, wars, alcohol prohibition, and a host of other
PA P AR RT T 11
CS A ND M ARAT
reasons. However, in recent years, fruit-based brandies have enjoyed a rise in popularity across the globe. This trend started in Europe, where many countries have continued distilling fruit-based spirits rooted in national tradition: Germans distill Schnapps, Grappa is Italy’s national spirit, Greeks drink Ouzo, Spain has Orujo, Poland produces Sliwowica (or Slivovitz), Romania enjoys Tuica, and in Hungary there is Pálinka. The distilleries in these countries have developed their own distilling techniques and styles, primarily by focusing on improving the fruit fermentation process to obtain higher alcohol yields and better product quality. This three-part article series will discuss the topic of fruit selection, preparation, and fermentation for an eau de vie, EDV, style brandy. In part one of the series, we will discuss the characteristics of a quality EDV, fruit sourcing, fruit preparation for fermentation, the basics of fermentation, and yeast selection.
CHARACTERISTICS OF A QUALITY EAU DE VIE (EDV)
A top quality EDV captures the essence
timing when making the cuts during
and the soul of the fruit on the nose,
distillation, or poor sanitation of the
on the palate, and in the finish. From a
equipment between production runs.
An exceptional EDV is built on the
judge’s perspective, there are five major
following three principles:
1) Use the best available fresh and ripe fruit
2) Design the fermentation process based on the characteristics of the fruit used
3) Execute the perfect distillation with focus on making the cuts of heads, hearts and tails at the right time based on the fruit used
qualities used to evaluate an EDV. Using a traditional tulip-shaped glass, judges focus on:
Aroma specificity The product’s aroma should be specific to the fruit that it is made of. The secondary floral and fruit aromas can
supplement the characteristics of the
The aroma of the spirit should be
primary fruit aroma, making the tasting
flawless, recalling memories of ripe,
experience more complete. Having the
fresh fruit, or an aromatic fruit jam. The
secondary aroma present in the distillate
presence of solvent-like or off-putting
is a good indicator of a quality EDV,
aromas are signs of low quality fruit,
however, it should never overwhelm the
improper fermentation technique, wrong
specific aromas of the primary fruit. If
someone can tell that the spirit is made
EDV requires fragrant, flavorful, and
preparation. While simple to understand,
of Stanley prune-plum (Prunus domestica
sugar-rich fruit. Past practices of using
if not treated properly, various factors can
â€œStanleyâ€?) that means that the distiller
fruit that has fallen on the ground or
ruin the mash. For example, bacteria on
used the right type of plum and did a
rotted should never be entertained by a
the equipment, poor fruit selection or
good job representing that plum in the
distiller serious about producing a quality
rotten fruit, bad water (too many salts,
brandy (and of course that the judge has
EDV. While fruit juices and concentrate
improper pH, presence of chemicals), the
a good nose!).
could be used, the EDV produced using
use of inadequate sanitizing equipment,
these alternatives typically lack the aroma
and the presence of detergents from poor
that would be obtained from fresh fruit
washing practices are a few of the more
picked at the peak of harvest.
common culprits that can ruin your mash.
Taste purity The product should be clean, with no burn or foreign flavors of sourness or bitterness on the palate.
Each fruit and varietal will present
In a recent case study, an EDV distillery
in Hungary was distilling a pear brandy,
challenges. When sourcing, look for
and upon the first sniff of the distilled
The product must taste like the fruit
aromatic fruits with the right level of
spirit, the master distiller identified an
that was used for the base of the spirit.
ripeness. Generally, fruit that is over-
issue with the mash. The aroma had
The additional sweetness or bitterness
ripened produces a final distillate that
traces of ethyl acetate and acetaldehyde
can come from the fermentation or from
lacks fresh fruit characteristics and
in the heads which are sure indicators
the seed of the fruit, making the taste of
aromas, and gives a jam-like taste to the
that there is bacteria in the mash being
the spirit more complete. However, this
spirit. If the fruit is unripe, then the final
distilled. Given the fact that the spoiled
should never overwhelm the primary fruit.
product will lack aroma and the distiller
mash would yield low quantities (due to
can expect a lower spirit yield due to
longer heads) and a poor quality product,
lower quantities of fermentable sugars
the distiller decided to stop the distillation
present in the fruit.
run and dump the entire batch. This
Harmony The aroma and taste should be in
balance. When consuming a spirit, the
If conditions allow, it is important to
example shows the costly consequences
first natural first step is to smell the
know where your fruit comes from and
when proper sanitary procedures are not
product, to breathe in the complex fruity
to actively work with your orchard or
and floral aromas. The second step is to
supplier. When visiting the orchard, use
The presence of wild yeast, bacteria,
taste the product with an expectation of a
a refractometer to measure the BRIX
or mold will metabolize with the sugar
long lasting pleasant taste of the fruit that
or sugar content of the fruit. Manual
in the fruit mash and develop pungent
was used to create the spirits. A taste that
refractometers are available, but digital
compounds. To avoid this, make sure
falls short of what the aroma promises is
devices are easier to use, clean, and
that all tools and tanks are sanitized
considered out of balance.
provide more accurate results. Look for
before starting to process a new batch of
more sugar-rich fruits (higher BRIX reading
fruit. Use the acidic, food-grade cleaning
on the refractometer) as this will provide
agents, and if possible, steam, to wash
a higher alcohol yield for your mash.
and clean the equipment, as this will
Exceptional EDVs must deliver on all
placing equal emphasis on sourcing the highest quality raw ingredients and flawlessly executing the fermentation and distillation processes.
FRUIT PREPARATION FOR FERMENTATION Sanitizing & Washing
Much like when dining in a fine
Having sourced the right fruit for
steakhouse, where the best steaks come
the EDV, next comes the critical step
from the finest cuts of meat, a quality
of sanitizing the equipment for mash
the tanks, hoses, grinders, and other equipment has been cleaned, rinsed, and sanitized, the next step is to clean the fruit using the proper washing technique. There
techniques than can be used depending on the type of fruit. For example, pome (e.g., apple, pear) and stone fruits (e.g.,
plum, apricot, cherry) can be washed with a
potentially poor spirit quality.
submerging technique. Softer fruits, such as
When mashing stone-fruits, make sure to
berries (e.g., raspberries, blackberries) must
remove the pits. Pits must be removed before
be washed very carefully, using a shower wash
mashing the fruit and there are special grinders
technique. When making a berry brandy, be
that perform this step by removing and separating
mindful of how your supplier transports the
the pits from the fruit flesh. The removed pits
berries. At times, the bottom portion of a crate
can be dried and a small quantity put back in
of berries can get smashed. If this happens,
the mash prior to distillation, providing additional
skip washing the entire crate because this would
aroma complexity for the final product.
wash out all the precious juice from the fruit.
When working with grapes, extra attention must
Acid treatment can be used to sanitize all the
be paid to the seeds to ensure that they remain
berries to avoid the risk of contamination during
intact. The goal is to avoid getting grapeseed oil
in the brandy and therefore a more chunky mash
During the washing process avoid using hot
water and make sure that you remove every
little bit of soil that is still stuck to the fruit. Depending on your equipment, either as you wash or afterward, make sure to inspect the fruit
For both fruit and grain fermentation, the
to remove any rotten or damaged pieces. When
raw material dictates the required fermentation
dealing with pome or stone fruits, be mindful of
conditions. However, there is less room for error
bruised pieces and remove them from the batch.
when dealing with fruit fermentation, and the final
Bruised fruit could introduce the fruit’s wild
product yields are much lower when compared to
yeasts, molds, and bacteria into the mash that
more starchy grains.
could ruin the sensory quality of the product and decrease alcohol yield.
Grinding Grinding the fruit to a juicy, pulpy, apple sauce-like consistency is a critical step in ensuring the successful fermentation process. During the fermentation, the fruit mash can be compared to a small ecosystem that lives inside the fermentation tank. In this ecosystem, the yeast, mold, and bacteria are racing and fighting each other for food and for space. Additionally, the mash is a constantly evolving medium where natural compounds like sugars and acids dissolve, alcohol and other yeast metabolites penetrate the fruit cells, enzymes catalyze reactions, and various chemical and biochemical processes
In EDV production, the quality of the fruit provides the primary aromas and the fermentation imparts
Secondary aromas are the “additional” aromas beyond the original fruit aroma that form due to yeast metabolizing and extracellular enzymatic reactions that take place when fruit and yeast cells pass their enzymes into the mash. These enzymes meet substrates and catalyze reactions, resulting in the formation of new compounds. Some of these compounds are volatile, meaning they evaporate and make their way into the final product during distillation, whereas non-volatile compounds (such as glucose) remain in the mash.
occur. With this in mind, it is important to break
In grain mashes, maltose (or malt-sugar) and
down pome and stone fruits, and berries as much
glucose are two of the most abundant sugars,
as possible prior to fermentation. A finer grind
while fructose, glucose, and sucrose serve as the
will expose more fruit surface and sugars for the
most abundant sugars used for alcohol production
yeast to consume. A chunky mash can result in a
during fruit mash fermentation. The difference in
less aromatic final product, lower spirit yield, and
the type of the sugar may be considered minimal,
but has a significant impact on yeast
production, and the types of secondary
metabolism. Since different yeast strains
aroma compounds that are formed.
produce off-putting aromas. Through a considerate yeast selection,
have different “tastes” for substrates,
Imagine it like a novice tackling their
the use of good raw material, and the
the right yeast selection is critical for
first woodworking project. They will get
right mashing technique, you can provide
there eventually, but may not perform the
the necessary conditions for yeast to
efficiency for fruit distillates. The type of
task as quickly, efficiently, or precisely
yeast being used for a bourbon may not
as a skilled carpenter. When choosing a
Ultimately, the aroma profile of the
be the best choice for the production of
yeast strain to ferment your mash, make
final product can be achieved through
an apple brandy. Furthermore, a yeast
sure that you can provide the optimum
appropriate yeast selection.
that may work for apple brandy will not
conditions to your yeast, or risk ending up
be optimal for pear brandy.
with a mediocre mash and end product.
When yeast faces “stress conditions”,
Furthermore, a fruit mash is always
acidic, much more so than a grain mash.
dioxide level, or high alcohol level, it
The higher acidity and the presence
cannot perform at the same level as it
of additional microbes result in more
would under optimal conditions. The
stress conditions that impact the yeast.
yeast enzyme-set (or composition of
These stress conditions create different
special proteins) defines its viability and
compounds in the mash as the yeast
fermentation capabilities to do its work
metabolizes sugar into alcohol. Some of
under a set of conditions. Changing the
the compounds can be good for the final
ambient condition affects the speed
product and produce pleasant secondary
of fermentation, efficiency of alcohol
aromas, while other compounds can
In Part 2 of this series, we will take a closer look at the fermentation process of fruit mash.
Attila Gabor Kovacs is a PhD scholar and an industry recognized expert in the fermentation and distillation of pálinka, a Hungarian fruit brandy. Attila has over 9 years of academic, research, and professional experience in distilled spirits production and assessment. He has developed and taught Bachelors and Master’s courses, and authored publications about pálinka production and origin identification. Attila is a member of the National Pálinka Committee and a distilled spirits sensory judge.
YO HO HO AND A BOTTLE OF ( LY O N ’ S ) R U M WRITTEN BY AMBER G. CHRISTENSEN-SMITH
PHOTOS BY JAIME WINDON
“There’s naught, no doubt, so much the spirit calms a s r u m a n d t r u e r e l i g i o n . ” –LORD BYRON
um, the bounty of a pirate’s booty—derived from the byproducts of sugar production, is an age old liquor laden with delicious flavors of caramel, vanilla, clove, and cinnamon, and has been enjoyed by the newly christened
imbiber and the more established connoisseurs of spirits for generations. Some mix it, some sip it on the rocks, but most agree the taste can be delightful in any form.
RISING SUN Ben Lyon, co-founder of Lyon Distilling Company in St. Michaels, Maryland, has fallen in love and delivered some amazing rum products all thanks to his passion for distilling and personalization of his product—and his spirits can tantalize any palate. He eagerly pours himself into
profiles. “We don’t do market research,
great profiles, even if the process is less
we don’t pander to trends, and we are
than efficient according to the masses.
most concerned with making spirits that
“Pot stills give you a profile that you just
we find interesting, and that we want to
can’t fake,” notes Lyon, “and committing
drink,” shares Lyon. They are, without a
to this relatively time-inefficient process
doubt, in this business to produce quality
is a tremendous part of how our spirits
and distinct spirits.
taste.” They have put aside the thought that they need more efficient equipment
each bottle that is crafted and shared with
A D V E N T U R E G A L LY
consumers all over Maryland and beyond,
Lyon Distilling Company proves that you
and he is known for paying personal
don’t have to take over the world to be a
attention to each bottle he produces with
successful distiller. While some distillers
his approval and signature being found on
dream of breaking barriers and making a
each released item.
dent in market share nationwide or even
than pot stills, as their dedication to great flavor is what keeps them satisfied with their quality and it’s what customers appreciate about their spirits.
Lyon Distilling Company was founded
worldwide, the crew at Lyon Distilling
Lyon Distilling Company is excited
in 2013 by Ben Lyon and Jaime Windon.
realizes that being sincere and authentic
about the innovation present in the
They come from a background of working
in running a small business works well for
craft distilling industry as a whole and
in other distilleries and hospitality trades.
them and their happiness in the industry.
is pleased with the number of choices
They are inspired by blends of cane
This craft distilling company focuses
available at this time. “We are in the
sugar and molasses that make up their
on quality in all aspects. They are keen
midst of an amazing moment in history
rum, which is made in batches using pot
on sharing just how important their pot
where the spirits are not only better
stills that undoubtedly deliver superb
stills are in creating rum and whiskey with
than ever, but the number of choices is
larger than any of us imagined,” Lyon excitedly shares. “From a practical standpoint, I am most excited by the development in production methods. Craft distillers are notorious for ‘breaking rules,’ and whether it’s small barrels, ingredients, finishing and fermentation methods, or even the styles of stills themselves, distillers are really pushing the envelope on what’s actually possible.” They have found that the community of craft distillers helps the industry be even more likeable as a business model. They have discovered resources in this tight knit community that have helped them along the way and know that others can pay it forward, as well. Lyon Distilling has lots of people to thank for
Captivating capsules Riveting labels
its success—Michael and John at New Columbia Distillers in D.C. for their resources and support for beginners, The American Distilling Institute for the information they share, and Randy at 888 Distilling for his personal education of Ben at his distillery. Building friendships and relationships with others in the craft distilling industry, Lyon notes, helps one to succeed.
VICTORY Lyon is happy to have community support and to have built a distillery that is appreciated by the people around them. He and Jaime work to ensure they are personally in the tasting room and giving tours of their facility in order to build relationships with their consumers. “People appreciate the simple authenticity of what we do, and there is something special about having the people who actually made the spirits introduce them.” For the future they have many goals, including increasing efficiency, reducing their environmental impact, and increasing their current production volume. Overall, they believe all CUSTOM CAPSULES and CAST METAL LABELS
distillers need to continue to step up their game in every way possible. “Producing better spirits, being good neighbors, and maybe most importantly, fostering friendships and relationships with other distillers. There aren’t that many of us, so we need to stick together,” shares Lyon. In further focus, Lyon mentions the importance of everyone helping with legislative action. “We are good constituents for a variety of reasons, and our legislators need to hear from us.”
Ramondin USA Napa CA
Additionally, in order to create a superb product and to be seen as an important community member, he points out how passion—
rather than research—can grow your business: “Stop looking at
the trends, and figure out what it is you like. Do that, and your passion and enthusiasm will come through in the glass.”
QUOTATIONS – firstname.lastname@example.org
Metal labels by Apholos – distributed in Nor th America by Ramondin USA
Lyon Distilling Company is located in Saint Michaels, MD. For more info, visit www.lyondistilling.com or call (443) 333-9181.
SUGAR UTILIZATION AND IMPORTANCE RELATIVE TO FERMENTATION AND DISTILLERY ETHANOL YIELDS W R I T T E N B Y P AT R I C K H E I S T, P H . D
PHOTOGRAPHS PROVIDED BY FERM SOLUTIONS, INC.
ermentation—as it relates to beer, wine, and liquor
fermentable substrates include various forms of cane products
production—is often described as a process carried out
like granulated sugar or molasses. The sugar in cane products
by yeast and bacteria in which sugars are converted to ethyl
is sucrose, a disaccharide (or two component sugar) consisting
alcohol. The “sugar” part of that equation is essential for alcohol
of glucose and fructose subunits. These sugars are readily taken
production and is a significant factor when calculating yield
up by the yeast and do not require pre-processing or enzymatic
from any particular “feedstock”, which is the starting material
conversion. When fermenting these substrates, sometimes the
(or substrate) for fermentation, supplying the sugar to the yeast.
only other required additions are yeast and water. We generically
Some sugars like sucrose, fructose and glucose found in cane
use “yeast” here to mean the typical brewers/distillers yeast
molasses or granulated sugar are readily fermentable and do
Saccharomyces cerevisiae. That is important to note because
not require enzymes or other catalysts to break them down prior
there are other sugars (lactose, for example) that may require
to uptake by the yeast. Other feedstocks like corn, wheat and
a different yeast (Kluyveromyces species, for example) for
other grains have sugar (glucose, a.k.a. dextrose) that is bound
complete sugar utilization and successful fermentation.
together in the complex carbohydrate “starch”. In the case of
It may be necessary to add additional nutrients when
starch, the sugar must first be released by enzymatic activity,
fermenting certain feedstocks like granulated sugar. The reason
heat and other factors before it can be fermented by the yeast
is that although granulated sugar is full of carbohydrates, it
to make ethanol. This is why grain-based spirits like bourbon
has little of the micro- or macronutrients needed for other cell
and whiskey involve elaborate cooking strategies to release
processes. One of the most likely elements to be limiting in
sugars prior to fermentation. Here we discuss the various factors
a sugar solution (sugar wash) is nitrogen. However, there can
associated with sugar utilization by yeast during fermentation,
also be other nutrients that are limiting. If you are unsuccessful
and how residual sugars leftover after fermentation can affect
fermenting a substrate containing readily fermentable sugars by
ethanol yield. We will also look at starch and other complex
adding only water and yeast, try adding nitrogen to see if that
carbohydrates, how they can vary from one source to another,
solves the issue. Beverage distilleries typically use food grade
how they are broken down (converted) into simple sugars, and
di-ammonium phosphate (a.k.a. DAP) when supplementing with
how to diagnose issues related to sugar uptake in fermentation.
nitrogen. A successful fermentation is when all of the sugars are utilized and if the desired amount of ethanol was produced
READILY FERMENTABLE SUGAR SOURCES In certain feedstocks, including grapes and various fruit, the sugar content is in a form (sucrose, glucose and fructose, for example) that is already available to the yeast for fermentation and production of ethyl alcohol. Other examples of readily
relevant to the starting sugars (typically measured as Brix, Balling and/or Gravity). If supplementing with nitrogen doesn’t do the trick, it may be necessary to add more complex nutrients like yeast extract, malt extract or peptone. There are also several available nutrient supplements available on the market. Table 1 shows how fermentation progresses in a solution with only sugar, water and yeast (A) versus adding nitrogen/DAP (B) or
TABLE 1 Fermentation of granulated sugar (18% Brix) with and without supplemental nitrogen and/or complex nutrients. Results shown are at 72 hours.
adding nitrogen plus additional
Sugar, water plus yeast
Sugar, water, yeast plus DAP (nitrogen)
Sugar, water, yeast plus DAP, plus complex nutrients
Sugar, water, yeast and complex nutrients (no DAP)
the sugar is nearly unfermentable alone and requires not only additional nitrogen,
This is not always
success of fermentation and ethanol yields.
the case for other substrates like molasses or other “syrups”, which often contain additional nutrients and may require less
STARCH-BASED FEEDSTOCKS AND OTHER COMPLEX CARBOHYDRATES
supplementation than when fermenting sugar alone. There is a limit to how much sugar can go into solution before osmotic stress (more commonly known as “sugar shock”) starts
Before jumping straight into fermentation of starch-based
causing issues with the yeast. Thus, there is a “sweet spot”
feedstocks, it is important to first discuss the relationship
(no pun intended) for sugar concentrations, which depends
between fermentable sugars and more complex carbohydrates
on the source (granulated sugar, molasses, high fructose corn
like starch. One simple analogy is that if starch is a string of
syrup, etc.), whether there are any toxic factors that may require
beads, then each bead represents a glucose molecule (just a
dilution, and related factors. For molasses and granulated sugar
reminder, dextrose is the same thing as glucose and the two are
a Brix of between 17-20% is a good place to start and then
used interchangeably). Starch has different conformations, and
increase or decrease as necessary to achieve the desired results.
is made up of either linear chains of glucose (called amylose)
Although a substrate with readily fermentable sugars like
or more highly branched amylopectin. Amylose uses one type of
molasses may not require heating in terms of sugar utilization,
bonding to connect the glucose molecules together (alpha 1,4),
sometimes heat is implemented to lower any potential microbial
(A) Amylose CH2OH H OH
O H OH
whereas amylopectin uses a combination of those same alpha
contamination, which can improve the
6 CH2OH 5 O
(1,4 or 1,6, in this case) describe which
O H OH
1,4 bonds as well as alpha 1,6 bonds. The numbers
carbons on each glucose are connected, so H OH
of fermentable sugars, they just first need to be released before the yeast can utilize them. It makes sense that the less complex the molecule (in this case amylose), the easier it is to release those glucose subunits. Thus, feedstocks where the starch has a higher
OH 6 CH2
(FIGURE 1) Structure of amylose (A) compared to amylopectin (B).
#4 of the next glucose molecule in the branching occurs. Thus, starch is composed
glucose molecule is connected to carbon chain. The alpha 1,6 bonds are where the
a 1,4 bond means that carbon #1 of one
H OH 3
H OH H
O H OH H
amylopectin ratio (certain rice cultivars, for H OH
example) may be more difficult to convert to fermentable sugars, compared to one with a higher ratio of amylose. Figure
1 shows the basic structure of amylose (A)
(FIGURE 2) Structure Micrographs of swelling starch buds during cook. This is where amylose and amylopectin are released.
versus amylopectin (B). Note the difference in structure between amylose (A; linear; unbranched) and amylopectin (B; branched). Also notice the location of the alpha 1,4 and 1,6 bonds and how the carbons are connected. Also worthy of mention is that although glucose is the basic subunit of starch, there are other configurations of glucose that are fermentable by yeast. For example, maltose (a disaccharide consisting of two glucose subunits) is fermentable, so it isn’t a requirement that starch be broken all the way down to glucose to be fermentable. This is explained below as we get into malt-mediated starch conversion. Conversion of starch into fermentable sugars is carried out by biological catalysts called enzymes. Enzymes that break down starch into fermentable sugars include alpha- and glucoamylases, among others. These enzymes cleave the starch in different ways such as at the 1,4 or 1,6 bond, from within the molecule or from the outside, which we won’t go into detail here due to the complexity and potential confusion that may result. Starch-degrading enzymes are produced when seeds like barley and other grains are germinated/sprouted. If you think about how plants get their energy from sunlight, then it makes sense that a developing seedling underground and away from light would need an alternate plan for making energy. Thus, during seed germination, enzymes are produced that convert the starch into useable (fermentable) sugars/carbohydrates (maltose and glucose, for example) that the seedling uses for generating energy until it grows above ground and can use sunlight for photosynthesis. An additional benefit of malted grains apart from producing enzymes that hydrolyze/breakdown starch is that the released sugar from enzyme activity lends a sweetness to the mash. Distilleries that ferment grain but do not incorporate malt can use commercial enzymes to convert the starch to fermentable sugars. It is also important to note that when malted grains are used as the sole source of enzymes the resulting sugars include primarily maltose, but also some glucose. In many cases, even distilleries that use malted grains will supplement with commercial enzymes as it can significantly improve yields. In our experience with hundreds of distilleries, the primary benefits to supplementing with enzymes are yield improvement (less residual sugar and more ethanol at the end of fermentation) and reduced fermentation times. Supplementing with enzymes may also be necessary in seasons when there are issues with enzyme activity in the malt, which happens
sometimes. Although enzymes play a significant role in conversion of starch to fermentable sugars, there are other factors that are involved, namely enzyme dosing, temperature, pH and time. For example, many alpha amylase enzymes require temperatures of around 185°F for optimum activity, which is why distilleries normally cook corn at temperatures in that range. Smaller grains like wheat and rye are typically cooked at lower temps (165°F, for example) due to differences in how starch in those grains gelatinizes and other factors like protein content, etc. Malted grains are usually cooked at the lowest cook temperatures (145°F, for example) compared to other grains to prevent destroying the enzymes, and for that reason are often added last when making multi-grain mashes for bourbon or whiskey production. pH is also a factor and is dependent on the type of enzyme. Once the starch and the right enzyme dose is mixed together in solution at the right temperature and pH, conversion to fermentable sugars in not immediate. Thus, the final factor is time. In most grain-based mashes, two hours is a good place to start when considering residence time for cook relative to starch conversion. One must also consider the amount of starch in the grain as another determinant of success since it is directly related to the amount of fermentable sugar, which determines the ethanol production potential. Corn should have between 65 and 74% starch, for reference. Milling is also important as the grains must first be broken down into fine particles to increase surface area and expose starch to the enzymes. These factors, although highly important, were de-emphasized here for the sake of time. Figure 2 shows a microscopic view of starch buds containing amylose and amylopectin as they swell during the cook process from heat and water intake. It is during this expansion and subsequent bursting of the starch buds that the amylose and amylopectin are released, exposing the long chains of glucose
to the enzymes for breakdown.
Electron Transport Chain. When these additional pathways are
Other complex carbohydrates like cellulose and hemicellulose,
activated in the presence of oxygen the yeast can dismantle a
and structural components of plant biomass like corn stover
glucose molecule to produce much more energy compared to
or wheat stubble, have similarities to starch in that they are
when oxygen is depleted, which is great for reproduction and
composed of long chains of sugars, including glucose, that once
cell growth. However, when a glucose molecule is stripped of
released can be fermented by yeast. However, cellulose, unlike
most of its energy, there is no high energy ethanol molecule
starch, is a structural component and the bonds that link the
left for the producer. This is why when we propagate yeast, we
sugars together are much harder to break and require more effort
aerate the tanks, because we want to encourage cell growth
compared to starch. These are more of interest to fuel ethanol
and reproduction. In fermentation the tanks are not aerated,
producers, so we won’t go into the full details here.
except on rare occasion, because we are interested in ethanol production rather than yeast growth. There are other factors
OXYGEN CONSIDERATIONS Another important aspect of sugar utilization is oxygen
relating to oxygen that complicate sugar utilization with respect to distillery ethanol yields (see Crabtree effect), which we will save for another time.
availability, which can determine whether the yeast will use sugar for ethanol production or if it will be used to generate energy for cell growth and reproduction. This is a highly complex line of inquiry and there is still a lot to learn, so we will stick to the basics. When oxygen is depleted, as is the case several hours into fermentation, the yeast must utilize one of the few available energy-generating pathways that do not require oxygen. One of these pathways is called glycolysis, which includes some of the first steps for breaking down glucose to create energy. Following glycolysis, the glucose molecule has been stripped of some of its energy potential that the yeast can use to survive and the resulting byproduct is ethanol, which still retains a good bit of the energy of the glucose. When there is an abundance of available oxygen (aerobic conditions, where air is actively added to a vessel) the yeast has more options for getting energy from the glucose molecule because it can utilize metabolic pathways that involve oxygen. Other metabolic pathways involving glucose where energy is created that use oxygen include Krebs Cycle (also known as the Tricarboxylic Acid Cycle or Citric Acid Cycle in case you weren’t already confused enough) and the
DIAGNOSING ISSUES RELATED TO SUGAR UTILIZATION Now that we’ve covered the basics of sugar utilization, how do we identify and solve issues related to leftover/residual sugars at the end of fermentation? Identifying a sugar utilization problem is easy. If there are leftover sugars at the end of fermentation, there is a problem! Solving sugar utilization issues can be complex, but often relates in one way or another to what was discussed above. Table 2, Row 1 is an example of a high-yielding fermentation with low residual sugars and high ethanol. When we measure the components of fermentation using HPLC (High Performance Liquid Chromatography) the sugars are normally listed in terms of their Degree of Polymerization (DP), or how many glucose subunits the sugar has. In Table 2 the sugars are listed as glucose, maltose (which consists of two glucose subunits), maltotriose, often referred to as “DP3” due to having 3 glucose subunits, and finally “DP4+”, which represents glucose polymers that are four glucose subunits or longer (thus the “+”).
TABLE 2 Comparison of optimized fermentation of a grain-based mash with batches that have high residual sugars. Results shown are at 72 hours.
Normal batch with low residual sugars and high ethanol production
Batch with high fermentable sugars
Batch with high dextrins
DP4+ is sometimes referred to as “dextrins”, and represents
by several factors. Grain quality is a good place to start when
larger glucose polymers, which should get broken down over
troubleshooting issues with leftover dextrins. Milling and particle
the course of fermentation. Table 2, Row 2 is an example of
size also play an important role in how efficiently the starch gets
what a batch looks like with high residual fermentable sugars.
broken down. Enzyme activity is probably the biggest factor and
If the leftover sugars are fermentable (glucose and maltose in
is related to the quality of the malt or the types of commercial
this case) then we want to consider reasons why the yeast did
enzymes being used. If supplementing with commercial enzymes,
not utilize the sugars. One possibility is bacterial contamination.
make sure you are using the correct dose and also the correct
When bacteria or contaminating microbes affect fermentation
enzyme for the application. We often see high-heat enzymes
there will be high levels of organic acids (lactic and acetic
designed for cook being used in fermentation and vice versa.
acid) that accompany the residual fermentable sugars. This was
Those simple mistakes can lead to major yield and production
explained in detail in the Summer 2015 issue of Artisan Spirit,
issues. Cook parameters like temperature, residence time and
so refer to that article for more information. If organic acid levels
pH also contribute to whether starch is broken down completely.
are normal, as we see in the example in Table 2, Row 1, but the fermentable sugars are high, then we can rule out microbial contamination and start looking at something like a potential
nutrient deficiency or toxicity that is affecting the yeast. It could
Although we have just barely scratched the surface with respect
also be that we haven’t allowed enough time for fermentation to
to the complexity of sugars and their role in fermentation, it is
take place. Monitoring yeast populations, viability, and budding
easy to see how important sugar utilization is to distillery yields
can also help the producer determine if there are issues with
and overall success. Hopefully this information will prove useful
the yeast resulting in poor uptake of sugar, which causes lower
for understanding how different feedstocks are treated prior to
yields. Yeast populations should be well above 100 million cells
and during fermentation, as well as for troubleshooting issues
per ml with at least 90 percent viability, for reference.
related to residual sugars.
Another scenario is when the residual sugar is in the form of dextrins (DP4+ and DP3; Table 2, Row 3). This happens when there are issues with starch breakdown, which can be caused
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.
P R O V I D I N G R Y E to the distilling industry for over 50 years.
Brooks Grain Improving the quality of life with grain.
WRITTEN BY JOSH HEINTZ ///////////////////// PHOTOTOGRAPHY BY JOSH MARBERRY OF SOCIALLY PRESENT
he common stereotype of a hillbilly is a person who: is a white southerner who owns a shotgun, goes barefoot, wears a worn out floppy hat, drinks moonshine and whiskey which he makes himself, plays the banjo or fiddle, drives old beat up pickup
trucks, has bad teeth, is poorly educated, has long a beard, wears worn out clothes and hand me downs, and is happy and content with what they have. Like many stereotypes in this world there are truths and half-truths within this statement. That being said, the fastest growing
small craft spirits still manufacturer in the U.S. goes by no other name. Hillbilly Stills opened its doors for commercial sales in February of 2011. While they do come from the south, Paducah, KY, have strong Christian beliefs, wear beat up ball caps, drink moonshine, play the guitar, drive trucks and motorcycles, have long goatees and are happy and content with what they have—bad teeth, worn out clothes and most importantly, poorly educated, these pioneers are not.
S TA RT I N G O U T The company was founded by Mike Haney, who at the time was a crew leader in the coder department at a paper mill where he had worked for 32 years. His interest in distilling prompted him to come up with a concept for a flute that created an immediate buzz in the market. He was picked up by a web sales company prompting him to decide, “If they can do it, I can do it.” Starting with his self-designed flute, Mike set up his own website and started promoting Hillbilly Stills to the market. Matt Haney, Mike’s only child, isn’t afraid to tell you that from the time he was 20, for about six years, “I wasn’t much more than a drug addict.” He got into trouble and entered rehab. After rehab he got a job as a crane operator where he worked from the bottom up and after four years had worked his way to being promoted to foreman. He doesn’t try and hide this fact at all and wants people to know his history. He stated, “I don’t mind you including this. I want people to know that there is a possibility for a life on the other side.” He followed that with, “we took a leap of faith in starting this company, and here I am doing an interview with you today.” The mission at the time, as it still stands today, as stated by Matt, is to make “the very best still that is easy to use with safety and quality standards that will last generations.”
ADAPTING TO CUSTOMERS’ NEED
be with any still manufacturer. Each of
place that could possibly build pressure
their stills are built with the best quality
or a vacuum, or that could be modified
products available. All of the copper
by the end user to do so. At each point
Attending the ADI tradeshow and
kettles larger than 30 gallon and up to
identified, a pressure pop off valve and/
Whiskey Workshop in 2012, Matt came
300 gallon are built with material no
or vacuum break is added to alleviate this
back to the office with a renewed vision
thinner than .125 inches, and are all TIG
possibility of failure.
for the future: the craft spirits market
welded, not soldered. Each piece of the
If a manufacturer builds a still that has
is a segment they have to service and
distillation apparatus is pressure tested
a “thumper” or “doubler” on it, it is very
service to the best of their abilities. They
for leaks and the kettles are individually
important that valves or vacuum/pressure
provide everything from tabletop systems
leak tested. Matt explains that “on each
relief mechanisms be in place between it
to 300 gallon copper stills. Competing in
system, two of our builders have to check
and the still. Anytime a “doubler” is used,
a global economy as a startup themselves
each part of the distilling apparatus and
essentially a closed system is created.
they have been able to relate to the craft
the kettle, agreeing it is free from leaks
This is extremely important because if
spirits producers in a unique way. Just
or any other defect (outside of the normal
a still malfunctions at that point, while
like their own competition is made up of
tooling marks) before it ships.” The
running, it can build pressure, creating
giants, so is their customers’ competition.
majority of the stills HBS Copper and
an environment that could lead to an
Craft distillers compete daily with bigger
Hillbilly Stills produces are plated reflux
equipment failure. If a correctly sized
brands, forcing them to find ways to
batch stills, which means they are an
pressure relief is not in place, you run
do things better, faster and locally. “open” system and cannot build pressure or vacuum unless modified outside of the
the risk of a catastrophic still explosion. It also means that after a run, when
manufacturing facility. With each still
you shut your still down, it will build a
build the technical team identifies any
vacuum as it cools. Vacuums can be as
Q UA L I T Y
Safety is of utmost importance at HBS Copper and Hillbilly Stills, as it should
detrimental to the still as pressure, so
manufacturer is qualified, knows what
up to a certain amount, but not distilled
you need a vacuum break, or at the very
they are doing and will build you a safe,
spirits, and Matt said that many elected
least a valve to open in order to relieve
quality still. Be leery of any manufacturer
that is selling equipment at prices that
Currently Missouri is the only state that
Matt goes on to say, “I personally
are extremely low, and always make sure
has legalized Hobby Distilling. According
have been around a still in a distillery
it is built out of quality material with a
to the laws in place in Missouri, 100
that thought they were getting a deal
suitable minimum thickness.
gallons per person (of legal age) per
on a cheaply priced still. It was a 100
HOME DISTILLING MOVEMENT
gallon pot still, built from 16 gauge (0.05 inch) copper and it was constructed with a ‘doubler’. Furthermore, each seam all the way through was soldered not welded. Not only did it leak in multiple places when they set it up, but the first time they ran it, the kettle collapsed because there was no way to break the vacuum being created by the cooling ‘doubler’. Luckily they realized what was happening and removed a cap in the kettle in time to save it.” It is very important to always remember when looking to buy a still that the
About a year and a half ago, Matt
household, up to 200 gallons a year, can be produced, not for sale.
spearheaded a bill that would federalize
With political connections, nationwide
legal hobby distilling. He traveled to
sales, a dedication to quality, safety and
Washington D.C. to present this bill to
integrity, along with old fashioned family
Senators Mitch McConnell and Rand Paul,
values both in the home and business,
along with Representative Ed Whitfield.
these entrepreneurs are reshaping what
The bill is still in process and, as with
the craft and hobby distilling community
many things political, will take time to
stereotypically think of as a “Hillbilly,”
one still at a time.
“The goal of this bill is to fully legalize hobby distilling at home,” Matt said. Currently, it is federally legal to produce beer and wine for home consumption
Hillbilly Stills is located in Barlow, KY. For more info on HBS Copper, the commercial equipment division of Hillbilly Stills, visit www.hbscopper.com or call (270) 334-3400.
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producers across the US and
he word liqueur comes from the Latin word liquifacere
which means “to dissolve or melt.” Liqueurs were originally produced by Italian monks during the 13th Century and used as herbal medicines. These early liqueurs were made of neutral spirits and flavored with herbs, fruits, spices and nuts, and were usually sweetened. Cream liqueurs are only a few decades old,
1970’s. The cream liqueur category has long been associated with Bailey’s Irish Cream, one of the first cream liqueurs to enter the market. Over the last 35 years, Bailey’s has extended its brand with additional flavor profiles to appeal to a wider audience. However, a new wave of cream liqueurs has
positioning as a cocktail mixer and the use of social media to produce a loyal following. Recently, we sat down with three cream liqueur experts to discuss the category. All three work for Creamy Creation, a division of FrieslandCampina,
largest dairy cooperative. Our panel of cream liqueur experts has a few things to teach us about the science
Canada. Matthew Benny: A Senior Sales Manager, this food and beverage expert works with global brands to
cream liqueurs. His knowledge of consumer behavior and market insight has helped some of the biggest players in the business bring successful products to the market.
and selling of cream liqueurs,
Sitting around the bar at O’Lacy’s
which has recently become a new
Pub in Batavia, New York, we
started with the basics:
Jan Bindels: Jan hails from the
He has held several roles within
IN YOUR OPINION, WHAT MAKES A CREAM LIQUEUR BRAND SUCCESSFUL?
the R&D function in his 30 years
Joe: Promotion and giving the
Netherlands and is Senior Product Developer
also a certified liquorist—a liquor specialist who knows all the process steps for manufacturing any liquor
product a modern image. Look at RumChata. The brand owner did a great job of promoting it. They had reps going to bars and restaurants
been getting a second look by
which is sold in the world.
consumers. Led by brands like
Joe Kovalick: Joe is a Senior Sales
part of their success. While I don’t
Tequila Rose, Godiva and Rum
think it’s the best cream liqueur out
Chata, they’ve propelled this new
with over 25 years of experience
there, they really pushed the brand,
growth category, thanks to their
providing a range of ingredients to
leveraged social media, got young
for tastings. Social media is a huge
CATEGORY. WHERE DO YOU SEE THE CREAM SEGMENT HEADED? out
diminishes the taste experience.
Joe: I think the cream segment
Cream liqueurs should be served
will continue to evolve away from
traditional flavors, and I see cream volume growing through 2018 and
marketing campaign are key. There
WHAT IS THE STRANGEST REQUEST YOU’VE EVER HAD FOR A CREAM-BASED PRODUCT?
are plenty of amazing products that
Joe: We had a request for horse
Matt: Having a unique product
have underperformed due to lack of a solid marketing strategy. Conversely there are average products that have
milk cream liqueur. A sample was actually made in the pilot plant.
beyond. Matt: I think the industry is starting
really well with cream. We will see
Unique, neutral pH creams that
done really well because of their
Matt: Not sure how to put this…
bartenders will use as a mixer to
promotional marketing plan. Social
the most unusual was a cream drink
create interesting cocktails. The
media can do wonders for a brand.
aimed at male arousal. A sort of
popularity of pre-prohibition drinks
Viagra cream liqueur.
will have a positive influence
Jan: A unique combination of flavors
on cream and I can see some
with authentic brand positioning.
Jan: Cream liqueurs are alcoholic
drinks, targeting adult people, so
knock-offs with moderated success.
requests for typical “kid flavors”,
Rum Chata had a story to tell. They
like cotton candy or peanut butter
Jan: The cream liqueur market is
knew how to promote it. But for
and jelly are strange to me.
a niche market within alcoholic
an R&D guy like me, it’s all about what’s in it.
WHAT ARE THE BIGGEST MISCONCEPTIONS ABOUT CREAM LIQUEURS? Joe: Only old people drink them, they have to be coffee or chocolate
WHAT ARE THE MOST IMPORTANT THINGS TO KNOW WHEN WORKING WITH A CREAM BASED PRODUCT? Joe: It is an easy process—some additional cleaning and sanitation is needed but it is not difficult to work with creams.
flavored, or they must be refrigerated.
Matt: Adjust your pH!
None of these are true.
Jan: You are now bringing dairy
Matt: That it’s strictly a cold weather drink. It’s all about getting the right mouth feel, and flavoring the product for warmer weather. Jan: First, that a cream liqueur is
into your factory; this requires a different mindset for employees
Please, no ice! Ice melts and thins
Drink cocktails hitting the market.
beverages; I guess this will not change much in the near future. But it is also a steadily growing market with great potential. Look at the new line extensions from existing brands using creams— there is a bright future ahead.
WHAT ADVICE WOULD YOU GIVE A DISTILLER WHO MAY BE CONSIDERING DEVELOPING A CREAM LIQUEUR?
who have only produced distilled
Joe: Make it relevant to the 21-45
products. Sanitation is critical but
crowd. Give it sufficient marketing
not difficult. Rely on the experts and
we will educate.
a drink for only women. Secondly, that they are served on the rocks.
innovative cream-based Ready-to-
CREAM LIQUEURS ARE A GROWING AND INTERESTING
Matt: Don’t be afraid of the category. A lot of the distillers I talk to are apprehensive about blending with
fearing they will screw up the emulsion. As long as you’re handling the product correctly, adjusting pH, it’s not overly complicated. Jan: Contact experts in the field so that developing and producing a cream liqueur will be a flawless experience.
HOW WOULD YOU DEVELOP A CREAM LIQUEUR THAT APPEALED TO MEN? Joe: Keep it simple, not too sweet, forget gimmicks and crazy ingredients. Men are simple creatures. Leverage social media. Larger brand owners need to understand the social media community and how it can launch or kill any product. Matt: Using a dark spirit as the alcohol
Matt: I would say Forty Creek
is always a good
Whiskey Cream from just over the border
start. Cognac or bourbon or a dark,
in Ontario is probably my favorite. I prefer
spiced rum. Whiskey creams are doing really well lately, especially with male consumers. Also, keeping the sugar level fairly low.
to drink creams straight, but chilled. Jan: Tequila Rose. The tequila gives a twist to the strawberry flavor which makes this product timeless and you never get
Jan: I would not develop one that appeals
bored by it. Europeans, like me, drink
to men. Focus on women. Keep it simple.
their liqueurs straight up, we do not
Stick to basics.
refrigerate the product and we certainly do not add ice to it.
FINALLY, WHAT IS YOUR FAVORITE CREAM LIQUEUR BRAND AND HOW DO YOU DRINK IT?
It’s fair to say that cream liqueurs have been overlooked in the spirits segment, but they should not be underestimated.
Joe: There are so many good ones it’s hard
With unique selections entering the
to choose. Fulton’s Harvest Pumpkin Pie,
market, cream liqueurs are a growing
Blue Chair Bay Banana Rum Cream and
category with an interesting history.
Buffalo Trace Bourbon Cream are some of my favorites. I drink them chilled— straight from the fridge—or I pour them over ice cream.
Creamy Creation is a division of FrieslandCampina. For more information, visit www.creamy-creation.com or call (585) 344-3300.
LEAPING ACROSS THE SEA AN INTRODUCTION TO WORKING WITH THE FAR EAST WRITTEN BY AMBER G. CHRISTENSEN-SMITH
ou’ve established an amazing product and the locals are in love with it. So, where can you take it next? The
European market holds promise for savvy craft products but is growing more and more saturated every day.
Perhaps you’ve heard about the demand for aged spirits in India, but have yet to see the progress everyone seems to be promising for American spirits there. Finally, you’re noticing some serious interest and growth in nations such as China and Korea. Great, now how do you get your item into the hands of Eastern consumers? Joel Flachs of East-West Advisors Group recently shared some points of interest in getting your product to Far East consumers. His business has worked with various industries, helping them bridge the gap from the US to East Asian countries and back. With his guidance, we’ve learned some essential lessons that you can consider when trying to export a craft distilling product to China, Korea, or other East Asian nations. It is essential to think through the real process of getting your product overseas. There are many items you will need to consider should you decide an East Asian market is right for your brand. With this, we introduce to you:
FIVE THINGS TO CONSIDER WHEN EXPORTING TO THE FAR EAST
with your own business and products. It may sound cliché, but
this anecdote: “A Chinese business colleague called me
“who you know” is more important than ever when working with
once and wanted to arrange the purchase of saw blades from
Germany. He had the German contact person’s phone number,
When working in China, finding a way to make businesses and
HAVE A UNIQUE & IDENTIFIABLE PRODUCT WITH AN INTERESTING BACK STORY. Like their American counterparts,
individuals feel comfortable with you is incredibly important.
Chinese customers are interested in unique products that
You need to take the time to get to know who you will be working
can grab their attention. “Just like everywhere else, they like
with on a personal level to gain their trust and build comfort
to brand themselves up,” shares Flachs. “The urge to follow
address, and pricing. I asked him why he didn’t just directly call the German contact and his reply was, ‘But Joel, we know you.’”
branded items is bigger in China.” They want products that are
WE’RE SERIOUS ABOUT OUR WORKSHOPS.
interesting to them and to others. They also love a story that
WE JUST LOOK LIKE WE’RE HAVING FUN…
goes with a product—they want to know why the product is great and unique and they want to identify with it to some degree. It’s worth noting that “Made in America” isn’t necessarily appealing to the Asian market, but it isn’t a negative either. A universally appealing story is what matters.
BE PREPARED TO DO THE WORK. Distribution to China has a lot of similarities to the US.
Once you find a distributor, they will give samples to their favorite mixologists who then build customer interest and rapport. But not only do you have to gain distribution, you will need to build relationships with individuals and companies and you’ll have to understand a different market due to cultural barriers. In
AMERICAN DISTILLING INSTITUTE
DISTILLING WORKSHOPS FALL 2015 HANDS-ON RUM DISTILLING
Instructors: Ryan Sutherland, Sutherland Distillery, Nancy Fraley, Nosing Services @ Do Good Distillery, Modesto, CA
Covers the fundamentals, including: mash preparation, basics of fermentation and wash production, mechanics of distillation (stripping & spirit runs), “making the cuts,” barrel maturation, proofing, sensory evaluation, and bottling. Also included are presentations in the business of running a distillery and getting your product to market.
November 13 — 15
HANDS-ON BRANDY DISTILLING MASTER CLASS
Working with grape varietals Instructor: Hubert Germain-Robin @ McMenamin’s CPR Distillery, Hillsboro, OR.
Hands-experience with fermentation, distillation, barrel management and blending. 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
addition, you will need an export license and a shipping company to work with in order to get your item overseas legally.
FIND A GROUP OR COMPANY TO FACILITATE YOUR EXPORT PROCESS. When trying to figure out exactly how to go about exporting your product, it may seem like a huge timesuck in your already busy schedule. Finding a company that specializes in finding foreign contacts can facilitate your export process and can save you from many headaches. Experts and consultants that know how to talk to foreign companies can help by not only bridging the language barrier, but in understanding the etiquette that can make building company relationships faster. An introduction to the market from someone trusted and knowledgeable will help pave the way.
UNDERSTAND THE INVESTMENT. Many companies are not eager to pay for samples. You
will need to be prepared to export samples at your own expense.
Make sure this is something you are prepared to invest in. Gaining market share in the Asian markets, like all markets, takes time and money. These tips are just the beginning of your adventure in exporting. With careful planning and research, you can have a great opportunity for growth in other nations and you may just be creating the “next big thing” for a new group of consumers.
Joel Flachs is Managing Partner of East-West Advisors Group. For more information, visit www.eastwestadvisorsgroup.com or call (484) 467-3700.
solve: how could a simple desire translate into making whiskey?
HOW TO GET INTO DISTILLING WITHOUT H AV I N G T O OWN THE JOINT
I’ve done every one of the things suggested below, and I
WRITTEN BY JEANNE RUNKLE
orking for a craft distillery isn’t all R&D (i.e., drinking on the job). Bags of grains and tubs of molasses don’t
magically turn themselves into whiskey and rum. It takes
dedication and hard work—hot, sweaty, knuckle-banging work. Work that is also very satisfying! If you think this is the career for you, but don’t know quite where to begin, check out these tips to get started. When I started researching the craft spirits industry, I honestly had no idea it would lead me to being a distiller. My background includes being a jet engine mechanic for the Marines, and the bulk of my professional experience and education is marketing and customer experience. However, with every new distiller I interviewed the desire to join their ranks grew. I had a problem to
continue to do them. While my formula worked (with a splash of right place/right time) it may not succeed for everyone. So I also
DO KNOW YOUR STRENGTHS
spoke with people that have shared a similar journey into craft
Craft distilleries aren’t usually big enough that you’ll do just
distilling, to get their perspectives.
one thing. Did you bartend your way through college? That’s a
John Wilcox is an artisan distiller with four years of commercial
great transferable skill, especially if the distillery you want to
experience in the craft spirits industry. With a degree in art, he was
work for has a tasting room that serves cocktails. More than
on his way to becoming the stereotypical “starving artist”. He got a
one of today’s crew of Head Distillers was yesterday’s tasting
job in the craft beer industry as a way to support himself because
room bartender. Homebrewing is also really helpful, since you
as romantic as it sounds, the starving part isn’t that great. Beer led
already understand a large part of the distilling process. Every
the way to cocktails and whiskey, and that led John into a career in
good whiskey starts with a good mash!
distilling—one he didn’t even know he was looking for. Laura Johnson is the Co-Founder/Head Distiller of Your & Yours Distilling Co. in San Diego, and Founder of Distillerista.com. Over the course of a year, she attended classes at several distilleries, and toured as many distilleries as humanly possible along the way. With her dream job solid in her mind, she is working with one of the local distilleries to navigate the maze of permits and paperwork it takes to open a distillery. While her path into distilling was more intentional than mine, she used many of the same ideas to break into the industry.
D O K N O W W H AT Y O U ’ R E S I G N I N G U P F O R Fermentation waits for no (wo)man, so you’re likely saying goodbye to a regular, 9-5 style job. Sure, there are schedules — but when the still doesn’t run quite the way it’s supposed to, or an early morning delivery pushed your mash-in back an hour — you can’t just close up shop and leave at 5. The long, irregular hours can be stressful.
D O L E AV E T H E H O U S E ! You’re entering the world of start-ups. No one waits to start
While their journeys differ (John lived in a tent during his
a business until everything is completely perfect, and the
apprenticeship, and Laura had to secure funding capital), both
same goes for you. You never know who you’ll meet that could
John and Laura offered similar advice about getting into the
change your entire life when you step out your front door. My
industry. Along with my own tips, we present our advice, and hope
first event was terrifying! Take a friend if that makes you feel
it will help get you started in pursuing your career in distilling...
more comfortable (I did), but get out there.
“ iIft ’ds i sntoi lt l ianl gl bi se eyro ua rn dp awsesni ocnh eAsN! DI t yt oa uk er sj osba,c irti’fsi cael lawn od r thha ri dt . wI to’ sr kt—h e best time in all the world to get into this industry—do it now!” JOHN WILCOX,
“ mA lal kai ns pg eict t as r oe f t go eutgthi n ign i nt h ai sn di n d u s t r y. Yo u ’ l l f i n d o u t v e r y q u i c k l y w h e t h e r or not this is what you want to do. Every setback I’ve dealt with has only strengthened my conviction that I have a place here. I f i t ’s f o r y o u , d o n ’ t g i v e u p . ” LAURA JOHNSON,
D O S TA RT W H E R E Y O U A R E Chances are pretty high that within a reasonable drive of your home, there is at least one craft distillery. Go visit, if you haven’t already. While it might not be your final destination, you should know your local distillers.
D O N ’ T F O R G E T Y O U R ( D I G I TA L ) N O T E B O O K You’ll be out and about, shaking hands and kissing babies. Take notes! Especially if the event involves tasting, you don’t want to forget something important.
DON’T LET FEAR GET THE BEST OF YOU
You’re likely changing careers in a big way to get into distilling,
DISTILLER OF YOUR & YOURS DISTILLING CO.
but don’t let that overwhelm you. Yep, you’ll be afraid, that’s
D O S H O W Y O U R FA C E , B E A S U P E R FA N ( B U T N O T A S U P E R S TA L K E R )
If you’ve picked out a distillery (or two) that you’d like to work
normal. But don’t let it take over.
DON’T STOP LEARNING I learn something new every single day. It might not be a big
for, show up! Drop by the tasting room, talk with them at events.
thing, but there’s always something to read or watch that will
Follow them on social media and sign up for their newsletter.
improve your knowledge. Take advantage of every opportunity to
Most have bottling parties—you should be there! But be a
expand your skills.
fan, not a stalker — show up during business hours, and don’t overstay your welcome.
Jeanne Runkle currently lives in the Northeast. You can also find her whisk(e)y musings at PancakesandWhiskey.com.
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n July 18, the 2015 Oregon Distillers Festival brought 250 thirsty consumers and 35 Oregon
distillers together at McMenamins Edgefield in Portland, Oregon. A unique venue with a brewery, cidery, distillery, winery, hotel, spa, golf course, theatre, orchard, gardens and over 10 different restaurants, bars, tasting rooms or other purveyors of fine beverages on-site, McMenamins founded ODF in 2013 in cooperation with other distilleries and the Oregon Distillers Guild. “The ODF is an event that McMenamins started to showcase the craft distilling industry of Oregon,” tells Clark McCool, Director of Operations for both of McMenamins’ Distilleries and the Edgefield Winery. “We limit the participation to only Oregon Distilleries to give our customers a thorough snapshot of the who’s who in the current Oregon distilling scene.” Per tradition, the event was held on the hottest day of the year, as many distillers joked, but this
year they gathered under some tall fir trees, which shaded all the distillers except for House Spirits Distillery, who drew the short straw. Muggy, 96 degree heat did not steer attendees away, however, whose $30 admission earned them 14 tasting tokens and a chance to hang out with the distillers in a lively summer party atmosphere with delicious hors d’oeuvres prepared by Edgefield’s Executive Chef. Bull Run Distilling Company’s Patrick Bernards called this year’s ODF “the best one we’ve had,” and many distillers and attendees agreed. “I think their pricing was right on,” tells Justin Baker, who attended with his fiancé, Liz. “It was well worth it. We did a pretty solid sampling. We couldn’t try every spirit, but we tried something from almost all the distilleries.” A whiskey lover, Justin’s favorites included Bull Run Distilling Company’s Temperance Trader Barrel Strength Straight Bourbon and Big Bottom Distilling’s Port Aged Straight Bourbon. While he’s not typically a fan of flavored whiskeys, he also enjoyed Brody’s Apple Pie Moonshine, a naturally flavored corn whiskey that he said was very thoughtfully made. With 14 tasting tokens, attendees were able to try a variety of spirits, and many people found new favorites. “I really liked the cranberry liqueur that Clear Creek Distillery brought, and right next to them Wild Roots Vodka had a
raspberry vodka that was very good,” said Liz, a long-time bartender.
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Justin and Liz have been to wine tastings before, but never a spirits tasting, and they said they were impressed with the quality and diversity of spirits and had a great time. In fact, Clark McCool says people were having so much fun that they had to encourage the distillers to close up shop at 7 pm, the event’s official closing, because many people wanted
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to stay later. “People hung out here,” said Ted Pappas of Big Bottom Distilling and President of the Oregon Distillers Guild. “They
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stayed—they didn’t taste and run.” Encouraging people to stay and get to know the distillers was
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a shared goal for the distillers, the Guild and McMenamins,
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outside so the party stayed focused in the middle. They also
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so Mcmenamins arranged the booths in a circle around the provided each distillery with an identical booth, which Michelle Ly of Vinn Distillery said encouraged attendees to focus on the products rather than the booth displays. Ly says it was nice not to have to haul in so many booth materials, too, which she is used to having to do for tasting events. Oregon is home to several other spirits tastings like The
Original Artisan Spirits Tasting, TOAST, and the Great American Distillers Festival, GADF, both of which are very successful events that draw over 1,000 attendees. Ly attends and has had great experiences at both of these tastings, too, but she says she also appreciates the smaller venue at ODF. “This event felt more intimate, both with other vendors and the customers,” she offers. “I really enjoy Edgefield as the location for a festival, and I think Edgefield puts the customers in ‘vacation’ mode so they are much more open to trying new things.” Many of the distillers said their specialty products drew just as much or more attention than their classic offerings. Liqueur maker Chris Beatty of Spiritopia said he poured a lot of samples of his ginger and apple liqueurs, and his booth-neighbor Jason O’Donnell of Tualatin Valley Distilling said his historicallybased herbal liqueur, Morewoods Usquebaugh, drew even more attention than his whiskies. One event favorite showed up in force, earning ODF the unofficial nickname of “World’s Greatest Pear Brandy Expo.” Since Oregon produces 25 percent of the nation’s pears, it is a fitting product for Oregon distillers. Clear Creek Distillery poured their highly-praised Williams Pear brandy, Monte Costa poured Big Bottom’s Oregon-grown Asian pear brandy, Immortal Spirits’ Eau-de-Vie Poire was a blend of young pear brandy and the 2010 vintage which was aged four years in Oregon Oak, and McMenamins Edgefield Distillery showcased their Estate Pear Brandy, made from Asian, Perry and other pear varieties grown, fermented, distilled and aged 100 yards away. While many attendees sipped their samples straight, most of the distilleries offered simple cocktails, as well, which were very popular in the heat. Sebastian Degens of Stone Barn Brandyworks poured over two bottles of his unaged rye whiskey in a chilled cocktail he mixed at his booth. One other attraction that intrigued attendees was a silent auction in the center of the circle of booths. Ten distilleries donated spirits, swag, and other items, and many bidders participated. The proceeds went to the Guild, which actively promotes Oregon spirits, just like ODF. “The main focus of the event is to offer Oregon distilleries a unique venue to showcase their products to Oregon consumers,” explains McCool. “Hopefully we are building an event where patrons can interact and taste current and new releases that all Oregon distilleries have to offer.”
For more info, contact McMenamins (www.mcmenamins.com) and Oregon Distillers Guild (www.oregondistillerytrail.com).
the art of
THE SHOW W R I T T E N B Y C A RT E R R A F F
he spirit show, like many tradeshows, is a place where you
and the external factors associated with the show. Find out all
can display your wares to the public. The spirit show is
the details you can:
a great place to have your target audience, whether it be the general public, buyers, bartenders, restaurants or retailers, try your products and evaluate them. The opportunities to showcase your brand are huge, but there are quite a few factors you need to consider before doing a show.
THE FIRST AND FOREMOST: IS IT WORTH IT? While some events are free for vendors, others charge exorbitant fees upwards of $3000 for a single table. Either one might not be worth it. While the expensive one is obvious, the free show still requires your time and energy and might not stack
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Noise level and location of the music relative to the booth you’re at Where they’re marketing and to what demographic How many discount tickets they plan to sell or give away How many complimentary tickets you can get (so you can invite buyers, distributors and key customers) Estimated attendance level Event location and space How loud the venue itself is
up a reasonable ROI. I’ve done free shows in clubs where the
Yelp is a great source for researching venues as you can read
music is blaring so loudly that no one can hear your sales pitch,
reviews and gain some insight to what people are complaining
nor are they really interested. They’re interested in free booze.
about. This might include noise level of the location itself and
So before I accept an offer for an event, I consider the venue
maybe traffic patterns from previous shows.
LOOK AT ALL TYPES OF SHOWS. I tend to display at shows in the $300-$900 range when I think it will actually benefit me and my products. For example, I frequently sign up for wine tasting events. This gives me an
everything is in order, because you could be at fault even though you weren’t involved in the organization of the event.
ALWAYS ABIDE BY ANY RESTRICTIONS OR RULES FOR EACH EVENT.
edge over the wineries. I’m unique and not wine, but in the same
This includes last call, final calls and restrictions for number
spirit (no pun intended). After people have sampled 15 wines
of pours. Check to see whether security will be present and what
and they come to your booth they usually find it a relief to have
to do if a customer gets out of hand. Check to see if they will
something different to try. Just be sure you’re serving straight
be carding at the door. If they are, you’re probably set to go, if
alcohol or cocktails that won’t affect their palate.
not, make sure to card people under 40. Load in and load out
ANOTHER AREA WORTH RESEARCHING IS PRIVATE EVENTS.
times are also important. These people have to service lots of
In California, no permits are required in most areas to do private events, but please check with your local ABC to make sure. Compliance is always the right way to go. Look at doing tastings at corporate events. Most of the time they’ll pay you and provide some nice facilities.
MAKE SURE YOUR INSURANCE IS CURRENT AND COVERS DOING SHOWS OUTSIDE OF YOUR DISTILLERY. Many venues require both general and liquor liability insurance. They may also require you to have workers comp if you have employees besides yourself. If you hire people just for the show, they are independent contractors and you won’t need workers comp. The venue might require you to add them to your insurance for that show and will usually provide the proper language as such. Many insurance companies will do that free of charge, but I’ve run across some insurance companies that charge separately to add others to
producers and want everything to run smoothly and that can’t happen if people don’t follow the guidelines.
BE PREPARED, AND SHOW UP EARLY. Even if your setup is easy, 2-3 hours gives you enough time to properly set up one booth and get comfortable. I set up and then with the time remaining get something to eat, get bottles of water and check out the competition. Have a backup plan for the most basic things such as getting to the show, your support staff, and the product itself. I’ve been to shows where the distributor was supposed to ship the product for the producer and they forgot.
DON’T RELY ON ANYONE ELSE— MAKE SURE YOU VERIFY EVERYTHING. Some venues allow you to ship your product there ahead of time, but require it to be delivered on a specific date. Keep emails with your discussions and verify a week ahead of time and
the policy. Make sure your vehicle is covered, as well, in case of an accident and product loss, theft or some unforeseen acts.
IF YOU’RE DOING A SHOW WHERE THE PERMITS ARE HANDLED BY THE ORGANIZERS PLEASE MAKE SURE THEY ARE IN ORDER. Most people not in the alcohol business, manufacturing specifically, don’t
and regulations associated with our industry. I did a show once that was raided by the California ABC. Turns out the permit they had only allowed the catering staff to pour samples, not the individual distillers. In the end it worked out, but the show never happened again. Just be sure
the day before as well. Bring extras of everything: pourers, bags, product, bar rags, etc. For cocktails, as it can get expensive, bring what you think you’ll go through and no more. If you run out, finish out the day with your straight alcohol. While most
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shows say they will provide tasting cups, don’t rely on them to provide enough when the attendance is in the thousands. This is your passion—show that you can be organized and prepared.
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I see almost exclusively the same signage at every booth, whether it’s a large commercial distillery or a craft distillery with one product. Try to be creative and stand out from all the generic signage. Decorate your table with just the right amount of stuff— not too much or too little—and make sure it complements your product. If you’re at an event that would benefit from serving a small ¼ oz. cocktail make sure it’s a recipe that will knock their socks off. Wine events, as mentioned earlier, are good for this as cocktails won’t completely destroy their palates. I offer the customer a choice between a cocktail or straight pours. I always warn them about the straight if it’s something sure to mess up
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their palate such as my absinthe. If you do have cocktails make sure to print out copies of the recipe as people will ask for it, or better yet, direct them to download it off your website.
LIMIT PROMO MATERIAL ON YOUR TABLE TO A TASTEFUL SELECTION. I’ve seen producers with five postcards all for one product. Don’t overwhelm your customer. I never hand out business cards NOW PROVIDING DISTILLING EQUIPMENT FOR ALL SIZE PRODUCTION FACILITIES. PLEASE CALL TODAY FOR MORE DETAILS AND PRICING ON EQUIPMENT.
to the general public, but have my web address on postcards. I keep business cards for industry people.
THE BEST SHOWS ARE ONES YOU CAN SELL AT. When you can sell at a show, try to not undercut your valuable accounts (bars, restaurants and retailers) by too much. I generally
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sell my products for retail prices and I pay the sales tax. I also offer specials such as package deals or swag incentives to close the deal. We also offer to hold packages for customers behind our booth until they are ready to leave by having them fill out a tag with their name and number in case they forget to pick it up. If you do sell, make sure you have a resale license and pay the sales tax.
AND MOST OF ALL, HAVE FUN! This is where you get to shine and show your lovingly crafted product off to the end consumer. This is also where you can make friends with other distilleries and be part of the community. Corporate Office West Coast North Northwest Canada British Columbia Pleasantville, NY Windsor, CA Geneva, NY McMinnville, OR Montreal, QC Kelowna, BC
Carter Raff is owner and master distiller of Raff Distillerie in San Francisco, CA. Visit www.raffdistillerie.com for more information.
C H R I S T E N S E N - S M I T H G . A M B E R B Y W R I T T E N
ALLTECH BREWING & DISTILLING ACADEMY hen it comes to the beginnings of your commercial distilling
Alcohol School and is now, 35 years later, a full-fledged academy
endeavors, we can all agree that a solid understanding of
with an all new curriculum and facility in Lexington, Kentucky,
the craft of spirit making is essential. Finding the right balance
as of 2014.
of art and science does not appear overnight through an osmosis
Alltech was first imagined in 1976 by Dr. Pearse Lyons, who
of books and booze. Craft distilling lessons take time to digest
was initially sought to aid in improving processes for Kentucky
and savor in order to deeply gain a knowledge of the distilling
ethanol distillers. Lyons is known in the community as an
agricultural expert and businessman and has authored over 20
Classes teaching craft distilling production is a growing market,
books. He founded Alltech, which is the parent company of Alltech
and assistance can be found in an expanding field of educators.
Lexington Brewing & Distilling Co., and began Alcohol School
Some students of spirits dive into text and experimentation—
in 1980. He also co-authored a text on alcohol science, which
and in picking the brains of current distillers. These explorations
started the journey to Alltech Brewing and Distilling Academy.
are essential to gaining a footing in understanding how craft
Alltech has developed a range of classes that are both current,
distilling works. However, there are formalized education
in that they cover regulations and modern techniques, and
opportunities that do exist for the student that is focused on
flexible, in that the classes can be customized for a particular
the deeper scientific processes of craft, the business model
person or group. In 2015, 24 courses are being offered to
surrounding spirit development, and production considerations
intimate groups of attendees, in order to ensure adequate
that can complement those other solo investigations.
attention for all students. Having classes that meet the needs of
This is where Alltech Brewing and Distilling Academy of Kentucky can be a viable choice for those looking for organized education. Alltech began its distilling education program with
distillers seeking new knowledge and skills is vitally important to the academy. Alltech is dedicated to becoming a “one-stop show for a
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broad range of students,” according to Danielle Palmer, Public Relations Coordinator for Alltech, “whether for the entrepreneur who wants to see if his or her home brew can be a viable commercial success, or for the existing brewer or distiller looking to perfect his or her own process.” Palmer also stresses that the academy helps the student see how production goes from raw materials all the way through to a product that can be placed in a consumer’s hands, with an education that ensures students know exactly how the entire business is built from grain to glass. Alltech offers a wide range of classes and is, “coupled with our own operating brewery and distillery to provide students a handson opportunity to learn and practice craft brewing and distilling processes,” Palmer shares. Having an actual working distillery on-site is a great advantage for students wanting that personal experience. The school also has a new classroom and state-ofthe-art laboratory that helps students dive into the technicalities of distilling and classes are led by well-known experts in the field of distilling. Classes currently cover subjects such as raw material procurement, equipment sizing and design, modern distilling, brewing techniques, flavor evaluation, and even government regulations. Some classes are condensed into three days, while others can last up to two weeks. “When you combine those capabilities with hands-on training in our new laboratory, coupled with the expert instruction provided by our well-known faculty of brewers, distillers, engineers, and biochemists,” says Palmer, “we do indeed have the ability to provide a brewing and distilling education that consistently exceeds the expectations of the industry.” Over time, the academy has successfully worked to gain accreditation thanks to their instructors that boast Master of Science degrees and decades of distilling experience. Alltech is set to start offering certifications and credits via their partnership with Western Kentucky University. Credits earned through the academy can now be applied towards Western Kentucky’s Bachelor’s degree in Brewing and Distilling Science, which can support the Master of Science degree for those going to the next level beyond a BA. Overall, Alltech’s goal is to provide services that will encourage future distillers to start new businesses and join the industry. Alltech welcomes all students who are interested in becoming brewers or distillers, and the academy looks to be a great option for those seeking another way to learn about the craft and to further their mastery of distilling.
Alltech Brewing and Distilling Academy is located in Lexington, KY. For more info, visit www.alltechacademy.com or call (859) 225-8095.
STEPS TO DISTRIBUTION
WRITTEN BY JUSTIN KOURY
istribution is perhaps one of the most mysterious and complex aspects of the spirits business. Understanding the state by state regulations and the three-tier system vs. self-distribution
can be daunting, and so we will focus instead on finding and keeping the best distributor to meet your needs and skip for now the legalese. In this series, you will learn how to understand the intricacies of dealing with distributors, which can be unpleasant unless you know what you are doing. Arm yourself with as much knowledge of the standards and laws of your state, and never assume that once you have a distributor your job of selling is over—it has only just begun.
THREE THINGS TO KEEP IN MIND
1 2 3
STARTS WHEN THE BUSINESS PLANNING
BEGINS. You have to know what your capabilities are
You do not need to rush to find a distributor (take your time)
initially. In your business plan, you will likely have sections
Distributors exist to make money
humble, but be bold at the same time. Think about how fast
You have a say (your needs matter)
Now, it’s important to note that the distributor you start off with as a small brand may not be the same distributor that works in your favor five or ten years down the road. However, what is important is maintaining those relationships and an understanding that people rarely leave the hospitality business. An account manager at one distributor will very likely wind up at another distributor a few years later. This business is like the mob in that sense: no one ever leaves, they just move on to another company. This is especially true in large markets like Chicago, New York and San Francisco. Finding and keeping a good distributor, while complicated, can be summed up in five straightforward steps presented in this guide.
for 2, 3, 5 & 10 year growth. Be realistic, be honest, be you want to grow and how much that will cost. Some key questions to ask yourself:
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When do you want to be regional? Do you want to be a national brand at all? Are tasting room sales an option? What will your tasting room sales look like? How much social media will you use once you begin distribution? Do you want to focus on restaurants, craft bars or retail? Are online sales an option?
Hopefully you have done this with your business plan, but if not it is never too late.
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IS WHERE YOU DECIDE WHAT TYPE OF
DISTRIBUTOR YOU WANT ON YOUR TEAM—AND IT IS A TEAM. Take a moment and think about your potential relationship with your potential distributor. Ask yourself:
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What accounts do they have that make you salivate? What areas do they excel in? How large is their exposure? What motivates their sales force? What motivates them? Are they in the business because they love it?
Take these questions and make a wish list including what accounts you want to be in, and how fast you want to go. After you’ve made your wish list, set meetings with potential distributors and ask them what their goals are, what their needs are for craft brands and how they can help grow your brand. This is not the meeting where you discuss benchmarks, this is the meeting where you understand the beginning of a relationship.
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IS WHERE YOU NARROW DOWN THE CHOICES
OF WHO FITS YOUR NEEDS, AND DETERMINE WHICH RELATIONSHIP IS THE MOST MUTUALLY BENEFICIAL. More useful questions to ask include:
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Is their salesforce trained in spirits? What does their book look like? Is it (book) overloaded with craft brands and you will get lost in the shuffle? How do they pay their employees? How much time will they need you to commit to training? What production levels do they expect and are these numbers flexible? What is their percentage rate? What does their contract look like? Can they complement your marketing strategy?
Just because you are a small producer doesn’t mean you need to enter into a multi-year contract where the distributor has all the power. Make sure your attorney knows what it is you’re looking for, and can write a contract that is based on mutual understanding, respect, and benefits both parties.
REQUIRES YOU TO SIT DOWN AND WRITE
A TRAINING STRATEGY AND BUDGET TO HELP THE
SALES FORCE UNDERSTAND YOUR PRODUCT, YOUR STORY, AND MAKE SURE THAT THEY’RE PUTTING OUT YOUR MESSAGE CORRECTLY. It should go without saying, but in most cases the salesperson has more contact with your potential buyers than you will. They are the ones who maintain the relationships and build the trust of buyers so you can focus on production. This is where empowering your distributor to get your message out—a message that is consistent, unique, and speaks to your individuality while appealing to your target audience—is crucial. The training strategy should include:
»» »» »» »» »» »» STEP
How often you will be in the market How often you will do ride-alongs How many sample bottles in each quarter How many events you want to do How you will incentivise the salesforce (budget) Your marketing strategy including social media
IS TO WRAP EVERYTHING UP ONCE YOU’VE
FOUND YOUR DREAM DISTRIBUTOR WHO RESPECTS YOUR NEEDS AND LIMITATIONS. Go after them. However, if they are not willing to sit down and work with you on your needs, then move on! Set benchmarks for ramping up production, getting into new markets, putting out new products, and finally nursing the markets you are in (do not neglect current consumers for the sake of expansion). You may need to spend some time looking for the right fit, and could change distributors half a dozen times before you get one that puts you in the position you want to be in the market. Be cautious not to burn any bridges along the way, this can come back to screw you later. Your overall strategy should include whether or not your distributor can handle your internal benchmarks. Can they take you from local to 50 states? Most of the time that answer is no. Here is where you include a plan for peaceful step-by-step handoffs to the larger more permanent home of your brand. In part two of this series, we will look at how to put together the best training program, as well as what the distributor is looking for from craft brands. Hint: it is not vodka.
Justin Koury is a transplant to California from Chicago, where he spent 10 years in wine and spirits retail. He is a graduate of Purdue University’s Hospitality, Tourism management program and has taught culinary school, spirits classes, wine training and has written extensively on the craft business.
ADVERTISER index BARRELS
The Barrel Mill Barrels Unlimited Black Swan Cooperage
Thousand Oaks Barrel Co.
DISTILLERY MERCHANDISE Distillery Products by Laser-On
GUILD ORGANIZATIONS 6 & 20
BOTTLE & GLASS DECORATING Loggerhead Deco
Global Stainless Systems
HBS Copper Stills
Headframe Spirits Manufacturing
BOTTLE MANUFACTURERS & SUPPLIERS
Specific Mechanical Systems
New Westgate Glass Packaging
Prospero Equipment Corporation
Rudolph Research Analytical
Packaging Support Group
EDUCATION American Distilling Institute Moonshine University
The Whole Package Workshop 6
Spirits Consulting Group
CORKS & CLOSURES
7 & 115
CREAM LIQUEURS 49
DESIGN, BRANDING & MERCHANDISING CF Napa Brand Design Thoroughbred Spirits Group
LABELS Fort Dearborn
7 & 13
MILLING MACHINES Stedman Machine Company
PACKAGING All American Containers, Inc.
PUMPS & HOSES 113
InLine Filling Systems, LLC
Saint James Spirits
Total Wine & More
SUGAR CANE & MOLASSES FINANCING Brewery Finance
REFRIGERATION & CHILLERS
TOTES & TANKS FOR SALE
ENZYMES & YEAST
McFinn Technologies Ferm Solutions
6 & 110
7 & 24
COMPLIANCE & BACK OFFICE MANAGEMENT American Spirits Exchange Ltd.
American Craft Spirits Assoc.
Artisan Still Design
112 6 & 18
Custom Metalcraft 112
7 & 52 94
GNS & BULK SPIRITS SUPPLIERS
MGP Ingredients Pharmco-Aaper Ultra Pure
17 113 64
ARTISAN SPIRIT sponsors
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
The magazine for craft distillers and their fans.